The Labor Department has served notice that it will cut or cancel about 400 job-training contracts under the Comprehensive Employment and Training Act (CETA), many of them given by departing Democratic officials to private groups that had endorsed former president Carter's reelection bid.
Among those who will feel the ax are the Rev. Jesse Jackson's Operation Push, the AFL-CIO, the National Urban League, the A. Philip Randolph Institute, the National Association of Counties and the American Federation of State, County and Municipal Employes.
The cuts are designed to relieve in overcommitment of $42 million in special discretionary funds resulting in port from last-minute telegrams and letters sent out by the Employment and Training ADMINISTRATION (ETA) under the direction of then-assistant Secretary Ernie Green and an aide, Edmond Godwin. The rain of telegrams -- committing millions to various organizations -- continued through Jan. 19, the day before President Reagan was sworn in.
When rumors of the 11th-hour commitments reached Labor Secretary Raymond J. Donovan and Senate Labor Committee Chairman Orrin G. Hatch (R-Utah), the result was an intensive review of projects.
Green, in an interview with The Washington Post early in March, said he had full legal power to make commitments until the close of business Jan. 19. He said it was clear to him that the philosophy of the Reagan administration was "not one of support" for the kinds of job-training programs needed by minorities, and he wanted "to see that these organizations could continue to operate long after we left office."
However, on Thursday the Labor Department began notifying contractors and many of those who had received last-minute funding telegrams that the money would be canceled, cut back or that contracts would not be renewed when they expired.
One telegram notified Jackson's PUSH for Excellence Inc. that a $2 million contract for a career exploration project, signed Dec. 31, would be canceled.
Jackson endorsed Carter during the campaign and spoke out for his reelection several times. Former assistant secretary Green has strongly denied that the PUSH contract had anything to do with Jackson's endorsement, declaring that it was just an enlargement of a $550,000 grant Jackson obtained several years ago.
Jackson could not be reached for comment, but he said on March 13 that expected cuts in grants to black organizations were "an attempt to intimidate those who have views different from the administration's present posture. . . . I believe that we're singled out on a political hit list."
Another telegram went to RTP of New York, a nonprofit group that Green headed just before coming to the Labor Department. During the years Green was in charge of the ETA at Labor, RTP received $36.5 million in grants or commitments from the ETA, the last major installment coming in an $8.6 million contract signed Dec. 31.
RTP was notified last Tuesday that $1,130,000 of the $8.6 million would be canceled, as well as $350,000 promised Jan. 1 for a youth demonstration program.
A number of other black organizations that received last-minute commitments lost some or all of their money.
The Black Music Association is to lose a $102,000 grant. The A. Philip Randolph Institute will lose a $1.1 million contract executed Jan. 5. The National Council of Negro Women will lose a $304,775 grant committed by telegram Jan. 19. The National Urban League, which has a number of contracts, is losing one for $750,000.
However, some other grants or contracts to the Urban League and the National Council of Negro Women will be approved. Coretta Scott King's Martin Luther King Jr. Center for Social Change will get the $200,000 it had been promised by telegram.
Other organizations are being cut as well. The Human Resources Development Institute, an offshoot of the AFL-CIO (which endorsed Carter for reelection) will lose $537,000 for a job program. The National Association of Counties will lose $250,000, Stanford University $300,000, the Service Employes International Union $250,000 and the Governor's Office of Wisconsin $200,000. The University of the District of Columbia will lose $100,893 that had been committed Jan. 19 for a single-parent demonstration project.
Included among the 400 notices being sent are advisories to many other organizations that their contract, while not being canceled or cut back now, won't be renewed when it expires.
A large number of unions, some of which supported Carter, will feel the ax here, among them the United Food and Commercial Workers, the George Meany Labor Center and the American Federation of State, County and Municipal Employes.
Also slated to lose eventually: the Brookings Institution, Howard University, Columbia University and dozens of others.
When all these cuts are made, the department will actually end up saving more than just the immediate $42 million shortfall.