COMMITTEE ON WAYS AND MEANS BILL THOMAS, California, Chairman
PHILIP M. CRANE, Illinois E. CLAY SHAW, Jr., Florida NANCY L. JOHNSON, Connecticut AMO HOUGHTON, New York WALLY HERGER, California JIM MCCRERY, Louisiana DAVE CAMP, Michigan JIM RAMSTAD, Minnesota JIM NUSSLE, Iowa SAM JOHNSON, Texas JENNIFER DUNN, Washington MAC COLLINS, Georgia ROB PORTMAN, Ohio PHIL ENGLISH, Pennsylvania WES WATKINS, Oklahoma J. D. HAYWORTH, Arizona JERRY WELLER, Illinois KENNY C. HULSHOF, Missouri SCOTT MCINNIS, Colorado RON LEWIS, Kentucky MARK FOLEY, Florida KEVIN BRADY, Texas PAUL RYAN, Wisconsin	CHARLES B. RANGEL, New York FORTNEY PETE STARK, California ROBERT T. MATSUI, California WILLIAM J. COYNE, Pennsylvania SANDER M. LEVIN, Michigan BENJAMIN L. CARDIN, Maryland JIM MCDERMOTT, Washington GERALD D. KLECZKA, Wisconsin JOHN LEWIS, Georgia RICHARD E. NEAL, Massachusetts MICHAEL R. MCNULTY, New York WILLIAM J. JEFFERSON, Louisiana JOHN S. TANNER, Tennessee XAVIER BECERRA, California KAREN L. THURMAN, Florida LLOYD DOGGETT, Texas EARL POMEROY, North Dakota
Allison Giles, Chief of Staff Janice Mays, Minority Chief Counsel  SUBCOMMITTEE ON HUMAN RESOURCES WALLY HERGER, California, Chairman
NANCY L. JOHNSON, Connecticut WES WATKINS, Oklahoma SCOTT MCINNIS, Colorado JIM MCCRERY, Louisiana DAVE CAMP, Michigan PHIL ENGLISH, Pennsylvania RON LEWIS, Kentucky	BENJAMIN L. CARDIN, Maryland FORTNEY PETE STARK, California SANDER M. LEVIN, Michigan JIM MCDERMOTT, Washington LLOYD DOGGETT, Texas
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Ways and Means are also published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined.

Chairman HERGER. Good morning, and welcome to today's hearing on President Bush's fiscal year 2002 human resources budget proposals. The President has made a number of proposals that fall under the jurisdiction of this Subcommittee and which would be administered by the U.S. Department of Health and Human Services (HHS). These include programs that promote responsible fatherhood, to better protect children at risk of abuse and neglect, and to mentor children of prisoners, to name a few.

Today's hearing will help us learn more about the President's proposals and how we can work with the administration to better protect children and assist young families on the path to self-support.

I want to highlight one proposal, mentoring children of prisoners. In our country today, one and a half million children have a parent who is incarcerated. Studies show these children are more likely to be arrested or incarcerated themselves, to drop out of school, to run with gangs and to abuse drugs. To his credit, the President has proposed new funding for programs that link such children with positive adult role models, while their own parent is in jail. The programs also help children maintain contact with an imprisoned parent so that when the parent leaves prison, he or she can better reconnect with the child.

Given the number of children affected and the likelihood this sad cycle will repeat itself if nothing is done, I hope we can all agree to support the President's proposal. The President issued a budget blueprint, sketching out this and his other proposals in February, which means this hearing has been in the planning stages for some time. For several months, we have been waiting for the Senate to act on a nomination of Dr. Wade Horn to be Assistant Secretary for the Office of Family Support at HHS. However, his nomination is one of a number held up in the Senate, and we must press on with our business.

Fortunately, we have an excellent pinch hitter in Acting Assistant Secretary for Management and Budget, Dennis Williams. Mr. Williams has worked on these issues at HHS since 1984. We are pleased he can share with us his lengthy experience and perspective. We welcome him to the Subcommittee and look forward to his testimony.

Without objection, each member will have the opportunity to submit a written statement and have it included in the record at this point.

Mr. Cardin, would you like to make an opening statement?

[The opening statement of Chairman Herger follows:]

Mr. CARDIN. Well, thank you, Mr. Chairman. I very much appreciate you calling this hearing so that we can have a record on the Bush administration's budget on areas that are within the jurisdiction of this Committee, and I want to welcome Dennis Williams to our Committee and we look forward to having the full range of cabinet-level officials before our Committee to look at these initiatives.

Mr.  Chairman, I might say they think there is some good news in the President's initiatives. I think there are some areas that we need to improve upon, and there are some matters of concern. So let me just touch upon a few very briefly.

First on the Safe and Stable Families Program, we are very pleased that the Bush administration has put more resources into that program, and we would like to see that moved as quickly as we possibly can. Those funds are used to help children at risk, and I think there is strong support for moving forward in that area. Mr. Chairman, we would hope that we could improve upon this recommendation by adding one of the major causes, substance abuse, into those funding areas that are eligible for this program.

Secondly, Mr. Chairman, on the Independent Living Program, I am very pleased that the administration has put more resources into that program. It is more consistent with the work of this Subcommittee in our efforts to help children who age out of foster care, and it is a welcome addition to see more resources put into that program.

Third, let me mention the Responsible Fatherhood Initiative that the administration has put forward. That looks very similar to the legislation that was authored by Congresswoman Johnson and myself and enjoyed very strong bipartisan support in the House, and I would hope that we could move forward in that area.

Now, Mr. Chairman, let me just mention a couple areas that we have concern and where we think that we need to make improvements. First, we were disappointed that the administration has not put forward a recommendation on the Child Support Distribution System. There has been tremendous interest among the child support enforcement local officials that we reform that system to make it easier for them to administer the program and to allow States to pay us through more child support to the families. That would help in the Fatherhood Initiative, and Mrs. Johnson and I again have worked in that area last Congress and there is strong bipartisan support to move that initiative.

In the area of Temporary Assistance for Needy Families (TANF), we are concerned that the administration has not come forward with extending the supplemental grant program that affects a large number of States. It does not affect the State of Maryland that I have the honor of representing, but it is an area that we should move forward and we are disappointed that the administration has not come forward with any initiative in that area.

And let me just mention another area that has not gotten much attention here on the Hill and maybe it has been withdrawn, but the administration's budget also includes the ability of States to offset local tax breaks to faith-based institutions through the use of TANF funds, and that is one that I would hope would not move forward in this Congress.

And then lastly, let me mention the faith-based initiatives that our full Committee will be taking up later today. There has been a lot of discussion about the faith-based initiatives, but today we are going to be talking about budget initiatives, and one area that I think all the faith-based groups that currently enjoy significant resources from the Federal Government to help in their mission would agree, and that is we should be putting more money, not less, into those programs in which faith-based institutions today are able to access Federal funds. Title XX is a good example of that, and yet that program is still under funded and the administration has not come forward with initiatives in that area.

And then I would lastly mention the CCDBG Program and the fact that the administration has come forward with some new money in that area in the Child Care and Development Block Grant Program, but they come forward with some new initiatives to take some money out of that program which we think is counterproductive, so that we would hope that if we want to work out a bipartisan agreement on the faith-based initiatives, that we would talk about putting more money into the pot so that the community can address these problems more adequately rather than just putting more spoons in the bowl that is already inadequate as far as the resources that are available.

We look forward to hearing Mr. Williams, and we look forward to working with you on these initiatives.

[The opening statement of Mr. Cardin follows:]

Chairman HERGER. Thank you, Mr. Cardin. Before we move on to our testimony this morning, I want to remind our witness to limit his oral statements to 5 minutes. However, without objection, all the written testimony will be made a part of the permanent record. Now we will turn to our witness, Mr. Dennis Williams, Acting Assistant Secretary for Management and Budget at the U.S. Department of Health and Human Services. Mr. Williams.

STATEMENT OF DENNIS P. WILLIAMS, ACTING ASSISTANT SECRETARY FOR MANAGEMENT AND BUDGET, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

Mr. WILLIAMS. Thank you, Mr. Chairman, members of the Committee. I am pleased to appear before you today to discuss the President's fiscal year 2002 budget request for the Administration for Children and Families. ACF is the Department's leading agency responsible for serving our Nation's most vulnerable populations, including preschool age children, adolescents, and families and children in crisis. The fiscal year 2002 budget for the Administration for Children and Families is $44.4 billion. The request represents an increase of 2.9 percent above the fiscal year 2001 enacted level and is comprised of $31.8 billion in funding for entitlement programs, including the Temporary Assistance for Needy Families Program, Child Support Enforcement, Foster Care and Adoption Assistance and the Child Care Entitlement, and $12.6 billion for funding discretionary programs, such as Head Start.

The agency's fiscal year 2002 budget reflects the administration's commitment to improving the lives of our Nation's most vulnerable children and families by maintaining critical investments and targeting new initiatives to help them thrive and prosper. The budget also increases support for charitable organizations that can make such a difference in people's lives. I would like to spend my time today discussing these new initiatives.

First, ACF's budget seeks to strengthen families by recognizing the critical role that fathers play in the lives of their families. A new $64 million program is proposed to provide competitive grants to religious and community organizations to help parents support their children financially and improve parenting skills and to promote marriage. We commend the Subcommittee for its leadership on this issue and look forward to working with you in this area of mutual commitment.

In addition, ACF's budget seeks funding under the Social Security Act's section 1110 demonstration authority for a Compassion Capital Fund. The fund would provide start-up capital and operating funds totaling $89 million in 2002 to support qualified charitable organizations that wish to expand or emulate model social programs and to promote research on best practices among charitable organizations.

Further, to encourage States to create State tax credits for contributions to designated charities, this budget proposes to allow States to use Federal Temporary Assistance for Needy Families funds to offset revenue losses from such contributions.

In the area of child care, the fiscal year 2002 request proposes to increase discretionary funds available for the Child Care and Development Block Grant by $200 million for a total fiscal year 2002 level of $2.2 billion.

The President's budget includes a $400 million set-aside to provide parents with certificates to obtain after-school child care with a high quality education focus for eligible children up to 19 years of age. This would help low-income working parents pay for the cost of care to children especially vulnerable to crime and at-risk behavior when left unsupervised after school.

Additionally, the 2002 budget includes a $150 million increase in pre-appropriated entitlement funds. In total, this translates to a $350 million increase in child care funding, which will provide after-school care for up to 500,000 additional children.

In addition, ACF's budget seeks to help our most vulnerable and at-risk children live safe and productive lives in conjunction with reauthorization of the Promoting Safe and Stable Families Program, which is scheduled to expire on September 30th, 2001.

We are proposing a $200 million increase for the Promoting Safe and Stable Families Program, which supports State and tribal child welfare agencies in carrying out family preservation, family support, family reunification and adoption promotion and assistance services.

Within this framework, we are also proposing to create a new discretionary initiative that will provide $67 million within the Promoting Safe and Stable Families Program to assist children of prisoners. On an average day, as Mr. Herger has pointed out, America is home to 1.5 million children of prisoners who suffer disproportionate rates of many severe social problems, including substance abuse, gang involvement, early child bearing and delinquency. This additional new funding would go to States to provide a range of activities, including family rebuilding programs that serve low-income children of prisoners and probationers.

Finally, we are also seeking a $60 million increase in funding for the Independent Living Program within the Foster Care and Adoption Assistance Entitlement. This funding is intended to provide vouchers worth up to $5,000 for education and training to help young people who age out of foster care develop skills to lead independent and productive lives. Currently 16,000 youth age out of the foster care system annually and often do not have the resources to pay for higher education and vocational training that can be critical to increasing their opportunity to secure work and become contributing members of adult society.

As outlined in my written testimony, ACF's fiscal year 2002 budget includes several additional funding priorities, including $33 million for maternity group homes to provide safe and nurturing environments for teenage mothers and their children who cannot live with their own families because of abuse, neglect or other extenuating circumstances.

Along with the priorities I have just highlighted, the fiscal year 2002 budget for ACF supports crucial areas of need for our Nation's children and families. We look forward to working with you to ensure these needs are addressed. Thank you, Mr. Chairman. I will be happy to answer any questions you or the Committee may have at this time.

[The prepared statement of Mr. Williams follows:]

Chairman HERGER. Thank you, Mr.  Williams, and now we will turn to questions for Mr. Williams, and I would like to remind the members that they each have 5 minutes for witness questioning. I recognize the gentlelady from Connecticut, Mrs. Johnson, to inquire.

Mrs. JOHNSON. I thank the chairman and I thank Mr. Williams for appearing before our Subcommittee today. I want to make just a couple of comments that I hope you will kind of take back as my first reactions to where we are and then I will proceed with the question.

But first of all, I am very pleased to see this new administration focusing on fatherhood. I would call your attention to the structure of the bill that Mr. Cardin and I wrote that involves preferences. There are some problems that we don't know how to solve, but we need to stimulate and incentivize the States to solve them. One of the biggest is how do we help young men who are terribly in debt from nonsupport payments, from not having paid child support, out from under that debt? In Hartford, there are at least 400 men who will never, ever be able to work in the public economy. They will never be part of Social Security. They will never be a part of Medicare, and they will never be a stable part of their families, not because they don't want to and not because they aren't actually working under the table, but because they have such large arrearages that they could never, ever pay off $10,000, $20,000, $30,000.

So we need States to look at this creatively. We do this in many other areas. We let teachers pay off debt by serving in low income areas. I mean, there are lots of things we can do, but we have done none of it and so we don't tell States how to deal with arrearages. But I can tell you many of the men that we most want to reach cannot be reached until we also work with them financially. We didn't. That is why they have these big debts.

Now that we have a system that identifies paternity at birth, gets them in the system early, we should avoid these problems in the future, but we will never solve the problems of our young families if we aren't more honest about debt and its influence on our lives.

So I just point that out to you and any work the Department is doing on those kinds of creative things or knows the States are doing I think we would be real interested in.

Then secondly, I hope you will look more carefully at and I hope we will have a chance to look at the Safe and Stable Families Program from the point of view of the waivers that have been given to States to better integrate their foster care and adoption money, because that control over those dollars so that they aren't driven by placement decisions but rather by child need decisions is a very important movement, and now there are a lot of States that have gotten waivers and more flexible use of that money, and we need to look at that because as we reauthorize these things, we really have to be more progressive on future looking.

On the maternity group home thing, I am really concerned about that, because we have got to do a far better job among pregnancy prevention among teenagers, and I have a program in my district that gets not one dollar of abstinence money though it has a 100 percent success rate now over a number of years, not one pregnancy, male or female. This isn't just about girls getting pregnant. This is about young boys impregnating girls. But because they teach about contraceptives, even though they teach heavily about abstinence and it is abstinence that is really serving them, they don't get a dollar of Federal money. So I think we need to look more realistically.

There was a very big article about this recently that quotes kids just  about the security. They need to know that they have got that backup and if they make a mistake and -- we don't have the time to go into it here, but we have got to be more honest with our kids, because we can help them prevent pregnancy and go on and get the education they need to be a productive member of society. And I would be very reluctant, frankly, to put new money into maternity homes when we are doing so little to prevent pregnancy.

I do also join my other colleagues in their interest in substance abuse treatment dollars, and that leads me to the one question of this series of things that we have laid out here. I do wonder how much we know about women in prison and parents in prison, parents of children on TANF in prison, and what their particular needs are, what percentage of parents are there because of substance abuse, because of so on and so forth, and what are we doing and how will some of the programs that you are proposing help in that.

Before I relinquish my time, let me also just say that I am very pleased with the increase in the child care dollars, but in my experience we have two few vouchers to support the number of people coming off welfare, so it is a problem to take voucher dollars, the after-school dollars, as important as after-school care is. So I just put those concerns out there, but I am very interested in the families in prison and particularly those in TANF.

Mr. WILLIAMS. Let me add more fully for the record on some of the statistics and characteristics of women and children that I think could give you a fuller response, but we can say that women in prison and the children of women in prison are particularly vulnerable in society. These children typically come from households where the mother was a sole provider, making placements in foster care more likely when the mother is in prison than if she is not. So this is an area where we have particular interest and concern.

There are no government programs now that really address this problem. There are some private programs, such as Big Brother, Big Sister, but this is an area where the government and a government program can, we think, have particularly high payoff. In a more general way, the limited data indicates that placements in foster care as a result of a parent's incarceration increased from 2.5 percent of the placements in 1997 to 5.9 percent in 1999, and that represents roughly 30,000 children. So this is a matter of some size and dimension.

I might just comment briefly, if you have a moment, on some of your other comments. Your comments with respect to strengthening fatherhood are timely. The administration is now giving high priority to the drafting of that legislation, and we will take your concerns and your interests into account. When we have the legislation we certainly look forward to working with the Committee to try to produce a bill which addresses this problem.

[The following was subsequently received:]

In 1999 State and Federal prisons held an estimated 721,500 parents of minor children. A majority of State (55%) and Federal (63%) prisoners report having a child under the age of 18. Forty-six percent of the parents reported living with their children prior to admission. As a result, there were an estimated 336,300 U.S. households with minor children affected by the imprisonment of a parent.

While a majority of both fathers (57%) and mothers (54%) in State prison reported never having a personnel visit with their children since admission, 40% of fathers and 60% of mothers in State prison reported weekly contact with their children.

Children of prisoners are less likely than their peers to succeed in school and more likely to succumb to substance abuse, gangs, early childbearing and delinquency. Children of incarcerated mothers are particularly vulnerable; as these children typically come from households where the mother was the sole provider, making placement in foster care more likely when the mother is in prison. The data available indicates that placement in foster care as a result of a parent's incarceration increased from 2.5% of the placements in 1997 to 5.9% (roughly 30,000 children) in 1999.

Chairman HERGER. Thank you. The time has expired of the gentlelady from Connecticut. Now I recognize our ranking member, Mr. Cardin, to inquire.

Mr. CARDIN. Thank you, Mr. Chairman. Mr. Williams, HHS, of course, is the agency that is primarily responsible for our people who are most at risk. As I look at the budget priorities of the Bush administration, clearly they have come forward now with an initiative for defense. They have had their tax initiative. When I look at the increase that you refer to in your statement of 2.9 percent in this area, the Consumer Price Index rose 3.6 percent for the 12 months ending this May, and with two more million people in our country this year, it seems to me we are not keeping up with inflation. We are not keeping up with the needs in this area for our most vulnerable, so I appreciate the fact that you have gone over some of the new initiatives. I wonder how you square the overall resources that are going to be available with the needs that are out there.

Mr. WILLIAMS. Mr. Cardin, thank you. The President has produced a budget which has very much focused on trying to restrain the growth in spending, not eliminate it, but to restrain it to a level of spending over the long term which is sustainable. Within that objective, however, the President and the Secretary have focused their attention on some clear priorities.

Mr. CARDIN. I just interrupt for one moment to say that 2.9 in this area is significantly lower than the overall number of the other areas in the budget. So it appears to me  again, as an advocate for human resources, which is what this Subcommittee is concerned about, and HHS, which is your agency's mission, it seems like this is the area that got shortchanged.

Mr. WILLIAMS. We have focused our attention on some clear priorities. Some of the new programs I have mentioned are new initiatives. They will amount to $456 million in new spending in 2002. Some of the areas that Mrs.  Johnson mentioned are areas that we want to address, child care and development. For child care, we have an increase of $200 million in the discretionary program. We have a $150 million increase in the mandatory program. On the discretionary side of this budget, that is a 10 percent increase. So we have in selected areas, admittedly selected areas, significant increases in resources that are of priority to the President and the Secretary.

Mr. CARDIN. I appreciate that response. I don't think it fully answers the question. Let me go on to one area, the Fatherhood Initiative is one in which there has been strong bipartisan support, has passed this House several times. Part of what we do is allow -- one of our initiatives with child support is allow pass-through child support to the families, which we think also helps bring the father into the family. Secretary Thompson, when he was Governor of Wisconsin, initiated that policy for his own State. The administration has come out with tax relief, and that has been enacted into law, and yet these families are paying effectively a marginal tax rate of 100 percent. Is the administration going to offer some initiative to help States who want to pass through child supports to the families to bring the families together?

Mr. WILLIAMS. It is my understanding, at least in the context of the strengthening fatherhood proposal, we have not made specific proposals there, although that legislation is still being drafted, so it is something we can consider, as Mrs. Johnson asked us to do. The budget does not envision any particular change in child support.

Mr. CARDIN. I would just ask you to take back that message. Again, we have bipartisan support here, and it helps the vulnerable families who have very high marginal rates, 100 percent.

Do you know how much resources currently go to faith-based, religious-affiliated organizations under the current Federal programs? Do you have that number?

Mr. WILLIAMS. I don't think so, but we could try to provide that for the record.

[The following was subsequently received:]

On January 29^th the President issued two Executive Orders (E.O.s) creating the White House Office of Faith Based and Community Initiatives and establishing Executive Department Centers for Faith-Based and Community Initiatives within the Departments of Education, Labor, Justice, Health and Human Services and Housing and Urban Development. One of the initial tasks of the Executive Department Centers is to conduct department-wide audits to identify all existing barriers to the participation of faith-based and community organizations in the delivery of social services by the department.

According to information collected for a section of the report about the current level of participation by faith-based and community-based organizations in Federal programs, overall figures were difficult to determine due to lack of available information. Grantees do not necessarily report their affiliation in a manner that allows the departments to identify whether or not they are faith-based. In addition, many programs provide funding to States by formula allocation. For these programs, information on the recipients of funds at a sub-state level is not currently collected and would not be included as part of a grant record.

To illustrate, while the Department of Health and Human Services was able to provide information on funding for faith-based organizations for a number of smaller programs, information on larger block grant programs such as Temporary Assistance for Needy Families (TANF) or Community Services Block Grant, which provide funds under the auspices of charitable choice provisions, was not available. It is our understanding that the Departments of Education, Labor, Justice, and Housing and Urban Development are experiencing similar limitations in their ability to accurately represent resources provided to faith-based organizations.

Mr. CARDIN. Would you? I appreciate it if you would. We know that the Catholic Charities has estimated almost two-thirds of their operating income comes from Federal, State and local governments. The Salvation Army says that they receive about $300 million a year in government funding. I think it would be important for us to have that number. If you could make it available to the Committee, I would appreciate that.

The one area that really concerns me, and you mention it in your oral statement -- I thought maybe you had abandoned it. I guess that was just wishful thinking -- and that is using TANF funds to reimburse the States for the charitable breaks they give them on the tax returns. You know, this is not money that is going necessarily to low-income programs. Charitable deductions could be anything from our church, to our hospital, to a university, and you really think we should be taking money away from low-income programs to fund this initiative? It is totally inconsistent with everything we have said on TANF funding.

Mr. WILLIAMS. The proposal envisions that the ability to use TANF money to help to finance a tax credit would be for those programs which address poverty and other social problems in the State. So this is not meant to be --

Mr. CARDIN. I thought it was for tax cuts.

Mr. WILLIAMS. No. This is not meant to be an open-ended tax credit  but, rather, for charitable contributions for those areas that would address the issues you are talking about.

Mr. CARDIN. I am sorry I don't have Mr. Portman on this panel, because I think Mr. Portman would agree with me, that if you are going to limit it to the type of 501(c)(3)s that would qualify for this tax relief, you are just creating additional complexity and also an impossible burden on enforcement for a State to develop a separate tax break for certain types of charitable organizations.

Mr. WILLIAMS. But we do that with the objective of leveraging a lot more money for some of these programs. If we can provide some tax credits to individuals who are prepared to put private money -- more private money -- into these programs than overall, we should. The objective is to increase the amount of resources available for these programs.

Mr. CARDIN. But States can do that already with their TANF funds.

Mr. WILLIAMS. Yes, but --

Mr. CARDIN. Why develop another complexity into the system?

Chairman HERGER. I thank the gentleman from Maryland. We have been notified that there are expected to be two votes on the floor. We will go and vote and return as soon as possible. In the meantime, the hearing stands in recess.

[Recess.]

Chairman HERGER. This Committee is reconvened, and, again, good to see you, Mr. Williams. On the fatherhood legislation proposed by the administration, this Committee approved fatherhood legislation last year that also passed the House by a wide margin. Nancy Johnson and Ben Cardin have reintroduced that legislation this year, and we recently held a hearing that included discussion of their bill, H.R. 1471. Could you please tell us how the President's proposals on fatherhood differ, if at all, from the approach in the Johnson-Cardin bill?

Mr. WILLIAMS. Thank you, Mr. Chairman. I can't answer that question with absolute definition, because the administration's bill is still being drafted, and we hope to have it up here soon. It is my understanding, though, that the primary and basic purposes of the fatherhood title in the Cardin-Johnson bill and the administration's bill are likely to be in many areas of agreement, and we look forward to working with the Committee when we actually have the final draft.

Chairman HERGER. I thank you, and then Mr. Cardin mentioned a concern about simply adding more spoons to the same sized bowl when it comes to the President's faith-based initiative. Is it true that the President's budget does call for more funds, I believe some $89 million, in this budget in the area of a Compassion Capital Fund; and, therefore, it is growing the bowl?

Mr. WILLIAMS. Yes.

Chairman HERGER. And would you like to comment?

Mr. WILLIAMS. Yes, sir. The budget does propose a Compassion Capital Fund, which is aimed at providing start-up capital for faith-based institutions to provide services in their communities. It is $89 million that we would be proposing in new spending in fiscal year 2002.

Chairman HERGER. Thank you. And with that, I yield time to the gentleman from Texas, Mr. Doggett, to inquire.

Mr. DOGGETT. Thank you so much, Mr. Chairman. Mr. Williams, as you are aware, 17 States received supplemental grants to TANF, where they have traditionally received low TANF grants because they have many people in poverty or expanding populations. Why is President Bush opposed to this supplemental TANF program?

Mr. WILLIAMS. The President has not said that he is opposed to the supplemental program.

Mr. DOGGETT. Well, he excluded it from his budget, didn't he?

Mr. WILLIAMS. The TANF legislation is up for reauthorization in --

Mr. DOGGETT. Well, it is not in the President's budget.

Mr. WILLIAMS. And --

Mr. DOGGETT. Is that correct?

Mr. WILLIAMS. It was the President's and the Secretary's intention to deal with this and other issues in the TANF legislation as they came up for reauthorization.

Mr. DOGGETT. It is omitted from the President's budget, isn't it?

Mr. WILLIAMS. Yes, because that particular aspect of the TANF legislation expires this coming year rather than in 2002, but we expect the President will be addressing the full TANF reauthorization in the next year's budget.

Mr. DOGGETT. Well, do you expect that he is going to support the supplemental TANF program even though he excluded it from his budget?

Mr. WILLIAMS. I can't answer that with definition. The President's budget is being worked on now, but I would expect that this would be addressed in that budget.

Mr. DOGGETT. Why is the President opposed to the Early Learning Opportunities Fund to fund improvements in child care quality and seek out innovative programs that might be replicated across the country?

Mr. WILLIAMS. Mr. Doggett, I would say that the President and the Secretary are not opposed to the fund. The President did make some choices, however, and chose to spend money in the Department of Education for an early reading program, and the President's budget has an increase of $75 million for that program in the Department of Education and --

Mr. DOGGETT. Well, my question is related to the Early Learning Opportunities Fund to upgrade the quality of child care. These other programs may have merit, too, but the President thought again so little of this initiative to improve the quality of child care, not just for poor children but for all children, that he excluded it from his budget, didn't he?

Mr. WILLIAMS. That particular program is not funded, but there is money and increased resources for programs with similar purposes.

Mr. DOGGETT. So in terms of putting dollars into that program, the President is opposed to the Early Learning Opportunities Fund?

Mr. WILLIAMS. He is not opposed to the fund. He just doesn't want to provide more resources for similar programs.

Mr. DOGGETT. Let me ask you, with reference to Mr. Cardin's inquiry on the Child Care and Development Block Grant, as I understand, you increase it by $200 million and then take $400 million out of it for a new After School Program?

Mr. WILLIAMS. If you look at child care broadly, which includes both --

Mr. DOGGETT. I want to look specifically at the Child Care and Development Block Grant --

Mr. WILLIAMS. In the Child Care and Development Block Grant, there is an increase of $200 million in total.

Mr. DOGGETT. And then you take $400 million out of it?

Mr. WILLIAMS. We are not taking $400 million out of it.

Mr. DOGGETT. Well, you are putting it into a program that --

Mr. WILLIAMS. We are earmarking $400 million for an After School Program.

Mr. DOGGETT. Right. So it no longer will be available, sir, for the purposes of the Child Care Development Block Grant under current law, will it?

Mr. WILLIAMS. If you take child care under the Child Care and Development Block Grant, plus the mandatory program where there is an increase of $150 million, we will be providing the same assistance to child care in 2002 as we do in 2001. In addition, we will serve 500,000 additional children in the After School Program.

Mr. DOGGETT. Well, I am delighted you will under your proposal, but you have cut the Child Care and Development and Block Grant Program for purposes of what we use it for now, which in my State can't cover the number of people that want to receive support on child care who are trying to get off welfare and into the workforce. You cut it by $200 million dollars, don't you?

Mr. WILLIAMS. We have compensated for that by increasing the mandatory program by $150 million.

Mr. DOGGETT. Thank you very much.

Mr. CARDIN. Would you yield for one moment? Following Mr. Doggett's point on the supplemental grants, I don't really follow your answer. If you don't put it in this year's budget, that means that those States that have received the supplemental grants in the past will go a year without TANF funds, isn't that correct?

Mr. WILLIAMS. Yes, if the Congress did not address the issue, that is correct.

Mr. CARDIN. So --

Mr. WILLIAMS. But I was asked whether the President supported  the supplemental program, and the answer is we do, but the  President wants to deal with all of these issues in the TANF reauthorization.

Mr. CARDIN. The answer to the question, if we want to do it, Congress has to act this year, this year, and the budget has to include it this year, and the administration is not recommending action this year. Therefore, Mr. Williams, I would submit that by doing that you are adversely affecting the 17 States that depend upon that. Maryland is not one of those States. This is Texas and some of the other States that are involved. But I don't think you can hide behind the banner that you will take it up next year. Next year we will have a TANF reauthorization bill, but we should at least have a one-year extension if you want to defer it to next year and summit a one-year extension of the supplemental grants so that these States aren't adversely affected.

Mr. DOGGETT. If the gentleman would yield back, just like the Early Opportunity Learning Fund to upgrade the quality of child care, they are for it. They just don't want to pay anything for it.

Chairman HERGER. The time is expired. It is my understanding -- Mr. Williams, if you would comment -- that the budget resolution approved by the House and the Senate provides for continued funding for the Supplemental Grants Program, about which we were speaking?

Mr. WILLIAMS. Yes, I believe that is right.

Mr. CARDIN. Will the gentleman yield?

Chairman HERGER. Yes.

Mr. CARDIN. You are absolutely correct, but I am trying to see whether the administration is supporting us on that. Congress is probably going to act, but the President can veto. I want to know whether the administration is going to support the supplemental grants and, if you are, where the money is coming from. That is, I guess, our question.

Mr. WILLIAMS. I can't speak for the President specifically, but I think the President has endorsed the budget resolution and my guess is that he will support that particular provision when it is enacted.

Chairman HERGER. Thank you very much, Mr. Doggett, Mr. Cardin, members of our Committee, and I want to thank you again, Mr. Williams, for joining us this morning. I trust that you would respond to additional questions on these issues for the record. It has been a very informative hearing, and I appreciate the time that you have given us today, and with that, this Committee stands adjourned.

Mr. WILLIAMS. Thank you, Mr. Chairman.

[Whereupon, at 11:35 a.m., the hearing was adjourned.]
[Submissions for the record follow:]