[Senate Hearing 109-119]
[From the U.S. Government Publishing Office]
S. Hrg. 109-119
HEAD START: ENSURING DOLLARS BENEFIT THE CHILDREN
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON EDUCATION AND EARLY CHILDHOOD DEVELOPMENT
OF THE
COMMITTEE ON HEALTH, EDUCATION,
LABOR, AND PENSIONS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
ON
EXAMINING HEAD START, FOCUSING ON ENSURING DOLLARS BENEFIT CHILDREN
RELATING TO THE EFFECTIVENESS OF THE OVERSIGHT BY THE DEPARTMENT OF
HEALTH AND HUMAN SERVICES' ADMINISTRATION FOR CHILDREN AND FAMILIES IN
IDENTIFYING AND RESOLVING FINANCIAL MANAGEMENT WEAKNESSES IN HEAD START
GRANTEES
__________
APRIL 5, 2005
__________
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COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS
MICHAEL B. ENZI, Wyoming, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
RICHARD BURR, North Carolina BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada PATTY MURRAY, Washington
ORRIN G. HATCH, Utah JACK REED, Rhode Island
JEFF SESSIONS, Alabama HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas
Katherine Brunett McGuire, Staff Director
J. Michael Myers, Minority Staff Director and Chief Counsel
______
Subcommittee on Education and Early Childhood Development
LAMAR ALEXANDER, Tennessee, Chairman
JUDD GREGG, New Hampshire CHRISTOPHER J. DODD, Connecticut
RICHARD BURR, North Carolina TOM HARKIN, Iowa
JOHNNY ISAKSON, Georgia JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada PATTY MURRAY, Washington
ORRIN G. HATCH, Utah JACK REED, Rhode Island
JEFF SESSIONS, Alabama HILLARY RODHAM CLINTON, New York
MICHAEL B. ENZI, Wyoming (ex EDWARD M. KENNEDY, Massachusetts
officio) (ex officio)
Christine C. Dodd, Staff Director
Grace A. Reef, Minority Staff Director
(ii)
C O N T E N T S
__________
STATEMENTS
TUESDAY, APRIL 5, 2005
Page
Alexander, Hon. Lamar, Chairman, Subcommittee on Education and
Early Childhood Development, opening statement................. 1
Enzi, Hon. Michael B., Chairman, Committee on Health, Education,
Labor, and Pensions, opening statement......................... 2
Kennedy, Hon. Edward M., a U.S. Senator from the State of
Massachusetts, opening statement............................... 3
Prepared statement........................................... 4
Horn, Wade F., Ph.D., Assistant Secretary for Children and
Families, U.S. Department of Health and Human Services; and
Marnie S. Shaul, Director, Education, Workforce, and Income
Security Issues, U.S. Government Accountability Office......... 6
Prepared statements of:
Wade F. Horn, Ph.D....................................... 7
Marnie S. Shaul.......................................... 19
Dodd, Hon. Christopher, a U.S. Senator from the State of
Connecticut, opening statement................................. 37
Caccamo, Jim, Director, Metropolitan Council on Early Learning,
Kansas City, MO; A.C. Wharton, Mayor, Shelby County, TN; Yvonne
Gates, Director for Marketing and Community Relations, Center
for Academic Enrichment and Outreach, Clark County, NV; and
Olivia A. Golden, Senior Fellow, Urban Institute............... 44
Prepared statements of:
James M. Caccamo, Ph.D................................... 46
Honorable A.C. Wharton, Jr............................... 49
Yvonne Atkinson Gates.................................... 54
Olivia A. Golden......................................... 59
Clinton, Hon. Hillary Rodham, a U.S. Senator from the State of
New York, opening statement.................................... 73
ADDITIONAL MATERIAL
Statements, articles, publications, letters, etc.:
Response to Questions of Senator Enzi by Wade F. Horn........ 14
Response to Questions of Senator Ensign by Wade F. Horn...... 16
Response to Questions of Senator Alexander by GAO............ 26
Response to Question of Senator Alexander by Mayor A.C.
Wharton.................................................... 51
Response to Questions of Senator Enzi by Olivia A. Golden.... 64
(iii)
HEAD START: ENSURING DOLLARS BENEFIT THE CHILDREN
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TUESDAY, APRIL 5, 2005
U.S. Senate,
Subcommittee on Education and Early Childhood Development,
Committee on Health, Education, Labor, and Pensions,
Washington, DC.
The subcommittee met, pursuant to notice, at 9:30 a.m., in
Room 106, Dirksen Senate Office Building, Hon. Lamar Alexander,
chairman of the subcommittee, presiding.
Present: Senators Alexander, Roberts, Ensign, Dodd, Murray,
and Clinton; and Senators Enzi and Kennedy, Ex Officio.
Opening Statement of Senator Alexander
Senator Alexander. Good morning. This is the Subcommittee
on Education and Early Childhood Development. We are pleased to
have with us the chairman of our full committee, Chairman Mike
Enzi, of the Committee on Health, Education, Labor, and
Pensions. We will be joined a little later by other Senators,
including the ranking member of the subcommittee, Chris Dodd of
Connecticut.
For 40 years, Head Start has been the Federal Government's
largest investment in early childhood education. Its goal is to
encourage equal opportunity, to help all Americans reach the
same starting line.
When I attended nursery school and kindergarten in a
converted garage in my mother's backyard in the mountains of
Tennessee, I was attending the only preschool program in town.
That was well before Head Start. The more we have learned about
preschool education, the more important it has become. Now, 40
States and the District of Columbia offer some form of
preschool education and the Federal Government has broadly
expanded other programs for children under the age of 6.
Head Start offers low-income children and their families
preschool education, family support, health screenings, dental
care, and assistance in accessing medical services.
This past year, taxpayers spent about $6.8 billion to serve
more than 900,000 children in Head Start. These dollars have
grown much more rapidly than inflation. Ten years ago, Head
Start spent about $4,700 per child. Today, we spend about
$7,500 per child.
This Head Start money is distributed in grants to nearly
1,700 local organizations. Many of these organizations, which
we call grantees, operate other Federal, State, or local
programs, or subcontract with other agencies, to provide
services, known as delegate agencies. There are more than
20,000 Head Start centers with more than 48,000 classrooms. As
one of our witnesses observed, managing a program of this
complexity can present many challenges.
Our responsibility here in Congress is to make sure that
taxpayer dollars are being spent for the purposes intended and
for the children intended. Between January 2003 and the first
months of this year, there were numerous accounts from
communities across the country of serious financial abuses or
irregularities by individuals or entities entrusted with Head
Start dollars. That is why the House and Senate Education
Committee leaders asked the Government Accountability Office to
look into allegations of financial abuse and irregularities by
the local agencies or individuals entrusted with Head Start
funds.
The purposes of today's hearing is to consider the findings
of the GAO report as well as its recommendations for how the
Department of Health and Human Services can do a better job of
overseeing the spending of Head Start money. This is not a new
issue. In June of 1998, during the Clinton administration, a
GAO report raised questions about the inconsistency of Head
Start monitoring.
We have with us today, as witnesses, representatives of the
writers of the GAO report and of the Federal managers of the
Head Start money as well as representatives from the community
agencies that actually administer and use the Head Start money.
Our job in Congress, especially as we consider
reauthorization of Head Start for another several years, is to
make sure that it is accountable, financially solvent, and
meeting the purposes for which it is intended. I hope that as
we consider program accountability, we will look for ways to
change a process-oriented system to one that does a better job
of measuring outcomes. In other words, instead of just
requiring grantees to fill out forms and dot ``i''s, should we
not be putting more emphasis on finding out, for example, how
much followup there has been on dental screenings, what the
quality is of parent involvement, and whether the children are
learning what they need to know, and need to be able to do, to
have a more equal opportunity when they enter school?
We have two panels of witnesses today. Wade Horn from the
Department of Health and Human Services and Marnie Shaul from
the Government Accountability Office are on the first panel.
Mayor A.C. Wharton of Memphis, Yvonne Gates from Clark County,
NV, Jim Caccamo from Kansas City, MO, and Olivia Golden from
the Urban Institute are members of the second panel.
We will ask Mr. Horn and Ms. Shaul to testify in just a
moment, but first, I would like to call on our committee
chairman and ranking member, both of whom are here, and to see
if they have any opening comments.
Senator Enzi?
Opening Statement of Senator Enzi
The Chairman. Thank you, Mr. Chairman. I want to thank you
for your leadership on early childhood education policy and for
putting this hearing together. There is no better investment
that we can make for our future than to support programs that
help our children learn, and Head Start is an important part of
that effort. I am looking forward to hearing today's witnesses
about the future of the Head Start program and how we can make
sure it is working effectively to help children enter school
ready to learn.
The testimony we receive today will help shape the
reauthorization of the Head Start program in a way that will
make it stronger, better, and more effective for the children
it serves. That is important. I am the father of three children
and one grandchild. I understand the importance of early
learning. Head Start provides an important service for
thousands of children by providing a safe and healthy
environment. Many of these children do not receive the same
support at home as some of their more advantaged peers, and
Head Start helps meet many of their needs.
The Head Start program has demonstrated a great deal of
success since its creation almost 40 years ago. Lately,
however, several instances of financial mismanagement and other
troubling incidents have been brought to our attention, both
through the recent report issued by the Government
Accountability Office and from dozens of news reports around
the country.
We aren't going to be disparaging or accusing practitioners
at this hearing. Instead, we will look to our witnesses for
help in identifying how Congress can ensure that Head Start
program dollars are being used for the purpose for which they
were intended, which is to help disadvantaged children succeed.
One of the findings in the recent GAO report is that the
monitoring process for the Head Start program can be improved
substantially to help ensure the program is more effective. It
is my hope that today's witnesses will discuss options for
Congress to help strengthen the program's integrity as well as
its impact on student outcomes.
In the past Congress, this committee unanimously supported
a Head Start reauthorization bill that would have made many of
the improvements suggested by the GAO study. It is my hope that
today's witnesses will comment on these efforts and suggest
some alternative policy options, as well.
In the current economy, continued learning is more
important than ever. We need to make sure that Federal
programs, such as Head Start, are giving children the best
possible start, since today's students are tomorrow's leaders.
The Head Start program is an important beginning to a lifetime
of education opportunities that will make it possible for
today's students to support families in the future. It is
essential that all children get a good start and that the Head
Start program provides the type of educational foundation that
will support a lifetime of learning and success.
Again, thank you for holding this hearing. I expect it to
be useful to the committee as it works on the reauthorization.
Senator Alexander. Thank you, Mr. Chairman.
Senator Kennedy, who is the ranking member of our full
committee.
Opening Statement of Senator Kennedy
Senator Kennedy. Thank you very much, Mr. Chairman. I want
to thank you for having this hearing, thank our chairman,
Senator Enzi, for his longtime interest in Head Start. Thank
you, Mr. Chairman, for your strong commitment on education and
also for your recognition about early intervention, its
importance, the difference it makes in the development of a
child's life and also the paths it opens up, not only
educationally, but socially and in other ways in terms of early
intervention. I think we know that Head Start does work. It is
important.
We know, as well, that we tried to address some of the
problems in our bipartisan effort in the areas of recompetition
and better enforcement and followup on under-involvement and
more efficient and thorough audits. I think we all know that
increased and improved training at the local level can help
resolve some of these issues, and I think we are all interested
in giving focus and attention to the major kinds of issues and
problems that are out there and how we can deal with them and
give priority, obviously, to those particular issues.
I am a strong believer in the Head Start program and have
visited so many in my own State and talked with people and
parents and met these young people. I even had a chance during
the break to visit some in the Greater Boston area. So we are
looking forward to getting a solid result. We thank you very
much for your leadership on this and we want to work very
closely with you and the chairman to try to get a positive
outcome. Thank you. I will put my full statement in the record.
Senator Alexander. Thank you, Senator Kennedy.
[The prepared statement of Senator Kennedy follows:]
Prepared Statement of Senator Kennedy
I commend Chairman Enzi and Senator Alexander for
scheduling today's hearing on Head Start, which gives us an
opportunity to consider effective ways to improve and
strengthen all aspects of this vital program.
One thing is clear--Head Start is a lifeline for the
neediest families and children across the Nation. For 40 years,
it has given disadvantaged children the assistance they need to
arrive at school ready to learn. Its balanced curriculum to
help them develop the intellectual skills they'll need to meet
high academic standards later in school. Equally important, it
helps them learn to get along with their fellow students, and
delivers the social and emotional building blocks they'll need
to keep up once they reach kindergarten.
Head Start also makes it possible for these children to see
doctors and dentists, and be immunized against childhood
diseases. It teaches children to eat healthy meals. Every Head
Start center is grounded in the community in which it operates
and supports. Parents are welcomed into their children's
classrooms and urged to participate actively in the local
programs.
These services are backed by impressive research. Children
who participate in the program make gains in vocabulary, and
develop early reading and math skills. By the end of their
kindergarten year, Head Start children are typically performing
at or above national averages. That's a remarkable achievement,
given the devastating effects of poverty on children.
Our challenge in reauthorizing Head Start this year is to
build on the program's many strengths, identify the problems it
faces, and enable administrators, teachers, parents, and
families to deal with them. We welcome the opportunity today to
hear more about Head Start's oversight, and discuss ideas to
improve its management.
Our goal is to ensure that Head Start's services reach as
many children and families as possible. The need for Head Start
is still miles from being met. Today it serves fewer than 6 out
of every 10 eligible children and only 3 out of every hundred
infants and toddlers through its sister program, Early Head
Start.
President Bush's budget proposes to increase funds for Head
Start by only $45 million, and would set-aside those funds for
nine States willing to turn Head Start into a block grant.
Block grants are the wrong direction for Head Start. They don't
guarantee medical check-ups, healthy meals, dental visits, or
medical screenings for children. They don't guarantee support
to families and parents. Lower quality and lower standards are
not the way to strengthen Head Start. We need to invest more--
not less--in the families and children the program serves.
We can do more to see that every dollar invested in Head
Start delivers the highest quality of services in the most
effective manner. New resources for Head Start should be
accompanied by effective steps to genuinely improve the
program.
We welcome the testimony today from the GAO and other
witnesses on the oversight and management of Head Start,
especially on ways to measure risks and potential problems more
accurately and adopt more effective strategies to meet them. We
know what works in Head Start and it's time to put these
practices into place.
For years, Head Start has had one of the most comprehensive
monitoring systems in early childhood education. Over the
years, it has been revised and improved, based on Head Start's
actual services. Annual auditing, reporting, and financial
accounting are critical for the quality of the programs and the
most effective level of services.
It's clear that the number of Head Start programs with
serious problems is small--15 percent or fewer of all programs,
by the Department's own calculation. But clearly, when any
problem is identified in a program--no matter what the issue--
it must receive appropriate attention and followup from those
responsible at the Federal level.
Thanks to the bipartisan cooperation of committee members
in the last Congress, we made good progress in working together
on these improvements. We did more to enhance the skills and
qualifications of Head Start teachers, upgraded the educational
components of the program, and increased coordination at the
State level with other programs.
I look forward to continuing our bipartisan work this year.
We are fortunate to begin that work today by hearing from
witnesses who will share their expertise and insights from the
Federal and local levels. Thank you all for joining us this
morning.
Senator Alexander. I am going to give brief introductions
so we can get right on with it, and I will ask these two
witnesses if they will limit their remarks to 10 minutes or
summarize their comments and focus on them. We have your
statements. We appreciate them. That will give the Senators
more chance to ask questions.
Marnie Shaul is Director of the Education, Workforce, and
Income Security Team at the U.S. Government Accountability
Office. So she is responsible for the studies GAO undertakes
for the Congress on early childhood programs. Thank you very
much, Ms. Shaul, for being here.
And Dr. Wade Horn, who we will ask to go first, was named
Assistant Secretary for Children and Families in the
Administration for Children and Families of the U.S. Department
of Health and Human Services. That is a very long title, but he
has had a long background in social services and is ultimately
responsible for the administration of this Federal Government
for about $6.8 billion of money that goes to Head Start
grantees around our country.
So, Mr. Horn, why don't we start with you, then with Ms.
Shaul on the report, and then we will go to questions.
STATEMENTS OF WADE F. HORN, ASSISTANT SECRETARY FOR CHILDREN
AND FAMILIES, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES; AND
MARNIE S. SHAUL, DIRECTOR, EDUCATION, WORKFORCE, AND INCOME
SECURITY ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Horn. Thank you, Mr. Chairman and members of the
committee. I am very pleased to have this opportunity to appear
before you today to discuss the recent report of the Government
Accountability Office on Head Start. The President is committed
to strengthening Head Start, has made accountability a guiding
principle of our work, and I can assure you that we take GAO's
findings very seriously.
For nearly 2 years now, we have been actively and
aggressively engaged in addressing many of the weaknesses cited
in this report. Other suggestions in the report will help us
plan and implement additional strategies for enhancing the
quality and credibility of our oversight of the Head Start
program in order to ensure that all Head Start children receive
the Head Start they deserve.
The Head Start program is now in its 40th year. It is a
nearly $7 billion program, serving more than 900,000 low-income
children and families through a network of over 1,600 local
grantees. Head Start children are served in nearly 50,000
classrooms located within more than 20,000 centers which are
located in more than 3,000 counties nationwide.
Head Start is, in short, a program that has wide-ranging
presence and influence. It ought to be absolutely the best
early childhood education program we can design. As stewards of
this program, we are committed to making that goal a reality. I
will focus my testimony today on our ongoing efforts as well as
some of our planned initiatives to improve program oversight
and stewardship.
As discussed in the GAO report, we have several ongoing
procedures to examine program compliance and to measure
results. Key among these is the mandated triennial onsite
monitoring of local programs. Monitoring is one of our best
opportunities to ensure that every Head Start program is
accountable to all applicable statutes and regulations.
In the last several months, and consistent with many of the
GAO's observations and recommendations, ACF has implemented
several efforts to improve our oversight of local Head Start
programs. First, we have established for the first time minimum
qualifications for all reviewers in the area that they are
reviewing. Establishing these minimum qualifications helps
ensure that all individuals on a monitoring review team have
the knowledge, skills, and experience necessary to be part of a
quality review.
Second, in December of last year and February of this year,
we provided intensive multiday training for more than 1,000
reviewers in the areas of fiscal, program management, and early
childhood development. Additional training will be conducted
later this year for reviewers in the fields of health and
nutrition services, mental health services, and family and
community partnerships.
Third, we will soon be implementing a quality assurance
initiative in which specially trained reviewers will lead teams
to conduct re-reviews of a sample of recently monitored
grantees. We believe this effort will substantially address
GAO's concern about consistency among reviewers and across ACF
regional offices.
Fourth, we have begun conducting indepth analyses of all
triennial and first-year monitoring reports to improve report
quality, comprehensiveness, accuracy, and uniformity within and
across the regions.
Fifth, ACF substantially revised the fiscal checklist used
during all fiscal reviews to incorporate a risk-based
assessment approach. This will allow us to identify fiscal
issues which may suggest underlying fiscal problems.
Sixth, ACF is requiring that the program review instrument
for systems monitoring or PRISM review teams to closely examine
several specific areas that were not as carefully or
consistently considered in the past, including transportation
services, condition and Federal interest in facilities,
salaries and staff compensation, maintenance of full
enrollment, and income eligibility.
And finally, this year, ACF began emphasizing to grantees
that conducting quality, comprehensive program self-assessments
are critical to ensuring the delivery of high-quality services
to children and families in their programs.
I hope this information has provided a clear picture of our
continued and more aggressive commitment to improving program
oversight and monitoring. We also look forward to working with
the Congress in the upcoming discussion of Head Start
reauthorization to explore statutory changes that can enhance
the Secretary's flexibility to replace poorly performing
grantees.
In conclusion, I want to assure this committee that the
President, the Department, and ACF are committed to
strengthening the quality of Head Start. We acknowledge that we
can and must do better. I feel confident that, working
together, we will achieve this goal. Thank you very much.
Senator Alexander. Thank you, Dr. Horn.
[The prepared statement of Mr. Horn follows:]
Prepared Statement of Wade F. Horn, Ph.D.
Chairman Alexander and members of the committee, I am pleased to
have this opportunity to appear before you today to discuss the recent
report of the Government Accountability Office (GAO) on ``Head Start:
Comprehensive Approach to Identifying and Addressing Risks Could Help
Prevent Grantee Financial Management Weaknesses.'' The President is
committed to strengthening the quality of Head Start to improve the
school readiness of low-income preschool children and has made
accountability a guiding principle of our work. Within this context, I
can assure you that we take GAO's findings very seriously and for
nearly 2 years we have been actively and aggressively engaged in
addressing the weaknesses cited in the report.
The Head Start program is now in its 40th year. It is a nearly $7
billion program, serving more than 900,000 low-income children and
families through a network of 1,600 local grantees. There are 212,000
staff employed in Head Start programs and more than 1.3 million persons
volunteer in local programs. Head Start children are served in nearly
50,000 classrooms located within more than 20,000 centers, which are
located in more than 3,000 counties nationwide. Head Start is, in
short, a program that has wide ranging presence and influence. It ought
to be absolutely the best early childhood education program we can
design. As stewards of this program, we are committed to making that
goal a reality.
I will focus my testimony today on our ongoing efforts, as well as
some of our planned efforts, to improve program oversight and
stewardship. Several of GAO's findings mirror weaknesses we previously
identified and are actively working to resolve. Other suggestions in
the report will help us plan and implement additional strategies for
enhancing the quality and the credibility of the Head Start monitoring
system in order to ensure that all Head Start children receive the head
start they deserve.
Head Start Monitoring
As discussed in the GAO report, we have several ongoing procedures
to examine program compliance and to measure results. Key among these
is the mandated, triennial, onsite monitoring of local programs. Under
the Head Start Act, each grantee must be monitored at the end of the
1st year of operation and intensely at least once every 3 years
thereafter. These reviews are conducted by consultants with
professional expertise in their assigned area, under the direction of a
Federal team leader. Most teams are composed of approximately six to
eight reviewers; additional reviewers may be assigned to review larger
or more complex programs.
Written reports containing findings from these reviews are provided
to each grantee and corrective action must be implemented by the
grantee. Programs identified as deficient must correct all deficiencies
within a prescribed period of time or we must seek to terminate the
grantee's authority to operate that Head Start program.
In fiscal year 2004, the Administration for Children and Families
(ACF) conducted triennial reviews of 570 programs. Eighty-nine of these
programs were identified as deficient. Each was issued a report by ACF
mandating correction of their deficiencies within a specified time
period, not to exceed 1 year. Any of these 89 grantees that do not
correct their deficiencies must have their grant terminated. In fiscal
year 2004, ACF replaced 20 grantees with unresolved fiscal and quality
issues.
Monitoring is one of our best opportunities to measure the quality
of Head Start programs. As Federal stewards, we must use our monitoring
procedures to assure we are holding every Head Start program
accountable to all applicable statutes and regulations.
In the last several months, and consistent with many of the GAO's
observations and recommendations, ACF has implemented several efforts
to improve our monitoring.
First, we have established for the first time minimum
qualifications for all reviewers in the area they are reviewing. For
example, a reviewer wanting to do fiscal reviews must have a minimum of
a bachelor's degree with at least 12 credits in accounting, with a
preference for a degree in accounting. Establishing these minimum
qualifications helps assure that all individuals on a monitoring review
team have the knowledge, skills and experience necessary to be part of
a quality review. Reviewers not meeting these qualifications can no
longer participate in Head Start reviews. Qualified individuals must be
annually certified and meet our minimum requirements. Additional
individuals will be recruited, trained, mentored, and added to the
reviewer pool.
Second, we have implemented a formal assessment process in which
the Federal team leaders and reviewers assess the performance of their
team members. These assessments are conducted after every review.
Assessment scores and comments are tracked for individuals over
multiple reviews. Reviewers with identified patterns of ``poor
performance'' are removed from the Head Start reviewer pool.
Third, in February and December 2004 we provided intensive, multi-
day training for more than one thousand reviewers in the areas of
fiscal, program management, and early childhood development. We also
have provided and are continuing to provide professional development
for Federal team leaders and Federal grants staff. Training for team
members provides a very clear understanding of the nature of their
responsibilities as part of a monitoring team, and the important roles
they play in helping to assure a quality Head Start experience for
every child and family.
Additional training will be conducted later this year for reviewers
in the fields of health and nutrition services, disabilities services,
mental health services, and family and community partnerships. We feel
confident that these three changes will go a long way in helping us
assure that only qualified, skilled reviewers perform the vital role of
evaluating the comprehensiveness, local management, and quality of our
Head Start programs.
Soon we will implement a quality assurance initiative in which
specially trained reviewers will lead teams to conduct re-reviews of a
sample of recently monitored grantees. We believe this effort will
substantially address GAO's concern about consistency among reviewers
and across ACF regional offices. The re-review teams will go onsite to
grantees that have been monitored within the previous few months. A
second, complete monitoring review will take place and the results will
be evaluated by the Head Start Bureau. This will allow us to make
better-informed professional judgments about the reliability of our
current monitoring teams, including individual reviewers and Federal
team leaders. We believe this approach also will allow us to achieve
more complete, more accurate, and more consistent monitoring outcomes.
In addition, we are conducting indepth analyses of all triennial
and 1st year monitoring reports. The results of these analyses are
provided to regional administrators for regional quality assurance and
staff training. The Head Start Bureau has created a two-part strategy
to improve report quality, comprehensiveness, accuracy and uniformity
within and across regions. First, draft deficiency reports are analyzed
and reviewed for accuracy by the Head Start Bureau prior to release to
grantees, with the results and recommendations of these analyses sent
to the regional administrators. In the second part of this strategy the
Head Start Bureau has established standards for all other letters and
reports related to grantee monitoring.
Additionally, ACF is continuing our emphasis on improving each
grantee's fiscal viability. For example, the Fiscal Checklist, now used
by all fiscal reviewers, was substantially revised in fiscal year 2005
to use a ``risk-based'' assessment approach in alignment with GAO's
recommendation. The Fiscal Checklist includes a set of very specific,
prioritized indicators, or ``red flags,'' designed to identify fiscal
issues which may suggest underlying fiscal problems. These indicators
focus on those areas or irregularities which are most likely to have
the greatest adverse impact on the fiscal accountability of the
grantee. Grantees whose indicators suggest current or possible future
problems will be subject to a more detailed review of their fiscal
systems and records to determine if there are indeed problems that
impact the grantee's fiscal operations and management.
Further, ACF is requiring the Program Review Instrument for Systems
Monitoring (PRISM) review teams to closely examine several specific
areas that were not as carefully or consistently considered in the
past. These include transportation services, condition and Federal
interest in facilities, salaries and staff compensation, maintenance of
full enrollment, and income eligibility.
Also, in fiscal year 2005, ACF is emphasizing the conduct of
required grantee self-assessments. Grantees have been reminded that
conducting quality, comprehensive program self-assessments are critical
to ensuring the delivery of high-quality services to children and
families. Grantees must conduct accurate, comprehensive self-
assessments building on information from the triennial Federal
monitoring review to further program improvement, regularly identify
issues, correct problems, and improve services.
GAO Recommendations
I hope this information has provided a clear picture of our
continued and more aggressive commitment to improving program
monitoring. This is a goal we have undertaken in earnest over the past
year. The GAO report synthesized many of the concerns we have had
regarding program weaknesses. This report affirms that we are on the
right track in strengthening our oversight and accountability efforts.
While my initial remarks today have provided some insight into our
responses to the GAO recommendations, I would like to take this
opportunity to briefly and specifically walk through each of the
recommendations in their report and our response.
1. (a) ACF should develop a strategy to produce a comprehensive
risk assessment of the Head Start program which would provide
reasonable assurance that a Head Start grantee's finances are
reasonably sound and that program objectives are being met.
We fully support the recommendation to develop a ``comprehensive
risk assessment'' of the Head Start program. We are looking to both the
HHS Office of Inspector General's Risk Assessment Protocol as well as
tools used by GAO that have been adopted by other agencies in ACF in
our efforts to develop this comprehensive risk assessment.
Over the next few months, we will continue developing an approach
that will allow us to identify, early on, grantees that have issues
that could suggest potential fiscal or programmatic problems. Beginning
with the indicators in the fiscal checklist, we will identify the
factors we should use in determining a grantee's fiscal and
programmatic accountability. We then will identify the data source or
sources we will use to consistently collect information about each of
the factors. Finally, we will determine the relative risks associated
with each of these factors and develop a rating system that tells us
when a grantee is at risk of heading down a path to larger fiscal or
programmatic problems. We believe that such a system will enable us to
identify at risk grantees while there is still time to work with them
and implement appropriate change.
1. (b) ACF should collect data on improper payments made by Head
Start grantees.
ACF will assure that grantees are held accountable for improper
payments made with Head Start grant funds. For example, this year
monitoring teams will be looking more carefully and more systematically
at the way grantees expend all of their Head Start funds. Also, we are
continuing our strong focus on improper payments begun last year by
visiting 50 randomly chosen grantees to review grantees' enrollment
files and determine whether they are serving only children who are
eligible for Head Start.
As an additional strategy for examining improper payments, we have
begun rigorously enforcing the new requirement enacted by Congress to
cap the compensation of Head Start staff. We will move to disallow
costs expended by a Head Start grantee when they are in violation of
this cap. Further, we will continue our efforts to assure all grantees
are serving the full number of children for which they have been funded
by holding grantees accountable for upholding all terms and conditions
of their grant award. Grantees failing to do so will see their funding
levels reduced.
2. ACF should train and certify all PRISM reviewers.
As I discussed earlier, over the last several months, we provided
PRISM training to Federal team leaders and to fiscal, program design
and management, and early childhood consultants. ACF has and will
continue to schedule additional training events for consultants in
other areas of expertise to ensure that all reviewers have appropriate
training. ACF agrees with GAO that reviewer training needs to be
provided regularly and designed to assure reviewers have the knowledge
and appropriate understanding of their roles in assisting ACF in
determining the management and quality of our Head Start programs.
3. ACF should develop an approach to assess the results of PRISM
reviews and ensure consistency among Regional Offices.
ACF's Head Start Bureau is continuing an effort begun last year in
which all monitoring reports to be issued by the regional offices are
reviewed and critiqued, providing feedback to the regions about the
quality, comprehensiveness and accuracy of these reports and related
letters to grantees. We also are analyzing data from monitoring
findings and discussing areas of inconsistency within and across our
regional offices. When regional data indicate inconsistencies in the
number and types of problems found in Head Start grantees, we are
working more closely with those regional offices to uncover the reasons
for the inconsistencies and be certain they do not reoccur.
As mentioned earlier, in fiscal year 2005, ACF will be implementing
a quality assurance system in which a selected number of programs will
be ``re-reviewed'' a few months after their regularly scheduled PRISM
review. This is another method that will help us achieve greater
consistency across regions and among reviewers. Further, ACF is
supportive of legislative change that can provide the Administration
increased flexibility to use the best team leaders available for a
particular review by not requiring every team leader to be a Federal
employee.
We want to acknowledge our agreement with the GAO, that for too
many years we have relied too heavily on a grantee's self-certification
that serious non-compliances have been corrected. There may be some
situations in which such certifications are sufficient; however,
reliance on this practice for ensuring grantee corrective action must
be dramatically reduced. Therefore, ACF is significantly increasing the
use of onsite visits to verify corrective actions. These site visits
will focus on whether the grantee has made systemic, sustainable
changes to reduce the possibility of repeating problems in the future.
This approach also will help regional offices more consistently assess
a grantee's success in correcting identified problems in both the short
and the long term.
4. (a) ACF should implement a quality assurance system to assure
onsite reviews are being conducted as intended to provide ACF with
objective and accurate data about grantees.
As noted above, in fiscal year 2005, ACF will be implementing a
quality assurance system designed to enhance consistency and quality
among both regional offices and reviewers. Specially trained review
teams made up of some of the best reviewers in the country will visit
grantees that have been monitored within the last few months. A
complete monitoring review will take place; the results of which will
be shared with the responsible ACF regional office. This process will
allow us to make more informed, professional judgments about the
reliability of our current monitoring teams; including individual
reviewers and Federal team leaders. We believe this approach will help
enhance the process of achieving more complete, more accurate, and more
consistent monitoring outcomes.
4. (b) ACF should assure the accuracy of its data collection forms.
ACF and others rely upon the annual Program Information Report
(PIR) and other data. We will, therefore, continue to explore ways to
increase the accuracy of the PIR and other data sources. We will, for
example, initiate an effort this year in which we will visit randomly
selected Head Start programs to conduct a validation study of the data
reported on the PIR. We also initiated procedures to assure that the
information grantees report on their required salary comparability
studies is accurate and current. In addition, Head Start staff
currently is working with ACF information technology staff to develop a
single, integrated database that will contain all the current Head
Start data sources. This integrated database will allow us to take a
comprehensive approach to examining the management, fiscal and
programmatic status of Head Start grantees.
5. ACF should make greater use of information currently available
to regional offices to more quickly identify potential risks.
ACF will make more complete use of all data sources available to us
to assure we are able to identify risks as quickly as possible. Central
and regional offices will jointly develop specific protocols to assure
that we are making full and timely use of the fiscal and other data
available.
6. ACF should recompete Head Start grants when the current
recipient has not met its obligations in the areas of program or
financial management.
ACF is looking forward to working with the Congress in the upcoming
discussions on Head Start reauthorization to explore changes to the act
that can enhance the Secretary's flexibility to replace poorly
performing grantees. Without such statutory changes, we do not believe
we can implement GAO's proposed recommendation in this area. It is our
position that, because of current statutory language there can be
lengthy delays before we can replace the grantee in charge of Head
Start operations in that community.
More specifically, we would like to work with this committee to
amend language in the current Head Start Act which provides current
grantees with priority consideration for funding and which requires
grantees to be given a hearing before being replaced, no matter how
poor their operations and performance may be. We believe the current
system makes it unnecessarily time consuming and difficult to remove
grantees which are not responsibly delivering comprehensive, quality
services. Like GAO, we are particularly dismayed by the increasing
number of grantees with recurring problems that fail to correct or only
temporarily correct areas of non-compliance and deficiencies. We look
forward to working with Congress to give HHS the ability to quickly
remove poor performing grantees so that we are providing the best
quality services possible to Head Start children.
Additional Program Improvement Efforts
I would like to close my remarks by sharing with this committee
several other efforts the Administration is engaged in designed to
improve grantee quality and accountability. Foremost among these is
working with this committee and this Congress to pass a Head Start
reauthorization bill which will send a clear message that all Head
Start grantees are expected, at all times, to deliver high quality
services to every enrolled child and family.
First, we would like the Congress to help us increase the
involvement of selected States in Head Start as we move to increase
coordination between Head Start, State pre-K programs, and child care
services. Second, we would like the Congress to provide the Secretary
with greater discretion to use funds appropriated for Head Start in the
most effective manner possible by enacting changes to the current
statutory set-aside for training and technical assistance. Third, we
would like the statute to more clearly state the expectation that all
children should leave Head Start prepared for school and that the
standards for school readiness are being met. Fourth, we would like
increased flexibility in the makeup of our monitoring teams so that we
always can send out the most qualified individuals for the job. And
fifth, we would like to work with Congress to ensure that the statute
allows us to deal with poorly performing grantees fairly but
expeditiously.
In addition to these proposed statutory changes, I would like to
close by sharing information about one other training and technical
assistance project which, although not directly related to monitoring,
plays an important role in assuring grantees are providing high quality
services to the communities they serve. We are in the 2nd year of a new
training and technical assistance (T/TA) system that we believe will
help improve grantee quality and, by so doing, address some of the
underlying issues raised by GAO. We have, for the first time, hired T/
TA specialists who are assigned to work on a regular basis with
individual grantees. These specialists will help grantees identify T/TA
needs and appropriate ways of meeting these needs. They will visit
their assigned grantees several times a year to focus on improving
grantees. The local specialists are supported by a team of content
experts in each regional office to provide guidance to grantees and to
support the local specialists in their technical assistance work within
programs.
Conclusion
In conclusion, I can assure this committee that the President, the
Department and ACF are committed to strengthening the quality of Head
Start. In keeping with the findings of this GAO report--we can do
better. The Administration for Children and Families will continue to
improve program oversight to ensure program quality and effectiveness.
At the same time, we look forward to working with you to make
appropriate changes to Head Start's legislation that will hold all
grantees accountable for all requirements and for providing quality
service. I feel confident that together we will achieve these goals.
Thank you. I would be happy to answer any questions.
Response to Questions of Senator Enzi by Wade F. Horn
Question 1. The Senate bill to reauthorize the Head Start program
from the 108th Congress included provisions that would require Head
Start grantees to recompete for those funds periodically. One of the
GAO's recommendations to the Department is to provide the current
grantee with a certain degree of priority over other grantees. How
should Congress help support these efforts to ensure high quality
grantees are able to continue serving children, while still weeding out
less effective or troubled programs?
Answer 1. We would welcome the opportunity to work with you on
language that would enhance the Secretary's ability to periodically
recompete Head Start grants and replace poorly performing grantees. In
conjunction with this type of change, statutory change also is needed
to allow the Secretary to defund a deficient grantee which has not
corrected its deficiencies within the required timeframe. Currently,
section 646(a) of the Head Start Act precludes terminating funding of a
grantee pending appeal and a full and fair hearing, which often can
take several months and, sometimes more than a year.
Question 2. In the GAO report where the comments from the
Department of Health and Human Services are included, the Department
suggests that it will take action or continue to take action to address
many of the concerns raised in the report. Since the report suggests
that the Department may have an interest in having Congress clarify our
intent in statute, are there specific recommendations you can make that
will help Congress support your activities to improve the program?
Answer 2. My testimony provided a number of suggested changes to
Head Start that we would like to explore with the Congress. First, we
would like the Congress to help us increase the involvement of selected
States in Head Start as we move to increase coordination between Head
Start, State pre-K programs, and child care services. Specifically, we
would like Congress to include in the reauthorization of the Head Start
Act a provision that will allow interested States to include Head Start
in their preschool plans. Under the proposal, States are offered the
opportunity to coordinate preschool programs with Head Start programs
in exchange for meeting certain accountability requirements. Second, we
would like the Congress to provide the Secretary with greater
discretion to use funds appropriated for Head Start in the most
effective manner possible by enacting changes to the current statutory
set-aside for training and technical assistance. Third, we would like
the statute to more clearly state the expectation that all children
should leave Head Start prepared for school and that the standards for
school readiness are being met. Fourth, we would like increased
flexibility under section 641A of the Head Start Act in the makeup of
our monitoring teams so that we always can send out the most qualified
individuals for the job. And fifth, we would like to work with Congress
to ensure that the statute allows us to deal with poorly performing
grantees fairly but expeditiously. As I indicated earlier, the current
statute requires a protracted hearing process before we can defund
deficient grantees. I would be pleased to work with the committee to
provide details on each of these proposals.
Question 3. According to the GAO report, more than half of the
grantees identified as having financial management problems also
demonstrated recurring financial management issues. Even so, the
Department of Health and Human Services has not taken action to deny
grant funding to these programs. What can Congress do to ensure that
appropriate action is taken against grantees with severe and recurring
financial management problems?
Answer 3. One problem is that in the past ACF Regional Offices
often accepted grantee letters of compliance stating that non-
compliances were corrected. Although there are legitimate situations in
which a letter and corresponding documentation may be sufficient to
determine that a non-compliance has been corrected, there also are many
situations that should be verified through an onsite visit. In fiscal
year 2005, ACF is establishing a new policy that reduces the acceptance
of letters of compliance and greatly increases the use of onsite
followup reviews to verify compliance. This will help reduce the number
of repeat findings by assuring, onsite, that all problems have indeed
been corrected.
In addition, ACF is developing a ``comprehensive risk assessment''
of the Head Start program. This approach will allow us to identify,
early on, grantees that have issues that could suggest potential fiscal
or programmatic problems. Beginning with the indicators in the fiscal
checklist, we will identify the factors we should use in determining a
grantee's fiscal and programmatic accountability. We then will identify
the data source or sources we will use to consistently collect
information about each of the factors. We also will determine the
relative risks associated with each of these factors and develop a
rating system that tell us when a grantee is at risk of heading down a
path to larger fiscal or programmatic problems. This type of system
will enable us to identify at risk grantees while there is still time
to work with them and implement appropriate change.
Finally, Congressional action is needed to allow the Secretary to
defund a deficient grantee which has not corrected deficiencies within
the required timeframe. Currently, section 646(a) of the Head Start Act
precludes terminating funding of a grantee pending appeal and a full
and fair hearing.
Question 4. The GAO report and your testimony today identifies
self-certification by grantees that they have resolved audit or site-
visit findings as one of the reasons the Administration on Children and
Families is having difficulty preventing recurring financial or other
types of mismanagement. What role do you see self-certification playing
to resolve concerns in the future, and what can Congress do to support
efforts by the Administration to ensure programs are independently
reviewed?
Answer 4. As I discussed in my response to your previous question,
ACF is making significant changes in the way we determine if grantees
have corrected identified areas of non-compliance. In the past, we have
often accepted grantee self-certification and to do onsite visits to
verify compliance only on occasion. We are fundamentally revising this
approach to require that verification of compliance be determined
through an onsite visit and only, for a relatively small number of
cases, will we accept grantee self-certification.
Question 5. The issue of recompetition appears to be the only area
where the Administration on Children and Families suggests they need
Congress to be involved in addressing the suggestions within the
report. Are there additional ways that Congress can improve the
accountability process within the Head Start program, and is there a
role for Congress to play in the other recommendations made by GAO?
Answer 5. The issue of recompetition and a related issue of the
grantee appeal process are key areas in need of statutory change to
assist us in improving the quality of Head Start programs.
Specifically, with respect to the grantee appeal process, we would like
to work with the Congress to change provisions in the Head Start Act
which allow Head Start grantees which have been judged to be poorly
performing and, consequently, have been sent letters terminating their
grant to continue receiving their full Head Start grant during the
appeals process. Most Head Start appeals take several months, some have
lasted for well over a year and the grantee which already has been
determined to be deficient is allowed, during this time, to continue to
operate its failing Head Start program. We would like to change this
and give Head Start grantees the same appeal rights as all other HHS
grantees whose funding is discontinued as soon as a determination is
made that performance is deficient. Interim grantees would be put in
place to ensure that services are not interrupted.
Response to Questions of Senator Ensign by Wade F. Horn
Question 1. The GAO report stated that many individuals hired as
PRISM (Program Review Instrument for Systems Monitoring) reviewers do
not have their references checked prior to hiring. This has led to
widespread outcome differences across regions during triennial PRISM
reviews at Head Start Centers. I am very concerned about this trend and
the part it may have played in allowing grantees to continue receiving
Federal funds despite poor accountability and fiscal controls. As part
of the implementation of minimum requirements for these reviewers will
references and qualifications be checked prior to hiring? What benefits
do you see of having private sector individuals complete these PRISM
reviews?
Answer 1. ACF will, within the next few weeks, begin a policy of
checking reviewer references and qualifications. We appreciate that it
is important to assure that all Head Start reviewers have the skills
and background needed to properly perform their job of monitoring the
performance of Head Start programs. This effort, coupled with
additional efforts we are currently undertaking--such as implementing a
quality assurance system in which a selected number of programs will be
re-reviewed within a few months of their initial onsite review,
establishing a rating system for reviewers and providing all reviewers
indepth training--will help address the problem of Regional
inconsistency. We also are working closely with our Regional Offices to
assure that all Federal Team Leaders fully understand the importance of
doing a professional and objective assessment of each Head Start
program, and we will explore cross regional review efforts, where
appropriate, as another way to enhance regional consistency.
We will assure that all fiscal reviewers are competent to do the
job for which they have been hired. These reviewers now have to meet,
for the first time, minimum qualifications and have been provided
indepth training on how to conduct a fiscal review. Fiscal reviewers
are, in fiscal year 2005, using a new fiscal checklist which will, we
believe, go a long way to identifying Head Start grantees with fiscal
problems early on when there is still time to correct the problem.
We think we must continue to take advantage of using reviewers who
are not Federal employees. There are many individuals available to the
Head Start review system who are expert in their fields. We would not
be able to even approach this level of expertise using only the staff
in the Federal Government who work on Head Start. Most Federal Head
Start staff are generalists who, while certainly knowledgeable about
Head Start and early childhood education, do not have the kinds of
specific skills, experiences or training that our private reviewers
have. We have, for example, dentists, certified public accountants,
early childhood experts and many other well qualified contractors who
are vital to a comprehensive, quality monitoring system.
In addition, it would be extremely helpful if the committee would
consider a statutory change providing flexibility in the makeup of
monitoring teams so that we can always send out the most qualified
individual for the job. Currently, section 641A(c)(2) requires that
monitoring reviews are performed and supervised by departmental
employees knowledgeable about Head Start. We would like this changed to
provide the Secretary the flexibility to ensure that reviewers are
experts in the fields they are responsible for reviewing.
Question 2. In the case of the Economic Opportunity Board (EOB) in
Las Vegas, the entity was required to submit annual audits. It is
unclear to me how these audits were used and whether onsite review
teams relied on the audit data. In fact, the GAO report stated that
many regional staff do not effectively use the audit data provided,
often because of the lag in reporting the audit outcomes. Over the
course of 2 years EOB had two different onsite reviews, first the
triennial PRISM review, and second, a follow up review by the Head
Start Bureau to determine if the deficiencies found in the PRISM review
had been resolved. What happens with this audit data once it is
reported to the Head Start Bureau and the Administration for Children
and Families? As part of the comprehensive risk assessment, is the
Bureau going to put in place policies that utilize these audits in
determining whether a grantee is a financial risk, or having financial
difficulties?
Answer 2. ACF currently reviews all grantee audits which have
findings in order to help inform us about the state of our grantees'
fiscal health.
OMB Circular A-133 requires non-Federal entities that expend
$500,000 or more in a year in Federal awards to have an audit conducted
for that year. Audits are to be submitted to the Federal Audit
Clearinghouse which reviews the audit reports to assure they meet the
A-133 requirements. HHS Audits are then sent to the HHS Office of the
Inspector General (OIG), where they are reviewed and those with any
findings are assigned to the appropriate HHS office. For audits with
findings in the Head Start program, the audit is sent to the
responsible ACF regional office for resolution. ACF makes a
determination as to how to resolve the audit findings and so informs
the grantee. Findings with monetary values typically require the
grantee to pay back funds. Non-monetary findings require the grantee to
correct its problems to the satisfaction of the ACF office.
Onsite review teams look at many documents in assessing grantee
performance, including the annual audit. While no one document
necessarily provides all the information needed to fully understand the
fiscal state of any Head Start program, using many documents, plus
using the newly revised fiscal checklist, should provide reviewers with
a full understanding of the financial situation of a Head Start
grantee. ACF will certainly include audit findings as part of its risk
assessment strategy to look holistically at the programmatic and fiscal
health of all Head Start programs.
Question 3. I was pleased to see in your testimony that the Head
Start Bureau and the Administration on Children and Families are
working on a comprehensive risk assessment that will help identify
grantees that have potential fiscal or programmatic problems. However,
it did greatly concern me to read in GAO's report that 838 grantees, or
76 percent of those reviewed using the PRISM system in 2000 were out of
compliance with one or more financial management standards. It
disturbed me even more that 440 or 53 percent of those same grantees
were cited again for fiscal or programmatic problems in the subsequent
2003 review. About half of those grantees were found to have two or
more areas of concern. It is my hope that in creating the comprehensive
risk assessment that the Head Start Bureau and ACF will seriously look
at this problem and come up with viable answers. Do you anticipate that
the new risk assessment will help in reducing the number of repeat
offenders? Also, do you believe that this new assessment will help
grantees find long-term solutions to fiscal management concerns?
Answer 3. ACF anticipates that risk assessment will help in
reducing the number of ``repeat offenders'' in the future. ACF already
has identified the risk factors that we are moving quickly to address.
For example, in the past, Regional Offices often accepted grantee
letters of compliance stating that non-compliances were corrected.
Although there are legitimate situations in which a letter and
corresponding documentation may be sufficient for a Regional Office to
determine that non-compliance has been corrected, there are also many
situations that should be verified through an onsite visit. In fiscal
year 2005, ACF is establishing new policy that reduces the acceptance
of letters of compliance and greatly increases the use of onsite
followup reviews to verify compliance. This will help reduce the number
of repeat findings by assuring, onsite, that all problems have indeed
been corrected.
ACF believes that some repeat non-compliances occur because the
original review team did not establish and report the connection
between a non-compliance and the underlying governance and/or
management systems that should have detected and corrected the non-
compliance as part of their ongoing local oversight responsibilities.
Through training, policy development, and quality assurance ACF will
insist on review teams addressing these interrelationships and making
them known to grantees in monitoring reports so that grantee corrective
action is completed in a way that ensures that changes are long-lasting
and sustainable in fiscal as well as programmatic areas.
Senator Alexander. Ms. Shaul? I guess I should say Dr.
Shaul. Excuse me.
Ms. Shaul. Mr. Chairman and members, thank you for the
opportunity to present the findings of our review on the
financial oversight of the Head Start program by the Department
of Health and Human Services.
As you pointed out, Head Start has provided services to
low-income children for about 40 years, and as both you and Dr.
Horn point out, it is the largest Federal investment in early
childhood education and care. So it is important that this
program is managed so that it ensures that children receive the
services that they do deserve.
With me today are members of the GAO team that worked on
this report.
My remarks today focus on three issues. First, risk
assessment, the extent to which the Administration for Children
and Families, which is the part of HHS that is responsible for
Head Start, connects the information it has to make an
assessment of financial risks. Second, information quality, the
quality of information in ACF's processes. And third,
correcting financial problems, the effectiveness of ACF's
approaches in ensuring that grantees with financial weaknesses
correct their problems.
Let me turn first to risk assessment. ACF does not bring
the information it collects together to comprehensively assess
the financial risks the program faces. We brought a chart over
here which shows a number of individual processes that ACF has
for looking at the program. But instead of integrating this
information, which is collected by several ACF offices, and I
am pointing out on this chart--we have got these colored in
some of the different offices in ACF that have some
responsibility for the Head Start program--instead of
integrating that information, Head Start sometimes relies on ad
hoc responses, for example, in response to calls made to
regional offices about grantee problems or to questions from
Congress. This type of response is useful, but it cannot
substitute for a comprehensive approach to determining where
Head Start faces the greatest risks.
Second, regarding information quality, we found problems
with ACF's processes, and again, I am referring to these
processes in the chart over here. For example, different onsite
teams have had inconsistent findings about the status of the
same grantee. Let me give you another example. The information
provided in ACF's annual surveys is not verified and some
critical information, such as enrollment, has been inaccurately
reported by grantees.
Third, with respect to correcting financial problems, we
found that ACF is not fully effective in ensuring that grantees
correct their financial problems. In 2000, 76 percent of the
grantees ACF reviewed onsite were out of compliance with one or
more financial management standards. And since then, when ACF
did a followup visit, more than half of these grantees still
were not compliant with financial standards.
A small percent of Head Start grantees have a level of
noncompliance that ACF determines deficient, a status that
brings corrective action beyond self-certification. However, we
found that ACF's regional offices did not use common criteria
to determine deficiency. In our review of 20 grantee files that
contain similar financial problems, and where we would have
expected to see similar results, half were deemed deficient and
half were not.
Finally, when ACF finds that a grantee has very serious and
continuing problems that may impair services to children, its
corrective action may be limited. Over the past decade, a
relatively small percentage of grantees have relinquished their
grants or were terminated.
As Dr. Horn pointed out, ACF generally agreed with GAO's
recommendations to strengthen the tools it uses for financial
management. However, ACF disagreed with GAO's interpretation of
its authority to recompete grants. ACF says that it must give
current grantees priority at renewal time, which effectively
eliminates its opportunity to replace grantees then. We believe
that when grantees reapply for their grant, ACF has an
opportunity to change grantees if a grantee fails to fulfill
program and financial requirements. For that reason, we
suggested that the Congress might want to consider clarifying
the circumstances under which ACF can recompete a Head Start
grant.
Mr. Chairman, that concludes my remarks. I would ask that
my full statement be placed in the record and I would be
pleased to answer questions. Thank you very much.
Senator Alexander. Thank you, Dr. Shaul, and thanks to you
and your team for your work at the request of Congress. It is a
great help.
[The prepared statement of Ms. Shaul follows:]
Prepared Statement of Marnie S. Shaul
Mr. Chairman and members of the committee, I am pleased to be here
today to discuss our recent report on oversight of the Head Start
program by the Department of Health and Human Services (HHS). Although
Head Start is a popular program and millions of low-income children
have benefited from the program over the past 40 years, it is important
to ensure that all grantees are held accountable for achieving program
results and properly managing their Federal funds. The reauthorization
of Head Start presents an opportunity to address some of the management
challenges facing the Head Start program.
Head Start is the Federal Government's single largest investment in
early childhood education and care for low-income children. HHS's
Administration for Children and Families (ACF) manages Head Start and
relies on hundreds of different grantees throughout the country to
provide services to more than 900,000 children and their families. Head
Start funding increased three-fold in real terms during the 1990s.
Currently, ACF disburses about $6.8 billion annually to Head Start
grantees. As you can imagine, managing a program of this size, with
this many grantees and beneficiaries, can present many challenges.
My testimony today will focus on how well ACF manages the risks
associated with the Head Start program. Specifically, I will discuss:
(1) ACF's processes to assess financial risks; (2) how those processes
can be improved to ensure the accuracy and reliability of the
information ACF collects on its Head Start grantees; and (3) the
effectiveness of the approaches ACF uses to make sure Head Start
grantees address any financial management weaknesses in a timely
manner.
My written statement is drawn from our recent report on Head Start
risk management, which was completed for the committee in accordance
with generally accepted government auditing standards.\1\
---------------------------------------------------------------------------
\1\ GAO, Head Start, Comprehensive Approach to Identifying and
Addressing Risks Could Help Prevent Grantee Financial Management
Weaknesses, GAO-05-176 (Washington, D.C.: Feb. 28, 2005).
---------------------------------------------------------------------------
In summary, ACF does not have a comprehensive risk assessment
process it can use to collect information on how well grantees are
performing and managing their Federal grant funds. Such an assessment
should be able to provide ACF with the information it needs to target
its oversight activities, reduce the risks inherent in managing a large
Federal grant program, and help prevent grantees from failing
financially, through earlier intervention. While ACF has many processes
it uses to collect information on its grantees, these efforts are
conducted by different organizations within ACF, and ACF does not have
a process in place to systematically bring the information together in
one place to do an assessment of how well the program is operating.
When we looked more closely at ACF's oversight processes, we
identified flaws that limit the quality, accuracy, and reliability of
the information ACF collects on its grantees. For example, ACF does not
have a quality assurance process that could validate the findings of
the reviews it conducts of its grantees at least every 3 years; it does
not verify the accuracy of the data it asks its grantees to submit on
key performance indicators each year; and it does not reconcile a
grantee's actual withdrawals with its reported expenditures until all
of the funds have been spent. These flaws limit the information ACF has
on Head Start grantee's financial status and operations and, as a
result, many program specialists in ACF regional offices that we
visited told us they most frequently learn that a grantee is having
trouble through a call from a parent or teacher reporting a problem.
Program specialists said that such calls were a routine part of their
day-to-day monitoring activities. Over-reliance on this approach to
identifying problems can result in missed opportunities to help
grantees address management challenges before they become problems. As
a result, unchecked problems may worsen. Although infrequent, there
have been cases in which grantees have furloughed employees or
temporarily closed centers--thereby disrupting services to children and
their families--because they spent their grant funds too quickly and
did not adequately manage their grants to ensure that there would be
funds available throughout the school year.
When ACF identified grantees with financial management problems, we
found that it took limited actions to ensure that grantees quickly
corrected their problems and made lasting changes to their programs so
the problems would not surface again. This is a concern because ACF's
data show that more than 76 percent of Head Start programs that were
reviewed in 2000 were out of compliance with financial management
standards, and more than half of these grantees were still out of
compliance during their next review. When we looked at the approach ACF
takes to ensure that grantees correct their problems, we found that ACF
most frequently relies on grantees to self-certify that they have
corrected their problems without ever visiting the grantees for
verification. One of the more aggressive approaches ACF can take to
address longstanding problems is to require the grantee to develop and
implement a quality improvement plan, but first ACF must declare the
grantee ``deficient''--a term it uses to identify grantees with severe
problems. Yet, we noted inconsistencies in the process used by the ACF
regional offices to determine the severity of the problem. As a result,
one grantee could be deemed deficient while another, with similar
problems, would not. We also found that ACF makes limited use of its
authority to terminate its relationship with poorly performing
grantees. ACF does not seek competition for a grant until after the
current grantee has exhausted all its appeals or it has convinced a
poorly performing grantee to voluntarily relinquish its grant. The
process to remove a grantee that fails to perform up to standards is
protracted, and that grantee can continue to receive funds long after
financial management weaknesses have been identified. In the meantime,
the community has no other option for Head Start services and low-
income children may not receive the quality or intensity of services
that they need.
We made a number of recommendations in our report and ACF agreed to
implement many of them. Implementing these recommendations will go a
long way towards ensuring that those responsible for overseeing the
Head Start program and its 1,680 grantees have the information they
need to target oversight resources effectively and reduce the program's
risks. More importantly, however, these improvements should help ACF
prevent grantee financial management weaknesses before the problems
become too severe. We also recommended that ACF make greater use of its
authority to seek competition by taking steps to seek qualified
applicants where the current grantee fails to meet program
requirements. While such a step should be taken after carefully
considering all available options, competition would help to ensure
that children are no longer served by poorly performing grantees.
Ultimately, enforcing all the program's requirements--especially
financial management requirements--strengthens the Federal commitment
to poor children and their families by effectively managing scarce
Federal resources and making sure as many eligible families as possible
can participate in the program.
BACKGROUND
Begun in 1965 as part of the Johnson Administration's War on
Poverty, Head Start offers poor children and their families a range of
services, including preschool education, family support, health
screenings, dental care, and assistance in accessing medical services.
The program may either provide the services directly or facilitate
access to existing services. Eligibility for Head Start is generally
limited to children who are below the age of school entry and from
families with incomes below the Federal poverty level or receiving cash
assistance from the Temporary Assistance for Needy Families program. To
accomplish Head Start's goals for these poor children and families, the
Congress last year provided $6.8 billion in Federal funds, which HHS
awards directly to nearly 1,700 grantees nationwide. As funding for
this longstanding program has grown, so has the risk associated with
any mismanagement of program funds.
While effective oversight of Federal funds is always a guiding
principle in managing the various Federal Government programs,
accounting scandals in the private sector in 2001-02 reinforced the
need for organizations to have stronger financial oversight. Since that
time, both public sector and private sector organizations--including
many not-for-profit organizations--are paying closer attention to
managing the risks in their operations. Indeed, the Office of
Management and Budget (OMB) recently revised its guidance for Federal
Agencies' financial managers to better integrate and coordinate their
risk assessments and other management activities.
The primary goal in managing any Federal program is to provide
reasonable assurance that the program is operating as intended and is
achieving expected outcomes. A key step in the process of providing
this assurance is conducting a risk assessment. A risk assessment is a
comprehensive review and analysis of program operations, especially the
management of Federal funds, to identify risks and to measure the
potential or actual impact of those risks on program operations. The
potential for such risks exist in all Federal grant programs; for
example, the diversion of funds to other purposes, inefficient use of
funds, failure to contribute the grantee's share of funds, or other
problems that reduce the effectiveness with which financial resources
are brought to bear on achieving program goals. When a Federal program
relies heavily on grantees to provide services, as the Head Start
program does, the risk assessment process can become more complex.
Processes must be developed to assess the operations of every grantee
to ensure that each complies with program rules and to measure whether
each achieves expected results.
The Federal Government makes Head Start grants directly to nearly
1,700 local organizations, including community action agencies, school
systems, for-profit and nonprofit organizations, other government
agencies, and tribal governments or associations. Many of these
grantees operate other Federal, State, or local programs in addition to
the Head Start program. Many of these Head Start grantees also provide
services by subcontracting with other organizations, known as delegate
agencies. In 2003, there were about 800 delegates providing services in
the Head Start program. Some grantees had multiple delegate agencies
while others had none. The various layers of grantees, the
administrative complexity of the program, and the interrelationship
between programs operated by the same grantee add to the challenges of
overseeing the Head Start program.
ACF uses a number of processes to collect information on grantee
performance and financial management. Table 1 summarizes ACF key
processes for monitoring Head Start grantees.
Various offices within ACF have roles in developing and
implementing processes to monitor grantee performance and financial
management. (See fig. 1). The Head Start Bureau develops program
policies and designs the program-specific oversight processes to
collect information on grantee performance. Staff from the 10 regional
offices implement the policies developed by the other offices within
ACF, ensure that all grantees are in compliance with program rules, and
frequently develop additional policies to aid in their oversight
responsibilities.
Table 1: ACF's Oversight Processes for Monitoring Grantees' Financial
Management
------------------------------------------------------------------------
Purpose and
Monitoring process Required frequency description
------------------------------------------------------------------------
onsite review (PRISM)........... Triennial......... To determine
whether a grantee
meets standards
established in
the Head Start
Act, including
those related to
financial
management, teams
of Federal staff
and contracted
consultants
conduct a
weeklong, onsite
review using a
structured guide
known as the
Program Review
Instrument for
Systems
Monitoring
(PRISM).
Survey of grantees (PIR)........ Annual............ To provide
management
information to
the Bureau and
policymakers, all
programs
(grantees and
delegates) are
mandated by
Federal
regulations to
submit
performance data,
including key
financial
measures such as
enrollment and
teacher salary
ranges. Grantees
report these data
through a survey
known as the
Program
Information
Report (PIR).
Review of financial reports..... Semiannual........ To account for use
of grant funds,
all grantees must
submit semiannual
reports on the
status and use of
their Federal
funds.
Review of audits................ Annual............ To ensure that
Federal grantees'
financial
statements are
accurate, that
they have
adequate controls
in place to
protect Federal
funds, and that
they are in
compliance with
key regulations,
under the Single
Audit Act all
grantees must
obtain an annual
audit of their
financial
statements and
compliance with
selected Federal
laws and
regulations.
Day-to-day contacts with Variable.......... To assist Head
grantees. Start programs,
program
specialists in
ACF regional
offices respond
to grantee
queries and other
calls from
grantee staff,
parents, and
others with an
interest in their
local Head Start
programs.
Renewal application............. Annual............ To provide
information to
support
determination of
the grantee's
future funding
level, grantees
are required to
submit renewal
applications each
year to the ACF
regional office.
------------------------------------------------------------------------
Source: GAO analysis.
ACF LACKS A COMPREHENSIVE STRATEGY TO ASSESS HEAD START RISKS
ACF uses many processes to collect information on grantee
performance and financial management but does not bring together this
information to comprehensively assess the program's risks or identify
areas where it might need new or improved processes to collect
information. Staff in ACF regional offices maintain day-to-day contact
with the Head Start grantees and monitor the operations of those
grantees throughout the country. Many of those regional office staff
told us that they most frequently learn if a grantee is having a
problem through a call from a parent or a teacher. The staff in the
regional offices said these calls are a routine part of their day-to-
day monitoring activities. Over-reliance on this approach can result in
missed opportunities to help grantees address management challenges
before they become problems. Greater linkages among the various
programs offices and oversight activities could produce a more
comprehensive approach to assessing program risks and help prevent
financial management weaknesses in Head Start grantees. (See fig. 2).
In our review of ACF's management of the Head Start program, we
noted a number of ongoing activities that were not well-integrated and
did not present a comprehensive view of the program's risks. For
example, Head Start's 2004 Management Initiative targeted risks that
were identified in recent GAO reports, news articles, and congressional
inquiries. The Initiative targeted well-known problems such as
underenrollment, overenrollment of children from families that did not
meet income eligibility requirements, and excessive executive
compensation at some Head Start programs. However, efforts to address
broader concerns about program governance--the skills and knowledge of
local Head Start governing boards to effectively manage their
programs--were notably absent from the Initiative.
In another example of an ACF oversight process that is too limited
in scope, we reported that before 2004 ACF had not collected
information it could use to estimate the extent of improper payments
made by grantees or the Head Start Bureau. But when ACF began to
collect this information, the agency focused on just one type of
improper payments to grantees--payments made to grantees that enrolled
too many children from families that did not meet the program's income
eligibility requirements. These improper payments pose a program risk
because eligible children may not have access to services. While this
effort is an important step in systematically assessing risks, the
study overlooked many other possible forms of improper payments, such
as those made to contractors, to grantees that are significantly
underenrolled, or for unallowable program activities.
Finally, we noted in our report that ACF relies on its regional
offices to assess their own operations for gaps that might pose risks
to all ACF programs, including Head Start. Such gaps might include
failure to follow ACF grant management policies or to maintain files on
property acquired or renovated with Head Start funds. Self-assessments
can be an important tool, but ACF had not recently conducted an
independent compliance review to ensure that its own grant policies are
enforced and that the Federal Government's financial interests are
protected.
PROCESSES ACF USES TO COLLECT AND ANALYZE INFORMATION ON GRANTEES ARE
FLAWED
We found that the main processes ACF uses to collect information on
its grantees' financial management--onsite reviews, annual grantee
surveys, and analyses of financial reports and audits--have flaws that
limit the value of the information collected. The onsite review
process, mandated by the Head Start Act and often known as PRISM--the
name of the review protocol--is ACF's main tool to assess whether
grantees are in compliance with statutory and regulatory requirements.
While the Head Start Bureau has made progress in improving its onsite
reviews, we found that problems remain. We found that the Bureau has no
process to ensure that the teams of reviewers follow the Bureau's
guidance. This is a concern because there is evidence that some PRISM
reviewers might not follow the guidance for the onsite reviews. For
example, comparisons of simultaneous onsite reviews of the same
grantees by two different teams--a PRISM review team and an improper
payments study team--revealed significant discrepancies. Notably, 21 of
the 50 grantees in the improper payments study were cited for enrolling
too many children that did not meet the income eligibility guidelines,
but the PRISM review teams cited only 3 of those same grantees for
failing to comply with income eligibility criteria.
The effectiveness of onsite reviews to systematically identify
grantees with financial management weaknesses depends on some assurance
that the onsite review is implemented as designed and that the
reviewers have the necessary skills to assess grantees' compliance with
Head Start performance standards. The review teams are lead by staff
from ACF's regional offices and include a number of reviewers under
contract with Head Start. Many of these contractors are employees of
Head Start programs throughout the country. While this level of
experience should indicate a familiarity with Head Start program
requirements, ACF does not check reviewer credentials or test their
knowledge of the rules before they are sent to conduct reviews. ACF
seeks feedback, on a voluntary basis, on the contractors' performance
but ACF's Director of Regional Operations expressed reluctance to
solicit feedback on the team leaders' performance.
ACF also uses an annual survey of its grantees to collect
information on the status of their programs to measure results, but ACF
does not verify the information collected. We reported last year that
important information, such as enrollment in many Head Start programs,
is often reported inaccurately. Also, our analysis raises concerns
about the reliability of the survey data. ACF relies on 700 checks of
internal consistency to ensure that data are reported accurately. Many
ACF officials said that the checks make it difficult for grantees to
provide inaccurate information. However, our own review of the internal
consistency of the data found problems; as long as grantees complete
the survey consistently, the data--whether accurate or not--would pass
the tests. While ACF officials said they would be able to address the
problems we identified in our analysis, because the data are used
widely by policymakers and the public to assess the program's results,
until ACF takes steps to ensure the accuracy of the database we urge
caution in using data from the survey to monitor Head Start grantees.
All Head Start grantees report on the status of their funds through
periodic financial reporting and annual audits of their financial
statements. We found that ACF made limited use of the information
collected through these two processes to analyze Head Start grantees'
financial status. For example, ACF does not routinely reconcile a
grantee's withdrawals with its reported expenditures until after the
funds have all been spent. It is therefore difficult for ACF to
identify grantees that might be drawing down excess funds at the
beginning of the grant period and risking shortfalls at the end of the
period. Regarding audits, all grantees must obtain an annual audit of
their financial statements and compliance with selected Federal laws
and regulations. These audits are conducted under a framework mandated
by the Single Audit Act. While these audits may not be as comprehensive
as an onsite program review, they are designed to ensure that Federal
grantees' financial statements are accurate, that they have adequate
checks and balances in place to protect Federal funds, and that they
are in compliance with key regulations. However, ACF officials cited
limitations in the scope and timing of the audits for failing to use
them more systematically in their day-to-day oversight activities. In
focusing on the limitations of these audits, ACF officials may overlook
some valuable information on grantees' financial management practices.
ACF DOES NOT ENSURE THAT GRANTEES EFFECTIVELY RESOLVE FINANCIAL
MANAGEMENT PROBLEMS
One way to assess the effectiveness of the approaches ACF uses to
address grantees' financial management weaknesses is to examine whether
grantees resolve their problems and then stay in compliance. ACF's data
from its onsite reviews from 2000-03 show that many grantees that were
cited for failing to comply with financial management requirements in
one review still had problems in their next review. \2\ Our analysis of
the data shows that more than half of the grantees cited for failure to
comply with financial management-related rules were out of compliance
again with one or more financial management standards during their next
review. (See fig. 3).
---------------------------------------------------------------------------
\2\ The data base for onsite reviews, PRISM, contains both grantees
and grantees with any delegate agencies reviewed. The data presented in
this section contains both types of entities. When we analyzed the
grantees separately, we obtained the same results about percentages of
grantees that were non-compliant and had recurrent problems in their
next review.
---------------------------------------------------------------------------
Moreover, the number of areas of financial management in which
grantees were noncompliant did not decrease with subsequent reviews. As
figure 4 shows, of the 70 grantees cited in 2000 for problems in all
three major areas of financial management--fiscal management, program
governance, and record keeping/reporting--69 still had one or more
problems in each area at the next review.
The repeat problems could be a result of failure to correct the
problems in the first place--something that might have been identified
with a follow up review--or an initial correction that did not take
hold. One senior official in a regional office said that many Head
Start grantees will fix a problem identified in the PRISM report in the
short term but fail to make lasting changes to their financial
management systems. For example, a grantee might try to meet financial
reporting deadlines for a few months after being cited by a PRISM
review team for missing deadlines, but if the grantee did not implement
a system to ensure that these reports are consistently on time, the
improved performance may not be sustained.
When grantee problems are identified through onsite reviews or
audits, ACF often relies largely on grantees' self-certification that
they have corrected problems rather than imposing special conditions or
conducting a site visit. While self-certification may be appropriate in
cases when minor problems can be corrected quickly, the analysis in
figure 4 suggests that many grantees with problems are not getting the
help they need to correct their problems and make lasting improvements
in their financial management capabilities. We reviewed the files of 34
grantees with financial management problems identified by ACF during
its onsite reviews. In 18 cases, ACF determined that the grantees'
problems were not severe enough to be deemed deficient--a term ACF uses
to identify grantees with severe problems. Of those 18 grantees ACF
required 16 to submit letters certifying that they had corrected the
problems and no further action was pursued. In the other two cases, ACF
returned to review the grantees and found that they had not corrected
their problems. It was not clear from our file review how ACF
prioritized these two grantees for followup, but in revisiting these
grantees ACF took an aggressive step to ensure compliance. Because the
two grantees had not corrected their problems, as required by law, ACF
deemed them deficient and required them to develop a quality
improvement plan.
ACF also relies primarily on self-certification to resolve problems
identified in grantees annual audits. In each of the 30 audits we
tracked from the date the auditor completed a report identifying
financial weaknesses until the regional office judged the audit
findings resolved, that judgment was based on a letter from the grantee
rather than a site visit or other followup. Regional staff said they
relied on subsequent audits to ensure that such findings are resolved,
but we found it frequently takes up to 2 years from the point an audit
identifies a problem until the regional office receives the next audit,
during which the grantee continues to receive Federal funds. While the
results of our review in four regional offices may not represent the
range of actions taken by all ACF regional offices nationwide, we
interviewed managers in other regional offices who generally described
similar procedures.
To the extent that grantees have recurring financial management
problems, more aggressive approaches might be appropriate. ACF has the
authority to impose special award conditions--such as requiring
grantees to seek approval for every withdrawal of grant funds--but ACF
rarely imposes these conditions. ACF can also make a follow-on visit to
ensure that the grantee has implemented corrective actions and is in
compliance with the program's rules. The Head Start Act requires ACF to
conduct follow-on visits when it determines that a grantee has such
severe problems that it deems the grantee deficient; ACF can also
return to grantees with less severe problems, but we found ACF rarely
does so. We could not discern an objective rationale for when ACF
regional offices decide that a grantee is deficient and when they do
not. For example, reports based on the onsite reviews for 20 of the
grantees we reviewed showed similar problems in the quantity of
violations and the severity of the problems cited, but the regional
offices deemed only 10 of the grantees deficient. Regional office staff
and their managers in the offices we visited said they meet to discuss
any problems identified during the onsite review to determine whether
to deem the grantee deficient, but they said they treat each case
differently and largely base their determinations on their previous
experiences with the grantee.
The most aggressive approach ACF can take to ensure that a
community is served by a Head Start grantee with sound financial
management is to seek a new grantee if the current grantee cannot
perform as expected. However, we found that ACF rarely terminates its
relationships with poorly-performing grantees. Instead, ACF said that,
in lieu of terminating a poorly performing grantee, it will try to
convince such a grantee to voluntarily relinquish its right to its
grant. When ACF does undertake the protracted process of terminating
its relationship with a grantee, the grantee will continue to receive
funding even if it appeals ACF's decision--regardless of the appeal's
merits. Under ACF's current regulations, it must also fund a grantee's
legal costs until the grantee has exhausted its appeals before HHS'
Departmental Appeals Board. According to an Administrative Judge on the
Appeals Board, no other HHS grant program except Head Start allows
grantees to continue receiving funding throughout the appeals process.
When ACF decides to award a grant, the Head Start Act requires that
ACF give priority to grantees already operating a Head Start program in
the community. This aspect of the law provides important continuity for
Head Start services in a community. It also provides important
stability for grantees. However, the act allows the Secretary to deny
priority to any grantee the Secretary finds fails to meet the program's
performance or financial management requirements. Denial of priority
status to current Head Start grantees would open up the possibility of
competition for the grant among other qualified applicants. ACF could
seek a new grantee that can demonstrate the ability to manage Federal
funds responsibly, in accordance with program rules, and that can
provide high-quality Head Start services to eligible children in the
community. Obviously, denying priority status to a grantee that has
been a part of a community for years, has educated multiple generations
of children from that community, and has employed a number of staff
from the community is a major step that should be taken after carefully
considering all available options. But, denial of priority status is a
step that ACF should take if a grantee fails to make the necessary
changes to effectively manage its program. Ultimately, enforcing all
the program's requirements--especially financial management
requirements--is really about strengthening our commitment to future
generations of children, seeking better ways of managing scarce Federal
resources, and making sure that we reach as many eligible families as
possible.
We made 8 recommendations in our report to improve the overall
management of the Head Start program, strengthen the tools ACF uses to
collect useful information on its grantees, and improve ACF's analysis
of the information it collects. Specifically we recommended that the
Assistant Secretary for Children and Families:
Produce a comprehensive risk assessment of the Head Start program
and update it periodically. Such an assessment should:
Consider plans to collect data on and estimate the extent of
improper payments made for unallowable activities, payments to grantees
that are significantly underenrolled, or other unauthorized activities,
Aim to improve the processes ACF currently uses to collect and
analyze information on program risks; for example, ACF should:
Train and/or certify its onsite reviewers to ensure they have
the skills and knowledge necessary to perform their responsibilities,
Develop an objective approach for regional office management to
use in assessing the severity of the problems identified during onsite
reviews and for finding grantees deficient or not, and
Implement a quality assurance process to ensure that the
framework for conducting onsite reviews is implemented as designed,
including holding ACF's regional management accountable for following
this framework and for the quality of the reviews.
Verify key data from the annual survey of grantees to enhance the
usefulness of this data in overseeing its grantees and managing the
program, and
Seek ways to make greater use of the data it collects on the
status and use of Federal funds through a periodic reconciliation of
grantees' reported expenditures with their withdrawals.
Take steps to obtain competition for a grant if ACF has determined
that the current grantee fails to meet program, financial management,
or other requirements. Such a competition could be held without giving
priority to the current grantee.
ACF agreed to implement most of our recommendations. However, ACF
expressed concerns about our last recommendation, suggesting that it
did not have the authority to seek competition from other qualified
applicants for grant funds in communities that are currently served by
poorly performing grantees without first terminating its relationship
with such grantees. Seeking other qualified applicants under these
circumstances would strengthen the linkages between a program's
performance--including financial management--and its funding. Congress
may wish to seek other qualified applicants and clarify the extent of
ACF's authority to deny priority status to grantees it determines fail
to meet program, financial management, and other requirements.
Mr. Chairman, that concludes my prepared statement. At this time, I
would be happy to take any questions you or other committee members may
have.
GAO CONTACT AND STAFF ACKNOWLEDGMENTS
For more information regarding this testimony, please call Marnie
S. Shaul at (202) 512-7215. Individuals making key contributions to
this testimony include Betty Ward-Zukerman, Bill J. Keller, Mark Ward,
and Neal Gottlieb of our Education, Workforce, and Income Security
Team; Kim Brooks, Diane Morris, and Gabrielle Fagan of our Financial
Management and Assurance Team; Curtis Groves of our Applied Research
and Methodology Team; and Richard Burkard and James Rebbe of our
General Counsel.
Response to Questions of Senator Alexander by GAO
Question 1. According to the report, more than half of the grantees
identified as having financial management problems also demonstrated
recurring financial management issues. Even so, the Department of
Health and Human Services has not taken action to deny grant funding to
these programs. What can Congress do to ensure that appropriate action
is taken against grantees with severe and recurring financial
management problems?
Answer 1. While only about 24 percent of the grantees reviewed in
2000 passed their reviews without any findings of non-compliance with
financial management standards, nearly half--about 47 percent--of those
with problems passed their next review with no financial management
problems.
The Head Start Act requires HHS in awarding new Head Start grants
to give priority to current Head Start grantees. We are aware that this
provision is designed to ensure the continuity of high quality programs
and avoid unnecessary and disruptive changes in grantees that serve a
particular community. However, HHS may deny priority to a grantee if it
determines that the grantee fails to meet financial management or
performance standards. In such a situation, HHS may, as we suggested,
choose to conduct a competition which could ultimately result in a new
grantee being selected and the current grantee being terminated. The
Congress may wish to consider amending the current law by providing for
alternative termination procedures and timeframes to minimize
disruption under these circumstances. Congress may also wish to more
explicitly specify the circumstances under which a grantee could
maintain its priority status and the level of failure to meet financial
management or performance standards that would be necessary for a
grantee to be denied priority status.
Question 2. The Senate bill to reauthorize the Head Start program
from the 108th Congress included provisions that would require Head
Start grantees to recompete for those funds periodically. One of the
GAO's recommendations to the Department is to provide the current
grantee with a certain degree of priority over other grantees. How
should Congress help support these efforts to ensure high quality
grantees are able to continue serving children, while still weeding out
less effective or troubled programs?
Answer 2. Our recommendation was based on current law that
generally provides priority to grantees that operate programs that meet
financial management and program requirements. Among those grantees
that were reviewed in 2000, 24 percent met their financial management
requirements and, of those that did not, 47 percent were able to
correct any noncompliances before their next review. Clearly, we do not
want to lose the experience and expertise such providers bring to the
program. On the other hand, of the grantees reviewed in 2000 that had
financial management weaknesses, 53 percent continued to have financial
management problems in subsequent reviews. ACF will need to focus its
oversight resources on these grantees in order to ensure that such
programs can succeed; if no improvements are forthcoming, then ACF may
need to exercise its authority to recompete those grants.
While we did not address the Senate bill to reauthorize the Head
Start program, we generally believe that competition on a level playing
field will result in the consistent selection of high quality grantees
and that a grantee's past experience can and should be an important
factor in these selection decisions.
As noted in our report, if ACF improves the processes it uses to
collect and analyze data on grantee financial management, ACF will be
in a stronger position to link funding opportunities to performance.
Reliable, accurate, and transparent processes are needed in order for
ACF to be effective in separating stronger grantees from poorly
performing grantees.
Question 3. Testimony that will be given later today suggests that
the data used in the report could be improved by separating grantees
into categories based on whether or not they had multiple findings, or
whether the findings were severe or not. Is that data available, and
how might the GAO report be different if the data were reported in this
way?
Answer 3. ACF provided us with its databases summarizing the
results of its onsite reviews for fiscal years 2000-03. The 2000
database contained approximately 1,100 records reflecting reviews done
by ACF in 2000. These records include both grantees and grantees with
any of their delegates. We have run the analysis for both the entire
database and for grantees separately and the results are the same: 76
percent of the grantees had at least one of the three areas with non-
compliance and 53 percent had recurrent problems.
Of the 76 percent that were out of compliance with at least one
financial management standard in 2000:
14 percent were out of compliance with only 1 financial
management standard,
32 percent were out of compliance with 2-5 financial
management standards,
54 percent were out of compliance with 6 or more financial
management standards, and
36 percent were out of compliance with 10 or more
financial management standards.
In both 2000 and 2003, the four standards with which grantees were
most often found out of compliance were:
The requirement to maintain an effective reporting system
to generate reports on grantee financial status and program operations
to advise governing bodies, policy groups, and program staff of program
progress;
The requirement that grantees maintain a recordkeeping
system to provide accurate and timely information regarding children,
family and staff and assure appropriate confidentiality of this
information;
The requirement that the grantee establish procedures
describing how the governing body and the appropriate policy group will
implement shared decisionmaking;
The requirement that each grantee and delegate agency
establish written procedures for resolving internal disputes between
the governing body and the policy group.
In 2000, 13 percent of grantees reviewed were judged deficient
based on financial management standards. However, in our review we
found that ACF did not use common criteria to determine deficiency.
Question 4. The issue of recompetition appears to be the only area
where the Administration on Children and Families suggests they need
Congress to be involved in addressing the suggestions within the
report. Are there additional ways that Congress can improve the
accountability process within the Head Start program, and is there a
role for Congress to play in the other recommendations made by GAO?
Answer 4. All of the recommendations we set forth in our report are
actions that, we believe, ACF can take without seeking further
authorities and ACF has indicated that it intends to act on most of
these recommendations. However, congressional oversight is always
necessary to ensure that Federal Agencies demonstrate continued
commitment to improvements. If asked, we are prepared to assist the
committee to monitor ACF's progress in implementing our
recommendations.
Question 5. As we've heard from Assistant Secretary Horn, the
Administration on Children and Families is committed to strengthening
the Head Start accountability process. He's outlined a number of recent
policies that have been put in place, as well as a number of new
initiatives that will help ensure Head Start program dollars are being
used most effectively. Do you expect that these activities will be
sufficient, and are there additional activities you might suggest?
Answer 5. The steps set forth in Assistant Secretary Horn's
statement should lay a solid foundation to ensure that ACF can do a
better job identifying and addressing the program's risks and
preventing grantee financial management weaknesses. However, continued
monitoring may be necessary.
The Congress may wish to ask ACF to conduct additional systematic
analyses of other types of improper payments in order to provide a
better estimate of program risks. In Assistant Secretary Horn's
statement, he expressed support for looking more carefully and
systematically at the way grantees expend all of their Head Start
funds. However, he did not indicate that ACF would specifically look at
other types of improper payments the same way it reviewed compliance
with the income-eligibility rules in 2004 as we recommended in our
report that HHS should do so. In February, ACF provided technical
comments on a draft of our report and noted that audit reports and
other reviews would be used to identify other possible improper
payments. However, reliance on these oversight tools will not provide
ACF with a systematic way to assess risks associated with other types
of improper payments.
Question 6. In your testimony you stated that the Head Start
program is the only program operated by the Department of Health and
Human Services that allows a grantee to continue grant operation while
appealing the termination of the grant. Could you determine in your
review why this is the case? Are there other Federal programs that
allow this?
Answer 6. Our work did not cover grant conditions in Federal grant
programs in other Federal Agencies. We limited the scope of our work to
the Head Start program specifically and sought supplementary
information from the HHS' Departmental Appeals Board in order to draw
comparisons to other programs under its oversight authority.
Question 7. Also mentioned often in your testimony and in the GAO
report is that regional staff believe they are overworked and have
control over too many grants. How pervasive is this problem? Do you
believe that additional staff at the regional level would help earlier
detect some of the financial and programmatic problems at the grantee
level? Or would additional staff simply add to the Federal bureaucracy
of the program?
Answer 7. We did not assess the human resource capacity in ACF's
regional offices. We did report that regional office program
specialists working with Head Start grantees typically are responsible
for about 12 grantees. According to the Assistant Secretary for
Children and Families' testimony before the committee, ACF fully
supports our recommendation to develop a comprehensive risk assessment
of the Head Start program. Once completed, ACF should be in a position
to make more efficient use of its human resources and better target its
oversight resources to identify financial and program problems at the
grantee level. Additional training for ACF's existing staff is also an
area discussed in the report.
Question 8. It is often stated in the GAO report that ACF rarely
uses the authority it has to recompete a grant if a grantee has been
found deficient. The report also states that deficient grantees are
often given bonus points during renewal, even though ACF is not
required to give priority to a grantee that has failed to meet program,
financial management or other requirements established by an agency. Do
you believe that increased use of this authority would strengthen
current grantees or would it hurt the continuity of the program?
Answer 8. We believe that ACF has the authority to deny priority
status to a grantee that fails to meet program or financial management
requirements--i.e., deficient grantees--when awarding grants and that
ACF should use its authority in order to open up the possibility of
competition for grants to other qualified providers. Denial of priority
status is a major step that should be taken after carefully considering
all available options so as to avoid unnecessary and disruptive changes
in grantees that serve a particular community. However, denial of
priority status is a step ACF should take if a grantee fails to make
the necessary changes to effectively manage its program.
Senator Alexander. And Dr. Horn, thank you. Your comments
will be placed in the record.
Each of us will take 5 minutes, and let me begin with a
more general question. I have some more specific questions, but
I would like to talk about the theory of management and
regulation a little bit.
It seems to me, as we look at how the Federal Government
funds educational activities, we have got two models. One is a
Head Start/higher education model, let us say, and one is the K
through 12 model. Now, what I mean by that is that in higher
education, we have 5,000 or 6,000 entities and we basically
give the money to students. It follows them to the entities and
the entities have great autonomy and we really don't manage--we
don't try to manage the Vanderbilt University and the
University of Tennessee or the community college in California
from Washington. We have accrediting agencies and we have a
very light touch from Washington and that has helped to produce
the greatest system of colleges and universities in the world.
On the other hand, in K through 12, we have a very heavy
touch. We get in and tell everybody what to do and we tell
children where they have to go to school and it is a completely
different model.
Head Start for 40 years has been more like higher
education, it seems to me. We have 1,700 different local
organizations, more or less, to whom the Federal Government
directly gives money. They have a lot of autonomy in what they
do. And there are about 20,000 Head Start centers.
So I am trying to understand, how can we effectively be
good stewards of that money without having too heavy a
management touch from Washington on 20,000 different Head Start
centers which is really impractical? I don't want to see us get
into a situation, for example, where we have a lot of rules
from Washington and a lot of local centers going around filling
out forms and doing small things, and trying to do all the
regulation from here when, in fact, the model is autonomous
local agencies with responsibility for results and Federal
oversight of big financial problems and hopefully some
measurable outcomes.
We will hear a little later on the second panel from Mayor
Wharton of Memphis, who is the mayor of our largest county in
Tennessee. He found a Head Start center that was a mess. More
recently, it has been alleged that the people there were
pilfering from the pension fund as well as other problems. He
is here today because he was prevented from taking charge and
solving the problem by the regulatory system that we have.
So if each of you would help me understand, what would be
the ideal system here? How can we maintain autonomy for these
20,000 centers and 1,700 organizations, and allow the people
working there to focus on the children rather than filling out
forms? I don't want them to become like the Federal Election
Commission, where you spend 10 percent of your time and your
money satisfying lawyers and accountants rather than doing what
you are supposed to be doing. So can you help me with that
general observation?
Dr. Shaul, what is your reaction to that?
Ms. Shaul. The Head Start program is a unique program with
a long history of how it is provided. It does have very high
standards for the kinds of services children are to receive.
I think part of how to give programs flexibility is to have
the results-oriented part. Our work was really about the
financial side, so I am not going to speak much to that, but to
have the results-oriented part for the children with some local
autonomy about how they get there.
But on the financial side, I think it is to do this risk
assessment, to focus your energy on the most important areas,
not to have a really long checklist of things that are of equal
importance but perhaps individually may not be getting to the
absolute most important things, but to really look at what are
the key issues that give you risks in the financial area. Is it
that people aren't paying attention to single audit results or
what are in them, and those kinds of things. So it is creating
some focus rather than treating everything as though it is
equally important.
Senator Alexander. Dr. Horn?
Mr. Horn. I believe that one of the great strengths of the
Head Start program over the years has been the local control. I
think that is very important for us to preserve, the ability of
local programs to design their programs to meet the needs of
their community and that whatever we do, we ought not to unduly
constrain the ability of local programs to design that program
to meet those local needs.
I also want to say that I think that despite our
acknowledgement of weaknesses in our oversight of local
programs, I think most local programs do a good job. I think
that most people who work in Head Start get up every day and
come to the Head Start program and help to fulfill a very
important ideal, that no child should be disadvantaged in their
later education because of the circumstances of their birth. At
the same time, I think that there are two things that are very
legitimate for the Federal Government to do, given that this is
a Federal-to-local grantee administered program.
First of all, I think it is important for us to be able to
assure the American taxpayers that their funds are being used
appropriately and are being used only for the purposes
authorized by Congress and are being used to the maximum extent
possible to benefit the well-being of the kids in the local
programs.
The second thing is that I think we need to do a better job
of managing by results and not just intentions, that we ought
to have a greater focus on whether or not children are, in
fact, progressing developmentally in their local Head Start
programs as opposed to simply making sure that programs fill
out forms accurately.
So there is a nice balancing act here that we have to
continue to strive to achieve. Preserve local control,
recognize most programs are doing a pretty good job, but at the
same time, do a better job of overseeing the fiscal management
of the taxpayers' dollars at the local level and also manage
more by results.
Senator Alexander. Senator Kennedy?
Senator Kennedy. Thank you very much. I appreciate your
answer, and let me say the record ought to show that Marnie
Shaul was nodding at a good part of what you said on these
issues.
I think for those of us who have been strong supporters,
understand that we want this to be run well, run well, the way
that you described it, Mr. Horn, and that it is the local kind
of component so that it is going to take into consideration the
local needs of children, and they vary extensively, as we all
know, and also people that are trying to do a job. These are
challenging jobs that they do and they have got to be equipped
to be able to meet the financial kind of responsibilities, and
how you do that in a way that is nonbureaucratic, as the
chairman has said, but yet requires some skills, some auditing
skills and some requirements and some training programs, and to
be able to do that effectively and have the role of the
regional office.
We want obviously to have some, I think, addressing of
these problems of the under-enrollment. I mean, that is not
good. We want to make sure that these audits are done and done
right and done well.
I like the idea of this recompetition of deficient programs
that we are going to have for those that are deficient. There
are new kinds of opportunities for children in other places and
they are going to try to do it. That sends a very powerful
message to people, too, so people are going to make sure that
theirs doesn't fall in that kind of level. That is very
important.
Just in terms of the training programs, I would like you
just to talk, and maybe Marnie Shaul could talk a little bit.
There was a training program at the Institute for Head Start
Directives on management practices for programs. I would like
you to comment where that is. Does that reach out? Is the
program providing the kind of training that it should? Should
they get more help and assistance, being able to do the job and
do it right? Are they getting that kind of support? I think we
ought to know that. Maybe you could tell us, both whether we
are giving that kind of training from the Head Start program,
whether we are doing that in the regional and whether we do it
at the national, do it enough.
And also, I noticed in the report there were some concerns
about individual Head Start centers. They told the GAO about
the issues on staffing and workload and travel that kept them
from addressing some of the problems that they saw in these
Head Start centers, or in the regional office. Maybe you could
comment on that, if you are familiar with that. I mean, what is
that about?
So I am interested in how much help and assistance. If we
want to get it simplified, we want it nonbureaucratic, we want
accountability. We know that is the way. But, quite frankly,
the people need help and assistance at the local level and
regional level. How much assistance are they getting? Should
they be getting more?
Mr. Horn. We recently revamped the way that we deliver
training and technical assistance to local grantees. In the
past, there has been, in my judgment, too much emphasis on
training via conferences and too little emphasis training
onsite. As a psychologist, I know that, unfortunately, the
research on training suggests that what you are most likely to
do after you go to a training conference is what you did before
you went to the training conference, despite the best
intentions of everybody, both the trainers and those who
attend. The best way to get actual behavior change is to work
onsite, hands on, to provide guided practice and mentoring and
then do a lot of followup to ensure that the changes are being
maintained.
And so what we have done within the Training Technical
Assistance Network is we are shifting to a more local grantee
focus, where we have specialists in each of the regional
offices and their job is to work directly with each of the
local grantees to encourage more of this local training. So if
there are difficulties with fiscal management, for example, the
best thing is not to send somebody off to a conference to learn
about fiscal management. The best thing is to send someone who
knows something about fiscal management into the local program,
review the way they are doing things, make suggestions for
improvement, and then go back a number of times to ensure that
those changes are being made.
So I do believe that we have had not as great as success as
I would like to see in training local programs to ensure they
have the skills to be able to manage these programs most
effectively. Again, I hasten to add, that is not to say that
most programs are not being managed effectively. I think they
are. But the problem is that we have to ensure that all the
programs are being managed effectively and we think this more
locally-based T&TA structure will go a long way to helping do
that.
Senator Kennedy. Could you make a comment?
Ms. Shaul. One of the things that we saw, Senator, when we
saw grantees with problems, when we reviewed the files, was
that oftentimes that was because they had difficulty in
maintaining a financial officer who knew how to do things. And
so I think the kind of onsite training that you are talking
about is important.
I want to add, though, that I think the training of the
PRISM reviewers, too, to be sure that they are able to see
things on the ground when they get there is another training
element that I believe is important and that you are working
toward, as well.
Senator Kennedy. Thank you, Mr. Chairman.
Senator Alexander. Thank you, Senator Kennedy.
Senator Enzi?
The Chairman. Thank you, Mr. Chairman.
Assistant Secretary Horn, I appreciate the effort on the
report and your testimony. In your testimony, you listed five
areas that you believe Congress and the administration should
work together on the reauthorization. Could you comment briefly
on each of those five areas and give us a little bit more
detail for the record, briefly summarize what you think
Congress should do?
Mr. Horn. Let me turn to that page to remind me of those
five specifically.
Well, the first recommendation is that we believe that
Congress should find ways to increase the involvement of States
in the administration of the Head Start program, particularly
when it comes to coordination of Head Start with pre-K programs
and their child care programs directed at preschool children.
As has been pointed out at this hearing, back in 1965, there
were no States that had a state-run and state-financed pre-K
program. Today, there are 40 States or more that do so.
Does it really make sense to have two systems grow up
parallel with each other and not well coordinated? I think the
answer is no and the President thinks the answer is no. He
thinks that we ought to find ways to better coordinate the
State pre-K efforts with Head Start because when they are not
coordinated well, it creates inefficiencies and can lead to
under-enrollment problems.
Second, we think that Congress should provide the Secretary
with greater discretion in the use of Head Start dollars,
particularly related to the current 2 percent set-aside when it
comes to training and technical assistance. As you know, the
current statute says that 2 percent of the total budget shall
be reserved for training and technical assistance, and for some
years, that may be a reasonable amount. It is a lot of money.
It is about $160, $165 million. But for other years, it may be
too much, and why hamstring the Secretary's discretion when in
any given year, we may make the choice to add more children to
the program as opposed to spending an exact prescribed amount
of money on training and technical assistance.
We would also like greater flexibility in the makeup of the
monitoring teams that we send out on the PRISM reviews. Right
now, the statute--and let me read the section that I am talking
about here. The statute, 641(c)(2), Conduct of Reviews, and
subpart (c) under that says that the makeup of the reviewers
shall be conducted by review teams that shall include
individuals who are knowledgeable about the Head Start programs
and to the maximum extent practicable the diverse needs of
eligible children.
Well, we think the most important thing for the reviewers
is not necessarily--I mean, they should know something about
Head Start, but they should really know something about the
area that they are reviewing. There is no requirement in the
statute, for example, for fiscal reviewers to be experts in
fiscal management issues. If you have--under the statute, the
current statute, have a choice between someone who is expert in
fiscal management and somebody who knows a lot about Head
Start, the statute compels us to pick the latter, not the
former. Does that really make sense? It seems to me that what
we ought to do is change the statute to make it clear that what
we want are reviewers with the expertise in the areas that they
are reviewing.
The last thing I would say, because I know I am talking a
lot here, has to do with our ability to replace deficient
grantees. There are two relevant statutes in this regard. The
first is Section 641(a)(2), and what this requires is that the
Secretary shall give priority to the designation of Head Start
agencies to any local public or private nonprofit or for-profit
agency which is receiving funds under any Head Start program.
Now, there are some exceptions in terms of if they are not
meeting certain performance standards.
But if you cross-reference that with Section 646(a)(3)--I
am giving these numbers for the record. I don't imagine
everyone is following those numbers. But what it says is, it
says that under this objective, a financial system shall not be
terminated or reduced and an application for funding shall not
be denied, and a suspension for financial assistance shall not
be continued for longer than 30 days unless the recipient has
been afforded reasonable notice and opportunity for full and
fair hearing.
This is kind of unique when it comes to Federal grants
management. In most cases, when we find a grantee is doing
something deficient, we can move in and defund them and then we
sort it out through the appeals process. The current statute
does not allow us to do that in the Head Start program, and as
you know, appeals can last a long time. At a minimum--at a
minimum, and that is assuming that the hearing at the appeals
level is only 1 day--it requires 240 days for us to go through
the process, and sometimes the appeals hearing can last months,
if not, in some cases, years.
That section prevents us from moving in and defunding that
grantee. So we would appreciate some greater flexibility under
the statute to actually protect the taxpayers' money during the
appeals process.
The Chairman. As an accountant, I love this detail stuff--
[laughter]--and I have some followups on it, but I will have to
do that and request those in writing. I have some additional
questions that I will do for you, too, but they are all
detailed like that, but they are very important information for
us to get in order for us to be able to do a good job drafting
legislation, so I will appreciate your answers to them.
My time has expired. Thank you.
Senator Alexander. Senator Murray?
Senator Murray. Thank you, Mr. Chairman.
Let me follow up on that, because there seems to be some
discrepancy between what GAO says you have authority on and
what you think you have authority on. Ms. Shaul, can you tell
us what authority you think ACF has to recompete these
programs?
Ms. Shaul. Based on our review, we believe that the agency
has the ability to say that a grantee does not have priority
status at renewal time if it is not meeting the program or
financial standards.
Senator Murray. So you believe they have the authority to
do that right now, but----
Ms. Shaul. That was our conclusion.
Senator Murray [continuing]. I believe that Mr. Horn just
said he doesn't think they do.
Ms. Shaul. That was a disagreement. Mr. Horn--Dr. Horn--
agreed with all of the recommendations in our report,
basically, with the exception of this area where there seems to
be some lack of clarity and where I think both of us have
suggested that it would be helpful for the Congress to make
clearer the circumstances.
Senator Murray. Well, let me follow up on Senator Kennedy's
question, as well. Mr. Horn, you talked about what can be done
to help these programs that do have some fiscal management
problems, going in and working with the programs and following
up. How much of that is done today?
Mr. Horn. Not as much as we should. That is the honest
answer.
Senator Murray. And what is precluding that from happening?
I mean, it is one thing to say to a program, you have got
fiscal management problems and then to go back the next year
and say, you have got fiscal management problems, and another
thing to say, it is our responsibility to give you the training
and assistance you need to be able to meet the goals we have
set out for you. So what is the obstacle from making it happen?
Mr. Horn. First of all, you have to know there is a problem
before you can solve it, and so what we have been trying to do
over the last 12 months is to implement systems so that we can
identify fiscal problems before they become huge problems. One
of the ways we have done that is by putting into our PRISM
reviews a series of red flags when it comes to fiscal issues
that would require that we go back and do a more indepth look
at what is going on at the grantee level.
For example, one of the questions is, has the grantee
borrowed money within the last 12 months? That could show some
difficulty with cash management. Have vendor payments been
late? Again, it could be issues with cash management. Has the
amount of cash reported on the balance sheet decreased over the
past 3 years, and so forth? These are red flags that were put
into the PRISM reviews that we require----
Senator Murray. Are those in place now so that----
Mr. Horn [continuing]. They are in place now, yes.
Senator Murray. OK.
Mr. Horn. The other thing that just recently has come to my
attention, and we will do a better job of this, is taking a
look at the financial statements that come to us on an every 6
months basis from local grantees to ensure that if we see
substantial drawdowns or changes in drawdowns over the course
of time, that we go back to the grantee and talk to them about
that, because the goal--a goal of reviews, in my view, should
never be just ``gotcha.'' What they should be is they should be
reviews that are designed to help to improve the program.
Senator Murray. OK. So in my understanding, are you saying
since you know these challenges are there for a few of the
programs, you are now reviewing that more consistently and you
are flagging that and sending out to these programs some help--
--
Mr. Horn. Exactly.
Senator Murray [continuing]. Is that not correct?
Mr. Horn. Yes.
Senator Murray. So I would assume that a year from now, 2
years from now, you would come back with better numbers from
some of our programs?
Mr. Horn. I would hope that would be true, yes.
Senator Murray. Without any changes, correct? Do you have
the ability to do it now, I assume?
Mr. Horn. Well, again, there are certain things we don't
have, in our judgment, the ability to do, such as, for example,
we do have a disagreement with the GAO as to whether or not we
are able to recompete grants when we find a grantee deficient
during the appeals process, which I said can last in some cases
years. And again, this is unique in the Federal management of
grants----
Senator Murray. Right. But I understand, also, that one of
the problems is ways to identify accurately those programs that
do have problems so that we are not taking corrective action on
programs arbitrarily.
Mr. Horn [continuing]. Well, we should never take
corrective action on programs arbitrarily, but if I understand
your point, I agree with it, which is this. The goal of reviews
is not to defund grantees.
Senator Murray. Right.
Mr. Horn. The goal of reviews is to try to have the maximum
number of quality programs as possible. And so I don't think
that we should be judged--the Federal Government should be
judged by if we defunded 50 grantees this year and only 25 last
year, we did twice as good.
Senator Murray. OK. But one of the things, if we are going
to change authority and give you more authority to recompete
programs, we had better make sure there are really accurate
identifiers in place so that it is not discriminately targeting
programs, but it is based on accurate information which we
don't currently have.
Mr. Horn. I am always in favor of accurate information.
Senator Murray. Ms. Shaul, would you agree?
Ms. Shaul. Yes. One of our recommendations was, in fact,
that how grantees are determined to be deficient be very clear,
not only from the standpoint of the agency, but so that also
grantees know exactly what those circumstances are, that the
standards be clear and transparent to everyone.
Senator Murray. And I am hearing you say that is not
currently the case?
Ms. Shaul. When we reviewed files in the field, we looked
at 20 files where we had grantees that looked in the file
review to have similar numbers of financial problems, similar
types of financial problems, similar program governance
problems, and yet half of the grantees were determined
deficient and half were not. We would have expected pretty
similar outcomes, whatever the outcome was, for all 20 of those
files. So I would say that there is not a--has not been a
consistent standard.
Mr. Horn. And if I may add one thing, Senator, we are
concerned about inconsistencies across the regions, and that is
one of the reasons why this year we are implementing for the
first time a system of re-reviews of a sample of reviews that
have been done over the course of the year by specially-trained
reviewers who go in and basically will act as calibrators
across the various regions to make sure that each of them are
reviewing the same information and coming to the same--you
know, in the same way and coming to the same conclusion. So we
share the concern about the issue and we are taking steps to
try to deal with it.
Senator Murray. I think that is really important, because
Head Start programs out there are struggling with a lot of
different challenges--kids who are coming really needy to their
programs, parents that are struggling, all kinds of things, and
they want to do a good job. But if we have different ways of
evaluating different programs, then we are just going to send
these programs of Head Start into nightmares of trying to do
all kinds of forms rather than doing what we want them to do,
which is to make sure kids get the best possible start.
Thank you, Mr. Chairman.
Senator Alexander. Thank you, Senator Murray.
Our ranking member of our subcommittee, Senator Dodd?
Senator Dodd. Thank you very much, Mr. Chairman. I
apologize to my colleagues and others for arriving a bit late.
I have two new young ones, and one with a high fever this
morning. I am learning the joys of parenthood at this stage, so
I apologize for arriving late.
Senator Alexander. We call those field hearings.
Senator Dodd. Yes. [Laughter.] You know, having written a
lot of these laws as a single person, I am beginning to
appreciate the effect of my efforts here now.
[Laughter.]
Well, thank you very much, and thank you, Mr. Chairman, for
doing this. This is very worthwhile and tremendously helpful
and important and I want to thank GAO for their work. I am
always impressed with the work that the Government
Accountability Office does, and certainly it can be very
helpful in all of this, too.
I would ask, Mr. Chairman, unanimous consent that some
opening comments be included in the record.
Senator Alexander. Without objection.
[The prepared statement of Senator Dodd follows:]
Opening Statement of Senator Dodd
Mr. Chairman, I'm pleased to join you in holding this
hearing today. I know we share a common goal that our Nation's
poorest children have access to a high quality preschool
program.
Of course, Head Start is much more than a preschool
program, offering comprehensive services to 900,000 children
throughout the country. I often refer to Head Start as a
stealth health program because without Head Start, hundreds of
thousands of poor children each year would not receive the
health care, dental care, vision screening, and screenings for
potential developmental delays that the program provides to
help poor children enter school ready to succeed.
As we all know, the children that participate in Head Start
enter with great deficiencies compared to their counterparts
who are better off financially. That's why it is so important
that Head Start programs remain the gold standard for early
learning and preschool.
The Government Accountability Office has found some
troubling breakdowns within the monitoring system for
overseeing Head Start programs. I welcome GAO's recommendations
and look forward to working with GAO and the Administration for
Children and Families to ensure that both Head Start programs
and the monitoring system designed to help guide and oversee
their operation work as intended.
Head Start has a more comprehensive, extensive monitoring
system than any other preschool or pre-kindergarten program in
the Nation. That's by design, a system that has evolved over
the years as the science about early learning has grown matched
only by our desire to ensure that each Head Start program meets
the quality performance standards, which have evolved over the
years as well.
When I look at the number of monitoring tools available
within the Head Start oversight process, it is clear that the
monitoring tools are in place. But, somehow, both at the Head
Start grantee level and within HHS, the tools have become just
another check-off item in the process.
I suspect that local Board governance and oversight is a
problem for grantees with serious or chronic problems. It seems
to me that with the extensive monitoring system that applies to
Head Start, potentially stronger local Boards could pick up on
problems in the self-assessment, the monthly financials, and
the annual audits.
I know that the PRISM review is comprehensive, it has
nearly 1,800 program requirements, including 573 requirements
in fiscal management alone. And, it speaks to the quality of
the monitoring system that such a comprehensive review occurs
onsite for every Head Start grantee every 3 years. But, that
review represents the back-end of the monitoring system in my
view.
We need to figure out a way to strengthen Board training,
management, oversight, and systems review on the front-end as
the first step in program governance and program oversight.
This is a role for HHS, not one where HHS should say ``go find
your own training.'' The local Boards need to be actively
engaged in each program and knowledgeable about program rules.
No Head Start agency begins the day asking what program
violations can they commit today? I am hopeful that this
hearing will offer many recommendations to further strengthen
Head Start as we begin drafting reauthorization legislation in
the weeks ahead. We need to reform the monitoring system so
that it serves as a management tool, not a check-off list of
items that is ignored upon completion. If we invest in
appropriate training on the front-end, including management and
systems training, we will have stronger programs and better
outcomes for children.
Senator Dodd. Let me, if I can, I would like to focus, if I
could, on what I consider to be sort of the absence of some
real management tools, if I can, Mr. Horn, with the kind of
review we are looking at here. Let me sort of state, if I can,
my concerns here about this approach.
I don't think that boards of these Head Start centers begin
the day by saying to themselves, ``I wonder what violations we
can commit today?'' I work off the presumption, and I assume
you do, that these are very good, very talented, committed
people who believe that Head Start makes a significant
contribution, and it seems to me it is in our common interest,
then, to try and do what we can to strengthen these boards.
My concern basically comes down to this, and that is
whether or not we are putting enough emphasis on the front end
of this process rather than the back-end of the process,
whether or not we are providing these boards with the kind of
management skills and tools that they can conduct the kind of
reviews of how these centers are being run rather than sort of
waiting at the end of the process and going in with an 1,800--
look at the size of this thing. I mean, it is a huge thing,
these PRISMs, that go in and go back and review this. It seems
to me you can--catching the violation.
If we are truly interested in making Head Start work, then
we ought to be doing what we can to see to it that these
institutions have the tools necessary. Why don't we put up, if
you want, that chart there on these management tools. I know
you are familiar with all of these, but it seems to me it is
important to look at it.
So I begin on that presumption. I presume you do, as well--
--
Mr. Horn. Yes.
Senator Dodd [continuing]. That these people are not out to
somehow violate the law, but rather want to do a good job and
the question is, can HHS provide them with the necessary tools
to make it possible for them to do a better job so we minimize
the very things that the Government Accountability Office has
encountered in their review, and that is really the essence of
my question for you, I suppose.
When I look at the number of tools available within the
Head Start oversight process, it is clear that the monitoring
tools are in place, as you see them here. These are the
management tools, and those are pretty good tools, and pretty
comprehensive, because I was reading them last night, going
back over them. They are rather significant. But somehow, both
at the Head Start grantee level and within the HHS, the tools
have become just another checkoff system in the process. Has
the annual self-assessment been done? Check. Have the monthly
financial reports been given to the board? Check. Did the
financial audit get completed? Check.
What I would like to know from Dr. Shaul at GAO is how many
of the violations are related to the operation of the local
grantee boards, for instance? We can get to the answer in a
minute, if you would. I expect that board governance and
oversight is a problem for grantees with serious or chronic
problems.
And for Dr. Horn, while I appreciate your testimony today
about the reforms that you are making, frankly, when I looked
at your Head Start management initiative, I didn't see anything
in it with regard to the board training, board management,
board oversight, and systems review by the boards. So it seems
to me that with the extensive monitoring system that applies to
Head Start, potentially stronger boards could pick up on the
problems in the self-assessment, the monthly financials and the
annual audits, rather than just going and saying they have been
done and checking them off, but rather really getting into
them.
The review, in my opinion, represents--what we are looking
at here, the PRISM review, while it is comprehensive, but that
is the review, in my opinion, that represents the back end of
the monitoring system. What steps could HHS take to provide
management assistance and program oversight assistance to the
boards themselves is what I am getting at here.
So that is really my question to both of you. Why don't we
begin with you, Dr. Shaul, and how many of these problems did
you encounter as I raised here related to the operation of the
local grantee boards?
Ms. Shaul. Senator, when we looked at the kinds of issues
that came up most often with grantees, they turned out to be
areas of program governance, just what you suggested that they
might be. It is things like not having systems in place so that
the agency would generate the kinds of reports on finances and
program results that would allow the board to have--to know
what is going on at the agency on a regular basis and be able
to provide guidance to the executive director and the staff.
The Federal Government can do the systems approach, but the
day-to-day oversight of the agency really is the board's
responsibility, and so they are very, very key.
And some of our other examples of problems that we saw in
grantees that we mentioned in our report, what we sometimes saw
was poor communication between the board and the executive
director, the board not knowing what was going on with the
audits, and so on. So in those situations, it happens that
grantees can get off track when the board doesn't have the
information it needs to provide the oversight. So you have
identified a very key element.
Senator Dodd. And to you, Mr. Horn, then why don't we do
this? If we are truly interested--if you begin with the
assumption that people aren't getting up in the morning on
these things and saying, ``I wonder what violations we can
commit today,'' but rather, ``How can we do a better job?''
wouldn't it make some sense to really provide that kind of
assistance?
And I know you are providing some money already. I am
anticipating a response to this will be some of the resources
you are putting into that. But as I looked over the amount of
money, a one-time $3,000 grant to boards, presumably to
purchase their own training somewhere, or that you once
provided satellite video to boards, it seems to me we might
want to revisit a sampling of Head Start grantees to do an
additional PRISM, which may or may not be necessary, but it may
fit into this process a little more in a more worthwhile way.
What is your answer to that?
Mr. Horn. Well, first of all, may I say for the record I do
agree with you that people do not get up every day and wonder
what kind of violations----
Senator Dodd. I should have acknowledged your head was
nodding affirmatively when I said that.
Mr. Horn [continuing]. And governance of any nonprofit is
really critical to the effective functioning of that
organization, and that is particularly true in Head Start
because there is a unique piece of the governance structure in
Head Start, which is the Parent Policy Council. One of the
things that I think is so extraordinary about Head Start and I
think is very, very well worth preserving no matter what
reforms we do is the idea that parents themselves should be in
the majority status when it comes to the Parent Policy Council
and that that is a way to ensure that parents have input into
the program and that the program reflects the needs and desires
of the parents of the children being served.
The problem, however, or maybe not a problem, but the
challenge is that means that we are dealing with probably some
governance boards which are not very sophisticated initially
and that puts a special obligation, it seems to me, on the
Federal managers to ensure that we build in that sophistication
and that expertise in the Parent Policy Councils, in
particular. That is why last year we did dedicate about $6.7
million in supplemental funding to local programs to do
training in terms of governance.
It is also one of the reasons why we have restructured our
Training and Technical Assistance System to be more local
program based and focused as opposed to focused to a large
extent on conference training. And what we are doing is with
the Training and Technical Assistance Specialists assigned to
each of the local programs is we are trying to figure out what
are their most compelling needs. And I agree with you that one
of the most compelling needs of many programs may be better
training in a governance system.
So we hope--this is a new system that is really focused on
local programs and getting the training done at the local
program level as opposed to a distance learning. But I am
hopeful that that will help us strengthen the governance
structures within local programs.
Senator Dodd. That is a good point, but actually, we need
to do both. I mean, I think the boards and the policy councils,
it is not an exclusivity here. They both need the help. And it
seems to me particularly, since the boards themselves are the
governing body, in a sense, that to the extent we can take some
of these scarce resources, and they are scarce and I appreciate
that. You don't have unlimited resources. But rather than, as I
mentioned earlier, sort of revisiting a sampling of these Head
Starts, to take those resources and put them into training, so
if you are the new board, here is what your obligations are,
here is what your responsibilities are, and early on, we get
them involved.
I am assuming, again, a good board wants to know what is
going on and wants to be able to make the kind of corrections,
be an effective board, my point being it seems to me that would
make more sense than coming in after the fact, as we have done
here and as Dr. Shaul, I think, agrees with me in a sense from
your comments there, to really put the emphasis on the front
end, at least as much on the front end as we do on the back end
of the process. Do you agree with that?
Mr. Horn. Yes, I do. Look, it is always better to prevent a
problem from beginning in the first place than trying to cure a
problem. It is cheaper for everybody and the kids are going to
be far better off when problems are prevented from happening.
I think we need to do both. We need to do a better job of
up-front training and we also need to do a better job of our
oversight of the way that the programs are actually being
implemented. But in terms of poor training, I think that is a
very critical issue and I take your recommendation quite
seriously.
Senator Dodd. Maybe, Mr. Chairman, we might take a look at
that at some point, maybe just even have a witness or two come
and give us some ideas of how we might strengthen that aspect
of this.
But again, I thank GAO and I thank the chairman for doing
this today. Thank you very much for coming.
Senator Alexander. Those are very constructive suggestions
and this has been very helpful testimony, Dr. Horn and Dr.
Shaul. Thank you for your work.
Senator Alexander. We will now invite the second panel to
come to the table. While they are doing that, I will introduce
them, to save a little time. As we discussed with them before,
we have your statements and either have read or will read them.
We will ask each of the witnesses, who will be introduced in
just a moment, if you could summarize your comments in 5
minutes or less, and that will give the Senators--we will try
to restrain the Senators to 5 minutes, as well--that will give
us a chance to ask more questions and to have a better, more
indepth discussion.
I will introduce two of the witnesses and then I am going
to ask Senator Dodd if he would like to introduce Olivia
Golden. Would you like to do that? And then Senator Roberts is
coming over to introduce Dr. Caccamo.
The two witnesses that I will introduce: first, it gives me
great pleasure to present A.C. Wharton, who is the Mayor of
Shelby County. Shelby County surrounds Memphis. It is our
largest county in Tennessee and A.C. Wharton is one of our most
distinguished public servants. He has been the Shelby County
Public Defender. He has been Chairman of the Tennessee Higher
Education Commission.
He is a law professor, a pioneer in a great many areas, and
he is invited here today because he has been for the last 3
years tackling problems with the Head Start grantee in Shelby
County. And while we have been hearing in this first set of
panels the difficulties in managing and controlling and, if
necessary, defunding a grantee as between Washington and the
grantee, I hope we will hear from Mayor Wharton and from others
on this panel what it is like to try to take control of a local
agency that is having problems.
I would like to also introduce Yvonne Atkinson Gates, who
is a County Commissioner from Clark County in Nevada. Senator
Ensign strongly recommended that we hear your story, Ms. Gates.
She attended Clark County High School, graduated from the
University of Nevada-Las Vegas in 1978 with a Bachelor's degree
in political science and journalism, and has a distinguished
career locally. We welcome you and thank you for coming such a
long distance to let us hear from you.
Senator Roberts is here. Senator Roberts, would you like to
make an introduction, and then we will go to Senator Dodd.
Senator Roberts. I certainly would, Mr. Chairman. I
apologize for the lateness of my arrival, but we were
discussing some intelligence matters with some of our allies in
the Intelligence Committee, and it was a good meeting. I don't
want to alarm anybody.
[Laughter.]
Mr. Chairman and members of the committee, I am honored to
introduce Dr. Jim Caccamo, a true expert and an advocate in the
field of early learning. I am pleased that the doctor is here
with us today to discuss the past and current financial
management of a Kansas City Head Start grantee and his thoughts
on what steps could have been taken to avoid the financial
problems which are becoming more egregious and a big press item
out in our part of the world and I think through all the Head
Start world and pose a great challenge to us.
The doctor is a respected leader in the greater Kansas City
area for his work and his dedication to early childhood issues.
He has an extensive background in early childhood, ranging from
his work as an Assistant Superintendent for Special Programs
for the Independence, Missouri School District to his work as
the Director of the Metropolitan Council on Early Learning. The
council is a highly respected organization which specializes in
metropolitan planning for early learning for the bi-state
Kansas City region. The vision of the council is that all
children will enter school prepared for success. They work with
an extensive network of community partners from the public and
private sector to develop and implement an early learning
system that supports families and prepares children for success
in school.
It is also important to note the good doctor's past work as
Executive Director for the Partnership with Children. That
partnership is a Kansas City-based organization whose mission
is to work on a collaborative basis to protect and improve the
quality of life for children and youth through research,
through education, through mobilization and capacity building.
The partnership is now known for its annual report cards, which
actually measure the status of children in a variety of areas
in the five-county metropolitan area.
The doctor also spearheaded the Number One Question
campaign, an effort the organization launched back in 1997. The
Number One Question campaign encourages everyone in their
communities to ask the question, is it good for the children?
So before making any decision, ask the question that should be
asked. Now, this is a cause which I proudly championed here in
the Senate a few years ago with the National Association of
Child Care Resource and Referral Agencies.
As you can gather from his credentials, it is no secret
that the doctor is a dedicated and passionate leader in early
childhood issues. I am confident his testimony will provide
great insight into the Head Start financial situation, which is
very egregious in Kansas City, and also provide positive steps
we need to take to ensure a similar situation does not occur in
the future.
Doctor, I thank you for taking the time out of your busy
schedule to be here today. I look forward to your testimony,
and I thank my colleagues for their patience, and thank you,
Mr. Chairman.
Senator Alexander. Thank you, Senator Roberts.
Senator Dodd, would you like to introduce Dr. Golden, and
then we will go down the line.
Senator Dodd. I would be honored to introduce Dr. Golden.
Truth in advertising, I am a fan of Dr. Golden's. This is a
remarkable individual, Mr. Chairman, who has made, really
dedicated a substantial part of her professional life to these
very, very issues and today is the Senior Fellow at the Urban
Institute.
Many of my colleagues may recall actually working with Dr.
Golden in the past. She has served recently, prior to the Urban
Institute, as the Director of Child and Family Services
Agencies here in the District of Columbia, leading that agency
out of receivership, I might add, into a solvent condition, and
I congratulate you on that.
And then Dr. Golden, previous to that, served in two
Presidentially-appointed positions within the U.S. Department
of Health and Human Services, first as the Commissioner for
Children, Youth, and Families, and then as the Assistant
Secretary for Children and Families. In those roles, she was
responsible for over 60 Federal programs, including Head Start;
Early Head Start, which was created during her tenure to extend
benefits to Head Start to babies and toddlers age 0 to 3
Federal child care programs, which I was deeply involved in
with Senator Hatch in drafting initial legislation in that
area; child abuse and neglect programs, including the
implementation of the Adoption and Safe Families Act of 1997.
She was also Director of Programs and Policy for the
Children's Defense Fund, a lecturer at the Kennedy School at
Harvard, and Budget Director for the Executive Office of Human
Services in the Commonwealth of Massachusetts. She is an author
on poor children and welfare reform, just an extensive
background, very, very knowledgeable and tremendously helpful
to have as a part of any discussion about Head Start.
I didn't get a chance at the opening of my comments just to
State what I said. Head Start is--obviously, every program
deserves to be looked at and we need to address issues that can
emerge from it, but I am a strong believer that Head Start has
made such a tremendous positive difference in people's lives,
and we take some parochial pride in that the author of Head
Start, of course, is a Connecticut resident and a long-time
friend of mine who advocated the program of Head Start back, I
guess about 40 years ago now. So we take particular interest in
the program and how we can sustain it and strengthen it in the
coming years.
So again, I thank the chairman for having this hearing, and
Dr. Golden, it is truly an honor to see you once again and have
you before us.
Senator Alexander. Now that we have introduced the members
of the panel, we welcome Senator Clinton, as well.
Why don't we go on to the 5 minutes of summarized testimony
and then we Senators will plunge in with some questions. Why
don't we start with Jim Caccamo and go right down the line with
the Mayor, then Yvonne Gates, then Olivia Golden.
STATEMENTS OF JIM CACCAMO, DIRECTOR, METROPOLITAN COUNCIL ON
EARLY LEARNING, KANSAS CITY, MO; A.C. WHARTON, MAYOR, SHELBY
COUNTY, MEMPHIS, TN; YVONNE GATES, DIRECTOR FOR MARKETING AND
COMMUNITY RELATIONS, CENTER FOR ACADEMIC ENRICHMENT AND
OUTREACH, CLARK COUNTY, NV; AND OLIVIA A. GOLDEN, SENIOR
FELLOW, URBAN INSTITUTE
Mr. Caccamo. Thank you, Mr. Chairman and members of the
committee, for allowing me to be here today to testify.
One of the early adopters of the Number One Question
campaign in Kansas City was KCMC Head Start. Using the Number
One Question, each and every program was reviewed and, where
necessary, changes were made so that they could say, yes, Head
Start is good for the children. For over 3 decades, Head Start
has delivered high-quality comprehensive services to children
and families. The KCMC executive director devoted his 27-year
career to developing innovative approaches to educating young
children and supporting their families. Through his leadership,
KCMC reaches over 2,700 children and their families annually.
His strong sense of importance for early childhood helped
engage the private philanthropic community to make sizeable
contributions toward continued program improvement in both Head
Start, but in the broader early childhood area within our
community. It is ironic that such a solid agency
programmatically experienced such financial and governance
mismanagement.
The financial and governance mismanagement problems began
to surface 4 years ago. The controller and chief financial
officer was engaged in a kickback scheme and in February 2002
plead guilty to bribery and money laundering. He is currently
serving a 51-month sentence in prison and was ordered to pay
$800,000 in restitution.
In March of 2002, Kansas City, Missouri School District
began trying to collect payments of approximately $1.5 million
for Head Start services they provided. These serious problems
should have caused intensive scrutiny and supervision of all
financial and governance practices at KCMC, but clearly,
whatever interventions occurred were not sufficient.
In October 2003, some 18 months after learning of the
controller's abuse, the Kansas City Star reported on the KCMC
board's paying the executive director an excessive salary.
Revelations about fiscal mismanagement continued to unfold, and
in February 2004, the executive director resigned. And in
December of 2004, the agency gave up the Head Start grant. It
is estimated that KCMC is as much as $3 million in debt.
The financial mismanagement, excessive salary, employee
kickback problems could have been avoided with tighter
oversight on the part of the board and the executive director.
Since last winter, the Community Development Institute in
Denver, Colorado has run the Head Start program. The programs
for children and families served by the agency remain strong,
without noticeable interruption in service, throughout this
period.
There is strong community interest in seeing that Head
Start continues to be a flagship program. Our best community
organizations have come together to talk about responding to
the RFP when it is published. Our community will respond with a
strong application that reflects our commitment to quality,
comprehensive services to children and families and to ensuring
strong fiscal management. Fiscal and governance problems that
occurred at KCMC have been identified, and local experts are
responding to the RFP, are trying to put together careful
attention to ensuring these issues do not happen again.
All of us who care deeply about supporting low-income
children and their families during these early years must
ensure that the Head Start monitoring process helps programs
provide the best possible support to children and families.
I have participated in Head Start reviews over my career
and found them to be rigorous and thorough. In fact, it seems
to me that Head Start reviews are more complex and rigorous
than many of the other program reviews with which I have taken
part. Clearly, these reviews are necessary and the GAO's
recommendations seem appropriate.
In KCMC's case, rules and regulations were in place, but we
must be committed to having all financial aspects closely
attended to by the board and the director. I believe that there
are some additional steps that could be taken, and let me
outline them for you.
First, board membership should include community members
from the delegate agency and school board members from one or
more of the contracting school districts.
Two, increased involvement in board program and fiscal
accountability with closer review in monitoring the budget,
ensuring that payments are made in a timely manner, and that
each budget year is closed out using only current fiscal year
money.
Three, insistence that delegates and subcontractors notify
the executive director and treasurer of the board in writing
when payment for services is more than 60 days in arrears, and
notification of the executive director, treasurer of the board,
and regional ACF office if those payments are 90 days in
arrears.
Internal controls on financial transactions, such as
procurement, accounts payable, payroll, expense reimbursement,
must be strengthened and fiscal review must attest that the
agency is following all of ACF's financial regulations.
And last, staff development for senior management and the
board of directors should be required, including a review of
ACF's budget practices, budget planning, and ethical
leadership.
Ensuring that financial and governance problems don't occur
is a matter of ethics, integrity, accountability, and active
engagement of the board of directors.
In conclusion, I want to thank the committee for their
focus on helping to improve one of our national treasures. For
almost 40 years, Head Start has served our Nation's low-income
children and their families to help ensure their physical and
emotional health and to prepare these children to be successful
in school. Head Start has made a difference to millions of our
children. Strict rules and regulations are necessary, but
communities must also assure that their local Head Start
programs are doing the best possible job fiscally and in
governance. In Kansas City, we believe that Head Start is good
for the children. Thank you.
[The prepared statement of Mr. Caccamo follows:]
Prepared Statement of James M. Caccamo, Ph.D.
Mr. Chairman and members of the committee, thank you for allowing
me the opportunity to testify this morning.
Introduction
For the past 34 years I have been actively working to improve the
status of children in Metropolitan Kansas City. My name is Jim Caccamo
and I am the director of the Mid America Regional Council's
Metropolitan Council on Early Learning.
For our young children and their families, the words of Rogers and
Hammerstein's song from the musical Oklahoma, couldn't be truer,
``everything's up to date in Kansas City.'' Over the past dozen years,
our community has worked hard to improve early learning with the vision
that every child will begin school ready to learn. Civic, business, and
philanthropic leaders have formed partnerships with many agencies and
organizations to promote the well-being of our children.
Eight years ago, Kansas City began a campaign to help focus our
community's attention to the well being of our children. We asked every
citizen to use what we called Kansas City's #1 Question--Is it good for
the children?--as a guide for making decisions at home, in schools, in
the workplace, in places of worship, and in their neighborhoods.
One of the early adopters of the #1 Question Campaign was KCMC--
Head Start. Using the #1 Question as a guide, each and every program
was reviewed and, where necessary, changes were made so that they could
answer ``yes''--it is good for the children.
For over 3 decades Head Start has delivered high quality
comprehensive services. KCMC's Executive Director devoted his 27-year
career to the enhancement and development of innovative approaches to
educating our young children and supporting their families. Through his
leadership KCMC reaches over 2,700 children and their families
annually. His strong sense of the importance of early childhood helped
engage our private philanthropic community to make sizable
contributions toward continued program improvement in both Head Start
and the broader early childhood community. Understanding the value of
Head Start's comprehensive approach to children and families, there has
been and continues to be extremely strong community support for Head
Start in Kansas City.
KCMC delivered outstanding care to young children. The agency
stressed quality in every programmatic aspect of its Head Start program
and was a leader in ensuring that its sites moved toward accreditation
by the National Association for the Education of Young Children.
It is so ironic that such a solid agency programmatically, still
experienced financial and governance mismanagement.
What Happened in Kansas City?
The financial and governance problems at KCMC began to surface 4
years ago, in April 2001. The Controller/Chief Financial Officer was
engaged in a kickback scheme and in February of 2002, pled guilty to
bribery and money laundering. He was sentenced to 51 months in prison
and ordered to pay over $800,000.
In March of 2002, the Kansas City Missouri School District began
trying to collect the delinquent payments of approximately 1\1/2\
milliom dollars from KCMC for operating Head Start programs.
These serious problems should have caused significant and intensive
scrutiny and supervision of all financial and governance practices at
KCMC.
But clearly, whatever interventions occurred were not sufficient.
In October 2003, some 18 months after learning of the comptroller's
abuses, the Kansas City Star reported that the KCMC Board was paying
the Executive Director an excessive salary. Revelations about fiscal
mismanagement continued to unfold. In February of 2004, KCMC's
Executive Director resigned. In December of 2004, the agency gave up
the Head Start grant. It is estimated that KCMC is as much as 3 million
dollars in debt.
The fiscal mismanagement, excessive salaries, and the employee
kickback problems could have been avoided with tighter oversight on the
part of the Executive Director and Board.
Since last winter, the Community Development Institute in Denver
Colorado has been running the Head Start program. During all of this,
the programs and services for children and families served by the
agency continued to be strong without a noticeable interruption in
services.
There is a strong community interest in seeing that Head Start
continues to be one of our ``flagship'' programs. The very best of our
community organizations have come together to talk about responding to
the RFP that will soon be published. Our community will respond to the
RFP with a strong application that reflects our commitment to quality
comprehensive services for children and their families and to ensuring
strong fiscal management.
The financial and governance problems that occurred at KCMC have
been identified and local experts who are working on responding to the
RFP are bringing particular attention to ensuring that these issues do
not reoccur.
Kansas City has been driven by a strong vision that all children
will start kindergarten ready to learn. We are committed to continue to
provide the strong early education experiences that our children need.
What Steps Could Have Been Taken That Could Have Avoided the Situation
in the First Place?
All of us who care so deeply about supporting low-income children
and their families during these early years must come together to
ensure that the Head Start monitoring process helps programs to provide
the best possible support for children and families.
The Government Accountability Office's recommendations to improve
program oversight and financial management seem appropriate.
I have participated in Head Start reviews over my career and found
them to be rigorous and thorough. In fact, it seems to me that the Head
Start reviews are more complex and rigorous than any other program
reviews with which I am familiar. Clearly, these reviews are necessary
and as I said the GAO's recommendations seem appropriate.
In KCMC's case, rules and regulations were in place. But, we must
be committed to having all financial aspects closely attended to by the
Board and the Executive Director.
I believe that there are additional steps that can be taken at the
community level. These include but are not limited to:
1. Increased Board membership to include community members such as
a member from a delegate agency and a school board member from one of
the contracting school districts.
2. Increased involvement of the Board in program and fiscal
accountability with closer review and monitoring of the budget,
ensuring that payments are made in a timely manner, and ensuring that
each budget year is closed out so that the current fiscal year's bills
are not paid with next fiscal year's dollars.
3. Insistence that delegates and subcontractors notify the
executive director and treasurer of the Board, in writing, when payment
for services is more than 60 days in arrears. They should also be
instructed to notify the executive director, treasurer of the Board,
the regional office of ACF if payments are over 90 days in arrears.
These red flags, if they occur, should be enough for ACF fiscal
oversight to become very engaged.
4. Internal controls on financial transactions such as procurement,
accounts payable, payroll, and expense reimbursement, must be
strengthened and fiscal review must attest to the agency's following
all of the financial regulations of ACF.
5. Staff development for the senior management and the Board of
Directors should be required. This development should include a review
of ACF's budget practices, budget planning, and ethical leadership.
Ensuring that financial and governance problems don't occur is a
matter of ethics, integrity, accountability, and active engagement of
the Board of directors.
Conclusion
In conclusion, I want to thank the committee for their focus on
helping to improve one of our national treasures. For almost 40 years,
Head Start has served our Nation's low-income children and their
families to help ensure their physical and emotional health and to
prepare the children to be successful in school. Head Start has made a
difference for millions of children.
Please keep in mind that strict rules and regulations are necessary
but communities must also be committed to ensuring that their local
Head Start programs are doing the best possible job for children and
families.
In Kansas City, we believe that Head Start is good for the
children. Thank you.
Senator Alexander. Thank you, Dr. Caccamo, and Mayor
Wharton, welcome.
Mayor Wharton. Thank you and good morning, Mr. Chairman. I
can only echo what Dr. Caccamo said with respect to the Kansas
City program. I noted in my written testimony that while the
GAO's report is well, as far as it goes, as indicated by the
previous testimony, I think it would be presented in a vacuum
if we did not go all the way down to the delegate agency level.
The problem is not so much how we detect wrongdoing but what we
are able to do about it once we detect it.
I agree fully with the premise of Senator Dodd's question
to the effect that, or observation to the effect that most
employees do not get up in the morning thinking of what kind of
wrongdoing they can engage in. Out of the 800 or so employees
we have down in the Shelby County Head Start program, I know
that that is correct.
However, there were a few members on the board who did, in
my opinion, wake up each morning and see what kind of excesses
they could become involved in. And even when we detected those
wrongful activities, the hoops we had to go through were
unbelievable. Now, I have a legal services background. I have
worked with boards. I am a former public defender. I have no
problem with the shared governance concept.
I do believe, however, that there are certain areas in
which we need a bit more direct control at the grantee level,
specifically the business side--buying gasoline, buying trucks,
signing contracts. I, quite frankly, don't believe most of the
parents I come in contact with wish to serve on a policy
council to deal with where you buy your gasoline or where you
buy your insurance. They want to make sure that during the day,
when their little children are there, that there is a caring,
educated, trained caregiver, teacher, whatever, aide, whatever,
who is going to make sure that that child is progressing as he
or she should and that any deficiencies that child might
exhibit at an early age are corrected in the most effective
manner.
If you will look at the areas in which most of the excesses
took place, they were not in how well the children were
actually cared for. They were in these other areas of business.
One thing I would suggest is that we remove from that area of
shared governance those strictly financial and business
decisions. Yes, parents ought to have a direct say-so in what
their child is taught, what challenges they face to encourage
them to be ready to learn when they reach our schools. If we
could simply pull back a part from the parental involvement
aspect of it, those are the business decisions. That is where
they get into trouble.
But even again, after we identified the deficiencies there,
it is virtually impossible to do anything. The delegate
agencies have a right to continue operating, and guess what,
they have a right to continue spending the money to fight you
as you try to straighten it out. I believe in due process. But
in these instances where we have programs being literally
imploded in front of us, we lose so much respect for the public
that it is impossible for us to regain the credit that the
community has to give us if Head Start is going to continue to
be an effective program.
Mr. Chairman, I heard you mention the higher education
model in which Congress does not get involved in the day-to-day
affairs of a given college or university. That is correct. But
you do, from the standpoint of whether a student is making
satisfactory educational progress. If they are not, then that
college or university has clear and direct authority to say,
you will not come back next September, or if you come back, you
will not get financial assistance, and it is precise. It is
exact. We need to be certain with respect to Head Start.
I, again, emphasize the fact that this is not to assail
shared governance. But keep in mind, in many instances, you
have your policy committee, you have your policy council, and
in my case, I had a county commission. So while I was able to
tangibly see what was going wrong, it took me almost a year to
correct it. And even then, I had to take a page out of your
book, Mr. Chairman, when you were sworn in as Governor down
there when your predecessor was selling the pardons down there
and you had to go in early. I didn't know whether I had the
authority to do it or not. I basically pulled the financial
operation physically and literally into my Finance Office. I
had the books there. That is the only way we straightened it
out now. Had I had to go through the policy council, that never
would have happened.
One final observation, if I might. In many of our
communities where the Head Start programs operate, a Head Start
program is political gold. You build a lot of influence. If you
take a powerful Head Start policy council, they can go head-to-
head with an elected official any day. Again, please do not
confuse any of this with the idea or the suggestion that
parents should not be involved. But in certain areas that are
ripe for political interference, that are ripe for graft and
the other things that we are seeing, I think we need to pull
those out of the shared governance model and hold us all
strictly accountable for those financial and business matters.
I will be more than glad to respond to any questions later
on.
[The prepared statement of Mayor Wharton follows:]
Prepared Statement of the Honorable A.C. Wharton, Jr.
During my campaign for the office of Mayor of Shelby County,
Tennessee, I stressed that my first three priorities would be
education, education, and education. By that statement I was attempting
to project that a sound education was the bedrock of any progress
Shelby County might make. By ``education'' I include preschool
exposures that will ensure all children are ready to learn upon
entering kindergarten, and that their families receive the appropriate
assistance in developing support tools to help their children thrive.
Based upon that philosophy, upon taking office in September 2002, I
first set my intentions to make an inquiry about Shelby County's
troubled Head Start operation. News reports often chronicled the
difficulties within Shelby County's largest delegate agency, an entity
known as Head Start, Inc.
Shelby County Government was and is the official grantee for all
Head Start funds. As Mayor of Shelby County, I believed I had full
authority over the program, and I knew I had a moral obligation to
ensure that it was adequately serving the children and families in my
community.
Drawing on my background as a trial lawyer, I poured through,
literally, many feet of files, investigative reports, and assessments.
Additionally, many concerned citizens beat a path to my door to tell me
of the troubles of Head Start. After thoroughly researching the issues
and listening to the concerns of citizens, I had a clear vision of the
immediate and long-term changes required for us to have a successful,
stable and well managed Head Start program in Shelby County.
What I could not anticipate was how the political realities,
created largely by the obstructive albeit well-intentioned governance
structure for Head Start, would prevent swift and decisive action.
I was elected with 62 percent of the vote, due in large part to the
fact that I had bipartisan endorsement. My support base crossed all
racial, demographic, and political lines. Given this broad support, I
assumed that when I set out to correct what I believed to be obvious
deficiencies in this most critical program, I would be able to
accomplish the task. Unfortunately, I found that my motivations were
questioned and that it was not going to be the efficient task it should
be.
As a defense lawyer, I am well respectful of the due process rights
our Constitution accords our citizens. I feel, however, that the
hurdles I had to face in ridding Shelby County of an ineffective, and
perhaps illegally operated program, went far beyond our founding
fathers' notion of due process.
With this in mind, it is my belief that all Head Start grantees,
such as Shelby County Government, should upon receipt of their grant or
as a condition of receipt of their grant, be allowed to develop a local
governance and operations program that determines how best to select
delegate agencies and how to terminate those contracts efficiently when
needed. Once this due process program is approved, it should rest
solely with the grantee to determine when a contract is to be
terminated. The role of the Federal Government should be simply to
ensure that the grantee has complied with its due process plan it
submitted to HHS and which has been approved by HHS. The best interest
of the intended recipients of Head Start programs should be the focus
of any due process review.
While I understand and support the provisions of the policies that
set forth the parameters for the policy councils' authority, my
experience is that the resulting practice serves to delay and
overcomplicate the termination process. The broad and expansive role
given to the policy committees adds other areas in which delay occurs.
Additionally, in the case of Shelby County, a vote of the Shelby County
Commission was required. With each member of this body being elected by
the public, there obviously is room for much political interference.
It is my opinion that our present Head Start scheme is one in which
process has trumped product. Head Start was designed as a compensatory
education project for culturally deprived children. The purpose was to
ensure that these children receive services and attention that would
prepare them to be ready to learn once they enter school.
Because of the complicated procedural regulations, more time is
given to ``the process'' of running the Head Start programs, and all of
the attendant politics, than is given to the intended product, namely
well cared for, and well taught children, ready to learn when they
enter school.
Nothing herein should be construed to mean that governments or any
other grantee should be allowed to ride roughshod over the dignity that
should be accorded all participants and Head Start programs whether
they are grantees, policy councils, policy committees, or certainly
children and parents. What I do feel emphatically is that the pendulum
has swung too far in an effort to correct the excesses that accompanied
the origin of our many War on Poverty programs in which those from the
outside came in and professed to know what was best for the service
recipients, giving them no voice, but only imposing on them their
designs for a greater society. We need to pull the pendulum back to a
middle ground which gives the appropriate respect to the desired end of
participant involvement while at the same time not bogging down the
programs with procedural hoops that detract from the overall goals of
the Head Start program.
Again, I wish to emphasize that in my legal services experience, I
worked closely with citizen boards. I have also worked closely with
citizen boards in many other civic programs. I emphasize that because I
want to make it clear that this is not a call for eliminating policy
committees and policy councils. I do feel, however, that the role of
the policy councils in such areas as the selection or termination of
delegate agencies should be reviewed carefully. As it now stands,
regardless of the severity of mismanagement within a delegate agency,
the grantee, in this case Shelby County Government, faces unnecessary
barriers in bringing about an immediate termination of the delegate
agency contract, creating a feeling of hopelessness that ultimately
weakens the entire program.
In order to understand the seriousness of this dilemma, one must
understand the down to earth politics which often accompany Head Start
programs. Many of the parents who are on the policy council may feel
somehow indebted to those who operate the program. In many instances,
their children are attending various Head Start programs, and they have
been accorded a level of dignity and respect which they have never
received before. The operators of delegate agencies are often
politically well fixed because they provide a substantial number of
jobs in the community.
What we're faced with is not merely a benign situation in which an
errant agency through no bad intent runs afoul of the guidelines. In
many instances the wrongdoings and shortfalls are calculated to bring
about the political empowerment or financial enrichment of those who
profit from the wrongdoing.
The GAO report focuses on financial management. Based upon my
personal observations and experience, this report and its
recommendations will stand in a vacuum if the governance problems are
not also considered. Head Start grantees cannot correct financial
mismanagement at the delegate level if they face obstruction by the
politics of an unnecessarily complicated governance structure. Without
the authority to quickly access records or take appropriate action on
personnel issues when mismanagement has been identified, Head Start
grantees cannot safeguard the financial security of this country's most
effective and proven program to support at risk children and families.
In an article entitled ``Life Way After Head Start,'' the New York
Times Magazine chronicled the research findings of the High Scope Perry
Preschool--the precursor to Head Start--over the course of more than 4
decades. Looking at the school participants and non-participants side
by side, the results are nothing less than staggering. Considering a
variety of factors from social service requirements to wealth creation,
the analysis suggests a return on investment of 17:1 for the Perry
Preschool. The need to ensure Head Start's success goes beyond a moral
obligation and has implications for our country's future prosperity. We
should not allow any policy or practice to stand in the way of ensuring
this program's success.
Response to Question of Senator Alexander by Mayor A.C. Wharton
Question. You made reference to the GAO recommendations and the
effects you believe they will have on ensuring program accountability.
You have also made specific additional recommendations that would focus
on the local level, either the grantee or local governments. How do you
see Congress supporting the efforts of communities and organizations
like yours to implement the recommendations made by the GAO?
Answer. While the statutory preference accorded existing grantees
should remain, there should be exceptions carved out in those instances
where there is clear evidence of financial impropriety. Similarly,
local governments serving as grantees should also have the authority to
move much more expeditiously in terminating contractual arrangements
with delegate agencies in whose operations there is clear evidence of
financial impropriety or irregularity.
Specifically, the shared governance provisions which call for
policy council approval of the termination of delegate agency contracts
or employees of delegate agencies should be modified to allow the
immediate suspension or termination of such agencies or employees with
any due process provisions to take place promptly following the adverse
action.
I would also suggest that the extent of due process to be accorded
any employee or agency should be tailored by the grantee, and once
approved by the Administration for Children and Families (ACF) as a
part of the grant agreement, it should be final and binding.
Clarification is also needed in defining exactly who or what body
is the ``grantee.'' In Shelby County, Tennessee, for example, the
Office of Shelby County Mayor and the Shelby County Commission are
listed as grantees. Accordingly, the executive branch may find itself
in disagreement with the local legislative body or a significant number
of members thereof, thereby creating the possibility of gridlock when
it comes to terminating failing employees or agencies.
Senator Alexander. Thank you, Mayor Wharton, and thank you
for coming here today.
Senator Ensign, would you like to introduce Yvonne Gates?
Senator Ensign. Thank you, Mr. Chairman, I would. I welcome
one of our esteemed County Commissioners to the panel and
before this committee. She is a terrific public servant in
Southern Nevada, former Chairman of the Clark County Commission
and a person who represents most of the areas that take
advantage of the Head Start program. She has been very active
on these programs including, the oversight and pointing out a
lot of the problems that we have had with our Head Start
grantee. We have worked with Commissioner Gates on many
occasions and are jointly working together to try to come up
with some solutions that will make a big difference and
actually serve kids instead of, as the Mayor was just talking
about, serve the particular interest of individuals feathering
their own nests.
So I welcome Commissioner Gates here and look forward to
her testimony, I look forward to working with you, Mr. Chairman
in the future on trying to fix the problems that we have going
on in Southern Nevada.
Senator Alexander. Thank you, Senator Ensign.
Commissioner Gates?
Ms. Gates. Thank you, Mr. Chairman and members of the
committee. Good morning. I am Yvonne Atkinson Gates and I am a
County Commissioner representing 8,000 square miles. It is
almost as large as the State of New Jersey. I wish to thank
Senator Ensign for inviting me here to appear before you today.
Clark County's population is now over 1.5 million and we
have 118,782 children under the age of 5. Unfortunately, 22,468
of that total includes children living in poverty. As a growing
community, Las Vegas attracts many immigrants who are
interested in developing a better way for their families and
for their lives. Like many cities in the southern part, many of
those newcomers, however, are poor and have language barriers
where English is not their native tongue.
Presently, our school system has a majority of the students
of a minority background. As such, it faces a dual challenge of
assimilating many of these students into the American culture
while at the same time addressing many of their limited English
language skills. No Child Left Behind is more than an
educational mantra, but rather a larger goal of our society. We
believe that Head Start programs, with this focus on the youth
and their families, is a key tool in providing the necessary
foundation for their lives. Children coming from these poor
families need additional compensatory education. We believe
that the sooner we begin this process, the greater likelihood
is that the children will experience future successes.
Children are society's greatest resources, as they
represent our future and our collective hope for a better
world. The promise of the Head Start program is to erase
inequities among our citizens and to give all of our children
an opportunity and a level playing field in achieving their
academic achievements.
In my community, a Head Start provider is a Community
Action Agency and has been funded to enroll approximately 1,723
children providing Head Start at 15 sites. As a local elected
official, I have worked with my colleagues on the County
Commission, the Clark County School District, the City of Las
Vegas, Henderson nonprofit agencies, and faith-based groups to
build state-of-the-art Head Start programs and early childhood
development centers in our community.
I have provided you with a review and a short package
showing several of these centers, which were funded by
community partners using Federal Community Block Grant funds,
city and county general funds, private loans, and land
contribution and long-term leases. Included in this packet are
also several personal testimonies about the importance of Head
Start programs and its participants as well as their families.
With the growth of the Federal budget deficit, we must
identify new ways to enhance program accountability to serve
our community service development system. Our goal should be to
reward and enhance performers toward specific goals rather than
the continuance of funding Head Start providers who are unable
to document their successes.
I wish to commend the GAO Accounting Office for their
recent review of the Head Start program. Their insight relating
to the weaknesses of the Federal oversight process can help us
together build a stronger Federal and local review system so
that these Federal programs can achieve its promise of
preparing our children for their future. This GAO study seems
to indicate that much of the weakness of this program occurs at
the Federal level, where inadequate Federal monitoring and
oversight, combined with the lack of clear and sufficient
sanctions allows the continuation of funding for Head Start
providers who continue to come up short.
To improve in oversight, the Administration for Children
and Families, ACF, needs to be given the support and the
necessary staff resources to take a more proactive role. ACF
needs to engage in more direct intervention to assist
substandard performers achieve targeted benchmarks, levels, and
in cases such as a lack of performance, to take the necessary
hard step in closing and providing opportunities for others to
utilize these resources rather than to keep funding a poor
current performer.
We need to recognize that should Head Start programs be
defunct by ACF, it will create a critical and immediate
community challenge as ACF and others will need to seek new
providers to continue the operation of these programs so that
the children and their families are not negatively impacted by
the program service interruption, recognizing that these
provider relationships may have been forged over decades.
Identifying and selecting new providers will take time and must
be acknowledged that breaking up is hard to do.
To diversify program delivery, Congress may wish to
consider restricting and prohibiting the ACF from allocating
all of its Head Start funding to one organization in a single
large metropolitan area. Utilizing multiple agencies can
provide an immediate back-up should a current grantee no longer
be able to effectively deliver the service.
Our goal should be to expand local oversight of the chosen
grantee. I know as a County Commissioner that my office
frequently has received and fielded calls from disgruntled
parents who think that we have a direct resolve in their issue
with the Federal Head Start grantee as they do not recognize
that the Federal local grant does not flow through the county.
We believe that local government needs to be more actively
engaged in the local review and evaluation process for the use
of these Federal programs. Local government is closer to the
people and we have an opportunity to provide technical and
mentoring assistance to our local nonprofit partners, and
additionally to help provide other resources to expand the
scope of service for the operation of these programs.
As shown in my handout, Mr. Chairman and members of the
committee, a number of the Head Start and early childhood
development centers were a direct result of local funding
commitment to this Federal program reflecting a keen awareness
of the importance that preschool education can make a
difference for our children.
Additionally, the Federal Government may wish to require
Head Start grantees to work with local governments and
potentially require local government oversight review in an
annual review process. As the grant manger for other Federal
funds, State agencies are also uniquely qualified to serve in
this facilitory role as they currently supervise and administer
many other Federal grants, including the Department of Health
and Human Services.
In assisting this reform initiative as part of the
reauthorization of Head Start programs, we must be careful not
to overreact to this GAO study and to use it as an exercise to
terminate or reduce Federal funding for this critical human
development program because of its current weakness shared by
both the Federal and local level. Our children are too
important to this Nation's future to be caught up in Federal
deficit reduction efforts.
As fundamentally as their future successes are critical to
our Nation's competitiveness on the world stage, where other
countries have discriminated toward its citizens due to gender,
Americans continue to be a shining light in the heel of all of
our citizens have an opportunity to succeed based on their
ability and hard work. This is the meritocracy envisioned by
Thomas Jefferson, where people's ability would be only limited
to their ultimate life successes rather than preconditioned
race, sex, or economic status.
Senator Alexander. Ms. Gates, if we could wrap up in about
one----
Ms. Gates. I am. I am just finishing, Mr. Chairman.
Senator Alexander [continuing]. Thank you.
Ms. Gates. Let us work together to build a Head Start
program, achieve its original promise as a compensatory
educational program to help our most vulnerable and youngest
Americans and their families achieve the Jeffersonian
meritocracy.
Thank you, Mr. Chairman and members of the committee.
[The prepared statement of Ms. Gates follows:]
Prepared Statement of Yvonne Atkinson Gates
Mr. Chairman, and members of the committee, good morning, my name
is Yvonne Atkinson Gates, and I am a Clark County Commissioner
representing an 8,000 square mile area as large as the State of New
Jersey, located in southernmost part of the State of Nevada. Clark
County is also the home of the City of Las Vegas, a world renown
tourist destination and Nellis Air Force Base, one of the key fighter
pilot training facilities for the defenders of the free world.
I wish to thank Senator John Ensign for inviting me and giving me
the opportunity of appearing before you today to talk about the
importance of the Head Start Program to our community.
Clark County's population is now over 1.5 million and we have
118,782 children under the age of 5 years of age. Unfortunately, 22,468
of that total include children who come from poverty households. As a
booming growth community, Las Vegas attracts many immigrants who are
interested in developing a better life for their families. Like many
cities in the southwest, many of those newcomers are, however, poor and
have a language barrier where English is not their native tongue.
Presently, our school district has a majority of students from minority
backgrounds. As such, it faces the dual challenge of assimilating many
of these students into American cultural life while at the same time
addressing, for many, their limited English language skills.
``No Child Left Behind'' is more than an educational mantra, but
rather the larger goal of our society. We believe that the Head Start
program with its focus on the youth and their families is a key tool in
providing the necessary foundation for their life success. Children
coming from these poor families need additional compensatory education.
We believe that the sooner we begin this process, the greater
likelihood that these children will more quickly assimilate into
American society.
Children are every society's greatest resource, as they represent
our future and our collective hope for a better world. The promise of
the Head Start Program is to erase inequities among our citizens and to
give our children, all our children, a level playing field for their
future academic success.
In my community, our current Head Start provider is a community
action program agency and it has a funded enrollment of 1,723 children,
providing Head Start services at 15 sites. This Head Start program is a
key lifeline for these children as 804 children have no health
insurance and 511 children are receiving dental care and 1,532 have
received preventative dental care.
As a County Commissioner, I have worked with my colleagues on the
County Commission, the Clark County School District, and the Cities of
Las Vegas and Henderson, nonprofit agencies, and the faith based
nonprofits to help build state-of-the-art Head Start/Early Childhood
Development Centers in our community. I have provided for your review a
short package showing several of these centers which were funded by our
community partners using Federal Community Development Block Grant
funds, County and City General Funds, private loans, and land
contributions and long term leases. Included in this package are also
several personal testimonies about the importance of the Head Start
programs to program participants and their families.
With the growth in the Federal budget deficit, we must identify new
ways to enhance program accountability of our service delivery systems
to ensure that our children, and their families, receive top value for
the investment of our tax dollars in their pre-development education.
Our goal should be to reward and enhance performance toward specified
goals, rather than continuance of funding to Head Start providers
unable to document their successes.
I wish to commend the United States Government Accountability
Office for their recent review of the Head Start Program. Their
insights relating to the weaknesses of the Federal oversight process
can help us together to build a stronger Federal and local review
system so that this Federal program can achieve its promise of
preparing our children for their future lives of promise and
achievement in what is an ever diverse and competitive world
environment.
This GAO study seems to indicate that much of the weakness of this
program occurs at the Federal level, where inadequate Federal
monitoring oversight combined with the lack of clear and sufficient
sanctions allows the continuation of funding to Head Start providers
who continue to come up short. This GAO study provides a unique
opportunity for the Federal Government to get its own house in order.
While clear weaknesses have been identified relating to the 1,700 Head
Start grantees nationwide, this Federal report gives us a unique
opportunity to step back and develop new systems to measure
accountability and to better control the administration of Federal
funds at both the Federal and local levels.
To improve this Federal oversight, the Administration for Children
and Families (ACF) needs to be given the support and the necessary
staff resources to take a more proactive role. Rather than letting
program problems continue to fester, ACF needs to engage in more direct
intervention efforts to assist substandard performers achieve the
targeted benchmark levels, and in cases of continued lack of
performance, to take the hard steps of closing and providing
opportunities for others to utilize these funds rather than continue,
by inertia, to keep funding the current poor performers.
As part of this reform effort, the Federal Government may wish to
re-think how Federal funds should be disbursed to run this important
program. As an alternative to the current Federal grantor/local
nonprofit agency grant recipient relationship, we would propose that
this funding relationship be modified whereby State and local
governments potentially be selected to serve as local administrators,
and that the review and evaluation process be expanded to include more
local stakeholders.
We need to recognize that should a Head Start program be defunded
by ACF, that this will create a critical and immediate community
challenge as ACF and others will need to seek new providers to continue
the operation of these programs so that the children and their families
are not negatively impacted by program service interruptions.
Recognizing that these provider relationships may have been forged over
decades, identifying and selecting new providers will take time and we
must acknowledge that ``breaking up is hard to do.'' To diversify
program delivery and to reduce the government tendency to utilize fewer
grantees for their own ease in monitoring and program administration,
Congress may wish to consider restrictions prohibiting the ACF from
allocating all its Head Start funding to a single organization within a
single large metropolitan area. Utilizing multiple providers can
provide an immediate backup should a current provider no longer be able
to effectively deliver the service.
Our goal should be to expand local oversight of the chosen
grantees. I know as a County Commissioner that my office frequently has
had to field calls from disgruntled parents who think that we can
directly resolve their issues with a Federal Head Start grantee as they
do not recognize that this is a Federal/local grant that does not flow
through the County.
We believe that local government needs to be more actively engaged
in the local review and evaluative process for the use of these Federal
programs. Local government is closer to the people, and we have the
opportunity of providing technical and mentoring assistance to our
local nonprofit agency partners, and additionally may be able to
provide other resources to expand the scope of services for the
operations of these programs. As shown by my handout, a number of these
new Head Start/Early Childhood Development Centers were the direct
result of that local funding commitment to this Federal program
reflecting our keen awareness of the importance that preschool
education can make for our children.
Additionally, the Federal Government might wish to transfer these
Head Start funds to local governments as a block grant, which would
provide for local oversight of these monies. Local governments
currently administer a number of block grant programs, and provided
that sufficient administrative monies are available to cover staff and
monitoring costs, the Head Start program might be transferred to this
local level whereby local government, rather than a more distant
Federal Agency, has day to day oversight monitoring responsibilities
for the Head Start program, and serves as the immediate contracting
grantee for the program.
As the grant managers for other Federal funds, State Agencies are
also uniquely qualified to serve in this facilitator role as they
currently supervise the administration of many other Federal grants,
including those from the Department of Health and Human Services.
Secondly, being geographically closer to the grant recipients, they may
have increased opportunities to provide critical oversight, technical
assistance, and mentoring assistance to enable those nonprofit grant
recipients to achieve full compliance with all the applicable Federal
regulations as the Head Start program is but one of many grants that
States make available to these nonprofit grant recipients, for which
the States are already responsible.
In assessing this reform initiative as part of the reauthorization
of the Head Start program, we must be careful not to overreact to this
GAO study and use it as an excuse to terminate or reduce Federal
funding for this critical human development program because of current
weaknesses shared at both the Federal and local levels. Our children
are too important to this Nation's future to be caught up in Federal
deficit reduction efforts, as fundamentally their future successes are
critical to our Nation's competitiveness on the world stage.
Where other countries have discriminated toward others due to
gender discrimination, America continues to be a shining light on the
hill as all our citizens have an opportunity to succeed based on their
abilities and hard work. This is the ``meritocracy'' envisioned by
Thomas Jefferson, where a person's abilities would be the only limit to
their ultimate life success, rather than pre-conditions of race, sex,
and economic status.
Let us work together to help the Head Start Program achieve its
original promise as a compensatory educational program to help our most
vulnerable youngest Americans and their families achieve this
Jeffersonian ``meritocracy.''
Senator Alexander. Thank you very much, Commissioner Gates.
Dr. Golden?
Ms. Golden. Thank you. Mr. Chairman, Senator Dodd, and
members of the subcommittee, my name is Olivia Golden and I am
a Senior Fellow at the Urban Institute. I am honored to appear
before you today.
My perspective on Head Start and on tough and effective
management has been shaped by a range of experiences as a
researcher and a practitioner at the Federal, State, and local
levels, as you heard from Senator Dodd. I spent 8 years at HHS,
including 3 as Assistant Secretary for Children and Families,
and in 1993 was a member of the bipartisan Advisory Committee
on Head Start Quality and Expansion, which included staff from
both parties of this committee. The Advisory Committee's
unanimous final report provided a rigorous blueprint for
quality, including strengthening Federal oversight capacity.
As a result of reforms put in place by HHS and the
Congress, beginning with the 1993 Advisory Committee, the 1994
Head Start reauthorization, and the 1996 publication of tough
research-based performance standards, Head Start has the most
rigorous standards and the most intensive monitoring of any
human services program that I am aware of, a point that Dr.
Caccamo also made. This emphasis on accountability paid off in
clear results in the late 1990s. As GAO's report indicates, a
historically unprecedented 144 grantees were terminated or
relinquished their grants between 1993 and 2001.
GAO's report provides useful next steps for Federal
oversight that build on these earlier reforms. Before turning
to the suggestions I would like to make for implementing GAO's
recommendations, though, I would like to highlight two themes
from the research that are explained in much more detail in my
written testimony.
First, and I think this came through in several questions
earlier, Head Start serves extremely vulnerable children and
families who experience multiple and complex problems. And
second, Head Start programs make a positive difference for
these very disadvantaged children and their families. Research
demonstrates both Head Start's positive results for children
and the generally high quality of local programs--and I just
want to note in reference to Chairman Alexander's earlier
question that, interestingly, the research suggests a very high
level of consistent quality, much more than in those other
education systems you described. So there is a lot of
consistency in the good quality of Head Start programs when
researchers go out and look.
To me, these themes underline the importance of
accountability in Head Start. Federal oversight has got to live
up to the crucial importance of Head Start's mission.
Let me turn now to five suggestions for strong Federal
oversight detailed in my written testimony. These suggestions
draw on my experience raising the bar on accountability during
the 1990s. They are lessons both about what works and about
what is perennially difficult. The central theme is that
holding Head Start programs to high standards, including
closing those that can't meet the standards, can be done with
focused and hands-on Federal oversight.
So lesson one, the foundation for strong Federal oversight
and for results for children is the tough, rigorous, and
research-based requirements in the performance standards. As a
result of the Advisory Committee recommendations and the 1994
reauthorization, we thoroughly revamped and strengthened the
performance standards in 1996, bringing them in line with the
latest research. These rigorous standards are especially
important because emerging research indicates a link between
strong and effective implementation of the standards, on the
one hand, and results for children on the other.
Lesson two, terminating grantees and aggressively
negotiating relinquishments are important and realistic steps
for HHS to take when a grantee cannot successfully resolve its
problems. Hands-on leadership is key. Stronger authority for
HHS to terminate grantees who can't meet standards was included
in the 1994 reauthorization and the 1996 regulations. As GAO
indicated in its 1998 report, HHS moved quickly and
aggressively to use that authority. My own experience was that
personal and hands-on involvement was very important. In one
example, I flew out to Denver to speak with parents and board
members at a grantee about the gravity of our monitoring
findings so they could make a more informed decision about
relinquishment.
Lesson three, and this is a point that came up, I know, in
Senator Dodd's questions, continuity for successful grantees is
just as important as turnover for unsuccessful grantees. For a
Head Start program to do a truly excellent job at linking
children to services in a community takes time, it takes
consistency, it takes relationships among partners developed
over many years. So that means that strong technical assistance
to get to programs at the beginning, keep successful programs
on track, is a critical partner to strong monitoring in the
Federal oversight strategy. That also means that recompetition
should be limited to unsuccessful programs.
Two more quick lessons. Lesson four, the Federal oversight
strategy needs to integrate fiscal accountability with program
results at every stage.
And finally, the oversight strategy must include a focus on
Federal staff, both in the central office and in the regions,
including training, professional development, and their ability
to make consistent decisions.
In conclusion, for 40 years, the Head Start program has
played a critical role, as you have heard, from the Nation's
most impoverished and vulnerable children, continuing to evolve
and innovate in response to family needs. For Head Start to
continue this success requires an equally strong, innovative,
and vigorous Federal oversight role.
I want to say thank you to the members of this committee
for your consistent and historic support for the program and I
look forward to any questions that you may have.
Senator Alexander. Thank you, Dr. Golden. It is very
helpful to have your perspective, given your involvement for
such a long period of time.
[The prepared statement of Ms. Golden follows:]
Prepared Statement of Olivia A. Golden
Mr. Chairman, Senator Dodd, and members of the subcommittee, my
name is Olivia Golden, and I am currently Senior Fellow and Director of
the Assessing the New Federalism project (a multi-year, nationwide
study of low-income children and families) at the Urban Institute, a
nonprofit, nonpartisan research institute in Washington, D.C.\1\ I am
honored by the opportunity to appear before you today to discuss the
Head Start program, effective strategies for Federal monitoring, and
the content and recommendations of the GAO's recent report regarding a
Comprehensive Approach to Identifying and Addressing Risks.
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\1\ The views expressed in this testimony are those of the author
and should not be attributed to the Urban Institute, its trustees, its
employees, or its funders.
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My perspective on Head Start, on programs that serve low-income
children and families, and on tough and effective management to support
accountability has been shaped by my experiences as a researcher and a
practitioner at the Federal, State and local levels. Immediately before
coming to the Urban Institute, I directed the District of Columbia's
Child and Family Services Agency. Before that, I spent 8 years at the
U.S. Department of Health and Human Services, as Commissioner for the
Administration on Children, Youth, and Families and then as Assistant
Secretary for Children and Families. During those 8 years, I was a
member or chair of three expert committees charting the future of Head
Start. In 1993, I was a member of the bipartisan Advisory Committee on
Head Start Quality and Expansion, which included both majority and
minority staff to this committee as well as staff from both parties to
three other House and Senate committees. The Advisory Committee's
unanimous Final Report provided extensive recommendations, including a
rigorous blueprint for monitoring program and fiscal quality and
strengthening Federal oversight capacity. In 1994, I chaired the
Advisory Committee on Services for Families with Infants and Toddlers,
which created the overall design for Early Head Start. And in 1999, I
chaired the Advisory Committee on Head Start Research and Evaluation,
which provided an overall framework for the design of the Head Start
impact study. We are all eagerly awaiting the first report from that
study.
In my testimony today, I will focus primarily on effective
strategies for building the strongest possible Federal oversight role
to support high-quality, fiscally accountable, programmatically
successful, and well-managed Head Start programs across the country. As
a result of reforms put in place by HHS and the Congress--beginning
with the bipartisan 1993 Head Start Advisory Committee, the 1994 Head
Start reauthorization, and the 1996 publication of tough, research-
based performance standards and continuing across two administrations--
Head Start has the most rigorous standards and the most intensive
monitoring of any human services program that I am aware of. This
emphasis on accountability by HHS and the Congress paid off in clear
quality control results during the late 1990's: for example, as the GAO
report indicates, 144 grantees were terminated or relinquished their
grants between 1993 and 2001, a historically unprecedented number.
GAO's report provides useful next steps for the Federal oversight
role that build on these earlier reforms. The report does not, however,
provide a clear picture of the number or proportion of Head Start
programs with serious fiscal problems, because it shows the percentage
of programs with even one monitoring finding, rather than grouping
programs by frequency or severity of findings. Based on the Head Start
Bureau's annual monitoring reports, about 15 percent of grantees have
serious problems, including both programmatic and fiscal problems.
Whatever the current numbers, any serious failures in fiscal
accountability need to be forcefully addressed.
The GAO report contributes to this effort by identifying gaps in
Federal oversight--in particular, how the Federal implementation of
monitoring doesn't live up to the rigorous design--and by providing
practical recommendations for improvement. The implementation
challenges highlighted in the report--such as effective use of early
warning information, consistent decisionmaking across central office
and the regions, and closing ineffective programs on a prompt timetable
yet with appropriate due process--are not limited to any one
Administration or even to one program. In my own experiences both with
Head Start monitoring and with designing and implementing monitoring
systems for other programs and at other levels of government, these
same challenges have arisen. For that reason, I believe that the GAO's
practical recommendations for next steps are particularly useful and
that thoughtful implementation of these recommendations, with some
additional suggestions and modifications that I suggest below, should
help Head Start programs live up to the very highest levels of
accountability.
Why Accountability Matters: The Research Context and the Role of Head
Start
Before turning to these specific suggestions about monitoring, I
would like to highlight briefly two broader themes from the research.
To me, these themes--(1) that Head Start serves extraordinarily
vulnerable children and families and (2) that it makes a positive
difference for them--underline the whole reason accountability is so
important. In a program with such a critical mission, and such a
history of success for the most vulnerable children in good times and
bad, we must ensure that Federal oversight lives up to the importance
of the mission, both demanding and supporting strong programs.
First, Head Start serves extremely vulnerable children and
families, who experience considerable disadvantage and often multiple
and complex problems. Children enrolled in Head Start may suffer from
various health conditions and disabilities, live in families that have
difficulty finding and keeping stable housing, and experience violence
in their families and neighborhoods. For these children, improved
learning and cognitive development require extremely high-quality
services that follow the comprehensive model laid out in the Head Start
performance standards.
For example, a survey of a nationally representative sample of Head
Start families in 2000 found that 25 percent of parents were moderately
or severely depressed, more than 20 percent of parents had witnessed
violent crime, and parents reported that almost 10 percent of their
children had witnessed domestic violence in the last year. According to
the researchers, ``preliminary findings suggest that Head Start may
play a role in protecting children from the negative outcomes
associated with family risk factors, including maternal depression,
exposure to violence, alcohol use, and involvement in the criminal
justice system.'' \2\
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\2\ Administration for Children and Families, Office of Planning,
Research, and Evaluation. April 2003. Executive Summary for Head Start
FACES 2000: A Whole-Child Perspective on Program Performance, p. 8.
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Second, Head Start programs overall make a positive difference for
these very disadvantaged young children and their families. Both past
and recent research, such as the rigorous, random assignment evaluation
of Early Head Start, demonstrate Head Start's positive results for
children and the generally high quality of its programs when observed
and compared with other early childhood programs. For example,
A rigorous, randomized assignment evaluation of Early Head
Start found that compared to a control group, 3-year-olds who had
attended Early Head Start had higher average scores and a smaller
percentage at-risk in language development, higher average scores and a
smaller percentage at-risk on tests of cognitive development, and
better home environments and parenting practices (for example, more
reading to young children).\3\
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\3\ Administration for Children and Families. June 2002. Making a
Difference in the Lives of Infants and Toddlers and Their Families: The
Impacts of Early Head Start. Executive Summary, pp. 3-4.
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Studies of Head Start using a variety of methods (for
example, comparing siblings who have been in Head Start with those who
have not) also show positive results for children. Soon, the results of
the random assignment study of Head Start--designed by the committee I
chaired in 1999--will be released. This study should provide more up-
to-date information about the effects of Head Start for today's
children, compared with being in other programs or at home.
When researchers score Head Start classrooms across the
country using standard indicators, they generally find them good and
quite consistent in quality. A recent study that observed classrooms in
six State pre-k programs found that the overall quality of these
classrooms was lower than in similar observational studies of Head
Start.\4\
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\4\ Donna Bryant, Dick Clifford, Diane Early, and Loyd Little.
2005. ``Who Are the Pre-K Teachers? What Are Pre-K Classrooms Like''
Early Developments 9(1): 15-19. Published by the FPG Child Development
Institute at the University of North Carolina at Chapel Hill.
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Low-income children are less likely than higher-income
children to get the benefits of high quality pre-school or child care
settings. This disparity would be far greater without Head Start,
especially for the poorest children. Research conducted through the
Assessing the New Federalism project at the Urban Institute has found
that low-income 3- and 4-year-olds are less likely to be in center-
based care (including preschool) than higher-income children. Because
of the research evidence suggesting that quality center-based care can
help children prepare for school, the researchers conclude that this
``disparity . . . may represent a missed opportunity to assist low-
income children in becoming school-ready.'' \5\
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\5\ Jeff Capizzano and Gina Adams, 2003. ``Children in Low-Income
Families Are Less Likely to Be in Center-Based Child Care.'' Snapshots
of America's Families III, No. 16. Washington, DC: The Urban Institute,
p. 2.
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The Accountability Agenda: Lessons from Experience
The reforms in Head Start quality and accountability that were
driven by the bipartisan Advisory Committee of 1993 and the Head Start
reauthorizations of 1994 and 1998 provide a very rich source of lessons
about strong Federal oversight--both what works and what issues are
perennially difficult and need to be revisited often. The central theme
is that holding Head Start programs to high standards, including
closing those that can't meet the standards, can be done. It takes
strong, focused, and hands-on Federal oversight that includes both
monitoring and technical assistance.
The reforms grew out of the widespread concern that after several
years of expanding the number of children served in Head Start without
corresponding investment in program quality or in the training and
development of Federal staff, the quality of local Head Start programs,
while generally good, had become uneven. The charge of the 1993
Advisory Committee--whose members in addition to Congressional staff
from both parties and both houses included experts with experience in
academia, the Federal Government, State and local early childhood
programs, and the broader health and education worlds--was to provide
recommendations for both improvement and expansion that would reaffirm
Head Start's vision of excellence for every child. The extensive and
specific recommendations in the unanimous report covered every area of
quality improvement, from local programs to Federal staff. Many of the
recommendations were incorporated into the 1994 Congressional
reauthorization of Head Start, and others were implemented by HHS
without requiring legislative authority.
Five specific lessons from this experience seem to me particularly
important as Congress and the Administration consider implementing the
GAO's recommendations:
1. The foundation for strong Federal oversight--and of results for
children--is the tough, rigorous, and research-based requirements of
the Head Start performance standards.
The Advisory Committee recommended and the 1994 Head Start
Reauthorization required a major overhaul of the Head Start regulations
that define what is expected of local programs (regulations that are
known as the Head Start Performance Standards) to raise the bar for the
quality of both service delivery and management. The final regulations,
published in 1996, thoroughly revamped and strengthened the performance
standards across many dimensions. For example, they:
raised standards for program management, including fiscal
accountability and governance;
brought standards for service delivery into line with the
latest research;
created new standards which had not existed before for the
quality of services to infants and toddlers.
Thus, many of the rigorous fiscal, board governance, and reporting
standards discussed in the GAO report are in place now because of this
important revision of the performance standards. For example, as part
of their fiscal and governance standards Head Start programs are
expected to ensure that their governing board and the parent policy
council approve funding applications and review the annual audit.
Rigorous standards are important not only because they hold
programs accountable and form the basis of a coherent monitoring
strategy but also because emerging research suggests a link between
strong implementation of the standards and positive results for
children. As part of the Early Head Start evaluation mentioned above,
researchers assessed program implementation of key elements of the
performance standards during indepth site visits. They found evidence
that ``full implementation [of the performance standards] contributes
to a stronger pattern of impacts.'' \6\
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\6\ Administration for Children and Families (June 2002), p.6.
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2. Terminating grantees and aggressively negotiating
relinquishments are appropriate, important, and realistic steps for HHS
to take when a grantee cannot successfully resolve its problems and
meet fiscal and program standards. Hands-on leadership is key to using
this authority effectively.
Stronger authority for HHS to terminate grantees who cannot meet
standards was recommended by the 1993 Advisory Board and included in
the 1994 Head Start Reauthorization. As a result, the 1996 revision of
the performance standards provided a framework and a tight time limit--
no more than 1 year--for grantees with serious problems (called
``deficiencies'') to solve those problems or face termination. As GAO
indicated in its 1998 report assessing HHS oversight soon after the
regulations, the agency moved quickly and aggressively to use this new
authority, with 90 grantees terminated or voluntarily relinquishing
their grants by the time of the 1998 report. The GAO report also noted
the experience of HHS officials that the termination authority helps
them negotiate voluntary relinquishments, which can be the quickest and
smoothest path to a transition.
While I was at HHS, I found that hands-on involvement from agency
leadership was very helpful in reinforcing the new expectations. In one
example, I flew to Denver to speak with parents and Board members about
the gravity of our monitoring findings, so they could make a more
informed choice about whether the grantee should relinquish the grant
in order to achieve better services for children. In that example, the
grantee relinquished the grant, and a transitional grantee ensured that
services to children continued uninterrupted while the grant was
recompeted.
GAO recommends in its report an additional approach, besides
termination and relinquishment, to ensure the replacement of grantees
who cannot successfully serve children. The comments provided by the
Administration on Children and Families express serious legal concerns
about this approach, which involves changes in the recompetition of
Head Start grants. I am not qualified to comment on the legal issues,
but I would note that the existing approaches, termination and
voluntary relinquishment, exercised with strong leadership and under a
tight timetable, have in my view proved effective at raising the bar on
program quality and compliance.
3. The goal of the Federal oversight strategy is good results for
children. To achieve this goal, continuity for successful grantees is
just as important as turnover for unsuccessful grantees. This means
that strong technical assistance--high-quality, well-tailored to
grantee needs, and available promptly on request--is a critical partner
to strong monitoring in the Federal oversight strategy. It also means
that recompetition of Head Start grants should be limited to
unsuccessful programs.
A very important lesson from the deliberations of the Advisory
Committee, reinforced for me by my own research and practice
experience, is the value to children and families of continuity over
time in a quality Head Start program. The Advisory Committee found that
an effective Head Start program needs to be a central community
institution for poor families: it has to link services that vulnerable
children need in order to learn, such as health care, mental health
services (for example, when young children have experienced family or
neighborhood violence), and help for parents who may be young,
overwhelmed, and struggling to support their children. For a Head Start
program to do a truly excellent job at linking children to needed
services takes time, patience, and a consistent set of players in a
community, sometimes over many years. As a result, just as constant
staff turnover can jeopardize quality services for children, turnover
in a program can set back quality for many years, as new players get to
know each other and readjust their priorities. In my own research, not
specifically focused on Head Start but on communities around the
country that created successful partnerships to serve both parent and
child in poor families, I found that longstanding relationships among
people involved in the work over many years were an important
ingredient of success.
Continuity also matters because the lives of poor children,
families, and communities are unstable in so many ways that the Head
Start program may be the one critical source of stability. From my
experience in child welfare, where I directed an agency that serves
abused and neglected children, I became convinced that a high quality
Head Start or Early Head Start program can be a source of consistent
stable relationships for babies, toddlers, and preschoolers who are
moving around from home to foster care and back as a result of abuse or
neglect. Given what the research tells us about the importance of
consistent relationships to cognitive development in early childhood,
this role is crucial.
Therefore, it is just as important to a successful Federal
oversight strategy to make sure strong programs continue to succeed as
it is to make sure failing programs are replaced. As the Advisory
Committee made clear in its very first recommendation regarding Federal
oversight, this means placing a priority on responsive, up-to-the-
minute, technical assistance capacity easily available to local
programs and closely linked to program and management priorities. When
programs have strong capacity and a strong track record in serving
children, the Federal oversight responsibility must include making sure
that a small problem doesn't grow until it threatens a program's
continued success. And as new issues emerge across the country, the
technical assistance system must be able to respond flexibly and
effectively.
At HHS, when we revamped and invested in technical assistance in
response to the Advisory Committee report, we learned to consider
technical assistance early in every one of our initiatives. For
example, in implementing the current GAO report, HHS might consider
whether the early risk assessment strategy would have its greatest
impact paired with rapid-response technical assistance, so a program
could get help as soon as the risk assessment set off alarms. While I
was at HHS, we used a variation on this strategy in the field of child
welfare, seeking to make sure that when we implemented more rigorous
child welfare reviews, technical assistance to address newly identified
problems would be rapidly available.
4. The Federal oversight strategy needs to integrate fiscal
accountability with program accountability at every level and stage--in
staff training, in the design of monitoring, and in additional elements
of the strategy such as the comprehensive risk assessment or the
analysis of improper payments proposed by GAO. Focusing on fiscal
accountability without also emphasizing program accountability and
results for children can lead, in the words of GAO's 1998 report on
Head Start monitoring to ``hold [ing] local Head Start programs
accountable only for complying with regulations--not for demonstrating
progress in achieving program purposes.'' \7\ Looking at the two kinds
of accountability together, on the other hand, can lead to successful
solutions that help programs serve children better and more
efficiently.
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\7\ U.S. General Accounting Office. 1998. Head Start: Challenges in
Monitoring Program Quality and Demonstrating Results, p. 3.
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Local programs providing Head Start services, like all publicly
funded human services programs serving children with complex needs,
often face questions about how to meet child and family needs and yet
stay within fiscal reporting and accounting requirements. For example,
when Head Start programs collaborate with other local programs--such as
a mental health clinic that can help children who have experienced
violence in the home--they often face questions about what services
they should pay for from the Head Start grant and what services should
come out of the other agency's funding stream.
For these and many other questions that come up regarding fiscal
accountability, it is important to find solutions that support program
creativity and innovation as well as fiscal accountability. The worst
outcome is to have different program and fiscal experts or monitoring
reviewers provide conflicting advice. Conflicting responses create the
kind of unfairness that GAO cites, where different programs get
different treatment, and they also chill innovation, because many
programs won't want to risk innovation without knowing how reviewers
will judge it. The best outcome is for fiscal and program experts to
work together to develop solutions to the real problems programs face.
Integrated training for fiscal and program reviewers is also likely
to reduce the inconsistencies reported by GAO in assessing program
findings and deficiencies. Among the many reasons that people interpret
regulations differently, one is the different focus of ``compliance-
oriented'' fiscal reviewers and ``results-oriented'' program reviewers.
For this reason, it is especially helpful to address potential
conflicts explicitly in advance.
5. Finally, a key step in implementing the GAO recommendations will
be a focus on Federal staff in both central office and the regions:
their training and professional development, staffing levels, and
administrative support (such as travel resources), as well as
strategies to make Federal decisionmaking more consistent. These are
difficult issues that have not been solved yet, either in Head Start or
in most other monitoring programs, but there are promising examples to
draw on.
While I was at HHS, we tried a number of approaches to these
dilemmas--investing in Federal staff despite very tight administrative
budgets and promoting consistent decisionmaking--but there is much left
to be done. One promising approach that we implemented might offer
lessons for today's strategies, because it aimed both to use Federal
dollars more efficiently and to achieve program goals, including Head
Start accountability. Specifically, we chose to divide the ten regions
into five pairs, each with one larger ``hub'' region and one smaller
region, and to design some of the Head Start monitoring strategies
across the two paired regions. We used this approach to allocate
resources more efficiently and to ensure that if we thought it
appropriate, the monitoring team leader for a particular review could
be from the region that did not directly oversee the grantee. This
allowed the selection of a team leader who was familiar with the
geographic area but not involved with the individual grantee.
In summary, a well-designed system of Federal oversight for Head
Start must
set the bar high, through rigorous and research-based
standards;
ensure through aggressive and hands-on management that
unsuccessful programs are promptly replaced;
ensure prompt and high-quality technical assistance, to
promote continuity and steady improvement for successful programs;
integrate an emphasis on management with an emphasis on
results for children, in order to support creativity, innovation, and
fiscal responsibility;
use multiple approaches to strengthen Federal staff
capacity.
For more than 40 years, the Head Start program has played a
critical role for the Nation's most impoverished and vulnerable
children, continuing to evolve and innovate to respond to increasingly
complex family needs. For Head Start to continue this success into the
future requires an equally strong, innovative, and vigorous Federal
oversight role. I appreciate the subcommittee's commitment to ensuring
the continued strength of this Federal role, so that Head Start can
build on its record of making a difference to America's poorest young
children and their families. Thank you for the opportunity to offer
suggestions for further improvements, and I look forward to any
questions you may have.
Response to Questions of Senator Enzi by Olivia Golden
Thank you for the opportunity to testify before the subcommittee
and for the opportunity to answer these additional questions.\1\
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\1\ The views expressed in this response are those of the author
and should not be attributed to the Urban Institute, its trustees, its
employees, or its funders.
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Question 1. You made reference to the GAO recommendations and the
effects you believe they will have on ensuring program accountability.
You have also made specific additional recommendations that would focus
on the local level, either the grantee or local governments. How do you
see Congress supporting the efforts of communities and organizations
like yours to implement the recommendations made by the GAO?
Answer 1. Both GAO's report and my testimony focused on Federal
accountability: how the Federal Government can best ensure that local
Head Start programs live up to the high standards that are key to the
success of Head Start. In my testimony, I provided five broad themes
that I recommended Congress and HHS keep in mind as they implement
GAO's recommendations. I appreciate the opportunity to address the
implications of these themes for local as well as Federal quality and
accountability.
First, I emphasized the critical role that Head Start's tough,
research-based performance standards have played in the program's
success. I stressed that Congress should ensure a continued commitment
to those standards. In addition, to support local grantees in meeting
these standards, Congress could examine whether they consistently have
the tools to do so, including both the knowledge and resources. Key
provisions in the statute for achieving these aims are the quality set-
aside and the technical assistance set-aside, discussed more fully
below. Clearly, the effectiveness of these set-asides, particularly the
quality set-aside, which is a percentage of expansion dollars, depends
not only on the authorizing statute but also on the level of
appropriations. Congress may want to review the evidence from the last
several years to determine whether the absence of resources dedicated
to quality has made it more difficult for programs to meet the
performance standards.
Second, I emphasized in my testimony that when local Head Start
programs do not succeed in meeting the standards, a hands-on Federal
role is key to terminating them. At the hearing, local witnesses
argued, in at least two of the three examples, that Federal involvement
was ``too little, too late.'' Whether this is an issue of Federal
resources, training and skills of Federal staff, or priorities is hard
for an outside observer to know. But the Congress may want to focus on
enhancing training, skills, and possibly staffing levels for the
Federal functions that directly support Head Start grantees, including
but not limited to monitoring.
Third, I emphasized the critical role of Federal technical
assistance in ensuring continuity for good Head Start programs. In
addition to the broad availability of technical assistance to all
programs, I suggested targeting high-quality and immediately available
technical assistance to programs identified as at risk through GAO's
proposed early-warning system. At the hearing, the testimony of the
local witnesses seemed to me to support this idea of immediate, high-
quality technical assistance as soon as problems are identified. (For
example, in the case of Shelby County, Tennessee, the Mayor was the
grantee yet apparently perceived that he was not able to get timely and
helpful Federal assistance in enforcing accountability on his delegate
agencies.) These observations about the role of high-quality,
responsive, and timely technical assistance in accountability and
performance suggest the continuing importance of the technical
assistance set-aside in the Head Start statute.
Question 2. A common theme in this hearing is that the Head Start
program is a direct Federal to local program. That's been the model for
the program since its inception, roughly 40 years ago. Have we come to
a point where a State or local role would be appropriate, such as
allowing States to compete for Head Start grant funds?
Answer 2. The goal of Head Start is to help children get ready for
school, through a strong classroom program, active parental
involvement, and comprehensive services that help children learn. To
achieve that goal, as noted in the question, the community-level focus
of Head Start has been a central feature of the program's design since
its inception. A Head Start program that is strongly grounded in the
local community will be able to recruit extremely disadvantaged
families who may be suspicious of other institutions, engage parents in
their children's education and well-being, and develop linkages with
other local programs and institutions that ensure Head Start children
and families get the services they need, such as family support,
health, and mental health services. For all these reasons, I believe
that Head Start's community-based, Federal to local, design is a key
programmatic strength.
Given this community-based design, strongly underlined in the
performance standards, I do not think that State Agencies would be
appropriate applicants for Head Start grants. In addition, as I
suggested earlier in these responses and in my testimony, other key
elements of quality supported by the research are the strong and
consistent Federal performance standards and the strong Federal
monitoring and technical assistance infrastructure. Thus, the current
Federal to local design builds in the elements that research suggests
are most important for quality: close connection to the family and
community on the one hand, along with high, research-based standards
implemented through technical assistance and monitoring on the other.
However, I think that many kinds of partnerships between State
Agencies and local Head Start programs are key to enhancing child and
family well-being. Many of these partnerships already exist and others
can be encouraged through the mechanism of the State collaboration
grants, as described below. For example, in those States that fund
early childhood activities for infants, toddlers or preschoolers,
including pre-kindergarten programs, a range of partnerships are
possible: Head Start programs may compete for these State grants, or
may share materials and training opportunities with other local
providers, or may develop strategies for funding programs together that
can reach more children or reach children for a longer school day or
year than any of the programs could do alone. In addition, State
Medicaid programs and other health care services for low-income
children and families are key partners for Head Start as well as for
other early childhood programs.
Question 3. As you all know, each State operates a collaboration
office. What role do you see those offices playing in helping to
improve the accountability process and more successfully integrating
programs with a common interest across State and local boundaries?
Answer 3. Through the bipartisan commitment of the Congress in the
1994 reauthorization, I am very proud that while I was at HHS, we were
able to follow the recommendation of the Advisory Committee on Head
Start Quality and Expansion and expand the State collaboration grants
from just over 20 States to all States. The State collaboration offices
have an important role to play in improving results for children,
particularly at a time when States have shown considerable interest in
investing in programs for young children and when there are promising
examples of collaborations that link Head Start, child care, and other
early childhood education programs for the benefit of children. Drawing
on the lessons from these examples as well as promising experiences in
related fields, I would suggest several particularly useful areas for
the State collaboration offices to focus on:
a. In terms of accountability, one promising role for the
collaboration offices is to work with States that fund early childhood
programs toward strong, rigorous, research-based quality standards
across multiple programs--for example, incorporating the Head Start
performance standards into State approaches to funding model infant-
toddler or pre-K programs.
b. A related role is to expand joint training opportunities, where
staff in multiple early childhood programs, including Head Start and
state-funded programs, receive high-quality training in the development
and education of young children, parent involvement and family support,
or management topics that are shared across the different settings.
c. The collaboration offices should be exploring a whole range of
strategies for helping all programs reach for and achieve high
standards of quality. For example, they may be able to identify ways to
more fully involve the State's higher education system in preparing the
early childhood workforce, working with Head Start and state-funded
programs to place students in internships, and providing quality
assessments that help programs figure out where they are strong and
where they could improve.
d. In terms of integrating systems, one way for the collaboration
offices to improve the quality of care for all children is to work
toward statewide memoranda of understanding that can connect both Head
Start programs and state-funded child care and early childhood programs
to other services that all need, such as health and mental health
services funded by Medicaid or other State programs.
I very much appreciate the opportunity to testify as well as the
opportunity to answer these additional questions. Please feel free to
e-mail me (at [email protected]) or call (202-261-5699) if I can
provide any additional information.
Senator Alexander. We will now go to questions from the
Senators and we will try to limit those to 5 minutes to have
the maximum amount of time for that.
Mayor Wharton, let me go back to you because, let us assume
for a moment that, as Dr. Golden says, a lot of work has been
done to try to create what Mr. Caccamo said was a thorough sort
of Federal review. But what you are really telling us is a
little different. You are saying that between Washington and
Memphis there may be a pretty good review, but when it gets
down to Memphis and somebody has to do something about it, it
is hard to get it done.
Now, let me make sure I understand this. The grant in the
case of Shelby County, it is a lot of money. It is about $12
million, is----
Mayor Wharton. Twenty-two million.
Senator Alexander [continuing]. Twenty-two million. How
many children are affected?
Mayor Wharton. About 3,100.
Senator Alexander. Thirty-one-hundred children.
Mayor Wharton. It should be 10,000 if we could ever get
straightened out down there.
Senator Alexander. The grantee was not the county
government but was a separate entity, is that right?
Mayor Wharton. If I do not--thank you, Mr. Chairman. If I
do not make anything else clear here, I hope I will be able to
make this distinction, because as I read reports throughout the
Nation, there is a blurring of identity there. Shelby County
Government was the grantee, not to be confused with your
various delegate agencies who signed contracts with the
grantee.
Senator Alexander. OK. So when you came into office 3 years
ago----
Mayor Wharton. Three years ago.
Senator Alexander [continuing]. You found that your
government to which you were elected had a responsibility with
the Federal Government to manage this program for low-income
children and you found a lot of problems. What I think is
important for us to understand is precisely why it was so hard
for you to fix the problems and what we can change in the law
to make it easier for local officials like you to fix the
problems.
Mayor Wharton. Sure. Out of the roughly 3,000 enrollees,
children, 2,095 were in the hands of an agency known as Head
Start, Incorporated.
Senator Alexander. That is a delegate agency.
Mayor Wharton. That is correct. It was a delegate agency
which, in turn, had other, I guess I could call them sub-
delegates or whatever you wish, but a very complicated
structure and a very powerful structure politically. Again, any
time you are spending $20 million in some impoverished
communities, you develop power, and the individuals used it to
the hilt.
When I had the goods on a particular director, it wasn't
enough for me to say, you have violated this, you have violated
that. I had to go through the policy council.
Senator Alexander. Now, for example, what were the goods? I
mean, what was done wrong?
Mayor Wharton. Well, simply not accounting for the funds.
Where are they? Some of these matters are still in court and
various investigative processes, so I don't want to prejudice
anything that might come out of that, but, for example, one
entity, I am still trying to find $90,000 worth of playground
equipment. The program had some, I have forgotten how many
millions issued in bond funds to build three Head Start
centers. They built one. I don't know where that money is and I
take it I will never find out where it is.
Senator Alexander. I interrupted you. You were about to say
that when you saw you needed to do something and you were
willing to take on the political challenge, you then had to do
what to get something done?
Mayor Wharton. I had to go to the policy council, which is
called for in the regulations here. And again, I have no
problem with shared governance. But to go to the council, many
of whom had very close relationships, very cozy, with the prior
administration of this delegate agency. I was an outsider. The
folks who were running that program had much more influence
than I did and the difficulty was getting the votes to get them
out.
Senator Alexander. Were there other hoops that you had to
jump through? You described hoops in your testimony.
Mayor Wharton. Once you get through that, I had to come
back to the actual county commission. I had terminated them
one, but Atlanta told me that, no, you have now got to go back
to another political body and get seven of the 13 votes before
you can take over that program. Had I not gone ahead and just
exercised self-help and pulled the financial operation then--I
basically said, stay out there, but I am taking the books away
from you and brought them in-house--we would have had much more
waste than we have uncovered already. So it was to go through
the policy council and then through an elected county
commission before I could get to the process of getting them
out of there.
Senator Alexander. You have got other things to do as the
mayor of the largest county in the State. How much of your time
did this take in relationship to other projects or problems you
were working on?
Mayor Wharton. Without quantifying it in any numerical
sense, I would say an inordinate amount of time, and let me say
this. Shelby County Government, as you well know, counties in
the State of Tennessee are responsible for funding all public
education, half of my budget. It is one of my preeminent
responsibilities to ensure that what goes into our public
schools are children who are ready to learn. I don't mind
focusing on that, but I should not have to spend all the time
on where did you buy the gas, where is the credit card, where
did you buy the car tires, where did you get the bus, where is
this, and that is what I was spending my time on, not the
processes that were going on in these little classrooms. Too
much time, Senator, to answer your question.
Senator Alexander. Thank you, Mayor Wharton.
My time is up, but I would like to conclude with this
observation. I used a little earlier the higher education
model, which is a model that we are familiar with whereby we
give thousands of institutions a great deal of autonomy and
then expect them to produce a result rather than, for example,
turn it over to the States or some intervening management
agency.
I have--let me just say this to my colleagues. I have
skepticism about how well in the end a Federal Washington-based
agency can manage 20,000 classrooms, 1,700 agencies, and many
more delegate agencies, and I think it is critical that we find
a way to, if we are going to have autonomy for so many
different agencies to spend so many Federal dollars, that once
that autonomy is centered somewhere, that that person, such as
the mayor or the county commissioner or whomever it is, have
the authority to be accountable and to do what we expect to be
done. Thank you.
Senator Dodd?
Senator Dodd. Thank you, Mr. Chairman. Does the chairman of
the committee want to go? Are you all right?
Thank you very much. Let me thank all of you for being here
today and sharing your thoughts with us. It is very, very
helpful.
Let me, if I can--by the way, I mentioned earlier--I forgot
to mention Ed Ziegler's name. I was talking about the person in
Connecticut who was responsible as the author of Head Start 40
years ago, and Ed is still very much involved in these issues
and writes extensively on them. We couldn't have a hearing
about Head Start and not mention the significant contribution
of Dr. Ziegler along the way.
Let me, is it Dr. Caccamo?
Mr. Caccamo. Yes.
Senator Dodd. Doctor, let me, if I can, ask you to maybe
address a little bit more the issue of the boards. I happen to
agree with you as to your recommendations about the board
involvement. It is not a question of increasing the size of the
membership but rather the type of individuals that serve on the
board and the training and the skills that they ought to have
in order to be an effective board, it seems to me. I wonder if
you might share with us anything about the training of the KCMC
board itself, what your experience has been there, and also
what might be an effective on-the-ground management training
for senior management within the Head Start agencies
themselves.
It seems to me, again, going back to the questions that I
raised with the previous panel, if you had to pick out one area
to really work on, assuming for a second the broader question
of block granting Head Start and so forth, but how can you make
this more effective in dealing with the front end of the issue,
and that is getting the right people in place?
And by the way, Mayor, I think your suggestion about the
family council and the board, separating out the roles, make
some sense to me for the very reasons you identified. The
family council members are more inclined to be interested in
whether or not children are getting the kind of learning they
need. I am not as aware about all this. I was sort of surprised
to hear that they would also be asked to be involved in the
minutiae of financial management. But if that is the case, I
think your suggestion makes some sense.
But if you might comment on what your experience is
regarding board training.
Mr. Caccamo. Yes, Senator. I think it is critical. Board
members have to understand that when they say ``yes'' to being
on a board that they take on a great deal of responsibility,
fiduciary and programmatic responsibility. It is critical that
they do that.
And, you know, if you look at local public schools, one of
the things that happens in local public schools is there is
some limit to the length of time people can spend on boards.
Those particular school districts, at least in our area, do a
great deal of board training. They have board retreats where
they talk about fiduciary responsibility, where they talk about
how to read a budget, where they talk about ethics and ethical
leadership around performance of that school board.
I think those same kinds of things should be done at the
local Head Start. They have not been, or weren't, and I think
part of the problem, and I think Mayor Wharton said it very
well about the political influence that you begin to build as
you spend years engaged in organizations like that.
The executive director, very, very excellent in
programmatic work. I don't think you will find a Head Start in
this Nation that would take Kansas City and place it in second.
We do fabulous work with our children. All of that work is done
with a great deal of community partners. All of the fiscal
stuff is done sort of without many partners, behind closed
doors, which adds to, I think, the responsibility of the board
having to be well trained.
So I think it has to be done. I think there are great
models in every community about board training and I think it
has to be a requirement that boards undergo some training
around their programmatic and fiduciary responsibilities.
Senator Dodd. Sort of a Sarbanes-Oxley approach to
corporate governance is what we are sort of looking at here, I
suppose, what I hear you saying.
Mr. Caccamo. Yes.
Senator Dodd. Let me jump to you, Dr. Golden, if I can. I
am going to get to the recompetition issue because I think it
is an important question.
First of all, let me ask you three questions regarding it
and have you address those. What would be an appropriate time
frame for citing of a deficiency before a grant is recompeted?
I would be interested in your views on that.
What do you think the criteria ought to be for the
recompetition of the Head Start grants?
And what types of training and technical assistance can
really make Head Start agencies--make a difference in Head
Start agencies with regard to the systems management, sort of
going back to the same question I asked Dr. Caccamo.
Ms. Golden. OK. Well, on the first two points about
deficiencies, I think what is key is to know what is in the law
and the rules now and then to think about whether what you need
is more aggressiveness by HHS and more effectiveness, or
whether you need additional statutory change.
The framework that is in the law right now from the 1994
reauthorization and the regulations we did after that says no
more than a year, and at the most, if an agency has got a
deficiency, you can give them a year. If it is a threat to
children's health and safety or the fiscal problems are there,
threatened Federal dollars, then you give them less.
And the definition in the law--I mean, again, Senator, the
dilemma Senator Alexander has highlighted, the definition in
the regulations is pretty clear, but it doesn't go into so much
detail that it would apply just like a cookie cutter. It says
that if an agency can't substantially accomplish the purposes,
you can't do early childhood successfully, you can't do health
care, or if you are not using--if you are misusing the dollars.
What it takes to implement that effectively, I think, is,
first of all, really good fact finding. You need Federal
reviewers that have the skill and the capacity and the travel
money to get out there and look.
Second, it needs good training and analytic skills for the
reviewers because they have to look at these list of things and
try to figure out what is going on. So Assistant Secretary
Horn's suggestions there, I think, are appropriate in terms of
improving his capacity to do that.
But then it circles back to your technical assistance
question in the end, it seems to me, because once you have
looked, you have seen a problem, the question is not just how
many days have you let go by, but have you done something? Have
you gotten in there the intensive help to try to make a
difference?
And so I agree completely with your earlier points that I
think were also made by others, that training and technical
assistance are key both in prevention and in getting into some
of those problematic grantees and turning them around, and I
would list as key areas, I share the perspective on the board
governance that has been highlighted by everybody here.
I would also say what affects the core of Head Start's
ability to provide services is the quality of its teachers and
its classrooms and their training. So you can't put programs or
the Federal TA system in the position of stealing the money
away for governance from the dollars required for training and
TA in the classroom.
And then the third piece I would put in is the ability of a
community program to link to all the rest of the services that
children need, mental health or health care. I think some of
the excellent programs we have heard about do that well. To do
that, they have to have training both to understand the
programmatic and to understand the fiscal implications, because
it can be complicated in accounting terms to do all that
together.
Senator Dodd. Very good, and my time is up. I know Dr. Horn
talked about a 240-day process in his testimony, and I will
leave it to a later time to get into that with you on why
particularly that length of time. I am curious if you know
any----
Ms. Golden. Well, I assume that that must be cases that
they play out in the legal system. As the example I gave in my
testimony, I think that if you lay out the evidence,
particularly given, as you have heard, people often are very
invested in the way they are doing things now, you very often--
a grantee will choose to relinquish because they understand
that what you have said to them is, we are going to terminate
it. Here is the evidence we have got. You, the parents on the
board whose children are in here, didn't get up in the morning
wanting to be running a program that we are going to be taking
you through the court. So I assume that he may have been giving
an example of one that played out all the way without that kind
of negotiation.
Senator Dodd. Thank you all very, very much. Again, Mr.
Chairman, thank you for holding the hearing.
Senator Alexander. Thank you, Senator Dodd.
Senator Enzi?
The Chairman. Thank you, Mr. Chairman, and I am glad that
Senator Dodd mentioned Sarbanes-Oxley because he and I are both
on the Banking Committee, as well, and about 3 years ago, we
had the opportunity to take a look at what was happening with
corporations in the United States, board governance.
Corporations, of course, were doing some things with private
money, manipulation, and we were absolutely appalled and we
took drastic action.
Now we are talking about some things where Federal money is
being used with nonprofit organizations and we are rising to
the defense of bad governance. That surprises me a little bit.
We are not talking about eliminating a program, we are talking
about making a program work, making a program better, making
sure that the money that goes into the program is being used
for what we intended for it to be.
I think we ought to be equally appalled with some of the
things that we are finding out about what is happening with
Head Start money and try and figure out some ways to make sure
that we put some rules in place that do that.
Senator Dodd. I agree with that.
The Chairman. As a former mayor, I really sympathize with
what Mayor Wharton is saying. I would ask if you could speak
specifically to some suggestions that Congress might provide
for support to local government to take more decisive action if
a Head Start program is in trouble. What things could we put
into place that would have helped you?
Mayor Wharton. Certainly, Senator. One thing I was able to
do, and I would make this as a recommendation, when I took
office, we only had one internal auditor in the entire country
government. I hired six and sent two of those to a couple of
the Head Start delegate agencies. Once those auditors visited
both of those troubled agencies, they immediately said, listen,
we simply cannot comply. Take us over.
If somehow Congress could as we as grantees submit our
applications, and I suggested this in my testimony, once a
grantee or an applicant specifies precisely how it intends to
govern financially and that is signed off on, then we ought to
be given full reign to let it rip, to let it go, and that is
what we did. So we were able to take two agencies out without
any appeals or whatever because we audited them and they saw
that they weren't living up and that ended it.
Second, I would suggest that the purchasing and all of
those troubled areas, that it be required that they be held
back from the delegate agencies on a centralized basis so that
if the folks from Atlanta came in, they do not have to audit 12
fuel accounts, 12 fuel accounts. They come to me. I would be
responsible for it, for doing the purchasing on the food or
whatever and getting it out. That way, you have got one account
that has to be audited.
So the premise, underlying premise of all my remarks is to
separate a lot of these, quote, ``business,'' close quote,
business activities from the basic purpose of Head Start, which
is nurturing, family support, instruction, all of those things.
Our agencies are getting in trouble more, they are causing
shame to the program more on the financial and business side
than they are on the original purpose of Head Start from an
instructional and child care standpoint.
So two things--three things, actually, when it comes to
shared governance.
Now, someone asked the question or made an observation that
they were not aware that board members actually get into
financial decisions. That may be true technically, but it is
the director of a given agency who is making those financial
decisions and bad decisions and doing wrong in instances. But
you then have to go to the policy council when you get ready to
get rid of that delegate agency, or actually to terminate that
individual.
Now, that is the most troublesome difficulty there. You
still have to ask--I was elected with 62 percent of the people,
but when I catch somebody doing wrong, I have to go out and go
through two or three levels and ask, is it okay if I get this
guy out of here? He is stealing from us. And if he has got more
sway than I do, he gets to stay.
So keep shared governance. But I think we need to pull it
back. Parents want to know, again, are you challenging my
child? Are you enhancing her cognitive abilities? Are you
teaching her to be a brave little child and to try new things?
They don't want to come to a board meeting and hear--we have
arguments that go into the night of whether you should have
bought the computers over there, whether the gasoline ought to
come from here. These are the kinds of things we are asking
parents who come to find out what you are doing for their
child, and yet they come to a meeting and listen for 3 hours on
where you bought the gasoline. That is the kind of thing that
we need to pull out of this shared governance model and that
would give us--let me get in my defense role, if you might.
When you focus on grantees.
The Chairman. My time has run out.
Mayor Wharton. When you focus on grantees, don't chop us
off until you have given us the authority to chop those off who
got us in trouble. That is all I would ask.
The Chairman. Thank you, and I wish I had time to ask
Commissioner Gates a couple of questions similar to that, and I
will in writing, so I appreciate it. Thank you.
Senator Alexander. Thank you. Senator Clinton has waited
patiently. Senator Clinton?
Senator Clinton. Thank you very much, Mr. Chairman, both
Chairmen, for having this hearing today. I would ask unanimous
consent that I could submit an opening statement to the record.
Senator Alexander. Without objection.
[The prepared statement of Senator Clinton follows:]
Opening Statement of Hillary Rodham Clinton
Thank you to all the witnesses for being here today. I
appreciate your time and energy in coming here today.
The topic we are discussing today--accountability for Head
Start programs--is a critically important one. But before I
speak to that, I want to make sure we do not lose the forest
for the trees. We are talking today about a program that for 40
years has provided the only Federal comprehensive early
childhood intervention for needy families. And while we can
split hairs on the exact implications of each and every impact
analysis conducted, the bottom line is that all of the research
points in the same direction--Head Start works. It is a cost-
effective, long-term investment for our society and it improves
outcomes for poor children and their families.
Most recently, Steven Barnett and Jason Hustedt conducted
an overarching analysis of Head Start's benefits--both long and
short term. Their conclusion on short term research is, and I
quote, ``studies have generally shown that programs for
children at risk, including Head Start, result in increases of
0.5 standard deviations in IQ and achievement.'' This study
also cites a rigorously designed, random assignment analysis by
Abbott-Shim, Lambert, and McCarty, which found that Head Start
participants benefited substantially compared to non-
participants in the areas of vocabulary, phonemic awareness and
health-related outcomes. This study also found that parents of
Head Start children reported more positive health and safety
outcomes than parents of children not in Head Start.
A 2001 article in the highly respected Journal of Economic
Perspectives, which analyzed everything we know about early
childhood intervention programs, starts off by saying ``This
review of the evidence concludes that these programs have
significant short and medium-term benefits, and that the
effects are often greater for more disadvantaged children. Some
of the model programs have produced exciting results in terms
of improving educational attainment and earnings and reducing
welfare dependency and crime.'' It goes on to say ``a simple
cost-benefit analysis suggests that Head Start would pay for
itself in terms of cost savings to the government if it
produced even a quarter of the long-term gains of model early
childhood programs.''
The most recent, highly respected analysis of the longer-
term effects of Head Start, which was published in the American
Economic Review, found unambiguous evidence of the success of
this program.
In short, this paper found that ``whites who attended Head
Start are, relative to their siblings who did not,
significantly more likely to complete high school, attend
college, and possibly have higher earnings in their early
twenties. African-Americans who participated in Head Start are
less likely to have been booked or charged with a crime.''
Now, I am never one to suggest that we rest on our laurels.
If there are steps we can take to improve Head Start--to make
it more efficient and more responsive to the families it
serves--then we should talk about that through a bi-partisan,
thoughtful, reauthorization process.
But I have been and remain very deeply concerned about the
Administration's position on Head Start. In the 2006 budget--
once again--we saw an attempt to turn this successful program
into a block grant. In fact, the President's entire budget
increase for Head Start--$45 million--is dedicated to
supporting block grants in nine States. And while all of this
talk today is about strengthening performance, the
Administration has proposed cutting training and technical
assistance resources in half. Frankly, those decisions make it
hard to trust this Administration when it talks about Head
Start. It signals that the Administration's true intention is
at odds with the will of this committee, which in October of
2003 unanimously passed a bill that rejected the
Administration's block grant approach.
I also think it is at odds with the facts to suggest that
there is limited accountability for Head Start programs. In
fact, quite the opposite is true. There are--quite literally--
1,800 program requirements, which evaluate the program on
virtually every factor imaginable. For example, there are 553
requirements for early childhood development and health
services; 206 on family and community partnerships; and 1,038
program design and management requirements. Head Start managers
have a number of tools to keep them in compliance, including an
annual self-assessment, monthly financial reports to the board,
an annual financial audit, and an annual program information
report. They have to participate in a triennial Program Review
Instrument for Systems Monitoring.
If all of these measures fail, HHS is support to provide
technical assistance and compliance expectation. And finally,
HHS may defund agencies that are performing poorly.
In short, during the Clinton Administration we set up a
gold standard for Head Start. We have an extensive monitoring
system. And when you demand that programs meet 1,800
requirements, you should not be surprised when a small
proportion of them fail to achieve perfection. And as you can
clearly see from the GAO report [see chart], relinquishments
and terminations of poorly performing agencies were much higher
during the Clinton Administration. Between 1993 and 1999, there
were 101 relinquishments and 24 terminations. Between 2000 and
2003, there have been a total of 18 relinquishments, and 3
terminations. So, I would hope that the first step would be to
rigorously utilize the oversight systems that are in place.
Senator Clinton. I want to thank the witnesses. This is one
of the best hearings that I think I can say I have attended. I
think the thoughtfulness and the extraordinary interest in this
program and the recognition of the success of the program
really stands in very good stead, because what we are looking
for are solutions to some problems as opposed to some of the
conversations about Head Start which really seem to overlook
the years and years of research about the success of this
program. So I want to thank each of the witnesses.
As I listened, I think that we are all saying the same
thing. We are trying to figure out how to get to the point
where the role of parents, which was one of the very critical
ingredients in early design of Head Start, is maintained but
without the kind of lack of training and the problems with
governance that have been so well outlined here by the
witnesses.
I think that the Mayor's very strong argument that what we
really want to do is build on the strength of Head Start, make
it even stronger, help people, you know, focus on what is
important and not get into trouble over what--the bottom line
is really not that important. I mean, you know, somebody else
should be really overseeing this.
I wanted to ask Dr. Golden, as you listen to this, because
I know you have had so many years of experience in evaluating
programs, terminating programs--I love your very gentle way of
saying you go make the presentation and they relinquish the
program, and there was a lot of that during the Clinton
administration where we, I think, ended up terminating 27 and
creating the circumstances for relinquishment of 117.
Really two questions. One, as you listened to the other
witnesses, how would you address their very legitimate
concerns? I mean, Commissioner Gates, who has one of the
fastest-growing places in the world, I think, with Clark
County, the Mayor's very specific examples, and Dr. Caccamo's
comments, as well.
We tried to do this in the reauthorization and the
regulations. Clearly, there is more than can be fine-tuned and
done. So my first question is, what more can we and should we
do?
But second, in the testimony from Secretary Horn, I think
that we heard that there have been cutbacks in the funding for
technical assistance and there has been a movement to try to
block grant Head Start, which I think would be a real mistake
for a lot of the reasons why Head Start has worked. But I
understand the frustrations of local leaders who themselves
feel on the line. So how do we get the Federal Government to do
a better job working with responsible leaders like the three
witnesses who are here?
Ms. Golden. Well, it is interesting, because, of course, I
have been listening to these three and Dr. Caccamo and I, I
think, both share the fact that KCMC was so exciting and such
an example that it just feels tragic that it fell apart in this
way, and in hearing the Mayor's and the Commissioner's
examples.
I guess I would say a couple of things. The first is that I
think we all share the view that not only the underlying
purpose, but the core standards of Head Start are critical,
that the research supports them and that the experience we have
all had about what it takes to reach these impoverished
children and make a difference in their lives. So that, I
think, is shared.
Second, listening to the descriptions of what might be
important, it makes me want to study these three examples.
Perhaps the Congress might do some fact finding across a
broader array to figure out--I am curious whether any of the
three programs had a visit by a senior HHS official, had
extensive technical assistance to go through the tangle. I
don't know whether in the Mayor's example whether anything does
need to change in the regulations or whether you just didn't
get the help you needed to operate in a strong way.
And so I think the question of what it needs to change in a
regulatory way versus how much of this is about technical
assistance, I think is an important question. So a commitment
to the standards, a commitment to strong onsite involvement and
technical assistance seems to me key.
And then, I guess, the other piece for me is that in all of
these examples, I do share your view, Senator Clinton, that
parent involvement substantively is part of what we know makes
Head Start work and I think that was shared also by all of the
panelists. So figuring out if there is a way to strengthen that
through the training and the board involvement and make sure
that that is happening in a way that supports the programs
rather than undercutting them.
I guess I did share the concern you expressed about the
idea of cutting the training and technical assistance overall
as a Head Start strategy, and I think the one thing I would
say, you mentioned the block grant question. I think what we
are learning more and more from the research is that what makes
early childhood programs work for children is high-quality
standards. As the Mayor said, it is the standards about what
happens in the classroom, that Head Start has rigorous
standards that are tied to the research, and that it is much
more consistent in enforcing them than the State pre-K or child
care programs.
So that what we have from Head Start that works for kids is
very high quality standards and a generally high quality and
rigorous monitoring, although as we have been seeing, one that
needs to be consistently supported. So I would go for the focus
on the high standards and the rigorous enforcement coupled with
the training, technical assistance, and support that enables
local leaders to do what they need to do to meet those
standards.
Senator Clinton. Mr. Chairman, I thank the witnesses, and
if I could maybe suggest that--I am so impressed by the
extraordinary thoughtfulness of each of them that perhaps if
they would have the time, the questions that Dr. Golden asked
to really get into the meat of it. I mean, did you get the help
you needed? Could there have been faster response from the
Federal Government? How do we streamline that? I see you
nodding, Commissioner Gates. Would you want to say something
real quickly?
Ms. Gates. I couldn't agree with you more. That was exactly
the problem that happened in Clark County. The Federal
Government came in too late. By that time, the problem had
escalated and escalated and it was unresolvable. If local
government, being the county, if they had taken our suggestion
and let us come in and help them, they probably would not have
been as tragic as it was or as it has been. So early
intervention is really key and important, and local involvement
is probably the most central point that I am hearing from the
Mayor, as well. You have to have that local control because
what happens to this program really hurts the whole community.
Senator Clinton. Thank you, Mr. Chairman.
Senator Alexander. I think a good way to end the hearing
will be to ask each of you if you have 60 seconds that you
would like to offer as a valedictory, as a last word, and then
invite you each, as you go back to your homes, within the next
week--we will keep the record open to write us with any
specific followups to the discussion that you have heard today,
following up Senator Clinton's suggestions.
Senator Ensign?
Senator Ensign. Thank you, Mr. Chairman.
Senator Alexander. Did I look over Senator Roberts? I guess
I did. I am sorry.
Senator Roberts. Normally, that is pretty tough to do,
but--
[Laughter.]
Senator Alexander. I apologize. Senator Roberts?
Senator Roberts. I would be happy to yield to Senator
Ensign. I have a tirade. You probably have a speech.
[Laughter.]
Senator Roberts. It all depends, Mr. Chairman. Do you want
the tirade first and the speech second?
Senator Alexander. Let us go to Senator Ensign.
[Laughter.]
Then we will let the tirade lift us up as we go out.
Senator Ensign. I appreciate that, Mr. Chairman. I, too,
have enjoyed the hearing today. I think it is very valuable and
I think all of us agree that the bottom line is how do we get
the dollars to help the kids and to help their families.
As Commissioner Gates has briefly mentioned, we have had
some serious problems in Southern Nevada. Northern Nevada is in
the opposite situation. We have an agency up there that is
functioning well and that is where I wanted to start with you,
Commissioner Gates. What suggestions specifically do you have
for us after going through the bad experience that we have had
in Southern Nevada, and comparing that to what we do have
Northern Nevada as a little different example? There are things
that we do better in Southern Nevada than they do in Northern
Nevada, but this happens to be one case that is just the
opposite.
What lessons can we learn from Nevada, as policy makers put
in place changes to try to prevent these problems and help
local governments like you, the Mayor and others prevent what
was going on in Southern Nevada at an earlier stage? What
specific suggestions can you give to us?
Ms. Gates. Mr. Chairman and members of the committee and
Senator Ensign, I think three things that are probably the most
critical that I would say.
No. 1, you can't have one agency be in charge of the whole
caboodle. That is designed for disaster, because if there is a
problem, then there is no one else to come in and take over and
to help.
No. 2, I think local government being involved, and I know
that the Mayor is involved, but we are not involved in Clark
County. The granting agency is a nonprofit agency, and if we
had an opportunity, because we consider ourselves partners
because we provided so many facilities and built so many
facilities that it was important for us to be involved, but
when we went to seek and try to assist, then that assistance
was turned down. I think it is important that local government
be involved in terms of providing assistance, providing fiscal
assistance. That is very critical.
And the last thing that I would say is that if local
government could, of course, have an opportunity, as the Mayor
has suggested, to be in charge of the Federal portion of the
moneys, overseeing the moneys or at least having some kind of
leadership role in making sure that those dollars are spent
properly, that would also be critical.
So those are the three things that I would suggest as a
government agency who really is concerned about the health and
education of all of these children here in Clark County.
Senator Ensign. Mr. Chairman, when we are talking about the
reauthorization of this program, I think that everybody is
concerned that we measure the results. Measure what is working,
the metrics of the program. I have talked at length about the
importance of metrics in personal conversations with Chairman
Enzi and also with the subcommittee chairman--that, first of
all, I think we need to measure what percentage of the dollars
are actually going to oversight? What percent of the dollars
are administrative expenses? And what percentage of the dollars
are getting to the children and getting to their actual
education in the classroom, because that is the most critical
piece to measure.
We need to ask, are the reforms that we want to put in
place going to make things worse? Are we going to spend more
money trying to chase the bad money, because frankly, we have
had some bad actors in this program. We had some bad actors in
Southern Nevada. It sounds like they had some bad actors in
Memphis, Tennessee. As they have said, you cannot legislate
morality. You cannot legislate moral people being involved in
these agencies. Are we putting into place based on programs
that are not working, something else that later on, 3 years
from now, we are going to have another hearing and discover
that the changes we made to solve the problem aren't working,
either.
In other words, I think we have to be careful as we are
going forward to make sure that the oversight is improved and
we have as much light shining on it as possible. That is the
problem that we saw with the EOB, is that they seemed
unaccountable to anybody. It sounds like with the Mayor that
you didn't know where the money was. You don't even know how to
get to the money. But at the same time, we have to make sure
that we aren't spending so much money going after bad actors
and that we are spending so much money in the bureaucracy that
the dollars aren't getting to the classroom. If anybody would
like to comment on that.
Mayor Wharton. May I? With respect to your observation on
not spending a lot more money that could more probably be
directed to outcomes for the children, I don't think that is
necessary, quite frankly. As indicated by the example I gave
just a few minutes ago with respect to the two delegate
agencies that I was able--that they relinquished or whatever
the phrase is here, that was strictly local and I simply sent
an auditor down there and there it was.
The key is not more Federal money, but more local
authority. I am not asking--oh, certainly, programmatically,
when it comes to teaching these children and assessing these
families and teaching literacy for the families, yes, we need
more money. But on this side of catching folks doing wrong, I
am not asking for more money for that. All I am asking for is
to give me some finality, some authority that when I get you,
you are gone. It weakens us as a government when I see what is
happening and I can't do anything about it.
So no, this is not a call for, give us more money,
particularly at the local level. Just give us more power to
straighten things out.
Ms. Gates. And I would echo those comments, as well.
Ms. Golden. And I think I would just take them one step
further to say that I think it is very useful for the committee
to reflect on that balance, on the fact that--and I think
Chairman Alexander highlighted it at the beginning, that it is
both about making sure there is integrity, fiscal integrity,
and about the results for children, that they are learning.
Perhaps in my 60 seconds at the end, I will highlight the
fact that there is a lot of really useful research going on now
that the committee may want to look at it in its
reauthorization that highlights what we know about the impact
that we are having on school readiness and what kinds of
standards and how it works. So there is a lot of knowledge
about that now to add to the committee's reflections.
Senator Ensign. Thank you, Mr. Chairman. I wish I had time
to stay around for Senator Roberts' tirade. I was kind of
looking forward to it.
[Laughter.]
Senator Alexander. Well, I hope he will forgive me for
jumping over him. Senator Roberts?
Senator Roberts. Thank you, Mr. Chairman.
Jim, again, thank you for taking the time out of your busy
schedule to be with us. This comes with good timing for bad
news again.
Yesterday, the Kansas City Star printed an article--it has
been an ongoing series of articles for several years about the
financial abuses of the Kansas City Head Start program, which,
I might add, as Ms. Golden indicated, all of these should be
synonymous with integrity. That is an oxymoron in this
particular case.
I want to point out that this center is not in Kansas, it
is in Missouri, and it is in Clay County, Platte County, and
Jackson County, but we have a very fine Head Start program in
Wyandotte County just across the river and this example
basically infected and contaminated all of our efforts.
The article is alarming. It details the corporate credit
card abuses of the former executive director of the program. To
quote the story, the former executive director's charges range
from items as small as a car wash, and let me point out that
those car washes cost $12,000, to flights overseas, and I could
go down the list. It would make your head swim. I am talking
about Godiva chocolates, wedding and anniversary gifts, trips
to the Caribbean, cowboy boots. In all, the executive director
of the Head Start program used his corporate credit card more
than 1,000 times--1,000 times--on purchases that totaled more
than $165,000. If there was a case of avarice and greed and
incompetence and remarkable arrogance, I don't know where there
is any better case. He got paid $814,000 over a 3-year period.
Now, what was the reaction? Federal auditors never looked
at the credit card charges at KCMC in reviews done every 3
years. Even after KCMC's controller pleaded guilty--he is in
jail--in 2002 to bribery and money laundering, Federal
officials acknowledged that auditors failed to scrutinize
Crompton's credit card or travel expenses in review just 2
months later. Instead, auditors applauded the KCMC for
exemplary service. They found the board and management well
informed, including about agency finances.
But the board members said last year, 2 years later, that
they had been unaware of Crompton's spending and the agency's
financial woes beyond the fraud in December. The agency,
millions of dollars in debt, gave up its Head Start grant. A
Denver firm stepped in to operate the program, which serves
2,700 preschoolers in Jackson, Clay, and Platte County until
the Federal Government finds a new agency. Jim is probably up
on that in terms of where we are in that regard.
Now the Governor of Missouri is launching another
investigation. It ain't over. It ain't over until it is over.
This ain't North Carolina and Illinois. It ain't over. And so
in Wyandotte County, we have to live with that right across the
river, and I can't tell you how upset I am.
I have visited a center in Wyandotte County. When I
visited, this is just about the time this story was breaking
and people had come up to me and said, ``Do you think this is
going to endanger the program?'' And I said, ``Well, it sure as
heck isn't going to help.'' So, consequently, I went in and I
learned how to brush my teeth better and I read the book
Curious George to the kids, and then the director and I danced
to, ``You Are My Sunshine.''
[Laughter.]
I was not Fred Astaire. She was Ginger Rogers and the kids
really got a good kick out of that.
But at the same time this scandal was actually brewing, and
it is still not over, why, Mike Castle over on the House side,
with very good intentions, says, why don't we delegate this? We
can do it better in Delaware. We can handle it. And so we are
into devolution and a pilot program, so on and so forth, which
I oppose.
So I am upset about this and I am very glad that Jim came
up to give his testimony. I guess my questions really center on
the testimony, especially by Ms. Gates.
Ms. Gates, you said--I am just going to skip to the last--
``Congress may wish to consider restrictions on prohibiting ACF
from allocating all of its Head Start funding to a single
organization within a single large metropolitan area.'' With
your experience, in the Kansas City situation, do you think
such an approach would have helped?
And Jim, what in the heck are we doing in Kansas City to
get this thing back on track so that we don't have these kinds
of problems in the future?
Ms. Gates. Mr. Chairman and Senator Roberts, I couldn't
agree more. That has been the biggest problem in Clark County.
We had one grantee. And if we had an opportunity to have more
than one grantee, we probably wouldn't be in the situation that
we are in today. Obviously, in your situation, you have
experienced the same thing, but it was a little bit too late
for the Federal Government to come in.
And second, the fact that there is no proper training, and
just for your information, Mr. Chairman and members of the
committee, I was once on that board as a County Commissioner
and I got off of that board because of the internal problems
that the Mayor talked about in terms of the funding and fights
and so forth. It was better for me to be on the outside,
although I still helped them.
But having one agency in charge of over $20 million is
problematic.
Senator Roberts. Jim?
Mr. Caccamo. Yes, Senator. I go back and forth on this
relative to Kansas City, about whether it should be broken up
or be one agency. Please remember that what goes on for boys
and girls, what goes on for parents and comprehensive services
is very strong. We don't have programmatic problems. What we
have is finance and government, and I am sorry that Senator
Enzi left because I want to tell him that we are appalled by
it. We are appalled. The juxtaposition of an executive director
who could run such comprehensive programs for children and
families against the use of the credit card and other
governance and finance problems has appalled our community.
Now, to break it up might help, but keep in mind that
programmatically, it is solid. I think there are other
solutions in our community that I spoke to already that would
help resolve the issue of financing government. If in Clark
County there is another solution, I think the law ought to
allow--ACF ought to allow for multiple. But I don't think there
is a cookie cutter. The reason I think Head Start works for so
many boys and girls and families is that there is community
reflection in all of these programs, most of the time for the
good.
Senator Roberts. Well, thank you, Jim, for your effort, and
thank all of you for your testimony.
After my visit in this one center, a young lady came up to
me, and I said we were singing ``You Are My Sunshine.'' The
sunshine in that center came from her eyes. She was a graduate
of that program 20-some years previously and her daughter is in
that program now and it is a success story. And you are right.
We are all appalled. This is a case that has been most
damaging. This particular example is a lot like asking for a
neck massage from the Boston Strangler in regards to the
program.
[Laughter.]
I am very upset about it and it has taken 3 years to get
this doggone thing on track and it is not over because now the
Missouri Governor is going to launch an investigation. I have
the privilege of representing Kansas, but again, because of the
border situation, it reflects on the entire program.
So I really appreciate your efforts for the clean-up, and
Mr. Mayor, I certainly sympathize with your situation, and Mr.
Chairman, thank you for your leadership.
Senator Alexander. Thank you, Senator Roberts.
This has been an exceptionally good hearing, both from the
Senators' participation and especially from the witnesses. We
would like to thank each of you for coming, some of you from
long distances, to be here today. We know you have busy
schedules.
As I mentioned earlier, we are going to keep the record
open for a week. You have heard the discussion. Maybe it raised
some thoughts in your mind. We are looking at whether we should
reauthorize Head Start in the next few months. We need to do
that. We need to do that working together, and we want to
improve accountability. We want to make it easier for the money
we appropriate to help children and we need specific
suggestions from you. You have already given us some ideas
about how to do that.
Now, let us end the hearing. We will go right down the row.
Why don't we start with you, Mr. Caccamo, and Mayor Wharton,
Commissioner Gates, Dr. Golden. Sixty seconds, what would you
like to leave us with?
Mr. Caccamo. I think I can do it in less than that,
although the people at home would be surprised.
[Laughter.]
Keep in mind that Head Start works. We have high
performance standards, comprehensive services, parent
engagement, and community involvement. Those are strengths and
it works in most of our communities.
There are bad things, too, and the bad things in our case
was the governance problem, financial problems, which I think
came about because of lack of board attention. We will address
that, Senator.
Senator Alexander. Thank you, sir.
Mayor Wharton?
Mayor Wharton. Thank you, Mr. Chairman, and thanks to you
and the committee members for convening this hearing. I will go
back to my basic points. More local control in dealing with
errant agencies. Give us some finality there.
I would have a word of caution with respect to having more
than one grantee, particularly in those instances where, in my
case, I am responsible for funding public schools. I think what
we should require is some cooperation or collaboration between
the Head Start programs and our systems of public education.
The Governor is getting ready to start a pre-K program, but
nobody has called me to say, how can you fit that $22 million
you already get into that? I think if we start breaking it up,
we may work against the purpose of integrating what is taught
in Head Start with what goes on from pre-K on up. So I would
caution against breaking it up.
Programs should be required to have some CIP program built
in, not how they are going to correct what they have done wrong
but how they are going to get better. That ought to be built
into the program, a continuous improvement process or whatever.
And I think there should just, again, over and over, more
local control in dealing with agencies that for whatever reason
have not complied. Thank you.
Senator Alexander. Thank you, Mayor Wharton.
Commissioner Gates?
Ms. Gates. Mr. Chairman, thank you. Again, I want to just
reiterate that Head Start does work and it certainly works in
Clark County. But I would add three things.
Early Federal intervention with proper training of staff is
important.
Expand fiscal review and control by local government,
making sure that local government is involved.
And then last, have the flexibility to have more than one
grantee in a large metropolitan area, such as Clark County.
Senator Alexander. Thank you, Commissioner Gates.
Dr. Golden?
Ms. Golden. I think I would also make three points. I would
start with the Head Start works point and just note that the
more that school readiness and early learning are on our minds
in this country, and we know from the research both that Head
Start makes a difference and we know some things about how it
makes a difference.
So the second point would be that how it makes a difference
is through high and rigorous standards and strong enforcement
and strong involvement of partners around those standards, so
that is key.
And the third theme, which I have just heard throughout the
conversation today, is really, I think, a theme about
balancing, about making sure you have strong programs and
strong fiscal integrity, that you have strong Federal oversight
that doesn't squash but invites local partnerships, and I think
that theme of how to balance those things in the service of the
goals that we know we all have was really what came through to
me most strongly.
Senator Alexander. Thank you. That is very helpful. And for
my 60 seconds, I think you took about the first 30 seconds of
it because that balance that you speak of, I think, is
critically important. It is too frequently the case when there
is a problem and the Federal Government gets involved that we
become overly prescriptive about how to fix things from here.
There is no more wisdom here than there is in Memphis or Kansas
City or anywhere else, often less. So we need our standards and
we need to watch the money from here.
But at the same time, we are likely to get a better result
if we have, as several of you have emphasized, clear
accountability at the local grantee level, in other words,
somebody in charge and somebody who can fix it if it goes
wrong. And if you can help us keep that balance, we will be
able to continue to have autonomous units around the country,
which was the original idea, local control, parent involvement,
good programming, hopefully better outcomes. The more we have
learned about preschool education, the more we want, as several
of you have suggested. More cognitive learning; we want to know
whether that is happening. We want to know whether there are
results as a result of the health screenings, those sorts of
outcomes.
We want the money to go where it goes, but we don't want to
squash the ability of local officials to take charge and
produce good results.
Thank you very much. The hearing is adjourned.
[Whereupon, at 12:01 p.m., the subcommittee was adjourned.]