ment had requested. This was denied by the House and the funds were transferred to our action grant programs, specifically to discretionary grants.

STATE ACTIVITIES

Senator MCCLELLAN. Let's come back to that in a moment. Let me ask you this: Are the States able to fully utilize these grants? Do all the States now have approved plans?

Mr. VELDE. Yes, sir. We now have 55 State planning agencies in full operatiton. That includes all 50 States, plus five territories that were defined as States in the legislation.

Senator MCCLELLAN. In other words, the machinery is all there now, so this can function as contemplated by the statute?

Mr. VELDE. Yes, sir. Fiscal 1970 is the first year where substantial funds, at least in contrast with fiscal 1969, where substantial bloc grant funds are being made available to the States. It remains to be seen whether or not the States and local governments will be able to come up with their share of matching funds.

Senator MCCLELLAN. Where you make these allocations to the State, and the State doesn't come up with their matching funds, then funds are not released to that State, they are retained? They then are availabel for application to other States who can match them?

Mr. VELDE. No, sir. They revert to the Treasury under existing law. Senator HRUSKA. They do not add them to the moneys available for discretionary grants?

Mr. VELDE. No.

Senator HRUSKA. They revert to the Treasury?

Mr. VELDE. Yes. We are requesting additional legislative authority in pending amendments to our authorizing legislation to allow us in effect to redistribute those funds. At present we do not have authority to do that.

Senator MCCLELLAN. You mean to the States that could match them? Mr. VELDE. Yes, that is correct. Right now we don't have the authority.

NATIONAL INSTITUTE OF LAW ENFORCEMENT: HOUSE DENIAL OF INCREASE AND TRANSFER OF FUNDS TO ACTION GRANTS

Senator MCCLELLAN. You were on page 10 of your prepared statement. That is where you discuss the funds with respect to the National Institute. You say here:

We requested a significant increase-$11.5 million-for the National Institute of Law Enforcement and Criminal Justice. The House committee did not concur in this request but directed, instead, that the $11.5 million increase should be added to action grants.

In other words, they allowed you all the money you requested but they took this money away from the Institute and put it in action grants?

Mr. VELDE. Yes.

Senator MCCLELLAN. They indicated that any portion of this sum could be utilized by LEAA for other activities. What is your position on this with respect to the Institute in wanting these funds restored back to the Institute?

Mr. VELDE. We concur with the House action, with the House committee report, which directed us to transfer these funds to action funds. Under the customary procedure, if it develops during the course of the fiscal year that additional funds beyond the $7.5 million could be used effectively for research purposes, then we will notify the committees of our intent. Assuming that we can justify additional funds for the Institute and that there is House and Senate committee approval, then, of course, they can be reprogramed back to the Institute. Senator MCCLELLAN. Why did this happen? Did you ask for more money than you could properly spend in Institute activities?

Mr. VELDE. No, sir. I believe there was dissatisfaction on the part of the House committee with some of the programs that the Institute had initiated in fiscal years 1969 and 1970.

Senator MCCLELLAN. Like what?

DEVELOPMENT OF PRACTICAL HARDWARE

Mr. VELDE. A number of programs in the corrections and in social science areas. The House committee wanted us to emphasize development of practical hardware. Of course, by your experience with research activity in the defense community and elsewhere, the pipeline in the development of practical hardware is spread out over a period of time. You just can't come up overnight with dramatic breakthroughs. It takes time; it takes a substantial investment of funds.

Senator MCCLELLAN. In other words, the House felt a lot of this money was not being channeled toward what would be practical results, and effective results. Is that correct?

Mr. VELDE. Yes, sir.

Mr. PELLERZI. I think there was also the factor, Senator, that the expenditures by the Institute at the time of the hearings were relatively low. It was funded at, I believe, $7.5 million last year. At the time of the hearings. I don't think they had obligated much in excess of 50 percent of that.

Senator MCCLELLAN. Did you return to the Treasury much of the appropriations last year?

Mr. VELDE. No, sir. In fiscal 1969 $3 million was appropriated for the Institute. With the fiscal 1970 appropriations bill not being signed into law until December 22, the continuing resolution authority for the Institute was at the 1969 level. So it did show, obviously, that there was not a significant obligation until we knew the final amount of the fiscal 1970 appropriation.

Senator MCCLELLAN. You want to go along with the House on it? Mr. VELDE. We feel there is sufficient flexibility in the House action so that as additional projects are developed and the need for the funds becomes apparent, then utilizing this procedure, we can fund them.

Senator MCCLELLAN. Did you submit an estimate for $19 million? Mr. VELDE. That is correct.

This $11.5 million, the full amount of the increase, is being reprogramed into the discretionary funds. If it develops later in the fiscal year that the Institute can justify any or all of this increase with programs that meet the approval of committees, then the funds will be there.

Senator MCCLELLAN. Senator Smith?

CORRECTIONS PROGRAMS

Senator SMITH. Have any requests come in for upgrading the State prisons to date?

Mr. VELDE. Yes, Senator. We estimate as the statement indicates, that about $50 million of bloc grant funds will be utilized for the purpose of upgrading corrections, particularly community-based and regional facility programs.

Senator SMITH. But you don't do that unless the request comes in from the State?

Mr. VELDE. Under the bloc grant procedure, the allocations of funds are made to the States according to population. Then the States set their own priorities and make their own sub-grant awards. For this fiscal year, the States are indicating that they are spending about 30 percent of their total bloc grant funds for corrections improvement programs.

Senator SMITH. What happens to that money if they don't use it? Mr. VELDE. If, for example, a corrections project is planned and it doesn't get off the ground either because the matching money is not there or the decision is made that other programs are of higher priority, then the State with LEAA approval can reprogram those funds to a different purpose. But it does take LEAA approval. In effect, it is a variance from the original plan that had been submitted to LEAA.

STATE UTILIZATION OF FUNDS

Senator SMITH. Mr. Chairman, I think it would be well to have for the record some kind of a table so that we would get an idea of what the States are doing, how they are spending this money and whether they are taking advantage of the original purpose.

Senator MCCLELLAN. Would you do that, and make a general statement now?

(The table follows:)