Mr. HARDING. Sir, I quoted some sources in terms of our responsibilities to rehabilitate juvenile delinquents and criminals which is in our Senate report. Headstart was never specifically written into the initial legislation, but the Director was granted a broad responsibility to develop and administer programs designed to correct the root causes of poverty.

He was also given very specific research and development responsibility or authority, and it was understood, this authority that he devised, or the organization devised, literally hundreds of projects that were perhaps subsequently discussed with our committees but did not come in for prior approval.

I doubt very seriously that you would want to suggest that each and every project would require prior congressional approbation. Senator CURTIS. No; but I thought it was a project for the poor. Mr. HARDING. It is a project for the poor.

Senator CURTIS. The leadership of these gangs were not poor and they were not qualified to teach.

Mr. HARDING. They were used as a means of getting to the poor and, therefore, it seems to me quite legal under our authority; the same as we used medical doctors and engineers and all sorts of people.

Senator CURTIS. If someone had gone to medical school and prepared themselves and you used them, that is one thing.

Mr. HARDING. But they are not poor and they are paid out of OEO

money.

Senator CURTIS. I know; but the leaders of gangs cannot be compared to utilization of medical talent or business executives' talent I am sure. That is all, Mr. Chairman.

The CHAIRMAN. You spoke yesterday about the number of people that got jobs as a result of this. I think you said 60 are still working. Mr. HARDING. Those are the figures that we had at the last census taking; yes, sir.

The CHAIRMAN. How long ago was that?

Mr. HARDING. Frankly, Mr. Chairman, I think that particular line was written in this statement at the time I was scheduled to testify in June. I am not sure whether we have updated that figure or even if we have updated it.

The CHAIRMAN. Back quite some time ago?

Mr. HARDING. Yes, sir.

The CHAIRMAN. We had a staff member check it out and they tell me that 40 were actually working.

Mr. HARDING. We lost 20 out of the 60.

The CHAIRMAN. I think they checked it out.

Mr. ADLERMAN. Only 40 were employed as of July 17.

The CHAIRMAN. Now I want to get one or two figures here that you gave yesterday. I want to see how much this experiment is costing us.

You said there was only $760,000 actually expended although there was a grant of $927,000; is that correct?

Mr. HARDING. That is what appears in the statement, Mr. Chairman. I was given a corrected figure just prior to the hearings yesterday of $714,000, which is what I stated as I read the statement.

The CHAIRMAN. You had two contracts to service this. These service contracts were in addition to this?

Mr. HARDING. No, sir; these were part of the contracts. The CHAIRMAN. Does this include the University of Chicago? Mr. HARDING. I beg your pardon, the University of Chicago was a separate contract over and above this.

The CHAIRMAN. How much did you pay out on it?

Mr. HARDING. We paid out approximately $50,000 as I recall the contract was initially set at.

The CHAIRMAN. Then you had a contract with, what was it?

Mr. HARDING. The Urban League and the Xerox Corp. contracts were subcontracts to the two contracts and, therefore, are encompassed within the $714,000.

The CHAIRMAN. So, you got $764,000 in direct costs involved that you have actually expended. How much would you say the overhead and the servicing from the administrative standpoint, the home office, and regional office, and so forth, would be-how much would you charge to this project during the time that it was in operation?

Mr. HARDING. That would be a very difficult figure to come up with, Mr. Chairman, particularly when you consider the cost of the agency in connection with the support of this committee and its investigation. If that figure were to be put in it would be rather large.

The CHAIRMAN. Support of what?

Mr. HARDING. The support of your committee investigation.

The CHAIRMAN. Forget about the investigation. I am interested in what you paid out to send your men down there and get it organized, and so forth, and whatever supervision you gave to it.

Mr. HARDING. There would probably be a couple man-years involved in that support, travel, maybe $30,000 or $40,000.

The CHAIRMAN. All right, we will take the smallest figure, $30,000. That would be $794,000. You said there were 60 employed and we found a month later there were only 40 of them still working.

Suppose we take 50 as the number. Do you realize that that figure is nearly $16,000 each for jobs? That is what it cost you to put them to work?

Mr. HARDING. Yes, sir. I figured that, myself, and it was pretty frightening. That was one of the major factors that I had in mind when I decided that the project had not qualified sufficiently for refunding.

The CHAIRMAN. What does it usually cost to get some of the poor unemployed a job? How much do you figure that costs if you follow the traditional practices and routine?

Mr. HARDING. I guess the nearest thing I could come to, would be to say the Job Corps runs $6,500, average per trainee. The CHAIRMAN. So this cost 21⁄2 times as much.

Mr. HARDING. At least.

The CHAIRMAN. Do you know whether any of them are actually working now, the 40?

Mr. HARDING. No, sir; I don't but I can certainly find out and supply the information.

(The information supplied by OEO in answer to the preceding question follows:)

Your request for the number of trainees currently employed appears on Page 5804 of the hearings transcript. The last official count available to OEO was 114 placements as of July 1, 1968, with 61 enrollees still on the job. We understand,

however, that the Chicago Urban League is conducting a current survey which ought to be completed by the middle of November.

The CHAIRMAN. I wish you would. I think you should.

Let me ask you two or three other things. You had this university hired to supervise it and to evaluate it. What was the contract with the university?

Mr. HARDING. It was for evaluation solely, not for supervision. The CHAIRMAN. For evaluation solely. You paid them something like $50,000?

Mr. HARDING. Yes, sir.

The CHAIRMAN. Do you have their evaluation reports?

Mr. HARDING. We do not have their final report; no, sir.

The CHAIRMAN. How many reports do you have!

Mr. HARDING. I have seen one, myself. We have a second interim report.

The CHAIRMAN. When did you get the first report?

Mr. HARDING. June, as I recall.

The CHAIRMAN. June of this year?

Mr. HARDING. Yes, sir.

The CHAIRMAN. At the time we called on you first, the committee called on you first for a report, you had no report from them, did you? Mr. HARDING. I don't recall specifically, Mr. Chairman, whether or when you called for a report but we did get the first report on June 10 or 11.

The CHAIRMAN. Does it reflect that they made inspections of the project?

Mr. HARDING. The report that we got?

The CHAIRMAN. Yes.

Mr. HARDING. Yes, sir; it did.

The CHAIRMAN. When was the contract made with them to make this evaluation? When was the contract dated?

Mr. HARDING. December, as I recall, Mr. Chairman.

The CHAIRMAN. December?

Mr. HARDING. 1967.

The CHAIRMAN. Did it call for a date for a report?

Mr. HARDING. Yes, sir; it had a reporting date on it, with interim reports.

The CHAIRMAN. What were the dates they were to make reports? I was reading yesterday from some of the reports. I wonder if this report did not reach you in June.

As I recall, students of the university went down and made inspections and looked at the project. As I recall they reported back that during the time they were there, the largest number of enrollees they found at any one time was about 15 people when there was an enrollment maybe of 45, that was at 2:30 in the afternoon.

If I can find it I would like to quote it exactly. Anyway, the university students went there and found them doing nothing. One of them said the enrollees were smiling and seemed to be in a happy mood. Nobody was studying. Other reporters said they went back and they found nobody there at different times. I don't want to misquote it, that is the only reason I am trying to locate it. I am reading from some of the reports of these students that went down there to look at the situation-this was February 19, which was the last workweek in February.

Fifty-five were registered. The center chief, Adam Batista, reported three absentees. That is what he reported. They reported full attendance except three. These are questions I asked.

I asked, "What did the inspector evaluate from the college report," meaning the university?

Mr. HARDING. Whom were you questioning here, Mr. Chairman? The CHAIRMAN. At this point I was questioning Dr. Dunne, a member of the staff. Here is what he read from the report.

The evaluator from the University of Chicago said as I previously mentioned the director of the center seems to sign in all the 35 boys regardless of whether or not they are actually there. I noted in the classroom that there were very few boys there and that no particular class work was going on.

This was quoted from exhibit 222. What is that exhibit?

Mr. ADLERMAN. This is a report made by the representative of the University of Chicago who was sent out to check on this.

The CHAIRMAN. The testimony goes on,

Two members of the University of Chicago evaluation team arrived at 1:30 p.m. One report stated that there were approximately 10 trainees at the center. We were at the center for approximately an hour, until 2:30. The form reflects 10 present upon their arrival and only five present when they left at 2:30. Dr. Cassanova Turner, who is an associate of Dr. Spergel, in the evaluation project filed a report on this visit and wrote "I cannot give a general impression of the training since there was no training going on. The atmosphere of the center, however, was warm and pleasant. Most of the people seemed to be smiling and in a good mood.

In another one Mr. Doulder's records reflect that 57 were present; 57 were paid for that morning. This was in March; March 28.

On the following day, March 29, the university evaluator was there at 10:30 a.m. and here is what he reported: There were about 15 trainees present. None of the boys were engaged in the business of the TWO manpower project. Tony Gibbs who was acting project director suggested that I not return to the center until I was able to explain to Jeff Fort what the research was all about.

Jeff Fort is the boss. They had to get permission from him.

Well, Mr. Harding, it seems to me, and you can make such explanation of it as you think proper, that a project of this type, certainly one that you call daring, whatever that means, highly experimental, and dealing with the character and reputation of these folks, that you would want reports to know whether this thing was going along all right.

The contractor was paid $50,000 here to get information. Now we didn't get a report for 6 months. Even after these observations were made in February and March, you didn't get a report on it until sometime in June.

Now why was not an interim report required as they went down to make these inspections? Why pay $50,000 and get nothing out of it?

Mr. HARDING. Mr. Chairman, of course I do not want to place myself or the agency in the position of condoning the lack of attendance at these centers. I think the main point that should be made here, however, is that the University of Chicago's role was to gather data regarding the progress of the project, the results of the project, the placement of the kids, the type of training that was going on, its current value, et cetera.

It was not the monitoring.

The CHAIRMAN. What was the university to do with it after it got that information?

Mr. HARDING. It was to analyze all these data and give us a report as to the values or failures of the project.

The CHAIRMAN. When were you going to get that? After the project was all over?

Mr. HARDING. No, sir; we were supposed to get that approximately at the end of the first year of operation which would have been some time in October.

The CHAIRMAN. This year?

Mr. HARDING. Yes, sir; the final report. The final report of the first year's operation.

The CHAIRMAN. For the good it has done it wasn't worth 50 cents because no action was taken as a result of these evaluations. It seems to me that is $50,000 just thrown away. If you are going to have them go there and evaluate it how are you going to take any action unless you get the evaluation and take into account and act upon what they sug gest, take whatever action they suggest should be taken?

It looks to me as if it was just thrown away.

Mr. HARDING. Senator, in nearly all these research and demonstration projects we do contract with some outside, supposedly objective, professionally qualified agency, to go in and look at the project during the time it is in progress and then give us an analysis of the project in order that we can make a determination as to whether or not we want to duplicate that project in other locations and under other circumstances and at other times.

The CHAIRMAN. Wouldn't you want to get those reports whenever they go there and see these things so that you could take action to correct those problems?

Mr. HARDING. I think that particular role was to have been played by the sponsoring agency, TWO and this monitoring committee which was set up in which the regional office was represented and which occasionally headquarter's people went out.

There were other visits made other than those to this project. This was not the primary reason for their going, in order to supervise the operation. It was to gather data.

The CHAIRMAN. I think the $50,000 was completely wasted I don't think one dollar's worth of good came from it. Wouldn't you like to have known when they went down and made these inspections and evaluations, wouldn't you have liked to have known what they evaluated? They said there was nothing there to evaluate.

Mr. HARDING. I would have flown there.

The CHAIRMAN. Why didn't you have a contract requirement to have them make a report so that you could get information?

Mr. HARDING. The design of the project was that it was to be supervised by other sources.

The CHAIRMAN. Did they report these conditions to you?

Mr. HARDING. They did not.

The CHAIRMAN. Who was supposed to report these conditions to you?

Mr. HARDING. Dr. Spergel was supposed to make an interim report and final report at the end of the first year of operation.

The CHAIRMAN. If he did not supply it, why did you pay them?