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[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]

 
                         WELFARE REFORM SUCCESS
=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON HUMAN RESOURCES

                                 of the

                      COMMITTEE ON WAYS AND MEANS
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             APRIL 2, 2002

                      University Center, Michigan

                               __________

                           Serial No. 107-88

                               __________

         Printed for the use of the Committee on Ways and Means

                           U.S. GOVERNMENT PRINTING OFFICE
84-500                            WASHINGTON : 2003
___________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512-1800  
Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001

                      COMMITTEE ON WAYS AND MEANS

                   BILL THOMAS, California, Chairman

PHILIP M. CRANE, Illinois            CHARLES B. RANGEL, New York
E. CLAY SHAW, Jr., Florida           FORTNEY PETE STARK, California
NANCY L. JOHNSON, Connecticut        ROBERT T. MATSUI, California
AMO HOUGHTON, New York               WILLIAM J. COYNE, Pennsylvania
WALLY HERGER, California             SANDER M. LEVIN, Michigan
JIM McCRERY, Louisiana               BENJAMIN L. CARDIN, Maryland
DAVE CAMP, Michigan                  JIM McDERMOTT, Washington
JIM RAMSTAD, Minnesota               GERALD D. KLECZKA, Wisconsin
JIM NUSSLE, Iowa                     JOHN LEWIS, Georgia
SAM JOHNSON, Texas                   RICHARD E. NEAL, Massachusetts
JENNIFER DUNN, Washington            MICHAEL R. McNULTY, New York
MAC COLLINS, Georgia                 WILLIAM J. JEFFERSON, Louisiana
ROB PORTMAN, Ohio                    JOHN S. TANNER, Tennessee
PHIL ENGLISH, Pennsylvania           XAVIER BECERRA, California
WES WATKINS, Oklahoma                KAREN L. THURMAN, Florida
J.D. HAYWORTH, Arizona               LLOYD DOGGETT, Texas
JERRY WELLER, Illinois               EARL POMEROY, North Dakota
KENNY C. HULSHOF, Missouri
SCOTT McINNIS, Colorado
RON LEWIS, Kentucky
MARK FOLEY, Florida
KEVIN BRADY, Texas
PAUL RYAN, Wisconsin
                     Allison Giles, Chief of Staff
                  Janice Mays, Minority Chief Counsel
                                 ------                                

                    Subcommittee on Human Resources

                   WALLY HERGER, California, Chairman

NANCY L. JOHNSON, Connecticut        BENJAMIN L. CARDIN, Maryland
WES WATKINS, Oklahoma                FORTNEY PETE STARK, California
SCOTT McINNIS, Colorado              SANDER M. LEVIN, Michigan
JIM McCRERY, Louisiana               JIM McDERMOTT, Washington
DAVE CAMP, Michigan                  LLOYD DOGGETT, Texas
PHIL ENGLISH, Pennsylvania
RON LEWIS, Kentucky

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Ways and Means are also published 
in electronic form. The printed hearing record remains the official 
version. Because electronic submissions are used to prepare both 
printed and electronic versions of the hearing record, the process of 
converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.

                            C O N T E N T S

                              ----------                              
                                                                   Page
Advisory of March 25, 2002, announcing the hearing...............     2

                               WITNESSES

Carter, Darnell, Detroit, Michigan...............................    16
Cascade Engineering, Fred P. Keller..............................    19
Family Independence Agency, Lori Scorsone........................    23
Hudson, Lisa, Grand Rapids, Michigan.............................    17
Koon, Carol, Evart, Michigan.....................................    15
Michigan, State of, Hon. John Engler, Governor, and National 
  Governors' Association.........................................     5

                         WELFARE REFORM SUCCESS

                              ----------                              

                         TUESDAY, APRIL 2, 2002

                  House of Representatives,
                       Committee on Ways and Means,
                           Subcommittee on Human Resources,
                                       University Center, Michigan.
    The Subcommittee met, pursuant to notice, at 11:00 a.m., at 
the Rhea Miller Recital Hall, Saginaw Valley State University, 
University Center, Michigan, Hon. Dave Camp presiding.
    [The advisory announcing the hearing follows:]

ADVISORY

FROM THE 
COMMITTEE
 ON WAYS 
AND 
MEANS

                    SUBCOMMITTEE ON HUMAN RESOURCES

                                                CONTACT: (202) 225-1025
FOR IMMEDIATE RELEASE
March 25, 2002
No. HR-13

        Herger Announces Field Hearing on Welfare Reform Success

    Congressman Wally Herger (R-CA), Chairman, Subcommittee on Human 
Resources of the Committee on Ways and Means, today announced that the 
Subcommittee will hold a field hearing on welfare reform success 
stories. The hearing will take place on Tuesday, April 2, 2002, in the 
Rhea Miller Recital Hall, Saginaw Valley State University, 7400 Bay 
Road, University Center, Michigan, beginning at 11:00 a.m.

    In view of the limited time available to hear witnesses, oral 
testimony at this hearing will be from invited witnesses only. 
Witnesses will include Michigan Governor John Engler as well as former 
welfare recipients, a welfare caseworker, and an employer who has hired 
welfare recipients. However, any individual or organization not 
scheduled for an oral appearance may submit a written statement for 
consideration by the Subcommittee and for inclusion in the printed 
record of the hearing.

BACKGROUND:

    The Personal Responsibility and Work Opportunity Reconciliation Act 
of 1996 (P.L. 104-193), commonly referred to as the 1996 Welfare Reform 
Law, made dramatic changes in the Federal-State welfare system designed 
to aid low-income American families. The law repealed the former Aid to 
Families with Dependent Children program, and with it the individual 
entitlement to cash welfare benefits. In its place, the 1996 
legislation created a new Temporary Assistance for Needy Families block 
grant, which provides fixed funding to States to operate programs 
designed to achieve several purposes: (1) provide assistance to needy 
families, (2) end the dependence of needy parents on government 
benefits by promoting job preparation, work, and marriage, (3) prevent 
and reduce the incidence of out-of-wedlock pregnancies, and (4) 
encourage the formation and maintenance of two-parent families.

    National figures point to remarkable progress in combating welfare 
dependence and poverty since State and Federal welfare reforms were 
enacted in the mid-1990s. The number of children living in poverty has 
dropped by nearly 3 million and the African-American child poverty rate 
has fallen to a record low; welfare caseloads have fallen by 60 percent 
nationwide, as nearly 3 million families and 9 million recipients have 
left welfare; and record numbers of current and former welfare 
recipients are working.

    In announcing the hearing, Chairman Herger stated: ``Welfare reform 
has been a tremendous success in terms of reducing poverty, ending 
dependence, and promoting work. But behind all of the remarkable 
statistics are millions of families working their way off of welfare 
and into the mainstream of American life. This hearing will allow us to 
hear some personal accounts of how reform has worked in Michigan, which 
will help set the stage as we prepare to extend and improve the 
national 1996 welfare reforms in the coming months.''

FOCUS OF THE HEARING:

    The Subcommittee will review welfare reform outcomes in Michigan, 
with a focus on the perspective of former recipients, employers and 
caseworkers who have been instrumental in the success of the State's 
program in terms of reducing poverty, ending dependence, and promoting 
work.

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

    Please Note: Due to the change in House mail policy, any person or 
organization wishing to submit a written statement for the printed 
record of the hearing should send it electronically to 
[email protected], along with a fax copy to 
(202) 225-2610, by the close of business, Tuesday, April 16, 2002. If 
those filing written statements, other than invited witnesses, wish to 
have their statements distributed to the press and interested public at 
the hearing, they may deliver 150 additional copies for this purpose to 
the district office of Representative Dave Camp, 135 Ashman Drive, 
Midland, Michigan 48640, by close of business on Monday, April 1, 2002.

FORMATTING REQUIREMENTS:

    Each statement presented for printing to the Committee by a 
witness, any written statement or exhibit submitted for the printed 
record or any written comments in response to a request for written 
comments must conform to the guidelines listed below. Any statement or 
exhibit not in compliance with these guidelines will not be printed, 
but will be maintained in the Committee files for review and use by the 
Committee.

    1. Due to the change in House mail policy, all statements and any 
accompanying exhibits for printing must be submitted electronically to 
[email protected], along with a fax copy to 
(202) 225-2610, in Word Perfect or MS Word format and MUST NOT exceed a 
total of 10 pages including attachments. Witnesses are advised that the 
Committee will rely on electronic submissions for printing the official 
hearing record.

    2. Copies of whole documents submitted as exhibit material will not 
be accepted for printing. Instead, exhibit material should be 
referenced and quoted or paraphrased. All exhibit material not meeting 
these specifications will be maintained in the Committee files for 
review and use by the Committee.

    3. Any statements must include a list of all clients, persons, or 
organizations on whose behalf the witness appears. A supplemental sheet 
must accompany each statement listing the name, company, address, 
telephone and fax numbers of each witness.

    Note: All Committee advisories and news releases are available on 
the World Wide Web at http://waysandmeans.house.gov.

    The Committee seeks to make its facilities accessible to persons 
with disabilities. If you are in need of special accommodations, please 
call (202) 225-1721 or (202) 226-3411 TTD/TTY in advance of the event 
(four business days notice is requested). Questions with regard to 
special accommodation needs in general (including availability of 
Committee materials in alternative formats) may be directed to the 
Committee as noted above.

                               

    Mr. CAMP. Good morning. First of all, I want to thank 
everybody for coming. I'm really pleased that this hearing is 
taking place in Michigan, in Saginaw County, and at Saginaw 
Valley State University. I want to thank President Eric 
Gilbertson and Jean Hamilton for making it possible that we're 
here.
    I think it's important for the Congress to get the State 
perspective on welfare reform, and a local perspective, not 
just what we hear from witnesses that are able to travel to 
Washington.
    I also want to thank the Chairman of the Subcommittee on 
Human Resources of the Committee on Ways and Means, Wally 
Herger, for allowing this tremendous opportunity to have the 
hearing in Michigan. Also, I want to acknowledge the invaluable 
assistance that Matt Weidinger, the Subcommittee Staff 
Director, Katie Kitchin, and Ryan Work of the Subcommittee who 
have all provided, as well as my own staff, Dedra Clancy, help 
to make this hearing happen.
    Today's hearing will provide my Subcommittee Members and 
other colleagues from Michigan an important background for this 
year's re-authorization as we consider welfare reform outcomes 
in Michigan. It will focus on the perspective of former 
recipients, caseworkers and employers who have been 
instrumental in the success of the State's program in terms of 
reducing poverty, ending dependence and promoting work. With 
Governor Engler's lead, Michigan was at the forefront of the 
National Welfare Reform effort when it began experimenting with 
welfare reform in the early nineties. It was the innovative 
State thinking that the Governor and other legislatures--and I 
know we have a number of them here in attendance--Senator Joel 
Gougeon is here, Representative Jim Howell, Representative Tony 
Stamas, and Representative Carl Williams. I also know that Chad 
Arnold from Senator Dunaskiss's office is here. They have all 
been influential in Michigan's innovative approach to welfare 
reform.
    Just through the year 2000, the decline in welfare 
caseloads have resulted in the reduction of State spending on 
welfare by almost $775 million. Spending on child day care, 
employment programs, health care and other social services has 
climbed by almost $3 billion.
    On the national level, welfare reform has been a success by 
almost any measure which you can devise; successful in terms of 
reducing caseloads and moving millions of families out of 
poverty through work. We know that nearly 3 million children 
have been lifted from poverty since 1996. Employment by single 
parents most likely to go on welfare rose by 40 percent between 
1995 and 2000. Also, welfare caseloads have declined by 9 
million, from 14 million recipients in 1994, to just 5 million 
today.
    Welfare reform has increased work, boosted incomes, 
improved child poverty, while also reducing dependency. I'm 
proud of the achievements of the 1996 law and even prouder of 
the millions of parents who are now working and making better 
lives for themselves and their children.
    We are honored to have some parents with us here today, and 
we'll be hearing from them later. I look forward to learning 
about how they took advantage of the improved work support 
Michigan allows and how they were able to become independent.
    In the coming months, we have the opportunity to build on 
these successes and enhance this vital program. Congress should 
continue to help more people successfully transition to work, 
because work is the real and only permanent path out of 
poverty.
    I will say that joining us today will be the Governor of 
Michigan, John Engler, as well as former welfare recipients 
Carol Koon, Darnell Carter and Lisa Hudson. We are also joined 
by Lori Scorsone, a welfare caseworker, and Fred Keller, an 
employer who has hired welfare recipients. We look forward to 
hearing from all of our witnesses.
    [The opening statement of Mr. Camp follows:]

 Opening Statement of the Hon. Dave Camp, a Representative in Congress 
                       from the State of Michigan

    Good morning. First, I would like to say how pleased I am that this 
hearing is taking place here in Michigan because it is important for 
Congress to get the state perspective on welfare reform as well as a 
local perspective. Second, I would like to thank Chairman Wally Herger 
for this tremendous opportunity as well as acknowledge the invaluable 
assistance that Matt Weidinger, Subcommittee Staff Director, Katie 
Kitchin, and Ryan Work of the Subcommittee have all provided to make 
this hearing happen.
    Today's hearing will provide my Michigan colleagues and me an 
important background for this year's reauthorization as we consider 
welfare reform outcomes in Michigan. It will focus on the perspective 
of former recipients and caseworkers and employers who have been 
instrumental in the success of the State's program in terms of reducing 
poverty, ending dependence, and promoting work.
    With Governor Engler taking the lead, Michigan was at the forefront 
of the national welfare reform effort when it began experimenting with 
welfare reform in the early 1990s. Michigan's innovative thinking 
resulted in a dramatic change in spending priorities. For example, 
through the 2000 fiscal year, the decline in welfare caseloads had 
resulted in reduction of state spending on poverty relief of almost 
$775 million. However, spending on child day care, employment programs, 
health care and other social services had climbed by almost $3 billion.
    On the national level, welfare reform has been a tremendous success 
in reducing welfare caseloads and moving millions of families out of 
poverty through increased work. We know that nearly 3 million children 
have been lifted from poverty since 1996, employment by mothers most 
likely to go on welfare rose by 40% between 1995 and 2000; and welfare 
caseloads have fallen by 9 million--from 14 million recipients in 1994 
to just 5 million today.
    Welfare reform increased work, boosted incomes, improved child 
poverty while reducing dependency. I am proud of the achievements of 
the 1996 law, and even prouder of the millions of parents who are now 
working and making better lives for themselves and their children. We 
are honored to have several such parents with us today, and look 
forward to learning more about how they took advantage of the improved 
work supports Michigan and now so many other states provide.
    In the coming months, we have the opportunity to build on these 
successes and enhance this vital program. Congress should continue to 
help more people successfully transition to work, because work is the 
only real and permanent path out of poverty.
    Joining us today will be Governor John Engler as well as several 
former welfare recipients: Carol Koon, Darnell Carter, Crystal McClain, 
and Lisa Hudson. We also are joined by Lori Scorsone, a welfare 
caseworker, and Fred Keller, an employer who has hired welfare 
recipients. We look forward to hearing from all of our witnesses.

                               

    Mr. CAMP. Governor Engler will be our first witness. He was 
a key architect of Michigan's Welfare Reform, as well as, 
testifying on numerous occasions and helping craft the 1996 
Welfare Law.
    It is a great honor to have an opportunity to hear from the 
Governor of Michigan, John Engler. Welcome.

STATEMENT OF THE HON. JOHN ENGLER, GOVERNOR, STATE OF MICHIGAN, 
         AND CHAIRMAN, NATIONAL GOVERNORS' ASSOCIATION

    Mr. ENGLER. Well, thank you very much, Congressman Camp. I 
am delighted to be here today with you. I certainly want to 
thank you and express my appreciation to Chairman Herger and to 
the other Members of the Committee who asked me to testify 
today.
    I recall with great fondness 1995 and 1996 while there was 
an extraordinary amount of work being done, the leadership that 
you and then Subcommittee Chairman Congressman Clay Shaw and so 
many others provided. It was an important bit of work that was 
done. The results, as you just so eloquently stated, have truly 
changed America. For me to be able to come here today as not 
only the Governor of Michigan, but Chairman of the National 
Governors' Association, to a field hearing that's in the State 
of Michigan, it's an opportunity for us to talk about a record 
that we're very proud of. A record of welfare reform success, a 
record that shows, in our State, tens of thousands of families 
who successfully transitioned from dependency to independence, 
taking charge of their own lives, and taking charge of their 
family. So, it's a wonderful opportunity.
    I would also note, and I understand he's on business and 
out of the State, but Michigan is not only privileged to have 
you on this all important Subcommittee, but also Congressman 
Sander Levin from Oakland County. So, we do feel as though, in 
the policy debate in 2002, that our views will be heard and 
hopefully will be part of the consideration. This hearing here 
today shows that.
    I also want to express our appreciation from the Michigan 
officials, our Family Independence Agency (FIA) for my 
Washington office to Matt Weidinger and his staff at the 
Subcommittee level, as well as, the staff in the Minority. They 
have all been very, very open to us. So, I'm thrilled to be 
here.
    What I'll do this morning is maybe take a few moments and 
go through some of the prepared remarks.
    Mr. CAMP. All of the testimony will be part of the 
permanent record that will go back and be part of the 
Subcommittee's official record on this legislation.
    Mr. ENGLER. For some of our guests, we have--I just saw on 
the table outside, actually a chronology of welfare reform 
changes in Michigan, which is an interesting document. There 
are, I think, some limited copies of most of the testimony I'm 
going to present.
    Let me begin back in 1995 and 1996, because it was in 1996 
after two vetoes that Federal welfare reform was signed into 
law. The date was August 22. There were skeptics and many of 
them who had their doubts. They said bad things would happen. 
We have even had, as I recall, employees resigning in protest 
from the U.S. Department of Health and Human Services, and the 
argument was this: The States really weren't concerned or as 
compassionate about their citizens as people were in 
Washington. The argument was it would be a race to the bottom. 
Some advocates for the old system even claimed that some 2 
million children would be added to child poverty roles. The 
evidence is in. They were wrong.
    Welfare reform has worked and has exceeded the expectations 
of many of its staunchest supporters. States took very 
seriously the authority that was devolved by Congress, and I 
think earned a claim and trust through their actions and 
successes.
    The Federal legislation that you wrote succeeded because 
Congress debated, focused on and then sent overarching goals, 
such as families going to work and making assistance temporary. 
Then the strategies and the methods were largely left to the 
States. The key word: Flexibility. Michigan and other States 
have proven that given flexibility, States can design programs 
that fit their needs, better programs, deliver better services 
and bottom line, get better outcomes for families and 
taxpayers.
    Michigan's reform, as you've cited, alone have resulted in 
over 308,000 Michigan families leaving welfare with earned 
income. As we move forward now, this year, considering the 
subject again and re-authorization, I think everyone agrees. 
It's important to maintain work in unsubsidized private sector 
employment as a key goal. Employment reduces welfare 
dependency, strengthens families, and exposes our next 
generation of children with the all-important work ethic. If we 
lose work as a central theme, we would risk losing much of the 
gains that we've made over the last decade.
    I'm delighted that President Bush's proposal keeps work as 
a central focus, and I support his efforts to raise the bar. 
While some of the details are still emerging, we also believe 
there is additional opportunity within the President's 
proposal, as well as proposals that are coming forward in the 
Congress. The opportunity is to fine-tune the details so that 
current successful State programs can continue, and we can 
achieve even greater gains. I look forward and the Nations 
Governors look forward to being part of a process where States, 
leaders in Congress like yourself, the Subcommittee, and the 
administration work together to write a final product that 
recognizes the goal of work. At the same time--balances the 
changing mix of our caseloads. Some of the current State 
programs, available resources which at the State level and 
recent budget, really for sort of two budgets as we've dealt 
with a national recession, have become somewhat strained and at 
the same time certainly to maximize the all important 
flexibility for States.
    Again, the President's proposals are a tremendous starting 
point, given where this debate began back in 1995 when the 
proposals emerged from the new majority in the House and 
Congress of the United States. I mean, that's really where this 
debate began in 1995. Now, here we are a few short years later, 
and the President's coming in with a proposal that would have 
seemed absolutely radical in 1995 when we first began this 
conversation.
    Welfare reform is about strengthening families. Work 
strengthens family. However, for some families, work alone 
cannot be the only strategy to strengthen the families. In 
Michigan we've done many things we think that are designed to 
support strong family structures.
    Early on, fairer eligibility standards for two-parent 
families, targeted paternity establishment, priority of 
reducing out-of-wedlock births, family reunification and 
preservation initiatives, and a range of other family formation 
activities. Again, as was with the focus on work, I think it's 
critical that specific family formation strategies be largely 
left in the States.
    I'm pleased that the President has proposed for the 
Temporary Assistance for Needy Families (TANF) grants, a level 
of funding of the block. While at the same time, he's also 
addressed some other concerns that I think are real, and were 
in need of being addressed--a meaningful contingency fund for 
emergency situations. The ability of States to formally 
obligate unspent funds has been an open question during the 5 
years of this welfare reform legislation. The ongoing 
commitment of a multi-year block grant is, again, something 
else that's welcomed.
    Again, given the State's current physical situations, of 
course we'll also be looking for any opportunities that may 
arise to include other modest little economic increases or 
inflation factors to further supplement base TANF funding, 
should those materialize.
    At the same time, another key opportunity is one that would 
allow States to align and simplify other programs. Here, the 
President's proposed ``super-waiver'' authority could be one of 
the most exciting, innovative and effective things to come out 
of Washington in years.
    Families who receive cash are often caught in the trap of 
multiple and conflicting bureaucratic systems and programs, 
i.e., food stamps, housing, education, training systems, and 
work force systems. Many of these systems don't work well 
together because they have different origins, and they have 
different Federal rules. They arose from different Federal 
priorities, and they certainly have many different definitions.
    Our take on this is that these differences send some pretty 
conflicting messages to families. They create ominous hurdles 
for our staff who try to make them work together. They end up 
aggravating the public and me, even some of our dedicated 
workers get a little bit aggravated who are trying to help 
these families. The families themselves get kind of worked up 
about this. I get upset, too, because what we all want is a 
system that works better. I think it can and should work 
better. This isn't really a question where if we make 1 or 5 or 
10 changes in Congress each year, I think we can fix it. It 
really is broader than that. I think it's giving the States the 
flexibility, the authority to make real-time changes to align 
programs in ways that give better services to families and make 
program administration more manageable. For our taxpayers who 
are listening today and who follow our activities, give them 
more bang for their dollar.
    I believe the bottom line is this: The more challenging the 
family problems are, the more flexibility the States need to 
address the problems. The old adage one-size-fits-all is 
especially wrong for these most challenging of families that 
remain trapped in the system. For those who say, ``Well, this 
won't work, it isn't possible,'' I ask simply are they the same 
people that said the Aid to Families with Dependent Children 
(AFDC) entitlement couldn't be eliminated and that the TANF 
block grant would not work?
    I think that we've seen the partnership with Congress, 
Governors, legislators, and legislatures in those like those 
that are here today, have a closer relationship to the actual 
people with the kinds of problems that they have in those 
families where they need services. I would say the States, 
again, in this debate, will approach it this way: The States 
are willing to be held accountable, but the States really need 
and must have the responsibility and authority that goes with 
the accountability. To those who do not believe that greater 
flexibility for States is a deserving worthy goal, I ask this: 
What on Earth would it take to convince you, given the success 
of recent years?
    I think imposing flexibility for States is the equivalent 
of saying that better services to families, the more 
streamlined, efficient programs, somehow aren't worthy and 
deserving goals.
    In 2002, opposing State flexibility means more mandates and 
rules from Washington. Mr. Chairman, we tried that for 40 
years, and it didn't work. I'm proud of our record of reform in 
Michigan. I'm proud of what Republican and Democrat Governors 
have done across America. It's truly a remarkable transition 
that's taken place. Interestingly, it has happened in large 
States, in small States, with Democrat Governors, with 
Republican Governors, with legislatures of both parties. It's 
just been a change that truly was ready to happen. The Congress 
in 1996 paved the way, stuck with it and prevailed. The rest 
they say is history.
    I think the relationship that we built with Congress, the 
States and Nation's Governors back in 1995 and 1996 is one that 
has continued to improve. The debates back then resulted in 
historic reforms. Again, this year I think there's an 
opportunity. We ought to seize that opportunity to ensure that 
the historic reforms 1996 really are the foundation and that we 
continue them and move to the next level of success. That's why 
your hearing today is so important, that's why you honor us 
by--I know it's coming home, but by bringing this hearing here 
to your district and writing a record then that can go back to 
the other Members of your Committee. Mr. Chairman, for that we 
thank you. I'm happy to answer any questions that you might 
have.
    [The prepared statement of Mr. Engler follows:]
  Statement of the Hon. John Engler, Governor, State of Michigan, and 
                Chairman National Governors' Association
    Congressman Camp, I want to thank you, Chairman Herger, and other 
members of the committee for asking me to testify today. I also 
appreciate that this field hearing is happening in the State of 
Michigan, a state that has a proud record of welfare reform success.
    Not only is the state well represented by Congressman Camp, but we 
are privileged to have Congressman Sander Levin as a member of this 
subcommittee as well.
    I'd also like to acknowledge the hard work of Matt Weidinger and 
his staff at the subcommittee, as well as the staff of the minority 
subcommittee.
    I am grateful for the opportunity to take a few minutes to testify 
before this committee and ask that the additional information I am 
submitting on Michigan's welfare reform success be included in the 
record.
    In 1996, after two vetoes, federal welfare reform was signed into 
law on August 22. Many skeptics had their doubts, saying bad things 
would happen, effectively arguing that states weren't as concerned or 
compassionate about their residents as Washington. They were wrong!
    Welfare reform has worked and exceeded the expectations of many of 
its staunchest supporters. States took seriously the authority that was 
devolved and deserve trust through their actions and successes. The 
federal legislation succeeded because Washington focused on overarching 
goals, such as work and making assistance temporary, and left the 
strategies and methods to the states. The key word: flexibility. 
Michigan and other states have proven that given flexibility, states 
can design a better program, deliver better services, and get better 
outcomes for families and taxpayers. Michigan's reforms alone have 
resulted in over 308,000 Michigan families leaving welfare with earned 
income.
    As we move forward, it is important to maintain work in 
unsubsidized private sector employment as the key goal. Employment 
reduces welfare dependency, strengthens families, and exposes our next 
generation of children to the all-important work ethic. If we lose work 
as the central theme, we risk losing much of the gains we have made 
over the last decade.
    President Bush's proposal keeps work as a central focus, and I 
support his efforts to raise the bar. While some of the details are 
still emerging, we believe there is opportunity within the President's 
proposal, as well as others, to fine-tune the details so that current 
successful state programs can continue. I look forward to being part of 
a process of states, Congress, and the Administration in arriving at a 
final product that recognizes a goal of work, while balancing the 
changing mix of our caseloads, current state programs, available 
resources, and maximizing flexibility to the states. The President's 
proposal is a tremendous starting point, particularly given where we 
began back in 1995.
    Welfare reform is about strengthening families, and work 
strengthens families. However, work does not have to be nor should it 
be the only strategy to strengthen families. We have done many things 
in Michigan to support strong family structures, including fairer 
eligibility standards for two-parent families, targeted paternity 
establishment, reducing out-of-wedlock births, family reunification and 
preservation initiatives, and other family formation activities. 
However, as with the focus on work, it is critical that family 
formation strategies be left up to the states.
    I am also pleased that the President has proposed keeping the block 
grant level while also addressing other critical financial issues, such 
as a meaningful contingency fund, the ability of states to formally 
obligate unspent funds, and the ongoing commitment of a multi-year 
block grant.
    Nevertheless, given states' current fiscal situations, we will 
still be looking for any opportunities to include other economic 
increases or inflation factors to further supplement our base TANF 
funding.
    Another key opportunity is in allowing states to align and simplify 
other programs. The President's proposed ``super-waiver'' authority 
could be one of the most exciting, innovative, and effective things to 
come out of Washington in years.
    Families who receive cash are often caught in the trap of multiple 
and conflicting bureaucratic systems and programs--like food stamps, 
housing, education and training systems, and workforce systems. Many of 
these systems don't work well together because of different federal 
rules, priorities, and definitions. Different programs send conflicting 
messages to families; they create ominous hurdles for staff who try to 
make them work together; and they aggravate the public--and me--because 
we want a system that works better. I believe it can and should work 
better.
    This is not about making one or five or ten changes in Congress 
each year. It is about giving states flexibility and authority to make 
real-time changes to align programs in a way that gets better services 
to families, makes program administration more manageable, and provides 
more bang for the taxpayers' dollars. For those who say this will not 
work and is not possible, I ask them if they are the same people that 
said the AFDC entitlement could not be eliminated or said a TANF block 
grant would not work.
    Governors and legislatures are closer to the people needing the 
services. We are willing to be accountable, but we need the 
responsibility and authority that goes with the accountability. I 
challenge those who do not believe that greater flexibility for states 
is a deserving and worthy goal. That is the equivalent of saying that 
better services to families and more streamlined, efficient programs 
are not worthy and deserving goals.
    I am very proud of our record of reform in Michigan. I am also 
pleased with the relationship that Congress developed with Governors 
and states in 1995 and 1996 during the welfare reform debate. Those 
debates resulted in historic reforms, and we have the opportunity to 
ensure that those historic reforms continue and rise to the next level 
of success.
    With that, I would be happy to take questions.

                               

    Mr. CAMP. Well, thank you very much, Governor, and thank 
you for taking the time out of what is a very busy schedule to 
be here.
    As you know, we'll be working in Congress, with the 
Governors and especially with you in your role as Chairman of 
the National Governors' Association on extending the 1996 law 
for another 5 years. I hear what you're saying that flexibility 
is a real key to serving families better.
    The President has a proposal to expand the flexibility 
that's been granted to the States by really developing what 
former Wisconsin Governor and Health and Human Services 
Secretary Tommy Thompson calls a ``super-waiver'' proposal. How 
do you think that could best be used to helping low-income 
families better? What can we do to--or what can I do to help 
make sure that Michigan obtains the flexibility to serve low-
income families better?
    Mr. ENGLER. I think that there are a multitude of ways in 
which that can make a big difference. If we look at the number 
of programs that somebody might be eligible for, in a situation 
maybe where it's a single parent head of the family, with a 
couple of children, they may have needs that are in housing, or 
transportation, or certainly healthcare. We cover that largely 
through Medicaid, but there could be educational needs, an 
array of different programs, and maybe that mother also is 
pregnant with another child or has a very young baby. I used 
this example at the press conference earlier this morning, but 
just two obvious examples of programs that could easily fit 
together: the food stamps and the Special Supplemental 
Nutrition Program for Women, Infants, and Children (WIC). Both 
of those help with food and nutrition services. So, in our 
hypothetical family here, which isn't all that hypothetical 
when we look at our caseload, there would be an eligibility 
there for additional formula and other needs that a mother of a 
young child might have. It's interesting that the stores that 
are licensed to participate in these programs, since it's done 
by two different agencies, actually are--it can be different. 
In some cases one store is able to provide food stamps, but not 
the WIC program. It just doesn't make any sense. We've moved to 
an electronic benefit's card for the food stamp program, much 
simpler for the family to use. We should be able to put those 
programs together and help provide that additional help.
    I did promise a mother that I talked to a week ago when we 
were surrounded--and I might comment for our audience. You see 
all these achievers of the month, these posters here, these 
represent men and women who are some of the success stories. 
They're wonderful stories that you see. One of the moms, I 
don't think she's in one of these pictures, but she came up to 
me and she said, ``It's great to have the help when the kids 
are little. I've got some teenagers now, and trying to feed 
these teenagers is a whole different kind of challenge, and you 
ought to do something that--I could get by pretty good on my 
food stamp allotment when the kids were little, but these 
teenagers are eating me out of house and home.'' She happened 
to be somebody who moved off welfare. She continued, ``If I'd 
been on public assistance with food stamps, I'm not sure we 
would have had enough food to eat.'' So, she was saying for 
those who are still in that system, we ought to look at that.
    I said to her, that's a good point, you know, but with the 
flexibility that we seek, we could actually even address that 
kind of a question. It wasn't something I had thought about, 
but that's one example. There may be situations where somebody 
is entitled to assistance on housing, and yet their housing is 
secured. It's the transportation need that's impossible. Or 
it's even additional--you mentioned some statistics on child 
care, and that happens to be an area that probably has 
increased more dramatically in the Michigan State budget than 
almost anything saved Medicaid expenses, and yet the child care 
assistance is a great challenge where you're dealing with a 
family with a single parent. What happens, how do they--how do 
they work.
    Another example of a program, and it's in the U.S. 
Department of Education where they deal with the Head Start 
program, and there may be ways in which we can help that 
coordinate more effectively with a person going to work. We 
have actually had conflicts of times where the Head Start 
program said, ``No, you must come here and be in this classroom 
this day of this week.'' The mother is saying, ``Well, I have 
to also be at my job, how do I do both?'' You've got basically 
people in two different programs, each resolutely pursuing 
their goals of their program, and we need to be able to bring 
that--bring that together.
    Our workers get very creative in trying to figure all of 
this out, but it is a lot of effort and I'm just suggesting it 
could be made much more effective. So it is--that's why that 
waiver is attractive to Governors. I do have, knowing that 
there's an aspect of the Congress where the structure of 
subcommittees and committees, and that is quite traditional. 
Some of these are scattered through many various subcommittees, 
and therefore try to get all the subcommittees to deal with the 
``super-waiver'' proposal may be very difficult.
    Maybe there's an opportunity, if we can't achieve this on a 
national basis, for our Congressman from Michigan to write a 
provision that would allow for a couple of States to pilot 
this, and certainly I would volunteer to have Michigan be one 
of those that would pilot this. We would come in with great--we 
could be quite specific in terms of the things we would like. 
Maybe then there would be an opportunity to validate what the 
President's proposed in a couple of States, so that it could in 
a future Congress be adopted nationally. If we fall short, and 
I realize that we're in a desire to move the Welfare Reform 
legislation fairly quickly in the Congress, and that desire to 
move quickly may be in contrast to the physical requirements, 
getting through all these subcommittees. So, we're always 
looking, how do we work with you to try to accomplish the 
objective. So, it's a very good question, and probably the most 
important feature of how we can really make things work in the 
future.
    Mr. CAMP. I think it was, the real reason for the success 
was the flexibility that was given in the past.
    I'm glad you pointed out these pictures here, because I 
understand last week, after 10 years of welfare reform, that 
you recognized your 100th achiever of the month, and that is a 
tremendous goal. Obviously, I know there's many more who would 
also qualify for that.
    I wanted to ask a question that related to that, that is 
discussed in a lot of the meetings we have and hearings, and 
that is that we have dozens upon dozens of ways of receiving 
data and information and following people who have left 
welfare, and I might add that's a stark contrast, and that 
there was very little done to track people who had left AFDC in 
the past. I wondered about your thoughts on additional 
requirements on States to follow every person who has received 
assistance, and if you have any thoughts on what some of the 
welfare clients feel about that? What challenges might face you 
if some of these were mandated? What this might do to the 
resources? We all know the amount of resources are limited. How 
does this data reporting or tracking fit into how welfare is 
implemented in Michigan?
    Mr. ENGLER. Well, it--you know, we're not quite to the 
point of that being that big of brother to everyone where we do 
track sort of everyone every year and know exactly what's going 
on. On the other hand, many of these families we continue to 
work with, because there, even as you're making this 
transition, there may be retained eligibility of, say, for a 
Medicaid program, and so--for a year or more, in some cases 
where we're working with employers. There are ways in which we 
stay in touch.
    We also, because of the requirements of the 1996 
legislation on a 5-year lifetime eligibility for benefits, had 
to do more in terms of tracking families than we had 
historically done. So we do know, I suspect, or are able to put 
together more information. We in Michigan probably haven't 
gotten too worked up on some of the reporting. It seems like 
we're reporting everything and one of the more frustrating 
things is how sometimes the same information is required by 
different agencies to be reported in different ways.
    I note that in the recent successful package of the No 
Child Left Behind Education legislation, we're going to do 
something that I do think is very important. We're going to 
start following children from year to year in schools, so we 
know how much progress is being made. I--that happens to be 
something I do strongly believe is important, because I--and 
wanting to--our goal in terms of the--and I'm pleased to see 
that emphasis on education and strengthening families, because 
while we're helping in--these are achievers of the month, and 
these are people who have been able to change their lives. What 
you really also want to see is that the children in these 
families never go onto the system, but they're able to get the 
kind of education that allows them to compete to be employed, 
and to go through school, not become pregnant, a whole host of 
changes.
    So, I guess we'll--you tell us the information you need, 
and we'll try to provide that for you. It isn't--we'd rather--
we want to make sure that whatever questions you're asking, 
we've got some success stories to talk about, so I'd say, if 
you want more information, then you will give us more 
flexibility to run the program, we'll give you all the 
information you want, and you give us all the flexibility we 
need, and we'll have a bargain.
    Mr. CAMP. Okay. Then I just have one last question. A big 
part of the President's proposal is the work requirement, and I 
know that you've recently signed a law that moves Michigan to a 
40-hour work requirement already, and I wondered your thoughts 
on the President's proposal there.
    Mr. ENGLER. Well, we think that the way the proposal is 
structured with the requirement of 40 hours, but also allowing 
for some of that, up to 16 hours, to be met with additional 
training or skills development, that that could be--that that's 
something that we can achieve. We appreciate very much the 
phase-in period because it will--there are very, very few 
States that could comply today with where that bar would be 
set.
    I said in my testimony, we support raising the bar, we 
support the focus on work. We will need--as we lose the credit, 
which we've had, and someone in our audience may not understand 
how this has all worked, but there's been a--as families are 
successful and go to work, there's actually a credit that was 
applied, and so for many States we were able to exceed work 
requirements in part because we were having success. That made 
some sense to take the credit away, that's fine, but it--but 
then make sure that we have--because as we get further and 
further out there, the cases get harder and harder. There's--
you know, where maybe somebody had two major issues, now there 
may be five issues in a family.
    I've got some cases, I don't need to go into them, but, 
they're pretty remarkable when you just--when you think about 
it. Here's a--I mean, a two-parent--this happens to be a two-
parent household, father is employed, six children, 3 months to 
9 years. The mother is Arabic, language barriers, minimum 
education, multiple barriers, transportation issues, child 
care, some kids in school, others needing all-day day care, 
mother has limited skills, education, language barrier.
    We've got a husband and a wife, four children. Each parent 
spent 45 days in a drug rehab program, and then they took turns 
being with the kids. The father has a nighttime job in a town 
that's 40 miles east of where they live, actually may well be 
constituents, I won't name the counties, but, then the mother 
got a part-time job days at a--40 miles south, and that's 20 
hours per week. Neither one has a driver's license because they 
were suspended for alcohol abuse. They got to rely on volunteer 
drivers. In this case, the Michigan Works Agency is helping 
them to pay for transportation for 30 days. Then after that 
they're suppose to be on their own. Volunteer drivers are from 
a local dial-a-ride that charges 43 cents a mile.
    So, you've got, just a multitude of problems. Trying to get 
that family at 40 hours a week and stay there, is difficult. Up 
north we had families working at ski resorts, at restaurants or 
motels. When it didn't snow earlier in the winter, people got 
laid off.
    So, those are some of the challenges. So, when we--when I 
look at what you just asked me in terms of how this all plays 
out, I think we can get there. You're just going to have to--
it's going to have to be--it'll have to be phased in or we're 
going to have to look hard at what are these other activities, 
and some of the definitions there will matter very much.
    I would also argue that since you can meet the 40-hour test 
with as much as 16 hours of other education or training, maybe 
there's a way that on a--if somebody can move beyond taking the 
16 hours away from the 40. It's 24 hours at work, maybe if they 
can move that in terms of being on payrolls up higher, there's 
a credit that offsets. Maybe it's if you work an extra hour you 
get credit for 2 hours of that other activity. The average job, 
according to the U.S. Department of Labor statistics, is really 
40 hours, if we look at--now, a lot of the jobs are in the 32-, 
33-, 34-hour range, and so, it gets--and if somebody is 
working--actually let's say they're working 34 hours, maybe we 
ought to be saying that the rest of that time ought to be there 
for their family. Maybe there's a way to structure that. Make 
it 40 hours. At the same time, these are--these are--some of 
these families are pretty fragile as well. I don't want to have 
a set of policies which end up somehow being counter-productive 
to strengthening the family. The family formation is something 
else that is an initiative in this legislation.
    So that's--again, we're willing to work, and I think the 
way we can really master this among the States is for the 
Congress to set goals, and they can be very high goals, and 
then tell the States let's go out and compete, because I'm 
going to learn something each time somebody tries it.
    You mentioned Secretary Thompson, and I don't know if he'll 
read our testimony or not, but when he was Governor of 
Wisconsin we used to have quite a competition on both sides of 
Lake Michigan about who was doing what. I think it worked well 
for the people in Wisconsin, worked well for the people of 
Michigan, and it put us in a position where we had, by the time 
the 1995, 1996 debate rolled around, a lot of real experience 
that could be relied upon to sort of predict how some of these 
changes might lay out.
    Mr. CAMP. Thank you very much. Thank you for your 
testimony, and your time here today. I appreciate it very much.
    Mr. ENGLER. You're welcome.
    Mr. CAMP. Well, the Governor has agreed to join me up here 
while we hear from our second panel, and I would like to have 
Carol Koon, Darnell Carter, Lisa Hudson, Fred Keller, and Lori 
Scorsone, please.
    Why don't I start, Ms. Koon, with you, and each of you take 
about 5 minutes. We'll let everyone make their statements so 
that everyone has a chance, then I'll come back, and we'll have 
hopefully some time for some questions and dialog. So why don't 
you begin. Thank you.

            STATEMENT OF CAROL KOON, EVART, MICHIGAN

    Ms. KOON. Well, my name is Carol Koon, and I am a former 
Osceola County FIA person. I came to FIA in July 1999. My 
husband lost his job, and we were without any savings. I was 
working minimum wage in a local grocery store. We had four 
children, uncertain how long it was going to take before he 
received unemployment benefits, or how long it would be before 
he found another job. So, we went there and applied not sure 
what or how everything would work, if we'd even get any 
assistance or anything. We were met by some extremely friendly 
people who did not make us feel that we were bad in any way for 
coming there, the stigmatism to it.
    Anyways, we were referred to the Work First program to look 
for work through them. While I was there, I saw an ad for a 
secretary for one of the 911 centers in our area. It said, 
well, you wouldn't believe what we have available. We have a 
program right now, where we're training people to become 
certified dispatchers for one of the local 911 centers. What 
the problem was, is that Lake County was one of the last 
counties in Michigan to go to emergency 911. They needed to 
employ, I believe, up to 12 people at that time, and did not 
have the funding for all of the training that needed to be 
done. So, they set up with Work First to offer a program for 
people. If they passed the test, went through the training, 
they would be able to become certified and possibly gain 
employment with them. If not, they would still be totally 
trained to go to employment anywhere else in the State of 
Michigan or any State.
    So, that's what I did. I signed up for the program, I 
continued working, I dropped down to 20 hours a week, and took 
the 40 hours of training each week. Upon completing the test, I 
was fully certified by the end of September. In December, I was 
hired full-time with them. I am still currently employed there.
    We stopped receiving our benefits in September. It was not 
long after we had gone there that we stopped because we 
received his unemployment, which put us over the income levels. 
Without that training, I am not certain that if my husband was 
to have lost his job again we wouldn't be in the position to 
need assistance. Now that I have a career also, we are 
financially stable.
    The training was an extremely remarkable program. I can't 
say enough for the people that were so extremely dedicated, 
that were there to make sure that I succeeded, whatever was 
needed. I remember right before I started the job, my 
alternator went on my vehicle. I thought, I can't believe this. 
Sure enough, they said we'll get this taken care of.
    That's why I'm here today. I want to say thank you for the 
assistance that I received, for the compassionate people that 
were there to help. I think they need to have more of these 
programs available for people, not only to receive a job, but 
maybe to receive a career. So, that they're in a position to 
make some good choices.
    In my area, we're a rural area, there's not a lot of job 
opportunities. So, if maybe they could set something up for 
rural areas designed around what is available in the area, that 
would be a wonderful thing.
    That's why I'm here today.
    Mr. CAMP. Well, thank you very much.
    Ms. KOON. You're welcome.
    Mr. CAMP. Mr. Carter?

         STATEMENT OF DARNELL CARTER, DETROIT, MICHIGAN

    Mr. CARTER. Yes. First of all, good morning, ladies and 
gentlemen, and thank you for inviting me out.
    I would like to first say that I appreciate the opportunity 
to come before this Committee today to give my personal 
testimony of the impact of welfare reform, what it's had on my 
life, and to also be a voice for the people regarding the 
matter.
    Last Thursday I attended a ceremony, achiever of the month 
ceremony with Governor Engler and Director Howard, and we 
celebrated the 100th achiever of the month. It was a nice--it 
was very nice. A reporter came up to me and asked, said, ``Mr. 
Carter, do you believe that Governor Engler's reform is 
creating working poor?'' What I said was, no. I don't think 
it's creating working poor.
    I believe that welfare reform has been successful thus far. 
In Michigan, I know the caseloads are down tremendously 
compared to 1996 when the reform law was implemented. As a 
single parent with sole custody of two children, a 12-year-old 
daughter, that's Egypt, and an 8-year-old daughter, that's 
Christian, working is a winner for us, hands down. Even though 
we still face some of the challenges that plagued us before, 
such as child support, child care and medical coverage, working 
makes it a whole lot easier. I'll let you know that right now. 
I'm not going to worry about the situations that I face now 
because I have a strong belief in God. I know that he'll pull 
me through whatever I face, but I know that not everyone will 
see things the way that I see them.
    Now, I offer you a different perspective, and that is as a 
case manager for our Michigan Works Agency, dealing with the 
customers, helping them make the transition from welfare to 
work.
    I have been employed, almost 5 years. May 29 will be my 
fifth year, next month, with the Michigan Works Agency, and 
over the years I have met thousands of people and helped them 
make the same transition. It seems that everybody has a general 
question, where are the programs for low-income fathers? Where 
are the programs at? I'm not sure if there are even 50 of them 
here in Michigan statewide, and the few programs that I know 
are up and running, they serve as a liaison for some services 
to assist men, versus a training component, to assist low-
income fathers and rebuilding their lives and reconnecting them 
to their families. This has to change. Just like mothers, 
fathers are unique in their own way, with very different needs, 
such as more skilled jobs training, educational opportunities 
and many of them need help with legal matters.
    In conclusion, I believe that if we develop, implement and 
provide more funding for programs for low-income fathers, then 
we will further meet our goal of strengthening Michigan 
families, and be an example for the rest of the country. Upon 
doing this, I believe that welfare reform would truly reach its 
goal of strengthening families and reducing government 
dependency. Thank you very much.
    [The prepared statement of Mr. Carter follows:]
             Statement of Darnell Carter, Detroit, Michigan
    Good Morning Everyone,
    I appreciate the opportunity to stand before this committee today 
to give my personal testimony concerning welfare reform and its impact 
on my life, and also to be a voice for the people regarding the matter.
    A reporter at an achiever ceremony I attended with Gov. Engler 
asked me a question, ``Do you think that Gov. Engler's welfare reform 
initiative was creating the working poor?'' I replied by saying, 
``No''.
    I believe that welfare reform has been successful thus far. In 
Michigan welfare caseloads are down tremendously compared to 1996 when 
the welfare reform law was implemented. As a single parent with sole 
custody of two children, my 12-year-old daughter Egypt and 8-year-old 
daughter Christian, working is a winner hands down even though I still 
deal with some of the challenges that faced me while I was on 
assistance such as child support and daycare. I'm not going to worry 
because I have a strong belief in God and the ability to see my goals 
and make them come true despite what challenges are before me. But not 
everyone can see their lives that way. Now I will offer to you a 
different perspective as a case manager assisting recipients in making 
the transition from welfare to work. I've been employed for almost 5 
years and have met thousands of people at the very work first program 
that I attended. And my question along with countless others is, 
``Where are the programs to assist low-income fathers?'' I don't 
believe that there are even 25 statewide. And of the few programs I 
know that are operating they function more as a liaison for some 
services versus being a training component to assist low income fathers 
in rebuilding their lives and reconnecting them to their families. This 
has to change! And just like Mothers, Fathers are unique in their own 
way with very different needs such as more skilled jobs training, 
educational opportunities and to many help with legal matters.
    In conclusion, I believe that if we design, implement and provide 
more funding for programs to assist low income fathers that we will 
further meet our goal of strengthening Michigan families and be an 
example for the rest of the country. In addition I believe that once we 
do this we will begin to see even more progress with welfare reform and 
truly reach our goal of strengthening families and significantly 
reducing government dependency.
    Thank You.

                               

    Mr. CAMP. Thank you, Mr. Carter. Ms. Hudson?

        STATEMENT OF LISA HUDSON, GRAND RAPIDS, MICHIGAN

    Ms. HUDSON. My name is Lisa Hudson, I'm an employee at 
Cascade Engineering. I have been there for 2\1/2\ years now. 
Before I started at Cascade Engineering, I had all sorts of 
jobs, 3 months here, 7 months there. As you've heard before, 
there's always been certain situations, transportation, child 
care, something always happening to where I had to quit or 
something like that.
    Well, in August 1999 I applied for assistance with the FIA, 
and I had to report to the Work First program. This is where I 
came in through the welfare to work program. I met Ron 
Jimmerson from Cascade Engineering at the Work First office, 
and I got hired in at second shift. I wasn't sure how long I 
was going to stay. I was a first shifter and I needed first 
shift, but it ended working out fine. They offered me 
transportation, child care, and the FIA was on site.
    I was nervous, of course, because I had never worked in a 
factory. I figured I would save some money, get a car, go 
somewhere else or do something. Cascade Engineering's logo, if 
I can call it that, is a Company of Families. I felt right away 
that I was a part of this family. The people are not just human 
resource or supervisors--they are actually friends and family 
to me. Cascade Engineering offers pay for contribution. This 
consists of completing different levels, learning more skills 
and making more money, which I have accomplished.
    I started out at $8.50 per hour. I am now at level B, 
making $11.35 per hour. Effective April 5, I will be at level C 
making $13.35 per hour. I have met with Joyce Bosscher, my FIA 
worker out at Cascade Engineering. She's working on advancing 
my career at Cascade through Human Resource Department.
    The FIA caseworkers, Joyce Bosscher and Gary Loew, are on 
site. Before, I had caseworkers that were down at the office on 
Franklin, and I didn't feel like they really cared about me at 
all. I understand they have their job to do, they have a lot of 
cases, but it just wasn't personal. So, I really do like how 
the FIA is on site at Cascade Engineering. We can get personal, 
and we know each other by face. We call each other when we have 
a problem or things of such.
    During my employment at Cascade Engineering, I have faced 
many serious family issues, as I have before, but now I'm not 
alone. So, the issues kind of changed because before my kids 
were younger, and it was mainly child care. Now, I have 
teenagers, and it's a totally new ball game.
    I am a single parent, and Joyce has been there all steps of 
the way. She's offered--well, referred me to counselors. So, I 
have in-house counseling now for me and my children. It's 
getting a lot better.
    Oh, I want to also say, she has assisted me with car 
repairs, money management classes, Section 8, Habitat for 
Humanity. I could go on and on all day, but I won't.
    Also, I would like to say, my supervisors and other Cascade 
Engineering representatives have been a blessing in my life. 
Cascade Engineering is truly a Company of Families, and FIA has 
provided the resources and continued caring for my children and 
myself.
    I truly feel that through all these accomplishments--I have 
become a good role model for my children, which will help them 
in the future as they become adults.
    [The prepared statement of Ms. Hudson follows:]
            Statement of Lisa Hudson, Grand Rapids, Michigan
    Before starting at Cascade Engineering I had all sorts of jobs that 
I worked at for maybe 3 months here and there. I had to quit these jobs 
due to family problems such as transportation, child care, etc. In 8/99 
I applied for assistance with FIA and had to report to the work first 
program. This is where I came in through the Welfare to Work Program by 
meeting Ron Jimmerson from Cascade Engineering at the Work First 
Office. Cascade Engineering hired me at a 2nd shift job 
although I did need 1st. Second shift ended up working out 
for me and it was because of the many programs at Cascade Engineering 
and Family Independence Agency's support. One of the examples was the 
transportation provided to me to get to work.
    I wasn't sure how I felt at first. I was nervous and I have never 
really worked at a factory job. I figured I would save enough money to 
purchase a car and try other employment later. Cascade Engineering's 
logo is a Company of Families. I felt right away that I was a part of 
this family. The people are not just human resource of supervisors, 
they are my friends and family. Cascade Engineering offers "Pay for 
Contribution" which completing different levels, learning more skills 
and making more money which I have accomplished. I started out at $8.50 
per hour. I am now at Level B making $11.35 per hour. Effective 4/5/02 
I will be at Level C making $13.35 per hour and have met with Joyce 
Bosscher my FIA caseworker who has arranged a meeting with my Human 
Resource representative at Cascade Engineering to work on advancing my 
career at Cascade Engineering working in the Human Resource Department.
    The Family Independence Agency caseworkers, Joyce Bosscher and Gary 
Loew are onsite at Cascade Engineering. Before I had my caseworker 
onsite at Cascade Engineering I did not have a caseworker that I really 
thought cared about me and the issues I was dealing with. During my 
employment at Cascade Engineering I have faced many serious family 
issues that I previously had to deal with on my own while trying to 
maintain a job which I could not do. With the help of the Family 
Independence Agency on site I have made these accomplishments happen. I 
have four children. Childcare is not the problem because I do have 
daycare assistance. It is the two teenagers that I am having 
difficulties with being a single parent. I don't know where I would be 
or what I would be doing if it weren't for Joyce directing me in the 
right direction for counseling for my teenagers and myself which has 
helped me continue at my job. I have counseling set up once a week that 
was set up through FIA. I also have had assistance from Joyce with car 
repairs, money management classes, Section 8 and am presently 
participating in the Habitat for Humanity Homeownership Program so I 
may provide a better home and stability for my family. My supervisors 
and other Cascade Engineering representatives have been blessings in my 
life. Cascade Engineering is truly a Company of Families and FIA has 
provided the resources and the continued caring for my children and 
myself.
    I truly feel that through all these accomplishments I have become a 
good role model for my children which will help them in their future as 
they become adults.

                               

    Mr. CAMP. Well, thank you very much. Mr. Keller?

   STATEMENT OF FRED P. KELLER, CHAIRMAN AND CHIEF EXECUTIVE 
      OFFICER, CASCADE ENGINEERING, GRAND RAPIDS, MICHIGAN

    Mr. KELLER. Well, thank you for this opportunity, 
Representative Camp and Governor Engler.
    Just by way of background, Cascade Engineering is a 
manufacturer, about $200 million in sales, about 1,100 
employees, and we've got nine plants here in the States and one 
in Hungary. We've had a long-term interest in being business 
partners to improve the quality of life in our community. 
Beyond just the impact of doing business in the traditional way 
of giving back, rather it's been a matter of how we engage the 
community, how do we get involved in helping to solve some of 
the most important problems that are in the communities, and 
arrive at better solutions; applying, in a sense, the--kind of 
business skills that you learned in the manufacturing world to 
some of our most difficult problems in the community.
    I do believe that we have got sufficient resources in the 
existing agencies and the existing streams of revenue. If we 
can only learn how to leverage them better, we could in fact 
make a massive improvement specifically in our continuing cycle 
of poverty that does exist in America today.
    I believe the Nation has an opportunity to make significant 
new progress in reducing poverty. I believe that Cascade 
Engineering has demonstrated that moving people from poverty to 
not only a job, but to a career. That really is our intent, we 
call it welfare to career, not just welfare to a job, then it's 
possible. We have learned this is not rocket science.
    There is, in fact, application of known principles that can 
take us from where we are to massive improvement. We have, most 
of all, learned that all these results are not the work of any 
one sector. It's not the government sector, it's not the 
business sector, it's not the folks that are in poverty, it's 
all of us that have to work together in a systemic problem-
solving way for us to be able to significantly reduce the 
welfare roles and move people out of poverty.
    Fully, 22 percent of the people that we added to our rolls 
last year, in terms of entry level jobs, were people that were 
formerly receiving welfare benefits. This continues our rate of 
about 100 people or more that are in that category, that have 
formerly been on welfare, that are now working at Cascade 
Engineering. We moved our monthly retention rates from a pretty 
poor 60 percent or so, but now have been over 90, actually in 
the mid-nineties, for the last several months.
    As a result of this program and calculations by the FIA 
would show that we've saved the State of Michigan about 
$850,000 from our program alone. These savings, I can assure 
you, will continue year after year, because we are committed to 
this program.
    Our program did gain some attention from the Conference 
Board. We have been written up in their Corporate Community 
Development report, which we have copies of, if anybody would 
be interested in them? Further case study is being written up 
by Cornell University. So, we are looking at ways in which we 
can improve what we are doing through these case studies as 
well.
    Mainly we found that there are three main ingredients as to 
why it works for Cascade Engineering. The first one is the 
nature of the culture, an accepting culture, one that is open, 
one that values diversity, values people as individuals.
    Second, there's a lot of education. We had to educate 
ourselves, as much as educating those folks that are coming to 
us from welfare. Education around the area, and I will speak to 
that a little bit later, but specifically understanding what it 
means to be in poverty was very important for us to learn as 
employers.
    Most importantly, a system of support for the people moving 
out of poverty as they learn new skills and are faced with 
really a daunting task of living in two worlds. Retaining and 
even building the dignity of the individual making this move is 
really essential. Again, this is not rocket science. It's 
putting known principles into action. The government sector is 
critical to its success, and yet it cannot do it alone. It is 
essential that business engage the community and work with the 
local agencies. Primarily among them is the welfare industry 
known in this State as the FIA, and there are many critical 
elements. Having full-time social workers, as you heard from 
Lisa, in our plants, helping on a daily basis to keep our 
people working has been essential. By being integrated in our 
factories, they're making the calls to agencies to keep them on 
the job and working with them to find solutions to typical 
barriers, to continue in employment, such as child care, 
transportation, health care, emotional support.
    Placing the agency in the midst of our work force and 
making it clear that the objective is to have fully productive 
employees is really wonderfully simple, yet exquisitely 
effective. Little problems, when caught easily helped to avoid 
a disaster for the welfare to career employee later.
    I would also say encouraging local experimentation and 
publishing best practices, can only accelerate the rate of 
positive change. We have found that having these local FIA 
workers do employment readiness assessments for us has been 
very helpful. Those who are most likely to succeed are selected 
for employment now and the balance, have assignments to work on 
so that they will be ready to be employed in the near future.
    A critical part of what we learned is that we needed to 
teach both our current employees, especially our frontline 
leaders, and the people who have been on welfare, the hidden 
rules of the classes as outlined in Ruby Payne's book, A 
Framework for Understanding Poverty. This is our text that we 
used as understanding. This process helps both sides understand 
the behaviors and actions of the other.
    So, the result has been gratifying, as you can hear the 
stories. I can tell you, that--but there's much more to it than 
that, more than just the idea that some people are helped. It 
really is good business. The organization feels good about 
itself. It has the ability to know that it's a part of doing 
something good in the community. There's more energy. I don't 
know how to measure that necessarily, but you can feel it, it's 
palpable.
    So, the State of Michigan benefits by saving some money, 
the community benefits, the welfare recipients benefit, the 
business benefits. There's no losers here. It's an all-win 
game. There is a traditional thinking that says it's a zero-sum 
game. That if you're building a social capital, that you're 
taking away from profits, but in fact it's not the case. I 
think we're demonstrating that that's not the case.
    So, I guess if the question is how can the government 
sector help, by supporting this kind of experimentation? I 
think that you heard today about flexibility, and some earlier 
testimony of the Governor. I couldn't agree more. Flexibility 
is a key. We were able to have FIA workers on site because of 
that flexibility, because the State was able to allow us to do 
that.
    Encouraging those local experimentations and then 
publishing best practices has got to be able to help. I would 
say by further supporting programs that keep people out of 
poverty as much as those that are supporting them. So, we 
recognize that people that are coming out of poverty, it takes 
a while. There are situations where they fall back and they 
have difficulties. They need to be supportive in that very 
critical time when it's one more thing, as the Governor was 
pointing out, one more thing that comes up that could send them 
right back. We've got to be able to hold that line, and with 
that, the kind of flexibility that you're talking about. Thanks 
very much.
    [The prepared statement of Mr. Keller follows:]
  Statement of Fred P. Keller, Chairman and Chief Executive Officer, 
              Cascade Engineering, Grand Rapids, Michigan
    Cascade Engineering is a manufacturer of products for the 
automotive, office furniture and waste container markets. We have about 
1100 people employed including those in our nine U.S. plants and one in 
Hungary. Sales are about $200 million. I founded the company in 1973. 
We have been working with our community for a long time to solve some 
of its toughest problems. I believe that we have an opportunity as 
business partners to improve the quality of life in our community 
beyond the impact of doing business in the traditional way of ``giving 
back'' when we have some available money. In addition I believe we need 
to engage our communities to apply systems thinking to the problems to 
arrive at better solutions. I believe that we have plenty of resources 
in existing agencies, and revenue streams and if we could only learn 
how to leverage them better, we would be in a position to make massive 
improvements, specifically in our continuing cycle of poverty that 
exists in America today.

    Summary:

    I believe the nation has an opportunity to make significant new 
progress to reduce poverty!
    I believe Cascade Engineering has demonstrated that moving people 
from poverty to not only a job, but a meaningful career, is possible.
    We have learned that it is not rocket science, but the application 
of known principles that make a meaningful reduction in poverty 
possible.
    We have most of all learned that these results are not the work of 
the government sector alone, not the work of businesses alone, and not 
the work of social service agencies or people in poverty or any one 
segment alone. Rather we have demonstrated that by the concerted work 
of all working together in a systemic problem-solving manner, we can 
effect a significant reduction in not only the welfare roles, but of 
the number of people actually in poverty.

    What will it take?

    Fully 22 percent of the 168 people that we added to our entry-level 
payroll in our Grand Rapid's facilities in 2001 came from generational 
poverty. This raised our total to over 100 people now working in our 
factories who were formerly receiving welfare benefits. Our monthly 
retention rates have gone from 60 percent two years ago to over 90 
percent in recent months.
    As a result of this program, calculations by the FIA show that we 
have saved the State of Michigan $850,000 last year alone in reduced 
payments for assistance. These savings will continue year after year, 
because we are committed to this program.
    Our program gained the attention of The Conference Board and is the 
subject of a research report titled ``Corporate Community 
Development''. Reference report R-1310-02-RR
    (http://www.conference-board.org/products/researchreports/
dpubs.cfm?pubid=R-1310-02-RR)
    A further case study is being written by Cornell University's 
Johnson School of Business to document our efforts and to further study 
the underlying principles for its effectiveness.

    How does it work?

    We have found that there are three main ingredients in a successful 
program of moving people from welfare to a career:
    1. An accepting culture in the organization. Businesses must simply 
work very hard at building a culture of trust among all employees and 
learn to value each human being that is employed simply for who they 
are, as well as the work they do. We have been working for years on 
this issue and try very hard to make this a reality.
    2. Education of not only the incoming employees, but also of our 
existing employees, about what it means to be in poverty. They learn 
together why people who have been in generational poverty think and act 
differently than those who have been in the middle class.
    3. Most importantly a system of support for the people moving out 
of poverty as they learn new skills and are faced with the daunting 
task of living in two worlds. Retaining and even building the dignity 
of the individual making this move is essential.
    This is not rocket science. It is putting known principles into 
action. The government sector is critical to its success, and yet it 
cannot do it alone. It is essential that business engage the community 
and work with the local agencies--primary among them is the welfare 
agency known in this state as the Family Independence Agency.
    There are many critical elements, but having full-time social 
workers in our plants helping on a daily basis to KEEP our people 
working is essential. By being integrated in our factories they are 
making the calls to agencies to keep them on the job and working with 
them to find solutions to typical barriers to continued employment such 
as child care, transportation, health care and emotional support. 
Placing the agency in the midst of our workforce and making it clear 
that the objective is to have fully productive employees is wonderfully 
simple, yet exquisitely effective. Little problems, when caught early, 
help to avoid a disaster for the welfare-to-career employee.
    Encouraging local experimentation and publishing best practices can 
only accelerate the rate of positive change. We have found for instance 
that by having our FIA social workers do an employment readiness 
assessment, those who are most likely to succeed are selected for 
employment now and the balance have assignments to work on so that they 
will be ready to be employed in the near future. A critical part of 
what we learned is that we needed to teach both our current employees, 
especially our front-line leaders, and the people who have been on 
welfare, the ``hidden rules'' of the classes as outlined in Ruby 
Payne's book A Framework for Understanding Poverty (http://
ahaprocess.com/AboutRubyPayne.html). This educational process helps 
each group understand the actions and behaviors of the other.

    The result?

    Well, to hear the stories of people whose lives have been 
positively affected by this program should be enough, but I can tell 
you that there is much more to it as well. The organization actually is 
more energized; people are more focused because they know that the 
organization values everyone there. We actually get more done and make 
more progress because people like to work for an organization that they 
know cares not only about them, but the quality of life in the 
community.
    The State of Michigan benefits, the community benefits, the former 
welfare recipients benefit, our employees benefit, the company 
benefits! There are no losers in this equation. The traditional 
thinking that this must be a zero-sum game is plain wrong! When you 
build social capital in the workplace and the community you are not 
taking away from the profitability of the corporation. On the contrary 
you are building it up.

    How can the government sector help? By supporting this kind of 
experimentation:

         LCreate additional incentives for corporations to 
        participate in the problem solving process and to not only 
        employ people on welfare but learn about how to retain them.

         LEncourage local experimentation of solutions, and 
        publish the best practices.

    By further supporting programs that keep people out of poverty as 
much as programs that simply reduce the cost of maintaining people in 
poverty.

         LWe have found that once committed to employment in an 
        accepting environment, people generally want to sustain this 
        positive track.

         LInvesting in preventive programs similar to what we 
        have done will reduce future costs of maintaining the current 
        system.

                               

    Mr. CAMP. Thank you. Thank you very much. Ms. Scorsone?

STATEMENT OF LORI SCORSONE, FAMILY INDEPENDENCE MANAGER, FAMILY 
             INDEPENDENCE AGENCY, SAGINAW, MICHIGAN

    Ms. SCORSONE. Yes. Good afternoon, Governor Engler, 
Chairman Camp. Thank you for the opportunity to provide 
comments regarding our welfare reform success in Saginaw 
County.
    I'm Lori Scorsone, a Family Independence Manager with 
Saginaw County FIA. I am honored to be present today to offer 
testimony on behalf of our agency, and to recommend the re-
authorization of the Federal Welfare Reform Law.
    In 1990, I was hired as an Assistant Payment Worker for 
what was then known as the Department of Social Services. At 
that time, an Assistance Payment Worker's primary goal was to 
determine if an applicant was eligible based solely on their 
eligibility. We were processing applications focusing more on 
gathering income verifications, processing paperwork and 
meeting deadlines rather than focusing on the applicant's 
family's needs. We had little opportunity and fewer resources 
to focus on the individual, the reason there was a need for 
assistance, or barriers that prevented an individual from 
becoming employed. Further, there was not an understanding that 
assistance was expected to be only temporary, or that the 
applicant or the Department had a mutual responsibility to see 
that it was actually temporary.
    Since the Welfare Reform Law has been enacted in 1996, we 
changed our name to the FIA. The title, Assistance Payment 
Worker, was changed to Family Independence Specialist. The new 
titles imply the new goals and objectives of the agency and the 
staff due to the Welfare Reform Law.
    Since 1996, the Agency has been able to focus on the 
individual's need for assistance and what can be done to 
abolish obstacles to their becoming self-sufficient.
    Our staff serve our customers today as individuals and as 
families. Today, we are able to work together with the customer 
to not only identify barriers that prevent them from becoming 
employed, but to help them remove these barriers, move them 
into the workplace, and help them maintain the employment.
    Today, the FIA works together with customers and other 
community partners to resolve issues such as: lack of day care, 
transportation, education, substance abuse and domestic 
violence.
    We're all familiar with reports and surveys and statistics 
that have been published giving us an idea of how the welfare 
roles have declined since 1996. Reports have illustrated that 
there are fewer families on assistance and more single mothers 
are working. Through my duties as a Family Independence 
Manager, I have been able to witness firsthand the achievements 
of welfare reform. I have seen and heard former assistance 
recipients talk about the joy at being able to be role models 
for their children as they move from welfare to employment. 
This extremely gratifying experience has proved to me that the 
new way of doing business has been successful in ways that the 
statistics and the reports cannot communicate. To continue 
delivering services as we have since welfare reform was 
adopted, will allow our agency to make even more positive 
changes and longer lasting changes. It will allow us to develop 
other ways to provide the help and support needed by the people 
we serve. It will allow us to educate and instill a work ethic 
for our customers, thereby reducing the welfare roles even 
more.
    Welfare reform helped launch Project Zero, a program that 
focuses on customers who have no earned income. The FIA 
specialists are now doing assessments of every new customer 
coming to our agency for help. Assessments allow the specialist 
to ascertain what barriers a customer may have that prevents 
them from becoming employed. We look at their family 
circumstances, their educational background, availability of 
transportation and child day care. We try to determine any 
evidence of drug or alcohol discrepancy or if there are signs 
of domestic violence.
    Prior to welfare reform, assessments were not done. Workers 
were processing paperwork, getting the cases opened and 
forgetting about them. It was a system that seemed to help 
continue a person's and their family's dependence on welfare. 
Prior to welfare reform, we were not dealing with the cause of 
the problem.
    Today, we determine the cause and work together with the 
customer to resolve the problem. Our customers know this and 
are willing partners in this process. Two primary barriers for 
customers in Saginaw County were transportation and child day 
care. Saginaw County now employs the services of the Michigan 
Department of Transportation to supply transportation for 
customers in need. Customers who need transportation receive 
help to get to and from work. Their children receive help 
getting to and from their day care provider. Saginaw Valley 
Regional 4C, a day care referral service, is currently housed 
within our agency, making it more easily and readily accessible 
to the customers.
    These services are something we were not able to provide 
prior to welfare reform. Because of welfare reform, many of our 
customers are realizing for the first time that they're capable 
of doing more than they ever dreamed they were capable of 
doing. Additionally, the specialists are able to give the 
customers some guidance and direction, something we have not 
given them in the past. The statistics and the graphs can never 
demonstrate to the general public the difference in a person's 
attitude when they bring home their first paycheck, how it 
completely changes their attitudes and opinions of themselves, 
and how it empowers them and gives them the encouragement and 
the desire to continue to do well, to be self-sufficient and no 
longer depend on the agency for their livelihood.
    Welfare reform, in no small way, is responsible for the 
successes I've witnessed in the last several years. We've made 
tremendous strides in determining some of the barriers our 
customers have that have prevented them from becoming self-
sufficient. There's still much more that must be done to help 
families realize their full potential.
    For years we have fostered our customers' dependency. To 
reverse this will not happen overnight. Welfare reform must 
continue so we are allowed to work with our customers, partner 
with outside resources, learn the true cause of need, and 
determine together how to resolve it. Re-authorization of the 
Federal Welfare Reform Act, along with proper staffing, will 
allow us that opportunity. I respectfully request that you 
strongly consider doing so. Thank you.
    [The prepared statement of Ms. Scorsone follows:]
    Statement of Lori Scorsone, Family Independence Manager, Family 
                 Independence Agency, Saginaw, Michigan
    Good morning Chairman Camp, and honorable members of the 
Subcommittee. I am honored to be present today to offer testimony on 
behalf of the Saginaw County Family Independence Agency and to 
recommend the reauthorization of the federal welfare reform act known 
as Temporary Assistance for Needy Families.
    In 1990, I was hired as an Assistance Payment Worker for what was 
then known as the Department of Social Services. At that time an 
Assistance Payment Worker's primary goal was to determine if an 
applicant would be approved or denied for assistance based solely on 
eligibility. We were processing applications focusing more on gathering 
verifications, processing paperwork, and meeting deadlines, than 
focusing on the applicant and their need. We had little opportunity and 
fewer resources to focus on the individual, the reason there was a need 
for assistance, or barriers that prevented an individual from becoming 
employed.
    Further, there was not an understanding that assistance was 
expected to be temporary, or that the applicant or the department had a 
mutual responsibility to see that it was actually temporary. In 1996, 
we changed our name to the Family Independence Agency. The title 
Assistance Payment Worker was changed to Family Independence 
Specialist. The new titles implied the new goals and objectives of the 
agency and staff due to Welfare Reform. Since 1996, the agency has been 
able to focus on the individual's need for assistance and what can be 
done to abolish obstacles in their way of becoming self-sufficient. 
Implementation of TANF has allowed staff to serve our customers as 
individuals and families. Today we are able to work together with the 
customer to not only identify barriers that prevent them from becoming 
employed, but to help remove these barriers, and help them maintain 
employment. TANF has allowed the Family Independence Agency to work 
together with the customer and other resources within the community to 
resolve issues such as lack of day care, transportation, education, 
substance abuse, and domestic violence.
    We are all familiar with reports, surveys, and statistics that have 
been published giving us an idea of how welfare rolls have declined 
since 1996. Reports have illustrated that there are fewer families on 
assistance and more single mothers are working. Through my duties as a 
Family Independence Specialist and Manager, I have been able to witness 
first hand the achievements of Welfare Reform. I have seen and heard 
former recipients talk about their joy at being able to be role models 
for their children as they have moved from assistance to employment.
    This extremely gratifying experience has provided personal evidence 
that the new way of doing business has been successful in ways that 
statistics and reports cannot communicate. I can only hope that the 
specialists are allowed to continue to provide the services they've 
been able to provide since 1996. Doing so will allow the agency to make 
even more positive changes, and longer lasting changes. It will allow 
us to develop other ways to provide the help and support that is needed 
by the people we serve. It will allow us to educate and instill a work 
ethic for our customers thereby reducing the welfare roll even more. 
Welfare Reform helped launch Project Zero, a program that focuses on 
customers who have no earned income. Specialists now do an assessment 
of a customer in need of the agency's help. Assessments allow the 
specialist to ascertain what barriers a customer may have that prevents 
them from becoming employed. We look at their family circumstances, 
educational background, availability of transportation, and child day 
care. We try to determine any evidence of drug or alcohol dependency, 
and if there are any signs of domestic violence. Prior to Welfare 
Reform, assessments were not done. Workers were just processing 
paperwork; it was a system that seemed to help continue a person's and 
their family's dependency on welfare. Prior to Welfare Reform we were 
not dealing with the cause of the problem. Today, we determine the 
cause and together work with the customer to resolve the problem. Two 
primary barriers for customers in Saginaw County are transportation and 
Child Day Care. Welfare Reform has given Saginaw County the opportunity 
to employ the services of the Michigan Department of Transportation to 
supply transportation for customers in need. Customers are taken to and 
from work. Their children are taken to and from their day care 
provider. Saginaw Valley Regional 4C, a day care referral agency, is 
currently housed within our agency making it more easily and readily 
accessible to our customers. These services are something we were not 
able to provide prior to Welfare Reform. Because of Welfare Reform, 
many of our customers are realizing for the first time that they are 
capable of doing more than they ever dreamed they were capable of 
doing. Because of Welfare Reform, the specialists are able to give the 
customers some guidance and direction. Something we have not given them 
in the past. The statistics and the graphs can never demonstrate to the 
general population the difference in a person's attitude when they 
bring home their first paycheck, how it completely changes their 
attitudes and opinions of themselves, how it empowers them and gives 
them the encouragement and desire to continue to do well. To be self-
sufficient and no longer depend on the agency for their livelihood.
    Welfare Reform, in no small way is responsible for the successes I 
have witnessed in the last several years. We have made tremendous 
strides in determining some of the barriers our customers have that 
have prevented them from becoming self-sufficient, but there is still 
much more that must be done to help families free themselves of the 
barriers and realize their potential. For years we have fostered our 
customer's dependency. To reverse this will not happen overnight. 
Reformation of welfare must continue so we are allowed to utilize our 
customers, partner with outside resources, learn the true cause of 
need, and determine how to resolve it. Reauthorization of the Federal 
Welfare Reform Act along with proper staffing will allow us that 
opportunity. I respectfully request that you strongly consider doing 
so.
    Thank you.

                               

    Mr. CAMP. Thank you very much. Governor, do you have any 
questions? I have a couple.
    Mr. ENGLER. Why don't you go ahead. I've got a couple, but 
I'll----
    Mr. CAMP. I just wanted to ask the three of you what was 
the biggest help or benefit that you received, I mean obviously 
it may be different, from the FIA? What thing occurred that 
helped the most?
    Ms. KOON. Well, I would have to say, for me, it would have 
been the training. That was definitely the key for me, was to 
give me the opportunity to further myself.
    Mr. CAMP. All right. Mr. Carter?
    Mr. CARTER. Well, I would say the overall assistance of my 
caseworker at that time. I mean, she deferred me from Work 
First temporarily so that I could finish up my schooling, which 
I received an Associate of Arts degree back in 1997. Upon 
completing that I went to her, and she referred me to Work 
First to assist me in becoming employed--giving me some 
different outlets. So, I would just say the overall assistance 
that I received, period.
    Mr. CAMP. Having a plan?
    Mr. CARTER. Excuse me?
    Mr. CAMP. Having a plan?
    Mr. CARTER. Yes.
    Mr. CAMP. Okay. Ms. Hudson?
    Ms. HUDSON. I guess mine would be that they're on site at 
my job, in that they're there constantly for whenever or 
whatever.
    Mr. CAMP. Then I wanted to ask for each of you, what was 
the biggest challenge that you saw as you were attempting to 
become employed and get a job, what were your biggest 
challenges? I want to go back in reverse order. Ms. Hudson, do 
you--or maybe there wasn't just one.
    Ms. HUDSON. Could you explain what you mean?
    Mr. CAMP. The biggest challenge that you might have faced 
as you were dealing with the Agency in trying to get to work 
and get started--what did you see as the biggest hurdle or 
barrier that you had?
    Ms. HUDSON. The biggest barrier for me was transportation, 
meaning I had to get to work. At that time I didn't have a car, 
so I was on the bus. Before I got to work, I had to get on the 
bus to take them to the day care provider, which sometimes 
wasn't on the same route. So, I had to be up 3 to 4 hours 
before it was time to be to work, to get the kids ready and 
then get off on the bus. That was the hardest part.
    Mr. CAMP. Did you get help with that transportation problem 
through FIA?
    Ms. HUDSON. Yes.
    Mr. CAMP. Okay. Mr. Carter, what was your biggest barrier 
or hurdle or challenge, I might say?
    Mr. CARTER. Let's see, I know of a barrier, child care. I 
was able to get assistance through the FIA and--the referrals, 
because I didn't know personally of any sources. As I mentioned 
about the fatherhood programs, I had been searching for some 
that could assist me, but I wasn't able to find anyone. So, I 
just believe my biggest challenge was child care, among some 
other things. It worked out, setting the plan up, so things 
worked fine.
    Mr. CAMP. Okay.
    Ms. KOON. Thankfully enough, I really didn't have a hurdle 
to overcome. At the time my husband wasn't working while I went 
through the training, so we didn't have the child care issues. 
I think that maybe I would have had hurdles if I hadn't had 
such support, the encouragement. I'm not just saying that if 
they hadn't been there to be so much of a support system, I 
could have failed.
    Mr. CAMP. Well, I want to really thank all of you for 
coming here and traveling on this fine spring day, this type of 
weather. It's not easy to come and talk about yourself, 
especially in a format like this. This isn't the easiest format 
to get a conversation going, but this is very good. It is going 
to be very helpful to the Committee, and I appreciate this very 
much. There may be some other questions later, but I had a 
question for Mr. Keller.
    I wondered, how is it that a FIA person is located on site 
at your business, how did that come about?
    Mr. KELLER. I couldn't tell you the exact day that that 
decision was made, but I can tell you it was made in 
cooperation with the folks that are part of Cascade and the 
FIA. Actually, Ron Jimmerson, who heads our community group 
within Cascade and is our H.R. Director for Community 
Activities, would be able to tell you that better. He's sitting 
in the audience. The point is that it is a collaboration that 
resulted in this as an answer. It was a very important 
decision.
    Mr. CAMP. Have other employers in the area kind of followed 
your example? Have you seen that or are any of them asking you 
about maybe becoming involved to the same extent Cascade is?
    Mr. KELLER. Yeah, we have. I can't say there's a line at 
the door, but there are certainly others that are looking at 
it. We have one in particular, Butterball Farms, who has been 
working very closely with us and is now working with a 
collaboration of 10 other employers in their area to see if we 
can have another format of this. Which is maybe why we don't 
have the FIA worker directly on site because these are smaller 
organizations, and maybe they can be visiting several or can 
have regular business hours, if you will, at several different 
places. So, we're experimenting with some new formats.
    Mr. CAMP. Then lastly, I wanted to ask you, do you have in 
mind any incentives that might be available to employers to 
help them become involved in transitioning people from welfare 
to work?
    Mr. KELLER. Government is real good at figuring out those, 
but the concept of--the best thing I could think of would be a 
tax incentive that would basically take a look, and in very 
clear terms, at how many people you got employed today that are 
involved in formally being on the FIA rolls, and that you're 
keeping them. There's a whole lot of work that has to be done 
to get there.
    The educational piece, the cultural piece, is really--they 
have to want to do that. Providing some incentive, I think, 
could be stimulating for this.
    Mr. CAMP. Okay. Thank you. Ms. Scorsone, thank you for your 
testimony, too. As we consider this 5-year extension of 
welfare, what's the single most important message I can take 
back in terms of how the current law has benefited working--
low-income families in Michigan?
    Ms. SCORSONE. I think the most important message that you 
can take back is that it is working. We need to be able to 
continue doing what we've been doing. As I mentioned in my 
testimony, it took years to get where we are, and it's not 
going to happen overnight. Allowing the State to use the money 
as they see fit in different areas of the State, everybody's 
different, if we're allowed to do that, I think that we'll see 
more success. I think we're better able to serve the people who 
are in need, by having that flexibility.
    So, if we're able to continue it, that along with the 
proper amount of staff to do these things that need to be done, 
I think we can get there.
    Mr. CAMP. Thank you very much. Governor Engler?
    Mr. ENGLER. Just a couple of questions, perhaps, and I 
think the Chairman has asked some excellent questions. I'm 
curious from Ms. Koon, Mr. Carter, and Ms. Hudson. Of people 
that you may know who are still on public assistance, what 
advice would you give us to help some of your friends that you 
know who are sort of still stuck? What is there differently 
that might be done to help somebody you know who hasn't made 
the break the way you have been able to do it?
    I don't care, if you want, we can start down with Ms. Koon.
    Ms. KOON. Sure. I believe that--I know in my situation, 
that there are a lot of these different programs to help 
strengthen your work skills, help you with resumes.
    I think there needs to be more advertising for that. Until 
we were in the position that we needed assistance, we didn't 
know that that was out there. I believe that there are still 
plenty of people even now that are on assistance who don't 
realize what all is really available.
    Mr. ENGLER. Was this through a Work First agency?
    Ms. KOON. That was through a Work First, yes. So, that's 
something that they need to do, is get the word out more.
    Mr. ENGLER. Interesting. Okay.
    Mr. CARTER. Just to piggyback off of what Ms. Koon said, I 
believe the current programs are functioning well. We could 
tweak them some to include more training as far as basic social 
skills and communication. People need to know how to 
communicate with their employers as well as the parent, the 
mother to the father, the father to the mother. We're dealing 
with men, more programs to help develop them totally so that we 
can glue the pieces back and reconnect the family.
    Mr. ENGLER. Sure.
    Ms. HUDSON. I think one of the main reasons some people 
haven't transitioned over is because of fear of being 
dependent--being independent. You know, you got the Medicaid, 
you got the food stamps, they pay the rent, and the thought of 
doing that on your own is scary to some people out there having 
it.
    Mr. ENGLER. Okay. We've--in some communities, we have 
actually worked with outside organizations, faith based 
organizations in some cases or community based organizations. I 
know in west Michigan, in Ottawa County, there was a coalition 
of religious organizations and some of the areas of Detroit it 
was the Salvation Army. We tried to get, in effect, somebody to 
try to deal with just that question because it was pretty clear 
that that was something where you're talking about generational 
poverty. This is a very big step. I mean, we had--we literally 
had some families where there wasn't anybody in the family that 
hadn't been on public assistance pretty much most of their 
lives. Trying to break the cycle, we're trying to help the 
adult who we're dealing with right now, plus change things for 
the kids, and it's a big change.
    Ms. Scorsone, you sort of--you see this from the Agency 
standpoint. I think the evidence would be that we've got--as we 
move further out, we get many more difficulties that we arrive 
with each case. I mean, it's easier if somebody's brand new to 
poverty or brand new to that situation, trying to get them back 
into the work force. Ms. Koon's situation might be a good 
example of that. Where it's generational, at least talking to 
workers, that's just really much more complex to deal with, and 
I'm curious if--sort of the same question in terms of some of 
the people that haven't made the break, what do you see?
    Ms. SCORSONE. I would have to agree with Mr. Carter. I 
would like to see more training programs for them, develop 
social skills, work skills. It can be something as basic as 
them needing to understand that they need to call into work 
when they're not going to show up because they're sick. They 
don't know to do that, a lot of them, or how to react on the 
job in a hostile confrontation with a coworker or with an 
employee or employer. I have seen this over and over again, you 
just need to shove in the right direction, and if you don't 
know, you don't know. Once you're able to tell them about it, 
then they understand. They're able to use it and stay in a job, 
look for better jobs.
    Mr. ENGLER. That is actually in the proposal that Congress 
has from the Administration, the 16 hours are exactly what's 
allowed for those kinds of activities, and so that's one of the 
things we're saying. They will vary slightly from even regions 
within a State, and so they--we think some of this actually 
could be done by the employer, but the difficulty is if the 
employer's doing it, then that's time off of task. So there is 
a cost to that, but collaborative approaches that we--all of 
you had connections.
    We think the Work First system seems to have some 
strengths, and that's another area where we're actually saying 
make that a lot more flexible because so much of the job 
training stuff is very narrowly targeted. When, in fact, what 
you're all describing is the need to sort of cut across because 
any job would require what about three of you have just 
mentioned as needed and certainly as Mr. Keller has testified 
to.
    Mr. CAMP. Part of what we're trying to do is have the 16 
hours be a State definition of the 40 hours. Whereas now under 
the 30 hours, the 10 hours is a Federal definition of education 
training. If it's a State definition, it would seem to me there 
would be more flexibility to offer what I also refer to as sort 
of social skills, communication part of it, that would help not 
only in the workplace, but also at home is what I'm hearing. 
Hopefully, that would be where that would fit in.
    Mr. KELLER. I would just chime in a little bit that perhaps 
the employers should not be left out of that equation 
unnecessarily. It really--we found that by having education 
available on the job or in--on the work site, it does save this 
transportation problem issue. It does save a lot of other 
issues that the recipients can have trouble with. So, we found 
that doing education right there and making it a part of our 
standard curriculum--for instance, we teach Seven Habits of 
Highly Effective People to all our employees, not whether 
they're--wherever they come from, and that gives us a language 
to talk about in terms of how you treat people, conflict 
resolution, beginning with the end in sight. All of those 
things are very important for life skills. We found those to be 
very helpful.
    Mr. CAMP. Yeah, that's a very good book. I've given it to 
everyone in my office as well. It's a good start.
    Mr. KELLER. It works.
    Mr. ENGLER. I'm curious, in your testimony also there was a 
mention about the--sort of the education of your frontline 
leaders on the hidden rules for the classes, and you mentioned 
that a Ruby Payne book. I'm curious, what are the most 
important things that you got to teach the--those frontline 
supervisors and coworkers about work environment?
    Mr. KELLER. Well, you know, we have tried doing this for 
years, and kind of our first approach was--the thinking is just 
give somebody a job and that's what you need to do. You kind of 
tell them what the rules are, and if they don't live up to the 
rules, they're out of there. That's kind of classic business 
style.
    We learned that doesn't work, and that tends to be what our 
frontline leaders are used to. Let's read them the rules and if 
they don't live by them, well, we got three ways to write you 
up and so on, so forth. Eventually you're out.
    So, the biggest thing was teaching the fact that people who 
have been on generation welfare really value a friend, really 
value having a relationship in the organization. We had to 
genuinely do that. It's not something you just kind feel like, 
but it's you know that somebody is your friend. That--working 
that as a supervisor is different from traditional business, in 
a sense.
    Mr. ENGLER. What do you--any of you have to say about the--
there's one system that we spend about $14.5 billion on 
annually Federal, State, and local monies, it's the K-12 
education system, and I'm curious. What changes would you make 
there--I don't know how broad this question is, I apologize for 
that, but I'm specifically kind of interested in education 
systems where we've got a lot of activity going on there and a 
lot of money being spent, but to sort of try to deal with maybe 
children who have had backgrounds in poverty or how do we--
there we do have the kids for a long period of time for a lot 
of years, what is there something that ought to be done there? 
Maybe that gets at what Mr. Keller just talked about, at the 
work site there's--some of that is probably equally applicable 
for how do we break through and get an education, because we've 
got a lot of young people who transition through the schools. 
Even if they finish, they don't have any skills that you find 
applicable or necessary to run a computer--that's probably 
managing some line.
    So, I don't know everybody's--how far anybody has 
progressed in school or how--if at some point, Ms. Hudson, you 
were pregnant and left school or how that worked, but what is 
there that you might say to school leaders from your various 
perspectives?
    Ms. SCORSONE. A common denominator with the customers that 
I have served is that they really are unaware of their 
capabilities, for whatever reason. I think in school, if the 
teachers were able to let them know, they can do what they want 
to do. I have to assume it didn't come from parents of the 
people I'm helping. So, if it can come from a different 
direction, then that would be great. They really don't think 
that they're capable of having better, and they all are.
    Mr. KELLER. I'd love to respond to that. I would love the 
opportunity. It's a very important step that we now are looking 
at, as we're talking today, about pulling people out of 
welfare. Really, the next logical step that we have looked at 
is how do we keep people from going into that trough in the 
first place. We have a little experimental program, we like 
experimenting in our place, and we're doing it. It's called 
school to career progressions, and we're trying to work. 
Actually, we've developed a curriculum much like we have in our 
own organization, we're teaching the Seven Habits, Conflict 
Resolution, we're teaching what it's like to be at work, we're 
also exposing these kids, students, to all different kinds of 
careers, not just manufacturing, but the health care field, and 
so forth. We're finding that pretty good, interesting response.
    The first year we took 23 at-risk kids that everybody 
thought was going to basically not go on; 18 of them are now 
either working or in school. We're in our second year, we're 
expanding it, we're having some fun trying some new things, but 
I think that--I like to call it a pull system of education 
where students understand where they are going, what they want 
to accomplish, and they pull themselves through the educational 
process as opposed to us pushing them through with a standard 
curriculum that we think they ought to be interested in.
    Mr. ENGLER. Do you have a comment on that, Ms. Hudson?
    Ms. HUDSON. Yeah. I'm not sure exactly what you're asking, 
but, I got pregnant at the age of 14. I never dropped out of 
school. I had four children--I'm stair-stepping. I never 
dropped out of school, but I still feel--I'm not sure exactly 
what it is you can do in the school. I will always feel it 
starts at home. I feel like now that I am more productive, and 
my kids see that I'm more productive. They feel that's the way 
it's supposed to be. You're not supposed to be on assistance. 
It's not a way of life, it's a stepping stone.
    I'm in college now, so my teenagers feel they are supposed 
to go to college now. You know what I mean? I feel like it's 
actually at home. I am not really sure what you could do as far 
as at school, though.
    Mr. ENGLER. What would you do to try to help--is there 
anything we could do--Michigan is actually--again this is 
something that Chairman Camp is very much involved with. I'll 
break for him, because he need not say it, but there was a 
bonus actually put into the Federal legislation in 1996 for 
States that would work to try to reduce the number of teen 
pregnancies. Clearly, had you not been pregnant at 14, and 
again maybe at 16, things would be different. Try to 
communicate that to the young women and the young men.
    Mr. Carter's situation, I happen to know a little bit about 
it from just last week. He's rather remarkable because he 
didn't know he was a father until later, and then he found out 
and stepped forward. His child had been placed in foster care, 
and he didn't know he had a child. He worked hard then to have 
his child come and be a father to his child. Now he's a 
remarkable success, but clearly--and we've had some success in 
Michigan, but it's not where we would like to be. Trying to get 
a message across and to have a set of policies, it would be one 
thing that we've looked at, and either--is the number of 
pregnancies of teens, very young teens, and the case at 14, 
actually it's against the law, for whatever that means, but I 
mean for the young man, it's criminal sexual conduct, that's 
what it's called under the law. At 14, the age is too young, we 
have said, well, probably aren't going to put this person in 
the law, somebody should go to prison, but are there ways to 
send signals or messages or how do you help? How do you change 
that?
    Ms. HUDSON. I am not really sure. I'm happy that my kids' 
father wasn't put in prison. He went off to the University of 
Connecticut, he played basketball, and now he's a teacher for 
the Grand Rapids Public Schools and they need that. I really 
talked to my daughter, my oldest daughter about everything I 
went through. I have taken her to the doctor, and I put her on 
birth control even though she's not--because you can't take any 
chances these days.
    As far as the males, I'm not sure if I'm on the same 
subject, but I think we need to grab them, get a hold of them 
and--at a younger age than we are, because like now we have a 
system where it's mainly you don't do anything. Okay, like I 
have a teenage son, and he's not doing anything really bad, as 
far as the law, but he's starting to get, worse. Sooner or 
later it will eventually be something, and there's no program, 
for kids before it gets bad. You know what I mean? I don't 
know, I wanted to say that, but, I think if we have programs 
where you can grab these kids before something has happened, 
you wouldn't have so many kids that you have to worry about, 
now and----
    Mr. ENGLER. Yeah. Okay.
    Mr. CARTER. I would say more in-school job skills and life 
skills training programs for our children and after-school 
preventative programs, also. I would target grades 6 through 
12, because as we know, the hours of after school until about 8 
p.m. is when, they're probably at risk the most. For those 
after-school programs to include a component that the parents 
can come in with the children and get some kind of educational 
training or whatever is going on in the programs.
    Mr. ENGLER. Interestingly enough, one of the things we've 
talked about in trying to comply with the Federal law is these 
kinds of--this may well be that 16 hours, some of that could 
fit right there, and you could actually--again, given the 
flexibility, that's why I wrote the record on that topic. It is 
possible to almost have parents sort of being trained to be 
volunteer supervisors, and taking these kinds of programs that 
you kind of--could actually sort of fit together, if we got 
very creative to do this stuff.
    Again, it's, something--there are costs involved. So, you 
not only need the flexibility to be able to design the program, 
but in some cases access different funding streams which may be 
in somebody's design they were set up for this purpose, and 
only this purpose. In reality we need to be able to move it 
over here. So, there's--that ``super-waiver'', we get back to 
that because that's an extraordinary thing. We didn't explain 
it very carefully, or I didn't in my testimony, but it's any 
program operated by the Departments of Health and Human 
Services, Labor, Education----
    Mr. CAMP. Agriculture.
    Mr. ENGLER. Agriculture and HUD, the U.S. Housing and Urban 
Development Department, I believe is the fifth one. So I mean, 
you could get very, very creative with those kinds of programs. 
We can do some of the things that all of you are being 
advocates for, and just it would--and if you let 50 States try 
this, within the further experimentation that Saginaw might do 
it different than Grand Rapids--or Saginaw County might do it 
different than Kent County, you'll get so many lessons 
happening. Fred, I mean, the thing we stress, we even changed 
in the Governor's Association, our research arm, we call it the 
Center for Best Practices, with the idea being that it is silly 
to try to reinvent the wheel. Let's just--if we--everybody did 
the best thing that somebody else is doing, we would all be a 
whole lot better immediately. So----
    Mr. CAMP. Mr. Carter, you see these programs as primarily 
strengthening families----
    Mr. CARTER. Yes.
    Mr. CAMP. Program? Obviously would have to be valuable, 
because you don't want to have a program over-load type thing 
develop where people are going to too many things.
    Mr. CARTER. Right.
    Mr. CAMP. I guess that--I actually think something like 
that would be a very good idea for part of the 16 hours, 
flexibility that I think hopefully we'll be able to have the 
State be able to define that.
    I wondered, do you think people would be receptive to that, 
parents would be receptive to----
    Mr. CARTER. Yes. Hands down, yes, I know they will. Like I 
said, I have serviced thousands of customers through Work First 
over the years, and everybody seems to sing the same song. This 
is what the people are saying. I know in Detroit, that's what 
the people are saying.
    Mr. CAMP. Okay. Thank you.
    Ms. KOON. I would have to agree with him wholeheartedly. I 
believe they need to keep the career development programs that 
they have in the schools going, and I believe that there needs 
to be after-school programs. I do believe that parents would be 
involved. I would love to see more things available for my 
children. I work sometimes 12 hours. I am not home in those 
evenings, if my husband works late we're not home either. I 
think that there needs to be more available opportunities for 
them to enjoy some fun and incorporate some learning in there. 
I think that would be the wonderful solution.
    Mr. ENGLER. Did you have to take a drug test at your place 
of employment?
    Ms. KOON. Yes.
    Mr. ENGLER. Mr. Carter?
    Mr. CARTER. Yes.
    Mr. ENGLER. Fred, is that a requirement at the office?
    Mr. KELLER. Yes, it's a requirement.
    Mr. ENGLER. Would you have--would it be helpful if somebody 
could be referred to you? I don't know if there's any 
percentage--what happens? What percentage might not pass a drug 
test who are referred by the office? Do you have any knowledge 
or is there--there would be someone, I presume.
    Mr. KELLER. Yeah, I don't have the numbers on that, but 
the--the concept is pre-employment screening and then really is 
to identify the barriers that each individual has and kind of 
go on a program of getting them helped in those areas.
    Mr. ENGLER. One of the things that we've--I'm just curious, 
the reaction, if we said one of the parts of an application for 
assistance was also a drug test so that we can identify that as 
a barrier earlier, is that--one of the things that we're 
finding at Work First agencies is we can work with someone. We 
might put them through the skills development we just talked 
about, they go off to the first interview, everything is fine, 
oh, no, you go over here and take the drug test, not so good. 
We'd like to identify that earlier. We actually tried to do 
that, we got sued and a Federal judge blocked us, but it 
strikes me that makes some--there's logic to this. One of the 
things Congress could do is at least authorize States to 
require drug tests on the front end because we're finding it 
too late. If we've made an investment in the training, again, 
the logic would be invest in those who are ready to go to work 
first. If somebody's got the drug problem, then let's help deal 
with that, as best we can. So, we can then go on and make the 
next investment. I don't know, Ms. Scorsone, are you--I don't 
know if you want to comment on that or not, but----
    Ms. SCORSONE. On whether I think they should have drug 
testing at application?
    Mr. ENGLER. Yeah, could we--what if we required that, or--
whether we refer to Work First, maybe just at the time they 
wrote the application, maybe that's the first step over at Work 
First. Somewhere it's got to happen, it's going to happen at 
the employer.
    Ms. SCORSONE. I honestly have mixed emotions about whether 
they should do it at time of application with our agency. I 
wouldn't be opposed if each employer had mandatory drug 
testing.
    Mr. ENGLER. Well, most do.
    Ms. SCORSONE. At that point, if they're turned down, or 
turned away, maybe something could be implemented where they're 
turned over to another agency that can help them. I'm----
    Mr. ENGLER. My difficulty with that is that we may have 
invested--maybe we've invested 6 weeks of preparation to get 
the person ready to go to work----
    Ms. SCORSONE. Getting it too late----
    Mr. ENGLER. Then they fail the job--then they fail the drug 
test and that 6 weeks. Had that been given to somebody else who 
could pass the drug test, they could go to work. So, that's 
our----
    Ms. SCORSONE. I understand your point of it. I'm just torn 
as to whether it's the right arena for it.
    Mr. KELLER. I would just say that I think establishing the 
barriers at some point in time, and some of them are maybe drug 
or alcohol abuse, or there may be other barriers which they 
have, and identifying those barriers early on so that we can 
have established individual programs for them seems to be the 
smart thing to do.
    Ms. SCORSONE. Another thing, excuse me, with our agency, is 
being able to do an assessment for them. You may not be doing 
an actual drug test, but you can determine early on if drug 
dependency is a problem. It is addressed at that point. They 
get to know the families pretty intimately during the 
assessments and their work with them before they go into the 
work force. I don't think that it's not being caught. There are 
some probably that are----
    Mr. ENGLER. Sure. From an abuse and neglect situation, 
though, if there's a substance abuse problem in the home, then 
that cost of dealing with the addiction is coming out of a 
budget that's pretty meager to begin with already. So, I would 
argue there's another logic there for--just with kids' 
perspective, even aside before the work.
    Ms. SCORSONE. Right.
    Mr. CARTER. I believe that instead of having drug testing 
done on the State level, that maybe we can incorporate it on 
the Work First level, the Michigan Works Agency level to when 
they're referred to orientation. That's part of their 
orientation. We can catch that early on, because I do see 
sometimes that you spend time preparing our customers to go to 
work. They have all the skills and the sharp image, but then 
they can't pass the drug test.
    Mr. ENGLER. We know alcohol is every bit worse a problem 
than the other drugs and so forth. Thank you, Mr. Chairman.
    Mr. CAMP. Okay. Well, thank you. Thank you all for coming, 
again. I really appreciate it. I think this is invaluable, and 
I really appreciate the testimony you made.
    I wanted to note that any person or organization wishing to 
submit a written statement for the printed record of the 
hearing, needs to send that electronically because of a change 
in the House mail policy, to 
[email protected], and then fax a copy 
to 202-225-2610 by Tuesday, April 16. So, that's roughly 2 
weeks.
    Also, anyone may send a written statement to me at my 
district office, which is at 135 Ashman in Midland, 48640. If I 
receive that within the next week, I will be able to 
incorporate that in the record. Again, thank you all for being 
here.
    This hearing is adjourned.
    [Whereupon, at 1 p.m., the hearing was adjourned.]

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