[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]



 
                  DEPARTMENTS OF LABOR, HEALTH AND HUMAN
                SERVICES, EDUCATION, AND RELATED AGENCIES
                         APPROPRIATIONS FOR 2016

_______________________________________________________________________

                                 HEARINGS

                                 BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FOURTEENTH CONGRESS

                              FIRST SESSION
                            __________________

  SUBCOMMITTEE ON THE DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, 
                    EDUCATION, AND RELATED AGENCIES

                       TOM COLE, Oklahoma, Chairman

  MICHAEL K. SIMPSON, Idaho              ROSA L. DeLAURO, Connecticut
  STEVE WOMACK, Arkansas                 LUCILLE ROYBAL-ALLARD, California
  CHARLES J. FLEISCHMANN, Tennessee      BARBARA LEE, California
  ANDY HARRIS, Maryland                  CHAKA FATTAH, Pennsylvania
  MARTHA ROBY, Alabama
  CHARLES W. DENT, Pennsylvania
  E. SCOTT RIGELL, Virginia


  NOTE: Under Committee Rules, Mr. Rogers, as Chairman of the Full Committee, and Mrs. Lowey, as Ranking
  Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees.

                Susan Ross, John Bartrum, Allison Deters,
              Jennifer Cama, Justin Gibbons, and Lori Bias,
                            Subcommittee Staff
                           _______________

                                  PART 5

                                                                   Page
  Budget Hearing--Department of Health and Human Services..........   1
                                                                  
                                    
  Oversight Hearing--The Vital 
Responsibility of Serving the Nation's 
Aging and Disabled Communities..................................    107
                                                                 
                                   
  National Institutes of Health.................................    183
                                                                 
                                                                   
                                        
  Department of Education.......................................    309
                                                                 
                                                                    
                                        
  Department of Labor..........................................     389
                                                                  
                                                                    
                                        
  Oversight Hearing--Closing the 
Achievement Gap in Higher Education............................     507




                                                                  
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]                                                                  
                                        



          Printed for the use of the Committee on Appropriations
                          _______________

                  U.S. GOVERNMENT PUBLSHING OFFICE

  96-204                 WASHINGTON : 2015
                           


 
                      COMMITTEE ON APPROPRIATIONS
                                                       
                   HAROLD ROGERS, Kentucky, Chairman


  RODNEY P. FRELINGHUYSEN, New Jersey            NITA M. LOWEY, New York
  ROBERT B. ADERHOLT, Alabama                    MARCY KAPTUR, Ohio
  KAY GRANGER, Texas                             PETER J. VISCLOSKY, Indiana
  MICHAEL K. SIMPSON, Idaho                      JOSE E. SERRANO, New York
  JOHN ABNEY CULBERSON, Texas                    ROSA L. DeLAURO, Connecticut
  ANDER CRENSHAW, Florida                        DAVID E. PRICE, North Carolina
  JOHN R. CARTER, Texas                          LUCILLE ROYBAL-ALLARD, California
  KEN CALVERT, California                        SAM FARR, California
  TOM COLE, Oklahoma                             CHAKA FATTAH, Pennsylvania
  MARIO DIAZ-BALART, Florida                     SANFORD D. BISHOP, Jr., Georgia
  CHARLES W. DENT, Pennsylvania                  BARBARA LEE, California
  TOM GRAVES, Georgia                            MICHAEL M. HONDA, California
  KEVIN YODER, Kansas                            BETTY McCOLLUM, Minnesota
  STEVE WOMACK, Arkansas                         STEVE ISRAEL, New York
  JEFF FORTENBERRY, Nebraska                     TIM RYAN, Ohio
  THOMAS J. ROONEY, Florida                      C. A. DUTCH RUPPERSBERGER, Maryland
  CHARLES J. FLEISCHMANN, Tennessee              DEBBIE WASSERMAN SCHULTZ, Florida
  JAIME HERRERA BEUTLER, Washington              HENRY CUELLAR, Texas
  DAVID P. JOYCE, Ohio                           CHELLIE PINGREE, Maine
  DAVID G. VALADAO, California                   MIKE QUIGLEY, Illinois
  ANDY HARRIS, Maryland                          DEREK KILMER, Washington
  MARTHA ROBY, Alabama
  MARK E. AMODEI, Nevada
  CHRIS STEWART, Utah
  E. SCOTT RIGELL, Virginia
  DAVID W. JOLLY, Florida
  DAVID YOUNG, Iowa
  EVAN H. JENKINS, West Virginia
  STEVEN M. PALAZZO, Mississippi

 

                William E. Smith, Clerk and Staff Director

                                   (ii)
                                   
                                   
                                   


DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, EDUCATION, AND RELATED 
                    AGENCIES APPROPRIATIONS FOR 2016

                              ----------                              


                                     Wednesday, February 25, 2015.

        BUDGET HEARING--DEPARTMENT OF HEALTH AND HUMAN SERVICES

                                WITNESS

HON. SYLVIA BURWELL, SECRETARY, DEPARTMENT OF HEALTH AND HUMAN SERVICES

                           Opening Statement

    Mr. Cole. Good morning. It is good to have you here, Madam 
Secretary. And let me go ahead and make an opening statement, 
and then we will move on from there.
    So, again, good morning. Good to have you here. It is my 
pleasure to welcome you to the Subcommittee on Labor, Health 
and Human Services, and Education for our very first hearing of 
the year and my first hearing as chairman. So I am honored to 
be able to share that with you and looking forward to your 
testimony.
    I want to add quickly on a personal note, I had the 
opportunity to meet you, thanks to my good friend Mr. Womack, 
sometime ago and facilitated that relationship when you were at 
OMB, and I want to tell you how much I admired and appreciated 
your services there.
    Working with you in your current capacity when you had the 
challenge of the influx of illegal immigrant children in the 
summer, you were extremely helpful. I had 1,200 of those--or up 
to 1,200 that were going to be stationed at Fort Sill. You 
worked with us very well.
    So, again, my experiences with you have all been positive 
and productive. So it is great to have you here.
    As I have been coming up to speed as the new chairman, I 
have been learning more and more about the astonishing range of 
programs under your jurisdiction. From overseeing research that 
we hope will cure diseases like cancer and Alzheimer's to 
protecting our people from Ebola and the flu, to providing 
child care and early learning to our youngest Americans, to 
training our next generation of medical professionals and 
administering health insurance for our Nation's poor and aging 
populations, your responsibilities are broad, great, and 
numerous.
    There are many things in your budget that I think we can 
all agree are priorities and that we can collectively support. 
There are others where we may well disagree. The challenge that 
will be facing this subcommittee is how we can support the most 
critical programs, the investments that will give Americans the 
greatest bang for the buck, so to speak, with the limited 
resources that we will have available to us.
    Your budget assumes an array of tax increases, new user 
fees, changes in mandatory spending, and other spending sources 
that are beyond the purview of this subcommittee. You use these 
funds to pay for increases in popular programs.
    In my opinion, we will not be able to do everything you are 
proposing. I look forward to having a discussion with you this 
morning about the top priorities in your department. From your 
perspective, where should we actually invest the taxpayer 
dollars that are at our disposal? If we cannot fund everything 
you request, where would you prefer us to focus our limited 
dollars?
    I would also be remiss if I did not point out many of the 
management challenges facing you at the helm of HHS. From the 
continuing problems with administering Obamacare to contracting 
irregularities, backlogs, and complaints from medical 
professionals, there seem to be no shortage of areas in need to 
managerial improvement, an area, frankly, in which you have 
proven repeatedly you excel. I hope to learn more this morning 
on what you are doing to take positive steps in these areas and 
where we can assist you.
    Finally, there are many external challenges facing your 
agency. Threats to cybersecurity, threats from diseases like 
Ebola and antibiotic-resistant bacteria, and the many 
challenges of poverty also land at your doorstep. I look 
forward to hearing your ideas on how to combat these this 
morning as well.
    As a reminder to the subcommittee and our witness, we will 
abide by the 5-minute rule so that everyone will have a chance 
to get their questions asked and answered.
    Before we begin, I would like to yield to the gentlelady 
from New York, our ranking member, for any opening statement 
she would care to make. I yield to the ranking. Yes, ranking 
member of the entire committee.
    Ms. DeLauro. Oh, okay. [Laughter.]
    Mr. Cole. And then--sorry.

                           Opening Statement

    Mrs. Lowey. Welcome. I would like to thank Chairman Cole 
and Ranking Member DeLauro for holding this hearing today.
    Chairman Cole, welcome back to the subcommittee. It has 
been my pleasure working with you on these issues, so many 
other issues. I look forward to working together, and certainly 
with Chairman Rogers, Ranking Member DeLauro, to continue 
funding these important investments.
    And to Secretary Burwell, we are so pleased to have you 
here today. And as I look at you and as we have talked, I think 
how fortunate we are to have a person of your experience and 
your commitment in public service. So thank you for taking on 
the responsibilities of this very important committee, and I 
know that we will work together in a bipartisan way to ensure 
that the critical priorities are adequately funded.
    You come before us with a budget request of 
$75,800,000,000, amounting to an increase of $4,200,000,000 in 
discretionary funding. Your request includes welcome policy 
proposals that will fund medical breakthroughs, provide 
affordable child care for working families, and create jobs.
    The department's budget is symbolic of the President's 
budget as a whole in that it calls for investments in research, 
education, training, infrastructure--all vitally important and 
interconnected. These investments are necessary not only to the 
health infrastructure but are crucial to growing our economy 
and creating jobs.
    Throughout my time in Congress, Federal funding for the 
National Institutes of Health has been among my top priorities. 
Your NIH budget would include an increase of $1,000,000,000, 
resulting in 1,200 new additional competitive research grants 
in fiscal year 2016.
    The NIH budget would make welcome investments in advanced 
cancer treatments with the new Precision Medicine Initiative, 
would increase funding for the BRAIN Initiative to research the 
workings of the brain, development treatments to combat 
Alzheimer's disease, autism, and other neurological and 
psychiatric conditions. It would also better the lives of 
working families and provide children with the building blocks 
to succeed throughout their lives.
    I was very pleased to see the President's requested 
increase of $1,500,000,000 to expand Head Start to full-day, 
full-year services and to expand Early Head Start programs for 
infants and toddlers.
    Now, Mr. Chairman, you reference how do we save money? How 
do we set priorities? The President has also called for an end 
of the mindless austerity of sequestration, urging Congress to 
replace it with more targeted spending cuts, program integrity 
measures, and the closure of some outdated tax loopholes.
    The effects of sequestration were immense, are still being 
felt. Across the Government, we see instances where training 
was postponed, routine investments were put off, and research, 
especially the critically important research funded in this 
bill, was abruptly halted. It really was a worst-case scenario 
for many agencies such as the NIH, and we have to make sure 
that it does not happen again.
    As we begin the annual process of crafting a budget 
resolution, a fiscal blueprint, I know there will be many 
viewpoints represented in the debate. Many of my colleagues on 
the other side of the aisle will undoubtedly press on for 
additional cuts to leave the outdated sequester-level caps in 
place. But I think we all know now how dangerous that is and 
how we must do everything we can to avoid a repeat of 
sequestration.
    We have forged compromise in the past. The Murray-Ryan plan 
was not perfect but does provide a path forward for another 
budget deal. Without such an agreement, our appropriations 
process is deeply imperiled. Discretionary funding is falling 
to its lowest level as a percentage of GDP since the Eisenhower 
administration.
    So we must act again to ensure reasonable allocations for 
the important programs and investments funded through the 
appropriations process, especially those under the jurisdiction 
of the committee. This bill provides critical Federal funding, 
some of the most important priorities of the American people, 
groundbreaking health and science research, valuable education 
programs, job training programs designed to keep this country 
globally competitive. The dollars we invest in these programs 
matter.
    I look forward to your testimony today, Secretary Burwell, 
and to hear your agency's plan for the coming fiscal year.
    And I thank you again, Mr. Chairman, and welcome back.
    Mr. Cole. Well, I thank my friend, the gentlelady from New 
York.
    And with that, I would like to recognize my ranking member, 
the ranking member of this subcommittee, the gentlelady from 
Connecticut.

                           Opening Statement

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    And good morning, Madam Secretary.
    Mr. Chairman, congratulations to you, and I look forward to 
working with you on these--the efforts that are involved in 
this subcommittee.
    Before I begin, let me mention to you, Mr. Chairman, that 
our colleague Congresswoman Barbara Lee is not here this 
morning and would very much like to be, but I think we know 
that her mother passed away just a few days ago, and so she is 
in California tending to personal family and so forth. And I 
know we send her our thoughts and our prayers.
    Madam Secretary, welcome to you in your first hearing with 
this subcommittee. I would like to express my gratitude for the 
work you and your department do. I know your job can be a 
thankless one. Everyday successes are overlooked while the 
mistakes get magnified.
    I want to highlight two areas of your work. First, your 
efforts to implement the Affordable Care Act. The Affordable 
Care Act is helping millions of families across our country.
    Americans can no longer be denied coverage for preexisting 
conditions. Preventive screenings, maternity care, pediatric 
care are now covered. Women's health has been put on an even 
footing. Millions of low-income children have healthcare 
through CHIP.
    Insurers can no longer subject families to lifetime caps on 
coverage. And as we heard from HHS yesterday, the Affordable 
Care Act is making prescription drugs more affordable for 
seniors every year. As a result, 9.4 million people on Medicare 
have saved over $15,000,000,000 since 2010.
    Premiums are down. Enrollment is up. Nearly 20 million more 
Americans will have health insurance this year, thanks to the 
Affordable Care Act. This growth in coverage is particularly 
strong among historically underserved communities like African 
Americans and lower-income Americans.
    The Congressional Budget Office recently cut its estimate 
of the cost of expanding coverage, a saving of $140,000,000,000 
compared to previous estimates. That speaks to the strength of 
your department's leadership.
    Second, I want to recognize your measured response to the 
Ebola outbreak. Instead of bowing to pressure for travel bans 
and quarantines, you and your colleagues listened to the public 
health experts. You helped to coordinate a Government-wide 
response that is both turning the tide of infection in West 
Africa and protecting the public health here at home.
    The Ebola crisis is a horrific reminder of the need to 
provide adequate funding for public health institutions under 
the jurisdiction of this subcommittee, like the CDC, the NIH, 
and BARDA. Which brings me to the topic of today's hearing, the 
HHS budget for fiscal year 2016. Programs funded through this 
budget provide lifelines to millions of Americans.
    LIHEAP frees working families from the impossible choice of 
whether to heat their homes or put food on the table. The 
National Institutes of Health pursue lifesaving treatments. A 
30-year cancer survivor myself, I know the value of biomedical 
science.
    Another crucial HHS program, Head Start, is 50 years old 
this year, and during that time, it has helped to level the 
playing field for over 30 million low-income preschoolers. As 
the father of Head Start, Ed Zigler, put it, ``My politics is 
children.'' And I am very proud of Ed Zigler since he is a 
constituent of the 3rd District of Connecticut.
    As our population grows, so does the demand for vital 
programs--Head Start, LIHEAP, the NIH. We need to provide them 
with the resources that keep pace both with need and with 
inflation. After years of neglect, your budget request begins 
to get us back on the right track. I would argue that it does 
so too slowly, but I recognize that the overall budget must 
walk a fine line in that regard.
    There is a lot of good in this request. It substantially 
increases funding for early childhood through Head Start. It 
includes $500,000,000 for a multiagency effort against 
antibiotic-resistant superbugs. It provides an additional 
$1,000,000,000 for NIH, including funding for a new Precision 
Medicine Initiative.
    Current levels of funding across HHS programs remain 
woefully inadequate. This is largely the result of what in 
Washington is called sequestration, a disastrous policy of 
arbitrary cuts and spending caps. Applied to the HHS budget, 
these cuts and caps are jeopardizing the health of millions of 
Americans. As is too often the case, low-income families are 
the hardest hit.
    Since 2010, after adjusting for inflation, the Labor, HHS 
budget has lost almost $20,000,000,000. These cuts mean less 
money for medical research, less money for public health, and 
less money for other critical priorities across the Labor, HHS 
bill.
    The inflation-adjusted numbers for the past 5 years tells a 
dismal story. The Health Resources and Services Administration 
has seen its discretionary budget cut by a quarter, reducing 
services for more than 25 million low-income patients who rely 
on community health centers.
    Between them, the NIH and the CDC have been cut by more 
than $4,800,000,000. That is a disaster for American public 
health. We must do better. We need to eliminate the sequester 
caps once and for all, return to adequate levels of funding to 
support our Nation's health. This budget request starts to do 
that.
    We must invest in the NIH, accelerate breakthroughs against 
diseases like cancer, invest in Head Start to bring benefits of 
a full-day, year-round service to young children whose need is 
greatest. We need to invest in public health, strengthen our 
country in the fight against measles, meningitis, Ebola, and 
the obesity epidemic. These are examples of critical programs 
that help to improve the health of our Nation.
    We can and we must find the resources to support them. I do 
not agree with every proposal in the President's budget. I am 
disappointed to see reductions in cancer screening and the 
graduate training in children's medicine, level funding of the 
LIHEAP program.
    But this request does at least show what is possible if we 
come to our senses, reverse these shortsighted sequester cuts. 
For the good of all Americans, we need to do this and do it 
soon.
    I look forward to your testimony and to our questions.
    Mr. Cole. We have now been joined by ``the big chairman,'' 
as he is affectionately known. So I will recognize Chairman 
Rogers for whatever opening remarks he cares to make.

                           Opening Statement

    Mr. Rogers. Mr. Chairman, thank you very much for yielding, 
and congratulations on your very first hearing as chairman of 
this important subcommittee, as we discuss the 2016 budget 
request for HHS.
    And it is great to see the Secretary join us. Thank you 
very much. It is a thrill to know that the new Secretary of 
this huge department of the Federal Government hails from just 
across the State line from Ashland, Kentucky.
    Madam Secretary, we are proud of you and wish you well in 
this new venture. You did a great job over at the Budget Office 
and other chores.
    Undoubtedly, you have taken the reins of this big 
department during a tumultuous time in our history. The rollout 
of the President's healthcare law has been undeniably 
underwhelming. Our healthcare costs remain among the highest in 
the developed world. And despite Obamacare's broad reach and 
unfathomable price tag, many still remain without access to 
basic health services, particularly in rural areas.
    In the face of numerous public health challenges, from the 
Ebola outbreak abroad to the epidemic of prescription drug 
abuse here at home, we are facing a budget crunch that requires 
tough decisions in order to maintain continued investment in 
lifesaving and breakthrough medical research, as well as 
prevention and treatment initiatives.
    Unquestionably, much of this crunch is driven by 
unsustainable growth in mandatory spending, which hamstrings 
all of us as we seek to make these tough calls. Unfortunately, 
we have seen no leadership from the White House on your agency 
to address the billion-dollar elephant in the room, and that is 
mandatory spending.
    I want to take a moment to point out in that regard since I 
have chaired this committee these 4 years, we have actually cut 
$165,000,000,000 from discretionary spending while all the same 
time, the mandatory spending has increased dramatically and 
continues.
    When I first came to Congress, entitlements amounted to 
about a third of the Federal spending. Now it is more than two-
thirds. We only appropriate a third of what Federal spending 
takes place, and that includes, of course, your department.
    Your challenges are many, and I want to hear how you plan 
to tackle these and other issues, which play so prominent a 
role in the lives of every American. In particular, I would 
like to thank you, Madam Secretary, for your attention to the 
issue of prescription drug abuse, which has been designated by 
CDC as a national epidemic, and that is especially so in my 
district, all of east Kentucky.
    You have personally spoken about the need to address the 
crisis. I know that many are anxiously awaiting your comments 
at this year's prescription drug abuse summit in Atlanta, put 
together by the organization I formed in my district called 
UNITE to try to stop the problem.
    Your budget request reflects your commitment to doing your 
part in a holistic, multipronged Federal response to this 
problem. In fact, there is more people dying from prescription 
drug overdose than automobile accidents in this country, and 
that is just not acceptable.
    I have long advocated that treatment and education need to 
play a critical role in this unique public health challenge. 
And CDC, SAMHSA, ONC, and AHRQ, along with the research 
branches of your agency, all have a part to play.
    I am also pleased that HHS is focusing on leveraging our 
existing State-run prescription drug monitoring programs with 
new eHealth technologies to make PDMPs more user-friendly for 
the medical community and encouraging the development of 
evidence-based opioid prescribed guidelines to ensure that 
these powerful, addictive medications are being appropriately 
and safely prescribed. I look forward to hearing more about 
this $99,000,000 interagency initiative and working with you on 
this shared goal.
    We also want to hear about Obamacare. As predicted since 
its passage, there have been many hiccups and issues with its 
implementation. Many of my constituents who were promised by 
President Obama that they could keep their plan and keep their 
doctor are upset because their plans have been canceled, and 
they no longer have access to their doctor of choice. Premiums 
have also increased dramatically, and my constituents are 
paying more for less health insurance coverage.
    Hospitals in my area are starting to see more and more bad 
debt because patients cannot afford the incredibly high 
deductibles required by their new health insurance plans. 
Hospital bills are going unpaid. I fear, unfortunately, that 
this situation is not unique to my part of the world in 
southern and eastern Kentucky. While issues like these continue 
to unfold around the country, this year's budget requests more 
money to feed this monster.
    For the Centers for Medicare and Medicaid Services program 
management, your budget request is $4,200,000,000, an increase 
of $270,000,000. That kind of growth is just not sustainable.
    In addition, your request included several added user fees 
that will wreak havoc on healthcare providers, especially those 
in rural areas. One example is the administration's proposal to 
collect a user fee for each purchase of 340B drugs from 
entities participating in the drug price reduction program.
    The budget claims this money will be used to enhance the 
program's integrity efforts, and yet the 2015 omnibus provided 
$10,000,000 in discretionary funding for that very purpose. 
Trying to collect this fee from doctors and hospitals that are 
providing healthcare services to disadvantaged and rural 
communities just does not make sense.
    Finally, Madam Secretary, the budget also proposes changes 
to critical access hospitals that could have a very adverse 
impact in rural communities. These hospitals provide care in 
areas with very limited healthcare access.
    Many rural people depend on the 24-hour emergency services 
offered by these facilities in my district, sparsely populated 
and full of dangerous mountain roads. We have several critical 
access hospitals that are doing a great job providing necessary 
health services to their communities.
    In many situations, if hospitals were not available, 
patients in life-threatening situations would have to drive 30 
minutes at least to the closest medical facility with emergency 
services. This might mean life or death for someone 
experiencing a fatal heart attack or stroke.
    Reducing the rate at which these hospitals are reimbursed 
and reducing the distance requirement to maintain a critical 
access hospital designation will have a very detrimental impact 
on these healthcare facilities and the people who depend on 
their services.
    Madam Secretary, we look forward to hearing your testimony. 
Thank you for being here.
    I yield.
    Mr. Cole. Thank you.
    Madam Secretary, your full statement will be entered into 
the record, and you are now recognized for 5 minutes.

                           Opening Statement

    Secretary Burwell. Thank you. Thank you, Chairman Cole, 
Ranking Member DeLauro, Ranking Member Mrs. Lowey, and Chairman 
Rogers.
    Thank you all, and to the members of the committee, I want 
to thank you for this opportunity to discuss the President's 
budget for the Department of Health and Human Services.
    I believe firmly that we all share common interests, and 
therefore, we have a number of opportunities to do common good. 
From preventing and treating substance abuse, as the chairman 
just mentioned, to advancing the promise of precision medicine, 
and to build an innovation economy as well as strengthening the 
American middle class, the budget before you makes critical 
investments in healthcare, science, innovation, and human 
services.
    It maintains our responsible stewardship of the taxpayer 
dollar. It strengthens our work together with Congress to 
prepare our Nation for key challenges both at home and abroad. 
For HHS, it proposes $83,300,000,000 in discretionary budgetary 
authority, $75,800,000,000 of which is for activities that are 
under this subcommittee.
    This $4,800,000,000 increase will allow our department to 
deliver impact today and lay a strong foundation for tomorrow. 
It is a fiscally responsible budget, which, in tandem with 
accompanying legislative proposals, would save taxpayers a net 
estimated $250,000,000,000 over the next decade. In addition, 
it is projected to continue slowing the growth in Medicare 
costs, and it could secure $423,000,000,000 in savings as we 
build a better, smarter health delivery system.
    In terms of providing all Americans with access to quality 
affordable healthcare, it builds on our historic progress in 
reducing the number of uninsured and improving coverage for 
families who already had insurance. We saw a recent example of 
this progress with the about 11.4 million Americans who have 
either signed up or re-enrolled in health insurance through the 
marketplaces in this past open enrollment.
    Our budget extends CHIP for 4 years. It covers newly 
eligible adults in the 28 States, plus D.C. which have expanded 
Medicaid. And it improves access to healthcare for Native 
Americans.
    To support communities throughout the country, including 
underserved communities, it invests $4,200,000,000 in health 
centers and $14,200,000,000 to bolster our Nation's health 
workforce. It supports more than 15,000 National Health Service 
Corps clinicians serving nearly 16 million patients in high-
need areas, and it helps with health disparities.
    With the funding streams ending in 2016, millions stand to 
lose access to primary care services and providers if we do not 
take action. To advance our common interest in building a 
better, smarter, and healthier delivery system, it supports 
improvements to the way care is delivered, providers are paid, 
and information is distributed.
    On an issue for which there is bipartisan agreement, it 
replaces Medicare's flawed sustainable growth rate formula and 
supports a long-term policy solution fix to the SGR. The 
administration supports the type of bipartisan, bicameral 
efforts that Congress undertook last year.
    To advance our shared vision for leading the world in 
science and innovation, it increases funding for NIH by 
$1,000,000,000 to advance biomedical and behavioral research. 
In addition, it invests $215,000,000 for the Precision Medicine 
Initiative, a new cross-department effort focused on developing 
treatments, diagnostics, and prevention strategies that are 
tailored to an individual's genetic makeup.
    To further our common interest in providing for Americans 
the building blocks of healthy and productive lives at every 
stage of life, this budget outlines an ambitious plan to make 
affordable quality child care available to every working and 
middle-class family. It supports evidence-based interventions 
to protect youth in foster care, and it invests to help older 
Americans live with dignity in their homes and communities.
    To keep Americans healthy, the budget strengthens our 
public health infrastructure with $975,000,000 for our domestic 
and international preparedness, including critical funds to 
implement the Global Health Security Agenda. It also invests in 
behavioral health services and substance use prevention.
    Finally, as we look to leave our department stronger, the 
budget invests in our shared priorities of cracking down on 
waste, fraud, and abuse. We are also addressing our Medicare 
appeals backlog, and taken together, we believe this budget 
advances our broader goals of bringing middle-class economics 
to the 21st century, providing Americans with those building 
blocks of healthy and productive lives.
    As I close, I want to make one final point, and that is 
that I am personally committed to responding quickly and 
thoughtfully to the concerns and communications with Members of 
Congress and especially this committee. And since I have been 
confirmed, I have made it a top priority for our department to 
do that.
    And lastly, I also just want to take a moment to thank the 
employees of HHS. From their work combating Ebola to their 
compassion assisting those unaccompanied children, to the 
commitment they show every day to help our fellow Americans, I 
look forward to working closely with you on behalf of the 
American people.
    And with that, I look forward to your questions. Thank you.
    [The information follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Cole. Well, Madam Chairman, your reputation for 
responsiveness precedes you. So we know you are certainly as 
good as your word in that regard.
    Just for the committee, I am going to--our chairman and our 
ranking member have very heavy schedules today, and so I am 
going to go ahead and recognize them first so they can ask what 
other questions they need to pose to you and can go on their 
way if they choose to do so.
    So, Mr. Chairman.
    Mr. Rogers. Mr. Chairman, thank you. That is very kind of 
you to be so considerate.

                       CRITICAL ACCESS HOSPITALS

    Just as a side note, we are starting our hearing season 
with gusto. There is five hearings today at the various 
subcommittees at which five different Cabinet Secretaries will 
be appearing. So, but we appreciate you being here, and thank 
you, Mr. Chairman, for that courtesy.
    Let me ask you, Madam Secretary, about critical access 
hospitals. A licensed hospital with a maximum of 25 beds and 
24-hour emergency service located in a rural area, which meets 
one of the following criteria--over 35 miles from another 
hospital or is over 15 miles from another hospital in 
mountainous terrain or areas with only secondary roads. I have 
seven of those hospitals in my district alone.
    And in your 2016 budget request, you propose two major 
changes. One, you would prohibit critical access hospital 
designation for facilities that are less than 10 miles from the 
nearest hospital and, two, reduce critical access hospital 
reimbursements from 101 percent of reasonable costs to 100 
percent of reasonable costs.
    The proposed distance change really does not take into 
consideration, in my judgment, the terrain and the difficult 
road situation in many rural areas. And Madam Secretary, I know 
where you lived, and you know there are some mountainous roads 
and terrain that are formidable in that part of Kentucky and 
West Virginia.
    And the economic situation in that region is almost 
disastrous because of the mine layoffs. I have got 9,000 laid-
off miners in my district alone. So the economic situation is 
terrible. To encourage healthcare facilities to take root in 
these hard-to-serve communities, these critical access 
hospitals are absolutely vital.
    You may be aware that we have some very unique health 
challenges in my area as well. Obesity, a major problem, 31.1 
percent of Kentuckians classified as obese. Sixty-six percent 
overweight. Diabetes, unfortunately, prevalent. Ten percent 
rate among Kentucky adults. Cancer having a huge impact on 
Kentucky, where, according to the CDC and the American Cancer 
Society, there are 9,600 deaths out of 2,400 incidences per 
year.
    These are very troubling statistics, and I believe the 
problem is magnified in these rural areas across the country, 
but especially in areas like my district.
    In the 2015 CRomnibus report language, CMS was asked to 
provide a report about how the proposed 10-mile limit would 
impact access to services in rural communities, including the 
analysis and criteria. I have not seen that report, and I think 
it has not yet been filed. Are you familiar with it?
    Secretary Burwell. Not familiar, that this is one of the 
reports, there is another report that was included in the 
CRomnibus that was related to language. This one I am not, but 
I will look into it. We have done some of the analysis around 
this issue, and so we will work and follow up on that.
    Mr. Rogers. Do you appreciate what I have been saying about 
the critical need of these hospitals and that in difficult 
terrained areas, the 10-mile limit is very important here?
    Secretary Burwell. Mr. Chairman, the suite of issues that 
you described, as you mentioned in your opening remarks, we 
live in areas that are very close to each other and, therefore, 
very similar. And the issues of rural health issues altogether, 
the team at HHS knows now anything that comes before me, that 
is one of the first questions. How does it impact rural 
America? So----
    Mr. Rogers. Would you--would you seek out the report that I 
mentioned?
    Secretary Burwell. I will do that.
    Mr. Rogers. See if we can get----
    Secretary Burwell. I will. I know that we have looked at 
the analysis, and what I am hearing, because the analysis for 
the Nation as a whole is that this would impact, the 10-mile 
issue would impact only 5 percent of hospitals and that what we 
would be doing is trying to preserve that access to emergency 
care, those economic issues that you are talking about, making 
sure that we are using the taxpayers' monies wisely, and 
balancing those issues.
    The numbers that you are giving me in your district are 
disproportionate to the numbers I have seen. So I want to 
follow up on that.
    Mr. Rogers. Well, I think that all of that 5 percent you 
mentioned is in my district.
    Secretary Burwell. That is why, when you give me those 
numbers, those are not the numbers that I have seen as we 
reviewed this policy. So I want to make sure we understand 
that.
    Mr. Rogers. And then there is----
    Secretary Burwell. And the broader issues, I just want to 
recognize across the budget and whether it is how we are 
funding CDC, the community health centers, the issues of the 
Public Health Service Corps, making sure that rural America has 
access to the needs--to healthcare and that whether it is 
behavioral health or primary care or, you know, the range of 
care is something that I consider a very important priority.
    Mr. Rogers. And then there is the impact to the hospitals 
themselves, the economic impact. In my area, many of these 
hospitals are struggling just to keep the doors open. How would 
that change in the reimbursement rates affect healthcare?
    Secretary Burwell. So in terms of the broader picture as we 
think about these rural hospitals and what is happening in 
those rural hospitals, in the State of Kentucky, just about 10 
days ago, there was a study that was released by Deloitte and 
the University of Louisville in terms of what the impact has 
been for both jobs and the GDP in the State. And it said that 
there would be 40,000 in terms of the number of jobs that will 
be created from some of the health changes that have occurred--
that is the expansion of Medicaid mainly that is causing that--
as well as additions to the GDP that would be around 
$40,000,000,000 by 2021.
    And so, that influx also of now having care that is paid 
for is something that we are seeing, both anecdotally and now 
analytically, through that piece of work that has been done in 
Kentucky in terms of those hospitals getting money. And it is 
across all over the country where we are seeing, as people have 
money to pay for insurance, that those hospitals--that is one 
of the things that we are working on and believe will help some 
of those hospitals.
    Mr. Rogers. I thank you. Briefly and quickly, travel 
expenses.
    Secretary Burwell. Yes, sir.

                             TRAVEL POLICY

    Mr. Rogers. A local paper recently pointed out that HHS has 
spent over $31,000,000 on 7,000 first and business class 
flights for employees from 2009 to 2013--CDC, NIH, FDA. Seventy 
percent to 80 percent of the premium tickets were due to the 
use of medical exceptions to accommodate a special physical 
need.
    Those are very large numbers. I am popping this to you from 
the clear blue sky. You are not prepared to answer, I guess. 
But could you tell us what the travel policies are? That is a 
lot of money for flying.
    Secretary Burwell. So I think those numbers are over a 
period of time, and I know that we have put in more stringent 
review and requirements----
    Mr. Rogers. Four years. It is 4 years.
    Secretary Burwell. It is a 4-year period, and I think in 
the past several years, we have put in place more stringent 
review and requirements. So we would want to look and see if 
that is making a difference in the numbers.
    The overall is about 3 percent, and it is in limited 
circumstances, as you describe, health circumstances or types 
of things like 14-hour trips. But I think it merits looking at 
if we are seeing a decline from the more stringent requirements 
that we have put in place.
    Mr. Rogers. Would you check into it?
    Secretary Burwell. I will do that.
    Mr. Rogers. Mr. Chairman, thank you.
    Mr. Cole. Thank you, Mr. Chairman.
    The gentlelady from New York is recognized.
    Mrs. Lowey. Thank you.
    And again, welcome, Secretary Burwell. I just want to 
follow up on the hospital questions of the chairman. I am 
really quite shocked with those numbers. So I am glad I live in 
New York.
    But on the hospital issue, as we saw with Ebola 
preparedness and the cases that were identified last year, 
local hospitals and doctors are on the front line during health 
emergencies, and Congress provided additional emergency funding 
for the Hospital Preparedness Program in fiscal year 2015. But 
hospitals in my community tell me that the funds they have 
received from the program in previous years are inadequate.
    So if you could share with us the President's 2016 request, 
how are we helping the hospitals prepare for and respond to 
emergencies? Many of them put on extra rooms just to be sure 
that they were prepared, and this is a very important account.
    And by the way, I am delighted that you mentioned community 
health centers because they are providing such important 
services, certainly in my communities. So if you can address 
that account, that would be very helpful.
    Secretary Burwell. So the issue of hospital preparedness 
specifically, I think, is nested in the broader issue of our 
preparedness as a nation when we have issues like we did with 
Ebola. And it is across the system that we need to be prepared, 
and that is both in terms of the State and local public health 
systems that are in place, as well as those hospitals that are 
in place.
    And so, funding across all of those pieces is important to 
make sure that the system works because where there is a fault 
in one place, I am not sure everyone here read, but many of you 
may have read that this morning I, of course, had a person 
under investigation notice in Bellevue Hospital in New York in 
terms of we are still tracking people that come and making sure 
on the Ebola front. So it is across that whole spectrum.
    With the money--and thank you. First, let me express 
appreciation with the $2,700,000,000 that we received to work 
on Ebola. Appreciate it. We are moving those monies quickly. 
And as you probably know, on Friday, we announced the funding 
announcement so that requests can come in from States to do a 
portion of that funding that would occur to the hospitals.
    So we are using both those monies, as well as the monies in 
the 2016 budget proposal to make sure that we get to the levels 
of preparedness that we need to as a nation.
    And one of the things in terms of that preparedness is, and 
we were directed by the Congress, which we agree with, is to 
put in place a regional strategy for Ebola and making sure that 
we have a set number of hospitals that are prepared for the 
most extreme situation, a number of hospitals that can then 
support that effort and also do care.
    And then what we would consider hospitals that analyze and 
make sure a patient is determined whether they should be 
somewhere. And then there is the front line. Making sure that 
that front line hospital knows this is something suspicious. I 
need to get it to someone who can handle it.
    And so, there is a strategic overlay and then the financial 
overlay in terms of how we are trying to address the issue.
    Mrs. Lowey. I would appreciate continuing to work with you 
on that issue because, as you know, many of the local hospitals 
do not know what a person is bringing in when they come in with 
105 fever. And so, they are looking at decontamination units, 
et cetera.
    So I know we agree on both sides of the aisle that we do 
not want to be wasting money, but you need to invest in areas 
where the funding is very critical.

                                 AUTISM

    I want to mention one other area because we have been doing 
a lot of work with autism, ranging from research at the NIH to 
workforce training programs at HRSA. I would be interested if 
you would share with us how your fiscal year 2016 budget 
request would help the increasing number of families who are 
living with autism.
    What we are seeing is some very exciting investments in 
work placement for these young people, not so young, as really 
they age out of their school opportunities. So I am really 
interested in just a brief overview of what you are doing.
    Secretary Burwell. I think it is in the two areas that you 
have articulated. One is in the research space. And as you 
mentioned in your opening statement, the issue of the BRAIN 
Initiative and the investments we are making in research, where 
we can understand better the issues around autism, both cause 
and how we can work through it when there are cases. And so, 
the research is a big part of it, and that is part of the BRAIN 
Initiative.
    The other place in the department where this sits is in the 
Administration for Community Living and making sure that we are 
working with our colleagues, in some cases, the Department of 
Labor, but also as we think about how people have community-
based living and working on those issues there. So those are 
the two main areas that the funding and the budget addresses 
this issue.
    Mrs. Lowey. Thank you, Mr. Chairman.
    And I just want to say to ``the big chairman'' and ``the 
very big chairman,'' I know we all look forward to working with 
you and with the Secretary. We all want to cut out waste for 
programs that are not really working because your 
responsibilities are so very important that you do not want to 
cut in areas that are really critical.
    And this is why the sequestration issue, and I know the big 
chairman and I have had many conversation on this. It just does 
not make any sense. So I hope as we move forward, we can 
address the basic funding issues that would give you the 
opportunity to continue to improve lives.
    Thank you.

                           BUDGET PRIORITIES

    Mr. Cole. Thank you.
    Let me pick up from there. That is actually a very nice 
lead-in, which is not unusual for my good friend from New York 
and I to see these things in a similar fashion.
    As I suggested in my opening remarks, I have concerns that 
your budget is based on financial tax increases and fees that 
are unlikely to pass and actually become law. So I think your 
number is probably a little bit higher than we are going to end 
up with in this committee.
    Given that fact or given that possibility, and again, it 
could always change if there is a larger deal that involved the 
President and the congressional leadership, but absent that, 
what would be--if we had to operate on roughly the same amount 
of money we had last year, how would you prioritize that? What 
are the most important things from your perspective that you 
would really like to see accomplished?
    Secretary Burwell. So, Mr. Chairman, when we put together 
the budget, as we put together a budget, and I am now a piece 
of it. I used to be in a seat that brought all the pieces 
together. But what we have tried to do is make those choices 
and articulate where we believe the choices should be made, and 
those are choices that I believe, you know, we all need to 
discuss.
    But those are important choices, and one of the reasons 
that I think they are extremely important choices is, you know, 
it is a cap, but it is sequester. It is a policy that I think 
many did not expect to be in place. And whether you did or you 
did not, I actually think we should put that aside, but 
actually put through and view it from the lens of what is the 
actual impact?
    And when we think about the levels when you say about the 
choices and what happens at these lower levels, I think it is 
important to hearken back to what happened in 2013 when we 
were, for a period of time, at what we would call a sequester 
level. And let me just give two examples.
    One is at NIH. During that time, at NIH we had the lowest 
number of grants that we were doing for project research that 
we have in a decade's time. In Head Start, 57,000 children lost 
their Head Start.
    And so, I understand that these are tough choices. I 
understand why this is not, you know, in terms of the 
jurisdiction, it goes well beyond this committee to many other 
committees as well. But I just think we have to--you know, part 
of what we tried to do in our budget is be responsible about 
saying--you know, and as a percentage of GDP, when you think 
about our discretionary spending, and we can have the mandatory 
conversation that the chairman raised. I am not sure, you know, 
we want to do that here.
    But that we do need to recognize in terms of the 
investments we need to make as a nation, and let us just look 
at the year in review. When Ebola happened, what were the 
expectations of the executive branch and the Federal 
Government? And with regard to the issue of when the children 
came, how do we take care of those children in an appropriate 
fashion in terms of the unaccompanied children?
    Measles right now. Right now, we read in the newspapers the 
issues of the superbug and the question of are we, you know, 
aggressive enough about that, and is the Federal Government 
aggressive enough on measles? You know, those are State 
responsibility.
    So my answer to the question is we believe that we have put 
forward what we believe are the right choices, and those 
choices extend across and beyond committee jurisdiction, and I 
know that. But those are the choices, and they are tough 
choices. They are--you know, and we know that some will be 
disagreed with, just as the critical access issue we just 
discussed or, you know, what I heard from Ranking Member Lowey 
is perhaps you did not put enough in the hospital.
    And so, we have throughout made choices. And in the 
discretionary, over $750,000,000 worth of cuts.

                            WELDON AMENDMENT

    Mr. Cole. Well, again, I do not disagree with that. But 
just for the record, this is not a policy. It is the law. It is 
a law that Congress passed. It is a law that the President 
signed.
    And again, absent a larger agreement, we will be living 
within the law, I suspect. So I think we are going to have to 
make those choices, and I look forward to working with you as 
we go forward.
    Let me quickly move to one other matter because I cannot 
enforce the 5-minute rule if I do not keep it myself. I know 
you are familiar with the Weldon amendment, which has been 
carried in the Labor, HHS bill since fiscal year 2005. The 
amendment prohibits Federal funding of--excuse me, prohibits 
funding to any Federal, State, or local government that 
discriminates against a health plan for refusing to cover 
abortion.
    The Obama administration has issued regulations designating 
the HHS Office of Civil Rights to enforce the Weldon amendment 
by receiving complaints and violations. I understand, I have 
been informed, perhaps misinformed, but informed that the State 
of California, recipient of funds under the bill, recently 
began requiring all health plans sold within California to 
provide coverage for abortion on demand through all 9 months of 
pregnancy.
    It is a clear violation of the Weldon amendment. However, 6 
months after the mandate was issued, your Office of Civil 
Rights has failed to take corrective action. The mandate went 
into place immediately in August of 2014. So real harm is 
actually occurring now.
    Complaints have been filed by several entities, including a 
number of evangelical churches that oppose abortion and are 
currently being compelled to fund it through their health 
insurance. So time is the essence. Could you tell us where we 
stand in this matter and when your Office of Civil Rights 
Compliance intends to act?
    Secretary Burwell. With regard to the implementation of the 
Weldon amendment, it is something that we take very seriously. 
And the complaints came in, and we opened the investigation 
with the Office of Civil Rights. We are moving to do that 
investigation expeditiously.
    With regard to my ability to say and tell the Office of 
Civil Rights when to finish the investigation, that is 
something we want to let the investigation run its course so we 
can use its results. And so, we are working expeditiously. The 
Office of Civil Rights knows this is an important issue, as you 
have said, and that time is of the essence with regard to----
    Mr. Cole. So the investigation is underway right now?
    Secretary Burwell. It is and--yes, sir. It is right now. We 
had--we heard from organizations, and when we heard from 
organizations with regard to the issues that you have raised, 
we opened an investigation.
    Mr. Cole. Well, thank you very much, Madam Secretary, and 
we will be following up with you on that to make sure that 
investigation does get carried through.
    With that, I am sorry I ran over a little bit, but I 
recognize my good friend from Connecticut, the ranking member.

                          AFFORDABLE CARE ACT

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    And just for the record, I might just note that since 2010, 
after adjusting for inflation, the Labor, HHS budget has lost 
almost $20,000,000,000. And with regard to the allocation 
affecting Labor, HHS, I have stated this many times in the past 
that I believe that it really is Labor, HHS has taken one of 
the biggest hits of any of the appropriation subcommittees, and 
we need to remedy that.
    Madam Secretary, Bureau of Labor Statistics released data 
that show that hospital prices are declining over the past 12 
months. The largest decline in prices comes in the Medicare 
program. Score one for single payer.
    Prices paid by private insurers grew by only 1.6 percent, 
which is substantially lower than the 6 to 7 percent annual 
increases that we used to accept as the cost of doing business. 
How much of the decline in healthcare cost is attributable to 
the Affordable Care Act? Can you talk about some of the 
Affordable Care Act's cost containment measures that have led 
to such a dramatic change in the healthcare cost curve?
    Secretary Burwell. So with regard to the Government pay 
part of this, the portion of it, there are or were changes that 
were part of the act that we moved to implement, and there are 
types of things that we will continue to work on. As we know 
when--in 2009, when CBO was predicting Medicare expenditures 
over the period, we know that we are $116,000,000,000 less than 
we have been, than we would have been on that trajectory. And 
those are changes, you know, attributable both to the market 
and to changes that were put in place.
    With regard to the market, you also mentioned the actual 
broader marketplace beyond Medicare, and one of the things that 
I think is happening is the issue of competition with regard to 
how that puts pressure on these issues. And we know that there 
were 25 percent more issuers that came into the marketplace and 
in terms of that price pressure that we see.
    I think we are starting to make progress, and we have seen 
some progress. We have seen through Medicare some of our 
efforts on patient safety. So we have seen a 17 percent 
reduction in patient harms through efforts that we have 
partnered with physicians on testing ways that you can reduce 
harms. Those are infections and falls in the hospital.
    And those kinds of things reduce and then not only lives do 
they save, but it is savings. And so, this is all part of the 
broader part of when we think about that issue of the 
Affordable Care quality, access, and affordability, we are 
forming our system so that we deliver better quality at a lower 
price has been a priority.
    We have made some progress. But in I believe that we can 
make more progress, and that is an announcement that we made 
recently. For the first time, we have set the goal that in 
Medicare by 2016, there will be 30 percent of all payments will 
be in an alternative payment form so that we can continue to 
build on those kinds of savings just as well as quality.
    Ms. DeLauro. Just a couple points. You know, I will just 
mention medical loss ratio, which has really worked to make 
sure insurance companies are spending 80 percent of their 
collections on the premiums, and that has resulted in billions 
of dollars in rebates to American families.
    Secretary Burwell. Two-point-eight.
    Ms. DeLauro. A value effort and shifting that cost in 
Medicare for value, as opposed to simply paying for volume of 
services.
    Just briefly, because I would love to get another question 
in, the department plans to make 50 percent of payments through 
alternative payment models by 2018. What is----
    Secretary Burwell. That is part of the delivery system. 
Reform will get to 30 percent by 2016 and then 50 percent. At 
that point, it will be--people will be doing the alternative 
payment models, paying for value, not volume.
    Ms. DeLauro. So we can conclude that if the ACA continues 
to constrain the growth of healthcare costs, will that not wipe 
out a significant portion of the projected future deficits?
    Secretary Burwell. We want to continue both through the 
implementation of delivery system reform and the proposals we 
have to reduce that spending in the entitlement space.
    Ms. DeLauro. Thank you.

                               HEAD START

    I would like to move to Head Start, and I will do this 
quickly. I just want to say this because I think it is 
important.
    1912, a teacher in a one-room schoolhouse in Texas made a 
decision that would ultimately affect the lives of over 30 
million American children. She allowed a 4-year-old boy to join 
her class, jump-starting his education by a year at a time when 
the concept of preschool learning was virtually nonexistent.
    That boy was Lyndon B. Johnson, and he would go on to be a 
teacher, President of the United States, and Head Start was 
established under his presidency 50 years ago this spring. 
Eight-week summer camp, robust year-round program, it serves a 
million children every year in the U.S. State and territories.
    So congratulations on 50th anniversary, but can you tell us 
briefly about the expansion of full day, full services for Head 
Start and Early Head Start and the gains you expect to see?
    Secretary Burwell. So, in this budget, I will just focus on 
three things. One is that expansion of full day, that expansion 
of full year, because we know that that is an important way to 
maintain the gains. And then the second thing is the quality 
implementation, and those have been conversations making sure 
that we have standards.
    Those two steps will help us improve quality, but also 
making sure that those Head Start providers in the program are 
meeting quality standards.
    Ms. DeLauro. Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    The gentleman from Idaho is recognized.
    Mr. Simpson. Thank you, Mr. Chairman, and congratulations 
on taking charge of the chairmanship of this committee and for 
your first hearing.
    Mr. Cole. Can I just say for the record, since you 
suggested me for this job, I am glad you were brave enough to 
then join us on the committee. [Laughter.]
    Mr. Simpson. I felt if I recommended you for the job that I 
should be willing to suffer with you. No----
    Secretary Burwell. Wait----
    Mr. Simpson [continuing]. I do not mean that. This is a 
very important committee. Ralph Regula used to call it ``the 
people's committee'' because it affects so many people, and 
programs in it are very important.
    But congratulations to you, and welcome to your first 
hearing before this most friendly subcommittee. You know, I 
read your testimony last night, and I actually agree with an 
awful lot of what is said in there and a lot of the programs 
that you have emphasized and put the resources into.
    The problem is, as the chairman has said, it is dollars and 
how many dollars we are going to have to spend and stuff. And I 
agree with my colleagues here who have suggested that 
sequestration and you have suggested that sequestration is 
going to be devastating. It really is going to be devastating, 
and I wish the President had not proposed it as the hammer on 
the super committee that was ultimately adopted.
    It was never going to happen. It was passed, and it was so 
ugly that we were never going to do it. But yet here we are. 
The problem is the President proposes doing away with 
sequestration and blowing the numbers off in his budget and 
doing it with tax increases and fee increases and everything, 
and very little, if anything, on the mandatory side of the 
program, which is driving our budget deficit.
    And right now, while we applaud ourselves and pat ourselves 
on the back about the fact that the budget deficit is down by 
two-thirds essentially from the high, it is still 
$500,000,000,000. And if you look at the $18,000,000,000,000 in 
debt and the interest paid on that at historical interest 
rates, the interest we pay on the national debt would outspend 
defense spending, Labor-H spending, and much of the rest of the 
discretionary spending.
    So it is still important we focus on the fact that we are 
in debt and that we have got to address that. And that is what 
sequestration is about. Not the best way to do it, and I hope 
to come up with a budget deal to ultimately deal with it.

                               ORAL CARE

    But having said that, a couple of dental questions. You 
might guess the dental questions would come from the dentist on 
the committee. The CDC has said that one of the top 10 public 
health achievements of the 20th century is water fluoridation. 
This marks the 70th anniversary of the community water 
fluoridation programs.
    What plans does HHS have to acknowledge this 70-year 
milestone and educate communities about the preventive health 
benefits of community water fluoridation, and when will HHS be 
finalizing its recommendation to set the level for optimally 
fluoridated water at .7 parts per million?
    Dentistry supported the proposed change, but it has been 
waiting for 4 years to see the final recommendation.
    Secretary Burwell. This is an issue that I think--the issue 
of the recommendation and where we go with regard to the number 
is something that I expect in the relatively near future that 
we will come out with. A question of the anniversary, I will 
admit, is one that I will go back to CDC, and I am just very 
happy that we now have a Surgeon General who is a part of a 
great voice for us in a nation to do this type of thing and 
make sure the Nation knows.
    He has been terrific on measles, been helpful on flu, 
having that voice with the American people as a physician. And 
so, now I need to add this fluoride anniversary to the list of 
things to find out.

                              MARKETPLACE

    Mr. Simpson. Good. Currently, the Federal marketplace--in 
the Federal marketplace, consumers must purchase a medical plan 
before purchasing any dental plan. This requirement prohibits 
adults from purchasing dental plans, including Medicare-
eligible seniors, and also creates a challenging purchasing 
experience for consumers who want one-stop shopping.
    Will HHS consider allowing direct purchase of dental plans 
so that consumers are able to purchase dental benefits within 
the marketplace if they desire?
    Secretary Burwell. That is one in terms of considering the 
standalone purchase is the question I think that you are 
asking. And that is something I am happy to go back and look 
into in terms of what is--whether it is--what is the limitation 
currently in terms of why it does not happen.
    Mr. Simpson. I think it would take, from everyone I have 
talked to, is a technical change that could happen within HHS. 
It would not take a statute or anything for Congress to do. But 
I think that it could be--could be done by your department.
    As you know, HHS has mandated the replacement of the ICD-9 
CM codes that are currently used by medical coders and billers 
to report diagnosis and procedures with the new ICD-10 code, 
effective October 1, 2015. This will be a significant change in 
the way coding is done, and I have heard from physicians in 
Idaho and, frankly, across the country that have small 
practices that the cost and overall impact that it will have on 
them could actually lead to them shutting down their doors.
    Given that Congress has already delayed implementation, I 
wonder what your thoughts are on either delaying or allowing a 
phase-in period after the October 1st deadline?
    Secretary Burwell. So with regard to we have delayed, as 
you reflected, and believe that we would be ready by the 
October 15th deadline--October 2015 deadline this year. And we 
have done testing, and we are doing testing. And so, if there 
are providers that have concerns, if you can help us understand 
because we want to continue to do that testing in terms of 
making sure that people are ready.
    The value and the benefit, when we get to more simplified 
coding, which I think is something that is beneficial across 
the system to some of the costs that we were talking about, 
that is why we want to go ahead and move forward with it. But 
we are trying to do it in a way that we make sure we listen and 
understand, which is a part of why we are doing the testing.
    If there are specific examples that you are hearing about, 
we would like to know about them and hear so that we can work 
with folks about that.
    Mr. Simpson. I look forward to working with you on it. 
Thank you.
    Mr. Cole. Thank you.
    I will recognize the gentlelady from California, my good 
friend Ms. Roybal-Allard.
    Ms. Roybal-Allard. Thank you, Mr. Chairman.
    Mr. Cole. And can I say I was at the CDC recently and saw 
the building named after your father. So it was pretty 
remarkable.
    Ms. Roybal-Allard. Okay, thank you.
    Mr. Cole. Thank you.

                   HEALTH PROFESSION TRAINING PROGRAM

    Ms. Roybal-Allard. Madam Secretary, in today's increasingly 
diverse population, HRSA's Title VII health professions 
training programs have really been an invaluable tool in 
creating a pipeline of minority primary care professionals who 
overwhelmingly return to practice in diverse and underserved 
areas.
    So I truly wanted to commend the administration for its 
support of the minority Centers of Excellence and Nursing 
Workforce Diversity Programs and for allocating the $14,000,000 
for a new program to build on that experience gained from the 
Health Careers Opportunity Program.
    However, I am disappointed with your proposal to eliminate 
the Area Health Education Centers Program, which has 
successfully recruited students and provided training 
opportunities for residents and practitioners both in rural and 
urban underserved areas. This program, as you know, has been 
repeatedly cited by HRSA as exceeding the agency's goals and 
objectives.
    Therefore, if you could explain why the AHEC program was 
not funded, despite its long successful history, and what 
funding sources are you referencing in your budget 
justification as being able to support ongoing AHEC activities? 
And I will give you the other two questions. I have related 
questions so you can answer all at once.
    Also, how will the new Workforce Diversity Program differ 
from the old HCOP program, and will the new program continue to 
target minority and disadvantaged high school and college 
students? And how will you ensure that its results and similar 
increases in the numbers of minority health professions?
    Secretary Burwell. So with regard to the first issue in the 
program, I think one of the things that we are trying to do is 
make sure that in this important time, as you reflected, that 
we do get diverse workforce into the communities. And that is 
about the training and then getting them there into the 
communities.
    And I think one of the most important anchors of making 
that concept, which we agree upon, become a reality is actually 
the National Health Service Corps. Because when we look at 
those numbers and you see that expansion that we are proposing 
in our budget, 30 percent of all of the National Health Service 
Corps are actually minorities, and I am sure many of you, 
because there are a number of physicians present and folks who 
focus on this issue, only 10 percent of the population. So we 
overrepresent, and by working and adding there, we believe that 
is an important step.
    With regard to that specific program, what we believe is 
that there are--it has been an important program, but one of 
the things, as we set up the program, we asked the grantees and 
others to have sustainability plans so that this would be a 
program you got up and running.
    With regard to the second issue, the issue of the HCOP and 
that question of who will be trained. One of the things that we 
are trying to do is make sure that we are getting those 
individuals who are both interested in clinical practice as 
well as research. We are doing this in the piece you are 
talking about, but also as we look at NIH.
    There are individuals who have expressed that interest, so 
we are focusing on the people at that level who have expressed 
that interest, want to be scientists, want to be doctors and 
physicians, but we lose along the way. And so, we are putting 
our emphasis in our budget on those individuals that we know 
are in. So we do not lose those people who are already there 
versus focusing on some of the very early years they are in the 
program.
    So it means there is overlap, but some of the earliest 
years, I think we believe that if we can get more people who 
are interested in starting to do the training in this space to 
stay in, that we get our numbers up and more people into the 
communities more quickly, number one. And we create the role 
models that help create pull later on.
    So it is overall in terms of that is how we are trying to 
think about the spending of the dollars in the priority area 
that we are focused on.
    Ms. Roybal-Allard. Okay. So just so that I understand. So, 
but you still need that pipeline? In other words, I understand 
what the endgame is, but how do you--what is in the program 
that will continue to feed that pipeline so that you will have 
those----
    Secretary Burwell. I think right now what we are focusing 
on is the point at which there are people in the pipeline in 
terms of how we are putting emphasis with our dollars.
    Ms. Roybal-Allard. I guess what my question is that is fine 
in the short term, for the next year, maybe 2 years. But as we 
go down, you know, to 5, 10 years from now, how is that 
pipeline going to be fed?
    Secretary Burwell. You know, I think the question in 
elementary school and children's exposure in terms of diverse 
children and other children in terms of STEM issues across the 
board, in terms of the place where I think we believe that 
there are issues that we see happening with regard to 
minorities is at that level when they become engaged and may 
not have the support that they need to stay engaged in that 
way.
    And that is where we are going to emphasize in terms of 
what the budget does at this point.
    Ms. Roybal-Allard. I see my time has expired.
    Mr. Cole. Okay. The gentleman from Arkansas, my good friend 
is recognized.

                                 OPIOID

    Mr. Womack. Thank you, Mr. Chairman. And I, too, want to 
join the chorus of people congratulating you on your 
chairmanship and the skill at which you execute your duties as 
chairman of this very important subcommittee.
    And I want to welcome my friend the Secretary here today. I 
would expect that her background over at Budget is probably an 
invaluable asset when considering the matters that we are 
talking about here today.
    The overall chairmen, to no surprise, talked a little bit 
about the problems combating drug addiction. And Madam 
Secretary, you are well aware of the State that I represent, 
part of the State that I represent, and the fact that drug 
addiction, particularly prescription drug abuse, is a major 
issue facing our country. And I am glad that we are recognizing 
that it is of such major proportions that we have to put a 
higher priority on it.
    As a matter of fact, in the couple of hours that we are 
going to be in this room today, on average, 10 people are going 
to die as a result of some kind of a drug overdose. Nearly 
7,000 a day are going to be treated in ERs around the country.
    There is no question when I talk to my job creators back in 
my district, they talk to me about the fact that they have jobs 
available, but they have very difficult times finding people 
who can do something as simple as pass a drug screen for an 
employment opportunity. So, I mean, without belaboring the 
point, we do not need to have a debate about that. That debate 
has taken place.
    Last September, nearly 50 of my colleagues and I sent a 
letter to you and the Administrator of SAMHSA calling for a 
modernization of our Government's response to this crisis. We 
did not receive a response initially, and I am glad in your 
testimony you talk about responding to Members of Congress is a 
high priority of yours.
    But our CRomnibus included report language asking SAMHSA to 
update all of its professional education and training programs 
for opioid treatments and office-based treatment programs. Do 
you know at this stage of the game what steps have been taken 
to fulfill this congressional request in the CRomnibus?
    Secretary Burwell. I will have to look and see in terms of 
where we are exactly, but it is a major part of the three-part 
strategy that we are pursuing in terms of this issue of 
opioids, heroin, and overdose.
    In terms of the first part being about prescribing in terms 
of the place where we need to focus, as Chairman Rogers 
mentioned, in terms of the State-by-State plans, this is an 
important part of giving that instruction on prescribing. And 
so, we are moving forward on it. Exactly where we are in the 
process related to the exact language of the CRomnibus, I want 
to get back to you.
    But it is a very important part of the three-part strategy 
that we are pursuing in this space, which is first the issue of 
prescribing; second, the issue, as you mentioned, of things 
like naloxone and how we have access to those; and then, third, 
the treatment issue are the three places that we are working.
    Mr. Womack. Do we have any other real barriers to our 
ability as a nation to elevate the discussion to recognize its 
significance from loss of life to productivity? I cannot--I 
cannot underemphasize--or overemphasize the impact that it is 
having. And are there other barriers that this panel, that this 
Congress needs to know about?
    Secretary Burwell. So some of the things we have mentioned 
in terms of the budget, and I think the chairman spoke to in 
terms of the funding issues, and I think those are articulated. 
I think the other thing, and I just spent time with the 
Governors this weekend when they were in town on this issue 
specifically. Because one of the things that we have to do is 
we have to have tracking mechanisms with regard to the 
prescribing.
    We can teach people about the prescribing, but one of the 
things that is happening, and to add to your statistics, in 
2012 to 2013, there were 259 million prescriptions for opioids. 
And I think you all know the population of the United States so 
you understand what that means in terms of--so getting that 
prescribing, tracking that prescribing and the filling of those 
prescriptions.
    That is a place that we have seen progress in places like 
Florida and some other States that are taking action, and that 
is a place we are going to need to work with the States and 
making sure there is interoperability with the States, when the 
chairman mentioned the Office of National Coordinator of 
electronic medical records. So those are some of the critical 
path issues.
    We need people to know about the prescribing. We need them 
to abide by that. And then we need to do the quality tracking, 
and we need to be willing to take the steps in terms of payers 
and others when people are not abiding by.
    And we need partnerships with the private sector. CVS 
tracks within their own system, but you can go to Wal-Mart, 
Walgreens, or others. And so, those are some of the critical 
things we need to do.
    Mr. Womack. Well, even in our own State, there has been a 
major discussion, and I am sure this is happening in every 
State. But particularly in Arkansas, the fact that it is a 
small State with a limited budget, and now we have got so much 
of this phenomenon happening, it is crowding our prisons. We 
are putting people behind bars at an extremely high cost while 
other violent-type criminals are competing for that type of bed 
space.
    And so, somehow, some way, our Nation has to wrap its arms 
around this increasing phenomenon that is directly affecting 
our economy.
    I see my time is out, and I will come back later in the 
next round.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    My friend the gentleman from Tennessee is recognized.
    Mr. Fleischmann. Thank you, Mr. Chairman, and I want to 
join in the praise and thankfulness for you taking chairmanship 
of this most important subcommittee.
    This is my third term in Congress, my second term on this 
most important subcommittee, and I appreciate serving with you 
and your chairmanship, sir.
    Madam Secretary, good morning.
    Secretary Burwell. Good morning.

                          AFFORDABLE CARE ACT

    Mr. Fleischmann. I want to thank you as well for stepping 
up. This is an arduous task that you have to chair HHS, and I 
also want to thank you for your phone call yesterday and for 
your civility. And we all have a very difficult role in 
governing this great nation, and I want to thank you for being 
here today.
    I am going to ask some questions about Obamacare and then 
RAC audits. But in candidness, I believe Obamacare is 
inherently flawed. I thought it was flawed from the beginning. 
I was not in Congress when it was passed. It has had a lot of 
frailties, and I come to the debate after having seen this now 
in my third term in Congress just so frustrated with this 
issue.
    So I want to let you know that on the onset as I ask you 
these questions. And I know you have inherited this role, and I 
thank you for stepping up and taking that.
    Last March, your predecessor was before us in this 
committee, and I asked her questions. And she testified before 
this panel that the administration would not delay the 
individual mandate or any of its penalties. Yet less than 2 
weeks later, the enrollment deadline was extended.
    Last week, HHS announced that it had sent 800,000 people 
incorrect tax forms. We learned yesterday that has led to 
approximately 50,000 inaccurate tax returns filed by Americans 
on which the Treasury Department has announced it will not act. 
Separately, HHS announced that you would open a special 
enrollment period in order for people to avoid paying penalties 
for missing all the previous deadlines.
    Madam Secretary, my first question, and it is a two-part 
question, is what authority does the administration have to set 
its own policy each time Obamacare is implemented incorrectly? 
And as a follow-up to that, I would specifically like to know 
what authority you believe your department has to declare a new 
enrollment period and set arbitrary deadlines?
    Secretary Burwell. With regard to the issue of--I will 
address the special and the most recent special enrollment 
period. Special enrollment periods occur for people when they 
have life-changing events, and they are able to enter in the 
system. You know, we have a marketplace-based system, and the 
marketplace is based on private insurance.
    And so, insurers actually have periods when you have a life 
change, when something happens that is unique, that you can 
come in not during their set period. And so, that is with 
regard to the issue of special enrollment periods, that is what 
we have done.
    With the one that you are referring to specifically, for 
those individuals who did not recognize that there would be a 
fee, that they did not understand, that they did not this first 
time through, what we have said is for those individuals that 
there will be a special enrollment period for that limited 
group of people. And that is what this particular one that you 
just referenced that we just did is about.

                       RECOVERY AUDIT CONTRACTORS

    Mr. Fleischmann. Okay. Thank you.
    Madam Secretary, I would like to ask you some questions 
about your plans regarding recovery audit contractors, the RAC 
audits.
    Secretary Burwell. Yes.
    Mr. Fleischmann. These have wreaked havoc on Medicare 
reimbursement processes. I understand you are considering 
establishing a fee-for-claims appeals to raise revenue and 
discourage appeals in light of the huge backlog which remains.
    I cannot see that as anything more than encouraging my 
constituents to succumb to a broken RAC system. What plans do 
you have to address the underlying problem of the number of 
audits resulting in the denial of claims that should have 
actually been paid?
    Secretary Burwell. So with regard to this issue, when I 
came in, it is an issue, and there is a large backlog. So put 
together an approach to working through that backlog as quickly 
as possible and are very appreciative that there is bipartisan, 
bicameral engagement in the issue with us because I think it is 
going to take us working together to get through.
    Three things we need to do to get those numbers down. The 
first thing that we need to do is where there are 
administrative things that we can do at CMS in terms of making 
that go more quickly or, where appropriate, settling through 
with providers, that we do that.
    The second thing is we have asked for the funding to help 
us get more specialists. This happens through the Office of 
Medicare Appeals and Hearings--Hearings and Appeals. And so, 
this is a body that is part of HHS, but they are specialized 
appeal judges that have to hear these, and so we need the help 
to work through the backlog. That is item two in terms of 
getting rid of this backlog.
    Number three is we actually are asking for legislative 
changes from you all to try and make sure that we discourage. A 
couple things about the fee. One, never on a beneficiary. 
Number two, if you win your appeal, the fee comes back.
    Because what we are seeing is in this appeal process 
because it is easy and it is simple, part of the reason we have 
it skyrocket is there is not a cost. If I think I might 
possibly be able to get the money, I am going to appeal because 
there is the time issue, but what do I--you know, in terms of 
that.
    And so, that is why we believe it is something that could 
help us with the overall issue.
    Mr. Fleischmann. Thank you very much, Madam Chairman. And I 
yield back.
    Mr. Cole. I thank the gentleman.
    And I now recognize, move on to the gentleman from 
Maryland, probably the one real expert we have on this 
committee that knows something about what he is talking about. 
So, Dr. Harris.

                                MEDICARE

    Mr. Harris. Thank you, Mr. Chairman, I think.
    Thank you, Madam Secretary, for coming before the 
committee, and welcome.
    First, a couple questions that are just very short because 
my time is limited. With reference to the Independent Payment 
Advisory Board, or IPAB, you know, the budget document says 
that this is one of the mechanisms that is going to reduce 
long-term drivers of Medicare cost. Do you intend to appoint 
members to that board this year?
    Secretary Burwell. If the Congress makes recommendations, 
we would welcome those.
    Mr. Harris. You do not need--you do not need congressional 
recommendations. Do you intend--the law, the ACA very 
specifically says you have the authority to appoint the board. 
Do you intend to appoint a board?
    Secretary Burwell. It says ``in consultation with the 
Congress,'' and that is the part we would like to have.
    Mr. Harris. Just a follow-up to Mr. Simpson's question on 
ICD-10. Since the CMS Web site says that you can run ICD-9 and 
ICD-10 parallel, pretty clearly says it can be done, would you 
consider creating a hardship exemption for ICD-10 for 
physicians whose practices just cannot afford to convert to 
ICD-10?
    Secretary Burwell. I would want to understand how that 
would actually work in terms of those physicians, if that is 
something that, you know, happy to understand and take a look 
at that question. I think we believe everyone should switch and 
that people are ready.
    Mr. Harris. Well, I fully understand how the Government 
thinks everybody should switch to the regulatory scheme 
proposed by the Government. I am telling you this is one of the 
largest concerns of small physician groups, the ones we want to 
help, the small rural physicians who cannot afford to convert 
to ICD-10.
    The CMS Web site clearly says they can be parallel. I would 
hope you would be opening to creating a hardship exemption.
    Maryland's health exchange was a disaster. They are now in 
court. They are going to try to recover money from contractors. 
I just want to ask you, Madam Secretary, if Maryland recovers 
money from contractors, are you going to seek the return of 
that money to HHS?
    Secretary Burwell. With regard to the issue of how these 
contracts were done, it is a matter of when the contracts that 
we had with the States in terms of the agreements we had with 
the States. Depending on why the money comes back and what was 
done wrong is the answer to that.
    Where we have the ability to in terms of our relationship, 
sometimes those actually have to do with the contract with the 
State, not with their relationship in terms of fulfilling their 
commitments to the Federal Government. Where there are cases 
where that can happen, that is something we would like to 
understand.
    Mr. Harris. Thanks.
    Secretary Burwell. And our IG is working on it.
    Mr. Harris. The overall budget increase proposed was an 
increase of 6 percent to HHS, that is right? Round numbers.
    Secretary Burwell. Yes.

                               NIH BUDGET

    Mr. Harris. Why is NIH only 3 percent? I mean, you know, if 
the administration always talks about the importance of 
research and all, why actually would you disproportionately not 
raise the primary driver of basic medical research in the 
country?
    I mean, why would you choose to expand other parts of HHS 
and not--or not to expand NIH at the same extent?
    Secretary Burwell. So with regard to the increases across 
the department, we believe that a $1,000,000,000 increase for 
NIH is a healthy increase. And NIH, in terms of what it has 
seen over the period of time, has been different in different 
areas.
    Some of the increases that are larger, we just actually 
spoke about one of the ones with your colleague in terms of 
some of our program integrity efforts have larger increases in 
percentage terms than, say, NIH does. Another area is we are 
working very hard to implement the Congress, the legislation 
that you all gave us with regard to FSMA and food health 
safety, and so there are increases that are larger in other 
parts of the department.
    Mr. Harris. So a decision was made to not prioritize NIH 
for their share of the 6 percent increase. I mean, again, I 
mean, the numbers are the numbers. The administration says we 
need 6 percent more for HHS, but you only need 3 percent more 
for NIH.
    Secretary Burwell. With regard to how we put a budget 
together, I think area by area and operating division by 
operating division. We ask, determine the needs, and then we 
have to make choices and tradeoffs in terms of how we do that.
    In terms of taking a percentage and giving everybody a 
percentage increase, that is actually not how we put our budget 
together. What we did was work through, as I said, whether it 
is particular needs that we have in program integrity or the 
implementation of laws that we have, there are places where we 
need larger increases.
    Mr. Harris. I fully understand the prioritization. I am a 
little disappointed that the administration, and let us face 
it, this is kind of a make-believe budget because it does not 
accept the budget caps that are in current law. So at least in 
your make-believe budget, I would have hoped that you would 
give the NIH the average increase in HHS.
    With regard to the Strategic National Stockpile, can you 
assure the committee that your fiscal year 2016 budget request 
for the SNS will be sufficient for procurement of both newer 
medical countermeasures and for the replenishment of the 
existing stockpiled medical countermeasures?
    Secretary Burwell. We have proposed the budget that we 
believe will meet those needs, as well as what we believe we 
can adequately spend in terms of making sure we are managing 
the taxpayers' money well.
    Mr. Harris. And will that be enough to procure the 75 
million dose of anthrax vaccine that would be needed?
    Secretary Burwell. With regard to the specific of that 
particular procurement, that is something I want to get back to 
you on.
    Mr. Harris. And I would appreciate that. Thank you.
    Mr. Chairman, I yield back.
    Mr. Cole. Just following in order, I am going to skip down 
actually to Mr.--yes, Mr. Rigell, who was here at the beginning 
of the hearing, and then we will come back.

                            MEDICARE APPEALS

    Mr. Rigell. Thank you, Mr. Chairman.
    And Secretary Burwell, thank you for being here today. It 
is a pleasure.
    I want to call your attention to page 16 of your testimony, 
which I read carefully, and let me just highlight in here. 
``Between fiscal year 2009 and 2014, the number of appeals 
received by the Office of Medicare Hearings and Appeals has 
increased by more than 1,300 percent.'' And I read carefully 
where you are going with your response.
    And I say this in a constructive way, but it seemed to me 
like a circular loop. The first action was to take 
administrative action. And the second part was to request new 
resources, and then third was to implement new strategy. So the 
strategy is to implement a new strategy.
    And I am going to give you just a moment to respond, but 
then the third part says propose legislative reforms that 
provide additional funding. So it was taking administrative 
actions, finding new resources, which are funding, and then to 
implement a new strategy. The strategy was to implement a new 
strategy. And then the third one was additional funding.
    So I felt like I ended up right where I started, and there 
was no explanation at all that I saw, perhaps I missed it, as 
to what was causing it, nor was there a satisfactory answer as 
to what you will be doing about it.
    Secretary Burwell. So with regard--I apologize if I used 
the word ``strategy.'' Policies and the policies that your 
colleague referred to are some of the types of policies that we 
believe are important. We think in terms of what is happening 
is that, first of all, we have a backlog, and part of what we 
need to do is work through the existing backlog.
    And in terms of administrative actions and whether that is 
settlements or additional funding to work through that backlog, 
it is very important. As we think through the question of how 
to deter those kinds of numbers in the future, what we do think 
is it is important to put in place certain types of deterrents, 
and also I think we believe that there are places where the 
amounts and what people are appealing should be changed.
    Mr. Rigell. Okay. I guess you are somewhat answering the 
question on what is driving this, the causal factors that led--
I mean, it was a stunning increase in the number of appeals, 
and I am sure many of them need to be paid, and then some of 
them are probably fraudulent, of course.
    But help us to understand has the department--has the 
agency, have you been able to understand why the sharp 
increase?
    Secretary Burwell. I think we think that some of the reason 
that there has been a sharp increase is because there actually 
has been the development of a number of people who see this as 
an opportunity and an economic opportunity to help providers 
appeal. And so, one of the things, and that is why we want to 
do some of these policy changes, is to put in place deterrents 
to that.
    Mr. Rigell. Deterrents from the third parties being able to 
engage in that or deterrents----
    Secretary Burwell. Frivolous appeal.
    Mr. Rigell. There you go. Well, we are in complete 
agreement on that.
    Secretary Burwell. Frivolous appeal. Frivolous appeal is 
all we are trying to get at, which is why in the proposal we 
have, if you win, you do not pay. So what we are trying to do 
is get to a place where--you know, appeals are important. We 
understand that.
    Do we get it right 100 percent of the time? When you look 
at the numbers, actually they are quite--the appeals are 
actually small. Relative to the number of transactions in 
Medicare, it is still relatively small. But what we want to get 
at are the frivolous appeals.

                           MANDATORY SPENDING

    Mr. Rigell. Okay. I am just going to make a comment here at 
the end, and that is just as it relates to what Chairman Rogers 
said, and I was very encouraged to hear him say this. This, he 
was speaking about the failure really of us as a nation, all 
branches--although I am proud of what we have done as House 
Republicans on this matter--but the failure to address 
mandatory spending.
    There is going to be compression on the rest of the budget, 
discretionary part, into perpetuity because of the sharp 
increase in the number of seniors over the next 10 years. And I 
really have not seen anything from the administration on this, 
and I considered it a real special opportunity, if you will, to 
meet with the President just briefly on this.
    And he said, ``Scott, what is on your mind?'' I said, ``Mr. 
President,'' I said, ``I am just deeply concerned about we have 
not as a nation, and I have not seen from the administration 
enough leadership on this topic.''
    Because the math, it needs to be faced by the American 
people and all of us that we have got to come up with 
meaningful reforms on mandatory spending. So I would implore 
you and your colleagues to lead in this. It is something that 
has got to be done for us to have a bright future for our 
children and grandchildren and all of us, actually.
    Secretary Burwell. I think it is an issue of importance, 
and we look forward to hearing the response to our 
$450,000,000,000 worth of cuts that are represented in the HHS 
budget specifically on the mandatory side. And while one can 
say we should do more, I think I hear that is your point, I 
guess I would say----
    Mr. Rigell. Mathematically, the math leads me to this 
conclusion. That is why I bring it up.
    Secretary Burwell. And I think we have $450,000,000,000 
worth of changes on the table as part of our overarching 
budget, and the question is, is we have an approach to work on 
those issues. And I think we look forward to hearing how people 
think about those.
    Mr. Rigell. Well, I appreciate the spirit in which that is 
offered, and I will learn more about it. It is just my 
experience has been to this point that the administration has 
just not really led in this area. And just as a fellow 
American, I am just asking that that take place.
    But I appreciate your testimony today and your service at 
the agency. Thank you.
    Secretary Burwell. Thank you. Thank you.
    Mr. Rigell. I yield back.
    Mr. Cole. Just for the gentleman's information, Mr. Delaney 
and I will be dropping a bill next week that actually deals 
with the entitlement issue and Social Security. You might have 
a look at it, and we would welcome your input.
    Mr. Rigell. And thank you for your leadership on this. It 
needs to be done. Thank you.
    Mr. Cole. Absolutely. I yield now to my good friend, the 
gentlelady from Alabama.

                              MARKETPLACE

    Mrs. Roby. Thank you, Mr. Chairman.
    Madam Secretary, thank you for being here today.
    If you will just bear with me a minute, I will get to the 
question. But the IRS requires the HHS-managed marketplace and 
State-operated exchanges to report account level information, 
including the identity of all individuals who obtained coverage 
and the amount of assistance received by that person. We are 
all aware about the administration's failed healthcare.gov Web 
site launch. However, I am not sure that most Americans are 
aware of the fact that the critical backend data reporting and 
payment systems used by issuers in CMS were not operating 
effectively as of last spring.
    HHS's inability to provide timely and complete transmission 
of the required reconciliation data to the IRS seems to 
indicate that the critical backend systems continue to function 
at less than optimal levels and are still not fully 
operational. So we understand that HHS's first transmission of 
this required data was not provided to the IRS until October of 
2014. In addition, we understand that the data that has been 
provided on a monthly basis has not been shared in full and in 
a routine manner.
    Our understanding is that as of January 20th of 2014, the 
start of the tax filing season, HHS provided the IRS with the 
following partial data from the 36 States participating in the 
Federal facilitated marketplace, and this data only covers 2.8 
million of the 4.2 million policies purchased through the 
Federal facilitated marketplace, limited data from HHS-managed, 
State-based exchanges for the 9 of the 15 State-based 
exchanges.
    So given the fact that over 86 percent of the individuals 
participating in the marketplace or an exchange are eligible 
for advance premium tax credit, how can the IRS and HHS ensure 
that taxpayers are not subject to overpayment, underpayment, or 
fraud in light of the lack of accurate data for individuals who 
purchased insurance through the marketplace or exchange?
    Secretary Burwell. The data for the 1095s with regard to 
that issue have been provided to the IRS in terms of that is 
what is happening as part of this tax season. So the question 
and the number that you have with regard to the number of 
people and the data that the IRS received is not a number I 
have.
    Love to take it back, love to understand where it came 
from. Because in terms of the IRS receiving the information as 
part of this tax season, they have. And so, I am not sure where 
that number is coming from, and maybe if you can help me----
    Mrs. Roby. Well, if you can correct that for me, it would 
be really helpful----
    Secretary Burwell. Sure. Sure.
    Mrs. Roby [continuing]. Because that is the information 
that we have----
    Secretary Burwell. I would love to follow up and understand 
where that came from because the IRS has the tax information. 
And certainly, we are responsible for the Federal marketplace. 
With regard to the State data, you know, that is a State 
responsibility.
    Mrs. Roby. Sure.
    Secretary Burwell. But those numbers were not at all what I 
would have--you know, what I have reviewed in terms of the 
State numbers. So if we can understand that, love to follow up.
    Mrs. Roby. Okay. That would be appreciated. I think, well, 
in light of the fact that you have differing numbers than I do, 
I guess the follow-up question would be these backend systems, 
I mean, are they fully operational? I mean, is that the 
position that you are taking?
    Secretary Burwell. So there are two different issues when 
we talk about I think that reference the backend systems. 
Because at one point, you referenced the insurers and the 
question of their relationship, you know, this is about the 
individuals in terms of the IRS. Because I thought when you 
started and you mentioned the insurers.
    The question of the backend system with regard to the 
insurers, everything is automated. Do we believe it should be 
done in a way that is more technologically easier? Yes. And we 
are going to continue to work to do that, and we are going to 
work every day to make that.
    But the automated system that we are currently using is a 
system that we use for Medicare Advantage and Medicare Part D, 
and so the system that we are currently using is a system we 
have used in other ways for other things. Do we believe this 
can be made easier? Yes. Let me be clear about that, and we 
want to work towards that.
    Mrs. Roby. As it relates to consumer data hacking or 
unauthorized activity, can you talk about do you all have a 
number of events that have occurred, and can you give the scope 
of the events and then what you are doing to protect consumers 
on this?
    Secretary Burwell. With regard to personally identifiable 
information, we at this point have not had a malicious breach 
of the marketplace with regard to that data.
    Mrs. Roby. Okay. All right.
    Secretary Burwell. You know, it is an important issue, as 
we have seen with private sector companies. It is something we 
stay on top of. We have come in and put in place a strategic 
approach that actually is about the how you set up the systems, 
the prevention, and the constant monitoring to make sure that 
we are staying on top.
    I guess I just want to emphasize it is a very important 
issue. We have not had a breach, but it is something we want to 
make sure that we continue to focus on. It is also a part of 
the funding. So an important thing.
    Mrs. Roby. Okay. My time has expired. But if you would 
please follow up on the first question, and I will make sure 
and give you----
    Secretary Burwell. Be happy to.
    Mrs. Roby. [continuing]. Where we received information.
    Secretary Burwell. That would be helpful. That would be 
helpful. Thank you.
    Mrs. Roby. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you. We have two gentlemen from 
Pennsylvania who have yet had an opportunity to ask questions, 
but in the interest of partisan balance, I want to----
    Ms. Roybal-Allard. I thought you had forgotten me. 
[Laughter.]
    Mr. Cole. Well, no, we are just moving down, giving 
everybody an opportunity. But my friend Mr. Fattah is 
recognized for 5 minutes.
    Mr. Fattah. Thank you, Mr. Chairman.
    And in great congressional fashion, I am going to say a 
group of things, and then I am going to ask a question. All 
right?
    First of all, I want to thank you for your extraordinary 
leadership at the department in a great many things in 
particular, but first and foremost, your visit to Philadelphia 
on Dr. King's birthday and at the Project HOME with Sister Mary 
Scullion. And it was great to have you.
    The work that you have done on the Affordable Care Act, 
Pennsylvania has been extraordinarily benefited by the 
enrollment process. We have hundreds of thousands of people who 
now have coverage that in the latest enrollment process, with 
over 11.4 million people signed up. So I want to congratulate 
you on that.
    I want to mention that the work that the department is 
doing as part of the BRAIN Initiative that I have been so 
involved with. Francis Collins and NIH, but across the board, 
the administration has done just some very important work. We 
have some 15 million Americans suffering from one of the 600-
plus brain diseases or disorders, and we have a lot of progress 
that we could make in this regard.
    Obviously, it is a tremendous cost, but beyond the cost of, 
you know, things like Alzheimer's, it is really the families 
involved. I mean, just so I want to thank you for that.
    And then I want to ask my question, which is about our new 
Governor in Pennsylvania, Governor Wolf, who wants to proceed 
now in terms of Medicaid expansion as part of the Affordable 
Care Act. And our previous Governor had wanted to do--had a 
proposal that had been--the department and the State had been 
jostling back and forth for about, and there was some 
agreement.
    And I want to know how we can now transition and how you 
see the transition to full Medicaid expansion?
    Secretary Burwell. The Governor can come, and it actually 
can happen really, I think, two different ways. It depends on 
how the Governor does or does not want to implement the 
existing agreement, and he has that opportunity to do that.
    If he wants to do anything different in terms of the 
agreement, we welcome that conversation and look forward to it.
    Mr. Fattah. Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    The long-suffering other gentleman from Pennsylvania, Mr. 
Dent.

                                 OPIOID

    Mr. Dent. Thank you, Mr. Chairman. I am not suffering, but 
thank you just the same. And congratulations on your 
chairmanship.
    Secretary, great to be with you this morning. I want to 
follow up on some questions I think that Mr. Womack just 
discussed. And I came in during the middle of it so I may be a 
little redundant. I hope I am not.
    But my home State's legislature, like yours, has taken up 
action to expand access to naloxone, or Narcan. I know you had 
gotten into that. In fact, I am holding a hearing in my own 
district on this very important subject in rural Berks County, 
Kutztown, to discuss this. We have had numerous deaths of 
overdose from heroin.
    How would you, I guess, describe the HHS budget proposal, 
how would it help States like mine, and how the department 
plans to reduce overdose deaths through ensuring broader access 
to naloxone?
    Secretary Burwell. So I think it is both about the access 
to naloxone, but one of the other parts of the budget is the 
importance of supporting the States in their prescription 
monitoring plans because that gets to this core issue of the 
starting point of the prescription.
    And so, it is both about naloxone, making sure that we 
understand its use and make its use easier in communities and 
support that. That is some of the work in SAMHSA that we will 
be doing.
    At the same time, we need the stronger prescription 
deadlines--guidelines, and so those are two different things 
that we are working on. One is more from CDC and that part of 
the organization. The other is SAMHSA working with communities 
as they are trying to work through the issues and do the 
implementation of the naloxone and things like that on the 
ground.

                                 EBOLA

    Mr. Dent. Thank you. As we discussed yesterday--thank you 
for your call--Ebola, of course, is a very important issue. And 
I am pleased to say that there is a lot of activity in my 
congressional district on that issue. One company, OraSure, is 
developing a rapid diagnostics working with CDC and others and 
NIH.
    But I am also pleased to say that there are two health 
systems in my district, too, that volunteered to make 
investment to become designated Ebola treatment centers. What 
advice should I give them about the process to take the next 
step to be considered a regional center?
    Secretary Burwell. With regard to the consideration of a 
regional center, I mean, that is something that coming through 
ASPR, the Assistant Secretary for Preparedness and Response, 
and working with HHS's regional office would be the next step 
on that part.
    The other part that I think they should do is be in close 
contact with their State health departments because the State 
health departments are going to play a role in two things. One, 
as we work through where the regional location will be. But 
second, some States will actually also have additional 
hospitals that will be treatment facilities, in addition to the 
issue of the one--you know, the regional designate.
    And that is so that we have a capability to expand if we 
ever need it. At the point at which we were in the middle of 
the Dallas situation, we did not know. You know, we thought we 
had a sense, but one had to plan for the worst case.
    So those are the two places that I would encourage those 
hospitals to speak.

                                 LIHEAP

    Mr. Dent. Thank you. And we will follow up.
    And just briefly, too, Madam Secretary, move to LIHEAP. 
Given the low cost of crude oil, which has translated into 
heating oil prices being on par with and sometimes lower than 
the equivalent natural gas price, why would HHS be using 
valuable LIHEAP program dollars to switch recipients' fuel 
systems at a cost of $10,000 on average when there is no real 
need, given the current price of fuel?
    Current LIHEAP funds could go to help consumers make 
simple, cost-effective upgrades that immediately reduce 
emissions and save them on their monthly bills to help pay for 
the fuel they are currently using. And do you really think it 
is appropriate for HHS to use LIHEAP rules to discriminate 
against homeowners based on the fuel they use at this time?
    Secretary Burwell. With regard, I have focused on actually 
the movement of the money in terms of LIHEAP during this winter 
season since I have been at the department. With regard to this 
specific issue, it is not one that I have looked at and I will 
look into.
    Mr. Dent. Yes, I would appreciate it because there is some 
concern that why make the conversions now when the price of 
fuel oil is comparatively low. And it seems like there is some 
type of discrimination based on type of fuel used, and I think 
there is a better way to allocate those LIHEAP dollars. So I 
would appreciate you getting back to me.
    Secretary Burwell. And as a part of our budget proposal, I 
think as the ranking member mentioned, we are flat. But I think 
one of the things that is important is actually we are trying 
to put in contingency and other monies that would be more 
targeted to when there are changes so we can act and react in 
terms of pricing.
    And so, that is an important part of what we have done, and 
I will look at this. But as we think about this in the context 
of the budget, we have tried to create a situation where the 
additional funds would be something that would help us be more 
flexible in reacting to situations that we always cannot always 
predict, which is why I am attaching it to your issue of the 
changing price.
    Mr. Dent. Well, I am going to yield back since I have time 
left and just doing my duty here, Mr. Chairman.
    Mr. Cole. Thank you very much. I appreciate your 
generosity.
    Just in the interest of trying to get as many questions in 
as we can in the limited time that we have left, I am going to 
reduce the question time to 2 minutes, if I may, for all 
concerned for a second round.
    So, with that, I recognize the gentlelady from California.

                           PSYCHOTROPIC DRUGS

    Ms. Roybal-Allard. Madam Secretary, I have had a 
longstanding concern about the use of psychotropic drugs to 
treat children with behavioral problems. And in the past, my 
colleague Representative DeLauro and I asked the GAO to issue a 
report. And what GAO found was that the children on Medicaid 
are prescribed these medications at twice the rate of privately 
insured children and that 18 percent of foster children were 
prescribed psychotropic medications often in amounts that 
exceed the FDA guidelines.
    So I was pleased that your budget calls for a 5-year 
demonstration project to encourage States to provide evidence-
based psychosocial interventions that could be used hopefully 
in place of or in combination with the drug treatment. So very 
quickly, I have three related questions.
    First, has the department considered reaching out to 
organizations like a Boys Town Hospital that have had 
considerable success in reducing these psychotropic 
medications? And also because, according to the GAO report, 
psychotropic drugs represent the single largest expenditure in 
Medicaid. That is over $2,800,000,000 in 2007. So has CMS done 
any research to determine whether reimbursement policy may be 
feeding this problem?
    And also what research has been undertaken to address the 
problem that is so critical to children's long-term 
development, and what percent of research is focused on looking 
at this?
    Secretary Burwell. So, first, I just want to say thank you. 
It is that study that I read when I was at OMB that led me to 
very strongly support this and then, when I got to HHS, worked 
to expand the effort. So thank you for that. That piece of work 
is part of what made this policy.
    The policy is actually to pursue and that is what the 
dollars are, to pursue, so that we get to the best practices. I 
want to check specifically if we are working with not-for-
profits. I know that we are working with States. But you have 
raised an issue of not-for-profits. We need to check on that.
    With regard to the issues of the payment, it is an issue 
that we are looking at if in terms of how we are doing our 
payments, if that is a part of the issue that is exacerbating 
it. So that will be a part of what we are doing.
    Ms. Roybal-Allard. Thank you.
    Mr. Cole. Madam Chairman, I have other questions, but I am 
going to hold mine and submit them for the record to you so we 
can indulge the other Members.
    Mr. Cole. I want to move to the gentleman from Idaho.

                         CONTRACT SUPPORT COSTS

    Mr. Simpson. Thank you.
    Quickly, I appreciate the fact that your budget fully 
supports the estimated contract support costs for Native 
Americans.
    Secretary Burwell. Yes.
    Mr. Simpson. You say that you want to modify the program by 
reclassifying it as a mandatory appropriation in 2017, not this 
year's budget, but next year's budget. Whenever I try to do 
something on the mandatory side or try to put something in 
mandatory, I have to find the pay-for.
    How are you going to pay for it? Have you come up with that 
yet? Have you thought about how we are going to make it 
mandatory?
    Secretary Burwell. So with regard, because we have done the 
entire budget and we have paid for everything within the 
budget. And so, the question of one-for-one pay-fors, we have 
our pay-fors throughout the budget in terms of both on the 
mandatory side, as well as on the discretionary side in terms 
of puts and takes.
    So it is embedded within the budget our payment for it. 
There is not a specific pay-for for it, but we believe it is 
the right place to be with regard to this issue of the contract 
support cost.
    Mr. Simpson. I do not disagree with you. On the other side 
of that, the mandatory funding for community health centers is 
ending October 1st. Have you proposed continuing making that 
mandatory funding in the future?
    Secretary Burwell. Yes. It is a mix. And our budget is a 
mix, and we believe it is important to continue that on the 
path that was done as part of previous legislation.
    Mr. Simpson. Thank you.
    Mr. Cole. Thank you.
    The gentlelady from Connecticut.
    Ms. DeLauro. Thank you.

                               CHILD CARE

    On child care just very quickly, pleased to see a 
$370,000,000 increase for child care. A portion is requested is 
$100,000,000, pilot programs. Can you talk a bit about that?
    And then if you can just talk about the consolidation on 
food safety from your perspective of that effort under HHS and 
those responsibilities?
    Secretary Burwell. So the $370,000,000 is to implement the 
bipartisan child care reauthorization that you did. With regard 
to the specific of $100,000,000, there are populations, parents 
who actually work differing hours, people who work at night, 
and so there are a number of different populations that are not 
being reached by our child care.
    And so, we need to make sure that for working Americans who 
may have circumstances that are not the traditional 
circumstance, that we are thinking about it. That is what that 
money is about.
    With regard to the food safety issue, what we are trying to 
do is get a system that is simpler and higher quality. And 
because pieces sit in a different place, you know, everyone 
uses the pizza example that if it is a cheese pizza, it is at 
one place. If it is a pepperoni pizza, it is regulated by two 
different parts of the Government. That is a part of what we 
are doing as we propose this effort.
    Ms. DeLauro. Well, you are putting legislation forward?
    Secretary Burwell. At this point, I think this is an issue 
that we want to hear and understand where the Congress is.
    Ms. DeLauro. Thank you.
    Mr. Cole. The gentleman from Arkansas.

                                 EBOLA

    Mr. Womack. Yes, just a couple of real quick questions. I 
want to go back to Ebola for just a minute because we knew that 
it was on the material threat determination list for more than 
a decade, but therapeutics and vaccines not fully developed.
    Can you tell us, and I am not asking you to pull out your 
crystal ball and predict the next Ebola, but what else is not 
on that--that is on the threat assessment list we are still not 
entirely prepared for and where we should focus maybe some of 
that concern?
    Secretary Burwell. So I think the most important place for 
us to focus our preparedness in terms of we need to continue 
working on those lists. And whether it is airborne things or 
things like Ebola, we need to continue that. But the place 
where I think we can make the most progress to protect the 
homeland is by putting in place the things that are part of the 
Global Health Security Agenda.
    And why that is the case is because when you saw what 
happened in Nigeria, we all know Nigeria had the cases. They 
had up to almost 20 cases, but it did not spread, and it is 
because they had the ability to do the prevention, detection, 
isolation, and contact tracing.
    And so, putting those pieces in place in the places where 
these things will come from is a very important step and one of 
the ones that I think we need to emphasize most.
    Mr. Womack. Assuming that there is always going to be 
insufficient funding--and I think that is an accurate 
assumption that we can all make--to deal with these kinds of 
issues, how would you prioritize?
    Secretary Burwell. With regard to--I think with regard to 
the Global Health Security Agenda monies, we prioritize those 
by country need. And the other thing we have to do and we are 
doing is we have got to get other countries to help pay.
    Mr. Womack. If all the smart people in your organization 
calculated the total cost to deal with all possible threats, 
what would that number look like?
    Secretary Burwell. I do not think we have done it in an 
aggregate fashion in terms of all total costs in terms of 
modeling it that way. I think what we do is on the pieces we 
prioritize, and the area you were talking about are the anthrax 
issue or those issues, we prioritize that way.
    Mr. Womack. Just as an aside, you know, Mr. Chairman, we 
were all, most of us were treated to a visit up to NIH, and I 
found it pretty impressive that there was a young lady there--I 
want to say her name was Sullivan--that was working back in the 
vaccine area that had pulled out her--in fact, you made the 
comment that must have been her----
    Secretary Burwell. Her notebook.
    Mr. Womack [continuing]. Junior high notebook.
    Secretary Burwell. It was her notebook, and she had worked 
on the Ebola vaccine. I have met with her.
    Mr. Womack. Amazing.
    Secretary Burwell. Yes.
    Mr. Womack. That what was truly--what stood out to me and 
to her credit was the fact that she had done all of this work 
before, when it was not even really----
    Secretary Burwell. No one cared.
    Mr. Womack. It was more of an afterthought than anything 
else, and she was able to go back to that research and expedite 
by as much as I think 6 months the time it would take to 
respond.
    Secretary Burwell. Yes.
    Mr. Womack. I just thought that was a credit, and it speaks 
well of the NIH.
    Mr. Cole. And Mr. Harris, you will have the last questions.
    Mr. Harris. I guess I sit between us and lunch. [Laughter.]

                                 GRANTS

    Just very quickly, you know, as you know, the ORR grants--
provides grants to institutions that provide housing for the 
UACs. And you know, I was very disappointed by the Christmas 
Eve regulation that basically set regulations on some of these 
faith-based. You know, six of the nine grantees are faith 
based, and they do feel that their religious freedom is going 
to be impinged by these regulations.
    And you know, you find yourself at the department that is 
really the tip of the spear in what many people, myself 
included, feel is a war on religious freedom in this country. I 
would hope that you take their comments, the comment period 
ended Monday, into account for the final regulation.
    When your predecessor was here last year, I asked her about 
the nontransparency of abortion coverage in exchanges, you 
know, and the department comes out with their definition of 
separate payments that is just mind-boggling because it is not 
a separate payment, which would add to transparency.
    So I would hope that you would take some steps to modify 
the rule to make it really a separate payment which provides 
some transparency.
    And just finally, a question for you, what has come to my 
attention is that a lot of the plans on the exchanges are 
putting all the drugs for a given disease in their top tier. So 
what you are doing is you are basically giving people a plan 
that covers a routine physical, but God forbid they get a 
disease where they require an expensive medication.
    Tiering is actually doing two things. One, it actually 
discourages them from taking a plan. So it actually--it puts 
high-risk people and it does not allow them access to really 
all the plans.
    And the other one is, strangely enough, tiering is actually 
supposed to discourage people from taking the top tier drugs 
because a lower tier drug would do the same thing. But what we 
are finding is that all the drugs for a disease are being put 
in the top tier.
    Is this adverse tiering something that the department is 
going to do something about in these plans?
    Secretary Burwell. With regard to the issue as these issues 
have come in and been raised, they have been raised in some 
specific actual disease areas, HIV and some others. We are 
continuing to look at them on a case-by-case basis and overall.
    And so, when these have come in, we are having the 
conversations and understanding and working with the States and 
the insurers to talk about these issues. As these things come 
in, we want to work on and figure out how we can create a 
situation where people do have the access, which I think is 
your point, to the quality care they need. We agree with that.
    Mr. Harris. Thank you very much. I yield back.
    Mr. Cole. Madam Secretary, I want to thank you for your 
testimony today. They did not lay a glove on you. I am not 
surprised. But we very much appreciate your taking the time----
    Secretary Burwell. I have a long to-do list.
    Mr. Cole. Well, I suspect it will get longer once the 
questions for the record arrive.
    Secretary Burwell. I do as well.
    Mr. Cole. But seriously, thank you very much for your 
service. Thank you for your cooperative and open attitude. We 
very much look forward to working with you as we sort through 
these issues and find the appropriate balance.
    Secretary Burwell. Thank you.
    Mr. Cole. So have a good day, and thanks for being here.
    Secretary Burwell. Thank you. Thank you.
    
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                                      Thursday, February 26, 2015.

  OVERSIGHT HEARING--THE VITAL RESPONSIBILITY OF SERVING THE NATION'S 
                     AGING AND DISABLED COMMUNITIES

                               WITNESSES

CAROLYN W. COLVIN, ACTING COMMISSIONER, SOCIAL SECURITY ADMINISTRATION
KATHY GREENLEE, ADMINISTRATOR, ADMINISTRATION FOR COMMUNITY LIVING, 
    HEALTH AND HUMAN SERVICES
    Mr. Cole. We actually really will open, but I want to thank 
everybody for being here on a very bad day and very difficult 
weather wise. Let me just go through my formal opening remarks.
    But good morning, and welcome to the Subcommittee of Labor, 
Health and Human Services, and Education, and we look forward 
to your testimony today.
    The Social Security Administration and the Administration 
for Community Living both share a particularly important 
mission serving two of the Nation's most vulnerable 
populations, the aging and disabled communities.
    I welcome and thank the Commissioner of Social Security, 
Carolyn Colvin, and the Administrator of the Administration for 
Community Living, Kathy Greenlee, for their participation in 
today's hearing. And it really is good to have both of you 
here. I really, frankly, appreciate the job you do, and these 
are some of the more important agencies we have.
    The hearing is focused on the fiscal year 2016 budget 
requests of these agencies, as well as the quality of the 
services they provide to these two communities. While the roles 
of SSA and the ACL play in supporting the aging and disabled 
differ, the services they provide are vital to each community 
and ought to be held to the highest standards.
    With regard to the budget request the SSA submitted, it 
appears that you have taken a number of steps in the past year 
to improve the quality of services available to the public, 
both at your local offices and online. And I am pleased to see 
that your fiscal year 2016 budget proposes to continue that 
progress, Commissioner Colvin, and really appreciate your 
efforts in working on this vital program.
    I am additionally encouraged by your recent decision to 
stand up a new anti-fraud office to tackle the constant threat 
of misuse of taxpayer dollars. Yet the number of individuals 
applying for disability insurance, with that number at an 
historically high level, SSA continues to struggle with 
managing the disability claims workload.
    I have a number of questions about the actions you are 
taking to overhaul SSA's management of this program. With the 
Disability Trust Fund on the brink of insolvency, it is all the 
more crucial that SSA is wisely using the resources Congress 
provides to improve its management of the disability insurance 
program.
    In reviewing the budget request of ACL, what first struck 
me was the sizable increase you are seeking, Administrator 
Greenlee. I am interested in understanding what impact those 
additional services will have on the valuable programs the 
elderly, the disabled, and their caretakers rely upon.
    My question for you is what can the ACL do within its 
current level of resources to improve and modernize these 
services in partnership with the State and local governments 
and numerous nonprofits that carry out the very work that we 
will be discussing today?
    I look forward to our discussion of all these matters. And 
in just a moment, I am going to yield to my good friend, my 
ranking member from Connecticut, for whatever opening statement 
she cares to make. But I would ask you, as we proceed to the 
testimony, to keep in mind we are looking at budgets that have 
been submitted by the President that assume, frankly, a great 
deal of additional revenue that this committee does not have 
the authority to provide.
    In other words, they assume tax increases, fee increases, 
some changes in mandatory spending that may or may not and, 
frankly, I think are likely not to happen. So the reality is we 
may well be looking--we do not know what our allocation is yet, 
but a pretty flat budget full of a lot of hard choices.
    So as you are going through your testimony, knowing what 
your priorities are, knowing, gosh, if we cannot get everything 
we would like to get in terms of funding, what are the most 
important things where the efficiencies can be achieved? I 
think that is going to be something we are really looking for 
your suggestions and advice on.
    So with that, again, I want to yield to my ranking member 
for any statement she cares to make.
    Ms. DeLauro. Thank you very much, Mr. Chairman. Thank you 
for holding this hearing on a set of programs that provide 
critical support to our Nation's seniors and to people with 
disabilities.
    Commissioner Colvin, Assistant Secretary Greenlee, we 
welcome you to the committee. Pleased that you are here. It is 
a great opportunity to talk about and answer questions on your 
agencies' important programs.
    For tens of millions of Americans, the benefits are 
critical, critical to maintaining a basic level of financial 
security. Now Social Security turns 80 years old this year, and 
before 1935, what old age meant, economic insecurity for 
practically all seniors. And today, two-thirds of seniors rely 
on Social Security as their primary source of income, and it is 
a vital strand in the fabric of our community.
    I like to describe, Mr. Chairman, the Social Security 
system. I think the genius of it is its intergenerational 
connections. It ties me with my mother, who worked all of her 
life and put that money into Social Security. It is my job now 
to work to make sure that we keep the effort solvent, and my 
kids then are tied to me. And I do believe that that is the 
strength, which ought to be preserved.
    In fiscal year 2016, the Administration, Social Security 
Administration will distribute more than $1,000,000,000,000 in 
benefits to seniors and to people with disabilities. The figure 
includes nearly $800,000,000,000 in old age and survivors' 
benefits, $150,000,000,000 in disability benefits, and 
$65,000,000,000 in Supplemental Security Income benefits.
    And yet SSA runs these programs on a relative shoestring. 
Operating expenses for SSA are less than 1.3 percent of the 
size of the program. Less than 1.3 percent, something I think 
should be noted.
    And despite this laudable efficiency, we have spent the 
past 5 years starving its operating budget. Adjusting for 
inflation, that budget has been cut by more than $1,200,000,000 
since 2010. As a result, SSA lost 11,000 staff between 2010 and 
2013, has closed at least 64 field offices since 2010.
    The cuts have consequences, real consequences. People spend 
seven times as long on the phone to reach an SSA agent. Five 
times as many callers are faced with a busy signal. The average 
wait for a disability hearing decision is now more than 15 
months. We all believe that that is unacceptable.
    I expect much of our time this morning may focus on 
backlogs and delays in services at SSA. I have a number of 
concerns myself, but I ask my colleagues to keep in mind that 
SSA is being asked to do its job with less funding and fewer 
staff. And until we eliminate sequestration, restore the proper 
resources to the SSA, we should not be surprised if we see 
growing backlogs, more cuts to seniors, and additional field 
office closings.
    Our second agency this morning, the Administration for 
Community Living, administrates programs that are no less 
important. Programs allow seniors and people with disabilities 
to live active and independent lives.
    Every year, ACL funds the delivery of more than 200 million 
meals to over 2 million seniors, most of whom are low income; 
provides critical support services that enable families to care 
for their loved ones at home. Assistant Secretary Greenlee 
notes in her prepared testimony that over 80 percent of long-
term support and services come from family members. ACL's 
programs enable families to continue to provide these services 
at home.
    The programs also save taxpayers money. Without them, many 
families would be unable to care for their loved ones in their 
homes. They would be forced into expensive nursing homes or 
institutional facilities, often paid for by Medicaid.
    And yet we persist in shortchanging these programs, and 
over the past 5 years, after accounting for inflation, ACL's 
home and community-based support services and family caregiver 
programs have been cut by 13 percent. Nutrition programs cut by 
9 percent. Programs for individuals with developmental 
disabilities slashed by 20 percent.
    Devastating to millions of families across the country who 
are finding it harder and harder to care for the people they 
love. Instead of cutting services for seniors, people with 
disabilities, and working families, we need to invest in them.
    I strongly support SSA's request for an increase of 
$700,000,000, which would reverse about half of the cuts to its 
operating budget over the last 5 years. I also support the 
President's proposal to increase funding for senior nutrition 
by $60,000,000 and support services for seniors by $40,000,000.
    The increases, in my view, are not nearly enough to address 
the needs of American families. If we truly commit to these 
agencies, if we fund them in the way that keeps pace with 
growing need and rising costs, we can help seniors, we can help 
people with disabilities to live in their own homes with help 
from their families at a fraction of the cost of an 
institutional setting.
    Cutting these agencies' budgets will do the opposite, and 
when we cut programs like the ones under discussion today, we 
cannot expect them to do more with less or even the same with 
less. They will do less with less. That is inevitable.
    And I look forward to your testimony and your conversations 
and our discussion today.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    If we can, we will have--thank you. Sorry to make your life 
that difficult.
    If we can, we obviously would like to have your testimony 
now. Obviously, anything, your entire statements, written 
statements will be entered into the record. And if we can, we 
will recognize you, Commissioner, first.
    Ms. Colvin. Thank you.
    Chairman Cole, Ranking Member DeLauro, and members of the 
subcommittee, thank you for this opportunity to update you on 
what we are doing to provide quality service to the American 
public, including our seniors and those with disabilities.
    My name is Carolyn Colvin. I am the Acting Commissioner of 
Social Security. I am very pleased to be here with my good 
friend and colleague, Kathy Greenlee.
    At Social Security, our record shows that when we receive 
adequate and sustained funding, we deliver. We are amongst the 
most efficient and effective Federal agencies. Our 
administrative costs are only 1.3 percent of all benefit 
payments.
    We achieve great success when our can-do attitude is 
matched with sufficient resources. However, in fiscal 2011 
through 2013, we lost about 11,000 Federal and State employees 
due to budget cuts. Even though we worked hard to mitigate 
those losses through automation and business processes, our 
service suffered.
    We are grateful for the funding Congress provided to us in 
fiscal 2014. As a result, we were able to hire new employees to 
replace half of those losses, and we are now seeing the results 
of those hires.
    Thanks to our fiscal 2015 appropriation, we will be able to 
restore some field office hours, improve wait times to our 
National 800 Number and enhance our online services, and handle 
more hearings. The fiscal 2016 President's request of 
$12,513,000,000 for our administrative account will help us 
address wait times and backlogs, reduce improper payments, 
protect the public with a variety of anti-fraud initiatives, 
and hire employees who can best serve the public.
    It will allow us to modernize our service delivery for the 
millions of people who count on us. It will also allow us to 
hire more Administrative Law Judges so we can complete a record 
number of hearings.
    However, resources alone will not be enough to address our 
backlogs. The current ALJ hiring process has not operated as 
efficiently as needed to fill vacancies. The Administration is 
creating a workgroup to review the process of hiring ALJs. In 
addition, within our agency, we are looking for ways to process 
hearings as efficiently as possible.
    We remain committed to protecting the integrity of our 
programs. Our continuing disability reviews and SSI 
redeterminations save billions of program dollars with only a 
small investment of administrative funds. With the President's 
request, we plan to complete more of these cost-effective 
reviews.
    We must position our agency for future success. Sustained 
and adequate funding will help us meet our challenges and 
enable us to provide service the public expects and deserves.
    I thank the subcommittee for your support, and I will be 
happy to answer your questions.
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    Mr. Cole. If we can, Secretary Greenlee, we will go to you 
next.
    Ms. Greenlee. Thank you, Mr. Chairman.
    Mr. Chairman, Ranking Member DeLauro, members of the 
committee, thank you for inviting us to come testify with you 
this morning.
    As you noted, my name is Kathy Greenlee, and I am the 
Administrator of the Administration for Community Living, as 
well as the Assistant Secretary for Aging. I welcome this 
opportunity to talk about how ACL plans to serve Americans in 
this budget we have requested for fiscal year 2016.
    It is also a pleasure to have the opportunity to appear 
with Carolyn Colvin. Commissioner Colvin and I have done 
multiple things together in the last few years and find this 
collaboration to be both pleasant and positive, in terms of 
work we can do together.
    I am here today on behalf of a very diverse group of 
people. I represent the 85-year-old who lives independently 
with a little bit of help, such as rides to the doctor's office 
and lunch provided by her local senior center.
    I am also here on behalf of the 25-year-old veteran. An IED 
in Afghanistan took away his balance and short-term memory. 
With the support of his wife and some in-home services, he is 
learning new ways to achieve his dreams.
    I am here for the 19-year-old with Down syndrome who is 
about to graduate from high school. Like her friends, she is 
looking forward to college, finding a job, and starting the 
next chapter of life.
    And ultimately, I represent most of us in this room. At 
some point in our lives, most of us will need assistance to 
maintain our independence, and many of us will provide care for 
a loved one.
    The Administration for Community Living was created around 
one core idea, that older adults and people with disabilities 
should be able to live independently and participate fully in 
their communities. This work has never been more important.
    By 2020, there will be more than 77 million people over the 
age of 60 in the United States. As many as two-thirds of them 
will eventually need help with dressing, showering, and similar 
activities. In addition, nearly 57 million people with 
disabilities live in non-institutional settings, and about 20 
percent of them need help with daily living tasks.
    We know that people enjoy a better quality of life when 
they are able to live at home. Community living also makes 
financial sense. The average cost of a shared room in a nursing 
home is around $75,000 a year, and residential facilities for 
people with disabilities can cost three times that amount. And 
when people cannot afford those costs, Medicaid is the primary 
payer.
    In contrast, the supportive services ACL provides can 
enable people to remain in their homes and completely avoid or 
delay these more expensive services. With our budget request, 
ACL will work towards this goal in four ways.
    First, we will increase access to home and community-based 
services and supports. A $42,800,000 increase for senior 
nutrition programs will help provide meals to over 2 million 
more older adults. An additional $38,500,000 will help States 
assist seniors with daily activities such as offering rides to 
doctors and grocery stores, and they will be able to provide 
adult day services.
    A $5,000,000 increase will help Centers for Independent 
Living help people with disabilities leave nursing homes or 
other institutions and assist young people with disabilities as 
they move from high school into adult life. ACL will also 
invest in supporting families, who provide the vast majority of 
assistance to older people and people with disabilities.
    When families become overwhelmed by the challenges of 
caregiving, Government-funded solutions, which are often far 
more expensive, are the only option. ACL will direct 
$177,000,000 to help alleviate the strains and enable families 
to continue to assist their loved ones.
    Second, ACL will expand efforts to connect people with 
information about programs and services. We will invest an 
additional $13,900,000 in Aging and Disability Resource 
Centers, which work with States to improve access to resources 
to help people remain in their communities.
    To share one success story, ADRCs have worked with the 
Veterans Administration to empower veterans to select and 
manage the supports that they need to live at home.
    Third, we will expand protections for our populations at 
most risk. More than 10 percent of older adults are abused, 
neglected, or exploited annually, and people with disabilities 
are 4 to 10 times more likely to be abused than peers without 
disabilities.
    With the additional $21,000,000 requested this year, ACL 
will advance our efforts to provide Federal support to the 
States for their existing Adult Protective Services programs. 
This will include investments in innovation and research, as 
well as infrastructure development for data collection.
    Finally, ACL will develop and improve evidence-based 
programs to share best practices. We will invest $20,000,000 to 
modernize the senior nutrition programs, which help older 
adults remain healthy and independent. This will ensure the 
continuity of the quality of the programs and help the programs 
prepare to meet the changing demands of seniors as the baby 
boom generation ages.
    In addition, this budget reflects much-needed 
infrastructure. The transfer of the Rehabilitation Act and 
Assistive Technology programs to ACL in 2014 and the transfer 
of other programs in earlier years has created a stronger 
organization that will better serve the country. But these 
transfers also created costs that were not fully funded.
    We are committed to supporting both the transferred 
programs and the existing programs, such as those provided by 
the Older Americans Act and the Developmental Disabilities Act. 
As Administrator of ACL and Assistant Secretary for Aging, I 
have been encouraged by the collaborative and entrepreneurial 
spirit of our Federal, tribal, State, and local partners. We 
are making a difference in preserving the rights of all people, 
regardless of age or ability, to fully participate in their 
communities.
    However, we are at a critical juncture. The populations we 
serve are growing. We must continue to work together to ensure 
that older adults and people with disabilities have the 
services and supports they need to live at home, participate in 
their communities, and avoid more costly alternatives. This 
budget will allow ACL to continue to make and improve upon the 
important investments to support that goal.
    Thank you very much.
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    Mr. Cole. Thank you very much.
    And if we can, I am going to start the questioning, 
Commissioner, with you. And as I discussed in my opening 
statement, there is clearly a compelling need to reform SSA's 
management of disability insurance program.
    And I know you are taking some steps right now to try and 
address the backlog with the creation of units focused 
exclusively on processing disability claims and the effort to 
bring on additional administrative law judges that you 
mentioned in your opening statement. Unfortunately, it appears 
like it is going to take quite a bit of time to actually make 
much progress in this area.
    I am also concerned about the differences between States 
when it comes to the approval rate for disability application. 
It strikes me as something that has more to do with who is 
making the decision, and the lack of uniformity there is a 
considerable concern.
    So given those two concerns, could you bring us up to date 
on what you plan to do this fiscal year to process disability 
claims and including both the initial claims and the appeals? 
And then could you discuss in your view some of the reasons for 
the disparate approval rates by States and some of the measures 
you might be taking to try and address that concern?
    Ms. Colvin. Okay, thank you very much.
    Let me start first with what we are doing to try to address 
the entire disability adjudication process. Certainly, 
resources allow us to get hearings done and allow us to do our 
initial claims. But in addition to that, I have established an 
intercomponent committee that is looking at our process from 
beginning to end to see if there are efficiencies that might 
exist that we have not already identified.
    We know that we cannot staff our way out of the backlogs 
that we have. I do believe we are a very efficient agency. As 
mentioned earlier, our overhead is only 1.3 percent. But I 
think there is always room for improvement, and so we are 
looking at that.
    I think the President's budget will allow us to make some 
improvements. With the early intervention demonstration 
projects, we want to see if there is the ability to have people 
not come onto our rolls as quickly and to stay in the job 
market. We believe that perhaps with some supports, that might 
occur.
    We have had demonstrations that have demonstrated that some 
interventions will allow people to return to work, but they 
have been very modest. So we believe that we have to do things 
that will stop them from coming on the rolls to begin with.
    Mr. Cole. When you talk about early intervention, could you 
give us some of the specific things that you do when you are 
trying to sort of head somebody off from going onto disability?
    Ms. Colvin. We are working with HHS so that we can make 
certain that we select the right population, and we are looking 
potentially at those individuals who have been denied 
disability to begin with, to see if there are things that will 
enable them to continue to work and not have to come into our 
system as quickly as they normally would.
    And we think that perhaps some supportive vocational and 
medical services, some opportunities for accommodations on the 
job may help. So one of the proposals would include work 
incentives to employers. But also we need to really test to see 
what types of supports would work. I think that is one of the 
areas that we can certainly work with Secretary Greenlee on 
since she is working with the population with disabilities.
    We know the people want to work, and we know that many of 
them are in and out of the job market. And we believe that with 
some support they may be able to do so. We do not have a 
specific answer at this time. We really need to demonstrate 
what will work. The $50,000,000 that has been requested would 
allow us to do research. We would have an evaluation component 
so we could determine what works and what does not work.
    We would work with the local groups at the local level. And 
I think that with vocational rehabilitation, with Aging, and 
some of the other services, we would be able to come up with 
some solutions.
    Mr. Cole. And if you could, if you could address just the 
issue of disparate outcomes in different States?
    Ms. Colvin. I think that my answer would be that is not 
unexpected. It depends upon the populations in those States.
    For instance, if you are in a community that has a labor 
force that is doing very hard work, coal mining or some of the 
other types of industries, you would see a higher rate of 
disability perhaps as a result of aging. In your areas where 
you have more office-type jobs or more IT jobs, you might, in 
fact, see less approvals.
    We have inline quality reviews. We have a strong quality 
review program to make sure that we are making the right 
decisions at both the initial as well as through the hearings 
process. We focus a lot on that because we want to make sure 
that the decisions are correct.
    We do reviews of 50 percent of all allowances that are made 
at the DDS level, which is the first level prior to a benefit 
ever being paid. The accuracy rate has consistently remained 
high. So we do believe that the decisions that are made at the 
DDS level are the right decisions.
    Now I know you have had some concern about at the hearings 
level, and that is usually because the case is probably well 
over a year, sometimes 2 years by the time it gets to the 
hearings level, and so, you have a different case. You have 
situations where individuals' disabilities have increased, and 
so you are likely to get a different decision there.
    Mr. Cole. Okay. Just very quickly because I am going over 
my 5 minutes here, and I am going to be pretty rigorous in 
enforcing it on other people. So, but I will take it probably--
so you are pretty comfortable in your own mind then that most 
of the disparities we are seeing really do reflect population 
differences at a State level?
    Ms. Colvin. I really am. We do focused reviews at the ALJ 
level.
    We do pre-effectuation reviews. In addition to doing those 
reviews, we do policy reviews to see if the decisions are 
policy compliant.
    Our approval rate now at the DDS level is 32 percent. Some 
would argue that that is too low. I try not to look at approval 
or disapproval, but really look at the right decision. But for 
the past several years, we have been consistent with the rate 
of disapprovals.
    Mr. Cole. Thank you very much.
    I recognize the gentlelady from Connecticut.
    Ms. DeLauro. Thank you, Mr. Chairman.
    And I want to thank our guests this morning. Just very, 
very quickly, with regard to early intervention that the 
chairman talked about, are you working with the Office of 
Disability Employment Policy, Department of Labor, National 
Institutes on Disability, Rehab----
    Ms. Colvin. Absolutely.
    Ms. DeLauro [continuing]. Research, as well as with 
Commissioner Greenlee here? So you are working with all of 
those efforts?
    Ms. Colvin. Yes. Yes.
    Ms. DeLauro. Is there a percentage of veterans in that 
population that you are working with?
    Ms. Colvin. Well, we have 1 million veterans on our 
disability rolls right now, and we have instituted procedures, 
as you know, to expedite the processing of those cases. And 
those numbers do grow.
    Ms. DeLauro. Okay. And again very quickly, if I might, this 
is about the backlog that the chairman addressed. Worst-case 
scenario in which sequestration remains in effect and 
discretionary appropriations remain flat, what would happen to 
the hearing backlog and average processing if SSA is level 
funded next year?
    Ms. Colvin. Well, for me, it would be catastrophic. We 
already have over a million cases backlog with the 2015 budget. 
And if we can get the ALJ candidate register and the ability to 
hire judges, we expect to be on a trajectory that would allow 
us to begin to reduce those backlogs by 2019.
    If we begin to have flat funding, we are going to have a 
significant deterioration because we cannot do a hearing 
without a judge, and we have lost a significant number of 
judges over the years. It takes time to train them and to get 
them prepared to handle a full caseload.
    Ms. DeLauro. Let me address service cutbacks, Commissioner. 
We talked about at least 64 field offices closing. We talk 
about the wait time for folks and effort. Let me get to the 
question.
    What improvements in customer service--including in-person 
and phone waiting times, claims processing, and other key 
service methods--could you provide if you receive funding at 
the President's budget level and the kinds of tradeoffs you 
have to make if the funding continues at the current level?
    I am going to add another question to that. Senate report 
notes that, ``Hiring freezes resulted in disproportionate 
staffing across the Nation in 1,245 field offices, with some 
offices losing a quarter of their staff.''
    Will SSA be able to address staffing shortages in offices 
that lost a disproportionate number of personnel, and how are 
field offices being affected by the difficulty Americans are 
having getting service on the 800 number?
    Ms. Colvin. Let me start off by saying that we have 
received over $3,000,000,000 less over the last 3 years than we 
requested, and you have seen what the impact has been. We have 
had a significant increase in waiting times both on the 800 
Number as well in the field offices, and there has been an 
impact on the claims processing.
    The $700,000,000 increase that we requested will allow us 
to be able to replace those staff that will retire as a result 
of the fact that our workforce is aging. So we would be able to 
replace our losses, and we would hope that we would be able to 
have a few additional staff assigned to those field offices.
    The majority of my budget is personnel. It is either 
personnel or IT. So when we have less money, it means we have 
less staff, and it means less services. We have tried to create 
efficiencies, and we have gotten efficiencies through our 
automation. But we recognize that our field office structure is 
always going to be our primary structure because we have 
individuals who need face-to-face assistance, and we have 
others who prefer face-to-face.
    So although we are making great progress with our IT 
development, it is not going to replace our field offices, and 
we need staff to be able to keep those offices vibrant.
    Ms. DeLauro. And would you have to continue to close 
offices or to cut back hours, and what is the plan to begin to 
restore those offices with additional money and to restore the 
hours? Each of us has a district office that relates very 
directly with Social Security. So when the increased complaints 
come in because of hours or closures, that winds up being a 
problem that we are faced with as well. So----
    Ms. Colvin. Social Security is the face of Government. We 
touch the lives of almost every American, and so we need to be 
in the field. There would certainly be a significant impact. 
Yes, we did close a significant number of offices last year, 
and we have a commitment that we will not continue to close 
offices, hopefully, if we get our 2016 allocation.
    Beginning March of this year, we will be restoring 1 hour 
per day of service on Mondays, Tuesdays, Thursdays, and Fridays 
in field offices that I had to eliminate as a result of the 
budget cuts. That is going to allow more people to be seen and 
people to be seen more quickly. Now should we not get the 
budget, then we are going to have some challenges to be able to 
keep that momentum.
    I will tell you that there are no plans to close offices in 
2015 and 2016 as a result of our 2015 allocation, and we really 
thank the Appropriations Committee for that. We were able to 
replace about half of the 11,000 staff that we lost.
    But remember, we have an aging workforce. As fast as we 
hire staff, we are also losing staff. We are just trying to 
keep up.
    I would also like to point out that about $350,000,000 of 
our budget are increases in fixed costs, and you have that 
increasing each year. Those are costs that we cannot change.
    We would also be able to significantly address our program 
integrity issues. We have demonstrated that by doing medical 
reviews, continuing disability reviews, that we are able to 
save $19 for every $1 that we spend. And those continuing 
disability reviews are critical because they are used to remove 
people from the rolls who are no longer disabled.
    In FY 2014, we had a backlog of 1.3 million in that area. 
With the President's budget, we would be able to do 908,000 
CDRs in 2016, which would be a significant reduction of the 
pending cases, and about 17 percent of those individuals are 
projected to come off the rolls as a result of the reviews that 
we do.
    So it is a very cost-effective activity. We believe that we 
should have a dedicated program integrity fund so that we do 
not have to continue to choose between doing program integrity 
and doing customer service. That is where we are right now.
    Ms. DeLauro. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    The gentlelady from Alabama is recognized.
    Mrs. Roby. Thank you, Mr. Chairman.
    Commissioner Colvin, I want to go back to what--and thank 
you both for being here today. I want to go back to what the 
chairman was talking about a minute ago as it relates to the 
appeals. You reported in fiscal year 2014 that the allowance 
rate for disability appeals was 45 percent, and most of the 
individuals had already been subject to the initial denial 
review and the reconsideration process.
    And I understand that this has decreased from 2010, when it 
was at an all-time high of 62 percent. And I want you to, if 
you could, elaborate on the reason for the decrease. But I want 
to share my chairman's concern that we are still at almost 50 
percent succeeding at the hearing level after having already 
gone through these two processes.
    So can you address those two things, please?
    Ms. Colvin. Certainly, Mrs. Roby. Thank you for that 
question.
    As I mentioned, there are some negative consequences of 
backlogs. The older a case is, the more likely that it is not 
going to be the same case. So when someone comes into the DDS 
for a decision and they are disapproved, they have the right to 
appeal and have a reconsideration. They may be disapproved at 
that point.
    By the time they get to the hearing level, you are talking 
about a case that is well over 2 years old. So if someone 
actually has a disability, that problem has further 
deteriorated. In addition, there is new medical information 
over that period of time that the judge is going to take a look 
at.
    So you cannot look at the case that is first heard in the 
disability office and assume that that is the exact same case 
by the time it gets to the ALJ. At one time, we were well 
over----
    Mrs. Roby. Can I interrupt you for just a second? I 
understand that part of it, and I heard you say that to the 
chairman. But what can you attribute to the decrease from 62 
percent to 45?
    Ms. Colvin. I think that the decrease is due to quality 
reviews that have been put in place. There is a system that has 
been developed in ODAR, ``How MI Doing?'', which allows the 
judges to get feedback, to take a look at whether or not they 
are making policy-compliant decisions.
    We are using a lot of data analytics when we do reviews to 
see if there are particularly difficult areas where we need to 
do more training to be able to ensure that we are, in fact, 
getting a quality decision. We do some after the decision has 
actually been made, but we are always looking at how to improve 
the decision-making.
    I know at one time, this committee was concerned about some 
judges' approval rates and disapproval rates. I think that 
those have been brought closer to a norm.
    I think that it is a continuous quality improvement that we 
are attempting to make in the agency, the continuous training, 
and the improvement in our policies so that those who are 
adjudicating the cases clearly understand some of the more 
difficult decision areas.
    Mrs. Roby. Okay. Thank you.
    Can we switch gears and talk about the selection of 
administrative law judges? It is now being done by the Office 
of Personnel Management. What is your confidence level in their 
ability to manage the hiring of these individuals?
    Ms. Colvin. The process has been challenging for us. The 
President's budget is establishing a workgroup that will be led 
by the Administrative Conference of the United States, which is 
an independent agency that, hopefully, will work with us, work 
with OPM, and try to come up with a process that works better 
for us.
    One of the reasons that we have had such a backlog in our 
cases has been our inability to get judges because we have had 
trouble getting a registry. And as you know, last year Congress 
gave us funding for judges, but we were unable to bring the 
judges on because of the problem we had around the ALJ 
registry.
    Mrs. Roby. I mean, also the 1 million individuals waiting 
for decisions could attribute to the hardship in hiring these 
administrative law judges, I would suspect.
    Ms. Colvin. That is accurate.

                       ADULT PROTECTIVE SERVICES

    Mrs. Roby. Quickly, Ms. Greenlee, thank you for all your 
help with seniors and those with disabilities at ACL. I would 
like, and I do not have very much time left, but I would like 
to expand--for you to expand on the Adult Protective Service 
program. As GAO has expressed, collecting, maintaining, and 
reporting statewide case-level data for Adult Protective 
Service program is a challenge.
    And I guess the question to you is, is the technology 
infrastructure that you worked on with the Assistant Secretary 
for Planning and Evaluation still current, and what is your 
biggest hurdle in getting this up and running?
    Ms. Greenlee. Thank you, Congresswoman.
    The first thing to understand as we talk about APS is that 
we never created a Federal infrastructure for Adult Protective 
Services. Each Adult Protective Services system was developed 
at the State level, and until we started working on this very 
recently, there was no Federal role at all.
    So what we have focused our attention on is the basics. How 
can we put together a way to gather information from the States 
so we at least have a national snapshot of what an APS case 
looks like, all of the details of the case? So what we have 
been doing with the Assistant Secretary for Planning and 
Evaluation is working with about 30 States to find out how we 
then build an architecture that would interface with the 
existing State programs that are all very different.
    That is what the budget request is for, to be able to then 
take this architecture, which we have now worked on developing, 
and provide grants to States so that they can start to create 
interoperability with the Federal system. So we are really 
starting from scratch, and we have been doing that for the last 
couple of years. But this is completely different than the 
approach that we took for Child Protective Services, where we 
created this sort of infrastructure several decades ago.
    Mrs. Roby. Thank you. I am sorry, Mr. Chairman. I went over 
my time.
    Mr. Cole. I think I went over mine. So that is okay. 
[Laughter.]
    If we could, by order of arrival, Mr. Fattah is next up. 
So----
    Mr. Fattah. Thank you, Mr. Chairman.
    Now let me see if I can, monthly, how many Americans 
receive benefits through the Social Security Administration?
    Ms. Colvin. Well over 60 million.
    Mr. Fattah. Okay. And this is both in terms of the 
disability side and the income security?
    Ms. Colvin. Yes, sir. We have about 11 million who are 
receiving disability.
    Mr. Fattah. So, and the other 49 million are----
    Ms. Colvin. Retirees and some survivors and children.
    Mr. Fattah. Now the Heritage Foundation did a report a 
little while back about labor market participation and how, 
given the baby boomers, it is becoming lower and lower. When 
you talk in terms of the early intervention on the disability 
side about how to help people stay in the workforce, this 
$50,000,000 is an investment in evidence-based research models?
    Ms. Colvin. That is correct.
    Mr. Fattah. Right. That will be able to--because there has 
been a lot of concern about making sure that we could have as 
many people as possible in the workforce, right? So, and we 
also do not want to be paying out if we do not need to pay out, 
I guess, on disability.
    So the plan, assuming the appropriations, would involve how 
many people and how many models?
    Ms. Colvin. I would need to give you that for the record--
--
    Mr. Fattah. Okay.
    Ms. Colvin [continuing]. Because we are working with HHS 
and their research and evaluation unit. We want to make sure 
that we develop the models correctly, and we also want to make 
sure we have an evaluation component. There are discussions 
going on, but we are not too far down the road yet with that.
    This would be a proposal for 2016, so we are working so we 
would be ready for that.
    [The information follows:]

    The FY 2016 request for $50 million will provide funding for the 
first model, which will be a large scale demonstration to test whether 
employment support and other services can forestall enrollment in SSA's 
disability programs. The demonstration will have a treatment (or study) 
group that receives services and a control group that does not. Based 
on past demonstrations we have run at SSA, the number of individuals in 
the treatment group could total 2,000-5,000 individuals (the final 
number depends on additional technical work to determine sufficient 
sample sizes).
    For FY 2017 through FY 2020, the President's Budget requests an 
additional $350 million that would support at least two other models.

    Mr. Fattah. Okay. And let us just go back to the larger 
group of retirees. So at some point, you know, the baby boomers 
will have all retired, right?
    Ms. Colvin. I hope so. [Laughter.]
    Mr. Fattah. I do, too. But that so at some point in terms 
of your staffing pattern I guess is the question, you know, 
school districts have this problem when they are trying to plan 
for school building usage. You know, like there is going to be 
a wave of kids, and then there is going to be no kids.
    And then, so like as you are hiring up, you said earlier 
that there are a number of people retiring. Will it meet the 
needs as you project the agency forward, you know, say over the 
next 20 years or so?
    Ms. Colvin. Well, we are in process of doing our 10-year 
vision for 2025, and we certainly do not see the numbers going 
away at that point. I mean, you have individuals living longer. 
So you have a longer life expectancy. Even if you have people 
who are going onto disability, many of them rollover to the 
retirement program. They may roll over a little bit later since 
we changed the retirement age to 66.
    I think we have over 50,000 people who are 100 years of age 
or older now. So people are living longer.
    Mr. Fattah. That is good.
    Ms. Colvin. I do not think that we have reached a point 
where we believe that we are going to have more staff than we 
need, and we each year give a projection of what the numbers of 
staff we need to do the workloads that we have. We are a very 
production-oriented agency, and we can tell you how we spend 
your money. Any dollar that you give us is well spent.
    Mr. Fattah. My last question. You know, in a perfect world, 
we want people when they retire to have, you know, private 
pension, some savings, some investments, and Social Security. 
But for many, many Americans, that is not the case. What they 
have is what shows up in the mail or in direct deposit from you 
each month, and that is the totality of what they exist off of.
    Do you have an estimate about the percentage of people in 
which the Social Security retiree benefit is the extent of 
their cash?
    Ms. Colvin. I do have that. I do not think I have it before 
me, but it is a high number.
    Mr. Fattah. If you could supply----
    Ms. Colvin. Maybe my staff can give it to me before we 
leave here. But that is the importance of the Social Security 
program. For the majority of Americans, it is the only source 
of income. I know because I have focused most recently on the 
disability program that, you know, it is an average benefit of 
$1,200 a month. And for about 37 percent of the people, that is 
virtually all they get.
    And for about 61 percent of those on disability, most of 
them rely more significantly on Social Security than any other 
type of income. And before we leave, I can give you the amount, 
the percentage of----
    Mr. Fattah. Or for the record. Thank you very much.
    Ms. Colvin. I can provide it for the record also.
    [The information follows:]

    We have estimates of the percentage of beneficiaries who are 
largely dependent on Social Security:
    Among elderly Social Security beneficiaries, 52 percent of married 
couples and 74 percent of unmarried persons receive 50 percent or more 
of their income from Social Security.
    Among elderly Social Security beneficiaries, 22 percent of married 
couples and about 47 percent of unmarried persons rely on Social 
Security for 90 percent or more of their income.

    Mr. Fattah. And thank you, Mr. Chairman.
    Ms. DeLauro. Mr. Fattah, most of those are women because 
women live longer.
    Mr. Cole. Yes, do not rub it in.
    Mr. Fattah. That is because they live better. [Laughter.]
    Mr. Cole. We will go next to the other gentleman from 
Pennsylvania, Mr. Dent.
    Mr. Dent. Thank you both for joining us this morning. 
Appreciate this opportunity.

                          ASSISTIVE TECHNOLOGY

    My question is for Administrator Greenlee. The transfer of 
the Assistive Technology Act to ACL will bring a nice 
complement to many of your existing programs. As I know you 
understand, assistive technology devices help make it possible 
for people with disabilities and older Americans to live 
independently and participate fully in their communities.
    Can we count on ACL to bring forth your leadership to 
support all the existing assistive technology entities and to 
expand opportunities for alternative financing programs so that 
it is possible for people with disabilities or their families 
throughout the United States to be able to buy the devices that 
they need?
    Ms. Greenlee. Yes, Congressman. We are very pleased to have 
the Assistive Technology program transfer to us. Another huge 
opportunity is that the National Institute for Disability, 
Independent Living, and Rehabilitation Research has also come 
to us, and they have a history of also investing in technology 
that can help people remain independent and be employed.
    So we have two more opportunities as a larger organization 
to work to help people get access to assistive technology.
    Mr. Dent. Thank you.
    And the Rehabilitative Services Administration assigned 
priority points to applicants who competed in the most recent 
funding cycles for alternative financing programs. Congress did 
not assign priority points, but rather stated that the monies 
support alternative financing programs that provide for the 
purchase of assistive technology devices.
    The goal in providing these funds is to allow greater 
access to affordable financing to help people with disabilities 
purchase the specialized technologies needed to live 
independently, you know, to succeed at school and work, and to 
otherwise live active and productive lives. If we in Congress 
can continue to provide designated funding for alternative 
financing programs, how can the Administration support and 
build on these programs?
    Ms. Greenlee. Congressman, of the programs that came to us 
with Assistive Technology, the primary support grants to 
States. The Alternative Financing Program was not requested as 
a part of the Administration's budget. So I would like the 
opportunity to respond later if Congress decides to continue to 
fund that program, it was not part of our budget request.
    Mr. Dent. Okay. I wanted to recognize that some of the 
current alternative financing programs, like the one in my 
State, the Pennsylvania Assistive Technology Foundation, and we 
are very proud of the work they do to help people remain 
independent and in their homes in many cases. They are helping, 
you know, thousands of residents but need our help because they 
are out of Federal funds or very close to it.
    And so, the bottom line is would you set the competition in 
closer alignment to the direction we in Congress provided in 
this matter?
    Ms. Greenlee. I said, Congressman, we did not request 
funding for the Alternative Financing Program. I would be glad 
to follow up and because I have not ever administered the 
program and, did not request funding for the program, would 
want to know what your concerns are so that we could address 
them in the event that Congress decides to make that 
appropriation.
    Mr. Dent. And we would love to have that follow-up dialogue 
with you. Thank you very much.
    And to Administrator Colvin, a number of high-profile 
companies and corporations, as well as Federal agencies, have 
been the target of cyber attacks, resulting in the exposure and 
theft of personal and consumer data in the recent years. What 
kind of security measures are in place to protect Americans' 
personal information used and stored in ``my Social Security'' 
accounts?
    Ms. Colvin. Thank you for that question.
    We have been very fortunate to have a very strong 
cybersecurity program in place. I do not know that I am 
technically proficient in all of the things that we do, but I 
will tell you that we have a review done yearly by an outside 
consultant to make certain that those security activities or 
tools are in place.
    We have been very fortunate that we have not had any 
breaches of that information. We are probably the largest 
holder of data on the American public. We are very careful to 
make sure that we are using best practices, as cited throughout 
the Nation by security experts.
    I would be very happy to provide you a more detailed 
listing of the specific activities that we take on a regular 
basis to ensure the security of the data. One of the biggest 
areas of attempts would be around identity theft when we are 
looking at fraud, and we are always trying to make sure that we 
tell our beneficiaries and the American public they need to 
keep their data safe. So we have to set that example.
    Mr. Dent. Okay, and I see my--right on time. I will yield 
back.
    Mr. Cole. Thank you very much.
    And next, go to the gentlelady from California.
    Ms. Roybal-Allard. Thank you, Mr. Chairman.

                     FAMILY SUPPORT AND CAREGIVING

    Ms. Greenlee, as you know, many cities have repeatedly 
cited family caregivers as the backbone of care of older people 
and adults with disabilities. And having two parents who lived 
into their nineties and were disabled, I have a real 
appreciation of the demands that family caregivers face.
    According to findings from an AARP national survey, almost 
half, about 46 percent of family caregivers performed medical 
or nursing tasks for their loved ones and reported feeling 
stress or worried about making a mistake. More than half 
reported feeling depressed or hopeless, and more than a third 
reported being in poor health. So I am very interested in the 
Administration for Community Living's family caregiver 
programs.
    HRSA recently reorganized their Title VII and VIII 
geriatrics program into a single grant, which will allow for 
training of family caregivers. How will this change work with 
the existing support programs at ACL? What is ACL doing to 
support the shrinking population of family caregivers? And what 
is it doing to build a competent geriatric workforce to meet 
the demand for long-term care?
    Ms. Greenlee. Congresswoman, thank you.
    I share your concern about the incredible burdens and 
stress on family caregivers. I am familiar with the AARP report 
that you cited. So I think it is important that we continue to 
acknowledge this is the backbone of our long-term care system.
    The changes I believe that you referenced were to the 
Geriatric Education Program at HRSA, which is focused on 
providing geriatric training to providers. We have many 
relationships with HRSA, but they are really more at the 
consumer delivery point, like with the community health 
clinics, than the geriatric education centers because we see 
more and more older adults coming to the federally qualified 
health clinics. So I think that is where the best connection is 
with HRSA.
    We don't have specific workforce investment resources at 
ACL. In fact, the Affordable Care Act gave HRSA incredible new 
resources to reach in this particular direction. I believe the 
workforce support that we provide is slightly different, and 
that is that we provide the support for caregivers so 
caregivers can get the training they need, respite they need, 
any other type of emotional support that they need. So that if 
they are in the workforce, they can continue to work and 
provide care for their loved one.
    But the companion piece to that is also reflected in this 
budget, providing more services to the older person who needs 
care, such as adult day. That also helps the caregiver because 
while the older person is in adult day programming, the 
caregiver may need to be able to go to work.
    So I think it is a companion piece, and it is the 
centerpiece really of what we are doing in this country to 
provide long-term care. The tremendous, I always call it a 
burden of love, family caregiving. It is essential.
    Ms. Roybal-Allard. Okay. Following up on that, you know, 
there are definitely cultural differences in family caregiving. 
So what does ACL, many of the programs, what are they doing to 
support the diverse culture and linguistic needs of family 
caregivers?
    Ms. Greenlee. The way the program is administered is we 
distribute the family caregiving money to the States, and the 
States then distribute this to the local Area Agency on Aging. 
For instance, in your part of California, to both the City and 
County of Los Angeles. They then will do an assessment of both 
the needs of the older person and the family caregiver.
    And because the assessment is person specific, it provides 
an opportunity to provide culturally appropriate services, 
regardless of the nature of the family or the family caregiving 
need, and also to access other community resources that are 
important so that you can maintain connections to community for 
both the older person and the family member.
    Ms. Roybal-Allard. Now the President's budget includes a 
new family support initiative that focuses on keeping family 
caregivers in the workforce. Can you talk a little bit about 
the importance of a program like this in ensuring that family 
caregivers can remain in the workforce and are able to retire 
themselves?
    Ms. Greenlee. Are you talking specifically about the 
$15,000,000 request in our particular budget?
    Ms. Roybal-Allard. Yes.
    Ms. Greenlee. This particular family caregiver program 
would allow us to provide grants to States to look at the 
complex needs of family caregivers in all kinds of family 
caregiving situations, including caregivers who are providing 
support for an adult with a disability in their family. There 
currently are no systems in place to provide comprehensive 
training or education to a family on what the resources are 
that they may be able to access in their community to help them 
both stay in the workforce and provide care for an adult child 
with a disability, who often will live with their parents for a 
lifetime.
    Once a person with a disability leaves the educational 
system, the family really does not have any sort of collection 
of community resources. And what we are attempting to do is 
work with States to find a way to create models that really 
give the family a different pathway so they do not have to 
immediately turn to Medicaid and instead can keep the family 
unit together, independently financed, with access to a 
different constellation of community resources to help the 
family know that they can access everything to support the 
person with the disability and the family caregiver.
    Our family caregiver programs really run the life span at 
ACL. They are slightly different, but also very complementary.
    Ms. Roybal-Allard. Okay. Thank you.
    Mr. Cole. Mr. Rigell.
    Mr. Rigell. Thank you, Mr. Chairman.
    And thank you both for being here today. We appreciate your 
testimony. It is helpful and instructive to us. We trust that 
our questions are helpful to you as well.
    Commissioner Colvin, I would like to direct my questions to 
you, at least initially, and draw your attention to SSI and its 
solvency or lack thereof. It would be helpful to me--I am new 
to the committee--but if you could explain, to me at least, 
what your responsibility is for providing recommendations to 
the President and to the others within the administration to 
ensure that it is solvent, and what actions are being taken, if 
any, by the administration in terms of proposals for Congress 
to consider to ensure its solvency?
    Ms. Colvin. Thank you for that question.
    I think you mean the SSDI program.
    Mr. Rigell. That is what I meant.
    Ms. Colvin. Okay.
    Mr. Rigell. And thank you.
    Ms. Colvin. It is scheduled to have its reserves depleted 
in 2016. I am certainly a voice inside the administration to 
talk about what the various proposals would mean, what the 
impact would be on the various constituency groups, and what 
the impact would mean for the trust funds. I think I have an 
active responsibility to provide as much information to the 
administration as I can.
    I think the President's reallocation proposal is designed 
to allow us time to come up with long-term solutions, but the 
reallocation proposal, as you know, proposes to take 0.9 
percentage point from the taxes, moving it from Old-Age 
Survivors Insurance to DI Disability Insurance, which would 
give us solvency until 2033 in both programs. And I think that 
there are a number of long-term solutions that have been placed 
on the table that will require bipartisan support to reach a 
conclusion.
    Mr. Rigell. Have you made a definitive recommendation on 
any of those?
    Ms. Colvin. No. As I said, I think my role is to make sure 
that the consequences of the various proposals are well known 
and that we do the estimates and the analysis, and that is what 
I have been doing.
    Mr. Rigell. Do you think that the reallocation is actually 
a substantive reform? I mean that it solves the underlying 
problem? It seems like it does not to me because it then 
exacerbates the problems that we have got on the other account.
    Ms. Colvin. I think you are accurate. I do not think that 
the reallocation proposal is designed to be a long-term 
solution. But you are talking about 2016, which is next year. I 
think the reallocation proposal is designed to give Congress 
and the administration time to come up with the long-term 
solution----
    Mr. Rigell. Well, I would respectfully submit that, you 
know, the 6-plus years the administration has had in office is 
plenty of time to have done that. And I would say as well that 
to the extent that it is this organization's responsibility 
that we could move a bit faster as well.
    Once someone--let us move on then on the SSDI to look at 
when someone is receiving the benefit. What mechanisms are in 
place to go back and see that if they do not need it anymore, 
of course, that they are moved off of it, which I think is the 
right intent and the intent of the program?
    Ms. Colvin. Yes, and Congress did authorize in our budget 
what we call continuing disability reviews. These are medical 
reviews that we do every 3 years when resources are available 
to determine whether or not that person's medical disability 
continues. About 17 percent of the individuals who receive a 
medical review, I am told, we project will come off of the 
rolls.
    Unfortunately, we have not been funded to be able to do 
them on a regular basis so we had a backlog of about 1.3 
million in FY 2014. Our 2016 budget, as you may know, would 
allow us to do 908,000 of those reviews, and we think that will 
result in about 17 percent of those individuals coming off the 
rolls.
    Mr. Rigell. Okay. You know, when I ask these questions, I 
want to make clear that if a fellow American needs some help, I 
am ready to help. But for those who would take advantage of the 
system, you know, I have a real visceral reaction to that 
because they are really stealing from others. And I know the 
agency is trying to do what it can to ferret out the waste.
    But the sharp increase--and I think if I get my 
nomenclature wrong, I will get it right by the next hearing, 
Mr. Chairman. But anyway, on SSDI, it seemed like there has 
been a sharp increase in the number of applications and things. 
You know, that trend is striking as I have looked at the data.
    So what--and I know this was even brought up in the 
previous Congress, but what is driving that? Because I looked 
at your answer from the previous hearing in the previous 
Congress, and I just was not fully understanding. I was not 
satisfied that we really understood what is driving the demand.
    And I see that my--the light is on, the red light. So I 
will stop at this point. If you could maybe just give a couple 
sentences, the chairman might allow, I do not know. It is up to 
him.
    Ms. Colvin. Well, I do want to emphasize that the increase 
in the rolls was projected. If you look back as far as 1995 
with the trustees reports, our actuary always predicted that 
the rolls would go up as a result of the aging of the baby 
boomers, who would be more prone to disability, and more women 
in the workforce who would be earning on their own record, and 
their disability rate would be comparative to men.
    But I will tell you that the Disability Insurance rate, the 
number of applications that we are receiving is declining, not 
increasing.
    Mr. Rigell. I see.
    Ms. Colvin. And that was projected also.
    Mr. Rigell. Okay. Well, thank you for your answer, and I 
thank the chairman for giving me a little grace there.
    Mr. Cole. Absolutely. If we go next, I think Mr. Harris 
arrived next. So----
    Mr. Harris. But I am just--I am going to be coming back. I 
am going to have to step out for a minute. So I will defer.
    Mr. Cole. Okay, very good. Mr. Fleischmann, you are the 
lucky guy. You are up next.
    Mr. Fleischmann. Yes, sir, and thank you, Mr. Chairman. And 
I apologize for my delay. I was at another subcommittee hearing 
for the Secretary of Energy.
    Ladies, good morning, and thank you for being here.
    Commissioner Colvin, thank you for updating us on the 
excellent work SSA is doing to increase accessibility through 
online services. Social Security employees from my district who 
assist my constituents every day have expressed concerns to me 
about the security of users' data in ``my Social Security''--
and I put that in quotes--online accounts.
    Their concerns center on the Administration contracting 
with a company that has sold personal data to a Vietnamese ID 
theft operation, but they do have broader concerns about the 
security of iClaims and SSA's online operations in general. I 
would like to follow up on Mr. Dent's questions on 
cybersecurity.
    Could you please outline specific steps that you are taking 
to guarantee personal information entered into SSA Web sites is 
not at risk of being sold or made susceptible to security 
breaches? That is one question.
    What recommendations from the OIG have you implemented, and 
what recommendations are you still working on? And have any 
investigations been launched into the company or companies you 
contract with to determine how safe users' information is in 
their possession?
    Ms. Colvin. Mr. Fleischmann, I am going to ask that you 
allow me to provide that answer for you on the record. I will 
tell you that our information is very secure, that we work with 
outside experts to ensure, as I mentioned earlier, that we are 
using best practices.
    I am not aware of any major breaches in the personal 
information that we use or that we secure. And so, I would like 
to give you a very detailed response for the record.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    
    Ms. Colvin. There are also some steps that we take that I 
do not think we want to be made public because fraudsters are 
always looking at how they can defraud the system. We would be 
very happy to brief your staff on what we are doing in those 
areas.
    Mr. Fleischmann. Okay. Thank you. I will look forward to 
receiving that.
    Commissioner, as you have stated, SSA has a lot of work to 
do to continue to reduce waste, fraud, and abuse in Social 
Security. Your application process and investigations play an 
extremely important role in cutting wasteful and fraudulent 
spending that threatens our national fiscal sustainability.
    I am interested in finding out what additional steps can be 
taken to help these efforts. It is my understanding that your 
processes do not currently involve reviewing unemployment 
compensation records to determine if disability insurance 
applicants who, by definition, cannot work and are receiving 
unemployment compensation, which requires that they are able to 
work and are actively seeking employment.
    Has SSA ever considered including this step? Are there 
barriers in place that would keep you from being able to 
implement this type of review?
    Ms. Colvin. Let me answer the last part of your question. 
The President's budget does have a proposal that would offset 
any income that is received from unemployment against 
disability. I think that was your question. So there is a 
proposal in the 2016 budget for that.
    I also want to stress, though, that fraud is very small in 
our program. The Inspector General's Office has identified that 
it is less than 1 percent, although even one case is too many, 
and we have a lot of fraud initiatives. We have established an 
Office of Anti-Fraud Prevention so that we could make sure that 
it was highly focused.
    Our cooperative disability investigative (CDI) units are a 
partnership with Office of Inspector General, the first one was 
established in 1998 when I was here as the Deputy for 
Operations. We now have 28. We will be opening another four in 
2015, and another five in 2016 if we get the budget.
    So these are the ones that we think are especially 
important because they prevent a check from going out, where 
many of the other initiatives we have are going after the money 
once it has been paid out. This is a cooperative initiative 
with the local disability determination services at the State 
level.
    They identify suspicious cases or where the information 
does not seem credible, and that is referred to the CDI unit 
that does an investigation. We are often able to intercept a 
payment there.
    We also have a national anti-fraud committee that works 
with the 10 regions, and they review the cases that have been 
identified for lessons learned. They also look at policy 
changes that may be necessary or anything that would help 
prevent a case from occurring again.
    We are really doing a lot now with disability analytics, 
analyzing information so we can see trends. This allows us to 
identify third-party facilitators, doctors or lawyers who may 
be in collusion to receive a benefit for their client they 
should not get. And we have been having a lot of success there.
    We have mandatory training for all 62,000 of our employees 
on fraud so they know how to detect it. SSA just recently 
implemented new notice language so that all of our notices now 
have a statement urging individuals to report any suspicious 
fraud, and we give them our hotline as a reminder.
    And then we are doing a number of things with eServices 
fraud, which I would prefer to report to you privately so that 
fraudsters will not have that information.
    I think we are doing a lot. One of the things that I would 
ask Congress to do is pass legislation that would allow us to 
impose penalties against third-party fraudsters, where many 
times a court will not accept our cases because they do not 
come up to the dollar value that they want, and we then are not 
able to prosecute.
    But if I had certain authorities, we could at least go 
after individuals civilly. We do have a legislative proposal in 
the budget, and we hope you will consider that.
    Mr. Fleischmann. Thank you very much. Mr. Chairman, I yield 
back.
    Mr. Cole. Thank you. And I just for the record want to 
commend your fraud effort in terms of what I have seen 
personally, actually before I was on this subcommittee, in your 
Oklahoma City office. It is absolutely eye-opening, and I share 
Mr. Rigell's righteous indignation here when----
    Ms. Colvin. Absolutely.
    Mr. Cole [continuing]. We are talking about taking people's 
retirements and taking money that is set aside for people that 
have genuine disabilities and real need. So thank you for your 
efforts in that way.

                        NATIVE AMERICAN PROGRAMS

    Administrator Greenlee, if I could go to you for a moment, 
I have got always a tremendous interest in what is happening 
with Native Americans and with tribal governments, and I know 
you have got some initiatives underway to try and help some of 
the both elderly and disabled in those communities, which are 
quite often isolated and in many cases have very limited 
resources of their own.
    So, number one, could you describe the relationship you 
have with tribal governments, which vary in capacity and, 
frankly, what they can do? And two, could you then go through 
some of the specific things, I noticed you have asked for a 
modest increase in nutrition and caretaker services for Native 
Americans in particular. So what are the sorts of efforts that 
you are doing to reach out and build those relationships and 
reach those very difficult to serve populations?
    Ms. Greenlee. Thank you, Mr. Chairman.
    Yes, through the Older Americans Act, we have specific 
dedicated funding where we fund tribes directly for both 
nutrition services and caregiver services. Any time we make a 
request for an increase in the budget for the other Older 
Americans Act funds for nutrition and caregiver, we always try 
to make the same request for the tribal programs that we have.
    For the whole time I have been here, I have conducted a 
listening session with our tribal grantees. For about the last 
3 years, I have done that with Dr. Roubideaux, the head of 
Indian Health Services, and they are always sobering when you 
talk to the tribes.
    I actually did a listening session in Oklahoma with the 
Oklahoma Indian Council about 3 or 4 years ago, and it is they 
always come back and talk about multiple things--the poverty 
that many tribes face, the role of the family is always 
paramount when we talk to tribes, the way they really have to 
stretch the dollars that we give them, and that anything that 
we can do to support the whole family helps the elders, as well 
as helping the elders directly through our Title VI grantees.
    Elder abuse is a major passion of mine in terms of working 
on these issues. For the last several years, elder abuse has 
come out from tribes as one of their primary concerns. When we 
talk elder abuse, we find the same jurisdictional issues that 
you would have with Adult Protective Services and law 
enforcement with regard to the ability of tribes to deal with 
abuse on tribal lands.
    We specifically have funded a national elder Indian--
national elder indigenous project to work specifically on elder 
abuse with the American Indians so that we can be culturally 
competent as we work with tribes. It is really rewarding and 
sometimes heartbreaking work because of the amount of poverty 
the tribes have.
    I think the thing that is most uplifting is really to see 
the value of the family and the way that in tribal communities 
the elder is not left behind in any way and that there is a 
real attention to those services. So anything that we can do to 
help tribes in that way we do.
    There are also other funding opportunities. When we have 
general program announcements for any other programs, the 
tribes are also completely welcome to apply. So it is not just 
as specific as dedicated funding, but other opportunities as 
well. It is important work.
    Mr. Cole. Well, thank you very much.
    You know, one of the challenges for this particular 
population, too, is Native Americans are no longer living on 
tribal lands. And you know, in the healthcare system, we have 
38 different facilities in communities with high Native 
American populations, but where most of that population is 
apart from the area of jurisdiction or the reservation, which 
is home.
    Do you have any particular outreach efforts to those folks? 
And again, this is a population particularly in the disability 
area that has a unique--you know, will be much more likely to 
have diabetes, much more likely to have certain kinds of 
illnesses that they are genetically predisposed to have and, 
frankly, have quite often had a lot less in the way of care and 
services over the course of a lifetime that sort of help you, 
sustain you when you are a little bit older.
    Ms. Greenlee. It is an expectation that we have of both the 
State and the local Area Agency on Aging that they provide 
services to all older people in their communities. So for urban 
Indians who are living in a catchment area and an Area Agency 
on Aging that is not on a reservation or specific tribal land, 
we really fund them to do that work directly and find it is 
important that we continue to fund national resource centers 
who can work with States and Area Agencies on Aging to make 
sure that they provide specific information to tribes.
    It is not just the responsibility of the tribes themselves 
because, as you say, not everyone is living on specific tribal 
land. It is everyone's group responsibility to serve all the 
diverse communities in an urban population, including American 
Indians.
    Mr. Cole. Well, I commend you for your work in this regard 
and particularly am pleased to hear that you are working with 
Dr. Roubideaux. Because I do think those 38 healthcare centers 
may be an awfully good place for you to focus on as well 
because, again, that is where a lot of that population is going 
to come to in an urban setting.
    And there is no doubt there is an opportunity there for 
cross services, obviously for medical services, but for some of 
these assisted living programs as well. So just thank you for 
looking at it.
    Mr. Harris has not yet returned. So if I can, I will go to 
the gentlelady from Connecticut.
    Ms. DeLauro. Thank you, Mr. Chairman.
    And Ms. Greenlee, thank you for your focus on elder abuse. 
I think it is an area that has--really needs a lot of 
attention, and I do not know the various ways in which we have 
the opportunity to monitor what is happening. And you know, I 
have a mother who is 101 years old, and she lives with me and 
my husband in New Haven, and we have caregivers, you know, 
around the clock. And I know how well they treat her.
    And we are all people who would go to various facilities 
and nursing homes, et cetera, and you hope that people are 
being cared for in the right way. But I think your attention to 
this issue is critical, and we need to really uncover those 
places and take them really more than to task, you know? Put 
them out of business, I swear, if they are abusing elderly, 
elderly people.

                               NUTRITION

    And I want to focus and I want to move to senior 
nutrition----
    Ms. Greenlee. Yes.
    Ms. DeLauro [continuing]. If I can because I think that is 
another area of real serious concern. You have asked in the 
budget for $60,000,000 to increase nutrition programs. And 
there has been a decline, as I understand it, in those services 
over the past 5 years. At this level, you can provide more than 
200 million meals to more than 2 million seniors, most of whom 
are lower income.
    My understanding is that more than 9 million Americans over 
the age of 60 face the threat of hunger. Is that number barely 
scratching the surface of what the problem is out there in the 
hunger issue? What other ways could we assist in trying to 
provide healthy and nutritious meals for seniors?
    And in your experience, is a lack of nutritious meals a 
common reason that seniors need to move into assisted living 
facilities?
    Ms. Greenlee. May I start with your last question first?
    Ms. DeLauro. Sure.
    Ms. Greenlee. Every year, we do a survey of people who have 
participated in Older Americans Act programs, and we ask that 
question specifically, if people had not been able to receive 
the meals, would they have been more likely to need to move to 
an institutional setting? And that is always the information 
that we get back, that the meals themselves help people remain 
independent.
    In fact, that is often the first service that someone will 
call for, either the older adult or a family member. That 
certainly was the case in my own family, where we called for 
meals. And when the Area Agency did an assessment, they often 
find that someone needs additional kinds of supports.
    The budget request for additional nutrition funding is 
broken into two pieces. One to provide basic additional funding 
to the States through the formula grants that we have for home-
delivered and congregate meals to stem the tide. We have been 
losing progress in the last several years and have been able to 
serve fewer and fewer people just because of inflation.
    So the trend is this way because of inflation. If you 
looked at that trend overlaid with the increased number of 
older people, the trend line would be stark in terms of the 
percentage of people that we are able to reach being far less, 
compared to the older population as a whole.
    Ms. DeLauro. And that includes the Meals on Wheels program?
    Ms. Greenlee. Yes. Yes.
    Ms. DeLauro. Yes.
    Ms. Greenlee. And so, all home-delivered, all congregate 
meals would benefit.
    We also are very interested in innovation. I do not have 
any innovation dollars for the nutrition program. They all go 
out by formulas and go to the States. So $20,000,000 of the 
$60,000,000 increase is to look at how we could modernize the 
system, look at the ongoing demand, as we have more older 
people come because of the age wave, and figure out if there is 
different types of service deliveries----
    Ms. DeLauro. Do you have any thoughts on how to--
innovations?
    Ms. Greenlee. We can look at the ability to use technology 
to order meals or to alert people if someone is not going to be 
home. We can try different kinds of food service. Salad bars 
are very popular. Can we adequately provide the daily 
nutritional allowance if someone is choosing more meals? And 
how can we change the service system itself?
    Ms. DeLauro. I have taken the opportunity on several 
occasions to go with the people who deliver the Meals on Wheels 
just to ride along and then go into folks' homes. And in so 
many instances, I have found that they are people who are 
homebound, and they may or may not have a relative close by. Or 
even some had relatives out of State.
    And that person who does go not only delivers a meal, but 
also checks in to see if the person well, if they have other 
concerns and issues. So that the extent to which we can 
increase that opportunity because in some instances, it is the 
only meal that folks get for a day. If they are homebound and 
they cannot get around and so forth, that is what their level 
of food is for a day.
    I would like to work with you on the issue of hunger, which 
is an issue that is very, very important to me----
    Ms. Greenlee. Thank you.
    Ms. DeLauro [continuing]. Both for seniors and others as 
well.
    Ms. Greenlee. Thank you for your interest.
    Ms. DeLauro. And on tribal lands, I might add, Mr. 
Chairman, a big issue on tribal lands is hunger.
    Mr. Cole. It is, and as my friend knows, it is not just the 
sustenance. It is the social contact and the interaction that 
you get when you are actually with a group. That support makes 
a lot of difference for a lot of people.
    Actually, Mr. Dent was going to be next. But---- 
[Laughter.]
    So I think Mr. Fattah is now next.
    Mr. Fattah. Thank you, Mr. Chairman.

                  ALZHEIMER'S AND OTHER BRAIN DISEASES

    I am very interested in brain health-related issues. So you 
indicated earlier that over 70 million people will be over the 
age of 60. Degenerative brain diseases, dementia, you know, 
Alzheimer's, Parkinson's, Huntingdon's disease, I am interested 
in what you, given your footprint, what you sense about--you 
know, the NIH, which is also under our jurisdiction, says there 
are over 15 million Americans suffering from some one of 
hundreds of brain illnesses or diseases.
    But this population, both on the disability side that you 
interact with, and the elderly, you know, the most you are 
actually touching these people in real ways each day. So I 
would be interested in what you think is happening about 
caregiving for those who have a neurological-based illness?
    Ms. Greenlee. I am glad you started by mentioning NIH. We 
have a close partnership with the National Institute on Aging, 
which has a history of specific investments in Alzheimer's 
related research. And it is a nice complement where we can 
invest in long-lead research to help look for ways to slow the 
disease or maybe get rid of the disease.
    And then there are the programs that we have that help 
provide support for people who are living with Alzheimer's and 
related dementias and their family caregivers. So we have 
specific programs that are designed with an evidence base for 
Alzheimer's disease to help support people. We have systems in 
place to help States redesign their long-term services system 
so they are capable of understanding the unique needs of this 
population.
    With our broader mission as ACL, we have been able to 
provide additional focus since people with Down syndrome as 
they age are at incredible risk for having a diagnosis of 
Alzheimer's disease. We have done an awareness campaign to 
reach out to individuals, and our base family caregiver program 
also has a lot of support for people with Alzheimer's disease.
    Mr. Fattah. Well, I would be very interested in getting as 
much detail as is possible about those activities, and the 
other things you talked about earlier is when you have younger 
people who are disabled and who age out of the education 
system. So autistic kids or kids who are in the spectrum, once 
they age out, they are in a situation where, you know, there 
are challenges for families.
    And I would be interested in whether you have any 
interaction at that level?
    Ms. Greenlee. Yes, and the challenges for families are 
similar to what Congresswoman Roybal-Allard was talking about 
when she asked me about family caregiving. How can we find a 
way to build an entire community around the family to provide 
support for family and provide support for the young adult or 
middle-aged adult with the disability?
    That family will age together, and the caregiving 
experience for families can often then last for a lifetime. 
This becomes very stark when the issues all converge, and you 
have really old people caring for middle-aged people with 
disabilities and really needing to do some planning for the 
future. So how do we take a comprehensive look at what it looks 
like to have community supports in place and not assume that 
everything is going to be a Medicaid payment?
    Mr. Fattah. Well, we should work together. I look forward 
to having opportunities to follow up with you on this after. We 
could get some information about your various programs, all 
right?
    Ms. Greenlee. Sure.
    Mr. Fattah. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    We have not given you much time, Dr. Harris, but if you are 
ready, you are up next.
    Mr. Harris. Thank you very much. Thank you, Mr. Chairman.

                     SHELTERED WORKSHOPS: CMS RULE

    I have one just quick question, and it is just out of 
curiosity. I do not know if you know, but CMS issued a rule 
last year that would in effect eliminate the use of Medicaid 
funding at the State level for sheltered workshops. These 
workshops, which I have in my district, provide jobs for people 
who likely would not otherwise be able to work. It allows them 
to socialize with other individuals similar to them and the 
community more broadly.
    Again, this is an important issue for the disabled in my 
district. I just want to ask, were you, as one of the lead 
departments that actually does work with the disabled, were you 
consulted by CMS prior to the rule being issued?
    Ms. Greenlee. Yes, sir. We were. We worked with CMS as they 
worked on developing that.
    Mr. Harris. And do you agree with that rule? You think they 
really should remove the funding from these sheltered 
workshops?
    Ms. Greenlee. The purpose of the rule and our participation 
as they were developing the rule is to look at evaluating the 
experience of a person who is receiving Medicaid funding so 
that they have an integrated community-based experience. And 
that is really the goal of the rule. It is not specifically 
directed at sheltered workshops, but at how someone completes 
community integration.
    Mr. Harris. Okay.
    Ms. Greenlee. And then the States are given both a 
challenge to make those assessments and time to make changes to 
their systems. So it is still primarily a Medicaid 
conversation, but we were involved in the conversation.
    Mr. Harris. Okay. All I can tell you is the sheltered 
workshops in my districts are worried about it. I mean, you 
know, I think they do a great job for the communities, and I am 
a little concerned that they came up with that.
    Anyway, look, my other question is while I am glad to see 
that SSA is extending the field office hours by 1 hour 4 days a 
week, the wait time for an appointment at a field office is 
still unacceptably long. If the majority of the public were 
able to go online for SSA basic services, the local office 
staff could focus on serving those who are unable to access 
online services or whose needs are more complex, many of whom 
are in the disabled and aging communities.
    Now I know that SSA has recently taken steps to make some 
of its services available online. While the availability of 
information is crucial to the public, the accessibility of the 
majority of SSA services is what will really drive the public's 
use of your Web site.
    So with the $664,000,000 increase requested for LAE, could 
you outline SSA's plan for fiscal year 2016 to better exploit 
technology to make greater service automation for the public 
possible? And a related question, to what degree do you make 
public announcements about the availability of SSA's online 
services so as to encourage wider use?
    Ms. Colvin. Thank you, Dr. Harris.
    We are very pleased with the progress that we have made 
with online services. Today, about 50 percent of our claims 
are, in fact, taken online, both retirement and disability. We 
also have our earnings statement now online.
    We also have a ``my Social Security'' account for 
individuals working and paying into the system. They do not 
have to be retired to go online and get information about their 
benefit. They can change their address or other types of 
information.
    In 2015 and 2016, we are going to be increasing additional 
services online. We are going to be putting a Social Security 
replacement card online. We have to do that carefully. I heard 
some of your colleagues' concern about security. So we have to 
make sure that security is in place.
    We already have put the 1099 online so that individuals can 
get that information to do their financial planning. We are 
also increasing a number of the other types of services that we 
will have available both for the customer, as well as improving 
some of the systems inside that will make it easier.
    We do see that this will help us to reduce the traffic into 
the field offices. We recognize that not all of the American 
public feel comfortable online, and some of them really need 
personal service. So what we hope is that as we are able to 
move more traffic out of the field offices onto online 
services, that will then give the people in the field the 
opportunity to serve people more rapidly and give them a little 
bit more personal attention, which we are not able to do now 
simply because of the shortage of staff.
    Our 2015 appropriation, and we are so appreciative of that, 
has allowed us to hire people, but it is going to take us time 
to train them. It takes us about a year to get them proficient 
to be able to do work on their own, and so we are hopeful that 
2016 will allow us to continue to do those things that I just 
talked about.
    Mr. Harris. Well, what about the service kiosk pilot? Do 
you think that will be successful?
    Ms. Colvin. Well, we certainly hope so. We are piloting it. 
We are getting good reviews so far. I am hoping we can get 
something in the district so that some of your staff can come 
out and take a look at it.
    We have found that the videoconferencing, particularly in 
the remote areas, where we still want to do face-to-face, there 
was some initial apprehension. But I said to the constituents, 
``Do you watch TV? It is just like that, except that the person 
in the screen talks back to you.'' There has been great 
satisfaction with the videoconferencing.
    With the pilot that you are talking about, this will allow 
a little bit more self-servicing, and we have seven that we 
have placed in various areas to test that out. We are very 
excited. So we thank you.
    Mr. Harris. Thank you very much. And good to see you again.
    Thank you, Mr. Chairman. I yield back.
    Ms. Colvin. Thank you.
    Mr. Cole. Thank you.
    My good friend from California is next up.

              ELDER JUSTICE AND ADULT PROTECTIVE SERVICES

    Ms. Roybal-Allard. Ms. Greenlee, I want to go back to the 
issue of elder abuse. During your tenure as the Assistant 
Secretary for Aging, in 2010, the Elder Justice Act authorized 
the Elder Justice Coordinating Council, and the Advisory Board 
on Elder Abuse, Neglect, and Exploitation. And the former 
Secretary of HHS solicited nominations for 27 appointments to 
the advisory board.
    And then since the creation of ACL in 2012, the Elder 
Justice Coordinating Council fell under its purview, but we 
have not seen any additional information with respect to the 
membership appointments for the activities of the advisory 
board. What is the current status of the advisory council 
appointments and activities, and also if you could just 
describe a little bit more about the Elder Coordinating 
Council's current initiatives to improve prevention and 
awareness of elder abuse and whether or not your proposed 
budget will be sufficient enough to carry out these objectives 
in fiscal year 2016?
    Ms. Greenlee. Congresswoman, as you pointed out, the Elder 
Justice Act created two formal bodies. One would have been a 
Federal advisory committee, the one you mentioned that had 27 
members.
    When the law was passed as a part of the Affordable Care 
Act, it received no appropriation. We did put out a Federal 
Register Notice, hoping to be able to stand up that advisory 
council, but because there was no appropriation to help staff 
or provide support for the advisory committee, we were not able 
to move forward on that.
    The second body was the Federal Coordinating Council, and 
this is where Carolyn Colvin and I spend a lot of time 
together, where there is a large group of about 12 Federal 
agencies that have met to talk about what we can do 
comprehensively to deal with both prevention and response. 
Because we have not had this external advisory committee, we 
have conducted those meetings with the public in mind, have had 
many of those same experts who were nominated provide testimony 
to us directly.
    We came up with a short list of eight recommendations on 
what we can do, from awareness to prosecution, and have really 
given the charge back to each of the individual agencies for 
them to lift whichever pieces they can lift.
    And I think the best kind of example right now is not just 
the work that we are doing at HHS, but the Department of 
Justice has been an essential colleague in this. Justice 
announced a national online resource for prosecution of elder 
abuse that would be available to all State and Federal 
prosecutors around the country.
    So it is really each of us who have been taking up the 
responsibility to go back to our agencies and do what we can 
do. My piece is reflected here in this budget, which is how can 
we help with Adult Protective Services and some research 
dollars?
    Ms. Roybal-Allard. Thank you.
    Commissioner Colvin, I understand that the Social Security 
Administration is drafting a long-term strategic plan that has 
yet to be finalized. But a draft report was circulated that 
indicates that by 2025, the SSA hopes to provide direct service 
options only in very limited circumstances, preferring to focus 
as much as possible on online service.
    And then, recently, the New York Times reported that 20 
percent of adults do not use the Internet, and only slightly 
more than 50 percent of Americans 65 and older use it. Is the 
strategic plan in the best interests of the American people?
    And also earlier you mentioned that your field offices 
always will be the primary form of service delivery. So how do 
you reconcile the draft report with your earlier statement?
    Ms. Colvin. Thank you so much for that question. It allows 
me to clarify the report that is out.
    The report you are referencing is a report that was done by 
NAPA, which this body asked for. The report has been released, 
and we will use it to inform our plan that will be coming out 
shortly. But that report does not reflect the vision for the 
agency.
    I believe it goes too far. I think that certainly at some 
point, you will see more and more online services, but 
certainly not by 2025. So we are going to use the information 
and the research and some of the other information that was 
contained in that report to inform our decisions.
    We also reached out to a much wider stakeholder group so we 
could ensure that we were hearing from everyone. It has taken 
me a little bit longer than I anticipated to finalize that, but 
we expect that to be coming out in the near term.
    Our report will reflect in there that we do expect that our 
field offices will be a basic foundation, and that we also will 
be increasing our online services. We believe that we have to 
look at customer choice because our services are paid for by 
the individuals who pay into the FICA system, and so we do need 
to at least listen to what they want.
    We do find more and more people are willing to use online 
services if they are easy and convenient, and so we want to 
certainly tap into that. But we recognize that there will 
always be a population that prefers to do face-to-face and in 
some instances really need it. We serve the SSI population, the 
homeless, the mentally ill, and other individuals who will 
always need assistance.
    Ms. Roybal-Allard. Okay, thank you.
    Mr. Cole. Thank you.
    My good friend from Arkansas, Mr. Womack, has been in 
Defense. That is why he has not been here. So he has been 
taking care of all of us, but certainly covering for me not 
being there. So----
    Mr. Womack. I apologize for being late to the meeting, and 
I have had an earful from the Chief of Naval Operations and the 
Marine Corps Commandant.
    So, Administrator Greenlee, in your testimony, you say that 
you ``know that people enjoy a better quality of life when they 
are able to live in a home of their choosing with people they 
love rather than in an institutional setting'' and that keeping 
the developmentally disabled in their homes is ``clearly the 
right thing to do.''
    I agree with you that that is true for most individuals. 
But I find it extremely concerning that you have made such a 
definitive, all-encompassing statement because it is certainly 
not true for all individuals, and I want to use John Sherman as 
an example.
    John is 46, but due to suffering severe brain injury at 
birth, has less cognitive ability than my 20-month-old 
grandson, Kaden. John is profoundly disabled. His mother, 
Carol, is in her seventies. She is also half his size and 
cannot provide the level of care necessary to care for John, 
much less provide him with better care.
    So she had to make the tough decision to give John a new 
home at the Arkadelphia, Arkansas, human development center, a 
Medicaid-certified intermediate care facility. It was clearly 
the right thing to do for John.

                        PROTECTION AND ADVOCACY

    As the Administrator for ACL, you oversee the 
Administration on Intellectual and Developmental Disabilities, 
which provides Federal funding to grantees in each State to 
carry out its protection and advocacy program. In Arkansas, our 
program has in the past brought multiple Federal lawsuits 
against our State using as named plaintiffs residents of long-
term care facilities without notice of their legal guardian, to 
their legal guardians.
    They have also released a report in January of this year 
calling for the closure of one of our State's human development 
centers. So I have a couple of questions in the context of this 
discussion.
    Is it the policy of your agency to endorse activities of 
lobbying, the threat of litigation, and Federal lawsuits by 
protection and advocacy programs for the purpose of undermining 
and closing long-term care facilities?
    Ms. Greenlee. So, Mr. Chairman, the program you have 
correctly cited, the Protection and Advocacy agencies are part 
of the Administration for Intellectual and Developmental 
Disabilities. Their primary purposes are to advocate on behalf 
of individuals with disabilities, especially looking for people 
who are at risk for abuse or have been abused. And they also 
have been charged with or taken up the responsibility to 
enforce the Supreme Court decision with regard to the Olmstead 
case to make sure that people are served in the least 
restrictive setting.
    I obviously cannot comment on any specific litigation that 
you are talking about, but that is their mission, to make sure 
that people are not abused and that they are in the least 
restrictive setting.
    Mr. Womack. So you are not going on any witch hunts?
    Ms. Greenlee. No.
    Mr. Womack. Okay. Are you aware that grantees are 
restricted from using Federal funds to attempt to influence 
deliberations or actions by Federal, State, or local 
legislative or executive branches?
    Ms. Greenlee. What are you talking about specifically? I am 
sorry. I do not understand.
    Mr. Womack. It is plain English. Grantees are restricted 
from using Federal funds to attempt to influence deliberations. 
So is that your understanding?
    Ms. Greenlee. Yes, and if we are still talking about 
Protection and Advocacy agencies, they are charged by statute 
with this advocacy responsibility and litigation responsibility 
that you have just outlined, not with the legislative activity 
that you are asking me about.
    Mr. Womack. Are there fine lines between undue influence 
using the Federal purse, the Federal connections there as an 
influential technique?
    Ms. Greenlee. Sir, I am not quite sure how to be the most 
responsive to you. They are charged with the responsibility of 
being advocates. So perhaps there are concerns that you have 
that they have gone too far. I do not know without having a 
specific situation.
    But advocacy is a statutory responsibility of many of the 
programs that I run, and that is to bring forward the issues on 
behalf of the American people. That is not to lobby or talk 
about a specific piece of legislation, but to talk generally 
about the issues in front of them.
    That is different than lobbying. It is about providing 
basic education about the people they are serving.
    Mr. Womack. Okay. Finally, Ms. Greenlee, what are ways in 
which your agency supports the option of long-term care 
facilities for persons who cannot care for themselves, like the 
example that I gave in my opening remarks?
    Ms. Greenlee. Like you said in your opening remarks, the 
person that made this decision made a decision on behalf of 
their family, and this was a Medicaid-funded program. This is 
not an agency or a program that we administer at ACL.
    We do believe in the statement that I said, that you quoted 
from our record, that most people want to live at home. And 
what we have found to be true is that we have become 
extraordinarily good in this country at serving people with 
significant disabilities in a home setting, and we continue to 
improve our ability to do that over time.
    We think that is the right policy decision that we should 
continue to explore every option so that people can have their 
family members with them. If any family member chooses to go in 
a different direction, that is their particular choice as a 
family and is a decision with Medicaid. But for us, we want to 
continue to explore every option to make sure that people can 
stay in community.
    Mr. Womack. So, and finally, I will leave it with this. Is 
it your goal to eventually, I hate to say eliminate long-term 
care facilities like the one I have spoken about, but is it 
your goal to see that the home setting is going to be the 
answer to the future needs of this population group, or do you 
see a place out there for these long-term care facilities into 
the distant future?
    Ms. Greenlee. Our goal is to see that the home setting is 
the primary venue for all the populations that we serve and 
that we continue to provide every support that we can to make 
that a reality.
    We have no mechanism to require that any other setting 
change or close, but we will drive policy and work with 
families and older people and people with disabilities to 
explore everything we can do as a country to provide 
integration in the home setting because it has clearly been 
represented to us by older people and people with disabilities 
that this gives them the best quality of life and the most 
integration.
    We are not a facility closure agency. They are not the 
facilities that we run.
    Mr. Womack. Yes, I understand that. I just--my parting shot 
is I just think that you cannot have a ``one size fits all'' 
approach going into the future.
    With that, Mr. Chairman, I yield back.
    Mr. Cole. Thank you very much.
    Commissioner Colvin, we have talked a little bit about some 
of the efforts you have made in both in the fraud area, but I 
would like you to elaborate a little bit more on that because I 
think, again, it is something we are all very sensitive on. So 
what are the specific things you are doing on fraud?
    And the other place I would ask you to focus some attention 
and bring us up to date on what you are doing is obviously 
sometimes mistakes are made, and we either overpay or underpay. 
It is usually a disaster when you overpay and you find it. You 
have to go back and get the money. It is hard to do. The person 
that received sometimes is totally innocent but obviously has 
spent the funds and does not have very much.
    Ms. Colvin. Right.
    Mr. Cole. So what are we doing to lower our error rate, 
which I understand is like 10 percent in over or underpayment?
    Ms. Colvin. Thank you for that question.
    Mr. Cole. I want you to correct me because I would like to 
be wrong.
    Ms. Colvin. Right. Well, overpayment and underpayment are 
two areas that are especially important to me, and I focus on 
them a lot. I believe that we have an obligation to make 
certain that we recover overpayments for the taxpayers.
    We do know that in some instances the overpayment can be 
the result of a mistake that we made, or it could be because 
our workload is heavy and we do not get to it on time. So 
Congress recognized that, and there is a waiver process.
    Individuals have the ability to prove that the overpayment 
was through no fault of their own or that they do not have the 
ability to pay because they just have basic income that allows 
them to survive. So we do that. But once it is determined that 
the individual has the ability to pay and it was their fault, 
we do aggressively pursue that.
    I am particularly concerned about underpayments because the 
benefit payment is low, and we have a very complex program. So 
we do have situations where people are underpaid because they 
do not always give us all the information, and we find out 
later. It happens particularly with the widows and individuals 
like that.
    We have workgroups within our agency who are focusing on 
those error-prone areas. But the accuracy rate for Title II is 
99.7 percent. The accuracy rate for Title XVI is not as high 
because that is our more complex program, and it is our means-
tested programs. But that is still 90.7. I have been able to 
get that up 1 percent in the time I have been here, and we are 
constantly looking at ways to do that.
    The biggest area where we have the problem is with wages 
that are not reported, and we have had various proposals where 
we would get quarterly instead of yearly reporting from IRS. We 
have not been able to get that through yet.
    But we have a program that we call Access to Financial 
Institutions where we are able to work with the banks and 
identify any assets that are not reported. That has been 
extremely successful. And so, we check up to 10 banks in an 
area to see if individuals have accounts that they have not 
reported. That is just a data match, and that has been very 
successful.
    We also now have the ability to have individuals report 
their wages by mobile application or telephone application, and 
the number of people who are reporting has significantly 
increased. So we believe the easier we make it for people to 
report their wages, the more people will report.
    But in the fraud area, I want to emphasize again that it is 
a very complex program. We pay out almost $1,000,000,000,000 a 
year, $940,000,000,000 this year. But we are projecting by the 
end of 2016 almost $1,000,000,000,000. And so, we know the 
fraudsters are going to go where the money is.
    So we began to use data analytics to identify the trends 
that I talked about. You have many stories about doctors and 
lawyers who fabricate information and work together to try to 
defraud the program. We are being very aggressive in going 
after those kinds of cases.
    One of our biggest challenges is that the prosecution is 
not sufficient. Our cases just are not accepted by the local 
States. We had when I came back----
    Mr. Cole. Can I ask you on that just a specific question? I 
do not mean to interrupt. I apologize.
    Ms. Colvin. That is all right.
    Mr. Cole. It is just so you can incorporate in your answer. 
You know, I am particularly interested, look, when you have got 
a scheme, as opposed to a person chiseling the system is bad, 
but it is one person. But when you have got a scheme and you 
have got literally dozens of people involved in these sorts of 
things and quite often very, you know, ``high-class 
professionals''--doctors, attorneys, as you mentioned. Do they 
ever get any prison time for this?
    I mean, is this just white collar crime and a fine, or do 
they go to jail?
    Ms. Colvin. Some get prison time, but the penalty is not 
where I think it needs to be. But we do not control that. It 
depends upon the court where they are being tried.
    Some of the dollars are significant. Some people get jail 
time. Some get restitution. But we try to push for the maximum 
penalty.
    Where you have the third-party fraudsters, as I mentioned, 
we are proposing legislation that penalties will be increased 
in those areas. With the smaller crime, though, where you have 
someone who got their mother's benefit for 15 years, and they 
took $500,000 that they should not have received, I think they 
should go to jail regardless of their age.
    The court does not seem to think the same thing, so they 
might get home detention, or they might get restitution. We 
have to accept that, but we feel that there has to be strong 
penalties in order to act as a deterrent.
    Mr. Cole. Well, I would love, just in closing here quickly, 
to work with you on that.
    Ms. Colvin. I would----
    Mr. Cole. Obviously, that is not our jurisdiction. We are 
an appropriations committee, not an authorizing. But, boy, if 
there is ever an area for bipartisan cooperation, this is 
clearly it. I have never met anybody that is not outraged by 
this, this sort of thing and thinks you ought to be throwing 
the book at people that are defrauding Social Security or 
Social Security disability.
    And let alone when it is a systematic scheme of major 
proportion, or it is I could not agree more with your remarks 
and your obvious indignation at somebody collecting a check for 
15 years on somebody that is deceased. I mean, that is a 
criminal activity, and it actually dishonors the person's 
memory as well, in my view. But just not appropriate.
    So thank you for the----
    Ms. Colvin. And you know, 99.9 percent of our beneficiaries 
are honest people, and I do not want the program jeopardized 
because of a few who get a benefit to which they are not 
entitled.
    Mr. Cole. Well, good for you.
    I will go next to my good friend from Connecticut.
    Ms. DeLauro. Thank you very much, Mr. Chairman.
    I would add to your comment I think it is just outrageous 
of trying to game the system in Social Security. I think we 
have to be equally concerned about the penalties that are 
imposed with regard to the Medicare system and what we find by 
way of fraud in the scales that exist in the Medicare system 
and would love to work with you on that as well. Because I 
think that that is, you know, not the direction we want to go 
in.

           CAP ADJUSTMENT: HOME AND COMMUNITY BASED SERVICES

    Administrator Greenlee, I just wanted to ask you, I have 
heard the end of the conversation on the community-based 
support services and the home and community-based support 
service, and obviously I am for your approach and where you 
want to go.
    But the issue in terms of practicality and looking at money 
saved, and I do not know if that is in your purview, but I 
think we need to take a look at as appropriations committee 
about if we move in that direction from whether it is long-term 
care, short-term care, whatever it is, to a home-based setting 
and what would the savings in that effort be?
    Have you looked into that? Have you calculated that? It may 
not be within your purview, but where is the discussion about 
the amount of money that we might save as a result of moving to 
home-based and community-based support services?
    Ms. Greenlee. I think there are two conversations, one that 
is more pertinent specifically to my agency. But the other one 
is the Medicaid conversation----
    Ms. DeLauro. Right.
    Ms. Greenlee [continuing]. That you very much see about 
rebalancing the Medicaid system so that we provide Medicaid 
services in the community because it is so much less expensive 
than in any institutional setting. We are a companion piece, 
and if you start talking about the types of services that we 
provide, whether it is through the Centers for Independent 
Living and Area Agencies on Aging, they are so much less 
expensive. I mean, we start talking about a few thousand 
dollars a year, instead of tens of thousand dollars a year to 
help someone with basic supports to stay independent.
    Because of the way the budget mechanisms work, these are 
discretionary funds, those are mandatory. I wish I could 
capture all the savings that I think we could prove. But I 
think we can make a case that these really are wise 
investments, prevention investments, and keep people from 
seeking a more expensive alternative.
    Ms. DeLauro. Okay. I would just mention this. There are two 
other areas in the Labor, HHS bill where we have something 
known as a cap adjustment. It is a special budget designation 
for programs to create savings in mandatory programs, such as 
Medicare, Medicaid, Social Security.
    Given that the substantial savings that your programs--that 
would accrue to Medicaid, one of the things that I would like 
to explore is a cap adjustment for home and community-based 
support services and family caregivers. I would like to work on 
that.

                          HOME CARE WORKFORCE

    And you talked about or I was not here when you talked 
about home care workers. We need a qualified and a trained 
workforce in this effort. I struggled for years to be able to 
get qualified people to take care of my mother. I now have 
seven people because it is----
    Ms. Greenlee. Yes.
    Ms. DeLauro. You know? And to be honest, there are 
different levels. Some are just basically a companion. Some can 
take care of the needs. What more needs to be done in this area 
of the training in order to make--to have qualified home care 
workers?
    Ms. Greenlee. I think we have to keep talking to our sister 
agencies at HHS, such as HRSA, because that is really where 
they have the workforce investment dollars and investments, 
whether the Affordable Care Act or other direct appropriations 
to them, to help supply a workforce to care for an aging 
population.
    We do not have a direct workforce kind of component. Ours, 
as I was saying earlier, is more to help the family, to help 
the person who is working with caregiver support, help the 
older person who may need some assistance, help families that 
if they have younger people with disabilities there so they can 
remain in the workforce.
    But the workforce investment needs to be made because, yes, 
to really help someone be at home, it is going to take a 
trained workforce. And people are assuming more complicated 
medical tasks ever than before. So it is a good news story.
    Ms. DeLauro. Right.
    Ms. Greenlee. We really can help people with severe 
limitations or disabilities in community, but it takes a skill 
set to be able to do that competently.
    Ms. DeLauro. Mr. Chairman, I have just two questions. Can 
I--thank you. Thank you.
    With regard to I have one question for you, Ms. Greenlee, 
and then one for the Commissioner. On ACL, there were agencies 
combined, the Administration on Aging, Administration on 
Intellectual and Developmental Disabilities combined to create 
this single agency. You have taken on additional programs, 
independent living and the National Institute of Disability. 
Where do you see yourself in terms of the effectiveness of what 
you are doing in this combined agency over the last few years?
    Ms. Greenlee. My favorite way to describe us now is that we 
are a multicultural agency. And in a sense that we are really 
responsible for representing the cultures of all different 
kinds of people--older adults, younger people with 
disabilities. And in a multicultural sense, it means that we 
need to be mindful of what we have in common and also mindful 
of the things that are differences.
    I see this as a large Venn diagram between aging and 
disability. And what we have gained by bringing these programs 
together is a much more significant presence as we talk more 
comprehensively about long-term supports and services.
    The Older Americans Act is an essential program to provide 
supports, but long-term supports and services for all 
populations is a much bigger conversation. I think we have more 
expertise at the table, more of a stakeholders investment in 
making sure that we continue to provide services in the 
community that are less expensive, that are more desired.
    And for that, it is an aging and disability combined 
conversation. It is not one or the other.
    Ms. DeLauro. Okay. Thank you. Thank you very much.
    And finally, Commissioner, the National Support Center?
    Ms. Colvin. Yes.
    Ms. DeLauro. That you are making good progress on the 
center. You began to transition, the transition of IT services 
from the 30-year-old computer center to a new National Support 
Center. So I think you are about 4 or 5 months ahead of 
schedule in this effort.
    Ms. Colvin. Yes.
    Ms. DeLauro. So are you still on track to complete the 
transition of IT services to the National Support Center by 
August of next year? Are you still on track to complete the 
project within its original budget?
    Ms. Colvin. Yes, yes, yes. We are excited about this. This 
is a project that we really received great bipartisan support 
on, and we came in under budget and ahead of schedule. So it is 
a nice note to end on.
    Ms. DeLauro. And ahead of--all right.
    Ms. Colvin. Thank you.
    Ms. DeLauro. Cannot do better than that.
    Ms. Colvin. Absolutely.
    Mr. Cole. I was going to say I know a set-up when I see 
one. [Laughter.]
    That was very impressive.
    Ms. Colvin. Can I make a----
    Mr. Cole. What a way to end it. I have a wily ranking 
member.
    Ms. Colvin. Mr. Chairman, I want to make a correction for 
the record because I do not want people to think I do not know 
this. But the new retirement age is 66.
    Mr. Cole. I wondered. You really were concerning me because 
I turned 66 in April, and then I heard 68.
    Ms. Colvin. But 67 is the age in 2027.
    Mr. Cole. Oh, I know.
    Ms. Colvin. So it is 66 now, and it is 67 for 2027.
    Ms. Greenlee. That is the year I turn 67.
    Mr. Cole. Let me just in concluding make a few remarks. 
First of all, I want to thank both of you, honestly, for the 
wonderful work that you do and the people that work with you 
and your respective staffs. I mean, these are clearly agencies 
that really do touch a lot of lives, make a lot of lives 
better.
    And frankly, these are areas where the data shows we have 
made considerable progress under your leadership. So thank you 
both for what you are doing. A lot to be done.
    There is always--you could tell we have a pretty busy 
morning, and a lot of members were in and out. But there is a 
real interest in what you are doing, and they all came with 
very specific questions and something they wanted to know about 
or bring to your attention. So, again, I think that is a pretty 
good indication of how serious all of us take this.
    I tend to judge agencies actually more less by what I hear 
here and more by what I hear from my case workers, who are 
literally interacting on ground. And I have to tell you, in 
both cases I get wonderful comments back for both the agencies 
that you are there.
    They really appreciate when somebody calls with a problem 
the kind of responsiveness they get, Social Security or local 
aging communities, people that you are intimately involved 
with. So thank you for that very much.
    Let me end with this on a somewhat sober note. I also 
happen to sit on the Budget Committee, which no appropriator 
likes to do. I mean, it is usually you have offended the 
chairman somehow, and you are sent to the Budget Committee.
    But the grim reality is right now sequester is the law of 
the land. It is not a policy. It is not a choice. It is a law, 
and it is a law that was passed by Congress, signed by the 
President. And frankly, the President advocated sequester. If 
you go back and read Bob Woodward's book, The Price of 
Politics, pretty clear what happened.
    Having gotten there, you know, we are now producing budgets 
that say, well, if it did not exist, this is what we would do. 
I am not convinced at all that we are going to be able to get 
out of this particular thing and particularly during the 
appropriations process. I suspect we will end up appropriating 
to the law.
    Now I would hope that we find a way not to do that, that 
there is another Ryan-Murray type agreement or some larger 
agreement. For that to happen, though, the President has to be 
engaged, and there has to be some mechanism or process set up. 
So, obviously, the congressional leadership does, too. I am not 
trying to do an either/or here.
    But I do think, absent some sort of negotiation that is 
initiated at levels well above the pay grade of anybody on this 
panel, this is where we are going to end up. And so, you know, 
again, I know the President has a proposal, but I also know 
that he is politically wise and sophisticated enough to know 
even though I am sure he believes in the proposal he offered, 
that is not going to happen.
    So the only way around that is some sort of negotiated 
agreement. We managed to do that a couple of years ago, and I 
think while nobody would tell you the Ryan-Murray deal was the 
best thing they ever saw, it was a lot better than the 
alternative that we would have had.
    And we are going to have these tough choices in panel after 
panel. When I talk to my friends that are in Defense, where I 
also sit on that subcommittee, I know they are very worried. 
And I do not think the way out of this, by the way, is to rob 
the nondefense agencies to plus-up defense, which some 
advocate. We are just going to have a larger global settlement 
here, or we will end up living under the law.
    So, number one, just again thank you for your service, and 
we hope that we do not make it harder on you rather than 
easier. But also, and I urge this to my friends on both sides 
of the aisle, I am going to be making this kind of statement on 
a regular basis in this committee and on others. People have 
got to sit down and start talking about this and not talking 
past one another or politically positioning themselves, but 
literally sit down saying, ``Are you prepared to live with the 
law?'' If not, what can we do to change the law and to direct 
resources in defense and nondefense areas where they can make a 
difference.
    Certainly, both of you and your respective agencies have 
made a difference and are making a difference, very positive 
difference in the lives of millions and millions and millions 
of our fellow Americans. And we just say, you know, at the 
political level, the Congress and the administration need to 
sit down and work this thing out.
    And we have done it before, but only for short periods. I 
would much prefer--I would never presume to draw you, 
Commissioner, into a discussion on what I think needs to happen 
long term on Social Security. Not your job, as you 
appropriately point out. You are there to administer the 
agency.
    But that is the place we need to sit down and have some 
discussions. We know we have got, as you said, an age wave--I 
like that term, I am going to steal it--coming along, and it is 
going to put a strain on all parts and particularly the 
discretionary part of the budget.
    But again, I just want to thank both of you. Very much 
appreciate the testimony. Very much appreciate your efforts on 
behalf of the American people and particularly on behalf in 
many cases of people that do not have the ability to look after 
themselves.
    And I can tell from your testimony how serious both of you 
are about this, how important a task this is for you. Clearly, 
when they can talk you out of retirement, Commissioner, you 
must feel pretty strongly about this. [Laughter.]
    And I just appreciate the level of commitment to public 
service.
    So thank you very much, and with that, we are concluded.
    
    
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                                            Tuesday, March 3, 2015.

                     NATIONAL INSTITUTES OF HEALTH

                               WITNESSES

FRANCIS S. COLLINS, M.D., PH.D., DIRECTOR, NATIONAL INSTITUTES OF 
    HEALTH
ANTHONY S. FAUCI, M.D., DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND 
    INFECTIOUS DISEASES
THOMAS R. INSEL, M.D., DIRECTOR, NATIONAL INSTITUTE OF MENTAL HEALTH
JON R. LORSCH, PH.D., DIRECTOR, NATIONAL INSTITUTE OF GENERAL MEDICAL 
    SCIENCES
NORA D. VOLKOW, M.D., DIRECTOR, NATIONAL INSTITUTE ON DRUG ABUSE
GARY H. GIBBONS, M.D., DIRECTOR, NATIONAL HEART, LUNG, AND BLOOD 
    INSTITUTE

                    Statement of Representative Cole

    Mr. Cole. Good morning. It is my pleasure to welcome you to 
the Subcommittee on Labor, Health and Human Services, and 
Education to discuss the fiscal year 2016 National Institutes 
of Health budget request.
    We are looking forward to hearing the testimony of Dr. 
Collins and some of his distinguished colleagues.
    I would like to publicly thank Dr. Collins and the staff at 
NIH for hosting me and five other subcommittee members for a 
briefing and tour of the NIH campus a few weeks ago.
    I think it is safe to say we all left the NIH with a deeper 
appreciation of the exciting work your staff do every day to 
find ways to save lives.
    The scope of biomedical research supported through and at 
the NIH is wide, and we are confident that, thanks to the 
talented staff and scientists that work there, we will one day 
find cures for diseases like cancer and Alzheimer's. Ensuring a 
sufficient basic biomedical research base and supporting the 
next generation of researchers is critical to pave the way for 
these long-term advancements.
    Your budget assumes many areas of enhanced spending on 
genomic activity, including a focus on Ebola, universal flu 
vaccine, antibiotic resistance, and Alzheimer's research, to 
list only a few.
    Of course, we all support biomedical research. 
Unfortunately, right now, sequester is the law of the land, 
and, given the reality of funding allocations, we might not be 
able to do everything that the administration is proposing 
absent a larger bipartisan budget agreement--one, quite 
frankly, that I hope we achieve.
    I look forward to having a discussion with you this morning 
on your top priorities for this year given our funding 
constraints.
    I would also be remiss if I did not point out how important 
it is to ensure that we continue to focus on the next 
generation of investigators. We know how long it takes for a 
new drug or treatment to make it from lab to the patient. So, 
without a pipeline of young researchers committed to following 
the scientific process of investigation and experimentation, we 
won't be able to find the cures we seek.
    Today, we welcome Dr. Francis Collins, the NIH Director, to 
the subcommittee.
    Dr. Collins is accompanied by five of his distinguished 
institute directors, who can assist in answering specific 
Member questions. They are: Dr. Anthony Fauci, the Director of 
National Institute of Allergy and Infectious Diseases; Dr. 
Thomas Insel, the Director of the National Institute of Mental 
Health; Dr. Jon Lorsch, the Director of the National Institute 
of General Medical Sciences; Dr. Nora Volkow, the Director of 
the National Institute on Drug Abuse; and Dr. Gary Gibbons, the 
Director of the National Heart, Lung, and Blood Institute.
    As a reminder to the subcommittee and our witnesses, we 
will abide by the 5-minute rule.
    And before we begin, I would like to yield the floor to my 
chairman, the gentlemen from Kentucky. After that, we will move 
to our ranking member, the gentlelady from Connecticut, and 
then to the gentlelady from New York, our ranking member on the 
full committee.
    So, with that, Mr. Chairman, you are recognized.
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                 Statement of Representative Hal Rogers

    Mr. Rogers. Mr. Chairman, thank you very much. 
Congratulations on being the new chairman of this great 
subcommittee and the responsibilities that you have gladly 
taken on.
    Welcome to all of you. Thank you for being here.
    Dr. Collins, your leadership role in the groundbreaking 
international Human Genome Project is just one example of your 
many talents. I am told that another one of your talents is 
playing guitar, apparently--apparently very well. So, you know, 
you have something to fall back on in case this don't work out.
    Unquestionably, you all are at the helm of research at NIH 
during a time that demands our country's interest and 
investment in medical research. The recent Ebola epidemic in 
West Africa highlights the importance of NIH's mission to gain 
and apply knowledge to enhance health, lengthen life, and 
reduce illness and disability.
    Medical research is one of the most important parts of 
preventing future epidemics and developing cures for diseases 
that are not preventable. The NIH fiscal 2016 budget request 
highlights priorities such as Ebola, Alzheimer's disease, and 
antimicrobial resistance.
    In addition to the public health benefits that accompany 
NIH work, the economic impact of medical research should not be 
underestimated. NIH research dollars not only impact research 
and facilities and researchers, but they also help get new 
drugs and devices to the marketplace.
    And I am pleased that you have seen fit to invite Dr. Nora 
Volkow to join us this morning. As the Director of the National 
Institute of Drug Abuse, Dr. Volkow has been a true pioneer in 
the science of drug abuse and addiction. She was one of the 
first people in history to use brain imaging to investigate the 
effects and addictive properties of abusable drugs, and her 
research has undoubtedly made the world that we live in a much 
better place. She has been with us since day one as we have 
battled drug abuse in my area, in southern and eastern 
Kentucky, hard-hit especially early on by OxyContin and others.
    And I am looking forward to seeing both of you, in fact, at 
the Atlanta summit on prescription drug abuse this summer. And 
I thank you for coming last year and helping us battle this 
prescription drug abuse scourge that is killing more Americans 
than car wrecks. And we appreciate your dedication to that, 
especially.
    We look forward to hearing also from you today about two 
critical drug-related issues. First, I am pleased that NIDA, 
under Dr. Volkow, is pursuing an Adolescent Brain Cognitive 
Development Study, ABCD, to collect rigorous longitudinal data 
on the effects of marijuana, alcohol, nicotine, and other drugs 
on a young person's brain.
    It is unfathomable to me that States continue to pursue 
policies to decriminalize or legalize marijuana in 
contravention of Federal law, I might add, even here in the 
Nation's Capital. It is ironic that in Washington, D.C., the 
Nation's Capital, you can't smoke cigarettes but you can smoke 
pot. Explain that to me. Help me out.
    We don't have scientific data to tell us about the long-
term impacts of marijuana use on the brain, but hopefully this 
will open a lot of minds. This study will help close that gap, 
hopefully bring some much-needed sense to the conversation 
about marijuana use in this country.
    Secondly, Dr. Volkow, I am interested to hear about recent 
efforts regarding the abuse of prescription medications. As you 
well know, that has been characterized by your colleagues at 
CDC as a national epidemic. I understand that you are 
partnering with nine major pharmaceutical companies to evaluate 
the risks associated with the long-term use of opioids for the 
management of chronic pain. If there are non-opioid 
alternatives to the treatment of pain, we need to know about 
them and doctors need to be educated about them.
    I am also hoping that you can provide us with an update on 
the science of abuse-deterrent medications. It is remarkable 
that OxyContin, the drug that caused so much difficulty--and it 
still is, but mostly back 5, 6 years ago. The drug was changed 
to make it drug-abuse-deterrent. You can't crush it, you can't 
snort it, you can't inject it. It still retains, though, the 
good qualities of relieving pain over an extended period. That 
is what can be done to stem the use of opioids, and I commend 
you for it.
    In addition to our longstanding struggles with drug 
addiction and abuse, the research provided by NIH is critical 
to understanding, preventing, and developing cures for ailments 
like diabetes, cancer, and heart disease that continue to 
plague my region especially.
    We are very proud of the partnerships we have established 
with NIH in Kentucky--for example, the Markey Cancer Center, a 
National Cancer Institute-designated cancer center at the 
University of Kentucky; and the U.K. Center for Clinical and 
Translational Science, which previously received your 
prestigious Clinical and Translational Science Award for its 
work to confront chronic health issues in Kentucky and rural 
populations, especially in the Appalachian region.
    Currently, 22 of the world's 50 top-ranked universities for 
life sciences are in the U.S., and we must continue to foster 
the next generation of scientists. We look forward to 
continuing these important collaborative efforts as we work 
together to bring an end to these devastating diseases.
    We thank you for being here. And, with your colleagues, Dr. 
Collins, we expect to hear some good stuff.
    I yield.
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    Mr. Cole. Thank you, Mr. Chairman.
    Next, we will go to ranking member, distinguished 
gentlelady from Connecticut, and, frankly, a tireless champion 
of this particular agency for many, many years.

                Statement of Representative Rosa DeLauro

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    And good morning to everyone. It is a little earlier than 
we usually start these hearings, but it is such an important 
topic that it was important to all of us to have the 
opportunity for the full 2 hours with the distinguished panel.
    I am so thrilled to welcome you, Dr. Collins, the Director 
of the NIH, Dr. Fauci, Dr. Volkow, Dr. Insel, Lorsch, Gibbons, 
to discuss the 2016 budget request for NIH.
    First and foremost, let me just say thank you for your 
work. Every scientific discovery, every medical breakthrough, 
the research you support advances human knowledge, and it 
improves the quality of our lives. And, most of all, it saves 
lives. And as an almost 30-year survivor of ovarian cancer, I 
am alive today because of the grace of God and biomedical 
research. When I was elected to the Congress, I made supporting 
that research one of my top priorities.
    As well as improving health, research also drives our 
economy. As the chairman said, every dollar invested in NIH 
repays more than double that in local economic growth. NIH is 
the cornerstone of our life sciences industry, which employs 
more than 7 million Americans, adds almost $70 billion to our 
GDP. So there is no reason not to fund NIH as fully as 
possible.
    In January of this year, along with the chairman, I had the 
pleasure of touring the NIH, and along with other members of 
the subcommittee. It was, as always, a fascinating visit.
    While there, we met with a senior investigator, Dr. Nancy 
Sullivan, who is largely responsible for one of the Ebola 
vaccine candidates that is currently being tested in a clinical 
trial. That clinical trial is only possible because, thanks to 
NIH support, Dr. Sullivan and her colleagues have been able to 
pursue a vaccine over many, many years--since 1997, in fact.
    Research can take a long time to bear fruit, and if we do 
not invest now, we will not be able to benefit from scientific 
discoveries 5, 10, even 20 years from now. So it is troubling 
to me, deeply troubling to me, to note that since fiscal year 
2010, after adjusting for inflation, NIH has seen its budget 
erode by about $3.6 billion. That is an 11 percent cut.
    Sequestration is terrible policy for any budget. It is 
especially cruel where there are literally lives at stake. In 
2013 alone, sequestration took more than $1.5 billion from the 
NIH. Even after modest increases over the past 2 years, we 
still have not returned NIH's budget to its pre-sequestration 
level.
    A decade ago, NIH was able to fund almost one out of every 
three applications for research grants. Amid sequestration, 
that success rate has fallen to one in six. In 2015, NIH will 
fund almost 1,000 fewer research projects than it did in 2010. 
We will never know how many scientific discoveries and medical 
breakthroughs the world may have missed out on because of these 
budget restraints.
    That is the disturbing context in which we consider the NIH 
budget request for fiscal year 2016.
    Overall, this request starts to set us back on the right 
track. There are some exciting initiatives in this budget. The 
Precision Medicine Initiative will help doctors provide 
treatment finely tailored to the individual characteristics of 
each patient. The Combating Antibiotic-Resistant Bacteria 
Initiative, CARB, focuses on defending against deadly super-
bugs. The BRAIN Initiative holds the potential to revolutionize 
neuroscience and to make advances to treat Alzheimer's, autism, 
and many other brain disorders.
    The budget includes funding for research to develop a 
universal flu vaccine and potentially a cure for HIV/AIDS. It 
also supports basic science research that has long-term 
benefits across multiple fields.
    As I said, I believe this is the right track, but, given 
the severe neglect of NIH over the past few years, I am 
disappointed that we are not restoring funding more quickly. 
This request restores less than one-third of the cuts since 
fiscal year 2010.
    I introduced a bill in the last Congress and again in this 
Congress that would enable our committee to increase NIH 
funding by 10 percent this year and 50 percent over 5 years by 
providing a cap adjustment. That would ensure proper funding 
for research without robbing other vital programs to do so.
    We have invested strongly in NIH before. In the 1990s, I 
was among a bipartisan group of Members of both chambers on 
this committee who fought to double NIH's budget over 5 years. 
To this day, it stands among my most proud achievements.
    Instead of starving the NIH of funds, we should be seeking 
to repeat that achievement and double its budget again. But 
this investment cannot happen unless and until we undo that 
failed policy of sequestration and summon the courage to ask 
those who can, the wealthiest who have done so well in recent 
years, to contribute more to support our national priorities.
    Biomedical research gives us the gift of life. It has done 
so for me and for countless others. That is what the NIH 
represents. We can and we must find the resources to support 
it.
    And I thank you.
    I thank you, Mr. Chairman.
    Mr. Cole. I thank you.
    I next go to my good friend, distinguished gentlelady from 
New York, for her opening statement.

                   Statement of Representative Lowey

    Mrs. Lowey. Well, thank you, Mr. Chairman.
    It is a pleasure for me to be here today. And I would 
really like to thank Chairman Cole and Ranking Member DeLauro 
for holding this hearing today.
    It is such an honor for me to have such a distinguished 
group of public servants: Drs. Collins, Fauci, Insel, Lorsch, 
Volkow, and Gibbons.
    I really appreciate your being with us today, and I thank 
you for the lifesaving work that you do every day.
    Throughout my time in Congress, Federal funding for the 
National Institutes of Health has been among my very top 
priorities. The NIH is the world's premier research institute. 
Its researchers have mapped the human genome.
    And I do remember, Dr. Collins, that empty shape that you 
have filled up. It is really amazing.
    You have created vaccines that are being tested to prevent 
the spread of Ebola, developed advances in cardiovascular 
disease that have reduced death rates by more than 60 percent 
over the last half-century, and invested in HIV therapies that 
turn what used to be death sentences into longer, more 
productive lives.
    As a result, it is no surprise, but it continues to amaze 
me, that NIH-supported scientists have been awarded no less 
than 145 Nobel Prizes.
    Not only does NIH's work improve the quality of life for 
millions of Americans, it is also a springboard for economic 
growth, generating $2.21 in economic activity for every dollar 
invested. And I remind my friends and neighbors all the time 
that not only are you moving ahead in saving lives but you are 
creating jobs.
    Your 2016 budget request proposes an increase of $1 
billion, resulting in 1,200 additional competitive research 
grants. It would make welcomed investments in advanced cancer 
treatments with the new Precision Medicine Initiative; increase 
funding, as my colleague Ms. DeLauro said, for the BRAIN 
Initiative to research the workings of the brain, develop 
treatments to combat Alzheimer's disease, autism, and other 
neurological and psychiatric conditions. These are the very 
definitions of worthy Federal investments.
    The President has also called for the end of the mindless 
austerity of sequestration. In fact, I have even heard some of 
my colleagues on the other side of the aisle refer to the 
mindless austerity of sequestration, urging Congress to replace 
it with more targeted spending cuts, program integrity 
measures, closure of some outdated tax loopholes. I could not 
agree with them more.
    The effects of sequestration are immense and are still 
being felt. In 2013 alone, sequestration reduced the NIH 
investment by more than $1.5 billion, and fiscal year 2015 
funding is still below the pre-sequester level. Many critically 
important research initiatives were abruptly halted. It really 
was a worst-case scenario for many agencies, and we have to 
make sure it does not happen again.
    The United States must keep pace with the rest of the 
world. While NIH funding is $3.6 billion, or 11 percent below 
the fiscal year 2010 level when adjusted for inflation, others 
are making substantial increases. Between 2007-2012, China 
increased their biomedical research spending by $9 billion--
increased. While others are advancing, our investments in 
biomedical research are just not keeping up.
    As we begin the annual process of crafting a budget 
resolution, I know there will be many viewpoints. Many of my 
colleagues may undoubtedly press for additional cuts and to 
leave the outdated sequester-level caps in place. But I think 
we all know how dangerous that is.
    Discretionary funding, which includes biomedical research, 
education, job training, transportation infrastructure, and 
clean energy development, is falling to its lowest level as a 
percentage of GDP since the Eisenhower administration.
    We must act to ensure reasonable allocations for the 
important programs and investments funded through the 
appropriations process, especially the National Institutes of 
Health and those under the jurisdiction of this subcommittee.
    I look forward to your testimony. Thank you again for being 
here before us, and I look forward to the NIH's plans for the 
coming year.
    Thank you.
    Mr. Cole. I thank the gentlelady.
    And, Dr. Collins, your full statement will be entered into 
the record, and you are recognized for whatever opening 
comments you care to make.

                        Statement of Dr. Collins

    Dr. Collins. Well, thank you. And good morning, Chairman 
Cole, Ranking Member DeLauro, distinguished members of this 
subcommittee. It is an honor to appear before you today, as 
this panel has a long history of supporting NIH's mission to 
seek fundamental knowledge and apply it in ways that enhance 
human health, lengthen life, and reduce illness and disability.

                  NIH SUPPORTED RESEARCH BREAKTHROUGHS

    Breakthroughs generated by NIH-supported research are 
behind many of the gains you see here that our country has 
enjoyed in health and longevity. For example, over the last 60 
years, deaths from cardiovascular disease have fallen by more 
than 70 percent. Meanwhile, cancer death rates have been 
dropping about 1 percent each year for the last 20 years. And, 
likewise, HIV/AIDS treatments have greatly extended lives, and 
prevention strategies are enabling us to envision the first 
AIDS-free generation.
    The future of biomedical research has never been brighter. 
Allow me to tell you about just a few of the many exciting 
opportunities that NIH is pursuing today.
    Let's start with vaccines. Thanks to NIH research, two 
different vaccines against the deadly Ebola virus are being 
tested right now in Liberia.
    Vaccine research is also making exciting progress against a 
virus that nearly all of us have tangled with: influenza. 
Currently, a new flu vaccine has to be produced every year 
based on our best guess of how the virus will evolve, but that 
approach isn't ideal, as we have learned this past season, so 
NIH-funded researchers are working to design a universal 
vaccine that will protect against virtually all flu strains. 
Such a vaccine could eliminate the need for annual flu shots 
and reduce the risk of a global pandemic. So I am excited to 
tell you that universal flu vaccine candidates have now moved 
into early-stage human clinical trials.

                     NIH SUPPORT FOR BASIC RESEARCH

    NIH also remains strongly committed to supporting basic 
science, fundamental research that serves as the foundation for 
discoveries that have long made America the world leader in 
biomedicine.
    One exciting example is the BRAIN Initiative. This bold, 
multi-agency effort is enabling development of innovative 
technologies--you see one here--to produce a clearer, more 
dynamic picture of how individual brain cells and neural 
circuits interact in time and in space. This initiative will 
give us the tools for major advances in brain diseases, from 
Alzheimer's and autism to schizophrenia and traumatic brain 
injury.

                           PRECISION MEDICINE

    Scientific advances are also accelerating progress toward a 
new era of precision medicine. Historically, doctors have been 
forced to base their recommendations for treatments on the 
expected response of the average patient. But recent advances, 
including the plummeting cost of DNA sequencing, now make 
possible a more precise approach to disease management and 
prevention that takes into account individual differences in 
genes, environment, and lifestyle.
    With this in mind, we are thrilled at NIH to take a lead 
role in the multi-agency Precision Medicine Initiative. In the 
near term, this initiative will focus on cancer. To accelerate 
efforts, this project will support research aimed at 
understanding why cancers develop drug resistance, using 
noninvasive methods to track therapeutic responses, and 
exploring new treatments targeted to the genetic profiles of a 
wide range of adult and pediatric cancers.
    As a longer-term goal of this initiative, NIH will launch a 
national research cohort of 1 million or more volunteers who 
will play an active role in how their genetic and environmental 
information is used to prevent and manage a broad array of 
diseases. A project of this magnitude will lay the groundwork 
for new prevention strategies and novel therapeutics.
    There is no better time than now to embark on this 
enterprise to revolutionize medicine and move this precise, 
personal approach into everyday clinical practice.

                               Conclusion

    In closing, let me share a story that highlights the early 
promise of precision medicine. When Maki Inada was diagnosed 
with stage 3B adenocarcinoma of the lung in 2008, it was 
completely unexpected. She was just 36 years old, had never 
smoked a day in her life. Her tumor was very large, as you see 
here, 7 centimeters, with a very low likelihood of survival 
beyond a year or two.
    [The information follows:]
    
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    Dr. Collins. As Maki began the recommended standard 
chemotherapy, her doctor suspected she might have a particular 
mutation in a gene called epidermal growth factor receptor 
(EGFR). Genetic testing confirmed their hunch, and Maki was 
prescribed Tarceva, a drug that precisely blocks EGFR's signal.
    After 3 months of treatment, Maki's large tumor shrunk 
dramatically. This was followed by surgery to remove cancerous 
tissue, plus retreatment with Tarceva. Today, seven years after 
her diagnosis, her doctors can detect no signs of cancer.
    What is more exciting during the extra time provided by 
this approach, Maki competed in a triathlon, landed her dream 
job as a biology professor at Ithaca College, and welcomed a 
healthy baby girl.
    Clearly, we need many more stories like Maki's. That is our 
dream, and I am sure it is yours too.
    With your support, we can realize our vision of 
accelerating discoveries across the vast landscape of 
biomedical research, from basic scientific inquiry to more 
precise, personalized approaches to treatments and cures.
    So thank you, Mr. Chairman. My colleagues and I now welcome 
your questions.
    [The information follows:]
    
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    Mr. Cole. Thank you very much, Dr. Collins.
    And just for the members of the committee, we are going to 
go first to our chairman and our ranking member, and then we 
will go through our normal order, in terms of questions.
    So, Mr. Chairman, you are recognized for whatever questions 
you care to pose.

             ADVANCES TOWARD EFFECTIVE DRUG ABUSE DETERRENT

    Mr. Rogers. Thank you, Mr. Chairman.
    Dr. Collins, Dr. Volkow, thank you both for your special 
interest in prescription drug abuse.
    As you know, every day about 105 Americans die from 
overdose, mostly prescription medicine. Sadly, as we have taken 
strides to address that challenge, we have also seen a rise in 
heroin use and its consequences, as people that are addicted to 
painkillers graduate to those drugs, that are cheaper.
    I have long advocated for a multipronged approach to 
addressing this unique challenge, and, of course, research is 
one of the main prongs of that approach. I am particularly 
interested in the development of new technologies that will 
make these drugs more difficult to abuse. And we have seen some 
real progress in that field--effective abuse-deterrent 
technologies that will ensure that patients truly in need of 
these therapies can receive treatment, while also ensuring that 
these very powerful, addictive medications can't be tampered 
with or abused.

                   ADVANCES IN DETERRENT TECHNOLOGIES

    Let me ask you, what investments has NIH or NIDA made to 
advance the science of abuse-deterrent technologies? And can 
you comment on the fruits of those labors?
    Dr. Collins.
    Dr. Collins. Well, Mr. Chairman, thank you for the question 
and for your leadership in this area, which is really quite 
remarkable, the way which you have shown a bright light on the 
importance of our addressing this, brought experts together, as 
you have done each year and will do again in April.
    I am going to ask Dr. Volkow, who is an internationally 
recognized expert in this area, to address your question.
    Nora.
    Dr. Volkow. Dr. Collins, thanks very much.
    Mr. Chairman, thanks very much for asking the question and 
for your interest in the matter.
    And, as you describe it, we do use a multiprong approach 
also in science to address the issue of the prescription opioid 
abuse problem.
    One of them is effectively to develop medications that, if 
they are opioid-based, they have the deterrent formulation so 
that they cannot be diverted and abused in ways that they can 
produce addiction and harm. And many strategies have been 
developed, and some of them relate to the combination of drugs. 
Others relate to inserting the drug into a polymer so it cannot 
be diverted.
    In this effort, we partner with pharmaceutical companies, 
so it is a public-private partnership to enhance the likelihood 
that the products will get into the market. And, again, here 
innovation has led to very different ways of solving the 
problem. That is one.
    The other one is the development of medications and 
strategies to prevent deaths from overdoses because they are 
antidotes. In fact, Nyloxin is very, very effective in 
preventing overdoses. And we have again partnered with the 
pharmaceutical industry in order to be able to provide with 
Nyloxin in ways that are user-friendly and anyone can 
administer them.
    And, thirdly, as importantly, we cannot underestimate the 
relevance of developing medications to treat those individuals 
that become addicted to opioid medications, because the proper 
treatment can prevent the overdoses.
    In parallel, we are also working on implementation research 
to ensure that practitioners will provide better screening and 
treatment of patients with pain, minimizing risks, and as well 
as substance abuse disorders.

                         PRODUCING TECHNOLOGIES

    Mr. Rogers. NIDA is working to develop an abuse-deterrent 
formulation of OxyContin using what I understand is called pro-
drug technology. What is that?
    Dr. Volkow. The pro-drug technology is you administer a 
medication that is not active until it suffers a second 
conversion. In this case, the medication that we are working 
with Signature Pharmaceuticals is a pro-drug that will not 
become active until it gets into the gastrointestinal system 
and the enzyme trypsin then activates it.
    The advantage, therefore, is someone, if they want to 
inject the drug, which is the way that these drugs are abused, 
there will not be any pharmacological effects because it will 
be an inactive drug. It requires the enzyme in the 
gastrointestinal tract to activate it.
    Mr. Rogers. What do you think about it?
    Dr. Volkow. I think very promising. There is already 
evidence in the past for pro-drug stimulant medications that 
have shown they are much less likely to be diverted and to 
produce problem of the addiction.
    Dr. Collins. I might mention that Dr. Volkow has taken a 
personal interest in that particular approach and has worked 
closely with the company to try to be sure that NIH, in a 
public-private partnership, can play our role in encouraging 
that effort to go forward, ultimately, we hope, to FDA 
approval.
    Mr. Rogers. Well, I mean, if this should be successful, 
this is a major breakthrough, is it not?
    Dr. Volkow. It would be a very important breakthrough. And 
we hope that we will be hearing soon. I mean, we are expecting, 
hopefully, some results in the very near future.
    Mr. Rogers. About when?
    Dr. Volkow. Well, I am on a confidentiality agreement, so I 
cannot give details. But let's say that we hope that we will be 
hearing soon.

                 ENCOURAGING PRIVATE SECTOR INVESTMENT

    Mr. Rogers. Well, it is an exciting thing. OxyContin, like 
many other of the opioids, are wonderful drugs for terminally 
ill cancer patients and the like, 12-hour release. But if it 
can be crushed and injected, all of a sudden you get a 12-hour 
release in a split second, and, thus, the addictive power of 
this drug. So if you can find a way that we can use its great 
qualities while preventing it from being abused, that would be 
an extremely well-liked lifesaving development. A hundred and 
five people a day are dying from drug overdose.
    How can we incentivize the private companies to invest in 
the development of these technologies? How can we make it so 
there is something in it for them?
    Dr. Volkow. Well, to start with--and, again, it is an 
example about how science and policy need to work together. As 
these products are developed, there is research invested and 
dollars invested into it. So, we want to ensure that, once 
these products are developed, physicians will be able to 
prescribe it and companies will pay for those prescriptions.
    So, I think that ensuring that the innovation that results 
in safer medications that, however, may be slightly more 
expensive is supported by the resources that will make it 
possible for patients to get access to these medications.
    Mr. Rogers. Well, I thank you for your work and your 
dedication.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you, Mr. Chairman.

                TREATMENT ADVANCES FOR INOPERABLE TUMORS

    The gentlelady from New York is recognized for whatever 
questions she cares to pose.
    Mrs. Lowey. Thank you.
    Dr. Collins, the example you gave us of this woman with a 
growth on the lung is really extraordinary. And what I thought 
of immediately is every person who goes to the doctor with--
what I have heard in two cases--inoperable tumors in their 
lung, do they all get that test?
    Dr. Collins. That is a great question. And, in fact, one of 
the things we hope to achieve with the first stages of this 
Precision Medicine Initiative is to make that kind of 
experience much more available.
    Increasingly, individuals who develop cancer are having 
some kind of analysis done of the tumor to see what is driving 
it. Because we are developing a long list of reasons why good 
cells go bad and start growing when they shouldn't. And the 
ability to be able, in the individual to determine what is 
going on in that person and then connect that up with the 
appropriate choice of drugs, this targeted therapy approach, is 
extremely exciting.
    In fact, the National Cancer Institute has, for lung 
cancer, started such a protocol, called Lung-MAP, which aims to 
do that, in that case for squamous cell lung cancer, and 
another one for pediatric cancers and for adult cancers called 
MATCH.
    But, so far, the development of these approaches and the 
implementation across all of health care is not there yet, in 
part because we don't know quite enough to know what is the 
best strategy.
    The Precision Medicine Initiative, by expanding that effort 
in a very significant way, should make this kind of opportunity 
available to many more people with cancer. It should also teach 
us things about why it doesn't work when you think it should. I 
gave you a beautiful example of a remarkable cure, but we don't 
always see that. And we don't know why, when it doesn't work, 
something is responsible, or why, when it seems to have 
produced a remission, and then the disease comes roaring back a 
year later, what is that about. If we could understand the 
causes of relapse, that would help us.
    And another thing which the Precision Medicine Initiative 
will focus on is the opportunity to find out, could we combine 
more than one targeted therapy or perhaps combine a drug 
therapy with immunotherapy, which is extremely exciting right 
now, and have a higher likelihood not just of remission but of 
cure?
    All of those are ripe for investigation. This initiative 
aims to really turn up the heat in getting those kinds of 
answers.
    Mrs. Lowey. But it is still not widespread is what you are 
saying. I just recently had two friends who had inoperable lung 
cancer, and I just wondered if those tests were available to 
them. But you are saying it is not that widespread.
    Dr. Collins. Increasingly, they are, but I would certainly 
say to anybody who develops cancer at this point who is 
interested, go to clinicaltrials.gov, find out what trials are 
currently being conducted all over the country, many of them 
supported by NIH, find out whether you qualify for one of these 
studies that would include this kind of DNA analysis of the 
tumor and an opportunity to match that up with the available 
therapies.

            BREAKTHROUGH IN BREAST CANCER PRECISION MEDICINE

    Mrs. Lowey. I am particularly interested in how precision 
medicine, due to this initiative, could bolster treatment for 
breast cancer.
    We already know that white women are slightly more likely 
to develop breast cancer than African-American women. But for 
women under the age of 45, breast cancer is more common in 
African-American women than white women overall. These factors, 
likely evident in our genetic code, are why advances in 
precision medicine are so very vital.
    And I know there are many studies, because I was part of 
initiating them years ago with Senator Al D'Amato, on 
environmental factors. That never led to very much, frankly.
    So if you could share with us, what breakthroughs for 
breast cancer have we seen as a result of NIH-funded research? 
And how will the Precision Medicine Initiative improve the 
chance of finding a cure once and for all?
    Dr. Collins. Thanks for the question.
    Breast cancer, obviously, is an area of major priority for 
the National Cancer Institute. The ability to be able to look 
at thousands of breast cancers and see exactly what is 
happening at the molecular level has taught us that this is not 
just one disease; this is many different diseases, with 
different kinds of molecular pathways activated, comparing one 
person to the other.
    And, those have already led us to new insights about kinds 
of therapies that we didn't know about. Obviously, the 
discovery of genes BRCA1 and BRCA2 that play a major role in 
hereditary susceptibility is part of that, but we have a longer 
list now of hereditary risk factors than I would have thought 
possible 20 years ago.
    But, of course, what we really need is better means of 
prevention and early diagnosis and treatment. Put all of that 
together.
    Here is why I think, again, the Precision Medicine 
Initiative has a lot to offer. If, as we are claiming we can do 
starting next year, we could put together a cohort of a million 
or more individuals who are participants in a study that 
collects all of the data you could imagine about their medical 
experiences, about their DNA, about their environmental 
exposures, we might have sufficient power to really be able to 
get our hands on information that has been rather elusive about 
exactly what is the interaction between genes and environment 
that results in this disease or does not.
    Electronic health records now becoming the norm in many 
people's medical records is going to help that hugely. That is 
why this is the right time to initiate a program of this sort. 
We couldn't have probably done it 10 years ago, but now we can.
    Between electronic health records, environmental sensors, 
DNA analysis at an increasingly affordable cost, and the 
willingness of the public and the enthusiasm of the public to 
be part of a national effort of this sort, we could do 
something really groundbreaking and historic. And that is what 
this initiative aims to do for breast cancer and for many other 
diseases, as well.

                    SUPPORT FOR YOUNG INVESTIGATORS

    Mrs. Lowey. Well, I see the red light is on, Mr. Chairman, 
but I just have to tell you, this is why our investments in the 
NIH are so critical. I find the information we gather here so 
very exciting, and I am ready to double it again, as John 
Porter did. We could be groundbreaking here, Mr. Chairman.
    Thank you.
    Mr. Cole. I am very tough on the clock, except to my 
chairman and my ranking member of the full committee. So you 
take the time you need.
    Let me quickly, if I may, ask one question for myself, Dr. 
Collins. One of the areas that I know concerns you and 
certainly concerns me is simply the pipeline of talented young 
scientists and researchers.
    And I recognize and I think my colleagues have pointed out, 
when we are not as generous as we would all like to be in terms 
of our appropriations to this particular institute, you have 
fewer grants to award to younger researchers, and the success 
rate of applicants goes down.
    I was really made aware of this recently by a good friend 
of mine, Dr. Skorton, who is the president of Cornell but the 
incoming president of the Smithsonian. And I asked him why in 
the world was he leaving a wonderful place like Cornell, this 
capstone job--the Smithsonian is a great job--but, actually, 
the thing he said that concerned him in the future of science 
was exactly this. He said: I have some brilliantly talented 
young people, and, obviously, they enjoy teaching, but they 
want to research, they want to get things done. And we are not 
giving them the opportunities that they need to have, and that 
is going to cost us down the road.
    So I would like to know, number one, your assessment, but, 
number two, what are the things that we ought to do, what are 
the things you are doing now, to make sure that we engage the 
next generation of scientists that will hopefully match the 
accomplishments of this distinguished panel in their respective 
areas?
    Dr. Collins. Mr. Chairman, thank you for the question.
    This is the issue that wakes me up at night, when I try to 
contemplate the future of where biomedical research can go in 
the United States. We have such amazing scientific 
opportunities. Some of them, I am sure, we will continue to 
discuss during this hearing. But, yet, our most critical 
resource is not, you know, pieces of equipment or buildings; it 
is the people and particularly this next generation of 
researchers.
    They are full of ideas and vision, and yet they are finding 
themselves facing a situation that is the least supportive for 
that vision in 50 years. And they look ahead of them and see 
the more senior scientists struggling to keep their labs going 
and having rejection after rejection of grants that previously 
would have been supported, and they wonder, do we really want 
to sign up for that? And many of them, regrettably, are making 
the decision to walk away and to do something else.
    Meanwhile, the rest of the world, as has already been 
mentioned, is picking up steam, trying to be what America was 
20 years ago, even as we seem to have lost some of our 
momentum. And that is going to have really significant trickle 
effects downstream.
    So what are we doing? Again, there is no real magic here to 
solving what is a very difficult equation of supply and demand, 
where the demand for resources to do research is not currently 
being matched by the supply. But we are trying to adjust many 
of the things that we can adjust. And I have had many 
interesting conversations with people on this Subcommittee 
about this.
    One thing we are doing is to try to be sure that that first 
application from a new investigator gets a special effort to 
get funded beyond what would happen if they simply competed 
with people of larger experience. So, new investigators, early-
stage investigators, compete against each other, not against 
the experienced ones. That gives them a bump in terms of their 
likelihood of getting funded. And many of the institutes, 
actually, on top of that, give them an additional bump in terms 
of the likelihood of making the cut.
    That has helped to some degree. But, of course, we don't 
want to set people up for that first award to be successful and 
then, when they come back for a renewal or the second award, we 
lose them because the edge is no longer there.
    We are doing a number of other things. We are funding a 
program that provides support for post-doctoral fellows who are 
ready to go on in a couple of years to an independent position 
to compete for their award and then carry part of that award 
with them to an academic position, so-called K99 awards. And we 
are increasing the number of those, because that does seem to 
be a good mechanism.
    And a number of other things are being done to try to free 
up more of the proportion of funds for more applicants. I am 
going to quickly ask Dr. Lorsch, the Director of the National 
Institute of General Medical Sciences, is a major part, of our 
training initiatives, to say something about some of the ideas 
they are pursuing.
    Mr. Lorsch. Thank you, Dr. Collins.
    And thanks for the question, Chairman Cole. This is an area 
that we are very concerned about, as are you.
    We are starting a new pilot program called the Maximizing 
Investigators Research Award, which has as its fundamental goal 
to improve the efficiency of our funding mechanism, which would 
increase our ability to distribute funds, especially to young 
investigators.
    It would also have several other targets. One would be to 
improve the stability of funding for these investigators, 
because if they are constantly at risk of losing their funding, 
clearly, that is not an ideal situation. It would improve the 
flexibility for investigators to follow new research questions 
as they arise. Additionally, we think it would improve their 
ability to take on ambitious research projects and follow them 
in a creative manner. Nontheless, I think efficiency is the 
key.
    Mr. Cole. Thank you very much.
    I want to move next to my friend, the ranking member from 
Connecticut.

                 GENDER BALANCE IN PRECLINICAL RESEARCH

    Ms. DeLauro. Thank you, Mr. Chairman.
    And thank all of you.
    Mrs. Lowey and I just briefly talked to each other about 
how the level of discussion at the hearings with the NIH is 
inspiring. The intellectual pursuit, the science--gives you--
and that the United States is on the cutting edge of these 
efforts. It gives us such a sense of pride, but, more than 
that, again, it is what you are doing to push the edge of the 
envelope in so my directions, in terms of saving lives.
    And that leads us--we were both on the committee, Mr. 
Chairman, when we doubled the amount of money for the NIH, 
along with Mr. Porter, and it was so genuinely bipartisan. If 
there is an area in which we can come together and understand 
the value of what we have here, that I think it would serve us 
well to think through what we should do for the future.
    I am going to address an issue that you know has been of 
interest to me for a while, and I know it is for my colleague 
Mrs. Lowey, as well, and that is the gender balance in 
preclinical research. We have worked to make sure that women 
were represented among the subjects of biomedical research, 
including in the preclinical research studies.
    I don't have to tell you that men and women differ in their 
responses to medical treatments, and, oftentimes, using the 
models that rely exclusively on male animals can lead to 
serious harm. Women experience higher rates of adverse drug 
reactions than men do, for example.
    Dr. Collins, in May of 2014, you co-authored an article in 
Nature with Dr. Janine Clayton, Director of the Office of 
Research on Women's Health. You announced that NIH would 
require applicants to report their plans for the balance of 
male and female cells in animals in preclinical studies in all 
future applications. And that is the quote.
    You noted that the new policy would be rolled out in 
phases, beginning in October of 2014. Dr. Clayton noted that, 
quote, ``the exception will truly be the exception, not the 
rule,'' end quote.
    Let me just give you the two or three questions I have in 
this regard. If you can give us an update on NIH's new policy 
to require that both sexes be represented in preclinical 
research? What kinds of responses have you received from the 
research community? Are you seeing an immediate impact in 
applications for funding in fiscal 2015?
    Will you consider requiring the analysis of data by sex and 
other subgroup demographics as part of grant progress-
reporting? What are you doing to encourage journal editors to 
require an analysis of results by sex?
    How are you holding institute directors accountable for 
funding studies on sex differences and conditions that 
predominantly impact women? How are the institute directors 
accountable for partnering with the Office of Research on 
Women's Health on studies?
    And can we expect all future NIH-funded research to include 
both sexes unless there is a specific reason to not include 
them, such as a focus on ovarian cancer or prostate cancer?
    A lot of questions, I know, Dr. Collins, but I think it is 
imperative, this moment, because you are moving, and we need to 
make sure that we get all of this as we move forward. I know we 
have worked in the past and some things have not moved forward, 
and now, I think, is an opportunity for us to address the issue 
again.
    Dr. Collins. Ms. DeLauro, I appreciate the question and 
appreciate your leadership in bringing this to the attention of 
the public. And, certainly, I can assure you of my strong 
personal commitment to addressing this issue, as was documented 
in that article that you mentioned that I wrote with Dr. 
Clayton in Nature.
    The update is, we have now had extensive conversations with 
all of the institute directors, the scientific community and my 
Advisory Committee to the Director, which is my most senior 
advisory group, about this issue. There is generally broad 
embrace for the need in preclinical studies to include males 
and females unless there is a compelling reason. It needs to be 
explained, what it is, not just that it is not traditional or 
not convenient.
    The responses on the negative side have mostly reflected 
anxieties about whether this would mean that every study that 
previously studied only male mice, for instance, now has to be 
doubled in size in order to study males and females, and that 
will cost more and it will result in fewer studies being done. 
I think that is an unnecessarily negative response to this 
question.
    The idea that you should include males and females seems 
really compelling. The idea you should analyze the data 
separately is really compelling. You will have to decide in 
every study how subtle a difference between the sexes are you 
willing to miss, because that will determine how big your study 
has to be. But we know how to do that; that is called power 
analysis, and it can be applied in this situation quite 
handily.
    The Institute Directors, I think, are in the process now of 
finalizing their approval of the way in which we are going to 
implement this for NIH grantees, with much community input. So 
I can assure you, this will be something which is not left 
neglected. We will have definitive guidelines for all grantees 
who are doing these kinds of studies about what their 
expectations are.
    For reviewers who review these studies, it will be made 
very clear that that is part of how you are----
    Ms. DeLauro. Journal editors.
    Dr. Collins [continuing]. To review a grant that comes to 
NIH.
    Journal editors have been in conversation with us, and we 
have had great interactions with them about the general area of 
reproducibility. And this fits within that. If you have two 
studies that don't get the same answer but one studied males 
and one studied females, that is not called lack of 
reproducibility; that is called interesting new data that you 
would want to follow up on. So they are in this mix, as well.
    I think it is fair to say that the NIH is, across the 
board, fully committed to making these things happen. And it is 
time. It is over time.
    Ms. DeLauro. Thank you.
    And thank you for letting me go over time.
    Mr. Cole. Absolutely. Thank you.
    I want to go next to my good friend from Idaho, the 
distinguished Member.

             USE OF PRECISION MEDICINE IN COMMON CONDITIONS

    Mr. Simpson. Thank you, Mr. Chairman.
    And, Dr. Collins and all of the other directors, thank you 
for being here today.
    The bipartisan nature of this subject with this committee 
is pretty obvious and has been in the past, and that is good. 
It would be, I think, the desire of everyone on this committee 
to substantially increase the research we are doing if we 
didn't have an $18 trillion debt and a $500 billion deficit 
that we are having to deal with at the same time, which makes 
it more difficult. But, still, it is something that we put 
priority on and try to do in a bipartisan manner.
    I would like to ask you a whole bunch of different 
questions, but I am going to come out and visit with you for a 
day and take a tour of some of the different institutes and 
what goes on there, so we can get down and have some real good 
discussions.
    But there are a couple of things. This personalized 
medicine that you are talking about, or precision medicine, is 
fascinating to me. And I understand that OMNIX is the 
collective use of technologies, such as genomics and petro-
protein--protein medics--or something like that--that explore 
how cells and organisms are made up.
    As NIH--and I understand in your testimony you said you are 
going to concentrate on cancer right now. Obviously, it is a 
lethal disease and so forth. Is there any plans to look at 
broader, maybe not as lethal diseases or not as serious 
diseases and the effects that personalized medicine could have 
and the research in those arenas?
    Dr. Collins. Absolutely. Again, let me maybe be more clear 
than I was. The Precision Medicine Initiative has two 
components: An early focus on cancer because precision medicine 
is so ready for this kind of really expanded effort to 
understand what causes cancer, what we can do about it; but the 
other component, which is a long-term, ambitious, to be sure, 
effort is this cohort of a million or more Americans which we 
could be studying for virtually all diseases.
    And knowing that you are a dentist, I would certainly 
include, in that, such things as periodontal disease and dental 
caries. We know there is an environment and genetic risk 
involved in those conditions. But we haven't really had a 
sufficiently large study with appropriate patient participation 
to be able to get those answers. This should be a way to go 
there, this is true for diabetes, for heart disease, and for 
Alzheimer's disease. For virtually every common condition, with 
a million people, you are going to have enough events that you 
should really be able to disect what were with the biomarkers 
that warned this might happen; what were the environmental 
factors that played a role? We haven't had that kind of power 
before. We aim to get it.

                            UPDATE ON NCATS

    Mr. Simpson. That is fascinating stuff and could really 
advance the treatment of diseases and cure diseases. I am going 
to submit some questions for the record but the one I did want 
to ask is in our conversations in the past, you have indicated 
your strong support for the National Center for Advancing 
Translational Sciences, known as NCATS. I heard from some 
advocacy groups several years ago who expressed concern that 
putting more resources into NCATS might come at the expense of 
research. And I don't believe that to be the case. But you do 
request a $27 million increase for NCATS in fiscal year 2016. 
Can you update me on how things are going with NCATS and some 
of the benefits we have seen from this new center?
    Dr. Collins. I am happy to. NCATS, just 3 years old, was 
the first new center at NIH in quite a long time and was 
focused in trying to identify what are the bottlenecks in going 
from basic science discoveries to clinical benefits that NIH 
could address in collaboration with our partners in the private 
sector. I think initially there were some concerns that NIH is 
becoming a drug company. That really was never the plan and is 
not happening now.
    Instead, we are identifying areas of technology development 
that no single company could undertake, but working with them, 
we can. I will give you just one example. The effort to try to 
figure out when you are developing a new drugs whether it is 
going to be safe in humans or not has been a real difficult 
one. We use animal studies, small animals, large animals. It is 
not that accurate. It is slow. It is expensive. We probably 
lose drugs along the way because some mouse got a slight liver 
issue. And it probably would have had no relevance to humans, 
but we sort of lose the drug at that point.
    Wouldn't it be better to be able to test toxicity against 
humans cells but not put humans at risk? Now with the ability 
to create from a skin biopsy from you or me basically cells 
that represent liver or heart or brain or kidney or muscle on a 
three-dimensional biochip, we can begin to do those experiments 
without putting people at risk and get very interesting data 
about what drugs are likely to be safe or not at a much lower 
cost. We are doing this with FDA and DARPA. It is now 3 years 
along. NCATS, though, is the place where this lives. And it is 
a very appropriate thing. And pharmaceutical companies are 
wildly interested in this. Because if it works, it could 
greatly improve the likelihood of knowing whether something is 
safe before we get into an expensive clinical trial. I could go 
on with many other things that NCATS is doing. They are all 
quite innovative. They would not have happened without NIH 
stepping into this space. We have high hopes. There is high-
risk, but I think they are going to be high-reward.
    The other thing that is in NCATS now is all the CTSAs, the 
Clinical Translational Science Centers, which are present in 
many of your States, which is our network of 62 academically 
based centers that is where an awful lot of clinical research 
is being done.
    Mr. Simpson. Thank you all. Thanks for the work you do and 
look forward to coming out and visiting with you. And as I have 
said many years, and I will continue to say it, NIH is, for 
good or bad, the best kept secret in Washington, D.C., and the 
American people need to know what happens out there. Thank you.
    Dr. Collins. We would love to host you. Please come out.
    Mr. Cole. Thank you.
    All of us on this committee know that our good friend, the 
gentlelady from California, Ms. Lee, has been dealing with a 
difficult personal situation with the loss of her mother. And 
she has been in our thoughts and prayers.
    And it is wonderful to have you back here with us today. 
The gentlelady is recognized.

                       OVERVIEW OF NIH ACTIVITIES

    Ms. Lee. Thank you, Mr. Chairman.
    And let me thank all of you and you, Mr. Chairman, for your 
condolences and your support and your real expressions of 
sympathy during this very difficult period. And I am so glad to 
see everyone here today. And I want to thank you all of you for 
your work, for your efforts, really to save lives and to ensure 
the quality of life for everybody in our country. My mother was 
90 years old. She died of COPD, which is the--what--third 
largest death by disease in this country. And I have spent many 
a nights and many a days in emergency rooms and hospitals. 
Because of you and the work of NIH, she lived to be 90. She 
lived with COPD. And my sister has multiple sclerosis. And, 
again, because of you, this work, and this committee, my sister 
is 67 years old. And she is leading a very healthy life as a 
result of NIH and the research and the treatment. So I have to 
personally thank you all so much for the work that you do. And, 
of course, I want to see your budget doubled so that everybody 
can, first of all, be free of these diseases. And I wanted to 
ask you a couple questions with regard to COPD research in 
terms of prevention and new treatments. Also with regard to 
multiple sclerosis and your BRAIN Initiative, how that will 
impact people with MS. Sickle cell, you know, I have been 
working for many years now on looking at the A1C test as it 
relates to diabetes and the correlation between sickle cell 
traits and diabetes and the A1C test and see how that--are 
doctors and labs fully aware now that that could give a false 
positive, and what you are doing around that in terms of the 
research? Also, just in terms of your budget as it relates to 
HIV/AIDS, I am really pleased to see the increase. I want to 
see if you are coming up or if we are close to a vaccine; what 
types of new treatments do you envision with this increase of 
$52 million?
    And, finally, just as it relates to the National Institute 
on Minority Health and Disparity, really pleased, once again, 
to see an increase of $14 million in funding and want to look 
at how you are focusing on or looking at social determinates of 
health care because we know many of the health disparities in 
minority communities directly relate to the social determinates 
and how this is being framed and researched within the NIH. So, 
once again, personally, I just have to thank all of you.
    Thank you very much, Mr. Chairman, and members for your 
support during this period.
    Dr. Collins. Well, Ms. Lee, those are great questions and--
--
    Ms. Lee. I am going back to medical school now as a result 
of my family.

                             COPD RESEARCH

    Dr. Collins. Sure. Maybe I will ask Dr. Gibbons first to 
say something about COPD. And then we will try to work through 
as many of these as we can.
    Dr. Gibbons. Sure. As you mentioned, chronic obstructive 
pulmonary disease is the third leading cause of death in this 
country, one in which NHLBI has provided clinical trials that 
have provided a better course of life, particularly the 
nocturnal oxygen trial. But we need to do more. The challenge 
is that we often diagnose and treat the disease toward the 
latter stages. And a lot of the damage has already been done to 
a lung. It is primarily supportive. This is really an 
opportunity for precision medicine where we can diagnose and 
start to develop interventions earlier in the course to really 
prevent a lot of that deterioration that occurs.
    We are excited about the opportunities that come from 
genomic medicine. We are starting to understand the pathways 
that are promoting that inexorable progression of disease 
toward death. And we have some exciting opportunities to 
develop some new therapeutics in that regard, which is very 
exciting.

                      MULTIPLE SCLEROSIS RESEARCH

    Dr. Collins. And maybe I will ask Dr. Fauci to say 
something about a new trial on multiple sclerosis which his 
institute supported and, while he has the microphone, say 
something about HIV/AIDS.
    Dr. Fauci. Thank you, Dr. Collins.
    Thank you, Ms. Lee, for this question. As you are probably 
aware, just a few weeks ago, there was published a very 
exciting study, one of the most important studies we have seen 
in multiple sclerosis, in which 25 subjects were involved in a 
Phase 2, open-label study of stem cell transplantation in 
individuals who had rapidly aggressive, progressive multiple 
sclerosis. You would expect by historical control that these 
individuals over a period of months would have continued to 
deteriorate.
    The study was a resounding success. Greater than 80 percent 
of the individuals survived without any progression of their MS 
for a period of up to 3 years, which is really quite 
unprecedented. Now, it is important to note that this an open-
label study that was not controlled in the classic sense. But 
the historical control is so compelling because those patients, 
they almost invariably progress, and the patients in the study 
did not. We are very excited about it. And we are going to move 
on to the next phase of the study. I would say of all of the 
things we have been doing with multiple sclerosis over the last 
several years, in my mind, this is the most exciting.
    You also asked about HIV. There are so many important 
aspects of HIV, as you well know, throughout the world and in 
this country. We are seeing several countries approaching a 
tipping point, where the number of new infections are less than 
the number of people who are going onto therapy, to the point 
where we are starting to see a deflection in the number of HIV 
infected people. The things that would prevention and the 
treatment as prevention programs that you are very familiar 
with, in which you can decrease by 96 percent transmissibility 
from an infected to an uninfected person by, in fact, treating 
them and getting their viral load to below detectible level. 
There have been several studies that came out at the CROI 
meeting in Seattle last week that showed that preexposure 
prophylaxis of individuals at high risk, particularly men who 
have sex with men, superimposed upon treatment as prevention, 
has provided a substantial decrease in infection rate in 
certain areas.

                            VACCINE RESEARCH

    And, finally, with respect to the HIV vaccine issue, there 
are two major parallel pathways that are being pursued. One is 
the follow up of that very exciting, though modestly 
successful, Thai trial from several years ago that I reported 
to this committee, the RV144 trial, that was 34 percent 
effective--not enough to pursue this vaccine candidate but 
enough to give us some insight into the next stage of what we 
are going to pursue. We started a trial in Africa. And it looks 
like the response in Africans is quite similar to those in the 
Thais, which means that that is a hope of potential success in 
the African trial. And then there is a wide variety of research 
that is led by our Vaccine Research Center at the NIH, as well 
as a number of centers throughout the world, in looking at the 
ability to induce broadly neutralizing antibodies. These 
antibodies are difficult to induce with natural infection, but 
we are making headway in being able to induce them with the 
right immunogens. Thank you.
    Mr. Cole. Thank you.
    Dr. Collins, you can see your colleagues may be brilliant, 
but mine are very crafty at loading up questions. But they are 
great questions. They are great questions. And the chair is 
going to be as generous as he can with the clock.
    With that, I am going to move to my good friend, the 
distinguished member from Arkansas, Mr. Womack.

               COLLABORATION WITH CDC ON OPIOID ADDICTION

    Mr. Womack. I will try to be quick. I know I will use my 
time. I have got two or three questions. And I, too, was one of 
the people that went up on the tour. And thank you. I am in awe 
of the presentation that is being made here today, just as I 
was the day when we toured the National Institutes of Health. 
And I am grateful that you guys and gals are doing the great 
work you are doing. I want to follow up on the question from 
the overall chairman from earlier.
    When you said you need to make sure patients can access new 
medications and treatments coming out of the NIH to combat 
prescription drug abuse, I completely agree with that. But, 
right now, SAMSHA's regulations for medication therapy for 
opioid addiction prevent this and only push two medications, 
buprenorphine and methadone. Can you follow up on what the NIH 
is doing to make sure patients can access these medications? 
Are you working with other agencies, such as SAMHSA, to ensure 
they aren't detracting from but instead complementing the 
efforts of the NIH?
    Dr. Volkow. Yes, indeed. Thanks very much for your 
question. For us to succeed, we have to work in partnership 
with our sister agency, SAMHSA, so we have mechanisms by which 
we actually bring together the researchers and the clinicians 
to ensure that developments, in this case, in the area of 
medications for opioid addiction are implemented in the 
treatment setting.
    Having said that, there are always problems in terms of 
ensuring that the patients have access to these medications, 
and that is why I had made the point before, including the need 
to ensure that insurances will be covering and providing access 
to them.
    There is a third medication that is also available, 
Vivitrol, which was also developed through the NIH, with very 
good outcomes. And as of now, we know that not only are these 
medications effective in treating substance abuse, they are 
effective in preventing overdoses, and they are effective in 
preventing HIV. So they work. We need to implement them.

                              IDEA FUNDING

    Mr. Womack. Dr. Collins, you would expect that I am going 
to have a question about IDEA funding because Arkansas is one 
of those States that benefits. We have a lot of underserved 
population. And I know a lot of our applications go wanting. 
And we would like to improve that.
    We are pretty much a rural State, places like Dermott, 
Arkansas, Dr. Gibbons.
    In your fiscal year 2016 budget, you ask for a 3 percent 
increase over fiscal year 2015. However, the budget requests 
level funding of $273 million for the IDEA program. I would 
like to know why the program that helps States like mine--the 
other 22 States that help this secure this funding are not 
prioritized. Can you walk me through that process?
    Dr. Collins. NIH is the big fan of the IDEA program. And I 
appreciate your question. Certainly the things that have been 
accomplished through this program in States like Arkansas are 
truly exciting and a great opportunity for research and for 
training. In terms of the budget issue, there was a $50 million 
increment that the IDEA program received in 2011, which means 
that it actually over a 5-year period has grown more rapidly 
than the rest of NIH. This particular year did not change in 
its total dollars. But over that 5-year period, IDEA has been 
doing pretty well.
    I do want to ask Dr. Lorsch, because IDEA is now managed in 
NIGMS, to say something about this program, which I know he is 
also quite enthusiastic about.
    Mr. Lorsch. Thank you very much, Mr. Womack, for this 
question. As Dr. Collins said, the IDEA program is now housed 
within NIGMS. We are very proud to have it here and are 
completely committed to the goals of the program. I think the 
key is that whatever the budget, we are going to do whatever we 
can to make sure that those goals, that is increasing the 
geographic distribution and ensuring that all 50 States in the 
Union have cutting-edge biomedical research going on, are met. 
I recently traveled to Arkansas, to Little Rock, and saw some 
of the amazing research that is going on there and in the 
Southeast region of IDeA, including in your district, the 
University of Arkansas. We have a COBRE center there, a Center 
of Biomedical Research Excellence, that is focusing on 
determining the three-dimensional structures of proteins from 
viruses and bacteria and using that information to try to 
develop drugs to treat a variety of different diseases. What I 
can assure you is that we will continue to push the goals of 
this program forward as best we can.
    Mr. Womack. I know I am out of time. We will submit other 
questions for the record. Let me just finish by saying this--as 
I said in my opening, I am grateful for the work that is being 
done by this agency. And it gives me a great deal of pleasure 
to be associated with a panel of experts like we have here 
before us.
    Mr. Chairman, I yield back.
    Mr. Cole. Thank you, Mr. Womack.
    Next, we go to my good friend from Pennsylvania, Mr. 
Fattah.

         JOINT PROGRAM IN NEURODEGENERATIVE DISEASES INITIATIVE

    Mr. Fattah. Thank you, Mr. Chairman.
    And let me thank the panel. Let me ask first about the 
Joint Program in Neurodegenerative Diseases initiative the EU 
has created. They have participation from Canada and Israel. I 
know there have been some discussions about American 
participation. Could you tell the committee whether we plan on 
engaging in terms of broader clinical trials on degenerative 
diseases through JPND?
    Dr. Collins. Mr. Fattah, I really appreciate your strong 
leadership in the area of neuroscience. I am going to ask Dr. 
Insel, who is colead on our BRAIN Initiative and also a major 
figure in neuroscience at NIH, to respond to your question.
    Dr. Insel. Thanks very much.
    And thanks for all you are doing in this area. The JPND, 
this is the joint program that you talked about, is really an 
EU program. They reached out to us. What has evolved more 
recently is something that is going to be sitting under the G7 
authority around dementia more specifically. That is really the 
piece we have become most involved with. So we do have a series 
of joint meetings. I suspect, there will be some joint 
initiatives. That hasn't happened yet. But that is very much in 
the discussion. And we are looking forward to working closely 
with the other G7 partners around dementia.

                           PSYCHOSIS RESEARCH

    Mr. Fattah. Thank you very much.
    I know that Prime Minister Cameron initiated that. I met 
with Dr. Gillings from the World Dementia Council. But I would 
like to get a particular review of whether the JPND program is 
something we are or we are not going to join. And so you can 
provide that at some later point for the record.
    Dr. Insel. We will get that for the record.
    Mr. Fattah. Let me ask a question right in your alley while 
I have you. In the omnibus, we have put some additional dollars 
in for the SAMHSA mental health block grants and directed that 
SAMHSA work with your institute to help States implement 
programs that have proven effective in terms of preventing the 
first episode of psychosis. So I understand that in this way, 
research funds from your institute have come to be called 
RAISE, Recovery After Initial Schizophrenic Episode, and are 
being readily applied in communities so that patients are 
benefiting quickly from research findings. Can you tell us 
where we are right now and what the future holds?
    Dr. Insel. Sure. Thanks for that question. The RAISE 
program, Recovery After Initial Schizophrenic Episode, is a 
program that has been going on, actually originally really 
bolstered by the ARRA funding from 2009, 2010. The study was 
completed in terms of its feasibility in December of 2013. And 
this Committee saw fit soon thereafter, January of 2014, to ask 
SAMHSA to implement the findings of that study in all 50 
States. It is a most extraordinary story of science to service 
or science to practice. Usually, it takes many years. But, in 
this case, it happened in just 6 weeks in 2014. There are pilot 
programs that were developed in collaboration between NIH, 
SAMHSA, and all 50 States. We are watching that now as it 
continues to grow in 2015.
    What we would like to do now is to build on that in a very 
specific way. We want to be able to create a learning 
healthcare system out of these kinds of programs that would be 
really not so much research to practice but now practice to 
research, learning from the experience in where the care is 
being delivered, how to improve outcomes for people who have a 
first episode of psychosis, and, most importantly, how to 
prevent that first episode. So we are trying to actually move 
earlier in the cycle to make sure we reduce the number.

                          BRAIN BUDGET REQUEST

    Mr. Fattah. This has a great potential of preventing some 
of the tragedies we have seen around the country. And I know 
the committee will have a continuing interest as we go forward. 
Let me to 30,000 feet up in the air. I know you co-chaired the 
Interagency Working Group, which I established through language 
in the Commerce, Justice, Science bill, where I am the ranking 
member. Here I am in the junior chair. But the fact that I can 
just be in the same room with Tom Cole, I am happy.
    You co-chaired the working group, and the BRAIN Initiative 
is a major inspiration thereof. But there are a number of other 
things in terms of imaging, in terms of the pharmaceutical 
industry.
    I know that, Dr. Collins, you have launched the Accelerated 
Pharmaceutical Partnership. And there is just a lot of things 
that are germinating. If you could help us understand the 
budget requests, Dr. Collins or Dr. Insel, in terms of the 
BRAIN Initiative this year and how those dollars will be 
meaningful in terms of you moving forward, that would be 
helpful. Thank you.
    Dr. Insel. Sure. I will take that on. I should say at the 
beginning, that every time I go anywhere, I find out that 
Congressman Fattah has just been there--Stanford, MIT, you name 
it--at every neuroscience lab. I suspect you will get an 
honorary Ph.D. pretty soon in neuroscience.
    The BRAIN Initiative, when it was first set up, we asked a 
group or Dr. Collins asked a group of experts to sit down with 
us and to give us the best idea for how to develop this. And 
they created this 10-year plan, which is called BRAIN 2025: A 
scientific vision. And in that, there is a budget. And the 
budget will grow to roughly $400 million a year by 2019 and 
will, ultimately, over 12 years, be about $4.5 billion, pretty 
much like the human genome project. We are not there. So in 
2015, we will be around $80 million, with the President's 
request next year of another $70 million that will take us up. 
But I have to say that the question that gets asked of us over 
and over again, seeing how spectacular the scientific 
opportunities are, people look at that report and they say you 
have got a great road map, but is there any gas in the car? 
People are really concerned in the community that we have this 
opportunity that is unprecedented that may be underfunded. So, 
we are hoping that with the funds that we have got now, that we 
will be able to do 10 RFAs this year. We only did 58 projects 
last year. We would like to have another 50 or so come out this 
year. But going forward, whether we will be able to build this 
in the way that we had originally envisioned is going to depend 
a lot on your support.
    Mr. Fattah. Thank you, Mr. Chairman.
    There are tens of millions of Americans counting on your 
work in this regard.
    I thank the chairman.
    Mr. Cole. The gentleman's gracious compliment got him extra 
time. It may not get him extra money. We will have to see about 
that.
    We next go to my good friend, the gentleman from Tennessee, 
Mr. Fleischmann.

                 PEDIATRIC LOW-GRADE ASTROCYTOMA (PLGA)

    Mr. Fleischmann. Thank you, Mr. Chairman.
    And Dr. Collins and to all the Directors, I just want to 
say, thank you. You all fight the maladies that face so many 
millions of Americans. And your research and your commitment to 
medicine and science is incredible. So I thank you very much. 
As you all know, I have been a very vocal, outspoken advocate 
with the fight against cancer. I lost both my parents to 
cancer; my mother when I was very young. And I thank you for 
all your endeavors in that regard.
    But one of the particular sad things about cancer is 
children with cancer. And my question today, and I hope you can 
help me, a little boy came to see me. He was blind. He had had 
a brain tumor. And he and his dad came to see me and sat with 
me. I was not even his Congressman. I believe he lives in 
Maryland or Virginia. But I sat with him, and I spoke with him 
about his cancer. So I hope you can help me with this. 
Pediatric low-grade astrocytoma is a slow-growing children's 
brain cancer that impacts over 20,000 children every year. And 
there is over a thousand new cases, apparently, diagnosed every 
year. Existing treatments for PLGA brain cancer are invasive, 
highly toxic, and so far relatively ineffective. The treatments 
themselves can cause serious permanent damage and are often 
life-threatening. What research is being currently conducted by 
the NIH on PLGA? What treatments and therapeutic alternatives 
are on the horizon for PLGA patients? And are there any 
clinical trials currently being conducted by NIH for PLGA? I 
would really like to respond back to this little boy.
    Dr. Collins. Thank you for the question. Dr. Varmis, who is 
the director of NCI, is currently out of the country or he 
would be here and I am sure would be answering your question. 
But I will see what I can do. I agree with you, PLGA is one of 
those pediatric cancers that we desperately need better answers 
for. That it is slow-growing, it doesn't respond particularly 
well to the kind of approaches that attack cancers that are 
growing rapidly and that have made so many advances possible in 
pediatric cancers of other types. Clearly, there is a 
connection here between what we were discussing a little bit 
ago in terms of the cancer focus of the Precision Medicine 
Initiative. And as part of that, the Cancer Institute aims to 
enroll something like a thousand pediatric patients in this 
earlier stage of trying to understand what drives malignancy. 
And I would be very surprised if some of those are not, in 
fact, PLGA patients to try and understand more about the 
disease.
    Obviously, one of the very difficult problems is access to 
tissue here. Because it is not an easy thing to imagine just 
doing a biopsy of a tumor growing in such a vulnerable place. 
But there are potential ways that one can begin to look at that 
actually by looking at DNA that is floating around freely in 
the blood circulation. We are learning that cancers, because 
they do turn over, release their DNA. And one can discover it 
by looking in the circulation for free DNA that is not inside a 
cell, in a cancer, that may tell you what is going on without 
having to do a needle biopsy, a so-called liquid biopsy. That 
would be one area of focus.
    In terms of clinical trials for PLGA, I do not know right 
off the top of my head what is there. I am sure if I was 
looking, I would go to clinicaltrials.gov and see what is 
listed. I can certainly get for you for the record an 
indication of what kinds of trials are not only going on but 
what might be planned for this terribly difficult condition. 
And we share your concern about needing better answers for that 
boy who came to see you.
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    Mr. Fleischmann. Thank you, Doctor.
    I believe I have some additional time, so I will ask a 
follow-up question on something else.
    Dr. Collins. Please.

                         INTERNATIONAL RESEARCH

    Mr. Fleischmann. Our country prides itself on being at the 
forefront of research and development. And biomedical research 
is no exception. You have expressed some concern about the 
amount of money going toward international research. Could you 
please share with us why, with the budget the size of NIH's, 
you have these concerns? And let us know, in an effort to 
maintain American competitiveness, while working to make the 
largest strides possible to finding cures for the diseases that 
have the greatest impact in our population, what are you doing 
to take advantage of the research being done in other 
countries?
    Dr. Collins. That is a great question. Science is an 
international effort. And certainly many major programs, 
including the human genome project that I had the privilege of 
leading, was international. Six countries were involved in 
that. And all the data was made immediately accessible. But it 
is very clear that the country that leads in biomedical 
research enjoys other benefits rather directly, especially in 
terms of commercial spinoffs. And those are wonderful ways to 
create jobs. America's leadership has led to the fact that we 
are not only great in academic biomedical research; we also 
have the most vibrant community of small businesses, biotech 
companies, and pharmaceutical companies. We would not want to 
lose that benefit.
    And yet when you look at the trajectory that our funding is 
on compared to other countries, there are deep concerns. We 
have lost at the NIH about 22 percent of our purchasing power 
for biomedical research since 2003, a very substantial downturn 
in terms of what we can support. And other countries, on the 
other hand, are going the other way. China, in particular, 
increasing their support of biomedical research by 20 percent 
per year over multiple years.
    The consequences of that, I would refer you to an article 
by Economist Hamilton Moses in JAMA, which was just published 
about a month ago, has a lot of data in it, pointing out a 
number of things that are quite alarming if you really care 
about the U.S. Maintaining that leadership, including the fact 
that China is now filing more patents in biomedicine than the 
U.S., not just as a proportion of their GDP but absolutely more 
patents. And the consequences, I think you can imagine, are 
going to be significant.
    The final conclusion of this article, and I think this is a 
distinguished group that wrote this, is given the national 
trends, the United States will relinquish its historical 
international lead in biomedical research in the next decade, 
unless certain measures are undertaken. They see the pathway, 
and they don't like what is happening.
    We could turn this around. What NIH desperately needs and 
what would be such an inspirational moment for our community, 
especially those early stage investigators we were talking 
about, is a sense of stable trajectory, that we have a chance 
to be able to plan, to take risks, to do innovative research 
without the uncertainty about what will happen one year or the 
next. Maybe a doubling would be actually a nice thing. But what 
would be even better would be an opportunity to see a path 
forward that keeps up with inflation, plus a little bit, and 
that we could count on and that people could basically then 
flex their innovative muscles, and take advantage of this 
amazing talent that we have in this country.
    Mr. Fleischmann. Thank you, Dr. Collins, and everyone.
    Mr. Chairman, I yield back.
    Mr. Cole. Thank you very much. I now move to recognize my 
good friend, the gentlelady from California, Ms. Roybal-Allard.

                       NATIONAL CHILDREN'S STUDY

    Ms. Roybal-Allard. Thank you, Mr. Chairman.
    First of all, let me just associate myself with the 
comments that were made by my colleagues about the tremendous 
work that you all do and what a positive impact it has had on 
the quality of life of so many people, not just in this country 
but throughout the world.
    But I do have some concerns that I would like to address. 
Dr. Collins, in 2000, this Congress authorized the National 
Children's Study to investigate how the environment influences 
a child's development and health. And over the last 15 years, 
Congress has appropriated over $1.5 billion to plan and pilot 
this study. Given the huge investment, Congress fully expected 
that the study would be carried through to its completion. And, 
in fact, in almost every fiscal appropriations report from the 
year 2000 to 2014, there have been specific instructions from 
both the House and Senate directing the continuation of the 
study.
    And, in March of 2013, Congress requested a review of the 
revised study designed by the Institute of Medicine. And the 
IOM concluded that there were conceptual, methodological, and 
administrative challenges that must be addressed. But that the 
NCS still offered--and these are their words--``enormous 
potential.'' The IOM also concluded that when the study was 
completed, it would, and again I am quoting, add immeasurably 
to what we know about children's health in the United States.
    So after reading the IOM's summary report and given the 
billion and a half dollars that have been spent, I was frankly 
very, very surprised by your announcement canceling the 
National Children's Study. And I am sure I am not alone in 
believing that a better outcome for the $1.5 billion investment 
should be a completed study.
    So my question is by what authority did you use to disband 
the study whose authorization is still in current law and for 
which Congress has spent $1.5 billion over the last 15 years 
and for which this committee in fiscal year 2015 in the omnibus 
bill put in language that said, and I quote, the NIH Director 
is expected to use this framework, meaning the framework coming 
out of the IOM report, to ensure the mission and goals of the 
NCS are realized, to generate the anticipated returns from the 
years of taxpayer support. So I just would like an explanation 
as to what happened here.
    Dr. Collins. Well, I appreciate the question. And this has 
been one of the more difficult decisions since I have been NIH 
Director over the last almost 6 years. The National Children's 
Study was designed in various pieces over quite a long period 
of time. And I think, as that time passed, some of the design 
issues, in retrospect, maybe were not serving the need of 
getting the information, which we all agreed was crucial--that 
is, to understand environmental impact, factors that occur both 
during pregnancy and beyond that influence child health. We all 
agree, those answers need to be found. The problem that 
increasingly seemed clear was that the design of the Children's 
Study, which carried with it a certain historical legacy, was 
not fitting with the way in which technology was developing 
over the course of the last almost 20 years.
    The IOM study that you mentioned was, in fact, quite 
critical about those issues and about administrative issues. 
And because of that, I asked a working group of my advisory 
committee to look closely at all the aspects of the Children's 
Study and to make a recommendation to me about whether it was 
still feasible. They came back and said, frankly, they did not 
believe that it was and that it was more responsible at this 
point to try to make sure that the data that had been collected 
through the Vanguard Studies, which were the pilots for the 
Children's Study, were made available and kept in place for 
those who could learn from it, but that we really ought to 
think about coming up with a new strategy to get answers to 
these same questions.
    The Congress, in the omnibus bill, basically gave us the 
opportunity to take the $165 million that is in the fiscal year 
2015 budget and think of new ways that we could, in fact, 
obtain answers to these questions about environment in 
pediatric health. And we have been vigorously engaged in that 
effort over the course of the last 2 months and will in the 
very near future announce what the programs will be in fiscal 
year 2015, which I think you will find to be quite innovative. 
I believe the silver lining here is that this gives us a chance 
to step back from the legacy of the last 14 or 15 years and 
say, okay, now, in 2015, with all the technology that has 
advanced in the interim, what could we do that would get better 
answers perhaps for less cost than what was originally 
contemplated for a 21-year study? So look at the next things we 
put forward. We are quite excited about it. The Institutes have 
all gotten very engaged in this opportunity to rethink this. 
And, ultimately, I think we will get to where we need to be, 
but in a different way than was imaged back in 2000.
    Ms. Roybal-Allard. Okay. Because it is my understanding, 
according to a Bloomberg Business report, that Dean Baker, who 
was a researcher at the University of California, Irvine, who 
ran the pilot and was one of the lead investigators of the 
study, said that the IOM report, and I quote, that they did not 
conclude that the enterprise was beyond saving and that that 
was a decision by NIH. And we know a study of this nature is 
feasible and even identified a pathway. So that was a decision 
that was made by NIH, not based on the outcome of the IOM 
report. So just very quickly, I know my time is up, but what is 
the period of time and the amount of funding now that would be 
needed for NIH to address the recommendations that were made in 
June?
    Mr. Cole. I would ask the gentleman to be brief. Or if you 
care to take it, make a quick comment.
    Dr. Collins. Very quickly, just in terms of the process, if 
you read chapter 5 and chapter 6 of the IOM report--not always 
well reflected in the executive summary--it is actually very 
critical of some aspects of the study, my advisory group, led 
by Phil Pizzo, former dean at Stanford and a pediatrician, and 
a Russ Altman, a distinguished epidemiologist and computer 
scientist, came to a very strong and unanimous conclusion that 
the Children's Study was no longer feasible. I had to accept 
their conclusions because they were so well-founded. In terms 
of where we go, please look at the next proposals, which will 
be coming forward very shortly, about how we will address these 
issues. We do have a lot of things to talk about, though, I 
think, in terms of going forward, where should this kind of 
research go in the outyears. And we need to have that 
conversation.
    Ms. Roybal-Allard. I would like to follow up.
    And thank you, Mr. Chairman.
    Mr. Cole. You are welcome. Now I want to go to the one 
member on our team up here that might actually have the 
intellectual firepower to stay with your team down there, Dr. 
Collins.
    I recognize Dr. Harris.

                               DRUG ABUSE

    Mr. Harris. Thank you very much, Mr. Chairman.
    And thank you all for coming and appearing. First, I am 
just going to start with a rhetorical question first. Since the 
last time you were before this committee, you probably know my 
wife passed away from heart disease 3 days before her 58th 
birthday.
    As you also know, the NIH and in general we have really 
underfunded research into heart disease on women over the 
years. So I went back and looked at the chart by disease 
breakdown what the NIH spends on. And 84 million Americans have 
heart disease. And yet the amount we spend per death is 100 
times less on heart disease than it is on HIV/AIDS, 100 times 
less per death. That kind of discrepancy just needs to be 
justified. And this is going to be a rhetorical question. I 
mean, it is stunning what that discrepancy is. And the fact 
that we dedicate as little as we do to heart disease, the most 
prevalent disease in the country, you now, how that will affect 
the population. Anyway, rhetorical question on that one.
    Dr. Volkow, I am going to ask you a question about drug 
use. There is obviously ongoing discussion about legalizing a 
dangerous, addictive drug called marijuana. Some people may not 
think it is dangerous or addictive. It is dangerous or 
addictive. It affects the human brain, including memory, 
motivation, a lot of things that are probably not good for 
people, especially our youth. Do you know what the economic 
impact of marijuana use is, including its effect on workforce 
preparedness, on education? Do we have these answers? Are these 
important things to study? And do you have the resources to 
study these things before we go willy-nilly into just 
legalizing a dangerous, addictive drug?
    Dr. Volkow. Dr. Harris, thanks very much for your question. 
And, indeed, there have been many studies that have evaluated 
specifically the consequences of use of marijuana among 
teenagers vis--vis their educational achievement. And they have 
consistently shown that it actually decreases, smoking 
marijuana in adolescents, it decreases the likelihood that you 
will finish school and that you will get a degree.
    With respect to what is the impact in the workforce, the 
data there is much less clear. The studies have not been done 
as extensively as for education. We know in general that the 
use of drugs in the workforce is responsible for 30 percent 
less productivity on an individual that takes drugs. But that 
has not been distinguished with respect to whether it is 
marijuana or cocaine or methamphetamine. So we really do not 
have a precise number.
    Mr. Harris. And just a very quick follow up, you would 
imagine that since marijuana actually affects motivation, 
something that might be important when you go to work, you 
would imagine it might actually have quite an influence on the 
workforce, wouldn't you?
    Dr. Volkow. Yes, I would predict so. And what is shown is 
the contributions of the decreasing productivity, absenteeism, 
not showing; but when you are there, presenteeism, you are 
there, but you are not really working. And the same as the lack 
of motivation may account for the very poor outcomes in 
education.
    Mr. Harris. And we should probably answer these questions 
before we go on. I mean, we should expect scientific answers I 
imagine.
    Dr. Volkow. I completely agree.

            LEVERAGING OUR INVESTMENT IN BIOMEDICAL RESEARCH

    Mr. Harris. Dr. Collins, let me follow up with you, again, 
about some things that are being said about internationally 
what is going on and what is going on in our biomedical 
workforce. Again, the 50,000-foot view, because, you know, I 
think you actually sent something around, your article in JAMA, 
I guess, in January of this year, suggesting that perhaps China 
will actually overcome the United States in 2022, which, yes, I 
guess if you look statistically and you assume, you know, 
exponential growth continuing, things like that.
    But what is interesting is the growth in China is actually 
in the private investment, the industry investment. There is a 
little bit of growth in the public investment. But the real 
growth is in the private industry. And as you also noted, one 
worrisome trend in the United States is that the industry 
investment in biomedical has gone down. That is not your, that 
is not where you have the ability to directly impact, maybe, 
maybe you don't. But I think that that is an important key in 
this that we are not talking about. And there are certain 
policies that do impact that.
    For instance, we are undergoing aTTP negotiation where 
patent protection of American-manufactured biologics actually 
will be hindered. That doesn't help our biomedical industry 
here when we are negotiating a trade treaty that will actually 
hurt our biomedical industry because of the nature of 
biologics. What is the strategy? Because we can go on ad 
infinitum. You know, one interesting thing is the 
administration, in spending $35 billion additional dollars we 
don't have on nondiscretionary spending, decided to send only 
$1 billion to the NIH, only a 3 percent increase. I think that 
is a drop in the bucket if we don't get the larger picture of 
the entire biomedical research effort in the United States.
    So what can we do or what can you do at the NIH to 
implement a strategy where we can promote industry investment, 
so that you have partners in industry, so we are leveraging NIH 
dollars, greatly leveraging them, as it appears China is doing?
    Mr. Cole. Again, to be fair, try to be brief. And I would 
remind the questioners, let's not jamb them right up against 
the end of the time and then leave them hanging. That is a 
tough position to be put our guests in.
    Dr. Collins. Well, very quickly, I agree that we have a 
responsibility and an opportunity to bring together the public 
and the private sector investments in biomedical research like 
never before. One example is this Accelerated Medicines 
Partnership that I spent three years working with a number of 
heads of R&D in big pharmaceutical companies, particularly 
Michael Dolsten at Pfizer, to put together, and which is now 
with shared expenses being covered 50/50 by the private and 
public sectors, doing something never attempted before for 
Alzheimer's disease, for diabetes, for rheumatoid arthritis, 
and lupus, putting the scientists around the same table, 
designing the experiments, holding themselves accountable with 
milestones, and making all the data accessible to others who 
might have good ideas about it. This is unprecedented what AMP 
is trying to do. We are 1 year into this. We are ahead of 
schedule. I am looking for all those opportunities that I can 
find where those traditional firewalls that sort of got in the 
way of making progress weren't really making any sense. We have 
to be clear about conflicts of interest, and we are. But that 
shouldn't be a reason not to think about creative endeavors 
that fly in the face of such great opportunities that we now 
see in front of us.
    Mr. Harris. Thank you.
    Mr. Cole. Thank you very much.
    If I can, I am going to go to my very patient friend from 
Virginia, who was here early and has waited a long time, Mr. 
Rigell.

                 POST TRAUMATIC STRESS SYNDROME (PTSD)

    Mr. Rigell. Thank you, Chairman Cole.
    And I appreciate Dr. Collins and your colleagues being here 
today. And I am learning a tremendous amount. And I, too, 
respect the work that you are doing. I want to first frame this 
not as a question because I will get to a question, but I did 
take note of your comment about how helpful it would be to have 
confidence in continuity of funding. And I transitioned from 
House Armed Services to this committee. And I was struck in my 
service on that committee where our senior uniformed and 
civilian officials would say the same thing about just how 
beneficial it would be for us to be on regular order.
    I know Chairman Rogers and Chairman Cole and really all of 
us on the committee have been strong advocates for this. So I 
am going to continue to fight for that. And I know my 
colleagues will as well. But I just took note of what you said 
and I just wanted you to know that. I have an incredible 
district, highest concentration of men and women in uniform in 
the country, Virginia's Second Congressional District and, by 
the nature of the commands that are there, a disproportionate 
loss.
    So I want to talk for a moment about PTSD. Now, I know that 
there is some funding for it included in your budget, $79 
billion. And I believe it is to go to $81 billion, excuse me, 
million. I better get that right. Okay. All right. But my point 
is this, help me to understand--by the way, from the President 
on down to the First Lady, this is a shared American value. I 
do not question, I do not question for a moment anyone's 
commitment to this.
    That said, I didn't see it mentioned in your budget 
justification. And I know that the Department of Defense and 
also the VA is working on this as well. But help us to 
understand where this falls in the priority level. And is it 
getting the attention even within your own internal documents 
that I think it merits?
    Dr. Collins. I appreciate the question, Mr. Rigell. Let me 
ask Dr. Insel, who directs the Mental Health Institute, where 
PTSD research is particularly a strong priority, to respond.
    Dr. Insel. Very quickly because of the hour, our 
institute--NIMH--was actually founded in 1946 and charged in 
1949 to deal with the problems of veterans. So, this is 
something we have been at for a long time. It is part of the 
DNA of the institute to try to figure out what causes PTSD and 
how best to treat it and how to prevent it. We have been 
working really closely with DOD. And this is one of those areas 
we were just talking about regarding the relationships with 
industry. This one we have really taken on in a very joint way, 
especially with the Department of the Army. And so the Army and 
NIH have worked together on the Army STARRS Initiative, 100,000 
soldiers partnering with us to try to understand over time what 
causes not only PTSD but depression, high-risk behavior, and 
suicide, which is the worst outcome here. And I must say that 
having worked as closely with DOD as we have over the last 3 or 
4 years, it has been a great inspiration. That study has now 
just completed its first phase, moving into its second phase. 
Already I think we are getting some insights about both the 
cause and the best interventions to make sure that people who 
develop mental health problems don't go on to suicide.

                        ALLOCATION OF RESOURCES

    Mr. Rigell. The question of allocation generally, how much 
is allocated to one disease or a particular challenge that we 
face, Dr. Collins, could you help me to understand, especially 
when things need to be reallocated, because whatever your own 
experience has been, and we, like most American families, we 
have had loss due to Alzheimer's and cancer and things like 
this. But how is all that structured? Because I would like to 
see, you know, a higher allocation for the topic just 
mentioned, what our servicemembers are facing. How is that 
process unfolding?
    Dr. Collins. That is a question that many people ask, and 
they should. And it is an ongoing, organic process of looking 
at what is the public health need, what are the scientific 
opportunities, what does the current portfolio look like, and 
do we have gaps that we need to fill? And we are constantly 
doing that kind of analysis. We have more tools now than we 
used to, a whole series of ways that we can look at our 
portfolio and figure out whether we have the balance out of 
whack in terms of where our dollars are going and where the 
public health need is.
    But sometimes there are rare diseases that we could learn a 
lot from about common illnesses or which simply affect a few 
people who desperately need help. If we did everything on the 
basis of public health need, we would probably neglect the rare 
diseases. In other situations, Alzheimer's comes to mind, where 
the burden on individuals and their families and the cost to 
society is so daunting that we feel we have to push even harder 
as long as the scientific opportunities are there. So it is a 
constant sort of recalculation. And, of course, all of this 
would be easier if we were not in an circumstance where, 
frankly, we are underfunding virtually everything we do versus 
what we could be able to do given the talent that is out there.
    Mr. Rigell. Thank you for your comments.
    And I yield back. Thank you, Mr. Chairman.
    Mr. Cole. Thank you very much.
    Just for informational purposes, as my colleagues here know 
and as our witnesses know, we do have time constraints this 
morning.
    So I am going to go to Mr. Dent, so he has an opportunity 
to ask his questions. I will then go to Ms. DeLauro, so she can 
close us out of committee if that is all right with everybody.
    So, Mr. Dent, you are recognized.

                         LIVER CANCER RESEARCH

    Mr. Dent. Thank you, Mr. Chairman.
    And thank you all.
    And thank you for receiving us a few weeks ago at the NIH. 
It was a very interesting program, and I got a lot out of that. 
So thank you for that.
    And, Dr. Collins, I just wanted to mention that an analysis 
of the National Cancer Institute data, from 1975 to 2005, found 
that liver cancer incidents rates increased by more than 300 
percent, from 1.6 to 4.9 cases per 100,000 persons per year. In 
fact, liver cancer has seen the second largest annual percent 
increase in incidents of any cancer in the U.S. other than 
thyroid cancer. Historically, the survival rates in liver 
cancer have been pretty dismal. The 5-year survival rates of 
person diagnosed between 2003 and 2009 is only about 16 
percent. These survival rates are the second worst among all 
cancers, only slightly better than those for pancreatic cancer. 
And yet the NCI has no dedicated specialized program for 
research excellence on the liver or liver cancer project. Can 
you tell me why? And wouldn't this accelerate the pace of liver 
cancer discovery?
    Dr. Collins. I appreciate the question. Certainly liver 
cancer is a condition that many components of NCI are involved 
in working on. Whether there is a specific division focused to 
it, certainly there is attention to it. And, of course, liver 
cancer is particularly likely to appear in those who have been 
infected with hepatitis C, which is one of the great, wonderful 
success stories of the last few years, in terms of coming up 
with the therapeutic that can actually cure people with that 
disease and should, therefore, reap some rewards in terms of 
reduction of liver cancers downstream.
    Again, I will have to take for the record the opportunity 
to respond about the organizational part of NCI and liver 
cancer. And I can no doubt fill you in on where that work is 
going on and how it is being coordinated if that would be 
helpful.
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    Mr. Dent. That would be very helpful. Thank you.

            STATUS ON ANTIBIOTIC-RESISTANT BACTERIA RESEARCH

    And also this question to you also, Dr. Collins--and maybe 
Dr. Fauci wants to jump in on this one too--I recently met with 
CDC Director Dr. Frieden. And one of the issues we discussed 
were the recent fatal outbreaks of antibiotic-resistant 
bacteria across the country, including my home State of 
Pennsylvania. This threat posed by antibiotic-resistant 
bacteria, also referred to as superbugs, is so serious that, 
last September, President Obama issued an Executive order 
declaring that combatting superbugs is a national security 
priority. And, of course, superbugs are highly contagious, 
untreatable infection that spreads easily in the hospital 
setting particularly.
    And can you tell me if NIH is collaborating with the CDC to 
study, contain, and trying to find a treatment or cure to these 
antibiotic-resistant bacteria.
    Dr. Collins. Yes, intensively. But let me ask Dr. Fauci to 
say a word.
    Dr. Fauci. Thank you very much, Mr. Dent. We are very 
intensively involved in collaboration with the CDC, as you 
know, with the President's strategic plan and the Executive 
order or Combatting Antibiotic-Resistant Bacteria, or CARB. And 
the CARB program is a multi-agency U.S. Government program, 
involving the CDC, the FDA, the Department of Agriculture, HHS, 
and NIH. Our fundamental mission in that multi-agency approach 
is fundamental basic research to understand the pathogenesis, 
particularly now with the new high-throughput sequencing 
capability that we have to examine a wide array of quasispecies 
of microbes that are resistant. These developments have put us 
into a situation where we can do things that were really not 
imaginable years ago, where we are able to pinpoint the 
mechanism of resistance.
    Number two, we started a few years ago and have now 
amplified with the President's request of $100 million more for 
NIH antimicrobial resistance research in the 2016 budget, what 
we call an Antibiotic Resistance Leadership Group, or ARLG. The 
ARLG is part of our broad network of clinical trials to conduct 
studies that you can't do in a given individual institution 
because an incidence of one or two cases makes it very 
difficult to get good clinical data from just one institution. 
So we now are collaborating with the CDC on all aspects at the 
CARB program. They are doing mainly surveillance, and we are 
doing fundamental research.
    In addition and finally, we are developing vaccines for 
some of these very difficult microorganisms that are highly 
susceptible when you think in terms of people, for example, who 
have transplants or are immunosuppressed, not only Methicillin-
resistant Staphylococcus Aureus, or MRSA but some of the others 
such as CRE, or Carbapenem-Resistant Enterobacteriaceae. So the 
NIH, in summary, is very heavily involved in the CARB program 
in collaboration with the CDC.
    Mr. Dent. So you have a request for an additional $100 
million and that will be sufficient?
    Dr. Fauci. In the President's 2016 budget, there is a $100 
million request for antimicrobial resistance research at NIH.
    Mr. Dent. Thank you. I will submit the balance of my 
questions for the record. Thank you, Mr. Chairman.

                     ANTIBIOTIC-RESISTANT BACTERIA

    Ms. DeLauro. Thank you very much.
    And let me just follow up on my colleague Mr. Dent's 
questions on antibiotic-resistant bacteria.
    There is a significant increase in the budget. And can you 
take a moment to talk about Teixobactin as a new technique that 
has been discovered to deal with this?
    And, also, there is some misunderstanding of how long it is 
going to take to be able to use that. Can you give us an idea 
about how long--a timeline for the potential availability of--
and I don't know if I am pronouncing it right, but Teixobactin?
    And recently I was in Haiti, and I met a doctor who 
described the devastating effects of the antibiotic-resistant 
tuberculosis. Are there any drugs in the pipeline to treat 
drug-resistant TB?
    And, again, finally, I understand you are dealing with 
looking at a database for this effort, antibiotic-resistant 
infections, but there are many of them, to put it simply, in my 
simple language on this. But if the database was going to hold 
all genome sequence data for the 10 deadliest antibiotic-
resistant pathogens, what kind of an effort would that entail?
    Dr. Fauci. Three questions. I am going to do them quickly--
--
    Ms. DeLauro. I wanted to get you on--so talk about what is 
happening in Liberia.
    Dr. Fauci. All right. I will go quickly, Congresswoman.
    Ms. DeLauro. Please, Liberian ZMapp.
    Dr. Fauci. We will discuss that.
    Ms. DeLauro. All right.
    Dr. Fauci. Teixobactin. The NIH is very pleased with this 
because this was an entirely NIH-funded NIH effort, 
approximately $20 million, and we now have a new class of 
antibiotics that was developed from the soil.
    We have to be careful it is not going to be tomorrow or 
next month when teixobactin is going to available on the 
market, because we still need to do preclinical studies in 
animal models before we can get into human testing. I would 
like to say it is going to be around the corner, but it likely 
will be over a year before we think about clinical testing.
    The good news is that it is a brandnew concept for an 
antibiotic that essentially skirts the resistance mechanisms 
that other types of microbes use against common antibiotics. So 
it will likely be effective against microbes that are multidrug 
resistant. That is the good news.
    Tuberculosis, or TB, there is good news here also, because 
we partnered with drug companies, with several of them, 
particularly Johnson & Johnson, to develop now new drugs that 
are good against multiple- and extensively drug-resistant 
tuberculosis. We do have at least one or two drug candidates in 
the pipeline. If you had asked me that question last year, I 
would say we really don't have anything new.
    The sequence database--and this is something we do very 
well. We have phenomenal sequence capabilities now. We are 
going to be able to do that. In fact, that is one of the things 
that we put as a high priority, to use our technologies to get 
databases of essentially all of the various versions and 
iterations of antimicrobial-resistant microbes and be able to 
share them. And as we always do at NIH, it is always open 
access, so everything we do is open to the general public.

                              EBOLA TRIALS

    Ms. DeLauro. Ebola and the trials that have started in 
Liberia?
    Dr. Fauci. Right.
    Ms. DeLauro. And then ZMapp trials, as well.
    Dr. Fauci. Yes.
    Ebola vaccine trials started February 22 in Liberia in 
Monrovia. My deputy is there now overseeing the trials.
    We started off with a phase two trials for 600 individuals, 
where we will proceed slowly to make sure the vaccines are safe 
and immunogenic. And then, by the end we are going to go to the 
full total of 29,000 people.
    The vaccine that you mentioned either was developed by 
Nancy Sullivan in the Vaccine Research Center. It is being 
targeted together with the VSV vaccine, on which we 
collaborated, actually, with the Department of Defense, in a 
Phase 1 trial.
    So those two are ongoing. I mean, it is up and rolling.
    ZMapp is--again, ZMapp looked very favorable in animals. We 
don't know if it works in humans.
    We have started a comprehensive protocol that was announced 
3 days ago by the Ministry of Health in Liberia, actually, at 
the same time that the President of Liberia was meeting with 
our President here, right here in the United States. It started 
a few days ago. And the protocol is going to do is to compare 
standard of care--namely, intravenous replenishment of fluid--
against standard of care plus ZMapp.
    ZMapp is a cocktail of three separate antibodies directed 
against the Ebola virus. And, as I said, it looked very good in 
animals, but we need to prove definitively if it will work in 
humans.
    Both of those are NIH-driven trials, and both of them are 
ongoing in Liberia right now.
    Ms. DeLauro. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    Just, first of all, Dr. Collins, thank you very much and 
your colleagues for being here this morning. I have no doubt 
this is not only the most brilliant panel we will see all 
session, it is the most popular panel we will see all session 
long. So thank you very much.
    Ms. DeLauro. We need to have a group hug.
    
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                                          Wednesday, March 4, 2015.

                        DEPARTMENT OF EDUCATION

                                WITNESS

HON. ARNE DUNCAN, SECRETARY, DEPARTMENT OF EDUCATION

                        Introduction of Witness

    Mr. Cole. Good morning, Mr. Secretary. Good to have you 
here. And it is my pleasure to welcome you to the Subcommittee 
on Labor, HHS, and Education to present your budget request for 
fiscal year 2016 for the Department of Education. We are 
looking forward to hearing your testimony.

                   Opening Statement by Chairman Cole

    The education of America's children is critical not only to 
prepare them for the workforce, but to strengthen the economic 
health of our Nation as a whole. While the vast majority of 
funding and responsibility for public Pre K-12 education lies 
at the State and local level, the Federal Government plays a 
limited but important role in supporting educational 
opportunity for those students most in need, including students 
with disabilities and from low-income families. Similarly, the 
Department is a key partner with States and public and private 
institutions in making higher education more accessible and 
affordable.
    Providing for a high-quality education for all improves 
these students' employment prospects and allows the U.S. to 
maintain its international competitive edge. Therefore, it is 
essential that we conduct proper oversight of Federal education 
programs and ensure that we are using our resources in the most 
strategic and effective way.
    There are many things in your budget that I think we can 
all agree are priorities and that we can collectively support. 
There are others where we may disagree. The challenge facing 
this subcommittee is to support the most critical programs with 
the limited resources that will be available to us.
    I also sit on the Budget Committee--something, by the way, 
no appropriator really likes to do, you are generally forced to 
go for some unknown sin you have committed against the chairman 
at some point--but, anyway, I sit there. And the grim reality 
is that sequester is, indeed, the law of the land. It is not a 
policy or a choice. It is the law. I expect we will have to 
appropriate in accordance with this law because I am not 
convinced that we can get out of it by the time we mark up 
these bills.
    However, I continue to hope for a larger budget deal 
between Congress and the Administration so, hopefully, we can 
have a more realistic allocation when the time comes. Hopeful 
for a bigger deal, but the President, again, in my view, has to 
engage in some process, as does the Congressional leadership. 
Absent negotiations at a higher level, sequester is where we 
are at.
    We will have tough choices for every agency, and I think we 
need to start sitting down and talking sooner rather than 
later. I look forward to having a discussion with you this 
morning to identify your top priorities for the year so that we 
can invest American taxpayer dollars in the wisest way given 
our funding constraints.
    I would like to yield now to my ranking member, my good 
friend, the gentlelady from Connecticut, for whatever opening 
remarks she cares to make.

                Opening Remark by Ranking Member DeLauro

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    And welcome to you, Mr. Secretary. Thank you. You are here 
just before the snow hits. And God only knows, Washington will 
shut down.
    And good to see you, Mr. Skelly, as well. Thank you.
    Mr. Secretary, as you know, I share, and as I think you 
have just heard from the Chairman, we share your commitment to 
ensuring that all children have equal access to high-quality 
education. When I spoke on the House floor last week, I quoted 
Lyndon Johnson who said that, quote, ``Education is the only 
valid passport out of poverty.'' Decades later, he is still 
right. College graduates are less likely to find themselves 
unemployed. They earn on average 80 percent more than their 
peers without college degrees.
    I believe that the Federal Government has the 
responsibility to help everyone to gain access to a quality 
education, especially those from disadvantaged backgrounds. 
Children in high-poverty neighborhoods need our help the most. 
Kids in schools with fewer than 10 percent of students in 
poverty come first in the world in reading. Those in high-
poverty schools rank second from the bottom, between Chile and 
Mexico.

                ATTACKS ON FEDERAL SUPPORT FOR EDUCATION

    Helping those kids is exactly what Congress set out to do 
50 years ago when it passed the Elementary and Secondary 
Education Act (ESEA) and the Higher Education Act, two landmark 
laws that swung open the gates to the middle class for millions 
of poor children. But last week the majority introduced a bill 
that I believe threatens to throw it all away. The Student 
Success Act would, in effect, gut the ESEA and steal funding 
from the schools that need it most.
    And this is just the latest in a series of attacks on 
Federal support for education. Since 2010, setting aside Pell 
Grants, we have cut the Department of Education's budget by 
$6.4 billion, or 13 percent. That is after adjusting for 
inflation. We have also made shortsighted eligibility cuts to 
the Pell program. We have eliminated around 50 critical 
programs altogether, including programs that supported family 
literacy activities and student access to mental health. 
Funding for Title I, vital support to low-income kids, remains 
more than $100 million below pre-sequestration levels.
    The madness of sequestration has hit Labor, HHS programs 
funded by this committee especially hard. After adjusting for 
inflation, the Labor, HHS, Education bill has sustained cuts of 
almost $20 billion since 2010. These cuts could not have come 
for a worse time for America's children. The number of school-
age children living in poverty increased from 8.5 million in 
2010 to 11.1 million in 2014. Nearly three-quarters of States 
are providing less funding per student than they did in 2008.
    It is in this troubling context that we consider the 
President's budget proposal for 2016. Instead of making 
damaging cuts, we should be putting our resources into 
universal preschool, quality afterschool activities, and the 
training of good teachers. That is why I applaud this request 
for beginning to chart a path out of austerity. We still have a 
long way to go to meet our obligations to America's students, 
but I am pleased that the request includes a significant 
increase of $1 billion for Title I. It increases other vital 
formula grant programs that serve our most vulnerable children, 
including an additional $175 million to help educate kids with 
disabilities through Individual with Disabilities Act (IDEA) 
State grants.
    The President's budget also contains other welcome 
increases: $500 million to help States provide high-quality 
preschool to low-income children, $93 million for Promise 
Neighborhoods, a program to address the profoundly negative 
effects of poverty on learning, and $20 million for the Now is 
the Time initiative to help keep schools and communities safe, 
$13 million for physical education for our kids.
    So there is a lot of good in this budget. I don't agree 
with everything in it. I am disappointed that afterschool and 
summer school programs were only level funded. I believe they 
are critical in supporting learning beyond the school day. 
Similarly, I have wanted to see an increase for elementary and 
secondary school counseling.

                            HIGHER EDUCATION

    Turning to higher education, I strongly support the 
President's goal of improving access and completion and reining 
in college costs. We have to do better by our low-income 
college students. Only 9 percent of students in the bottom 
quarter of the income scale have earned a bachelor's degree by 
age 24. For those in the top quarter, the figure is more than 
eight times that.
    There is much to like in the President's request. Most 
importantly, I commend the proposal to ensure free community 
college tuition for responsible students. That would take us a 
long way toward equal access to higher education. I also 
support the increase for TRIO, which helps low-income first-
generation college students access and complete college. But I 
am concerned by the fact that most other higher education 
programs are only level funded.
    Overall, this budget request is a step in the right 
direction. These investments cannot happen unless we undue 
sequestration. In the meantime, as I have said repeatedly, 
sequester caps are damaging vital programs. All the while, we 
spend--and it is spending, and I will just briefly show this 
chart, Mr. Chairman--we spend close to $1.5 trillion every year 
on tax breaks. That is spending and loopholes and other tax 
expenditures. It is more than we spend on Social Security, 
Medicare, Medicaid, and defense discretionary spending.
    If we are to live up to our duty of providing every 
American with equal access to education, these tax expenditures 
must be on the table and we must be prepared to ask our 
wealthier citizens and our corporations to do more to support 
hard-working families.
    Mr. Secretary, thank you for your advocacy on these issues, 
and I look forward to your testimony.
    Thank you Mr. Chairman.
    Mr. Cole. Thank you.
    Mr. Secretary, your full statement will be entered into the 
record, and you are recognized for whatever opening remarks you 
care to make.

               Opening Statement of Secretary Arne Duncan

    Secretary Duncan. Thank you so much, Mr. Chairman, Ranking 
Member DeLauro, and members of the subcommittee. I am pleased 
to talk with you today about how we can continue the vital 
progress that America's students are making and expand 
opportunity so that every child in this country has access to a 
world-class education.

                   HIGH SCHOOL AND COLLEGE ENROLLMENT

    Here is what is happening right now thanks to the hard work 
and commitment of America's teachers, principals, students, and 
their families. For the first time ever, four out of five 
students are completing high school on time. Dropout rates are 
at historic lows after steep drops for minority students. With 
high school graduation rates up and dropout rates down, 
African-American and Hispanic college enrollment is up by more 
than a million students just since 2008. Finally, more students 
than ever are actually graduating from college.
    Getting to this point has required huge changes in our 
schools. These changes haven't been easy, but they are working. 
To build on this momentum, it is imperative that we give 
schools and educators the support and resources they need. This 
is not the time to turn back the clock on progress. There is 
simply too much at stake.
    Providing students with a quality education is both the 
best way to ensure more Americans achieve their greatest 
potential and the best way to promote and secure economic 
growth for our Nation as a whole. And we know that we can do 
more.

                       REVERSAL OF SEQUESTRATION

    At the end of 2013, policymakers came together on a 
bipartisan basis to partially reverse sequestration and to pay 
for higher discretionary funding levels with long-term reforms. 
This agreement, while limited, allowed us to invest in areas 
ranging from research and schools to strengthening our Nation's 
military.
    In education, Congress was able to restore some of the 
sequestration cuts to Title I and IDEA in 2014. The President's 
2016 budget builds on this progress by reversing sequestration 
and paying for it with a balanced mix of common sense spending 
cuts and by closing tax loopholes. The President's budget also 
proposes additional deficit reduction and would reduce debt as 
a share of the economy.
    The President has made clear that he will not accept a 
budget that locks in sequestration going forward, which would 
bring both defense and non-defense funding to their lowest 
levels in a decade. As the Joint Chiefs and others have 
outlined, that would damage our national security. It would 
also damage our economy in the near term and long term by 
preventing pro-growth investments in many areas, including 
efforts to ensure that all students are prepared for college 
and career.
    The reality today is that States and districts and families 
need more, smarter resources to prepare all students for the 
future. This isn't spending money for its own sake. It is about 
making prudent investments to expand opportunity and improve 
outcomes.

                      FY2016 EDUCATION PRIORITIES

    To that end, our 2016 budget reflects four main priorities. 
One, ensuring equity in opportunity for all students, including 
the $1 billion increase for Title I. Two, helping States expand 
high-quality early learning. Three, supporting educators, 
including by investing $2.3 billion to improve teacher and 
principal effectiveness. And four, improving access, 
affordability, and outcomes in postsecondary education, most 
notably through America's College Promise, which makes 2 years 
of community college free for responsible, hard-working 
students.
    Throughout all of these areas, we would commit to 
supporting and spreading locally developed innovations through 
programs like Investing in Innovation, the i3 program, and 
First in the World. We want to focus on using and developing 
evidence to maximize results both for taxpayers and for our 
Nation's students.
    Mr. Chairman, you and I have discussed the urgent need to 
do more in Native American communities. To that end, we have 
included $53 million in our budget to improve college and 
career readiness for Native youth, and we will continue to work 
with the Department of the Interior to expand the Bureau of 
Indian Education's capacity to provide desperately needed 
support.
    Since we released this budget, people from all over have 
written to us to explain what Federal support means for their 
communities and to describe the change that it made possible. 
One school leader explained how Federal funding allows her to 
give teachers the tools they need, helping them to incorporate 
evidenced-based approaches into their daily work. In her words, 
and I quote, ``Funding goes towards imparting the knowledge 
necessary for teachers to do their jobs the way it should be 
done.''
    But there is more to discover about what does work, and 
especially in our highest-need communities, teachers and 
students need more support to continue to accelerate the pace 
of change and progress. Our students' future is at stake and 
together we cannot let them down.
    I thank you so much, and I look forward to working with you 
to create more opportunities for our students and their 
families. I look forward to your questions now. Thank you, Mr. 
Chairman.
    Mr. Cole. Thank you very much, Mr. Secretary.
    [The prepared statement of Secretary Arne Duncan follows:]
    
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                          EFFECTS OF SEQUESTER

    Mr. Cole. Again, it is great to have you here.
    Interesting enough, as I reflect, all three of our comments 
focused a little bit on the whole issue of sequester, which is 
the elephant in every appropriator's room right now. But it is 
indeed the law, passed by Congress, signed by the President. I 
actually agree with you and my distinguished ranking member, I 
hope we have a negotiation some time to actually deal with it. 
I was actually part of the team that did that, working with Mr. 
Ryan on our side of the aisle, and had a very productive 
negotiation with Senator Murray. But that process came late. It 
came really after most of the Appropriations Subcommittees had 
been at work. But we were able to go back, as you rightly point 
out in your testimony, and undo some things that we all believe 
would have been damaging.
    I suspect the same thing will happen again. If it comes, it 
is likely to come late. I would encourage those above my pay 
grade and in the Administration above your pay grade to 
actually engage in that negotiation sooner rather than later. I 
think we would get a much better work product out of our 
various Appropriations Subcommittees if that happens. On the 
sad likelihood that it probably won't happen until the last 
minute, most things around here seem to, you know, for Congress 
deadlines are alarm clocks, so we are probably going to be 
there again.

                          EDUCATION PRIORITIES

    If you had to look at your budget and we were in a flat 
funding situation, what are the things from your standpoint you 
think really are the most critical? You lay out five priorities 
in your excellent statement. But pick some programs, pick some 
things in your view that are absolutely essential that this 
committee really ought to focus on no matter what.
    Secretary Duncan. Let me first back up again and appreciate 
your willingness to look at a bigger deal and to work together. 
On the idea of Congress always using deadlines as alarm clocks, 
I am always an optimist, and, hopefully, that could change and 
we could actually get ahead of the curve at some point.
    Mr. Cole. There are 200 years of history that would argue 
that you and I need to reconsider our optimism.
    Secretary Duncan. Next 200 years. I am always looking 
forward.
    Let me just say that if things remain flat, the need 
doesn't remain flat. We have more children living below the 
poverty line than ever before. Our Nation's school system for 
the first time ever this year is majority minority. That is not 
going to change. This isn't just doing the right thing for the 
black community or the Latino community. This is the right 
thing for our Nation. And as Congresswoman DeLauro pointed out, 
when you don't have enough poor children being successful 
academically, we perpetuate cycles of poverty and social 
failure rather than sort of increasing upward mobility.
    So there is increasing need. This is, obviously, a huge 
priority both for individuals and families, but ultimately for 
our Nation's economy. And as you all know so well, we are 
competing for jobs in a globally competitive world now, and 
those jobs will either go to your communities and your States 
and our Nation ultimately, or they will go to Singapore and 
South Korea and China and India and other places that are 
investing and innovating. So the stakes here are really, really 
high and I want folks to understand that. I think we have to 
educate our way to a better economy.
    In terms of priorities, I tried to lay out what was very 
important. I say everywhere that if I had one tax dollar, the 
best investment we can make is in high-quality early learning, 
getting our babies off to a good start and stop playing catch-
up. We have to continue to raise the bar on the K to 12 side, 
making sure that young people are truly graduating college-and-
career ready.
    We love that high school graduation rates are at an all-
time high, and dropout rates are at an all-time low. But I am 
nowhere near satisfied. Our dropout rate is still unacceptably 
high. Again, when you drop out of high school today there are 
no good opportunities out there.
    Then, ultimately, the goal today can't simply be to 
graduate from high school. There aren't good jobs with just a 
high school diploma. I think this idea of a minimum of 
community college being the expectation, the norm, is hugely 
important.

                        PRE-K THROUGH 14 SYSTEM

    The final thing I would say, Mr. Chairman, is I think for 
the past 100 years or so the K to 12 system has worked pretty 
well for the country and for most families. I think the world 
has changed and our vision is a pre-K through 14 system of 
compulsory education--not of compulsory, but of opportunity. 
Without that, our children start too far behind and we don't 
catch up on the front end. On the back end, without those 2 
years of community college, the job prospects are very low.
    So it is a fundamentally different vision of what the 
necessary education, the prerequisite for success is, and it 
has to go, I think, from pre-K through 14.

                    INVESTING IN COMMUNITY COLLEGES

    Mr. Cole. Let me ask you this, and I don't have a lot of 
time left so I am going to try and force the clock, so we may 
come back to this issue. But on your community college issue, I 
share your concern about getting people beyond high school and 
getting them into a higher education program. Community college 
is actually fairly reasonably priced in this country compared 
to 4-year institutions. I think the average cost is a little 
bit over $3,000 a year. We have Pell Grants to cover that and 
can go beyond that.
    I am a little mystified why that is the focus of so much 
resources, as opposed to bringing down the longer-term cost of 
a more extensive education, because it seems to me we are more 
or less adequately funded. But if you disagree, please knock my 
theory down.
    Secretary Duncan. Well, no, these are really thoughtful 
questions. I think there are two things. I think the reality is 
financially, while it does not seem that overwhelming, just a 
couple hundred dollars here and there literally is the 
difference between staying in school or not, whether it is 
taking care of kids at home or whether it is a car breaking 
down. The margin for error is so small for so many of our 
families that are on the edge.
    Some of my most inspiring visits have been to community 
colleges. I travel the country, and, as you know, it is not 
just 18-year-olds, it is 38-year-olds, it is 58-year-olds who 
are retraining and retooling. The jobs where they worked for 25 
years, at the plant or factory, are gone. The fields of green 
energy and IT and health care and advanced manufacturing are 
where I see great community colleges have become regional 
economic engines. They are literally driving economic activity 
and growth in their communities.
    This is not our idea. It actually came from Governor Bill 
Haslam of Tennessee, of whom I am a huge fan. What he saw in 
their first year, my numbers are not exact, and you will 
probably have better numbers, they are thinking they might have 
25,000 applicants and they had something like 75,000 or 90,000 
to apply which is wildly disproportionate.
    So it is important on both the financial side, but also 
psychologically for young people to understand that this is a 
possibility, that despite my family's lack of money or despite 
my family's lack of education this can be my dream. And so, on 
both sides making that the norm, rather than something for 
wealthy folks is very important.
    Mr. Cole. We may explore that a little bit more. I 
appreciate very much that answer. And with that, I want to go 
to my ranking member, Ms. DeLauro.

                            TAX EXPENDITURES

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    I just want to make one comment, but I am going to give Mr. 
Fattah his time and he can take some of mine. He has to chair a 
hearing in a moment. But my one comment is, I too believe that 
if we can get to a consensus on the spending issues and take a 
look at where we need to go with regard to sequester, I think 
the chart, it is not one that I made up, this is a CBO 
projection, this is 2015. These are the tax expenditures, $1.5 
trillion Social Security, Medicare, defense, discretionary 
spending, and non-defense discretionary spending. If we are 
unwilling to look at those tax expenditures in terms of cuts 
and the corporate loopholes and do something on this side of 
the equation and not regard it as spending, we are not going to 
be able to come to a consensus, which I think it is imperative 
for us to do.
    With that, Mr. Chairman, Mr. Fattah.

                  MAKING 2 YEARS OF COLLEGE ACCESSIBLE

    Mr. Fattah. Thank you. I have to help lead a CJS hearing in 
a few minutes. But, Mr. Secretary, all of this for us as a 
country is an aspirational thing. When we allowed States to 
make submissions to join the Union, each were required a long, 
long time ago to lay out a plan for free education. So the 
fundamental building blocks of our Nation was built on the 
notion that we were going to produce educated citizens. And you 
have done an extraordinary amount of work in this regard. I 
want to congratulate you.
    I was out in the Chairman's district years ago at a center 
at a university there called the K20 Center in Oklahoma, and it 
is an aspirational deal. It is about pointing young people, not 
about K to 12, but about college and graduate school. They were 
doing some remarkable work. I am sure the Chairman would 
remember, they were building some of these games that these 
young people love to play, but building into them messages 
around educational achievement.
    I think when the Administration says free college 
education, the way I look at it, and I am a big supporter of 
it, is that you are really saying the same way we have made 
high school a part of the social contract, you now want to make 
2 years of college part of the social contract. And when we are 
competing with China, which is going to have 280 million 
college graduates, and they have built 100 science-only 
universities, they are seriously focused on our economic 
competition. They are competing against us. Even small 
countries, like Singapore, are in many ways competing with us 
every day.
    So I think that when we talk about this as a budget item, 
we have to see it as whether we want America to remain number 
one in the world. And if we do, these kids in the shadows, they 
have to be moved and given an opportunity.
    So I want to thank you. I am sorry I can't stay for the 
whole hearing. But we will be working together. And I do 
appreciate the support for GEAR UP. I authored the law that 
created GEAR UP years ago in a Republican majority Congress and 
Senate. And, I thank my Republican colleagues. It was 
bipartisan from day one. It has helped 13 million young people 
to prepare themselves and to go on to school after high school. 
So thank you.
    And thank you to my ranking member.
    Mr. Cole. Care to make a response to any of that?
    Secretary Duncan. Amen.
    Mr. Cole. Amen? Okay. Pretty good.
    Okay. With that, I will go to Mr. Simpson.
    Mr. Simpson. Thank you, Mr. Chairman.
    And thanks for being here, Secretary. It is good to see you 
again now that I am back on the committee.
    First, let me ask you, I know it is here somewhere, you 
mentioned that since you had released your budget that you had 
phone calls from all of the country about the importance of the 
Federal Government and Federal contributions to delivering the 
services and education and so forth.

                        IMPACT AID LEVEL FUNDED

    Let me ask you about one in particular. Impact Aid is 
important in Idaho, as well as most western states that have 
public lands. Those dollars go to support school districts that 
don't have the tax base to keep their schools running. As you 
know, your budget is a $3.6 billion increase over last year, 
including increases for early childhood, teacher quality, 
community college initiatives. However, not a penny to increase 
Impact Aid.
    It is kind of frustrating to many western states that have 
tax-exempt Federal property, military bases, or Indian lands, 
not only because the Administration touted the importance of 
Impact Aid when funds were being cut via sequestration, but 
because Impact Aid is the Federal Government's obligation. As 
you know, these funds could be and are in some cases used for 
the very initiatives the Administration prioritizes. Can you 
please explain the reasoning behind your decision to level fund 
Impact Aid?
    Secretary Duncan. I will turn to Tom Skelly in a minute. 
But, first of all, I appreciate your interest and your 
commitment. As I have visited military communities, it is so 
interesting to find that the folks who are serving their 
country and veterans never ask for anything for themselves. All 
they ask is we do a good job with their kids. I think that is 
the least we can do for them.
    We want to continue to keep this program strong. We want to 
continue to invest. You are right, we are level funding. But 
the commitment and the importance of that work is 
extraordinarily high on my list of priorities. I want you to 
know how much that means to me.
    Tom, Do you want to talk through the specifics on that?
    Mr. Skelly. Impact Aid is important and is level funded, as 
are many of our programs. There wasn't room to increase 
everything, even at the increased level that the President is 
proposing above the sequester limits. In the past couple 
budgets, we did propose a decrease in Impact Aid. So in 
relationship to the past couple years' budgets, it is an 
improvement for Impact Aid.
    Mr. Simpson. Well, it is interesting to note that when 
sequestration was the law of the land and we were trying to 
write budgets to sequestration numbers before the Murray-Ryan 
budget deal, one of the things you all touted that would be 
impacted would be Impact Aid, and, boy, we can't do that. So 
now that when we are proposing a $3.6 billion increase, Impact 
Aid is just kind of left on the table as it is.
    Mr. Skelly. We talked about that Impact Aid reduction from 
the sequester when it was very immediate. Impact Aid is a 
current-funded program and the funds go to the school districts 
that have a high need for it. The impact of the cut is 
immediate. In the budget where we are proposing to remove the 
sequester caps, we think there wouldn't be as much of a need to 
be worried about that immediate impact.

                     TRIO-STUDENT SUPPORT SERVICES

    Mr. Simpson. Well, we will have a discussion on all this as 
we put together a budget I am sure.
    One other question that I would like to get into. In fiscal 
year 2015, the Department completely mishandled the TRIO 
Student Support Services competition. This included a late 
release of the initial grant application, followed by a 
reissued application that prioritized experimental competitive 
preferences over actual student needs. Ultimately, this 
committee, along with our counterparts in the Senate, added 
language to the Cromnibus to ensure timely handling of the 
competition.
    What assurances can you give me that the Department will 
meet the statutorily established deadline of August 10, 2015, 
for delivering notification of the results of the Student 
Support Services grant competition? Additionally, how will the 
Department avoid similar missteps in the upcoming competitions 
for TRIO's Talent Search and Educational Opportunity Centers 
during fiscal year 2016?
    Secretary Duncan. I disagree a little bit with the 
characterization, but that is fine. Hold me accountable. We try 
to do a really good job of managing a large agency. We don't do 
it perfectly. We are always trying to do better. And where we 
don't do things as well as we would like, we try to improve. 
And so hold me personally accountable for making sure we do a 
good job there and in all our competitions going forward.
    Mr. Simpson. Do you support TRIO?
    Secretary Duncan. Absolutely. It is a fantastic program. We 
are asking for a budget increase there.
    Mr. Simpson. And the reason I ask that is in the last 
Administration the Secretary kept coming up, telling us that 
TRIO wasn't a successful program, and they consequently tried 
to blend it in with a whole bunch of other grant programs and 
everything else like that, which we resisted.
    Secretary Duncan. No, again, we are asking for an increase. 
But to be clear, for TRIO, like every other program, we are 
holding ourselves accountable and asking what is the evidence 
that we are having a real effect and how do we continue to 
improve. TRIO is a great program, but we try never to be 
satisfied. We try to always be self-critical and look in the 
mirror on where we can get better outcomes and where we can 
have an even bigger impact on the students who need the 
support. We want to challenge ourselves to get better every 
year, not just to do the same thing.
    Mr. Simpson. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.
    If we can, we will return now to our ranking member, who 
was generous to give up her time to Mr. Fattah.
    Ms. DeLauro. Thank you very much, Mr. Chairman. I want to 
associate myself with my colleague, Mr. Simpson's remarks both 
on TRIO, but also on Impact Aid, because not only the west, but 
the east coast is reliant on that funding as well.

                      TEACHER QUALITY AND TRAINING

    Mr. Secretary, this is an issue that I know you know that I 
have been interested in. The Congress temporarily extended a 
provision in the continuing resolution to allow teachers who 
are participating in an alternative route to certification be 
labeled as highly qualified for purposes of complying with No 
Child Left Behind. We know that of all the school-related 
factors, teachers matter the most. Unfortunately, the research 
shows that these teachers-in-training are less effective than 
those who enter the teaching profession fully prepared. They 
are also inequitably distributed, primarily assigned to low-
income and minority students.
    To shine a light on the issue, Congress also required the 
Department to submit a report by the end of 2013 on the extent 
to which students in four subgroups--students with 
disabilities, English learners, students in rural areas, and 
students from low-income families--are taught by these 
teachers-in-waiting. To date, the Congress has not yet received 
a final report. What work has the Department done to provide 
Congress with this critical information? When will we receive 
the report? And let us know about what you have done to make 
sure that the information from all of the States is included in 
this.
    Secretary Duncan. Yes. We have been a little frustrated by 
this, as have you, and we would love to have gotten this report 
out a while ago. We have five States--I have looked around, I 
don't think it is any of you guys, and Mr. Fattah left, so I am 
not going to fuss with you about it--but there are five States 
where we haven't received data, frankly. They are Texas, 
California, Mississippi, Pennsylvania, and North Carolina. And 
those five States account for almost half the Nation's teachers 
with alternative certification.
    I was pushing to just put the report out, but the Coalition 
for Teaching Quality asked us to wait a little longer, to see 
if we could get this data in and be more comprehensive. I am 
hoping we do. We will have to figure out if the data is not 
forthcoming what our action is.
    Ms. DeLauro. What will we do? The information, when is it 
going to get to you.
    Secretary Duncan. They pushed me and I listened and agreed, 
to wait a couple more weeks. So we will see if it is 
forthcoming shortly. If it is not, we have got to figure out 
what we do to move forward. And I apologize.
    Ms. DeLauro. Okay. So as soon as we can, it would be 
useful.
    Secretary Duncan. It is overdue, and we try not to have 
things be overdue.

                           ABILITY-TO-BENEFIT

    Ms. DeLauro. I will just mention this, but my hope is, that 
what we will do is have the opportunity to get a briefing from 
all of you. This is on higher education, the Ability-to-
Benefit. That is an area that we addressed in the Omnibus. What 
we want to do is to look at how the Department is dealing with 
implementing the change, how will the information be shared 
with financial aid advisers at community colleges, how will 
students be notified that they are now eligible for Pell 
Grants?
    Secretary Duncan. We are working on it. Mr. Skelly can walk 
you through the detail on where we are on that.
    Mr. Skelly. We have an internal working group.
    Ms. DeLauro. And I understand that you will come in and 
brief us on this effort and my staff on this effort as well. So 
I am appreciative of that.
    Mr. Skelly. Be glad to do that.
    Secretary Duncan. What is the time on that?
    Mr. Skelly. It is over the next couple months. It is about 
2,000 students, not a lot of students, who will benefit from 
the Career Pathways Program.
    Ms. DeLauro. But it is critical. We were very glad to be 
able to restore that Ability-to-Benefit to those youngsters. So 
we will keep in touch on that issue.

                          FOR-PROFIT COLLEGES

    Let me just mention for-profit colleges and the 90/10 rule 
if I can. I strongly applaud the Department's effort to protect 
students from debt, worthless degrees, and looking at this 
area. For the record, the schools enroll just one out of eight 
students, receive 1 out of every 5 dollars spent on Federal 
financial aid, account for almost one out of two student loan 
defaults. The budget proposes the needed reform to protect 
students, and especially veterans, by closing down that 90/10 
loophole.
    So I am supportive of the Department's efforts. I think it 
is unconscionable that we continue to subsidize an industry 
with taxpayer dollars that leaves students, and especially 
veterans, with high debt and no degree. I want to know some 
more about what your proposed reforms are. If I can just, and 
maybe I will have to come back to this, I saw this information 
that is recruiting documents from for-profit colleges. And this 
is entitled ``Emotion.''
    ``We deal with people that live in the moment and for the 
moment. Their decision to start, stay in school, or quit school 
is based more on emotion than logic. Pain is the greater 
motivator in the short term.'' The profiles of people they look 
for are welfare moms with kids, pregnant ladies, recently 
divorced, people with low self-esteem. And the list goes on. 
This is a boondoggle.
    When you come back on the next round, when we have a 
question, and I applaud the reform, I want to know how this is 
going to work, because we are shortchanging so many of our 
students because of the money that these colleges are getting. 
And it should stop.
    Mr. Cole. Go next to the gentleman from Tennessee, Mr. 
Fleischmann.
    Mr. Fleischmann. Thank you, Mr. Chairman.
    Good morning, Mr. Secretary. Good to see you.
    Good morning, Mr. Skelly.

                    AMERICAN TECHNICAL TRAINING FUND

    As you all know, I represent the Third District of 
Tennessee. It is a wonderful east Tennessee district. I know 
the Secretary has been in many times and I thank you for that, 
sir. Great, hard-working people. My constituents and I are 
steadfastly committed to workforce development. I hear from 
employers all the time that we need more skilled workers.
    Mr. Secretary, as you know, the skilled trades are the 
hardest jobs to fill in the United States. Recent data cites 
that 550,000 jobs are open in the trade, transportation, and 
utility sectors and 246,000 jobs open in manufacturing. Career 
and technical education, we would know it as CTE programs, 
assist businesses in closing the skills gap by educating and 
training a competitive workforce to fulfill these 21st century 
demands.
    In the Career and Technical Education State Grant program 
the Department makes formula grants to States to support these 
activities. This year, your budget proposes an increase of $200 
million for a new American Technical Training Fund, ATTF, 
within the CTE Innovation Fund. Through this new fund, the 
Department would make grant awards to institutions of higher 
education, local educational agencies serving high school 
students or non-accredited training employers, workforce 
investment boards, and economic development agencies.
    Mr. Secretary, I have two questions, sir. Could you please 
tell us more about the American Technical Training Fund and why 
the Department didn't propose to put the funding in the formula 
grant to allow States more flexibility? And my second question, 
can you explain the quantitative criteria used to measure 
success and efficiency of these programs, sir?
    Secretary Duncan. I am going to get to that in 1 second. 
First of all, I just want to commend Tennessee for the 
improvements your State has made. And, again, I wish Congress 
could work in a more bipartisan way, in the way we have worked 
with many governors. As you know, your Governor is a strong 
Republican, Governor Haslam. But he has done an amazing job and 
has been an amazing partner.
    Tennessee on an absolute basis has a long way to go, but 
Tennessee, by every measure, is the fastest improving State in 
the Nation. And that is not easy. It is hard. There is pushback 
every single day. But we have been thrilled with the leadership 
and courage coming out of there and thrilled that we have been 
able to be a small part of that success and try to support 
that.
    On CTE--and I will have Tom sort of walk through the 
technical side--first of all, I am just a huge fan of voc-ed, 
CTE, there are lots of different names for it. We need better 
programs at the high school level. I think many students drop 
out of high school not because it is too hard, but because it 
is too easy and they don't understand the relevance of what 
they are doing in school to the real world. I think we need to 
do a better job of introducing these students to potential 
careers that are high wage, to high skill programs in middle 
school and give the students a sense of what is going on.
    We have tried to partner very closely with the Department 
of Labor with the Trade Adjustment Assistance Community College 
and Career Training, TAACCCT, grants for community colleges and 
really, again, making sure that real training is leading to 
real jobs. Some high schools do an amazing job of this, where 
real training, has real application to jobs in their community. 
In other places it is a little outdated, frankly, where they 
are training young people for jobs that disappeared a while 
ago. So we are always trying to spur innovation. We are always 
trying to look for evidence of what is working.
    In terms of what we look for in terms of metrics, where is 
there employer demand in the local community? Where are 
employers helping to shape what is going on there? I would love 
to see all high school students graduate not just with a high 
school diploma, but with some AP credits or early college or 
industry certification, and with a high school diploma being 
like a baseline, but not as far as we can go.
    So Tom is going to walk through the specifics of what we 
are funding and why. But we are trying to increase resources. 
We are trying to drive innovation. We want to make sure real 
training at the high school and the college level, community 
college level, are leading to real, in-demand jobs in local 
communities.
    Mr. Skelly. The $200 million increase, Mr. Congressman, for 
the American Technical Training Fund would be a competitive 
program. The CTE program provides formula grants to States. The 
idea is we would have a competition and award somewhere between 
20 and 60 individual awards to partnerships of colleges, 
businesses, others in the area who are aware of what are the 
high-demand fields. There would be job training opportunities 
for people at those individual sites.
    Again, competitive versus formula, we have a lot of 
discussion about that. A competitive grant would target funds 
more directly to just the projects that are doing the work 
under the American Technical Training Fund. A formula grant 
program tends to disperse money out more broadly, so it is 
thinner. The idea is to concentrate funds on just a couple of 
projects.
    Mr. Fleischmann. Thank you very much. And I sincerely look 
forward to working with you all on this workforce development 
issue because I think it is not only great for my great State 
of Tennessee, but for the Nation.
    With that, Mr. Chairman, I yield back.
    Mr. Cole. Thank you very much.
    I know my friend from Maryland, Mr. Harris, is trying to 
juggle getting back and forth between various committee 
assignments. Normally, it would be Mr. Rigell. But if it is all 
right with my friend, we will go with Mr. Harris next.
    Mr. Harris. Thank you very much.

             DEPARTMENT OF EDUCATION DISCRETIONARY SPENDING

    And thank you, Mr. Secretary, for appearing before the 
committee.
    And you can get back to me on this, but on page 2 of your 
testimony you talk about our spending not adjusting for 
inflation, being less than fiscal year 2008. Well, first of 
all, you exclude Pell Grants. Pell Grants are part of the 
discretionary funding in the Department. I mean, that is a 
priority decision, right? The Department has a budget, it 
decides where its priorities are. So with Pell Grants, that 
statement is not true, is that right?
    Mr. Skelly. That is right. If you include Pell Grants, 
since 2008 it would be slight--but it would be an increase.
    Mr. Harris. A slight increase? $59 billion to $67 billion 
is a slight increase?
    Mr. Skelly. When we do the adjustment for inflation----
    Mr. Harris. No, my question was not adjusted for inflation, 
because that is what it says here, without adjustment for 
inflation. So that is absolutely not true, without adjustment 
for inflation, is that correct?
    Now, my figures for fiscal year 2008 actually, without Pell 
Grants, is 42.9. This year was 44.6. Now, this may be new math. 
But not adjusting for inflation, that is actually an increase.
    So could you just get back to me about the correctness of 
your testimony, top of page 2? Rhetorical question, you are 
going to need to answer for the record, because I have other 
questions. Just go over your math. And maybe we need more 
Common Core or something. I don't know. But the math doesn't 
work out. It is not true.
    Mr. Skelly. I will share the numbers with you.
    [The information follows:]
    
    
 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]   
    
    
    Mr. Harris. It is just plain not true, what your testimony 
was.

                  D.C. OPPORTUNITY SCHOLARSHIP PROGRAM

    Let's talk about the D.C. Opportunity Scholarship Program, 
because that is my annual question to you. Is it a success or 
not?
    Secretary Duncan. The results from the evaluation that was 
conducted a couple years ago is mixed, and it is largely 
similar to the results we have seen in other places. My sense 
is that test scores are relatively flat compared to those who 
had Opportunity Scholarships versus the control group. 
Graduation rates were up some.
    Mr. Harris. Okay. Graduation rates were up some? Ninety-one 
percent versus 70 percent? Mr. Secretary, that is your idea of 
graduation rates up some? That is pretty dramatic, isn't it?
    Secretary Duncan. I don't have the numbers front of me. I 
thought it was 10 percent.
    Mr. Harris. Dr. Patrick Wolf conducted the study for your 
Department.
    Secretary Duncan. Okay. That is fine. As I was saying, 
graduation rates are up. Parental satisfaction was good.
    Mr. Harris. Well, how the heck do you measure success? If 
graduation rates are up 30 percent and parental satisfaction is 
good, what is your yardstick for success? I mean, aren't we 
here to serve constituents and to serve the children, get their 
graduation rates up?
    So let me ask you, do you intend to ask somewhere--because 
we can't find any money in the budget to provide these 
Opportunity Scholarships for new students. I don't think it 
exists, does it?
    Secretary Duncan. No, the money does exist.
    Mr. Skelly. It is not before this subcommittee. It is with 
Financial Services.
    Mr. Harris. And there is a request for new scholarship 
money before Financial Services?
    Secretary Duncan. There is an annual appropriation that 
goes both for that and for traditional D.C. Public schools and 
for charter schools. There are three different buckets there.
    Mr. Harris. Okay. So your testimony today is that before 
the Financial Services there actually is an administration 
request for new scholarships, not continuation, new 
scholarships?
    Secretary Duncan. There are additional dollars in the 
budget.
    Mr. Harris. Mr. Secretary, very clearly, I am not talking 
about administration costs, I am not talking about evaluation 
costs. I am talking about actually parents getting to have 
their children take advantage of D.C. Opportunity Scholarships, 
new scholarships.
    Secretary Duncan. Yes.
    Mr. Harris. I am very happy and to relieved to hear that 
there are new ones.
    Now, you have an RFP for a new administration, I believe, 
is that right, to manage the program, for a new grantee to 
manage the program?
    Mr. Skelly. A new grant, right.
    Mr. Harris. That is right. And the application is due by 
April 24. The deadline for intergovernmental review June 23. 
Getting pretty close to the end of the year. Are you pretty 
convinced your new manager is going to be able to have a smooth 
transition for the next year?
    Mr. Skelly. There will be a year where they overlap. So 
there should be no problem with that.
    Mr. Harris. Excellent. Because I think that is a great 
program and I don't want to shortchange it.

                             COLLEGE RATING

    Now, my final question is about higher education and the 
desire in the Department to rate our Nation's colleges and 
universities. And I don't know what criteria you are going to 
use, but I will tell you, I have a daughter who went to college 
and decided 1 year into it that she wanted to major in 
theology. I don't think she is going to make a whole a lot of 
money. I don't think she is going to have a great job based on 
a major in theology.
    So if you use a criteria of what someone earns when they 
are done or what their balance is of what they earn versus what 
their scholarships are, I might find that she actually didn't 
go to a college that was worth very much because of the major 
she chose.
    Allay my fears that we are not going to use criteria that 
supersede the ability of a parent and a student to decide which 
college is best for their child based on what they feel is a 
good college, not what the Department of Education feels is a 
good college.
    Secretary Duncan. Obviously, we want parents to choose the 
right college for their child or older adults to come back to 
school for a whole host of reasons. What I think, Congressman, 
is that there has been a huge lack of transparency. There has 
been a lack of ability to navigate an extraordinarily difficult 
situation--what is a grant, what is a loan, what are the 
graduation rates? I am a sociology major who has tried to work 
in public service all my life. We love teachers. We love Peace 
Corps members. And we will do nothing that would sort of 
provide disincentives for folks to do the public service work 
that all of us are committed to.
    Having said that, we think there is a whole series of 
information that would be great for young people and their 
families to have. We want to make sure that folks have a chance 
to make a living wage and not come out broke and no job 
prospects and huge default rates on loans.
    And so this is complex. It is hard. But we think, given our 
collective investment of close to $175 billion each year to 
provide access to higher education, virtually all of that is 
based upon inputs, almost none of that is based upon outcomes. 
I don't think that is as wise as we should be with scarce 
taxpayer dollars.
    Mr. Harris. Well, my only comment, and I will close, Mr. 
Chairman, is I worry when the Department defines what a good 
outcome is, because they might not define a theology major 
degree as a good outcome. I will leave it at that.
    Thank you very much.
    Mr. Skelly. About D.C. Choice, we don't have a request for 
new dollars in the budget this year. It is carryover money that 
is available. So no additional funds were needed.
    Ms. DeLauro. Is that in Financial Services?
    Mr. Skelly. Financial Services.
    Mr. Harris. Thank you very much, Mr. Chairman. Yield back.
    Mr. Cole. To the patient and long-suffering Mr. Rigell.
    Mr. Rigell. I think there are some advantages to being on 
the end. I always have these nice introductory comments from 
the chair.
    Mr. Cole. I am sorry, I am sorry----
    Mr. Rigell. I will defer again, gladly.
    Mr. Cole. I am sorry, I didn't see you come in.
    Mr. Rigell. No. I am really fine, if the chairman wants to 
follow order. So please.
    Mr. Cole. I thought I was losing control there in the last 
exchange a little bit. So we are going to reassert regular 
order, if we may. But under regular order, Ms. Roybal-Allard 
is, indeed, next. So the gentlelady is recognized.

           ACHIEVEMENT THROUGH TECHNOLOGY AND INNOVATION ACT

    Ms. Roybal-Allard. Thank you, Mr. Chairman.
    Secretary Duncan, as the author of the Achievement Through 
Technology and Innovation Act, which is better known as the 
ATTAIN Act, I have been advocating for Federal investments in 
digital learning since about 2007. The ATTAIN Act would provide 
education technology resources to underserved schools and would 
train teachers to effectively use that technology to prepare 
underperforming students for today's competitive workforce.
    So I was very pleased to see that the President's budget 
request includes $200 million for Educational Technology State 
Grants. This money, as you know, is needed to complement the 
FCC's recent $1.5 billion increase in the E-Rate program, which 
will ensure that all schools have adequate broadband and wi-fi. 
Unfortunately, the ESEA reauthorization does not include the 
dedicated funding through the education technology.
    For the record, could you please elaborate on why this 
dedicated funding for digital learning, specifically 
professional development for teachers on how to use that 
technology, is so important, not only to the individual, but 
especially to the future of our country? Because I witnessed in 
my own district where the hardware was there, but it was just 
sitting there because the teachers did not receive the training 
that they needed to effectively use that hardware.
    Secretary Duncan. Let me come at this a couple different 
ways. And you mentioned it, and it is important for folks here 
to understand, the FCC's investment in E-Rate is a huge, huge, 
huge step in the right direction. Technology can drive equity. 
Technology can drive excellence. But where you have unequal 
access to technology, it actually exacerbates the divide 
between the haves and the have-nots, the digital divide. And 
with the FCC's investment, over the next couple years, whether 
it is in Native American communities or rural communities or 
inner-city LA, children who have not had access historically to 
high-speed broadband are going to get it. And this is I think 
really a game-changer, this is extraordinarily important.
    So, first, I just want to thank the FCC for understanding 
the potential power here. Children, wherever they live, should 
be able to learn anything, anytime, anywhere, and the chance to 
take advanced placement classes, the chance to learn a foreign 
language, the chance to have access to things that may not be 
in your school, in your community, again, just literally opens 
up a new world of opportunity. So we are very, very excited 
about where this can go.
    It is empowering to teachers. It engages students in their 
own learning. We are asking for the $200 million, to answer 
your question directly. Sometimes our students are a little bit 
ahead of our teachers, and we want to make sure teachers have 
access to the training they need to make sure technology is 
really driving instruction and making a difference in the 
classroom. We think, there is huge potential here, but we want 
to make sure it is used wisely, thoughtfully, and the teachers 
are learning from each other. I think so much of this good 
professional development is not listening to some outside 
expert coming into a hotel ballroom, but it is teachers working 
with other teachers and working with their principals.
    Ms. Roybal-Allard. I just want to emphasize the point that 
this is also important to the future of our country. We are not 
just talking about the individual students and the importance 
of them learning, but in terms of the future of our country.
    Secretary Duncan. Well, if young people don't have these 
skills and exposure to these careers we do grave damage to them 
and to our Nation. And, again, if we don't take this seriously, 
I promise you other countries are.
    Ms. Roybal-Allard. Yes, they are. Definitely.

               EFFECT OF PROPOSED PORTABILITY PROVISIONS

    Last week the House debated H.R. 5 to reauthorize the 
Elementary and Secondary Education Act, and one of the 
provisions in that bill would allow States to implement Title I 
portability. My understanding is that it would shift 
significant amounts of funds from high-poverty schools and 
school districts to wealthier schools and districts with much 
more lower levels of poverty. The Los Angeles Unified School 
District, our Nation's second-largest school district, would 
lose over $80 million if portability is implemented.
    Can you explain in more detail why portability harms high-
poverty school districts like LAUSD, including which school 
services would be impacted by portability?
    Secretary Duncan. First, the administration has been 
extraordinarily clear that we could not begin to support H.R. 
5. And, again, it is not too late for the House to work in a 
bipartisan way to fix No Child Left Behind. No Child Left 
Behind is broken, it is outdated, it needs to be fixed, but it 
needs to be about policy, not about politics. Any time it is 
simply about politics we are not really thinking about kids.
    There are lots of educational challenges that we can all 
agree on and talk about the best ways to solve. What I have not 
had is a clear answer, frankly, from anyone on what education 
problem we are solving by taking money from poor kids and poor 
communities and poor districts and moving that money to more 
affluent districts. In many communities those more affluent 
districts are already better funded on a per-pupil basis. So a 
sort of reverse Robin Hood thing just simply doesn't make any 
sense to me.
    And, again, I just would love someone to tell me what 
problem they think they are solving. What is Title I money 
supposed to do? It is supposed to give poor children a real 
chance in life. And we go back to what Congresswoman DeLauro 
talked about, while we are seeing some improvements, far too 
few children who start out below the poverty line end up 
graduating from college. So what is the ultimate goal? To give 
them the skills, the knowledge, the ability to not just 
graduate from high school, but go on to some form of higher 
education.
    Ms. Roybal-Allard. Thank you. I see my time is up.
    Mr. Cole. It really is your turn, Mr. Rigell.
    Mr. Rigell. Here we go. Okay. Thank you so much, Mr. 
Chairman.
    Secretary Duncan. Does he get any extra time?
    Mr. Cole. If he needs it, yes, sir.
    Mr. Rigell. I appreciate that.
    Secretary Duncan, thank you, both of you, for being here 
this morning. We appreciate it.

                      STEWARDSHIP OF PUBLIC FUNDS

    Mr. Secretary, I read carefully your statement, and I 
realize that it is just a cursory overview of a very large 
department, a lot of funds are flowing through it. But I was 
struck by something. I didn't do a search on the document, but 
the two words ``increase'' and ``increasing,'' those words are 
just all throughout, more funding, more funding.
    We are all so often put in these boxes, that Republicans 
don't support this and our Democratic friends support something 
else or education, for example. But we know--we know--that this 
is a shared value, it really is, the next generation of 
Americans. But I would also say that there is another shared 
value, and that is stewardship, just how we are using the 
funds.

                         PELL GRANTS AND FRAUD

    I want to call attention to one thing in particular, Pell 
Grants. Let me first say they are essential, they are helping a 
lot of young people, and, I guess, some middle-age folks too 
perhaps that need help. But it is a good program. But I want to 
call your attention to something, that is the fraud and the 
abuse that is in this program. And I want you to know, these 
are not talking points from Heritage, they are not coming from 
some Tea Party organization. I want you to know who brought 
this to my attention and said, please, look into this. And I 
use this with her permission.
    Dr. Terry Sullivan, the president of the University of 
Virginia, walked me through a few years ago just how bad it is. 
And I said, Dr. Sullivan, is it okay with you, this is very 
powerful and it is troubling to me, and is it okay if I 
reference you publicly? And she said yes. And we have looked 
into it. And I don't have all the stats here today. It has been 
a really busy week. But there is abuse in the program.
    The way I look at it, and we have talked about this on 
other things as well, someone who is misusing this is stealing 
from the American people and indirectly, but in a very real 
way, taking away from someone who does need the support because 
we are in such a tight budgetary environment.
    I need to give you some time to respond to all this. But 
this is something I am going to remain focused on in my service 
on this fine committee. I think it is constructive. It is done 
for the right reasons. But please let us know.
    I would actually like, in the future, just blend in some 
wording that lets all Americans, not one party or another, but 
all Americans know that you are looking out for every dollar, 
to make sure that the support is getting to those who need it 
and it is not getting to those who are going to steal from us.
    Secretary Duncan. I think your point is extraordinarily 
well taken. And please know how seriously my team and I take 
our role as trying to be good stewards of scarce taxpayer 
dollars.
    We actually have in the budget proposal resources to 
continue to challenge where there is fraud. I can give you the 
weekly report I get from our Inspector General of folks that we 
lock up for fraud rings and other things around Pell and other 
areas, not just limited to Pell.
    So we take that extraordinarily seriously. We could lay out 
for you what we have done, what our budget proposal is, what we 
have done to put people in jail who have chosen to do the wrong 
thing. Every single day we try and use scarce tax dollars 
wisely.
    To your point, for me, these are not competing values. We 
should be working as hard as we can there, and we should 
support hardworking Americans who desperately need to go back 
to school full-time. These values are not in competition and 
actually reinforce each other.
    So know how seriously we take that responsibility. Know 
what we have tried to do. And if there are concrete suggestions 
of things that we could do better than we have, we are more 
than open. None of us have any interest in seeing scarce 
dollars being used by folks who are perpetuating fraud.
    Mr. Rigell. Thank you.
    And some of the best advice I was given when I got up here 
is, ``Look, there is so much going on. Become an expert on just 
a few topics and then kind of stay on it.''
    And, Mr. Chairman, absent maybe you directing me in some 
other direction, I am going to stay on this and we are going to 
work on it on the staff level.

                PUBLIC-PRIVATE PARTNERSHIPS IN EDUCATION

    Let me transition just for a moment in the little bit of 
time we have left and maybe a second round, if time permits, to 
talk about something so positive and I just think is just a 
real jewel within the educational system, and that is 
Achievable Dream in Newport News, Virginia. You have actually 
been there in 2009 with Congressman Scott. This was life-
changing for me, really, in my view of education.
    Time does not permit me to describe it to all who are here 
in the room, but it is a public-private partnership that is 
having remarkable results in taking our children who are most 
at risk and guiding them all the way through high school to 
have a remarkable outcome on the other side.
    And, again, we will probably have to follow this up over 
time. But help me to understand what programs--or how does the 
Department view these public-private partnerships and 
organizational--educational opportunities like Achievable 
Dream?
    Secretary Duncan. Do I have time to try and answer?
    Mr. Cole. You certainly can. We were pretty----
    Mr. Rigell. Your time, Mr. Chairman.
    Mr. Cole. If you can satisfy Mr. Rigell, go right ahead.
    Secretary Duncan. Very quickly, what I saw there was 
extraordinary. It is not unique. I see amazing schools beating 
the odds all over the country as I travel. And there are lots 
of people who want to tell you that somehow poor kids can't 
learn or black and brown kids can't learn, and schools like 
that put the lie to that myth and that stereotype every single 
day.
    So we have tried to do a lot to incentivize and encourage 
public-private partnerships. I am a big believer in innovation. 
That is one of the things I talked about. In our Investing in 
Innovation Fund, we actually required a 20 percent private 
match to our dollars. So there is no free lunch, and local 
communities have to buy in. In all the grants we made, that 
obligation was fulfilled.
    So it is not just our dollars and our resources going in. 
It is a community really buying in to what they are doing. We 
have done that in many of our competitions, and there has been 
tremendous interest. Again, folks told us it wouldn't work in 
the inner city, it wouldn't work in rural communities. It has 
worked. And people have stepped up big time.
    So we can give you lots of examples of public-private 
partnerships that we have encouraged, we have supported and 
invested in, but to be very clear, the leadership and the 
vision is not coming from us. It is coming from great local 
educators in the large communities.
    Mr. Rigell. Well, that is common ground right there. Thank 
you very much, Mr. Secretary.
    And thank you, Mr. Chairman. I yield back.
    Mr. Cole. We will go next to our ranking member for another 
round.

                    ADDRESSING FRAUD IN STUDENT AID

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    In apropos of my colleague's comments with regard to fraud, 
my understanding is that the Education Department Inspector 
General has determined that the biggest problem was at the 
University of Phoenix, which is one of these for-profit 
colleges, and they found 750 fraud rings involving about 15,000 
people.
    So I would love you to answer the question that we didn't 
get time for in which the reform proposal and dealing with 
these for-profit colleges that are ripping the system off and 
taking the money away from kids and others who need it. And 
then I want to move to another question.
    Secretary Duncan. Just quickly, we want to lead the world 
in college graduation rates. A generation ago we did, and today 
we are 12th. So we need to get better faster.
    We need more universities of all types--nonprofit, public, 
private, faith-based, and for-profit--where they are doing a 
good job in providing real training and real skills that lead 
to real jobs.
    Where that is happening, we think that is a good investment 
of taxpayer dollars. When they are leaving disadvantaged folks 
in a worse financial situation than they started and using our 
public dollars to do that, that is untenable.
    So we have challenged the status quo extraordinarily hard 
in a number of different ways. That has not been without 
pushback from some of your colleagues, quite frankly.
    Ms. DeLauro. Yes, indeed. And that is wrong, that pushback.
    Secretary Duncan. But we feel we have done the right 
things.
    In terms of the 90/10 rule--and it gets a little 
technical--but, basically, the simple premise that came to us 
from Congress was that there should be some individual 
investment. If there is real value here, it shouldn't all come 
from taxpayer dollars.
    And 10 percent, I think, is not an insurmountable challenge 
there. When folks were using the GI benefits to go beyond that, 
that is just more additional public dollars.
    I don't know how people sleep at night when you are taking 
folks who have served their country, who are coming back, 
trying to train and retool and then giving them huge debt and 
inadequate training or phony training. I don't know how you can 
sleep at night.
    So we are going to challenge the status quo where it is 
abusing individuals, leaving them in worse financial 
situations, and taking advantage of taxpayers. Where folks are 
doing a good job, we are supportive of that.
    Ms. DeLauro. And I will just say, Mr. Secretary, it is my 
intent to be very vocal on this issue because there are scarce 
dollars and they shouldn't be going in that direction. They 
should be going where they are needed.

                  TEST SCORES AND TEACHER EVALUATIONS

    Let me move to another area, and that is test scores and 
teacher evaluations. We know how important it is to identify, 
remediate, and, if necessary, remove teachers from the 
classroom who are persistently ineffective.
    The Department's policy reflects a lot of confidence in 
value-added metrics and encouraged districts to use them as an 
important factor in evaluating the effectiveness of teachers.
    There is a consensus and there are independent experts who 
have warned against using such data for high-stakes decision-
making because of what, in their view, is a lack of reliability 
across years, classes, subjects.
    But this is Rand, National Research Council of the National 
Academies of Sciences, Educational Testing Service at 
Princeton, the American Statistical Association, the American 
Educational Research Association.
    Given that there is a growing and a kind of consistent body 
of research that demonstrates unreliability and inaccuracy of 
value-added scores, are you prepared to rethink the Federal 
requirement that value-added data be included in teacher 
evaluation for those States that receive a waiver from No Child 
Left Behind?
    Secretary Duncan. Well, your question is actually 
incorrect. We never say you have to use value-add. What we say 
is that student learning, student growth, needs to be a part of 
that.
    What we are challenging in many--not many--in some States--
when we came to Washington, I was a little stunned to learn 
that it was actually against the law to link student learning 
to teacher evaluations. I would say the goal of great teaching 
is never just to teach. It is to have students learn.
    And so, to be clear, we always say multiple measures. There 
are a whole host of things that need to be there. We want to 
elevate and strengthen the teaching profession.
    Ms. DeLauro. So there is no emphasis on testing, on the 
test scores?
    Secretary Duncan. There is no requirement on value-add. 
What we are saying is student learning needs to be a part of 
teacher evaluation and one of multiple measures, never one 
thing.
    So people take this to the extreme. Focusing only on test 
scores I think is a problem. Anyone who says that student 
learning is irrelevant to teaching doesn't make sense. And to 
be really clear, what I am interested in is growth and gain, 
how much are students improving each year.
    What I hated in No Child Left Behind--not to go on too 
long--if a teacher took a child that was a couple years behind 
and caught them up under No Child Left Behind, they are labeled 
a failure if they are still not at grade level.
    But if a child makes 2 or 3 years' worth of growth for a 
year of teaching, that teacher is not a failure. They are a 
hero. They have done extraordinary work. We want to look at how 
much students are improving each year.
    Ms. DeLauro. Well, but the issue as well is that most of 
the VAM studies find that teachers account for about 1 percent 
to about 14 percent of the variability in test scores and that 
the majority of opportunities for quality improvement are found 
in the system-level conditions.
    Ranking teachers by VAM scores can have unintended 
consequences that are negative consequences. The whole issue of 
poverty, the issues that you and I have talked about many, many 
times that need to go into the debate, and the discussion about 
the evaluation of teachers and that it has been viewed as the 
test scores have been a primary measure, metric, if you will.

                TEACHER EVALUATIONS AND STUDENT OUTCOMES

    Secretary Duncan. Just to be very clear, we have never 
advocated ranking teachers by test scores. But just to 
challenge your--you know, children who live in poverty, in very 
difficult circumstances, have huge challenges, and we need to 
do everything we can to overcome them, which is why we all come 
to work every single day. It is where we get our passion from.
    Having said that, even among poor children, we see 
tremendous variations in outcomes. And we see examples like 
Newport News that we talked about where poor children are doing 
amazing work. I have been to Native American reservations with 
70 to 80 percent poverty. Some are heartbreaking educational 
situations. Some are getting amazing results.
    And so where there is huge variation there, I think we, as 
educators, need to learn from that and we need to understand 
what is working for children who have challenges and how do we 
take to scale those things that are helping to transform their 
life chances.
    Ms. DeLauro. Well, it continues to be my hope that we will 
not focus continuously on the test score because children in 
high-poverty areas are dealing with serious, serious 
consequences, and we need to focus more time and attention on 
training the teachers to be able to deal with those youngsters 
and be able to address those noncognitive skills, as you are 
trying to do in other parts of your budget.
    Thank you very much.
    Thank you for your indulgence, Mr. Chairman.
    Mr. Cole. Well, actually, my friend, having watched 
Republicans argue with Republicans for the last 3 days, it is 
nice to watch Democrats argue with Democrats a little bit.
    Secretary Duncan. We are not arguing.
    Mr. Cole. I have enjoyed the rhetoric today.
    Ms. DeLauro. We always are in discussion. It is a good 
thing.
    Mr. Cole. No. It is a very good thing.
    But I actually want to pick up and maybe add a little bit 
on your theme. This gets down to an area where I think there is 
always room for legitimate disagreement.

                   COMPETITIVE VERSUS FORMULA GRANTS

    But, Mr. Secretary, in previous years, your budget request 
for fiscal year 2016 invests pretty heavily in competitive 
grant programs that allow the Federal Government to dictate how 
States and school districts operate. Actually, when I was a 
freshman on this committee back in 2009, there was 
considerable--I wouldn't say frustration, because, again, this 
is an important tool. I am not trying to suggest it is not.
    But particularly then, when we had school budgets 
collapsing all over the country, there was a lot of concern, 
``Why aren't we doing more of this stuff within the formula? 
Why aren't we allowing school districts to have more 
predictability?''
    And, again, you are using this approach to try and inspire 
some innovation in the field. We talked about that yesterday. I 
get that. However, States and school districts are constantly 
striving to provide quality education, and I think they are 
free to innovate on their own within formula grants.
    So, given that, talk to me a little bit philosophically 
about the value of competition in the grant system, which I 
think runs through your budget, because the counterargument is 
that leads to micromanagement up here, that, frankly, by using 
a grant system, we are dictating a lot at the State and local 
level as to which directions they go.
    So I want to see how you find that balance and what you 
think is appropriate.
    Secretary Duncan. It is a great question.
    We have lots of both internal discussions and debates with 
other folks. Just for the record, to be clear, the overwhelming 
majority of our budget is formula-based. It is actually 91.6 
percent. Only about 8.4 percent of what we are proposing is 
competitive. So just to have the facts. Most people think it is 
like 50/50 or something. It is not even close. The overwhelming 
dollars are formula, actually more in Title I.
    Having said that, having a piece of our budget spur 
innovation and support innovation we think makes tremendous 
sense. And, Congressman, the thing for me that just sort of 
comes through here is there is tremendous unmet demand. So if 
we were trying to sell something that nobody was buying, I 
would listen to that very, very closely.
    On the preschool development grants, we were able to fund 
18 States. We had 36 States applying, again, across the 
political spectrum. So there is huge interest there.
    Under the Investing in Innovation Fund, we were able to 
fund 1 in 20 of the applications. So 5 percent, basically, of 
what we got in from communities around the country we were able 
to fund. Promise Neighborhoods, we funded 1 in 10. First in the 
World, 1 in 20.
    So quite to the contrary that we shouldn't be doing this. 
There is desperate need. There is huge creativity and 
innovation. There is a lack of resources. There is a lack of 
ability to scale.
    I think so many of these lessons--what we are learning 
through some fantastic work in rural Tennessee has applications 
to rural Appalachia and maybe to Native communities as well.
    I think it is a very appropriate role for the Federal 
Government, whether it is us or whether it is the National 
Institutes of Health or whether it is the military through 
DARPA, spurring innovation and scaling what works.
    So if I look at--not to go on too long--if I look at some 
investments we have made in Appalachia in Ohio, huge increases 
in those students taking and passing AP classes. My 
understanding is in those districts, their graduation rates are 
now ahead of the rest of the State. So for all the poverty, for 
all the challenges, and the very real--they are ahead of where 
the State is.
    I look in rural Tennessee. Huge increases in the number of 
students who are taking and passing AP classes, the vast 
majority first-generation college-goers. I visited east L.A.--
Congresswoman Roybal-Allard is gone--but the Promise 
Neighborhood there, where it is a multi-generational education 
system, they are educating babies and their parents.
    The demand, frankly, far exceeds our ability to support 
this work. My hardest conversations were conversations with 
folks like Governor Bryant in Mississippi, who is a very 
staunch conservative, who desperately wanted our resources to 
expand early childhood education, and we simply didn't have 
enough dollars.
    We know the huge unmet need, the desperate need, in 
Mississippi. So I felt horrible about it. He was 
extraordinarily frustrated. But we simply didn't have enough 
competitive dollars to put behind States like Mississippi, 
trying to do better for their babies.
    Mr. Cole. You know, I think it is a challenge. And, 
frankly, thank you for your long and thoughtful and nuanced 
answer.
    The concern I have quite often is the fact that, yes, there 
is this huge unmet need and a lot of people are then spending a 
lot of time that have very worthy proposals and are not going 
to be able to get there. I hear a lot of frustration on the 
other end when you can only fund 1 out of 20 grantees.
    I suspect there was a much higher percentage of that that 
you would have liked to have funded. But they have gone to 
considerable expense and a lot of effort. And there is 
certainly some good to be had there, but there are some 
difficulties in hitting the right balance.
    I want to move next to the ranking member of the full 
committee, the gentlelady from New York.
    Mrs. Lowey. Thank you very much.

                     SHORTAGE IN QUALIFIED WORKERS

    It is always a pleasure to welcome you. I apologize that we 
have four hearings at the same time. So some of us wish we had 
roller skates around here. But I know how important your work 
is, and I appreciate your leadership.
    A couple of questions. First of all, one of my main focuses 
in my district: Hearing from employers who say they have jobs 
to fill primarily in the high-tech and medicine fields, but 
there are not enough people with the skills needed to fill the 
positions. Just recently one of the hospitals was telling me 
they had 2,500 jobs and they can't find people to fill them.
    The disparity between the skills job-seekers have and the 
skills employers need to fill available positions, known as the 
skills gap, hinders employers from expanding, innovating, 
improving productivity. It prevents workers from obtaining 
well-paying jobs in demand industries.
    This is widespread, facing employers across the country, as 
more than two-thirds of manufacturing executives report 
shortages of qualified workers.
    In addition, the demand for skilled workers is increasing. 
I understand that, by 2020, two-thirds of jobs will require 
some post-secondary education and training. The budget includes 
$200 million for a new American Technical Training Fund that 
will fund up to 100 centers at community colleges to support 
job training programs.
    How would these grants help meet employee needs while 
providing a path to the middle class for low-wage workers?
    Secretary Duncan. You have identified a theme that so many 
folks have, and that I have seen consistently as I have 
traveled the country. We have to provide, not just young 
people, but folks coming back to retrain and retool, with the 
skills to obtain high-wage, high-skill, middle-class jobs.
    There is tremendous unmet need, whether it is in your 
district or around the Nation; the historic disconnect between 
what educators are providing and what CEOs and employers are 
looking for is pretty staggering. So you hit the nail on the 
head.
    I am a huge fan of these programs. We are going to continue 
to invest in community colleges and in high schools, and I 
would go so far as to say in middle schools as well. They are 
helping to expose young people to the jobs of the future.
    We want to only invest where the education sector is linked 
to the private sector, to where the real jobs are and that real 
training is leading to real jobs, and that is how we want to 
hold ourselves accountable. We are seeing fantastic innovation 
in many, many of the community colleges we visit, but we can't 
do enough of this.
    And while we are very committed, we are not doing this 
alone. The Department of Labor has been a fantastic partner, 
particularly on the community college side, and over the past 4 
years has invested about $2 billion to make sure that real 
training is leading to real jobs on the back end.
    Mrs. Lowey. Could you share with me some kind of evaluation 
that you are doing with the Labor Department. Because I know we 
are investing, but I still see these tremendous needs out 
there. And maybe we could do another briefing.
    Secretary Duncan. We can go through that, and I can have 
Secretary Perez reach out and walk you through it. But, for me, 
the accountability on this stuff is pretty simple. We need to 
hold ourselves to the highest standards. The simple question 
is: Is this training leading to real jobs in the community?
    Mrs. Lowey. Is it?
    Secretary Duncan. In many places, it absolutely is. In some 
places, we have to continue to get better and we have to 
continue to encourage people to come to the table and talk this 
through.
    So I think there has been significant progress. Is there 
still tremendous unmet demand? Absolutely. And it is incumbent 
upon all of us to help folks who are trying to hire.
    I can't tell you how many CEOs that I have met with and the 
President has met with, saying, ``We are trying to hire right 
now. We can't find folks with the skills.'' That makes no 
sense. It is mind-boggling. They want to keep jobs in the 
communities and in our Nation.
    So without looking at a formal evaluation, my sense is we 
are making real progress, but we have a long way to go and we 
have to get better faster.
    Mrs. Lowey. I would be interested to know what kind of 
support, what kind of actual dollars, the corporations with 
which you are interacting invest. I mean, the profits are huge, 
not for all of them. What kind of partnerships are there?
    Secretary Duncan. So, again, the good ones--and not 
everyone is good--the good ones are helping in a couple 
different ways.
    Some are actually providing the high-tech equipment to the 
community colleges because it helps to train. Some are helping 
on the curriculum, what gets taught and having their employees 
help to teach. And many are providing summer jobs and 
internships so they can start training young people while they 
are in school are getting the skills they need to go to work.
    So those are sort of high-caliber, high-quality programs. 
Not everyone is doing that, but there are some fantastic 
examples out there.
    Mrs. Lowey. Well, I see my red light is on.
    But I would love a further briefing on that because our 
chairman, I know, is committed to many of the issues that were 
discussed today, but we really have to look at the dollars and 
see what is working, what is not.
    And maybe the private sector could do more in training and 
work with the high schools preparing people, or the community 
college, depending on what level the jobs are.
    Thank you, Mr. Chairman.
    Mr. Cole. Certainly.
    We will go next to the gentlelady from Alabama.
    Mrs. Roby. Thank you, Mr. Chairman.
    And, Mr. Secretary, great to see you. Mr. Skelly.
    I have appreciated the interactions with you over my short 
time in Congress, and even though many times we don't see eye 
to eye, I do appreciate having the opportunity to talk with you 
today.
    As you know, I first met you when I was on the Education 
and Workforce Committee, the authorizing committee, and now I 
am excited to have this place on Labor-H Subcommittee for 
Appropriations.

                     FEDERAL INTRUSION IN EDUCATION

    When I was on the authorizing committee, I introduced a 
bill called Defending State Authority Over Education Act, and 
it sought specifically to prohibit the Secretary of the 
Department of Education and future Secretaries from using 
grants and policy waivers to coerce States into adopting 
certain policies, including preferred standards and curricula. 
And so we were successful in both last Congress and this 
Congress in getting this bill language into the Student Success 
Act.
    And whereas that bill has not been passed by the House yet, 
I believe that there is a broad agreement in both the House and 
the Senate that the executive branch has exceeded its reach 
when it comes to State education policy and allowing the local 
control--the local school board, States, and parents to be in 
the driver's seat of making decisions.
    And we all agree. I mean, I want Alabama, my State, to have 
the highest standards and challenge students and build critical 
thinking skills. I am a mother of a fourth grader in the public 
school system, and I am glad that our State has made efforts to 
raise its standards in recent years when we have lagged behind 
for so long.
    But however welcome the collaboration between States may 
be, the intrusion of the Federal Government into that process, 
directly or indirectly, is inappropriate and it invariably 
comes with a political agenda from here in D.C.
    And as I have stated in numerous speeches, those that are 
up here making decisions about how children in Alabama should 
be educated when they have not even been to Alabama and we know 
that schools differ from school district to school district and 
even can be vastly different in their population within a 
district--I think that those parents and principals and 
teachers and local elected officials should be the ones in the 
driver's seat of determining the best policy.
    So as we are here today to consider your budget request, I 
just want to hear from you about how the Department under your 
leadership plans to deal with these issues moving forward. And 
what can we expect to come down the pipeline as it relates to 
the Department, the U.S. Department, setting policy for States 
when I clearly don't believe that that is the right way to do 
things?
    Secretary Duncan. Words are important. I think in your 
statement--some stuff I agree with, and some stuff you conflate 
or, frankly, confuse.
    What we asked States to think about and encourage is for 
States to have high standards. The idea that so many States 
actually dummied-down standards under No Child Left Behind, and 
reduced their standards to make politicians look good, is one 
of the most insidious things that I think has happened in 
education.
    Children who have worked hard and played by the rules who 
graduate and are woefully underprepared for college and have to 
take remedial classes and burn through Pell Grants, I don't 
know who that serves well. It doesn't serve the individual 
well. It doesn't serve taxpayers well.
    And I would ask you what your State's college remediation 
rate is in their 2- and 4-year universities? I don't know it. 
My strong bet is that over a third of young people in your 2- 
and 4-year public universities have to take remedial classes.
    And so where States are raising standards, we think that is 
fantastic. We are not setting those standards. We have provided 
waivers to States under No Child Left Behind because No Child 
Left Behind is broken and Congress has been dysfunctional and 
has not been able to fix it in a bipartisan way.

                      STATE STANDARDS AND WAIVERS

    We have worked with States across the political spectrum on 
that. We have provided waivers to States that have done their 
own thing. And our only question we ask of Alabama and Texas 
and every other State is, ``Will your institution of higher 
education''--not ours, institution of higher education in your 
State-- ``say that students who are at this standard don't have 
to take remedial classes?''
    So we don't see much controversy there. We don't see much 
issue. We have given waivers to States--sort of more 
traditional States on the right, like Texas, and we have given 
waivers to States on the left, like Minnesota, which have done 
their own thing.
    There hasn't been controversy there. We think that is the 
right thing. If States want to lower standards, they have the 
right to do that. We can't stop them. We just don't think that 
is something that we are going to support.
    We are barred by law from touching curriculum. So we have 
never done that. Never have. Never will. That should always be 
determined by local educators and parents and board members. We 
just think there should be a high bar for students. How you 
help students achieve to that higher bar is always best 
determined at a local level. And we have been 100 percent 
consistent on that from day one.
    Mrs. Roby. Well, my time is expired.
    Let me just say, again, my position is that the U.S. 
Department of Education ought not to be able to tie funding to 
coercion of State and local school boards to have to do certain 
things, and that is what has happened in the past.
    And it is my sincere hope that this Congress can get it 
together and pass the Student Success Act so we won't see any 
further processes like that.
    So thank you again for being here.
    And, Mr. Chairman, I yield back.
    Mr. Cole. Certainly.
    The gentlelady from California is recognized.
    Ms. Lee. Thank you, Mr. Chairman.
    Good morning, Mr. Secretary. Sorry I missed your testimony. 
I will look at it. I was in another committee hearing, also. 
But I am really pleased to see you, and I have a few questions 
I would like to ask you.

                         SERVING AT-RISK YOUTH

    First of all, we all know that children in poverty are 
often the ones most susceptible to dropping out. It is very 
difficult to learn when you are hungry. It can ultimately lead 
to poor grades. Poor grades, of course, can lead to 
discouragement and, ultimately, dropping out of school. Many of 
these young people end up in juvenile hall. We can't afford to 
let this happen. We can't afford to lose the brain power. And 
so many of our young people, unfortunately, are lost after they 
drop out of school.
    So I was wondering if you have any--and we have a model 
program in California--or an example of a program where the 
coordination between, say, the Department of Justice and the 
Department of Education to make sure that at-risk youth are not 
at risk as a result of what is taking place due to the dropout 
rate. So I want to see if there are any joint efforts between 
yourself and DOJ on that front.
    Secondly, as it relates to the proposed increase for TRIO--
I think it is $20 million for TRIO funding--it would use for a 
demonstration initiative, I want to ask you a little bit about 
what the demonstration projects look like. Multi-year 
initiative or activities that would take place only in 2016?

     IMPACT ON HISTORICALLY BLACK COLLEGES AND UNIVERSITIES (HBCUS)

    Also, I am pleased to see the community college initiative, 
and I want to make sure that the funding doesn't put HBCUs and 
any of our minority-serving institutions at risk. With regard 
to HBCUs, you know, I noticed in your budget that you didn't 
restore the sequestration cuts to the capital financing program 
and want to know what that is about. I know there was a drop in 
loan activity last year. So I would like to ask you to kind of 
flesh that out for us.
    And, finally, let me just ask you, as it relates to HBCUs 
and the whole effort to--I guess you flat-funded minority-
serving institutions this year. It is very important to 
recognize and remember that HBCUs graduate about--the 
graduation rate is almost 40 percent, 39.9 percent. African 
American students at community colleges, the graduation rate is 
12.5 percent.
    And so we have to, going back to what I said earlier, make 
sure that the community college initiative is fully funded 
because, you know, people need to be able to go to school and 
gain the type of education that community colleges provide. 
Peralta in my district is a great example of that.
    But I don't want to see HBCUs put at risk because, again, 
going back to California, many of our young people now--because 
of the end of Affirmative Action, they are not at the 
University of California anymore. They are at HBCUs. So just 
coming from a California perspective, I want to make sure that 
both budgets are fully funded and we don't rob Peter to pay 
Paul.
    Secretary Duncan. I think there are three or four questions 
there. I will try and get to them all quickly, and if I miss 
it, let me know. I will follow up off-line.
    So, quickly, the good news, which I talked about before you 
got here, is that dropout rates are down significantly. African 
American dropout rates are down 45 percent. Latino dropout 
rates are down 50 percent over the past decade. That is huge. 
That has translated to all-time-high high school graduation 
rates and, between 2008 and 2012, 1.1 million additional 
students of color are not just graduating, but going on to 
college.

                       SCHOOL-TO-PRISON PIPELINE

    So while we are thrilled with that progress, we are not 
satisfied. There is a long way to go. The dropout rate is still 
unacceptably high. We have partnered with the Department of 
Justice in lots of different things, and we can work through 
that or show you what we have done.
    One of the big things that we have done together is really 
tried to address the school-to-prison pipeline. I learn 
something every single day, but I tell you I was stunned to 
learn that across the country we were suspending and expelling 
3- and 4-year-olds from preschool. And we know who they are--
black and brown boys. I had no idea.
    So along with my good friend, Eric Holder--I am sorry he is 
departing--I wish him well--we put out very clear guidance 
saying you have to look at these things. Lots of 3- and 4-year-
olds have challenges. I had a couple 3- and 4-year-olds myself. 
Putting them out of school, suspending, expelling them, I don't 
know what problem that is solving.
    We have tried to be very self-reflective and look in the 
mirror, and we have seen places like L.A. significantly reduce 
suspensions and expulsions and move towards more restorative 
justice and peer juries and those kinds of things, and the 
Attorney General and DOJ has been a great partner there. That 
is one example.

                     TRIO DEMONSTRATION INITIATIVE

    On TRIO, we want to put more resources there. We want to 
give folks who run these programs more room to do some things 
differently, try some new approaches, be a little bit more 
innovative and give them flexibility. If somehow our rules are 
hampering or preventing them from doing something they think 
would help more students, we want to give them more latitude 
there.

                      COMMUNITY COLLEGES AND HBCUS

    Finally, this investment in community colleges I think is 
actually a huge deal for HBCUs. And this is not one versus the 
other. I think that is absolutely the wrong mentality. We need 
a heck of a lot more students of color to not just graduate 
from high school, but go on to higher education.
    Many HBCUs are community colleges to begin with. So they 
would be funded directly. But if we can open up community 
colleges to a lot more young people and first-generation 
college-goers African Americans, and Latinos, they will not 
just graduate from colleges, they will go on to 4-year 
institutions, and we will significantly increase the pipeline.
    So anyone who thinks this is one versus the other, I think 
totally misses what is possible here by expanding access to 
community colleges. If we increase the size of the pie, 
everyone is going to benefit, and I think HBCUs could 
potentially benefit disproportionately because so many 
community college students happen to be students of color. If I 
have missed some stuff, let me know. We will come back.
    Ms. Lee. We will come back around.
    Mr. Cole. We will certainly give you another opportunity, 
but you got quite a few on the Secretary's plate there.

                 ADDITIONAL INVESTMENTS IN TRIO PROGRAM

    I do want to pick up where my friend, Ms. Lee, left off on 
TRIO. Because while you do have an increase there--and I think 
there is really strong bipartisan support for this program. 
Certainly in my district I have seen the difference it makes in 
helping first-generation college students actually succeed.
    And as we discussed when you and I had the opportunity to 
meet, one of my big concerns and I know this Committee's big 
concern is just the dropout rate in college, the number of kids 
we lose that, number one, walk out with debt maybe that they 
didn't have before and, much more importantly, I think they 
walk out sometimes with a sense of failure that nobody in their 
family has been able to do it. They tried but they were not 
able to do it. It is just really something that I think bears a 
tremendous amount of focus.
    Given that, I mean, what you have added is about $20 
million. It is for another program, as you have said, an 
innovative program, but it doesn't expand what is already an 
underused program. And these are pretty competitive programs. 
As it is now, you already are going through a lot of 
application processes.
    When I am dealing with local TRIO programs, they are quite 
often wondering, ``Are we going to make it this year? Are we 
going to be funded this year?'', that sort of thing.
    So tell me, if you will, number one, why not more money in 
that program? If you have concerns, I am delighted to hear 
them. I would really want to know what they are.
    I know we have put a lot on your table and we are asking 
you to do everything from preschool to make sure that nobody 
drops out of college. And I do worry sometimes, when we have 
programs that I think are working at least, we are stretching 
you so far maybe we are not putting enough focus on those 
areas.
    So talk to me a little bit about what your plans are for 
TRIO and anything else that you want to throw in that would, 
again, reinforce the ability of children or young people, once 
they enroll in college, to stay there and actually get through 
with that degree.

                     COLLEGE ACCESS AND COMPLETION

    Secretary Duncan. I am happy to have a conversation about 
more resources for TRIO and other programs. That is music to my 
ears.
    I should also come back, Congressman Lee, to your point.
    We don't just have one funding source trying to help first-
generation college-goers. So, obviously, TRIO is a big part. 
GEAR UP is a big part. Clearly the community college thing is a 
huge push to have more at-risk students graduate.
    The other one that I failed to mention in answer to both of 
your questions is First in the World. That is all about--more 
competency-based, speed to degree, better remedial, better 
developmental work. We have seen, again, huge interest there, 
real innovation.
    HBCUs did a great job, disproportionately got significant 
resources in First in the World, which is one reason we didn't 
bump up the bottom line, because there are more resources in 
First in the World for HBCUs. I failed to mention that.
    So it is a longer conversation, but we should sort of lay 
out for you not just this one funding stream, but here are the 
three, four, five things we are doing to try and help more 
young people graduate. And we know we have much further to go. 
We know we have to get better faster. So if there are thoughts 
of things we can do to accelerate the rate of progress, I am 
all ears and happy to have that conversation.
    I will also say that long term, one of the most important 
things I think we can do to help more young people not just go 
to college, but to graduate, is to make sure they are going to 
college and not having to take remedial classes. Again, I saw a 
study, I think from Oklahoma, that was like 40 percent. This 
supports the idea of having high standards, again, those should 
be set at the local level, by States, not by us, to be very 
clear, to our friend from Alabama.
    But where States have historically lowered standards, we 
can do all the TRIO, we can do all the catch-up, but we are 
setting kids up to be less than successful. This idea of making 
sure students are graduating across the Nation truly college- 
and career-ready with a simple definition, meaning, if they 
graduate, they don't have to take remedial classes. I think 
that is a very simple, but powerful, idea that long term will 
help to boost the college completion rate that we are all 
concerned about.

                       EARLY CHILDHOOD EDUCATION

    Mr. Cole. Let me move to the other end of the spectrum, and 
I know I am about to run out of time.
    But, again, as we talked, early childhood, I know, is a 
very, as you made clear here, very important emphasis for you. 
Right now I think, if you look at Early Head Start and Head 
Start, we are almost a little bit of an inverted period. We 
include more people as they get a little bit older, and I 
understand that.
    But I am curious if dollars--I have read research that says 
the best time is zero to 3. I mean, you have got to get in 
there early, not 4 and 5. You are almost jeopardizing your 4 
and 5. Is that true, number one? And what are you proposing to 
do at that very entry level in terms of early education?
    Secretary Duncan. That is a very thoughtful question. You 
raised it the other day. Again, these are long conversations.
    My short answer is I always want to look at a zero to 5 
continuum. And we know learning doesn't start in kindergarten, 
at 5. We know learning starts at birth. And whatever we can do 
in that zero to 3, whether it is Early Head Start or home 
visiting programs--and I have seen some fantastic programs in 
rural Kentucky and other places that parents who were not lucky 
enough to have a huge amount of education themselves, with some 
help and support, are doing a fantastic job of raising their 
kids and helping to give them some opportunities that exist.
    But, for me, it is always not this versus that. It has got 
to be both. If we look relative to other industrialized nations 
in terms of access to preschool, we are like 28th, again, just 
nothing that we can be proud of or should be proud of.
    And the fact that we don't lead the world in providing 
access to high-quality early learning opportunities doesn't 
make sense. And, again, outside of Washington, this has become 
an unbelievably bipartisan issue. From the left to--you know, 
Governor Abbott in Texas just said last week his first 
priority--strong conservative governor--his first priority is 
increasing early childhood education. It is beautiful. It is 
music to my ears.
    We just have to get folks here in Washington to listen to 
what is going on back home. And I don't say this lightly. I 
think your State, Oklahoma, has done this as well or better 
than any other State. It is a strong, conservative State, 
Governor, House, and Senate. And if every State was doing some 
of what Oklahoma was doing, our Nation would be in a much 
better situation.
    So whether it is Oklahoma on the early childhood side, 
whether it is Tennessee on the community college side, I think 
they are fantastic examples that we should be learning from and 
throwing politics and ideology out the window.
    Mr. Cole. Well, thank you.
    And a word to the wise. Anything you can find in rural 
Kentucky that is working will be well received on this 
committee.
    So, with that, I will go to my good friend, the ranking 
member.

                      PRESCHOOL DEVELOPMENT GRANTS

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    And when you spoke, Mr. Secretary, and the Chairman asked 
you where would you spend the dollars, so this is the 
continuation of this issue on preschool, on early childhood.
    I want to say to the chairman that, in the HHS budget, 
there is a $1.5 billion increase in Head Start, and that is the 
money that deals with zero to 3 and a number of the wraparound 
services, Mr. Secretary, that you speak about with other 
countries that deal with early childhood education. It is the 
education plus the wraparound services which are found more in 
the HHS budget.
    But I want to again--the pre-kindergarten programs, it 
levels the playing field. It really does. You have an 
extraordinary program in Oklahoma, Mr. Chairman. And there you 
are looking at--and we were talking about some of these issues 
before. It is academic, cognitive, emotional skills that are 
being viewed, and there are very high standards.
    We had $250 million for the preschool grants, and the first 
round of grants are out, Mr. Secretary. And I am proud to tell 
you that you know that Connecticut received a grant, and it is 
going to be 400 additional kids.
    Can you give us information on the implementation of the 
program, how the grants are, what they are looking like, how 
they are improving standards and providing some comprehensive 
services.
    Secretary Duncan. And, again, I just appreciate so much 
your compassion and commitment on this issue. And just to say 
again, if we could do one thing together, if we could increase 
access to high-quality early learning, it is life-transforming.
    And, you know, folks who are a lot smarter than me, people 
like James Heckman, who is a Nobel Prize-winning economist at 
the University of Chicago, talks about a 7-to-1 return on 
investment. So for every tax dollar, we get back $7, less 
incarceration, less dropouts, less teenage pregnancy, more 
folks graduating, going on to college, getting a job, becoming 
productive citizens.
    When I think of all the tax dollars we have spent, how many 
can we honestly say we are getting a 7-to-1 return on 
investment? I don't know how often we can do that.
    Ms. DeLauro. How is the implementation, though?
    Secretary Duncan. We are trying to do two things. We are 
trying to increase access and make sure it is high quality. The 
goal is not just more slots. It is more children entering 
kindergarten with those social and emotional skills and 
academic skills they need to be successful.
    One thing I just want to add: All these good early 
childhood programs, it is helping children, but it is 
strengthening families and it is helping parents become better 
parents as well. And so we should come back with a report sort 
of State by State where folks are at and what they are doing.
    We loved what we saw. As the chairman said, I wish 
desperately we could have funded a lot more States than we had 
dollars. We just simply funded down. Felt thrilled for children 
in Connecticut. Was heartbroken that I didn't help kids in 
Mississippi. That didn't feel great. And so we should walk you 
through State by State.
    And we are doing annual report cards of what they are doing 
and what progress they are making. But to see so much interest, 
again more Republican governors and Democrats now investing, it 
is a beautiful thing.
    Ms. DeLauro. And we ought to be able to take those--it 
shouldn't be that your success is based on geography. We ought 
to be able to move these, you know, to scale. Nationwide we 
ought to be able to----
    Secretary Duncan. That is the final thing, is for all the 
hard work and innovation we are seeing across the country, 
virtually, in every single State I travel to, there are still 
waiting lists. So for all the work that local political leaders 
and educators and governors and mayors are doing, there is 
still extraordinary unmet needs.
    And for us to say to 3- and 4-year-olds, to your point, 
that somehow because you don't live in the right place or 
because your parents don't happen to be wealthy, we are going 
to deny you the opportunity to start to get some education 
before you turn 5, who are we helping there? Who are we 
helping?

                          NON-COGNITIVE SKILLS

    Ms. DeLauro. I want to follow up with the noncognitive 
skills where you have moved from a request of $2 million to $10 
million.
    The investment, again, in my view, is so worthwhile. I will 
not go through the reasons for that. But I want to know that--
you have got Investing in Innovation. First in the World are 
considering prioritizing the noncognitive skills piece as well.
    Can you give us any information on how funding through the 
competitions can help to mitigate the effects of poverty on 
students. And can you talk about the plan to spend the 
increased funding request in 2016.
    Secretary Duncan. First, again, thank you for being a 
champion here. Secondly, I hate the name noncognitive skills. 
No one knows what the heck that means. We need to all come up 
with a better name.
    But what it gets to, it gets to not just babies, Mr. 
Chairman, but it gets to how we help more first-generation 
college-goers be successful. It is a mindset.
    And we have been meeting with experts from, Stanford and 
Duke and Pennsylvania and other places who are showing actually 
some really interesting data at the community college side 
where some interventions are helping young people understand 
that, when they struggle, that is okay and that is not a sign 
of failure, it is actually their mind improving--the brain is a 
muscle and it is expanding and getting better with exercise.
    Seeing some real significant increases, same children, same 
challenges, same poverty. Starting to get very different 
outcomes. Fascinating research that Carol Dweck and others are 
doing that you should see. So, again, it doesn't say that 
poverty doesn't matter. It is saying poverty matters a lot. But 
with these commonsense innovations that, frankly, are not very 
expensive, we are starting to get much better outcomes.
    This is a hugely important emerging body of research. We 
need to invest more. We need to be doing more than what we are 
doing. I am glad we are increasing. We should, frankly, be 
doing a heck of a lot more than where we are. And just from a 
lifetime of working with kids in a disadvantaged community and 
understanding how powerful it is, that there is now a body of 
research that sort of confirms sort of what I believed all my 
life.
    It is extraordinarily powerful. We had a set of experts in 
last Friday, and we just shared the research. It is still 
early, still not at scale, still not national, but very, very 
encouraging about what young kids who have not been born with a 
silver spoon in their mouth can do with better support.
    The last thing I will say is they are not just working on 
young people on their own psychology around this. They are 
trying to change the cultures of the institutions that serve 
them. So if you have a college professor who says there are 
three of you sitting here and one of you will not make it, who 
is going to internalize, ``Well, he is talking about me.'' It 
is that child who is first generation.
    Mr. Cole. It will be that guy. No question.
    Secretary Duncan. So there is a lot here. We want to do 
more. And we should share with you what is coming out.
    Ms. DeLauro. Absolutely. Thank you.
    Mr. Cole. Next we will go to the gentlelady from 
California.
    Ms. Lee. Thank you.
    Mr. Secretary, let me just ask you this: Within this fiscal 
environment of sequestration and austerity, as you move around 
the country, how are teachers and educators faring in the 
classroom?

                     MINORITY SERVING INSTITUTIONS

    Secondly, with regard to the First in the World initiative, 
I went back and double-checked because you indicated that you 
set aside $60 million for minority-serving institutions under 
this. Whatever the number is, is it part of the reason for 
flat-funding HBCUs.
    I am double-checking this, and it is my understanding only 
one successful HBCU received any of the grants under this 
initiative. So can you kind of explain that.

                            CHARTER SCHOOLS

    And, finally, just with regard to charter schools, you 
know, I am still really very leery of what we are seeing with 
charter schools in terms of accountability, in terms of what is 
taking place, especially in California. And I know you are a 
big fan of charter schools. So you may want to tell us what is 
going on here.
    Secretary Duncan. Well, let me be clear. I am a big fan of 
good charter schools.
    Ms. Lee. There are a lot of bad ones.
    Secretary Duncan. There are good charter schools, and there 
are bad charter schools. There are good traditional schools, 
and there are bad traditional schools. And what I just want is 
to have every child to have access to a great school.
    And where we are supporting the replication of charter 
schools, we are trying to only invest in high performing ones. 
And where there are bad ones, I have been very public and gone 
to the charter school and asked the Convention and said they 
should close them down. They shouldn't exist.
    But where you have charter schools that are getting 
fantastic results, particularly in disadvantaged communities, 
and extraordinarily high graduation rates and high college-
going rates, we should learn those lessons and we should have 
more students have those kinds of opportunities. So we are only 
trying to invest not in random charter schools, but in places 
that are doing a great job for kids.
    On the First in the World Program, again, we think there 
has been significant interest and great work coming from the 
HBCU community, and we want to continue to support that.
    You had a third question.

                         HBCU CAPITAL FINANCING

    Ms. Lee. Well, on the capital financing--and that was part 
of the first question I ask you--why we are not funding--you 
are not adding----
    Secretary Duncan. We did not request an increase in funds 
for capital financing.
    Ms. Lee [continuing]. On the capital financing.
    Mr. Skelly. We can actually make $286 million in new loans 
there. So we don't need to have more money in the----
    Ms. Lee. Is that what the HBCUs are telling you, though?
    Mr. Skelly. Well, that is how much we calculated we could 
make in loans.
    Ms. Lee. Yeah. Well, I would say you should double-check 
with them first or at least check with me and I can give you 
some additional information on why I think that that is not a 
good number.
    But the other question I wanted to ask you was the 
austerity and the sequestration.
    What is going on in the classrooms now, given the strain on 
teachers and educators?

                    TEACHER TRAINING AND RECRUITMENT

    Secretary Duncan. That is a key question. And I talked 
about it a lot earlier before you got here.
    But teaching has never been more important. It has never 
been harder. It has never been more complicated. In our budget, 
we are asking for $1 billion for a Title I increase. We are 
asking for $2.5 billion for teachers and to support them and to 
train the next generation of teachers or principals and to help 
with technology.
    Great teachers, great principals, as we know, transform 
students' lives. Nothing is more important in school. Whatever 
we can do to better attract and retain great talent, 
particularly disadvantaged communities, be that inner city 
urban or rural or remote or, again, Native American 
communities, we have a lot of hard work to do there.
    When resources are down, when classes sizes are up, when 
there are fewer social workers, when there are fewer 
counselors, when there is less after-school programming, again, 
I fail to see who we are helping in those situations.
    Ms. Lee. Thank you very much, Mr. Chairman.
    Mr. Cole. You are welcome.
    We will go next to my friend from Arkansas.
    Mr. Womack. Thank you, Mr. Chairman.

                      LINKING EDUCATION TO CAREERS

    I apologize to the Secretary and Mr. Skelly because I am 
running late, but we have got the SecDef and the Chairman of 
the Joint Chiefs across the hallway and I have got dual 
purposes here this morning.
    Mr. Secretary, when I tour my district and I talk to my 
job-creators, I have become a bit overwhelmed over the last 4 
years when I talk to them about jobs. And almost to the person, 
depending on the type of employment they offer, but 
particularly where it concerns technical-type skills, I am 
taken aback by how many of them, nearly 100 percent, say, ``We 
have jobs, but we are having difficulty finding qualified 
people to work.''
    Now, the other side of it was a lot of them say they have 
trouble finding people that can pass a drug test. We know that 
is a whole other issue facing job creation.
    It is my opinion--and maybe you can convince me that I am 
wrong--but we have kind of misled, I think, an entire 
generation of young people to thinking that the only means of 
success is to make them a college graduate. And maybe I have 
got a jaded view of it.
    But a lot of people that have college degrees are still 
having difficulty finding work related to their specific 
degrees. But a whole lot of very high-paying, good-paying jobs, 
you know, welding and fabrication and those kinds of things, 
highly technical-skilled jobs, are just not able to be met.
    So what is your vision for the career and technical piece? 
Because I have got a lot of places in my district where they 
are recognizing that and community colleges are now working 
with local employers. It is amazing how this is happening. And 
I will let you answer in just a minute.
    But this is what The Manufacturing Institute says: ``Half 
of companies rely on word of mouth for hiring. Fewer than 15 
percent use educational institutes like technical schools and 
community colleges for hiring.''
    So it tells me that we have missed something there, and I 
want you to help me understand how we can do a better job of 
linking people that are career, technical bound-type students 
as opposed to trying to push them all into a college 
environment.
    Secretary Duncan. We talked about this a lot this morning 
prior to you getting here.
    One thing we are doing is we are asking Congress to give us 
an additional $200 million to invest more in this space. There 
is tremendous unmet need, tremendous demand that you talked 
about and you see in your district. I see it all over the 
country as I travel.
    Where I would disagree a little bit is we don't need less 
college graduates. We need every measure of long-term earnings. 
We need more college graduates. Always both.
    And what I say is for that every young person who graduates 
in this country, a high school diploma is insufficient. It is a 
great starting point. It is not enough. Some form of education 
beyond that--4-year, 2-year, trade, technical, vocational--some 
form of education beyond high school has to be the aspiration, 
the dream, for every single young person.
    There are some places where there are fantastic 
partnerships between employers and community colleges and high 
schools, other places where they don't talk. I think what we 
are trying to do is use our resources to bring people to the 
table.
    If employers are just pointing the finger at educators, 
that doesn't work. If educators say employers are the problem, 
that doesn't work. Where folks say, ``We all care about the 
community. We want to keep good jobs here.'' Let's figure out 
how we can help train young people for real jobs, real training 
that will lead to high-wage high-skilled jobs, we will try to 
do a lot to incentivize those collaborations and partnerships.

                           TRACKING STUDENTS

    Mr. Womack. Some countries overseas do a pretty good job of 
being able to identify in the pipeline where these students 
need to be--the track that they need to be on, whether it is a 
vocational track for a student that tests appropriately in 
certain categories as opposed to the kid that is obviously 
going to be a college-bound-type student to a 2-year or 4-year 
institution.
    Is that something we should be doing? Should we do a better 
job of trying to figure out at an appropriate age the track 
these kids should be on?
    Secretary Duncan. Let me say no, and I will come back to 
that.
    But there are other nations that do a much better job of 
providing vocational and technical training, and we need to 
learn from that. At the high school, at the community college, 
and, I would argue, even at the middle school level, we need to 
do a better job of providing that.
    What I don't agree with is tracking kids. I don't think at 
13 or 14 or 15 any of us should have the arrogance to say, 
``You are college material'' or ``you are not.'' There are so 
many folks I have talked to who have gone on to be CEOs who 
were told by some counselor, ``You should be a TV repairman.'' 
It is great to be a TV repairman, but they had other 
aspirations and dreams.
    So, for me, it is always about providing choices. It is 
about providing options and letting young people figure out 
what their passion is, what their interest is, what their skill 
is.
    So yes to much better training, yes to better ties to the 
world of work, yes to doing it earlier, but saying, ``You are 
college material, college-bound, versus you are not, that is 
not something I would ever support.
    Mr. Womack. One follow-up and then I will yield back.

                     CAREER AND TECHNICAL EDUCATION

    And that is: Should we then kind of retool our message to 
make career and technical education cool?
    Secretary Duncan. Absolutely. Can't do enough of that. We 
have done a lousy job of that for, I would say, a couple 
decades. And, for me, it is not just educating young people. It 
is educating their parents.
    And so I have talked to these CEOs where the starting 
salary is $40,000, $50,000, $60,000 and they can't find people. 
I say, ``What are you doing to bring in''--not the students--
``What are you doing to bring their parents into your 
facility?'' They have not thought about those things.
    But absolutely there is an image challenge, a branding 
challenge, whatever it is, and these are great jobs, middle-
class jobs that have huge dignity that require real skill, and 
we need to let young people and their families know the 
possibilities that exist there. I agree with that 100 percent.
    Mr. Womack. Mr. Secretary, I always appreciate you coming 
for us. Thank you so much.
    Mr. Cole. Mr. Secretary, we are going to draw our hearing 
to a close. But, first, I want to thank you very much for this 
generous allocation of your time.
    And I want to thank you, too, for your patience. We had, as 
everybody knows, quite a few hearings going on and members 
coming in and out, and you were very generous in dealing with 
that and suffering through that a little bit.
    So, again, thank you very much. I look forward to working 
with you as we go forward.
    And we are adjourned.
    Secretary Duncan. Thank you so much. Thank you for the 
spirit in which you have lead this hearing.


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                                           Tuesday, March 17, 2015.

                          DEPARTMENT OF LABOR

                                WITNESS

HON. THOMAS PEREZ, SECRETARY, U.S. DEPARTMENT OF LABOR

                        Introduction of Witness

    Mr. Cole. Okay. I am going to call the hearing to order.
    And just ahead of time, Mr. Secretary, as I am sure you are 
aware, we will have a lot of members coming in and out because 
we have got an awful lot of hearings going on this morning. I 
know we will be joined later by, we like to call him ``the big 
chairman,'' will be here. And, at that point, just so everybody 
knows, when he comes in, I will allow, once we finish whoever 
is questioning at that point, certainly go to the chairman, 
immediately allow him to make any statement he wants to make. 
Certainly do the same thing for Ms. Lowey if she has a 
statement she cares to make when she arrives.
    So, good morning, Mr. Secretary, and welcome. I want to 
thank you for your service to our country and certainly the 
administration and want you to know this committee recognizes 
the demanding role you have at a very difficult time. And I 
appreciate your work on behalf of the American people. We may 
have some areas where we disagree, but I certainly appreciate 
the effort and the commitment and compassion you display in 
your job.
    For the first time in many years, we have had some 
encouraging news on headline unemployment numbers, but the data 
belie the challenges faced by the long-term unemployed and by 
involuntary part-time workers, who I know you have concern with 
both those categories. Improvement in the unemployment data is 
also due in part to labor participation rates that remain at 
the lowest level in many decades. For too many Americans, the 
Great Recession doesn't feel over.
    Equally concerning is that despite the recent improvement 
in unemployment data, job openings continue to rise. There were 
5 million job openings at the end of January, the highest level 
in 14 years. And, in some ways, of course, that is good news, 
but despite billions of dollars the Federal Government invests 
in job training each year, the skills gap continues to grow. 
Employers can't find enough qualified candidates to fill the 
jobs they have while millions of Americans remain unemployed 
and underemployed. This indicates to me that there are some 
real structural deficiencies in the workforce training system. 
And I would like to hear your view on those during the course 
of our hearing.
    I would also like to cover a lot of subjects at today's 
hearing.
    Mr. Secretary, your budget far exceeds any realistic caps 
on spending. While you may have the luxury of proposing 
increases for virtually every program, we likely won't have the 
ability within our allocation to meet all those requests. With 
proposed increases across the board for the Department of 
Labor, I am having some difficulty in determining exactly what 
your priorities are. So I would certainly like you to make 
those clear to us today.

                        WORKFORCE INNOVATION ACT

    I would also like to discuss the Workforce Innovation and 
Opportunity Act, which Congress overwhelmingly passed last 
summer. A good example of bipartisanship, quite frankly. The 
committee is excited about many of the improvements WIOA makes 
to workforce training programs. However, I am concerned the 
Department is missing statutory implementation deadlines and 
delaying the benefits this reauthorization might make to 
millions of Americans.
    Finally, I would like to ask about the Department's 
regulatory agenda along several lines. I have got questions 
about the regulatory process that the Department is following. 
For example, you are developing a respirable silica rule that 
is relying on a small business advocacy review completed more 
than a decade ago even though industries that will be impacted 
by the rule have changed significantly since that time. Nothing 
is more important than worker safety, but we want to make sure 
we are using the latest information that we have. And so your 
thoughts in that area will be deeply appreciated.
    And I have some questions about the timing of your 
regulations. For example, the home healthcare rule being 
implemented now seems contrary to policies many of us have 
supported to encourage goals like aging in place and home care 
for people with disabilities to help reduce healthcare costs 
and improve the quality of life for millions of Americans.

                           H-2B VISA PROGRAM

    Finally, Mr. Secretary, I am deeply concerned that the 
Department has stopped processing H-2B visas in the wake of a 
recent court ruling although I understand you may have some 
news for us and a recent filing in your testimony. And I would 
be delighted to hear that because I know there is a bipartisan 
concern. To avoid significant economic losses to thousands of 
seasonal businesses, ranging from seafood harvesting and horse 
training to amusement parks and stone quarries, the Department 
of Homeland Security should immediately issue an emergency rule 
to allow the resumption of H-2B processing, and the Department 
of Labor could continue to participate in a consultive role in 
the program.
    I want to be assured the Department is pursuing ever 
recourse in order to restart the H-2B visa program as soon as 
possible.
    Thanks, again, Mr. Secretary, sincerely for being here. I 
would now like to yield to my good friend, the ranking member, 
for any comments she cares to make.

                Ranking Member DeLauro Opening Statement

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    Once again, I apologize for holding up the start of the 
gathering.
    And thank you, Mr. Secretary, for joining us this morning. 
Most of all to thank you for your leadership on behalf of 
American workers and their families.
    If you don't mind for a moment, I would just like to say 
hello to Dan Zeitlin, who you took from our office as a 
legislative director. Thank you very much. That was a good 
recovery, Mr. Secretary.
    The Department of Labor exists to represent the tens of 
millions of families who form the bedrock of our society and 
the engine of our dynamic economy. It helps provide them with 
stability by protecting their wages, their working conditions, 
health benefits, and retirement security.
    The economic picture for these hard-working families is 
decidedly mixed. On the one hand, the unemployment rate has 
dropped dramatically. At the height of the recession, it peaked 
at about 10.2 percent. Today it is at 5.5 percent. In each of 
the past 12 months, the economy has produced more than 200,000 
new jobs, the longest streak of job creation in two decades. 
Yet the rewards have not been shared equally. Average hourly 
pay has risen only 2 percent per year, barely enough to keep up 
with inflation.
    Meanwhile, corporate profits and the stock market are at 
record highs. In fact, economist Justin Wolfers and many others 
have noted, all of the financial gains of the recovery have 
gone to the richest 1 percent.
    This is just not good for our country. We cannot settle for 
an economy that benefits only Wall Street and a select few at 
the top. What we need to do is to build one that boosts wages, 
improves the lives of hard-working families. That is the recipe 
for a true long-term growth. And that is why the Department's 
mission of fighting for working families has never been more 
important than it is today.
    Recently the Department has made progress. It has been 
instrumental in raising the minimum wage for Federal 
contractors and prohibiting retaliation when workers share pay 
information. Both moves Congress would do well to emulate for 
all Americans. And it has taken steps toward requiring 
financial advisors to give advice on retirement savings that is 
in this best interest of their clients as opposed to their own 
interests.
    I applaud these efforts, and I encourage you, Mr. 
Secretary, to press even harder over the next 2 years to 
strengthen worker protection.

      FISCAL YEAR 2016 BUDGET REQUEST FOR THE DEPARTMENT OF LABOR

    That brings me to the topic of today's hearing, the fiscal 
year 2016 budget request for the Department of Labor. I am 
pleased to see the request for an increase of nearly 
$300,000,000 for job training, including increases for State 
grants under the Workforce Innovation and Opportunity Act, and 
a new program to boost registered apprenticeships. These 
investments are critical to building the high-skilled workforce 
that is necessary for employers to fill job openings and expand 
their operations in the high-tech and globally competitive 
economy.
    I strongly support your request for an additional 
$500,000,000 to fund career services for unemployed workers, 
particularly veterans. High-quality career counseling helps 
workers reconnect with employers. We can all agree that 
military veterans deserve to have a job waiting for them when 
they make the transition back to civilian life.
    And I am pleased to see your proposal to help States 
develop paid-leave policies. At some point in our working 
lives, nearly all of us will need time off to deal with a 
serious illness or care for a child, yet only 40 percent of 
American workers have access to paid medical leave, and only 13 
percent can access paid family leave. It should not be like 
this. Paid leave should be a fundamental right for all 
Americans, and your proposal would move us in that direction.
    On the worker protection side, your budget includes a 
request for an additional 300 investigators at the Wage and 
Hour Division to protect low-income workers against wage theft 
and funds for the Office of Federal Contract Compliance to 
address racial and gender pay discrimination. I applaud you for 
making this a priority.
    I also applaud you for the funding for the Women's Bureau 
as well.
    I do not agree with every proposal in the budget. I am 
disappointed to see level funding for the Senior Community 
Service Employment program. It is a great way to help low-
income older Americans earn a paycheck while contributing to 
their communities.
    Overall, this request moves us in the right direction. The 
investments in this budget are necessary to help the millions 
of Americans who continue to be left behind in this recovery. 
The problem, of course, is that you are starting from a base 
budget that has been cut by an inflation adjusted 
$2,700,000,000 over the past 5 years. Around $1,200,000,000 has 
been taken from the job training programs that serve workers 
who have been laid off as well as disadvantaged adults and 
young people. The employment service, which provides universal 
access to counseling and intensive services for job seekers 
looking to learn new skills, has been cut by 13 percent. Worker 
protection agencies have lost 6 percent. The TAACCCT program, 
which helped train displaced workers for good-paying jobs in 
high-demand industries, has not been extended.
    Because of this year's scale of these setbacks, the present 
request, for all its good points, would replace less than half 
of the funds the Department has lost since 2010.
    We need to do better. We need to eliminate the 
sequestration caps once and for all. We need to find new 
sources of revenue, including by shutting down tax loopholes 
and ending tax breaks for special interests. And we need to 
return to adequate levels of funding. Our Nation's working 
families cannot wait any longer. I thank you, and I look 
forward to your testimony and our discussion.
    Mr. Cole. Thank the gentlelady.
    Mr. Secretary, you are now recognized. Your complete 
statement will be placed in the record, and you are recognized 
for whatever opening remarks you care to make.

                   SECRETARY PEREZ OPENING STATEMENT

    Secretary Perez. Thank you, Chairman Cole. It is an honor 
to be here.
    Ranking Member DeLauro and members of the subcommittee, it 
is always good to be back. And thank you for allowing me to 
testify about our fiscal 2016 budget.
    I appear before you today with a great sense of optimism 
about the direction of our economy and the role that the Labor 
Department can play in sustaining and further accelerating this 
recovery. The United States has experienced 60 consecutive 
months of private-sector job growth, the longest streak on 
record: 12 million jobs created during that period. There are 
now more than 5 million job openings as we sit here today, the 
most since January of 2001.
    During the depths of the Great Recession, there were 
roughly seven job seekers for every available job position. 
Today the ratio is less than 2 to 1, but we have more work to 
do, undeniably. The challenge is ensuring shared prosperity for 
everyone, making sure that everyone willing to work hard and 
play by the rules can benefit from this recovery.
    So we still have more work to do on the long-term 
unemployed. We still have more work to do to raise real wages. 
And we need to make sure that we have a steady pipeline of 
skilled workers so that our economy remains competitive in the 
21st century.
    This proposed budget invests in evidence-based programs 
that support an economy that works for everyone, an economy 
that creates opportunities for workers to upgrade their skills, 
work in safe conditions, support their families, and protect 
their hard-earned retirement savings. Each year, on average, 
our network of roughly hundred 25 American Jobs Centers serves 
about 14 million people, including 1 million veterans through 
our core workforce services. And we are serving them well: 55 
to 60 percent of those who come to AJCs without a job are 
working within 3 months of leaving our programs. The outcomes 
are even better for those who get training through the 
workforce system. Almost 80 percent of them find work within 3 
months.
    In 2014, we put approximately $1,000,000,000 in job-driven 
grant money on the street. These are competitive grants. All of 
it designed to help people up-skill in a way that helps them 
move into in-demand jobs that are available now or will soon be 
available.
    We are also doing more to coordinate and integrate our 
workforce programs with those at other Federal agencies. We are 
imploding stovepipes to make our governmentwide efforts that 
much more efficient and effective. We want to strengthen this 
work with continued investments in proven training strategies 
that will enable more people to punch their ticket to the 
middle class. For instance, this budget includes $100,000,000 
for apprenticeship, an effective learn while you earn training 
strategy that benefits both employers and workers. 
Apprenticeship is a proven gateway to the middle class. I have 
met graduates of programs who are earning $50,000, and over 90 
percent of people are employed within 3 months after completing 
an apprenticeship program. Every Federal dollar spent on 
apprenticeship has a return of roughly $27. As I say to many 
people, it is the other college, except without the debt.
    We also propose an increase of $400,000,000 for employment 
service State grants to support in-person services that help 
unemployed workers access the training and other resources they 
need to find a good job. And to help the long-term unemployed, 
we are proposing more investments in the combined Reemployment 
Services and Reemployment Eligibility Assessment Program, the 
RES/REA, through the UI Program. The combined services will be 
offered to all veterans in the Unemployment Compensation for 
Ex-Service Members Program, as well as those unemployment 
insurance claimants who are most likely to become long-term 
unemployed. People who receive these combined services are much 
less likely to exhaust their UI benefits and more likely to 
have a shorter UI duration, returning to work more quickly with 
higher wages and job retention rates.
    Last July, as Chairman Cole correctly pointed out, Congress 
in an overwhelmingly bipartisan fashion passed WIOA, and we 
appreciate your leadership, Mr. Chairman and Ranking Member 
DeLauro, on this bill. This is the most significant reform of 
the workforce system since the late 1990s. I worked at 
workforce issues from the local government level, from a State 
government level, and now at a Federal level, and this was 
indeed a very, very important development and proof that 
getting people to work and cultivating our human capital, it is 
not a Republican idea or a Democratic idea; it is a 
quintessentially smart idea. It is an American idea, and it is 
something where we have so much in common.
    WIOA aligns with everything that we have been doing in the 
administration, and it provides a clear blueprint moving 
forward. It allows us to continue our transformation in the way 
we prepare people for the careers of today and tomorrow, and it 
allows us to continue to building what I call a skill 
superhighway with onramps and offramps, where people can pick 
up skills and credentials on the way to their destination, 
which is a good middle-class job. With WIOA, we are able to 
strengthen our job-driven approach to training and build 
unprecedented partnerships with employers, connecting 
businesses that want to grow with workers who want to punch 
their ticket to the middle class.
    I refer to us, Mr. Chairman, as match.com. We match job 
seekers who want to punch their ticket to the middle class with 
businesses who want to grow using the secret sauce of community 
colleges and other partnerships along the way. And, as someone 
who has worked in this issue, I recognize the remarkable 
importance of what we are doing.
    I want to mention one other issue that I know is of great 
importance to you, Mr. Chairman. Plagued by high unemployment 
and barriers to success, people in Native American communities 
too often don't get a chance to reap the rewards of a thriving 
economy. And the Department is working very hard to change 
that. We have requested an increase to our Division of Indian 
and Native American Program budget to allow us to reach more 
participants, but we also want to see tribes competing for the 
various competitive workforce grant programs. That is why we 
recently issued a very important memorandum directing DOL 
agencies to include tribes and tribal organizations in their 
grant solicitations. We heard this in our listening sessions, 
and we have put what we heard into action.
    Training and skill developments are just one aspect of the 
work that we do at the Department of Labor. And I want to shift 
briefly to some of the other work we are doing.
    Our budget for--request for fiscal year 2016 includes 
$1,900,000,000 for our worker protection agencies, enabling 
them to meet their responsibilities to safeguard the health, 
safety, wages, working conditions, and retirement security of 
American workers. That includes an additional $30,000,000 to 
hire Wage and Hour Division investigators who protect 
vulnerable workers and ensure they receive fair wages. It 
includes $990,000,000 to MSHA, OSHA, and our State partners to 
keep workers safe and to strengthen whistleblower protections. 
And it includes funding to ensure that our Employee Benefit 
Security Administration can provide protection for the pension 
and health benefits that folks have so earned throughout their 
careers.
    I believe there are a number of opportunities in this 
budget, Mr. Chairman, where we can find common ground, work 
together to help people, and I also am prepared to answer 
questions about H-2B because we have been working 24/7 on that 
very important issue.
    I look forward to talking to you about WIOA implementation 
because that has been an all-hands-on-deck partnership with 
Republicans, Democrats, and our team. And I look forward to 
answering any other questions that you and other members of 
this committee have for me today.
    Thank you for your courtesy and thank you for your 
commitment to getting Americans back to work in good jobs that 
pay good money.
    [The information follows:]
    
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    Mr. Cole. Thank you very much, Mr. Secretary.
    The chair wants to announce that I will be enforcing the 5-
minute clock, but the Secretary got extra time because he 
followed the chairman and the ranking member and has green on 
today.
    So, for those of you that don't, I will be much tougher on 
the clock.
    Let me start with an area that I mentioned and I know that 
you are focused on and talk to you a little bit about the 
skills gap. As I mentioned in my comments and you reflected in 
your own, we have got a lot of job openings out there, which I 
think is very good news for the American people, but our labor 
participation rate remains low. And there are simply too many 
workers looking for work that have dropped out of the 
workforce. And employers are having a tough time finding the 
workers that have the skills that they need. The skills gap is 
a bipartisan concern on this committee. I have heard it 
mentioned by Members on both sides. I particularly hear it when 
I talk to employers in my own district. They have got jobs. 
They want to be able to hire people. They are having a tough 
time finding folks that have the skills they need.

                               SKILLS GAP

    Can you quickly detail what you are doing at the Department 
of Labor to address the skills gap and why we haven't seen more 
results, why we keep having this persistent problem, because we 
have spent a considerable amount of money over the years on a 
bipartisan basis to try and train up the workforce to get them 
ready for, you know, different jobs as they emerge.
    Secretary Perez. Thank you for your question, and we have 
spent a lot of time on this, and I am actually very proud of 
the work that we have done. And the ``we'' in that sentence is 
everyone in this room and in this administration.

                       LABOR FORCE PARTICIPATION

    On the issue of labor force participation, the good news 
about the decline in the unemployment rate is that over the 
last year, for instance, the labor force participation rate has 
been essentially flat so you know, sometimes the unemployment 
rate goes down for a bad reason; sometimes it goes down for a 
good reason. When you have basically flat labor force 
participation over the last year, the primary reason we have 
seen the reduction in unemployment is because more people got 
jobs. A substantial percentage of those were long-term 
unemployed. Our long-term unemployment rate is still too high, 
and we still have work to do. We have had an all-hands-on-deck 
approach to this.
    The 5 million jobs, even in the depths of the Great 
Recession, in any given month, you had roughly 2 million job 
openings. In the churn of a 140-million-person economy, in 
terms of jobs, you always have some job openings at one point 
or another.
    But your point is absolutely spot on in the sense that 
everywhere I go I have--it is Groundhog Day. I have the same 
conversation, and it is a good one. You know, I want to grow my 
business, I hear from business owners. I am bullish about the 
future, and one of my biggest challenges is, how do we build 
the skilled workforce?

                   BUILDING A MORE SKILLED WORKFORCE

    That is what WIOA is doing, is we are taking partnerships 
to scale. You know, we have a number of different agencies that 
have training dollars, and we have imploded stovepipes. We have 
created a skills cabinet, and I have the privilege of chairing 
it. I will be traveling later this week with Tom Vilsack to 
Georgia. We are working together to get SNAP recipients 
pathways to in-demand jobs so that they can get off of food 
stamps by having a good job with a career pathway. So we have 
been imploding stovepipes that way.
    Our investments in apprenticeship are another example. 
Apprenticeship is something that, as a Nation, we have 
regrettably devalued over decades. I go to Germany. It is not a 
surprise that their youth unemployment rate is less than half 
of ours because apprenticeship is something that has stature. 
It is a proven pathway to the middle class. We have a 
$100,000,000 competitive grant proposal that is designed to 
lift apprenticeship right now and not only in the skilled 
trades, but it has application in IT, in health care, in 
cybersecurity, and in logistics. There is a UPS training 
facility 15 miles from here that does great training for 
apprentices working at UPS.
    Of the 5 million job openings right now, 500,000 are in IT. 
So we announced a tech hire initiative last week, and we are 
putting $100,000,000 in a competitive grant proposal helping 
people to up-skill. So when I talk about match.com, a big part 
of what we are doing, for instance, in the manufacturing 
context, through these manufacturing hubs that started in 
Youngstown, OH have had support on a bipartisan fashion, is we 
are taking those folks who used to work at the Bethlehem Steel 
plant who have lost their jobs, and we are retooling them and 
putting them to work in advanced manufacturing in places across 
this country. It is very exciting to get out there.
    The challenge moving forward, Mr. Chairman, it seems to me 
is to sustain the momentum of TAACCCT. So we had four rounds of 
$500,000,000 a year, and I can take you to communities across 
this country where they have built pipelines to healthcare 
jobs; they have built pipelines to IT jobs. What we need to do 
is sustain and scale that momentum. We know what works. 
Partnership works. Building what I call that skill superhighway 
where you have onramps for apprenticeship, where you have 
onramps for veterans, where you have onramps for people with 
disabilities, and where you are redefining, as we have done 
through our grant making in partnership with the Department of 
Education. We are creating 6-year high schools, where people 
come into those schools; they have a partnership with, for 
instance, in Chicago, IBM. These kids have mentoring 
opportunities and externship opportunities, they leave with 
either a 2-year degree, or some leave after high school, and 
they are going to 4-year college because they are dreaming big. 
So the key moving forward, I think, we know the ingredients of 
success and we are going to----
    Mr. Cole. Secretary, don't push the green tie too far. You 
exhausted my time.
    Secretary Perez. I just--I get really excited about this 
because there is a lot of stuff----
    Mr. Cole. I can tell, and I appreciate that.
    Secretary Perez. And I apologize.
    Mr. Cole. No. You don't have to apologize, but I will have 
other questions. So if we can scale it down a little bit, that 
would be helpful to me. But let me move now to my ranking 
member, the distinguished lady from Connecticut.

                             TAACCT PROGRAM

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    Mr. Secretary, I am pleased that you talked about the 
TAACCCT program. I will say that, in Connecticut, it is a 
partnership between community colleges and the healthcare 
industry to train veterans, dislocated workers, for new 
careers.
    I wanted to--how are you recruiting the working with the 
community colleges, the apprenticeship grants? What is the 
process of the linkage between H-1B grants, community colleges 
that build on the TAACCCT program? Because, as you know, the 
TAACCCT program is not offering any new awards now. So I want 
to know what the follow-on piece is with regard to H-1B 
apprenticeships, how you are linking with the community college 
aspect of it.
    I am going to just do a second question at the same time. 
That is--I know that, Mr. Chairman--I have learned from your 
experience.

                                REA/RES

    Your budget request is a $181,000,000--it is about 
$101,000,000--to enhance the reemployment services for UI 
claimants who have gone back to the workforce. This is REA with 
reemployment with RES, and that combination. Talk about that 
model a little bit and dealing with reemployment and preventing 
long-term unemployment. And if you get a chance, the P2E 
program, where you have provided Federal funds in Nevada and 
how is that helping with long-term unemployment.
    Secretary Perez. Well, REA/RES is a proven model. We 
learned many reasons from the Great Recession. When you get 
these services early to people----
    Ms. DeLauro. How is it working? How does it work?
    Secretary Perez. We work at our American Jobs Centers 
through our UI offices with face-to-face interactions with 
people who are job seekers, getting them connected to what they 
need to succeed. Some people just need a resume dustup and some 
job leads. Other people have other structural barriers. So, you 
know, one of the basic principles of effective workforce 
development is you take the job seeker where you find them. 
Some folks have a Ph.D.; they lost their job. Some folks are 
eighth grade educated. The workforce system must be able to 
address and help everyone.
    REA/RES does exactly that, giving the array of tools so 
that you can have early intervention. It is a proven model, and 
it has had bipartisan support in this Congress during, you 
know, a number of periods. So the key is it reduces the 
duration of UI benefits. When you can reduce duration by 
getting them back into work, that is critically important.

                    AMERICAN TECHNICAL TRAINING FUND

    As it relates to your other question about----
    Ms. DeLauro. Just a second. How does it relate to what--the 
Department of Education has the American Technical Training 
Fund. Is there a relationship with that effort?
    Secretary Perez. That was my second part of the question 
because the American Technical Training Fund is basically 
TAACCCT 2.0. We have been working very closely, and under that 
proposal, we would co-administer it. It is funded at the 
Department of Education, but we have been attached at the hip. 
We have imploded that stovepipe quite a long time ago, we are 
working together with them, and we want to continue the 
momentum of bringing community colleges together to serve as 
that secret sauce of job creation and skill development for so 
many people.
    These are all linked, our apprenticeship grants, our other 
H-1B grants, our tech hire. These are all bringing together key 
stakeholders around vision of creating pathways to in-demand 
jobs that pay a good middle-class wage.
    Ms. DeLauro. Just add to that, if you will, how the 
expanded program works with your request for an additional 
$400,000,000 for employment service offices in the One-Stop 
Career Center network. I am trying to--what is that----
    Secretary Perez. That is the epicenter. You know, during 
the Great Recession, the American Job Centers were the 
emergency rooms for job seekers. They were seeing 15 million 
people, and they continue--actually, I believe last year 14 
million people came through American Job Centers, and so when 
Chairman Cole asks the appropriate question, how do we scale 
this work, that is how we scale this work, by getting more 
resources so that more folks can be helped because the demand 
continues to be there.
    Ms. DeLauro. Just to the committee, I would say this. In 
two other areas of the Labor/HHS bill we have something known 
as a cap adjustment. It is a budget designation for programs 
that create savings in mandatory programs, Medicare, Medicaid, 
Social Security. We used to a partial cap adjustment for REAs 
because they save money in the UI program. Unfortunately, 
Budget Control Act eliminated the cap adjustment for REAs.
    I believe it is shortsighted. I would like to work with my 
colleagues to reestablish that cap adjustment if we can help 
veterans and other unemployed workers return to the workforce 
while at the same time we save money. I don't know anyone who 
would not want to do that. So I look forward to talking to you 
about that, Mr. Chairman.
    Mr. Cole. Look forward to the discussion.
    Distinguished Member from Maryland is recognized.
    Mr. Harris. Thank you very much, Mr. Chairman.
    And good to see again, Mr. Secretary.
    Secretary Perez. Good morning. Good to see you, 
Congressman.

                                  H-2B

    Mr. Harris. I am going to just briefly ask a couple things 
about the H-2B because it is coming to my attention that, you 
know, on March 4, I guess it was a district court judge in 
Florida struck down the ability of the Department of Labor to, 
I guess, issue rules and regulations, which in my mind would 
just return the DOL to the consultative role they played before 
2008, before the 2008 rule. So I have got to ask you, why in 
the world did--why didn't the Department just return to the 
consultative role? Why did they shut down H-2B applications? 
You know because you are from Maryland. I mean, that is 
devastating to my district. You know, closing down H-2B 
applications is devastating, and the first domino was DOL shut 
them down on March 4, and then DHS shut them down March 5 
because they can't do it without DOL without the consultative 
role.
    What was the thinking behind the decision to just shut down 
applications instead of just returning to a consultative role?
    Secretary Perez. Well, we are doing much more than just 
shutting down the program, Congressman.
    Mr. Harris. You did shut down the program on March 4. Is 
that--Mr. Secretary, I am right, though. The program right now 
is shut down.
    Secretary Perez. We were told by a court that we lacked the 
authority to issue rulemaking and run the program, and so----
    Mr. Harris. Correct. So my question is very specific: Why 
didn't you return to the consultative role that was present 
before 2008 and continue to allow the applications to be 
processed? It is a very simple question.
    Secretary Perez. Because we don't have the authority to 
process applications if we don't have the authority to issue 
rulemaking or issue guidance, and so here is what we did do.
    We have been working very closely with the Department of 
Homeland Security. Last night we filed a motion with the court 
with the approval--or the lack of objection on the other side 
so that we can immediately get the order of the court stayed so 
that we can open the program back up. We have made a commitment 
to have an interim final regulation in place by the end of 
April.
    I am acutely aware, having been the labor secretary in 
Maryland, of the importance of the H-2B program. I have had 
many conversations over many years with Senator Mikulski and 
others.
    Mr. Harris. So did--and I am not--and, again, I am limited 
to 5 minutes here.
    So did you in fact, I mean, concurrently with this--
because, look, you are depending upon the court to stay the 
order. If the court doesn't stay the order, we are shut down. 
So are you trying an interim--an interim emergency rule with--I 
mean, is that in the process? Because my understanding is DHS 
can come up with an interim emergency rule, could go into 
effect immediately upon publication, that would reopen the 
process.
    Secretary Perez. Again, we filed a motion last night to 
stay the proceeding, and we have made a commitment to an 
interim final rule to have in place by the end of April. We are 
working 24/7----
    Mr. Harris. No. Why is it going to take a month and a half 
to do an interim final rule?
    Secretary Perez. Congressman, this----
    Mr. Harris. It will be 2 months, actually, after March 4. 
It will be 2 months to do it.

                        H-2B PROGRAM LITIGATION

    Secretary Perez. This program has been the subject of 
litigation since the Bush Administration. To put a rule in 
place in a program that has had the complexity--this is a 
Lawyer's Full Employment Act, the H-2B program. That is 
something I am confident we can agree on.
    Mr. Harris. I got it.
    Secretary Perez. Every time we do something, whether it was 
the Bush administration--they got sued by someone--whether it 
is the Obama administration. One thing that is a constant in 
the H-2B context is litigation, and so----
    Mr. Harris. So you didn't see this shutdown coming, this 
potential court ruling? You really thought that since the court 
already ruled on the 2012 rule and invalidated it, the 2012 
action, you didn't see this coming? Were there plans for this?
    Secretary Perez. We didn't think the court had the 
authority to do this. I just outlined our plan, which is 8 
weeks to put--or 6 weeks to put an interim final rule in a 
program of the complexity of this nature is about--is warp 
speed, I would say.
    Mr. Harris. Mr. Secretary, and that is just because you 
just didn't think the court was going to rule the way it was. 
So there was no plan B in case that court issued that ruling.
    Secretary Perez. Well, of course, we have a plan B, and the 
plan B is we are doing an interim final rule because what we 
were doing up until the court ruled was we were working 24/7 to 
process all the applications. That was the appropriate use of 
our resources. When the court told us we no longer had the 
authority to process those applications, we immediately went to 
determine how can we get this program running as fast as 
possible.

                              SILICA RULE

    Mr. Harris. Thank you. And, again, I just have one final 
question that brings up some things about the silica rule, 
which I think I asked you before last year. You know, I am very 
concerned because, you know, one of the greatest driver of jobs 
and economic growth right now is in fact the energy industry. 
And, you know, the major change in the energy industry is that 
we do horizontal drilling, hydraulic fracturing, which uses a 
lot of sand. Sand is silica, and, you know, the disappointment 
is that it is unclear that OSHA are making its determinations 
of how to measure silica on a scientific basis, about whether 
the collection process is valid. And then I just have to ask 
the question, because I didn't get an answer in a letter I 
wrote in 2013 to--Chairman Kingston and myself--to Dr. Michaels 
is why doesn't the rule permit as primary dust control the most 
advanced and effective form of engineering control, a personal 
air-filtered helmet, which I know very well from the operating 
rooms; they work kind of great. I would imagine they work well 
in silica.
    Can you enlighten me on why we are not making it easier to 
use--to do hydraulic fracturing and open those job 
opportunities and not more difficult?
    Secretary Perez. Well----
    Mr. Cole. Before you respond, real quickly, I am going to 
certainly allow you to answer the question, but I would advise 
members, please don't push the Secretary right to the red light 
and then--because then you are----
    Mr. Harris. I am not wearing green. I had to.
    Mr. Cole. Well, I know. So I might just cut you off, but I 
have such great affection for the Member of Maryland, and I 
want to allow the Secretary to respond because I think it is a 
very important question, but I just ask Members going forward, 
please give the Secretary enough time to respond.
    Mr. Secretary.
    Secretary Perez. We have known, Congressman, that silica is 
deadly for decades. Literally, Frances Perkins--there is a 
recording of Frances Perkins in 1937, long before hydraulic 
fracturing was out there, talking about the dangers of 
silicosis and silica exposure.
    The OSHA rule went to great lengths to ensure that we 
considered the interests of the hydraulic fracturing industry 
in our rulemaking process. We devoted a lengthy appendix to the 
preliminary economic analysis to assess the impacts of the 
proposed rule on the hydraulic fracturing industry. 
Representatives of this industry have provided written comments 
on the proposed rule, we had a series of public hearings 
because we know how important this rule is, and we wanted to 
make sure that everybody had an opportunity to be heard. We are 
in the process of taking all of the comments and all of the 
public hearing to understand what that means in the process of 
crafting a final rule.
    Mr. Cole. Thank you very much, Mr. Secretary.
    My good friend, the gentlelady from California, is 
recognized.

                WORKFORCE INNOVATION AND OPPORTUNITY ACT

    Ms. Lee. Thank you, Mr. Chairman.
    Let me thank you, Mr. Secretary, for being here today, but 
I also thank you very much for your tremendous work and your 
leadership at the Department.
    Secretary Perez. Thank you.
    Ms. Lee. I wanted to also just mention how impressed I was 
that, with regard to the Workforce Innovation and Opportunity 
Act, you went around the country and took input from State and 
local workforce leaders and practitioners. I think that is 
going to really prove to be part of the success of this entire 
implementation.
    Also I want to thank you for your focus on STEM and high-
tech jobs. I think your request has a large increase for IT 
modernization, from approximately $18,000,000 in recent years 
to a total of $120,000,000. This is surely needed, sorely 
needed, and I want to know what you are doing as it relates to 
expanding diversity in STEM workforce, including women and for 
opportunities for people of color.
    And let me just read to you some of these statistics, 
because you know we have been pushing to get these Silicon 
Valley companies to release their data on work--on the 
workforce.
    You have Apple: 11 percent Hispanic; African-American, 7 
percent. Google workforce: 3 percent Hispanic; 1 percent 
African--no, 2 percent Hispanic; 1 percent African-American. 
Facebook: Hispanic, 4 percent; African-American, 2 percent. 
Twitter: African-American, 2 percent; Hispanic, 3 percent. When 
you look at eBay, you are talking about African-American, 7 
percent; Hispanic, 5 percent. When you are talking about 
Microsoft, you are taking about African-American, 3.5 percent; 
Hispanic, 5.1 percent. Yahoo: African-American, 2 percent; 
Hispanic, 4 percent. LinkedIn: African-American, 2 percent; 
Hispanic, 4 percent. Pandora: Hispanic, 7 percent; African-
American, 3 percent.
    I could go on and on. But you see the picture, and I hope 
you understand why I am concerned that the solicitations for 
these new apprenticeship programs and for your IT modernization 
have requirements in there that you seek--that organizations 
applying for these funds have a strategy to address and target 
the populations that are most underrepresented in the IT field. 
And I will give you an example. This $100,000,000 that you just 
announced, the partnership, which I think is a great idea, but 
just coming from my area, the area where the population of 
underrepresented minorities are you didn't include in that 
overall strategy. And so I want to make sure that, as you move 
forward on this, you don't forget that, you know, given 
unemployment rates in the African-American and Latino 
communities and what is taking place in terms of the high-tech 
industry, you have got to figure out a way that we direct and 
target and require these proposals to address the 
underrepresented people of color who have been shut out, quite 
frankly, from the IT world.
    Secretary Perez. Congresswoman, first of all, thank you for 
your leadership in this area. I enjoyed our visit we did that 
day with the upscaling program in your district.
    I wholeheartedly agree that opportunity needs to be 
available to everyone, and it can. And I was with a guy named 
Freeman Hrabowski the other day. I encourage you to spend time 
with him. He is the President of the University of Maryland, 
Baltimore County. They have produced more minority scientists 
and engineers than just about anyone in the country. He has 
figured this out. It can be done. That is exactly what we are 
doing through our investments.
    The apprenticeship, $100,000,000----
    Ms. Lee. Mr. Secretary, the companies aren't hiring them.

                      APPRENTICESHIP GRANT PROGRAM

    Secretary Perez. Well, actually, Freeman is doing a great 
job of that. It can be done, and what we need to do is show the 
best practices and show it to others, and I have watched him in 
action, and so those who say there is not a pipeline out there, 
there is a pipeline, and we need to expand the pipeline.
    In the apprenticeship program, just to give you an example, 
and I did want to correct something here, the apprenticeship 
grant program, you will not get a grant if you do not have a 
plan for making apprenticeship accessible to historically 
underserved communities. That is very explicit in the grant 
proposal because our goal is to make sure--and when we 
announced this grant, I was with Mayor Nutter in Philadelphia. 
We were at an IT institute that is taking kids of color from 
the Philadelphia public school system and providing them 
through the Earn While You Learn model with Pathways to 
Prosperity in IT. The Tech Hire Program, which is going to be 
accompanied by another $100,000,000 competitive grant proposal 
is all about getting employers to commit to providing pathways 
to opportunity. There are 500,000 tech jobs right now, IT jobs, 
and this grantmaking is directly targeted at making sure that 
everybody has an opportunity to succeed. I think we can do it. 
And these grants are going to help us learn best practices.
    Mr. Cole. Thank you.
    Just by going by order of arrival, actually, Mr. Dent is 
next. So we will get the gentlelady from Alabama coming back 
after Mr. Rigell.
    Mr. Dent.

                        ESOLVING H-2B LITIGATION

    Mr. Dent. Thank you, Mr. Chairman.
    And, Mr. Secretary, good to be with you.
    On the H-2B issue, we have gone to the--I appreciate this 
interim fix. Are you dedicated to trying to find a permanent--
oh, I am sorry. Just turn that on--are you dedicated to finding 
a permanent resolution to this issue? That is my main concern. 
And what steps are you taking to move in that direction?
    Secretary Perez. Absolutely. We are absolutely dedicated to 
that, sir, and what we are doing is we have committed to having 
an interim final rule by the end of April, which would go into 
effect immediately but have a comment period. During that 
comment period, we will obviously listen and learn a lot from 
the key stakeholders and turn an interim final rule into a 
final rule. This has been the litigation machine here, and the 
H-2B context has been ongoing literally since the Bush 
administration.
    As someone who has been very involved at a State level in 
H-2B, I recognize the importance of the program, and clearly 
the importance of having a long-term fix. So I look forward to 
getting whatever ideas that you and your constituents have 
toward that end.

                         COMPLIANCE ASSISTANCE

    Mr. Dent. Yeah, it is a very important issue where I live 
just as it is in Maryland and many other places.
    Most small employers do not have a dedicated employee to 
track changes in statutes and regulations of--and the business 
owners end up doing this work after hours in terms of 
compliance. Unfortunately, due to the avalanche of Federal 
regulations currently smothering small employers, the employer 
can often be unaware of what is expected of him or her. Instead 
of penalizing job creators, the Department should instead try 
to help them.
    At present, your agency has approximately 1,500 individuals 
enforcing OSHA standards and approximately 250 individuals 
tasked with compliance assistance for companies that want to 
follow the law.
    Mr. Secretary, with a need for safe workplaces, why have 
you requested funding for additional enforcement employees but 
not for employees devoted to compliance assistance?
    Secretary Perez. We have had a program, not simply in OSHA 
but really across our agency, whether it is OSHA, OFCCP, Wage 
and Hour, compliance assistance is a very important tool in our 
tool kit. In fiscal year 2014, OSHA's field offices conducted 
more than 5,000 outreach activities for workers and employers 
to help promote compliance. OFCCP conducted 580 compliance 
assistance activities; Wage and Hour, 2,300. I am a big 
believer in an ounce-of-prevention theory.
    I am also a believer that you also need to enforce, and I 
believe that because I talk to employers who play by the rules 
who tell me, you know, I am competing for Federal contracts. I 
don't get them. I know the guy who got the contract is 
cheating. They need to be held accountable. So I think we--it 
is never an either/or. It is a both and then some.

                          OSHA COMPLIANCE RATE

    Mr. Dent. Thank you.
    OSHA has admitted it has only been able to achieve about a 
70 percent compliance rate with the existing silica standard. 
So why is OSHA going a step further with the scarce budget 
resources it has to develop a new standard that is 
technologically and economically infeasible? And shouldn't OSHA 
instead use its limited resources to improve compliance rates 
for the existing standard, which has resulted in a 93 percent 
drop in silicosis deaths?
    Secretary Perez. Well, I would respectfully disagree with 
the notion that it is technologically or technically 
infeasible. I would simply point out that we are trying to save 
lives here. Exposure to silica kills. I met a guy who actually 
is from Buffalo, where I grew up, a guy named Alan White, and 
he can't walk from one end of the room to the other without 
having to sit in a chair for a little while and help himself 
because of the effects of silica.
    I think that everybody who goes to work in morning ought to 
be entitled to know that they are coming home safe and sound, 
and the effects of silica have been well documented for 
decades. We have had a very, very long and appropriately 
inclusive rulemaking process so that we can get all of the 
input from the various stakeholders, including holding 
hearings.
    Mr. Dent. The only thing I would say is that, you know, 
what is left of the existing foundries in this country are very 
much at risk right now. And we may lose that capacity all 
together. We all want to deal with silica, but I think there 
are ways to deal with this in a technologically feasible 
manner.

          PROPOSED SILICA RULE IMPACT ON CONSTRUCTION INDUSTRY

    And contrary to OSHA's own analysis, independent estimates 
show that the agency's proposed rule to regulate worker 
exposure to crystalized silica is expected to cost the 
construction industry over $4 billion a year to comply with it, 
a new lower permissible exposure limit, and costs the 
engineering control solutions, which may not even be feasible 
to achieve the lower protection level. And due to the 
uniqueness of the construction industry with its transient 
workforce, ever-changing working environment, and vast numbers 
of tools and trades involved, will OSHA commit to instituting 
alternatives which are technologically and economically 
feasible for construction industry that meets OSHA's goal of 
protecting workers from silica exposure?
    I mean, it is the foundries. It is construction workers. I 
am hearing this from all sorts of folks, and I just would like 
to hear your comments on this.
    Secretary Perez. Well, part of the rulemaking process is 
the economic analysis, the cost-benefit analysis. We have 
received voluminous amounts of comments toward that end, and we 
appreciate all those comments, and that is part of what we are 
doing right now is processing those comments, taking them into 
account. I am very pleased that we slowed that process down so 
that we could have all the public input that we have gotten.
    Mr. Cole. Again, I am going to ask members, you know, give 
the Secretary a break. Don't ask your question right when the 
light goes red. Okay?
    Mr. Dent. I have green in this tie.
    Mr. Cole. I know. That is why it is only a mild reproof.

                        FULL COMMITTEE CHAIRMAN

    As I advised the committee earlier, when the chairman 
arrived, we would interrupt so that he could make whatever 
statement he cared to make. We will certainly do the same for 
the ranking member when she arrives, if she has a statement to 
make as well.
    So, Mr. Chairman, you are recognized.
    Chairman Rogers. Thank you, Mr. Chairman, for that 
courtesy.
    Secretary Perez. Good morning, Mr. Chairman.
    Mr. Rogers. Mr. Secretary, I apologize for being late. We 
have got three hearings this morning I am trying to bounce 
around from. But thank you for yielding me this time, and I 
will be brief.

                         FY 2016 BUDGET REQUEST

    Secretary, we are pleased to have you with us this morning 
to talk about the President's request for Labor. Your 
Department, of course, plays an essential role for the American 
worker, ensuring that jobs are plentiful, and sustainable, and 
safe.
    Unfortunately, many Americans are still struggling under 
the weight of our lagging economy to find meaningful 
employment. In my district alone, Mr. Secretary, as you know, 
we have lost about 9,000 coal-mining jobs in the last few 
years.
    With the DOL's focus on workforce training and development, 
your Department has a lot to offer in areas confronting similar 
situations across the country, pockets of poverty, if you will.
    I particularly appreciate your engagement with the 
bipartisan SOAR initiative in eastern Kentucky, Shaping Our 
Appalachian Region, SOAR, and I look forward to working with 
you as we strive with the Governor of the State to strengthen 
and grow the economy in that region.
    While I do very much appreciate your partnership, I, 
unfortunately, find many aspects of the budget request somewhat 
troubling. The fiscal 2016 request includes discretionary 
spending--funding of $13,180,000,000. That is over 10 percent 
of an increase over current levels. That includes billions for 
new proposals and assumptions that Congress will sign off on 
shifting programs and activities from discretionary to 
mandatory budget authority.
    The job-driven training proposals, totaling $21 billion in 
mandatory spending, is larger than the entire Labor 
Department's discretionary funding request.
    This administration and your Department need to work on 
reducing the problem of mandatory spending, not adding to it. 
This runaway spending, if we allow it to continue on 
autopilot--mandatory--threatens to squeeze out all of the 
worthwhile programs that many of our constituents care for, 
including a number of critical programs under your charge.
    Besides the huge increase in mandatory spending, the fiscal 
year 2016 request requests significant discretionary funding 
for new programs and sizeable increases for others. The request 
for information technology provides a good example. In your 
request, we see $61,000,000 for a new digital government 
integrated platform initiative. A total of $120,000,000 for IT 
modernization. That is a 677 percent increase. And multiple 
requests of $3,000,000 to $5,000,000 for agency-specific IT 
improvements throughout the Department. Technology is certainly 
important in today's society, but these increases appear to be 
out of line in light of tight budget constraints, and I look 
forward to hearing from you at some point in time about why you 
feel these investments are absolutely necessary to that extent.

                            WIOA REGULATIONS

    Finally, in July 2014, the Workforce Innovation and 
Opportunity Act, WIOA, was enacted. An aggressive timeframe for 
the Department of Labor and the Department of Education to 
publish a set of regulations is plainly laid out in this 
legislation. One of the requirements of the act was the 
publication of the proposed regulations by January 18 of this 
year. Instead of working diligently to meet the deadline 
required by law, your agency decided to set its own deadlines 
and plan to publish the proposed regulations in the spring of 
2015.
    Mr. Secretary, for an administration that is overly fond of 
regulation, it amazes me that this process wasn't completed on 
a more timely basis. I hope you can shed some light on that.
    Mr. Secretary, thank you for being with you us today. The 
committee takes seriously our role in overseeing the budget 
policies of the Department of Labor, and I appreciate your 
continued engagement with us. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you.

                          Ranking Member Lowey

    Again, following what I had laid out earlier, I see we have 
been joined by my good friend, the distinguished ranking member 
of the full committee. So we will go to her next for any 
comments she cares to make, or if she wants to make some 
questions. We know you two have a very busy schedule today.
    Mrs. Lowey. Thank you so much, Mr. Chairman.
    And it is certainly a pleasure, Secretary Perez, to welcome 
you here. I really thank you for joining us, and I apologize 
for missing your testimony. As you know, the chairman and I 
are--wish we had roller skates on--running around to various 
hearings.
    But this is a good opportunity to mark 60 consecutive 
months of private-sector job growth, an increase of 12 million 
private-sector jobs, and an unemployment rate dropping to 5.5 
percent. So we are making good progress.

                        FAMILY MEDICAL LEAVE ACT

    But I have a real question, and I don't understand why we 
can't get this done, and it is about paid leave. As you know, 
the Family Medical Leave Act covers 60 percent of the 
workforce. However, the law only covers unpaid leave, which 
millions of working families can't afford to take. With most 
children living in homes with either a single parent or with 
parents who both work, parents face an impossible choice 
between caring for a loved one and their jobs.
    Not only does paid leave result in healthy outcomes for 
children and parents, but, frankly, it is good for business. It 
improves worker retention, helps employers save money through 
reduced turnover costs. And I am happy to see the fiscal year 
2016 budget request prioritizes paid leave with $35 million 
provided through this subcommittee to assist in the startup of 
new programs and an additional $2.2 billion in mandatory funds 
to expand paid leave in up to five States.
    I recently had one of my treasured employees on paid leave 
because I think it is so important to her, to her family, to 
our office. I am shocked when I keep hearing the number of 
businesses that don't provide paid leave. So I am really happy 
about this.
    How would the budget request to expand paid-leave policy 
strength our economic competitiveness? How many States--and 
this I would be interested in--how many States have expressed 
an interest in exploring paid-leave policies? Would your budget 
request be sufficient to help those States develop policies 
that are right for them? Frankly, it shocks me that more 
States, more employers, don't do this on their own just to get 
the best employees.
    But if you can respond, that would be helpful.
    Secretary Perez. Great. Thank you to both Chairman Rogers 
and Ranking Member Lowey for being here. It is an honor to have 
you here.
    Mr. Chairman, I am sorry that we got snowed out for our 
visit, but I promise you that we have a rain date. I look 
forward to going there. I appreciate your leadership and the 
work that you and Governor Beshear are doing are remarkable 
examples of bipartisanship in action. I think broadband does 
hold a key to helping eastern Kentucky to soar into the 21st 
century, and I look forward to using every tool that we can do, 
use at the Department of Labor to be an important player in 
that.
    I have met people from eastern Kentucky who are 
multigenerational coal miners. I met a guy who is now studying 
to be an EMT, and I understand the adjustment, as a guy who 
grew up in Buffalo and watched some legacy industries go away. 
So I have a real appreciation for what you are doing.

                                  WIOA

    I do want to mention WIOA for a moment because I am very 
appreciative, and I noted that in my----
    Mrs. Lowey. Is there on my chairman's time?
    Secretary Perez. I was going to answer both your questions 
together if I could.
    Mrs. Lowey. I am just teasing.
    Secretary Perez. Because he asked a couple questions--Mr. 
Chairman, asked a couple questions as well, and I wanted to 
make sure I responsive to everybody.
    Mrs. Lowey. That is quite all right as long as our 
distinguished Chairman Cole gets it too. I am always, first of 
all, I am always happy to yield anytime to our big chairman of 
the committee.
    Secretary Perez. I very much appreciate it, and I noted it 
in my opening statement the bipartisan spirit surrounding WIOA. 
It is a game changer, and I am very excited, as someone who 
worked in local and State government on these issues, to be a 
part of it.
    There was about 18 months' worth of work that Congress 
directed us to do in about 6 months. With all due respect, our 
folks didn't take Thanksgiving break; they didn't take 
Christmas break. They were working through the holidays. What 
they did was, as Congresswoman Lee noted before--they went 
around the country to take input because we want to make sure 
when we do rulemaking that we have listened and we have 
incorporated the input of state and local governments because, 
having worked in those areas, I often felt like--bless you--my 
voice wasn't being heard. We wanted to make sure those voices 
were heard.
    We are literally a week or two away from having a proposed 
rule out. It will be over 1,000 pages. It will reflect the 
input that we got, and we got great input from all of the 
Republican and Democratic Members who were involved in this. I 
think you will see that it reflects a voluminous amount of 
work. I appreciate the dedicated career staff who basically 
haven't been on vacation since then. I am confident that you 
will see in that proposed rule, which is literally, a week or 
two away from being published, that a lot of thought and effort 
have gone into it. And we are hearing what you are saying.

                               PAID LEAVE

    And on paid leave----
    Mr. Cole. Can I ask the gentleman to address the 
gentlelady's question----
    Secretary Perez. Yes. And on paid leave----
    Mr. Cole [continuing]. As quickly as you can.
    Secretary Perez. I have traveled the world talking about 
paid leave and learning about paid leave. The thing I have 
learned, Congresswoman, is that it is not a Republican or a 
Democratic issue around the world. You know, the Conservative 
ruling government in Australia won election on a platform of 
expanding paid leave. Canada, U.K., other places that have 
Conservative ruling governments are doing the same. California, 
Connecticut, Illinois, Massachusetts, Minnesota, New York, 
D.C., Los Angeles, New York City are among the areas that have 
these laws.
    We are seeking to help other States. When we put out a 
$500,000 or $1,000,000 grant last year to help States along, we 
got over a dozen applications. And so there is a lot of demand 
out there in State and local governments for this. I think it 
is part of our competitiveness as a Nation that we need to do 
this. I think it is part of getting more women in the workplace 
because you compare our labor force participation with Canada, 
we have fallen because we haven't led on leave.
    Mrs. Lowey. Well, I appreciate that. And I appreciate your 
time. And I just want to make one other statement about paid 
leave because there are some families that have two paychecks 
coming in. And with the two paychecks, they can't still survive 
if one of them didn't take the paid leave. So whatever we can 
do to encourage paid leave, to encourage more private-sector 
companies, States to put in policies, I think is really very 
important.
    Thank you, Mr. Chairman.
    Mr. Cole. You are most welcome.
    The Secretary is very wise to pay appropriate attention to 
the major chairman and the ranking member. But I want to go now 
to the long-suffering Mr. Rigell and Ms. Roby next so they have 
an opportunity to participate in this first round of 
questioning.

                         STATUS OF H-2B PROGRAM

    Mr. Rigell. Thank you, Mr. Chairman, very much.
    Mr. Secretary, thank you so much for being here. We are 
going to go back to the H-2B program. This is of great concern 
to me. And I would like to clarify, first, what the exact 
status of it is now. The unopposed motion to stay, the court 
order, until April 15, that you filed, which I appreciate, I 
just want to clarify that did not open up immediately the H-2B 
program, is that correct?
    Secretary Perez. That is correct until the court rules. 
Because it was unopposed, I expect the court and hope the court 
will rule----
    Mr. Rigell. I understand. I don't question for a moment 
your commitment to getting this thing back on track. So we are 
on solid common ground there. That said, I believe after 
careful review of the actual, the court's decision that there 
has been a misinterpretation of that, and it has resulted then 
of actions by the Department which were not necessary. And they 
are really harming certainly Virginia families, and I know from 
other States as well. Our seafood industry right now is reeling 
as a result of this. And however many days are between now and 
whenever the resolution would be under the plan that you are 
pursuing, each day is a day of pain, economic pain.
    And I would like for you to consider the following, that in 
that Perez decision that was recently announced there, it found 
that the Department of Labor lacked authority to issue formal 
notice and comment rules under the APA. There are a lot of 
things it didn't do though. It did not prohibit the Department 
of Labor from complying with its statutory role of consulting 
with Customs and Immigration on H-2B petitions. It did not 
prohibit the Department of Labor from operating under informal 
internal guidance in doing so. It neither directed nor 
prohibited Immigration and Customs from doing anything 
whatsoever. And really, most importantly, it did not require 
nor did it intend--certainly as I read it and as others read 
it--it did not require, nor did it intend that the H-2B program 
be shut down.
    I have a full appreciation for the need to respect and 
comply with the third branch of government. But I really am 
convinced that you have gone, you have taken it too far. And, 
as a result, businesses and families and Americans are hurting. 
So I would ask that you reconsider this in light of what I am 
sharing here and that we give some relief to hard-working 
American families and businesses.
    Secretary Perez. Congressman, I would love to be able to do 
that. I can tell you that I worked on the ports issue because, 
I saw that suffering that the delay out on the West Coast was 
causing to innocent folks.
    Mr. Rigell. We appreciate that.

                      AUTHORITY ON H-2B RULEMAKING

    Secretary Perez. And on two different occasions in related 
H contexts, visa contexts, the Department has tried to do 
exactly what you have suggested. In both cases, courts struck 
down our efforts to say we can issue subregulatory guidance and 
run the program even though we don't have rulemaking authority.
    Once the decision was issued, the first question I asked 
was, well, do we have additional authority through which we can 
run the program now because every day is an important day? 
Again, on two occasions in related circumstances, we tried to 
do exactly what you are outlining. In both cases, a court then 
said, ``No'' means no; you don't have the authority to do the 
rulemaking. I have seldom seen a context where we get more 
litigation. It is what it is. That is why I really agree with 
Congressman Dent's question about having a long-term resolution 
to this. We certainly want to try and get there. But, in the 
short term, our options are limited.
    Mr. Rigell. I am convinced that the court never intended 
for the program to be shut down. If you look back at the 60 
years the Department of Labor has been consulting with USCIS on 
H-2B petitions, it doesn't comport really with just common 
sense that the court would prohibit the H-2B program from going 
forward. And I would think you would have the full support of 
certainly Congress, at least from this Member. And the entire 
premise that we have got to shut this thing down and hurt 
American families is just not right.
    Now, let's move on. I have made my point there. And we are 
going to disagree. And I would like to think there are some 
lawyers that were on the other side of this in your briefing 
that would give you a counter view. And a good case and an 
ethical case could be made for the path that I was just 
discussing. In trying to be respectful of the chairman's time 
here--I think my red light is on--but we have got to revisit at 
some point the application process itself. It is also delayed 
and hurting our businesses in general.
    Thank you, Mr. Chairman.
    Mr. Cole. Thank you. Despite the green tie, I appreciate 
the consideration.
    My good friend, the very patient gentlelady from Alabama, 
is recognized next.
    Mrs. Roby. Thank you, Mr. Chairman.
    Thank you for being here, Mr. Secretary.
    Secretary Perez. Always a pleasure.
    Mrs. Roby. I have some very young family members that are 
here watching our government work. And I am proud to have them 
in the hearing room with us today. So it is always good to be 
able to share these experiences with our young folks.

                       OSHA COMPLIANCE ASSISTANCE

    So, Mr. Secretary, you know I am particularly interested in 
the way that OSHA prioritizes its resources. And to expound a 
little bit on what my colleague, Mr. Dent, talked about in his 
line of questioning, I believe it is wise that we invest our 
limited resources on the front end, helping employers comply 
with safety requirements before we launch aggressive penalties. 
OSHA has consultation programs that help small employers comply 
with OSHA standards and work to improve their injury and 
illness prevention programs. And, in Alabama, we are very proud 
of the University of Alabama-based consultation program called 
Safe State, which is helping small companies who might not have 
a lot of compliance resources achieve the Safety and Health 
Achievement Recognition Program, otherwise known as SHARP. Safe 
State is good for workers. And it is good for business. And I 
know you agree with me because I have heard you say it here 
today, that improving worker safety on the front end is the 
ultimate goal.
    But OSHA issued a policy memo on November 24 of last year 
that established strict entry requirements for these 
consultation programs. And specifically they have made it 
almost impossible for small companies that are part of a larger 
holding company to have access to programs like Safe State to 
make sure that their workplaces are safe and compliant. So, as 
we consider your budget request, the President's budget 
request, I want to count on you to see that such policies are 
reversed and good programs like Safe State are allowed to do 
their jobs and keep workers safe.
    Secretary Perez. Sure. There are two programs that OSHA has 
that relate to providing the compliance assistance that you are 
talking about. One is the SHARP program, the Safety and Health 
Achievement Recognition Program. The target audience for that 
program are small businesses. We also have a voluntary 
protection program for whom the target audience are larger 
business.
    The memo that you referred to was an effort to make sure 
that--what we were finding in the SHARP program is that there 
were a number of large businesses who had affiliates that may 
be smaller, but they were part of a larger business were part 
of the SHARP program. In an effort to deploy our limited 
resources, we wanted to make sure that the SHARP program was 
focused on small businesses that didn't have access to a bigger 
footprint. So, in response to some feedback we got, we have 
announced that everybody who is in the SHARP program will stay 
in the SHARP program. What we are doing for the small 
businesses that are part of bigger businesses, moving 
prospectively, is working with them through our VPP 
program,which is a very similar program. However, that one is 
targeted more at larger businesses. In 2016, our effort is to 
make sure that we have more businesses that are in that 
program. So I share your view that compliance and prevention, 
as I mentioned before, are very important. I think both of 
these programs can get us there. I look forward to working with 
you to make sure that they are operating effectively in Alabama 
and elsewhere.
    Mrs. Roby. I appreciate that. And, again, we have got to 
prioritize our resources. As you have stated, we have limited 
resources between, putting that prioritization on compliance 
rather than aggressive penalties. And I think that is very 
important. I would miss an opportunity to not mention the 
Working Families Flexibility Act as the discussion of paid time 
off.

                    WORKING FAMILIES FLEXIBILITY ACT

    I have introduced again in this Congress the Working 
Families Flexibility Act, Mr. Chairman, that is an amendment to 
the Fair Labor Standards Act that provides that private 
employers and employees can voluntarily enter into an agreement 
for compensatory time, where that employee can use their paid 
time off. And rather than take the cash payments, they can have 
paid time off in lieu of those cash payments.
    I think this is something that we can work on collectively. 
And I hope that we will be able to have these discussions. This 
provides real flexibility for folks where both parents work 
outside of the home, want to take care of their children, want 
to have that opportunity to coach a soccer team, and also may 
have to be taking care of an aging parent at the same time.
    It is a very simple amendment to the Fair Labor Standards 
Act. And I hope that we together in a bipartisan way can reach 
this goal.
    I am not wearing green, I yield back.
    Mr. Cole. The gentlelady would be given extra time anyway. 
I look forward to the introduction of her legislation. I was 
happy to support it last time. Look forward to doing so again.
    I am going to yield my time to the chairman again since he 
has a very tight schedule because I know he had some questions 
he cared to ask.
    Secretary Perez. Thank you, Mr. Chairman.

            EMPLOYMENT RETIREMENT INCOME SECURITY ACT, ERISA

    Chairman Rogers. Thank you, Mr. Chairman.
    Mr. Secretary, the Department of Labor is proposing a new 
rule to change the definition of fiduciary, which would govern 
personal investment accounts. SEC, of course, oversees the key 
participants in the security world, including securities 
exchanges, securities brokers and dealers, investment advisers, 
and mutual funds. Labor exercises jurisdiction over Federal 
pension laws and regulations through the Employee Retirement 
Income Security Act, ERISA.
    In 2010, DOL proposed the definition of fiduciary rule. It 
was withdrawn after a big backlash from the business community 
and numerous investment groups. In 2015, you are preparing 
another conflicts of interest rule, again attempting to 
regulate the type of advice broker-dealers can give their 
clients. Your Web site says that SEC staff provided significant 
technical assistance in developing this new proposal.
    However, in a recent article, SEC Commissioner Daniel 
Gallagher is quoted as saying, DOL has not formally engaged the 
SEC Commissioners in the process. Past appropriations bills 
from this subcommittee, including the fiscal year 2014 omnibus, 
have contained provisions that have prohibited DOL from using 
funds to promulgate the definition of fiduciary regulation.
    Mr. Secretary, the ERISA was designed to govern pension 
plans and 401(k) investment plans provided by an employer. The 
SEC's mission is to protect investors and regulate the 
financial industry, including broker-dealers. Any regulation in 
this space could have wide-reaching implications for the 
financial industry. And this committee, on a bipartisan basis, 
has prohibited Labor from moving into this space in recent 
years.
    Please explain to us how ERISA gives DOL jurisdiction over 
an individual's relationship with a personal investment 
adviser.
    Secretary Perez. ERISA, has overlapping jurisdiction with 
the SEC. We handle ERISA. The SEC handles another set of 
statutes. We sent a letter yesterday, Mr. Chairman, in response 
to an inquiry from Chairman Kline that gets into basically 
everything that you asked and outlines in great detail the 
significant collaboration we have had, including I think eight 
or nine meetings I have had with Chairwoman Mary Jo White in 
this process. We have a shared interest in making sure that 
people's hard-earned money goes to them. That is why we have 
been working so hard.
    When I was confirmed, the first thing I did was I slowed 
this process down because I wanted to learn from what happened 
before. I wanted to make sure we listened and engaged various 
stakeholders, including in the industry. I have participated 
personally in as many meetings on this proposal as any other 
initiative in my tenure as the Labor Secretary. The Department 
of Labor has a very important equity through the enforcement of 
ERISA in protecting folks, who have their hard-earned money--to 
make sure that when they are getting advice, it is in their 
best interest.
    As I have said a number of times, three of the most 
important decisions people make in their lives are legal, 
medical, and financial. I am a lawyer. I have got four 
siblings; they are all doctors. We all have an obligation to 
look out for and put our client or patient first. So many folks 
who are in this space, including the person who provides 
financial advice to my wife, holds himself up to a fiduciary 
obligation. What they tell us, including people like John 
Bogle, the founder of Vanguard, is that when you take care of 
your customers and put your customers first, it helps your 
customers and it helps your business. So it can be done, and so 
that is what we have been doing throughout this process is 
considerable outreach because the law gives DOL the authority 
to define a fiduciary under the tax laws in the same way as the 
ERISA definition. So that is what we are doing right now.
    We have done a significant amount of outreach. We have sent 
a proposal over to OMB. There will then be another round once a 
proposed rule comes out of formal comment. We look forward to 
hearing that advice. We have heard from a number of people, 
including folks who manage pension funds, employers who say, 
you know, I want my workers to make sure when they retire, they 
get as much money as possible. So I think we can do this. I 
look forward to working with you toward that end. I will make 
sure you get a copy of the letter that we sent to Chairman 
Kline because it outlines all of the interactions between the 
Department of Labor and the SEC.
    [The information follows:]
    
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    
                        DOL AND SEC COORDINATION

    Chairman Rogers. SEC Commissioner Daniel Gallagher, in 
speaking of his work with you, your Department, said, quote, I 
believe this coordination has been nothing more than a, quote, 
check-the-box exercise by the DOL designed to legitimize the 
runaway train that is their fiduciary rulemaking, end of quote. 
Pretty strong.
    Secretary Perez. I couldn't disagree more, sir. My 
interactions have been with the chair. When I deal with an EEOC 
issue, I deal with the chair. When I deal with other 
independent agencies, I start with the chair. Again, we have a 
very lengthy letter that outlines the--I personally 
participated in something like nine calls or meetings with Mary 
Jo White. Our career staffs have been working together 
consistently for over a year on this.
    Chairman Rogers. What steps have you taken to remedy the 
concerns of the SEC Commissioner?
    Secretary Perez. Again, we have a proposed rule that will 
be issued in the near future. That will reflect input that we 
have received from industry. That will reflect input we have 
received from the SEC. That will reflect input we have received 
from consumer advocates. Then, once that propose does rule is 
out, we look forward to the next period of comment.
    Chairman Rogers. Will Gallagher be happy with it?
    Secretary Perez. You will have to ask Mr. Gallagher. I have 
never met Mr. Gallagher. I have dealt with Chairwoman White in 
this effort. We have dealt with the career staff. I have not 
dealt with either, Chairman, Mr. Gallagher or other members. 
The only person that I have dealt with in connection with this 
rule has been the chair, which I think is the appropriate way 
to address these issues.
    Chairman Rogers. Thank you.
    Thank you, Mr. Chairman.
    Mr. Cole. I will go to the gentlelady from Connecticut 
next.

                          REGULATORY FUNCTIONS

    Ms. DeLauro. Thank you very much, Mr. Chairman.
    I just want to ask some questions about some of the 
regulatory functions.
    Mr. Secretary, you talked about Frances Perkins, who was a 
hero of mine. If I could model myself on anyone and the work 
that she did and the accomplishments, it would be Frances 
Perkins.
    But on the silica issue, I think it is important to note 
one of the things that you were saying. In 1937, Secretary of 
Labor Perkins announced findings of a report linking silicosis 
to workplace exposure. In 1938, she held a national silicosis 
conference and initiated a campaign to stop silicosis, stating, 
Our job is one of applying techniques and principles to every 
known silica dust hazard in American history. We know the 
methods of control. Let us put them into practice.
    And with the rule that we are talking about here, the 
proposed rule is expected to save close to 700 lives and 
prevent more than 1,600 cases of silicosis each year. It would 
seem to me that that is a worthwhile endeavor. And I applaud 
you for continuing your efforts.

                             FIDUCIARY RULE

    With that, let me just ask about a couple of other areas. I 
would just site, on the fiduciary rule, I think it is important 
that we see the new rule before we draw any conclusions and 
start a process of, again, of fear mongering there.

                         EQUAL PAY REGULATIONS

    I wanted to mention two areas, regulations on equal pay and 
pay secrecy. Last year, we talked about the OFCCP work in 
identifying and addressing wage discrimination based on gender 
and race. I had also suggested that President Obama issue an 
Executive order to prohibit Federal contractors from 
retaliating against employees who disclose salary information. 
When will the Department issue a notice of proposed rulemaking 
on equal pay regulations? The Department has said they thought 
it would be issued in January. That hasn't happened yet. When 
will we see the final regulation for the Executive order on 
nonretaliation for disclosing salary information? The comment 
period for the nonretaliation Executive order closed in 
December. When do you expect to issue a final rule?
    And I have one more regulatory issue.
    Secretary Perez. We are working on both of those now. We 
are currently reviewing the comments on the equal pay report. 
Our goal is to draft a final rule as soon as possible. We want 
to make sure we get it right. On pay secrecy. I share your 
passion for both of these issues, we are in the process again 
of analyzing those comments as well. I know your continuing 
interest, the interest of others. But our goal is always to 
make sure we get it right first and foremost. That has been 
what has motivated us throughout this process.
    Ms. DeLauro. Do you have a time period, Mr. Secretary?
    Secretary Perez. One thing I learned when I was a 
prosecutor is people would always ask me, ``When are you going 
to finish your investigation?'' When I was a young prosecutor, 
I once answered that question. Then when I was wrong by a 
factor of three, like our general contractor, who does the work 
on the house, I learned that I should be a little more careful 
about giving precise estimates.
    I feel very confident that we are going to reach our goal 
of April 30 on the H-2B or else I wouldn't say that. I am a 
little bit less confident of a precise date here. So I would 
hate to say something and then fall short.
    Ms. DeLauro. That means I have to keep asking you the 
question.

                 FAIR PAY AND SAFE WORKPLACE INITIATIVE

    Secretary Perez. And I welcome that.
    Ms. DeLauro. Fair Pay and Safe Workplaces, this is about 
Federal contractors. We know the majority of our Federal 
contractors play by the rules, and they treat their workers 
well. But I don't think it is appropriate for taxpayer dollars 
to go to a Federal contractor who violates Federal laws, 
discriminates, or puts workers in danger. As far as I can tell, 
the administration's Fair Pay and Safe Workplaces initiative is 
straightforward. Most contractors should simply have to just 
check a box in order to comply. Nonetheless, there seems to be 
a lot of misconceptions about the problem. Can you just help us 
understand the realities of what you are trying to do and to 
stop the fear mongering here? And why do critics think it is 
outrageous for the Department to ensure that Federal contracts 
are reserved for contractors that abide by the law?
    Secretary Perez. Well, I think Federal contracting is a 
privilege. It is not a right. You don't have a right to a 
Federal contract. I also think that when people are engaged in 
chronically bad behavior, they should not be allowed to compete 
for Federal contracts. I also wholeheartedly agree with you 
that the vast majority of contractors play by the rules. So, 
under this new provision, what they will do is there will be a 
question, do you have any issues that fall within this 
category? They check the box no, and they move on. So for the 
vast majority of folks, the requirement will be checking no.
    For those who have labor issues, we have set up and are 
setting up a process where we have labor compliance officers 
that will work with folks because the goal here is to work 
through these issues. The goal is not to, at the end of the 
day, play the gotcha game. The goal is to promote compliance by 
making sure that if you have chronic OSHA violations--like the 
company in Washington State in 2010, they had--it was an oil 
refinery--seven fatalities, like 44 OSHA citations in the 
aftermath. Two years later, they get a Federal contract. There 
should have been a better process leading up to that. And this 
is what this does is make sure that we have a process that 
ensures that our scarce taxpayer dollars are going to companies 
that play by the rules.
    Ms. DeLauro. Thank you very much, Mr. Chairman.
    Mr. Cole. Thank you.
    The gentleman from Tennessee is recognized.
    Mr. Fleischmann. Thank you, Mr. Chairman.
    Secretary Perez. Good morning, sir.
    Mr. Fleischmann. Good morning, Mr. Secretary. Thank you for 
being with us.
    Secretary Perez. Glad to be here.

                          PROPOSED SILICA RULE

    Mr. Fleischmann. Yes, sir. Mr. Secretary, I would like to 
ask you a few questions about the Department of Labor's 
proposed silica rule. I understand that the Occupational Safety 
and Health Administration, OSHA, significantly underestimated 
the cost employers will bear in order to implement this rule. 
In addition, doubts have surfaced that reducing exposure to the 
levels OSHA exposes is technically not feasible in some cases, 
sir. My first question is, do you plan to revisit the cost of 
this rule?
    Secretary Perez. Well, every rulemaking, you do have an 
economic analysis. And we have had a robust hearing process and 
comment process, and we received comments from a wide array of 
stakeholders in the tens of thousands of pages. As part of the 
final rulemaking process, a demonstration of cost/benefit is 
always part of that economic analysis. So that will include 
addressing questions and concerns, including, but not limited 
to, questions and concerns along the nature of what you have 
asked.
    Mr. Fleischmann. Okay, sir. Specifically, the Department 
has stated on several occasions that it will not undertake a 
new small business advocacy review. Given that so much time has 
passed since the first review in 2003, will you consider or 
will you conduct another business advocacy review prior to 
finalizing the rule, sir?
    Secretary Perez. Well, a number of small businesses were 
invited to provide written comments and were invited to 
participate in last year's public hearings. We held public 
hearings over the course of a period of weeks. Many of those 
small businesses that you are addressing had that opportunity 
to weigh in then. We are always concerned about the concern of 
all businesses owners, large, small, and in between. We take 
those concerns very seriously. That is why this rulemaking 
process has proceeded slowly because there is a lot of folks 
who have a lot of questions. And so we want to make sure that 
every voice is heard.

                           GOVERNORS' RESERVE

    Mr. Fleischmann. Thank you, sir. I am going to switch my 
questioning now to the Governors' Reserve issue. Governors of a 
State are authorized by the Workforce Investment Act, the WIA, 
to withhold up to 15 percent of appropriations to that State 
for statewide employment and training activities. This set-
aside was reduced to 5 percent fiscal year 2012, which was 
intended to be a one-time reduction to help reduce the level of 
carryover balances and was not a reflection of the services 
that States were provided to the workforce delivery system. The 
fiscal year 2015 Appropriation Act partially increased this 
set-aside to 10 percent. Based on the evidence and performance 
data available, what in your view is the optimal level for the 
set-aside? And what is the basis for your conclusions, sir?
    Secretary Perez. Well, as someone who did this work at a 
local and State level, I am intimately familiar with what we 
used to call the 15-percent dollars. In Maryland, we did a 
number of important things with them. I have spoken to 
workforce investment boards and States about the importance of 
this. I really appreciate what Congress did last year in 
reaching a 10-percent level. In order to get from 10 to 15 
percent, it was our judgment that what would end up happening 
is you would have to take money from the formula and that would 
have the impact of hurting folks at a local level.
    So, as someone who has worked at a local level, if you go 
up to 15 percent, then the formula dollars for everyone 
decrease. In our judgment, that is not overall in the best 
interest of moving the program. The budget request that we have 
is for increases in that formula funding, which will help 
everybody, including States. I am a big believer in this 
Governors' Reserve. I certainly look forward to working with 
you to identify ways that we can, you know, continue to 
innovate and continue to use either this fund or other formula 
funds or other investments to meet our shared goal of getting 
more folks back to work.
    Mr. Fleischmann. Yes, sir. And I appreciate your answer. 
But can you give me a figure? What is your view? What is that 
optimal number?
    Secretary Perez. I mean the 15 percent was the authorized 
amount. I certainly look forward to working with this committee 
to figure out how we can create a roadmap to 15 percent. I 
think it is important, as we draw that roadmap up, to recognize 
the consequences that sometimes enure from going to 15 percent 
because if it is 15 percent at the expense of other dollars 
that go into the formula, then I think it is very important to 
have sort of a conscious conversation, understanding how one 
decision can impact the ability of the system to serve other 
folks. Certainly the 15 percent authorization is something that 
I think is a good thing. I think the conversation we are having 
is, how do we draw a roadmap so that we can help get there?
    Mr. Fleischmann. Thank you, Mr. Secretary, for answering my 
questions.
    Mr. Chairman, I yield back, sir.
    Mr. Cole. Thank you very much.

                               H-2B VISAS

    I want to cover a couple things quickly. As you noticed, 
there is quite a deal of interest in H-2B visas. I am not going 
to ask you to revisit your testimony, which I think is clear. I 
would ask you, we learned about the legal decision, the stay 
that you have gotten or, excuse me, were requesting through the 
Department of Homeland Security. So given the interest on this 
committee, I would just ask you to keep us abreast as you move 
down the line trying to address it. We have got considerable 
bipartisan interest in resolving this, which I know you are 
trying to do.
    Secretary Perez. I will absolutely do that. We will keep 
you posted on a regular basis.
    Mr. Cole. I appreciate very much on that, Mr. Secretary.

                        AUTHORIZING LEGISLATION

    I also wanted to touch on something the chairman mentioned 
in passing. For your fiscal year 2016 budget, you provided some 
detail about several proposed mandatory programs. Those are 
obviously beyond the jurisdiction of this particular committee. 
But I am curious, have you actually submitted authorizing 
legislation to the committees of jurisdiction for that at this 
point?
    Secretary Perez. I am not sure if we have gotten that 
together yet. We have been working with some folks on some 
aspects of that. But I don't know that it has been translated 
into bill language.
    Mr. Cole. Okay. If you do that, again, we would request to 
be involved because, actually, what happens there obviously 
reflects back on our own budget.
    Secretary Perez. You have been very, very inclusive. I want 
to make sure we are always respectful of your interest and 
role.

                               BCA LEVELS

    Mr. Cole. I appreciate that, Mr. Secretary.
    One other area--and, again, this touches a little bit on 
something that the chairman of the full committee brought up--
you have a very robust increase requested. And the debate over 
the merits of that aside, our challenge here is obviously our 
allocation is likely to be a lot lower than your request. Your 
request is appropriately based on the President's budget. That 
is what you ought to be doing. But, frankly, that budget is not 
likely to become law. The Republican budget that is going to be 
rolled out today is not likely to become law. They are both 
competing plans. And there will probably have to be some 
negotiation down the road. But, in the interim, we are probably 
forced to appropriate to BCA levels and absent a larger deal at 
a level above our own. So, given that, what would be your most 
important priorities if we were stuck in a sort of flat-line 
situation as we are working through the appropriations process?
    Secretary Perez. Well, that is somewhat akin to asking who 
your favorite child is.
    Mr. Cole. That is exactly right.
    Secretary Perez. What I would say, as a father of three, I 
love all my children, and I love them equally. Similarly, we 
talked a lot about effective workforce development that gets 
folks back to work. We have talked a lot about the need to have 
robust enforcement of worker and retiree protection laws. We 
administer benefit programs. The Navy Yard tragedy of a year 
and a half ago, we processed those claims lickety-split to give 
dignity to a family who had to confront the unimaginable. Our 
BLS and other data sources, they enable us to do so much work 
as a Nation, not just in government but in the private sector. 
So these are all important things. That is why, frankly, you 
know, the sequestration caps are unrealistic. We were able to 
serve less people who needed jobs last year as a result of some 
of the caps. That is unfortunate. I know you have recognized 
that in the past, so I appreciate that.
    Mr. Cole. Again, Mr. Secretary, I do recognize that. 
Although I always like to point out, sequestration was passed 
by Congress, signed by the President. It was actually a 
proposal of the President.
    Secretary Perez. Absolutely.
    Mr. Cole. And, you know, to a degree, it has worked in the 
sense that it has lowered the budget deficit. And that is a 
good thing. On the other hand, I would rather address some of 
the mandatory problems. My friend would probably rather address 
some of the revenue problems. But, in any event, there has got 
to be some sort of discussion at some point. And it makes the 
budgeting exercise very difficult. I won't press you to choose 
between your children. Although, I actually got Secretary 
Duncan to choose his favorite child. He likes early childhood 
development a lot. But Secretary Burwell was equally adept at 
not choosing between her children. You guys might straighten 
this line out. I will say this, we are going to have to have 
this discussion at some level in some way going forward. And I 
say that with all due respect because I care a lot, given your 
expertise and your Department's expertise, about what you think 
really is the most important thing. We are not likely to have 
what we would all like to have when we are making some of these 
decisions. So, in the course of our discussions, I hope I am 
able to discern the things that you really do think make the 
most difference, particularly in terms of helping people get to 
a job that I know we all want them to have. And I will give you 
a chance to answer that because I don't want to shut you off 
with a red light since I have chastised everybody else for 
doing that.
    Secretary Perez. I look forward to working with you. Thank 
you.
    Mr. Cole. Okay. Very good.
    I will move to my friend, the distinguished lady from 
Connecticut.

                      STREAMLINING DATA COLLECTION

    Ms. DeLauro. Mr. Chairman, it sounds like Sophie's Choice 
here. So I would just add that to what the Secretary said. I 
would also make this comment, that I think it is also important 
when we take a look at the budget, it is about 
$1,500,000,000,000 that is spent on tax cuts. About 17 percent 
of those tax cuts go to the wealthiest 1 percent. And probably 
it is the 1 percent of the 1 percent who are getting the 
breaks. I think that has to be regarded as spending. And that 
is part of the equation that we don't look at. So it has got to 
be part of the discussion when we sit down to talk about 
dealing with sequestration.
    Mr. Secretary, in yesterday's Washington Post, there was an 
article about Federal labor data could help stem unemployment. 
The President's 2016 budget proposal includes a $5,000,000 
request to study and test approaches to modernize and 
potentially streamline data collection for O*NET. The measure 
seeks to improve up-to-date coverage of occupation skills, 
particularly for high-growth changing industries. Can you just 
talk about that a bit?
    Secretary Perez. We sit on a treasure trove of data. You go 
to Monster.com, you go to all the private-sector companies that 
are job aggregators, and they are building off of the 
foundation of our data. We want to make sure that we are far 
better positioned as a Nation as we talk WIOA and its vision of 
demand-driven jobs, we want to drill down into sectors so that 
we have a better understanding of what the demand needs are and 
we can measure it. So that is why we have this request. I think 
information is power. We sit on a ton of information now. But 
we could be even more powerful if we were to take it to data 
3.0.
    Ms. DeLauro. To move in this direction, thank you very 
much. It is a great article. I am sure you read it.
    Secretary Perez. I agree. It was music to my ears.

                NEW PILOT PROGRAM FOR YOUTH EX-OFFENDERS

    Ms. DeLauro. This is a question that I think my colleague, 
Mrs. Lee, would like to ask, but she had to leave. The budget 
request includes an increase of $13,000,000 for the 
reintegration of ex-offenders, for that program. She is a 
strong supporter of this program, which helps to prepare adult 
and youth ex-offenders to find jobs in their communities. It 
provides comprehensive career assistance, supportive services. 
In the budget request, the portion of the increased funds will 
be used for a new pilot program for youth in coordination with 
the Department of Justice. Can you just speak about that a 
little bit?
    Secretary Perez. Well, having come from the Department of 
Justice to the Department of Labor, you know, as a prosecutor, 
I always thought that if you wanted to be smart on crime, you 
needed to recognize that the best way to avoid recidivism is to 
get people access to the skills they need so that when they get 
out, they have access to a good job. That is what this program 
is about.
    The two agencies that have the most robust investments in 
the reentry space are DOJ and DOL. It has been a pleasure to 
work with our DOJ colleagues. We have been doing a lot of 
braided funding and synergistic grant making. We have a 
proposal on the street right now to replicate a model that 
started in the Montgomery County Jail where we have an American 
Job Center in the county jail. The return on investment on that 
is remarkable. You prepare people while they are there 
incarcerated for jobs that are in demand. The warden will tell 
you that it made jail safer. The business community will tell 
you that we got a good pipeline of folks. These are the smart-
on-crime initiatives that I think are really important. We are 
now seeing the crime rate and the incarceration rate drop last 
year for the first time in 40 years. That is a remarkable 
development.
    And I think these sorts of investments--and I appreciate 
your leadership, Mr. Chairman, because you believe in second 
chances. Your leadership on this, this is an area, as I 
mentioned in my opening remarks, there is a lot of overlap in 
terms of our values and things we can work on together. I think 
this is a really robust example.
    Ms. DeLauro. Thank you.

                        WORKER MISCLASSIFICATION

    I don't know if we will have a final--I wanted to ask about 
the misclassification of workers and your efforts in dealing 
with that through the initiative, where 19 States have been 
awarded funds to help address the issue. If you could provide 
us with an update on the initiative, how the States are faring 
with misclassification, a few examples of how the initiative 
has restored legal protections and benefits to workers.
    Secretary Perez. Well, this initiative basically--by the 
way, the initiative, the 19 States where the MOUs are, it is 
not a blue-red thing. We have an MOU with Utah. We have MOUs 
with Massachusetts because misclassification is everywhere.
    Ms. DeLauro. Everywhere, right.
    Secretary Perez. Misclassification has three victims. It 
has the worker him- or herself, who is not getting protections 
and getting lower wages. It has the employers who play by the 
rules because they compete, and they can't compete against 
someone who is paying someone under the table and isn't paying 
their UI and their workers' comp. Then, the tax collector is 
getting cheated because people aren't paying into workers' comp 
funds. That is why this has not been a partisan issue in my 
experience in Maryland or here. Our MOUs are with a multitude 
of States that we would describe in our clunky colloquialism as 
red and blue. We are doing that because we are able to help 
workers get access to the wages they deserve and create a level 
playing field for employers. We are now actually up to 20 
States, from Iowa to Alabama to Utah to Louisiana. And we are 
going to keep moving on this.
    Ms. DeLauro. Thank you very much, Mr. Secretary.
    Mr. Cole. Thank you.
    I want to go to my friend Mr. Harris, who has gamely tried 
to go from hearing to hearing. Thank you very much for coming 
back.
    Mr. Harris. Thank you very much. Let me just follow up--and 
I won't go up to the red light this time, Mr. Chairman.

                  OSHA STANDARDS AND METHODS TO COMPLY

    The specific question I asked was about OSHA and the 
standards and the methods to comply, that various companies 
that do hydraulic fracturing can comply. It just puzzles me why 
these personal air-filtered helmets are not--and you can get 
back to me, you know, subsequently if you don't know, but why 
aren't personal air-filtered helmets considered an effective 
form to comply with the OSHA silica standard? I don't get it. 
Again, I work in an operating room where these are used all the 
time, these kind of air-filtering helmets. They work. They work 
on bacteria. So they are going to work on silica. Why isn't 
OSHA willing to say that, yes, if you use these, you can be in 
compliance?
    Secretary Perez. I am happy, Congressman, to have the OSHA 
staff meet with your staff to discuss this. Dr. Michaels has 
met with many Members of Congress on these issues.
    Mr. Harris. He didn't answer me, we sent a letter to him, 
Chairman Kingston and I, back in 2013, and he didn't provide a 
satisfactory answer to that letter.
    Secretary Perez. If it wasn't satisfactory, he is happy to 
come up and answer any additional questions you have.

                     REGULATORY AUTHORITY UNDER INA

    Mr. Harris. I hope so. I hope this time it is a more 
satisfying answer. Let me go back to, because H-2B is so 
important in my district. Let me get the construct straight. I 
mean, DOL has twice now been rebuked by the courts, which have 
vacated their rules, the 2012 rule first and now the 2008 rule, 
saying that DOL just doesn't have regulatory authority under 
the INA. So why doesn't DOL just say, Okay, we will go back to 
the pre-2008, where we merely consult and DHS is the primary, 
really the only rule maker? That would solve the problem, 
wouldn't it?
    Secretary Perez. There have been a number of decisions, 
including but not limited to the decisions that you referenced. 
The courts have been all over the map on the issues of the H 
programs that we administer. The April 30 interim final 
regulation that I mentioned earlier will be a joint regulation 
of DHS and the Department of Labor because each agency has 
equities, each agency has expertise. That is why it will be 
joint.
    Mr. Harris. Mr. Secretary, why should we believe that that 
joint rule, that the courts wouldn't treat it the same way and 
say, Look, DOL doesn't have regulatory authority. I mean why 
not just come up----
    Secretary Perez. But the current rule was a DOL rule. The 
IFR will be a DHS-DOL joint rule. The decision from the court 
was that you should do it together. We are doing exactly what 
the court told us to do. So, in the end of April, it will be a 
joint rule. And I am confident that the issue that was 
addressed by the court will be addressed in our rulemaking.

                     H-2B RECRUITMENT REQUIREMENTS

    Mr. Harris. Okay. Let me just ask one final question--it is 
pretty brief--why, when this ruling came out, did the DOL 
instruct the State Workforce Agencies to stop accepting H-2B 
job orders? I don't quite understand because that would just 
have returned it to the--I mean, the court ruling was the 2008 
rule is vacated. To me that returns it to the pre-2008 status 
temporarily because the 2008 rule doesn't exist. And the State 
Workforce Agencies were empowered before 2008 to actually 
publish the H-2B job orders. Why would the Department go out of 
their way to tell State Workforce--specifically to employers, 
do not post H-2B job orders?
    Secretary Perez. When a court tells you you don't have 
rulemaking authority, then you don't go around what a court 
says. The identical question was asked before, and let me tell 
you what I told the Congressman, which was we cannot process 
them for the H-2B purposes, but they can still post the job to 
hire U.S. Workers. So that is part of the H-2B requirement is 
that you have to post the job. So anyone who is going through 
this process as we speak can still post job openings for H-2B 
workers.
    Mr. Harris. Okay. That is not what the DOL communication to 
the State Workforce Agency reads. It says, You can no longer 
accept or process such job orders in the H-2B program for the 
purposes of complying with the H-2B recruitment requirements. 
So there may be a disconnect in what they think the Department 
has said. But I don't want to get to the red light.
    Thank you very much, Mr. Chairman. I learned.
    Mr. Cole. You have made brownie points for the next one 
now.
    Just so you know, Mr. Secretary, I am going to have just 
one question. The gentlelady from Connecticut is going to have 
one. And we will mercifully let you go.

                    IT MODERNIZATION FUNDING REQUEST

    The question that I have, you have a very robust request, 
677 percent increase for funding for IT modernization. I would 
like you to run through the justification for that. I know you 
are dealing with a lot of legacy systems. I know you are trying 
to make the great change. What sort of efficiencies would you 
see? Again, that is a very robust increase in a tight budget.
    Secretary Perez. I don't disagree with you that it is a 
robust increase. Our Deputy Secretary was in New York recently. 
We both go out and we visit our staffs. He was with the OSHA 
staff--he sent me a photograph of their technology that they 
use out in the field. The technology consisted of a flip-top 
phone. I mean I haven't seen one of those in about 20 years. We 
are only as productive as our IT. We had external audits that 
were done to see, you know, how do we fare vis-a-vis the rest 
of the Government? We are not faring well in terms of our IT 
capacity. Information is power. When you are an investigator 
out on the street--I have seen other agencies, and I have 
helped do this in other agencies where you can basically type 
in all of your data. If you have to take a photograph of 
something, you can take a photograph and now it is on your iPad 
or whatever device you have. You don't then have to go back to 
the office, take what you had on an 8\1/2\ by 11 and write it 
in. So you do more cases that way. I want to skip the nineties 
and skip the first decade of the 2000s, and then try and maybe 
jump from the eighties to 2014. And it is really about, when I 
think about what we are doing, this is one of the biggest 
barriers as a Department to our being what we need to be and 
what I think we both would want the Department to be.
    Mr. Cole. I won't ask you if it is your favorite child, but 
I will tell you it is a very expensive child.
    With that, I yield to my friend from Connecticut for the 
final question of the hearing.

                        RECRUITING U.S. WORKERS

    Ms. DeLauro. Thank you. And it is probably more of a 
comment. There has been so much discussion today about the H-2B 
program. And I believe that what we ought to be doing--and I 
would say this to you, Mr. Secretary, and in so many ways 
implore you with this effort is to ensure that Americans have a 
fair shot at taking a job before we begin to bring in workers 
from other countries.
    I talk about this because I am concerned that some 
employers use the program as a way to keep wages artificially 
low. I will give you two or three examples: H-2B construction 
workers earn $10.85 an hour. The national average is $16.84 an 
hour. Landscapers earn $9.16 an hour. The national average 
equals $12.65 an hour. H-2B maids earn $8.14 an hour. And the 
national average is $10.64 an hour. This is a tough economy. It 
is a tough economy. The biggest single issue that we have today 
in the United States is that people are in jobs that just do 
not pay them enough.
    The Department's inspector general says he is concerned 
that employers don't do a good job in recruiting U.S. workers 
to fill open positions. I don't know what the final disposition 
of all this is going to be with regard to H-2B workers, Mr. 
Secretary, but I do, as I said, implore you to please make sure 
we have a program that supports American workers and allows 
them to achieve the kind of economic security that they need 
for themselves and for their families. Thank you.
    Secretary Perez. Thank you.
    Mr. Cole. Thank you.
    And, Mr. Secretary, again, I want to thank you for your 
generous time today.
    Secretary Perez. Thank you.
    Mr. Cole. I appreciate your testimony very much and look 
forward to working with you as we go forward and develop your 
budget.
    Secretary Perez. I do too. I apologize if I went on on a 
couple of my answers.
    Mr. Cole. Oh, no. I appreciate the enthusiasm. It was 
actually more our members setting you up than it was you 
overusing your time.
    With that, the hearing is adjourned.
    
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                                         Wednesday, March 18, 2015.

   OVERSIGHT HEARING--CLOSING THE ACHIEVEMENT GAP IN HIGHER EDUCATION

                               WITNESSES

GAIL MELLOW, PRESIDENT, LA GUARDIA COMMUNITY COLLEGE
AARON THOMPSON, EXECUTIVE VICE PRESIDENT AND CHIEF ACADEMIC OFFICER, 
    KENTUCKY COUNCIL ON POSTSECONDARY EDUCATION
BENJAMIN L. CASTLEMAN, ASSISTANT PROFESSOR OF EDUCATION AND PUBLIC 
    POLICY, THE UNIVERSITY OF VIRGINIA
CAROL L. FISCHER, PH.D., POST-DOCTORAL FELLOW, THE UNIVERSITY OF IOWA
BRIAN K. FITZGERALD, ED.D., CHIEF EXECUTIVE OFFICER, THE BUSINESS-
    HIGHER EDUCATION FORUM
    Mr. Cole. Good morning. And just for informational 
purposes, President Mellow is stuck in the Metro or someplace 
in traffic, something that we are all familiar with around 
here. So as soon as she gets in, she will be joining the panel. 
And we are trying to get her here as quickly and as easily as 
possible.
    I am going to have my prepared statement here for a second, 
but I just want to open, as I visited with you privately 
beforehand, and I want to tell you how pleased I am that we 
have each and every one of you here. I was so thrilled reading 
your testimony last night. I appreciate collectively your 
efforts to make sure that folks that often don't have 
opportunities or that have slipped through cracks find ways to 
move forward and this focus on helping particularly first-
generation college kids succeed. And not always kids, as Dr. 
Fischer will tell us a little bit later. But I am just 
extraordinarily pleased with your work.
    Again, this is a committee where we sometimes have some 
spirited differences. This is actually one of the topics that 
tends to bring us together across partisan lines. So, again, I 
am really thrilled you are here.
    And my pleasure to welcome our witnesses today to the 
Subcommittee on Labor, Health and Human Services, and Education 
to discuss closing the achievement gap in higher education. 
Looking forward to hearing your testimonies.
    Our country's system of higher education is unparalleled in 
the world. Our institutions of higher education have produced 
advancements in science, technology, and the humanities, and 
have been critical in making the United States economically 
competitive. Our higher education system has also made a 
difference in the lives of millions of Americans by helping 
individuals from disadvantaged backgrounds to improve their 
economic prospects and enter the middle class. And they have 
educated tens of thousands from around the globe, while setting 
a global standard in access and excellence that is the envy and 
inspiration of much of the world.
    Despite its many successes, our higher education system 
faces challenges. Minorities and children from low-income 
families are less likely to attend college compared to their 
wealthier counterparts. Additionally, entering college does not 
guarantee success. Students from these same groups are also 
less likely to persist in higher education and eventually 
obtain a degree.
    While the cost of higher education is certainly a factor, 
it is not the only factor. Often these students lack a network 
of family and friends who have attended college and are 
familiar with the in and outs of applying for aid, choosing 
classes, and preparing for a career after graduation.
    There is a role for the Federal Government to play in 
helping disadvantaged students to be successful in higher 
education. A more educated populous strengthens our workforce 
and our international competitiveness. Individuals who complete 
their course of study and obtain a degree are more likely to be 
employed and earn more than their counterparts who were not 
able to do so.
    The Department of Education's loan and grant programs make 
higher education a possibility for millions of Americans, and 
programs such as TRIO and GEAR UP help students to make use of 
these financial resources. Through these programs, the Federal 
Government partners with States, school districts, institutions 
of higher education, nonprofits, private industry, and tribes 
to help develop students to prepare for, enroll in, and 
complete a higher education. This preparation is essential for 
helping these students make use of the financial aid and 
educational opportunities that are available to them.
    Today we look forward to hearing from our witnesses about 
ways in which the efforts I have mentioned can improve college 
access and completion among first-generation college students.
    Today I am pleased to welcome--and she is not yet here but 
will be, so I am going to go ahead and mention her--Dr. Gail 
Mellow, the president of La Guardia Community College in Long 
Island City, New York, who will testify about successful 
interventions that have been piloted at La Guardia and 
elsewhere to help students succeed in completing their chosen 
degree programs.
    Dr. Brian Fitzgerald, CEO of the Business-Higher Education 
Forum, who will testify about private sector partnerships to 
increase educational attainment for underrepresented 
populations, particularly in areas aligned with workforce 
needs.
    Dr. Ben Castleman, assistant professor of education and 
public policy at the Curry School of Education at the 
University of Virginia, who will testify about his research on 
the impact of relatively low-cost interventions providing 
information on financial aid on keeping disadvantaged students 
in school.
    Dr. Aaron Thompson, executive vice president and chief 
academic officer of the Kentucky Council on Postsecondary 
Education and professor in the Department of Educational 
Leadership and Policy Studies at Eastern Kentucky University, 
who will testify about efforts in the State of Kentucky to 
develop partnerships to improve higher education.
    And Dr. Carol Fischer, postdoctoral fellow at Dows 
Institute for Dental Research at the University of Iowa and 
adjunct professor in biology at Kirkwood Community College in 
Cedar Rapids, Iowa, who will testify about her experience with 
the McNair Program, a part of TRIO, which helped her overcome 
obstacles as a first-generation college student and obtain a 
Ph.D. I must add she also is a former resident of the district 
that I am privileged to represent.
    So it is very wonderful to have you here. And that is a 
program at East Central I am very, very familiar with, and it 
has just done a great job for literally thousands of students 
over many decades now.
    So I look forward to hearing all of your testimony. I would 
like to yield now to my ranking member for the day, at least 
for the outset of this hearing, the gentleman from 
Pennsylvania, Mr. Fattah, for any opening remarks he cares to 
make.
    Mr. Fattah. Thank you, Mr. Chairman.
    I think that this is a critically important hearing. And, 
obviously, as our country economically competes with billion-
plus populated countries like China and India, the question 
about how we make sure more and more of our young people live 
up to their potential and have the opportunities to be 
productive, both entrepreneurs and part of our workforce in the 
country, is critically important.
    For far too long these discussions have centered around the 
challenges that these young people and their families face. But 
I think more and more now we see that the country faces a 
significant challenge because, as the President said, we have 
fallen so far in the list of nations with adults with a college 
degree. And we see emerging economic powers like China, which 
is going to graduate 280 million people. We sit here in a 
country with just a little over 300 million people. And if we 
are going to remain the leading nation in the world, every one 
of these young people are going to have to have the opportunity 
to achieve.
    This discussion of an achievement gap is somewhat 
mislabeled because a lot of it is an opportunity gap. These 
young people don't get the opportunity in the K-12 circumstance 
to prepare themselves to adequately matriculate at a higher 
education level.
    So I am concerned about the achievement gap from the 
terminal degree down. I think we have challenges at every 
particular sector in our country in which we need to be 
producing more and more college-educated adults. In our federal 
workforce, for national security purposes, we do not now have 
the replacement persons that we need to go into critical 
infrastructures, like maintaining our nuclear weapon stockpile. 
And so we have a lot of challenges.
    And so at the base of this, obviously, I have been very 
interested over the years, from GEAR UP, TRIO, Upward Bound, 
the Opportunity Tax Credit, I mean, we can go through the 
laundry list. But the country will have to come to grips with 
this. And I am so pleased that the chairman is hosting this 
hearing.
    I spent some time a few years ago, I came out to Oklahoma 
City, I went over to Oklahoma University. At that time, it just 
opened up a new engineering school, and they had some GEAR UP 
kids there. And you were looking down over this overhang 
balcony to see them doing the work, and you could see future 
Dean Kamens right there. And we need engineers to solve 
problems, and in order to produce them we need people like 
those presented here.
    So, Chairman, I look forward to hearing the testimony.
    Mr. Cole. Thank you very much, my friend.
    And I had not looked out in the audience but, look, I see 
some proud East Central and Oklahoma. So get up. These are 
people from my district. So I am going to exercise the 
chairman's prerogative and ask you just to stand up and let us 
recognize you and express our appreciation for all you do. 
Pretty proud of your alum that are here. So thank you guys very 
much and appreciate you being at the hearing.
    With that, we will go to the testimony. Obviously, as I 
mentioned, when President Mellow gets here we will sort of 
insert her in the lineup. But if we can, Dr. Fitzgerald, we 
will start with you.
    Mr. Fitzgerald. Good morning, Mr. Chairman, members of the 
subcommittee. As a first-generation college grad myself, I 
thank you for inviting me to speak with you this morning about 
the need to close the achievement gap at all levels in higher 
education and how the Business-Higher Education or BHEF 
projects are addressing this challenge. Now in its 38th year, 
BHEF is the Nation's oldest membership organization of Fortune 
500 CEOs, college and university presidents, and other leaders 
dedicated to advancing innovative higher education and 
workforce solutions and improving U.S. Competitiveness and 
national security.
    Far too few students who enroll in postsecondary education 
persist to complete an industry-valued credential within a 
reasonable period of matriculation. The causes are well 
documented, but the result is unmistakable. Far too many first-
generation, low-income, and underrepresented students leave 
postsecondary education with neither the credentials nor the 
skills to succeed in an increasingly competitive global 
economy.

                       BUSINESS-HIGHER EDUCATION

    BHEF's signature initiative is designed to address this 
gap. Through the collaboration of its business and academic 
members, BHEF has launched the National Higher Ed and Workforce 
Initiative, a 6-year effort that includes regional projects 
focused on business-higher education partnerships to improve 
degree completion. It also includes a national effort to 
disseminate learning from the projects and scale effective 
practices. These partnerships are scaled with other businesses 
partners, including the Aerospace Industries Association and 
the Business Roundtable.
    The regional projects demonstrate how to meet emerging 
workforce needs, increase undergraduate interest and 
persistence in key disciplines, and help students graduate from 
community colleges and universities workforce ready.
    BHEF has a history of developing groundbreaking simulation 
tools to demonstrate the impact of scaling evidence-based 
practices on college completion. BHEF's original P-16 STEM 
Education Model provided insights into how degree completion 
represents a key leverage point in a national workforce and 
competitiveness strategy.
    BHEF and the U.S. Navy's Office of Naval Research 
collaborated to develop the U.S. STEM Undergraduate Education 
Model to show how the Navy's investment in cutting-edge student 
retention strategies can have the strongest impact on its 
future workforce needs. Although the modeling focused on 
students enrolled in STEM majors, it provides a window on the 
broader completion challenge.
    The modeling demonstrates that strategies like providing 
summer bridge programs before matriculation and offering early 
research internships boost persistence in degree completion. 
However, the modeling showed that multidimensional programs, 
those that combine strategies and continue over time, have a 
far greater impact on degree completion. Examples include the 
Meyerhoff Scholars Program, the Louis Stokes Alliances for 
Minority Participation, and the Freshman Research Initiative.
    Many first-generation students begin their postsecondary 
education at community colleges. However, less than 10 percent 
of all students who start community colleges in STEM majors 
earn a degree in STEM within 6 years. NSF has provided BHEF 
with a 5-year grant to launch the Undergraduate STEM 
Interventions with Industry Consortium, a group of BHEF member-
led sites that will engage business and apply combinations of 
evidence-based interventions designed to increase student 
persistence and completion.
    Business engagement with first-generation and low-income 
students before they transfer to 4-year institutions is 
essential. When business plays an active role, it helps ensure 
that students will complete their postsecondary education and 
are provided with opportunities to pursue high-skill, high-wage 
jobs.

                              FEDERAL AID

    The effectiveness of BHEF's initiatives, however, is 
dependent on a healthy higher education system and adequate 
financial aid for its students. BHEF believes that maintaining 
the health of the Pell Grant program and the purchasing power 
of the Pell Grant maximum award, as well as other Title IV 
programs, are critical components of a national completion 
strategy. Federal student aid should remain a priority to 
ensure that all Americans, regardless of their economic status, 
have the opportunity to attend college, improve their knowledge 
and skills to excel in a 21st century economy.
    BHEF recommends funding the Pell Grant program at least at 
the 2015 level and increasing the Pell maximum award. Congress 
also should support the Federal SEOG, Work Study, TRIO, and 
GEAR Up programs to serve more disadvantaged and low-income 
students. Each of these programs plays an important role in 
preparing first-generation, low-income, and underrepresented 
students for college, encouraging persistence and ultimately 
degree completion.
    Thank you for the opportunity to testify.
    Mr. Cole. Appreciate that very much, Dr. Fitzgerald.
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    Mr. Cole. President, welcome. We introduced you and 
explained that you have, like all of us, encountered traffic 
problems in Washington, D.C. So if you are ready, we will move 
to your testimony if that is okay.
    Ms. Mellow. I am. Thank you so much, Chairman Cole. And I 
did have every form of possible delay, airplane delay, someone 
sick on the Metro. It was a wonderful morning. So I am just so 
delighted to be here. And I am so honored to give you testimony 
today. And I am sorry for not having heard my colleagues.
    I am going to speak as a community college president. So 
there certainly are major national issues, but I wanted you to 
hear it from the street level, if you will, from what my life 
is like.

                               LAGUARDIA

    So at LaGuardia we have about 60,000 students. About 20,000 
of those, are going for a degree. About 40,000 of those are 
getting workforce development training with us. But like most 
community college students, beer blast is not a problem that I 
have at LaGuardia.
    These students are majority female. Over half are over 25. 
They all commute. About 60 percent of them work. Of my females, 
about a quarter of them are mothers. Sixty-eight percent of 
these students, and this is true nationally, are working over 
20 hours a week. And when you look at who community college 
students are, I think you see these are the individuals who 
want to make it in America. They believe in the American dream. 
And they are doing everything that they can to get there.
    When we look at the kinds of things that we want to do to 
help them, I think back, so I am revealing my age, I graduated 
from high school in 1971. When I graduated, 28 percent of the 
jobs needed something beyond a high school diploma. Now it is 
60 percent.
    And so at community colleges we have to be relentlessly 
pragmatic in two ways. One is that there are really necessary 
technical and near-term skills that our students need because 
they are poor and they need to work. And so we want to make an 
investment in skills that will really allow them to immediately 
enter the workforce. And that is why our relationship with 
business is so important, and I will speak to that in a minute.
    But we also want to make sure that we give students what I 
will call the general competencies, the longer-term skills, 
because those are like patient capital. Those will really pay 
not immediate rewards, but long-term rewards. And I think 
together what we all want is an economy and a society that is 
filled with people who are living the American dream. So I want 
to speak just a little bit about four ways I have found as a 
college president that really make a difference in the lives of 
students.
    Before I do that, and because I am in front of a 
congressional panel, I couldn't help but do one line of 
reference to funding. And I will just point out that for 
community colleges in our country, we serve now over half of 
all undergraduates and we get about two-thirds of all the 
public funding. So that relationship between what we get and 
what others get for the hardest-to-serve students is a big gap.
    But the four areas that I wanted to speak to you about that 
are sort of on the ground, if you will, one is investing in 
helping faculty be better teachers. We do this all the time in 
K-12. No one pays any attention once that student walks across 
the graduation stage when they get out of high school.

                          INVESTING IN FACULTY

    And so what we have found at LaGuardia is investing in 
helping these faculty teach better is essential. They are 
facing students unlike any we have ever seen before. And what 
we have found is that while most of the technology is focused 
on teaching students, we have to also use that technology to 
teach the teachers. They need better skills. And we have got to 
do that, because if we could get those faculty to help just two 
more students pass their class in every class, we would raise 
graduation rates by 7 percent without any additional dollars. 
And so we have to be smart about technology. LaGuardia is now 
working with community colleges in Arizona and in Florida to 
really use technology to help faculty get better.
    We have also found the same to be true when we look at 
getting students from a high school equivalency, adults who 
didn't make it out of high school, up to and through college, 
because the high school equivalency isn't enough. We did a 
random control trial study in our Bridges to Career and College 
Program and we found when we had full-time faculty, well 
trained, we could make a huge difference, double the 
graduation, triple the number of students who went to college.

                        CONTEXTUALIZE EDUCATION

    But we also had something very important, and that is the 
segue to my second issue, which is that we contextualize that 
education for these adults who have not made it out of high 
school. It is wonderful to read ``Moby Dick.'' I love that. But 
if you are going to be a healthcare worker it is also pretty 
important for you to read some medical records, to understand 
the kind of language that will be used within your occupation.
    And that is where the connection with business is so 
important. We need to know realistically what is needed in the 
workplace. And we have found, for example, in working with 
Weill Cornell, which is a major hospital conglomerate, if you 
will, in New York City, that they were hiring bachelor's degree 
students for their front office staff. They were bright, they 
were wonderful, and they stayed about 6 months, because they 
wanted to do other things.
    When they worked with us and we customized a 17-week 
program to train students who were in their first year of 
college and who had not yet entered college to learn the skills 
that were really necessary, two things happened. One is that 
those individuals stayed longer. And the second is that they 
are now eligible for Weill Cornell's tuition reimbursement. So 
we are really taking people on a ladder step by step.
    But business had to put some skin in the game. It took them 
time to really identify what were the skills that were needed. 
So that relationship with business is essential.

                            APPLIED LEARNING

    The third, leading me to my third point, which is that 
applied learning is essential. Many of my students have never 
met one of us, never met a person who went to work in a suit. 
They never met a professional, much less worked in a 
professional area. So internships and applied learning is so 
important. But to do that is hard. It is hard for the 
businesses. It actually costs time to have volunteer help. And 
it gets harder. Our students are so poor at the community 
colleges that they can't give up their second or third part-
time job in order to do a free internship.
    So I think as a country we need to really think of a 
tripartite relationship where education and business and 
government come together and give students support for working 
in companies where they then can understand what it is like, 
what the job is really like. And the companies, frankly, get to 
see these students, who, they are not from Princeton, they are 
not from Yale, they are not from Harvard, but, boy, they are 
going to make a difference in the American economy.

                           INTENSIVE SUPPORT

    And the last thing that I would say is that we have found 
that intensive support for these students really makes a 
difference. At the City University of New York where LaGuardia 
is one of seven community colleges we have a program called 
ASAP, which is an intensive program that through intensive--it 
is actually intrusive advisement, you don't get away without 
talking to your advisor every other week--with full-time 
status, with support for tuition, whatever tuition gap there 
is, for things as simple as a Metro card, and for really 
focusing on what you should be doing, going to school all the 
time, we have found that we are able to double the number of 
students who graduate in half the amount of time.
    It is a wonderful program. The challenge is it is an 
expensive program. It has to be an investment. So we find in 
ASAP we need an additional about $4,000 per student per year. 
It is not cheap. But the end, to get that student through in 3 
years means they begin a lifetime of earnings.
    And so, Chairman and the rest of the committee members, the 
way to think about community colleges, I think, is to really 
understand that this is a different group of individuals who 
really want to make a difference. They don't need a lot. They 
need a little bit of a helping hand. And then the results are 
pretty extraordinary.
    Thank you so much for asking me here for my testimony.
    Mr. Cole. Thank you very much.
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    Mr. Cole. And now bear with me here. I didn't say this, we 
have a 5-minute rule. When the light goes red, it is up. But we 
are going to be very generous. I don't want you to be 
intimidated by that. I just try to keep our testimony moving 
along. Your full statements will all be entered into the 
record. But say what you want to say because this committee is 
extraordinarily interested in it. And particularly given how 
far and hard you had a trip to get here, we appreciate you 
arriving.
    So if we can, I will move next to Professor Castleman.
    Mr. Castleman. Thank you very much, Mr. Chairman and 
members of the subcommittee. I am honored to be here with you 
today to testify about low-cost, scalable strategies to 
increase college persistence and success, particularly among 
economically disadvantaged students.
    We have made considerable progress over the last decade 
increasing the share of the populous that pursues postsecondary 
education. At the same time that we have witnessed improvements 
in college going, however, gaps in college completion between 
low- and high-income families have only widened over time.
    Recent innovations highlight the potential for low-cost, 
scalable strategies to reduce these inequalities. These 
innovations stem from the growing recognition that targeted 
information and advising about college and financial aid can 
play an essential role in helping students and families 
navigate critical junctures on the road to and through college.

                           SUSTAINED ADVISING

    Policymakers and educators have long recognized that a lack 
of access to advising can prevent talented students from going 
to college, and a wide variety of college access programs have 
emerged over the years to address this gap. Until recently, 
however, what we largely failed to recognize is how important 
sustained advising is for students even after they successfully 
navigate the college and financial aid application process. 
During the summer after high school, for instance, high school 
graduates who have been accepted to college and plan to enroll 
still have to complete a complex array of financial and 
procedural tasks in order to successfully matriculate, yet they 
typically lack access to professional assistance during these 
months.
    In a phenomenon that we have called summer melt, my 
colleagues and I find that 20 to 30 percent of college-
intending high school graduates from urban districts fail to 
enroll anywhere in the year after high school as a result of 
challenges they encounter completing these tasks.
    The good news is that we have developed a variety of 
innovative and inexpensive solutions to help students navigate 
these complex processes and continue on the path through 
college. Much of my own work has leveraged text messaging as a 
strategy to provide students with personalized college 
information and to make it easy for them to connect to 
professional advising when they need help. We can use texting 
to deliver consolidated bursts of information about tasks that 
students need to complete with the confidence that at least for 
a moment in time that content will reach students and grab 
their attention.

                             TEXT MESSAGING

    My colleagues and I have run a series of text messaging 
campaigns to help reduce summer melt. These texting campaigns 
cost less than $10 per student, which includes hiring 
counselors to work over the summer, but can increase the share 
of college-intending high school graduates who make it to 
campus by over 10 percent, with the biggest impacts among the 
lowest-income students.
    We have also applied these text-messaging strategies in a 
pilot study to encourage college freshman to successfully renew 
their financial aid. Community college freshman who received 
these messages were 25 percent more likely to persist through 
sophomore year than students who didn't receive the texts.
    I think we are just at the cusp of seeing how technology 
can be creatively leveraged to help students more effectively 
navigate what has historically been very complex and 
challenging decisions. For instance, there is broad recognition 
of the need to provide students with better loan counseling so 
they can make informed borrowing decisions. Work is now 
underway at the Community College of Baltimore County to use 
text messaging as a channel for connecting students to one-on-
one loan counseling from a financial aid professional.

                           OTHER APPLICATIONS

    Texting is not the only form of interactive technology that 
we can leverage to connect students to high-quality advising. 
With support from Bloomberg Philanthropies, several prominent 
college access organization are reaching out to tens of 
thousands of high-achieving high school seniors to offer them 
sustained virtual college advising. By leveraging interactive 
technologies, like screen sharing and video chat, these 
advisers can from thousands of miles away provide the kind of 
personalized advising to which these students wouldn't 
otherwise have access.
    What sets text messaging and other interactive technologies 
apart are their low cost and scalability. Any organization with 
access to students can collect cell phone numbers and consent 
to message them. I am proud to be collaborating with the 
Institute for Education Sciences and Abt Associates to 
investigate how digital messaging can be leveraged to help GEAR 
UP students make a successful transition from high school into 
the first year of college.
    Federal student aid is similarly well positioned to use 
personalized digital messaging to help students and their 
families navigate various stages of the financial aid process. 
The FAFSA and the loan entrance counseling process both provide 
ideal access points to collect cell phone numbers and other 
forms of contact from millions of students who could benefit 
from simplified information and access to help with these 
complex decisions.
    In closing, it is worth emphasizing that the success of 
these strategies depends on being able to direct students to 
existing resources, like the federal financial aid and college 
advising programs. With these resources in place, and as long 
as students continue to encounter complexities on the road to 
and through college, creative leveraging of technology offers a 
low-cost and scalable strategy to improve college persistence 
and success among disadvantaged students.
    Thank you again very much for the opportunity to testify 
before the subcommittee today.
    Mr. Cole. Thank you.
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    Mr. Cole. Professor Thompson, if we can, we will move to 
you for your statement.
    Mr. Thompson. Chair Cole, Congressman Fattah, and 
distinguished committee members, thank you for the invitation 
and good morning. It is my pleasure being here today 
representing many Kentucky students, both in K-12 and higher 
education. But I am also here representing what I believe to be 
one of the more powerful programs that will address and is 
addressing what my distinguished colleagues have already 
mentioned, that is closing the gap.
    What do we know about closing the gap? We know, especially 
for low-income students, they are five times more likely not to 
enroll in college. We know that if they do enroll in college 
they graduate at about half the rate of those that are not low 
income. And many of these exact sort of demographics can apply 
to students of color.
    Personally and professionally, I have to tell you, I have 
something to bring to the table on this issue. And, President 
Mellow, I appreciate you offering that personal touch. Because 
I am a first-generation high school student, as well as college 
student. I am from central Appalachia. My father was an 
illiterate coal miner. My mother had an eighth-grade education. 
And I will tell you that the value of education was always 
talked about in my home. I have to tell you that when they 
talked about it, I probably interpreted it a little bit 
different than what they really meant it. But that is okay. 
That is about building capacity in a person.
    My father talked about, boy, you get an education, you get 
a chance to not be in the coal mines. My mother said you get an 
education, you have a chance of actually getting money. Both of 
those were very powerful items. So in the last two-plus decades 
in my professional career I have been studying exactly what it 
takes to reach success for those that are most disenfranchised.
    To make a long story short, there are four big items, four 
big pillars, four big building blocks that it takes in order to 
make it happen. And even though this doesn't work this way, I 
would want you to imagine these four building blocks as being 
equal in power.

                                 FAMILY

    The one is the family. We know that the more input a family 
member has, especially with parents, the greater chance that 
that child will actually succeed, right? And that is previous 
education also.

                               COMMUNITY

    We also know that community matters. And the community, you 
guys mentioned this business partnership. In Kentucky, we are 
really into the partnerships with K-12 and higher ed. We know 
working together we can do that.

                                 PEERS

    We also know that peers, by the time they get to be 11 or 
12, may be the most powerful influence on that child. I will 
tell you, my mother always said, boy, you hang out with the no-
goods, you are going to be no good. And her point is that if 
you build a powerful peer relationship, it can be good.

                              INSTITUTION

    The third is the institution itself. And this is where your 
distinguished committee, with very bipartisan efforts, have put 
forth the kind of programs that work. We know that that 
institution may be the place that many of these folks come to 
that they have to actually replicate the first and the second 
building blocks. And we know that is important. And you may 
have been reading, the U.S. DOE came out and said that some of 
these efforts are working, we are closing some of these gaps. 
But, Congressman Fattah, I agree with you, it is about 
opportunity.

                          INDIVIDUAL CAPACITY

    And the fourth one is the student him or herself or the 
person him or herself. We have to be able to build the capacity 
of that person. There are two things that we know that we need 
to build. And I will tell you, GEAR UP, what I am going to talk 
about in a second, does that. We know we have to be able to 
teach them how to self-actualize and recognize when they don't 
have what it takes to be successful. And, number two, about 
going about finding it. You have heard this before, if you give 
them a fish, they will eat one time. If you teach them how to 
fish, they will eat multiple times.

                                GEAR UP

    So this is what we are talking about. GEAR UP is a 
competitive 6- or 7-year grant program that funds either States 
or community partnerships to collaborate and improve the 
academic, social, and financial readiness of low-income 
students and increase the number who graduate from high school 
and enroll in postsecondary education.
    What is unique about GEAR UP, we start early. We know the 
earlier you start in elementary or middle school and follow 
those students through in a cohort fashion, the more input that 
you have across those four building blocks. GEAR UP does that 
starting in the seventh grade. It provides services to its 
students and families.
    So we try to build the capacity of those parents and family 
members to help these students get through. We do mentoring, 
intrusive advising. We get them on colleges. Because much of 
this we are talking about is the college-going culture. Many of 
the kids still--I am from Appalachia, I have to tell you--we 
still have to get them to believe that college and graduating 
from high school being college ready or career ready gives them 
a key towards success. We build the professional, the students, 
the teachers, and the leadership of that school to be very much 
a part of this creation of the college-going culture.
    Why is it unique? As I said, it starts early, from seventh 
grade all the way through the first year of college. It serves 
all students and all grades. We believe that building together, 
raising all tides, gets us to where we need to go. It creates 
partnerships with businesses and community members, especially 
the partnership grants build those unique partnerships that 
direct itself toward the community issues.
    We have a State grant. That is building a strategic agenda 
throughout the State where GEAR UP is a key element, a key 
portion of our overall State agenda, which my office actually 
sets.
    GEAR UP in Kentucky, I want to tell you really quick, when 
we look at comparing the schools that were not in GEAR UP, 
before they got in GEAR UP, we see those schools actually 
increasing their college-going rate by 22 percent. We also see 
that they actually have great success in the first year of 
college. We are now in the process of tracking those students 
as they go through college and see how well they do.
    Berea has several GEAR UP grants, and one of the things 
that they shared with us that I want to share with you is that 
students are reading above grade level, they are doing math at 
17 percent more than their other cohorts, and they are actually 
demonstrating that students who are coming from the most 
disenfranchised area can have a huge input on the opportunity 
that you mentioned earlier.
    So what do we need? We are asking you to continue but 
expand the efforts that we know work. GEAR UP is one of the 
most cost-effective programs that you have, by the way. It 
serves at $547 the kind of impact that I was just mentioning. 
That is per student per year.
    But the need is greater. Less than one in five applicants 
for new GEAR UP projects received the funding in 2014. We could 
get a lot more if we could get more funding obviously. So we 
are asking that you think about it along these terms. We have 
$301,600,000 right now of appropriations that support over half 
a million low-income students. We know that even just a modest 
20,000,000 more dollars would serve at least 35,000 more 
students. And then you can start calculating above that.
    Mr. Chair, I apologize for going over, but I will tell you 
that GEAR UP works.
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    Mr. Cole. Well, you don't need to apologize. First of all, 
as I am sure you know, you have the congressional father of 
GEAR UP up here whose grin was getting progressively bigger.
    Mr. Fattah. Definitely is music to my ears, Chairman.
    Mr. Cole. And the only other thing I can say is your mom 
clearly knew my mom.
    Mr. Thompson. Moms believe in behavioral modification.
    Mr. Cole. It was very similar. We seem to have gotten the 
same parenting advice growing up.
    If we can, next I want to move to Dr. Fischer. And just a 
delight to have you here.

                                  TRIO

    Ms. Fischer. Thank you, Mr. Chairman and members of the 
subcommittee. I am honored to have the opportunity to testify 
today about the impact of the TRIO program on my life. I 
particularly want to encourage the subcommittee to invest more 
in the TRIO programs in the fiscal year 2016 so that more 
students can be served. While TRIO served nearly 880,000 
students in 2005, only about 785,000 students are served today. 
And we very much hope that the House can move towards restoring 
necessary funding for additional students.
    So I grew up in a family that didn't value education at 
all. My home was a very severely abusive one. I missed weeks of 
school at a time because I couldn't go to school with cuts or 
bruises or a busted-up face. And when I was in the sixth grade 
my mom removed my siblings and I from public school under the 
guise of home schooling. And as a sixth-grader I became a 
teacher to my six younger siblings and two younger cousins who 
lived with us. I taught them everything I knew, how to read, 
write, and do math, at least as much as a sixth-grader knows, 
but there was no one to teach me.
    A few years later, and an abusive marriage later, I was 
walking through a county fair in Oklahoma when an East Central 
University recruiter stopped me and asked me if I wanted to go 
to college. I never even considered going to college because I 
literally knew nothing about education. I was a 33-year-old 
single mother of two boys and I lacked a lot in the education 
department. And then there was the issue of money. I honestly 
didn't know that there was money to help people in my 
situation. But this wonderful gentleman convinced me that I 
could and should go to college.
    So to say that attending college was a challenge is a 
pretty big understatement. I hadn't been in a classroom since 
the sixth grade, and I had a lot of catching up to do. Also, I 
couldn't shake the feeling that I was an imposter. So I was 
struggling to gather enough courage and confidence to keep 
going.
    And then I discovered science, something I hadn't really 
experienced because of my lack of formal education, and I knew 
I had found something that I could be passionate about. The 
class was general zoology, and that professor kept me on the 
edge of my seat. I literally wanted to go to class every day. 
By the end of that semester, I had changed my major to biology, 
and several professors in the Biology Department had started to 
talk to me about a graduate degree and how the TRIO McNair 
Postbaccalaureate Achievement program could help me navigate 
that process. I had never heard of a Ph.D., and I certainly 
didn't know how to obtain one, but I loved science and if it 
would help me learn more about science and even be able to 
teach science, I was interested.
    So the McNair office became my home base for the remainder 
of my time at East Central University. TRIO programs enable 
low-income, first-generation students to address the 
nonfinancial obstacles that they encounter to prepare for, 
apply for, enroll in, and complete college.
    The lack of family support that I described is certainly 
not universal among low-income, first-generation students, but 
the presence of major nonfinancial obstacles, together with 
real financial obstacles, are almost always there. For example, 
I almost always worked two or three jobs while I was caring for 
two young children and full-time college, and the sense of 
being different, maybe just not being ready, is so often 
present for low-income, first-generation students regardless of 
their aspirations and motivations.

                                 MCNAIR

    Ronald McNair, himself, encouraged students to dare to 
dream, because big things can happen if you dream big and work 
hard. But sometimes a person doesn't even know how to dream. I 
didn't know how to dream, because I didn't know what to dream 
about. I didn't know what was available.
    But the McNair program helped with that. They were so much 
more than program staff. They became my family and my biggest 
cheerleaders, and they literally changed my life. They opened 
my eyes to opportunities that I didn't know were available. And 
the open-door policies of McNair mentors allowed me to keep 
asking questions until I got answers. And by then I was really 
hungry for answers and for knowledge.
    One of the biggest impacts of the program was that students 
in the program were not treated differently because of their 
less than ideal backgrounds. In fact, the opposite was true. 
For the first time in my life, I started to feel like an equal 
citizen, capable of accomplishing anything I set my mind to. 
They also fostered this community feeling among the students so 
that we became a family. And we supported each other not just 
in classwork, but in personal crises.
    I persevered in my studies, and I ultimately did complete 
my doctorate at the University of Iowa. It was in oral 
microbiology. And I am now engaged in a postdoctoral research 
program, and I am committed to a life of teaching and research. 
And I discovered that passion through research and teaching 
opportunities in the McNair program.
    One of the major reasons to invest in TRIO is the profound 
change it is able to make in an individual life, like mine. 
Another is its reach. TRIO touched me through a small college 
in Oklahoma. But with 2,800 programs in every U.S. State and 
several territories, it is an ideal vehicle for introducing 
effective approaches to student success, but more funds are 
necessary to expand and intensify existing services.
    And I thank you for listening to my story and considering 
my views.
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    Mr. Cole. Well, Dr. Fischer, I want you to know my science 
teacher kept me on the edge of my seat too. But I was wondering 
whether or not I could pass. I am glad yours was much more 
successful.
    I am going to open up. And an interesting common theme to 
me in all of your remarks was, frankly, how many different 
things are necessary. We look at this often as a financial 
problem, but as all of you have mentioned in different ways, 
there is a whole panoply of support here. And we know if we 
provide it, it really pays off.

                            ITEMS FOR FOCUS

    Now, having admitted that up front, I am also going to put 
you on the spot collectively, and I will start with you, Dr. 
Fischer and then just work across, and ask you, if you had to 
pick one or two things that in your experience are 
extraordinarily important for us to focus on as a committee, 
what would those things do? Because we are usually in a 
position of having to make choices up here. We never have as 
much money as we would like. So if you had to say this is the 
one that makes a difference, if you have to prioritize, where 
you would prioritize, I would love to get your response. So if 
I can start with you, Dr. Fischer.
    Ms. Fischer. That is a big one because it is overall----
    Mr. Cole. It is very unfair too.

                           REACHING STUDENTS

    Ms. Fischer. It is.
    I think one thing that is really important, first of all, 
is reaching students as soon as possible. I discovered through 
my children that they learned a lot about education through me. 
And they started talking to their friends. And I actually am 
able to go talk to classrooms in my kids' schools now about 
this process because they are curious and they want to know. 
And many of them don't think that they can do this. And so I 
think that it is really important, to start reaching them as 
early as possible, so that they know what to dream about.
    And also, while we need money, financial things, many of us 
work multiple jobs to make this happen while some of us are 
taking care of kids, we also need the funding to have people 
available to be there for you because we don't have the 
support, a lot of us don't have the support that we need.
    Mr. Cole. Thank you very much.

                             BUILD CAPACITY

    Professor Thompson.
    Mr. Thompson. Well, you probably have guessed, I have asked 
that in Kentucky several times. The things that we know that we 
have to do now, we have to be able to build capacity. We have 
to build on those things that work. We also have to look at how 
many of the folks will have skin in the game to help us to do 
that. One of the reasons why I like GEAR UP so much, because it 
is a dollar-for-dollar partnership in what we create and how we 
do. So we get double at least the magnitude out of the federal 
dollar.
    But the other thing that I think is important, we have to 
look at--and I would agree with you--building the holistic 
capacity of a student. And it has to start early. But we also 
have to look as we get them through college--and when I say 
college, I mean in some cases it may just be a 1-year 
certificate--but the idea that many of our students still drop 
out of college because of this gap that we are talking about. 
So the need for need-based aid for completion is crucial. And 
we have research that is coming out on that all the time.
    So the idea of being able to build holistically the 
capacity from elementary school all the way through, with the 
right kind of teachers, the right kind of inputs in the 
schools, and all the way through having to make sure that they 
are college ready and career ready when they go on to college, 
but yet giving them the kind of inputs that it takes for them 
to be successful in college. So holistic capacity is one of two 
of the things that I would argue that I would consider.
    Mr. Cole. Great.

                             NEED-BASED AID

    Professor Castleman.
    Mr. Castleman. My position is much easier coming third in 
line because I can build on the insightful comments of Dr. 
Thompson and Dr. Fischer.
    To reiterate something Dr. Thompson said, I think it is 
crucial to sustain need-based aid for college. There is a 
variety of very rigorous research showing long-term benefits 
from need-based aid on outcomes. I have worked with my 
colleague and mentor Bridget Terry Long at Harvard University 
showing that a $1,300 need-based grant offered to students at 
the end of their senior year in high school in Florida 
increased the share that earned a bachelor's degree within 6 
years by over 20 percent. I think that is a worthwhile 
investment in terms of the lifelong benefits that student is 
going to get. So I think it is very important to sustain 
financial aid.
    I also think Dr. Fischer's point is very well taken, that 
even with financial aid in place students encounter very, very 
complex decisions in evaluating where to go to college, how to 
access financial aid and maintain their aid. And there are 
critical junctures along that pathway where students do not 
complete the FAFSA, they don't apply to a broad set of 
colleges, they don't renew their financial aid. Students who 
have worked very hard, showed tremendous promise for themselves 
and their families, but also for our country, may fall through 
the cracks.
    And so I think figuring out ways that we can be smart and 
strategic in how we make help available to students. And as you 
heard from my testimony, I think that technology offers us low-
cost and scalable solutions to connect hard-working students to 
one-on-one sustained advising, even if they don't have access 
to that in their households or their community.
    Mr. Cole. Thank you.

                               PELL GRANT

    Dr. Fitzgerald.
    Mr. Fitzgerald. Well, Mr. Chairman, in the spirit of full 
disclosure, I spent 17 years as the staff director of the 
Federal Advisory Committee on Student Financial Assistance. So 
we have been through a lot of battles over a lot of things, not 
the least of which was the FAFSA.
    But I would point to, not to get too technical, but I would 
point to two things. First of all, the purchasing of the 
maximum Pell Grant, because without a strong Pell Grant program 
virtually nothing we are talking about here will work.
    The second is something that we tried to do to clear the 
information barriers, and it is something we worked with 
Congress to write into the Higher Ed reauthorization in 1998, 
and that is the automatic zero. And the closer we can get the 
automatic zero to free and reduced lunch, the simpler the 
communications challenge becomes, essentially equating federal 
benefit, means-tested benefit programs. Obviously, free and 
reduced lunches in every school, the ability to communicate 
with parents about the fact that students would be eligible for 
a Pell Grant because they are a free and reduced lunch 
recipient would go a long way to reducing barriers. But it is 
expensive.
    Mr. Cole. Thank you.
    And if my friend, Mr. Fattah, will indulge me, I want to 
allow President Mellow to answer the question, then we will 
move to him. And I will be equally generous on the time.

                               TECHNOLOGY

    Ms. Mellow. Again, coming last, I absolutely agree with 
everything that has been said and said so well. So I will just 
take a slightly different tack.
    I would say that the challenge of America is not just who 
is in college, but who should be in college. And I see those 
students who have dropped out of high school, especially in 
urban areas, especially men. We are having a crisis of men who 
have dropped out of high school.
    So I would say let's really look at the higher education 
continuum as starting with students who have not made it out of 
high school and really thinking deeply about how our workforce 
development dollars align with our college dollars in ways that 
really make sense and hold us to a high standard. But in that, 
make sure that we use all the available activities that have 
just been mentioned.
    And I would especially talk about technology. The work of 
being like a 911, sort of like get them before they fail, could 
be so helpful. I have seen students drop out of college because 
they couldn't find the babysitter when their mom who used to 
take care of the kids couldn't come. I have seen students walk 
for 2 hours to college because they didn't have a $100-a-month 
Metro card. So little things can make a big difference, and 
technology can really help us see that.
    And the second piece is that I would really talk about 
deepening partnerships with business and industry, because the 
need of our students, particularly low-income students, to work 
is real. And it is real when you have two kids and you are 
working two or three jobs. It is real when you are thinking 
about college.
    So having the ability to make that connection so that the 
curriculum that I teach at our college is effective for my 
local community and that students really have the experience to 
join with a business really opens up extraordinary opportunity. 
One of our students who grew up poor in the Bronx, single mom, 
said, ``I have always had dreams, but until I had my internship 
I never saw myself in those dreams.'' And that is what we want 
to do.
    Mr. Cole. Thank you very much.
    And I thank my friend for being generous on the time. And, 
Mr. Fattah, you are recognized.

                          BUSINESS PERSPECTIVE

    Mr. Fattah. Thank you.
    I am going to start with Mr. Fitzgerald. You represent the 
business community. I spent a long time yesterday interacting 
with one of our leading businesses, IBM. They have been 
instructive in creating what are called P-TECH high schools. 
And we are bringing them into Pennsylvania, into Philadelphia. 
But they have set up these schools in a number of States. A 
number of States have acted. They create an early college 
opportunity for the young people we are talking about who are 
in challenged circumstances, 2 years of high school, 2 years 
they get an associate's degree in science. And then they get a 
certificate, a technical certificate, in a year.
    And so I am interested, obviously we are interested in 
every young person being successful. But when you think about 
the country, one of the reasons that the business community is 
interested in this is not on the idea of each young person 
being successful, it is the fact that we need these young 
people. If our businesses are going to be successful, we need 
them to be part of the workforce and the leadership force. So I 
am interested in what your sense is, given what we see in our 
economic competitors, in China and India and what they are 
doing, right, vis-a-vis all of the young people that we are 
leaving behind, and what that means to American business down 
the road in terms of finding the people they need.
    Mr. Fitzgerald. Mr. Fattah, it is huge. And IBM is a 
member. Our current chair is Roger Ferguson, who is president 
and CEO of TIAA-CREF in New York City.
    Our strategy is to support very unique partnerships between 
our business and our academic members to build new pathways, 
including from P-TECH high schools, into very high-demand, 
high-skilled jobs. So, for example, one of the NSF sites is, in 
fact, part of CUNY, and it is taking those students from a P-
TECH high school and transferring them successfully into a 
baccalaureate program in technology.
    Mr. Fattah. What I am interested in is, what is the flip 
side of that? What happens if we don't succeed at this effort 
here? What does that mean? I have heard from Bill Gates, other 
people, say, look, we need these people, and if we can't find 
them here in America to hire we are going to hire them 
somewhere else, right?
    Mr. Fitzgerald. That is correct.
    Mr. Fattah. And given the technological circumstances we 
live in, X-rays that used to be read and reviewed in 
Philadelphia, Hahnemann Hospital, are now being read and 
reviewed in India. I got insurance companies that are sending 
work via satellite overseas in the morning and getting it back 
in the evening. We have got H&R Block and others who take 
taxpayers' information and send it to India to do their taxes, 
to do the math for Americans to file their taxes. To pony up to 
their civic responsibility here.
    What I guess I am trying to get you to help the committee 
understand is that this is really not just about whether we are 
going to help some child somewhere find their future. I see it 
more that it really is inextricably intertwined with whether 
America is going to remain the leading nation in the world, 
whether we actually take kids that we have been kind of leaving 
in the shadows and give them this shot.

                               SKILL GAP

    Mr. Fitzgerald. Mr. Fattah, members of the committee, every 
one of my business members will tell you that there is nothing 
more important to the success of their firms and the United 
States than talent. And right now there is a huge talent gap. 
And it is not just talents, but it is skills.
    And this relates also to national security. So one of the 
fields that we are working in to connect young people to is 
cybersecurity. And, for example, Wes Bush, the chairman and CEO 
of Northrop Grumman, and Brit Kirwan, the chancellor of the 
university system, worked together to create the first honors 
college in cybersecurity in the country to meet the Federal 
Government's cybersecurity needs.
    So in virtually every sector there are critical workforce 
challenges, and we need the students from campuses like 
LaGuardia to be able to see pathways to any level, whether it 
is a certificate, an associate's degree, or a baccalaureate, 
because my companies and I know all companies cannot succeed 
without that talent. The jobs will go elsewhere.
    Mr. Fattah. Thank you.
    The ranking member has arrived, Mr. Chairman. And I want to 
yield the time to Rosa DeLauro.
    Mr. Cole. Okay. Well, in that case, we will go to Mr. 
Fleischmann next. And we will come to you next if that is okay.
    Ms. DeLauro. That is fine.
    Mr. Fleischmann. Thank you, Mr. Chairman.
    And to this distinguished panel, thank you all for being 
here today.
    I too am the first generation to go to college in my 
family. I had two elementary schools, three middle schools, and 
two high schools, all in the public education system, all 
around the United States, and it was tough. But to hear the 
great stories that we heard from you all today and your 
commitment to education, I just want to thank you. Because we 
cannot fail. I want to hear more success stories for our 
Nation's youth and even some adults who go back to college and 
get a shot at that great American dream. So I thank you all.
    My question is for Dr. Mellow today. I see you are from 
LaGuardia Community College. I know you have a great airport 
there, former mayor, Fiorello.
    Ms. Mellow. Yes.
    Mr. Fleischmann. Great.

                       PARTNERSHIP WITH BUSINESS

    Dr. Mellow, given your role as President at LaGuardia 
Community College and your expertise with workforce development 
initiatives, my question today is for you. In my district--and 
that is the 3rd District of Tennessee, we have Chattanooga, Oak 
Ridge, Athens, it is a wonderful east Tennessee district--there 
is a growing demand for skilled workers. Educators and 
businesses are working together to respond to this demand by 
combining hands-on training experience with classroom 
instruction.
    For example, Chattanooga State's Engineering Technology 
Department has formed a number of unique partnerships designed 
to provide training for the local workforce that will qualify 
them for high-tech positions. These partnerships include the 
Tennessee Building and Construction Institute of Chattanooga, 
the Institute of Material Joining and Testing, the Tennessee 
Valley Authority Partnership Program, the Wacker Institute, and 
the Volkswagen Academy. These programs can offer students a 
comprehensive learning environment that blends classroom 
instruction and laboratory instruction with paid on-the-job 
training experience.
    These workforce development initiatives have been highly 
successful and crucial to our local economy, and we need more 
like them. My question for you is, how can federal and state 
officials help facilitate partnerships and collaboration 
between schools and businesses to respond to the growing need 
of local employers for skilled workers? And I thank you.
    Ms. Mellow. What is happening in Tennessee is just so 
exciting. It is exactly, I think, what can happen. And it is 
very different. What is happening in Tennessee should be 
different than what is happening in Mississippi or what is 
happening in northern Washington. So the process that you 
described, I think, is very interesting.
    One of the things that happens is that, when you look at 
Department of Labor, Department of Commerce, Department of 
Agriculture maybe in some places, other kinds of federal 
agencies that could support that, the support often presumes 
that those relationships are already made, so that there will 
be funding for the enactment of that program, rarely for the 
creation. It is hard work to really create a real partnership.
    And so part of it is let's fund the whole line of 
development. Let's fund the creation of that collaboration. And 
then on the other end let's really reward the companies who put 
their time and effort into that, because it will be a real cost 
to the companies who have worked hard.
    So those would be two of my suggestions.
    Mr. Fleischmann. Thank you very much, Dr. Mellow. With 
that, Mr. Chairman, I will yield back.
    Mr. Cole. If we can, I will go to our ranking member next 
if she is ready.
    Ms. DeLauro. Thank you very much, Mr. Chairman. My 
apologies for being late. First of all, I would just like to 
say I thank you all. I have read all the testimony, so I 
appreciate your efforts, and this is an important topic for all 
of us.
    And, Mr. Chairman, what I will do is I am not going to make 
any opening statement. I will just get it for the record and so 
forth.
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    Ms. DeLauro. I will just move to questions. I would just 
like to say to Dr. Mellow, I thought I recalled your name and 
seeing you and listening to you, and it was in November 3, 2011 
where you came to the Democratic Steering and Policy Committee 
sharing Reigniting the American Dream: Americas Entrepreneurial 
Spirit as the Centerpiece of the Supercommittees Work, et 
cetera, and where you were outstanding in terms of what is 
going on at LaGuardia Community College.
    I am a very, very big believer in community colleges. I do 
believe that they should be front and center in our education 
system; that they are the path for the middle class, and to get 
the range of the students, you know, younger but older people 
who self-select to get an education.

                           ASAP INTERVENTION

    Kids reach the community college level, or older Americans 
do in that regard without all the math, reading, and writing 
skills, and you may have talked about this already, so we need 
to deal with the kind of remedial attention that they need in 
order to be able to deal with developing further their 
education. My understanding is that when developmental 
education students enter college, they succeed at a lower rate 
than their peers, and that only 15 percent of these students 
earn a degree or certificate within 3 years. A number of 
reforms have been tried, and I am excited to learn about your 
Accelerated Study and Associate Programs, ASAP intervention.
    You have had significant success in boosting college 
completion rates for these students. What was the most critical 
piece of this intervention? And a follow-up is, what funding 
was used to support the initiative? I know that the program in 
the long-term reduces costs by getting students through school 
more quickly, but it must have been a substantial investment up 
front. How can this intervention be replicated on other 
campuses with limited resources?
    Ms. Mellow. Those are really important questions. I will 
start out by why it worked. It did work because it really 
eliminated the barriers that most low-income students face to 
get a degree. So it eliminated the need for multiple part-time 
jobs. It provided the ability to go to college full-time. One 
of the reasons when we say students didn't graduate in 3 years 
is, that is because they are going part-time. They went full-
time a semester, and now they are working, or taking care of 
kids; and so part of the challenge is let's get the metrics 
right. And one of the things that IPEDS, our national database, 
doesn't do is really capture the complexity of today's 
community college students.
    The New York City experiment was really funded in multiple 
ways, primarily, though, from the City of New York. We had 
extraordinary support from Mayor Bloomberg, and now from Mayor 
DiBlasio. It took a while. It really took a while to perfect 
it. We are talking with other colleges in other States. But I 
would say it does point to what I think is a hard truth, that 
for low-income students for whom our public education system 
has not been supportive for them, or for whom life has gotten 
in the way, that we are going to make a serious investment.
    The other thing I would say is that some of the other 
experiments that have been powerful are really about 
accelerating the move through developmental education. We do it 
through contextualization. We do it through summer immersion 
programs. The issue is it is a deficit that we want to 
overcome.
    I also think there is a growing national movement to 
rethink the kind of mathematics that has been a barrier. What 
we find is that if you go into health care, if you go into a 
lot of businesses, not if you go into engineering, not if you 
go into science, but into many, many other forms of very 
productive professional work, statistics is as powerful a 
quantitative analysis as learning to factor a quadratic 
equation, which frankly as a college president, I haven't done 
recently; but I use statistics all the time.
    So part of it is that when we work more closely with 
business and say, okay, we academics, we always thought it had 
to be algebra. Working with you, what do you really need? So I 
think we have to attack it in all those multiple ways, through 
funding, through intensity, through the wraparound services, 
the intensive advising, the support that students got, but also 
rethinking our curricular structures to really make a 
difference for adults and for students today.
    Ms. DeLauro. I would just love to know, and you can get 
back to me, you said you are talking to other States, who are 
you speaking to, and how is that going and others who might be 
replicating your system? Thank you.
    Ms. Mellow. It is being replicated in Ohio.
    Ms. DeLauro. In Ohio. Thank you.
    Mr. Cole. Thank you. If we can, just by order of arrival, 
we will go to my friend, Mr. Dent, from Pennsylvania next.

                         FREE COMMUNITY COLLEGE

    Mr. Dent. Thank you, Mr. Chairman, and thank all of you for 
being here this morning. It has been a very interesting panel. 
I wanted to just talk a little bit about the Obama 
administration's proposal for free community college. I just 
heard Mr. Fleischmann make some interesting comments about the 
Wacker training programs and Volkswagen which are very 
targeted, very successful. I am aware of what many of the 
German companies are doing in the United States, trying to 
replicate to the best of their ability their very successful 
apprenticeship programs here, very effective.
    At the same time, I have been very much interested in GEAR 
UP and TRIO programs in my district that I think have been 
effective helping a lot of students who may have not had a 
background, or families who have backgrounds in higher 
education, help them move forward with their education and 
careers. I am deeply concerned about the community college 
program, because the free community college is, well, one, it 
is not based on need. I have two children in college. I am 
paying two tuitions. I don't think that the government should 
be paying for my children's tuition at a community college or 
anywhere else, given my circumstances and others like me. And I 
am not complaining, but I am just saying, it is not based on 
need. It is not targeted. I always thought the Federal 
Government's role in higher education should be very specific 
and that we should focus science, technology, engineering, and 
math on need-based assistance, and programs like the ones that 
some of you are representing here today.
    I am concerned that we will be diluting our resources very 
much, that these community colleges will no longer be community 
colleges but become Federal colleges, because in my State, the 
local communities have a very difficult time meeting their 
obligations to the community colleges, and the States and 
tuition are forced to play a greater role. If the community 
colleges see the Feds are going to pay up, I suspect maybe the 
local communities will invest less, and then we will have to 
make up the difference, and it will almost be like the Medicaid 
program, in terms of the burden that would fall on the States 
at some point down the road if Federal commitment isn't there.
    I would like to hear your comments on this about the idea 
of free community college, and how would it impact programs 
like those that you work with with TRIO and GEAR UP.
    Ms. Fischer. Are you asking me?
    Mr. Dent. Yes.
    Ms. Fischer. Okay. Free college, I have one in college and 
one that is going into college next year, and that sounds 
great. But I feel like the biggest need is to find the people 
who aren't in college, to access people or people who are going 
to college but they are not likely to make it, and I think the 
money would be better spent in programs to help those students 
navigate their way through college and support them in college, 
and maybe help them to move on like I did to higher levels of 
education, because without that, we are not going to have 
people.
    And there are people like me out there who didn't know that 
this was an option, and it may or may not help me to get there 
without the support, and I really think the money to help 
support the people while they are in there is very helpful.
    Mr. Dent. So essentially, you are saying we should target 
these funds much more than a broad just throw all the money out 
there.
    Ms. Fischer. Correct.
    Mr. Thompson. In Kentucky, we don't have community support 
for community colleges. It is State-supported and tuition 
supported.
    Mr. Dent. All State and tuition, no county governments or 
school districts.
    Mr. Thompson. No. Which has been very problematic to us 
because I do believe that community colleges should be our low-
cost alternative to some of our 4-year institutions, and I 
would have no problem with my children going to community 
colleges. What I do feel that we could do is be able to help 
the students that may not have money for access to go to 
community colleges. I will say another item, and I am glad the 
ranking member actually made this statement.
    One way of looking at--many of our community colleges are, 
they have students that are in remedial need. If we help K-12, 
slow that down and help them, we won't have as much of that in 
our community colleges or in Kentucky, many of our 4-year 
institutions. My argument is that whether we have free 
community colleges or not, we have got to figure out a better 
way to get more students engaged and some low-cost 
alternatives, and I believe community colleges could be that 
direction. We could do that with financial aid, need-based aid, 
and so on. But more than just access, we have got to help them 
to success because it is better to keep them than to try to 
recruit them again.
    The last statement I will make about this is that when we 
look at students that are highly engaged for a variety of 
reasons, whether they have the income or not have the income, 
if they are highly engaged, then they have a greater chance of 
getting success. In other words, we need to target our dollars 
towards that engagement, whether it is in K-12 with programs 
like ours, or whether it is in the community colleges or other 
4-year institutions whereby they can actually get involved at a 
deeper level than we see many of them having the opportunity 
now.
    In Kentucky, we have almost 1,000,000 students that are 
adult learners that could come back that have some college 
degree. We need to target dollars toward getting many of these 
students back engaged to become active members of the 
workforce.
    Mr. Dent. Thank you. My time is expired, and I yield back.
    Mr. Cole. Thank you very much. If I can, I will go to my 
good friend from California, the gentlelady, Ms. Lee.

                          SPECIAL POPULATIONS

    Ms. Lee. Thank you very much. I want to thank our witnesses 
and our panel for being here today, and I want to ask you a 
couple questions. First, let me just preface it by saying now a 
lot of attention is focused on the nontraditional student. It 
is nice to see that because now I know that I was a 
nontraditional student. I wondered what I was. Okay. I was a 
single mom with two kids, on public assistance, receiving food 
stamps, work study. I couldn't live on campus because I had two 
kids. Day care was so expensive I had to take my children to 
school with me, the whole 9 yards.
    Now fortunately, in the day, I could stay on public 
assistance while going to college, and I could stay on food 
stamps. And I wanted to ask you as it relates to now the budget 
cuts, as it relates to food stamps, and under welfare reform, 
the time limits and the work requirements, what are you seeing 
in terms of students like myself and how difficult or easy it 
is now for them to complete college? That is the first 
question.
    Secondly, as it relates to formerly incarcerated 
individuals, there is a lifetime ban on Pell grants if you have 
been in jail. Once you have paid your dues, once you have 
completed your time, many of us believe you deserve a second 
chance. Yet this lifetime ban on Pell grants prevents people 
who have already been punished, who are out trying to take care 
of their families, they continue to be punished because they 
can't receive Pell grants to go to college. Could you kind of 
tell me what you think about that, and do you think that is a 
reasonable policy? Or do you think we need to look at a change 
in that to provide access to formerly incarcerated individuals, 
which are primarily African American and Latino men?
    Ms. Mellow. Let me start with your first question, which is 
it is hard for poor people who are accessing social support to 
continue in college, and yet like you, so many are. And so all 
I can say is that those are hurdles that are placed in front of 
people, and the extraordinary challenges are often faced, and 
then we see successful role models like yourself. So I am going 
to go back and tell all my students to look you up.
    Ms. Lee. But tell your students also there was a safety net 
in place that hadn't been gutted or cut.
    Ms. Mellow. Yes, it is hard. It is hard. And many community 
colleges work very hard to maximize social support so students 
can really get what they need. And probably, my chancellor is 
not ready for me to say this, but I feel very strongly that 
looking very deeply at issues around punishment and redemption, 
that looking at what should be an American role for individuals 
who have both committed a crime and paid for that crime and the 
punishment that we said, what should we do to bring those 
individuals back into society?
    I think that is an extraordinarily important issue. I think 
it has to be carefully analyzed. You know, when I think of my 
student body now, who do I want to invite in? Who do I want 
sitting next to some 19-year-old at 9:00 at night when she has 
just worked all day? Those are tough questions, but we haven't 
had that dialogue in a very long time.
    When I was 24 I taught in the Maryland minimum security 
prisons. It was the scariest walk through the prison, I don't 
know what you call it, the yard, that I have ever had in my 
life; and they were the most extraordinary learners I had ever 
met. And so, I think we have to engage in this, because 
otherwise we have doomed generations of people to have no way 
back into society, and so I very much agree that while it is 
tough, and I am not sure where I would fall, that the time to 
have that kind of serious dialogue is now.
    Ms. Lee. Mr. Thompson.
    Mr. Thompson. Let me speak as an African American man. 
Without a doubt, education is almost a cure-all for all those 
things that you mentioned. Whether or not they will be on 
public assistance or in prison, we know that there is a direct 
correlation, some would even argue causal analysis--I am a 
statistician, but it has been a few years since I have done 
that, too--to say that education truly is the preventative 
measure by which we might get there. But I will tell you this: 
We have a crisis in society, and we have to admit that crisis. 
Much of that falls around men, yes, but African American men in 
particular. If we are not getting these folks engaged somehow 
or reengaged, then I think we are losing a key element of who 
we are as a society.
    So my argument simply is this: Whether or not it is as 
simple as letting them have voting rights or getting them 
involved in other activities to be reacclimated to society, 
whatever it takes, we better figure out a solution, because if 
we keep seeing what is happening in our society based on this 
disfranchisement, then I think we are going to end up having 
many more issues than we could ever think about having.
    Ms. Lee. Thank you, Mr. Chairman. I hope we can talk about 
this in terms of barriers to accessing higher education at some 
point from this committee, because there are certain issues I 
think that could be bipartisan that we need to work on that I 
think both sides could agree on.
    Mr. Cole. I would like to work with the gentlelady on this 
and find some way to do this, and a lot of this would, to me, 
get down to where if we remove the ban, then what do we do to 
empower you to be able to make discriminating decisions. I want 
you to be able to exercise judgment in a way that we can't from 
a distance, but you might be able to. But I think my friend 
raises a really, really good point that we ought to continue to 
look at. So thank you very much for bringing it up.
    Ms. Lee. Thank you very much.
    Mr. Cole. If we can, I am going to go to my good friend, 
the gentlelady from Alabama, Ms. Roby.

                           EARLY INTERVENTION

    Mrs. Roby. Thank you, Mr. Chairman. Thank you all for being 
here today, and thank you all for your sincere commitment to 
help Americans succeed, so I really appreciate what each of you 
do. Just yesterday I met with TRIO representatives from my 
State, Alabama. And as you know, TRIO dollars are so important 
to work with first-generation, low-income college students. We 
know that there are tremendous success stories with TRIO, with 
programs starting as young as the sixth grade. And so my first 
question is--and any of you feel free to jump in--but what 
grade do you think is the perfect time in a perfect world for 
early intervention to help these children succeed? Anybody. All 
of you.
    Mr. Thompson. I will tell you that we know that if you are 
not able to read or be at grade level by Grade 3, you are in 
trouble. Right?
    Mrs. Roby. Right.
    Mr. Thompson. So I am going to argue early childhood 
education is super important. I am going to also argue that 
that has to be a continual effect, because we also know that 
even high-performing 3rd and 4th grade students that are of 
low-income or of color tend to lose that trajectory by the time 
they get to high school because we are not having the kind of 
intervention that we need to have in order to keep them going 
in that direction.
    Once again, we talked about GEAR UP and these TRIO 
programs. GEAR UP starts in the 7th grade. My argument is we 
should even back that up somewhat. But when you look at early 
childhood education, we have to do something about that. We 
just have to. Right? But we also know that we can't just do 
that. We are going to have to have the kind of intervention 
that we are trying to do with our TRIO programs and GEAR UP in 
the earlier years, but I would say starting heavily once again 
in the 4th and 5th grade.
    Mrs. Roby. Okay. Yeah. Sure.
    Mr. Castleman. Thank you very much. I think it is a very 
important question. I very much agree with Dr. Thompson. I 
think there is a lot of very good, long-term rigorous research 
saying that investments in quality preschool education and 
early learning opportunities generate long-term benefits that 
affect whether students go to college and are successful, that 
affect how much they earn, and that affect their health, their 
criminal behavior or lack thereof. And so I very much agree 
that the earlier we can make investments in education, the 
longer benefits we can generate.
    At the same time I imagine as a committee you are 
constantly wrestling with the question of where do you direct 
the scarce resources that you as a committee and we as a 
country have access to. I believe that--I certainly agree with 
Dr. Thompson about starting early. I think there are millions 
of students across the country who have done the hard work to 
be academically ready, and in many cases, socially ready for 
college and struggle when they get to junior and senior year to 
identify colleges that are a good match for their abilities and 
interests, and that struggle to access the financial aid that 
our country makes available to students if they complete the 
application.
    There are hundreds of thousands, if not over 1,000,000 
students, who would be eligible for aid who do not apply. I 
think for the committee's work, as you continue to invest in 
education, broadly hopefully, I think there is an opportunity 
to make very targeted low-cost investments for academically-
ready students in their junior and senior year that can lead to 
substantial improvements in the share of traditionally 
underrepresented students who are able to get to and then be 
very successful once they are in college.
    Mr. Thompson. Here, here.
    Mrs. Roby. Anybody else?
    Ms. Mellow. I will take a slightly different tack, and I am 
going to use Dr. Fischer's words, who went to college and was 
the first in her family to go to college and has young children 
who watched her go to college, and she did it as a returning 
adult. And the other way to think about dealing with low-income 
students who are in those TRIO programs are also that 
sometimes, their parents are going to community colleges and 
really thinking about that as also an investment in a 
community. There is nothing so powerful as seeing your mom or 
dad study as a role model.

                       STUDENTS WITH DISABILITIES

    Mrs. Roby. Sure. Dr. Castleman and Dr. Thompson, how do 
colleges and universities and organizations ensure students and 
student services are coordinated, especially for students with 
disabilities? And I have got just a little bit of time, so----
    Mr. Thompson. I think that is a crucial question. As I said 
earlier in my testimony, the more you can coordinate these 
efforts, the greater impact you will have. We have to start 
thinking about critical mass, right. So the idea we may not 
ever be able to measure exactly what inputs or formative 
outputs that each of these individually have, but what we know 
is that once they are coordinated under one umbrella that 
focuses on particular goals and outcomes, then the greater 
chance that all of them will have a larger capacity. But my 
argument is just not those programs that are located within 
those walls. It is also getting community resources to buy into 
this.
    Businesses are able to do this. Churches are able to do 
this. Right? It is being able to develop peer leadership 
programs that they can build. So it is taking those and then 
doing a SWOT analysis, if you will, and looking at where the 
holes are----
    Mrs. Roby. Right.
    Mr. Thompson [continuing]. To build that capacity. So in 
the short amount of time I have, I will just say this: That 
that is what all of us should be doing within the four walls, 
looking at how they can be better coordinated and then doing a 
SWOT analysis and seeing what else we can put into it from 
outside the walls.
    Mrs. Roby. Thank you. Sorry, my time expired. Mr. Chairman.
    Mr. Cole. If you would look to go ahead and finish that 
answer, please do, Mr. Castleman.
    Mr. Castleman. No, sir. I don't have anything to add beyond 
what Dr. Thompson shared.
    Mrs. Roby. Thank you, Mr. Chairman.
    Mr. Cole. Again, we will go to the other gentlelady from 
California, Ms. Roybal-Allard.

                         YEAR-ROUND PELL GRANT

    Ms. Roybal-Allard. Thank you, Mr. Chairman. Many colleges 
and universities offer accelerated degrees which allow students 
to work through the traditional summer break to finish their 
degrees faster, and this is particularly important, as has been 
mentioned, to low-income students who are often motivated to 
enter the job market as quickly as possible. It is my 
understanding that these programs also help with retention as 
students face a gap semester are less likely to come back the 
following semester and are more likely to drop out altogether.
    Unfortunately, Pell grants now only cover tuition from fall 
to spring, and that means that students who wish to accelerate 
their studies have to either take out more loans or skip summer 
classes altogether. The year-round Pell grant offered some 
relief in 2010 and 2011, but unfortunately was eliminated in 
2012.
    I recently spoke with President Covino at Cal State L.A. 
University about the Pell grants. And based on his observations 
and experiences, he found that these grants actually helped 
students to graduate in a more timely manner and improved the 
University's graduation rates.
    Dr. Mellow, I will start with you. Did you find this to be 
true at LaGuardia Community College? And what would be the 
impact of restoring the year-round Pell grant for low-income 
students? And what would be the benefits of reinstating this 
program, say, for example, to our economy?
    Ms. Mellow. It really was a wonderful program. When you see 
students struggle so hard to get through a semester and the 
gears are starting to turn; they are sort of getting into it, 
and then Pell no longer covers summer, it slows them down. And 
to build up that energy, we talked about your need to not only 
do the academic work, but you have to change a mental model of 
yourself. And when you go back to, you know, washing dishes or 
doing luggage at LaGuardia Airport from 12 to 6 a.m., it takes 
that away from you. We found that sort of sunshine that shone 
on us for a little bit of time with the year-round Pell was 
very important for exactly the reasons that you stated.
    Ms. Roybal-Allard. Yes?
    Mr. Castleman. The other issue that I think is worth 
mentioning, and I imagine many on the committee are aware of 
this, is that one of the challenges I think we face in 
increasing the share of students who earn a degree is the 
extended time in which it takes students to complete. You all 
probably know that 50 percent roughly of first-time college 
students earn a degree within 6 years. The time to a degree is 
actually growing over time, and I think finding ways like 
students being able to takes courses over the summer can 
increase the speed with which they can earn a bachelor's degree 
or an associate's degree. That is certainly beneficial, I 
think, to our economy to have smart, well-trained people 
entering the labor market earlier and may also be very 
beneficial to the student in reducing how much they need to 
borrow.
    I think year-round Pell is one approach to that. I think 
the ASAP program that President Mellow discussed is another 
very innovative and promising solution.
    I want to draw attention, some of you may be aware of an 
organization called Complete College America that works with 
33, 34 different States to develop other innovative solutions, 
like increasing the number of credits students complete during 
the academic year, increasing the share of students who get 
intrusive advising, to use President Mellow's phrase, and 
providing students more structure and guidance around their 
course-taking to choose courses that move them more effectively 
towards a degree.
    I think all of these strategies are very important to 
reduce the time it takes students to earn a degree, so that 
they can get out in the labor market, get better jobs, reduce 
the amount of loan burden, and I do think that additional Pell 
funding during the summer could be part of that solution.

                             AFFORDABILITY

    Ms. Roybal-Allard. Thank you. President Obama's America's 
College Promise Initiative would help make college more 
affordable for community college students across the Nation. 
However, tuition is just one component of the cost of attending 
community college, and many low-income students already receive 
free or reduced tuition or fees in different States. The 
Community College League of California has found that other 
costs of college, including textbooks, transportation, and 
living expenses, are far more substantial and far more likely 
to prove a barrier to student success. Would there be a value 
in allowing flexibility in funding for this initiative beyond 
just tuition and fees, and is there a better way to target this 
initiative so that it makes community college more financially 
accessible to low-income students?
    Ms. Mellow. I will quickly say that one of the things that 
is important, I think, is to understand that so many of these 
students, because they are low-income, and because community 
colleges are relatively low cost, tuition is one part of the 
problem; but the other thing you do when you apply with your 
FAFSA is to really understand the gap. And the average gap in 
terms of what a student actually needs at LaGuardia to maintain 
their ability to go to college, is, on average, $7,000 of unmet 
needs.
    So I think what we are talking about is a huge watershed 
moment in American history. It used to be that a high school 
diploma was enough. We are now saying for our country to be 
competitive, it has to be more, and I think the challenge is 
what should we do to allow students to get what they need for 
our country and for our economy?
    Mr. Thompson. And let me just add, especially in community 
colleges, I think this is true, life intervenes with many of 
these students. And when we see students dropping out, it is 
for financial reasons mainly. It is not just tuition. Very 
seldom it is tuition. It is a variety of other inputs that 
happen in their lives, whether it is a family issue or they 
can't afford the books. We have seen students, literally, we 
have looked at them--I was on a campus for many years as the 
enrollment manager and the head of retention and student 
success, and we were a campus that served a lot of first-
generation, low-income students from Appalachia.
    We saw many of these students who had full rides, if you 
will, as far as we think of full rides in college, but they 
hadn't gotten their books 3 weeks into the semester, or 4 weeks 
into the semester, because they didn't have the money to do so. 
With that, what we found out, these students could not catch 
up. So it is that. And I wanted to add one other thing to my 
friend here. And even the Pell grants, we have to do more in 
colleges with structured degree programs, having accelerated 
opportunities, but also having developmental education figure 
out a way to make those hours count better and stop the gateway 
course problems or the barriers. But we also know that if we 
could use financial aid in a more efficient manner toward 
helping students succeed, whether its financial aid for books 
or a variety of other issues, I think then we would have a 
better opportunity of getting more of these students across 
that barrier.
    Mr. Cole. The chair wishes to advise people when you hear 
the whistling, that is the wind. Okay. That is not the mics. 
That is just one of the peculiarities of our building. We tried 
for years to deal with this, but it quite often makes a 
dramatic point. I want you to be aware. If I can, I want to go 
to my friend, Mr. Harris, from Maryland.

                        TECHNOLOGY IN EDUCATION

    Mr. Harris. Thank you very much, Mr. Chairman. Thank you 
for holding the hearing. You know, as a University faculty 
member on leave, I have an intense interest in making sure that 
our workforce is educated and the best in the world to compete. 
I am sorry we had to step out, because you know we have the 
Agriculture Subcommittee meeting, and I have a big rural 
district, so I was over there. But actually one of the topics 
that we just discussed about over there actually is important 
to this; and, again, I haven't heard all the testimony, so I 
don't know if you have touched on this. But we have all been 
talking about, I hate to say it, more or less traditional 
approaches to education, classroom-oriented, you know, things 
like that. But, you know, my teenagers learn in a very 
different way. When my son had trouble with algebra, he went on 
the Khan Academy, and he learned more online than he learned in 
a traditional classroom, and you know what, it was free.
    You know, there are these people who think given the new 
technology and given the new generation, look, I probably have 
enough bias that it would be hard for me to do, but my daughter 
in nursing school, this semester, two of her courses are the 
ones she has to actually touch patients, so she can't do that 
online. The other three are online courses.
    I have got to believe that the great equalizer in the world 
is the Internet. If we give people access--now we will need 
things like intrusive advising, so that we make certain because 
people who teach online tell me that is the problem. The 
student's not there. You don't know when they are falling 
behind, so you do have to track it. It becomes a different way 
of teaching. But, my gosh, if you want to equalize education, 
this is a tremendous opportunity. I am not sure, and I want to 
hear how in the areas in which you operate, how are you using 
this tremendous opportunity, because you know the cost, and you 
know, President Mellow, you know that once you take it outside 
the traditional classroom, university and capital and all the 
rest, we bring down the cost way down.
    So how are we using this new technology, this new ability 
to teach in order to achieve what we are talking about here 
today? Because I think you can actually educate at a lower 
cost, not a higher cost, if you do it right and you use some of 
these new technologies.
    So again, it is wide open. Anyone wants to address it. How 
do we do this? My understanding is, I guess, the University of 
Georgia said look, we could do this, $10,000, we could educate 
someone, give them a 4-year college education if it is all 
online and we do it right.
    I am not sure you can do it all online. There are some 
things you just have to learn in person. But, again, wide open, 
what are your thoughts on this? How do we go for it? How can we 
encourage this on this subcommittee?
    Mr. Castleman. Dr. Harris, I very much appreciate the 
question, and I agree with you that I think much of the 
exciting development in higher education, and in education more 
broadly, is figuring out how to leverage technology to deliver 
content in at least a more cost-effective ways, but potentially 
in more pedagogically-informed ways, so I think there is 
interesting work with tablets, for instance, that can be 
responsive to students and make learning more personalized. I 
think there are a variety of programs that provide online 
education that allow students who wouldn't otherwise have the 
opportunity to participate in college to do so.
    And so I think there is a tremendous amount of promise in 
practice. I think that the quality varies substantially, and so 
I think there are some online college programs, for instance, 
where instead of a person lecturing in a classroom in a 
building, they are now lecturing on a video, and students may 
not be getting a lot of value. I think that some programs 
struggle with issues of attrition and student engagement. I 
should say by way of full disclosure that my mother is the dean 
of a school of continuing education that certainly thinks about 
these issues, and so I get to hear her perspective often on 
this.
    What I would suggest, from my perspective that I think the 
Federal Government can do, is provide support for the further 
development of innovative practices around technology-based 
education or technology-infused education, but to structure 
those programs in a way that the providers have to rigorously 
evaluate what they are doing, because I think our greatest need 
in some ways is not the development of additional innovation. 
We should do that. But our greatest need is to better 
understand the relative success and efficacy of the different 
innovative practices that are currently on the market to help 
inform policymakers and educators of where to then invest more 
substantially.
    Mr. Harris. Let me just add, you know, because the issue 
was, a lot of students that we are talking about have one, two, 
three part-time jobs. It is hard for them to schedule Monday, 
Wednesday, Friday, 6:00 to 7:30 at night at the community 
college. Again, with the Internet, you don't need it. My son 
goes on Khan Academy at 10:30 at night until 10:45, and that is 
it, and he can schedule it in, so with that----
    Mr. Thompson. Let's take it one step farther. I have been a 
professor a lot of decades. I won't tell you how old I am 
either, but I will tell you that the sit and get is long over. 
We are going to have to think of that. Don't get me wrong. 
There is a need to have face-to-face interaction with students 
in engagement in a variety of ways, but you can engage also 
online. What we have found out in Kentucky, and our community 
colleges have led the way here, is competency-based education, 
the idea that many of the folk are coming to the table with a 
lot of knowledge already, and we haven't been able to measure 
how much knowledge that is. Now we can. I mean, with credit for 
prior learning. But also that as they reach a certain level of 
competency, they can move on when ready.
    So it is more than just online education, and it is more 
than just thinking about online education purely as a way of 
delivering instruction. I think we have to get better at this. 
We just got a couple of our campuses, our 4-year campuses, who, 
with our community colleges, got an experimental site from U.S. 
DOE to allow for caliper (ph) dollars to be used in this 
approach that we are piloting.
    So there are ways that we need to be thinking about this. 
There are ways that we can also get interaction from the 
workforce or the employers to help us to understand exactly 
what are those competencies in addition to what we feel, as 
professor types, that are needed in order to create the kind of 
degree in a faster manner that would be more of an employable 
opportunity for these students.
    Mr. Harris. Thank you. I yield.

                          SUPPORT FOR STUDENTS

    Mr. Cole. Thank you very much. I think my friend from 
Maryland makes a really important point, because we are all 
worried about costs, and we are worried about resources, so we 
are constantly searching. But also I reflect back on my time 
when I used to teach in college or my time as a student or just 
being around, and so often, it is one thing to learn online if 
you are used to doing that and you are at home surrounded by a 
family that is supportive. It is quite another thing if nobody 
in your home has ever gone to college and then you start there.
    So these things work for some kids, and they just simply 
don't for others. Dr. Fischer, I want to call on you, and all 
of you have such wonderful, unique personal experiences, but I 
found so often when I look at students, it is actually the 
intangible stuff that makes the difference. It is a role model 
when you don't come from a family that has them. It is, as you 
mentioned in your testimony, the support system around you, 
quite often from people moving through exactly similar 
circumstances to you, and it is having seen somebody else 
succeed, you sort of know that you can.
    So I would like you to reflect both on your own career and 
your interaction with students now as a professional about 
those intangible things, and we can't programmatically create 
those things, but we do do programs like TRIO where the odds of 
that happening go way up for a student as opposed to----
    When I used to teach at the University of Oklahoma as a 
graduate student and an adjunct professor, I used to see kids 
showing up that were living in dormitories that were bigger 
than the towns they were from. And you put a kid in a dormitory 
with a thousand other kids that are their age, and I guarantee 
you, you don't have a socially reinforcing learning experience 
going on there most of the time. Anyway, your reflections would 
be most welcome, and your suggestions would be helpful.
    Ms. Fischer. Okay. The non-financial aspects are huge. I 
was considering your question, Dr. Harris, because in the 
situation that I was in, even if online education were free and 
available at the point, I would have never even considered 
doing it because I didn't have the support or even knowledge or 
understand that I could.
    And so coming into a program where I had--McNair is very 
unique, I believe, because the professors on campus serve as 
advisors, and so every time I was going through the halls, 
there was this connection between professors and advisors, and 
they were constant support, and everywhere I was, there were 
people telling me that I could do it and that I was doing a 
good job, and you do learn through that process. I think that 
is probably even more important than the financial, although 
you can't get through it without the financial. You just can't 
make it without those intangible things like people there all 
the time to support you and show you that you can.
    Mr. Cole. Any of the rest of you have, again, specific 
strategies or examples? Again, that is just very helpful to 
hear, because learning is not an easily programmable, technical 
process. It is a very human process, and everybody approaches 
it in a different way and usually from a different starting 
point.

                               ATTRITION

    Mr. Fitzpatrick. Mr. Chairman, one of the challenges that 
we are confronting is the attrition rate in the first 2 years 
of college. This is particularly problematic among STEM majors. 
Fifty percent of STEM majors drop out of the major in the first 
2 years, and a surprisingly high percentage drop out of 
college, even though they are well-prepared.
    And so one of the strategies we are using, and again, this 
is in forming partnerships with our business members, as we 
create these new programs in data science and cyber security, 
social mobile cloud technologies, risk analysis and management, 
water materials science, et cetera, is to use the company's 
employees as mentors, to connect them to workforce to a career. 
The honors program in cyber security at College Park is 
sponsored by Northrop. Every one of those students gets a 
Northrop engineer as a mentor. Each can compete for early 
internships that make a huge difference. Now this assumes they 
have arrived on campus, and we are focused on just preserving 
human capital. But those connections, whether they are mentors 
when students are in high school, and Northrop and our other 
defense contractors do a lot of that through CyberPatriot and 
FIRST Robotics and other kinds of programs, but encouraging 
mentorships can be exceptionally powerful.
    Mr. Cole. I have to tell you, I have seen a Northrop 
Grumman program actually in Lawton, Oklahoma, which is a STEM 
program deep into the high schools. This is a high school that 
is now our highest performing high school in the State. And the 
corporate involvement there--that happens to be the home of the 
field artillery, and there is a big demand for computer 
programmers and for people that can work on very sophisticated 
weapons system. What they have done there, number one, it has 
been wonderful for the community; but number two, in terms of 
providing a local workforce that can move into some of the 
operations they have there, it has just been absolutely 
fantastic. So I appreciate your making that point. If I may, I 
will go to my good friend, the ranking member from Connecticut.
    Ms. DeLauro. Thank you. Dr. Fitzgerald, I would just say 
that working with some of our high schools in my community with 
Platt Tech and others who work with United Technologies and so 
forth and some of our small businesses, our manufacturing small 
businesses, who help to train these youngsters and then put 
them to work after; it is an internship; it is an 
apprenticeship; it is all of the above, and it has proved to be 
remarkably successful.
    I would just let you know this piece of information, that 
there was a budget rolled out yesterday that if any and all of 
you are interested in the Pell grant, the budget that was 
rolled out yesterday would freeze the Pell grant dollars at the 
current level, and that would freeze it for the next 10 years. 
I think that is not very forward-thinking, but I mention it to 
all of you as educators that you should engage in the debate 
and discussion around that issue.
    Dr. Castleman, a pleasure to see you. Mr. Chairman, Dr. 
Castleman was an intern in my office in 1994, so yea, team 
here. This is great.
    Mr. Cole. Before or after you were a doctor?
    Mr. Castleman. Well, well before.
    Ms. DeLauro. Well before.
    Mr. Cole. Well, clearly you had the appropriate role model, 
and you were driven to success.
    Ms. DeLauro. Well, from Madison, Connecticut. I have a 
couple things on technology I want to ask you, Dr. Mellow, 
about faculty at community colleges and their intermittent, 
part-time, adjunct, et cetera.

                                TEXTING

    Dr. Castleman, we have talked about technology, and we have 
talked about, you have looked at this text messaging in 
addressing the summer melt issue. How would that strategy work? 
I won't go through all of this effort, and it is cheaper, I 
might add, at about $7 a student to move in this direction. How 
would that interact with something like TRIO or GEAR UP? What 
are the barriers that exist to allowing this to go to scale?
    Mr. Castleman. I think that is a great question. I am very 
excited to be here just a week after or so it appeared in the 
Federal Register that GEAR UP is directly embracing these 
strategies in collaboration with Institute for Education 
Sciences and with Apps Associates to launch a national 
demonstration project on how GEAR UP can use digital messaging 
like text messaging to provide students with personalized 
reminders throughout the summer after high school, but 
continuing into college as a low-cost way to support students 
after they have gone through the wonderful support of the GEAR 
UP program to continue to succeed in college, and so I think 
that is already happening within GEAR UP.
    I think there are also lots of opportunities for this to be 
integrated into other dimensions of the Federal Government's 
higher education-related programming, like Federal student aid, 
and within the loan entrance counseling process. In order for 
these technologies to scale, they are not expensive. The 
messaging itself, sending students personalized messaging 
requires about a dollar per student per month that we want to 
send messages as a ballpark. And what we need in order to do 
that is an access point through which we can collect contact 
information.
    The FAFSA provides a tremendous access point. We know the 
FAFSA is already collecting some contact information. It could 
expand to collect others, and once students have submitted the 
FAFSA, we could be using that as an access point to provide 
much more personalized and behaviorally informed information 
that helps students understand the stages of the financial aid 
process that follow completion of the FAFSA, like verifying 
their income if they are required to by the Department of 
Education, like considering their loan eligibility.
    So we need an access point, and again I think the Federal 
Government has several. I think these campaigns benefit when we 
are able to make the information personalized to students. So 
to the extent we can leverage information in the FAFSA that 
GEAR UP has collected from students and say, Dear Aaron, here 
is some messaging that is specific to you, I think that further 
enhances the success.
    And then finally what I would say is that I think one way 
well-designed messaging can be effective, I think we also know 
as Dr. Fischer talked about earlier, that many of these 
decisions are made sufficiently complex. That in addition to 
getting personalized reminders through technology like text 
messaging that young people are engaging with, having the 
opportunity to write back to a message, to connect one on one 
to a college or financial aid professional can also be 
important, so that may be an additional need for them to be 
successful.
    Ms. DeLauro. Will we have another opportunity----
    Mr. Cole. We will go through one more round. I will go to 
Mr. Harris, and then you and I will sort of close it out, if 
that is okay. Mr. Harris, you have no questions?

                   UNITED STATES AND OTHER COUNTRIES

    Mr. Cole. Okay. So we get to split the last 10 minutes 
here. I wanted to actually make a point and then ask a 
question. I want to, number one, again, thank all of you, which 
I will do at the end. Each one of you has shown how much these 
programs that I think are the classic hand-up-not-hand-out 
programs make a huge difference for us, how important it is. 
Mr. Fattah made this point, Mr. Fitzgerald, you have all made 
it one way or the other, how important to us it is as a country 
to simply use the human talent that we have available.
    And, secondly, it is the right thing to do. There is no 
question. But it is also the smart thing to do. These are 
investments that ultimately really, really pay off for this 
country. Looking across, because some of you think 
internationally, not just nationally we have been focused here. 
Give us, and I will let any of you pick up on this. Dr. Mellow, 
you may be the appropriate one to kick it off. I am very 
interested in where you would rank us relative to looking at 
other countries and what they are doing.
    I mean, there was a time when we were the unquestioned 
leader in the world, and we provided more access than anybody 
else. We know that has changed a little bit, but I am very 
curious about where you think we are and if there are any 
international strategies that you see in other places around 
the world that we ought to be adopting here?
    Ms. Mellow. Well, it is true, Chairman, and we could talk 
for a long time about the parsing of the statistics, and there 
can be a lot of conversation about that. We are academics, 
right, we love that kind of stuff. But I would say America is 
slipping. And for me, people of my--so I am 62. Now you know--
people of my generation are more educated and when we were 
educated, than anybody else in the world. When you look at the 
20 to 24, they are about 13th, and they are less educated than 
our generation. So we are slipping internally; our kids are not 
as educated as we are, as the budding elders. I don't know what 
group I am in. But we are slipping internationally. And I think 
our acknowledgement of that has to be serious. I don't think in 
any way it means that Americans are less smart, less gutsy, 
less committed; but I think we have to really rethink how we 
imagine an education system K-12 through college, and how to 
bring back in those adults.
    Mr. Cole. Thank you. Any other care to address that? Mr. 
Thompson.
    Mr. Thompson. Let me tell you, in Kentucky we have 
something called Kentucky Rising now where we are taking the 
best K-12 countries around the world, and we are emulating what 
they do right; and we are trying to replicate that in Kentucky. 
We want to stay cutting edge on reform in that area so they can 
tell us that. I would agree with Dr. Mellow, but I will say 
that we have--by the way, gaps are the biggest things that we 
see that are creating some of the issues that make us not as 
powerful in many ways in our overall growth. But I will tell 
you we still have the best higher education system in the 
world. This is a baseline that we can play with and build off 
of. We still have some of the best intervention programs to try 
to address some of our ills. We talked about GEAR UP and McNair 
and other TRIO programs today, so there are hopes that we can 
look at.
    One other item I will add, we have also recognized, and we 
are not--we are a heterogeneous Nation. I mean, so many of our 
comparisons look very homogenous in many ways, and I wish I had 
more time to talk about that, but you know what I mean. I will 
tell you just like whether it is online education or face-to-
face, engagement still matters, so faculty still matters, so we 
know we are going to have to increase the output of our teacher 
ed folk to help them to engage those issues in our K-12. But we 
also know the interaction with faculty in and out of the 
classroom helps the retention rate. That engagement still 
matters.
    So we have the evidence of what to do, so our baseline is 
strong. Now, whether we get the right inputs to help us to 
build that baseline I think is what you guys are called to talk 
about. We know high rigor, high expectations, and high inputs 
all the way through the system of education helps us to 
actually get back to where we need to be and where we once were 
forever. I like being number one.
    Mr. Cole. Yeah, we know that in Kentucky, and I think we 
are going to see a pretty convincing demonstration of it in 
short order, too. Anybody else care to make a comment?

                           TALENT RECRUITMENT

    Mr. Fitzpatrick. Mr. Chairman, I would just like to 
highlight, I will give you two examples of the ability to find 
talent, and these are two--I won't name them, but they are two 
of my member companies--and it deals with computer science and 
the ability to grow our own talent from K-12 on up. Two 
insurance companies, both facing problems on the IT side. One 
of them moved the entire operation to Bangalore. The other 
imported chief scientists from India, and that was a very bold 
move, because you are not just taking the chief scientists and 
moving them to India; you are taking the entire stream of jobs 
and moving them.
    And so, if you look at who is in our graduate schools, two-
thirds of our graduate students in the STEM disciplines are 
foreign students. We have the best graduate universities in the 
world, but our education system is highly stratified, and if 
you just look at graduation rates, research one universities 
that are in the 90 percents. But we desperately need a talent 
strategy that will pull all of our institutions up and give 
students opportunities to access high-demand jobs that will 
benefit our companies, the Federal Government in areas like 
national security, and the Nation.
    Mr. Cole. Thank you very much. I am going to turn to my 
ranking member for the last question of the day.
    Ms. DeLauro. Thank you. Just if I can make a comment on 
what you have just said here. If we are not willing to make the 
investment, and I listened to Mr. Thompson here about early 
childhood education, K-12, we should have universal early 
childhood education, or universal preschool in the United 
States, K-12, high school, colleges, in a way that allows us to 
be able to take from zero to 3 through higher education; and if 
we view that is the way to succeed as a Nation in terms of 
economic growth, then that is where our priorities ought to be.
    One of the things that I really am concerned about in the 
U.S. is that it used to be that education was just in the 
purview of the wealthiest people who could afford to send their 
kids to school. I represent Wesleyan University, Yale 
University, you know, places, you know, that we have seen 
educate some of the brightest people in the world. We as an 
institution of the Congress, and I always view that the 
Congress has what it has historically done great things. One of 
them is to allow the sons and daughters of working families, 
low-income families, to be able to get an education to succeed. 
My dad went to the 7th grade. My mother was a garment worker in 
the old sweatshops in New Haven, Connecticut. They put me 
through college, graduate school. There were loans and grants 
and so forth that allowed me to get an education which allows 
me to sit here today.
    We have walked back from that mission, and I fear that we 
are looking at, once again, education for those families who 
can afford it; and our low-income kids, our middle class 
families' kids, are unable to be able to take the opportunity 
without the grants, without Pell, without those inputs that you 
speak about. The teachers, which is the question that I want to 
get to of Dr. Mellow, you talked about teachers and making a 
difference. Teachers that you find to be most successful with 
at-risk kids, key characteristics, how do we prepare faculty to 
educate these kids?

                          TEACHER DEVELOPMENT

    Less than a third of Community College faculty are full-
time. Adjunct faculty appointments on the rise. Given that 
part-time faculty spend less time on campus, what kinds of 
professional development should be available so we can help our 
kids who are at risk to be able to succeed?
    Ms. Mellow. And this is where technology is amazing. So 
what I am doing now is working with 150 faculty from Florida, 
Arizona, and LaGuardia. Sixty percent of them are adjunct 
faculty. And we are using technology to get people to focus on, 
what are you doing right? What does it look like? We have a 
mechanism to really code what faculty are doing so you can have 
some rigor in that. And then surround them with professional 
support so that you really think of teaching as a profession in 
the same way you would a medical doctor who would do an 
operation in front of other people and other physicians would 
help them get better.
    And so there are ways to take college teaching seriously. 
And I think technology is going to be our friend in this. But 
we must understand that now almost a third of the people 
working in the United States, from the last figures I saw, are 
entrepreneurs, they are doing it on their own. And I think we 
have to understand that we are living in a different economy. 
And in that, we have to find supports that go to the people 
where they are. So conferences are great. It is lovely to have 
a mentor. But really using technology to make a difference in 
connecting with the faculty who are teaching today in our 
colleges is essential.

                      COMMUNITY COLLEGE INITIATIVE

    Ms. DeLauro. Community college initiative, is that 
something, that the President has offered, not everybody got a 
chance to answer, just what, good, bad, mediocre?
    Ms. Mellow. I think we have to raise this conversation 
about what does it take to prepare people for our world. And it 
is no longer high school. And we have to really understand that 
community colleges are an American invention. They are the most 
democratic system of higher education in the world. Nobody else 
is like us. And how to really use that to further the interests 
of the country I think are essential.
    Ms. DeLauro. Thank you. Thank you, Mr. Chairman.
    Mr. Cole. Thank you.

                        LOCAL AND STATE FUNDING

    Just in conclusion, because I want to pick up on a point 
that my friend the ranking member made and I agree with in 
terms of resource commitment here. There is also a role, we 
didn't explore it here, but I have seen States cutting back a 
lot, if you look at the percentage of what they spend in their 
budgets, and expecting us to fill in, which stretches our 
resources. Because I think what we really want to do or focus 
on, on students that, frankly, are the most disadvantaged or 
the most challenged or, frankly, just have not had the chance. 
And that is a very important role for us as a Federal 
Government, I think, to play, and it is a national mission.
    The second area, and this doesn't apply to any of you 
because, frankly, you work in the kind of institutions that do 
this automatically, but I watched my good friend, former 
Governor Mitch Daniels, this morning talking on ``Morning Joe'' 
about college education. And he made the point at Purdue they 
have actually frozen tuition 3 years in a row. But he said, we 
are a land grant institution, our original mission was to 
educate people that were not wealthy, that did not have 
opportunities, and maybe we had forgotten about that a little 
bit and we need to move back toward understanding what our role 
is. It is different than maybe an elite private university.
    And so those are things for all of us to think of, because 
I think to get to where all of us want to be it is a collective 
effort. There is certainly a big federal component here, but 
there needs to be state and local support. In my State, 
actually local communities do support community colleges with 
taxation, and they do support career tech. They literally tax 
themselves to have that opportunity available.
    And it is up to every State to choose how they want to do 
that. I can't hold us up as a model because we are not always 
spending as much money in other areas as I would like. I have 
watched the higher education portion of our budget shrink over 
about the last 20 years in terms of not dollars, but 
percentages. And the amount of the cost of education we offload 
on a student is considerably higher today than it was when I 
was a state senator in the 1980s. We made it tougher, not 
easier. We have a lot of programs, but if you actually looked 
at it en masse, it is tougher for our kids than it ought to be.
    With that, I want to thank each and every one of you, not 
just for taking your time to be here today, because it is 
really important to help our committee understand the problems 
and to create the public record so we can make some of the 
decisions that we need to make going forward. But much more 
importantly, just thank you for what you do each and every day 
to make sure that people have an access to the American dream, 
that they get that opportunity, and that we try and address 
some of the inequalities and divisions and inequities in our 
society and give people the opportunity.
    You have all given us not only terrific information and 
great suggestions, but, frankly, the telling anecdote or the 
personal experience that quite often drives it home. So I can 
see why you are all exceptional educators and very successful 
in your field.
    So it has been a great hearing, and appreciate it very 
much. I want to thank the ranking member for being here as 
well.
    Mr. Harris, thank you.
    With that, we are adjourned.



                           W I T N E S S E S

                              ----------                              
                                                                   Page
Burwell, Hon. Sylvia.............................................     1
Castleman, B. L..................................................   507
Collins, F. S....................................................   183
Colvin, C. W.....................................................   107
Duncan, Hon. Arne................................................   309
Fauci, A. S......................................................   183
Fischer, C. L....................................................   507
Fitzgerald, B. K.................................................   507
Gibbons, G. H....................................................   183
Greenlee, Kathy..................................................   107
Insel, T. R......................................................   183
Lorsch, J. R.....................................................   183
Mellow, Gail.....................................................   507
Perez, Hon. Thomas...............................................   389
Thompson, Aaron..................................................   507
Volkow, N. D.....................................................   183