between church and state? See for examples, Lemon v. Kurtzman and DiCenso v. Robinson.

The proposed legislation would quite probably meet the second test, for unlike other suggestions of direct institutional aid which would require sustained and detailed state supervision, this proposal would require no official scrutiny of institutional programs, since the financial benefits would accrue directly to the parents involved, and not to the educational institution.

However, the indirection of the aid to be granted cannot obscure the fact that the proposal is one intended to succor the financially-distressed private and parochial institutions. The primary purpose and effect, then, is to aid, and thus in Constitutional terms, to "establish" predominantly sectarian institutions, S.2142 fails to meet the first Constitutional test promulgated by the Supreme Court of our land.

It could be argued that the proposed legislation is merely a tax relief or, more specifically, an income-redistribution scheme. If that is indeed its purpose, the end sought would be better accomplished through means which are not of questionable constitutionality.

Justice Douglas, in his opinion in the Lemon v. Kurtzman case, cautioned that "sophisticated attempts to avoid the Constitution are just as invalid as simple. minded ones." The Horace Mann League of the United States of America concurs with this statement, and stands in firm opposition to the Packwood-Moynihan bill.

Respectfully submitted.

PAUL W. ROSSEY, President.

STATEMENT OF THE ASSOCIATION OF AMERICAN PUBLISHERS "We must be careful lest our campuses be occupied principally by those at the poverty level, who qualify for special aid, and those from the upper income brackets, who can afford to pay-a campus peopled only by the very rich and the very poor, pricing out the middle income, is also violative of the American system."-Page 576 of Sen. Rpt. 92-604 (Education Amendments of 1972).

"To fail education is to be penny wise and people foolish"-Adlai Stevenson.

The Association of American Publishers (AAP) is the general association of book publishers in the United States. It comprises the General Publishing Division, Direct Marketing/Book Club Division, Technical, Scientific and Medical Division, International Division, College Division, Mass Paperback Division, and School Division. Our 327 member publishing houses produce the vast majority of general trade, educational, reference, professional and religious books published in this country. AAP members publish 80% of the instructional materials used in the nation's classrooms.

The Association of American Publisher's supports the enactment of legislation providing a tax credit for higher education tuition payments.

Both in the Senate debates on tuition tax credit and in testimony before this committee, statements have repeatedly detailed the increasingly high cost of a college education. It is a fact that student costs at some colleges range upward from $7,000 for the current year. Even costs at public four-year colleges average some $3,000, which means some are lower and some even higher.

All this adds up to the fact that a middle-income family may have to spend as much as one-fourth to one-half of its after-tax income to send a son or daughter to college. For example, if a parent who is making $30,000 a year and paying about 40 percent of his earnings in federal, state and local taxes sends his son to MIT, the $8,000 cost for tuition, room and board represents more than a third of his $18,000 after-tax earnings. If there is more than one child of college age, the family burden becomes so onerous as seriously to curb ambitions for a higher education.

There is little question but that cost factors affect college enrollments which are now leveling off. There has been a decrease in enrollments of young Americans (age 18 to 24) who are dependent upon their parents for expenses; at the same time, there has been an increase in part-time students who today comprise more than half of all college students, which reflects the greater need to earn tuition and expense money by holding at least a part-time job.

To-date, the focus of congressional testimony has been on the plight of the family with children who desire a college education. But what of the older students, over 35, who today comprise more than a third of all college students? For the most part, they are individuals of modest income who, moreover, lack full access to federal and state student assistance programs. They must pay their own way.

The Congress, in the Education Amendments of 1974 (sec. 801 of Public Law 93-380), declared “it to be the policy of the United States of America that every citizen is entitled to an education to meet his or her full potential without financial barriers." Enactment of tax credit for college tuition would be consistent with that declaration. We urge passage of such a measure.

STATEMENT OF MONROE CITIZENS FOR PUBLIC EDUCATION AND RELIGIOUS LIBERTY, MARTHA LATIES, CHAIRMAN

My name is Martha Laties. I am the Chairman of Monroe Citizens for Public Education and Religious Liberty (MCPEARL). MCPEARL is a Monroe County New York, coalition working to keep public funds for public schools only.

MCPEARL is dedicated to the protection of free public education, open to all children; and committed to the preservation of religious liberty as guaranteed by both the Federal and state constitutions.

MCPEARL opposes S. 242, the Tuition Tax Credit Act, because the act would violate the First Amendment of the U.S. Constitution and because it would undermine public elementary and secondary schools.

S. 2142 would violate the First Amendment of the U.S. Constitution, which forbids government establishment of religion, by funding schools of pervasive religious character by means of Federal income tax credits and grants for tuition paid to those schools.

In 1973, the U.S. Supreme Court found unconstitutional a similar New York State law, which authorized state income tax credits and grants for tuition paid to nonpublic schools of pervasive religious character. The case was Committee for Public Education and Religious Liberty (PEARL) v Nyquist. The Court said, "Insofar as such benefits render assistance to parents who send their children to sectarian schools, their purpose and effect are to aid and advance those religious institutions."

Furthermore, since S. 2142 would fund schools through tuition reimbursements, the elementary and secondary schools funded would be the nonpublic schools, which charge tuition. Government support of private schools weakens the public schools. Private schools select their students. They choose the brightest and best-behaved and return children with learning and behavior problems to the public schools. The public schools then must deal with a disproportionate number of children who are difficult to teach and whose presence creates a poorer learning atmosphere for all children. The poorer learning environment then drives able children from public schools to private schools, and the learning environment becomes even worse. Public schools tend to become refuges for the children no private school will accept. Public schools located in poor neighborhoods of big cities have already suffered from this effect.

Federal funds should be used to strengthen those schools and to reverse the downward trend, but S. 2142 would use Federal funds to speed the decline of public schools already in trouble and would push some which are now holding their own onto the downward slide.

To protect religious liberty, to uphold the U.S. Constitution, and to support public elementary and secondary education, please reject S. 2142.

STATEMENT OF M. K. CURRY, JR., PRESIDENT OF BISHOP COLLEGE AND PRESIDENT OF THE UNITED NEGRO COLLEGE FUND

The 41 member post-secondary four year private institutions of the United Negro College Fund has enrollments of over 80 percent of its students on financial aid. Since a majority of these students come from families with total income less than $6,000 a year, our concerns regarding tuition relief for their families are paramount.

For the last four years we have been asked by Congress for our views and

recommendations on how low-income students might best be assisted. It is in Congressional testimony that we believe that the campus-based student assistance programs at present, are the best mechanisms for assuring access and choice for low-income students. If the present student aid programs were ever adequately funded, it would be a sound step in eliminating the disparity between the affluent and the poor and the chance for all Americans to have a good education.

We too, are interested in how best middle-income families can be assisted so that access and choice is also guaranteed them. I might venture to say that the children of our graduates would fall into this middle-income bracket; thus, our concerns are great. But, as we attempt to solve this dual problem, let us not deplete one program for the other. We must realize that the poor have less access to all the varieties of remedies that are available to help them solve their problems, while the middle class has a much stronger voice in Congress, as well as, greater access for private loans and arrangements.

It is our belief, therefore, that if Tuition Tax Credits are approved, they will do much to undermine the present structure of student assistance programs which are now targeted toward that percentage of the American population that needs that assistance the most.

It is our belief that if Tuition Tax Credits are realized, these are the possible negative effects:

1. THEY ARE NOT DIRECTED TOWARD THOSE SEGMENTS OF THE POPULATION THAT ARE IN MOST NEED OF STUDENT ASSISTANCE

(a) If our understanding of S2142 is correct, a nonrefundable tax credit would not benefit those in most need of assistance. Many low-income families do not pay taxes anyway, thus eliminating participation by this group. Under the same program, high wage earners could benefit from the tax credit greatly by sending their children to low tuition public institutions. This fact also discourages attendance by the population at private, post-secondary institutions.

(b) A refundable tax credit could greatly benefit the wealthy. They would have the same tax credit as the low-income family. The Treasury Department in this instance, would be short-changing itself and the general taxpayer would be paying to educate the wealthy.

Currently, there are federal loan programs already in place to assist middleincome families-the Guaranteed Student Loan Program, National Direct Student Loans, and College Work-Study Program. Over the last several years, the eligibility requirements have been raised to include greater middle-income participation. This is also true of the BEOG (Basic Educational Opportunities Grant), and the SEOG (Supplemental Educational Opportunities Grant) Programs. The UNCF has gone on record for supporting the BEOG Program to be totally directed exclusively toward the very low-income families in our nation. We have not been that stringent toward the SEOG and other student aid programs, because we realize some compromise must be reached to accommodate more of the moderate and middle-income families who are also suffering from skyrocketing tuition costs.

We support increased appropriations for the presently functioning student aid programs so that moderate and middle-income families can be included without dissipating monies presently available for the very low-income,

2. THE TUITION TAX CREDIT COULD FORESEEABLY DIMINISH FUNDS CURRENTLY BEING ALLOCATED FOR STUDENT ASSISTANCE PROGRAMS

It has been suggested that the Treasury Department would lose close to $4.7 billion annually, if the Tuition Tax Credit were to become a reality. There is a likely chance that this large amount of money would be used as a leverage to decrease current student assistance programs which have already been changed to include the middle-income group. The end result would be that the most deserving group (the most needy), would receive less.

3. THERE IS A REASONABLE ASSUMPTION THAT TUITION TAX CREDITS WOULD DIMINISH FINANCIAL SUPPORT FROM THE PRIVATE SECTOR AND STATE GOVERNMENTS

(a) Many contributors from the private sector who traditionally give to help poor students may believe that their gifts are no longer needed. This erroneous conclusion would place a heavy financial burden on educational charitable groups to prove to donors that their contributions would still be needed even

more so by the poor. There is fear that it will undermine fundraising efforts currently being conducted in support of the most needy students.

(b) The states may feel that they no longer need to channel funds into financial assistance programs for students, since there will be a tuition tax credit. The state could easily find other areas to transfer education monies. These are serious possibilities which must be thoroughly analyzed before such legislation is passed.

4. INCREASED ADMINISTRATIVE BURDEN ON THE SMALL, PRIVATE INSTITUTIONS THAT ARE ALREADY OVERBURDENED WITH FEDERAL REPORTING REQUIREMENTS The higher education community has voiced repeatedly its already deep concern over the prolific amount of paper work that goes into maintaining federal educational programs. This tuition credit would only add to that burden, thus helping to suffocate administratively, the smaller, struggling institutionsmany of which are serving those students most in financial need.

Many institutions, both public and private, will be inclined to raise their tuition to correlate with the tax credit allowance. This would, ultimately, undermine any attempt by poor families to gain access to high cost, private institutions. It would seem to me at this stage of the development of the student aid programs, with greater emphasis being placed on inclusion of middle-income families, it would be wiser to try and solve these problems within the context of present legislation before we splinter up student assistance programs. This seems appropriate, especially in light of all the negatives that the Tuition Tax Credit would apparently create. We therefore, recommend postponement of all current Tuition Tax Credit legislation.

STATEMENT OF WALTER G. DAVIS, DIRECTOR OF EDUCATION, AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS

I am pleased to submit my views today on behalf of the AFL-CIO and its 14 million members. The AFL-CIO is vitally interested in education because we not only represent teachers, administrators, office workers and maintenance workers but also because of our consumer interest in representing our children's stake in these public policy decisions and our members' stake in lifelong learning opportunities.

The working people of America believe now as they believed in the early days of this country that quality education for their children and for themselves is a priority consideration in the improved quality of life to which we all aspire. As many of you realize, it was our predecessors in organized labor who first lobbied for the concept of free universal public education.

In 1832 the Philadelphia trade unions issued a report calling for free public schools in every part of the state to be governed by publicly elected school boards. In the same period, 1829, the Working Man's Party called for a free public school system which would "unite under one roof the children of the poor men and the children of the rich".

Vigorous labor support for education has been documented in convention statements since the funding of the AFL in 1881. We stand firmly behind the same concerns for quality education for all today. It is for this very reason that we are opposed to the concept of tuition tax credits for we feel such measures will divert needed funds from programs that would much more effectively target aid to those who need it most.

It is our strong conviction that tax credits could also do irreparable harm to the nation's public school system:

They would provide avenues of evasion for full integration of the public schools by subsidizing directly or indirectly those schools which discriminate against minorities in their admissions policies.

They would drain needed budgetary funds for an already inadequate federal education support program. A major bill before this committee is estimated at a revenue loss of about 4.7 billion in 1980. That's an amount equivalent to a 35 percent increase in total federal outlays expected in that year for all higher education, elementary, secondary and vocational education and research. That same 4.7 billion is double the amount of funds requested for the Basic Opportunity Grant program which directly targets federal education aid to undergraduates who need it.

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They would provide little if any help to those most in need of the education dollars and at the same time provide windfall tax relief to the wealthy. According to AFL-CIO Research Department estimates approximately 25 percent of the benefits of the tax credit would go to the 10 percent of the nation's taxpayers whose adjusted gross incomes exceed $30,000 a year.

Opposition to tuition tax credit should not be interpreted to imply that we are opposed to support for nonpublic schools. This is not the case. We have consistently advocated that all eligible children should qualify for federal and state programs of assistance whether they are enrolled in public or nonpublic schools. What we are saying is the we do not believe that the tax relief route is an efficient way to address the problems of financing nonpublic schools.

We do not believe that providing preferential tax relief, in effect a tax subsidy, is appropriate tax policy or educational policy. It will neither promote the goals of tax equity, tax simplification nor the goal of increased educational opportunties.

We likewise do not feel that a tax subsidy will reduce the rising costs of higher education in our view just the opposite would result. We believe, ideally, that post secondary education should be free and open to all who can qualify and benefit from this experience. Realistically, we know this is not in the immediate future but the concept remains as our long range goal for the nation.

In the meantime, public policy should be aimed at providing the opportunity for post secondary education to all those students most in need of financial assistance. To that end we call for full funding of the student aid programs now in place.

We are as concerned as any of the sponsors of tuition relief bills submitted to the Congress that many moderate and middle income children have been priced out of the higher education market. We know this group is having the largest rate of decline in enrollment. However, we believe that specifically targeted aid to those groups most in need is a far more effective use of available federal funds. For example, we urge the increased funding of the Basic Opportunity Grants to provide tuition relief for families with adjusted gross incomes up to $25.000. We urge the full support of the Guaranteed Student Loan program. We urge full funding for the Cooperative Education program and strongly disagree with its proposed phaseout.

And finally, we believe tax proposals such as the ones before this committee would be an open invitation to raise tuition charges and thereby further negate any possible benefits to the moderate and middle income groups.

EDUCATION

Education in America will face its greatest challenge in the last quarter of the century. Accelerated change in educational needs today requires a deeper analysis of future expectations from the society at large.

Vocational educators need to know what should be taught. Some 54%1⁄2 million Americans above the age of 16 have been characterized as functional illiteratesa devastating statistic for the most advanced society in the world. The spiralling cost of higher education has shut the doors of many small, private colleges and effectively restricted access to the sons and daughters of workers whose incomes fall between affluence and poverty.

The past two decades were turbulent for American education. The post-World War II "baby boom" threw schools into a crisis; school construction had not kept apace of the mounting enrollments; classrooms were overcrowded and many sub-standard; teachers were in short supply and woefully underpaid. Evidence mounted to prove a gross inequality of education opportunity existed among students in the same district. Students enrolled in vocational schools worked on out-of-date equipment never found in the workplace, and many vocational students were in fact written off as misfits and castoffs who could not make it in academic programs.

To these problems was added the financial crisis created by the migration to the suburbs in most metropolitan areas, leaving cities with an eroded tax base and the expensive problem of trying to teach large concentrations of educationally-deprived students. Many suburbs found it necessary to rapidly expand their school systems far beyond immediate financial resources.

It was in the midst of that crisis situation that Congress, under the leadership of Presidents Kennedy and Johnson, passed a succession of education bills,