STATEMENT OF CHARLES 0. PREJEAN, EXECUTIVE DIRECTOR FEDERATION OF SOUTHERN COOPERATIVES

Mr. PREJEAN. Mr. Chairman, my name is Charles Prejean. I am from southwest Louisiana. [Laughter.]

And I am the executive director of the Federation of Southern Cooperatives and if I were a wise person I think I would simply say amen to Mr. Freeman's presentation because I thought he did it well and very eloquently.

But I am not wise. [Laughter.]

I would like to talk a little about the Federation of Southern Co operatives, some of its general missions and more specifically about the VISTA national programs and the program that the Federation of Southern Cooperatives is administering, some of the specific activi ties that the VISTA volunteers were involved in last year, some of the accomplishments and some of the reasons why we support the VISTA State program and the VISTA national program.

The Federation of Southern Cooperatives is a service, resource, and advocacy association, for a constituency of 30,000 low-income families, organized into over 100 cooperatives and credit unions in rural communities across the South. Our membership is composed primarily of black low-income people, although we also include whites, Chicanos, and native Americans among our membership.

The federation was chartered in 1967, as an outgrowth of the Civil Rights Movement, by 22 low-income cooperatives then in existence. Over the past 12 years, we have grown to include over a hundred member cooperatives in 14 Southern States, stretching from the Rio Grande Valley in Texas to the eastern shore of Virginia.

In 1971 we established our headquarters and Rural Training, Research, and Demonstration Farming Center on 1,325 acres in Sumter County, Ala., near Epes, Ala. From this rural location, central to our membership, and from State association offices in areas where we have members, we operate our program of technical assistance, training and services to our membership and other rural residents in the South.

In September 1977 the Federation of Southern Cooperatives was awarded a 15-month contract from ACTION for $530,000, Contract No. 131-0002/1, as a VISTA national grantee. On February 1, 1979, this contract was renewed for a second year with a budget of $600,780. As a VISTA national grantee we are funded to support 100 locally recruited volunteers, LRV's, and 10 nationally recruited volunteers, NRV's. We presently have 110 volunteers actively working under our second contract; of these 50 are re-enrolling volunteers and providing a second year of service. The 110 volunteers are located at 65 sites in 10 States, South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana, Missouri, Arkansas, Texas, and Kentucky. These volunteers provide our cooperative, credit union and community development corporation membership with needed outreach, education and development assistance.

Since our founding in 1967, the federation has always felt that basic community organization and membership education were critical to the success of our cooperative economic development efforts

among low income people. People who are disadvantaged and economically exploited require special organizing efforts and concern. Time must be spent on thoroughly explaining and understanding the "cooperative principles," open membership, democratic control, limited returns on investment, division of surplus earnings based on patronage, et cetera, before poor people can be expected to internalize and utilize them in improving the condition and quality of their daily lives.

The Federation of Southern Cooperatives appreciates and applaudes the leadership of ACTION and VISTA for their interest in human service delivery through the development of local community organizations and local leadership. We feel there is much wisdom in ACTION/VISTA interest and programmatic thrust toward utilizing its resources to promote and support community organizing and development of poor people at the local neighborhood grassroots level. We understand that this programmatic thrust within ACTION has been severely and unjustly criticized by some who would prefer poor people and minorities to remain docile, subservient and easily exploitable. We feel VISTA's commitment to the self-help development approach will allow poor people to share more adequately and equitably in the social, political, and economic life and benefits of this Nation.

Through our VISTA national grant, we have had the opportunity to involve over 150 local low-income residents as locally recruited volunteers, LRV's. Many of these persons were already volunteering a portion of their time to cooperative activities but the VISTA program has enabled them to make a more serious and systematic commitment to support local organizing for economic development activities.

The use of LRV's is one of the main characteristics that made being a VISTA national grantee attractive to our organization. I might add although we received $600,000 for this contract, it costs us between 15 and 18 percent to administer the program. So, we must have a tremendous amount of faith. We are a poor organization and 15 percent of $600,000 is a lot of money to us.

Ten of the VISTA's are nationally recruited. We have tried to recruit NRV's with specialized skills, for example, lawyers, accountants, a registered nurse, handicraft designer, to provide backup technical assistance to the LRV's and our network of cooperatives and credit unions.

Each LRV and NRV has a set and specific job assignment_and tasks to accomplish. As an example, at agriculture co-ops, the LRV must work with and visit 100 of the co-op members monthly and work on a concentrated basis with 30 co-op members to help them raise their net incomes by a minimum of $1,000 annually.

At each credit union, the LRV must recruit 100 new members and increase saving by $10,000 or more from existing and new members each year. At handicraft and consumer cooperatives there are similar quantitative and qualitative benchmarks and goals. We are hoping over a 3 to 5 year period the VISTA program, coupled with other resources, will place many of our member groups on a self-sufficient basis, perhaps even give them the capacity to employ the VISTA workers or similar persons on a permanent basis.

During the first year of our VISTA national grant, some of our accomplishments were:

Revived contact with 20,000 member families of FSC member cooperatives and credit unions;

Directly assisted over 3,000 small farm families to make more ef ficient and productive use of their land and increase their family incomes;

Added over one-quarter million dollars to the assets of our member credit unions;

Assisted ten handicraft cooperatives in the marketing and sales of their products;

Provided each cooperative and credit union with information and training on the new National Consumer Cooperative Bank and other relevant State and Federal programs;

Made countless referrals for social services, for example, food stamps, legal services, health care, training programs and others, to assist local residents in rural areas;

Increased membership of the Minority Peoples Council on the Tennessee-Tombigbee Waterway from 2,000 to 4.000 members, and helped to raise over $15,000 toward capitalization of the MPCMESBIC to insure minorities and poor people are more fully involved in the benefits of this maior Federal public works project.

Based on the benefits the VISTA national grant program to the Federation of Southern Cooperatives and other regional and national organizations we strongly urge the continuance and expansion of this component and the total VISTA/ACTION program. We support the continuance and expansion of VISTA national grants for the following reasons:

First: The VISTA national grants program allows regional organizations to develop programs of scale and efficiency to serve smaller community development projects which may otherwise not be served by regular VISTA programs, because of their size and lack of knowledge and expertise in securing funding.

Second: The VISTA national grants program allows for the establishment of collaborative networks of small community development projects with similar goals and objectives across State and regional lines. These networks can provide training, information, technical assistance, and other mutual support to lessen the dependence on external support.

Third: The VISTA national grants program provides for creative and demonstration use of volunteers in community development efforts. Some of these unique uses of volunteers may not be attempted by regular State VISTA programs.

Fourth: The VISTA national grants program allows regional organizations to integrate volunteer services with other programs and thereby extend the effectiveness of VISTA resources in conjunction with other Federal and State programs and private programs. In our Federation program, we have many examples of this, including:

Use of LRV's in conjunction with our small farmer energy conservation program funded by CSA to assist small farmers to increase their livelihood and decrease their operating costs, by converting from nonrenewable to renewable sources of energy;

FSC Judicare-Legal Services Demonstration Delivery program in six rural counties in Alabama and Mississippi. LRV's are being trained and used as paralegals;

Black Belt Community Health Center, a rural health delivery program in Sumter County, Ala., is using the LRV's as nutrition outreach aides with their Womens, Infants and Childrens, WIC, program; The Rural Womens Opportunity Center, a program funded to FSC, by the Womens Education Equity Act, OE/HEW, is using the VISTA's to refer women who are interested in placement in nontraditional educational and employment opportunities;

An FSC farmworkers housing re-hab program, funded under CETA, will use the LRV's to assist in locating persons in need of housing assistance and aid them in the FmHA loan process to fund improvements which will be carried out by the CETA construction trainees under this program.

Fifth: VISTA national grants enable regional organizations, such as the Federation, to involve local people as volunteers in workinglearning-organizing capacities with the organization so that leadership development can take place toward the full realization of the purposes and goals of our organization.

Finally, I would like to make one concluding remark. I would like to say oftentimes when we lack the traditional tools to adjust a bad situation that is occurring in our economy, like what we are experiencing right now, we tend to rely on traditional mechanisms to expand or to contract the economy as the situation would require.

However, oftentimes these tools and benefits that may accrue from these adjustments will benefit benefit a certain group of people, but offer no guarantee to poor people. Poor people still do not have access to capital when it is cheap; they do not have access to jobs when jobs are more readily available, primarily because they cannot qualify for these opportunities.

They do not have the collateral necessary. They do not have the entrepreneurial skills. They do not have the training, education, and motivation oftentimes to qualify for this situation. Just as an industry before it begins a new activity must develop physically infrastructural activities, the same applies to poor people.

A human infrastructure must occur to prepare people with the entrepreneurial skills to apply and to enter the public and private sector job market to start single proprietorships, small businesses or to engage in community development activities, cooperative economic development activities.

And I think that is what VISTA is trying to do, both with the standard program and its national programs, to concentrate on these preconditions for development among the poor, for involvement among

the poor.

I would like to commend VISTA for this effort and congratulate them and encourage their leadership in this effort. And I would like to encourage them to try to influence other agencies to cooperate with them in this interest.

I would like to also in conclusion, invite you and the members of this panel to visit with us in our operation in Alabama, to visit with us in some of the cooperatives like in South Carolina. We would like

to ask you to take Congressman Michel and other Members of Congress to visit with us. We would like for you to test the theoretical assumptions with the empirical reality of the poor, the real world of the poor and judge for yourselves the benefit of this particular program. Thank

you.

[The prepared statement of Charles Prejean follows:]

PREPARED STATEMENT OF CHARLES O. PREJEAN, EXECUTIVE DIRECTOR, FEDERATION OF SOUTHERN COOPERATIVES, RURAL TRAINING AND RESEARCH CENTER, EPES, ALA.

I am Charles O. Prejean, Executive Director of the Federation of Southern Cooperatives.

The Federation of Southern Cooperatives is a service, resource and advocacy association, for a constituency of 30,000 low income families, organized into over 100 cooperatives and credit unions, in rural communities across the South. Our membership is composed primarily of Black low income people, although we also include Whites, Chicanos and Native Americans among our membership.

The Federation was chartered in 1967, as an outgrowth of the Civil Rights Movement, by twenty-two (22) low income cooperatives then in existence. Over the past twelve years, we have grown to include over a hundred member cooperatives in fourteen Southern states, stretching from the Rio Grande Valley in Texas to the Eastern shore of Virginia. In 1971, we established our headquarters and Rural Training, Research and Demonstration Farming Center on 1,325 acres in Sumter County, Alabama near Epes, Alabama. From this rural location, central to our membership, and from State Association offices in areas where we have members, we operate our program of technical assistance, training and services to our membership and other rural residents in the South.

In September 1977, the Federation of Southern Cooperatives was awarded a 15 month contract from ACTION for 530,000 (Contract No. 131-0002 (1) as a VISTA National Grantee. On February 1, 1979, this contract was renewed for a second year with a budget of $600,780.

As a VISTA National Grantee, we are funded to support 100 Locally Recruited Volunteers (LRV's) and 10 Nationally Recruited Volunteers (NRV's). We presently have 110 volunteers actively working under our second contract, of these 50 are re-enrolling volunteers providing a second year of service. The 110 volunteers are located at 65 sites in ten states (South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana, Missouri, Arkansas, Texas and Kentucky). These volunteers provide our cooperative, credit union and community development corporation membership with needed outreach, education and development assistance.

Since our founding in 1967, the Federation has always felt that basic community organization and membership education were critical to the success of our cooperative economic development efforts among low income people. People who are disadvantaged and economically exploited require special organizing efforts and concern. Time must be spent on thoroughly explaining and understanding the "cooperative principles" (open membership, democratic control, limited returns on investment, division of surplus earnings based on patronage, etc.) before poor people can be expected to internalize and utilize them in improving the condition and quality of their daily lives.

The Federation of Southern Cooperatives appreciates and applaudes the leadership of ACTION and VISTA for their interest in human service delivery through the development of local community organizations and local leadership. We feel there is much wisdom in ACTION/VISTA interest and programmatic thrust toward utilizing its resources to promote and support community organizing and development of poor people at the local neighborhood grassroots level. We understand that this programmatic thrust within ACTION has been severely and unjustly criticized by some who would prefer poor people and minorities to remain docile, subservient and easily exploitable. We feel VISTA'S commitment to the self-help development approach will allow poor people to share more adequately and equitably in the social, political and economic life and benefits of this nation.

Through our VISTA National Grant, we have had the opportunity to involve over 150 local low income residents as Locally Recruited Volunteers (LRV's). Many of these persons were already volunteering a portion of their time to