With the National and Community Service Trust Act of 1993 (P.L. 103-82), the Congress created the largest national and community service program since the Civilian Conservation Corps of the 1930s. AmeriCorps*USA allows participants to earn education awards to help pay for postsecondary education in exchange for performing community service that matches priorities established by the Corporation. Participants earn an education award of $4,725 for full-time service or half of that amount for part-time service. A minimum of 1,700 hours of service within a year is required to earn the full $4,725 award. The Corporation requires that programs devote some portion, but no more than 20 percent, of participants’ service hours to nondirect service activities, such as training or studying for the equivalent of a high school diploma. To earn a part-time award, a participant must perform 900 hours of community service within 2 years (or within 3 years in the case of participants who are full-time college students). Individuals can serve more than two terms; however, they can only receive two education awards. The awards, which are held in trust by the U.S. Treasury, are paid directly to qualified postsecondary institutions or student loan lenders and must be used within 7 years after service is completed. In addition to the education award, AmeriCorps*USA participants receive a living allowance stipend that is at least equal to, but no more than double, the average annual living allowance received by Volunteers in Service to America (VISTA) participants—about $7,640 for full-time participants in fiscal year 1994. Additional benefits include health insurance and child care assistance for participants who need them. Individuals can join a national service program before, during, or after postsecondary education. A participant must be a citizen, a national, or a lawful permanent resident of the United States. A participant must also be a high school graduate, agree to earn the equivalent of a high school diploma before receiving an education award, or be granted a waiver by the program. Selection of participants is not based on financial need. Corporation used about $149 million of its fiscal year 1994 appropriations to make about 300 grants to nonprofit organizations and federal, state, and local government agencies to operate AmeriCorps*USA programs. Grant recipients use grant funds to pay up to 85 percent of the cost of participants’ living allowances and benefits (up to 100 percent of child care expenses) and up to 75 percent of other program costs, including participant training, education, and uniforms; staff salaries, travel, transportation, supplies, and equipment; and program evaluation and administrative costs. Grants are based in part on the number of participants the program estimates it will enroll during the year. If participants leave the program during the year, the Corporation may either allow the program to redirect participant stipend and benefit funds to other program expenses or take back any unused portion of the grant. To ensure that federal Corporation dollars are used to leverage other resources for program support, grantees must also obtain support from non-Corporation sources to help pay for the program. This support, which can be cash or in-kind contributions, may come from other federal sources as well as state and local governments, and private sources. In-kind contributions include personnel to manage AmeriCorps*USA programs as well as to supervise and train participants; office facilities and supplies; and materials and equipment needed in the course of conducting national service projects. Consistent with AmeriCorps’s enacting legislation, some federal agencies received grants during the initial 2 program years to support AmeriCorps*USA participants who performed work furthering the agencies’ missions. Federal agency grantees could use their own resources in addition to the Corporation grant to integrate national service more fully into their mission work. the smallest share of resources, amounting to about 12 percent (or about $41 million). Most of the Corporation’s funding for AmeriCorps*USA projects went to providing operating grants and education awards. Of the Corporation’s funding, 61 percent financed operating grants. Slightly over one-quarter supported participants’ education awards, while the remainder went toward Corporation program management and administration. Most of the matching contributions AmeriCorps*USA programs received came from public as opposed to private sources. About 69 percent of all matching resources came from either a federal or a state or local government source, with the split between cash and in-kind contributions being about 43 percent (about $57 million) and 26 percent (about $34 million), respectively. The remaining 31 percent of matching resources were from private sources, with cash and in-kind contributions accounting for 17 percent (about $23 million) and 14 percent (about $18 million), respectively. In calculating resources available on a per-participant and per-service-hour basis (see table 1), we found that the average from all sources per AmeriCorps*USA participant was about $26,654 (excluding in-kind contributions from private sources). This amounted to about $16 per service hour or about $20 per direct service hour, assuming 20 percent of the 1,700 hours of total service was nondirect service time. These figures represent resources available for all program expenses and are not the equivalent of annual salaries or hourly wages for participants. National Service Programs: AmeriCorps*USA—First-Year Experience and Recent Program Initiatives Corporation for National and Community Service We calculated available resources per participant on a full-time-equivalent (FTE) basis. It is important not to equate our funding information with cost data. Because most AmeriCorps*USA programs were still implementing their first year of operations, actual cost could not be determined. Funding and in-kind contributions from sources other than the Corporation were reported to us in May 1995 as resources already received or those that program directors were certain of receiving by the end of their current operating year. Therefore, actual resource and expenditure levels could be higher or lower than indicated by the estimates reported to us. federal agency grantees had about $15,500 in cash and in-kind contributions available per participant from federal sources other than the Corporation. Non-Corporation federal funds accounted for about 50 percent of total resources available to federal grantees. Nonfederal AmeriCorps*USA grantees received resources of less than $800 per participant from non-Corporation federal sources, or about 3 percent of their total resources. The appendix contains more detailed program resource information by sponsoring agency. In its mission statement, the Corporation had identified several objectives that spanned a wide range of accomplishments, from very tangible results to those much harder to quantify. During our site visits, we observed local programs helping communities. AmeriCorps*USA has also sponsored an evaluation of its own that summarized results at a sample of programs during their first 5 months of operation and identified diverse achievements related to each service area. participants renovating inner-city housing, assisting teachers in elementary schools, maintaining and reestablishing native vegetation in a flood control area, analyzing neighborhood crime statistics to better target prevention measures, and developing a program in a community food bank for people with special dietary needs. AmeriCorps’s legislation identified renewing the spirit of community as an objective, and the program’s mission includes “strengthening the ties that bind us together as a people.” We observed several projects focused on rebuilding communities. For example, a multifamily house being renovated was formerly a congregating spot for drug dealers. Program officials believe that after completion, it will encourage other neighborhood improvements. Another team built a community farm market and renovated a municipal stadium, both of which a town official said will continue to provide economic and social benefits to the community. Another way to meet this objective was to have participants with diverse backgrounds working together. Participants of several programs we visited spanned a wide age range, from teenagers to retirees. Teams also showed diversity in educational, economic, and ethnic backgrounds. Participants said that a valuable aspect of the program was working with others with different backgrounds and benefiting from their strengths. Another of AmeriCorps*USA’s program objectives was to foster civic responsibility. We saw evidence of this at programs such as one where participants devoted half of each Friday to working on community service projects they devised and carried out independently. Participants at another program, in which they organized meetings to establish relationships between at-risk youth and elderly people, commented that this work had taught them how to organize programs, experience they believed would be helpful as they took on roles in their communities. Training periods included conflict resolution techniques and team-building skills. education or job training. At the sites we visited, participants indicated that the education award was an important part of their decision to participate in AmeriCorps*USA. Programs also supported participants in obtaining high school diplomas or the equivalent. According to Corporation regulations, a full-time participant who does not have a high school diploma or its equivalent generally must agree to earn one or the other before using the education award. In one program, a general equivalency diploma (GED) candidate was receiving classroom instruction and individual tutoring. She had recently passed the preliminary GED test after failing the GED test five times. After doing some extra preparation for the math portion, she will take the actual GED test again. A larger program that recruited at-risk youth, most of whom do not have high school diplomas, provided classroom instruction related to the service that participants performed, such as a construction-based math curriculum. Program officials said most of the participants are enrolled in high school equivalency courses and that at least five have already passed the GED test. We also saw programs that offer participants the chance to get postsecondary academic credit. One such program, affiliated with a private college, offered participants the option of pursuing an environmental studies curriculum through which they can earn up to six upper-level credits at a reduced tuition. Half of the participants have chosen to do so. A second program allowed participants to earn 36 credit hours toward an associate’s degree in the natural sciences through their service, which can lead to state certification as an environmental restoration technician. Since we reported on the program last October, both the Congress and the Corporation have implemented measures aimed at lowering AmeriCorps’s cost. On the legislative side, the Congress mandated new funding restrictions for the Corporation. On the programmatic side, the Corporation, after consulting with Members of Congress, has revised its grant guidelines. These new measures will only affect programs receiving grants for the upcoming 1996-97 program year. federal agencies ineligible to receive AmeriCorps grants. The law also requires that to the maximum extent possible, the Corporation (1) increase the amount of matching contributions provided by the private sector and (2) reduce the total federal cost per participant in AmeriCorps programs. As part of the fiscal year 1996 appropriations act, the Congress also mandated that GAO further study the Corporation’s operations. We expect to complete our study by the end of this fiscal year. In recent months, the Corporation has worked with Members of Congress to identify ways to reduce AmeriCorps’s program costs. Subsequently, the Corporation has revised its grant application guidelines for programs receiving funding in the upcoming 1996-97 program year. For example, in response to congressional concerns over the cost of mandating the purchase and use of uniforms, the AmeriCorps*USA uniform package (t-shirt, sweatshirt, button, and so on) is no longer a program requirement. The Corporation also has directed grantees exceeding a program year 1995-96 cost per participant of $13,800 to reduce their proposed program year 1996-97 per-participant costs by an overall average of 10 percent. The Corporation has also increased the grantee’s share of total program operating costs from 25 to 33 percent for grants awarded for the 1996-97 program year. The Corporation’s revised grant guidelines also seek to reduce costs by encouraging a program requesting increased funding to add additional participants, thereby reducing its cost per participant. The guidelines also encourage programs to seek additional funding only for education awards. Corporation’s words—“get things done.” Total resources available means many things. It means cash and in-kind contributions that pay participants’ living allowances, social security taxes, health insurance, child care, and the education awards they earn in exchange for their service. It means resources available to pay local program staff who manage operations and supervise staff; to pay rent for office space and purchase supplies; to pay for travel and transportation for program staff and participants; and to pay for materials needed to conduct national service projects. It means resources available to pay for planning grants used to design and formalize future national service programs. And it means resources available to pay for the staff and operations of the Corporation for National and Community Service. Our objective was not to draw conclusions about whether AmeriCorps*USA was cost-effective. Rather, it was to gather information on the total amount of resources available to AmeriCorps*USA programs nationwide and to provide this information by resource stream—that is, by federal, state, and local government and private sources. Though not precise cost data, this information illustrated the funding levels that may be needed to support new program endeavors of similar scale in the future. It also indicated the degree of partnership between the public and private sectors. Since we completed our review, the Congress and the Corporation have undertaken a number of measures that are intended to reduce the costs of AmeriCorps. Because many of these initiatives will not take effect until the upcoming 1996-97 program year, it is too early to determine their impact. Madam Chairman, that concludes my statement for the record. For more information about this testimony, please call Wayne B. Upshaw at (202) 512-7006 or Carol L. Patey at (617) 565-7575. Other major contributors to this testimony included C. Jeff Appel, Nancy K. Kintner-Meyer, and James W. Spaulding. Corporation award (adjusted) $12,071,004 $31,881,332 $3,470,008 $2,333,452 (Table notes on next page) The first copy of each GAO report and testimony is free. 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Summary: GAO discussed the Corporation for National and Community Service's AmeriCorps*USA service program. GAO noted that: (1) for program year 1994 to 1995, the Corporation provided almost $149 million for grantee projects; (2) about 69 percent of matching project contributions came from public sources; (3) total resources available per participant, exclusive of private in-kind contributions, averaged $26,654, of which federal sources provided 74 percent, state and local governments 14 percent, and the private sector 12 percent; (4) cost data could not be determined because most AmeriCorps programs are too new; (5) total available resources for AmeriCorps*USA grantees averaged about $16 per service hour; (6) grantees' projects are designed to meet unmet human, educational, environmental, and public safety needs, strengthen communities, develop civic responsibility, and expand educational opportunities for program participants and others; and (7) to reduce government costs in the 1996-1997 program year, Congress has reduced program appropriations and prohibited federal agencies from receiving AmeriCorps grants, and the Corporation has required certain grantees to reduce proposed costs by 10 percent and all grantees to pay a higher share of program operating costs.