As part of a series of hearings on the reauthorization of the Higher Education Act of 1965, testimony was heard on the safety and soundness of the Student Loan Marketing Association (Sallie Mae). Witnesses discussed many issues surrounding financial oversight of federal agencies and financial risk to the taxpayer through the potential failure of such institutions. Legislation proposed by the Administration to improve oversight was discussed as well as particulars of the financial status of Sallie Mae and recommendations for reforms to its administration. Among the witnesses testifying were the following: Michael Basham, Secretary for Federal Finance; Richard L. Fogel, Assistant Comptroller General for Government Programs, General Accounting Office; James L. Blum of the Congressional Budget Office, and Lawrence A. Hough of the Student Loan Marketing Association. Also included are the prepared statements of the witnesses and of others who could not appear for the hearing, along with letters and supplemental materials. (JB)