SECTION 211-VOCATIONAL EDUCATION FACILITIES ALLOCATION AND APPROVED PROJECTS BY STATE

Section 211-Vocational education facilities

Section 211 of the Appalachian Act authorized $16 million for vocational education facilities. Of this amount $8 million was appropriated in Fiscal 1966 and $8 million in Fiscal 1967.

As of March 31, 1967, the Appalachian Regional Commission had approved 54 Vocational education projects using a total of $11,995,385 in Section 211 funds, while another 11 projects requesting a total of $4,004,615 is now under review at the Commission and in the state education departments. S. 602 authorizes an additional $18 million for this purpose.

Under the Appalachian Act, Section 211 funds were to be spent in the same way and subject to the same conditions as construction funds under the Vocational Education Act of 1963, PL 88-210.

These funds are helping to meet two of the greatest needs in the Appalachian region to upgrade the skills of those unemployed and to provide skills to those about to enter the labor force.

Section 211 funds have helped to accelerate or initiate the construction of new vocational education facilities across the region.

The approved projects utilizing Section 211 funds will provide a variety of skills for 25,000 new students annually. Section 211 projects now under review will provide facilities for another 8,000 students annually. Taken together, all vocational education projects constructed with funds from Sections 211 and 214 will provide new and expanded facilities for almost 33,000 students annually. The Vocational Education Act of 1963, which Section 211 increases, provided Appalachia with $6 million in construction funds in Fiscal 1965, $10 million in Fiscal 1966 and it is estimated that about $10 million will be spent in the Region in Fiscal 1967.

A survey of the Appalachian state vocational education directors indicates that plans and applications are in preparation for vocational education needs in Fiscal 1968 requiring almost $40 million in Federal grant-in-aid funds.

If Vocational Education Act of 1963 construction funds are made available to the Appalachian portions of the states on the basis of their population, no more than $8 million will be available in FY 1968.

Through legislative or administrative means, several of the states authorized two or more school districts to combine for the financing and sponsorship of area vocational schools. This has accelerated the pace of vocational school construction and increased demand for Federal vocational education funds.

SECTION 212-SEWAGE TREATMENT WORKS ALLOCATION AND APPROVED PROJECTS BY STATE

Section 212 authorizes $6 million for grants for the construction of sewage treatment facilities in accordance with the Federal Water Pollution Control Act. $3 million was appropriated in FY 1966 and $3 million in FY 1967. S. 602 authorizes an additional $6 million for this purpose.

As of March 31, 1967, the Commission had approved 16 sewage treatment projects using a total of $2,116,790 in Section 212 funds. Another 11 projects requesting a total of $2,562,203 is now under review at the Commission, in the regional offices of the Federal Water Pollution Control Administration, or in the states. Section 212 funds have been used at a slow rate due to the fact that a state's 212 allocation is not used until its allotment of Federal funds under PL 660 has been committed to projects and sent to the regional offices of the Federal Water Pollution Control Administration. This has meant that it has been late in the Fiscal year when Section 212 funds are committed to projects. We anticipate that authorization of an additional $6 million for this program will be adequate for FY 1968 and FY 1969.

Section 213-HUD planning assistance

Section 213 amended Section 701 of the Housing Act of 1954 to make the Appalachian Regional Commission eligible to receive grants for comprehensive planning and to set the Federal contribution for state Appalachian planning under the 701 program at 75 percent of cost.

Under the authority of this Section planning grants have been approved for the Commission and several of the Appalachian States. North Carolina, Tennessee, New York, Ohio, and Alabama are receiving funds to assist in the preparation of State Investment Plans including special studies of Appalachian problems. The Commission has received a Section 701 grant which will be used largely to support a long-range study and planning effort directed at the central Appalachian area of Kentucky, Tennessee, Virginia and West Virginia. This program is being administered by the Commission staff in conjunction with the representatives of the States involved.

S. 602 amends Section 213 to permit 701 planning grants to be made to local development districts certified under Section 301 of the Act. While in most sections of the Region, local development districts are just coming into existence, it is our hope that many of the planning functions, now discharged by a number of levels of government, can increasingly be concentrated in such multi-county units. The proposed amendment is designed to make this possible as local development districts are organized.

Total, new authorization and uncommitted appropriation_-_

103, 807, 941

SECTION 214-SUPPLEMENTAL GRANT PROGRAM ALLOCATION AND APPROVED PROJECTS BY STATE

Section 214-Supplemental grant-in-aid program

Section 214 authorized $90 million for supplemental grants to enable states, local governments and other applicants to take full advantage of existing Federal grant-in-aid programs. $45 million was appropriated for Fiscal 1966 and

$30 million for Fiscal 1967. S. 602 authorizes an additional $97 million for this purpose. As introduced in the Senate, S. 602 would have authorized $90 million. The authorization was increased to allow for the participation of an area in the state of Mississippi.

As of March 31, 1967, the Commission had approved 264 supplemental grants totalling $43 million. 189 projects requesting $30 million in 214 funds are now under review at the Commission or in the states. Most of these 453 projects, representing a total cost of $350 million, are for six types of facilities: hospitals, higher education, vocational education, sewage treatment, libraries and airports. Section 214 provides that supplemental grants may raise the authorized federal percentage under existing grant-in-aid programs to a maximum of 80 percent. The degree of supplementation is determined by the applicant's ability to pay and relatively few projects have actually received the maximum of 80 percent. For all projects approved as of March 31, 1967, 214 funds have accounted for an average of approximately 21 percent of project cost.

Section 214 was included in the Act to assist communities, counties and states in the Region which have been unable to come up with the matching funds to take full advantage of Federal grant-in-aid programs.

The effect of this program can be seen through a comparison of Federal grants-in-aid in the Region in Fiscal 1965 (when no 214 funds were available) and Fiscal 1966 (when they were).

In Fiscal 1965, the Region received $65.1 million in Federal grants-in-aid funds in the six major programs noted above. In Fiscal 1966, grants totalling $110.6 million were made under the same six programs, with a supplement of $27.8 million in 214 funds. This was an increase of $45.5 million or 70 percent. In both fiscal years the basic Federal grant-in-aid percentage of total project costs has remained at an average 39 percent.

On the basis of grants approved as of March 1, 1967, every dollar of 214 money has accounted for $1.86 in other Federal funds, $1.80 in state and local money, and $4.48 in total projects.

Each state has prepared and submitted an investment plan for its Appalachian counties identifying areas which have significant potential for growth. These plans also identify program areas which are to receive high priority. Alabama, for instance, has concentrated supplemental grant funds on higher education facility construction. Maryland has concentrated on expansion of hospital facilities. In Georgia, 214 funds have supplemented a number of projects which will eliminate water pollution in the major river and water storage areas in northern Georgia. Kentucky's plan detailed a four-year investment schedule relying heavily on 214 funds for the construction of a system of vocational education schools in its Appalachian counties. Thirteen of these schools have been funded and are now nearing completion; eight more have been approved and funded; three are pending at the Commission; and nine more are planned for Fiscal 1968. The decision to concentrate investment to this extent is extremely significant in a state where the overall demand for supplemental funds is probably the greatest in the Region.

The state agencies which program grant-in-aid funds were asked to identify projects for which applications are anticipated in FY 1968. In the six major program areas noted above, it was determined that about $500 million worth of projects could be in the application stage in FY 1968. On the basis of budget requests from Federal agencies, it is anticipated that only about $334 million worth of projects in these categories could be funded if adequate supplemental grant funds are available. On the basis of our experience to date, the authorization in the bill before the Committee should meet the anticipated need for supplemental grant funds.