##VIDEO ID:EhPGPz4XiSo## e e e for for spe for e spe e e spe spe e talk before you for for spe spe for spe spe [Music] [Music] you [Music] e for e [Music] [Music] spe [Music] so [Music] [Music] spe for the subcommittee on higher education Workforce Development will come to order I note there there's a quorum present without objections the chair is authorized to call a recess at any time uh it is truly a great honor to be entrusted with ensuring taxpayer dollars are used efficiently and effectively with that honor come serious responsibilities if we're going to ask taxpayers to Dole out more of their hard hard-earned money it should be worth it unfortunately Mar corpse has a long history of abusing taxpayer dollars Mar corpse is entrusted with over1 billion dollar of taxpayer funds each year with a result of a failure of eight consecutive audits in 2023 the am Inspector General issued a management challenge report detailing significant challenges to the Amica uh that America faces this includes being unable to defect detect fraud we have no idea when America Americans will be able to have a clean audit again in fact this year's audit includes 78 recommendations still open even after Mar Court said it addressed 20 last year normally this will give people give folks a pause if a bank failed a consecutive Audits and was unable to detect fraud would you still be willing to give your hard on money to that bank apparently apparently the answer to the Democrats is yes Democrats want to expand this agency and increase its budget to $80 million more in taxpayer funds despite his longstanding history of financial failure the bid uh Harris Administration has also has also been routing his radical climate agenda through America's foreign funding in September 23 2023 president uh Biden announced its American climate corpse ACC initiative which used americ Corps dollars taxpayer dollars to achieve so-called environmental justice it makes no sense to expand this agency or give it more money when it continually continually fails to meet basic accountability standards every time its Representatives come before this committee Mar assures us that they will they will Implement reforms and year after year nothing changes we can tell americs we can tell americs to modernize modernize and reform until we're blew in the face but nothing will change unless we recognize the system is built on a flaw idea it's time to admit that this is a failed program that needs a complete overhaul or elimination it should be on the Dodge chopping lock chopping block Doge chopping block I recognize that many of America's uh programs are well intentioned but this doesn't outweigh a significant problems too often often the problem has been to drain a drain on the taxpayer funds with fewer and fewer results to show it's worth the cost our country is known for its robust civil institutions America cross aside the US is often ranked as the most generous country in the world when it comes down to money donated or time given to charity Americans don't need a federal federal bureaucrats telling them what to do what they are they naturally do we also don't need a federal program to do what the private sector accomplishes very well at half the cost bottom line America's long history of being unable to manage resources entrusted to it with any sense of accuracy or fiscal responsibility is shameful I look forward to shedding additional light on this issue and bringing a sense of accountability before I recognize the ranking member for opening her opening statement I wanted to make a few moments to recognize our committee chairman uh Dr Fox I was um fortunate to play 40 years ago with the Raiders when they used to win football games all the time and um there was a culture that was developed by our our owner Al Davis it a culture that no matter where you came from you were proud to step on the field you gave everything you can uh to make sure you you were a good member of that team uh I I must say I'm I've been very proud to experience that again uh what Dr Fox has done uh for this committee is first of all well highlighted is as been as a national security issue that we need to make sure that we're providing presenting the very best in the world of terms of our young people and she's done that uh to be to say that we have now a a committee that is is ranked as a priority to our conference along with China and the budget there's education and Workforce so I can't say enough about the honor to have had a chance to serve with Dr Fox the good thing she's not leaving us the Legacy will continue here on the hill but I just want to take a few minutes say thank you so much and that I'll pass it over to my ranking member thank you chairman Owen I want to thank our Witnesses for being here today it's so good to see you again Michael Smith and it's a pleasure to meet you Steph rer this morning we are meeting to examine the role of Amer cor a vital force and strengthening communities through service opportunities but we cannot ignore its Financial struggles which have hindered its mission for years as a committee and members of Congress our responsibility is clear we must equip americore with the resources oversight and accountability it needs to succeed unfortunately my colleagues on the other side of the owl see this as a chance to eliminate americore in the name of government efficiency but let's be clear this isn't about fixing problems for Republicans it's about playing politics despite the financial struggles that America has dealt with for years committee Republicans have neglected proper oversight in accordance with house rules until now when it is politically convenient for them to do so it's downright shameful and honestly a bit pathetic that Republicans are twisting America's Financial hurdles which the agency is already addressing into an excuse to bully and politicize an organization that stands for the very heart of American democracy despite challenges americore has consistently delivered for Americans since 1993 americore has provided vital relief to millions of Americans managing 3,300 projects annually and offering service opportunities to 200,000 members and volunteers these projects have been crucial to disaster recovery from rebuilding homes after Hurricane Katrina to to delivering water of water filters during the Flint Water Crisis during the covid-19 pandemic americore supported students fought food insecurity aided homebound seniors and coordinated vaccination clinics proving itself essential in our nation's recovery additionally americore doesn't just build communities it builds Futures by creating Pathways to higher education for thousands of Americans members serving in americore programs are eligible for Education Awards to cover the cost of higher education and job training americore members have received over five billion dollar to help them pay for college or repay student loans and let let me remind this committee that fixing the student loan crisis should be one of our many many goals if solving the student loan crisis is our mission gutting a program that does exactly that is down Route absurd Americar plays a vital role in the lives of countless Americans which is why we must acknowledge and help fix its Financial challenges we as Congress should be in the business of solving problems not eliminating vital programs since 2017 americore has struggled to implement a strong financial management system leaving it without the tools to manage grantees or prevent waste and mismanagement properly the agency Financial hurdles are clear with seven straight disclaimed audits since F wide 2024 and outdated systems but these issues are solvable and committee Democrats do not take responsibility for overseeing aera core lightly but there's no reason to dismantle an agency that serves Millions when the path forward is to invest in the proper oversight and support to get it back on track to do so would Rob Americans of much needed Aid AAS jobs and set a dangerous precedent of using government oversight as a stick to beat government institutions with instead of a constructive tool to Aid them I look forward to hearing from our Witnesses today on how a amacore plans to work with Congress to ensure strong continuing oversight and the development of robust Improvement to address the agency's ongoing management challenges before I yeld back I want to acknowledge that this is chair woman's Fox's final hearing with this committee thank you Dr Fox thank you for your years of commitment to students and to workers I met you during my first year on this committee and I believe I know your heart thank you and I yeld back thank you so much appreciate that uh pursuant to committee rules 8C all members who wish to insert written statements into the record may do so by submitting them to the committee clerk electronically in Microsoft Word formatted by 5:00 p.m. 14 days after this hearing which is December 26 2024 and without objections the hearing record will remain open for 14 days to allow such statements and other material referen during this hearing to be submitted for the oral of official hearing record um I note for the subcommittee that some of my colleagues who are not permanent members of the subcommittee may be wavering on for the purpose of today's hearing I will now turn to the introduction of our two distinguished guests uh the first witness is The Honorable Michael D Smith who is the Chief Executive Officer of am corpse who located in uh Washington DC Miss SM Miss Smith is the eighth CEO of mar corpse he was nominated by President Biden uh in June 2021 and confirmed by the US Senate in December 2021 prior to that he served as executive director of my brothers Keepers Alliance and director of Youth Opportunity programs at the Obama Foundation the second witness is Mr Steven Ravis who is the acting Inspector General of American corpse in Washington DC Mr Ravis is America Corps acting Inspector General a role he assumed May 20 23 Mr ravas has more than 10 years of experience in the Inspector General uh Community including at America Corps as acting director uh Inspector General as counselor to the Inspector General um we thank the witness for being here today and look forward to your testimony pursuant to community rules I would ask that you each limit your oral representation to 5 minute summary of your written statement i' also like to remind the witnesses to be aware of the responsib Poss ility to provide accurate information to the subcommittee I will first recognize Mr Smith thank you uh chairwoman Fox uh chairman Owens ranking members Scott and Wilson uh and members of the subcommittee I want to thank you for the opportunity to testify today americ cor's mission of improving the lives of Americans through service is personal to me I was raised by parents who were just 16 years old when I was born uh we didn't have much money but we had love and abundance and we had a community who believed in an idea that our neighbors children are all of our children my mom sent me to my local Boys and Girls Club because she told me that she needed inexpensive daycare but she got so much more there I met my first americore foster grandparents and Vista members who alongside other caring adults Lifted Me Up and kept me in line there is no way that a kid like me could go from relying on welfare to Leading a federal agency had it not been for everyday Americans who made service their life work Americans like the 200,000 americore members and americore seniors volunteers who show up for their neighbors and need in every state in every one of your districts every single day they represent America at its very best that's why important that's why investment in sound financial management and internal controls is so important americor cannot deliver on our mission if our foundation is not stable when I became CEO just 3 years ago americore faced significant financial management challenges stemming from Decades of underinvestment in Systems Operations and people resulting in five years of disclaimed audit opinions prior to my arrival I outlined a plan for this committee two years ago to put americor on a path to financial and operational success we are now implementing that multi-year plan and it is working we downgraded one material weakness we closed osed one significant deficiency and one former material weakness we remediated an audit non-compliance and closed more than 25 financial statement audit recommendations we have made historic investments in technology modernization and financial systems and we've bolstered our expertise including the agency's first ever senior adviser on financial reform who is joining me today we completed nearly 100% of remediation activities for five targeted material weaknesses which should be reflected in next Year's audit and we closed nine of 10 GAO audit recommendations to ensure Amor's fraud risk management practices more fully aligned with their leading practices as we rebuild the agency's operational infrastructure americore continues to do what we do best mobilize millions of Americans to strengthen communities and improve lives for every $1 invested in americore more than $17 are returned to the taxpayer we see see that return every day we see it in an americore member in Virginia recovery Corps who survived substance abuse she told me that americore was the only door that opened when all other doors closed we see it in the power Corp PHL americore member in Philadelphia who shared that he was once on a path from the school to prison pipeline or worse but americore saved his life and we see it in the nearly 1,000 americore members who have supported recovery from hurricanes Helen and Milton in Florida North Carolina and across the southeast one Asheville North Carolina resident whose father's home was flooded wrote to us and said the americore team under promised and overd delivered at every step this group gave us more than relief they gave us hope as a maricor drives tangible Community impact around our country we remain committed to strengthening the foundation of our mission with continued support from Congress and in collaboration with our Inspector General americor will achieve a clean audit opinion in 2026 and our members and our volunteers will continue to create hope and opportunity everywhere they serve I thank you for the opportunity to testify and I look forward to answering your questions thank you so much and I now recognize Mr ravas Sheriff Fox and Owens uh ranking members Scott and Wilson and members of the subcommittee thank you for the opportunity to testify today about the work of the office of of Inspector General I've had the privilege of serving as the acting Inspector General since May of 2023 and I've served within this oig for more than five years my testimony today focuses on the top challenges facing americore there are three things that I hope you take away from this testimony first work is being done to improve financial management a fiscal year 2025 will be an important year second we would like to see the agency do more to hold granes accountable especially in the area of time card fraud and third the agency's modernization initiative is is important and necessary but better project management is required to avoid further significant cost overruns our oversight work demonstrates that improving financial management is the agency's top challenge americore still needs the appropriate people processes and systems for its success the oig conducts annual audits of americor financial statements which answer the question of whether the agency is handling its money appropriately in fiscal year 2024 America could not demonstrate that its financial statements accurately and fairly presented the agency's financial condition for the eth consecutive year the Auditors have therefore issued a disclaimer of opinion our fiscal year 2024 audit identifies 11 material weaknesses eight of these have been knowned to the agency since our fiscal year 2017 and 2018 audits America's lack of processes and internal controls over financial reporting led to a negative 62 million national service Serv trust fund balance with treasury at year end in addition a mar cor's own assessment of its internal controls determined that its internal control program had only one out of 17 GAO internal control principles functioning effectively am Corp has long-standing open recommendations related to operational and financial aspects of its Grant processes a key area for this grant making agency while significant work Remains the agency took some positive steps in fiscal year 2024 and maror has prioritized Financial reform and is indicated it remediated four material weaknesses as of the end of fiscal year 2024 while the agency has not yet implemented this work we look forward to testing and validating it in fiscal year 2025 this plus the 20 recommendations closed from prior years during this year's audit are promising steps the support and dedication of a new administration's leadership team to continue these efforts will be critical to the agency's progress the second top challenge of facing Amer cor is preventing and detecting fraud in its programs Grant fraud deprives deserving beneficiaries of essential funding and arose the public trust in national service programs time sheet fraud is prevalent in many americor programs a significant amount of americore funds are tied to hours served when those hours are inflated or misrepresented americore funds are expended that should not have been issued one recent audit found that a large grantee and its sub grantees failed to comply with Federal and AER court timekeeping with a monetary impact of over 6.6 million the sub grantees lack document ation supporting the members actual service hours performed in Amir cor programs and other activities the agency has declined to disallow over $3 million in education Awards related to service hours that lack appropriate documentation the agency initially agreed to claw back $3 million in Grant funds given to the subgrantee with a non-compliant americore program however conversations with the agency within the last few days seem to indicate that that decision to Calla back these funds is not yet final also problematic is the agency's decision to change its terms and conditions to dial back accountability by removing the long-standing requirement that grantees record all hours served by members regardless of the funding source this decision eliminates the only way for mayor Corp and the oig to verify that the hours build uh were not also build to another Federal Grant or funding source since I submitted my written testimony the agency has engaged with us again on this topic and its initial proposal is a step forward we have continued to have frequent dialogue with a core on the importance of holding granes accountable and I'm encouraged by a core's recent decision to call back over $560,000 from a large municipality third and finally a mar course faces significant challenges modernizing its information technology the agency relies on outdated Legacy systems and manual stop Gap measures to carry out key operations recently we issued a management alert informing the agency that the cost to develop and maintain a new grants management system will likely exceed 188 million more than doubled the original contract amount due to a number of missteps we are still looking at this issue and our suggested actions focus on making improvements to us Contracting process and oversight of major contracts to avoid this issue in the future improving financial management preventing detecting fraud and modernizing it are the agency's top challenges in particular Financial reform is the lynchpin of americore success we look forward to testing items the agency asserts it has REM remediated in fiscal year 2025 audit I'd be pleased to answer the committee's questions thank you so much for that uh under committee rule 9ine we will now question Witnesses under five minute rule I will begin the process um Mr ravas first of all I want to thank you for how well you've communicated with our committee uh being very proactive uh this is a very necessary process and uh to to get get this uh this this whole process resolved so uh Mr ravas in November uh 20123 the Inspector General reported that America Corps developed a new anti fraud course but did not require grantees to take it uh is that correct yes sir that's correct okay I understand that this year was the first year Amer implemented any sort any implemented any sort of fraud education requirement however is is it correct that only a single staff member per Grant is required to participate um and that only applies to some programs not all that's correct it's just a single staff member in each grantee and I believe it doesn't apply to Vista and RSVP programs right now however I will say that um the agency uh this is the only open a recommendation from the gao's recent audit and the agency I believe plans to implement uh fully Implement that recommendation in 2025 uh my concern I guess is it's taken seven years to even come to this point right it's it's been quite a few years in which this has been happening and we have not been able to kind of get to the source am I correct on that yes I agree with you uh Mr May am Corps has not passed an audit since uh 2017 do you believe am corpse is focusing his time and resources on showing that it can handle taxpayer funds responsibly thank you Mr chairman I absolutely do and I think if you looked at the inspector General's testimony our former Inspector General uh they will tell you they've never seen a leadership team that has made the kind of commitment that we've made uh today and that's why we're seeing some of the results that I reported on in my opening remarks okay uh two years ago America was proudly announced is first ever hiring of a chief diversity and inclusive officer in your 2024 annual report goal number one of America is to advance racial equ Equity uh Mr Smith does uh America prioritize guarantees who claim to address racial Equity I'm sorry Mr chairman can you repeat the last part of that question does America prioritize guarantees who claim to address ra racial equities is that a part of this of the requirement am Corp does value uh grantees that believe in in equity okay um your annual report also St sets a goal that 80% of americ corp's employees would agree or strongly agree that Dei is integrated into the agency is that correct I would have to double check the record but I I believe so okay how does indoctrinating employees on Dei and integrating into grants help address the waste and fraud that we've been seeing all this time and the lack of being able to even have a an audit to take care of Mr chairman thank you for the question uh we're proud of the work that we've done on diversity equity and inclusion uh so many of our americore staff or americore members themselves worked as teachers worked in the social sector and so the priorities for diversity Equity inclusion and accessibility at Amore is making sure that everyone no matter where they come from has the opportunity to take part in this transformative work and so we want to make sure that we reduce any barriers to service I am proud for instance that 30% of our funding goes to rural grantees I need to know that there might be a reason that a member of a rural community isn't showing up because they have Broadband issues I need to know that a member of our tribal Community that's remote might have a challenge with our fingerprinting requirements because they have to cross a frozen win uh River in order like a scam and Bay granty that I saw in order to get to one of our fingerprinting centers I need to know are we kind of conflating what Dei really means that at the end of the day Dei is how we look is our background has nothing to do with Merit and Merit is really I think what we're missing in terms of getting this program taken care of we need the best talent right would you agree with that Mr chairman I age best thers the best innovator innovators the best people can sit down and add so I'm I'm having a problem with seeing how Dei has anything to do with any of that Mr chairman the way we look about it is making sure there are no barriers to service for anyone uh and that no matter what community that you come from you have an opportunity to serve uh and that's that's why we spend so much time thinking about diversity Equity inclusion and accessibility well it should be about return of investment and obviously we we're failing in that area um eight straight audits uh I think America Co spends his time and energy on di staff to spread divisive ideology which it does instead of this instead of the focusing on the taxpayer funds uh I think American public deserves better I think we should be looking at meritocracy how to get this taken care of the fact is there's a lot of money being wasted a lot of fraud not being able to be found it's because we don't have the right Talent the right mindset to to take care of that uh it is at time to to address this very wasteful program so with that I'd like to um yield to uh the my ranking member thank you Mr chair Mr ravas in the uh FY 2024 audit the agency's external Auditors noted the agency's progress closing 20 out of 95 recommendations from the FY 2022 report while three new recommendations have been added leading to 78 outstanding recommendations it seems America is finally making some real progress do you agree with that characteristic and can you expound on that progress sure happy to yes I agree that AER Corp is making progress as I mentioned Mar's uh indicated that it has um remediated for material weaknesses we have not been able to test those yet we'll be testing them in 2025 once they're implemented but you're right they have closed 20 uh they closed 20 recommendations they added three that's compared to fiscal 2023 where they only close seven and we added over 20 okay ranking um Mr Smith Amica cor funds over 3,300 projects with over 200,000 volunteers serving communities ACC Across the Nation can you tell us how vital Amero is to our country and how impactful the work volunteers and members do congresswoman thank you so much uh for that question I tell people I have the best job in the federal government all the time and it's because I really get to see America at its best uh it's people coming together uniting across differences from all different parts of our country uh really showing that when the going gets tough America gets tougher uh and Americans want to unite uh whether that's after a hurricane a fire or a flood helping their neighbors in need uh whether that is working on Coastal erosion whether that's helping uh our kids uh addressing the Gap in teachers that we have whether it's our Public Health Workforce uh and really addressing that through programs like P public health americore uh so today uh as I mentioned earlier we have about 200,000 americor members and americor Senior volunteers that are serving in 40,000 locations uh that's in our Boys and Girls Clubs that's in our Salvation armies that's in our American red crosses and if they were here talking to you they would say that americore members are vital for them to be able to do their operational work because americore members bring Force multiplication uh and more muscle and when I think about americore I think about a triple bottom line I think about the impact that it has on our communities I think about the impact that it has on the members 75% of whom by the way end up staying in the broader social sectors they go from being an americore tutor or mentor to becoming a teacher uh and I think about it from societal benefits when you have a more a less isolated Society more social cohesion more Civic engagement After People serve their country okay um Can Can you discuss diversity within americore volunteers and how are these volunteers recruited uh thank you so much one I would say I I am proud of the fact that americor is decentralized we are not a big bloated Washington program uh most of our americore state and National dollars go through our governor appointed State Service Commission uh Mr chairman I was recently with the governor and Mrs Cox in Utah where they launched the one Utah service Fellowship extraordinary program that's helping folks uh serve while they're uh finishing their their schooling uh and so those State commissions help to make a lot of decisions on where the dollars are going and then we have a network of thousands of of grantees to make sure that Michael Smith in Washington isn't deciding what's needed in Florida or what's needed in Utah to make sure that the people the force multipliers that are Amore members are really being directed to local challenges I'm also now proud to report that americore looks like America uh it is more ethnically diversed or as ethnically diverse than the country 40% of americore members come from low-income households uh as I mentioned earlier 30% come from rural communities uh and so we see that because this is really a groundup and not a top- down program uh Mr Smith in uh Miami Dade County we have uh a mirica called volunteers and in some of our most challenged neighborhoods and challenged schools and most of those schools are I guess I guess we could say 90% African-American um how do we make sure that those schools are serviced by African-American volunteers because presently they're not congresswoman thank you for that question I would say one there there are no quotas for americore service one of the things that I am proud of though is that more and more americore members are coming from the communities where they're serving and that is wonderful uh so that they can see an opportunity to serve in their own communities and they they have they understand the the trials and challenges that are that their students have gone through the other beautiful thing about americore though is it brings people together there might be someone from Utah or North Carolina that is coming to serve alongside uh folks in in Overtown or throughout Miami Dade and that is a beautiful way that America americore brings uh folks together back thank you I'd like to recognize my colleague from Virginia Mr good thank you Mr chairman thank you to our Witnesses thank you Mr Smith for being back here again with us uh the mar course is an example of yet one other instance where there is no constitutional justification for the federal government be confiscating taxpayer race sources and applying it in the most inefficient excuse me unproductive way possible that's another just another example of money we don't have doing something that we shouldn't be doing with forc confiscation of federal tax dollars Mr Ravis thanks for being here in your testimony you mentioned that the national service trust fund had a negative $62 million balance at the end of the fiscal year due to an inability to apply understand and apply basic accounting practices in March of this year just some eight nine months ago Congress passed a recision of Appropriations to the trust fund as you know that is this trust fund that's managed by Amour but 6 months later the recision had not yet happened uh but an americore rep from the trust fund office reviewed the account with Department of Treasury and still authorized a major major purchase of federal Securities that purchase was on September 26 just 75 or so days ago or six months after the recession recision rather but a few days later the funds the law required to be resented were finally taken back leaving the account with the $62 million negative balance on September 30 sir How can a Federal agency spend money that Congress didn't give it thank you for the question we are still looking into this uh we only found out about this at the end of October what we can tell you is only what the agency has told us at this point and that is that there was a negative fund uh balance in the trust at the end of fiscal year 2020 uh 2024 but our initial assessment is that this is um a result of the lack of internal controls uh for financial management so what level of confidence would you have that the supposed reforms that have been talked about here today will be will work as they're intended well this area uh financial reporting is one of the areas the agency indicated uh where they have remediated their uh the material weakness they just have not yet implemented it so uh time will tell hopefully in 2025 for the 2025 audit whether it um this might be the audit this might be the one is that's what you're saying Perhaps Perhaps yeah Hope Springs Eternal I guess Mr Smith you didn't mention this in your testimony but the negative number in the account indicates there was a likely violation of the anti-deficiency ACT which as you know prohibits an agency from spending more money than Congress appropriates why should we conclude anything other than the fact that this violated that the trust violated the anti-deficiency ACT Mr good thank you for your question our office of general counsel just completed a review of this Challenge and found that there was no Ada violation uh let me let me explain so our national service Trust is the do okay so you're saying there is there wasn't a legal violation but at a minimum this is horrible management of taxpayer funds when would there be any accountability for the representative from americor in the national service trust who facilitated this negative $62 million balance will there be any accountability through uh through what for what had took place there is accountability there was always more than a billion dollars in our national service trust account there was one sub account for two and a half days that had a negative balance but we were never in a position of not having enough money in order to pay our national service trust obligations well I appreciate your testimony but do you think there should be any limit and and Mr Ravis mentioned the next audit should there be any limit on how many audits that americore can fail before Congress eliminates the funding Mr good I can't speak to what happened before I came here but I you've had how many since you've got there how many failed audits since you've been there so there were five years of failed disclaimed a how many came and we've had three and we've made historic inv about one's a concern two is a real I mean three is a when does it become a real problem under your watch or when does it indicate that americor is beyond salvation if you will Mr good I would say every single day a amicor is delivering for the American people in extraordinary ways I would also say uh sitting with me today is Erv Dennis who is our senior adviser for financial reform who was the CFO under secretary Carson who turned around HUD who had significantly more issues uh it took HUD four to five years in order hey they failed even worse than americor is what you're saying their failure was even worse is that what you're saying exponentially more and Irv turned them around literally wrote the book on how it done which is why I hired him to help us and we now it seems basic and fundamental excuse me that you we wouldn't keep giving money to an organization that continues to fail audits you would only do this in the federal government you wouldn't do this with a charitable organization you wouldn't keep giving it money but this is borrowed money from the taxpayers we don't have the money every dollar that's borrowed and spent by the federal government is either a increased tax on the on the citizens or it's greater inflation that everybody's been suffering under because of this overspending or it's increased debt that jeopardizes our future and it's hurting the American people and there's no constitutional justification for it and I yield back Mr chairman thank you I'd like to uh recognize my colleague from California Mr Koo thank you uh thank you Mr chairman um I'm aware that americ or's commitment to improving accountability has included taking on new support roles and responsibilities including new security and Report requirements mandated by Congress Mr Smith does the agency have enough staff to achieve oversight and accountability goals we do but in order to make sure we get to a clean audit opinion by 2026 we will continue to need to make an investment in this work and that was part of the reason uh why I believe we ended up with this challenge because there was not enough investment but right now we do uh which is also why the president's budget request next year for $10 million uh to support the four plan is so vitally important um I want to give you a chance to kind of uh complete your answer so people can clearly the previous questioner asked you about uh audits under your uh under your tenure uh can you say more about that thank thank you for the opportunity as I said there were five years of disclaimed audit opinions before I showed up and when I came in what we saw was years of a lack of investment and Systems Operations and people technology updates that weren't being made training that wasn't taking in place processes that weren't being put in place meanwhile americore was delivering for the American people but what we did is we said you know what this can't be a one-off we need to have an agency-wide cross- departmental plan we need to invest in leadership uh Irv my senior adviser he talks about the idea of having three ifs if you have leadership if you have investment and if you have accountability and those were the things we put in place that are anchored into our financial and operational reform plan which now has us on a path to have a clean audit by 26 we didn't get here overnight we're not going to get out of it overnight but finally uh you are seeing the results you're seeing the results in more than 15 audit recommendations that have been cleaned up the downgraded material weakness a closed material weakness uh in a relatively short amount of time uh since I was here to talk to the committee two years ago so bottom line under your short tenure uh you've had improved audits that's right and I believe the Inspector General would agree with that as would his previous uh colleague Miss Jeff um how does the annually report annually appropriated budget for Maric cor compared to other small agencies with similar responsibilities uh thank you for that question uh we well above our weight uh we're a relatively small Federal agency with a very small salary and expenditure footprint uh we spend about 3 to 5% on salaries and expenditures compared to around 12 to 14% of other federal agencies so of the 1.3 billion uh that's allocated to americor more than $800 million goes directly out to our grantees uh we have a relatively small staff footprint and as I said in my opening statement uh Studies have shown that for every one Federal dollar that's spent we see $17 back that's because our Amore members punch above their weight uh there's matching requirements and we see investment from the private sector from state governments and from local governments as well to match uh the federal investment thank you so much Mr Smith Miss brais uh in the past two audits the agency discusses steps taken to enhance fraud prevention detection uh response and response strategies can you tell us about the measures the agency has implemented to detect and prevent fraud and how successful have they been I I I'll leave it to to Mr Smith to to talk about uh the steps that they've implemented but what I can tell you is this um our work shows that the steps they've taken to prevent and detect um fraud is not enough and I think that's why it remains a a top management challenge okay uh is the how is the agency cooperating with the office of Inspector General your office to identify leading practices uh in anti fraud measures and implementing them the the agency has been very open uh to our uh suggestions and we provide briefings and training on our work that they have uh they have welcomed and I think that has helped shift the mindset um of the agency in terms of uh what fraud prevention means so you see a willingness and eagerness to uh to to your suggestions and uh and therefore you are observing perhaps a change in in culture at the agency with regard to these issues that's correct sir um uh I want to touch on the most one of the most critical elements of americore volunteer programs which is the investment in higher education uh Riverside community colleges my in my own district has been a direct beneficiary of americor Amor's financial and programmatic support Through The Californians for all college core eligible students earn up to $10,000 pay for their ancillary expenses which opens the doors for students who need to uh need a way to pay for their education and want to serve their community at the same time I understand that a similar program for americ cor program members the seagull Awards is one of the best recruitment tools that americ cor has at its disposal Mr Smith I'm running out of time for you to be able to expound on that maybe another member will ask you about the seagull Awards but I thank you both for your test morning today and I yeld back thank you thank you I'd like to now recognize my colleague from um it's m Mr grth thank you uh Mr Ravis a second ago you mentioned the phrase time card fraud never I don't know I've heard that phrase before you want to elaborate on that sure in this in this instance I'm referring to time and attendance fraud essentially um members uh members time uh in order to earn a Seagal education award a member has to serve a certain threshold amount of time time once they earn that time and it's certified the member would then uh earn the education award to be dispersed later uh to the uh institution of their choosing in terms of fraud we are seeing um in some programs where the programs are not monitoring the actual amount served and the time on those uh time cards is not correct and therefore individuals are earning education Awards when they shouldn't okay so the PE people committing fraud are the you call they they call them volunteers a second ago I'll beg rest for a second when you use the phrase volunteers these people are all getting paid aren't they are usually paid so in this instance I was using the term member uh that's on the Amore side they are receive living allowances and can earn education award I'm not aware that they are uh paid a salary okay well come coming back to time card fraud you're saying the the volunteers or whatever are claiming they're putting in more hours than they are in some cases yeah I I think this is less about the members and more about the grantee organizations and the oh the whole organizations are committing fraud uh what they're doing is uh they are not paying attention to the time or trying to inflate the time in order for them to earn their education award okay um next question uh most people who work for uh americore are they paid or are they what we call volunteers or how how taxwise does that work I I can't speak to the the numbers I think Mr Smith would have have a better idea of that but there are certainly a large number of members and volunteers okay Mr Smith you want to thank you Congressman I mentioned there are 200,000 americore members and americore Senior volunteers around 60,000 are americore members that work up to 1,700 hours a week and they receive a living allowance to pay for housing and food the vast majority of our folks are maricor senior volunteers more than 100,000 uh that are part of our retired senior volunteers program that do everything from Meals on Wheels to tax prep uh and and they are uh volunteers okay uh give you a general question here I was always under the impression that one of the goals of Amore is to provide some work experience for people right now America has a labor shortage and I would think if I'm an employer to a certain extent because the negative publicity of America or but also because you're really not in a uh an organization that has to accomplish something or make a customer happy that I would under normal circumstances much more likely to hire somebody who say worked for McDonald's which is kind of a high pressure job those guys really work hard I know our president de be recently discovered that um well I I would have you know um given that do you feel if somebody in the private sector used was looking at two people someone uh like I said in McDonald's somebody in americore where you know the audits kind of show things are kind of Loosey Goosey uh don't you feel that the people in the private sector would have a leg up if you were hiring somebody thank you for that question the private sector loves americor in fact we have about 600 employers uh that take part in our employers of national service program uh because they want people that are passionate ated who learned how to uh sometimes spend uh gold with straw uh and do extraordinary work Under Pressure being giving projects to get things done in communities and so that's why more than 600 employers have prioritized a maricor members in their application process employers like deot for instance uh that have worked with our maror grante city year for for many many years um Amor has failed an audit for eight consecutive years two years ago he told this committee that a clean audit would take several years two years later it's hard to see much progress can you give us a specific year in which you expect a mayor Corp to receive a clean audit thank you sir our financial and operational reform plan has us at a clean audit opinion in 2026 okay so about two years from now okay um one more question for this for Mr Ravis I understand the Auditors found 11 material weaknesses in americor eight of which have existed since 2018 can you rattle off what these these weaknesses are uh uh the major ones I can rattle off the major ones which are financial reporting um internal control environment and the trust obl obligations and liabilities okay thank you thank you I'd like now to recognize my colleague from Georgia Miss McBeth uh thank you chair Owens and thank you ranking member Wilson uh and thank you to our witnesses that are here with us today it's good to see you again Mr Smith um I truly understand the gravity of another failed audit as we all do and how important it is that these issues be addressed which it appears you have taken extens extensive time and energy to do so but I also understand the very critical role that americore and community service play in Americans everyday lives and I know that uh coming from Georgia and all of the problems that we've had with natural disasters lately I know what that means for us in Georgia whether it's cleaning up after a disaster ensuring that there are enough teachers in our poest schools or helping to provide a smooth transition into adulthood for foster youth Amore programs change lives for the better and encourage service to our greater Community maricor embodies the spirit of American volunteerism and puts folks face to face with some of our nation's most poignant questions like what can or should I be doing to give back to our country that has given us so very much asking not what uh your country can do for you but basically what can you do for your country and for those that live among you now I share the Deep concerns that everyone has about the financial state of americore and we've been talking about that extensively but I disagree with the misguided and the polit politically motivated push to dismantle this really really important program a program authorized under a Republican president that has long been a target of certain extreme conservatives who simply don't believe that it should exist at all over the past few months backto back hurricanes Helen and Milton have devastated the southeast and my home state of Georgia killing over 250 people across the South and causing hundreds of billions of Dollar in damage in the Carolinas Florida Tennessee and Virginia as members here unfortunately know from their own districts entire towns were destroyed and left totally inaccessible since then almost 1,000 americore members have been deployed and many more as you have mentioned to help support folks in their time of need and help them to rebuild their homes their businesses and just really rebuild their entire lives Mr Smith my question is for you is that can you succinctly tell me specifically for Georgia I'm really interested how many marac cor members are assisting in the storm cleanup efforts now and can you talk about where they are and the type of work that they're specifically doing on the ground congresswoman thank you so much it's good to see you I don't have the specific number for Amore members that are working on Disaster Response in Georgia I tell you that we've had more than a thousand that are throughout the southeast that have been working in a variety of ways uh one of the ways they provide disaster Survivor assistance uh so making sure that folks that are dealing with horrific uh challenges know where to go to get the resources uh to begin to rebuild their lives they're actually mucking and gutting houses they're doing mold remediation they're they're helping with rebuilding uh we also have uh folks that are managing uh various donations uh that are coming in and we have our FEMA Corp program where for the past 12 Years a FEMA has had their own americore teams which they're teaching emergency management skills and that they're embedded within them uh so that they're doing a variety of service not only responding to Residents With Disaster Survivor assistance but consolidating information doing mapping and helping to support uh FEMA staff well thank you for that and I do want to emphasize that these are the types of programs that we're talking about when we discuss the important work of Aer cor these are the programs that are going to be cut the communities and the people that will be further Left Behind if we work to dismantle these programs instead of making good faith efforts to fix these programs to fix the issues are at hand and as you're hearing today in Full Faith effort the americ Corp Representatives that sit before us today are doing that very thing thank you for being here today and I look forward to doing what I can to give you and americore the appropriate resources to continue the good progress and improving upon the financial situation that you inherited in uh 2021 as the incoming CEO uh instead of dismantling programs that bring us together by encouraging volunteerism and Civic engagement we should be taking steps to improve them and with that I yield back the balance of my time thank thank you so much I'd like now to yield to my colleague from Pennsylvania Mr Thompson thank you chairman um smth um you know thank you for the work that you've been doing uh you came in at a very difficult time I was here when you were before the committee two years ago and quite frankly you've kept the promises that you honestly shared there would be no immediate um uh really reconciling but it' be a matter of progress and I'll come back to that you know as a my own myself personally as an eagle scout scoutm and co-chair of the Congressional service organization caucus and uh the Congressional scouting caucus I'm keenly Ware the vast benefits and value of service to our country fact the 2017 gallopo shows that nearly half of Americans favor some type of mandatory national service post high school they see a value in that uh maricor has a worthy mission to prepare students for modern jobs support neighborhoods on the road to economic recovery and promote health and well-being among others I believe it also has a um a key role that needs to be more clearly articulated in the leadership ship development and the preparation to be uh to to you know to to be just a a serving citizen um post experience of Amic cor um and I'd like to see more data on that actually tracking uh where where these americore participants are in the future what are they doing what that is the true return on investment um that is I mean there's a lot of rois you could look at but that is probably the most important with the biggest payback going forward uh I've been a supporter of mar cor's vision and I've seen firsthand rewarding work that's made possible through these programs like the Keystone Smiles uh program in my district um benefits to uh you know to to help reduce those who are living in poverty uh to the community and Community good economic activity um uh to the you know personal and leadership development of the participants unfortunately uh uh maror uh uh has uh cannot accomplish these goals or fulfill its Mission totally if it continues to miss you taxpayer dollars and I know that two years ago you were very clear it would take three to five years to complete this turnaround um and so I don't know why any member of this body would be surprised that you know uh that it's not completely remediated at this point you were upfront and insightful at that point um and I appreciate that kind of honesty that's what I expect when folks come before the committee uh but I appreciate the progress that's being made I look forward to um as you said I think 2025 where we would see kind of a clean bill of health uh in terms of how at the was at the national level Mar cor has operated um I share several of the concerns my colleagues have already expressed with the organization's most recent failed audit and want to address some of these issues um and so this question is for Mr U ravas I've always said that education passway to opportunity and as you know amicor sets aside funds to pay education awards for members who successfully complete their programs um my understanding is maror estimates the education Awards to be U $287 million were independent Auditors able to verify that that number is correct I'm not sure the answer to that question I'd have to check with my team and get back to you or your staff after the test sure I appreciate it U you can have them get get back to me I very much appreciate it um and so we don't so you're not you don't know where the Auditors were uh whether that's been verified or not I'd love to know if it if it wasn't correct U if the uh why the were Auditors unable to verify this as well uh Mr Smith this is a crucial piece of information one that's critical to carrying out AER cor's mission to help educate uh students Nationwide do you agree that Mar cor needs to provide to Congress and the public that it can provide the payments uh that its programs promise I absolutely agree sir one of the other challenges I see with a marp is the lack of transparency in reporting on what happens with youth following their participation in the program as you likely know uh most other federal education programs track student progress following their completion sometimes long term um I'm particularly concerned about this since it makes a ult to assess for example credentials or hard skills that Amer cor participants uh uh that I believe they they they receive but if we're not tracking it we're not reporting it um you know uh and these are important because what they may earn a program prepares them for a 21st century economy um existing return on investment analysis from americ or fails to assess the entire program instead of cherry-picking programs across the country leaving critical gaps in both you your and our understanding of the program success and so I just uh would ask that um you know I look forward to following up and see because of my time what what changes you plan to make in AER cor to ensure students are obtaining the skills hard and soft skills necessary to succeed in today's economy and how am cor is tracking and communicating that progress chairman thanks so much thank you so much I'd like now to recognize my colleague from Virginia Mr Scot thank you Mr Mr chairman um Mr Smith right now there are 149 americore members and americore seniors volunteering with nonprofit faith and community- based organizations across Virginia including literacy Labs Virginia reading Corps Habitat for Humanity Peninsula and greater Williamsburg and the Hampton Roads Workforce Foundation um I consider the work of americ Corp across this country as vital work to strengthen the Civic engagement M and provide a sense of community is the work in Virginia representative of the work being done across the country Mr chairman thank you for that question uh it it absolutely is it's hyperlocal it's being responsive to local needs and Virginia I've had the opportunity to see everything from our americore members in schools to the americ cor members that you met uh that were building houses with Habitat for Humanity uh to americore members that were substance abuse survivors that are working in the Virginia recovery Corps and that's that's the beauty of americor it gets to be hyperresponsive to local needs um you recognize that the failure to produce a clean audit threatens these kinds of programs I do recognize that which is why I've taken it so seriously okay now about a year ago you were given a list of recommendations I think it was from the IG or GAO or the IG um where was The List come where did the list come from so Mr chairman I believe you're referring to uh the uh GAO recommendations related to fraud okay um what is the status of the recommendations thank you for that question so we've actually closed nine out of 10 of those recommendations to be more aligned with their leading practices and the 10th recommendation will be closed as well we're just waiting for our upcoming uh Grant terms and conditions to be released what I'm proud of Sir is the vast majority of those recommendations we were already working on before we even received uh the list from GAO now are there other problems that were not on that list I believe they did a good job of helping to identify some of the challenges that we had already begin begun to mitigate um so if you've solved all the problems why does it take two more years to get a clean audit uh thank you sir uh so I was specifically referring to the fraud recommendations that came from GAO um as you know uh there are many more recommendations uh related to the material weaknesses that we're facing with our audit challenges uh the various other recommendations we've closed more than 150 audit recommendations uh We've downgraded a downgraded a material weakness closed another material weakness we've made extraordinary progress on our fsma and cyber security standing we've closed some that were more than a decade old uh but there there are still more uh challenges that we have to work through um um did you request more staff or resources to get through that list uh yes we did the president's uh fy2 budget calls for an additional 20 uh $10 million to support the four plan and also an increase I believe to $126 million uh for $127 million for salaries and expenditures I'm proud that americor is lean that most of our money goes to our grantees uh but actually when I look at what led us to having some of these historic challenges is we just simply were not investing in Systems Operations and people and we have to turn that around and do you know the status of that appropriation we we look forward to hearing from from Congress well the budget's almost done do you know if it's in there I I do I do not know where the final numbers stand we are hopeful uh that we're going to get towards the president's budget request thank you Mr chairman are you back thank you thank you and I would like to recognize the full committee chair Dr Fox uh thank you Mr Owens um it feels like deja vu every time we discuss americor and its inability to accurately track its own finances Mr Revis a amicor has failed its audit for the eighth consecutive year is it correct to say that an Auditor's quote disclaimer of opinion means the accuracy of American course financial statements cannot be trusted that's correct ma'am Mr Ron your testimony you talked about americ cor's contract to upgrade its it systems I'm shocked to hear the cost of the contract has ballooned to over $18 million more than double the original contract before I ask about this contract is it correct that americor has already spent over 34 million on this issue in previous contracts my understanding is yes there was a $34 million write off uh back in 2018 have there been tangible results as a result of that $34 million expenditure I don't believe so can you explain why the cost for this contract has also exploded yet again costing American taxpayers millions of dollars yes we're still looking into this issue but our early assessment we've come up with three reasons the first is that the agency used a firm fixed price contract even though there were unknown requirements at the time of Contracting and despite its past experience that these types of contracts uh the cost can quickly rise the second issue was there was a lack of involvement of technical experts there was a technical expert on the contract management uh team from the office of Information Technology but that individual was a signed to another project and wasn't there for most of the the management and finally the contract was descoped the agency was not considering um how it was going to pay for the descoped uh descoped requirements you used a lot of words to describe incompetence that's exactly it boils down to one word incompetence Mr Smith you have a strange sense of Pride you are proud of some really unusual usual things um in your testimony you talked about americor supposed quote return on investment end quote in its programs given that americor hasn't known where its money is for the last eight years in counting I'm doubtful we know the true cost of americore programs at all did any of these americore studies compare americore to actions by the private sector using the same or fewer amount of funds Dr Fox uh thank you for your service it's a simple answer qu yes or no I'll have to go back and look to see what the comparisons were but I don't believe you can find a better return on investment than 17 to1 for the type of work that we do again you have a strange sense of what's good and not good I understand many of these americore studies were cherry-picked from different programs Across the Nation what seems more common to me are wasteful and fraudulent programs in recent years there have been multiple examples of americ or fraud including 1.7 million here in DC 2.1 million in Denver 2.5 million in San Francisco this year your own annual report with its un audited numbers estimated over40 million in improper payments in just two programs of course this is just the fraud we know of Mr Smith do you think fraudulent programs and improper payments provide a good Roi for taxpayer dollars absolutely not and there's no evidence to prove that americor sees any more fraud than any other Federal agency but there is evidence to show that we are doing something about it in the past eight years American taxpayers have given americore over eight billion do and gotten E Straight failed audits waste fraud and fraud in return it is the poster child for Waste Fraud and Abuse in the federal government the answer is certainly not more funding it's time to cut taxpayer losses and eliminate americor it can't come fast enough thank you Mr chairman I yield back thank you I'd like to now recognize my colleague from North Carolina Dr Adams thank you Mr chairman and thank you to our Witnesses for your testimony uh today uh Mr ravers what do you believe is a reasonable and and necessary timeline for the americo's team to implement the most impactful recommendations uh our view is that there's not one recommendation or material weakness that is a priority it's only when the agency implements all of the recommendations that they'll have sound financial management so what actions do you believe the agency will have to take immediately to be able to achieve this target well I think immediately they'll have they should be implementing the material weaknesses the form material weaknesses that they've already remediated uh so that we can uh test and validate them in our fiscal year 2025 audit so how has oig been working with the amicor to help achieve this timeline we uh myself I have frequent discussions with Mr Smith and his chief of staff on a bi-weekly basis where we talk about this and other matters and our our independent Auditors and our audit team here at americore oig have uh numerous meetings across each month uh to assess progress get documents and discuss issues thank you sir Mr Smith um I'd like to talk to you a bit about hurricane Helen and americo's role in supporting the long-term recovery of impacted communities for example while we might not see the immediate health effects of mold from house flooding and families uh families will be impacted by it for for years to come Amica members were in North Carolina in those first few critical days uh to the muck and and gut houses to prevent them from being overrun by with moles so could you speak more more about americo's holistic approach to to planning for both the immediate and the long-term impacts of natural disasters thank you uh congresswoman I am so proud of the work Amer courp does in Disaster Response I actually first came to know this agency after Hurricane Katrina in the decade after Hurricane Katrina we had 40,000 americore members that showed up to support people in Louisiana and Mississippi uh and I was actually just there this summer uh where many of those folks are still a part of the community so we are there in the immed imediate aftermath uh to do mucking and gutting uh we are there long after the cameras are gone when kids need to go back to schools and they need additional support uh and we are there for the long term to move from recovery to rebuilding uh to to resilience I'm also proud that we are ready to go uh so when a disaster strikes our Amore members know how to use saws they know how to do mold remediation they've been given uh certifications with industry standards and so we can deploy our members to be there and be effective uh when they're needed most okay so I I thank you for that I I've seen just how devastating hurricane Helen has been for North Carolinians as climate change worsens and natural disasters happen more frequently as a result our nation needs a Workforce that's train to prepare our country for these challenges uh the Biden Administration launched the americ War uh which recruits and trains volunteers to do climate resilience and mitigation uh activ activities this is model after the New Deal program the Civilian Conservation Corp which hired young unemployed men to work to protect and preserve public land so can you describe how this work is going and you can ALS can you also con confirm uh the authority that this program is under uh thank you so much congresswoman I I'll start there uh AER Corp has an authority and obligation uh to act on our statute which requires us to do environmental stewardship work uh and we also have the authority to enter into to inter agency Partnerships with every single Administration has done from Clinton to Trump and and now uh the American climate Corps was a program that allowed us to get a shot in the arm and to bring more energy and attention uh to the environmental stewardship work uh that we have been doing for a long time uh last year we had about 15,000 americore members that were working on fire M mitigation Coastal erosion and our public parks and public spaces uh we just launched a new program called the energy communities americore program which is helping folks uh that might be in communities affected by Brown sites or in coal mining communities transition into new jobs uh and so this has been wonderful to see the excitement and intention of young people to want to make a difference on conservation and climate issues while learning the skills that they need to get those jobs going forward okay let me ask you real quick um uh is it uh is it correct uh that the that ACC volunteers are being recruited under the authority of the NCCC uh Vista Vista and the state and National programs that's absolutely correct okay thank you very much Mr chair I you back thank you I'd like to now um recognize my colleague Mr Courtney here okay i' I'd like to recognize Mr sablin yes thank you very much uh Mr chairman and good morning gentlemen um this is a very important program to many Americans to my district to I'm from the Northern Mariana Islands you won't find it on the map Mr Smith but it is a good program um this is also my last hearing and uh I am I reinjured my back but I made it a point to come here to tell you that uh this is a good program but let me ask Mr robas Sir um you have this a disclaim audit um the disclaimer would be ar is that like qualified opinion what you say a qualified opinion in an audit a disclaimer is not a qualified opinion uh but there is such thing as a qualified opinion yes I'm aware of that yes so which is this is a this one is a disclaimer sir okay but you're working closely already trying to fix uh many of the weaknesses internal weaknesses right that that would be the problem right it would be in the internal weaknesses cuz if those um mechanisms those control work then uh things would be you know so they're working on it correct our role is to uh is to test their internal controls and they have uh their plan in which in which they're remediating uh processes and procedures so you said independent Auditors as well that would be an outside group that comes in and does independ do they issue a qualified opinion my understanding is they can issue a qualified opinion they can of course based on their license they have an obligation to issue a you know qualified opinion or no opinion actually uh do you are you aware if they have issued that that's not my understanding but I can check with them okay no no I'm just uh if if if it's not then uh yeah I mean we could work more with Mr Smith because that that that would be a problem and uh I wanted to thank you for your service sir um and uh wish you all well I thank you for thank thank you so much um like to recognize my colleague from Connecticut uh Mr Courtney thank you uh Mr chair and um uh actually I just walked in as uh my my colleague and good friend Mr sablan who we've served together for so many years on this uh committee announced that this is his final hearing and um again he has just been a pillar in a stalwart on this committee and um no but I mean really you've contributed so much and uh we're going to miss you and congratulations again an outstanding career and uh Mrs Fox is uh not here we know she's going to be around but uh obviously giving up the gavel is a big moment for her and um again want to salute her service um as chair for many years so uh again it's great to see you here again Mr Smith and uh I was uh again thinking about your trip to my district back in 2023 when the uh americore sponsored uh veterans Coffee House in Mystic Connecticut uh was having their monthly meeting and um again this is a a americore initiated uh initiative which uh again brings together veterans uh in a really super well welcoming and friendly environment um it it accomplishes in significant things though in terms of uh being a place where um new information from the VA military um is uh exchanged and and uh again coming this district is actually has the highest concentration of veterans second district of Connecticut and there's just no question that uh what americore does there has really um made a difference to to Veterans who were not aware of the fact that um there were programs and services available to them we had uh we've had um veterans who've you know connected to disability um uh eligibility and are getting now monthly checks uh for you know the service connected injuries that uh clearly entitled them to that help and really if it wasn't for these sort of networking connections that took place because of of uh basically a volunteer-driven um event uh you know it never would have happened that day you were and I were there you may recall it was a 99y old veteran Mr Neil Spain who was a World War II veteran he uh crossed over uh onto Normandy beach after the first wave and fought his way through the battle of the hedr in France uh and his unit was actually one of the first if not the first that entered Germany um amazing individual who's gone on to do you know great things um uh for the Navy after the war uh in electric boat Shipyard where um again he he was a top engineer and executive when the time came to convert our submarine Fleet to a nuclear powered um so anyway he's now like the you know regular at those meetings and again he uh his his wisdom and perspective he turned 100 uh last March and uh again it's you know again those kinds of things that I think show the value of what americor brings to the table so um you know one item I just wanted again and I've done this at other H past hearings is that the biggest agency in the federal government is the Department of Defense I sit on the house armed services committee I've been there for 18 years they have never passed an audit as a department never okay they've made some progress I was on the subcommittee on auditability a number of years ago which put into statute the fact that they have to hit a 2028 Target to to to accomplish that the Marine Corps has done it you know hurah uh but you know the other branches have not and I mean no one is suggesting that we terminate or scale back you know our our military service um you know but they're showing progress just like you are and and really that's the test that I think all of us should have as part of oversight which is to kind of keep our foot on you know the the process and keep it moving forward but to to not just sort of you know use some kind of um broad brush um sanctions or penalties which again eliminates what is as I said you know I've seen it myself the the value and return on investment that americore um provides so um again if if there's something we can do to help the process accelerate whether it's you know funding again some of these technical um you know uh upgrades that are needed I mean we we that to me is what we need to hear if we want to kind of keep the momentum moving forward I've only given you 23 seconds left but maybe you could just comment quickly it's good to see you again sir I would say what this agency will need as you as you know I I won't be here in a couple months uh we can't take our foot off the gas I'm proud of the work that we've done to turn around Decades of underinvestment it will take funding meeting the president's uh funding request it will take continued oversight I'm also so proud of the work that we do we have 15,000 veterans that serve in americore and we serve 2 45,000 veterans and military families I was actually just here with our four country caucus who believes that America is better when people are asked to serve whether it's overseas or here at home through americore programs thank you sir thank you I like recognize my um my colleague Miss bichi uh thank you Mr chairman I take our committee's oversight responsibility seriously as does every member on this committee and as others have pointed out America America has received numerous failed audits over the past several years and as with any federal agency we must hold the corporation for National and community service accountable uh for responsible use of taxpayer dollars I'm I'm encouraged by the recent efforts that Americar has made to rectify the identified deficiencies but we acknowledge that there's more work to be done well that being said I want to follow up on on uh representative Courtney's comments uh and highlight the value of americor programs at the state and local levels so in my home state of Oregon uh there are close to 2,000 members and volunteers who are serving in communities across the state here on the education committee and particularly on the subcommittee on higher education we talk about reducing the cost of higher education you look at the Seagal education Awards where people can put in community service and earn some dollars that help them pay for higher education uh and in Oregon we have Amir cor members and volunteers particularly a lot in the Amir cor seniors doing amazing in work with uh organizations we have college possible Northwest Youth Corps forest grow School District Mental Health Association of organs to name a few and more than a hundred Mayors sent us a letter in support of americore um so these are some of the individuals and organizations it would stand to lose the service that they're they're all benefiting from if as some members of this committee would like to do uh americore would be eliminated uh instead we should be not izing local communities and taking away those opportunities we should be looking at how we remedy uh the fault so Mr ravas the external auditor findings show that there are several areas in which americore and the national service trust can improve their financial management and internal control so which of these should be uh a priority for americore and why our view is that there's not one material weakness or recommendation that should be prioritized and in fact the agency's plan does not focus on material weaknesses it focuses on a more holistic approach from what I understand uh it's only when all the recommendations are implemented and we're able to um you know analyze those and test them that we can finally determine that they've achieved sound financial management I appreciate that so so Mr Smith thank you for your service at americore uh I'm glad to hear that americore is making progress and I'd like you to talk a little a little bit about the holistic approach um because there are several findings in the recent audits so which are you on target uh to meet for remediation within the next year and how long would you expect using this uh holistic approach it would take for all of the remediation actions to be fully implemented uh thank you congresswoman for that question uh so our financial and operational reform plan shows us getting to a clean audit opinion in 2026 uh what we have done as Mr Ravis uh pointed out as we focused on the whole uh there are internal controls that have to be fixed there are systems that have to be fixed there are processes that have to be fixed there is modernization and every single employee at americore needs to take ownership and every single department needs to take ownership and that's why you're seeing the results that you're seeing with over 150 recommendations closed uh one downgraded material weakness one closed material weakness incredible improvement in our fisma compliance that is because the holistic approach that we've taken and that is the approach uh that was taken at HUD that was able to see them turned around in four years and can you confidently say that you expect those that 2026 Target to be met I feel confident if we continue to make the level of investment uh if we get the president's budget request if the incoming Administration continues to support our Systems Operations and people uh and our financial and operational reform plan we will get to a clean audit by 2026 thank you uh Mr Smith and and I hope that next time a miror COR is is before for the committee we will see that progress and and Mr chairman as I yield back I would like to ask the committee to extend a welcome to my niece's daughter Miss Hannah flame who's in the she's seven and she's in the committee room today because she's here learning about the the US government thank you much welome thank you so much that's the way we pass our Legacy on I appreciate that um okay I'm sorry um i' like to recognize from North Carolina M Mr Manning thank you Mr chairman and thank you to our Witnesses for being here today um I know that we are we wish you could come back with a clean audit but that it's going to take as you said many many years to get to that point and we understand that but Mr ravas I do want to ask in September you put out a management alert that flagged cost overruns in the grant management software that americore has tried to implement for several years now and specifically you estimate that the contract is now uh $9 million double the original amount of the contract this is after americor spent $ 33.8 million on software that produced no final product do you have an update on how americore is addressing this management alert we're still looking into the matter uh but we passed along our suggestions as part of the management Al as soon as we uncovered the issue and our hope is that uh the agency will seriously consider those recommendations as they uh contract a manage future contracts including those for the grant management system and their member management system can you explain why the $ 33.8 million investment in software did not produce a final product that was a little before my time uh my understanding was that they just they couldn't end up with a a usable product at the end of the development phase and it took $33 million to realize that they weren't going to end up with a usable product that's my understanding but that was back in 2018 are there procedures in place to to um look at processes earlier so that we don't spend so much money before determining that a product just isn't going to reach fruition that's what we're looking into now uh as a result of this management alert and our hope is that there is okay well I I would hope that you reach that point sooner rather than later because we hate to waste taxpayer money on those kinds of things um that being said um I I would like to talk a little bit about the good work that americore does in a recent press release the chairwoman of this committee stated her desire to close americ cor's doors and tear down the agency Brick by Brick and while I I do believe as I just mentioned that americore needs to pursue fundamental changes in order to ensure that it's using public funds responsibly I want to highlight some of the work that this program is doing in my state of North Carolina particularly in the wake of hurricane Helen and Mr Smith do you know how many americor volunteers are actively serving in North Carolina is part of the Helen response so throughout the southeast we have about a thousand americore members that are working on uh Helen and Milton my understanding is that there are at least 130 americore workers in North Carolina um and do you know whether they are working in Ash County in wils county in Wataga County those counties sound familiar but I would need to double check with my team to make sure they're still there I would appreciate it if you could find out for us whether they were working in those counties and whether they are continuing to do work in those counties Ash County wils County Wago County those are all areas that were very hard hit by Hurricane Helen and caused severe damage can you tell us what the members are doing who are working in North Carolina on on Helen recovery thank you congresswoman there's a mix of uh services that Amer cor members provide after hurricanes uh is disaster Survivor assistance to make sure that survivors know how to get access to resources which can be absolutely overwhelming for folks then they do a lot of heavy lifting a lot of um mucking and gutting of houses uh mold remediation tearing down walls those sorts of things which they get done in record time and residents are always shocked that they're able to do it so quickly uh and then they work with our Federal Emergency Management agency uh to support uh response to make sure we're sending resources to the to the right places the volunteers that you get uh in americor do they come from any particular background or do they come from all different walks of life a maricor looks like America they're from rural communities inner city communities they're from tribal Nations uh every single race color creed and ideology and do you find that the people who come from all across America from all different backgrounds when they work together they build friendships and they build bonds of understanding I actually have data to back that up 80% of americ alumni say they are more comfortable working with with people from other differences 72% of americor Alum said they actually changed a belief system after their amicor service which I don't know when it's the last time that's happened for any of us well as you know we are living in a time of terrible partisan divide and so do you believe in addition to the Hands-On work that they do to help people who've been V victims of disaster do you believe that it's a good thing in this country for us to have a volunteer agency with Americas with Americans from all different backgrounds who can build bonds of friendship and learn to understand each other better it's absolutely right we've been focusing on bridging uh reversing polarization because the data shows there is something about ongoing sustained service that allows individuals to see each other's humanity and I have seen that across the country every day where people are coming together to make a difference in their own neighborhoods if nothing else in this time of acrimonious uh Behavior toward people from different backgrounds and different political parties I think that aspect of americord needs to be highlighted because I think it is so valuable and that is worth keeping in this country so with that I thank you and I yield back thank you so much for that and um thank you M Smith and Mr U Raves I appreciate your testimony uh I'd like to recognize Miss SMI Miss Williams for her closing remarks thank you chairman ens and thank you once again to our Witnesses for speaking with us today americore members and volunteers are critical resource for communities across the country neglecting or eliminating this longstanding institution would be a disservice not only to the oversight process but to the countless Americans that benefit from the work am Amic does in our communities to do this work properly americore requires aggressive and immediate reform to his existing Financial system I'm pleased to note that it wasn't until the current americore leadership appointed by the Biden Administration did the agency finally start taking these issues seriously and make the necessary actions needed to remediate them but much work remains to be done so it is our duty as a committee to step up and help them in their hour of need not threaten Draconian action against an organization whose ultimate goal is to Foster Civic engagement and positive change in our districts I look forward to working with Amer cor to reform and modernize its financial management so the agency can continue its invaluable work on behalf of all Americans thank you and I you back thank you M Wilson I appreciate that um let me just I guess start off with um probably the most important numbers I can give everybody today we're $37 trillion doll in debt um that's an amazing threat to our culture our future our kids and it's it's nice to have um programs that have a nice mission statement but the end of the day we need data and that's biggest concern we have issues where $40 million uh has been wasted fraud theft uh these this is real dollars from real people investing in our in our government thinking we're going to get a return on investment we don't get a returnal investment when people take $40 million in one one one uh deal um there's no consequence quences nobody goes to jail uh we find out years later that it happened these are kind of things we need to to to deal with uh it concerns me when the mission starts with a very good mission of bringing us together service that's a great concept that began decades ago we're now talking about Dei which we look at each other Inside Out versus outside in that's not bringing us together that does just the opposite um and there's no data the DI has had any positive impact on anything that that it's been part of so that messes up the the message of the theme of what this is all about we bring those type of of of uh ideologies into it my thought is is very simply we need to get back on Mission uh this country comes together when we serve uh sometimes that's the best is serving in a in a private market with the actual returnal investment $40 million into something else might have given us a better return we need to look at that that's what it comes down to it's not just feeling good it's getting the kind of data the type of things we need to get done here so uh I will say this has been helpful the fact that we're talking about this we now have another date I guess 20 one second okay we now have another date I would like to before we close up uh recognize um um my colleague leer Congressman lger Fernandez for a brief statement can we do that now thank you I truly appreciate that chairman and my apologies this uh this place calls us and pulls Us in so many different directions and so I will not be asking questions but I just wanted to make a statement about the value that americore brings to places like New Mexico brings to places where we have seen disasters whether that be in North Carolina or Florida or in my own beloved state of New Mexico where we had America on the ground after we suffered one of the largest the the historic largest fire in the United States which sadly was started by One Federal agency the forest department and yet we had other federal agencies coming to our help and Americar was there and it is something where we see Americar not just something great on paper it is something where you are on the ground and I want to uh remember something that one of my heroes spoke about uh and that is secretary John Gardner secretary John Gardner served in uh Johnson's cabinet he actually resigned because he was upset about the Vietnam War but before he resigned he helped Start Head Start he helped start so many programs and he always talked about the importance of becoming uh a loving critic of our federal agencies and his words were I pity the leader caught between unloving critics and uncritical lovers and what he was talking about is the importance that when you love something you must be willing to critique it to say you have done this can you do better we expect you to do better and so that's what I would say now to americor is we love the work you do we need to call upon our citizens to be better citizens to be part of something bigger than they are which America offers and so with that uh we love the work you do it is important for America is important for our students who need that help but we must also be loving critics and call upon you to write these errors so that we can continue investing and believing in the work you do and thank you so much absolutely thank you so much uh want to close out just by saying and thank you um it's all about return of Investments my friends return Investments we got to give the American people exactly what they're investing into and we cannot continue to say well it's just the way it is we have to get back to really being good steward of the money we're given so we're going to make sure we're we're talking about this holding everybody accountable um and uh with that i' like to again thank the witnesses for taking the time to test testify before the subcommittee today without objections uh there'll be no further business and the subcommittee stands OB jour e e e e for