LABOR OR I.R.I.G. OR G.A.O., SOME GROUP WITH THE ---- --I.G. G.
           OR G.A.O., SOME GROUP THAT HAS THE AUTHORITY OF THE GOVERNMENT,
           IF THAT GROUP DETERMINES THERE IS A MISUSE OF FUNDS AND REVOKES
           THE GRANT, THEN THE DOLLARS GET REBID. THE DOLLARS FLOW BACK
           INTO THE POOL, THE POT, THEY AREN'T LOST, THEY GO BACK INTO

           TITLE 5 AND THEY GET REBID. SO FOR EXAMPLE IF ONE OF THE NINE
           GRANTEES WHICH WAS FOUND TO BE ACTING INAPPROPRIATELY, MISUSING
           FUNDS, INAPPROPRIATENESS DOESN'T LOSE YOUR FUNDS BUT MISUSING,
           FUND, FRAUDULENTLY USING FUNDS, THAT GRANTEE LOSES THE FUNDS,
           THE MONEY GOES BACK INTO THE POOL AND LOGICALLY GREEN THUMB OR
           SOME OTHER AGENCY WHICH HAS A RESPECTABLE TRACK RECORD AND
           KNOWS WHAT THEY ARE DOING AND HASN'T BEEN USING THE MONEY FOR
           INAPPROPRIATE ACTIVITIES AND HAS BEEN GETTING THE MONEY OUT TO

           THE SENIOR CITIZENS, THEY WOULD HAVE THE RIGHT TO COMPETE TO
           GET THOSE DOLLARS. THAT'S THE THEME OF THIS AMENDMENT. GOOD
           GOVERNMENT. I WOULD CALL IT. A GOOD GOVERNMENT AMENDMENT. WHY
           DO WE NEED IT?
           WE NEED IT BECAUSE WE HAVE AN EXAMPLE OF ONE OF THESE AGENCIES
           THAT GETS AN ENTITLEMENT ACTING IN A WAY WHICH SEE LENGTHSLY
           HAS BEEN A MISUSE OF FUND YET THERE IS NO WAY TO ESSENTIALLY
           REMOVE THAT AGENCY FROM THE LIST OF PEOPLE THAT GET AN
           ENTITLEMENT. THIS AGENCY IS TODAY CALLED THE NATIONAL SENIOR

           CITIZENS EDUCATION AN RESEARCH CENTER. IT USED TO BE KNOWN AS
           NATIONAL COUNCIL OF SENIOR CITIZENS. I THINK IT IS IMPORTANT TO
           REVIEW THE THINGS THAT THIS GROUP HAS DONE WITH THESE TAX
           DOLLARS WHICH HAVE FLOWED TO IT FOR THE PURPOSES OF HELPING
           SENIORS AND HAVE TURNED OUT TO BE DOING A LOT LESS THAN THAT.
           AND IN FACT HAVE BEEN FOUND BY INNUMERABLE -- INNUMERABLE
           FEDERAL REAP VIEWS TO HAVE ACTUALLY BEEN MISUSING THOSE FUNDS
           IN A WAY THAT IS SIGNIFICANT. NOW, THIS IS NOT A SMALL EIGHT

           SICH. THIS AGENCY EVERY YEAR GETS $64 MILLION IN TAX MONEY
           WRITTEN TO IT AS A CHECK AS AN ENTITLEMENT. $64348. THAT'S A
           LOT OF MONEY TO BE FLOWING TO AN AGENCY WITHOUT ANY
           COMPETITION, WITHOUT ANY OVERSIGHT, IN THE SENSE IT HAS TO JUST
           NIGH HOW IT USES THE DOLLARS OR WHEN IT DOES HAVE TO JUSTIFY
           THEM, ACTUALLY HAVE TO PRODUCE A RESULT AS WE WILL SEE FROM
           WHAT THEY HAVE ACTUALLY DONE AS AN AGENCY. SO IT IS NOT SMALL
           DOLLARS WE ARE FINDING HERE. THE I.G. TOOK A NUMBER OF LOOKS AT

           THIS. I THINK IT IS IMPORTANT TO REVIEW WHAT THE I.G. HAS
           FOUND. THE I.G. HAS FOUND THIS GRANTEE HAS MISUSED OVER $10
           MILLION OF FEDERAL TAX DOLLARS SINCE 1992. 10 MILLION. REMEMBER
           THE I.G. DOESN'T AWE KID EVERY YEAR. SO IT COULD HAVE BEEN
           MORE. WHO KNOWS. FROM AN AUDIT IN 1992-1994, THEY QUESTIONED
           $5.8 MILLION OF DIRECT COSTS CLAIMED BY NATIONAL COUNCIL SENIOR
           CITIZENS AS NOT ALLOWABLE UNDER O.M.B. REGULATIONS. THESE

           REGULATIONS ARE REGULATIONS THAT THE DEPARTMENT DIDN'T ENFORCE.
           $3.8 MILLION NOR HEALTH INSURANCE REFUNDS THAT IT RECEIVED FROM
           INSURERS PROVIDING HEALTH COVERAGE TO SENIORSS PARTICIPATING IN
           JOB PROGRAMS. NOW THIS MAY SEEM LIKE A WORTHY ENDEAVOR
           PURCHASING HEALTH INSURANCE FOR SENIORS. IT IS. BUT THE I.G.
           FOUND THE NATIONAL COUNCIL OF SENIOR CITIZENS PAID PREMIUMS OUT
           OF ITS D.O.L. ACCOUNT, BUT RECEIVED REFUNDS BASED ON FAVORABLE
           CLAIM EXPERIENCES. AND STEPPED OF USING THE REFUNDS TO OFFSET

           THE EARLIER CHARGES TO THE D.O.L. GRANT, THE NATIONAL COUNSEL
           SIF OF SENIOR CITIZENS EVEN LENSLY POTOMACED THE MONEY. UNDER
           FEDERAL REGULATION, CIRCULAR A-12 OF THE O.M.B., THE REFUND
           SHOULD HAVE BEEN CREDITED TO DIRECT THE COSTS OF THE PROGRAM.
           BUT THEY WERE NOT. $1.1 MILLION OF DIRECT COSTS WERE QUESTIONED
           IN 1992 AND 1994 BECAUSE THE NATIONAL COUNCIL OF SENIOR
           CITIZENS CHARGED ITS D.O.L. GRANT THE COST OF INCURRING THE
           ADMINISTRATION FOR THIS HEALTH INSURANCE PROGRAM WHICH THEY GOT

           THE REFUNDS ON. HERE IS A CLEVER LITTLE SCHEME. THEY CHARGED A
           KNEE TO THE INSURER AND CLAIMED THE FEE FOR ADMINISTRATING THE
           PLAN WAS MEMBERSHIP PROMOTION INCOME. THE FEE SHOULD HAVE GONE
           TO REDUCE THE D.O.L. GRANT COSTS AS REQUIRED UNDER THE CIRCULAR
           I JUST CITED, BUT INSTEAD THE MONEY WENT INTO, WHERE?
           THE NATIONAL COUNCIL OF SENIOR CITIZENS POCKETS. WE WILL GET
           LATER AS TO WHAT THAT MONEY WENT TO AND BELIEVE ME IT WAS TO
           THE SENIOR CITIZENS. IT IS VERY INTERESTING WHERE THAT MONEY

           ENDED UP. THIS TRAIL LEAD TO SOME VERY INTERESTING ROADS.
           $580,000 OF THE $850,000 TOTAL GENERAL LIABILITY INSURANCE
           POLICY COST WAS ALSO QUESTIONED DURING THE 1992-1994 AUDIT AS
           NEITHER AN ARM'S LENGTH TRANSACTION, BECAUSE THE INSURANCE
           COMPANY SHARED THE SAME MANAGEMENT AS THE PERSONNEL OF THE
           NATIONAL COUNCIL OF SENIOR CITIZENS. AND WAS NOT COMPEP
           ACTIVELY BID. IN OTHER WORDS THE NATIONAL COUNCIL OF SENIOR
           CITIZENS WAS HIRING ITS LEADERSHIP TO RUN AN INSURANCE COMPANY

           TO INSURE ITS PROGRAMS. THAT -- THAT HAS A VERY SUSPICIOUS NOT
           NOTE TO IT, I WOULD THINK, UNDER ANY, ANY PROGRAM. IT IS A VERY
           DISTURBING FINDING BY THE AUDIT. THIS FINDING WAS THE LIABILITY
           COMPANY WHICH WAS BEING RUN BY THE NATIONAL COUNCIL OF SENIOR
           CITIZENS, A MEERD TO BE RELATED ALMOST ENTIRELY TO THE NATIONAL
           COUNCIL OF SENIOR CITIZENS AND ITS AFFILIATED ENTITIES. MANY OF
           THE INSURANCE COMPANY BOARD MEMBERS WERE MEMBERS OF THE

           NATIONAL COUNCIL OF SENIOR CITIZENS EXECUTIVE MANAGEMENT GROUP.
           THIS IS NOT MY INFORMATION, BY THE WAY. THIS IS INFORMATION
           FOUND BY THE I.G. THE I.G. FOUND THIS LIABILITY TO NOT BE AN
           ARM'S LENT TRANSACTION AND THE D.O.L., DEPARTMENT OF LABOR EVEN
           CONCLUDED ALL OF THE COSTS OF THE POLICIES SHOULD BE
           DISALLOWED. SO YOU HAVE WHAT DAY PEERS TO BE A SHAM CONTRACT.
           NOT AN ARM'S LENT CONTRACT NOR $89 OO,000 THAT WASN'T EVEN
           COMPETED OUT. THE DEPARTMENT OF LABOR HAS AGREED WITH THE BULK

           OF THESE FINDINGS FROM 1992 TO 18994 AUDIT AND ISSUED OO FINAL
           DETERMINATION THAT REQUIRES THE NATIONAL COUNCIL OF CITIZENS TO
           REPAY MILLIONS OF DOLLARS. MILLIONS OF DOLLARS IN QUESTIONABLE
           FUNDS. AS THE AGENCY -- HAS THE AGENCY REPAID THESE FUNDS?
           NO, IT HASN'T. IN THE THEY A IMMEDIATE THE ADMINISTER LAW JUDGE
           AND ARE CURRENTLY IN A DISCOVERY PROCESS. THEN OF COURSE THERE
           IS THE FACT THAT THEM PROBABLY GO TO FEDERAL COURT, ALL THE
           TIME KEEPING THESE FUNDS, WHICH ARE SO CLEARLY BEING MISUSED,
           AND BELIEVE ME THEY ARE NOT RUNNING TO BENEFIT ANY SENIOR

           CITIZEN WHO IS TRYING TO GET A JOB UNDER THIS PROGRAM. ALL
           DURING THIS PROCESS THAT THEY HAVE BEEN RUNNING THIS SHAM
           OPERATION, THAT'S MY TERM, BUT IT IS NOT ARM'S LENGTH
           TRANSACTION WAS THE I.G.'S TERM, ALL DURING THIS PROCESS THEY
           HAVE BEEN RECEIVING $64 MILLION A YEAR, EVERY YEAR, JUST BEING
           PAID OUT. AND THERE ARE OTHER AUDITS ABOUT THIS ORGANIZATION
           THAT ARE WORKING THEIR WAY THROUGH THE DEPARTMENT OF LABOR

           WHICH IS SHOWING THAT THERE ARE EVEN MORE SERIOUS ISSUES AND
           SIGNIFICANT PROBLEMS. AN I.G. REPORT REVIEWING THE 1995 FUNDS,
           THE ONE I WAS TALKING ABOUT REVIEWED 1992 TO 1994  FINDS
           IDENTICAL VIOLATIONS. IDENTICAL VIOLATIONS. IN OTHER WORDS,
           AFTER THEY WERE FOUND TO VIOLATE THE RULES OF THE DEPARTMENT OF
           LABOR, THE RULES OF OFFICE OF MANAGEMENT AND BUDGET, AND THE
           RULES OF OBJECTIVITY, IDENTICAL VIOLATIONS WERE COMMITTED IN
           1995. IT WAS RECOMMENDED THE $2.8348 BE DISALLOWED. THERE ARE

           OTHER AWE DISREVIEWING 1996 AND 1997 AND CALL INTO QUESTION
           APPROXIMATELY $2.7 MILLION. THIS GRANTEE HAS SIMPLY NOT, UNDER
           ANY REASONABLE TEST BEEN ADMINISTRATING THESE FUNDS IN A
           RESPONSIBLE WAY. IT HAS BEEN MISUSING THESE FUNDS. AS IF THESE
           TYPES OF FINDINGS AREN'T BAD ENOUGH, THERE IS ANOTHER AUDIT
           FROM THE I.G. DATED APRIL 24, 19 THE 8, FAIRLY RECENTLY, WHICH

           EXPOSES A $6.1 MORATORIUM SPLUSH FUND AT THE NATIONAL COUNCIL
           OF SENIOR CITIZENS. MAINTAIN FOR OVER 14 YEARS. THIS FUND,
           WHICH THEY EUPHEMISTICLY CALL A "CONTINGENCY FUND," WAS SET UP
           IN 1984 WR# $3.7 MILLION IN FEDERAL FUNDS TO PROVIDE FINANCIAL
           ASSISTANCE TO ENROPE LEASE -- QUOTE -- "IN CASE THE JOBS
           PROGRAM HAD BEEN TERMINATED BY THE CONGRESS OR THE
           ADMINISTRATION." MINORITY LEADER, THEY SET UP A SPLUSH FUND,

           THE PURPOSE OF WHICH WAS TO CONTINUE THE PROGRAM IN CASE
           CONGRESS BY SOME DECISION DECIDED THE PROGRAM WASN'T NIP GOOD.
           IN OTHER WORDS, THEY WERE GOING TO BE AN EXTRAORDINARY FORM OF
           GOVERNMENT. WEAPON NOW HAVE NOT THREE BRANCHES OF GOVERNMENT,
           WE HAVE A FOURTH OVER HERE. IT IS CALLED THE NATIONAL COUNCIL
           OF SENIOR CITIZENS WHICH KEY SIDED THAT EVEN IF CONGRESS
           DETERMINED, WHICH IT HAS NOT, AND WHICH IT WILL NOT, THE TITLE
           5 TINT MAKE SENSE THEY WERE GOING TO CONTINUE TO RUN TITLE 5

           WITH TAX DOLLARS. A NEW FORM OF GOVERNMENT IN OUR MIDST. THE
           PROGRAM WAS NOT TERMINATED OF COURSE. IT IS CONTINUED.
           TESTIMONY CONTINUE FOR AS FAR AS THE EYE CAN SEE BECAUSE IT IS
           A PROGRAM WHICH ON BALANCE WORKED EXTRAORDINARILY WELL FOR OUR
           SENIORS BUT HAS THE SPLUSH FUND BEEN TERMINATED, WHICH WAS SET
           UP IN 1984?
           IN ORDER THAT THERE WAS A CONTINGENCY THAT THIS PROGRAM MIGHT
           BE TERMINATED?
           HAS THAT SPLUSH FUND BEEN TERMINATED?

           NO, IT HASN'T. IT HASN'T. THE I.G. FOUND IT. AFTER THE I.G.
           DISCOVERED THE FUND, BY THEN THE MONEY HAD BEEN TRANSFERRED TO
           A TRUST FUND. IT RECOMMENDED THE MONEY BE RETURNED TO THE
           TREASURY BUT THE NATIONAL COUNCIL OF SENIOR CITIZENS FILED A
           LAWSUIT IN FEDERAL COURT SAYING THEY SHOULD BE ABLE TO KEEP THE
           MONEY. IT SHOULD BE ABLE TO KEEP THE MONEY. THIS IS
           UNACCEPTABLE. IT SHOULD BE UNACCEPTABLE TO ALL OF US. ANYBODY
           WHO IS INTERESTED IN GOOD GOVERNMENT SHOULD SAY ON THE FACE OF

           IT, THIS IS AN UNACCEPTABLE ACTION. BY SOMEBODY WHO IS USING
           OUR FEDERAL DOLLARS IN TRUST NOR THE PURPOSES OF HELPING
           SENIORS GET JOBS. NOW, MANY OF THE GRANTEES WHO PARTICIPATED IN
           THE PROGRAMS, EVEN THE ENTITLEMENT GRANTEES, IN FACT ALL OF THE
           ENTITLEMENT GRANTEES, THEY DO SO WITH THE UNDERSTANDING THAT
           THEY HAVE LOCAL AN COMMUNITY ORGANIZATIONS WHICH THEY BASICALLY
           TAKE MONEY FROM THE FEDERAL GOVERNMENT UNDER THIS ENTITLEMENT
           AND FUNNEL IS OUT TO THE LOCAL COMMUNE ORGANIZATION, WHO MANAGE

           THE MONEY AND PEOPLE THAT THEY ADMINISTER. GREEN THUMB IS THE
           CLASSIC EXAMPLE OF THIS. URBAN LEAGUE WOULD BE ANOTHER EXAMPLE.
           AARP WOULD BE ANOTHER CAN EXAMPLE. IT IS LEGITIMATE. IT IS A
           GOOD WAY TO DO IT. THEY HAVE A NATIONAL ORGANIZATION. THEY
           ACCEPTED IT OUT TO LOCAL ORGANIZATIONS AND THAT'S THE CONCEPT
           BEHIND THIS. THIS IS WHY WE HAD -- I PRESUME ALTHOUGH I DON'T
           KNOW, THIS IS WHY THE ORIGINAL NINE GRANTEES, I HOPE NINE IS
           RIGHT, NINE GRANTEES WERE PICKED WAS BECAUSE THEY WERE

           NATIONAL, BUT THEY HAD LOCAL ORGANIZATIONS OR THAT WAS THE --
           OR THEY REPRESENTED THEY WOULD. THE NATIONAL COUNCIL OF SENIOR
           CITIZENS DOESN'T HAVE LOCAL AFFILIATES. THEN FUNCTION AS A
           MIDDLE MAN PROGRAM. THEY CONTRACT SERVICES AND JOB PLACEMENT
           SERVICES OUT TO OTHER NONPROFIT ORGANIZATIONNESS STATES. SO
           THEY DON'T HAVE A UNIQUE EXPERTISE TO BRING TO THE TABLE. THEY

           ARE SIMPLY AN INTERMEDIARY. AND IN THEIR CASE, THEIR
           INTERMEDIARY WHO TAKES A FAIR AMOUNT OF THE MONEY AND KEEPS IT
           HERE IN WASHINGTON, AS IT WOULD APPEAR UNDER THEIR INSURANCE
           PROGRAM TO BENEFIT AN INSURANCE COMPANY THAT IS AFFILIATED WITH
           IN THE SENSE THAT ITS LEADERSHIP IS THE SAME MEMBERSHIP AS THE
           NATIONAL COUNCIL OF SENIOR CITIZENS GROUP, AND THAT IT CREATES
           A SLUSH FUND WITH THE MONEY, AND IT THE I.G. HAS ON 19192,

           19193, 19194, 19195, 19196 AND 1919 -- 1997 AND 1998, FOUND IN
           VIOLATION OF THE RULES OF DEPARTMENT OF LABOR AND OFFICE OF
           MANAGEMENT AND BUDGET. AND YOU HAVE TO WONDER, WHY DO YOU NEED
           SUCH A MIDDLEMAN?
           WOULD IT NOT MAKE MORE SENSE IF WE ARE GOING TO HAVE
           ENTITLEMENT PROGRAMS THAT WE AT LEAST SEND THEM TO PEOPLE WHO
           ARE USING THE MONEY TO BENEFIT SENIORS AND GIVE THEM JOBS SUCH
           AS THE URBAN LEAGUE, AARP OR GREEN THUMB. AND LET THEM COMPETE
           FOR IT. AND THERE IS SOMETHING EQUALLY DISTURBING ABOUT THIS

           ORGANIZATION BECAUSE AS I SAID EARLIER, WHERE DID THIS MONEY GO?
           WHAT WERE THEY DOING?
           IT IS MY UNDERSTANDING THAT AT ONE POINT ALMOST 90% OF THE
           MONEY OF THIS ORGANIZATION CAME FROM THIS ENTITLEMENT. AND EVEN
           TODAY, THIS ENTITLEMENT MAKES UP A HUGE AMOUNT OF THEIR FUNDS.
           SO, SHOULDN'T THEY BE BASICALLY WORKING ON SENIOR CITIZENS
           ISSUES?
           YES, YOU WOULD SAY THAT'S
           

           LOGICAL: OF COURSE IT IS. WELL, IT TURNS OUT THAT A LAWSUIT IN
           NEW YORK CITY -- A LAWSUIT IN NEW YORK CITY -- INVOLVING THE
           TEAMSTER UNION AND THE ILLEGAL USE OF CASH IN THE ELECTORAL
           PROCESS FOR THE PRESIDENT OF THE TEAMSTER UNION WHICH SOME OF
           YOU MAY REMEMBER INVOLVED TRANSFERRING
{END: 2000/10/26 TIME: 11-00 , Thu.  106TH SENATE, SECOND SESSION}