[House Report 104-875]
[From the U.S. Government Publishing Office]



                                                 Union Calendar No. 478
104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     104-875
_______________________________________________________________________


 
 REPORT OF THE ACTIVITIES OF THE COMMITTEE ON ECONOMIC AND EDUCATIONAL 
                OPPORTUNITIES DURING THE 104TH CONGRESS

                                _______





January 2, 1997.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed


          COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES

    One Hundred Fourth Congress
                                 ------                                
     WILLIAM (BILL) GOODLING, 
      Pennsylvania, Chairman
WILLIAM L. CLAY, Missouri            THOMAS E. PETRI, Wisconsin
GEORGE MILLER, California            MARGE ROUKEMA, New Jersey
DALE E. KILDEE, Michigan             STEVE GUNDERSON, Wisconsin
PAT WILLIAMS, Montana                HARRIS W. FAWELL, Illinois
MATTHEW G. MARTINEZ, California      CASS BALLENGER, North Carolina
MAJOR R. OWENS, New York             BILL BARRETT, Nebraska
THOMAS C. SAWYER, Ohio               RANDY ``DUKE'' CUNNINGHAM, 
                                     California
DONALD M. PAYNE, New Jersey          PETER HOEKSTRA, Michigan
PATSY T. MINK, Hawaii                HOWARD P. ``BUCK'' McKEON, 
                                     California
ROBERT E. ANDREWS, New Jersey        MICHAEL N. CASTLE, Delaware
JACK REED, Rhode Island              JAN MEYERS, Kansas
TIM ROEMER, Indiana                  SAM JOHNSON, Texas
ELIOT L. ENGEL, New York \3\         JAMES M. TALENT, Missouri
XAVIER BECERRA, California           JAMES C. GREENWOOD, Pennsylvania
ROBERT C. SCOTT, Virginia            Y. TIM HUTCHINSON, Arkansas
GENE GREEN, Texas                    JOE KNOLLENBERG, Michigan
LYNN C. WOOLSEY, California          FRANK RIGGS, California
CARLOS A. ROMERO-BARCELO, Puerto     LINDSEY O. GRAHAM, South Carolina
  Rico                               DAVE WELDON, Florida
MEL REYNOLDS, Illinois \1\           DAVID FUNDERBURK, North Carolina
CHAKA FATTAH, Pennsylvania \2\       MARK E. SOUDER, Indiana
EARL BLUMENAUER, Oregon \4\          DAVID M. McINTOSH, Indiana
                                     CHARLES NORWOOD, Georgia

----------
\1\ Resigned October 1, 1995.
\2\ Appointed October 11, 1995.
\3\ Resigned April 22, 1996.
\4\ Appointed June 5, 1996.


                         STANDING SUBCOMMITTEES

                                 ------                                

              Subcommittee on Employer-Employee Relations

   HARRIS W. FAWELL, Illinois, 
             Chairman
MATTHEW G. MARTINEZ, California      THOMAS E. PETRI, Wisconsin
DALE E. KILDEE, Michigan             MARGE ROUKEMA, New Jersey
PAT WILLIAMS, Montana \4\            JAMES M. TALENT, Missouri
MAJOR R. OWENS, New York             JAN MEYERS, Kansas
THOMAS C. SAWYER, Ohio               JOE KNOLLENBERG, Michigan
DONALD M. PAYNE, New Jersey          DAVE WELDON, Florida
MEL REYNOLDS, Illinois \1\           LINDSEY O. GRAHAM, South Carolina
CHAKA FATTAH, Pennsylvania \5\
                                 ------                                

                 Subcommittee on Workforce Protections

 CASS BALLENGER, North Carolina, 
             Chairman
MAJOR R. OWENS, New York             Y. TIM HUTCHINSON, Arkansas
GEORGE MILLER, California            LINDSEY O. GRAHAM, South Carolina
MATTHEW MARTINEZ, California \4\     DAVID FUNDERBURK, North Carolina
PATSY T. MINK, Hawaii                CHARLIE NORWOOD, Georgia
ROBERT E. ANDREWS, New Jersey        HARRIS W. FAWELL, Illinois
ELIOT L. ENGEL, New York \3\         BILL BARRETT, Nebraska
LYNN C. WOOLSEY, California          PETER HOEKSTRA, Michigan
CARLOS ROMERO-BARCELO, Puerto Rico   JAMES C. GREENWOOD, Pennsylvania
                                 ------                                

          Subcommittee on Early Childhood, Youth and Families

    RANDY ``DUKE'' CUNNINGHAM, 
       California, Chairman
DALE E. KILDEE, Michigan             WILLIAM F. GOODLING, Pennsylvania
GEORGE MILLER, California            STEVE GUNDERSON, Wisconsin
PAT WILLIAMS, Montana \5\            MICHAEL N. CASTLE, Delaware
DONALD M. PAYNE, New Jersey          SAM JOHNSON, Texas
PATSY T. MINK, Hawaii                JAMES C. GREENWOOD, Pennsylvania
ELIOT L. ENGEL, New York \3\         FRANK RIGGS, California
ROBERT C. SCOTT, Virginia            DAVE WELDON, Florida
CARLOS ROMERO-BARCELO, Puerto Rico   MARK E. SOUDER, Indiana
CHAKA FATTAH, Pennsylvania \4\       DAVID M. McINTOSH, Indiana
EARL BLUMENAUER, Oregon \4\
                                 ------                                

              Subcommittee on Oversight and Investigations

PETER HOEKSTRA, Michigan, Chairman
THOMAS C. SAWYER, Ohio               BILL BARRETT, Nebraska
MATTHEW G. MARTINEZ, California \5\  CASS BALLENGER, North Carolina
JACK REED, Rhode Island              RANDY ``DUKE'' CUNNINGHAM, 
TIM ROEMER, Indiana                  California
ROBERT C. SCOTT, Virginia            HOWARD P. ``BUCK'' McKEON, 
GENE GREEN, Texas                    California
MEL REYNOLDS, Illinois \1\           MICHAEL N. CASTLE, Delaware
CHAKA FATTAH, Pennsylvania \2\       DAVE WELDON, Florida
EARL BLUMENAUER, Oregon \4\          WILLIAM F. GOODLING, Pennsylvania
                                     HARRIS W. FAWELL, Illinois
                                 ------                                

    Subcommittee on Postsecondary Education, Training and Life-Long 
                                Learning

    HOWARD P. ``BUCK'' McKEON, 
       California, Chairman
PAT WILLIAMS, Montana                STEVE GUNDERSON, Wisconsin
ROBERT E. ANDREWS, New Jersey        DAVID M. McINTOSH, Indiana
JACK REED, Rhode Island              WILLIAM F. GOODLING, Pennsylvania
TIM ROEMER, Indiana                  THOMAS E. PETRI, Wisconsin
XAVIER BECERRA, California           MARGE ROUKEMA, New Jersey
GENE GREEN, Texas                    FRANK RIGGS, California
LYNN C. WOOLSEY, California          DAVID FUNDERBURK, North Carolina
                                     MARK E. SOUDER, Indiana

----------
\1\ Resigned October 1, 1995.
\2\ Appointed October 11, 1995.
\3\ Resigned April 22, 1996.
\4\ Appointed June 12, 1996.
\5\ Resigned June 12, 1996.


                         Letter of Transmittal

                              ----------                              

                      House of Representatives,    
                              Committee on Economic
                             and Educational Opportunities,
                                   Washington, DC, January 2, 1997.
Hon. Robin H. Carle,
Clerk of the House of Representatives,
Washington, DC.
    Dear Ms. Carle: Pursuant to rule XI, clause 1, paragraph 
(d) of the Rules of the U.S. House of Representatives, I am 
hereby transmitting the Activities Report of the Committee on 
Economic and Educational Opportunities for the 104th Congress.
    This report summarizes the activities of the Committee and 
its subcommittees with respect to its legislative and oversight 
responsibilities.
    This report has not been officially adopted by the 
Committee on Economic and Educational Opportunities or any 
subcommittee thereof and may not therefore necessarily reflect 
the views of its members.
            Sincerely,
                                           Bill Goodling, Chairman.


                              INTRODUCTION

    The Rules of the Committee on Economic and Educational 
Opportunities for the 104th Congress provide for referral of 
all matters under the Committee's jurisdiction to a 
subcommittee. Five standing subcommittees with specified 
jurisdiction are established by the Rules.
    The jurisdiction of the Committee on Economic and 
Educational Opportunities as set forth in rule X of the Rules 
of the House of Representatives is as follows:

       Extract From Rule X, Rules of the House of Representatives

                              ----------                              


                                 RULE X

         Establishment and Jurisdiction of Standing Committees


                 the committees and their jurisdiction


    1. There shall be in the House the following standing 
committees, each of which shall have the jurisdiction and 
related functions assigned to it by this clause and clauses 2, 
3, and 4; and all bills, resolutions, and other matters 
relating to subjects within the jurisdiction of any standing 
committee as listed in this clause shall (in accordance with 
and subject to clause 5) be referred to such committees, as 
follows:
          * * * * * * *
    (f) Committee on Economic and Educational Opportunities.
    (1) Child labor.
    (2) Columbia Institution for the Deaf, Dumb, and Blind; 
Howard University; Freedmen's Hospital.
    (3) Convict labor and the entry of goods made by convicts 
into interstate commerce.
    (4) Food programs for children in schools.
    (5) Labor standards and statistics.
    (6) Measures relating to education or labor generally.
    (7) Mediation and arbitration of labor disputes.
    (8) Regulation or prevention of importation of foreign 
laborers under contract.
    (9) United States Employees' Compensation Commission.
    (10) Vocational rehabilitation.
    (11) Wages and hours of labor.
    (12) Welfare of miners.
    (13) Work incentive programs.
    In addition to its legislative jurisdiction under the 
preceding provisions of this paragraph (and its general 
oversight function under clause 2(b)(1)), the committee shall 
have the special oversight function provided for in clause 3(c) 
with respect to domestic educational programs and institutions, 
and programs of student assistance, which are within the 
jurisdiction of other committees.


                                                 Union Calendar No. 478
104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     104-875
_______________________________________________________________________



 REPORT OF THE ACTIVITIES OF THE COMMITTEE ON ECONOMIC AND EDUCATIONAL 
                OPPORTUNITIES DURING THE 104TH CONGRESS

                                _______
                                

January 2, 1997.--Committed to the Committee of the Whole on the State 
                 of the Union and ordered to be printed

_______________________________________________________________________


     Mr. Goodling, from the Committee on Economic and Educational 
                 Opportunities, submitted the following

                              R E P O R T

                                Summary

    A total of 437 bills and resolutions were referred to the 
Committee in the 104th Congress. A total of 28 public laws 
resulted on issues within the Committee's jurisdiction. Two 
bills referred to the Committee were vetoed. The Full Committee 
and its five subcommittees conducted 116 days of hearings on 
legislation under consideration and on oversight and 
administration of laws within the jurisdiction of the 
Committee. The Full Committee held 14 of these hearings. 
Finally, the Full Committee and its subcommittee held a total 
of 33 days of markup sessions in the consideration of 
legislation with 21 of these being Full Commitee markup 
sessions.

                       FULL COMMITTEE ACTIVITIES

    With Republicans given the opportunity to lead the House of 
Representatives and, as such the Committee on Economic and 
Educational Opportunities, for the first time in 40 years, the 
Members of the Committee began the process of reforming the 
maze of hundreds of programs and laws that are well 
intentioned, but often ineffective in truly helping improve 
education for children and youth, human services for 
disadvantaged citizens, and the workplace for employees and 
employers. During the 104th Congress, the Committee on Economic 
and Educational Opportunities focused on the following:

                        I. Summary of Activities

                           A. Welfare reform

    The Committee on Economic and Educational Opportunities had 
a major role in the creation and eventual enactment of the 
historic welfare reform legislation achieved by the 104th 
Congress. Working together with the Committees on Ways and 
Means and Agriculture, the Committee helped to shape welfare 
reforms that (1) allow States flexibility to operate effective 
welfare systems; (2) emphasize work and personal responsibility 
as antidotes to long-term welfare dependence; (3) increase 
funding for child care to enable poor families to escape 
welfare and consolidate a former jumble of federal child care 
programs; (4) streamline child nutrition programs and target 
funding to the most needy families; (5) establish strong new 
measures to enforce child support obligations and to combat 
welfare fraud and abuse; (6) save taxpayer money; and (7) 
eliminate benefits to illegal aliens and give priority for 
benefits to citizens.
    The path to reforming welfare was not an easy one. H.R. 4, 
introduced as part of the Republican Contract with America, was 
the subject of four hearings by the Committee. Subsequently, on 
February 22 and 23, 1995, the Committee amended and approved 
H.R. 999, which included those parts of H.R. 4, and changes 
thereto, which were within the Committee's jurisdiction, 
specifically, portions of the bill dealing with work 
requirements for welfare recipients, child care programs, 
programs on child protection, child nutrition programs, and 
restrictions on benefits for non-citizens under programs within 
the Committee's jurisdiction.
    A principle aim of the reforms in H.R. 999 was the 
simplification and consolidation of numerous federal programs 
that have grown up in the area of social services, and thereby 
reduce the burden of paperwork, red tape, and complication for 
both beneficiaries and service providers. The goal was to allow 
more of the funds to be used for actual services rather than 
being soaked up by the costs of delivering those services. In 
the area of child nutrition, the bill not only consolidated 
programs and reduced paperwork, it also gave States the freedom 
and opportunity to find new approaches to increase the 
percentage of low income children that benefit from these 
programs. For example, less than 50 percent of those eligible 
for free or low priced school lunches actually participate in 
this, the largest of the child nutrition programs. The bill 
also included increased funding for the child nutrition 
programs of 4.5 percent per year over the next 5 years.
    H.R. 999 was incorporated into H.R. 4 which passed the 
House of Representatives on March 24, 1995 and, after further 
changes, was approved by the Senate on September 19, 1995. 
Final legislation was approved on December 21, 1995 by the 
House of Representatives, and approved by the Senate on 
December 22, 1995. President Clinton vetoed H.R. 4, as well as 
the budget bill which included most of the text of H.R. 4.
    Pursuant to the Budget Resolution for fiscal year 1997, on 
June 12, 1996 the Committee amended and approved an unnumbered 
committee print containing those parts of welfare reform within 
the Committee's jurisdiction. The Committee's submission was 
incorporated into H.R. 3734, the Welfare and Medicaid Reform 
Act of 1996, prior to consideration by the House of 
Representatives. H.R. 3734 was approved by the House of 
Representatives on July 18, 1996 and by the Senate on July 23, 
1996. The Committee participated actively in the deliberations 
of the bill by the House of Representatives as well as during 
the House and Senate Conference on H.R. 3734. The conference 
agreement was approved by the House on July 31, 1996 and by the 
Senate on August 1, 1996. President Clinton signed the bill 
into law as Public Law 104-193 on August 22, 1996.
    Further descriptions of the Committee's activities related 
to welfare, including Job Opportunities and Basic Skills 
Program (JOBS), child welfare and child care, can be found in 
the ``Postsecondary, Education, Training and Life-Long 
Learning'' and the ``Early Childhood, Youth and Families'' 
sections of this report.

                b. the congressional accountability act

    In large part because of the efforts of the Members of the 
Committee, the Congressional Accountability Act (CAA) was the 
very first measure passed by the Republican-led 104th Congress. 
This measure was signed into law as P.L. 104-1 by President 
Clinton on January 23, 1995. Passage of the legislation marked 
the culmination of a long effort by Republican Members of the 
Committee to extend workplace laws to the Congress with 
enforcement in the courts, including trials by juries.
    The CAA effectively extends 11 workplace laws to the House 
and the Senate. All but two of the laws (the Federal Labor-
Management Relations Act and the Occupational Safety and Health 
Act) were applied to Congress on January 23, 1996:
          1. Fair Labor Standards Act of 1938
          2. Title VII of the Civil Rights Act of 1964
          3. Americans with Disabilities Act of 1990
          4. Age Discrimination in Employment Act of 1967
          5. Titles I and V of the Family and Medical Leave Act 
        of 1993
          6. Occupational Safety and Health Act of 1970 (will 
        apply in January 1997)
          7. Chapter 71 (relating to Federal service labor-
        management relations) of title 5, United States Code 
        (applied in October 1996)
          8. Employee Polygraph Protection Act of 1988
          9. Worker Adjustment and Retraining Notification Act
          10. Rehabilitation Act of 1973
          11. Chapter 43 (relating to veterans' employment and 
        reemployment) of title 38, United States Code.
The Congress had been brought under some of these laws in the 
past, but employees have never had the right to trial in court.

                         c. immigration reform

    The Committee also had significant involvement in the 
development of the comprehensive immigration reform legislation 
that was enacted into law as part of the omnibus appropriations 
bill. The Committee held a hearing on the issue of immigration 
reform in San Diego, California on February 22, 1996, and heard 
about the impact of both legal and illegal immigration from a 
preeminent slate of witnesses led by the Governor of 
California, Pete Wilson. Testimony was also received concerning 
the impact of comprehensive immigration reform legislation--
H.R. 2202, Immigration in the National Interest Act of 1995--
upon public benefits' programs, and education and employment-
related laws under the jurisdiction of the Committee.
    With respect to employment issues, the legislation 
recognized that one of the primary inducements to illegal 
immigration is the availability of U.S. jobs and that this 
nation will never be able to fully control its borders with law 
enforcement strategies alone. The immigration reform 
legislation also recognized, however, the practical constraints 
on employers in policing the attempts of immigrants to 
illegally secure employment. The immigration reform bill 
resolves this tension by including needed reforms in the 
worksite verification process and authorizing a workable pilot 
telephone verification system to allow employers to readily 
document which applicants for employment are legally authorized 
to work.
    The legislation also recognizes the importance of 
education-related benefits to legal immigrants. Under the bill, 
legal immigrants will continue to be eligible to apply for and 
receive benefits under the National School Lunch Act, the Child 
Nutrition Act, the Head Start Act, the Job Training Partnership 
Act, and the Higher Education Act of 1965, and participate in 
programs funded under the Elementary and Secondary Education 
Act of 1965.
    The immigration reform legislation--ultimately enacted as 
part of H.R. 3610, the Omnibus Consolidated Appropriations 
legislation for fiscal year 1997 (Public Law 104-208)--tackles 
the problems caused by illegal immigration and fosters the 
sense of responsibility that we hope will be felt by all 
newcomers to our great nation. The immigration reform 
accomplished by the Republican Congress brings this nation back 
to the point where we can welcome the hope and creativity that 
new voices can offer us while feeling secure that the wonderful 
opportunities that life here presents will continue to be 
available for generations to come.

                         D. STRIKER REPLACEMENT

    On March 8, 1995, President Clinton issued Executive Order 
No. 12954, which prohibited employers with federal contracts in 
excess of $100,000 from hiring permanent replacements for 
striking workers. That same day, legislation (H.R. 1176) was 
introduced by Chairman Goodling and other Republican Members of 
the Committee to render the Executive Order null and void.
    The Committee held a hearing on H.R. 1176 and Executive 
Order 12954 on April 5, 1995. The hearing focused on both the 
policy implications of a ban on striker replacement workers and 
on the legality, from a constitutional perspective, of the 
Executive Order.
    The Committee considered and reported H.R. 1176 on June 27, 
1995. Although the full House did not consider H.R. 1176 
separately, a provision precluding funding for the Executive 
Order was included in the Labor, HHS appropriations bill (H.R. 
2127) which was passed by the House on August 4, 1995. Further 
legislative action became unnecessary when, on February 2, 
1996, the U.S. Court of Appeals for the District of Columbia 
invalidated the Executive Order, and a subsequent 
Administration petition for a rehearing was denied.

                        E. NUTRITION ACTIVITIES

1. Welfare reform

    During the 104th Congress, the Committee on Economic and 
Educational Opportunities helped initiate major changes to 
federal child nutrition programs and the Special Supplemental 
Nutrition Program for Women, Infants and Children.
    On February 1, 1995, the Committee held a hearing titled 
``Nutrition, the Local Perspective.'' Local providers were 
invited to testify on existing federal nutrition programs and 
how their ability to provide nutrition services to 
beneficiaries was impeded by burdensome, restrictive federal 
regulations. It was clear from this hearing and past hearings 
on child nutrition programs that the current programs were in 
need of reform. Paperwork requirements and restrictive 
regulations prevented providers from preparing and serving 
nutritious meals which children would eat.
    As a result, H.R. 999, the Welfare Reform Consolidation Act 
of 1995 (as considered by the Committee) included two flexible 
State block grants designed to replace existing nutrition 
programs, to ease the burden on State and local providers and, 
at the same time, to ensure the nutritional needs of low income 
individuals were met.
    The first block grant focused on school-based nutrition 
programs, such as school lunch and school breakfast. It 
provided funds to operate these programs as well as summer 
feeding programs and programs to schools which provided 
nutrition services to children in before and after-school child 
care. In this way, schools would no longer be required to fill 
out separate applications and meet a variety of conflicting 
regulations in order to serve the same children under a variety 
of programs designed to meet their nutritional needs.
    The second block grant, the Family Nutrition Block Grant, 
was designed to meet the nutritional needs of low income 
children and pregnant mothers, provide meals and supplements to 
children in child care and to provide for the operation of a 
summer food program to meet the needs of children when they 
were not in school. This program was focused on meeting the 
needs of families with incomes below 185 percent of poverty. 
Eighty percent of available program dollars were to be used for 
a program to provide food assistance to pregnant, postpartum 
and breastfeeding women, and infants and children (WIC) found 
to be at nutritional risk.
    H.R. 999, the Welfare Reform Consolidation Act of 1995, 
which included both block grants, was reported by the Committee 
on Economic and Educational Opportunities on February 23, 1995. 
H.R. 999 was eventually merged with H.R. 4, the Personal 
Responsibility Act, and sent to the President on December 29, 
1995, and subsequently vetoed.
    During the House-Senate Conference on the nutrition 
provisions contained in the welfare bill, a decision was made 
to allow up to seven States to receive block grant funds for 
school lunch and school breakfast programs. States applying for 
such funds would be required to serve the same or greater 
proportion of poor and low income students. In addition, 
conferees agreed to make major streamlining and paperwork 
changes to the current child nutrition programs and to provide 
greater flexibility to States and local providers. The bulk of 
the savings attributable to changes in child nutrition programs 
was derived from the implementation of a means test for 
children in family day care homes receiving benefits under the 
Child and Adult Care Food Program.
    The Budget Reconciliation bill for fiscal year 1997, H.R. 
3734, the Welfare and Medicaid Reform Act of 1996, as reported 
from the Committee on June 12, 1996, contained a modified 
version of this legislation. The block grant provisions were 
eliminated, and several changes were made to strengthen 
streamlining, paperwork reduction and flexibility provisions. 
This legislation was signed into law by the President on August 
22, 1996, and is now P.L. 104-193.

2. H.R. 2066, The Healthy Meals for Children Act

    On May 1, 1996, the Committee on Economic and Educational 
Opportunities reported H.R. 2066, The Healthy Meals for 
Children Act. The purpose of this legislation was to amend the 
National School Lunch Act to provide more flexibility to local 
schools in demonstrating they have met the Dietary Guideline 
requirements of the National School Lunch Act.
    Final regulations were issued by the Department of 
Agriculture to establish the new Dietary Guidelines-based 
nutrition criteria and the menu-planning requirements for 
implementing them were issued June 13, 1995. Unfortunately, 
these regulations did not provide schools with the menu-
planning flexibility that Congress sought in the 1994 
amendments. Schools which desired to comply with the Guidelines 
by using another nutritionally sound approach, such as their 
existing food-based menu system or their own meal pattern 
revisions were required to get a waiver from the State. While 
retaining the requirement that school meals comply with the 
Dietary Guidelines, H.R. 2066 permits schools to use any 
reasonable approach to achieve this goal. This change will 
allow schools to prepare meals which are not only healthy and 
nutritious, but which students will eat.
    H.R. 2066 passed the House of Representatives on May 14, 
1996, by voice vote, and the Senate on May 16, 1996, by voice 
vote. The bill was signed into law by the President on May 29, 
1996. It is Public Law 104-119.

3. H.R. 2428, The Bill Emerson Good Samaritan Food Donation Act

    H.R. 2428, The Bill Emerson Good Samaritan Food Donation 
Act, was introduced by Representative Pat Danner and the late 
Representative Bill Emerson to encourage the donation of food 
and grocery products to non-profit organizations for 
distribution to needy individuals by giving the Model Good 
Samaritan Food Donation Act the full force and effect of law.
    A hearing on H.R. 2428 was held by the Subcommittee on 
Postsecondary Education, Training and Life-Long Learning on May 
31, 1996. Representative Pat Danner and several organizations, 
which accepted and distributed donated foods, testified at this 
hearing. Representative Bill Emerson was unable to testify 
because of illness and submitted his testimony.
    On June 26, 1996, the Economic and Educational 
Opportunities Committee considered H.R. 2428 and ordered it 
reported, as amended, by voice vote. H.R. 2428 was considered 
by the House of Representatives and passed by voice vote on 
July 12, 1996. The Senate amended and considered this 
legislation on August 2, 1996, and returned it to the House of 
Representatives for further consideration. The bill, as amended 
by the Senate, was considered and passed by the House of 
Representatives by unanimous consent on September 5, 1996. It 
was signed into law by the President on October 1, 1996, and is 
known as Public Law 104-210.
    This legislation was originally enacted as a Sense of the 
Congress Resolution in the National and Community Service Act 
of 1990. The Good Samaritan Food Donation Act, at that time, 
was to serve as a model law which States were encouraged to 
adopt. The purpose of the Good Samaritan Food Donation Act was 
to protect those who donate food in good faith from civil or 
criminal liability should those consuming such donated food 
later become sick or die. It did not, and does not, provide 
such protections in cases of gross negligence or intentional 
harm. This bill also paid tribute to Bill Emerson's lifelong 
efforts to alleviate hunger in America.

                            F. SCHOOL REFORM

What works in public education?

    During the 104th Congress the House Committee on Economic 
and Educational Opportunities held several hearings on 
education reform. Full Committee hearings were held on January 
12, 1995, and January 31, 1996. Their purpose was to confirm 
the need for education reform, to learn what type of reforms 
were needed, and to identify reform practices that have been 
proven effective.
    Witnesses at the January 12, 1995, hearing provided Members 
with national, State, and local perspectives on what is the 
appropriate federal role in educational policy. The panel of 
witnesses included Richard Riley, Secretary of Education, 
Governor Tommy Thompson of Wisconsin, and Mayor Bret Schundler 
of Jersey City, New Jersey. The overriding sentiment from the 
hearing was that the federal government should encourage 
innovation and excellence in education. According to the panel, 
this can be accomplished by driving decisions to localities and 
giving States and localities greater flexibility to design and 
implement creative approaches to improving the quality of 
education.
    The purpose of the January 31, 1996, hearing was to learn 
what works in public education. Members heard about a variety 
of local school reform initiatives being implemented throughout 
the country. While the structure and substance of reforms 
differed, the net result was the same: student achievement and 
parental satisfaction increased.
    Further discussion on school reform can be found in the 
``Subcommittee on Early Childhood, Youth and Families'' and 
``Subcommittee on Oversight and Investigations'' sections of 
this report.

Focusing on local control: Repeal of National Education Standards and 
        Improvement Council

    On February 24, 1995, Chairman Bill Goodling introduced 
H.R. 1045 which repealed the National Education Standards and 
Improvement Council (NESIC) created by the Goals 2000: Educate 
America Act of 1994. NESIC was a Presidentially appointed 
council with the mission of reviewing and certifying national 
education standards and State education standards that are 
voluntarily submitted to it. Because decisions about educating 
children are primarily decided at the local level by parents, 
teachers and students, NESIC, commonly referred to as a 
``national school board'' by its critics, generated great 
controversy about continued local control of education.
    On May 10, 1995, H.R. 1045 was ordered reported by the 
Committee on Economic and Educational Opportunities by a voice 
vote and no Committee report was filed. On May 15, 1995, H.R. 
1045 passed the House of Representatives by voice vote under 
Suspension of the Rules. The Senate never took action on H.R. 
1045, however NESIC was subsequently repealed by amendments 
made in Public Law 104-134, the Balanced Budget Downpayment Act 
II enacted on April 26, 1996.

Education technology

    The Economic and Educational Opportunities Committee, 
recognizing the importance of gathering information on 
technology uses in the classroom, held a joint hearing on 
October 12, 1995 with the House Science Committee. The hearing, 
entitled ``Education Technology in the 21st Century,'' focused 
on the impact of technology in elementary and secondary school 
classrooms today and what to expect in the classrooms of the 
21st Century.

    G. NATIONAL ENDOWMENT FOR THE ARTS--NATIONAL ENDOWMENT FOR THE 
                               HUMANITIES

    While authorization for the National Endowment for the Arts 
(NEA) expired at the end of fiscal year 1993, funding has 
continued to be appropriated on a yearly basis since that time. 
However, no authorizing legislation has been enacted primarily 
because of controversy surrounding a number of works funded by 
the NEA.
    On May 3, 1995, Chairman Bill Goodling introduced H.R. 
1557, a bill to authorize the NEA and the National Endowment 
for Humanities (NEH) for three additional years with a phase-
out effective as of September 30, 1998. The bill provided for 
the continuation of the Institute of Museum Services, but with 
no phase-out. H.R. 1557, as amended by a Committee substitute, 
was approved by the Economic and Educational Opportunities 
Committee on May 10, 1995. Though no further action took place 
in the House of Representatives or the Senate, the fiscal year 
1996 Interior Appropriations bill, H.R. 1977, reduced funding 
levels for the NEA and NEH approximately 40 percent to levels 
near the authorizing bill's proposed funding levels.
    The three year phase-out would have returned control of 
arts and humanities programs to the State and local level, 
provided for the orderly transition of arts and humanities 
funding back to the private sector, and would have helped 
reduce deficit spending.

                II. Meetings Held by the Full Committee

104th Congress, First Session

    January 5, 1995--Committee organizational meeting.
    January 11, 1995--Oversight hearing on the proper federal 
role in education policy.
    January 12, 1995--Oversight hearing on the proper federal 
role in education policy.
    January 18, 1995--Hearing on H.R. 4, Personal 
Responsibility Act of 1995.
    February 1, 1995--Oversight hearing on the Contract with 
America: Nutrition, the local perspective.
    February 7, 1995--Committee budget request and oversight 
plan for the 104th Congress.
    February 22, 1995--Mark-up of H.R. 999, ``Welfare Reform 
Consolidation Act of 1995''.
    February 23, 1995--Mark-up of H.R. 999, ``Welfare Reform 
Consolidation Act of 1995''.
    March 15, 1995--Mark-up of H.R. 849, ``Age Discrimination 
in Employment Amendments of 1995''.
    April 5, 1995--Hearing on H.R. 1176, to nullify Executive 
Order 12954, prohibiting federal contracts with companies that 
hire permanent replacements for striking workers.
    May 10, 1995--Mark-up of H.R. 1045, to amend goals 2000, 
NESIC.
    Mark-up of H.R. 1557, ``Arts, Humanities, and Human 
Services Act''.
    May 11, 1995--Hearing on H.R. 743, Teamwork for Managers 
Act of 1995.
    May 24, 1995--Mark-up of H.R. 1617, ``Workforce and Career 
Development Act of 1996''.
    June 7, 1995--Hearing on Departmental Reorganization.
    June 8, 1995--Mark-up of H.R. 1720, ``Privatization Act of 
1995''.
    June 14, 1995--Mark-up of H.R. 1176, to nullify Executive 
Order 12954, prohibiting federal contracts with companies that 
hire permanent replacements for striking workers.
    June 22, 1995--Mark-up of H.R. 1715, respecting the 
relationship between workers' compensation benefits and the 
benefits available under the Migrant and Seasonal Agricultural 
Worker Protection Act.
    Mark-up of H.R. 743, ``Teamwork for Employees and Managers 
Act''.
    June 29, 1995--Hearing on Departmental Reorganization.
    July 20, 1995--Mark-up of H.R. 1594, regarding Pension 
Protection Act (ETI).
    Mark-up of H.R. 1225, ``Court Reporter Fair Labor 
Amendments of 1995''.
    Mark-up of H.R. 1114, to authorize minors who are under the 
child labor provisions of the Fair Labor Standards Act of 1938 
and who are under 18 years of age to load materials into balers 
and compactors that meet appropriate American National 
Standards Institute design safety standards.
    July 25, 1995--Hearing on Departmental Reorganization.
    September 28, 1995--Mark-up of instructions contained in 
the Concurrent Resolution on the Budget Resolution for FY 1996.
    October 12, 1995--Joint hearing on technology in the 21st 
century, held with the Committee on Science.

104th Congress, Second Session

    January 31, 1996--Oversight hearing on what works in public 
education.
    February 7, 1996--Hearing on H.R. 2497, to amend the 
National Labor Relations Act.
    February 22, 1996--Field hearing on H.R. 2202, Immigration 
in the National Interest Act of 1995, held in San Diego, 
California.
    March 6, 1996--Mark-up of H.R. 995, ``ERISA Targeted Health 
Insurance Reform Act of 1995''.
    Consideration of Resolutions regarding the Congressional 
Accountability Act; Committee instructed Chairman to seek 
adoption of the Resolutions by the House.
    March 14, 1996--Mark-up of H.R. 2570, ``Older Americans 
Amendments of 1996''.
    Mark-up of H.R. 3049, to amend section 1505 of the Higher 
Education Act of 1965 to provide for the continuity of the 
Board of Trustees of the Institute of American Indian and 
Alaska Native Culture and Arts Development.
    Mark-up of H.R. 3055, to amend section 326 of the Higher 
Education Act of 1965 to permit continued participation by 
Historically Black Graduate Professional Schools in the grant 
program authorized by that section.
    March 21, 1996--Mark-up of H.R. 1227, to amend the Portal-
to-Portal Act of 1947 relating to the payment of wages to 
employees who use employer owned vehicles.
    Mark-up of H.R. 2531, to amend the Fair Labor Standards Act 
of 1938 to clarify the exemption for houseparents from the 
minimum wage and maximum hours requirements of that Act, and 
for other purposes.
    April 12, 1996--Joint field hearing on salting, held in 
Overland Park, Kansas, with the Committee on Small Business.
    May 1, 1996--Mark-up of H.R. 2066, ``Healthy Meals for 
Children Act''.
    Mark-up of H.R. 3269, ``Impact Aid Technical Amendments Act 
of 1996''.
    May 30, 1996--Mark-up of H.R. 3268, ``IDEA Improvement Act 
of 1996''.
    June 12, 1996--Consideration of Welfare Reform Committee 
Print
    June 26, 1996--Mark-up of H.R. 2391, ``Working Families 
Flexibility Act of 1996''.
    Mark-up of H.R. 2428, ``Bill Emerson Good Samaritan Food 
Donation Act''.
    July 24, 1996--Mark-up of H.R. 123, ``English Language 
Empowerment Act of 1996''.
    August 1, 1996--Mark-up of H.R. 3863, ``Student Debt 
Reduction Act of 1996''.
    Mark-up of H.R. 3876, ``Juvenile Crime Control and 
Delinquency Prevention Act of 1996''.
    Mark-up of H.Res. 470, Expressing the Sense of the Congress 
that the Department of Education should play a more active role 
in monitoring and enforcing compliance with the provisions of 
the Higher Education Act of 1965 related to campus crime.
    August 2, 1996--Continue Mark-up of H.R. 3876, ``Juvenile 
Crime Control and Delinquency Prevention Act of 1996''.

                      III. Legislative Activities

                    A. Legislation Enacted into Law

    P.L. 104-26 (H.R. 1225), ``Court Reporter Fair Labor 
Amendments of 1995''.
    P.L. 104-49 (H.R. 1715), respecting the relationship 
between workers' compensation benefits and the benefits 
available under the Migrant and Seasonal Agricultural Worker 
Protection Act.
    P.L. 104-141 (H.R. 3055), to amend section 326 of the 
Higher Education Act of 1965 to permit continued participation 
by Historically Black Graduate Professional Schools in the 
grant program authorized by that section.
    P.L. 104-149 (H.R. 2066), ``Healthy Meals for Children 
Act''.
    P.L. 104-174 (H.R. 1114), to authorize minors who are under 
the child labor provisions of the Fair Labor Standards Act of 
1938 and who are under 18 years of age to load materials into 
balers and compactors that meet appropriate American National 
Standards Institute design safety standards.
    P.L. 104-191 (H.R. 3103), ``Health Insurance Portability 
and Accountability Act of 1996''.
    P.L. 104-195 (H.R. 3269), ``Impact Aid Technical Amendments 
Act of 1996''.
    P.L. 104-210 (H.R. 2428), ``Bill Emerson Good Samaritan 
Food Donation Bill''.
    P.L. 104-272 (H.R. 4167), ``Professional Boxing Safety Act 
of 1996''.
    P.L. 104-331 (H.R. 3452), ``Presidential and Executive 
Office Accountability Act''.

           B. Legislation Enacted as Part of Another Measure

    H.R. 1, ``Congressional Accountability Act of 1995''. 
Provisions of the bill were included in S. 2 and enacted as 
P.L. 104-1.
    H.R. 4, ``Personal Responsibility Act of 1995''. Provisions 
of the bill were included in H.R. 3734 and enacted as P.L. 104-
193.
    H.R. 849, ``Age Discrimination in Employment Amendments'', 
was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 995, ``ERISA Targeted Health Insurance Reform Act of 
1995''. Provisions of the bill were included in H.R. 3103 and 
enacted as P.L. 104-191.
    H.R. 999, ``Welfare Reform Consolidation Act of 1995''. 
Incorporated into H.R. 4 and provisions of the bill were 
included in H.R. 3734 and enacted as P.L. 104-193.
    H.R. 1227, ``Employee Commuting Flexibility Act'', was 
included in H.R. 3448 and enacted as P.L. 104-188.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''. Provisions of the bill were included in H.R. 3610 and 
enacted as P.L. 104-208.
    H.R. 1720, ``Privatization Act of 1995''. Provisions of the 
bill were included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 2202, ``Immigration in the National Interest Act of 
1995'', was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 2396, ``Congressional Award Act Amendments of 1995'', 
was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 3160, ``Health Coverage Availability and Affordability 
Act of 1996''. Provisions of the bill were included in H.R. 
3103 and enacted as P.L. 104-191.
    H.R. 3286, ``Adoption Promotion and Stability Act of 
1996''. Provisions of the bill were included in H.R. 3448 and 
enacted as P.L. 104-188.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act'', was included in H.R. 4036 and enacted as P.L. 
104-319.
    H.R. 3829, ``Welfare Reform Reconciliation Act of 1996'', 
considered as original text of H.R. 3734 and enacted as P.L. 
104-193.
    H.R. 4282, to amend the National Defense Authorization Act 
for FY 93 to make a technical correction relating the provision 
of DOD assistance to local educational agencies, was included 
in H.R. 3610 and enacted as P.L. 104-208.
    S. 1267, ``Congressional Award Act Amendments of 1995'', 
was included in H.R. 3610 and enacted as P.L. 104-208.
    S. 1972, ``Older Americans Indian Technical Amendments 
Act'', was included in H.R. 3610 and enacted as P.L. 104-208.

    c. bills not referred to committee and enacted into public law 
containing provisions or bills under the jurisdiction of the committee 
               on economic and educational opportunities

    H.R. 3230, ``National Defense Authorization Act for FY 
97'', includes Impact Aid provisions and enacted as P.L. 104-
201.
    H.R. 3448, ``Small Business Job Protection Act of 1996'', 
includes H.R. 1227, ERISA amendments, and adoption provisions 
of H.R. 3286 under Section 1808 and enacted as P.L. 104-188.
    H.R. 3610, making appropriations for the Department of 
Defense for the fiscal year ending September 30, 1997, and for 
other purposes (Omnibus FY 97 Appropriations Bill). This bill 
includes impact aid, labor and needs based federal education 
programs provisions along with provisions from the following 
bills and was enacted as P.L. 104-208: H.R. 849, H.R. 1617 
(museum and library services), H.R. 1720 (Sallie Mae and Connie 
Lee), H.R. 2202, S. 1972, H.R. 4282, H.R. 2396, and S. 1267.
    H.R. 3734, ``Personal Responsibility and Work Opportunity 
Act of 1996''. This bill includes welfare provisions from the 
following bills and was enacted as P.L. 104-193: H.R. 999, H.R. 
4 and H.R. 3829.
    H.R. 4036, to strengthen the protection of internationally 
recognized human rights, includes H.R. 3803 and enacted as P.L. 
104-319.
    S. 2, to make certain laws applicable to the legislative 
branch of the Federal Government, includes provisions of H.R. 1 
and enacted as P.L. 104-1.
    S. 377, to amend a provision of part A of title IX of the 
Elementary and Secondary Education Act of 1965, relating to 
Indian education, to provide a technical amendment, includes 
secondary education provisions and enacted as P.L. 104-5.
    S. 919, to modify and reauthorize the Child Abuse 
Prevention and Treatment Act, and for other purposes. This bill 
is under the jurisdiction of the Committee and was held at the 
desk before being enacted as P.L. 104-235.
    S. 1124/H.R. 1530, ``National Defense Authorization Act for 
FY 96'', includes Impact Aid provisions and enacted as P.L. 
104-106.
    S. 2183, to make technical corrections to the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996. 
This bill makes technical corrections to welfare provisions 
under the jurisdiction of the Committee and was enacted as P.L. 
104-327.

                    d. Legislation Passed the House

    H.R. 1, ``Congressional Accountability Act of 1995''.
    H.R. 4, ``Personal Responsibility Act of 1995''.
    H.R. 123, ``Bill Emerson English Language Empowerment Act 
of 1996''.
    H.R. 743, ``Teamwork for Employers and Managers Act of 
1995''.
    H.R. 849, ``Age Discrimination in Employment Amendments of 
1995''.
    H.R. 1045, ``To amend Goals 2000: Educate America Act to 
eliminate the National Education Standards and Improvement 
Council.
    H.R. 1114, to authorize minors who are under the child 
labor provisions of the Fair Labor Standards Act of 1938 and 
who are under 18 years of age to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards.
    H.R. 1225, ``Court Reporter Fair Labor Amendments of 
1995''.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles.
    H.R. 1594, to place restrictions on the promotion by the 
Department of Labor and other Federal agencies and 
instrumentalities of economically targeted investments in 
connection with employee benefit plans.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 1715, respecting the relationship between workers' 
compensation benefits and the benefits available under the 
Migrant and Seasonal Agricultural Worker Protection Act.
    H.R. 1720, ``Privatization Act of 1995''.
    H.R. 2066, ``Healthy Meals for Children Act''.
    H.R. 2092, ``Private Security Officer Quality Assurance Act 
of 1995''.
    H.R. 2202, ``Immigration in the National Interest Act of 
1995''.
    H.R. 2391, ``Working Families Flexibility Act of 1996''.
    H.R. 2428, to encourage the donation of food and grocery 
products to nonprofit organizations for distribution to needy 
individuals by giving the Model Good Samaritan Food Donation 
Act the full force and effect of law.
    H.R. 3049, to amend section 1505 of the Higher Education 
Act of 1965 to provide for the continuity of the Board of 
Trustees of the Institute of American Indian and Alaska Native 
Culture and Arts Development.
    H.R. 3055, to amend section 326 of the Higher Education Act 
of 1965 to permit continued participation by Historically Black 
Graduate Professional Schools in the grant program authorized 
by that section.
    H.R. 3103, ``Health Insurance Portability and 
Accountability Act of 1996''.
    H.R. 3268, ``IDEA Improvement Act of 1996''.
    H.R. 3269, ``Impact Aid Technical Amendments Act of 1996''.
    H.R. 3286, ``Adoption Promotion and Stability Act of 
1996''.
    H.R. 3452, ``Presidential and Executive Office 
Accountability Act''.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act''.
    H.R. 3863, ``Student Debt Reduction Act of 1996''.
    H.R. 4134, to amend the Immigration and Nationality Act to 
authorize States to deny public education benefits to aliens 
not lawfully present in the United States who are not enrolled 
in public schools during the period beginning September, 1, 
1996, and ending July 1, 1997.
    H.R. 4167, ``Professional Boxing Safety Act of 1996''.
    H.R. 4282, to amend the National Defense Authorization Act 
for FY 93 to make a technical correction relating to the 
provision of the Department of Defense Assistance to local 
educational agencies.
    H.Con.Res. 123, to provide for the provisional approval of 
regulations applicable to certain covered employing offices and 
covered employees and to be issued by the Office of Compliance 
before January 23, 1996.
    H.Con.Res. 207, approving certain regulations to implement 
provisions of the Congressional Accountability Act of 1995 
relating to labor-management relations with respect to covered 
employees, other than employees of the House of Representatives 
and employees of the Senate, and for other purposes.
    H.Res. 311, to provide for the provisional approval of 
regulations applicable to the House of Representatives and 
employees of the House of Representatives and to be issued by 
the Office of Compliance before January 23, 1996.
    H.Res. 470, expressing the sense of the Congress that the 
Department of Education should play a more active role in 
monitoring and enforcing compliance with the provisions of the 
Higher Education Act of 1965 relating to crime.
    H.Res. 504, approving certain regulations to implement 
provisions of the Congressional Accountability Act of 1995 
relating to labor-management relations with respect to 
employing offices and covered employees of the House of 
Representatives, and for other purposes.
    S. 1972, ``Older Americans Indian Technical Amendments 
Act''.

           e. legislation passed the house in another measure

    H.R. 1, ``Congressional Accountability Act of 1995''. 
Provisions of the bill passed the House in S. 2.
    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''. Provisions of the bill passed the House in H.R. 
2491.
    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''. Provisions of the bill passed the House in H.R. 
3734.
    H.R. 5, ``ERISA Targeted Health Insurance Reform Act of 
1995''. Provisions of the bill passed the House in H.R. 3103.
    H.R. 999, ``Welfare Reform Consolidation Act of 1995'', 
passed the House in H.R. 4.
    H.R. 1157, ``Welfare Transformation Act of 1995'', passed 
the House in H.R. 4.
    H.R. 1214, ``Personal Responsibility Act of 1995'', passed 
the House as original text of H.R. 4.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles, passed the House in H.R. 3448.
    H.R. 1617, ``Workforce and Career Development Act of 
1996'', passed the House in S. 1972.
    H.R. 1720, ``Privatization Act of 1995'', passed the House 
in H.R. 1617.
    H.R. 1720, ``Privatization Act of 1995'', passed the House 
in S. 1972.
    H.R. 2332, ``Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems Act'' or ``CAREERS 
Act''. Provisions of the bill passed the House in H.R. 1617.
    H.R. 2517, ``Seven-Year Balanced Budget Reconciliation Act 
of 1995'', passed the House as text of H.R. 2491.
    H.R. 3160, ``Health Coverage Availability and Affordability 
Act of 1996''. Provisions of the bill passed the House in H.R. 
3103.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act'', passed the House in H.R. 4036.
    H.R. 3829, ``Welfare Reform Reconciliation Act of 1996'', 
passed the House as original text of H.R. 3734.
    H.R. 3863, ``Student Debt Reduction Act of 1996'', passed 
the House in S. 1972.
    H.R. 3898, ``English Language Empowerment Act of 1996''. 
Provisions of the bill passed the House in H.R. 123.

                   f. legislation with filed reports

    H.R. 123 (H.Rept. 104-723), ``Bill Emerson English Language 
Empowerment Act of 1996''.
    H.R. 743 (H.Rept. 104-248), ``Teamwork for Employers and 
Managers Act of 1995''.
    H.R. 995 (H.Rept. 104-498, Pt. 1), ``ERISA Targeted Health 
Insurance Reform Act of 1995''.
    H.R. 999 (H.Rept. 104-75, Pt. 1), ``Welfare Reform 
Consolidation Act of 1995''.
    H.R. 1114 (H.Rept. 104-278), to authorize minors who are 
under the child labor provisions of the Fair Labor Standards 
Act of 1938 and who are under 18 years of age to load materials 
into balers and compactors that meet appropriate American 
National Standards Institute design safety standards.
    H.R. 1176 (H.Rept. 104-163), to nullify an executive order 
that prohibits Federal contracts with companies that hire 
permanent replacements for striking employees.
    H.R. 1225 (H.Rept. 104-219), ``Court Reporter Fair Labor 
Amendments of 1995''.
    H.R. 1227 (H.Rept. 104-585), to amend the Portal-to-Portal 
Act of 1947 relating to the payment of wages to employees who 
use employer owned vehicles.
    H.R. 1557 (H.Rept. 104-170), ``Arts, Humanities, and Museum 
Services Amendments of 1995''.
    H.R. 1594 (H.Rept. 104-238), to place restrictions on the 
promotion by the Departments of Labor and other Federal 
agencies and instrumentalities of economically targeted 
investments in connection with employee benefit plans.
    H.R. 1617 (H.Rept. 104-152), ``Workforce and Career 
Development Act of 1996''.
    H.R. 1720 (H.Rept. 104-153), ``Privatization Act of 1995''.
    H.R. 2066 (H.Rept. 104-561), ``Healthy Meals for Children 
Act''.
    H.R. 2391 (H.Rept. 104-670), ``Working Families Flexibility 
Act of 1996''.
    H.R. 2428 (H.Rept. 104-661), to encourage the donation of 
food and grocery products to nonprofit organizations for 
distribution to needy individuals by giving the Model Good 
Samaritan Food Donation Act the full force and effect of law.
    H.R. 2531 (H.Rept. 104-592), to amend the Fair Labor 
Standards Act of 1938 to clarify the exemption for houseparents 
from the minimum wage and maximum hours requirements of that 
Act, and for other purposes.
    H.R. 2570 (H.Rept. 104-539), ``Older Americans Amendments 
of 1995''.
    H.R. 3049 (H.Rept. 104-505), to amend section 1505 of the 
Higher Education Act of 1965 to provide for the continuity of 
the Board of Trustees of the Institute of American Indian and 
Alaska Native Culture and Arts Development.
    H.R. 3055 (H.Rept. 104-504), to amend section 326 of the 
Higher Education Act of 1965 to permit continued participation 
by Historically Black Graduate Professional Schools in the 
grant program authorized by that section.
    H.R. 3268 (H.Rept. 104-614), ``IDEA Improvement Act of 
1996''.
    H.R. 3269 (H.Rept. 104-560), ``Impact Aid Technical 
Amendments Act of 1996''.
    H.R. 3863 (H.Rept. 104-775), ``Student Debt Reduction Act 
of 1996''.
    H.R. 3876 (H.Rept. 104-783), ``Juvenile Crime Control and 
Delinquency Prevention Act of 1996''.
    H.Con.Res. 470 (H.Rept. 104-776), expressing the sense of 
the Congress that the Department of Education should play a 
more active role in monitoring and enforcing compliance with 
the provisions of the Higher Education Act of 1965 related to 
campus crime.

  g. bills not referred to committee that passed the house containing 
provisions or bills under the jurisdiction of the committee on economic 
                      and education opportunities

    H.R. 1530, to authorize appropriations for FY 96 for 
military activities of the Department of Defense, to prescribe 
military personnel strengths for FY 96, includes Impact Aid 
provisions (sec. 394).
    H.R. 2491, ``Balance Budget Act of 1995'', includes welfare 
reform, student aid and ERISA provisions along with provisions 
from the following bills: H.R. 4, and H.R. 2517.
    H.R. 3230, to authorize appropriations for fiscal year 1997 
for military activities of the Department of Defense, to 
prescribe military personnel strengths for fiscal year 1997, 
and for other purposes, includes Impact Aid provisions.
    H.R. 3448, ``Small Business Job Protection Act of 1996'', 
includes H.R. 1227, ERISA amendments, and adoption provisions 
of H.R. 3286 under Section 1808.
    H.R. 3610, making appropriations for the Department of 
Defense for the fiscal year ending September 30, 1997, and for 
other purposes (Omnibus FY 97 Appropriations Bill), includes 
impact aid provisions.
    H.R. 3734, ``Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996'', includes welfare reform 
provisions from H.R. 999, H.R. 4 and H.R. 3829.
    H.R. 4036, to strengthen the protection of internationally 
recognized human rights, includes H.R. 3803.
    H.Con.Res. 108, to correct technical errors in the 
enrollment of the bill H.R. 1594, includes technical correction 
to ETI provisions.
    S. 2, to make certain laws applicable to the legislative 
branch of the Federal Government, includes provisions of H.R. 
1.
    S. 377, to amend a provision of part A, of title IX of the 
Elementary and Secondary Education Act of 1965, relating to 
Indian education, to provide a technical amendment, and for 
other purposes, includes secondary education provisions.
    S. 919, to modify and reauthorize the Child Abuse and 
Prevention Treatment Act, and for other purposes. This bill 
under the jurisdiction of the Committee was held at the Desk 
before passing the House.
    S. 1124, ``National Defense Authorization Act for Fiscal 
Year 1996'', includes Impact Aid provisions.
    S. 2183, to make technical corrections to the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996, 
includes technical correction to welfare provisions.
    H.Res. 400, approving regulations to implement provisions 
of the Congressional Accountability Act of 1995 (P.L. 104-1) 
with respect to employing offices and covered employees of the 
House of Representatives.
    H.Res. 401, directing the Office of Compliance to provide 
educational assistance to employing offices of the House of 
Representatives regarding compliance with the Congressional 
Accountability Act of 1995 (P.L. 104-1) and requiring employing 
offices of the House of Representatives to obtain prior 
approval of the chairman and ranking minority party member of 
the Committee on House Oversight of the House of 
Representatives of the amount of any settlement payments made 
under such Act.
    S.Con.Res. 51, to provide for the approval of final 
regulations that are applicable to employing offices that are 
not employing offices of the House of Representatives or the 
Senate, and to covered employees who are not employees of the 
House of Representatives or the Senate, and that were issued by 
the Office of Compliance on January 22, 1996, and for other 
purposes.

          h. legislation ordered reported from full committee

    H.R. 123, ``Bill Emerson English Language Empowerment Act 
of 1996''.
    H.R. 743, ``Teamwork for Employers and Managers Act of 
1995''.
    H.R. 849, ``Age Discrimination in Employment Amendments of 
1995''.
    H.R. 995, ``ERISA Targeted Health Insurance Reform Act of 
1995''.
    H.R. 999, ``Welfare Reform Consolidation Act of 1995''.
    H.R. 1114, to authorize minors who are under the child 
labor provisions of the Fair Labor Standards Act of 1938 and 
who are under 18 years of age to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards.
    H.R. 1176, to nullify an executive order that prohibits 
Federal contracts with companies that hire permanent 
replacements for striking employees.
    H.R. 1225, ``Court Reporter Fair Labor Amendments of 
1995''.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles.
    H.R. 1557, ``Arts, Humanities, and Museum Services 
Amendments of 1995''.
    H.R. 1594, to place restrictions on the promotion by the 
Department of Labor and other Federal agencies and 
instrumentalities of economically targeted investments in 
connection with employee benefit plans.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 1715, respecting the relationship between workers' 
compensation benefits and the benefits available under the 
Migrant and Seasonal Agricultural Worker Protection Act.
    H.R. 1720, ``Privatization Act of 1995''.
    H.R. 2066, ``Healthy Meals for Children Act''.
    H.R. 2391, ``Working Families Flexibility Act of 1996''.
    H.R. 2428, to encourage the donation of food and grocery 
products to nonprofit organizations for distribution to needy 
individuals by giving the Model Good Samaritan Food Donation 
Act the full force and effect of law.
    H.R. 2570, ``Older Americans Amendments of 1995''.
    H.R. 3049, to amend section 1505 of the Higher Education 
Act of 1965 to provide for the continuity if the Board of 
Trustees of the Institute of American Indian and Alaska Native 
Culture and Arts Development.
    H.R. 3055, to amend section 326 of the higher Education Act 
of 1965 to permit continued participation by Historically Black 
Graduate Professional Schools it he grant program authorized by 
that section.
    H.R. 3268, ``IDEA Improvement Act of 1996''.
    H.R. 3269, ``Impact Aid Technical Amendments Act of 1996''.
    H.R. 3863, ``Student Debt Reduction Act of 1996''.
    H.R. 3876, ``Juvenile Crime control and Delinquency 
Prevention Act of 1996''.
    H.Con.Res. 470, expressing the sense of the Congress that 
the Department of Education should play a more active role in 
monitoring and enforcing compliance with the provisions of the 
Higher Education Act of 1965 related to campus crime.

                         I. Legislation Vetoed

    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''.
    H.R. 743, ``Teamwork for Employees and Managers Act of 
1995''.

    Legislation Considered at Full Committee and Not Reported From 
                              Subcommittee

                    A. Legislation Enacted into Law

    P.L. 104-49 (H.R. 1715), respecting the relationship 
between workers' compensation benefits and the benefits 
available under the Migrant and Seasonal Agricultural Worker 
Protection Act.
    P.L. 104-141 (H.R. 3055), to amend section 326 of the 
Higher Education Act of 1965 to permit continued participation 
by Historically Black Graduate Professional Schools in the 
grant program authorized by that section.
    P.L. 104-272 (H.R. 4167), ``Professional Boxing Safety Act 
of 1996''.
    P.L. 104-331 (H.R. 3452), ``Presidential and Executive 
Office Accountability Act''.

           B. Legislation Enacted as Part of Another Measure

    H.R. 1, ``Congressional Accountability Act of 1995''. 
Provisions of the bill were included in S. 2 and enacted as 
P.L. 104-1.
    H.R. 4, ``Personal Responsibility Act of 1995''. Provisions 
of the bill were included in H.R. 3734 and enacted as P.L. 104-
193.
    H.R. 999, ``Welfare Reform Consolidation Act of 1995''. 
Incorporated into H.R. 4 and provisions of the bill were 
included in H.R. 3734 and enacted as P.L. 104-193.
    H.R. 1720, ``Privatization Act of 1995''. Provisions of the 
bill were included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 2202, ``Immigration in the National Interest Act of 
1995'', was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 3829, ``Welfare Reform Reconciliation Act of 1996'', 
considered as original text of H.R. 3734 and enacted as P.L. 
104-193.
    H.R. 4282, to amend the National Defense Authorization Act 
for FY 93 to make a technical correction relating the provision 
of DOD assistance to local educational agencies, was included 
in H.R. 3610 and enacted as P.L. 104-208.

                    C. Legislation Passed the House

    H.R. 1, ``Congressional Accountability Act of 1995''.
    H.R. 4, ``Personal Responsibility Act of 1995''.
    H.R. 1045, ``To amend Goals 2000: Educate America Act to 
eliminate the National Education Standards and Improvement 
Council.
    H.R. 1715, respecting the relationship between workers' 
compensation benefits and the benefits available under the 
Migrant and Seasonal Agricultural Worker Protection Act.
    H.R. 1720, ``Privatization Act of 1995''.
    H.R. 2202, ``Immigration in the National Interest Act of 
1995''.
    H.R. 3049, to amend section 1505 of the Higher Education 
Act of 1965 to provide for the continuity of the Board of 
Trustees of the Institute of American Indian and Alaska Native 
Culture and Arts Development.
    H.R. 3055, to amend section 326 of the Higher Education Act 
of 1965 to permit continued participation by Historically Black 
Graduate Professional Schools in the grant program authorized 
by that section.
    H.R. 3452, ``Presidential and Executive Office 
Accountability Act''.
    H.R. 3863, ``Student Debt Reduction Act of 1996''.
    H.R. 4134, to amend the Immigration and Nationality Act to 
authorize States to deny public education benefits to aliens 
not lawfully present in the United States who are not enrolled 
in public schools during the period beginning September, 1, 
1996, and ending July 1, 1997.
    H.R. 4167, ``Professional Boxing Safety Act of 1996''.
    H.R. 4282, to amend the National Defense Authorization Act 
for FY 93 to make a technical correction relating to the 
provision of the Department of Defense Assistance to local 
educational agencies.
    H.Con.Res. 123, to provide for the provisional approval of 
regulations applicable to certain covered employing offices and 
covered employees and to be issued by the Office of Compliance 
before January 23, 1996.
    H.Con.Res. 207, approving certain regulations to implement 
provisions of the Congressional Accountability Act of 1995 
relating to labor-management relations with respect to covered 
employees, other than employees of the House of Representatives 
and employees of the Senate, and for other purposes.
    H.Res. 311, to provide for the provisional approval of 
regulations applicable to the House of Representatives and 
employees of the House of Representatives and to be issued by 
the Office of Compliance before January 23, 1996.
    H.Res. 470, expressing the sense of the Congress that the 
Department of Education should play a more active role in 
monitoring and enforcing compliance with the provisions of the 
Higher Education Act of 1965 relating to crime.
    H.Res. 504, approving certain regulations to implement 
provisions of the Congressional Accountability Act of 1995 
relating to labor-management relations with respect to 
employing offices and covered employees of the House of 
Representatives, and for other purposes.

           D. Legislation Passed the House in Another Measure

    H.R. 1, ``Congressional Accountability Act of 1995''. 
Provisions of the bill passed the House in S. 2.
    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''. Provisions of the bill passed the House in H.R. 
2491.
    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''. Provisions of the bill passed the House in H.R. 
3734.
    H.R. 999, ``Welfare Reform Consolidation Act of 1995'', 
passed the House in H.R. 4.
    H.R. 1157, ``Welfare Transformation Act of 1995'', passed 
the House in H.R. 4.
    H.R. 1214, ``Personal Responsibility Act of 1995'', passed 
the House as original text of H.R. 4.
    H.R. 1720, ``Privatization Act of 1995'', passed the House 
in S. 1972.
    H.R. 1720, ``Privatization Act of 1995'', passed the House 
in H.R. 1617.
    H.R. 2517, ``Seven-Year Balanced Budget Reconciliation Act 
of 1995'', passed the House as text of H.R. 2491.
    H.R. 3829, ``Welfare Reform Reconciliation Act of 1996'', 
passed the House as original text of H.R. 3734.
    H.R. 3863, ``Student Debt Reduction Act of 1996'', passed 
the House in S. 1972.

                   E. Legislation with Filed Reports

    H.R. 999 (H.Rept. 104-75, Pt. 1), ``Welfare Reform 
Consolidation Act of 1995''.
    H.R. 1176 (H.Rept. 104-163), to nullify an executive order 
that prohibits Federal contracts with companies that hire 
permanent replacements for striking employees.
    H.R. 1557 (H.Rept. 104-170), ``Arts, Humanities, and Museum 
Services Amendments of 1995''.
    H.R. 1720 (H.Rept. 104-153), ``Privatization Act of 1995''.
    H.R. 3049 (H.Rept. 104-505), to amend section 1505 of the 
Higher Education Act of 1965 to provide for the continuity of 
the Board of Trustees of the Institute of American Indian and 
Alaska Native Culture and Arts Development.
    H.R. 3055 (H.Rept. 104-504), to amend section 326 of the 
higher Education Act of 1965 to permit continued participation 
by Historically Black Graduate Professional Schools in the 
grant program authorized by that section.
    H.R. 3863 (H.Rept. 104-775), ``Student Debt Reduction Act 
of 1996''.
    H.Con.Res. 470 (H.Rept. 104-776), expressing the sense of 
the Congress that the Department of Education should play a 
more active role in monitoring and enforcing compliance with 
the provisions of the Higher Education Act of 1965 related to 
campus crime.

          F. Legislation Ordered Reported from Full Committee

    H.R. 999, ``Welfare Reform Consolidation Act of 1995''.
    H.R. 1176, to nullify an executive order that prohibits 
Federal contracts with companies that hire permanent 
replacements for striking employees.
    H.R. 1557, ``Arts, Humanities, and Museum Services 
Amendments of 1995''.
    H.R. 1715, respecting the relationship between workers' 
compensation benefits and the benefits available under the 
Migrant and Seasonal Agricultural Worker Protection Act.
    H.R. 1720, ``Privatization Act of 1995''.
    H.R. 3049, to amend section 1505 of the Higher Education 
Act of 1965 to provide for the continuity of the Board of 
Trustees of the Institute of American Indian and Alaska Native 
Culture and Arts Development.
    H.R. 3055, to amend section 326 of the higher Education Act 
of 1965 to permit continued participation by Historically Black 
Graduate Professional Schools in the grant program authorized 
by that section.
    H.R. 3863, ``Student Debt Reduction Act of 1996''.
    H. Con. Res. 470, expressing the sense of the Congress that 
the Department of Education should play a more active role in 
monitoring and enforcing compliance with the provisions of the 
Higher Education Act of 1965 related to campus crime.

                         G. Legislation Vetoed

    H.R. 4, ``Personal Responsibility and Work Opportunity Act 
of 1995''.

 H. STATISTICS ON BILLS CONSIDERED AT FULL COMMITTEE AND NOT REPORTED 
                           FROM SUBCOMMITTEE

Total Number of Bills Considered at Full Committee and Not 
    Reported from Subcommittee....................................    48
Total Number of Bills Ordered Reported from Full Committee........     9
Total Number of Filed Reports on Bills............................     8
Total Number of Bills Passed the House............................    18
Total Number of Bills Passed the House in Another Measure.........    11
Total Number of Bills Enacted into Law............................     4
Total Number of Bills Enacted as Part of Another Measure..........     7
Total Number of Bills Vetoed......................................     1

   V. COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES STATISTICS

Total Number of Bills and Resolutions Referred....................   437
Total Number of Hearings..........................................    14
    Field.........................................................     2
    Joint with Other Committees...................................     2
Total Number of Full Committee Mark-Up Sessions...................    21
Total Number of Bills Ordered Reported from Full Committee........    26
Total Number of Filed Reports on Bills............................    25
Total Number of Bills Passed the House............................    37
Total Number of Bills Passed the House in Another Measure.........    20
Total Number of Bills Enacted into Law............................    10
Total Number of Bills Enacted as Part of Another Measure..........    18
Total Number of Bills Vetoed......................................     2

              SUBCOMMITTEE ON EMPLOYER-EMPLOYEE RELATIONS

                        I. Summary of Activities

               A. ERISA TARGETED HEALTH INSURANCE REFORM

    In the 104th Congress, the Committee initiated the 
legislative debate leading to the enactment of incremental 
health insurance reform.
    On February 14, 1995, the Subcommittee on Employer-Employee 
Relations set the stage for ERISA-based insurance reform by 
holding hearings on ``The ERISA Title I Framework: A 20-year 
Success Story.'' On February 21, 1995, the ERISA Targeted 
Health Insurance Reform Act of 1995 (H.R.995) was introduced by 
Representatives Fawell, Goodling, Armey, and other Members. 
This bipartisan legislation was cosponsored by 51 Members of 
the House of Representatives. Legislation addressing reforms in 
the individual health insurance market, the Targeted Individual 
Health Insurance Reform Act of 1995, was introduced on the same 
date. During Subcommittee hearings on the two bills, held on 
March 10 and March 28, 1995, witnesses testified that the 
preservation and expansion of ERISA and its preemption 
framework would be a critical step on the road to significant 
health insurance reform.
    On March 6, 1996, the Committee adopted an amendment in the 
nature of a substitute to H.R. 995 offered by Chairman Fawell 
and ordered the bill reported. The ERISA Targeted Health 
Insurance Reform Act of 1996 was reported to the House on March 
25, 1996 (H. Rept. 104-498). The Committee bill served as the 
genesis for the ERISA-based reforms contained in the Health 
Coverage Availability and Affordability Act, H.R. 3103, as 
passed by the House on March 28, 1996.
    The provisions in the conference report (H. Rept. 104-736) 
relating to portability and health insurance accessibility are 
structured in a manner similar to those in the House passed 
bill and the ERISA Targeted Health Insurance Reform legislation 
originally reported by the Committee. Under the newly enacted 
portability protections, employees can no longer be told that 
their plan will not cover them because of a preexisting medical 
condition when they are continuously insured. The employees of 
small employers can no longer be told that their health 
coverage has been canceled by an insurer because of a costly 
illness. Small employers can no longer be told by insurers that 
health insurance is not available to their employees because of 
the risks of their jobs or their previous claims experience. In 
sum, employees will no longer have to fear, when they leave 
their job or take a new job, that they or their family members 
will lose access to health insurance coverage because of a 
preexisting medical condition.
    Of particular note is the ERISA-based structure of the 
final legislation (the Health Insurance Portability and 
Accountability Act of 1996, P.L. 104-191). The key components 
of the group-to-group portability provisions--restrictions on 
preexisting-condition exclusions, special enrollment rules and 
nondiscrimination on the basis of an individual's health 
status--are made applicable to ``group health plans'' and to 
``health insurance issuers offering group health insurance 
coverage in connection with a group health plan'' under a new 
Part 7 of ERISA Title I. Identical provisions under sections 
2701 and 2702 of the Public Health Service Act are made 
applicable only to group health plans which are non-federal 
governmental plans and to health insurance issuers in 
connection with group health plans (but not to group health 
plans covered under ERISA, even if such a group health plan is 
a multiple employer welfare arrangement). Identical provisions 
under sections 9801-9803 of the Internal Revenue Code are made 
applicable only to group health plans (including church plans) 
and not to health insurance issuers. Section 104 of the Act 
ensures coordination by means of an interagency memorandum of 
understanding (MOU) which requires that regulations, rulings 
and interpretations issued by the different agencies on the 
same subject matter must be administered so as to have the same 
effect at all times. Likewise a coordinated enforcement 
strategy must be maintained under the MOU to prevent 
duplicative enforcement and to assign priorities in 
enforcement. For example, the Committee expects that any 
information relating to a potential violation of the Act by a 
health insurance issuer which comes to the attention of the 
Department of Labor or the Internal Revenue Service will be 
transmitted to the Department of Health and Human Services 
(HHS) for a determination under section 2722(a)(2) as to 
whether a state has failed to substantially enforce the 
particular provision of the Act (amending the Public Health 
Service Act) as it relates to the health insurance issuer. Only 
if the state involved has failed to substantially enforce the 
federal law with respect to the provision violated will the 
Secretary of HHS invoke the federal enforcement provisions 
under section 2722(b).
    The Health Insurance Portability and Accountability Act, 
under section 704 of ERISA and section 2723 of the Public 
Health Service Act, also reinforces the broad preemption 
framework with respect to employee benefit plans (i.e. group 
health plans) which characterizes ERISA section 514. In 
particular, the new provisions of section 701 of ERISA and 
section 2701 of the Public Health Service Act as they relate to 
health insurance coverage offered by a health insurance issuer 
in connection with a group health plan supersede any provision 
of state law relating to the preexisting condition rules under 
such sections, except to the extent that such state law 
specifically provides for one of the exceptions listed under 
paragraph (b)(2). Therefore, in general, the above referenced 
portability/preexisting condition rules and certification/
notice requirements will apply on a uniform basis to all group 
health plans and related health insurance coverage, if any. The 
only exception to this general rule occurs with respect to 
health insurance coverage offered by a health insurance issuer 
in a state which specifically provides for one or more of the 
exceptions listed in paragraph (b)(2).
    The Committee also takes note that by omitting from the 
conference report the ERISA small business pooling provisions 
included under Subtitle C of the House bill, this Congress has 
missed an important opportunity to extend more affordable 
coverage to the millions of employees and their dependents who 
today do not have health insurance coverage. These provisions 
would have built upon the ERISA cornerstone of this nation's 
employee benefits law to allow employers, particularly small 
employers, to achieve economies of scale by joining together to 
form either self-insured or fully-insured health plans. The 
number of uninsured workers will be a continual reminder that 
this mechanism for expanded health coverage is needed and 
should be included at the earliest possible time. Nonetheless, 
the enacted legislation does preserve the ERISA preemption 
cornerstone which has fueled the marketplace dynamics that have 
recently reduced health insurance cost inflation, at least in 
the large group market. A principle also reflected in new ERISA 
section 704 is the need for national uniformity regarding the 
procedures and reporting required to make the portability 
mechanism work for all employees who participate in employee 
health benefit plans covered under the legislation.

                         B. PENSION PROTECTION

    The Subcommittee held several hearings focusing on 
protecting workers pensions. On June 15, 1995, the Subcommittee 
held a hearing on H.R. 1594, the ``Pension Protection Act of 
1995.'' The purpose of H.R. 1594 was to prevent the Department 
of Labor, guardian of fiduciary standards for the nation's 
pension plans, or any other federal agency from promoting so-
called economically targeted investments (ETIs) to employee 
benefit plans. ETIs are investments in an array of so-called 
``socially beneficial'' projects such as public housing 
construction or infrastructure building, rather than in those 
selected exclusively to provide a financially sound return for 
pensioners as required by federal pension law. The Department 
of Labor is promoting such politically targeted investments 
through a $1.2 million taxpayer-funded clearinghouse and 
through issuance of an Interpretive Bulletin--even though it 
acknowledges that these investments ``require a longer time to 
generate significant investment returns,'' are ``less liquid,'' 
and require more expertise to evaluate. H.R. 1594 would abolish 
the clearinghouse and repeal the Interpretive Bulletin. On July 
13, 1995, the Subcommittee approved H.R. 1594; the full 
committee favorably reported the bill on July 20, 1995; and on 
September 12, 1995, the House passed it by a vote of 239-179.
    In June 1996, the Subcommittee held two oversight hearings 
on promoting the expansion of pensions for American workers. 
The hearings focused on how after more than two decades since 
the passage of the landmark Employee Retirement Income Security 
Act (ERISA), Congress must reduce any barriers hindering its 
goal of securing adequate retirement income for American 
workers and their families. The hearings addressed the ways in 
which the Committee, in future legislation, can increase access 
to pension plans by further simplifying regulations which today 
make it difficult for many employers to offer pensions. The 
Subcommittee is committed to beginning the groundwork for 
pension expansion and simplification now, before baby boomers 
overwhelm our retirement system.

                              C. TEAM ACT

    One of the issues upon which the Subcommittee on Employer-
Employee Relations placed its highest priority was H.R. 743, 
the Teamwork for Employees and Managers (TEAM) Act, which would 
clarify the legality of a wide range of employee involvement 
programs. The Subcommittee was motivated by the recognition 
that the workplace of today is simply not the same as the 
workplace that was prevalent in the America of the 1930's when 
the National Labor Relations Act (NLRA) was enacted. Employers 
and employees in nonunion workplaces who want to work together 
to confront and address the numerous issues that arise in any 
employment relationship (e.g. safety and health concerns, 
efficiency/productivity issues, scheduling, benefits, etc.) 
were finding their cooperation thwarted by broad 
interpretations of labor laws a half century old. The 
Subcommittee believes that federal labor law should facilitate 
the desire of employees and employers to create mechanisms in 
the workplace--be they formal or informal, permanent or 
temporary--to foster an exchange of concerns, problems, 
suggestions and solutions to make the employment experience 
more satisfying and productive for all parties.
    The Subcommittee heard from many employers and business 
owners that they have either suspended or decided against 
initiating any employer-employee involvement or cooperative 
management programs because of a concern about how the National 
Labor Relations Board and the courts would judge the legality 
of such programs. Employees who have enjoyed having a voice in 
how their workplaces are operated and structured have also 
indicated that they are concerned that legal questions 
surrounding the legality of employer-employee cooperation will 
force them back into a situation where, in their words, they 
will have to ``check their brains at the door.''
    This nation's labor law must be relevant to the employer-
employee relationships of the twenty-first century. The 
Subcommittee felt strongly that the amendments to the NLRA 
contemplated by the TEAM Act were crucial and that the bill 
would pose no threat to the well-protected right of employees 
to select representatives of their own choosing to act as their 
exclusive bargaining agent. Even with the changes to the NLRA 
proposed in H.R. 743, an employee involvement structure may not 
engage in collective bargaining nor may it act as the exclusive 
representative of employees. The prohibitions in the NLRA 
outlawing interference with employees' attempts to form a union 
and preventing employers from avoiding bargaining obligations 
by directly dealing with employees remain unaffected by the 
TEAM Act.
    Although H.R. 743 was unfortunately vetoed by President 
Clinton after passage by both the House and the Senate, the 
Subcommittee remains committed to the legislation as it makes 
clear that employers can work together with their employees to 
confront and solve the myriad problems and issues that arise in 
a workplace. To allow otherwise would stand in the way of 
cutting edge human resource management that offers business the 
opportunity to make an investment in the human potential of the 
American workforce that will yield untold dividends for this 
nation.

                    D. ADEA PUBLIC SAFETY EXEMPTION

    Another issue to which the Subcommittee on Employer-
Employee Relations devoted early attention was the restoration 
of the public safety exemption to the Age Discrimination in 
Employment Act of 1967 (ADEA). Chairman Fawell introduced 
legislation (H.R. 849) to restore this exemption, which expired 
on December 31, 1993. The legislation would allow police and 
fire departments and correctional institutions to utilize 
maximum hiring ages and early retirement ages as an element of 
their overall personnel policies. The restoration of the public 
safety exemption was sought by management and labor alike in 
the public safety arena.
    Although the Subcommittee believes strongly that the use of 
an age requirement as a qualification for employment is rarely 
justified, the public safety arena presents one of the very 
limited exceptions where the need to perform at peak physical 
and mental conditioning is critical and the natural effects of 
the aging process cannot be discounted. Police and firefighters 
have the safety and well-being of not only their fellow 
officers, but the general public as well, in their hands, and 
the Subcommittee simply was not prepared to tolerate the risk 
presented by the possibility of sudden incapacitation or slowed 
reflexes.
    The Subcommittee held a hearing on the need for the public 
safety exemption under the ADEA, and the testimony of 
firefighting and law enforcement organizations and local 
government was compelling. A representative of the 
International Association of Firefighters testified that ``the 
most important reason that public safety occupations are an 
exception to the general rule against age-based employment 
criteria is simply that human lives are at stake.'' Both the 
firefighters and police officers presented persuasive testimony 
that state and local governments must ensure a physically fit 
and fully qualified workforce and that there are no adequate 
physical tests available to enable them to do so without the 
use of age criteria.
    H.R. 849, which enjoyed overwhelming bipartisan support, 
was one of the first pieces of legislation considered by the 
Committee on Economic and Educational Opportunities and, by 
voice vote, passed the House of Representatives on March 28, 
1995. The Subcommittee was gratified that the Congress took the 
critical steps necessary to ensure that H.R. 849 was finally 
enacted by including the legislation in the omnibus 
appropriations bill, P.L. 104-208, signed by President Clinton. 
The public safety exemption under the ADEA drew the proper 
balance between protecting the employment rights of older 
Americans and protecting the safety needs of all Americans, and 
gave police and fire departments the necessary flexibility to 
establish personnel policies that are suited to the demands of 
public safety occupations.

                    E. THE WORKER RIGHT TO KNOW ACT

    The Worker Right to Know Act, H.R. 3580, was introduced by 
Chairman Harris Fawell on June 5, 1996. The Act implements and 
strengthens workers' rights, created by the U.S. Supreme 
Court's 1988 decision in Beck v. Communications Workers of 
America, to object to the payment of union dues or fees for any 
activities not related to collective bargaining, contract 
administration or grievance adjustment necessary to performing 
the duties of exclusive representation.
    The Act would require unions to disclose to its memberships 
exactly where funds were going, and amends the Labor-Management 
Reporting and Disclosure Act to give all employees paying dues 
to a union greater access to the union's financial records.
    In light of the serious undermining of workers' right to 
know, and have a say in, where their hard-earned dollars are 
sent, the Subcommittee on Employer-Employee Relations held two 
hearings in Washington, DC, in April and June 1996, to examine 
in detail the effects of this unfairness and to fashion an 
effective response which would uphold the rights of workers.
    The Subcommittee's two hearings on H.R. 3580--held April 18 
and June 19, 1996 (both hearings contained in Serial No. 104-
66)--demonstrated a strong need for legislation protecting 
workers' rights. Eighteen witnesses' testimony, including eight 
current or former union members, created a compelling case for 
the appropriateness of simply asking workers for their 
permission before spending their money.
    Witnesses' direct experience confirmed that rank-and-file 
union members are having their dues taken by union leadership 
and spent on political activities with which many members 
disagree. Testimony showed that most workers are unaware that 
they have a right to a refund on that portion of dues used for 
purposes unrelated to legitimate union functions, and that 
those who are aware of this right--and seek to exercise it--
often face union delay and intimidation, and may become 
outcasts within the union when attempting to secure rebates.

             f. reform of the national labor relations act

    The Subcommittee initiated a broad review of the National 
Labor Relations Act (NLRA) and of the National Labor Relations 
Board, the federal agency charged with administering and 
enforcing the NLRA. Upon completion of its review, the 
Subcommittee held hearings and considered several bills 
intended to address problems or areas of concern the 
Subcommittee had identified with respect to the both the NLRA 
and the NLRB.
    The Subcommittee reviewed the union organizing tactic known 
as ``salting'', in which union organizers seek or gain 
employment with a non-union employer for the sole purpose of 
coercing that employer into signing a collective bargaining 
agreement. Hearings were held on union ``salting'' in 
conjunction with the Subcommittee on Oversight and 
Investigations on July 12, 1995 and October 31, 1995. On March 
29, 1996, Chairman Fawell introduced legislation to address 
abusive ``salting'' practices, H.R. 3211, ``The Truth in 
Employment Act of 1996.'' The Committee on Economic and 
Educational Opportunities held a joint field hearing on the 
bill with the Committee on Small Business on April 12, 1996 in 
Overland Park, Kansas.
    The Subcommittee also reviewed the NLRB's increased use of 
10(j) injunctions--referring to that provision of the NLRA that 
allows the NLRB, upon issuance of an Unfair Labor Practice 
complaint, to seek injunctive relief in the U.S. District 
Courts. A hearing on the Board's use of 10(j) injunctions was 
held on September 27, 1995; and, on March 14, 1996, Chairman 
Fawell introduced H.R. 3091, the Injunctive Relief Amendments 
Act of 1996.
    Finally, the Subcommittee reviewed the current state of the 
law regarding access to an employers' property within the 
context of the National Labor Relations Act. On October 18, 
1995, Chairman Hoekstra introduced legislation, H.R. 2497, to 
address questions regarding a union's access to an employer's 
property, vis-a-vis the access granted to a charitable, civic 
or religious organization. The Committee on Economic and 
Educational Opportunities held a hearing on the bill on 
February 7, 1996.

       g. group preferences/affirmative action/equal opportunity

    The Subcommittee conducted an important review of the role 
of affirmative action in the employment context. In particular, 
hearings focused on examining the Office of Federal Contract 
Compliance Programs (OFCCP), which administers mandatory 
written affirmative action programs for federal contractors, 
and the Executive Order it enforces. The Subcommittee held the 
following hearings: oversight hearings on affirmative action in 
employment on March 24 and May 2, 1995; oversight hearing on 
Equal Employment Opportunity Commission (EEOC) administrative 
reforms on May 23, 1995; oversight hearing on Executive Order 
11246 and its implementing regulations, as administered by the 
Office of Federal Contract Compliance Programs (OFCCP) on June 
21, 1995; and legislative hearing on H.R. 2128, ``The Equal 
Opportunity Act of 1995,'' and the role of the OFCCP on 
February 29, 1996.

                 II. Meetings Held by the Subcommittee

104th Congress, First Session

    January 24, 1995--Oversight hearing on the Age 
Discrimination in Employment Act, public safety exemption.
    February 8, 1995--Oversight hearing on removing impediments 
to employee participation/electromation.
    February 14, 1995--Oversight hearing on health care reform.
    February 16, 1995--Mark-up of H.R. 849, ``Age 
Discrimination in Employment Amendments of 1995''.
    March 7, 1995--Mark-up of H.R. 743, ``Teamwork for 
Employees and Employers Managers Act''.
    March 10, 1995--Hearing on H.R. 995, ERISA Targeted Health 
Insurance Reform Act of 1995.
    March 24, 1995--Oversight hearing on affirmative action in 
employment.
    March 28, 1995--Hearing on H.R. 995, ERISA Targeted Health 
Insurance Reform Act of 1995.
    Hearing on H.R. 996, Targeted Individual Health Insurance 
Reform Act of 1995.
    May 2, 1995--Oversight hearing on affirmative action in 
employment.
    May 23, 1995--Oversight hearing on the Equal Employment 
Opportunity Commission (EEOC) administrative reforms/case 
processing.
    June 15, 1995--Hearing on H.R. 1594, Economically Targeted 
Investments (ETI's).
    June 21, 1995--Oversight hearing on Executive Order 11246 
and its implementing regulations, as administered by the Office 
of Federal Contract Compliance Programs (OFCCP).
    July 13, 1995--Mark-up of H.R. 1594, to place restrictions 
on the promotion by the Department of Labor and other Federal 
agencies and instrumentalities of economically targeted 
investments in connection with employee benefit plans.
    September 27, 1995--Oversight hearing on National Labor 
Relations Board (NLRB) reform.

104th Congress, Second Session

    February 29, 1996--Hearing on H.R. 2128, the Equal 
Opportunity Act of 1995; and the Office of Federal Contract 
Compliance Programs (OFCCP).
    April 18, 1996--Oversight hearing on mandatory assessment 
of union dues.
    June 6, 1996--Oversight hearings on promoting expansion of 
pensions for American workers.
    June 19, 1996--Hearing on H.R. 3580, Worker Right to Know 
Act.
    June 26, 1996--Oversight hearings on promoting expansion of 
pensions for American workers.

                      III. Legislative Activities

                    a. legislation enacted into law

    P.L. 104-191 (H.R. 3103), ``Health Insurance Portability 
and Accountability Act of 1996''.

           b. legislation enacted as part of another measure

    H.R. 849, ``Age Discrimination in Employment Amendments'', 
was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 995, ``ERISA Targeted Health Insurance Reform Act of 
1995''. Provisions of the bill were included in H.R. 3103 and 
enacted as P.L. 104-191.
    H.R. 3160, ``Health Coverage Availability and Affordability 
Act of 1996''. Provisions of the bill were included in H.R. 
3103 and enacted as P.L. 104-191.

                    c. legislation passed the house

    H.R. 849, ``Age Discrimination in Employment Amendments of 
1995''.
    H.R. 743, ``Teamwork for Employers and Managers Act of 
1995''.
    H.R. 1594, to place restrictions on the promotion by the 
Department of Labor and other Federal agencies and 
instrumentalities of economically targeted investments in 
connection with employee benefit plans.
    H.R. 2092, ``Private Security Officer Quality Assurance Act 
of 1995''.
    H.R. 3103, ``Health Insurance Portability and 
Accountability Act of 1996''.

           d. legislation passed the house in another measure

    H.R. 995, ``ERISA Targeted Health Insurance Reform Act of 
1995''. Provisions of the bill passed the House in H.R. 3103.
    H.R. 3160, ``Health Coverage Availability and Affordability 
Act of 1996''. Provisions of the bill passed the House in H.R. 
3103.

                   e. legislation with filed reports

    H.R. 743 (H.Rept. 104-248), ``Teamwork for Employers and 
Managers Act of 1995''.
    H.R. 995 (H.Rept. 104-498, Pt. 1), ``ERISA Targeted Health 
Insurance Reform Act of 1995''.
    H.R. 1594 (H.Rept. 104-238), to place restrictions on the 
promotion by the Departments of Labor and other Federal 
agencies and instrumentalities of economically targeted 
investments in connection with employee benefit plans.

          f. legislation ordered reported from full committee

    H.R. 849, ``Age Discrimination in Employment Amendments of 
1995''.
    H.R. 743, ``Teamwork for Employers and Managers Act of 
1995''.
    H.R. 995, ``ERISA Targeted Health Insurance Reform Act of 
1995''.
    H.R. 1594, to place restrictions on the promotion by the 
Department of Labor and other Federal agencies and 
instrumentalities of economically targeted investments in 
connection with employee benefit plans.

               g. legislation reported from subcommittee

    H.R. 743, ``Teamwork for Employers and Managers Act of 
1995''.
    H.R. 849, ``Age Discrimination in Employment Amendments of 
1995''.
    H.R. 1594, to place restrictions on the promotion by the 
Department of Labor and other Federal agencies and 
instrumentalities of economically targeted investments in 
connection with employee benefit plans.

              h. legislation discharged from subcommittee

    H.R. 995, ERISA Targeted Health Insurance Reform Act of 
1995''.

                         i. legislation vetoed

    H.R. 743, ``Teamwork for Employees and Managers Act of 
1995''.

                      IV. Subcommittee Statistics

Total Number of Bills and Resolutions Referred to Subcommittee....   130
Total Number of Bills Discharged from Subcommittee................     1
Total Number of Hearings..........................................    17
    Field.........................................................     0
    Joint with Other Committees...................................     0
Total Number of Subcommittee Mark-Up Sessions.....................     3
Total Number of Bills Reported from Subcommittee..................     3
Total Number of Bills Ordered Reported from Full Committee........     4
Total Number of Filed Reports on Bills............................     3
Total Number of Bills Passed the House............................     5
Total Number of Bills Passed the House in Another Measure.........     2
Total Number of Bills Enacted into Law............................     1
Total Number of Bills Enacted as Part of Another Measure..........     3
Total Number of Bills Vetoed......................................     1

                 SUBCOMMITTEE ON WORKFORCE PROTECTIONS

                        I. Summary of Activities

                a. the fair labor standards act of 1938

    During the 104th Congress, the Subcommittee on Workforce 
Protections undertook a series of oversight hearings on the 
Fair Labor Standards Act of 1938. The overall theme of the six 
hearings was whether the Act, along with its many underlying 
regulations, needs to be updated to reflect the realities of 
the modern workforce and to clarify areas where the law 
reflects uncertainty.

The Working Families Flexibility Act

    The Subcommittee on Workforce Protections held an oversight 
hearing on June 8, 1995 on amending the Fair Labor Standards 
Act (FLSA) to provide private sector employers with the option 
of allowing employees to choose to take compensatory time off 
in lieu of overtime pay, an option which federal, state, and 
local governments have had for many years. Witnesses testified 
at the hearing about the need for an amendment to the FLSA to 
provide covered or ``non-exempt'' employees with more 
flexibility regarding compensation and scheduling issues.
    The Fair Labor Standards Act requires generally that hours 
of work by ``non-exempt'' employees beyond 40 hours in a seven-
day period must be compensated at a rate of one-and-a-half 
times the employee's regular rate of pay. Narrow exceptions to 
the so-called ``40-hour work week'' are permitted, under 
section 7 of the FLSA, for employees in a variety of specific 
types and places of employment whose circumstances have led 
Congress, over the years, to enact specific provisions 
regarding maximum hours of work for those types of employment. 
In addition, the overtime pay requirement does not apply to 
``exempt'' employees--``executive, administrative, or 
professional'' employees.
    Payment to private sector employees for overtime hours 
worked must be in the form of cash wages. This is contrary to 
the overtime pay requirement under the FLSA for public sector 
employees. Public agencies may provide compensatory time in 
lieu of overtime compensation, so long as the employee or his 
or her collective bargaining representative has agreed to this 
arrangement and the compensatory time off is given at a rate of 
not less than one and one-half hours for each overtime hour 
worked by the employee.
    On September 21, 1995, Representative Cass Ballenger 
introduced H.R. 2391, the Working Families Flexibility Act. The 
purpose of the legislation is to amend the FLSA to provide 
compensatory time for all employees. A hearing was held by the 
Subcommittee on H.R. 2391 on November 1, 1995. Witnesses 
testified about the changes in the work force and the workplace 
since the 1930s, when the private sector provisions regarding 
overtime pay were written. There is ample support for 
concluding that working men and women today want the option of 
being able to earn compensatory time off rather than cash wages 
for overtime hours worked. A survey conducted in September, 
1995 by Penn Schoen Associates, Inc. found that 75 percent of 
those surveyed favored a proposal to give workers the option of 
time off in lieu of overtime wages.
    The Subcommittee on Workforce Protections favorably 
reported the Working Families Flexibility Act, as amended, on 
December 13, 1995. The Committee on Economic and Educational 
Opportunities favorably reported the bill, as amended, on June 
26, 1996. The amendments to the bill include a number of 
provisions for employees in the private sector which are not 
provided in current law for public sector employees. The 
additional provisions for private sector employees have been 
added in response to concerns which have been raised about the 
possible misuses of allowing employers and employees in the 
private sector to decide on compensatory time in lieu of cash 
compensation.
    Under H.R. 2391, an employer and employee must reach an 
expressed mutual agreement or understanding that overtime 
compensation will be in the form of compensatory time. If 
either party does not so agree, then the overtime pay must be 
in the form of cash compensation. The agreement to use 
compensatory time must be affirmed in a written or otherwise 
verifiable statement prior to the performance of the work for 
which the compensatory time off would be given. Any agreement 
must be entered into ``knowingly and voluntarily'' by the 
employee.
    Private sector employers are prohibited under the bill from 
directly or indirectly intimidating, threatening, coercing or 
attempting to coerce any employee into taking or not taking 
compensatory time in lieu of cash wages. There are appropriate 
penalties in the bill for employers who violate the anti-
coercion provision. An employee who has accrued compensatory 
time may generally use the time whenever he or she so desires. 
The employer may deny the employee's request only if the 
employee's use of the compensatory time would ``unduly 
disrupt'' the operations of the employer. This same standard--
which is used under the Family and Medical Leave Act and under 
the public sector use of compensatory time--is to balance the 
employee's right to make use of compensatory time that has been 
earned and the employer's reasonable needs in operating the 
business. Finally, the bill provides that an employee may 
accrue no more than 240 hours of compensatory time. Any accrued 
compensatory time must be cashed out a minimum of once per year 
or within 30 days of an employee's written request for a cash 
out.
    The Working Families Flexibility Act passed the House, as 
amended, on July 30, 1996, but was not acted on by the Senate 
prior to the adjournment of the 104th Congress.

Court reporters

    On July 11, 1995, the Subcommittee on Workforce Protections 
heard testimony on H.R. 1225, the Court Reporter Fair Labor 
Amendments of 1995. The bill was introduced on March 14, 1995 
by Representative Harris W. Fawell to amend the Fair Labor 
Standards Act to exempt employees who perform certain court 
reporting duties from the overtime time requirements applicable 
to certain public agencies.
    H.R. 1225 was introduced in response to a ruling by the 
Department of Labor which held that court reporters are acting 
as employees of the court when they are preparing transcripts 
for attorneys, litigants and other parties, even though the 
Internal Revenue Service has determined that they are 
independent contractors in this instance. While preparing such 
transcripts, court reporters typically have an agreement with 
their employer to charge a per page rate for preparing 
transcripts for outside parties. In this capacity, they are 
acting as independent contractors, not as employees of the 
court.
    In order to comply with the Department of Labor's ruling, 
many courts were considering changes and some had already made 
changes to their payment structures for official court 
reporters. H.R. 1225, which was supported by court reporters as 
well as state and local government employers, restores the 
payment system of court reporters to what both court reporters 
and state and local courts believed the system was prior to the 
ruling by the Department of Labor.
    H.R. 1225 clarifies that time spent by official court 
reporters preparing transcripts for a per page fee during ``off 
hours'' shall not be considered to be ``hours worked'' for the 
purposes of section 7(a) of the Fair Labor Standards Act. In 
particular, the legislation provides that where court reporters 
are being compensated on a per page basis for transcription 
work performed on the court reporter's own time, the time spent 
on that work need not be counted as hours worked for purposes 
of determining the employer's overtime obligation to that 
reporter.
    The Committee on Economic and Educational Opportunities 
reported H.R. 1225, as amended, on July 20, 1995. The bill was 
then passed, as amended, by the House on the Corrections 
Calendar on August 1, 1995, and by the Senate on August 5, 
1995. The measure was enacted on September 6, 1995, and became 
Public Law 104-26.

Travel time in company vehicles

    On March 14, 1995, Representative Harris W. Fawell 
introduced H.R. 1227, to amend the Portal-to-Portal Act of 1947 
to address the issue of the compensability of time spent by 
employees commuting in company vehicles. The bill was 
introduced in response to an opinion letter issued by the 
Department of Labor on August 5, 1994, which ruled that the 
time spent by an employee traveling from home to the first work 
assignment, or returning home from the last assignment, was 
similar to that of traveling between jobs during the day and 
therefore represented a principal activity, which must be 
compensated. No compensation would be required in cases where 
employees used their own personal vehicles.
    The Department of Labor's opinion letter interfered with 
customary practice in many industries, where employees commute 
directly from home to the job site and use of the employer's 
vehicle for such commuting is a matter of convenience for both 
the employee and the employer. In response to Congressional 
inquiries, the Department of Labor issued a follow-up letter on 
October 19, 1994, suspending enforcement of the opinion letter. 
A revised opinion letter modifying the Department of Labor's 
position was issued on April 3, 1995. The letter held that such 
travel time need not be compensated if: (1) use of the vehicle 
is strictly voluntary and not a condition of employment; (2) 
the vehicle which is used for commuting is the type of vehicle 
which would normally be used for commuting; (3) the employee 
incurs no costs for driving or parking the employer's vehicle; 
and (4) the work sites are within the normal commuting area of 
the employer's establishment.
    On November 1, 1995, the Subcommittee held a hearing on 
H.R. 1227. Witnesses testified about the need for a legislative 
clarification of the intention of the Portal-to-Portal Act with 
regard to employee use of employer-provided vehicles for 
commuting. H.R. 1227 was favorably reported by the Subcommittee 
on Workforce Protections on December 13, 1995. The Committee on 
Economic and Educational Opportunities favorably reported H.R. 
1227 on March 21, 1996.
    The bill, as amended, provides clarification regarding the 
use of an employer-provided vehicle for travel from an 
employee's home to the first work location at the start of the 
workday and from the last work location to the employee's home 
at the end of the workday. Such travel is not considered to be 
part of the employee's principal activities and therefore, the 
time spent in such commuting is not required to be compensated 
under the Fair Labor Standards Act. The limitation applies only 
if the use of the vehicle is within the normal commuting area 
for the employer's business or establishment and the use of the 
employer's vehicle is subject to an agreement between the 
employer and the employee or employee's representative. This 
clarification regarding an employee's ``principal activity or 
activities'' applies as well to activities performed by an 
employee which are incidental to the use of the employer-
provided vehicle for travel by the employee at the beginning 
and end of the workday. The bill does not apply to time spent 
traveling between job sites during the course of the workday.
    H.R. 1227 was passed by the House on May 22, 1996 and was 
subsequently included as part of H.R. 3448, the Small Business 
Job Protection Act. The Senate passed H.R. 3448 on July 9, 
1996, and it was enacted into law (P.L. 104-188) on August 20, 
1996.

Use of paper balers by teenage workers

    On July 11, 1996, the Subcommittee heard testimony on H.R. 
1114, introduced by Representative Thomas W. Ewing which would 
authorize minors who are under the child labor provisions of 
the Fair Labor Standards Act to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards. The Department of Labor's 
regulations under the Fair Labor Standards Act prohibit minors 
under the age of 18 from loading or operating certain power-
driven paper products machines, including paper balers. 
Witnesses testified that while there have been significant 
changes in technology which have resulted in improved safety 
mechanisms on balers, the 30-year old regulation had not been 
updated by the Department of Labor to reflect these changes.
    The Committee on Economic and Educational Opportunities 
reported H.R. 1114, as amended, on July 20, 1995. The bill was 
considered and passed by the House, as amended, on October 24, 
1995 on the Corrections Calendar. The House-passed bill would 
permit 16 and 17 year olds to load (but not operate or unload) 
paper balers and compactors that (1) can not operate while 
being loaded, and (2) meet the most current safety standards of 
the American National Standards Institute (ANSI), a private 
standards-setting organization. In addition, it required that 
the machinery have an on-off switch, that the key be maintained 
in the custody of an adult employee, and that a notice be 
posted on the machine indicating that 16 and 17 year old 
employees are allowed to load but not operate or unload the 
machine.
    The Senate passed H.R. 1114, as amended, on July 16, 1996. 
The final bill, which was enacted on August 6, 1996, and became 
P.L. 104-174, provides, in addition to incorporating the 
protections of the House bill, that the machinery must meet 
either the current ANSI standard, or a future ANSI standard so 
long as the Secretary of Labor certifies that the standard is 
at least as protective of the safety of minors as the current 
ANSI standards. In addition, for two years following enactment, 
employers will be required to report any injuries and 
fatalities which result from contact by an employee under age 
18 during the loading, operating, or unloading of the machine.

Houseparents legislation

    On November 1, 1995, the Subcommittee on Workforce 
Protections held a hearing on H.R. 2531, which was introduced 
on October 25, 1995, by Representative Tim Hutchinson. The 
purpose of the bill is to exempt certain qualified houseparents 
from the minimum wage and overtime requirements of the Fair 
Labor Standards Act.
    Many private, nonprofit, charitable institutions which 
serve neglected or abused children employ individuals as 
houseparents or substitute parents, on a twenty-four hour 
basis. The institutions maintain a family-based environment by 
providing continuous, consistent care to children from homes 
broken by divorce, desertion, death, and separation. Staff who 
function as houseparents live, eat, sleep and enjoy recreation 
in the home with the children under their care. However, as the 
result of the application of the Fair Labor Standards Act to 
houseparents, a number of these institutions have been forced 
to change the method in which they provide care to the children 
who reside in the homes.
    Section 13(b)(24) of the Fair Labor Standards Act excludes 
from overtime certain employees of institutions which operate 
residential schools serving children and youth. In reality, 
there are few individuals, if any, who are able to qualify for 
the current exemption. It fails to recognize the types of 
individuals who are employed as houseparents. There are many 
single individuals who serve ably and are unable to qualify for 
the exemption because they are not married. An individual who 
serves as the substitute parent for children who are from 
broken homes where both parents are living, but no longer 
together, would not qualify for the exemption because only 
orphans or children with at least one parent deceased will meet 
the current law requirement. Finally, many houseparents do not 
qualify because they are employed by institutions which only 
provide residential care, not educational programs, for abused 
or neglected children.
    Witnesses who testified before the Subcommittee hearing 
emphasized that the success of these programs for abused or 
neglected children directly depends upon the institution's 
ability to provide a family-based home environment with 
continuous, consistent care by substitute parents. It is 
apparent that many of these institutions face tremendous 
uncertainty as to whether or not staff functioning as 
houseparents are covered by the Fair Labor Standards Act. 
Furthermore, the absence of clearly-defined guidelines from the 
Department of Labor concerning the treatment of houseparents 
under the Fair Labor Standards Act has resulted in confusion 
and costly litigation for some private, nonprofit institutions 
providing care for children. The present treatment of 
houseparents under the FLSA is an impediment to charitable, 
nonprofit organizations which attempt to provide necessary 
services using a family-based model.
    On December 13, 1995, the Subcommittee on Workforce 
Protections favorably reported H.R. 2531, as amended. The bill, 
which was reported as amended by the Committee on Economic and 
Educational Opportunities on March 21, 1996, would exempt 
individuals employed by private, nonprofit institutions as 
houseparents from the minimum wage and overtime provisions of 
the Fair Labor Standards Act provided that the individual (1) 
receives room and board, without cost, (2) is compensated on an 
annual basis of not less than $8,000 and (3) resides in the 
home with the children for a minimum of 72 hours. The bill was 
not considered by the House of Representatives.

                            B. BOXING SAFETY

    On June 11, 1996, the Subcommittee on Workforce Protections 
held a joint hearing on H.R. 1186, the Professional Boxing 
Safety Act of 1996, with the Commerce Committee's Subcommittee 
on Commerce, Trade, and Hazardous Materials. The hearing 
focused on issues of fraud, health and safety in the sport of 
boxing.
    Most State athletic commissions have differing policies 
with regard to boxing. In one State, boxers, promoters, and 
managers may be required to meet certain standards, while 
another State may have no requirements or safety and health 
standards at all. H.R. 1186, which was introduced by 
Representative Michael G. Oxley establishes minimum health and 
safety requirements for professional boxers and will improve 
the ability of State authorized boxing commissions to properly 
oversee professional boxing matches. H.R. 1186 was jointly 
referred to the Committee on Economic and Educational 
Opportunities and the Committee on Commerce. The bill was 
favorably reported by the Committee on Commerce on September 
18, 1996. The Committee on Economic and Educational 
Opportunities did not further consider the bill, which was 
supported by Members on both sides of the aisle, in order to 
expedite the legislative process. H.R. 4167, identical to H.R. 
1186 as reported by the Committee on Commerce was introduced by 
Representative Pat Williams of Montana and was considered and 
passed by the House in lieu of H.R. 1186. The Senate passed 
H.R. 4167 on September 27, 1996, and the measure was enacted on 
October 9, 1996, as P.L. 104-272.

                                c. osha

    The Occupational Safety and Health Act has been amended 
only once in the 25 years since it was enacted; that one 
amendment was part of a budget bill to raise revenues for the 
federal government through increased penalties. Despite the 
lack of amendment, however, OSHA has been one of the most 
criticized federal agencies. The criticisms have come not only 
from employers and employees, but from policy analysts who have 
studied OSHA's impact and found it to have imposed considerable 
cost with comparatively little benefit to worker safety and 
health.
    Reasons for OSHA's lack of cost effectiveness and examples 
of excessively burdensome regulations were explored during a 
hearing conducted by the Subcommittee on Oversight and 
Investigations shortly after the 104th Congress convened, on 
February 16, 1995. They were further explored in a general 
oversight hearing held by the Subcommittee on Workforce 
Protections, on March 8, 1995, at which both present and past 
OSHA administrators gave their views of why OSHA has not been 
more cost effective in promoting workplace safety and health.
    Legislation to reform Occupational Safety and Health Act 
(H.R. 1834) through reforms of the regulatory process, greater 
balance between consultative and enforcement efforts by OSHA 
personnel, changes to the enforcement process to provide more 
effective targeting at serious health and safety problems, and 
consolidation of federal agencies involved in workplace safety 
and health efforts was considered during several hearings 
conducted by the Subcommittee on Workforce Protections.
    Despite claims by the Clinton Administration that it too 
recognized that OSHA needed to be ``reinvented'' because ``the 
rules are too rigid and the inspections are often adversarial'' 
(Vice President Gore, speaking to the White House Conference on 
Small Business), the President nonetheless declared his 
intention to veto H.R. 1834. Seeking the point of consensus on 
reforms to OSHA, Chairman Ballenger introduced a second bill, 
H.R. 3234, which incorporated several initiatives moving in the 
same direction of reform which had been previously announced or 
endorsed by the Clinton Administration. H.R. 3234 was approved 
by the Subcommittee on Workforce Protections on April 17, 1996. 
Unfortunately, the Clinton Administration continued to oppose 
all legislative efforts to reform OSHA, and so the Committee 
chose not to further confront the Administration with OSHA 
reform legislation in this Congress. The Committee expects to 
continue its efforts to make OSHA more cost effective in the 
105th Congress.

                             d. adams fruit

    In 1990 the United States Supreme Court, in the case Adams 
Fruit Company v. Barrett, 494 U.S. 638, held that monetary 
claims for injuries under the federal Migrant and Seasonal 
Agricultural Workers Protection Act (MSPA) could be granted 
even if the injuries were also covered and had been compensated 
under a state workers' compensation law. The Supreme Court thus 
exempted workers covered by MSPA from the general rule that 
state workers compensation is the exclusive remedy for injuries 
suffered in the course of employment to which workers 
compensation applies.
    Efforts had been made, on a bipartisan basis, since 1990, 
to reverse the effect of the Supreme Court's decision. 
Legislation attached to a fiscal year 1993 appropriations bill 
temporarily reversed the decision and stated that where workers 
compensation applied, it was the exclusive remedy for injuries 
suffered in the course of employment. That legislation expired, 
however, in July, 1993, leaving agricultural employers exposed 
to liability under MSPA even after workers compensation was 
paid, and leaving agricultural employees exposed to the 
likelihood that their employers in many states would simply 
drop workers compensation coverage altogether.
    The Subcommittee on Workforce Protections held a hearing on 
the issues raised by the Adams Fruit decision on May 25, 1995. 
On June 22, 1995, H.R. 1715, introduced by Chairman Goodling, 
was approved by the Full Committee on Economic and Educational 
Opportunities.
    As introduced and approved by the Committee, H.R. 1715 only 
addressed the exclusive remedy of workers compensation for 
agricultural workers covered by MSPA. Subsequent to Committee 
approval, interested parties and Committee staff engaged in 
extensive negotiations to address several issues related to the 
reversal of the Adams Fruit decision, and to reach consensus on 
legislation. Those negotiations were ultimately successful and 
on October 17, 1995, the House of Representatives unanimously 
approved a substitute version of H.R. 1715. The identical 
legislation was approved by the Senate, and became Public Law 
104-49.

                         e. the davis-bacon act

    The Davis-Bacon Act, passed in 1931, applies to contractors 
who work on federal construction projects. It requires 
contractors to pay certain ``prevailing wages'' to the various 
classes of laborers and mechanics working under federal 
contracts valued at $2,000 or more. Davis-Bacon requirements 
have been also been extended to 60 other programs involving 
varying degrees of federal funding. These programs range from 
low-income housing to Head Start to veterans nursing home care. 
The Davis-Bacon Act has remained essentially unchanged since 
its passage 65 years ago.
    The Subcommittee on Workforce Protection conducted a 
general oversight hearing on the Davis-Bacon Act on February 
15, 1995. Witnesses testified that the Act limits free market 
competition, causes the taxpayers to pay more for federal 
construction projects, denies job opportunities, particularly 
to minority and entry-level workers, causes paperwork and 
recordkeeping burdens and is unnecessary in light of the 
numerous laws that already protect the wages and working 
conditions of all workers. On March 2, 1995 the Subcommittee on 
Workforce Protections approved H.R. 500, legislation to repeal 
the Davis-Bacon Act.
    In January 1995, a number of Oklahoma citizens and public 
officials contacted the Oklahoma Department of Labor regarding 
newly published Davis-Bacon wage rates. A comparison of the old 
and new wage rates showed increases as much as 162 percent. 
These increases are passed along to taxpayers in the form of 
higher costs on public construction projects like schools and 
highways. Because of the increase, the Oklahoma Department of 
Labor began an inquiry in the Davis-Bacon prevailing wage 
survey process. An investigative report, prepared by the 
Oklahoma Department of Labor entitled ``Investigative Report: 
The Davis-Bacon Act, and Fraudulent Wage Data'' was submitted 
to the U.S. Department of Labor (DOL) and to Congress in July 
1995. The initial report by the Oklahoma Department of Labor 
identified three cases of apparent fraudulent activities.
    In keeping with its oversight responsibilities for the U.S. 
Department of Labor, the Committee on Economic and Educational 
Opportunities has been investigating these charges of 
wrongdoing in the Davis-Bacon program. On January 18, 1996 the 
Subcommittees on Oversight and Investigation and Workforce 
Protections conducted a joint hearing in Oklahoma City, 
Oklahoma to review the allegations of fraud and abuse in the 
Davis-Bacon Act. The Subcommittees heard from several witnesses 
including Oklahoma Department of Labor officials and 
contractors. The Oklahoma Department of Labor testified that 
their investigation had uncovered over 100 cases of apparent 
fraudulent activity.
    In addition, the Committee requested the General Accounting 
Office (GAO) to review the prevailing wage process to determine 
if it was susceptible to fraudulent activities. The Committee 
also asked the Department of Labor's Inspector General (the 
internal, independent watchdog over DOL) to investigate the 
allegations of fraud in Oklahoma and to audit several other 
states to determine if fraudulent activities are a systemic, 
nationwide problem.
    The Subcommittee on Oversight and Investigation and the 
Subcommittee on Workforce Protections convened another joint 
hearing on June 20, 1996, to hear the results of the GAO review 
of the U.S. Department of Labor procedures under the Davis-
Bacon Act. The GAO report released on May 31, 1996, raised 
questions about the U.S. Department of Labor's administration 
of the Davis-Bacon Act and stated that ``Labor's wage 
determination procedures contain weaknesses that could permit 
the use of fraudulent or inaccurate data for setting prevailing 
wage rates.'' The Subcommittees also heard testimony from 
Oklahoma Department of Labor officials regarding a recently 
released report entitled ``A Report to the U.S. Congress: 
Regarding Specific Concerns About the U.S. Department of Labor 
Discovered During the Oklahoma Inquiry into Possible Davis-
Bacon Fraud.'' The report based on an extensive review of 
public documents reveals ``that officials within the DOL may 
have played an active role in the wrongful inflation of federal 
prevailing wage rates at the expense of taxpayers and for the 
benefit of favored officials within organized labor.''
    The FBI in Oklahoma City is investigating allegations of 
fraud in the Davis-Bacon Act as well as the role of U.S. DOL 
officials. A grand jury has also been impaneled. Indictments 
are likely ``imminent.''

                      f. the service contract act

    The Service Contract Act, officially called the O'Hara 
McNamara Services Act covers all contracts with the federal 
government in excess of $2,500 whose primary purpose is to 
provide services to the government. At the time of enactment, 
employees typically covered by the Service Contract Act were 
semi-skilled or unskilled workers performing manual work or 
craft work. Types of service contracts covered by the Act were 
varied and included laundry and dry-cleaning, custodial and 
janitorial, guard service, packing and crafting, food service, 
and miscellaneous housekeeping services.
    The Subcommittee on Workforce Protections conducted a 
general oversight hearing on the Service Contract Act on 
February 15, 1995. Witnesses testified that throughout its 
history the Act has been plagued with problems. In particular, 
the Service Contract Act denies small businesses the 
opportunity to compete for federal contracts, costs taxpayers 
billions in inflated wages, and has significant administrative 
problems. On March 2, 1995 the Subcommittee on Workforce 
Protections approved H.R. 246, legislation to repeal the 
Service Contract Act. On September 28, 1995, the Committee on 
Economic and Educational Opportunities reported to the 
Committee on the Budget a provision to repeal the Service 
Contract Act, which was included in H.R. 2491, the Balanced 
Budget Act of 1995, which passed the House on October 26, 1995. 
The provision was ultimately dropped from the final budget 
package.

                 II. Meetings Held by the Subcommittee

    February 15, 1995--Oversight hearing on the Davis-Bacon Act 
and the Service Contract Act.
    March 2, 1995--Mark-up of H.R. 245, to repeal the Service 
Contract Act of 1965.
    Mark-up of H.R. 500, to repeal the Davis-Bacon Act.
    March 8, 1995--Oversight hearing on the Occupational Safety 
and Health Act (OSHA).
    March 30, 1995--Oversight hearing on the Fair Labor 
Standards Act (FLSA).
    May 25, 1995--Oversight hearing on Adams Fruit Co., Inc. v. 
Barrett.
    June 8, 1995--Oversight hearing on the Fair Labor Standards 
Act (FLSA).
    June 20, 1995--Hearing on H.R. 1834, Safety and Health 
Improvement and Regulatory Reform Act of 1995.
    June 28, 1995--Hearing on H.R. 1834, Safety and Health 
Improvement and Regulatory Act of 1995.
    July 11, 1995--Hearing on H.R. 1114, to authorize minors 
under the Fair Labor Standards Act to load paper bailers and 
compactors.
    Hearing on H.R. 1225, to amend the Fair Labor Standards Act 
pertaining to Court Reporters.
    Hearing on H.R. 1783, to require a regulation change under 
the occupational Safety and Health Act of 1970 pertaining to 
firefighters.
    July 27, 1995--Hearing on H.R. 1834, Safety and Health 
Improvement and Regulatory Reform Act of 1995.
    August 24, 1995--Oversight field hearing on the 
Occupational Safety and Health Act (OSHA), held in Pickens, 
South Carolina.
    October 25, 1995--Oversight hearing on the Fair Labor 
Standards Act (FLSA).
    November 1, 1995--Oversight hearing on the Fair Labor 
Standards Act (FLSA).
    December 13, 1995--Mark-up of H.R. 1227, to amend the 
Portal-to-Portal Act of 1947 relating the payment of wages to 
employees who use employer owned vehicles.
    Mark-up of H.R. 2391, ``Working Families Flexibility Act of 
1996''.
    Mark-up of H.R. 2531, to amend the Fair Labor Standards Act 
of 1938 to clarify the exemption for houseparents from the 
minimum wage and maximum hours requirements of that Act, and 
for other purposes.

104th Congress, Second Session

    January 18, 1996--Joint oversight field hearing on the 
Davis-Bacon Act/Oklahoma Fraud Allegations, held with the 
Committee's Subcommittee on Oversight and Investigations, in 
Oklahoma City, Oklahoma.
    April 17, 1996--Mark-up of H.R. 3234, ``Small Business OSHA 
Relief Act of 1996''.
    June 11, 1996--Joint hearing on H.R. 1186, the Professional 
Boxing Act, held with the Subcommittee on Commerce, Trade, and 
Hazardous Materials of the Committee on Commerce.
    June 20, 1996--Joint oversight hearing on Davis Bacon / GAO 
Report, held with the Committee's Subcommittee on Oversight and 
Investigations.
    September 12, 1996--Oversight hearing on the Fair Labor 
Standards Act (FLSA).

                      III. Legislative Activities

                    A. Legislation Enacted into Law

    P.L. 104-26 (H.R. 1225), ``Court Reporter Fair Labor 
Amendments of 1995''.
    P.L. 104-174 (H.R. 1114), to authorize minors who are under 
the child labor provisions of the Fair Labor Standards Act of 
1938 and who are under 18 years of age to load materials into 
balers and compactors that meet appropriate American National 
Standards Institute design safety standards.

           B. Legislation Enacted as Part of Another Measure

    H.R. 1227, ``Employee Commuting Flexibility Act'', was 
included in H.R. 3448 and enacted as P.L. 104-188.

                    C. Legislation Passed the House

    H.R. 1114, to authorize minors who are under the child 
labor provisions of the Fair Labor Standards Act of 1938 and 
who are under 18 years of age to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards.
    H.R. 1225, ``Court Reporter Fair Labor Amendments of 
1995''.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles.
    H.R. 2391, ``Working Families Flexibility Act of 1996''.

           D. Legislation Passed the House in Another Measure

    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles, passed the House in H.R. 3448.

                   E. Legislation with Filed Reports

    H.R. 1114 (H.Rept. 104-278), to authorize minors who are 
under the child labor provisions of the Fair Labor Standards 
Act of 1938 and who are under 18 years of age to load materials 
into balers and compactors that meet appropriate American 
National Standards Institute design safety standards.
    H.R. 1225 (H.Rept. 104-219), ``Court Reporter Fair Labor 
Amendments of 1995''.
    H.R. 1227 (H.Rept. 104-585), to amend the Portal-to-Portal 
Act of 1947 relating to the payment of wages to employees who 
use employer owned vehicles.
    H.R. 2391 (H.Rept. 104-670), ``Working Families Flexibility 
Act of 1996''.
    H.R. 2531 (H.Rept. 104-592), to amend the Fair Labor 
Standards Act of 1938 to clarify the exemption for houseparents 
from the minimum wage and maximum hours requirements of that 
Act, and for other purposes.

          F. Legislation Ordered Reported from Full Committee

    H.R. 1114, to authorize minors who are under the child 
labor provisions of the Fair Labor Standards Act of 1938 and 
who are under 18 years of age to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards.
    H.R. 1225, ``Court Reporter Fair Labor Amendments of 
1995''.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles.
    H.R. 2391, ``Working Families Flexibility Act of 1996''.

               G. Legislation Reported from Subcommittee

    H.R. 246, to repeal the Service Contract Act of 1965.
    H.R. 500, to repeal the Davis-Bacon Act.
    H.R. 1227, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer 
owned vehicles.
    H.R. 2391, ``Working Families Flexibility Act of 1996''.
    H.R. 2531, to amend the Fair Labor Standards Act of 1938 to 
clarify the exemption for houseparents from the minimum wage 
and maximum hours requirements of that Act, and for other 
purposes.
    H.R. 3234, ``Small Business OSHA Relief Act of 1996''.

              h. legislation discharged from subcommittee

    H.R. 1114, to authorize minors who are under the child 
labor provisions of the Fair Labor Standards Act of 1938 and 
who are under 18 years of age to load materials into balers and 
compactors that meet appropriate American National Standards 
Institute design safety standards.
    H.R. 1225, ``Court Reporter Fair Labor Amendments of 
1995''.

                         I. Legislation Vetoed

    None of the legislation referred to Subcommittee was 
vetoed.

                      IV. Subcommittee Statistics

Total Number of Bills and Resolutions Referred to Subcommittee....    82
Total Number of Bills Discharged from Subcommittee................     2
Total Number of Subcommittee Hearings.............................    18
    Field.........................................................     2
    Joint with Other Committees...................................     1
Total Number of Subcommittee Mark-Up Sessions.....................     3
Total Number of Bills Reported from Subcommittee..................     6
Total Number of Bills Ordered Reported from Full Committee........     4
Total Number of Filed Reports on Bills............................     5
Total Number of Bills Passed the House............................     4
Total Number of Bills Passed the House in Another Measure.........     1
Total Number of Bills Enacted into Law............................     2
Total Number of Bills Enacted as Part of Another Measure..........     1
Total Number of Bills Vetoed......................................     0

          SUBCOMMITTEE ON EARLY CHILDHOOD, YOUTH AND FAMILIES

                        I. Summary of Activities

                      A. EDUCATING AMERICA'S YOUTH

School reform

    On June 21, 1995 and July 13, 1995, the Subcommittee on 
Early Childhood, Youth and Families held hearings on education 
reform as it pertains to public elementary and secondary 
schools. The hearings provided a beginning framework for 
gathering information on the quality of public education and 
answering the following two questions: (1) What needs to be 
done to reform and transform public education so it meets the 
needs of families, students, and employees of the 21st 
century?; and (2) What should be the Federal government's role, 
if any, in education reform?
    At the hearing on June 21, 1995, Committee Members, Dave 
Weldon and Frank Riggs, primary sponsors of H.R. 1640, the 
``Low Income School Choice Demonstration Act of 1995,'' 
presented strong arguments for the establishment of a 
nationwide public and private school choice demonstration 
program to test the effectiveness of school choice as a means 
of improving K-12 education. Testimony was also received on how 
public charter schools have provided an increasingly popular 
and effective model for education reform in various States.
    The hearing on July 13, 1995 examined various education 
reforms at the State and local levels including raising 
academic standards (i.e. importance of academic standards to 
private businesses), private management of public schools, 
district-wide public school choice, and various other local 
reforms.
    On July 30, 1996, the Subcommittee held a joint hearing 
with the Subcommittee on Human Resources of the Ways and Means 
Committee on H.R. 3467, ``Saving Our Children: The American 
Community Renewal Act of 1996.'' H.R. 3467, provided a 
comprehensive approach for the renewal of poor urban and rural 
communities. This bill was introduced on May 16, 1996 by 
Representative Jim Talent, a Member of the Economic and 
Educational Opportunities Committee, and Representative J.C. 
Watts. Through the use of free enterprise, tax incentives, and 
public and private school choice, the legislation provides a 
solid framework for community renewal. Title IV of the 
legislation would have established a low income scholarship 
program giving low income parents the opportunity to choose the 
best schools, public, private, or parochial, for their 
children. No further action was taken on this measure during 
the 104th Congress.
    Further discussion on school reform can be found in the 
``Full Committee'' and ``Subcommittee on Oversight and 
Investigations'' sections of this report.

H.R. 3268, The IDEA Improvement Act of 1996

    The Individuals with Disabilities Education Improvement 
(IDEA) Act, H.R. 3268, was introduced by Subcommittee Chairman 
Randy ``Duke'' Cunningham on April 18, 1996. The bill amended 
the Individuals with Disabilities Education Act based on 
information gathered in four hearings. The first hearing, held 
jointly with the Senate Subcommittee on Disability Policy on 
May 9, 1995 was followed by two Subcommittee on Early 
Childhood, Youth and Families hearings on June 20 and 27, 1995. 
A fourth hearing on a draft version of the bill was held on 
March 7, 1996.
    The amendments to the Act made significant changes to the 
permanently authorized Part B program for school-aged children, 
the Part H infant and toddler program, and the 14 funded-
discretionary programs. The bill included a change in the 
funding formula, which phased in a formula based on each 
State's child population and child poverty statistics over a 
ten-year period. The bill reduced inappropriate attorney's fees 
and limited reimbursement by public schools for the cost of 
private school tuition where a child was unilaterally placed in 
such schools by the child's parents.
    The bill reduced unnecessary paperwork by streamlining 
Individualized Education Programs, State and local application 
procedures, and evaluation requirements. Its provisions 
permitted the removal of dangerous children from classrooms, 
regardless of their disability status, and permitted the equal 
disciplinary treatment of disabled children where the child's 
actions are unrelated to their disability.
    H.R. 3268 reorganized the 14 funded discretionary programs 
under the Act into four broad programs: a national research and 
improvement program; a national professional development 
program focused on low-incidence disabilities, model training 
programs, and training of special education higher-educators; a 
State program primarily focused on professional development; 
and a parent training center program. The Act also repealed the 
never funded and expired Part I program.
    On April 24, 1996, the bill was considered and approved by 
the Subcommittee by voice vote. On May 30, 1996, the bill was 
considered and approved by the Economic and Educational 
Opportunities Committee by a vote of 32-5, and was passed by 
the House of Representatives under Suspension of the Rules on 
June 10, 1996, by voice vote. While the Senate Labor and Human 
Resources Committee did unanimously consider and approve a bill 
amending IDEA, S. 1578, on March 21, 1996, neither that 
legislation nor H.R. 3268 was considered by the Senate during 
the 104th Congress.

English as the official language of the federal government

    On October 18, 1995 and November 1, 1995 Subcommittee 
Chairman Randy ``Duke'' Cunningham held hearings on the general 
topic of English as the Common Language, receiving testimony 
from Members of Congress and other interested parties.
    H.R. 123, the ``Bill Emerson English Language Empowerment 
Act of 1996'' was introduced by the late Representative Bill 
Emerson and approved by the Committee on Economic and 
Educational Opportunities on July 23, 1996, by a vote of 19 to 
17 and passed the House of Representatives on August 1, 1996, 
by a vote of 259-169. The Senate failed to take any action on 
this legislation.
    The legislation declares English the official language of 
the federal government, and requires the government to conduct 
most of its official business in English. It builds upon our 
nation's historic tradition and is designed to unify Americans 
from all walks of life behind one shared language. It replaces 
a balkanized national language policy, devoid of any uniform 
principles, with a common sense, common language policy. The 
bill has no effect upon the use of foreign languages in homes, 
neighborhoods, churches, or private businesses. Affirming 
English as the official language of the government ensures that 
all Americans can count on one language for government actions, 
policies and documents. It reinforces other national policies, 
such as the requirement that one be able to read, write and 
speak English before becoming a United States citizen.

Impact aid

    H.R. 3269, the Impact Aid Technical Amendments Act of 1996, 
was introduced by Chairman Randy ``Duke'' Cunningham on April 
18, 1996. H.R. 3269, as introduced, amended the Impact Aid 
program to provide for the following: inclusion of a hold 
harmless provision with respect to amounts for payments 
relating to the federal acquisition of real property; inclusion 
of provisions to address funding concerns arising from 
renovation of military housing; establishment of categories of 
eligibility of consolidated school districts for payments 
relating to the federal acquisition of real property; and 
clarification that each of Hawaii's seven administrative school 
districts are to be considered as separate local educational 
agencies.
    In each of these instances, the Committee felt it necessary 
to take action to ensure that school districts would not be 
adversely affected by actions beyond their control--either on 
the part of Congress or of other government agencies.
    The Subcommittee on Early Childhood, Youth and Families 
reported H.R. 3269, by voice vote, on April 24, 1996. On May 1, 
1996, the Committee on Economic and Educational Opportunities 
reported the bill favorably by voice vote.
    H.R. 3269 passed the House of Representatives on May 7, 
1996, by voice vote and was forwarded to the Senate for 
consideration. H.R. 3269, as amended, passed the Senate on 
August 2, 1996, by voice vote.
    The House of Representatives agreed to the Senate 
amendments by voice vote on September 4, 1996, and the bill was 
signed into law on September 16, 1996. It is now Public Law 
104-195.
    The Subcommittee also held several days of hearings on the 
Impact Aid Program. On July 19, 1995, the Subcommittee held a 
hearing on military-connected children and Impact Aid in 
Washington, D.C. On July 8, 1996, the Subcommittee held an 
additional hearing to explore the impact of decisions 
concerning housing for military personnel and their families on 
the Impact Aid program.

Library and museum services

    On May 2, 1995, the Subcommittee held a hearing on Adult 
Education, Literacy, and Library Services. Library Services and 
Technology provisions were incorporated into H.R. 1617, the 
Consolidated and Reformed Education, Employment, and 
Rehabilitation Systems Act (CAREERS), which was introduced by 
Representative Howard P. ``Buck'' McKeon on May 11, 1995. On 
May, 16, 1995, the Subcommittee on Early Childhood, Youth and 
Families approved H.R. 1617 as amended by voice vote. On May 
17, 1995, the Subcommittee on Postsecondary Education, Training 
and Life-Long Learning approved H.R. 1617 as amended by voice 
vote and ordered it reported to the Committee on Economic and 
Educational Opportunities. On May 24, 1995, H.R. 1617 as 
amended was ordered reported by the Committee on Economic and 
Educational Opportunities by a vote of 29-5. On September 19, 
1995, the House of Representatives passed H.R. 1617 by a vote 
of 345-79, and a Conference Report on the Workforce and Career 
Development Act was filed on July 25, 1996. However, the 
Conference Agreement was not considered by either the House of 
Representatives or the Senate during the final days of the 
104th Congress.
    On May 3, 1995, Representative Bill Goodling along with 
Representative Randy ``Duke'' Cunningham as a cosponsor, 
introduced H.R. 1557, the Arts, Humanities, and Museum Services 
Amendments of 1995 which among other things would have 
authorized continued funding of the Institute of Museum 
Services (IMS) for three years. On May 10, 1995, the Committee 
on Economic and Educational Opportunities considered and 
approved H.R. 1557 as amended by a vote of 19 yeas, 2 nays, and 
18 voting present.
    The Museum and Library Services and Technology Act was 
included in H.R. 3610, the Omnibus fiscal year 1997 
Appropriations bill and signed into law by the President on 
September 30, 1996. It is now Public Law 104-208.
    The Museum and Library Services Act of 1996 moves the 
federal responsibility for library programs into a new 
Institute of Museum and Library Services and streamlines and 
consolidates several federal library programs into one program 
focused on helping all libraries acquire cutting-edge 
technologies and better serving those with special needs.
    Library Services Technology Consolidation grants will 
provide for improved library services to our citizens through 
the use of new information technologies. They will help bring 
America's libraries; public, elementary and secondary, and 
academic into the 21st century. These reforms will help 
libraries form electronic linkages with one another to better 
share resources, and will give all Americans access to new and 
better sources of information, such as the Internet.
    America is undergoing a technological revolution including 
a tremendous proliferation in new sources of information. This 
trend will not only continue, but is certain to accelerate. It 
is clear that America's libraries will need to take advantage 
of these new technologies if they are to continue to ensure 
that all Americans have equal access to information.

                  b. strengthening america's families

Adult education

    The Subcommittee on Early Childhood, Youth and Families 
held two days of hearings on adult education and family 
literacy issues. The first hearing was held on April 25, 1995, 
in San Marcos, California. The second hearing was held May 2, 
1995, in Washington, D.C.
    Testimony received by the Subcommittee was supportive of 
adult education and family literacy programs and the variety of 
services provided to adults in need of literacy services. 
Individual witnesses expressed support for program 
consolidation and more flexibility at the State and local level 
to design and operate programs.
    As a result, legislation creating an adult education and 
family literacy block grant was incorporated into H.R. 1617, 
the Consolidated and Reformed Education, Employment, and 
Rehabilitation Systems (CAREERS) Act. This block grant gave 
States broad flexibility in funding literacy programs for 
adults in need of services. All caps and set asides were 
removed and States were given broad flexibility to meet the 
literacy needs of their citizens. The legislation also limited 
the amount of funds which could be held at the State level, 
driving the bulk of the funds to local providers to provide 
actual program services. In addition, the block grant 
specifically stated, for the first time, that funds could be 
used for family literacy programs to work with adults and their 
children at the same time. The family literacy concept had been 
shown not only to raise the literacy level of adults, but to 
help ensure the educational success of their children as well. 
Finally, the block grant retained the requirement that States 
continue to provide a matching amount of funds for adult 
education in order to receive federal funds.
    The adult education and family literacy portions of H.R. 
1617 were reported by the Subcommittee on Early Childhood, 
Youth and Families on May 16, 1995, by voice vote.
    Further discussion on H.R. 1617 can be found in the 
``Subcommittee on Postsecondary, Education, Training and Life-
Long Learning'' section of this report.

Juvenile justice

    H.R. 3876, the Juvenile Crime Control and Delinquency 
Prevention Act, was introduced by Chairman Randy ``Duke'' 
Cunningham on July 23, 1996.
    Prior to the introduction of this legislation, the 
Subcommittee on Early Childhood, Youth and Families held four 
hearings for the purpose of considering and reviewing the 
authorization of the Juvenile Justice and Delinquency 
Prevention Act.
    The first of the four hearings was held on March 28, 1996 
in Washington, D.C. This was a general hearing and witnesses 
discussed changes to the Juvenile Justice and Delinquency 
Prevention Program as well as the Runaway and Homeless Youth 
Program. The second hearing, which focused on youth violence 
and gangs, was held in Washington, D.C. on April 30, 1996. The 
third hearing, which focused on prevention programs, was held 
in Washington, D.C. on May 8, 1996. The fourth hearing was held 
in San Diego, California on May 13, 1996, and focused on local 
efforts to address problems of juvenile delinquency.
    Based on these hearings and concern over the growing number 
of violent juvenile crimes, the Committee determined that there 
was a great need to modify the existing law to focus on holding 
juveniles accountable for their actions, as well as helping to 
prevent juvenile crime. Testimony also indicated there was a 
need to consolidate existing programs and to generally 
streamline program requirements and burdensome State mandates 
to provide greater flexibility to States to address juvenile 
crime. H.R. 3876, as introduced, reflected these changes.
    On July 25, 1996, the Subcommittee on Early Childhood Youth 
and Families reported H.R. 3876, ``The Juvenile Crime Control 
and Delinquency Prevention Act of 1996'', as amended by voice 
vote. On August 1, and August 2, 1996 the Committee on Economic 
and Educational Opportunities assembled to consider H.R. 3876. 
H.R. 3876 was favorably reported by the Committee on August 2, 
1996, by a recorded vote of 23-2.

H.R. 2570, The Older Americans Act Amendments of 1996

    During the 104th Congress, the Subcommittee on Early 
Childhood, Youth and Families proposed significant reforms to 
the delivery of services under the Older Americans Act.
    The Older Americans Act of 1965 created a federal program 
specifically designed to meet the service needs of older 
persons. Although older persons may receive services under 
other federal programs, the Act is the major vehicle for the 
organization and delivery of supportive and nutrition services 
to this group.
    Through a series of five hearings held on June 13, 1995, 
June 26, 1995, June 28, 1995, July 10, 1995, and November 2, 
1995, it became quite evident that after 30 years of federal 
requirements being added to this legislation, the Older 
Americans Act of 1965 was in need of comprehensive reform. 
While there was no question regarding the benefits of these 
programs, the federal requirements had simply become too 
burdensome and were impeding delivery of vital services to the 
elderly. In recent years, State and area aging agencies have 
noted the increasing array of legislative requirements imposed 
on them without corresponding increases in funding.
    On November 1, 1995, Subcommittee Chairman Randy ``Duke'' 
Cunningham introduced H.R. 2570, The Older Americans Act 
Amendments of 1995. The bill improves services to seniors by 
providing better quality services; by driving more funds 
directly to local communities and, in turn, directly to 
seniors; by giving local providers the flexibility to design 
programs most needed by the elderly population in their own 
communities; and, by helping seniors live fuller more active 
lives.
    H.R. 2570 was approved by the Subcommittee on Early 
Childhood, Youth and Families on November 16, 1995, by voice 
vote and by the Committee on Economic and Educational 
Opportunities on March 14, 1996 by a vote of 19-16. The Senate 
reported a bill amending the Older Americans Act, S. 1643, on 
May 8, 1996 by a vote of 9 to 7. No further action occurred on 
this legislation during the 104th Congress.

Reform of the Child Abuse Prevention and Treatment Act (CAPTA)

    On January 31, 1995, the Subcommittee on Early Childhood, 
Youth and Families held a hearing on the status of the child 
protection system in this country. It was clear from this 
hearing and other research by this Committee that the current 
system had failed in two significant ways--it had unnecessarily 
intruded in the family life of millions of Americans wrongfully 
accused of child abuse or neglect and too often failed in 
protecting those children truly at risk.
    At the heart of this failure was a maze of federal programs 
which focused too much on federal micro-management of the 
States and provided too little flexibility at the State and 
local level. It was clear that, rather than squandering federal 
resources in dozens of directions at once, with one hand not 
knowing what the other was doing, the federal effort in child 
protection should be concentrated, focused, and unified.
    Based on these findings, this Committee worked with the 
Ways and Means Committee (which also has jurisdiction over 
certain child protection programs including the foster care and 
adoption assistance entitlement programs) to bring multiple 
sources of funding together in one block grant, giving States 
and localities flexibility in administering the funds, and 
placing a premium on uniform data collection and evaluation in 
order to greatly enhance and improve the federal role in child 
protection.
    Provisions for such a block grant were originally part of 
H.R. 999, the Welfare Reform Consolidation Act of 1995, 
reported out of the Committee on Economic and Educational 
Opportunities on February 23, 1995. H.R. 999 was eventually 
merged with H.R. 4, the Personal Responsibility Act, sent to 
the President on December 29, 1995, and subsequently vetoed. A 
modified version of the child protection block grant was also 
included as part of Budget Reconciliation for fiscal year 1997, 
H.R. 3734, the Welfare and Medicaid Act of 1996, as reported 
from the Committee on June 16, 1996. This Title was later 
dropped during the conference committee negotiations with the 
Senate, due to the Senate's ``Byrd rule'' limitations.
    In anticipation of these provisions being dropped from the 
welfare reform legislation, the Senate passed (by unanimous 
consent) S. 919 on July 18, 1996, to authorize and amend the 
existing CAPTA program. This legislation also included a host 
of amendments to the Child Abuse Prevention and Treatment Act 
(CAPTA) as well as program consolidation provisions which to a 
certain degree reflected many of the initiatives begun as part 
of the welfare reform legislation.
    Because a significant portion of S. 919 had been considered 
by the Committee in both hearings held by the Committee and 
during the separate markups of the welfare legislation, the 
House substitute was taken up directly at the desk and passed 
by unanimous consent on September 27, 1996 and signed into law 
(Public Law 104-235) on October 3, 1996.
    Further description of the Committee's activities related 
to welfare reform are described under the ``Full Committee 
Activities'' section of this report.

Child care

    The Subcommittee on Early Childhood, Youth and Families 
held a hearing on January 31, 1995 and a joint hearing with the 
Ways and Means Subcommittee on Human Resources on February 3, 
1995 to consider consolidation of child care programs within 
the context of welfare reform.
    It was clear from these hearings and from other research by 
the Committee that too many federal child care programs 
currently exist with inconsistent and uncoordinated eligibility 
rules and other requirements. This fragmented system caused 
children and families to experience disruption in their day 
care arrangements as they attempted to move from welfare to 
work.
    Knowing the importance of child care in helping families 
move from welfare to work, the Committee was dedicated to 
assisting States in developing the most efficient and effective 
way to use federal funds to assist low income families. Based 
on findings, the Committee worked with the Ways and Means 
Committee (which had jurisdiction over AFDC related child care 
programs) to bring multiple sources of funding together under 
the existing Child Care and Development Block Grant.
    Provisions for the child care block grant were originally 
part of H.R. 999, the Welfare Reform Consolidation Act of 1995 
and were marked up in the Committee on Economic and Educational 
Opportunities on February 22 and 23, 1995. H.R. 999 was 
eventually merged with H.R. 4, the Personal Responsibility Act. 
The funding structure for the child care provisions was 
substantially modified to include a combination of mandatory 
and discretionary funding in the House and Senate conference 
before it was sent to the President on December 29, 1995, and 
subsequently vetoed.
    The Child Care and Development Block Grant provisions were 
included in the submission to the Budget Committee for the 
Budget Resolution for fiscal year 1997 and were subsequently 
incorporated into H.R. 3734, the Welfare and Medicaid Reform 
Act of 1996. H.R. 3734 was signed into law (Public Law 104-193) 
on August 22, 1996.
    Further description of the Committee's activities related 
to welfare reform are described under the ``Full Committee 
Activities'' section.

Drug use

    On September 26, 1996, the Subcommittee on Early Childhood, 
Youth and Families and the Subcommittee on National Security, 
International Affairs and Criminal Justice of the Committee on 
Government Reform and Oversight held a joint hearing on the 
Epidemic of Teenage Drug Use.
    During this hearing, the Subcommittees learned a great deal 
about private initiatives utilized by various Members of 
Congress who either established or supported existing community 
anti-drug coalitions. The first witness of the hearing, 
Congressman Rob Portman cited the success of Miami's 
comprehensive community anti-drug coalition that cut usage in 
Miami to half that of the national average. What the successful 
programs do, he continued, is mobilize ``parents, businesses, 
religious leaders, students, law enforcement, the media and 
others to fashion a comprehensive long-term strategy to prevent 
and treat substance abuse one person at a time.''
    There was also a discussion at the hearing regarding what 
message we should be sending as a society. ``In my view,'' 
Congressman Portman said, ``Nancy Reagan's `Just Say No' 
campaign was not just about a slogan; it was about a national 
movement that energized the war on drugs, mobilized and 
organized people all across America, and gave the drug issue 
media attention.''
    The second witness was Judge Robert Bonner, the former 
Administrator of the Drug Enforcement Agency. Judge Bonner 
noted that it was not a mere coincidence that during the last 
four years there has been an extreme rise in teenage drug use. 
Indeed Judge Bonner explained that there has been a dramatic 
rise in teenage drug use because ``there has been a nearly 
total absence of Presidential leadership on this issue.'' Judge 
Bonner expressed great concern because our country ``cannot 
have an effective drug control policy when the President 
himself does not make this a serious issue, when he jokes about 
it and, even worse, when the President himself is the butt of 
jokes because of remarks he has made about his own involvement 
with drugs.''
    The Subcommittees heard testimony that the problem has to 
be addressed by parents and schools at the local level, but 
that those groups need the support of the federal government.

                 II. Meetings Held by the Subcommittee

104th Congress, First Session

    January 31, 1995--Oversight hearing on the Contract with 
America: child welfare and child care.
    February 3, 1995--Joint oversight hearing on child welfare 
and child care, held with the Subcommittee on Human Resources 
of the Committee on Ways and Means.
    April 25, 1995--Oversight field hearing on adult education, 
held in San Marcos, California.
    May 2, 1995--Oversight hearing on adult education.
    May 9, 1995--Joint oversight hearing on the 20th 
Anniversary of Individuals with Disabilities Education Act 
(IDEA), held with the Senate Subcommittee on Disability Policy 
of the Committee on Labor and Human Resources.
    May 16, 1995--Mark-up of H.R. 1617, ``Workforce and Career 
Development Act of 1996''.
    June 13, 1995--Oversight hearing on the Older Americans 
Act.
    June 20, 1995--Oversight hearing on the Individuals with 
Disabilities Education Act (IDEA).
    June 21, 1995--Oversight hearing on education reform.
    June 26, 1995--Oversight field hearing on the Older 
Americans Act, held in York, Pennsylvania.
    June 27, 1995--Oversight hearing on the Individuals with 
Disabilities Education Act (IDEA).
    June 28, 1995--Oversight hearing on the Older Americans 
Act.
    July 10, 1995--Oversight field hearing on the Older 
Americans Act, held in Pontiac, Michigan.
    July 13, 1995--Oversight hearing on education reform.
    July 19, 1995--Oversight hearing on Military connected 
children and Impact Aid.
    October 18, 1995--Oversight hearing on English as the 
common language.
    November 1, 1995--Oversight hearing on English as the 
common language.
    November 2, 1995--Hearing on H.R. 2570, ``Older Americans 
Amendments of 1995''.
    November 9, 1995--Mark-up of H.R. 2570, ``Older Americans 
Amendments of 1995''.
    November 16, 1995--Mark-up of H.R. 2570, ``Older Americans 
Amendments of 1995''.

104th Congress, Second Session

    March 7, 1996--Oversight hearing on the staff draft of the 
Individuals with Disabilities Act (IDEA).
    March 28, 1996--Oversight hearing on the Juvenile Justice 
and Delinquency Prevention Act.
    April 24, 1996--Mark-up of H.R. 3268, ``IDEA Improvement 
Act of 1996''.
    Mark-up of H.R. 3269, ``Impact Aid Technical Amendments Act 
of 1996''.
    April 30, 1996--Oversight hearing on the Juvenile Justice 
and Delinquency Prevention Act.
    May 8, 1996--Oversight hearing on the Juvenile Justice and 
Delinquency Prevention Act.
    May 13, 1996--Oversight field hearing on the Juvenile 
Justice and Delinquency Prevention Act, held in San Marco, 
California.
    July 8, 1996--Oversight field hearing on Impact Aid, held 
in Fairfield, California.
    July 25, 1996--Mark-up of H.R. 3876, ``Juvenile Crime 
Control and Delinquency Prevention Act of 1996''.
    July 30, 1996--Joint hearing on H.R. 3467, Saving our 
Children: The American Community Renewal Act of 1996, held with 
the Subcommittee on Human Resources of the Committee on Ways 
and Means.
    September 19, 1996--Hearing on federally funded youth 
programs and local initiatives.
    September 26, 1996--Joint hearing on the epidemic of 
teenage drug use, held with the Subcommittee on National 
Security, International Affairs, and Criminal Justice of the 
Committee on Government Reform and Oversight.

                      III. Legislative Activities

                    A. Legislation Enacted into Law

    P.L. 104-149 (H.R. 2066), ``Healthy Meals for Children 
Act''.
    P.L. 104-195 (H.R. 3269), ``Impact Aid Technical Amendments 
Act of 1996''.

           B. Legislation Enacted as Part of Another Measure

    H.R. 3286, ``Adoption Promotion and Stability Act of 
1996''. Provisions of the bill were included in H.R. 3448 and 
enacted as P.L. 104-188.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''. Provisions of the bill were included in H.R. 3610 and 
enacted as P.L. 104-208.
    S. 1972, ``Older Americans Indian Technical Amendments 
Act'', was included in H.R. 3610 and enacted as P.L. 104-208.

                    C. Legislation Passed the House

    H.R. 123, ``Bill Emerson English Language Empowerment Act 
of 1996''.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 2066, ``Healthy Meals for Children Act''.
    H.R. 3268, ``IDEA Improvement Act of 1996''.
    H.R. 3269, ``Impact Aid Technical Amendments Act of 1996''.
    H.R. 3286, ``Adoption Promotion and Stability Act of 
1996''.
    S. 1972, ``Older Americans Indian Technical Amendments 
Act''.

           D. Legislation Passed the House in Another Measure

    H.R. 1617, ``Workforce and Career Development Act of 
1996'', passed the House in S. 1972.
    H.R. 2332, ``Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems Act'' or ``CAREERS 
Act''. Provisions of the bill passed the House in H.R. 1617.
    H.R. 3898, ``English Language Empowerment Act of 1996''. 
Provisions of the bill passed the House in H.R. 123.

                   E. Legislation With Filed Reports

    H.R. 123 (H. Rept. 104-723), ``Bill Emerson English 
Language Empowerment Act of 1996''.
    H.R. 1617 (H. Rept. 104-152), ``Workforce and Career 
Development Act of 1996''.
    H.R. 2066 (H. Rept. 104-561), ``Healthy Meals for Children 
Act''
    H.R. 2570 (H. Rept. 104-539), ``Older Americans Amendments 
of 1995''.
    H.R. 3268 (H. Rept. 104-614), ``IDEA Improvement Act of 
1996''.
    H.R. 3269 (H. Rept. 104-560), ``Impact Aid Technical 
Amendments Act of 1996''.
    H.R. 3876 (H. Rept. 104-783), ``Juvenile Crime Control and 
Delinquency Prevention Act of 1996''.

          F. Legislation Ordered Reported From Full Committee

    H.R. 123, ``Bill Emerson English Language Empowerment Act 
of 1996''.
    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 2066, ``Healthy Meals for Children Act''.
    H.R. 2570, ``Older Americans Amendments of 1995''.
    H.R. 3268, ``IDEA Improvement Act of 1996''.
    H.R. 3269, ``Impact Aid Technical Amendments Act of 1996''.
    H.R. 3876, ``Juvenile Crime Control and Delinquency 
Prevention Act of 1996''.

               G. Legislation Reported from Subcommittee

    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 2570, ``Older Americans Amendments of 1995''.
    H.R. 3268, ``IDEA Improvement Act of 1996''.
    H.R. 3269, ``Impact Aid Technical Amendments Act of 1996''.
    H.R. 3876, ``Juvenile Crime Control and Delinquency 
Prevention Act of 1996''.

              H. Legislation Discharged from Subcommittee

    H.R. 123, ``Bill Emerson English Language Empowerment Act 
of 1996''.
    H.R. 2066, ``Healthy Meals for Children Act.''

                         I. Legislation Vetoed

    None of the legislation referred to Subcommittee was 
vetoed.

                      IV. Subcommittee Statistics

Total Number of Bills and Resolutions Referred to Subcommittee....   119
Total Number of Bills Discharged from Subcommittee................     2
Total Number of Subcommittee Hearings.............................    26
    Field Hearings................................................     5
    Joint Hearings with Other Committees..........................     3
Total Number of Subcommittee Mark-Up Sessions.....................     5
Total Number of Bills Reported from Subcommittee..................     5
Total Number of Bills Ordered Reported from Full Committee........     7
Total Number of Filed Reports on Bills............................     7
Total Number of Bills Passed the House............................     7
Total Number of Bills Passed the House in Another Measure.........     3
Total Number of Bills Enacted into Law............................     2
Total Number of Bills Enacted as Part of Another Measure..........     3
Total Number of Bills Vetoed......................................     0

    SUBCOMMITTEE ON POSTSECONDARY EDUCATION, TRAINING AND LIFE-LONG 
                                LEARNING

                        I. Summary of Activities

                 A. EMPLOYMENT AND JOB TRAINING REFORM

Workforce development reform legislation

    During the 104th Congress, much of the Subcommittee on 
Postsecondary Education, Training and Life-Long Learning's work 
focused on reform of this nation's vast array of federal 
workforce development and literacy programs. Reports from the 
U.S. General Accounting Office (GAO) highlighting the excessive 
number of federally funded job training programs, as well as 
conflicting reports on the quality of the U.S. workforce 
development system, have sparked both public and Congressional 
interest in systemic reform for the past several years. To 
date, the GAO has identified over 150 different programs which 
offer some form of career-related education, job training, or 
employment assistance to youth and adults. In its studies, the 
GAO found that the additional costs of administering 
overlapping workforce development programs at the federal, 
State, and local levels, diverts scarce resources that could be 
better spent to assist individuals in preparing for and 
entering into work.
    Beginning in February, 1995, the Subcommittee held nine 
hearings on reform of federal workforce development programs, 
in addition to two hearings that were conducted by the 
Subcommittee on Early Childhood, Youth and Families on adult 
education, literacy, and library-related programs. In hearings 
conducted on February 6 and 7, 1995, the Subcommittee examined 
U.S. business leaders' perspectives on the education and 
training needs of the U.S. workforce. The Subcommittee also 
heard testimony from the U.S. Departments of Education and 
Labor and the U.S. General Accounting Office during these 
hearings. On March 1 and 3, 1995, the Subcommittee conducted 
hearings which focused on the Carl D. Perkins Vocational and 
Applied Technology Education Act and other innovative career-
related education programs. On March 7 and 16, 1995, hearings 
were conducted to examine the education, training, and 
employment needs of at-risk and disadvantaged youth, with a 
panel of witnesses at the March 16 hearing providing testimony 
on the federal Job Corps Program. On March 21, 1995, a hearing 
was held that dealt with governance issues related to training 
programs, with testimony from State and local officials, 
service providers, and the private sector. A hearing held on 
March 23, 1995, examined issues related to system 
infrastructure, forecasting, and special populations. And 
finally, a hearing conducted on March 29, 1995 focused on 
vocational rehabilitation.
    Of all of the witnesses who came before the Subcommittee to 
testify on reform of the U.S. workforce development system, 
everyone including representatives from the Administration, 
State officials, local officials, business leaders, educators, 
program providers, researchers, and organized labor, agreed 
that significant program consolidation and reform of U.S. 
workforce development programs is in order.
    On May 11, 1995, Republican Members of the Committee on 
Economic and Educational Opportunities, led by Subcommittee 
Chairman Howard P. ``Buck'' McKeon and Chairman Bill Goodling 
introduced H.R. 1617, the Consolidated and Reformed Employment, 
Education and Rehabilitation Systems (CAREERS) Act. H.R. 1617 
was designed to transform the confusing array of federal 
workforce development and literacy programs from a collection 
of fragmented and duplicative categorical programs into a 
streamlined, comprehensive, high-quality, market-based, and 
accountable workforce development and literacy system. This 
legislation was designed to transfer responsibility for the 
design and implementation of these programs out of Washington, 
to States and local communities; and to better meet the 
education, employment, training, and literacy needs of 
Americans, and the competitiveness needs of U.S. employers.
    On May 16, 1995, the Subcommittee on Early Childhood, Youth 
and Families considered and approved H.R. 1617, as amended, by 
a voice vote. On May 17, 1995, the Subcommittee on 
Postsecondary Education, Training and Life-Long Learning 
considered and approved H.R. 1617, as amended, by voice vote, 
and ordered the bill reported to the Full Committee on Economic 
and Educational Opportunities.
    On May 24, 1995, the Full Committee on Economic and 
Educational Opportunities met to consider H.R. 1617, where the 
bill was amended and favorably reported by a recorded vote of 
29-5.
    On September 19, 1995, the House of Representatives, in a 
bipartisan vote of 345-79, overwhelmingly passed H.R. 1617. The 
Senate passed the bill on October 11, 1995 by a vote of 95 to 2 
and requested a conference with the House. During the 2nd 
session of the 104th Congress, House and Senate conferees met 
to resolve differences between H.R. 1617, and S. 143, the 
Senate's ``Workforce Development Act of 1995.'' A final 
conference agreement on the newly named ``Workforce and Career 
Development Act'' was reached, and a Conference Report was 
filed on July 25, 1997. However, the conference agreement was 
not considered by either the Senate or the House of 
Representatives during the final days of the 104th Congress.

The Job Opportunities and Basic Skills Program

    During the 104th Congress, the Subcommittee on 
Postsecondary Education, Training and Life-Long Learning helped 
initiate major changes related to the work requirements as 
included under welfare reform. On February 19, 1995, the 
Subcommittee held a hearing on the Job Opportunities and Basic 
Skills (JOBS) program. Experts from around the country 
testified how under this program, the emphasis has not been 
work, but instead education and training activities which too 
often have been designed with little relevance to the realities 
of the working world. Witnesses also described how the many 
statutory restrictions under the JOBS program have greatly 
hampered the ability of States to design more sensible welfare-
to-work systems which both meet their needs and allow for 
easier coordination and integration with other programs.
    As a result of this hearing and other discussions with 
interested parties from around the country, H.R. 999, the 
Welfare Reform Consolidation Act of 1995 (as reported by the 
Committee on Economic and Educational Opportunities) included 
the consolidation of the JOBS program into the larger Temporary 
Assistance for Needy Families (TANF) block grant. In its place 
welfare-to-work requirements were added which provide 
flexibility to States to implement new and innovative 
approaches at moving welfare recipients toward self-sufficiency 
utilizing funds from the overall TANF block grant.
    Further description of the Committee's activities related 
to welfare reform, including the work requirements, are 
described under the ``Full Committee Activities'' section of 
this report.

             B. COMMON SENSE SOLUTIONS IN HIGHER EDUCATION

Hearings on the rising cost of higher education

    On April 23, 1996, the Subcommittee held an initial 
overview hearing with respect to higher education. The 
witnesses provided information describing the current make-up 
of student bodies across the country. The testimony included 
information on the age, family income level, and educational 
attainment of the current student population across all sectors 
of higher education. The Committee also heard testimony as to 
the kinds of financial aid available to students at the State, 
federal and institutional levels.
    During the course of the hearings, the witnesses provided 
some startling information with respect to the rising price of 
a college education. Since 1980, the price of a college 
education has increased at double and triple, in some years, 
the rate of inflation. Statistics provided by the witnesses 
showed that the price of a college education at a private 
institution rose more than 90 percent over the past fifteen 
years in inflation adjusted terms. The price at public 
institutions rose about 100 percent for the same period. 
Unfortunately, median family income only rose 5 percent in the 
last fifteen years in inflation adjusted terms.
    A follow-up hearing held on July 18, 1996 by the 
Subcommittee took an in-depth look at the rising costs of 
college. This hearing provided insight to Members as to why 
there has been an ongoing rise in the price of a college 
education and the effect such prices are having on students and 
families struggling to pay the bill. Controlling college 
tuition increases is a top priority issue to students and 
parents across the country, and the Subcommittee felt it was 
important to have an in-depth understanding of this topic in 
preparation for the upcoming authorization of the Higher 
Education Act in the 105th Congress.

H.R. 3863, The Student Debt Reduction Act of 1996

    On July 22, 1996, Chairmen Bill Goodling and Howard P. 
``Buck'' McKeon introduced H.R. 3863, ``The Student Debt 
Reduction Act of 1996.'' H.R. 3863 amended the Higher Education 
Act to allow lenders to waive or reduce the origination fees 
imposed on Unsubsidized Stafford Loans by paying the fee on 
behalf of the student borrower. This student benefit is 
currently available only in the Subsidized Stafford Loan 
program. On August 1, 1996, the Committee on Economic and 
Educational Opportunities considered H.R. 3863, and favorably 
reported the bill by a recorded vote of 34-0. On September 10, 
1996, H.R. 3863 was considered by the House of Representatives, 
and was agreed to by a recorded vote of 414 to 1 on September 
11, 1996. Unfortunately, this important measure was not 
considered by the Senate before the 104th Congress adjourned.
    H.R. 3863 would have given students the opportunity to reap 
the benefits of competition at no cost to the federal 
government. Students would have found themselves with more cash 
in hand which could be used for books, living expenses and 
other education related costs. As the cost of a higher 
education continues to rise, every extra dollar becomes more 
and more important to students and their families.
    This bill would have promoted increased competition among 
student loan lenders, that would have resulted in lower 
interest rates and lower origination fees for students. More 
importantly, the students that would have been assisted by this 
bill would have gained considerably, using their student loan 
funds as intended to offset the costs of obtaining a college 
education rather than the cost of obtaining financial aid.

H.R. 1720, The privatization of Sallie Mae and Connie Lee

    On May 3, 1995, the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning held a hearing 
jointly with the Subcommittee on National Economic Growth, 
Natural Resources and Regulatory Affairs of the Committee on 
Government Reform and Oversight on privatizing government 
sponsored entities (GSEs). On May 25, 1995, Representative 
Howard P. ``Buck'' McKeon introduced H.R. 1720, the 
``Privatization Act of 1995'' to provide for the cessation of 
federal sponsorship of two government sponsored enterprises, 
and on June 8, 1995, the Committee on Economic and Educational 
Opportunities considered and approved H.R. 1720 by a voice 
vote.
    On September 24, 1996, the House of Representatives passed 
H.R. 1720, privatizing Student Loan Marketing Association 
(Sallie Mae) and College Construction Loan Insurance 
Association (Connie Lee). This privatization proposal received 
overwhelming bipartisan support and was included in H.R. 3610, 
the Omnibus fiscal year 1997 Appropriations bill signed into 
law by the President on September 30, 1996. It is Public Law 
104-208.
    The Committee on Economic and Educational Opportunities 
recognized that the time had come to sever the federal 
government's ties to the Student Loan Marketing Association 
(Sallie Mae) and the College Construction Loan Insurance 
Association (Connie Lee). At the same time, both companies had 
expressed a desire to become private sector businesses, without 
federal support and without federal restrictions. The Committee 
recognized that it was time to applaud the success of these 
Federally chartered companies and time to sever their federal 
ties.
    Sallie Mae was established in 1972 under a federal charter 
authorized by Part B of Title IV of the Higher Education Act. 
At that time there was a tremendous need for a secondary market 
that would purchase student loans from lenders, so that lenders 
would have sufficient capital for making new loans. Under its 
federal charter, Sallie Mae gained certain advantages, 
including the ability to raise large amounts of capital in a 
cost effective way.
    Today, there is an extremely competitive secondary market 
for student loans, and there is ample private capital. Every 
eligible student has access to student loans. Now, the federal 
charter which initially helped Sallie Mae assist students is 
hampering Sallie Mae's ability to put its expertise to work in 
the private market to provide services outside of the student 
loan arena. Clearly the time has come when it is advantageous 
to both the taxpayer and Sallie Mae to allow Sallie Mae to 
become a fully private company with no federal ties and no 
government sponsored advantages.
    Connie Lee is another example of a successful public-
private partnership which has served its purpose. Connie Lee 
was created by Congress under Title VII of the Higher Education 
Amendments of 1986. At that time, many institutions of higher 
education faced the pressing problem of deteriorating physical 
infrastructures such as buildings and physical plants. Only 
wealthier schools with the best credit ratings were able to 
finance facilities improvements at a reasonable cost. Connie 
Lee was created to underwrite the financing of these needed 
improvements for institutions with lower credit ratings, 
leveraging large amounts of capital with little risk to the 
taxpayer.
    However, Connie Lee has never enjoyed the advantages of 
most GSEs. In fact, the only government ``help'' Connie Lee 
received was start-up capital, in return for which the 
government received shares of stock. The law which created 
Connie Lee narrowly limited the company's business activities 
and clearly indicated that Connie Lee was meant to be a private 
company.
    Proceeds from privatization of Sallie Mae and Connie Lee 
will amount to several million dollars. These funds will be 
placed under the direction of the District of Columbia's 
Financial Control Board to be used for much-needed school 
construction and repairs to carry out the District of Columbia 
School Reform Act of 1995.
    The Committee believes the privatization of Sallie Mae and 
Connie Lee is good common-sense government reform. It frees the 
American taxpayer from subsidizing activities which will 
continue and flourish without federal support. It also 
demonstrates a willingness on the part of the federal 
government to take a successful public-private partnership and 
turn it into a completely private venture when government 
support is no longer necessary. The Committee's actions on 
privatization during the 104th Congress are paving the way to 
the future of a smaller, less intrusive government for all 
Americans.

H. Res. 470, Campus Crime Resolution

    On June 6, 1996, the Subcommittee on Postsecondary 
Education, Training and Life-Long Learning held a hearing on 
the issue of campus crime. Witnesses testifying at this hearing 
agreed that crime is a major concern of students, parents and 
college administrators. During this hearing, several witnesses 
called into question the Department of Education's commitment 
to enforcing compliance with the Campus Security Act. In part, 
their concerns were based on a quote by the Assistant Secretary 
for the Office of Postsecondary Education which appeared in the 
New York Times on January 7, 1996. When asked about enforcement 
of the Campus Security Act, the Assistant Secretary said: ``We 
aren't going to essentially establish a major monitoring effort 
in this area.''
    As a result of this hearing, House Resolution 470 was 
introduced by Chairmen Bill Goodling and Howard P. ``Buck'' 
McKeon on June 27, 1996, expressing a sense of the Congress 
that the Department of Education should make the monitoring of 
compliance and enforcement of the Campus Security Act a 
priority. The Campus Security Act requires institutions of 
higher education participating in the Title IV student aid 
programs to provide yearly statistics to students, faculty, and 
prospective students with respect to the number of crimes 
reported on campus in the following categories: murder, 
forcible and non-forcible sex offenses, robbery, aggravated 
assault, burglary and motor vehicle theft. In addition to the 
reporting of statistics, institutions must make timely reports 
to the campus community of those crimes considered to be a 
threat to other students and employees in order to aid in the 
prevention of further crimes on campus.
    This Committee believes it is imperative that the 
Department of Education actively enforce compliance with the 
law. In order for students to have information vital for their 
own safety on our college campuses, the Department of Education 
must make certain that institutions are complying with the 
Campus Security Act. Safety of students must be the number one 
priority.
    House Resolution 470 was favorably reported by the 
Committee on Economic and Educational Opportunities by voice 
vote on July 31, 1996. The House of Representatives passed 
House Resolution 470 on September 11, 1996 by a vote of 413 
yeas and 0 nays.

Streamlining grant eligibility for America's historically black 
        colleges and universities

    Section 326 of Title III of the Higher Education Act was 
established to provide grants to Historically Black Graduate 
and Professional Schools that make a substantial contribution 
to the legal, medical, dental, veterinary or other graduate 
education opportunities for African Americans.
    Eligibility for grant funds under Section 326 was 
originally limited to five institutions. In 1992, the list of 
eligible institutions was expanded and eleven additional 
Historically Black Graduate and Professional Schools became 
eligible for grant funds under this section. The first $12 
million appropriated for this section is reserved for the five 
original institutions who have received funding under Section 
326 since its inception. These schools, like all of the other 
eligible institutions, were restricted to two five-year grants. 
All five schools completed their second grant in fiscal year 
1996. Without this amendment to the statute, they would no 
longer be eligible for future grant funds.
    It is the Committee's finding that the survival of these 
schools contributes to the improved status of disadvantaged 
persons, as well as, all Americans. Because of the significant 
contributions of these five institutions and their graduates, 
it is important that they continue to be eligible for the grant 
support necessary to continue providing top quality education 
to their students.
    H.R. 3055 was introduced by Representatives Charlie 
Norwood, Bill Goodling, and William Clay on March 7, 1996. On 
March 14, 1996, the Committee on Economic and Educational 
Opportunities favorably reported H.R. 3055 by voice vote. On 
April 23, 1996, H.R. 3055 passed the House of Representatives 
by voice vote under the Corrections Day Calendar. H.R. 3055 
passed the Senate by voice vote on April 24, 1996, and was 
signed into law by the President on May 6, 1996. It is now 
Public Law 104-141.

Increasing the autonomy of the Institute for American Indian Arts

    The Institute for American Indian Arts (Institute) is a 
federally created institution of higher education, authorized 
under Title XV of the Higher Education Amendments of 1986. Its 
primary purposes are to provide scholarly study of and 
instruction in Indian arts and culture and to establish 
programs which culminate in the awarding of degrees in the 
various fields of Indian art and culture. Policy for the 
Institute is set by a board of trustees (Board) made up of 13 
voting members, appointed by the President with the advice and 
consent of the Senate, and 6 non-voting members, including 
Members of Congress.
    Unfortunately, the Board appointment process has proven to 
be overly cumbersome and the appointment of voting members to 
the Board has not historically been made in a timely manner. 
This has lead to a situation where Board members feel compelled 
to serve additional terms in order to maintain a quorum for the 
purposes of doing business, and has threatened the continuity 
of the Board.
    On March 7, 1996, Chairman Bill Goodling along with 
Representative Dale Kildee introduced H.R. 3049. This 
legislation would have made a simple correction to allow the 
Board to recommend successors for Board members whose terms are 
expiring and who do not wish to serve additional terms. The 
President would have the prerogative to act on these 
recommendations, or to appoint another qualified individual of 
his choosing subject to confirmation by the Senate. However, 
should the President fail to act within two months of the 
expiration of the sitting member's term, and should that member 
not wish to serve an additional term, then the individual 
recommended for appointment by the Board would be automatically 
seated.
    H.R. 3049 was favorably reported by the Committee on 
Economic and Educational Opportunities without amendment by 
voice vote on March 14, 1996. On April 23, 1996, H.R. 3049 
passed the House of Representatives by voice vote on the 
Corrections Day Calendar. Unfortunately, the Senate failed to 
act on this legislation prior to the end of the 104th Congress.

                 II. Meetings Held by the Subcommittee

104th Congress, First Session

    January 19, 1995--Oversight hearing on Job Opportunities 
and Basic Skills Act (JOBS).
    February 6, 1995--Oversight hearing on training issues.
    February 7, 1995--Oversight hearing on training issues.
    March 1, 1995--Oversight hearing on training issues.
    March 3, 1995--Oversight hearing on training issues.
    March 7, 1995--Oversight hearing on training issues.
    March 16, 1995--Oversight hearing on training issues.
    March 21, 1995--Oversight hearing on training issues.
    March 23, 1995--Oversight hearing on training issues.
    March 29, 1995--Oversight hearing on training issues.
    May 3, 1995--Joint oversight hearing on privatizing 
government sponsored entities (GSE's), held with the 
Subcommittee on National Economic Growth, Natural Resources and 
Regulatory Affairs of the Committee on Government Reform and 
Oversight.
    May 9, 1995--Oversight hearing on Title IX of the Education 
Act Amendments of 1972.
    May 17, 1995--Mark-up of H.R. 1617, ``Workforce and Career 
Development Act of 1996''.

104th Congress, Second Session

    April 23, 1996--Oversight hearing on higher education; who 
plays, who pays, who goes.
    May 31, 1996--Hearing on H.R. 2428, The Good Samaritan Food 
Donation Act.
    June 6, 1996--Hearing on H.R. 2416, Open Campus Police Logs 
Act of 1995.
    July 18, 1996--Oversight hearing on the rising cost of 
college.

                      III. Legislative Activities

                    A. Legislation Enacted into Law

    P.L. 104-210 (H.R. 2428), ``Bill Emerson Good Samaritan 
Food Donation Bill''.

           B. Legislation Enacted as Part of Another Measure

    H.R. 1617, ``Workforce and Career Development Act''. 
Provisions of the bill were included in H.R. 3610 and enacted 
as P.L. 104-208.
    H.R. 2396, ``Congressional Award Act Amendments of 1995'', 
was included in H.R. 3610 and enacted as P.L. 104-208.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act'', was included in H.R. 4036 and enacted as P.L. 
104-319.
    S. 1267, ``Congressional Award Act Amendments of 1995'', 
was included in H.R. 3610 and enacted as P.L. 104-208.

                    C. Legislation Passed the House

    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 2428, to encourage the donation of food and grocery 
products to nonprofit organizations for distribution to needy 
individuals by giving the Model Good Samaritan Food Donation 
Act the full force and effect of law.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act''.

           D. Legislation Passed the House in Another Measure

    H.R. 1617, ``Workforce and Career Development Act of 
1996'', passed the House in S. 1972.
    H.R. 2332, ``Consolidated and Reformed Education, 
Employment, and Rehabilitation Systems Act'' or ``CAREERS 
Act''. Provisions of the bill passed the House in H.R. 1617.
    H.R. 3803, ``George Bush School of Government and Public 
Service Act'', passed the House in H.R. 4036.

                   E. Legislation With Filed Reports

    H.R. 1617, (H.Rept. 104-152), ``Workforce and Career 
Development Act of 1996''.
    H.R. 2428, (H.Rept. 104-661), to encourage the donation of 
food and grocery products to nonprofit organizations for 
distribution to needy individuals by giving the Model Good 
Samaritan Food Donation Act the full force and effect of law.

          F. Legislation Ordered Reported from Full Committee

    H.R. 1617, ``Workforce and Career Development Act of 
1996''.
    H.R. 2428, to encourage the donation of food and grocery 
products to nonprofit organizations for distribution to needy 
individuals by giving the Model Good Samaritan Food Donation 
Act the full force and effect of law.

               G. Legislation Reported from Subcommittee

    H.R. 1617, ``Workforce and Career Development Act of 
1996''.

              H. Legislation Discharged from Subcommittee

    H.R. 2428, to encourage the donation of food and grocery 
products to nonprofit organizations for distribution to needy 
individuals by giving the Model Good Samaritan Food Donation 
Act the full force and effect of law.

                         I. Legislation Vetoed

    None of the legislation referred to Subcommittee was 
vetoed.

                      IV. Subcommittee Statistics

Total Number of Bills and Resolutions Referred to Subcommittee....    77
Total Number of Bills Discharged from Subcommittee................     1
Total Number of Subcommittee Hearings.............................    16
    Field.........................................................     0
    Joint with Other Committees...................................     1
Total Number of Subcommittee Mark-Up Sessions.....................     1
Total Number of Bills Reported from Subcommittee..................     1
Total Number of Bills Ordered Reported from Full Committee........     2
Total Number of Filed Reports on Bills............................     2
Total Number of Bills Passed the House............................     3
Total Number of Bills Passed the House in Another Measure.........     3
Total Number of Bills Enacted into Law............................     1
Total Number of Bills Enacted as Part of Another Measure..........     4
Total Number of Bills Vetoed......................................     0

                      Oversight and Investigations

    During the 104th Congress, the Committee on Economic and 
Educational Opportunities (Committee) and more specifically its 
Subcommittee on Oversight and Investigations (Subcommittee) 
began to examine the role of the federal government and its 
effectiveness in meeting Congressionally mandated goals. 
Consistent with the Members' desire to balance the budget and 
to ensure the appropriate use of taxpayer money, the Committee 
and Subcommittee initiated intensive oversight of those 
programs, agencies, and departments within the Committee's 
jurisdiction.
    More particularly, the Committee initiated several major 
inquiries into the activities of the Departments of Labor and 
Education, the Corporation for National Service, the National 
Labor Relations Board, and other agencies under the Committee's 
jurisdiction. These inquiries were consistent with the 
Committee's Oversight Plan which was adopted by the Committee 
on February 7, 1995 and submitted to the Committee on 
Government Reform and Oversight and the Committee on House 
Oversight on February 15, 1995.
    The central focus of the Committee's Oversight Plan was to 
ensure that programs, agencies, departments, laws, and 
regulations under the Committee's jurisdiction:
        A. Focus on an appropriate federal mission;
        B. Work effectively and efficiently;
        C. Consistently follow Congressional intent;
        D. Establish a framework for policy initiatives that 
        will create an environment for life long learning and 
        effective workplace policy; and,
        E. Provide for a role for the federal government, only 
        where absolutely necessary.
    The following sections of this Activities Report of the 
Committee are filed pursuant to and comply with Rule XI, clause 
1(d)(1) of the Rules of the House of Representatives and detail 
the oversight activities of the Committee in accordance with 
the five specific goals listed above. While several of the 
oversight activities of the Committee and Subcommittee could 
easily fall under more than one category, this report places 
each activity according to its primary objective.

                        I. Summary of Activities

                     A. Appropriate Federal Mission

    During the 104th Congress, the Subcommittee conducted a 
series of evaluations, hearings, and investigations into 
AmeriCorps, the Federal Direct Student Loan Program (FDSLP), 
and the National Endowment for the Arts (NEA). These programs 
and agencies were examined in an effort to fulfill one of the 
major functions of the Subcommittee, namely, whether or not 
these programs and agencies serve an appropriate federal 
mission. In other words, should the federal government be 
paying for volunteers, involved in banking and loan activities 
related to student educational loans, and funding questionable 
activities under the guise of ``the arts.'' Accordingly, set 
forth below is a brief analysis of the Subcommittee's 
activities and related findings where appropriate.

Findings on the Corporation for National Service

    Failed Audit.--When the establishment of the Corporation 
for National Service (Corporation) was originally debated, the 
President promised that the ``national service corporation will 
be run like a big venture capital outfit, not like a 
bureaucracy.'' In the same vein, Harris Wofford, Chief 
Executive Officer of the Corporation, continually described his 
organization in business terms--``market driven'' and ``based 
in the independent sector.'' The mission statement of the 
Corporation even states that it would be a ``model enterprise, 
not just for government, but for many sectors of society.''
    Unfortunately, in the middle of the Corporation's first 
statutorily required financial audit by Arthur Anderson, LLP 
and Williams, Adley & Co., LLP, they determined that, due to 
weaknesses in the Corporation's financial systems, accounting 
records, and management controls, it would not be possible to 
perform an audit of the Corporation's fiscal year 1994 
financial records. In other words, the Corporation's books were 
determined to be unauditable--hardly a well-oiled ``venture 
capital outfit.''
    In testimony before the Subcommittee, the lead auditor 
classified the Corporation's accounting and management control 
weaknesses into six broad categories. According to the 
auditors, the Corporation 1) lacks strong management controls, 
2) lacks data integrity, 3) lacks data security, 4) failed to 
segregate accounting duties, 5) lacks budgetary controls, and 
6) could not prepare reliable financial statements. In all, the 
auditors reported that the Corporation had 99 accounting 
weaknesses, 34 of which the auditors determined to be material.
    One of the witnesses from a private sector financial 
institute that reviewed the Corporation's financial statements 
noted that ``a third of the items [$168 million out of $343 
million] on the statements are described in such a fashion that 
if I went back to Wall Street and told this story, people would 
laugh, but I could not laugh because I think it is too 
serious.'' During this same hearing, Harris Wofford, the Chief 
Executive Officer of the Corporation concurred with the 
seriousness of the problem and assured the Subcommittee that he 
would take every step possible to solve these problems.
    In a follow-up hearing on this matter, the Corporation 
again testified to the importance of fixing the problems 
detailed by the auditors. Unfortunately, the Corporation now 
estimates that at least one more year of its financial records 
will be unauditable. A review by the Subcommittee staff (in 
consultation with outside experts), of the Corporation's 
progress to date and of its timelines for implementing 
corrective changes pursuant to the auditor's recommendations, 
makes this assurance seem overly optimistic. As noted in the 
Subcommittee's hearing of March 19, 1996, lack of financial 
controls makes it impossible for the auditors to determine if 
the Corporation or any of its staff is misusing taxpayer money.
    Funding.--As a result of the Subcommittee's systematic 
review, the Subcommittee determined that the Corporation 
received an additional $40.8 million in direct federal money 
through various interagency agreements with other Executive 
Branch agencies and departments. This is an amount equal to 20 
percent of the Corporation's fiscal year 1994 appropriation, 
excluding its educational trust.
    This fact raised serious concerns. For example, the work of 
the Members of this Committee, which have legislative and 
oversight responsibility over the Corporation, could be 
subverted by the increased reliance on other federal entities. 
More broadly, the web of federal funding sources for the 
Corporation has the effect of quelling Congressional oversight 
generally by spreading the appropriated amounts across several 
authorizing Committees. Because the spending by any individual 
department or agency on the Corporation, when viewed 
separately, is relatively small, the Committees authorizing 
those funds may have little incentive (or knowledge) to closely 
monitor the activities carried out with those funds.
    While the Subcommittee requested from the Corporation and 
reviewed copies of what it believed were all the interagency 
agreements between the Corporation and other federal agencies, 
it was not until the Subcommittee received a complaint from the 
San Francisco Public Housing Authority, that the Subcommittee 
learned of the existence of the interagency agreements that 
require private or local spending on AmeriCorps or AmeriCorps 
type activities. These agreements call for the Corporation to 
receive $690,811 from the Department of Housing and Urban 
Development (HUD), and in return the Corporation provides HUD 
with staff time and educational awards valued at over $1.5 
million.
    The size of the commitment on the part of the Corporation 
raised serious concerns. Most importantly, how did the 
Corporation intend to fund this obligation? The Subcommittee 
learned that the Corporation, through similar agreements, had 
been given exclusive veto power over the $1.3 billion 
appropriated under HOPE VI--the Urban Revitalization 
Demonstration Program (Program). Under the Program, the San 
Francisco Public Housing Authority must use 7 to 10 percent of 
its funding for ``community service.'' While the Program does 
not identify AmeriCorps specifically, the San Francisco Public 
Housing Authority testified that they felt pressured to utilize 
AmeriCorps so as to ease the approval process because the 
Corporation is the gatekeeper to HOPE VI funds.
    The investigation into this area led the Corporation, under 
an agreement with Senator Grassley, to end its practice of 
operating AmeriCorps programs directly with other federal 
agencies and departments. However, because the Corporation was 
still managing to utilize these federal resources indirectly, 
the Omnibus Consolidated Appropriations Act of 1996, P.L. 104-
208, Section 314, included specific language requiring any 
federal agency seeking to provide funding to the Corporation to 
seek approval of a reprogramming request.
    Per Member Costs.--On June 30, 1995, the Subcommittee 
announced its initial findings that the cost to the American 
taxpayer per AmeriCorps member was $27,749 per year. In 
particular, the Subcommittee found that federal programs had 
budgeted costs that ranged from a low of $17,362 to $51,509 per 
member--well above the amounts projected when the Corporation 
was created. In fact, former Chief Executive Officer of the 
Corporation, Eli Segal, testified that per member costs were 
just under $20,000.
    Two months later, the General Accounting Office (GAO) 
released its report on the cost of AmeriCorps. That report 
demonstrated that total spending per member ranged from $25,797 
to $31,017. This report went a step further and noted that 
costs in the AmeriCorps program equaled $16 per hour of 
AmeriCorps service. Finally, this report noted that AmeriCorps 
was funded almost entirely with public funds. While fully 78 
percent came from the federal government, an additional 15 
percent was provided out of State and local tax receipts. In 
short, despite being created as a public/private partnership, 
93 percent of AmeriCorps funding was provided by government 
funding.
    Wasteful Spending.--As a result of the extraordinary costs 
attributed to AmeriCorps members, the Subcommittee conducted a 
review of the line by line budget items of federal AmeriCorps 
grantees. In particular, the Subcommittee found uniform costs 
varying from $151 per member at the Department of the Interior, 
to almost $1,500 per member at the Department of the Navy. 
Spending on travel and transportation ranged from $148 per 
member at the Department of Transportation to almost $3,000 at 
the Environmental Protection Agency. Additionally, the 
Subcommittee found over $3.5 million budgeted in unspecified 
accounts or ``other.'' The Navy budgeted over $13,000 per 
member in such an account, while the National Endowment for the 
Arts budgeted $5,600 per member. In all, over $1,500 per member 
was budgeted in ``other'' accounts.
    The Subcommittee also uncovered the fact that the 
Corporation spent large amounts of money on ``training and 
technical assistance'' grants. In particular, the Subcommittee 
uncovered one such contract with the AFL-CIO which amounted to 
$400,000. Other contractors included the Multicultural 
Institute and the National Association of Community Mediation. 
In total, the Subcommittee found that the Corporation had spent 
almost $13 million on such contracts--the equivalent of over 
700 AmeriCorps members.
    At the same time, the Subcommittee found that the 
Corporation was operating a Leadership Training Center at the 
Presidio, an area overlooking the San Francisco Bay and the 
Golden Gate Bridge. Complete with two golf courses, the 
Presidio Leadership Center is designed to ``equip community 
leaders with proven management skills.'' The Subcommittee also 
investigated possible illegal activities at the Presidio 
Leadership Center which involved customized corporate 
training--an activity outside the scope of the Corporation's 
authorization. The cost for this new center is expected to 
exceed $1 million in 1996.
    The Subcommittee's investigation into these areas is 
ongoing and has already resulted in the Corporation reviewing 
its spending and agreeing to reduce its per member costs. In 
addition, the Corporation's questionable expenditures have 
resulted in the Office of the Inspector General (OIG) 
initiating financial reviews into several expenditures of the 
Corporation.
    National Identity Expenditures.--The Subcommittee also 
initiated a review into some of the activities of AmeriCorps 
grantees. The Subcommittee uncovered large amounts of taxpayer 
funds being expended to promote the ``national identity'' of 
the Corporation. Such expenditures include the hiring of public 
relations firms and the purchase of ``palm cards, site signs 
and uniforms'' (which included T-shirts, jackets, sweat suits, 
work clothes, and many other items procured through the 
Corporation, each emblazoned with the Corporation's official 
seal).
    In addition, Americorps members are encouraged to ``work'' 
with the media and the Corporation published a ``Guide to 
Working With the Media.'' Additionally, members are encouraged 
to write op-eds, appear on local TV and radio stations, and 
work to include their local Members of Congress. Such an 
emphasis appears to be more targeted at ``getting seen,'' 
rather than at ``getting things done,'' which is not only 
AmeriCorps' motto, but is the appropriate way to carry out 
service to one's community.
    The Subcommittee's investigation into this matter led the 
Corporation to agree to end its requirement to have members 
wear uniforms. They have also stated that they will review 
their ``national identity'' activities generally. Despite this 
fact, the Subcommittee continues to see wasteful spending in 
these areas.
    Political Activities.--Finally, the OIG and the 
Subcommittee independently found evidence of political activity 
by grantees of the Corporation. Most notable in this regard is 
the OIG's findings on the apparent cross-over funding between 
ACORN, a political advocacy group and ACORN Housing Corp. 
(AHC), a non profit, AmeriCorps grantee. The OIG recommended, 
and the Corporation agreed, to suspend AHC's funding after it 
was learned that AHC and ACORN shared office space and 
equipment and failed to assure that activities and funds were 
wholly separate. The Subcommittee held a hearing on this matter 
where it was revealed that AmeriCorps members of AHC raised 
funds for ACORN, performed voter registration activities, and 
gave partisan speeches. In one instance, an AmeriCorps member 
was directed by ACORN staff to assist the White House in 
preparing a press conference in support of legislation. 
AmeriCorps members were also directed to encourage their 
clients to lobby on behalf of legislation.
    On the heels of the ACORN investigation, the OIG also 
uncovered illegal political activities by the Coal Coalition, 
an AmeriCorps program in Colorado that was improperly 
distributing political flyers. In the same vein, another 
AmeriCorps program, the Border Volunteer Corps (BVC) in Tucson, 
Arizona was found to have also distributed politically partisan 
newsletters. These programs were also stripped of Corporation 
funding. Since the BVC, the Coal Coalition, and AHC were all 
relatively large AmeriCorps grantees--the Subcommittee is 
concerned about the oversight and direction of AmeriCorps' 
funding and activities.
    The Subcommittee also identified activities which included 
voter registration drives, get out the vote campaigns, 
``national election'' activities, and participation in a Maxine 
Waters Day of Caring by AmeriCorps volunteers. Most troubling, 
however, is the continued presence of AmeriCorps members at 
political rallies and speeches after the assurance of the 
former Chief Executive Officer of the Corporation, Eli Segal, 
that such participation would cease. AmeriCorps' presence at 
such events gives the impression of political support and would 
give the appearance of impropriety.
    Misuse of Funds.--Concerns over AmeriCorps' costs are 
further compounded by several audits conducted by the 
Corporation's OIG. These reports have detailed the findings of 
audits and investigations of several of the larger grantees of 
the Corporation. Some salient examples include $95,000 in 
questioned costs at AHC and $190,000 at BVC. In the latter 
case, BVC was found to have purchased a $12,000 car (gas and 
maintenance), paid commuting charges for employees, paid for 
four trips to Mexico for the Director who was paid $85,000 per 
year--over $45,000 more than his predecessor and 50 percent 
higher than comparable Directors in AmeriCorps funded programs.

National Endowment for the Arts

    Authorization for the National Endowment for the Arts (NEA) 
expired at the end of fiscal year 1993. However, funding for 
the NEA has continued to be appropriated on a yearly basis, but 
no authorizing legislation has been enacted primarily due to 
controversy surrounding a number of artists and projects funded 
by the NEA.
    The Subcommittee reviewed art projects currently being 
funded through the NEA, including a review of the NEA's grant 
notices, its annual reports, certain grant documents, copies of 
videos prepared with NEA funds, and site visits to museums 
where NEA funded art is being displayed. While this review is 
ongoing, several of the Subcommittee's findings raise serious 
questions about the current activities of the NEA. For example, 
on June 14, 1996, the Subcommittee requested a copy of the film 
``Watermelon Woman'' and all related grant information from the 
NEA. This film portrays graphic homosexual sex, is strewn with 
graphic and degrading sexual language, and portrays illegal use 
of drugs as casual.
    The Subcommittee is committed to continuing its review of 
art funded through the NEA. This information will assist 
Congress and the public in determining if funding the NEA is an 
appropriate expenditure of taxpayer money.

The Federal Direct Student Loan Program

    The Subcommittee followed certain principles in reviewing 
federal education programs. One of the chief tenants of the 
Subcommittee is ensuring that federal education programs focus 
on an appropriate federal mission. Accordingly, the 
Subcommittee analyzed whether or not it is appropriate for the 
Department of Education to be, in effect, one of the largest 
banks in the United States.
    Under the Federal Direct Student Loan Program (FDSLP) the 
federal government has taken on the responsibility to act as a 
bank for millions of students throughout this nation. In light 
of this new role the Subcommittee held hearings on the two 
major federal student loan programs, Federal Family Education 
Loans (FFELP) and FDSLP.
    The FDSLP began in 1993. Since its inception, there has 
been fierce debate in Congress regarding the FDSLP. This debate 
involves: 1) the tremendous number of federal employees 
necessary to administer FDLSP, 2) the huge federal expense 
involved in FDLSP's operation, 3) whether FDLSP is a more 
effective and efficient way to provide educational loans to 
students, and 4) whether the FDLSP performs a necessary and 
appropriate federal function. The Subcommittee also raised 
concerns about the direct involvement of the federal government 
in the program, particularly in light of the devolution of 
power and responsibility to State and local officials.
    On May 23, 1995, the Subcommittee held a hearing on the 
FDSLP. One of the most significant issues that came to light 
during the May 23rd hearing was that a number of schools 
expressed their position that the FDSLP is unnecessary and that 
they were pleased with the FFELP. In this regard, a letter from 
the Director of Financial Aid at the University of Nebraska at 
Kearney stated the general opinion of many, when he said, ``we 
have chosen not to apply for the Direct Lending Program due to 
the fact that we have an exceptionally efficient process 
currently in place with the Federal Stafford Loan Program.'' In 
light of this and other similar letters, the Subcommittee 
continues to be concerned with why the 103rd Congress created 
the FDLSP which required the hiring of hundreds of federal 
employees and billions of dollars in new expenditures by the 
Department of Education.
    Moreover, since the hearing, the Subcommittee uncovered a 
number of alarming and potentially devastating problems with 
the FDSLP. For example, the Subcommittee found information 
demonstrating that the Department of Education pushed back 
reporting requirements for schools. Consequently, the 
Department of Education will not receive timely and critical 
information about students and their loans. There are a number 
of schools that have failed to produce Student Status 
Confirmation Reports for their students who are in the FDSLP. 
Therefore, those students will not be placed in loan repayment 
in a timely manner.
    These problems raise a number of significant concerns 
regarding the implementation of the FDSLP. First, the 
Department of Education, which contracts with various 
independent for-profit companies for billions of dollars in 
services, is not collecting necessary data in a timely fashion. 
For example, questions have arisen regarding the data 
maintained on matters, such as whether a student continues to 
be enrolled at an institution. Second, the General Accounting 
Office, the Department of Education's Office of the Inspector 
General, and the Advisory Committee on Student Financial 
Assistance concluded that the Department of Education lacks the 
technical expertise and experience to administer complicated 
contracts for services which are vital to the operation of the 
FDSLP. As a result, the Subcommittee is gravely concerned that 
some students are and will continue to be hurt by the 
inadequacies of the FDLSP and, ultimately, the taxpayer is left 
to pay the bill when these students default on the repayment of 
their student loans.
    The information vacuum that the Subcommittee has observed 
in the FDLSP does not exist in the FFELP because the reporting 
requirements differ. In addition, the FFELP has become 
considerably stronger over the last few years and has responded 
well to competition. The guaranty agencies, lenders, and 
secondary markets have become more responsive to the needs of 
students and schools as evidenced by electronic loan processing 
and 24 hour turnaround for applications.
    The Department of Education has become an advocate against 
this public/private student loan partnership. It has stymied 
improvements that would benefit students and schools alike in 
order to garner a larger share of the student loan market for 
the FDSLP. It has also attempted to establish an environment 
where schools feel compelled to join the FDSLP. But, despite 
the Department of Education's efforts nearly 100 postsecondary 
schools, approved by the Department of Education to participate 
in the third year of its FDSLP, have dropped out since May, 
1996. Finally, the Subcommittee has been in frequent contact 
with the Department of Education's Office of the Inspector 
General, which is near completion of an audit of FDSLP, using 
16 schools selected at random and 7 schools selected as 
potential problem schools. The audits will be comprehensive and 
focus on the various aspects of the program and potential areas 
of weakness.

                  B. Works Effectively and Efficiently

    The federal government can no longer take a laissez faire 
attitude with regard to the manner in which it spends taxpayer 
dollars. Indeed, taxpayers are demanding that the federal 
government utilize its scarce federal dollars in an efficient 
and effective manner. In this regard, the Subcommittee examined 
several matters that equate to an apparent disregard for the 
basic principles of efficiency and effectiveness. In this 
report, the National Labor Relations Board is examined in terms 
of, among other things, its adjudicatory practices, and travel 
policies. In addition, the circumstances leading to the 
decision of Clinton Administration officials at the Department 
of Labor to expend unnecessarily almost $32,000 is also 
examined in detail.

The National Labor Relations Board's increased use of 10(j) injunctions

    The National Labor Relations Board (NLRB/Board) has 
dramatically increased its use of 10(j) injunction authority 
against employers. As the filing of 10(j) petitions became more 
commonplace under Chairman William Gould's and General Counsel 
Fred Feinstein's NLRB, serious due process concerns and 
questions about the use of NLRB procedures to assist unions 
have been raised including concerns about the Board's 
impartiality and neutrality.
    The NLRB's 83 10(j) authorizations in fiscal year 1994 
represent an increase of nearly 100 percent over the 42 
authorizations issued in fiscal year 1993, and an increase of 
more than 300 percent over the 26 authorizations issued in 
fiscal year 1992. The NLRB has become even more zealous in its 
use of the 10(j) injunction. Between January 1, 1994, and June 
13, 1995, the NLRB authorized the pursuit of injunctive relief 
in 162 cases. The impact of increases in 10(j) cases is 
significant in terms of time, energy, and money. This is 
illustrated by the fact that the NLRB:
          Devotes approximately 34 staff days to process each 
        10(j) injunction and
          Spends more than $10,000 to process each injunction.
    Accordingly, the NLRB spent an estimated $452,408 to 
process 44 authorizations during a 13-month period and an 
estimated $1,337,945 to process 127 authorizations from a 
second 12-month period.
    Evidence strongly suggests the NLRB is deliberately using 
its 10(j) authority to force employers to settle unfair labor 
practice charges. Former NLRB General Counsel Collyer stated at 
a hearing that the NLRB's agenda has compromised its procedures 
and has led to a ``rush to judgment.'' Such a ``rush to 
judgment'' undermines the NLRB's legitimate responsibilities 
and disregards a party's presumption of innocence.

Travel practices at the National Labor Relations Board

    It is well accepted that the individuals who are 
responsible for the operation of a federal entity find it 
necessary to travel from time to time and accept invitations 
from around the country to discuss issues critical to the 
business of that entity. But one would not expect high-level 
government officials to abuse this authority in the face of 
scarce federal dollars.
    Forty-five thousand dollars ($45,000) in federal funds was 
expended by the Board for the period of March 1994 through 
March 1995. A major portion of those funds were expended by 
Chairman Gould.
    During this same period, Board members traveled together, 
as well as independently, to such locations as Vancouver, 
British Columbia; London, England; Johannesburg, South Africa; 
Nassau, Bahamas; Rome, Italy; San Juan, Puerto Rico; and 
Taipei, Taiwan.
    Of the number of trips taken by Board members, none 
warranted as much attention as that enjoyed by NLRB members 
Cohen, Truesdale, and Stephens. During the winter months of 
February 18 through March 2, 1995, these three Board members 
traveled to Kahului, Maui, for the American Bar Association 
(ABA) conference on practice and procedure and then continued 
on to Key West, Florida, to attend another ABA-sponsored 
conference on developing a labor law committee. The combined 
cost of this travel to the American taxpayer was almost 
$10,000.
            The South Africa trip
    In May 1994, the people of South Africa selected a new 
leader--Nelson Mandela. After the election, an inauguration was 
scheduled that was attended by Chairman Gould.
    Several days before the scheduled inauguration date 
Chairman Gould had not received an invitation to the 
ceremonies. As a result, he contacted Mr. Trevor Wentzel of the 
Ravensmead Workers Advice Bureau in South Africa regarding the 
fact that he had not received an invitation to the 
inauguration. In response to this communique, Mr. Wentzel, at 
4:19 p.m. on May 6, 1994, provided Chairman Gould an 
invitation. Shortly after receiving the invitation, Chairman 
Gould purchased a ticket for Johannesburg, South Africa, at a 
cost of about $4,000 to the taxpayers.
    Therefore, not only did NLRB Chairman Gould solicit an 
invitation to the inauguration of Nelson Mandela, but he spent 
approximately $4,000 in taxpayer funds to attend that function.
            Chairman Gould's reimbursement from non-federal sources
    There are a series of ethical rules, standards, and 
regulations concerning the payment of a federal employee's 
travel expenses by an outside, private party. The Subcommittee 
discovered that Chairman Gould had accepted travel expenses 
from, among others, the AFL-CIO--a consortium of labor unions 
that made more than 20,000 filings with the NLRB in 1993 alone.
    In an effort to determine the propriety of the receipt of 
such travel expenses by Chairman Gould and the NLRB, the 
Subcommittee requested a legal opinion from the Congressional 
Research Service (CRS) regarding the propriety of the receipt 
of travel funds from an organization that regularly has matters 
adjudicated by the NLRB. Among the important points made by the 
CRS was the following:
          Under regulations promulgated by the General Services 
        Administration [GSA], the agency may accept travel 
        expenses for a meeting or similar function ``which the 
        employee has been authorized to attend in an official 
        capacity on behalf of the employing agency.'' 41 C.F.R 
        Sec. 304-1.3(a) (1996). A ``meeting or similar 
        function'' includes a ``conference, seminar, speaking 
        engagement, symposium, training course, or similar 
        event that takes place away from the employee's 
        official station, and is sponsored or co-sponsored by a 
        non-federal source.'' 41 C.F.R. Sec. 304-1.2(c)(3) 
        (1996). There is within the GSA regulations a 
        ``conflict of interest'' provision which directs 
        agencies not to approve private reimbursement for 
        travel if acceptance ``would cause a reasonable person 
        with knowledge of all the facts relevant to a 
        particular case to question the integrity of agency 
        programs and operations.'' 41 C.F.R. 304 Sec. 304-1.5 
        (1996). In addition to considering the identity of the 
        source, the purpose of the meeting and the value and 
        character of the travel expenses provided, the agency 
        should consider in making such conflict of interest 
        determinations the ``nature and sensitivity of any 
        matter pending at the agency affecting the interests'' 
        of non-federal source of payments and the significance 
        of the employee's role in such a matter. 41 C.F.R. 
        Sec. 304-1.5(a)(1)-(6) (1996). Such conflict of 
        interest and ethics determinations, since they involve 
        subjective judgments and issues of appearances relating 
        to an agency's own mission and functions, as well as 
        the specific duties and functions of one of its 
        employees or officials, are the types of matters that 
        have generally been found to be administrative 
        determinations within the specific discretion and 
        expertise of the agency itself.
    Based on this language, it appears that Chairman Gould's 
decision to accept travel funds and expenditures from the AFL-
CIO, at a minimum, presents itself as a conflict of interest. 
The AFL-CIO is a consortium of some of the largest and most 
powerful members of organized labor in the United States. To 
accept their funds and later adjudicate their issues is 
inappropriate on its face and calls into question the integrity 
of certain NLRB actions.
    In addition, according to travel logs provided by the NLRB, 
Chairman Gould has traveled outside the Washington, D.C. area 
on official business 51 times during his 2\1/2\-year tenure at 
the NLRB. Equally disturbing is the fact that while on this 
``official'' NLRB travel, Chairman Gould attended 42 separate 
sporting events, including 5 professional basketball games, 5 
college baseball games, 31 professional baseball games, and the 
1996 Major League All Star game.
    The freedom with which the NLRB, including its Chairman, 
spends taxpayer dollars--whether it be on an ABA meeting in 
Hawaii during the winter months or the Chairman soliciting an 
invitation to the inauguration of Nelson Mandela in South 
Africa and later attending that function, calls into question 
the ability of this NLRB to act as good stewards of federal 
funds.

Corporate campaigns

    John Sweeney, President of the AFL-CIO, declared a new 
direction for the international labor unions that the 
Federation represents. Mr. Sweeney declared that labor would 
become far more militant in the pursuit of organizing and 
collective bargaining objectives. The term used to organize 
formally non-union corporations became known as ``corporate 
campaigns.''
    A ``corporate campaign'' has several distinct elements. Two 
of the most prominent elements are: having the target company 
perceived negatively by the company's investors, customers, 
employees and the public, and initiating enforcement and 
oversight actions by federal, State, and local governmental 
agencies. In other words, organized labor in a ``corporate 
campaign'' does not necessarily target the employees of the 
corporation as it had done historically, but rather focuses on 
corporate management. Perhaps Stephen Lerner, Organizing 
Director of the Service Employees International Union said it 
best--

          Instead of asking, `How do we win a majority of 
        (employee) votes?', we should be asking, `How do we 
        develop power to force employers to recognize the union 
        and sign a contract.'

    During the course of the 104th Congress many concerns were 
raised by targeted corporations regarding the tactics used by 
organized labor and their attendant relationship with the NLRB. 
Employers argued that the NLRB was favoring organized labor and 
was indeed a willing pawn in the ``corporate campaign'' 
strategy. As a result of these repeated and serious 
allegations, the Subcommittee conducted two hearings and one 
round-table discussion.
    The first hearing held by the Subcommittee invited NLRB 
Chairman Gould, General Counsel Feinstein, and a variety of 
small and large employers to recount their personal 
experiences. The second hearing held by the Subcommittee 
focused on the ``corporate campaign'' technique of salting--the 
placing of professional union organizers or members in a 
nonunion facility to harass or disrupt contractor operations, 
to increase costs, or to organize.
    These two hearings raised a number of concerns for the 
Subcommittee including the following:
          Organizing nonunion employees into a unified union 
        membership is not necessarily the objective of union 
        organizers;
          Resources are not an obstacle for the unions when it 
        comes to public relations;
          The cost of frivolous complaints and other federal 
        agency charges fall on the businesses and the federal 
        taxpayer while the unions have no direct accountability 
        or cost; and
          Jeopardizing jobs and employer viability is 
        ultimately more important than ensuring that workers 
        have good wages, safe worksites and fulfilling jobs.
    In conclusion, the pursuit of injunctive relief, the NLRB's 
handling of ``salting'' cases and the public comments of the 
NLRB Chairman have served as ample evidence that the NLRB may 
be biased against the regulated employer community.

Partisanship, partiality and the declining stature of the National 
        Labor Relations Board

    During the past four years, the National Labor Relations 
Board (NLRB/Board) has received harsh criticism from U.S. 
Courts of Appeals for the legal reasoning underlying its 
rulings in several key cases. As the percentage of NLRB orders 
affirmed by federal appellate courts has sunk to all-time lows 
the current NLRB has ignored past NLRB and court precedent and 
has sidestepped key factual issues to reach outcomes that have 
been soundly rejected by appeals courts. Warren, Gorham & 
Lamont, Inside Labor Relations, (May 31, 1996). Similarly, in 
numerous NLRB requests for injunctive relief, federal district 
courts have also been unpersuaded by the NLRB's legal and 
factual conclusions in seeking preliminary remedies. While 
admittedly past NLRBs have also been admonished by the federal 
courts, the Committee was struck by the force of the strident 
criticism leveled at the Gould-Feinstein NLRB by federal 
judges.
            The Perdue decision
    In a case involving an attempt by the United Food & 
Commercial Workers Union (UFCW) to organize employees at a 
facility owned by Perdue Farms, an employer had to resort to 
the highly unusual move of seeking injunctive relief in a U.S. 
district court to prevent the NLRB from persisting in moving 
toward ordering a third election at its facilities. The 
employer took this move after its employees rejected union 
representation by significant margins in two elections and 
after the NLRB largely ignored evidence of massive fraud in the 
collection of authorization cards and continued processing 
objections by the UFCW which would possibly lead to a third 
election. In scathing terms, the district court granted the 
employer's request and enjoined the NLRB from proceeding 
further in the matter until it had proven to the court that it 
had conducted an appropriate investigation into the allegations 
of fraud. The language of the court's opinion is notable for 
its harshness regarding the NLRB's conduct:

          At present, the only possible explanation for the 
        NLRB's behavior is the one proposed by the employer: 
        ``that the Board is manipulating its election rules 
        capriciously in order to foster the interests of the 
        United Food & Commercial Workers Union.'' Perdue Farms, 
        Inc. v. Nat'l Labor Relations Bd., 935 F. Supp. 713, 
        721 (E.D. N.C. 1996).
          Thus, as the cases demonstrate, the Board has not 
        only abandoned its Casehandling Manual, but no less 
        than three times where this particular Union local is 
        involved, its legal policy as well. Such dramatic 
        reversals tend to create an appearance of partisanship 
        the Board can ill afford if it hopes to retain a 
        supervisory role over labor relations. 935 F. Supp. At 
        722 (emphasis added).
          Yet the legal policy reversals do not reveal the full 
        extent of the Board's efforts on behalf of the Union. . 
        . . 935 F. Supp. At 722 (emphasis added).
          . . . The Board refuses to obey this statutory duty 
        by defying numerous guidelines and regulations, 
        engaging a significant policy departure which remains 
        unexplained. This occurs against the backdrop of [sic] 
        several legal policy reversals by the Board in favor of 
        the Union, a representation to the plaintiff by a Board 
        field examiner that the current hearing is a sham, and 
        ignorance of the plaintiff's FOIA requests sufficient 
        to invoke district court jurisdiction over that 
        dispute. 935 F. Supp. At 725 (emphasis added).

    The strength of the district court's condemnation of the 
NLRB's handling of the Perdue election is troubling to the 
Subcommittee because of the message it sends to both employers 
and employees as to the fairness and effectiveness of the 
NLRB's processes for administering the NLRA. While in isolation 
the Perdue decision might be an unfortunate footnote to the 
Gould-Feinstein tenure at the NLRB, there have been similar 
decisions in which the federal courts have expressed profound 
objections to the NLRB's handling of both representation and 
unfair labor practice cases.
            Other court decisions
    In a series of decisions, the Fourth Circuit Court of 
Appeals twice had to admonish the NLRB to cease its attempts to 
revive a representation proceeding and election at a facility 
owned by the Lundy Packing Company. The case involved a 
bargaining unit determination in which the employer was 
contending that the NLRB had improperly excluded industrial 
engineers from a unit of production and maintenance employees. 
The Fourth Circuit agreed with the employer and determined that 
the ``NLRB's bargaining unit determination both contravened its 
own announced standards and accorded controlling weight to the 
extent of union organization at Lundy, thereby violating 
section 9(c)(5) of the National Labor Relations Act,'' which 
specifically prohibits such a factor from being dispositive. In 
cautioning the NLRB, the court remarked:

          The deference owed the Board as the primary guardian 
        of the bargaining process is well established. It will 
        not extend, however, to the point where the boundaries 
        of the Act are plainly breached.

The court then denied enforcement of the NLRB's order that the 
employer begin to bargain with the union. Nat'l Labor Relations 
Bd. v. Lundy Packing Co., 68 F.3d 1577, 1583 (4th Cir. 1995).
    As if the Fourth Circuit's admonition were not enough, the 
NLRB treated the decision as a mere distraction and proceeded 
to count the challenged ballots to determine if certification 
of the union would be appropriate. This action forced the 
employer to return to the Fourth Circuit, and the court told 
the NLRB in no uncertain terms that ``the attempt by the Board 
to revive the representation petition and the election that 
followed exceeds the Board's jurisdiction.'' (Nat'l Labor 
Relations Bd. v. Lundy Packing Co., 81 F. 3d 25, 26) (4th Cir. 
1996). Nonetheless, the NLRB refused to take no for an answer 
and asked the Fourth Circuit to reconsider, whereupon the 
seemingly exasperated court stated:

          The NLRB acted in clear contravention of its 
        jurisdictional limits and sought to bypass this court. 
        . . . As we explained in our order of February 15, 
        1996, the NLRB has no such authority. The court 
        reiterates its respect for the NLRB's role in the area 
        of national labor relations law. The court expects in 
        turn respect for its processes and mandates. Nat'l 
        Labor Relations Bd. v. Lundy Packing Co., No. 95-
        1364(L) (4th Cir. March 21, 1996) (unpublished opinion) 
        (quoted in part in Perdue, 935 F. Supp. 713).

    Like both the Perdue and the Lundy Packing cases, Shepard 
Convention Servs., Inc. v. Nat'l Labor Relations Bd. (85 F. 3d 
671) (D.C. Cir. 1996) represents another instance where the 
NLRB disregarded long-standing NLRB policy and had to be reined 
in by a federal court. That case involved an organizing effort 
by the International Alliance of Theatrical Stage Employees 
where the union, citing the large number of eligible voters 
that will be on-call workers, requested that the election be 
conducted by mail. The NLRB Regional Director denied the 
request, and the union filed a ``special request'' for review 
by the NLRB. The NLRB, finding that the Regional Director had 
abused his discretion by denying the union's request, directed 
a mail ballot election for the on-call employees. After the 
Regional Director ordered all eligible employees to vote by 
mail, the employer requested review, as the NLRB's order had 
referred only to on-call employees. The employer's request for 
review was summarily denied.
    A mail ballot election was then conducted over a period of 
two weeks. Only 77 of the 438 eligible employees, or 
approximately 17.5 percent of the workforce, voted. Of the 68 
ballots that were not challenged, 40 were cast for the union 
that was then certified as the bargaining despite the 
objections to the election that were filed by Shepard. After 
Shepard refused to bargain with the union, the NLRB issued an 
order finding the employer's refusal an unfair labor practice.
    The District of Columbia Court of Appeals found that the 
Regional Director had ``properly denied the union's request for 
an election by mail'' and that the NLRB ``undertook to second-
guess the Regional Director in violation of its own 
regulations.'' 85 F. 3d at 674. The court went on to conclude:

          In sum, the NLRB's reversal of the Regional 
        Director's discretionary decision to conduct a manual 
        election cannot be upheld. Had the NLRB left the 
        decision intact, as its regulations required, voter 
        turnout might well have been higher. . . . It could 
        hardly have been lower. 85 F. 3d at 675.

    The Seventh Circuit Court of Appeals has also had strong 
words for the NLRB. In a case involving an NLRB decision to 
certify a union over the objections of the employer that 
supervisory employees were improperly included in the 
bargaining unit, the Seventh Circuit had this admonition for 
the NLRB:

          While we adhere to the generally accepted standard of 
        review discussed above, the fact of the matter is that 
        ``[a]n administrative agency, like any other first-line 
        tribunal, earns--or forfeits--deferential judicial 
        review by its performance.'' In the context of 
        classifying supervisors, the NLRB's manipulation of the 
        definition provided in section 152(11) has earned it 
        little deference. We remain mindful of the statutory 
        prescription of judicial restraint but note that such 
        restraint ``does not entail complete abdication of the 
        judicial role. Nat'l Labor Relations Bd. v. Winnebago 
        Television Corp., 75 F.3d 1208, 1214 (7th Cir. 1996).

    A November 8, 1996, decision by the Court of Appeals for 
the District of Columbia was similarly critical of the Board in 
the case of Skyline Distribs. v. Nat'l Labor Relations Bd., No. 
95-1571, slip opinion, (Nov. 8, 1996). In that case, the Board 
ordered the employer to bargain with the union, even though the 
union had been rejected by the employees involved, based on an 
alleged unfair labor practice concerning a pay raise. While 
recognizing that such a bargaining order may be appropriate in 
extreme situations, Judge Harry T. Edward rejected the remedy, 
noting that the Board had ``no basis'' to issue such an order 
and that ``Indeed, the Board's decision to issue a bargaining 
order in this case is so lacking in evidentiary support and 
reasoned decisionmaking that it seems whimsical.'' The court 
also noted that the Board's remedy could not be enforced 
``because the Board has given no credence whatsoever to 
employee ``free choice.'' These are strong criticisms indeed--
here made more alarming by the fact that the Board's remedy 
would have forced employees to be represented by a union they 
had rejected.
            Conclusion
    The opinions of both the federal courts and of labor law 
practitioners regarding the conduct of the NLRB are of concern 
to the Subcommittee. This is the case because the very nature 
of the NLRB's responsibilities requires that it maintain the 
respect and interest of both labor and management as it uses 
the applicable law to drive the parties toward peaceful and 
orderly resolution of labor disputes. The statutory make-up of 
the NLRB, where various arms of the agency are both judge and 
prosecutor of alleged violations of the law, demands a strong 
commitment to impartiality. But, unfortunately, it does not 
appear that such a commitment has been made by the current 
NLRB. Both the review of court decisions assessing the NLRB's 
actions and the oversight activities of the Subcommittee 
indicate that Chairman Gould and General Counsel Feinstein have 
apparently neglected the traditions of the NLRB to the 
detriment of the agency's stature in the eyes of the federal 
courts, the Congress and the public.

Mismanagement within the Department of Education, Office of 
        Postsecondary Education: Creation of A Student Loan Hierarchy

    Since the inception of the Federal Direct Student Loan 
Programs (FDSLP) and its unique chain of command, new problems 
have arisen within the Department of Education. These problems 
include infighting among high ranking employees that have 
negatively impacted the efficient and effective operation of 
the higher education lending programs. According to a June 1996 
report to the Subcommittee from the Department of Education's 
Office of the Inspector General (OIG) these personality 
differences ``exacerbated the poor communication, contributed 
to poor coordination between their respective staffs, a further 
deterioration of morale, and heightened human resource 
management concerns in the bifurcated structure.''
    One of the major functions of the Department of Education 
involves administering student financial aid programs for 
higher education. The Subcommittee is seriously concerned about 
reports that the divided management structure intended to 
implement the student financial aid programs has been one of 
the most significant failings of the Department of Education. 
Indeed, in August 1995 the Advisory Committee on Student 
Financial Assistance (Advisory Committee) wrote a scathing 
report about the divided management of the FDSLP and the 
Federal Family Education Loan Program (FFELP). In particular 
the Advisory Committee stated:

          [The] Department of Education has chosen a structure 
        that cannot adequately address its major management 
        challenges: the redesign of the Title IV delivery 
        system, implementation of the [FDSLP], and reform of 
        the FFELP. Furthermore, responsibility for both 
        implementing the [FDSLP] and overseeing FFELP reform is 
        concentrated in a special advisor to the Secretary (Leo 
        Kornfeld). However, this advisor has stated publicly 
        that FFELP reform is not a priority.

    The Subcommittee will continue examining the FDSLP to 
ensure that scarce federal dollars are used effectively and 
efficiently despite the inadequate management structure at the 
Department of Education.

The entitlement maze

    During the first session of the 104th Congress, the 
Subcommittee began examining entitlement programs, including 
the voluminous amount of paperwork an individual must complete 
prior to obtaining food stamps, job training, and/or child 
care. Specifically, on March 27, 1995, the Subcommittee held a 
hands-on hearing regarding federal and State assistance 
programs. The purpose of this hearing was to provide Members 
with an opportunity to ``step into the shoes'' of a family 
seeking assistance from federal and State programs.
    During this simulation, the Members participated in a role 
playing exercise where they became honorary members of the 
Hernandez family--a family living in the City Heights section 
of San Diego, California.
    Members had the opportunity to participate actively in the 
simulation and were asked to complete application forms 
required by federal and State assistance programs. In order for 
them to get a real appreciation for the human side of this 
process, the simulation mediator, Ms. Margret Dunkle of the 
Institute for Educational Leadership, brought along 13 
employees from the San Diego area, including many front-line 
individuals who were responsible for making eligibility 
determinations for many of the programs the Members dealt with 
during the simulation.
    At the conclusion of the hearing, the Members found the 
process to be confusing, burdensome, and generally 
unacceptable. Indeed, Members were not only concerned with the 
sheer volume and duplicative nature of the information 
requested by applicants from entitlement agencies, but were 
surprised that relevant information cannot be exchanged between 
agencies assessing eligibility of applicants requesting more 
than one entitlement.

The minimum wage hotline

    On November 8, 1995, it was brought to the attention of the 
Subcommittee that the Department of Labor created and activated 
a toll-free minimum wage hotline that was intended to identify 
minimum wage workers who were interested in an increase in the 
minimum wage. The Subcommittee's main concern was whether or 
not this hotline was a waste of valuable taxpayer funds and 
whether or not its existence was in accordance with all 
applicable law. Therefore, on November 14, 1995, the 
Subcommittee sent a letter to the Department of Labor regarding 
the implementation of this hotline.
    On December 5, 1995, the Department of Labor responded to 
the Subcommittee's inquiry. According to the Department of 
Labor, the intent of the hotline was to gather information for 
use before Congress. The Department of Labor indicated that:

          [The] Department of Labor believes this use of 
        technology is one example of a cost effective and 
        minimally burdensome means of making factual 
        information about the actual consequences of proposed 
        policy changes available to policymakers.

    When asked what steps were taken to publicize the hotline, 
the Department of Labor noted that the availability of the 
hotline was communicated through a press release, a number of 
speeches given by Secretary of Labor Robert Reich, and several 
radio interviews. Based on documentation obtained by the 
Subcommittee, the Department of Labor failed to mention that 
they personally contacted approximately 15 labor unions, 
including the AFL-CIO, advising them that the hotline was 
operational and requested that they share this information with 
their affiliates and other interested parties. Even more 
disturbing were the actions of one high-level Department of 
Labor official who prepared and distributed materials regarding 
the hotline that contravened applicable lobbying laws. Due to 
these and other inappropriate actions by this high-level 
official, Mr. Richard F. Sawyer--a Secretary's Representative--
was terminated.

The $32,000 copying bill

    In June of 1995, the Subcommittee learned that the 
Department of Labor was regularly incurring costs associated 
with the use of private reproduction and copying services 
throughout the Washington D.C. area. In response to 
Subcommittee inquiries, the Department of Labor identified 
about 20 instances where it had used the services of private 
copying enterprises. The costs incurred by the Department of 
Labor for these services ranged from a low of $21.00 to a high 
of $31,830.00. Most notably, on the eve of the President's 
State of the Union Address, the Department of Labor ordered 
additional copies of the President's ``Middle Class Bill of 
Rights.''
            The 1995 State of the Union Address
    During the early evening hours of January 24, 1995, high-
level Department of Labor staff determined that the 200 copies 
of the document that had been produced internally were 
insufficient and that many more copies were needed. Instead of 
contacting the Government Printing Office (GPO), as required, 
and complying with the Department of Labor's internal policies 
and procedures, the Office of the Secretary contracted with 
Kinko's, a private copying enterprise. Kinko's was tasked with 
producing 1,500 color, collated copies of the ``Middle Class 
Bill of Rights'' by 9:30 a.m. the very next day--the day of the 
President's State of the Union Address.
    The bill for the overnight reproduction of the ``Middle 
Class Bill of Rights'' was $31,830.00. On April 15, 1995, the 
Acting Director of Administration and Procurement Programs 
wrote to the Joint Committee on Printing seeking an after-the-
fact waiver of law. Specifically, the Department of Labor 
requested approval for payment of the $31,830.00 Kinko's bill 
for printing services acquired from a source other than the 
GPO.
    The Joint Committee on Printing denied the Department of 
Labor's request for a waiver because the Department of Labor:
          (1) Ignored a number of notices addressed to the 
        heads of all departments and agencies, including the 
        Department of Labor, concerning the limitations on 
        appropriated funds for the direct procurement of 
        printing and duplicating;
          (2) Failed to coordinate with its own Administration 
        and Management officials for the reproduction;
          (3) Engaged in spontaneous decision-making in going 
        to Kinko's as a sole source provider; and
          (4) Was a repeat offender, in that this was not the 
        first incident of ``illegal'' printing by the 
        Department of Labor.
            Repeat offenders: Political appointees
    In addition to denying the Department of Labor's request 
for a waiver, the Joint Committee on Printing requested that 
the Department of Labor's Office of the Inspector General 
conduct a review of the ``Department's acquisitions of 
printing. . . . '' The Office of the Inspector General 
determined that the Department maintained sufficient internal 
controls to prevent the improper expenditure of appropriated 
funds for printing. Indeed, the Department of Labor had 
implemented appropriate policies and procedures to safeguard 
taxpayer funds and to ensure the efficient and effective use of 
scarce federal resources. But the Department of Labor's Office 
of the Inspector General identified a different problem that 
cannot be corrected by mere policies and procedures--after all, 
policies and procedures must be followed to have any meaning. 
Specifically, the Office of the Inspector General stated the 
following:

        . . . we do recommend that the Department of Labor 
        place greater emphasis on this issue in the 
        instructions provided to political appointees, who were 
        responsible for most of the direct procurements cited 
        by the Joint Committee on Printing. In particular, we 
        recommend that the restrictions on direct procurement 
        of printing and the potential consequences of 
        violations be incorporated in the orientation briefings 
        for all new political appointees. This recommendation 
        has been discussed with officials of OASAM's 
        Directorate of Administrative and Procurement Programs 
        who concurred and are preparing information to include 
        in the briefing materials. We further recommend that 
        political appointees receive periodic reminders of the 
        printing related requirements through briefings at the 
        executive staff meetings and/or political appointees 
        meetings.
            Conclusion
    The facts surrounding the Department of Labor's $32,000 
Kinko's bill are troubling. In this matter, it is apparent that 
high-level Department of Labor appointees violated the letter 
and spirit of the law which they are obligated to honor. In 
sum, the staff members at the Department of Labor were all too 
willing to disregard internal policies and procedures intended 
to protect scarce taxpayer dollars for political expediency 
related to the President's State of the Union Address.

     c. consistently follow congressional intent and applicable law

    Another major function of the Subcommittee is ensuring that 
the letter and spirit of the law is adhered to by the federal 
entities within its jurisdiction. At times, circumstances arise 
that are clearly inconsistent with the statutory intent 
established by Congress. Fraudulent filings of information, 
abuse of process by a high level federal employees and illegal 
partisan activities are just some of the matters examined by 
the Subcommittee and discussed below.

Fraud in the Davis-Bacon Act

    For years, critics have argued that the Davis-Bacon Act 
(DBA), which governs wages and benefits on federal construction 
projects, mandates higher wages and benefits than those paid in 
private sector construction. A recent investigation by the 
Oklahoma Department of Labor uncovered fraud, waste, and abuse 
in the DBA. But, not only has the Oklahoma investigation 
uncovered fraudulent activities, it has also uncovered 
potential criminal activities as well. The Federal Bureau of 
Investigation (FBI) and the Oklahoma State Bureau of 
Investigations are currently investigating allegations of 
wrongdoing in Oklahoma involving Department of Labor employees 
and members of organized labor.
    In keeping with its oversight responsibilities, the 
Subcommittee has been investigating charges of wrongdoing in 
the implementation of the DBA. The Subcommittee held hearings 
in Oklahoma City, Oklahoma, on January 18, 1996, and in 
Washington, D.C., on June 20, 1996. In addition, the 
Subcommittee requested that the General Accounting Office (GAO) 
review the prevailing wage process to determine if it was 
susceptible to fraudulent activities. The Subcommittee also 
asked the Department of Labor's Office of the Inspector General 
to investigate the allegations of fraud in Oklahoma and to 
audit several other states to determine if fraudulent 
activities are a systemic, nationwide problem.
            Current law
    Passed in 1931, the DBA applies to contractors who work on 
federal construction projects. It requires contractors to pay 
certain ``prevailing wages'' to the various classes of laborers 
and mechanics working under federal contracts. The DBA covers 
direct federal construction, alteration, and repair, including 
painting and decorating of public buildings or public works, 
where the contract is valued at $2,000 or more.
    The DBA has remained essentially unchanged since its 
passage 65 years ago, with only minor amendments in 1935, 1940, 
1941, and 1964. However, a greater impact has come from the 
extension of Davis-Bacon requirements to a broad range of 
programs involving varying degrees of federal funding (ranging 
from low-income housing to Head Start programs). For example, 
the Department of Labor estimates that in fiscal year 1995, the 
DBA-covered construction accounted for approximately $40 
billion of the $295.4 billion total dollar volume of the U.S. 
construction industry or about 14 percent.
            Government reports highlighted problems for years
    The GAO has raised concerns about the accuracy of the 
Department of Labor's wage determinations for a number of 
years. The GAO issued a series of seven reports to Congress 
between June 1962 and August 1970. Those reports ``pointed out 
that the prevailing rates prescribed by the Department of Labor 
were significantly higher than wage rates prescribed in the 
areas and had substantially increased the costs of construction 
to the Federal Government.'' Moreover, in 1979, the GAO issued 
another report and recommended the repeal of the DBA.
    In 1994, the GAO issued a follow-up report which found that 
while some regulatory improvements had occurred, key concerns 
noted in the 1979 GAO report remain. The 1994 GAO report noted 
the potential for wage determinations to be based on low 
quality data, as well as the fact that the Department of Labor 
does not verify the data received, even on a sample basis. 
These GAO reports underscore the inherent difficulties in 
accurately administering a complex, government wage-setting 
process. (The Davis-Bacon Act, GAO/HEHS-94-95R, February 7, 
1994).

                 overview of the oklahoma investigation

    In January 1995, a number of Oklahoma citizens and public 
officials contacted the Oklahoma Department of Labor regarding 
newly published Davis-Bacon wage rates. A comparison of the old 
and new wage rates showed increases of as much as 162 percent. 
These increases are passed along to taxpayers in the form of 
higher costs on public construction projects like schools and 
highways. Because of the overwhelming increase and concern that 
Oklahoma's workers and taxpayers had been the victim of fraud 
and abuse, the Oklahoma Department of Labor began an inquiry 
into the Davis-Bacon prevailing wage survey process. The 
Oklahoma Department of Labor produced an investigative report 
entitled ``The Davis-Bacon Act, and Fraudulent Wage Data'' 
which was submitted to the Department of Labor and to Congress 
in July 1995. The initial report by the Oklahoma Department of 
Labor identified three cases of apparent fraudulent activities.
    The Oklahoma Investigative Report concluded by noting that 
the ``response of the U.S. Department of Labor to date has been 
disappointing. Repeated requests for information solely in the 
possession of the Department have been delayed or denied.''

1. Response of the committee

    After learning of the Oklahoma Department of Labor 
investigation, Members of the Committee met with Oklahoma 
officials to learn more about their investigation. As a result 
of this meeting, Chairman Goodling, and Subcommittee Chairmen 
Ballenger and Hoekstra sent a letter to Department of Labor 
Secretary Reich. The letter said in pertinent part:

          Specifically, it has been reported to us that certain 
        wage rates, applicable to federally funded heavy 
        construction projects in some Oklahoma counties and 
        applicable state-funded projects pursuant to Oklahoma's 
        Little Davis-Bacon Act, are invalid. It is further 
        alleged that inaccurate information was 
        ``intentionally'' submitted to the Department of Labor 
        resulting in improper and excessive tax burdens for 
        public construction in Oklahoma.

    As part of its preliminary investigation, the Subcommittee 
continued an exchange of letters with the Department of Labor 
in an effort to obtain more details about the allegations of 
fraud and abuse in the DBA. Subcommittee Members also met with 
Wage and Hour Administrator Maria Echaveste to gain further 
insight into the Davis-Bacon prevailing wage process and the 
Department of Labor procedures. Because of the serious nature 
of the allegations of fraud, Chairs Bill Goodling, Nancy 
Kassebaum, Orrin Hatch, Henry Hyde and other interested House 
and Senate Members wrote to Attorney General Janet Reno, 
requesting that the Department of Justice ``place a high 
priority on its on-going investigation into the Davis-Bacon Act 
and related allegations of fraud in the State of Oklahoma.''
    Because of concern for taxpayer funds, Subcommittee 
Chairmen Pete Hoekstra and Cass Ballenger wrote to all 50 
Governors and State Commissioners of Labor to inform them of 
the ``. . . concerns that have come to our attention regarding 
prevailing wage determinations under the Davis-Bacon Act.''

2. Subcommittee hearing on allegations of fraud in the Davis-Bacon Act

    On January 18, 1996, the Subcommittees on Oversight and 
Investigations and Workforce Protections conducted a joint 
hearing in Oklahoma City, Oklahoma, to review the allegations 
of fraud and abuse in the DBA. Several witnesses testified at 
the hearing, including Oklahoma Department of Labor officials 
and contractors. At the hearings, Oklahoma Labor Commissioner 
Brenda Reneau testified regarding the State investigation of 
fraud in the DBA. Her testimony revealed that:
          (1) Grossly inaccurate information had been reported 
        to the federal government by what the Department of 
        Labor calls ``interested third parties'';
          (2) Wage survey forms included inflated numbers of 
        employees on projects, inflated wage rates reported for 
        these same non-existent workers, and projects that were 
        never built;
          (3) The initial investigation identified only three 
        cases of what appears to be fraudulent activities, and 
        new evidence indicates nearly 100 additional cases of a 
        similar nature;
          (4) The Oklahoma Department of Labor repeatedly 
        informed officials at the Department of Labor that they 
        had been given false information during the survey 
        process. Initially, Labor officials indicated that 
        although they knew that inaccurate information was 
        submitted during surveys, they made no effort to verify 
        the information received; and
          (5) A follow-up investigation conducted by the 
        Department of Labor confirms that not only was a great 
        deal of inaccurate information reported, but also the 
        Department of Labor's own documents show certain unions 
        in Oklahoma City as the parties who submitted the 
        information.
    One witness who works for an Oklahoma contracting company 
testified that the company did not submit any WD-10 forms to 
Department of Labor for a variety of reasons. However, this 
company's name appeared on 24 WD-10 forms in the 1993 Building 
Construction Survey. Out of the 24 forms, the company did work 
on only one of the listed projects. The witness testified that 
the company had been contacted by the Oklahoma Operating 
Engineers Union. The witness also testified that the union 
offered to ``fill out'' the WD-10's for the construction 
company, if someone from the company would just sign the forms.

  the most recent reports from the general accounting office and the 
                      oklahoma department of labor

1. The 1996 GAO report

    On May 31, 1996, the GAO released a report that raised 
several questions about the Act and noted that inherent process 
weaknesses could contribute to a lack of confidence in the 
prevailing wage rates used by the Department of Labor. The 
report notes:

          Labor's wage determination procedures contain 
        weaknesses that could permit the use of fraudulent or 
        inaccurate data for setting prevailing wage rates. 
        These weaknesses include limitations in the degree to 
        which Labor verifies the accuracy of the survey wage 
        and fringe benefit data it receives, limited computer 
        capabilities and safeguards to review wage data before 
        calculating prevailing wage rates, and an appeals 
        process that may not be well publicized. Labor's 
        failure to prevent the use of fraudulent or inaccurate 
        data may result in wages and fringe benefits being paid 
        to construction workers that are lower than those 
        prevailing. Erroneous prevailing wage rates could also 
        lead to excessive government construction costs and 
        undermine confidence in the system among survey 
        respondents, reducing their future participation.

    This report buttressed the conclusions of the Oklahoma 
Department of Labor that the Act's prevailing wage process is a 
candidate for fraudulent activity. The events and circumstances 
in Oklahoma reinforce the warnings issued by a series of GAO 
reports for over 30 years. The GAO reports highlight the 
inherent difficulties in administering a complex, government-
mandated wage-setting system.

2. The 1996 Oklahoma report

    On May 24, 1996, the Oklahoma Department of Labor released 
a new report regarding specific concerns about the Department 
of Labor's role in the allegations of fraud in the DBA. The 
Oklahoma Department of Labor report alleges that the Department 
of Labor:
          (1) Failed to be forthcoming with information related 
        to the fraud investigation;
          (2) Knew the breadth and depth of Davis-Bacon 
        problems, while denying these problems existed;
          (3) Stonewalled the Oklahoma investigation; and
          (4) Provided information to the Speaker of the House 
        and to other Members of Congress that was inconsistent 
        with other public documents.
    The report, based on an extensive review of public 
documents, reveals ``that officials within the Department of 
Labor may have played an active role in wrongfully inflating 
federal prevailing wage rates at the expense of taxpayers and 
for the benefit of favored officials within organized labor.''
            Additional reviews
    As a result of these two new reports, the Subcommittees on 
Oversight and Investigations and Workforce Protections 
conducted a second hearing on June 20, 1996, so that Members 
could learn first hand of the problems with the prevailing wage 
process, as well as allegations of potential wrongdoing by the 
lead government agency in charge of setting wages and benefits 
for federal construction projects. Testifying at the hearing 
were Ms. Carlotta C. Joyner, Director of Education and 
Employment Issues for the GAO, Oklahoma Commissioner of Labor 
Brenda Reneau and Deputy Commissioner of Labor Jeff Lester.
    The Department of Labor agreed that there were ``data 
weaknesses'' in the prevailing wage surveys used in Oklahoma 
and issued a redetermination of the prevailing wage rates in 
April 1996.
    Currently, the Department of Labor's Office of the 
Inspector General is conducting a review of several states to 
determine if prevailing wage programs have been subject to 
potentially fraudulent and possibly criminal activity.
            Conclusion
    Based on the two separate investigative reports submitted 
to the Committee by the Oklahoma Department of Labor and the 
May 1996 GAO report, it is obvious that the Davis-Bacon 
prevailing wage process in Oklahoma is fatally flawed. Years of 
research have demonstrated that there is substantial cost 
associated with the Davis-Bacon Act. It essentially requires 
contractors to pay higher than market wages and benefits on 
federal construction projects at the expense of the American 
taxpayers. Editorial writers throughout the country have 
repeatedly characterized the law as special interest 
legislation designed to protect one group of beneficiaries at 
the expense of other construction workers, contractors, and 
taxpayers.
    Coupled with these findings are the two reviews conducted 
by the Oklahoma Department of Labor. The first review focused 
on the specific cases of fraud and exposed the fact that in one 
instance a wage survey was based on an underground storage tank 
that was never constructed. The second review conducted by the 
Oklahoma Department of Labor was even more revealing than the 
first--charging the Department of Labor with failure to be 
forthcoming with information, deceit, stonewalling, and 
providing information to the Congress that was inconsistent 
with other public documents.

Politicization of the Government shutdown

    After receiving some very serious complaints concerning the 
shutdown of programs under the Committee's jurisdiction during 
the lapse in appropriations that occurred in late 1995 and 
early 1996, the Subcommittee began a thorough examination of 
the shutdown at the Departments of Education and Labor. The 
findings raised serious concerns that the recent government 
shutdown violated applicable law and, in many ways, had the 
appearance of political calculation by the Clinton 
Administration.
    This shutdown, coupled with the public statements of the 
Secretary of Labor, Robert Reich, had the effect of raising 
fear in American workers concerning their safety in the 
workplace. Additionally, financial strains were placed on State 
and local educational agencies unnecessarily and possibly 
illegally through the actions of the Secretary of Education, 
Richard Riley.
    A brief summary of the applicable law concerning government 
shutdowns due to the lack of an appropriation will serve as a 
backdrop to the inappropriate actions of these two Secretaries.
            Brief background on the applicable law
    The Antideficiency Act prohibits government officials from 
incurring obligations or authorizing expenditures and contracts 
in excess or advance of appropriations unless authorized by 
law. Certain activities are ``excepted'' from suspension and 
are therefore authorized to continue during gaps in 
appropriated funding. These include:
          1. Providing for national security;
          2. Providing benefit payments and performing 
        obligations under appropriations or funding not subject 
        to the delayed appropriation; and
          3. Conducting activities that protect human life and 
        property.
    The scope and applicability of this law is well briefed in 
memoranda and past opinions of the Attorney General's office--
commonly known as the Civiletti and Dellinger Memoranda.
            Shutdown of the Department of Labor
    Secretary of Labor Reich furloughed nearly all of the 
Occupational Safety and Health Administration's (OSHA) job 
safety inspectors during the recent government shutdown. By 
this decision, Secretary Reich in essence determined that there 
was ``no reasonable likelihood that the safety of human life or 
the protection of property would be compromised, in some 
significant degree. . . .'' 31 U.S.C. Sec. 1342 as amended, 
interpreted in Memorandum for Alice Rivlin from Walter 
Dellinger, August 16, 1995. However, rather than reassure the 
public that these employees are not necessary ``in some 
significant degree'' to the ``safety of human life,'' Secretary 
Reich was quoted as saying,

        [in] a peculiar twist befitting the interests of this 
        Congress, we will be prohibited from carrying on our 
        normal duties to prevent tragedies in the workplace . . 
        . [w]e will only be able to respond after these 
        tragedies have occurred.

This quote directly contradicts Secretary Reich's decision not 
to have these employees excepted under the Antideficiency Act 
and only served to create fear and confusion among American 
workers. At the same time, it wrongly implied that furlough 
decisions are in the hands of Congress.
    Simply put, Secretary Reich furloughed these employees 
knowing that there was an imminent risk to human life, in which 
case he was jeopardizing the safety of American workers, or he 
determined that these furloughed OSHA inspectors were not 
essential to the protection of human life, in which case he was 
being less than candid with the media by raising concerns about 
impending ``tragedies in the workplace.''
    On November 29, 1996, a letter was sent to Secretary of 
Labor Reich, by Chairmen Goodling, Hoekstra and Ballenger, 
asking the Secretary to explain and provide documentation on 
the contradiction between Secretary Reich's furlough decisions 
and his public statements. Subsequently, the Committee received 
a response from the Department of Labor that failed to provide 
any of the requested documentation and which made no attempt to 
reconcile Secretary Reich's public statements with his furlough 
decisions. Instead, the Department of Labor ``reinterpreted'' 
the word ``imminent'' by relying on the imminent danger clause 
of the Occupational Safety and Health Act.
    In short, Secretary Reich's response did little to 
alleviate the Committee's concern that the furlough decisions 
at the Department of Labor were political and were targeted at 
groups that had vocal and active constituencies. Secretary 
Reich's public statements and furlough decisions can only be 
explained in political terms. In the future, Secretary Reich or 
whomever is serving as Secretary must either deem OSHA 
employees as excepted or he/she should publicly reassure 
workers that there is no imminent risk to human life by having 
these employees furloughed.
            Shutdown of the Department of Education
    Nearly every program at the Department of Education was 
suspended during the government shutdown and most employees 
were furloughed. However, because most of the Department of 
Education's programs are forward or alternatively funded 
(meaning that current payments to grantees (schools, students, 
etc.) are made from funds appropriated in the prior fiscal year 
and that personnel related to those programs could not be 
employed pursuant to the Civiletti and Dellinger Memoranda), it 
appears that the Department of Education irresponsibly and 
possibly illegally chose to withhold funds that had already 
been appropriated by Congress signed into law by the President, 
and obligated to the States and localities (mostly in fiscal 
year 1995). These funding delays were unnecessary, since the 
government shutdown should only have applied to operations 
lacking current funding, which, in this case, are those 
programs awaiting a fiscal year 1996 appropriation. In more 
technical terms, these delays had the appearance of the 
impoundment of government funds by the Executive Branch.
    In essence, the Department of Education held hostage 1995 
education money to force compromise on the 1996 appropriation, 
to increase the impact of the shutdown on as many individuals 
and institutions as possible, and to further the Clinton 
Administration's overall agenda. Furthermore, because of the 
Cash Management Improvement Act, which requires penalties for 
late payments on prior obligations, the Department of Education 
may have recklessly wasted education money on fines and 
penalties instead of the education of children.
    The Committee raised these concerns with Secretary of 
Education Riley in a letter signed by Chairman Bill Goodling 
and Subcommittee Chairman Pete Hoekstra dated November 28, 
1995. This letter also requested background documentation 
concerning the Secretary's furlough decisions. The Secretary of 
Education responded promptly and included several documents 
that had been requested. Unfortunately, the Secretary's 
response completely misstated the interpretation of the 
Antideficiency Act's handling of alternatively funded programs, 
specifically, the provision that such programs can continue 
operating despite the lack of a current appropriation to fund 
the administration of such programs.
    Of even greater concern is that the Department of Education 
included in its initial response a letter from its own General 
Counsel, Judith Winston, to the Attorney General asking him to 
confirm the General Counsel's opinion that forward funded 
programs at the Department of Education should not be suspended 
by the lack of a current appropriation. Since no response from 
the Attorney General was included and since no other 
documentation concerning this opinion was provided, the 
Committee must conclude that the Department of Education not 
only went against every recent interpretation of the 
Antideficiency Act, but also went against or ignored the 
opinion of its own legal counsel--an unprecedented action, one 
which raised further concerns about the Clinton 
Administration's handling of the government shutdown.
    The Committee sent a follow-up letter to the Department of 
Education on December 18, 1995, which again restated the law, 
and pointed out the opinion of the Department of Education's 
own General Counsel, which was in total agreement with the 
position of the Committee. The letter concluded by demanding 
that the Department of Education begin obligating funds as 
required by law.
    Three days later, on December 21, 1995, the Department of 
Education sent a letter to the Committee stating in relevant 
part that:

          The Department is taking steps to authorize the 
        necessary staff to return to work to perform this 
        activity [operate alternatively funded programs] . . . 
        this authorization applies to payments for programs 
        with budget authority currently available from prior 
        year appropriations.

While this letter confirmed the validity of the Committee's 
position, and allowed many Department of Education employees 
who were wrongfully furloughed to return to work, it only 
heightened the Committee's concern that the Administration was 
not handling the government shutdown in accordance with 
applicable law.
    In conclusion, the Committee remains concerned that the 
intent of the Antideficiency Act was not followed by either the 
Department of Labor or the Department of Education. 
Furthermore, these actions put the education of American 
students and the safety of American workers in jeopardy. In 
short, politics was apparently placed above sound public policy 
by the Clinton Administration.

Abuse of power at the Department of Labor

    Over the course of the last two years, allegations have 
been made that political appointees within the Clinton 
Administration have used their positions to influence matters 
involving interested third parties. While some of these 
allegations simply involve parties unhappy with the 
Administration's legitimate disposition of a relevant matter, 
the case leading up to the dismissal of Mr. Richard F. Sawyer 
is a remarkable study in the damage that can be done when 
inappropriate selections are made for high-level positions at 
an executive agency.
    Mr. Sawyer, a Secretary's Representative at the United 
States Department of Labor, abused the power of his office by 
attempting to exert undue influence in an ongoing labor dispute 
between Somers Building Maintenance, Inc. (Somers), a 
janitorial services company located in northern California, and 
the Service Employees International Union (SEIU). These facts 
are demonstrated in a detailed investigative report prepared by 
the Department of Labor's Office of the Inspector General.

                               Background

1. Somers Building Maintenance, Inc. and the SEIU

    Somers is a janitorial services contractor headquartered in 
Sacramento, California, with offices throughout northern 
California and Oregon. Somers is the largest non-union 
janitorial contractor in Sacramento and currently employs over 
600 people.
    The SEIU is the fourth largest and fastest growing union in 
America with more than one million members working in health 
care, government, and private industry. The SEIU was engaged in 
efforts to organize janitorial workers at Somers. This 
campaign, which was initiated against Somers by SEIU Local 1877 
in mid-1994, is still a part of the SEIU's national organizing 
campaign known as ``Justice for Janitors.''

2. Department of Labor's wage and hour investigation of Somers

    Coincident with the SEIU campaign to organize the 
janitorial workers of Somers in late 1994, as part of a 
national initiative designed to target past violators of the 
Fair Labor Standards Act (FLSA), the Department of Labor's Wage 
and Hour Division began a proactive investigation of possible 
FLSA violations at Somers. In the midst of this investigation, 
Mr. Richard Sawyer became involved.

3. Mr. Richard F. Sawyer

    On January 9, 1994, Mr. Richard F. Sawyer was appointed to 
the position of Secretary's Representative with the Department 
of Labor's Office of Congressional and Intergovernmental 
Affairs. Prior to his appointment, Mr. Sawyer was employed as a 
Business Manager, Central Labor Council of Santa Clara and San 
Benito Counties, AFL-CIO, from March 1986 until January 1994. 
From March 1973 to March 1986, Mr. Sawyer was an SEIU 
representative in Everett, Washington.
    The position of Secretary's Representative is located in 
the Office of Congressional and Intergovernmental Affairs, 
Office of Intergovernmental Affairs, Regional Intergovernmental 
Affairs Office, with the duty station in one of the 10 
Department of Labor regions. As defined by the Department of 
Labor, the duties and responsibilities of the Secretary's 
Representative include:

        undertakes a variety of special non-recurring 
        confidential and politically sensitive assignments 
        based upon an understanding of the Administration goals 
        and the Secretary's policies, as well as utilization of 
        own personal and extended experience in labor-related 
        affairs.

                       allegations of misconduct

    Allegations concerning Mr. Sawyer were made on June 27, 
1995, by Mr. Randall Schaber, a member of the Board of 
Directors for Somers. At that time, Mr. Schaber provided 
evidence of a formal complaint that he, on behalf of Somers, 
had filed with the Department of Labor's Office of the 
Inspector General alleging misconduct and ethical violations of 
Executive Order No. 12674, on the part of Mr. Sawyer.
    In his complaint, Mr. Schaber alleged that Mr. Sawyer had 
``conducted himself in a manner that was intended to induce and 
coerce Somers to enter into a recognition agreement and/or a 
collective bargaining agreement with SEIU Local 1877 under the 
penalty of having the Department of Labor continue its 
investigation of alleged wage and hour violations and impose a 
fine of an extraordinary amount for said violations and seize 
goods produced by clients of Somers under the hot goods 
provisions of the Fair Labor Standards Act.'' In support of his 
formal complaint, Mr. Schaber provided a detailed chronology of 
events including information regarding a telephone conversation 
between Mr. Sawyer, and Somer's largest client, Hewlett-
Packard.
    On June 27, 1995, Mr. Schaber filed another formal 
complaint, which he directed to the Department of Labor's 
Office of the Inspector General through Mr. Michael A. Hackard, 
an attorney representing Somers. In his complaint, Mr. Hackard 
requested that the Office of the Inspector General conduct an 
investigation of the Sawyer matter, citing ``serious breaches 
of governmental ethics and probable violations of federal 
criminal law including, but not limited to, violations of the 
Racketeering Influenced and Corrupt Organizations (RICO) Act 
[and] violations of the Hobbs Act, Mail Fraud, Conspiracy and 
Bribery.''
    Subsequently, on July 10, 1995, 18 Members of Congress 
signed a letter requesting an investigation into allegations of 
``an apparent conspiracy to coerce non-union building 
maintenance contractors into signing union contracts against 
the will of their employees.''

                 Actions by the Oversight Subcommittee

    In December 1995, the Subcommittee initiated a preliminary 
investigation into the allegations concerning Mr. Sawyer and 
Somers. After conducting several interviews and concluding that 
such allegations merited further examination, the Subcommittee 
sent a formal letter of inquiry to Secretary of Labor Robert B. 
Reich on December 14, 1995. In this letter, the Subcommittee 
reiterated the allegations contained in Mr. Schaber's complaint 
and conveyed the gravity with which the Subcommittee held the 
allegations:

          This Subcommittee and others are extraordinarily 
        troubled by the seriousness of these allegations. They 
        suggest strongly that a high-level Department of Labor 
        official was attempting to use his political influence 
        to coerce Somers into signing a union contract by 
        putting pressure upon Hewlett-Packard. These 
        allegations also raise concerns regarding serious 
        breaches of ethics, abuse of power, collusion, and the 
        misuse of federal funds by a Department of Labor 
        employee.

    The letter requested that the Department of Labor conduct a 
``prompt and thorough review of the allegations'' and provide 
Members with the findings of such review and any planned 
actions by January 12, 1996.
    On December 21, 1995, Solicitor of Labor Thomas S. 
Williamson responded to the letter on behalf of Secretary of 
Labor Reich. In that letter, Solicitor Williamson indicated 
that his office had consulted with the Office of the Inspector 
General and confirmed that there was, in fact, an active and 
ongoing investigation. In addition, Mr. Williamson indicated 
that while his office believed it had identified the Department 
of Labor official involved, it did not ``wish to risk any 
possibility of inadvertent interference with the [Office of the 
Inspector General's] investigation--'' and, therefore, would . 
. . withhold any final action pending the conclusion of the 
Office of the Inspector General's investigation. In the 
interim, however, Mr. Williamson indicated that the Department 
of Labor had decided to place the official involved under 
administrative leave (with pay), pending completion of the 
Office of the Inspector General's investigation. During this 
time, the official would be relieved of all official duties and 
have no authority to act on behalf of the Department of Labor.

    Final Report of the Inspector General, U.S. Department of Labor

    On February 28, 1996, the Department of Labor's Office of 
the Inspector General completed its 500-hour investigation into 
the matter involving Somers and Mr. Sawyer. After reviewing the 
Office of the Inspector General's final report, the 
Subcommittee sent a letter on March 1, 1996, to Secretary of 
Labor Reich. In this letter, the Subcommittee conveyed its 
concerns over the findings of the Office of the Inspector 
General stating:
    We are greatly concerned by the [Office of the Inspector 
General's] Report. Based upon that Report it appears that Mr. 
Sawyer:
          (1) Misused his position and aided the Service 
        Employees International Union (SEIU) in its attempt to 
        organize janitorial services of Somers;
          (2) Contacted Hewlett-Packard, which is one of Somers 
        largest clients, and disclosed investigative 
        information which was damaging to Somers; and
          (3) Influenced the Department of Labor's Wage and 
        Hour Division in an attempt to intimidate Somers into 
        recognizing the SEIU.
    The Subcommittee also conveyed its concerns over 
information included in the Office of the Inspector General's 
report suggesting that several other Department of Labor 
officials, including high-ranking officials within the 
Department of Labor's Wage and Hour Division, had not only been 
aware of Mr. Sawyer's actions, but also may have supported or 
encouraged these actions.
    In March 1996, the Subcommittee was advised that Mr. Sawyer 
was no longer employed by the Department of Labor. On that same 
day, the Subcommittee responded by sending a letter to 
Secretary Reich requesting information relating to the 
Department of Labor's response to the Office of the Inspector 
General's investigation and documentation pertaining to Mr. 
Sawyer's termination. The Department of Labor's response was 
provided to the Subcommittee in a letter dated April 1, 1996, 
from the Acting Solicitor of Labor, J. Davitt McAteer.
    On April 25, 1996, the Subcommittee held a hearing on 
Somers and the alleged misconduct by Mr. Sawyer. Testifying at 
the hearing were Mr. Schaber and Mr. Charles C. Masten, 
Inspector General at the Department of Labor.

                               Conclusion

    Based on the Office of the Inspector General's 
investigation and the testimony of other witnesses at the 
hearing, it is obvious that Mr. Richard F. Sawyer abused his 
position as the Secretary's Representative by intervening on 
behalf of the SEIU in its campaign to organize the janitorial 
workers of Somers. This information establishes several 
irrefutable facts:
          (1) Mr. Sawyer contacted officials of Hewlett-
        Packard, Somers' largest client, and specifically 
        discussed the Department of Labor's active and on-going 
        investigation of Somers.
          (2) Mr. Sawyer contacted the Department of Labor's 
        Wage and Hour investigators to request information on 
        the status of the Somers' investigation and to complain 
        about the progress of said investigation.
          (3) Mr. Sawyer improperly provided the SEIU with 
        specific information regarding the Department of 
        Labor's active and on-going investigation of Somers--
        information that was used by the SEIU both privately 
        and publicly to pressure Somers to capitulate to the 
        union's organizational demands.
          (4) Mr. Sawyer contacted high-ranking officials 
        within the Wage and Hour Division's national office to 
        complain about the progress of the Somers' 
        investigation.
          (5) In response to Mr. Sawyer's repeated contacts, 
        high-ranking officials within the Wage and Hour 
        Division's national office assigned five additional 
        investigators to the Somers' investigation and directed 
        investigators to give Somers special attention.
          (6) The Somers' investigation was kept open well 
        beyond the point the lead Wage and Hour investigator 
        deemed warranted by the facts.
          (7) Despite the involvement of no less than six 
        investigators and 500 hours of investigative work, the 
        Wage and Hour Division discovered only $317.44 in FLSA 
        violations.
    These facts clearly illustrate that Mr. Sawyer was engaged 
in a conscious effort to use his position as the regional 
representative of Labor Secretary Robert Reich to assist his 
former employer, the SEIU, in its efforts to organize the 
janitorial workers of Somers. As such, the Subcommittee 
believes it wholly appropriate that Mr. Sawyer's employment 
with the Department of Labor was terminated.
    The Subcommittee also remains concerned about the extent to 
which other Department of Labor employees had knowledge of, 
supported or assisted Mr. Sawyer in his efforts to coerce 
Somers into signing a union contract with the SEIU. As noted 
previously, Mr. Sawyer's position as a Secretary's 
Representative falls under the purview of the Office of 
Congressional and Intergovernmental Affairs and his official 
Department of Labor job description clearly states that the 
``Incumbent reports directly to the Director of the Office of 
Intergovernmental Affairs * * * [and] consults with the 
Director on decisions or matters which appropriately require 
personal attention.'' Based on this description of Mr. Sawyer's 
supervisory controls, it is reasonable to expect that high-
level Departmental officers, like the Director of the Office of 
Intergovernmental Affairs would have been aware of Mr. Sawyer's 
actions concerning Somers. It is also reasonable to assume that 
Ms. Geri Palast, Assistant Secretary of Congressional and 
Intergovernmental Affairs, would also have knowledge of Mr. 
Sawyer's actions. If not, the Subcommittee cannot help but 
question the efficacy of the Department of Labor's supervisory 
controls with respect to the Secretary's Representatives.
    The Subcommittee has similar concerns regarding the extent 
to which officials within the Department of Labor's Wage and 
Hour Division had knowledge of, supported or assisted Mr. 
Sawyer in his efforts to coerce Somers into signing a 
collective bargaining agreement with SEIU. In particular are 
concerns regarding the extent to which Ms. Maria Echaveste, 
Administrator of the Wage and Hour Division, was aware of, 
encouraged, or facilitated Mr. Sawyer's actions.
    As previously noted, senior Wage and Hour Division 
officials responded to Mr. Sawyer's meddling by assigning an 
additional five investigators to the Somers case. In total, 
Wage and Hour personnel devoted no less than 500 hours to the 
investigation. In doing so, the Department of Labor far 
exceeded the number of investigative hours devoted to any of 
the other top ten Wage and Hour investigations that were closed 
during fiscal year 1995--the largest involved only 386 
investigative hours. Certainly, any case that would merit this 
level of Wage and Hour activity must have had the attention and 
scrutiny of the Division's most senior official, Ms. Echaveste.
    At best, these facts call into question whether or not Ms. 
Echaveste is administering the Department of Labor's Wage and 
Hour Division in the most effective and efficient manner 
possible under the watchful eye of the Secretary of Labor. At 
worst, these facts belie Ms. Echaveste's contentions that she 
neither encouraged nor supported Mr. Sawyer's coercion of 
Somers. The fact that Ms. Echaveste approved, directly or 
otherwise, both the expansion and extension of the Somers case 
beyond the point at which the lead investigator deemed the 
facts warranted suggests that she did, in fact, collude with 
Mr. Sawyer and representatives of the SEIU.

Partisan political activities and the Central Oversight Group

    The Subcommittee became aware that the Department of Labor 
created a Central Oversight Group (COG) to coordinate responses 
to anticipated congressional oversight and to review programs 
under the Department of Labor's jurisdiction. The COG was 
created, according to the Department of Labor, only to ``gather 
routine information in a short time frame to prepare the 
Secretary for congressional hearings and to respond to 
congressional inquiries.'' However, the activities of the COG, 
went well beyond what was reported repeatedly by the Department 
of Labor to Congress. Instead, the COG was the genesis for the 
preparation and distribution of highly political documents in 
apparent violation of applicable law.
            Who participated in the COG
    The COG was comprised of more than 60 career and political 
appointees representing each of the major programs and offices 
at the Department of Labor. Many of the Assistant Secretaries 
were assigned to the COG and Agency Defensive Coordinators 
would meet weekly to monitor the COG's progress, identify and 
solve problems, provide direction where necessary and discuss 
cross-cutting issues.
            Political charts and documents
    On March 28, 1995, the Subcommittee requested copies of all 
the materials that were prepared under the umbrella of the COG. 
A careful analysis of the documents provided demonstrated that 
a number of the documents prepared by the COG did not fall 
under the guise of ``normal and proper governmental activity.'' 
Indeed, the Subcommittee became concerned that certain 
documents prepared by the COG were in violation of numerous 
laws.
    In an effort to ensure that a thorough and objective legal 
review was conducted of some of the materials in question that 
were prepared by the COG, the Subcommittee requested the CRS to 
conduct a legal review of the following four COG documents:
          (1) Battleground 94-Democratic Strategic Analysis;
          (2) Females Voting for Democrats, by Education;
          (3) Males Voting for Democrats, by Education; and
          (4) Who Gains from the Republican Contract?
In response to this request, CRS, in its October 27, 1995 
memorandum entitled ``Use of Federal Agency Appropriations for 
Preparation of `Political' Documents'', noted:

          The preparation of material by federal officers or 
        employees on official time, or otherwise paid for, 
        procured or printed with federal funds, when such 
        material is partisan political in nature and intended 
        to assist a particular political party or candidate, 
        may implicate a potential violation of several federal 
        statutes, regulations and ethical guidelines.

CRS went on to say with regard to the particular documents 
prepared by the COG:

          If the material in question were prepared by 
        department officials or employees on official duty 
        time, on government premises, with government resources 
        and equipment, or otherwise paid for, printed or 
        reproduced with government funds, . . . The material in 
        question, on its face, appears to be classical partisan 
        political, campaign research and analysis. The material 
        analyzes voting patterns for Democratic candidates and 
        discusses issues which the ``Democrats will have to 
        address . . . [to] reassure voters.''

Based on the CRS opinion, the Department of Labor, by 
preparing, reproducing, and distributing the COG documents in 
question, engaged in partisan political activities--a direct 
violation of federal law.
            The clandestine role of the Secretary of Labor
    It is important to note that the violations of law 
attributed to the production, reproduction, and distribution of 
the COG documents in question extends not only to those 
involved with the COG regularly, but to the Secretary of Labor 
himself.
    In evaluating the activities of the COG, Congress requested 
all relevant documents, including an explanation of how the 
four documents in question were used. Never did the Department 
of Labor reveal that the Secretary himself used some of the 
documents that CRS found to be in violation of applicable law. 
Through independent sources, the Subcommittee obtained a copy 
of a hand-written note by Secretary Reich to Mr. Jack Donahue, 
the former Assistant Secretary for Policy and Counselor to the 
Secretary at the Department, which demonstrates that the 
Secretary was, at a minimum, well aware of the documents being 
prepared by the COG and, in fact, instructed Mr. Donahue to 
make copies of these illegally prepared documents for his 
public use.

Teenage drug use on the rise: Four years of failure

    On September 26, 1996, the Subcommittee on early Childhood, 
Youth and Families and the Subcommittee on National Security, 
International Affairs and Criminal Justice of the Committee on 
Government Reform and Oversight (Subcommittees) held a joint 
hearing on the Epidemic of Teenage Drug Use. The Subcommittees 
learned that during the last four years there has been a 
horrifying increase in teen-drug use.
    During this hearing, the Subcommittees learned about 
private initiatives utilized by various Members of Congress who 
either established or supported existing community anti-drug 
coalitions. The first witness of the hearing, Representative 
Portman, cited the success of Miami's comprehensive community 
anti-drug coalition that cut usage in Miami to half that of the 
national average. What the successful programs do, he 
continued, is mobilize ``parents, businesses, religious 
leaders, students, law enforcement, the media and others to 
fashion a comprehensive long-term strategy to prevent and treat 
substance abuse one person at a time.''
    Furthermore, the Subcommittees learned that, despite 
tremendous improvements in slowing the rate of teen-drug use 
during the 1980's, new reports by the Department of Health and 
Human Services' Substance Abuse and Mental Health Services 
Administration have shed new light on the dramatic failures of 
the last four years in continuing the progress made during the 
Reagan and Bush Administrations in ridding our schools of 
illegal drugs. The Subcommittees began investigating the impact 
of the mixed-messages sent to teens about drug use over the 
last four years, and whether this lax attitude has been 
communicated to students through federal drug education 
programs. The Subcommittees are concerned that more money spent 
on the wrong message has led to higher drug use.

            D. establish a framework for policy initiatives

    Although the Subcommittee lacks legislative authority, it 
does play a role in identifying areas ripe for legislation. One 
major project initiated by the Subcommittee involves the 
present and future state of education throughout the United 
States. This effort was intended, among other things, to 
determine the number of education programs available throughout 
the federal government and the value added to education 
programs by the operation of the Department of Education. The 
Subcommittee also gave consideration to merging several 
departments in an effort to reduce duplication, enhance their 
usefulness and to the concepts of school choice.

760 Project--Excellence in Education: What Works? and What's Wasted?

    In 1996, the Subcommittee devised the most comprehensive 
list of federal education programs that has ever been compiled. 
The Subcommittee found that there are over 760 federal 
education programs which span 39 agencies, commissions, and 
boards that cost the taxpayer $120 billion (based upon fiscal 
year 1995 figures). Each of these programs have been designated 
as educational by either the President's Office of Management 
and Budget (OMB) or Congressional Research Service (CRS).
            The General Accounting Office report on schools and 
                    workplaces
    In early 1995, the Subcommittee requested that the General 
Accounting Office (GAO) conduct a review of what works in 
schools and workplaces throughout the country. GAO began its 
research by reviewing existing research on best practices in 
schools and the workplace. After extensive review, the GAO 
compiled a detailed bibliography of this research. Each 
bibliography entry features the author, practice, setting, 
source of information, findings and conclusions, and final 
comments. The scope of this study was based upon specific 
criteria. For schools, the criteria was 1) student achievement 
at or above the expected level, 2) high teacher and student 
engagement in learning activities, and 3) effectiveness in 
overcoming academic disadvantages among students. For the 
workplace, the criteria was 1) increased profitability, 2) 
improved productivity, and 3) high performance in the 
workplace.
    The GAO found that successful schools encourage parental 
involvement and collaboration with and among staff, foster 
leadership for instructional improvement, and authorize school-
level problem solving. They also noted that these schools 
provide safe and orderly sites which in turn promotes fewer 
distractions. In terms of curriculum and instruction, 
successful schools establish academically rigorous and well-
focused curricula, provide effective and engaging instruction, 
and ensure that students who need extra assistance are given 
opportunities for success.
    Successful workplaces typically develop a set of core 
organizational values which are then transmitted to all 
employees, foster a sense of community throughout the 
organization, and encourage meaningful employee participation 
in the workplace. In addition, successful companies tend to 
adopt human resource policies that feature minimal job 
disruption and provide education and training programs for 
their employees. They also tend to engage in profit-sharing and 
gain-sharing plans.
    The Subcommittee found the GAO report to be an excellent 
vehicle to forward the message that good things are happening 
all over the United States in both schools and workplaces. In 
schools all over the country, students are beating the odds and 
graduating with profitable skills and companies are improving 
the workplace in hopes of building worker confidence, self-
esteem, and loyalty which will result in higher productivity.
            Leading edge practices in education: What works in Chicago
    On May 19, 1995 in Chicago Illinois, the Subcommittee held 
a hearing on ``Leading Edge Practices in Learning'' and visited 
local schools, including Our Lady of the Gardens Elementary 
School. The Subcommittee observed very successful educational 
programs and practices which required little in financial 
resources.
    In 1988, the city passed sweeping educational reform 
legislation in order to improve Chicago's school system. The 
1988 Chicago School Reform Act was designed to decentralize the 
Chicago Public Schools and place control with the individual 
communities. Since implementation of these reforms, principals 
are more accountable to the Local School Councils and they 
receive greater control over school budgets, the physical 
plant, and recruitment and hiring of personnel.

Departmental reorganization

    In the age of an intrusive and bureaucratic federal 
government, many have questioned the role of the Department of 
Education and the Department of Labor. Consequently, the 
Committee held two hearings regarding the federal role in 
education, the possible merger of federal departments, and use 
of block grants.
    On June 5, 1995, the Committee held a hearing to provide a 
historical overview of the Department of Education, the 
Department of Labor, and the Equal Employment Opportunity 
Commission. This hearing also gave the Committee Members the 
opportunity to review the Back to Basics Education Reform Act. 
The second hearing, on July 21, 1995, focused primarily on the 
Department of Labor and the Equal Employment Opportunity 
Commission merger.
    As a result of these hearings, it became apparent that 
little was known about the operations, activities, and costs of 
the off-site offices maintained by the Department of Education 
and the Department of Labor. Additionally, it was determined 
that the Department of Labor itself was unaware of the number 
of off-site offices it maintained. Consequently, the GAO 
independently prepared a report illustrating, among other 
things, the sheer magnitude of federal funds expended on off-
site offices by the Department of Education and the Department 
of Labor. For example, the GAO reported:

          In fiscal year 1995, the Departments of Education and 
        Labor had a field structure composed of 1,146 field 
        offices and 22,000 authorized staff positions assigned 
        to the offices.

    These hearings served as potent reminders that the 
Department of Education and the Department of Labor have a 
fiduciary responsibility to every taxpayer. The Committee is 
committed to fulfilling its responsibility to ensure that the 
taxpayers hard earned dollars are spent more responsibly.

Oversight of the DC public schools

    Speaker of the House Newt Gingrich, as a part of his 
government-wide reform efforts, promised to make oversight of 
the District of Columbia one of his first priorities in the 
104th Congress. This led to the establishment of a Speaker's 
Task Force on the District of Columbia, which included several 
Members from several committees, each charged with oversight of 
particular aspects of the City's operations (housing, welfare, 
taxes, education, etc.) The Subcommittee held hearings 
regarding the needs of D.C. schools.
    The D.C. Public Schools have an annual budget of over $700 
million--$70 million of which is provided in federal grants 
(e.g., Title I, Spec. Ed., etc.). While the District is unable 
to ascertain the number of students enrolled, enrollment is 
estimated to be anywhere between 70,000 and 85,000 students. 
Spending could be as high as $11,000 per pupil, which makes the 
District near the top of the country in spending per pupil. 
Despite this fact, student achievement and facilities 
maintenance continue to deteriorate.
    It is estimated that only 56 percent of students that start 
the 10th grade in the D.C. Public School system receive their 
diplomas. There is an 8.2 percent annual dropout rate. In 1994, 
the average score on the verbal portion of the SAT was 333 for 
D.C. students compared to a national average of 423. Likewise, 
the average score on the math portion was only 373, over one-
hundred points lower than the national average of 479. On the 
National Assessment of Educational Progress (NAEP tests) the 
District lagged all other states in 4th grade reading and 8th 
grade math proficiencies.
    At the same time, the District has experienced repeated 
delays in opening its schools due to fire code violations and 
various problems with its facilities. The General Accounting 
Office (GAO) has estimated the cost of repairing D.C.'s 
existing facilities at over $460 million--approximately $90 
million of which constitutes fire code violations. The District 
currently spends approximately $100 million annually on 
maintenance of its facilities. The average age of a D.C. Public 
School is 50 years.
    In short, there is a real educational crisis in urban 
education generally, and in D.C. in particular.
            Hearings
    The Subcommittee convened three hearings on the D.C. Public 
Schools in May and June 1995. These hearings included members 
of the D.C. City Council, a spokesperson for the Mayor, the 
Superintendent, the President of the Board of Education, 
business groups, parents, and community leaders. In addition, 
the Subcommittee sought information from outside sources 
including principals from successful schools and school 
districts in other urban areas and from private businesses and 
scholars for reform ideas.
    The goal of the hearings was to get detailed, first hand 
information on the problems in the D.C. Public Schools and 
their effect on the education of children. Secondly, the 
hearings sought to begin a dialogue on possible reform efforts 
that could alleviate the current state of crisis. Finally, the 
Subcommittee hoped that the continual involvement of each of 
the key parties involved in the system would lead to a 
consensus for prudent reform.

School choice

    Milwaukee, Wisconsin and Cleveland, Ohio are the only 
cities in America currently operating school choice programs 
that allow low-income families to send their children to 
private schools under a State-sponsored voucher program. 
Additionally, the entire state of Vermont for several decades 
has maintained a tuition reimbursement program for high school 
students residing in rural areas to attend the school of their 
choice.
    On October 23, 1995, the Subcommittee held a hearing in 
Milwaukee, Wisconsin on its private school choice program. This 
hearing included witnesses from the State and local government, 
parents, community activists, scholars, and school leaders. The 
hearing highlighted the importance of urban education and the 
need to force change in urban schools. There was a broad 
consensus that giving parents the power to choose their 
children's school would not only benefit their children in the 
short term, but would also lead to improved public schools in 
the long term.
    The Subcommittee remains committed to tracking Milwaukee's 
experience with educational choice, as with other reform 
efforts around the country.

     E. Provides for a Federal Role Only Where Absolutely Necessary

    Over the years, the federal government continued to grow 
and to play a more prominent role in the lives of Americans and 
their businesses. During the last several Congresses, Americans 
saw an explosion of new laws being implemented by agencies and 
departments of the federal government which affected the way in 
which they conducted their businesses. With this explosion came 
the related costs of implementing and monitoring compliance by 
the business community with these new laws. As a result, the 
Subcommittee began a review of the costs of regulations.

Review of government regulation

    On February 2, 1995, the Subcommittee held a hearing to 
examine the costs and benefits of federal regulations. The 
Subcommittee received oral testimony from Dr. Gallaway, 
Professor of Economics, Ohio University, Dr. Hahn, Scholar, the 
American Enterprise Institute, Dr. Hopkins, Professor of 
Economics, Rochester Institute of Technology, and Brenda 
Efinger, Hamlet Response Coalition.
    This hearing uncovered that government regulation, however 
effectively designed or well intentioned, imposes significant 
costs on those regulated and indirectly on the rest of society. 
Many of the costs related to regulations are obvious and 
measurable, while others are hidden and difficult to quantify. 
At this hearing, several economists presented their accounting 
of federal regulations.
            Economics of regulation
    A February 2, 1995 hearing held by the Subcommittee noted 
that regulation increases the price of labor, which causes 
employers to hire fewer employees or to decrease wages to 
account for the added cost of their compliance with these 
regulations. While some of these costs are offset by improved 
working conditions for employees, it is unclear whether the 
employees would, if given the option, choose the improved 
conditions over their lost wages or their own (or their co-
workers) loss of employment. Because the effects of regulations 
are hidden, many workers are unaware that they bear much of the 
cost of compliance without being allowed any choice over the 
matter.
    The Center for the Study of American Business summarized 
the economic costs of regulation as follows:
    Regulation costs the taxpayer in increased taxes to support 
regulatory bureaucracy; the consumer in higher prices to cover 
the expense of regulation; the worker in lost jobs and lower 
wages; the economy in the loss of small businesses due to 
compliance costs; and society in the loss of new and better 
products, and lower standards of living.
    While this may be an oversimplification, the bottom line is 
that regulation costs money.
            The trend toward increased regulation
    Two of the economists testified that the beneficial returns 
to regulation have been steadily decreasing since the early 
part of this century. While not universally accepted, it is 
thought that with the onset of the industrial revolution, there 
may have been many business excesses that lent themselves 
easily to the corrective nature of regulation. As the economy 
became more advanced, however, many of these once corrective 
laws became burdensome and unnecessary.
    While the return to regulation has been steadily 
decreasing, these economists noted that the desire to regulate 
has not. Probably the most disturbing testimony from our 
economists concerned the recent trend toward increased 
regulation. As measured in the following three ways, budgets of 
regulatory agencies, staff size of regulatory agencies, and 
numbers of pages in the Federal Register (where new regulations 
are written), regulation is once again on the rise. While these 
three measures are anecdotal, they are a fairly consistent 
indication of income and employment. Specifically, increases in 
regulation have been correlated with decreases in incomes and 
employment. Recent passage of new regulations (Americans with 
Disabilities Act (ADA), Civil Rights Act of 1990, Family 
Medical Leave Act (FMLA)) and the continued implementation of 
new rules for existing regulations, will drive down both income 
and employment.
            Economy wide costs of regulation
    Regulations impose significant costs on society. Several 
economists have attempted to estimate this cost, but caution 
that such a task is nearly impossible. The following are some 
``best estimates'' of the cost of regulation made by economists 
that testified before the Committee.
          $600 billion is spent annually on direct regulatory 
        compliance by regulated firms. Government expenditures 
        on enforcement and administration are not included in 
        this figure.
          This is equal to an annual tax of $6,000 per family--
        an amount equal to half of all taxes collected by the 
        federal government.
          The above regulatory costs do not include the hidden 
        cost associated with lost productivity due to forced 
        changes in efficient firm practices required to meet 
        regulatory compliance.
    Listed below are specific costs associated with some of the 
regulations under the jurisdiction of the Committee on Economic 
and Educational Opportunities.
          $500 million to $1.2 billion in additional costs to 
        the federal government from inflated wages in federal 
        contracts required under the Davis-Bacon Act.
          Annual costs of $8.5 billion to comply with the 
        Occupational Health and Safety Act as of 1988--well 
        before the increased burdens promulgated in the late 
        1980's.
          Equal Employment Opportunities Commission direct 
        costs of compliance of $900 million.
    For the EEOC, total costs, including litigation and lost 
productivity, have been estimated at several hundred billion 
dollars.
            Regulatory harmonization
    In light of the regulatory costs uncovered at the 
Subcommittee's February 1995 hearing, and coupled with the 
repeated complaints received by the Subcommittee concerning 
overlapping and duplicative regulations, the Subcommittee held 
a follow-up hearing on ``Conflicts and Inconsistencies in 
Workplace Regulations'' on April 4, 1996.
    Because Executive Branch agencies often have different 
priorities, many of the regulations that are written and 
implemented overlap and are inconsistent and sometimes 
conflict. When conflicts and overlaps occur, non-compliance, 
confusion, and costs increase. Additionally, the Subcommittee 
learned that employers often face dual enforcement and dual 
penalties due to regulatory overlaps.
    The Subcommittee heard from Ms. Sally Katzen, the 
Administrator of the Office of Information and Regulatory 
Affairs (OIRA) at the OMB. This is the lead agency in charge of 
the Administration's oversight of federal regulations and is 
specifically charged with finding and eliminating regulatory 
conflict. Ms. Katzen admitted that regulatory conflicts have 
become a serious problem, but that agencies should not be held 
responsible for conflicts inherent in laws passed by Congress. 
Furthermore, she noted that OIRA, under the direction of 
Executive Order 12866 was in the process of reviewing all 
regulations to root out such conflicts.
    During the April 1996 hearing, it became apparent that 
several companies viewed regulatory agencies as ``the enemy'' 
and were hesitant to seek counsel from such agencies for fear 
of becoming liable for any violations that were revealed while 
seeking advice. Additionally, each of the witnesses testified 
to the complexity of these regulations, and the apparent lack 
of flexibility afforded to the companies in meeting the stated 
goals of the original statutes.
            GAO study on regulatory burden
    Based on the testimony of the above two hearings, the 
Subcommittee requested that the GAO investigate the cost of 
regulations and the difficulty companies have in complying with 
the numerous rules and regulations issued annually by the 
myriad of federal agencies and departments charged with 
implementing these regulations.
    A draft of the GAO report, ``Regulatory Burden: Selected 
Companies' Concerns and Agencies Responses'' was released in 
August 1996. While the findings are not yet final, several 
initial conclusions are apparent. First, the GAO sought broad 
participation in this study, but had difficulty finding 
companies that would be willing to participate and many of 
those that ultimately chose to cooperate chose to remain 
anonymous. This underscores the nervousness companies feel in 
having any federal agency review their regulatory compliance.
    Second, the companies that did participate had difficulty 
developing lists of applicable regulations. Reasons noted for 
this difficulty ranged from the fact that some of the 
regulations were normal business practice anyway, to the 
overlap with State and local regulations, to general confusion 
about what regulations were applicable to a given company. 
Third, companies lacked data concerning the costs of 
regulations. This was due mainly to the fact that few companies 
separated out the incremental costs of actions taken because of 
regulation from actions that would have taken place anyway, 
regardless of any regulations. Fourth, several companies noted 
that some regulations have been beneficial, not only from a 
safety and health aspect, but from a competitive standpoint. In 
particular, having uniform rules reduced the chance that 
competitors would opt to undercut prices by shirking their 
responsibilities to provide safe work environments.
    Finally, the draft GAO report documents 100 separate cases 
where companies cite specific concerns about the regulatory 
process. These span problems with the cost and reasonableness 
of compliance, excessive paperwork, severe penalties, a 
``gotcha'' enforcement approach by regulators, and poor 
coordination between agencies and departments. In short, this 
report highlights many of the issues uncovered by the 
Subcommittee.

                 II. Meetings Held by the Subcommittee

104th Congress, First Session

    January 26, 1995--Oversight hearing on reexamining old 
assumptions.
    February 2, 1995--Joint oversight hearing on the impact of 
workplace and employment regulation on business, held with the 
Subcommittee on Regulation and Paperwork of the Committee on 
Small Business.
    February 9, 1995--Oversight hearing on block grant/
consolidation review.
    February 16, 1995--Oversight hearing on the Occupational 
Safety and Health Act (OSHA).
    March 22, 1995--Oversight hearing on education standards.
    March 27, 1995--Oversight hearing on obtaining federal and 
state assistance.
    April 4, 1995--Oversight hearing on identifying conflicts 
and inconsistencies in workplace regulations.
    May 12, 1995--Oversight hearing on District of Columbia 
school reform.
    May 19, 1995--Oversight field hearing on leading edge 
practices in education, held in Chicago, Illinois.
    May 23, 1995--Oversight hearing on federal student loan 
programs.
    June 8, 1995--Oversight hearing on District of Columbia 
school reform.
    June 14, 1995--Oversight hearing on accreditation of 
graduate medical education.
    June 27, 1995--Oversight hearing on District of Columbia 
school reform.
    July 12, 1995--Oversight hearing on the National Labor 
Relations Board.
    October 17, 1995--Oversight hearing on AmeriCorps.
    October 23, 1995--Oversight field hearing on school choice, 
held in Milwaukee, Wisconsin.
    October 31, 1995--Oversight hearing on union corporate 
campaign tactics (salting).
    December 5, 1995--Oversight hearing on parents, schools and 
values.
    December 6, 1995--Oversight hearing on parents, schools and 
values.

104th Congress, Second Session

    January 18, 1996--Joint oversight field hearing on the 
Davis-Bacon Act/Oklahoma Fraud Allegations, held with the 
Committee's Subcommittee on Workforce Protections, in Oklahoma 
City, Oklahoma.
    March 19, 1996--Oversight hearing on the financial findings 
of the Corporation for National Service.
    April 25, 1996--Oversight hearing on abuse of power at the 
Department of Labor.
    June 20, 1996--Joint oversight hearing on Davis-Bacon/GAO 
Report, held with the Committee's Subcommittee on Workforce 
Protections.
    July 10, 1996--Oversight hearing on Split Decision: The 
Inspector General's Report on the Divided Management Structure 
of Student Aid Programs at the Department of Education.
    September 26, 1996--Oversight hearing on the financial 
findings of the Corporation for National Service.

                      III. Subcommittee Statistics

Total Number of Hearings..........................................    25
    Field.........................................................     3
    Joint with other Committees...................................     1

                                
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