This document contains testimony and written statements on a proposal to amend the Older Americans Act of 1965 to authorize grants to states for demonstration projects that provide services to older persons in return for their service as volunteers. Persons testifying included representatives of the Reagan Administration, voluntary nonprofit organizations, various individuals who have been offering such projects over the past several years, and sponsors of the act. Some of the questions addressed in the hearing included the following: (1) will this policy increase the amount of service available to older individuals? (2) will this policy create an entitlement that cannot be guaranteed by the federal government? and (3) will persons who have not previously volunteered be denied services when participants begin to cash in their credits? Those who testified or gave written statements both supported and rejected the idea of credits for volunteer service, although the majority of those testifying were in favor of some sort of credit system. They testified that such a system would make more volunteer help available and make it easier for senior citizens to accept help. Others were concerned that even more bureaucracy would be created, and they anticipated bookkeeping problems. Further testimony on the proposal was expected following the hearing. (KC)