[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]


                        THE GEOGRAPHY OF POVERTY

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

                                 HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON HUMAN RESOURCES

                                 OF THE

                      COMMITTEE ON WAYS AND MEANS
                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 15, 2017

                               __________

                          Serial No. 115-HR01

                               __________

         Printed for the use of the Committee on Ways and Means
         
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT] 


                   U.S. GOVERNMENT PUBLISHING OFFICE                    
33-363                  WASHINGTON : 2019                     
          
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                      COMMITTEE ON WAYS AND MEANS

                      KEVIN BRADY, Texas, Chairman

SAM JOHNSON, Texas                   RICHARD E. NEAL, Massachusetts
DEVIN NUNES, California              SANDER M. LEVIN, Michigan
PATRICK J. TIBERI, Ohio              JOHN LEWIS, Georgia
DAVID G. REICHERT, Washington        LLOYD DOGGETT, Texas
PETER J. ROSKAM, Illinois            MIKE THOMPSON, California
VERN BUCHANAN, Florida               JOHN B. LARSON, Connecticut
ADRIAN SMITH, Nebraska               EARL BLUMENAUER, Oregon
LYNN JENKINS, Kansas                 RON KIND, Wisconsin
ERIK PAULSEN, Minnesota              BILL PASCRELL, JR., New Jersey
KENNY MARCHANT, Texas                JOSEPH CROWLEY, New York
DIANE BLACK, Tennessee               DANNY DAVIS, Illinois
TOM REED, New York                   LINDA SANCHEZ, California
MIKE KELLY, Pennsylvania             BRIAN HIGGINS, New York
JIM RENACCI, Ohio                    TERRI SEWELL, Alabama
PAT MEEHAN, Pennsylvania             SUZAN DELBENE, Washington
KRISTI NOEM, South Dakota            JUDY CHU, California
GEORGE HOLDING, North Carolina
JASON SMITH, Missouri
TOM RICE, South Carolina
DAVID SCHWEIKERT, Arizona
JACKIE WALORSKI, Indiana
CARLOS CURBELO, Florida
MIKE BISHOP, Michigan

                     David Stewart, Staff Director

                 Brandon Casey, Minority Chief Counsel

                                 ______

                    SUBCOMMITTEE ON HUMAN RESOURCES

                    ADRIAN SMITH, Nebraska, Chairman

JASON SMITH, Missouri                DANNY DAVIS, Illinois
JACKIE WALORSKI, Indiana             LLOYD DOGGETT, Texas
CARLOS CURBELO, Florida              TERRI SEWELL, Alabama
MIKE BISHOP, Michigan                JUDY CHU, California
DAVID G. REICHERT, Washington
TOM REED, New York


                            C O N T E N T S

                               __________
                                                                   Page

Advisory of February 15, 2017 announcing the hearing.............     2

                               WITNESSES

Elizabeth Kneebone, Fellow, Metropolitan Policy Program, 
  Brookings Institution..........................................     6
Mark Partridge, Professor, Swank Chair in Rural-Urban Policy, 
  Department of Agricultural, Environmental, and Development 
  Economics, The Ohio State University...........................    21
William Leavy, Executive Director, Greater West Town Project, 
  Chicago, IL, accompanied by Linda Thomas, Director of Client 
  Services, Greater West Town Project, Chicago, IL...............    35
Tammy Slater, CEO, Goodwill Industries of Greater Nebraska.......    51

                        QUESTIONS FOR THE RECORD

Question from Congressman Danny Davis of Illinois to William 
  Leavy and Linda Thomas.........................................    82

                       SUBMISSIONS FOR THE RECORD

Affordable Rental Housing........................................    85
Charles Bruner, Ph.D., statement.................................    88
Enterprise Community Partners....................................    90
Goodwill Industries International................................    93

 
                        THE GEOGRAPHY OF POVERTY

                              ----------                              


                      WEDNESDAY, FEBRUARY 15, 2017

             U.S. House of Representatives,
                       Committee on Ways and Means,
                           Subcommittee on Human Resources,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:08 a.m., in 
Room 1100, Longworth House Office Building, Hon. Adrian Smith 
[chairman of the subcommittee] presiding.
    [The advisory announcing the hearing follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Chairman SMITH OF NEBRASKA. The subcommittee will come to 
order.
    Welcome to the first hearing of the Human Resources 
Subcommittee of the 115th Congress.
    We have a good mix of new and returning members on the 
subcommittee this session, and I am honored to serve as the 
chairman of this important subcommittee.
    I would like to take a moment to introduce the members on 
our side of the dais: Mr. Smith of Missouri; Mrs. Walorski of 
Indiana, a new member of the Ways and Means Committee; Mr. 
Reichert of Washington, a past chair of this subcommittee; Mr. 
Reed of New York; and Mr. Rice of South Carolina.
    On my left, we have the ranking member for the 115th 
Congress, Mr. Davis of Illinois. Mr. Davis, would you care to 
introduce your members of the subcommittee?
    Mr. DAVIS. I would indeed. Let me, first of all, though, 
thank you, Mr. Chairman, for holding this hearing in 
particular. I certainly look forward to working with you, and I 
think we are going to be a very productive team.
    I am honored to serve as the ranking member of this 
subcommittee, and I am proud to introduce the following 
Democratic members of the Human Resources Subcommittee: Mr. 
Lloyd Doggett of Texas, who has been on the committee and is a 
senior member of the Ways and Means Committee; and, of course, 
I am fortunate to be working with two members of this committee 
and two new members of the Human Resources Subcommittee, Ms. 
Terri Sewell of Alabama, who represents a vast area that is 
called rural America--as a matter of fact, much of her district 
has been called the Black Belt of the South; and Ms. Judy Chu 
of California, who is not here at the moment but with whom I 
have had the opportunity to work on issues as well.
    So, Mr. Chairman, we are all indeed proud to be here, 
pleased to work with you and other members of the committee, 
and look forward to a wonderful time.
    Chairman SMITH OF NEBRASKA. Thank you, and likewise. I 
appreciate the conversations we have already had and I think 
some priorities that are certainly timely, and I appreciate the 
opportunity to work together.
    It is great to work with all of the members of this 
subcommittee so that we can help more Americans escape poverty 
and move up the economic ladder.
    As we all know, the Ways and Means Committee plays an 
important role in designing policies to improve the lives of 
Americans across this country. Together, members of this 
committee work to improve our Nation's healthcare system, 
modernize our Tax Code to make American business more 
competitive, improve trade so U.S. companies can sell goods 
abroad, and, in the Human Resources Subcommittee, help more 
families access opportunity to move up the economic ladder. 
This task is more important than ever.
    While the total number of individuals living in poverty has 
fallen from its recent peak in 2010, poverty rates and, even 
more troubling, child poverty rates remain much higher than 
they were prior to the recession. In addition, a larger share 
of working-age adults are in poverty than ever before, as fewer 
men and women today are employed than in the past.
    Today's hearing represents our first step to address this 
issue in the 115th Congress. Before we can identify ways to 
foster greater opportunities, we have to first understand what 
the challenges look like across the country. That is why the 
focus of our hearing today is on the geography of poverty.
    This felt like the right place to start as I thought about 
the challenges in my own district, where many locations aren't 
just rural but also remote, and that of the ranking member's as 
potential bookends of the same story. People often think of 
poverty only as they see it in cities, not realizing poverty 
today is more common than ever in suburban and rural areas. 
People also underestimate poverty in rural and remote areas, 
not knowing rates of poverty in these areas have for decades 
been higher than in urban areas.
    Our instinct might be to think rural Nebraska and urban 
Chicago are so vastly different, they have nothing in common. 
But what we are charged to do in this subcommittee is to find 
ways for individuals and families to succeed. And those 
challenges are universal, even if they require different 
solutions.
    Fortunately, the members of this subcommittee bring 
substantial expertise to bear, as together we represent a wide 
range of constituencies from virtually all four corners of this 
country. This diversity will be an asset as we explore ways to 
reduce poverty, as I know what works in one area may not always 
be what works in another. It is important we realize and 
respect the differences between the constituencies we 
represent, as too often Congress proposes national, one-size-
fits-all solutions when local flexibility is truly what is 
needed.
    Clearly, the centerpiece of any poverty-fighting strategy 
must be employment. We must make sure Federal policies support 
and reward work and make sure employment pays for those 
struggling to get ahead.
    It is also important we get incentives right so everyone 
benefits when someone moves from welfare to work, from the 
State agency running the program, to the business owner hiring 
the employee, to the individual seeking to improve his or her 
own life.
    We should also avoid the tendency to focus solely on 
inputs, like dollars spent or people served, and instead ensure 
we focus on outcomes. By prioritizing results, we can empower 
local communities with the flexibility they need to design 
solutions which have real impact on improving the lives of 
families and their community.
    I look forward to hearing from our expert panel of 
witnesses today, and I know their insights will lay the 
groundwork for our efforts to help more Americans find jobs, 
escape poverty, and move up the economic ladder.
    I now yield to the distinguished ranking member, Mr. Davis, 
for the purposes of an opening statement.
    Mr. DAVIS. Thank you very much, Mr. Chairman. And before I 
begin, let me just thank you for your altering of protocol to 
allow Ms. Linda Thomas to sit in with her coworker. And she has 
done so much work in this area, and it is just wonderful for 
her to have the opportunity to be here.
    Poverty and lack of opportunity have consequences, not just 
for individuals and their families but also for their 
communities. Seventy percent of homicides in Chicago occur in 
just 20 neighborhoods. The poverty rate in these 20 
neighborhoods is more than twice as high as the poverty rate 
nationally, and unemployment is 6 times higher.
    I see firsthand that low-income Chicagoans desperately want 
good jobs with wages that support their families, but these 
workers often lack the education, skills, and training needed 
to access those quality jobs. If they are returning citizens, 
they face significant hurdles to employment and supporting 
their families. Even for those who are qualified, there remain 
job shortages across dozens of industries.
    A new report found that in 2015 about 43 percent of black 
men age 20 to 24 in Chicago's west-side and south-side 
neighborhoods were neither working nor in school.
    At first glance, the poverty I see in Chicago might look 
different from the struggles Chairman Smith sees at home in 
rural Nebraska. Although the faces might look different, 
although the challenges and experiences that brought people 
down might be different, we have much more in common than we 
think.
    Wherever you live, the first step out of poverty is a good 
job. It sounds simple, but there are a lot of steps needed to 
make that happen. The research is clear: The first job matters. 
Good jobs lead to other good jobs.
    Workers need basic education and a way to acquire the right 
skills for good jobs, whether that means on-the-job training, a 
specialized training program, or higher education. They may 
need an employer who is willing to take a chance on someone who 
doesn't have much experience or has made mistakes in the past.
    They need to be reliable employees, and that means they 
need a way to get to work. If they are parents, they need child 
care and paid leave so they can work and still care for their 
families.
    The Federal Government has a choice. We can invest in 
lifting up those communities and those families. We can provide 
the funding for workforce development so that when we measure 
program outcomes the outcomes will be good. We can update the 
Temporary Assistance for Needy Families program and the child 
support enforcement program to give parents opportunities to 
get the skills and credentials that good jobs require. We can 
make sure working parents have safe, quality child care 
available during the hours they work.
    And we can stop insulting people by suggesting work 
requirements for programs that offer struggling families food 
or basic health care. Instead, we can acknowledge that parents 
are trying to support their families, but they can't find jobs 
or the jobs they do find don't pay.
    We need to do that everywhere in the country, from the city 
streets of Chicago to Chairman Smith's country roads.
    Thank you, Mr. Chairman. Again, I am honored to serve as 
the ranking member of this subcommittee, and, indeed, we look 
forward to the continuation of good work. And I yield back.
    Chairman SMITH OF NEBRASKA. Thank you. Thank you, Mr. 
Davis.
    And, without objection, other members' opening statements 
will be made a part of the record.
    I would like to welcome our witnesses to the table here 
today. We certainly appreciate you sharing your time and 
expertise and insight as you do share your statements here 
today.
    First, we have Ms. Elizabeth Kneebone, a Fellow at the 
Metropolitan Policy Program at the Brookings Institution.
    After Elizabeth, we will have Mr. Mark Partridge, a 
Professor from The Ohio State University. I even said ``The'' 
Ohio State University.
    Then we will have Mr. William Leavy, the Executive Director 
of the Greater West Town Project in Chicago, Illinois, 
accompanied later by Linda Thomas, Director of Client Services 
for the Greater West Town Project.
    Thank you for being here.
    Last, but not least, certainly, Ms. Tammy Slater, CEO of 
Goodwill Industries of Greater Nebraska, where she serves 55 
counties in Nebraska and operates 8 retail stores, 7 of which 
are in my district.
    And I am not sure all 55 of your counties are in the 75 
counties of the Third District, but thank you for being here.
    Thank you all for being here. We are kind of a family here, 
wanting to know more of your insights and experiences and 
expertise.
    So, Ms. Kneebone, please.

 STATEMENT OF ELIZABETH KNEEBONE, FELLOW, METROPOLITAN POLICY 
                 PROGRAM, BROOKINGS INSTITUTION

    Ms. KNEEBONE. Chairman Smith, Ranking Member Davis, and 
members of the subcommittee, thank you so much for the 
opportunity to testify today.
    This morning, I am going to spend some time giving a brief 
overview of the changing geography of poverty, including its 
growth into new and different areas. I will talk about some of 
the factors that have led to the shifts we have seen in recent 
years, some of the challenges that have accompanied those 
trends, and, finally, some of the implications for efforts to 
effectively address poverty across different kinds of 
communities.
    Let's start with the numbers. The 2000s saw poverty grow 
rapidly in the U.S., and even with the declines we have seen in 
recent years, by 2015 we still had 43.1 million people living 
below the Federal poverty line, or 13.5 percent of the 
population. That is almost 6 million more people than before 
the recession began in 2007 and 11-1/2 million more people than 
in 2000.
    When we think about poverty in the United States, we often 
think about it in the urban context or as a rural challenge, 
because that is where it has historically been concentrated, 
and as poverty grew in the 2000s, it continued to grow in those 
places. But it grew at an even faster pace outside of them.
    So, between 2000 and 2015, in big cities and in rural 
communities the poor population grew by about 20 percent. In 
smaller metropolitan areas, it grew at twice that pace. And the 
fastest pace of growth actually took place in suburbs of our 
major metropolitan areas, which saw their poor population grow 
by 57 percent. All told, suburbs accounted for about half of 
the total increase in the Nation's poor population over that 
time period.
    Now, poverty rates remain higher in cities and in rural 
communities, but today more poor people live in suburbs. In 
2015, 16 million people in suburbs lived below the poverty 
line--3 million more than in big cities, that is 6 million more 
than in smaller metropolitan areas, and 8 million more than in 
rural America.
    So why does that happen? What caused these historic shifts? 
Well, in some cases, it is because more poor people moved to 
the suburbs for any number of reasons: following job 
opportunities, which continue to suburbanize; shifting trends 
in where affordable housing is located within regions; or just 
following the amenities that the suburbs offered.
    But more so and an even bigger part of this puzzle was 
actually the downward mobility of long-term suburban residents 
over time. Part of that is because of the two economic 
recessions we saw in the 2000s, particularly the severity of 
the Great Recession. But it is not just about downturns; it is 
also about structural changes in the economy that have led to 
the growing prevalence of low-wage work. And that saw the 
typical household income fall even before the Great Recession 
hit.
    So why does it matter that all of these forces together 
have pushed poverty up and into more and different places? 
Partly it is because the places that have seen poverty grow 
fastest often were not built nor are they now equipped to deal 
with the levels of need which they are seeing today. Many 
suburbs don't have the kinds of infrastructure, like public 
transit, or support services, like a robust nonprofit safety 
net, that cities have been able to evolve and develop over 
decades.
    And overcoming those gaps is challenged by the fact that 
suburbs stretch over a really fragmented jurisdictional map. 
There are several jurisdictions, many of them quite small, that 
make up the suburbs and are just too small on their own and 
lack the capacity to marshal responses at the scale of need 
that they are seeing today.
    Also, they lack resources, partly because resources have 
lagged this rapid change in the geography of poverty, both in 
terms of philanthropic support and in terms of Federal and 
government investments in places. Some of that is because of 
the lack of capacity in these places. They are not able to 
compete to effectively bring resources into their communities. 
Some of it is by design, by the way that these funding sources 
were designed, with a different geography of poverty in mind.
    Clearly, more resources are needed to deal with the scale 
and reach of need that we see today, but even just marshaling 
and more effectively using the limited resources we have will 
require that we get to a more effective scale so we can help 
more people in more places.
    There are communities across the country that are already 
finding ways to do this. Often it is through collaboration, 
whether it is suburbs coming together to work across suburban 
jurisdictional boundaries, suburbs working with central cities 
to address shared challenges, or suburban communities joining 
with their rural neighbors to work on common issues.
    All of these sorts of strategies and models share a desire 
and effort to get to that better scale, to use these limited 
resources more effectively and in ways that can help more 
people in more places. But they are fighting an uphill battle 
to do that in the current context.
    So the way that the Federal Government could be a strong 
partner here, could align resources more effectively to support 
these types of strategies and help scale up these types of 
responses would be: one, to explicitly incentivize 
collaborative strategies that cut across jurisdictions, that 
cut across policy silos; that could, number two, catalyze 
regional capacity to try and help overcome some of these 
capacity gaps in these communities through these more 
regionally scaled entities and efforts; and three, finally, 
allowing for more experimentation and evaluation to show what 
can work at the regional level and across different types of 
communities to connect more people and places to opportunity.
    Thank you.
    [The prepared statement of Elizabeth Kneebone follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Chairman SMITH OF NEBRASKA. Thank you, Ms. Kneebone.
    And I didn't mention earlier, though, that oral statements 
are limited to 5 minutes. I appreciate your cooperation there. 
And, certainly, all of your written statements will be included 
in the record.
    So thank you, Ms. Kneebone. Mr. Partridge, you may begin.

 STATEMENT OF MARK PARTRIDGE, PROFESSOR, SWANK CHAIR IN RURAL-
 URBAN POLICY, DEPARTMENT OF AGRICULTURAL, ENVIRONMENTAL, AND 
        DEVELOPMENT ECONOMICS, THE OHIO STATE UNIVERSITY

    Mr. PARTRIDGE. Thank you, Chairman Smith, Ranking Member 
Davis, and other members. I am Mark Partridge. My views reflect 
my research and not those of The Ohio State University. Today, 
I will discuss the diversity of rural poverty in rural America 
and describe ways to reduce poverty and its harmful effects.
    Much of rural America struggles from low commodity prices 
and fierce foreign competition, yet portrayals of the death of 
rural America are misleading. Dating back to 1970s, net 
migration in and out of rural America has been about zero with 
urban America.
    In reality, there are three rural Americas. It is very 
diverse: one, fast-growing, high-amenity regions near lakes, 
oceans, and mountains; two, metro-adjacent rural communities 
with access to urban jobs and services; and, three, remote or 
extractive-based communities.
    Rural America's industrial structure is becoming closer to 
urban America. So can we show Figure 1?
    For example, Figure 1 shows the shift from the farm 
economy. From 1969 to 2015, the rural farm employment share 
declined from 15 to 6 percent.
    Rural poverty rates are greater than urban rates. 2014 
urban and poverty rates were respectively 15 and 18 percent. 
But rural poverty receives relatively little attention. One 
reason is distance from media centers. Another is that it is 
hidden and rarely concentrated in poor neighborhoods.
    Poverty greatly declined from 1959 to 1973. Poverty, 
though, is very geographically persistent.
    Next figures.
    Figures 4 and 6 from my written testimony show the 1979 and 
2015 county poverty rates for the lower 48 States, and the maps 
look very similar is my point. High-poverty clusters exist in 
central Appalachia, the Black Belt, Mississippi Delta, Rio 
Grande, and Western Native American reservations.
    Children are disproportionately in poverty. One-fourth of 
rural children and over one-fifth of urban children are 
afflicted. Fewer opportunities for poor children perpetuate an 
intergenerational poverty cycle.
    Rural policy won't succeed by the next election or save 
every struggling town, yet two broad approaches are available. 
First are people-based policies that directly support the poor, 
including education and training. The second is place-based 
policies in which poor locales receive more aid. Examples 
include infrastructure and firm attraction.
    But promoting prosperous rural communities requires 
building from within. Communities possess many entrepreneurial 
and human resources. Research finds the fastest growing U.S. 
firms exist everywhere, from small towns to large cities.
    Also, higher shares of small businesses and self-employment 
support faster future growth. Self-employment and other small-
business multipliers are double those of regular employment. 
There are many reasons. Small businesses buy more inputs 
locally, more profits remain local, and small-business 
development promotes a virtual cycle of promoting even more 
business formation.
    Small businesses can be fostered by reducing regulatory 
compliance costs. Another is improve small-firm financing. 
Small-business programs should be expanded through community 
colleges and State extension programs.
    The best predictor of future regional growth is the initial 
level of education. Yet rural America is less educated. Young 
talented adults from the countryside have long been captivated 
by bright city lights, but rural communities possess many 
charms--quiet, safe streets, sense of community and same 
lifestyles. Once former rural residents marry and have 
children, rural life becomes attractive. Thus, attraction 
efforts should be on enticing families in 30s and 40s back to 
rural communities.
    Rural communities can compete by promoting safety, 
recreation, and a clean environment. Yet good public schools 
are paramount, not only for the children, but the parents that 
are attracted by quality schools are much coveted.
    Deficient rural public services harm the poor. Fortunately, 
there are low-cost ways to improve service delivery. 
Governments can provide seed funding for rural counties to 
share personnel and resources, for example. To build capacity, 
Congress should fully fund Federal-State regional development 
organizations and create new ones--for example, the Appalachian 
Regional Commission, ARC.
    Yet poor funding hampers the ARC's efforts. Still, the ARC 
has accomplished much with modest resources. It provides bridge 
loans and seed grants for infrastructure and other programs, 
but it mainly brokers regional collaborations that cannot be 
done by one poor community.
    Other policies should be expanded regardless of residents. 
For one, the Earned Income Tax Credit provides employment 
incentives. Early childhood education is also valuable, as is 
workforce training, access to transportation, mental health 
provision, and child care. They should be tailored to account 
for world differences. Accessibility is problematic, and 
services are stretched as many communities are struggling 
economically and are afflicted by drug crises.
    In sum, with long, steady, patient effort, rural poverty 
can be greatly reduced, producing tremendous benefits for 
families, communities, and the American economy.
    Thank you.
    [The prepared statement of Mr. Partridge follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Chairman SMITH OF NEBRASKA. Thank you, Mr. Partridge.
    Mr. Leavy, you may begin.

 STATEMENT OF WILLIAM LEAVY, EXECUTIVE DIRECTOR, GREATER WEST 
 TOWN PROJECT, CHICAGO, ILLINOIS; ACCOMPANIED BY LINDA THOMAS, 
    DIRECTOR OF CLIENT SERVICES, GREATER WEST TOWN PROJECT, 
                       CHICAGO, ILLINOIS

    Mr. LEAVY. Thank you. My name is Bill Leavy. I am the 
executive director and founder of the Greater West Town 
Community Development Project on Chicago's west side.
    My agency is very honored to have been asked by Chairman 
Smith and especially Congressman Davis to testify today to 
deepen public understanding of the extent and impact of poverty 
in urban communities and to share our experience using 
community-based job training to combat poverty at the 
individual and community level.
    Our experience has shown us that intensive occupational 
skills training in partnership with local industry is a highly 
effective way to get people into quality career-track jobs and 
help them lift themselves out of poverty.
    I am very honored to be with Linda Thomas here today, our 
director of client services. She is here to answer specific 
questions you have about our program and the challenges we 
face.
    Greater West Town is a community-based economic development 
initiative dedicated to expanding education and economic 
opportunity for the low-income, primarily minority community 
residents of the greater west side of Chicago.
    We achieve that mission by providing comprehensive 
workforce development and educational services through a model 
community-business partnership strategy that links the 
employment and training needs of neighborhood job seekers to 
local economic development efforts and the workforce needs of 
area companies.
    Greater West Town services include occupational skills 
training in the high-growth industries of woodworking and 
shipping and receiving, job placement support services, and, 
very importantly, an alternative high school for youth that 
have dropped out in our community.
    Greater West Town's programs are focused also to help meet 
the needs of local employers for the skilled and motivated 
workers they need to stay and grow in the area while competing 
successfully in the global marketplace.
    Greater West Town's target populations include ex-
offenders, welfare-eligible single parents, homeless, 
dislocated workers, high school dropouts, and teen parents. 
More than 1,800 graduates of the woodworking and shipping and 
receiving programs have been placed in jobs with area 
companies.
    Our targeted community areas have historically been--I am 
going skip this because Danny has covered the poverty in our 
neighborhood so well. Danny, I couldn't do it any more or any 
better.
    I think my only point that I would like make is that there 
are major racial barriers in the labor market, and we need to 
admit them and deal with then. Unemployment rates for black men 
are disproportionally high. In Chicago, black men are twice as 
likely to be unemployed as Latinos and three times as likely to 
be unemployed as whites. So it might be controversial for you 
guys, but it is there. If you look at the numbers, it is 
jumping off the page at us.
    And, of course, a major barrier to finding jobs in our 
community--so many ex-offenders come back into our community. 
Our communities are disproportionately receiving ex-offenders 
as they leave prison. And, of course, our high-school dropout 
crisis is a huge, huge problem and barrier to economic 
opportunity. Our neighborhood high schools have reported 
dropout rates of up to 50 percent.
    Our occupational skills training is a proven and highly 
effective model that provides employment opportunities to high-
need populations. The program is designed and operated in 
collaboration with local employer partners. Our employment 
strategy, training strategy combines a bridge program with 
basic skills remediation, and that leads to a hard skills 
program, an occupational certificate program. And it is by 
getting folks into that occupational certificate program that 
we get them access to higher-skilled, higher-paid jobs.
    Greater West Town meets employer needs by providing 
trained, dependable, motivated workers. And we give employers 
special value-added labor force development services that the 
companies cannot provide or undertake on their own. Many local 
firms credit our programs for their manufacturing success and 
cite it as an important factor in their decision to remain in 
Chicago and expand operations.
    We continually upgrade our instruction with input from our 
business partners to ensure industry relevance and to make 
smart investments in cutting-edge technologies and training.
    Our commitment to support our program participants that 
ensure their success means that we continually assess 
participants' needs and provide responses in a timely manner. 
Recently, Greater West Town has expanded its focus on 
networking with other community-based agencies to help provide 
for fundamental needs such as child care, housing, 
transportation, and food security.
    Greater West Town's services are in more demand than ever, 
but resources to support our work are shrinking.
    And I think I am out of time. Thank you.
    [The prepared statement of Mr. Leavy follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Chairman SMITH OF NEBRASKA. All right. Thank you, Mr. 
Leavy.
    Ms. Slater.

 STATEMENT OF TAMARA SLATER, CHIEF EXECUTIVE OFFICER, GOODWILL 
                 INDUSTRIES OF GREATER NEBRASKA

    Ms. SLATER. Good morning. Thank you for the invitation to 
testify on the challenges and opportunities of serving people 
in rural Nebraska impacted by poverty.
    My name is Tammy Slater, and I live in Doniphan, Nebraska, 
a town of 850-plus people. I am the chief executive officer of 
Goodwill Industries of Greater Nebraska, located in the third-
largest city of Nebraska, Grand Island, with a population of 
50,000. We are 1 of 157 autonomous Goodwill organizations in 
the United States and 1 of 4 Goodwills serving Nebraska. Last 
year, all Goodwills collectively connected 312,000 people with 
employment in the United States and Canada.
    Each local Goodwill organization has an assigned territory 
that provides services with our geographic area in response to 
the community's needs. Goodwill Industries of Greater Nebraska 
services promote independence and access to the community, help 
people become successfully employed, support goals of wellness 
and recovery, facilitate group classes to teach responsible 
behavior, and provide safe and affordable housing.
    Our Goodwill mission is to serve Nebraskans experiencing 
intellectual or developmental disabilities, severe and 
persistent mental illness, substance abuse disorder, behavioral 
health challenges, and acquired brain injury. Each year, we 
serve more than 1,600 people in central and western Nebraska 
with an array of services. We help people earn jobs and advance 
their careers with specialized services to meet their needs.
    Our service territory, as Chairman Smith referenced, 
includes 55 counties and is about 54,000 square miles. Of the 
counties we serve, 30 percent have a population of 3,000 or 
fewer.
    The challenges of poverty, as we all know, from lack of 
stable housing, adequate nutrition, effective health care, 
reliable transportation, quality child care, appropriate 
education, and job training, are common to both rural and urban 
areas. How we respond to these challenges may be different 
because we do have sparse population, limited local resources, 
and scarce employment opportunities.
    Education and job opportunities are scarce, as I said, for 
people in rural Nebraska, which is a major roadblock to lifting 
people out of poverty. In 2015, rural employment was still 
below pre-recession rates, and earnings are generally lower in 
rural areas than those in urban.
    Many of the individuals that we serve require comprehensive 
services. So partnerships with State and local agencies are 
important to address the complex needs of people living in 
rural Nebraska. Community partnerships, such as our public 
schools, United Ways, areas churches, local Salvation Army 
posts, help us to build a network in order to help. Government 
partners in health and human services, like corrections, voc 
rehab, and Social Security, among others, help people living in 
rural communities get and keep their life on track.
    Though partnerships are crucial to success, it is tougher 
in rural areas because there are fewer community organizations, 
and we struggle to continue services due to the long distance 
between communities, which are expensive to maintain.
    We at Goodwill are grateful for our social enterprise that 
create jobs and help fund services. Our team members work to 
understand our neighbors in the communities we serve and how we 
equip them to overcome poverty.
    One of those neighbors is Peter. When Peter was referred 
from Nebraska Vocational Rehab to Goodwill, which that is where 
we get our referrals, he was unemployed, he was diagnosed with 
bipolar disorder, adjustment disorder with anxiety and 
depression, a narcissistic personality disorder, and receiving 
Social Security. Peter was also on probation for a felony, and 
his employment retention was beyond poor.
    Peter was able to access an array of services from our 
Goodwill, including comprehensive benefits planning, behavioral 
health day services, and our behavioral health employment 
program.
    Together with Peter, the team working to support him, 
including Goodwill staff, the local probation, his counselor at 
Nebraska VR, and his family members, he has had a great result. 
He has been employed for over 1 year, continues to work with 
our behavioral health and benefits planning. Peter is just one 
example of the complexity of those we serve every day.
    I thank you for this opportunity to share our experience. 
We appreciate the subcommittee's interest in hearing from the 
field and are very happy to serve as a resource. Thank you.
    [The prepared statement of Ms. Slater follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Chairman SMITH OF NEBRASKA. Thank you, Ms. Slater.
    Thank you very much to all of our witnesses, again, for 
sharing your expertise and this perspective that I hope we can 
all share. And we are going to go down the line here with the 
question-and-answer and just describe our districts a little 
bit.
    Obviously, I mentioned earlier that, you know, we have 
rural parts of America and remote parts. And, obviously, if 
someone has a commute in the city for various reasons, there 
can be significant commutes in rural and remote America as 
well. Sometimes I describe parts of my district in terms of the 
distance from a Walmart, maybe even a McDonald's, and it runs 
in the hours. And so it can be very different.
    And yet, when it boils down to it, many of the needs are 
similar to even that of the inner city. And, of course, 
sometimes the commute times of city life would have something 
that no one in rural America would want to tolerate. But I 
think that hopefully we will see programs, though, with 
flexibility and the intent to help people in a very authentic 
way.
    But, Ms. Slater, again, thanks for being here and certainly 
describing the district and your work and sharing some of the 
stories that you did and certainly some of the clients you 
serve. And it can be obviously challenging to address poverty 
and the economic needs of the many communities across our 
district because of distances even from organizations like 
yours, even though you are pretty well spread out across the 
district.
    Although our unemployment rate is lower and high school 
graduation is higher than in many States, I know there are 
still many people struggling to find work and make ends meet. I 
especially appreciate the story you tell about Peter in your 
testimony and how, by coordinating services and helping him set 
goals, he has been able to overcome some of the difficulties he 
has faced and now has been employed for over a year.
    At the Federal level, we are thinking about ways to provide 
more flexibility, coupled with strong accountability, to make 
sure that your organization and those like it can customize 
services and benefits so you can help more people like Peter 
succeed in the workforce.
    As we think about our efforts, what should we make sure you 
are able to do or do more of for you to be successful as an 
organization? What are some of the key factors in what you do 
which helped Peter be successful, find a job, and stay 
employed?
    Ms. Slater.
    Ms. SLATER. Chairman Smith, when I think about that 
question, the most important thing is it is not just one 
service. When I talked about the variety of services that we 
offer at Goodwill, getting a job, yes, is the main focus 
because we all know that a job gives us purpose in life, but it 
is the whole package.
    Again, someone has to, first of all, be able to understand 
and know what their barriers are and how can we help them. If I 
think about Peter, with a mental illness, again, being able to 
have people understand that illness and how do they now learn 
to cope with that disease, whatever that may be.
    Then, once they understand that, what also is important is 
giving them structure to their life. Because, again, now that 
they have this barrier or a mental illness to deal with, the 
structure of how to cope with that, how important medication 
is.
    But then, also, how do we then teach them possibly new 
skills or for them to understand what their skill set or 
abilities are, and how do we help them understand that to then 
match them with a proper job.
    Then the other challenge becomes partnering with employers, 
because we all know, you hear it across the United States every 
day, it is tough to find employees. But, again, if we are then 
bringing someone forward as a potential employee, what is their 
openness to work with someone that may have some special needs 
or a mental illness or other barriers that make it possibly 
more difficult for them?
    It has to be collaboration. I hope that was strong in my 
message. It is not just one of any of us. It is all of us 
coming together and making sure we understand what each of us 
bring to the table.
    So, Chairman Smith, the first answer would be flexibility 
to be able to reach out to the proper services that will meet 
that individual's needs.
    Chairman SMITH OF NEBRASKA. Okay. Thank you.
    Ms. Kneebone, would you be able to reflect on this at all, 
given your insight?
    Ms. KNEEBONE. Just to echo what Ms. Slater said, with the 
flexibility being key, especially as you see some of the more 
effective models being ones that are able to bring multiple 
programs together, multiple partners to the table. That also 
often brings with it a big administrative burden, a lot of red 
tape, that puts a strain on the providers and takes resources 
from the actual mission.
    So I think the ability to allow for more experimentation 
and figure out how, with accountability, we can allow for more 
flexible strategies that work over different kinds of 
communities, that would be key.
    Chairman SMITH OF NEBRASKA. All right, and very well. Thank 
you.
    I now recognize our distinguished ranking member, Mr. 
Davis, for questions he might have.
    Mr. DAVIS. Thank you very much, Mr. Chairman.
    And I thank all of you who have come to share with us this 
morning.
    Each one of you talked about a lack of local resources for 
addressing some of the key challenges of poverty--skill-
building, supports like child care, health care, 
transportation, and housing.
    Could targeted Federal investment make a real difference in 
the kind of communities you have studied?
    Perhaps, Ms. Slater, I will start with you.
    Ms. SLATER. Yes, I believe so, because, again, the Federal 
support directs how it trickles down to the State and the 
region. So, again, it is back to the flexibility and really 
acknowledging the lack of services in some of the areas.
    Mr. DAVIS. Mr. Leavy.
    Mr. LEAVY. Danny, I think, for us, we have been through a 
lot of iterations of different job training programs. We even 
been around since CETA, practically, you know--Job Training 
Partnership Act, Welfare to Work Act, the American Recovery 
Act. But the point is that most of these programs don't really 
allow you to do the intensive kind of training we actually do.
    We may have to cobble together resources from a whole bunch 
of places to get enough money to get the basic skills 
remediation, to get the work maturity training and this very 
expensive occupational skills training, where our shop--you 
have been there. I mean, this is an expensive operation, but it 
gets people real skills, and people can really get quality jobs 
and get a foothold on the career ladder. It is an investment 
that is not being made and needs to be made.
    So, again, in the old days, the Job Training Partnership 
Act used to train tons of African American men in Chicago for 
jobs in the city. That was almost all wiped out when we went to 
a voucher-based system with WIA.
    So, again, we need to put some of the money in job training 
that we used to have during CETA days, and we used to make a 
real, real commitment to skills training and lifting people out 
of poverty. It can be done. I mean, we are a model. It can be 
done, and Linda and I do it. But we need much, much, much more 
consistent resource and commitment to comprehensive training 
and getting industry--I am talking too much. Okay, I will be 
quiet.
    Mr. DAVIS. Mr. Partridge.
    Mr. PARTRIDGE. Thank you. Thank you, Mr. Davis.
    I mean, I think the answer is yes, and I think they 
described it well.
    One of the things, though, I want to point out is, 
especially in rural communities but even in urban communities, 
there are these scattered programs and, you know, duplicate 
services and all sorts of issues. And so that was one of the 
reasons why in my testimony I discussed expanding regional, 
State, Federal development organizations, like the Appalachian 
Regional Commission. They exist on paper like in Ms. Sewell's 
district, but it doesn't have any--I don't think there are any 
resources.
    And so what they would do is, they have--like, the 
Appalachian Regional Commission only has a $100 million to $150 
million budget; however, they are fantastic at being the broker 
who leads the efforts that brings everything to the table to 
help with the collaboration that the previous two spoke about 
that is needed for this.
    So I think that would be one of the ways that a relatively 
small amount of money could have a lot of payoff.
    Mr. DAVIS. Thank you.
    Ms. Kneebone.
    Ms. KNEEBONE. I think that point really speaks to 
addressing the capacity issue, because targeted Federal 
investment absolutely could make a big difference in these 
places, especially if it embraces these more wholistic, 
crosscutting strategies that recognize the complexities that 
are facing poor people in poor communities.
    But if we want that funding to be able to reach into some 
of these communities we are talking about, in places where 
poverty has grown rapidly more recently, we have to overcome 
that capacity gap. And having these quarterback-type 
institutions that can play that role and more effectively 
marshal all those resources is a critical step.
    So any sort of funding, I think, should explicitly 
recognize and target resources to that type of backbone 
capacity-building and that sort of entity.
    Mr. DAVIS. Thank you.
    And quickly, Mr. Leavy, I have always been intrigued by 
your ability to work directly with local employers, where you 
know that you are training people for what they need. How did 
you accomplish that?
    Mr. LEAVY. Without going into a lot of history, I mean, we 
understood that race was a big variable. On the old west side 
of Chicago, where my dad worked--and he worked at a 
manufacturing company and he lived in the neighborhood, took 
the bus, blah, blah,
    blah. When that neighborhood changed to African American, 
those local companies had extreme difficulty in absorbing and 
training the local workforce, and we can see it 20 years later.
    So we went to partner with the Industrial Council of 
Nearwest Chicago, and these are our local employers. Let's work 
together, let's create a program that is going to open the 
doors for our community residents, brown and black, and is 
going to get you the workers you need. And we actually sat down 
and planned the bloody thing with our neighborhood small 
businesses in woodworking and shipping and receiving with the 
help of the Industrial Council.
    The key to that was the employers have some sense of 
ownership and involvement. And employers got to meet our 
community people during training. They got to see their 
dedication. They got to see the quality of our people. And 
racial stereotypes were overcome, attitudes for ex-offenders 
were overcome.
    And they were setting the standards for training, so they 
owned it. It is way more than just, you know, I have a company 
that I am going to take a job order from and steal. No. These 
guys are involved and they own the program design and they 
owned its success. And you probably heard from them. We got our 
funding cut, and these employers, they went to the mat for us. 
So they own this thing.
    And they are 99 percent white small-business owners from 
the industrial corridor. And it is great when our participants 
go on a field trip, a tour to a local company; they go in and 
look at whatever the company is, and they see, oh, there is my 
neighbor working. So they get the confidence that these guys 
are giving our people, black people, a fair shake and some 
opportunity. And, conversely, the small-business owner sees the 
hard work, the diligence of our trainees.
    And, of course, the credibility of our staff and the 
training institution itself kind of brings the community and 
business together. These guys have been doing this for 25 
years, and----
    Chairman SMITH OF NEBRASKA. Great.
    Mr. LEAVY [continuing]. They have got quite a reputation in 
the employer community.
    Chairman SMITH OF NEBRASKA. Very good. Thank you. Thank you 
for your answers there.
    Now we will go to Mr. Smith of Missouri.
    Mr. SMITH OF MISSOURI. Thank you, Chairman Smith. It is an 
honor to serve on your committee. And I like the ring of 
``Chairman Smith,'' by the way.
    I want to thank the panel for being here today. In fact, 
these issues are extremely important. I have spoken with the 
chairman and the members of this committee of my personal 
background and interest in poverty. I grew up in a very 
working-class family. And I represent an area in southeast, 
south-central Missouri which is part of the Mississippi Delta, 
and we have some very interesting dynamics of our own that we 
deal with.
    It is the largest congressional district in the State of 
Missouri, just under 30 counties. It is roughly 20,000 square 
miles, so it is very rural. Our largest populated community is 
a town of 38,000 people, Cape Girardeau, Missouri.
    And I want to give you some interesting statistics about 
our congressional district. According to the Economic 
Innovation Group, I represent the 14th most economically 
distressed congressional district in the country, out of 436--
14 out of 436, which is absolutely not good. It is also one of 
the most conservative congressional districts in the country.
    The Economic Innovation Group report on distressed 
communities estimates that 49 percent of adults in my district 
are not in the labor force, and the poverty rate is 20 percent. 
These numbers are not much different than the city of St. 
Louis. In St. Louis, 42 percent of adults are not in the labor 
force, and the poverty rate stands around 22 percent. So we 
have more people out of the workforce in our district than the 
city of St. Louis.
    And that is much different, though--Ms. Kneebone, according 
to your testimony, I think these are interesting facts for the 
State of Missouri. The picture is really different in the 
suburbs of St. Louis. Just 6 miles from the city of St. Louis, 
it is 36 percent adults who aren't working, and the poverty 
rate is only 6 percent. The city of St. Louis, the poverty rate 
is 22 percent. In my rural congressional district, it is 20 
percent.
    All that, in my opinion, says that rural southeast and 
south-central Missouri experiences poverty in similar numbers 
to the city of St. Louis, and both are far worse than the 
suburbs of St. Louis, which the poverty rate is 6 percent.
    We know that employment is the single largest determining 
indicator of poverty, but we continued to see factories close 
for the last several years. In many cases, we see our good-
paying factory jobs go overseas because of economic hardships 
and burdensome regulations. These factories can't keep their 
doors open, and that means that we are losing good jobs.
    We had one employer in Butler County, Missouri, in my first 
year in office that cited that the reason that they were 
shutting down their doors and eliminating roughly 500 jobs was 
because of unnecessary and burdensome regulations that they 
couldn't comply with and was moving to Mexico. This is a real 
problem and something that has to be changed.
    When nearly half of adults in my district aren't working 
and are out of the labor force entirely, our communities are 
deeply in trouble.
    Mr. Partridge, with many rural areas declining in 
population, who is staying behind? Are these areas becoming 
wealthier as those who remain have good jobs and choose to 
stay, or are they becoming poorer as those without means are 
unable to leave?
    Mr. PARTRIDGE. Thank you, Mr. Smith.
    I think the answer to that question is it depends. Because 
if we are talking about a rural district--very, very, very 
rural districts where people left, what is left behind is often 
relatively wealthy farmers that are very big. So, in that 
sense--then you have other districts where you have brain 
drain, where the talented people leave, and that leaves behind 
a workforce that is less educated and it is just going to be 
less dynamic. There is going to be less business formation and 
so forth.
    So it really depends on the setting. There is just a lot of 
diversity.
    Mr. SMITH OF MISSOURI. So just a lot of barometers and 
issues.
    You have been doing a lot to improve the economies of rural 
areas. Could you give us some examples of what maybe you have 
done for people in their 30s and 40s to help grow the economy 
in rural areas?
    Mr. PARTRIDGE. Well, what I have done is I have tried to 
point out that when people--especially in the last 15 years, 
there has been a lot of emphasis on attracting young people 
with really cool downtowns and so forth, and rural communities 
can't compete on that. They are just not going to do very well 
on that basis.
    However, they can compete on being family-friendly and 
having a really nice environment and lifestyle for certain 
people. So, in that sense, people in their 30s and 40s are no 
longer looking for cool bars; they are looking for a place to 
send their kids and be safe. That is where rural communities 
can thrive.
    Mr. SMITH OF MISSOURI. Thank you, Mr. Chairman.
    Chairman SMITH OF NEBRASKA. Thank you.
    And next we have--yes, Ms. Sewell. Sorry. Go ahead.
    Ms. SEWELL. Thank you, Mr. Chairman.
    And thank you, panelists. This is the first subcommittee 
hearing as a new member of Ways and Means that I get to 
participate in. And I have to tell you that I am very excited, 
Chairman Smith and Ranking Member Davis, about the opportunity 
to be on this subcommittee.
    My district is the Seventh Congressional District of 
Alabama. I grew up in this district. It is a district that 
includes the city of Birmingham, which is the largest city in 
the State of Alabama, but it also includes Selma, Alabama, 
which is my hometown, and many rural communities around Selma. 
The median income for a family of four in my district is 
$34,000, and 22 percent of the families in my district live in 
poverty.
    It is affectionately called the Black Belt of Alabama 
because of the very rich soil. That used to be very agrarian 
and agricultural. It is where a lot of the Cotton Belt of 
Alabama, back in the day, used to exist. Now it is filled with 
a lot of rural communities that are struggling.
    I often say that what we lack in the Seventh Congressional 
District in terms of economic prosperity we more than make up 
for in heart, in fight, in spirit. What we need are better 
opportunities, more resources, a hand up, not a handout.
    Having said that, I was very intrigued by what you were 
talking about, Mr. Partridge, in terms of regional 
collaboration. The Appalachian Regional Commission, which you 
cited, has done some great work across the 13 States that it 
encompasses, with relatively limited resources when you think 
about the fact that they have to deal with 13 States.
    In fact, my district doesn't get a lot of resources from 
the ARC. Many of the collaborative regional resources that we 
receive come from the Delta Regional Authority, which has a 
very limited budget. It is one-tenth of what ARC is. Yet it is 
literally the lifeline for so many of the communities I 
represent.
    Can you talk a little bit about the regional collaboration 
and what we can do as lawmakers that are not in the position of 
providing appropriating dollars but, rather, authorization of 
different social net programs that can be effective in reaching 
communities like so many of us represent?
    Mr. PARTRIDGE. Thank you, Ms. Sewell. I think you really 
described a lot of the issues well.
    So when you get down into central southern rural Alabama, 
you have a lot of counties. They lack resources. There are many 
disparate Federal--you know, Economic Development 
Administration, USDA Rural Development, Department of Labor 
workforce training, and so on--all these disparate groups. And 
these counties just lack things like even an economic 
development coordinator or one without a lot of training who 
knows how to write these very complex grants.
    And so that is one of the key things that ARC has done, is 
it is a Federal-State, so it is flexible, it isn't one-size-
fits-all, but they are really kind of a leader. And they have, 
like, how to do grant-writing, to bringing all these disparate 
counties together to work collaboratively, because if you get 
jobs in one county, people commute and take them, it helps the 
whole region.
    So, in that sense, what I view these organizations as doing 
is they are the broker. They are the ones who can bring 
everybody to the table with relatively modest resources.
    Ms. SEWELL. What do you suggest we would do on the 
authorization side when it comes to workforce development?
    I would like to get you, Mr. Leavy, involved as well. You 
know, one of my passions is workforce development, because here 
is what I know for a fact. So many of the folks that I 
represent want better opportunities. They want jobs. The 
problem is finding those jobs. In rural America, a lot of those 
manufacturing opportunities have really dried up. And so, when 
you finally do get an opportunity, people haven't worked in 
those manufacturing jobs for generations.
    My biggest example is Wilcox County, which is the poorest 
county in the State of Alabama. It is in my district. And we 
got--I am the only Democrat in Alabama, but I have very good 
working relationships with my Republican colleagues. And we 
were able to convince the Governor to give us a $150 million 
manufacturing opportunity in the poorest part of my district. 
It is a copper manufacturing facility. Here is the problem: We 
are now busing in people from other communities, Tuscaloosa, to 
come and take these jobs, because we have had generations of 
people who haven't had an opportunity to work.
    Now, given this great opportunity, how do we bring folks up 
to speed when it comes to workforce development?
    Mr. LEAVY. Okay. I will take a shot at that.
    What happens is, when people are out of the workforce for a 
long time, they don't trust the employers, they don't trust the 
system, they are kind of hanging back, they are not willing to 
make the effort, because they are afraid to fail. So you have 
to get them started in baby steps, and you have to have 
institutions that can engage them credibly.
    And if they are engaged and if they believe in the training 
institutions and they start putting forth the effort, then you 
can see these folks can learn just like anybody else can learn.
    Okay. So it is a--we call it work ethics, okay? And we 
train for it on the shop floor every day. I mean, Linda's shop 
is a workplace, and you have to come on time, and you have to 
respect your fellow workers, and you have to follow the boss's 
instruction. So you get work ethics training every day on the 
job. And that is an essential part of getting people to 
understand that this can work for them, okay, and getting used 
to the workplace disciplines.
    So you have the workplace disciplines; you have basic 
skills remediation. And then people say, oh, hey, if you pass 
this, if you do that, you are going to get to run that machine, 
you are going to drive that forklift. People can see progress, 
okay? And these folks can learn it. They need to get motivated 
and believe it is possible for them.
    Ms. SEWELL. Chairman Smith, thank you so much for allowing 
him to answer that question.
    I think it just goes to the need that we can try to explore 
in this committee, workforce development strategies that will 
work across the board for people dealing with poverty issues in 
suburbia, in urban, and in rural.
    Thank you, sir.
    Chairman SMITH. Right. That is absolutely--and, certainly, 
for the answers to the questions, that is very relevant.
    Mrs. Walorski?
    Mrs. WALORSKI. Thank you, Mr. Chairman. And, again, thank 
you for holding this important hearing. I am absolutely 
passionate about this issue.
    And I am so glad each of you are here. My district is 
northern Indiana, and so we are 2 hours from Chicago and have, 
in the past, on some other committees I have been on, looked at 
best practices and places and things that are happening in 
Chicago that really are, I think, a standard right now of where 
we are looking.
    I want to give a shout-out to our Goodwill in Indiana, the 
Goodwill Industries, and what they have done in our district, 
our State, as they have been able to, you know, hone in on this 
issue of collaboration, which I want to come back to, Ms. 
Slater, in a second and talk about that.
    I think it is incredible that all of your research, all of 
your findings, and other experts that we have had speak to 
Congress over the last couple of years--it is so apparent to me 
that all the work that we are doing--when we look at 
traditional approaches from government, which has been increase 
funding, increase funding, increase funding, and when you start 
looking at the numbers of people in poverty, where they are 
coming from, where they are moving from, it just becomes so 
important, in my mind, to do the kinds of things you are 
talking about, which is connecting people to this equation.
    It still takes people on the front lines to coordinate. It 
takes people on the front lines to be able to honor human 
dignity and to make sure that we are looking at all the seeds 
of the problem and we are actually doing something to make sure 
that there is an economic ladder out of poverty in this 
country, the greatest country on the face of the Earth.
    And I am so convinced that the solutions to our very 
problems are right here within the kinds of research that you 
have all done and the kind of things that you have moved along, 
that we are moving the dignity of people along as well, that, 
you know, we are equipping a nation. We are doing it, using 
each other in collaboration.
    And I think, Ms. Slater, to your point, my district is very 
much a case study like what you are talking about in Nebraska. 
I am 2 hours from Chicago. We are urban; we are rural. We have 
all the same kind of makeup that, you know, a lot of these 
small rural areas are.
    I am terrified that if we don't come together and fix this 
in a bipartisan way that rural America will not recover and 
that we are going to be groping for bigger issues later if we 
don't come together and solve this now.
    But I am so convinced about this issue of collaboration. 
And I am working on a bill right now as we approach TANF.
    Can you just talk about some of the best practices that you 
have used in your community to collaborate on the front line 
and why that is going to be important as we look at, you know, 
tangible assistance to needy families in the real quick future 
here?
    Ms. SLATER. Sure. Thank you very much.
    Truly, the thing that comes to mind that you just 
summarized is it is about people. It is about people working 
together that are there to actually serve the people we are 
seeing every day.
    And so, truly, it becomes--and I think it is one of the 
advantages, maybe, of the rural community, is we know each 
other. It is asking for help. It is actually acknowledging what 
your core is and what cores come from other agencies.
    The other thing that I think is a plus in the rural 
community, but not unique, is the fact that if there is an 
individual with a barrier in a small community, everybody in 
town knows that. They talk about it. They know Tammy at 
Goodwill, and they will call and see if we can be of 
assistance.
    But it is really about the whole relationship and trying 
not to make it the competition that sometimes it becomes but 
what are we really good at. And that is one of our best 
practices, is we have a lot of diverse programs, but at the end 
of the day, what are we the best at. So if something else comes 
along, we have learned to say ``no'' and to extend a hand and 
offer something that we may know about to someone else.
    Mrs. WALORSKI. That is incredible.
    Ms. SLATER. Because you cannot be good at everything.
    Mrs. WALORSKI. Absolutely. And that is a great point.
    I just have a question for all of you in this last minute 
here. One of the things in my community that is a plus, both on 
the rural and the urban side, is the benevolence of my 
community and the private dollars in regional coordination that 
are beginning to flow into our own community from our own 
people--private dollars, community foundations that are really 
understanding this.
    I guess, Mr. Partridge, let me just address that to you; it 
is your research. Do you see that emerging now in this country, 
where we are looking at partnerships, even financially, so it 
is not just a one look at a government but we are looking at 
resources inside our communities as well?
    Mr. PARTRIDGE. I think you exactly described it right, in 
the sense that, you know, a lot of this has been promoted--you 
know, attempts for collaboration have been promoted by just 
things haven't been working. And a lot of it is that problems 
are a lot bigger than what one community can handle.
    However, at the community level, as you suggested, I mean, 
the best way is to--every community has great resources. They 
have entrepreneurship that is untapped. They have human 
resources that is untapped. And as I noted in my testimony, you 
know, just the multiplier effects of new jobs created, 
spillovers from small-business creation and local 
entrepreneurship are just rather remarkable.
    And so, in that sense, building from within is, I think, 
the best strategy, and the kind of collaboration you are 
talking about is the way to go.
    Mrs. WALORSKI. Thank you.
    And thank you, Mr. Chairman, for your indulgence. Chairman 
SMITH. Thank you.
    And next we have Mr. Reichert.
    Mr. REICHERT. Thank you, Mr. Chairman.
    Thank you all for the hard work that you do. And it sort of 
seems removed just a little bit, as we are in this formal 
setting, from the reality of the topic that we are discussing, 
doesn't it? I always sort of get overwhelmed by that thought.
    But I was thinking back to one of the first hearings that I 
had when I was chairman and working with Mr. Davis as the 
ranking member, and I shared my story. There are a lot of 
stories here, and you have a lot of stories, a lot of stories 
out there in the audience today, too, listening. And as I 
shared my story, after the hearing Mr. Davis said to me, ``You 
know, you and I could have grown up in the same neighborhood.'' 
And sometimes we forget that we all come from different places, 
we all come from areas in our life where we struggle.
    And Sandra Collins was one of those people from the 
Goodwill Industries organization in the Seattle area. She 
testified not too long ago when I was the chairman of this 
subcommittee. What a success story for Sandra. Sandra was 
homeless. She had two teenage daughters and was addicted to 
meth. She had a criminal background. She had no high school 
diploma, did not have a driver's license when she first 
connected with the Goodwill.
    But, as she was giving her testimony, she got news that she 
was just about to be promoted to supervisor. So Sandra is still 
working at the Goodwill in the Seattle area and is now the 
manager. So we are proud of her and proud of the work that 
Goodwill Industries does all across the country, and we need 
every one of your efforts.
    So Ms. Sewell was concerned about people coming in to 
populated areas and taking jobs, and I am concerned about some 
of the rural areas having the opportunity to come into those 
areas and get jobs. But we have to balance that, I know.
    And I wanted to ask Mr. Partridge, are there any programs 
that--you know, because sometimes people have to make those 
decisions to relocate to find a job. What are we looking at as 
far as programs to help people relocate, not necessarily to 
take all the jobs but to participate in the workforce?
    Mr. PARTRIDGE. Well, thank you for the question, Mr. 
Reichert.
    I think you really hit upon--one really important issue is 
that, in the past, the key way that Americans did economic 
opportunity, reached it, was by migration. We were probably the 
most mobile society in the world for generations. And in the 
last generation, that has really changed. Young Americans are 
much less mobile than before.
    So one of the ways that poverty can be reduced is taking 
people from places that there are a lack of opportunities and 
moving them to places where there are opportunities. And one of 
the problems is they are relatively poor, they lack resources 
for that. They don't have a network, you know, to find a job. 
Their skills might have been okay for where they are at, but 
they are not necessarily good in an urban environment.
    So I would encourage efforts to, at least on a pilot basis, 
to try to look at helping migration of workers to where there 
are more opportunities. However, it is just a little bit more 
complex than saying, ``Here is some money, go move,'' because 
of these other issues about the lack of job networks and the 
lack of training for the kind of jobs that would exist in urban 
areas.
    Mr. REICHERT. Great. Thank you.
    Mr. Leavy, I wanted to touch on one of your comments as you 
rolled off the statics about unemployment between Black men, 
Hispanics, and Caucasians. And I was reading your statement, 
and you used the word ``controversial'' in your comments, but 
it is not used in your statement. And I don't see anything 
controversial about it. I just wanted to point that out. 
Because people are people, in my opinion, and we are here to 
help.
    So let me just further state very quickly that I think it 
is sad that the 50-percent dropout rate--I mean, that is just 
an unacceptable number, and I think that is one of the things 
we have to address.
    I am an old cop, 33 years on the streets in King County. I 
worked with people on the street in drug addiction, alcohol, 
homeless, all the time. One of the things we need to do--and I 
am very high on prevention. What do we need to do to get these 
young people to graduate so they don't start already behind the 
curve?
    Mr. LEAVY. Well, we have actually--we started an 
alternative high school for dropouts in Chicago because the 
dropout rates were so severe----
    Mr. REICHERT. But it is still 50 percent. We need to do a 
lot more.
    Mr. LEAVY. They have been--it has been--it has been--I use 
the term, schools had and are still reporting, neighborhood 
schools had and are still reporting the dropout rate in Chicago 
has improved a little bit. Okay? I will give you that. And 
there has been a lot of intervention on dropouts and special 
programs for dropouts, some of which reasonably work in the 
city.
    So we are a lot better on the dropout front than we were 10 
years ago. And we did a lot of research on that and got some 
bills passed with Senator del Valle at the State level to deal 
with the re-enrollment of dropouts. So there is a commission in 
Illinois for the re-enrollment of dropouts, and we got the 
issue in the public attention, and so we have made some serious 
progress.
    There are still tons of at-risk kids. And we run an 
alternative school in the heart of the west side, and our kids 
are pretty alienated sometimes and pretty tough. And putting 
together, again, the programs that can engage them and 
discipline them and challenge them is a hell of a lot----
    Mr. REICHERT. I would like to engage further with him at a 
later time, Mr. Chairman. My time has expired. I yield back.
    Chairman SMITH. Thank you.
    Ms. Chu.
    Ms. CHU. Thank you, Chairman Smith.
    I represent a very urban/suburban district in Los Angeles 
County, which has 10 million people. And, Mr. Leavy, the work 
that you do is in an area that is very similar to this.
    In L.A. County, we have a very, very large homeless 
population. In fact, the most recent count revealed that there 
are approximately 43,000 homeless individuals living in 
shelters or in the streets.
    Now, you have done a lot of work with similar urban/
suburban populations in Chicago. How could Federal antipoverty 
programs best assist homeless populations in places like L.A. 
County and Chicago?
    Mr. LEAVY. I am trying to get Linda to talk. She is the 
expert in--she provides all the intensive support services to 
the very high-need folks. And we have, what did we say, 22 
percent homeless and near-homeless in the training program.
    So tell them a little bit about the transitional work and 
how it helps the homeless.
    Ms. THOMAS. So we, through our city dollars, have come 
across what we call transitional jobs training funding, where 
we can work with our clients to provide additional services. We 
try to help our customers become self-sufficient and to be able 
to attend training without worry.
    And so we are able to create jobs within the program and 
give them a weekly stipend to support them with their needs. We 
are able to address their ability to secure housing and their 
ability to get to training and their ability to have clothing 
and doctors appointments so that they will have a positive 
outcome through our transitional jobs training funding.
    Ms. CHU. So, for this homeless population, what elements of 
what you have talked about are the most important? For 
instance, how important is accessibility to quality housing?
    Ms. THOMAS. For the homeless population, if I don't have 
secure housing, I will not do well in the job. Before I can 
take on employment, I have to make sure I have secure housing, 
I have to make sure that I have transportation to get to that 
job every day.
    So, when they are in the training program, we are going to 
immediately on day one start to look at those resources that 
are out there to make sure this person will have secure 
housing. Because we have a lot of people, they are homeless 
with a roof, so they are going to a cousin's house today, they 
are staying with a friend tomorrow.
    And so we are going to work with an agency that is going to 
help them move into housing where it is secure, so when I start 
my new job, I can go to work not worrying about where am I 
going to live tomorrow or will I get back to the shelter in 
time to get a bed.
    So those are the ways that we work strongly to help out 
with the homelessness, for housing.
    Ms. CHU. Yeah.
    And, in fact, to follow up, in L.A. County, we have higher-
income neighborhoods located right next to low-income and poor 
neighborhoods. And, in fact, poverty is found in pockets and 
separated, oftentimes, just simply by a neighborhood.
    So how did we get into this situation, and how can we 
reduce this inequality between the neighborhoods that are 
located right next to each other?
    Mr. LEAVY. Wow. You know, Danny knows, you know, you have 
the west side, Austin, and then you have Oak Park, and you have 
a serious dividing line. Oak Park is a pretty liberal, 
progressive place. They have PADS programs, and they try to 
keep themselves accessible to the low-income folks in the city. 
And, you know, I am not sure how you integrate across those 
barriers. It is a voluntary thing in Oak Park. I live in Oak 
Park, and they are just very progressive folks out there.
    In terms of your question, you know, how do you create 
cooperation across community boundaries, neighborhood 
boundaries, I mean, Chicago is extremely racially segregated. 
And you have neighborhoods on the south and west side that, you 
know, folks on the north side will not go in. And you have 
pockets of wealth and affluence on the north side.
    And you need community development--most of our development 
resources traditionally are--I talk about in my longer thing. 
You talk about triage. You are putting resources for those most 
likely to succeed. You are not making the investments in the 
high-risk areas, in the high-poverty areas where you have 
multigenerational poverty. I mean, everybody wants to pick a 
winner, and everybody is afraid to waste money on what might be 
a loser.
    And, again, this is an attitude that, you know, we see in 
job training, we see in education, we see across the board--we 
see in housing and urban development sometimes. So this triage 
attitude is something that we really have to get our head 
around and fight against.
    What is happening in our training program--because the 
labor markets are improving and some people are moving ahead 
and some people are getting jobs, but those left behind are 
really desperate, are really sinking. Okay? That is the 
problem. We are separating more.
    You talk about income inequality. We talk about it, you 
know, on the cosmic scale when Bill Gates and those guys have 
all the money, but it also happens in our communities. We are 
segregating the rich and the poor even more, and we need to 
figure out how to fix that. Clearly, jobs are part of that, and 
people investing in jobs for low-income people is clearly a 
part of that solution. But, again, I think there are more 
economic development issues involved here than I am prepared to 
mouth off about right now.
    Ms. CHU. Thank you.
    Chairman SMITH. Right. Thank you.
    Mr. Rice.
    Mr. RICE. Thank you, Mr. Chairman.
    Interesting hearing. It seems to me that the way you deal 
with poverty is you have to do what you can to make sure people 
have opportunity on the one hand, and then on the other hand 
you have to do what you can to make sure they take advantage of 
that opportunity. And it seems like, mostly, today, we are 
talking about the second part of that equation, trying to get 
people to take advantage of opportunities that they have.
    My district, I got seven counties in South Carolina. I have 
Myrtle Beach, a big popular tourist destination, and employment 
rates are pretty low there. But if you go inland, I have 3 of 
the top 10 poorest counties in the State. They were very 
agrarian and textiles, tobacco and textiles. So you can guess 
what has happened to them in the last 40 years, right? 
Agriculture doesn't employ as many people, and certainly not 
tobacco. Tobacco is a fraction of what it used to be. And 
textiles, those jobs are all gone. There are a lot of empty 
factories in Marion County, South Carolina.
    So, on the one hand, you know, the first part of the 
equation, trying to do what you can to make sure people have 
opportunity--and we haven't talked much about that today. But 
things like tax reform, regulatory reform that Jason Smith was 
talking about earlier is so important and a lot of the reasons 
why a lot of these companies that used to be in Marion County 
have left. And I put that on Washington, D.C.
    And that is why I am so very happy that this committee is 
now working on tax reform and the House is working on 
regulatory reform, because I think the first part of that 
equation--I mean, you can train people all you want to, but if 
there are no jobs available when they get out, it doesn't help 
very much, does it, Mr. Leavy? So, I mean, you have to get 
them----
    Mr. LEAVY. Believe it or not, a trained workforce can be an 
incentive for a company to come into an area----
    Mr. RICE. That is true. That is another part of it.
    You know, there is a program in the Florence-Darlington 
Technical College; they have a program for computerized digital 
machining. And they can take 80 kids a year, and it is a 2-year 
program. And they have two problems: One, they can't get 50 
kids a year to sign up for it; and, two, if they do get them to 
sign up for it, most of them don't finish. They get through 1 
year. Well, the reason they don't finish is because the 
companies are so hungry for these kids that they hire them 
before they finish their program. So, in other words, we have 
this opportunity, but we can't get people to take advantage of 
the opportunity.
    And I believe most people would rather work than be on 
government programs. I think if you rely on the government to 
provide for your livelihood, you will always live in poverty. I 
think the government is incapable of providing for you. But we 
have 80 different means-tested government programs, many of 
which are designed to help people to move to work, to move to 
take care of--and they are not working for a large number of 
people.
    There are still significant numbers of people who would 
rather be on government programs than actually go out and take 
that computerized digital machining class and go to work and 
make $60,000 a year.
    How do you fix that, Mr. Leavy?
    Mr. LEAVY. Well, I mean, we deal with it every day. 
Opportunity plus effort equals success, okay? People have to 
make the effort to take advantage of the opportunities 
presented to them. And do they see and believe and is the 
opportunity real for them? Their perceptions are a lot. And I 
live in this every day.
    In Linda's programs, she is able to get and engage and 
discipline her people, and the people are enthusiastic, and she 
has credibility and trust, and the people march through the 
program and they go out in the labor market and they do well. 
Okay. And my high school used to be that way, but it is not so 
much anymore. In our high school, West Side Academy, we are 
having an issue of student engagement and motivation----
    Mr. RICE. Okay. I need you to wind down, because I want to 
ask somebody else too.
    Mr. LEAVY. What?
    Mr. RICE. I want to ask somebody else too, so wind up, if 
you can.
    Mr. LEAVY. I will tell you about the West Side Academy some 
other day. But, you know, it is a question of credibility and 
trust, and are they perceiving this thing as really working, 
are they believing in it. And if they believe in the leadership 
of that school, that school can discipline them, can draw them 
out, can challenge them. Okay? And they will see it as a 
benefit to them in their lives. They have to have credibility 
with those kids, and you can get them to do what they need to 
do.
    Mr. RICE. Mr. Partridge, how do you get them to take 
advantage of the opportunity?
    Mr. PARTRIDGE. Thank you.
    One of the things that I have always thought about poverty 
is that not only do we have to train workers in places where 
there is a lot of high poverty, there has to be also the 
opportunity so the person has the incentive to go for 2 years 
through a training program so they can get a job. And so, in 
that sense, it is a chicken/egg problem that, you know, there 
have to be jobs to have incentives for people to get the 
training so they could actually get a job. So you are 
absolutely right. It is a chicken/egg issue.
    And one of the things that you raised is the general 
macroeconomic environment has not been very favorable for the 
lower half of the income distribution. And, you know, any 
efforts there--manufacturing was an old mainstay for that 
group. And any efforts there to build up that part of the 
economy, I think, would have very large positive effects.
    Mr. RICE. Thank you, Mr. Chairman.
    Chairman SMITH. Thank you, Mr. Rice.
    Mr. Curbelo.
    Mr. CURBELO. Mr. Chairman, thank you very much for holding 
this hearing.
    I think you always hear politicians talk about the middle 
class, and, indeed, the middle class is important. It is the 
engine of the American economy. But that is also where most of 
the votes happen to be. In poor communities, there aren't as 
many votes. Yet we are here because you care about this issue, 
Mr. Chairman, we care about this issue, and certainly our 
witnesses do.
    So I thank you all for coming.
    Ms. Kneebone, I want to talk to you about suburban poverty. 
I represent a largely suburban district. And you discussed the 
migration of poverty from the urban cores out into the suburbs, 
and of course this is a major concern for me.
    I think one of the aggravators or the factors that 
contribute to this phenomenon is the lack of transportation out 
in the suburbs. Most urban cores have fairly sophisticated 
public transportation grids, but as low-income individuals move 
from the urban cores out to the suburbs, does that lack of 
access to public transportation aggravate their circumstances?
    Ms. KNEEBONE. That is a real challenge for suburban 
communities across the country, particularly for the poor 
residents, because as both jobs have shifted away from downtown 
and poverty has grown more in suburbs, those aren't often 
happening in the same places. So the distance between where 
jobs are located and where poor people can afford to live has 
grown. And we have seen the number of nearby jobs for poor 
residents fall across the country in urban, suburban, and rural 
communities.
    So the fact that suburbs often don't have public transit 
systems or, when they do, they are not connected suburb to 
suburb where a lot of these job opportunities are growing does 
exacerbate that mismatch. It makes it much harder to connect to 
those employment opportunities that can give them a path out of 
poverty and also makes it more incumbent on them to own a car 
and have to deal with the high costs of maintaining a reliable 
car that would actually be able to get them to where the job 
opportunities are.
    Mr. CURBELO. So, given that infrastructure investment is a 
priority for the new administration and for many of us here in 
Congress, you think there is an opportunity to use some of that 
poverty data to more effectively make these investments.
    Ms. KNEEBONE. Yes, absolutely, both in terms of how we 
think about where to make transportation investments, in terms 
of roads versus transit options, you know, where those dollars 
go, how they are deployed, but also in terms of thinking about 
where housing is around those networks, where we can take 
advantage of density around those transit hubs to increase 
access to opportunity both through affordable housing and 
through transportation.
    Mr. CURBELO. Thank you.
    Dr. Partridge, I should get you on the record about the 
great theft of 2003, when The Ohio State University robbed the 
University of Miami of a college football championship.
    By the way, Mr. Chairman, the year before, we defeated 
Nebraska in Pasadena. But let's set that aside, because there 
is very little time.
    I do want to ask you about education. And we have built 
this idea in our society that every young person has to go get 
a 4-year degree at a traditional university like The Ohio State 
University, like the University of Miami. And, in many ways, 
our Tax Code supports that idea.
    Do you think that the lack of an acknowledgement of the 
diverse paths that there are to success, to getting educated, 
to acquiring the skills needed to obtain a quality job, that 
the lack of recognition is aggravating poverty in a lot of 
communities?
    Mr. PARTRIDGE. Thank you for the question.
    In some cases, yes, that there is a segment of the high 
school population that just is unaware of the opportunities. 
And you are right, many high school curriculums look like a 
pre-college training program, and so there are fewer of those 
opportunities.
    I think, you know, besides curriculum reform and providing 
better information to students--that is one of the things that 
the economists found. If you give the students information, 
they will make better decisions. Besides that, one of the areas 
I think is just fantastic in terms of investment and in terms 
of the role they play in communities and broader communities is 
community colleges and technical colleges. They are on the 
ground doing the workforce training, but, even beyond that, 
they have more of a regional footprint that brings people 
together in a collaborative process.
    So, in that sense, investment in technical colleges and 
community colleges would have a large payoff for the population 
that we are talking about.
    Mr. CURBELO. Okay. Thank you very much.
    I will yield back the balance of my time.
    Chairman SMITH. Thank you.
    Again, thank you to all of our members here today and 
certainly to our witnesses. Your expertise is valuable, and we 
could probably extend this for a few more hours just in 
discussion. With that being said, though, you will have the 
opportunity to extend your remarks for the record. The record 
will be held open for 2 weeks. And so, if you wish to respond 
in more depth to some of these questions, you will have the 
opportunity to do so.
    And, with that, I say thanks again, and the committee 
stands adjourned.
    [Whereupon, at 11:36 a.m., the subcommittee was adjourned.]
    [Questions for the Record follows:]
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