National Service Programs: Role of State Commissions in Implementing the
AmeriCorps Program (Letter Report, 02/20/97, GAO/HEHS-97-49).

Pursuant to a legislative requirement, GAO reviewed state commissions'
capacity to absorb additional AmeriCorps program management
responsibility, focusing on: (1) the statutory role of state
commissions; (2) state commission operations, including project-level
outputs from national service projects within their purview, such as
participant enrollment and expenditure data; and (3) extending state
commissions' administrative and oversight role over AmeriCorps and
correspondingly decreasing the federal government's role.

GAO found that: (1) by assigning state commissions significant
responsibilities, the National and Community Service Trust Act of 1993,
in effect, emphasizes state control of the AmeriCorps program; (2) these
responsibilities include developing a statewide service infrastructure,
selecting and funding AmeriCorps projects, and monitoring and evaluating
projects; (3) state commissions directly control two-thirds of the
federal funds available for AmeriCorps projects; (4) for fiscal year
1995, state commissions received $131 million of $192 million available
in federal funding; (5) GAO's review of seven state commissions
indicated that all are performing program management activities
envisioned by the act, but vary in terms of their infrastructures and
project outputs; (6) operational resources of the state commissions in
GAO's sample varied widely; (7) for selected projects, outputs also
varied both within and among the state commissions; (8) officials from
the seven state commissions agreed on the need for a federal role in
AmeriCorps, but disagreed on how much federal control is desirable; (9)
on one hand, all officials agreed that only a federal entity can provide
AmeriCorps with a national identity, which they considered essential;
(10) on the other hand, they disagreed on the role the Corporation for
National and Community Service should play in allocating AmeriCorps
funding grants; (11) senior Corporation officials agreed with state
officials that a federal role is necessary to provide the AmeriCorps
program with a national identity; (12) they also stated that a federal
role is necessary to conduct performance evaluations of national service
projects and state commissions; (13) these officials acknowledged that
changes to the funding allocation process might better achieve the
Corporation's quality control objectives and said they may recommend
changes to Congress when it considers reauthorization of the act; and
(14) Corporation officials noted that, notwithstanding their view that
the act gave the states a substantial degree of control over the
program, they have initiated actions to increase state commissions'
autonomy.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-97-49
     TITLE:  National Service Programs: Role of State Commissions in 
             Implementing the AmeriCorps Program
      DATE:  02/20/97
   SUBJECT:  State-administered programs
             Grants-in-aid
             Community development programs
             Grant award procedures
             Intergovernmental fiscal relations
             Volunteer services
             Educational grants
             Higher education
             Federal corporations
IDENTIFIER:  AmeriCorps USA Program
             AmeriCorps National Direct Grant
             California
             Maryland
             Missouri
             Rhode Island
             Texas
             Virginia
             Washington
             AmeriCorps State/National Program
             Volunteers in Service to America Program
             
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Cover
================================================================ COVER


Report to the Congress

February 1997

NATIONAL SERVICE PROGRAMS - ROLE
OF STATE COMMISSIONS IN
IMPLEMENTING THE AMERICORPS
PROGRAM

GAO/HEHS-97-49

Role of AmeriCorps State Commissions

(104875)


Abbreviations
=============================================================== ABBREV

  FTE - full-time equivalent
  NCCC - National Civilian Community Corps
  VISTA - Volunteers in Service to America

Letter
=============================================================== LETTER


B-275765

February 20, 1997

The Honorable Christopher S.  Bond
Chairman, Subcommittee on VA, HUD,
 and Independent Agencies
Committee on Appropriations
United States Senate

The Honorable Charles E.  Grassley
United States Senate

With the National and Community Service Trust Act (the act) of 1993
(P.L.  103-82), the Congress created the largest national and
community service program since the Civilian Conservation Corps of
the 1930s.  AmeriCorps, the act's signature program, is jointly
administered by the Corporation for National and Community Service
(the Corporation) and state commissions.  AmeriCorps allows
participants to earn education awards to help pay for postsecondary
education in exchange for performing community service that matches
priorities established by the Corporation.  In an era marked by
fiscal austerity, AmeriCorps has experienced substantial growth
relative to other domestic programs in budgetary terms.  Through
fiscal year 1997, the Congress has appropriated over $800 million to
support about 100,000 AmeriCorps participants.  Amid concerns over
costs and internal controls, however, considerable congressional
oversight activity has accompanied AmeriCorps' appropriations. 

Several studies of the Corporation's first operating year have been
completed.  Between January 1995 and May 1996, at the request of the
Congress, we conducted three studies that focused on AmeriCorps
program resources and benefits.  In March 1996, the Corporation's
Inspector General issued five reports on the Corporation's financial
management systems and its 1994 AmeriCorps National Direct grant
award process.  The results from these reviews prompted several
initiatives aimed at lowering AmeriCorps' costs. 

Under the Omnibus Consolidated Rescissions and Appropriations Act of
1996 (P.L.  104-134) and the Omnibus Consolidated Appropriations Act
of 1997 (P.L.  104-208), the Congress mandated new funding
restrictions for the Corporation.  One provision makes federal
agencies ineligible to receive AmeriCorps grants, while another
directs the Corporation, to the greatest extent possible, (1) to
increase the amount of matching contributions provided by the private
sector and (2) to reduce AmeriCorps' total federal cost per
participant.  Among the program reforms contemplated during the 1996
appropriation process, some Members of Congress expressed interest in
scaling back AmeriCorps' federal bureaucracy and transferring more
program management to state commissions. 

To better gauge state commissions' capacity to absorb additional
program management responsibility, the Congress mandated through the
Omnibus Consolidated Rescissions and Appropriations Act that we study
state commission programs.  Because of your long-standing interest in
AmeriCorps, we coordinated our work with representatives from your
offices and agreed to address our report to you.  On the basis of
discussions with your staff, we agreed to provide information on the
following three issues: 

  -- the statutory role of state commissions,

  -- state commission operations, including project-level\1 outputs
     from national service projects within their purview, such as
     participant enrollment and expenditure data,

  -- extending state commissions' administrative and oversight role
     over AmeriCorps and correspondingly decreasing the federal
     government's role. 

To conduct our work, we reviewed seven state commissions representing
a range and mix of characteristics, including geographic location,
level of Corporation grant funding, and number of AmeriCorps
participants.  Our state commission sample consisted of California,
Maryland, Missouri, Rhode Island, Texas, Virginia, and Washington. 

To address our research questions, we interviewed state
commissioners, commission executive directors, AmeriCorps project
directors, and Corporation officials.  We also reviewed files at
state commission offices to obtain program documentation or obtained
documentation directly from commission officials. 

We also reviewed 24 AmeriCorps projects administered by the seven
state commissions.  We selected the projects on the basis of the type
of service program, the level of Corporation funding, and whether the
decision to fund the project was made solely by the state commission
or jointly with the Corporation.  For each project, we reviewed (1)
expenditure data; (2) data on participant enrollment, attrition, and
education award usage; and (3) information on projects' service
activities.  Appendix I lists the AmeriCorps projects we selected and
briefly describes each project. 

Where possible, we reviewed the most recent data available in
comparing the operations of the seven state commissions.  For
example, project expenditure and enrollment data were for the 1994-95
program year--the first, and only, completed program year for which
such data were available.  The number of projects that state
commissions were currently administering at the time of our review
were those funded with fiscal year 1995 federal funds.  Finally,
because of differences between the federal and state governments'
fiscal years and the AmeriCorps program's operating year, we compared
state commissions' operating budgets on the basis of their federal
fiscal year 1996 allocations. 

Because the data are self-reported and unverified, and we reviewed a
judgmentally selected sample of state commissions, our results cannot
be generalized beyond the commissions and programs studied.  With
these exceptions, our work, done between July and November 1996, was
in accordance with generally accepted government auditing standards. 


--------------------
\1 Throughout this report, we use the term "project" to describe the
grantees or subgrantees of federal funds that are provided either by
the Corporation or the state commissions to conduct national service
activities authorized by the act.  We use the term "program" to refer
to AmeriCorps projects collectively. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

By assigning state commissions significant responsibilities, the
National and Community Service Trust Act of 1993, in effect,
emphasizes state control of the AmeriCorps program.  These
responsibilities include developing a statewide service
infrastructure, selecting and funding AmeriCorps projects, and
monitoring and evaluating projects.  State commissions directly
control two-thirds of the federal funds available for AmeriCorps
projects.  For fiscal year 1995, state commissions received $131
million of $192 million available in federal funding. 

Our review of seven state commissions indicated that all are
performing program management activities envisioned by the act but
vary in terms of their infrastructures and project outputs.  For
example, all seven state commissions developed strategic plans to
identify priority service needs and selected and funded projects
consistent with their plans.  Operational resources of the state
commissions in our sample varied widely, however.  For example, while
California's commission employed 18 full-time equivalent (FTE) staff
and commanded a 1996 fiscal year budget of about $1.3 million, Rhode
Island's commission employed 3.5 FTE staff and managed a budget of
$183,000 for the same period.  For the selected projects, outputs
also varied both within and among the state commissions.  For
example, the Washington commission's projects had from 33 to 350
participants, and among the seven states, project expenditures ranged
from $206,000 to $3.9 million. 

Officials from the seven state commissions agreed on the need for a
federal role in AmeriCorps but disagreed on how much federal control
is desirable.  On one hand, all officials agreed that only a federal
entity can provide AmeriCorps with a national identity, which they
considered essential.  On the other hand, they disagreed on the role
the Corporation should play in allocating AmeriCorps funding grants. 
For example, California officials believed that all funds should be
proportionally allocated to states based on population, leaving the
Corporation no substantive role.  Conversely, Rhode Island officials
believed that the Corporation should allocate funds to states based
on its judgment of the quality of the states' projects, giving the
Corporation a significant role. 

Senior Corporation officials agreed with state officials that a
federal role is necessary to provide the AmeriCorps program with a
national identity.  They also stated that a federal role is necessary
to conduct performance evaluations of national service projects and
state commissions.  These officials acknowledged that changes to the
funding allocation process might better achieve the Corporation's
quality control objectives and said they may recommend changes to the
Congress when it considers reauthorization of the act.  Finally,
Corporation officials noted that, notwithstanding their view that the
act gave the states a substantial degree of control over the program,
they have initiated actions to increase state commissions' autonomy. 


   BACKGROUND
------------------------------------------------------------ Letter :2

In creating AmeriCorps, the Congress chartered a federal corporation
to work with the states to fund local national and community service
projects.\2 The President appoints a chief executive officer and a
15-member bipartisan board of directors that is confirmed by the
Senate to govern the Corporation; each member serves a 5-year term. 
The board has the authority to review and approve the strategic plan
and proposed grant decisions.  The Corporation provides grants to
AmeriCorps projects directly and through states.  To receive
AmeriCorps funds, states must establish commissions on national
service.  These state commissions must have between 15 and 25 members
and be composed of representatives from a variety of fields,
including local government, existing national service programs, local
labor organizations, and community-based organizations.  Since
AmeriCorps began, 48 states, the District of Columbia, and Puerto
Rico have created commissions.  These state commissions, in turn,
subgrant AmeriCorps funds to local community service projects. 


--------------------
\2 The Corporation also administers other programs.  For example, the
Learn and Serve America program incorporates service learning in the
curriculum of students from kindergarten through graduate school.  In
addition, the National Senior Volunteer Corps program includes the
Retired and Senior Volunteers, Foster Grandparent, and Senior
Companion programs, which support community service by senior adults. 
These programs are funded through renewable project grants to public
and private nonprofit organizations that work with schools,
hospitals, senior centers, and other organizations that directly
assign and supervise participants. 


      FEDERAL AND STATE PROGRAM
      ROLES
---------------------------------------------------------- Letter :2.1

The act gives critical program responsibilities to both the federal
and state governments.  Because national service was intended to
address community needs, the act sought to balance a centralized
federal program role with state responsibility for planning,
implementing, and overseeing most eligible AmeriCorps projects
because state governments are thought to be closer to and therefore
more knowledgeable about community needs.  Although it directly
selects and oversees some AmeriCorps projects, the Corporation is
primarily responsible for establishing national criteria for
determining projects' eligibility for federal funds and for assisting
the states in carrying out their program responsibilities.  Both the
Corporation and the states are jointly responsible for other program
areas such as providing training and technical assistance to local
AmeriCorps projects.  Table 1 lists the Corporation's and the states'
responsibilities. 



                                     Table 1
                     
                        Federal and State National Service
                             Program Responsibilities

Corporation for National                              Corporation and state
and Community Service      State commissions          commissions
-------------------------  -------------------------  --------------------------
Determine national         Determine state service    Provide assistance and
service needs              needs and develop service  training to local
                           infrastructure             projects
Administer education
award trust fund           Issue applications for     Evaluate projects
                           AmeriCorps funds
Promote national                                      Develop strategies to
identity                   Select and fund certain    leverage additional funds
                           state-administered         to support projects
Disburse grant funds to    projects; preselect other
states                     projects for competitive   Recruit, refer, and place
                           funding                    AmeriCorps participants
Select and fund certain
projects directly          Administer state
                           AmeriCorps projects
Assist state commissions
--------------------------------------------------------------------------------

      AMERICORPS*STATE/NATIONAL
      PROGRAM
---------------------------------------------------------- Letter :2.2

AmeriCorps*State/National is the Corporation's flagship AmeriCorps
program.\3 AmeriCorps*State/National participants earn an education
award of up to $4,725 for full-time service or half that amount for
part-time service.  A minimum of 1,700 hours of service within a year
is required to earn the full $4,725 award.  To earn a part-time
award, a participant must perform 900 hours of community service
within 2 years (or within 3 years in the case of participants who are
full-time college students).  Individuals can serve more than two
terms; however, they can receive only federally funded benefits,
including education awards, for two terms.  The Corporation allows
projects to devote some portion, not more than 20 percent, of
participants' service hours to nondirect service activities, such as
training or studying for the equivalent of a high school diploma. 

With regard to attrition, participants can earn prorated education
awards if they are released for compelling personal circumstances,
such as illness or critical family matters, and have served at least
15 percent of their service term.  Participants released for cause
are ineligible to receive an education award and may disqualify
themselves from future service in AmeriCorps.  Participants may be
released for cause for a variety of reasons, including being
convicted of a felony, chronic truancy, or consistent failure to
follow directions.  In addition, participants released for cause may
include those who leave a project early to take advantage of
significant opportunities for personal development or growth, such as
educational or professional advancement.  Education awards, which are
held in trust by the U.S.  Treasury, are paid directly to qualified
postsecondary institutions or student loan lenders and must be used
within 7 years after service is completed. 

In addition to the education award, AmeriCorps*State/National
participants receive a living allowance stipend that is at least
equivalent to, but no more than double, the average annual living
allowance received by VISTA volunteers--about $7,500 for full-time
participants in fiscal year 1996.  Additional benefits include health
insurance and child care assistance for participants who qualify for
such support. 

Individuals can join a national service project before, during, or
after postsecondary education, but must be a high school graduate,
agree to earn the equivalent of a high school diploma before
receiving an education award, or be granted a waiver by the project. 
A participant must be 17 or older and be a citizen, a national, or a
lawful permanent resident alien of the United States.  Selection of
participants is not based on financial need.  In its fiscal year 1997
appropriations, the Corporation anticipated fielding about 24,000
full- and part-time AmeriCorps*State/National participants. 


--------------------
\3 The other AmeriCorps programs are the AmeriCorps*National Civilian
Community Corps (NCCC) and the AmeriCorps*VISTA programs.  NCCC
recruits 18- to 24-year-olds for environmental service activities. 
Members live on campuses at closed or downsized military facilities. 
VISTA (Volunteers in Service to America), established in 1965, is a
full-time service program that addresses poverty-related problems. 
Participants serve with community-based public and private nonprofit
organizations and serve in capacity-building assignments. 


      GRANT AWARD PROTOCOLS
---------------------------------------------------------- Letter :2.3

The act created three types of grant awards as funding streams for
AmeriCorps*State/National projects:  formula, competitive, and
national direct.  The act lists criteria that state commissions and
the Corporation must use in selecting AmeriCorps projects for grant
awards.  The principal criteria include project quality, innovation,
and sustainability.  In addition, service projects must address
community education, public safety, human, or environmental needs. 
States may develop additional criteria, based on identified service
needs, to use in selecting projects for state formula grants. 
Similarly, the Corporation develops additional criteria that reflect
particular national needs that states use to nominate projects for
competitive grant awards and that the Corporation uses to select
projects for national direct grants. 

  -- State formula grants:  One-third of the funds appropriated for
     AmeriCorps*State/National grants are distributed to state
     commissions strictly on the basis of population.  In fiscal year
     1995, state commissions were awarded about $67 million to
     support 262 projects using formula grants. 

  -- State competitive grants:  At least one-third of funds
     appropriated for AmeriCorps*State/National grants are awarded to
     state commissions on a competitive basis.  The Corporation ranks
     the highest quality projects among those submitted by the states
     for these funds.  In fiscal year 1995, the Corporation awarded
     another $64 million to state commissions to finance 103 projects
     using competitive grants. 

  -- National direct grants:  The Corporation competitively awards
     the remaining appropriations to public or private nonprofit
     organizations, institutions of higher education, or multistate
     organizations.  In fiscal year 1995, the Corporation directly
     awarded about $58 million to support 57 projects using national
     direct grants. 


      AMERICORPS*STATE/NATIONAL
      GRANTEES
---------------------------------------------------------- Letter :2.4

AmeriCorps grantees use grant funds to pay up to 85 percent of the
cost of participants' living allowances and benefits\4 and up to 67
percent of other project costs,\5 including participant training,
education, and service gear; staff salaries, travel, transportation,
supplies, and equipment; and project evaluation and administrative
costs.  To ensure that federal Corporation dollars are used to
leverage other resources for project support, grantees must also
obtain support from non-Corporation sources to help pay for the
project.  This support, which can be cash or in-kind contributions,
may come from other federal sources as well as state and local
governments, and private sources.  In-kind contributions include
personnel to manage AmeriCorps*State/National projects and to
supervise and train participants; office facilities and supplies; and
materials and equipment needed in the course of conducting national
service projects. 


--------------------
\4 For one benefit, child care, the Corporation pays 100 percent. 

\5 Before fiscal year 1997, grant funds paid up to 75 percent of
these other project costs. 


   NATIONAL SERVICE STATUTE
   PROVIDES STATE CONTROL
------------------------------------------------------------ Letter :3

The National and Community Service Trust Act provides for extensive
state control of AmeriCorps.  State commissions must develop
strategic plans that identify state educational, public safety,
human, and environmental service needs.  On the basis of these plans
and the act's criteria, commissions select projects to finance with
formula grant funds and nominate other projects to the Corporation as
candidates for competitive grants.  Commissions have ultimate
responsibility for administering both formula and competitive awards. 
In addition, commissions must monitor and evaluate the performance of
the AmeriCorps projects under their purview and assess projects'
compliance with state and federal regulations.  These reviews
determine whether commissions renew funding for AmeriCorps projects
in succeeding years. 

Commission officials in all seven states told us they used a
grassroots effort to develop their strategic plans and identify
service needs.  They said they sought input from a broad
cross-section of individuals and organizations to ensure extensive
input in identifying state service needs.  Most commission officials
said they solicited public comment through local and regional
meetings and other public forums.  For example, one commission mailed
meeting announcements to various government, nonprofit, and
community-based organizations.  Another commission mailed over 1,000
invitations to various service programs and individuals.  Another
state commission used interactive computer technology to coordinate
input from 60 individuals collectively representing over 250
organizations. 

After developing state plans and prioritizing service needs,
commissions used a variety of measures to identify, develop, and
select AmeriCorps projects.  For example, while some commissions
published request-for-proposals packages, others solicited proposals
from existing community service and government agencies, and some
held regional meetings around the state where local organizations
identified community needs and proposed projects to address them.  In
general, state commissions convened review panels to assess project
proposals and rank them according to how well they met the state's
needs and priorities as established in the state's strategic plan. 
One review panel was composed only of the commissioners themselves;
others used panels made up of commissioners, commission staff, and
local service project officials; while another included citizens with
academic and public service backgrounds.  State commissioners, using
the results of these panels, then selected projects to fund with the
state's allotted formula funds or to submit to the Corporation for
competition with other state commissions' selections. 

Commission officials in all seven states told us they based their
project monitoring and evaluation protocols on Corporation
guidelines.  Some state commissions developed additional evaluation
and monitoring measures to ensure projects remain in compliance. 
Commission staff in six of the states conducted project site visits,
while in Texas, commissioners themselves conducted on-site reviews. 
Typically, the commissions used their site visit results and periodic
reports submitted by project administrators to determine whether
projects effectively achieved project objectives. 


   COMMISSION OPERATIONS
------------------------------------------------------------ Letter :4

States chose to organize their commissions in a variety of ways.  The
seven commissions we reviewed fell into one of three organizational
models:  (1) part of a preexisting state agency; (2) an independent
state agency; or (3) a nonprofit agency.  Five commissions operated
within existing state agencies.  For example, the Virginia commission
operated within the state's Department of Social Services. 
California created its commission as an independent agency, while the
Rhode Island legislature decided to charter its state service
commission as a nonprofit agency, thereby obtaining tax-exempt status
from the Internal Revenue Service. 


      COMMISSION BUDGETS AND
      STAFFING VARY
---------------------------------------------------------- Letter :4.1

State commissions' administrative budgets and their staffing levels
varied significantly among the seven states.  For example, in terms
of administrative budgets, the Rhode Island commission managed about
$183,000, while the California commission managed over $1.3 million
in fiscal year 1996.  Also, in regard to staffing levels, the
Virginia commission employed 1.5 FTE staff, while the California
commission employed 18 FTE staff. 

Both federal and state government contributions defined state
commission budgets and their staff resources.  Under the act, the
Corporation awards administrative grants of between $125,000 and
$750,000 to states to help pay for commission operations.  Federal
administrative grants are limited to 85 percent of a commission's
costs in the first year and decrease to 50 percent of costs in the
fifth and subsequent operating years.  States must contribute either
cash or in-kind resources to obtain administrative grants.  Among the
seven states, the type (cash or in-kind) and amount of support
provided by the state varied.  Table 2 lists the commissions' total
budgets and staffing levels for fiscal year 1996. 



                          Table 2
          
           Fiscal Year 1996 Budgets and Number of
            Full-Time Equivalent Staff at Seven
                     State Commissions

State                                 Budget  Staff (FTEs)
------------------------  ------------------  ------------
California                        $1,321,000            18
Maryland                             446,602            13
Missouri                             398,810           2.5
Rhode Island                         182,562           3.5
Texas                                957,279            10
Virginia                             431,284           1.5
Washington                           481,394             5
----------------------------------------------------------
Source:  Corporation for National and Community Service and state
commissions. 


      NUMBER OF STATE COMMISSION
      PROJECTS VARIED
---------------------------------------------------------- Letter :4.2

During the 1995-96 program year, the number of AmeriCorps projects in
the seven states varied depending on (1) the number of projects
commissions financed with their allotted formula funds, (2) the
number of projects that won competitive funding, and (3) the number
of projects funded directly by the Corporation rather than by the
state commissions.  The number of formula- funded projects ranged
from a low of 1 in Rhode Island to a high of 19 in California.  The
number of projects awarded competitive grants ranged from none in
Virginia to eight in Texas.\6 The number of national direct projects
administered by the Corporation in the seven states also varied. 
While only 1 national direct project operated in Virginia, 18 such
projects operated in California.  Table 3 lists the number of state
commission formula and competitive projects and the number of
national directs projects in each state. 



                          Table 3
          
           Projects for the 1995-96 Program Year,
                    by Type and by State

                         State         State
                    commission    commission      National
                       formula   competitive        direct
State                 projects      projects      projects
----------------  ------------  ------------  ------------
California                  19             7            18
Maryland                     4             6            10
Missouri                     5             3             4
Rhode Island                 1             3             3
Texas                       11             8            10
Virginia                     5             0             1
Washington                   5             3             7
----------------------------------------------------------
Source:  Data provided by the Corporation for National and Community
Service. 


--------------------
\6 At the time of our visit, the Virginia state commission had never
submitted projects to the Corporation for competitive funding. 


   PROJECT OUTPUTS VARY
   CONSIDERABLY
------------------------------------------------------------ Letter :5

For the 24 projects we reviewed, outputs and characteristics varied
extensively.  We reviewed information on enrollment, attrition, and
participants' use of education awards for each project.  In addition,
we obtained data on projects' expenditures and the source of
projects' financial support.  To calculate enrollment, we added the
number of full- and part-time participants that began a term of
service for each project.  We calculated attrition rates on two
bases:  (1) the number of participants who ended service early for
cause and (2) the combined total of participants who ended service
early for cause and for compelling personal circumstances.  We
determined education award usage based on the number of participants
who earned either a full or prorated education award and the number
of participants who had used either part of or the full value of
their awards at the time of our review.  The following points
illustrate the extent of variability among the projects: 

  -- Participant enrollment:  AmeriCorps enrollment ranged from 21 to
     350 participants.  The median enrollment was about 46
     participants. 

  -- Attrition rates:  The attrition rate for participants who ended
     service early for cause ranged from 3 to 58 percent.  The median
     attrition rate was 22 percent.  The overall attrition
     rate--participants who ended service early for either cause or
     compelling personal circumstances--ranged from 9 to 95
     percent,\7 and the median was 39 percent. 

  -- Education award usage:  The proportion of participants who
     accessed their education award ranged from 17 to 78 percent. 
     The median was 54 percent. 

Appendix II lists projects' enrollment, attrition rates, and
participant education award usage. 


--------------------
\7 Most of the participants in one project were unable to complete a
full-term of service because the project began operations late. 
According to Corporation records, education awards were prorated for
these participants. 


      PROJECT EXPENDITURES
---------------------------------------------------------- Letter :5.1

Project-level expenditures also varied widely.  Our expenditure data
excluded funding for education awards and for state commission and
Corporation administrative expenses.  Projects obtained cash support
and in-kind resources to cover their expenditures from the
Corporation, other federal agencies, state and local governments, and
the private sector.  The projects' expenditures ranged from $206,000
to $3.9 million.  The median expenditure was $627,000.  The share of
these expenditures that were supported by the following sources was

  -- corporation grants--0\8 to 78 percent (the median was 66
     percent),

  -- public sector resources--49 to 100 percent (the median was 83
     percent), and

  -- private sector sources--0 to 51 percent (the median was 17
     percent). 

Figure 1 illustrates private sector support for all 24 projects. 
Appendix III lists detailed expenditure data for all 24 projects. 

   Figure 1:  Distribution of 24
   AmeriCorps Projects by
   Proportion of Expenditures
   Covered by Private Sector
   Funding

   (See figure in printed
   edition.)


--------------------
\8 For one project in our sample the Corporation is only funding
education awards. 


      PROJECT ACCOMPLISHMENTS
---------------------------------------------------------- Letter :5.2

One of the National and Community Service Trust Act's objectives is
to help the nation address its unmet human, education, environmental,
and public safety needs.  The projects included in our sample all
reported diverse service activities that address one or more of these
needs.  While some projects' service activities were focused on
meeting a particular need within the community, such as housing,
other projects' activities addressed multiple areas of need, such as
environmental and education needs.  In the project reports we
reviewed in detail, participants organized food programs that served
2,500 children; assisted with totally rehabilitating 16 vacant public
housing units; operated a 7-week summer reading camp for 36 children;
planted trees, removed debris, and created gardens improving 32 urban
neighborhoods; and provided parenting classes to low-income families. 


   OFFICIALS AGREE FEDERAL ROLE
   NEEDED, BUT DIFFER ON DEGREE OF
   STATE CONTROL
------------------------------------------------------------ Letter :6

State commissioners and executive directors in all seven states
agreed with senior Corporation officials that a federal role in the
AmeriCorps program is needed.  None of these officials believed that
eliminating the federal Corporation and simply allocating funds
directly to state commissions would serve the program well.  While
some state officials told us that the grant allocation process
warrants significant change, other state officials noted the
indispensability of federal oversight.  Corporation officials
believed that a federal role is needed for conducting nationwide data
gathering on the AmeriCorps program, evaluating the performance of
AmeriCorps projects and state commissions, and providing a central
repository of information on the "best practices" of individual
AmeriCorps projects and state commission operations. 


      FEDERAL ROLE NEEDED
---------------------------------------------------------- Letter :6.1

All seven state commission executive directors agreed that a federal
role is necessary to provide the AmeriCorps program with a national
identity.  According to these officials, a national identity helps
AmeriCorps projects obtain widespread public support.  They told us
that national identity provides AmeriCorps participants with a sense
that the benefits of their service extend not only to themselves and
their communities, but to the whole nation.  Furthermore, they said
AmeriCorps' name recognition and positive reputation help local
projects recruit participants.  To promote national identity, the
Corporation provides AmeriCorps projects national advertisement,
service gear, and the means to network with other projects across the
country to share experience and knowledge.  In addition, the
Corporation encourages projects to adhere to certain standardized
elements such as the ethic reflected by the Corporation's slogan
"getting things done," a standard orientation and pledge, and
participation in national events. 

Most commission officials also welcomed the federal oversight of
AmeriCorps.  Some officials told us that while reducing the federal
role could save money, a lack of oversight would spawn fraud, waste,
and abuse.  Several commission officials, for example, expressed
concern that, without federal oversight, other state officials might
bypass commission offices and fund projects, regardless of whether
they meet national service priorities, to serve partisan agendas. 
Another official said that without a federal role, the AmeriCorps
program would become wholly dependent on the support of the states'
executive leadership, noting a fear for the future of their states'
AmeriCorps programs if elected governors do not support national
service. 

Corporation officials agreed that a national identity for the
AmeriCorps program is important and that a federal role provides it. 
They also noted that the federal government has a vital role in
evaluating the AmeriCorps program, sharing evaluation results with
others, and developing and increasing the evaluation capacity of
state commissions.  They believe that such a role helps to address
the disparity between state commissions' competence and performance
by, in part, serving as a central repository of information on
successful AmeriCorps projects and state commission management
strategies.  Furthermore, evaluating projects and state commissions
ensures that federal taxpayer dollars are efficiently and effectively
used to finance legitimate national service projects. 


      FEDERAL GRANT ALLOCATION
---------------------------------------------------------- Letter :6.2

Commission officials in the seven states disagreed on whether states
should have more control over federal grant funds, particularly in
terms of allocating federal funds.  Some commission officials
supported allocating all three types of grants (formula, competitive,
and national direct) to the states based on population.  The
California contingent advocated allocating all AmeriCorps grant funds
to states using a population-based formula.  California officials
argued that the Corporation's competitive grant-making process is
redundant because it occurs after states review and select projects
for funding on their own.  In addition, these officials told us that
federal selection of AmeriCorps projects usurps the state
commissions' right to exercise their best judgment, expertise, and
creativity in administering national service projects in their
states.  Other officials told us that the competitive grant-making
process promotes equity and ensures that the relatively higher
quality projects receive funding.  Officials in Rhode Island argued
that the competitive grant-making process provides a more equitable
distribution of national resources than strict population-based
allocations.  They said that such simplistic methods arbitrarily
penalize states with small populations and reward states with large
populations, while ignoring the variability in quality among national
service projects. 

Officials in other states told us that commissions themselves, rather
than individual projects, should compete for federal grants. 
Officials in Maryland and Texas told us that the Corporation should
allocate federal AmeriCorps grants to states on the basis of
commissions' demonstrated ability to effectively manage quality
national service projects in their states.  They argued that the
Corporation should treat different states differently, taking into
account states' unique service needs.  Neither Maryland nor Texas
officials, however, had developed a set of suggested criteria for the
Corporation to use to make such determinations. 

Senior Corporation officials told us that they are not certain the
competitive process used, in part, to allocate funds to state
commissions achieves the quality control over project selection that
was originally anticipated.  They oppose, however, allocating all
available funding to state commissions based simply on population
demographics.  Corporation officials stated that such a method does
not take into account the differing abilities of state commissions to
administer and oversee AmeriCorps projects, noting that two states
have yet to even appoint state commissions.  In addition, these
officials believe that national direct projects play an important
role in the AmeriCorps program and should receive grants directly
from the Corporation.  While these officials told us that in the
future the Corporation may recommend that the Congress change the
act's grant allocation process, they had no specific proposals for
the Congress to consider at the time of our review. 


      COORDINATION WITH NATIONAL
      DIRECT PROJECTS
---------------------------------------------------------- Letter :6.3

Some state commission officials we visited told us that giving states
more control over the AmeriCorps program would eliminate or alleviate
current problems they have coordinating with AmeriCorps projects
operating in their state.  Historically, national direct projects
were not required to coordinate with state commission officials,
which some commission officials cited as a point of frustration. 
These officials told us that the public holds them culpable for the
actions of national direct AmeriCorps projects because the public
does not distinguish between national direct projects and
state-administered projects.  In addition, some state commission
officials said they doubt that out-of-state nonprofits fully
understand the needs of local communities in their states. 

Corporation officials acknowledged the difficulties that some states
have experienced coordinating with national direct projects.  To
ameliorate this problem, an official said that as of January 1997,
the Corporation requires national direct grantees to coordinate with
the relevant state commission officials.  In addition, in the future,
state commissions can provide comments on the Corporation's national
direct grant selections, which these Corporation officials believe
will also help eliminate this coordination problem. 

Corporation officials told us, however, that national direct grants
play an essential program role.  They argued that community service
is central to the mission of many national nonprofit organizations
and that these organizations are, by and large, the recipients of
such grants.  Specifically, these officials believe that national
direct grants help (1) attract national nonprofit organizations to
the AmeriCorps program, (2) achieve a more efficient and less
bureaucratic method of administering projects that operate in several
states, and (3) recruit nonprofit organizations with the economies of
scale that could allow the Corporation to dramatically decrease its
per-participant costs by funding only the portion of projects'
expenses associated with providing participants their education
awards. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :7

In commenting on our report, the Corporation stated that in
calculating attrition rates, we should not have included participants
who leave projects early to take advantage of opportunities for
educational or professional advancement because such departures do
not reflect on program quality.  We did not, however, use attrition
rates or any other output as a project quality index and, therefore,
did not modify our calculations.  Although the Corporation believes
that the term "outputs" should characterize only project
accomplishments, we use the term to characterize participant
enrollment, project attrition, education award usage, and project
expenditures--a use of the term that is consistent with long-standing
conventions of social science research. 

The Corporation also stated that a complete analysis of education
award usage may not be available for several years because
participants have up to 7 years to use their awards.  Our education
award calculation represents a snapshot in time, and our report
describes the 7-year interval.  The Corporation suggested other
changes that were primarily technical and editorial in nature.  We
revised the report as appropriate, defining our use of the terms
"project" and "program," for instance, and clarifying that we used
the most current and appropriate data available for our analysis. 


---------------------------------------------------------- Letter :7.1

We are sending copies of this report to the appropriate House and
Senate committees and other interested parties.  We will also make
copies available to others on request. 

If you have any questions about this report, please call me at (202)
512-7014 or Jeff Appel, senior evaluator, at (617) 565-7513.  This
report was prepared under the direction of Wayne B.  Upshaw,
Assistant Director.  Ben Jordan, evaluator, also contributed to this
report. 

Cornelia M.  Blanchette
Associate Director, Education
 and Employment Issues


DESCRIPTION OF 24 SELECTED
AMERICORPS PROJECTS, BY STATE
=========================================================== Appendix I

Project                    Participant activities
-------------------------  -----------------------------------------------------
California
--------------------------------------------------------------------------------
Bay Area Youth Agency      Participants work to meet the needs of at-risk youth
Consortium AmeriCorps      through peer counseling, health education/outreach,
Project                    gang intervention, conflict resolution, alcohol/drug
                           counseling and education, outreach to homeless youth,
                           after-school recreation, tutoring, and child care.

Building Up Los Angeles    Participants serve in a citywide partnership to
                           develop neighborhood-based service projects. Members
                           mentor/tutor community youth, provide training in
                           conflict management skills, and engage individuals in
                           physical improvement projects.

California Conservation    Participants serve in teams to plan and perform
Corps AmeriCorps           activities, including rural and urban environmental
                           projects, trail construction and maintenance, tree
                           planting, city infrastructure maintenance, and
                           organizing city youth activities.

East Bay Conservation      Participants tutor and counsel at-risk youth, develop
Corps AmeriCorps           and operate after-school programs, deliver basic
Collaborative              health care services, and implement physical
                           improvement projects through a 19-organization
                           partnership.


Maryland
--------------------------------------------------------------------------------
Appalachian Service        Participants provide independent living assistance
Through Action and         and health care to homebound elderly individuals,
Resources                  enlarge area food pantries, create youth literacy
                           programs, and develop educational programs for Head
                           Start students in Appalachian Maryland.

Maryland Students Taking   Participants tutor low-income students, in a tri-
Responsibility for         county area, using a cascading leadership model.
Tomorrow                   Participants supervise high school students who, in
                           turn, act as mentors and tutors for middle and
                           elementary school students.

United Youth Corps of      Participants work in rural, urban, and suburban areas
Maryland                   of the state through a collaboration among the
                           Maryland Conservation Corps, Civic Works, and
                           Community Year. Participants work to stabilize soil
                           erosion, build community gardens, and rehabilitate
                           homes for low-income families.

Enhancing Neighborhood     Participants conduct home visits to the chronically
Action by Local            ill and provide health service referrals.
Empowerment                Participants also tutor first-grade students, develop
                           structured after-school intergenerational activities,
                           and teach school readiness skills to preschool
                           children.


Missouri
--------------------------------------------------------------------------------
Grace Hill AmeriCorps      Participants help conserve the Mississippi Riverfront
RiverFront Trail Project   by restoring and beautifying trails. Participants
                           work to increase the educational success of urban
                           youth by organizing outdoor recreational and
                           educational activities and by planning weekly summer
                           educational events.

Come as You Are Project    Participants serve the St. Joseph area by developing
                           academic laboratories in schools, organizing and
                           conducting neighborhood cleanup projects and
                           recycling programs, and working with children to
                           establish community gardens that provide food to
                           local food pantries.

Southeast Missouri         Participants work to reduce violence against children
Partnership for Community  by recruiting tutors and mentors to work with high-
Service                    risk youth, developing a literacy program for
                           parents, developing after-school and summer programs,
                           and working with juvenile authorities to develop
                           service projects for youthful offenders.

St. Louis Partners for     Participants work to increase the capacity of schools
Service                    to improve the achievement of fourth-through eighth-
                           graders in low-income communities and identify and
                           train volunteers to develop service projects in
                           literacy, the environment, first aid and personal
                           safety, and substance abuse prevention.

Rhode Island

Leadership, Education and  Participants provide a range of services for at-risk
Service Enterprise         students of all ages, including preschool assistance,
                           tutoring for school-aged youth and adults, and
                           referral services.

City Year, Rhode Island    Participants serve in teams to strengthen communities
                           by tapping the resources of local residents,
                           business, and nonprofit organizations. Participants
                           provide services such as mentoring/tutoring students
                           from kindergarten through seventh grade and
                           participating in community gardening, low-income
                           housing, and after-school programming.


Texas
--------------------------------------------------------------------------------
Casa Verde Builders        Participants work to improve low-income areas by
Program                    building energy-efficient homes using least toxic
                           materials and alternative building methods.
                           Participants also renovate and weatherize existing
                           homes to save on energy costs.

Making Connections for     Participants serve children living in poverty by
Children and Youth         offering nutritious food and enrichment activities at
                           summer food sites, tutoring and mentoring at schools,
                           providing violence prevention/conflict resolution
                           activities, and facilitating access to health care.

Parenting Education        Participants provide parenting education services at
Project                    schools and community nonprofit organizations.
                           Participants conduct home visits, community outreach
                           and recruitment, teen parent mentoring, and
                           developmental screening, and provide child care for
                           teen parent students.

Serve Houston Youth Corps  Participants operate after-school service-learning
                           programs in elementary schools. Participants work in
                           teams with other youth from varied backgrounds to
                           strengthen the community in areas including the
                           environment, hunger and homelessness reduction, and
                           public safety.


Virginia
--------------------------------------------------------------------------------
Service to Alexandria      Participants work to rehabilitate, revitalize, and
                           maintain public housing units in their own
                           communities.

Virginia Commonwealth      Participants serve as outreach workers for community-
University AmeriCorps      based organizations that provide tutoring/mentoring,
                           parenting skill workshops, physical exams and
                           immunizations, conflict resolution training, and
                           prenatal health education.


Washington
--------------------------------------------------------------------------------
AmeriCorps Youth in        Participants teach conflict resolution skills,
Service                    provide tutoring and frontline gang intervention, and
                           implement after-school, late night, and summer
                           recreation programs for rural and Native American
                           youth. Participants also provide independent living
                           support to mentally ill adults.

Spokane Service Team       Participants rehabilitate low-income housing units
                           and construct new housing for emergency and
                           transitional living. Participants also work to
                           restore habitats for native plants, vegetation, and
                           wildlife. They are also involved in developing
                           recreational areas in state parks and improving
                           hiking and biking trails.

Educational Conservation   Participants work to improve water quality and
Corps                      restore a reduced salmon population by rehabilitating
                           damaged watersheds and building fences to prevent
                           erosion.

Washington AmeriCorps      Participants serve in various agencies across the
                           state on a wide range of projects, including
                           developing a statewide literacy initiative for recent
                           immigrants, providing at-risk youth with service
                           alternatives to gang activity, and concentrating
                           services to a needy, isolated Native American
                           reservation.
--------------------------------------------------------------------------------

DETAILED INFORMATION ON PROJECT
ENROLLMENT, ATTRITION, AND
EDUCATION AWARD USAGE FOR THE
1994-95 PROGRAM YEAR
========================================================== Appendix II

                                                                                       Participants who ended
                                                             Participants who ended    service early for all
                                                            service early for cause           reasons                   Education award usage
                                                            ------------------------  ------------------------  -------------------------------------
                                                                                         Released
                                                     Total     Released   Percentage      for all   Percentage    Earned an                Percentage
Project                                           enrolled    for cause  of enrolled      reasons  of enrolled        award   Used award         used
------------------------------------------------  --------  -----------  -----------  -----------  -----------  -----------  -----------  -----------
Bay Area Youth Agency Consortium AmeriCorps             60           10           17           13           22           50           20           40
 Project
Building Up Los Angeles                                125           26           21           43           34           87           29           33
Califoria Conservation Corps AmeriCorps                135           14           10           43           32          115           29           25
East Bay Conservation Corps AmeriCorps                 169           47           28           76           45          118           64           54
 Collaborative
Appalachian Service Through Action and Resources        32            8           25            9           28           22           13           59
United Youth Corps of Maryland                         128           45           35           50           39           66           35           53
Enhancing Neighborhood Action by Local                  24            5           21           10           42           19           10           53
 Empowerment
Maryland Students Taking Responsibility for             33            1            3            3            9           12            9           75
 Tomorrow
St. Louis Partners for Service                          31            3           10            7           23           28           19           68
Grace Hill AmeriCorps RiverFront Trail Project          38           13           34           15           39           22            5           23
Southeast Missouri Partnership for Community            41           20           49           23           56           21           15           71
 Service
Come as You Are Project                                 40           12           30           21           53           28           16           57
Leadership, Education and Service Enterprise            25            8           32           10           40           17           10           59
City Year, Rhode Island                                 85           17           20           17           20           47           26           55
Casa Verde Builders Program                             64           37           58           38           59           23            4           17
Making Connections for Children and Youth               50           14           28           21           42           35           19           54
Serve Houston Youth Corps                               64            8           13           18           28           56           33           59
Parenting Education Project                             61           10           16           21           34           50           18           36
Virgina Commonwealth University AmeriCorps              37           16           43           17           46           21           13           62
Service to Alexandria                                   21            3           14           20           95           17            3           18
AmeriCorps Youth in Service                             43            7           16            9           21           36           28           78
Spokane Service Team                                    33            4           12           19           58           28            7           25
Washington AmeriCorps                                  350           80           23           94           27          254          137           54
Educational Conservation Corps                          97           37           38           41           42           58           20           34
-----------------------------------------------------------------------------------------------------------------------------------------------------

24 AMERICORPS PROJECT EXPENDITURES
FOR THE 1994-95 PROGRAM YEAR, BY
RESOURCE STREAM
========================================================= Appendix III

                                                                  Other federal                     State                Local government           Private Sector
                                                         --------------------------------  ------------------------  ------------------------  ------------------------
Project                                     Corporation            Cash           In-kind         Cash      In-kind         Cash      In-kind         Cash      In-kind        Total
---------------------------------------  --------------  --------------  ----------------  -----------  -----------  -----------  -----------  -----------  -----------  -----------
Bay Area Youth Agency Consortium               $756,587              $0                $0           $0           $0           $0           $0     $257,921     $145,040   $1,159,548
 AmeriCorps Project
Building Up Los Angeles                       1,415,016               0                 0            0            0            0            0      199,877      203,090    1,817,983
California Conservation Corps                   637,595         293,641           500,000      563,584      122,986       69,580      311,387       23,361        8,650    2,530,784
 AmeriCorps
East Bay Conservation Corps AmeriCorps        2,020,649               0             8,500       13,299       28,164      142,488      239,681      190,326      102,567    2,745,674
 Collaborative
Appalachian Service Through Action and          341,935               0                 0       23,894      235,075       31,336            0            0            0      632,240
 Resources
United Youth Corps of Maryland                1,767,517               0                 0            0       37,712       75,263       14,300      351,309       23,148    2,269,249
Enhancing Neighborhood Action by Local          222,605               0                 0      152,535       11,500            0            0       78,568            0      465,208
 Empowerment
Maryland Students Taking Responsibility         262,672           5,681                 0            0            0            0            0            0       92,548      360,901
 for Tomorrow
St. Louis Partners for Service                  368,812               0                 0            0            0            0            0       68,895      168,604      606,311
Grace Hill AmeriCorps RiverFront Trail          270,114               0                 0            0            0            0            0      114,731       47,920      432,765
 Project
Southeast Missouri Partnership for              308,093               0                 0       11,464       46,517       11,050       36,997          226        3,718      418,065
 Community Service
Come as You Are Project                         218,659               0                 0            0            0            0            0       20,974       43,867      283,499
City Year, Rhode Island                         826,835               0                 0            0            0            0            0      270,163      144,142    1,241,140
Leadership, Education and Service               251,495               0            16,812            0            0            0       29,518       35,736            0      333,561
 Enterprise
Casa Verde Builders Program                     975,009         799,635                 0            0            0      469,819            0      143,590       60,000    2,448,053
Serve Houston Youth Corps                       937,315          40,325                 0            0            0            0            0      205,768       95,070    1,278,478
Parenting Education Project                     759,110               0                 0       51,366       45,714       78,540       11,636       93,083       23,271    1,062,720
Making Connections for Children and             445,646          24,985                 0            0            0            0            0      112,816            0      583,447
 Youth
Service to Alexandria                           269,860               0                 0            0            0       69,117       80,000            0            0      418,977
Virginia Commonwealth University                154,287               0                 0       24,496       27,067            0            0            0            0      205,850
 AmeriCorps
Educational Conservation Corps                        0         626,639                 0      953,592            0      152,261            0            0            0    1,732,492
AmeriCorps Youth in Service                     304,233               0                 0            0            0            0            0       57,646      259,330      621,209
Spokane Service Team                            254,319               0                 0      103,448       34,000       23,465            0       94,226       25,770      535,227
Washington AmeriCorps                         2,399,965               0            54,241      683,281       75,314            0      512,041            0      208,597    3,933,438
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

*** End of document. ***