PAPERWORK REDUCTION ACT OF 1870

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85-00003R000300050010-5
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 357
• Document Creation Date: December 20, 2016
• Document Release Date: May 17, 2007
• Sequence Number: 10
• Publication Date: February 7, 1980
• Content Type: OPEN SOURCE

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PAPERWORK REDUCTION ACT OF 1980
HEARINGS
SUBCOMMITTEE OF THE
COMMITTEE ON
GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
H.R. 6410
TO REDUCE PAPERWORK AND ENHANCE THE ECONOMY
AND EFFICIENCY OF THE GOVERNMENT AND THE PRIVATE
SECTOR BY IMPROVING FEDERAL INFORMATION POLICY-
MAKING, AND FOR OTHER PURPOSES
U.S. GOVERNMENT PRINTING OFFICE
61-2220 WASHINGTON : 1980
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COMMITTEE ON GOVERNMENT OPERATIONS
JACK BROOKS, Texas, Chairman
L. H. FOUNTAIN, North Carolina
DANTE B. FASCELL, Florida
WILLIAM S. MOORHEAD, Pennsylvania
BENJAMIN S. ROSENTHAL, New York
FERNAND J. ST GERMAIN, Rhode Island
DON FUQUA, Florida
JOHN CONYERS, JR., Michigan
CARDISS COLLINS, Illinois
JOHN L. BURTON, California
RICHARDSON PREYER, North Carolina
ROBERT F. DRINAN, Massachusetts
GLENN ENGLISH, Oklahoma
ELLIOTT H. LEVITAS, Georgia
DAVID W. EVANS, Indiana
TOBY MOFFETT, Connecticut
ANDREW MAGUIRE, New Jersey
LES ASPIN, Wisconsin
HENRY A. WAXMAN, California
FLOYD J. FITHIAN, Indiana
PETER H. KOSTMAYER, Pennsylvania
TED WEISS, New York
MIKE SYNAR, Oklahoma
ROBERT T. MATSUI, California
EUGENE V. ATKINSON, Pennsylvania
FRANK HORTON, New York
JOHN N. ERLENBORN, Illinois
JOHN W. WYDLER, New York
CLARENCE J. BROWN, Ohio
PAUL N. McCLOSKEY, JR., California
THOMAS N. KINDNESS, Ohio
ROBERT S. WALKER, Pennsylvania -
ARLAN STANGELAND, Minnesota
M. CALDWELL BUTLER, Virginia
LYLE WILLIAMS, Ohio
JIM JEFFRIES, Kansas
OLYMPIA J. SNOWE, Maine
WAYNE GRISHAM, California
JOEL DECKARD, Indiana
WILLIAM M. JONES, General Counsel
JOHN E. MOORE, Staff Administrator
ELMER W. HENDERSON, Senior Counsel
JOHN M. DUNCAN, Minority Staff Director
JACK BROOKS, Texas, Chairman
DON FUQUA, Florida FRANK HORTON, New York
WILLIAM S. MOORHEAD, Pennsylvania JOHN N. ERLENBORN, Illinois
DANTE B. FASCELL, Florida ARLAN STANGELAND, Minnesota
FERNAND J. ST GERMAIN, Rhode Island
ELLIOTT H. LEVITAS, Georgia
EUGENE F. PETERS, Staff Director
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CONTENTS
Hearings held on-
Page
February 7---------------------------------------------------
1
February 21 --------------------------------------------------
81
February 26----------------------- ----------------
143
Text of H.R. 6410
3
Statement of-
Alexander, Donald C., vice chairman, Citizens Committee on Paper-
work Reduction; accompanied by John M. Cross, executive vice
president---------------------------------------------------
82
Beck, Carl A., past chairman, Business Advisory Council on Federal
Reports----------------------------------------------------
163
Brooks, Hon. Jack, a Representative in Congress from the State of
Texas, and chairman, Legislation and National Security Subcom-
mittee: Opening statement____________________________________
1
Carr, Frank J., Commissioner of Automated Data and Telecommuni-
cations Service, General Services Administration - - - - -- -- - - -- -- --
132
Fuller, Frances E., chairman of the Legislative Affairs Committee of
the Association of Records Managers and Administrators, Inc-__--
149
Granquist, Wayne G., Associate Director for Management and Regu-
latory Policy, Office of Management and Budget; accompanied by
Jim J. Tozzi, Assistant Director for Regulatory and Information
Policy------------------------------------------------------
88
Kiviat, Philip J., the President's Federal Automatic Data Processing
Reorganization Project; accompanied by Robbin R. Hough, pro-
fessor of economics and management, Oakland University; and
Alton P. Jensen, Georgia Institute of Technology________________
61
Moser, Daniel, cofounder, Association for Federal Information Re-
sources Management--_ ________________________________
144
Staats, Elmer B., Comptroller General, General Accounting Office;
accompanied by John Lovelady, Senior Group Director; Arnold
Jones, Senior Associate Director; and Dan Latta, Planning Director,
General Government Division_________________________________
35
Wacker, Fred P., Assistant Secretary of Defense (Comptroller), De-
partment of Defense; accompanied by Winfield S. Scott, Director,
Management Information Control and Analysis; and Robert L.
Cooper, Office of the Director for Data Automation--------------
108
Letters, statements, etc., submitted for the record by-
Alexander, Donald C., vice chairman, Citizens Committee on Paper-
work Reduction:
Board of trustees and associate trustees---- ----------------------
85
Prepared statement________________________________________
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ouncil on Federa
Reports: Prepared statement________________________________ 166-179
Carr, Frank J., Commissioner of Automated Data and Telecommuni-
cations Service, General Services Administration: Prepared state-
ment----------------------------------------------------- 137-141
Fuller, Frances E., chairman of the Legislative Affairs Committee of
the Association of Records Managers and Administrators, Inc.:
Prepared statement________________________________________ 152-162
Granquist, Wayne G., Associate Director for Management and Regu-
latory Policy, Office of Management and Budget: March 3, 1980,
letter to Comptroller General Staats concerning GAO draft report-99-103
Kiviat, Philip J., the President's Federal Automatic Data Processing
Reorganization Project: Prepared statement------------- - 71-79
Moser, Daniel, cofounder, Association for Federal Information Re-
sources Management: Prepared statement-------------------- 146-148
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Letters, statements, etc.-Continued
Staats, Elmer B., Comptroller General, General Accounting Office: Page
Prepared statement---------------------------------------- 47-60
Wacker, Fred P., Assistant Secretary of Defense (Comptroller), De-
partment of Defense: DOD response to recommendations made by
the Federal Data Processing Reorganization Projects National
Security Team Report------------------------------------- 113-127
APPENDIXES
Appendix A.-Executive Office of the President----------------------- 181
1. Executive Order 12174, November 30, 1979-------------------- 181
2. Paperwork reduction announcement fact sheet--_ ------------------ 183
3. Final draft of Presidential message transmitting message to Con-
gress on paperwork reduction------------------------------- 188
4. Message to Congress regarding paperwork burden, November 30,
1979----------------------------------------------------- 193
Appendix B.-Office of Management and Budget--------------- _ 196
1. Potential cost savings under H.R. 6410------------------------ 196
2. Letter from Wayne G. Granquist to Chairman Brooks, dated
March 3, 1980, regarding administration's views on proposed
location of statistical policy coordination function------------- 199
3. Letter from Wayne G. Granquist to Chairman Brooks, dated
February 26, 1980, transmitting proposed changes to the legisla-
tion----------------------------------------------------- 203
4. Chart illustrating management of Federal paperwork ------------ 207
5. Chart illustrating reformed management of Federal paperwork-_-- 208
Appendix C.-President's Reorganization Project-Final report on "In-
formation Technology and Governmental Reorganization," April 1979- 209
Appendix D.-General Accounting Office, letter from the Comptroller Gen-
eral with enclosures (Mar. 3, 1980) -------------------------------- 296
Appendix E.-Statements submitted for the record-------------------- 310
1. The Associated General Contractors of America---------------- 310
2. Chamber of Commerce of the United States-------------------- 311
3. Civil Aeronautics Board ------------------------------------- 313
4. Commodity Futures Trading Commission---------------------- 315
5. Federal Communications Commission------------------------- 319
6. Federal Reserve System------------------------------------- 322
7. Securities and Exchange Commission-------------------------- 329
8. Environmental Protection Agency---------------------------- 336
Appendix F.-Executive Order 12044, March 23, 1978----------------- 350
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PAPERWORK REDUCTION ACT OF 1980
HOUSE OF REPRESENTATIVES,
LEGISLATION AND NATIONAL SECURITY SUBCOMMITTEE
OF THE COMMITTEE ON GOVERNMENT OPERATIONS,
Washington, D.C.
The subcommittee met, pursuant to notice, at 9:30 a.m., in room
2203, Rayburn House Office Building, Hon. Jack Brooks (chairman
of the subcommittee) presiding.
Present: Representatives Jack Brooks, Elliott H. Levitas, Frank
Horton, John N. Erlenborn, and Arlan Stangeland.
Also present: Eugene F. Peters, subcommittee staff director;
Cynthia W. Meadow, subcommittee professional staff member;
William M. Jones, general counsel; Elmer W. Henderson, senior coun-
sel; James E. Lewin, professional staff member; John M. Duncan,
minority staff director; and Stephen N. Daniels, associate minority
counsel; Committee on Government Operations.
OPENING STATEMENT OF CHAIRMAN BROOKS
Mr. BROOKS. Today we begin hearings on H.R. 6410, the Paper-
work Reduction Act of 1980. This legislation is the result of a growing
concern by the Congress and the President that something must be
done to improve the way the Government collects, uses, and
disseminates information.
Inefficiencies in current Federal information practices threaten
to reduce drastically the effectiveness of the Government, while at the
same time drowning our citizens in a sea of forms, questionnaires, and
reports.
The objectives of H.R. 6410 are:
One, to reduce the information processing burden on the public
and private sectors by requiring development and implementation
of uniform information policies and practices;
Two, to increase the availability and accuracy of Federal data and
information;
Three, to expand and strengthen Federal information management
activities; and
Four, to establish a single focal point for information management
within OMB which will be more identifiable and responsive to the
Congress and the public.
To accomplish these objectives, the bill establishes an Office of
Federal Information Policy within OMB to provide overall direction
for the Government's information policies, standards, and guidelines.
In addition, the bill strengthens the clearance function of the
Federal Reports Act of 1942, which governs the central clearance
of information collection requests by making all Federal agencies
subject to the act. The bill also consolidates the authority to approve
agency data collection requests in OMB.
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Finally, the bill establishes a Federal information locator system
which will contain descriptions of all information requests made by
Federal agencies and any reports which are derived from such requests.
This system will help to eliminate duplication in agencies' record-
keeping requirements, locate existing information that may meet the
needs of the Government and the public, and assist in deciding which
agency information collection requests should be approved.
This bill is based on a long and careful study of the Federal paper-
work problem. While the Government needs a great deal of informa-
tion from its citizens, a lot can be done to cut down on the number and
length of questionnaires, forms and reports, and to eliminate duplica-
tion and inefficiences.
This bill can accomplish that, and its enactment should provide
substantial benefits for virtually every American.
It will not do this job perfectly. I do not think any other legislation
would, but it is a step in that direction and will be of considerable
help toward making those objectives attainable.
[The bill, H.R. 6410, follows:]
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. R. 6410
To reduce paperwork and enhance the economy and efficiency of the Government
and the private sector by improving Federal information policymaking, and
for other purposes.
FEBRUARY 5, 1980
Mr. BROOKS (for himself, Mr. HORTON, Mr. PREYER, and Mr. STEED) introduced
the following bill; which was referred to the Committee on Government
Operations
A BILL
To reduce paperwork and enhance the economy and efficiency of
the Government and the private sector by improving Feder-
al information policymaking, and for other purposes.
1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 That this Act may be cited as the "Paperwork Reduction Act
4 of 1980".
5 SEc. 2. (a) Title 44 of the United States Code is amend-
6 ed by striking out chapter 35 and inserting in its place the
7 following new chapter:
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"Sec.
"3501. Purpose.
"3502. Definitions.
"3503. Office of Federal Information Policy.
"3504. Authority and functions of Director.
"3505. Assignment of tasks and deadlines.
"3506. Federal. agency responsibilities.
"3507. Public information collection activities-submission-to Director; approval
and delegation.
"3508. Determination of necessity for information; hearing.
"3509. Designation of central collection agency.
"3510. Cooperation of agencies in making information available.
"3511. Establishment and operation of Federal Information Locator System.
"3512. Penalty for failure to furnish information.
"3513. Director review of agency activities; reporting; agency response.
"3514. Responsiveness to Congress.
"3515. Administrative powers.
"3516. Rules and regulations.
"3517. Consultation with other agencies and the public.
"3518. Effect on existing laws and regulations.
"3519. Access to information.
"3520. Authorization of appropriations.
3 "?3501. Purpose
4 "It is the purpose of thi chapter to ensure that-
5 "(1) Federal inforr ation policies and practices
6 shall be coordinated and nitegrated with each other
7 and shall be uniform, as' far as practicable, throughout
8 the Federal Government;
9 "(2) information needed by agencies shall be ob.-
10 tained with a minimum burden upon persons and enti-
11 ties required to furnish the information, and obtained,
12 used, and disseminated at a minimum cost to the Gov-
13 ernment;
14 "(3) information collected and tabulated by an
15 agency shall, as far as practieable, be maintained in a
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manner to maximize the usefulness of the information
to Congress, agencies,. and the public;
"(4) the collection, maintenance, use, and dissemi-
nation of personal information by agencies shall be
consistent with the Privacy Act of 1974 and other ap-
plicable laws; and
"(5) automatic data processing and telecommuni-
cations technology shall be acquired and used in a
manner which improves service delivery and program
management, increases productivity, reduces waste and
fraud, and, where possible, reduces the information
processing burden on the public and private sectors.
'13502. Definitions
"As used in this chapter, the term-
"(1) `agency' means any executive department,
military department, Government corporation, Govern-
ment controlled corporation, or other establishment in
the executive branch of the Government (including the
Executive Office of the President), or any independent
regulatory agency; but does not include the General
Accounting Office or the governments of the District of
Columbia and of the territories and possessions of the
United States, and their various subdivisions;
"(2) `collection of information' means the obtain-
ing or soliciting of facts or opinions for any purpose by
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1 an agency by the use of written report forms, applica-
2 tion forms, schedules, questionnaires, reporting or rec-
3 ordkeeping requirements, or other similar methods call-
4 ing for either-
5 "(A) answers to identical questions posed to,
6 or identical reporting or recordkeeping require-
7 ments imposed on, ten or more persons; or
8 "(B) answers to questions posed to agencies
9 or instrumentalities of the United States which
10 are to be used for general statistical purposes;
11 "(3) `data element' means a distinct piece of infor-
12 mation such as a name, term, abbreviation, or symbol;
13 "(4) `data element dictionary' means a system
14 containing standard and uniform definitions and cross
15 references for commonly used data elements;
16 "(5) `data profile' means a synopsis of the ques-
17 tions contained in an information collection request,
18 and also such related items as the official name of the
19 request, the location of information obtained through
? 20 such request, a description of any compilations, analy-
21 ses, or reports derived from such information, the
22 agency responsible for such request, the authorizing
23 statute, and other information necessary to identify,
24 access, and use the data contained in such information;
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1 "(6) `Director' means the Director of the Office of
2 Management and Budget;
3 "(7) `directory of information resources' means a
4 catalog of information collection requests, containing a
5 data profile for each request;
6 "(8) `independent regulatory agency' means the
7 Board of Governors of the Federal Reserve System,
8 the Civil Aeronautics Board, the Commodity Futures
9 Trading Commission, the Consumer Product Safety
10 Commission, the Federal Communications Commission,
11 the Federal Deposit Insurance Corporation, the Feder-
12 al Election Commission, the Federal Energy Regula-
13 tory Commission, the Federal Home Loan Bank
14 Board, the Federal Maritime Commission, the Federal
15 Trade Commission, the Interstate Commerce Commis-
16 sion, the Mine Enforcement Safety and Health Review
17 Commission, the National Labor Relations Board, the
18 Nuclear Regulatory Commission, the Occupational
19 Safety and Health Review Commission, the Postal
20 Rate Commission, and the Securities and Exchange
21 Commission, and other similar agencies designated by
22 statute as independent regulatory establishments of the
23 Federal Government;
24 "(9) `information collection request' means a writ-
25 ten report form, application form, schedule, question-
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1 naire, or other reporting or recordkeeping requirement
2 for the collection of information;
3 "(10) `information referral service' means the
4 function that assists officials and citizens in obtaining
5 access to the Federal Information Locator System;
6 ' "(11) `person' means an individual, partnership,
7 association, corporation, business trust, or legal repre-
8 sentative, an organized group of individuals, a State,
9 territorial, or local government or branch thereof, or a
10 political subdivision of a State, territory, or local gov-
11 ernment or a branch of a political subdivision;
12 "(12) `recordkeeping requirement' means a re-
13 quirement imposed by an agency on persons to main-
14 tain specified records.
15 '13503. Office of Federal Information Policy
16 "(a) There is established in the Office of Management
17 and Budget an office to be known as the Office of Federal
18 Information Policy.
19 "(b) There shall be at the head of the Office an Adminis-
20 trator who shall be appointed by, and who shall report direct-
21 ly to, the Director. The Director shall delegate to the Admin-
22 istrator the authority and responsibility to administer all
23 functions under this chapter. The Administrator shall serve
24 as principal adviser to the Director on Federal information
25 policy.
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1 "? 3504. Authority and functions of Director
2 "(a) The Director shall provide overall direction in the
3 development and implementation of Federal information poli-
4 cies, principles, standards, and guidelines, including review
5 and approval of information collection requests, the reduction
6 of the paperwork burden placed on the public, Federal statis-
7 tical activities, records management activities, privacy of rec-
8 ords pertaining to individuals, interagency sharing of infor-
9 mation, and acquisition and use of automatic data processing
10 and other technology for managing information resources.
11 "(b) The general information policy functions of the Di-
12 rector shall include-
13 "(1) developing and establishing uniform informa-
14 tion resources management policies and overseeing the
15 development of information management principles,
16 standards, and guidelines and promoting their use;
17 "(2) initiating and reviewing proposals for changes
18 in legislation, regulations, and agency procedures to
19 improve information practices, and informing the Presi-
20 dent and the Congress on the progress made in effect-
21 ing such changes;
22 "(3) coordinating, through the review of budget
23 proposals and otherwise, agency information practices;
24 "(4) promoting, through the use of the Federal
25 Information Locator System and the review of budget
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1 proposals, and otherwise, greater agency sharing of in-
2 formation (consistent with the Privacy Act of 1974 (5
3 U.S.C. 552a) and other applicable laws) to enhance the
4 usefulness of the information and limit the reporting
5 burden on the public;
6 "(5) evaluating the agencies' information practices
7 to determine their adequacy, efficiency, and compliance
8 with policies, principles, standards, and guidelines pro-
9 mulgated by the Director; and
10 "(6) overseeing the planning of, and the conduct
11 of research with respect to, Federal information collec-
12 tion, processing, storage, transmission, and use.
13 "(c) The information collection request clearance and
14 other paperwork functions of the Director shall include-
15 "(1) reviewing and approving information collec-
16 tion requests proposed by agencies;
17 "(2) determining whether the collection of infor-
18 mation by an agency is necessary for the proper per-
19 formance of the functions of the agency and has practi-
20 cal utility for the agency;
21 "(3) designating, in accordance with section 3509,
22 a collection agency to obtain information for two or
23 more agencies;
24 "(4) setting goals for reductions of the numbers
25 and burdens of Federal information collection requests;
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1 ` "(5) overseeing action on the recommendations of
2 the'Commission on Federal Paperwork; and
3 %"(6)"designing and operating the Federal Informa-
4 tion Locator System in accordance with section 3511.
5 "(d) The statistical policy and coordination functions of
6 the Director shall include-
7 "(1) developing, in conjunction with the agencies,
8 long range plans forJhe improved performance of Fed-
9 eral statistical activities and programs;
10 "(2) coordinating, through the review of budget
11 proposals and otherwise, the functions of the Govern-
12 ment with respect to gathering, interpreting, and dis-
13 seminating statistics and statistical information;
14 "(3) overseeing the establishment of Government-
15 wide policies, principles, standards, and guidelines cov-
16 ering statistical collection procedures and methods, sta-
17 tistical data classifications, and statistical information
18 presentation and dissemination; and
19 "(4) evaluating statistical program performance
20 and agencies' compliance with Government-wide poli-
21 cies, principles, standards, and guidelines. '
22 "(e) The records management functions of the Director
23 shall include-
24 "(1) providing advice and assistance to the Ad-
25 ministrator of General Services to promote coordina-
H.R. 6410-ih--2
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1 tion in the administration of chapters 21, 29, 31, and
2 33 of this title with the information policies, principles,
3 standards, and guidelines established under this chap-
4 ter;
8
9
10
11
"(2) reviewing compliance by Federal agencies
with the requirements of chapters 21, 29, 31, and 33
of this. title and with regulations promulgated by the
Administrator of General. Services thereunder; and
"(3) coordinating records management policies
and programs with related information programs such
as information collection, statistics, automatic data
12 processing and telecommunications, and similar activi-
13 ties.
14 "(f) The privacy functions of the Director shall in-
15 clude-
16 "(1) overseeing the development of and promul-
17 gating policies, principles, standards, and guidelines on
18 information disclosure and confidentiality, and on safe-
19. _ guarding the security of information collected or main-
20 tained by agencies, or in conjunction with Federal pro-
21 grams;
22 "(2) providing agencies with advice and guidance
23 about information security, restriction, exchange, and
24 disclosure; and
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1 "(3) monitoring compliance with the Privacy Act
2 of 1974 (5 U.S.C. 552a) and related information man-
3 agement laws.
4 "(g) The automatic data processing and telecommunica-
5 tions functions of the Director shall include-
6 "(1) establishing policies, principles, standards,
7 and guidelines for automatic data processing and tele-
8 communications functions and activities, and overseeing
9 the establishment of standards under section 111(f) of
10 the Federal Property and Administrative Services Act
11 of 1949 (40 U.S.C. 759(f));
12 "(2) monitoring the effectiveness of, and compli-
13 ance with, directives issued pursuant to sections 110
14 and 111 of the Federal Property and Administrative
15 Services Act of 1949 (40 U.S.C. 757, 759) and re-
16 viewing proposed determinations under -section 111(g)
17 of such Act;
18 "(3) providing, in coordination with the Adminis-
19 trator of General Services, advice and guidance on the
20 acquisition and use of automatic data processing and
21 telecommunications equipment, . and coordinating,
22 through the review of budget proposals and otherwise,
23 agency proposals for acquisition and use of such equip-
24 ment; and
61-222 0 - 80 - 2
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1 "(4) promoting the use of automatic data process-
2 'ing and telecommunications equipment to improve the
3 effectiveness of the use and dissemination of data in
4 the operation "of federal programs; 'and
"(5) initiating and reviewing proposals for changes
in legislation, regulations, and agency procedures to
improve automatic data processing and telecommunica-
tions practices, and informing the: President and the
9 Congress of the progress made in effecting such
10 changes.
11 "(h).Other functions of the Director shall include ensu'r-
12 ing that, in developing rules and regulations, agencies-
13 "(1) utilize efficient methods to collect, use, and
14 disseminate necessary information;
15 "(2) provide an early and substantial opportunity
16 for the public to comment on proposed means of col-
17 letting information related to such rules and regula-
18 tions; and
19 "(3) make assessments of the consequences of al-
20 ternative methods of implementing the statutory goals
21 of such rules and regulations (including alternative
22 methods of collecting information).
23 "(i) In any review of regulations by the Director author-
24 ized by law, the Director shall consider the relationship of
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1 such regulations to the policies, principles, standards, and
2 guidelines established under this chapter.
3 43505. Assignment of tasks and _deadtines
4. "In carrying out the authority and functions assigned by
5 this chapter, the Director shall-
"(1) within one year after the date of enactment
of the Paperwork Reduction Act of 1980-
"(A) establish standards and requirements for
9 agency audits of all major information systems,
10 assign . the ? responsibility for conducting such
11 ? audits., and, assign. the responsibility for conducting
12 , Government-wide or multiagency audits;
13 , .(B) establish the Federal Information Loca-
14 or. System;
15 "(C) identify areas of , duplication in informa-
16 tion collection , requests and . develop a schedule
17 and methods for eliminating the duplication;
18 "(D) develop a proposal ,to augment the Fed-
19 eral. Information Locator System to include data
20 ,, profiles of major information holdings of agencies
21 (used in the conduct of their operations) which are
22 not, otherwise, required, by this chapter to be in
2,,31,.:
24,.
25 .
eluded in the Sy.s em,. an
develop, in consultation with the Ad-
mimstr for
eneral Services, ,a; five-year plan
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1 for meeting the ' automatic data processing and
2 telecommunications needs of the Federal Govern-
3 ment' in accordance with the requirements of sec-
4 tion 111 of the Federal Property and Administra-
5 tive Services Act of 1949 (40 U.S.C. 759) and
6 the 'purposes of the Paperwork Reduction Act of
7 1980; and
8 "(2) within two years after such date of enact-
9 ment-
10 "(A) establish a schedule and a management
11 control system (including policies, principles,
12 standards, and guidelines) to ensure that practices
13 and programs of the various information handling
14 disciplines, such as records management, are ap-
15 propriately integrated with each other, and with
16 the broad information policies established by this
17 chaptar;
18 "(B) identify initiatives which may achieve
19 substantial productivity improvement in Federal
20 operations using information processing technol-
21 ogy;
22 "(C) develop .a program to (i) enforce Federal
23 information processing standards, particularly Ian-
24 guage standards, at all Federal installations; and
25 (ii) revitalize the standards development program,
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1 separating it from peripheral technical assistance
2 functions and directing it to the most productive
3 areas;
4 "(D) complete action on recommendations of
5 the Commission on Federal Paperwork, including
6 development of legislation necessary to implement
7 such recommendations; and
8 "(E) submit to the President and the Con-
9 gress legislative proposals to remove inconsisten-
10 cies in laws and practices involving privacy, confi-
11 dentiality, and disclosure of information;
12 3506. Federal agency responsibilities
13 "(a) Each agency shall be responsible for carrying out
14 its information management activities in an efficient, effec-
15 tive, and economical manner, and for complying with the in-
16 formation policies, principles, standards, and guidelines pre-
17 scribed by the Director.
18 "(b) The head of each agency shall designate, within
19 three months of the date of enactment of the Paperwork Re-
20 duction Act of 1980, a senior official who reports directly to
21 such agency head to carry out the responsibilities of the
22 agency under this chapter.
23 "(c) Each agency shall-
24 "(1) systematically inventory its major information
25 systems and periodically review its information man-
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1 agement activities, including planning,, budgeting, orga-
2 nizing, directing, training, promoting, controlling, and
3 other managerial activities involving the collection,
4 use, and dissemination of information;
.5: "(2) take steps to ensure that its, information sys-
6 terns do not overlap each other, or duplicate those of
7 other agencies;
"(3) develop procedures for assessing the paper-
9 ,work and reporting burden of,its information collection
10 ?activities .and of proposed legislation and regulations
11 related: to such agency; and
12 "(4) assign to the. official designated. under subsec-
1.3. J ion, (b). the responsibility for, the conduct of and ac-
14: countability for any., acquisitions, made pursuant to a
.15 , delegation of authority under, section 1.11 of. the. Feder-
16 , . al Property. and, Administrative Services Act of. 1949
17 (40 U.S.C. 759).
:18.; . . "(d) The head of each agency,shall establish.such proce-
13 dures. as he may.deexn necessary, to ensure the compliance of
.20 his agency. with, the requirements .of the Federal Information
21Locator, System;, including necessary .screening and compli-
22 ance activities.
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1 "? 3507. Public information collection activities-submis-
2 Sion to Director; approval and delegation
3 "(a) An agency shall not conduct or sponsor the collec-
4 tion of information unless, in advance of adoption or revision
5 of the request for collection of such information-
"(1) the agency, has taken appropriate steps, in-
cluding, consultation with the Director (A) to eliminate
8 information collections, which seek to obtain informa-
tion available from another source within the Federal
10 , Government. (through the use of the Federal Informa-
tion: Locator System and other. means), (B) to reduce
12..
the, compliance burden on respondents, and (C) to for-
13
mulate plans for tabulating the information in a manner
14
which will enhance. its usefulness to other agencies and
15
to the public; . .
16
"(2) the agency has submitted to: the Director the
17
proposed information collection request, copies of perti-
18
nent regulations and of other related materials as the
19
Director may, specify, and an explanation of measures
20
taken to satisfy paragraph (1) of this section,, and has
21, caused a,notice of, such submission to be published in
the Federal Register; and
"(3) the Director has. approved the proposed infor-
mation collection request, or sufficient time, has elapsed
as. provided under subsection. (c). .
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1 "(b) Any disapproval, in whole or in part, under subsec-
2 tion (a) of a proposed information collection request of an
3 independent regulatory agency may be voided if the agency,
4 by a majority vote of its members, overrides the Director's
5 decision.
6 "(c) The Director shall, within sixty days of receipt of a
7 proposed information collection request, notify the agency in-
8 volved of his decision to approve or disapprove the request. If
9 the Director determines that a request submitted for review
10 cannot be reviewed within sixty days, he may, after notice to
11 the agency involved, extend the review period for an addi-
12 tional thirty days. If the Director does not notify the agency
13 of an extension, denial, or approval within sixty days (or, if
14 he has extended the review period for an additional thirty
15 days and does not notify the agency of a denial or approval
16 within the time of the extension), his approval may be in-
17 ferred and the agency may collect the information for not
18 more than two years.
19 "(d) No approval of an information collection request
20 shall be valid for a period of more than three years.
21 "(e) If the Director finds that a senior official designated
22 pursuant to section 3506(b) has independence from any pro-
23 gram responsibility and has sufficient resources to evaluate
24 whether proposed information collection requests should be
25 approved, the Director may, by rule subject to the notice and
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19
1 comment provisions of chapter 5 of title 5, delegate to such
2 official his power to approve proposed requests in specific
3 program areas, for specific purposes, or for all agency pur-
4 poses. Such delegation shall not preclude the Director from
5 reviewing individual information collection requests if the Di-
6 rector determines that circumstances warrant such a review.
7 The Director shall retain authority to revoke such delega-
8 tions of power, both in general and with regard to any specif-
9 is matter. In acting for the Director, any official to whom
10 approval powers have been delegated shall comply fully with
11 the rules and regulations promulgated by the Director.
12 "(f) No agency shall be exempt from the requirements of
13 this chapter.
14 'T 3508. Determination of necessity for information; hear-
15 ing
16 "Before approving a proposed information collection re-
17 quest, the Director shall determine whether the collection of
18 information by an agency is necessary for the proper per-
19 formance of the functions of the agency and has practical
20 utility for the agency. Before making a determination the Di-
21 rector may give the agency and other interested persons an
22 opportunity to be heard or to submit statements in writing.
23 To the extent, if any, that the Director determines that the
24 collection of information by an agency is unnecessary, for any
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20
1 reason, the agency may not engage in the collection of the
2 information.
3 "? 3509. Designation of central collection agency
4 "The Director may designate a collection agency to
5, obtain information for two or more agencies if the Director, is
6 of the opinion that the needs of such agencies for information
7 will be adequately served by a single, collection agency, and
8 such sharing of data does not conflict with, section 3510 of
9 this chapter, section 552 or 552a of title 5, or. any other
10 applicable law. In such. cases, the. Director shall , prescribe
11 (with reference to the collection of information) the: duties and
12 functions of the -collection agency so. designated and of the
13 agencies for which it is to act as agent (including reimburse-
W. me,nt for costs). While the, designation is, in .efft,an agency
15 covered by it may not obtain for itself information which it is
16 , the duty. of the collection, agency to obtain., The, Director may
17 modify the ; designation from ,time , to time as circumstances
18 require.
19 "? 3510.. Cooperation of agencies ; in making information
20:.. , . available
21 "(a) Subject to .subsection ,(b),. the Director, may, if not
22 inconsistent . with any ; applicable, .law, , .direct., an , agency to
23 make available to another . agency information obtained- pur-
24. suant to an information collection, request. ,
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1 N- T6 Director' riay-direct` the disclosure of e6nfiden-
2 tial information from one agency to another if -
3 10t is"d4selused'iii the' fbof statistical totals
or summaries;
"(2) 'the person who supplied the information con-
6 ~ sents io ~ such'a 'di'sclosu'r'e;"or
9
legal
provisions for `civil or criminal penalties against
10 persons failing' to supply the information.
11 "(c) If confidential information obtained by an agency is
12 released by that agency to another agency, all the provision's
13 of law (including penalties which relate to the unlawful di4-
14 closure of information) apply to the officers 'and employees of
15 the agency to which information is released' to the same
16 extent And, in the same manner as the provisions apply to the
17 officers and employees of the agency which originally ob-
18 tamed the information. ''The officers' and employees of the
19 agency to which the information is released, in addition, shall
20 be subject to the same provisions of law, including penalties,
21 relating to the unlawful disclosure of information as if the
22 information had been collected directly by that agency.
23 "(d) For purposes of this section only, confidential infor-
24 mation is information which the agency could withhold from
25 the public under section 552 of title. 5 or would be barred
"(3) the re'ceiving' agency has : authority to collect
the information, 'and 'such authority is supported by
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22
1 from disclosing to another agency under section 552a of such
2 title.
3 '13511. Establishment and operation of Federal Informa-
4 tion Locator System
5 "(a) There is hereby established in the Office of Federal
6 Information Policy a Federal Information Locator System
7 (hereinafter in this section referred to as the `System') com-
8 posed of a directory of information resources, a data element
9 dictionary, and an .information referral service. The System
10 shall serve as the authoritative register of all information col-
11 lection requests.
12 "(b) In designing and operating the System, the Direc-
13 tor shall-
14 "(1) design and operate an indexing system for
15 the System;
16 "(2) promulgate rules requiring the head of each
17 agency to prepare in a form specified by the Director,
18 and to submit to the Director for inclusion in the
19 System, a data profile for each information collection
20 request of such agency;
21 "(3) compare data profiles for proposed informa-
22 tion collection requests against existing profiles in the
23 System, and make available the results of such com-
24 parison to-
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1 "(A) agency officials who are planning new
2 information collection activities; and
"(B) on request, members of. the general
public; and
"(5) ensure that no actual data, except descriptive
data profiles necessary to identify duplicative data or
to locate information, are contained within the System.
3512. Penalty for failure to furnish information
"Notwithstanding any other provision of law, no person
shall be subject to any penalty for failing to provide informa-
tion to any agency if the information collection request in-
volved was made after December 31, 1981, in violation of
section 3507.
14 "? 3513. Director review of agency activities; reporting;
15 agency response
16 "(a) The Director shall, with the advice and assistance
17 of the Administrator of General Services, review, at least
18 once every three years, by means of selective inspections, the
19 information management activities of each agency to ascer-
20 tain their adequacy and efficiency. In evaluating the adequa-
21 cy and efficiency of these activities, the Director shall pay
22 particular attention to whether the agency has complied with
23 section 3506.
24 "(b) The Director shall report the results of the inspec-
25 tions to the appropriate agency head, the House Committee
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24
"'1:; oh- Gov'e"rntnent' Operations, the ;Senate Committee on Gov-
2 ernmentalAffairs,'the House;and'Seriate Committees on Ap-
3, propriatios,,and cbmmittees''of the Congress having jurisdic-
4 tion over legislation relating to the operations of the agency
5 'iivolved
,V]',' "(e) R'ach agency which receives~"areport pursuant to
7' subsection (b) shall, within` sixty'day's 'thereafter, prepare and
8 submit to:,the >Direet&! the ' `House 'Cbmrnittee on Y Govern-
'9 ment Operations; the, Senate -Committee" on Governmental
10 Affairs; the House' and Senate: Committees on'4ppropri-
11 ations; and the committees of the Congress having jurisdic-
12 do i over! legislation relating to` its operations, a written state-
13 ment describing any measures taken to alleviate or remove
?14?'anyproblems or'deficieneies'identified in such report:
15 '13514. Responsiveness to' Congress
16 "(a) The Director shall, keep the Congress and its com-
17 mittees `fully and currently informed of the major activities
18 under this chapter, -and- shall' submit a report thereon to the
19' President of the' Senate' and the Speaker of the House ' of
20 ? Representatives annually. and. at inch other times as~may be
21 necessary for this purpose., The Director shall include in such
22 reports-
23 "(1) proposals for legislative changes needed to
24 improve Federal information management, including,
25 with respect to information collection, recommenda-
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1 tions to ease the burden upon individuals and small or-
2 ganizations;
3 "(2) a compilation of legislative impediments to
4 the collection of information which the Director con-
5 cludes that an agency needs but does not have author-
6 ity to collect;
7 "(3) an analysis by agency, and by such other
8 categories as he may deem useful, describing the com-
9 pliance burden of information collection requests of
10 agencies on persons outside the Federal Government,
11 as well as the costs to agencies;
12 "(4) a summary of accomplishments to reduce the
13 burden of complying with Federal information collec-
14 tion requests by such means as reducing the time, cost,
15 complexity, and incomprehensibility of Federal paper-
16 work;
17 "(5) a tabulation of areas of duplication in agency
18 information collection requests identified during the
19 preceding year and any designations of central collec-
20 tion agencies made to preclude the collection of dupli-
21 cate information;
22 "(6) a list of all violations of provisions of this
23 chapter and rules, regulations, guidelines, policies, and
24 procedures issued pursuant to this chapter; and
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26
1 "(7) with respect to recommendations of the Com-
2 mission on Federal Paperwork-
3 "(A) the specific actions taken on each rec-
4 ommendation which has been completely imple-
5 mented;
6 "(B) the major actions still required to imple-
7 ment each remaining recommendation and the
8 target date for completing each such action;
9 "(C) a detailed assessment of the status of
10 and progress on each such action; and
11 "(D) an explanation of any delays and ac-
12 tions required to overcome these delays.
13 "(b) The preparation of these reports shall not increase
14 the burden on persons outside the Federal Government of
15 responding to mandatory requests for information.
16 "? 3515. Administrative powers
17 "(a) Upon the request of the Director, each agency
18 (other than an independent regulatory agency) shall make its
19 services, personnel, and facilities available to the Director for
20 the performance of functions under this chapter.
21 "(b) Upon the request of the-Director, each agency
22 shall, except when prohibited by law, furnish to the Director
23 and give him access to all information in its possession which
24 the Director may determine to be necessary for the perform-
25 ance of functions under this chapter.
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1 "? 3516. Rules and regulations
2 "The Director shall promulgate rules and regulations
3 necessary to exercise the authority provided by this chapter.
4 "?3517. Consultation with other agencies and the public
5 "In the development of information policies, rules, regu-
6 lations, procedures, and forms, the Director shall, from the
7 beginning of each initiative, consult with persons outside the
8 Federal Government and the agencies affected.
9 "? 3518. Effect on existing laws and regulations
10 "The authority of an agency under any other law to
11 prescribe policies, rules, regulations, procedures, and forms
12 for Federal information activities is subject to the authority
13 conferred on the Director by this chapter.
14 "?3519. Access to information
15 "The Director and personnel in the Office of Federal
16 Information Policy shall furnish such information as the
17 Comptroller General may require for the discharge of his re-
18 sponsibilities. For this purpose, the Comptroller General or
19 his representatives shall have access to all books, documents,
20 papers, and records of that Office.".
21 "?3520. Authorization of appropriations
22 "There are hereby authorized to be appropriated to
23 carry out the provisions of this chapter, and for no other
24 purpose-
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28
1 "(1) not to exceed $8,000,000 for the fiscal year
2 ending September 30, 1981;
3 "(2) not to exceed $8,500,000 for the fiscal year
4 ending September 30, 1982;
5 "(3) not to exceed $9,000,000 for the fiscal year
6 ending September 30, 1983.".
7 (b) The table of chapters of title 44, United States Code,
8 is amended by striking out
"35. Coordination of Federal Reporting Services."
9 and inserting in lieu thereof
"35. Coordination of Federal Information Policy.".
10 (c)(1) Section 2904 of title 44, United States Code, is
11 amended by striking out paragraph (10) and inserting in lieu
12 thereof the following:
13 "(10) report to the appropriate oversight and ap-
14 propriations committees of the Congress and to the Di-
15 rector of the Office of Management and Budget annual-
16 ly and at such other times as he deems desirable (A)
17 on the results of inspections and studies conducted pur-
18 suant to paragraphs (1) through (9) of this section, (B)
19 on evaluations of responses by Federal agencies to any
20 recommendations resulting from such inspections or
21 studies, and (C) on estimates of lost benefits or savings
22 resulting from the failure of agencies to implement
23 such recommendations.".
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1 (2) Section 2905 of title 44, United States Code, is
2 amended by redesignating the text thereof as subsection (a)
3 and by adding at the end of such section the following new
4 subsection:
5 "(b) The Administrator of General Services shall assist
6 the Administrator of the Office of Federal Information Policy
7 in conducting studies and developing standards relating to
8 record retention requirements imposed on the public and on
9 State and local governments by Federal agencies.".
10 SEC. 3. (a) The President and the Director of the Office
11 of Management and Budget shall delegate to the Administra-
12 tor for Federal Information Policy all their functions, authori-
13 ty, and responsibility under section 103 of the Budget and
14 Accounting Procedures Act of 1950 (31 U.S.C. 18b).
15 (b) The Director of the Office of Management and
16 Budget shall delegate to the Administrator for Federal Infor-
17 mation Policy all functions, authority, and responsibility of
18 the Director under section 552a of title 5 and under sections
19 110 and 111 of the Federal Property and Administrative
20 Services Act of 1949 (40 U.S.C. 757, 759).
21 SEC. 4. (a) Section 400A of the General Educational
22 Provisions Act (20 U.S.C. 1221-3) is repealed.
23 (b) Section 201 of the Surface Mining Control and Rec-
24 lamation Act of 1977 (30 U.S.C. 1211) is amended by strik-
25 ing out subsection (e).
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1 (c) Subsection (f) of section 708 of the Public Health
2 Service Act (42 U.S.C. 292h(f)) is repealed.
3 (d) Section 5315 of title 5, United States Code, is
4 amended by adding at the end thereof the following:
5 "Administrator, Office of Federal Information
6 Policy, Office of Management and Budget.".
7 SEC. 5. This Act shall take effect on October 1, 1980.
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Mr. BROOKS. I now would like to recognize the paperwork king of
the Republican Party, a man whose pajamas say "Paperwork,
Paperwork, Paperwork," a man whose coffee cup has "Paperwork"
printed on the outside. They love him and appreciate the tremendous
job he has done in this area. I now recognize Frank Horton of New
York.
Mr. HORTON. Thank you, Mr. Chairman.
Over the last several years there has been a growing understanding
of very fundamental changes that have been taking place in our
society. We are now in an information age in which the Federal
Government, for better or for worse, plays an important role.
Federal paperwork touches every segment of our society, and every
segment is complaining about it. My constituents in Rochester tell me
that they are being strangled by paperwork and regulation. "Strangula-
tion by regulation" is what I call it. Everybody in Washington knows
that a problem exists and is trying to do something about it.
At the recent White House Conference on Small Business, one of
the principal concerns expressed was the overregulation and paper-
work burden that the small businessman has to bear.
As you know, I had the privilege of serving as the Chairman of the
Commission on Federal Paperwork. The 2-year Commission included,
among other persons, Members of Congress; the Comptroller General
of the United States, Mr. Staats, who will be our first witness; the
Director of OMB; the Secretary of HEW; the President's Consumer
Adviser; the IRS Commissioner; and several well-known leaders from
the private sector and State and local governments.
We concluded that information or paperwork management is one
of the important steps we must take to stop the strangulation by
regulation. It touches virtually every one of the critical problems our
Nation is grappling with today: Inflation, unemployment, big
government, the disillusionment and afraid to do business with the
Government, and so on. The Paperwork Commission estimated that
over $100 billion a year is spent in and out of Government on Federal
information needs and handling.
Farmers, truckers, small businessmen and big businessmen alike;
schoolteachers, small hospitals, and colleges all told us horror stories
involving excessive Federal paperwork and redtape.
Some of these poor people just folded their tents and went out of
business because they could not cope with the flood of Government
forms, reports, and recordkeeping requirements. The Commission's
reports to the President and the Congress relate these horror stories
and document the magnitude of the problem.
There is no simple, single solution to the paperwork problem. The
problem is too big for that. The Paperwork Commission did not
discover some magic formula or some new regulation that could
sweep the slate clean. Instead, we found that there are some common-
sense principles that need to be followed, both to reduce the burdens
of paperwork and to enhance the value of information collected.
All of them have one common denominator: The need to manage
information resources. We can no longer afford to have Government
look at data as free and have information and paperwork costs
buried in overhead accounts where the costs cannot even be identified,
much less recovered.
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As the Commission pointed out in its report entitled "Information
Resources Management," the real culprit of the Federal paperwork
burden is mismanagement of information resources. There must be
established in the executive branch an information resources manage-
ment function incorporating and integrating many disparate but
related information activities. These activities must be brought
together under the single management coordination umbrella.
To implement that recommendation, I join with the chairman,
Mr. Brooks, in introducing H.R. 6410, the Paperwork Reduction
Act of 1980, the bill on which we will hear testimony this morning.
We are joined in sponsorship of that bill by Mr. Preyer, the chair-
man of one of the subcommittees of Government Operations, and
also Mr. Steed, who is a former member of the Paperwork Commission,
and who has been very much interested in reducing the paperwork
burden.
This bill recognizes-for the first time in legislation-that manage-
ment of Federal information resources is a responsibility of the Federal
Government. It places the authority for setting information policy
in the Government's central management agency, the Office of
Management and Budget. It insures that information policy will
receive priority attention within OMB by establishing a separate
office to assume responsibility in that area.
Our bill also rewrites the Federal Reports Act of 1942 so that all
agencies are made subject to its provisions. The revised Federal
Reports Act will require the Federal agencies cannot collect infor-
mation from private businesses or other people unless their requests
have been approved by OMB.
To help OMB decide which information requests to approve, the
bill establishes a Federal information locator system, which contains
descriptions of all requests made by Federal agencies for the collection
of information from the public.
The system will be used to identify duplication in existing or new
reporting or recordkeeping requirements, and to locate existing infor-
mation that may meet the needs of an agency that wants to collect that
data. We found, in the Paperwork Commission, that the right hand
often did not know what the left hand collected. The locator system
is an effort to eliminate that problem.
In my view, H.R. 6410 represents a real step forward in the infor-
mation resource management area. A lot of so-called paperwork
reform measures just cut down a few weeds, and the weeds grow right
back up. The permanent structure established by this bill would be
able to pull out problems by the roots, making sure that they would
not reappear.
I would also like to say that the President, just last fall, when he
signed Executive Order 12174, took some very important steps so far
as the executive branch is concerned to reduce paperwork. He indi-
cated his strong support for this bill. [See app. A.]
I also want to take this opportunity to acknowledge, the hard work
of the chairman of this committee, Mr. Brooks, and the staff on both
the majority and minority side, in working with OMB and with the
General Accounting Office to write the provisions of this bill, which I
think is an excellent bill. I hope we can get it enacted very quickly.
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I am very pleased that our first witness this morning, Mr. Chair-
man, is our good friend and my fellow member of the Federal Paper-
work Commission, the Comptroller General, Mr. Staats, who just
recently celebrated his 40th year in service to the Government. Mr.
Chairman, you and I were over at the party honoring Mr. Staats for
his fine service.
Elmer, we are very happy to have you with us and to have you as
our first witness on this very important piece of legislation.
Thank you, Mr. Chairman.
Mr. Bxooxs. Thank you very much, Mr. Horton.
Our first witness is Comptroller General Elmer Staats. General
Staats is well known to us all. He has appeared here many times during
his 13-plus years as Comptroller General.
Prior to that, he served as Deputy Director of the Bureau of the
Budget and as Executive Officer of the Operations Coordinating Board
of the National Security Council.
General Staats' service to the Federal Government has been
outstanding.
He is accompanied today by John Lovelady, a senior group director
responsible for conducting audits of paperwork issues and adminis-
tering GAO's reports clearance functions; by Dan Latta, Planning
Director for Paperwork and Statistical Activities; and Arnold Jones,
Senior Associate Director for the General Government Division.
Welcome, gentlemen.
General, you may summarize your statement if you wish. Of course,
the full text will appear in the hearing record.
STATEMENT OF ELMER B. STAATS, COMPTROLLER GENERAL, GEN-
ERAL ACCOUNTING OFFICE; ACCOMPANIED BY JOHN LOVELADY,
SENIOR GROUP DIRECTOR; ARNOLD JONES, SENIOR ASSOCIATE
DIRECTOR; AND DAN LATTA, PLANNING DIRECTOR, GENERAL
GOVERNMENT DIVISION
Mr. STAATS. Thank you, Mr. Chairman.
I would like to congratulate you and the committee, and Frank
Horton, particularly, because of his leadership as Chairman of the
Federal Paperwork Commission.
My interest in this legislation goes back a long way, to 1942, at
least. It could really save the Government and the private sector
hundreds and hundreds and millions of dollars.
More important, perhaps, even than that, it could do a great deal to
remove the irritations on the part of people outside the Government
who have to deal with the Government and who see unnecessary
paperwork; unnecessary questionnaires. It constitutes a source of
irritation about the Government and the lack of concern on the part
of Government on the burdens they put on the private sector.
Having said that, let me read the statement which we have prepared
in support of this legislation.
The bill would create a central office in the Office of Management
and Budget, OMB, responsible for getting Government-wide infor-
mation policies and for providing oversight for the agencies' informa-
tion management activities.
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Such oversight would include periodic evaluations of the agencies'
information management activities. The activities covered by the bill
include reports clearance and paperwork control, statistics, privacy,
automatic data processing, telecommunications, and records
management.
We strongly support the objectives of H.R. 6410. We believe it
provides, for the first time, the basic central management structure,
including the authority, responsibility, and accountability, for exerting
badly needed control and oversight for these interrelated areas.
Significantly, our analysis of the bill indicates that its provisions
are generally consistent with many of the recommendations of the
Commission on Federal Paperwork. I served, as you noted, as a mem-
ber of that Commission under the able leadership of Congressman
Frank Horton.
I am very pleased that this subcommittee is taking the initiative on
many of the changes recommended by the Commission.
I will now discuss the new management structure for the Govern-
ment's information activities which would be created by the bill.
The proposed structure consists of two key elements, both of which
we believe are essential. First, a central office is created within OMB,
with broad responsibilities for developing consistent information pol-
icies and overseeing agency activities.
Second, a high-level official is to be designated within each agency
who will be held accountable for insuring that the agencies effectively
carry out their information management activities.
We favor the creation of a statutory office in OMB headed by an
appointee of the OMB Director as provided in the bill. Placing the
office in OMB and providing this type of appointment would give
the OMB Director line authority for exercising the office's functions
to insure accountability to the President and the Congress.
We strongly support the creation of this structure which we believe
should enhance the economy and efficiency of Government informa-
tion activities and ultimately reduce the reporting, recordkeeping, and
regulated regulatory burdens imposed on the public.
The bill authorizes specific funding to carry out the office's func-
tions. We believe this is essential for the office to succeed. Historically,
limited resources have been applied to the information management
areas.
Although additional resource allocations recently have been given
to the paperwork and statistics areas, there is no certainty that the
resource levels would continue under this or succeeding administrations.
Accordingly, we agree the Congress should provide specific resource
allocations to OMB to support these activities.
I turn now to specific areas covered by the bill, including one area
we think should be added.
Under the bill, Federal information-related activities include reports
clearance and paperwork control, statistics, privacy, records manage-
ment, automatic data processing, and telecommunications. We agree
that the policy setting and oversight responsibilities-but not the
operating responsibilities-for these areas should be vested in the
new OMB office.
However, we also believe that oversight responsibility for Freedom
of Information Act activities should be vested in the new office. This
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should facilitate the establishment of consistent policies and stand-
ards covering Federal information activities, including sharing and
disclosure.
At the present time, OMB has some degree of responsibility in the
paperwork, privacy, ADP, and telecommunications areas. Under the
bill, the extent of OMB's responsibility in these areas will be expanded
or modified. The areas of statistical policy and records management
policy will be added.
I would like to discuss the statistical policy function later.
With regard to records management, the bill recognizes the need to
provide a cohesive Federal information policy and to coordinate the
various components of Federal information practices. Records
management, concerned with information use and disposition, is a
vital element of information policy.
In the past, this function has not received the level of management
attention it deserves. For example, although GSA is authorized to do
so, it does not report to OMB or to the Congress serious weaknesses in
agencies' records management programs along with the potential for
savings if corrective actions are taken.
We pointed this problem out as early as 1973, but GSA's response to
date has been inadequate.
We believe the assignment of oversight responsibility in OMB and
the periodic evaluations required by the bill would remedy this situa-
tion. In so doing, the benefits which improved records management
practices can bring to the performance of Federal programs can be
realized.
Turning now to the freedom of information issue, OMB provides
central direction and oversight of agencies' activities under authority
of the Privacy Act, but the Freedom of Information Act does not re-
quire similar oversight.
The Department of Justice has assumed this role to some degree.
Justice provides continuing legal guidance and consultation and also
handles litigation resulting from the agencies' denials of requests for
records.
Our recent report on the Freedom of Information and Privacy Acts
shows that these laws generally are effective tools for meeting congres-
sional policy on openness in Government. We concluded that better
oversight and executive direction can improve implementation.
I refer here to report LCD-80-8, October 24, 1979. "An Informed
Public Assures That Federal Agencies Will Better Comply With
Freedom of Information/Privacy Laws."
In the report, we analyzed data on litigation, based on the Freedom
of Information Act and other laws governing disclosure of and access
to public records. Our analysis showed that, when sued, agencies often
released considerable information in records they had originally denied
requesters.
On the basis of these results, we believe better policy guidance in
advance of the litigation stage, coupled with better communication of
the results of past cases, can reduce the necessity for future litigation.
We believe that giving OMB specific policy setting responsibility for
the Freedom of Information Act will provide this much-needed execu-
tive direction and oversight.
Furthermore, because the two laws were intended to complement
each other on matters of public access to records, their administration
within OMB would benefit from close coordination.
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We strongly support the provisions in H.R. 6410 for consolidating,
elevating, and clarifying OMB's policy function for the acquisition
and management of automatic data processing and telecommunica-
tions resources. We are especially pleased that policy and oversight
for ADP and telecommunications are included with the other functions
in the bill.
We have issued many reports on management problems and
Government-wide issues in these rapidly growing areas calling on
OMB to develop, strengthen, improve, or clarify its policy and
guidance.
We have also reported on the special and complex problems of
privacy in ADP and communication systems. OMB has lacked both
sufficient staff and the organization to address many of- our recom-
mendations and concerns.
The bill's provisions for an administrator at a sufficient level of
authority and separate fund authorization address these problems.
The bill's ADP and telecommunications provisions would accomplish
several of the key recommendations of the President's Reorganization
Project for Federal ADP Activities and are also generally consistent
with several Paperwork Commission recommendations.
H.R. 6410 would bring about significant changes in the controls
over collecting information from the public, including:
One: Ending the currently fragmented responsibility for reports
clearance, including the transfer of. GAO's clearance responsibility to
OMB ;
Two : Combining the statistical policy function with reports clearance
in a single organization; and
Three : Amending the Federal Reports Act to clarify certain pro-
visions and eliminate weaknesses.
Progress toward achieving the Federal Reports Act's paperwork
control objectives is hampered because there is no central manage-
ment authority. Instead, control responsibility is fragmented among
three organizations-OMB, GAO, and the Department of Health,
Education, and Welfare-and a substantial portion of the burden
imposed on the public is outside the central control process.
We strongly favor consolidating the fragmented responsibilities
into the new OMB office and eliminating all exemptions to the Federal
Reports Act clearance process.
Until 1973, the responsibility for paperwork control was in OMB.
Then, GAO was assigned responsibility for reviewing and clearing
the independent regulatory agencies' reports; HEW was tasked with
a broad program for collecting data on health professions personnel,
which was exempt from OMB's central review authority; and the
HEW Secretary was assigned responsibility over all Federal data
collections from educational institutions and programs.
This last responsibility will soon be transferred to the Secretary of
Education, fragmenting responsibilities even further.
Finally, in 1977, the President shifted the responsibility for setting
statistical policies and standards and coordinating Federal statistical
activities from OMB to the Department of Commerce. These respon-
sibilities are closely related to the Federal Reports Act objectives for
controlling paperwork burdens.
For example, the application of statistical procedures to information
collection may be helpful in improving the quality of the information
collected and in reducing the reporting burden imposed on the public.
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Because of this close relationship, the necessary coordination be-
tween the two functions is enhanced if the functions reside in a single
organization.
There is also a need to balance the sometimes conflicting interests
for paperwork reduction on one hand, and those for improved sta-
tistics on the other, which can best be performed if both functions
are in one organization.
I, therefore, clearly favor transferring this function from the De-
partment of Commerce to OMB.
In addition, agencies responsible for about 75 percent of the paper-
work burdens are exempt from the Federal Reports Act. These include
the Internal Revenue Service, other Treasury Department agencies,
and supervisory functions of the bank regulatory agencies.
The Commission on Federal Paperwork recommended, and we agree,
that these exemptions should be eliminated. The obvious reason is
that controls are weakened by the exemptions.
A key issue raised as a result of these proposed changes is how to
preserve the independence of the independent Federal regulatory
agencies. For those agencies defined either in this bill or in their
enabling legislation as independent regulatory agencies, section 3507
includes an important "override" provision.
This section provides that OMB review proposed information collec-
tion requests. Any disapproval of a request proposed by an inde-
pendent regulatory agency may be voided if the agency's members
vote, by a majority, to override OMB's decision.
We endorse this provision. It would allow for a "second look" by
the affected regulatory agencies in cases where the proposal for col-
lecting information appears questionable or seems to require revision.
The override provision would also preserve the authority of the inde-
pendent regulatory agencies to determine their information needs.
We would expect that the override mechanism would be used
infrequently. Our own experience and analysis of OMB's implementa-
tion of the Federal Reports Act indicate that, although revisions are
frequently desirable, relatively few information-gathering proposals
are denied outright. They usually turn out to be a compromise.
However, we believe that the independent regulatory agencies' use
of the override should be made on the public record so that the
Congress can monitor these actions.
The changes in the organizational arrangements which I have just
described are only part of the problem needing resolution. We believe
that major revisions are needed to clarify and strengthen the Federal
Reports Act, which was passed in 1942, but remains today the basic
statute providing for the control of Federal paperwork burdens
imposed on the public. These revisions are all incorporated in the bill.
Difficulties we have experienced in administering our reports
clearance responsibilities and our audits support our position that the
changes are needed.
Section 101 of the bill replaces the Federal Reports Act, incorpora-
ting five needed changes. First, recordkeeping requirements are
specifically included in the reports clearance process-section 3502 of
proposed new chapter 35 of title 44.
The Federal Reports Act is presently unclear on whether record-
keeping requirements are subject to clearance. In practice, both
GAO and OMB have required that they be cleared. Some agencies,
however, have resisted compliance with these efforts.
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Second, the act's definition of "information" is clarified to eliminate
the ambiguity. For example, the Securities and Exchange Com-
mission has interpreted the act to apply only to situations where the
answers provided by respondents are to be used for statistical
compilations of general public interest. This interpretation severely
limits the coverage of the act and the controls over Federal information
collection efforts.
Third, the bill clarifies agency responsibilities by requiring agencies
to eliminate duplication, minimize burden, and formulate plans for
tabulating data before they request approval of forms.
Under the Federal Reports Act, the responsibilities of the individual
agencies are unclear. In some cases, agencies have attempted to force
upon OMB and GAO tasks which we believe the agencies should
perform in developing their information collection instruments.
Fourth, OMB is required to evaluate the agencies' information
management controls. This is consistent with a recommendation we
made to OMB some years ago.
However, OMB has not had the staff to adequately carry out this
function. Under such a requirement, OMB should identify ways to
improve the individual agencies' information management controls.
Fifth, the bill authorizes OMB to delegate its clearance authority
to the agencies in cases where the agencies have demonstrated sufficient
capability. OMB would determine an agency's capability on the basis
of the evaluations described above.
This would enable OMB to shift its emphasis to a policy and over-
sight role in contrast to the time-consuming effort of clearing individual
reporting and recordkeeping requirements. This issue is addressed
in our recent report entitled, "Protecting the Public From Unnecessary
Federal Paperwork: Does the Control Process Work?"
Further improvement in carrying out Federal information activities
should be brought about as the agencies implement the Paperwork
Commission's recommendations.
We are pleased that the bill extends for an additional 2 years
OMB's statutory authority to oversee action on the recommendations
of the Commission. OMB's September 1979 report states that almost
half of the recommendations, including many requiring legislation,
are still open. We believe the additional time is necessary to complete
the job.
We endorse the creation of a Federal information locator system,
which would provide a source for locating information maintained by
different Federal agencies and which would help identify and eliminate
unnecessary duplicate collections of information from the public.
We recommended developing such a system in a 1975 report to the
Senate Committee on Government Operations, GGD-75-85, July 24,
1975.
We would suggest, however, that the subcommittee consider
amending section 3511 to allow OMB to delegate operating responsi-
bility for the system to another executive agency. This would enable
OMB to focus its attention on the important policy and oversight
responsibilities in the bill. OMB has begun work on a locator system
and some progress has been made. Much remains to be done, however.
The development of the proposed locator system should be closely
coordinated with GAO's efforts to maintain its inventory of Federal
information resources. This inventory was established under title
VIII of the Congressional Budget Act of 1974, Public Law 93-344.
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The proposed system addresses, as we do, the identification, loca-
tion, and nature of agencies' information sources and their potential
use in the congressional decisionmaking process.
Coodination between the proposed OMB office and GAO will insure
that overlap and duplication of efforts are minimized. As develop-
mental efforts of the locator system proceed, OMB may wish to
incorporate some of the features of our data files.
And, if the locator system can successfully meet its public use
requirements and the Congress information needs, we may wish to
consider consolidating some of our data collection and related activities.
OMB recently reorganized its information and regulatory oversight
activities, bringing together most of its existing functions related to
H.R. 6410. This is a positive step. We do not, however, believe it
negates in any way, the need for this legislation.
Without the legislation, fragmented policy and oversight respon-
sibilities will continue and badly needed changes in Federal informa-
tion management controls will not be effected.
The bill would greatly strengthen the hand of OMB in exercising its
broad responsibilities for improving the management of the Federal
Government.
I would like to stress this point. It is easy to criticize OMB but it
really has not had the charter and the staff it needs to do the job.
In conclusion, we see enactment of H.R. 6410 as an important
landmark in a concerted effort to establish consistent Federal in-
formation policies. The management structure and tools put into
place by this legislation will assist us in working toward solutions for
the many information problems now existing.
We should not, however, deceive ourselves or others that this
legislation represents more than the beginning of a long and difficult
task.
This concludes my prepared statement. We have a number of
technical suggestions for the bill which we will be happy to discuss
with your staff. We shall be pleased to answer any questions which
you or other members of the subcommittee may have.
Thank you.
Mr. BROOKS. This is one of your traditionally excellent statements,
General. I think it is well documented and well thought out and well
put together and a substantial help in justifying the need for this
legislation.
I have a couple of questions I want to ask you and your associates.
Historically, the executive agencies objected to the creation of any
central management or oversight responsibility within the OMB. The
agencies think they have more than sufficient expertise to manage
effectively their own programs, preferably without any oversight by
anybody.
What is your assessment of the executive agencies' performance and
management of information resources and activities?
Mr. STAATS. Well, the record, as we have developed it, Mr. Chair-
man, in a series of GAO reports, would not support that conclusion.
We would be happy to supply, for the record, specific examples in
support of that conclusion. We do not believe the record is that good.
I think the work of the Paperwork Commission fully documents this
point.
[See app. D.]
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Mr. BROOKS. Some concern has been expressed about the ambiguity
of the terms "information policy" and "information management."
As a result, some executive branch officials believe that we should
restrict OMB's authority to information collection requests only.
Do you share this concern?
Mr. STAATS. We do not agree with that conclusion. I would like
my two colleagues here to comment on that, if I may.
Mr. LOVELADY. I believe, Mr. Chairman, we see this bill as a
package deal, if you will. The elements contained in the bill are closely
related. To take them apart, we do not believe that will do the job.
We are talking about information resources management.
If you have the pieces of what goes into making up information
resources management scattered in different agencies, you are not
going to get the job done. We think this bill puts the right pieces
together and puts them together in the right place, OMB.
Mr. BROOKS. Do you have anything to add to that, Mr. Jones?
Mr. JONES. I think that OMB has got to affect not only information
collection, but information policy. I think one of the things we have
observed is the fragmented policy in regards to burden control. As a
matter of fact, in a series of reports, we are questioning the very basis
for the way the Government manages its information collection.
There is a great deal of discussion of burden. This is a consequence
of a lack of sufficient policy oversight.
There is not yet the fundamental concern that if the Government
collects it, it should use it. I think by giving greater policy responsi-
bility to OMB, as the bill intends, I think we will be a good way along
the road to resolving the issues that we have uncovered.
Mr. STAATS. It is just not possible to separate the information policy
activities from the data collection on individual cases. You are talking
about sharing, you are talking about more sampling, or records-
keeping, or collection. You are talking about central agency leadership
for all of these functions.
All these things have to be worked out together.
Mr. BROOKS. Sometimes agencies must issue information collection
requests in a hurry. A tax law passed in December, for example, might
require IRS to revise a tax form very quickly and print it in time for
use the next month.
Does the bill before us allow for prompt clearance of a request like
that, or do we need to revise the bill to provide a fast-track clearance
process for certain information collection?
Mr. STAATS. We do not believe that the IRS should be exempted.
I know well the arguments for that exemption.
Mr. BROOKS. I just listed the IRS as an example. I know that you
do not think they should be exempted.
Mr. STAATS. It is illustrated by the IRS.
Mr. BROOKS. That is right. Any agency might have an emergency.
Mr. STAATS. We see it as something where you do not just come forth
to OMB with a completed package and say you approve or disapprove.
This is something that ought to be worked out by a collection agency
with OMB during the time period for developing the requirements
for information.
Second, there are provisions for shortcutting the process. If the
agency does its own work of the kind that is contemplated in the bill,
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if they do the process of trying to do an impact analysis, then much of
the need for central management is going to be diminished.
I do not see the value or the validity of the argument that you have
to have quick clearance. This is kind of the oldest game in town, that
we should be exempt because we have an emergency requirement.
Mr. JONES. Mr. Chairman, I think the answer is: Yes; the bill allows
for the capability for quick clearances which has nothing to do with
detailed and reasoned review.
There can be a quick 1-day clearance of a form which will allow the
information to be collected. Then the review of the form, with sug-
gestions and recommendations for improvement and the negotiations
that go into it to reduce the burden, would take place during the
subsequent reviews of the form.
There is nothing in this bill that precludes that happening. There
are such situations, and we have had them in exercising our reports
clearance authority where it was absolutely necessary for the public
good to make a quick clearance.
Mr. BROOKS. Then you could do that?
Mr. JONES. We can do that. Your legislation allows that to be done.
Mr. BROOKS. H.R. 6410 vests OMB with considerable authority to
affect virtually every Government activity. It is, therefore, essential
that this legislation provide sufficient accountability to the Congress.
In your mind, what provisions in the bill do you see are key to
meeting this objective?
Mr. JONES. First of all, Mr. Chairman, is the provision allowing
the Director of OMB to appoint the administrator. That is one degree
of accountability.
The requirement that there be annual reporting to the Congress is
another accountability measure. I think most importantly there is the
sunset provision that is included in this legislation, which provides
the ultimate measure of accountability. Its existence is affected.
I think at least those three things will allow the Congress to impose
the degree of accountability that it wishes.
Mr. STAATS. I would like to add that the GAO is there. We will
continue to work actively in this field. We have allocated sizable
resources from our organization. We will continue to report to Con-
gress as this program moves ahead.
Mr. BROOKS. I have one last short question.
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H.R. 6410 provides for a first year authorization of $8 million. This
figure was developed with the assistance and advice of the GAO.
Would you explain to the subcommittee how this figure was derived
and where that money would come from?
Mr. LATTA. Mr. Chairman, the basic figure of $8 million for the
first year was devised by considering the staff resources that are
presently allocated to the paperwork, statistics, the ADP, telecom-
munications, and privacy functions. Those are existing authorizations
and appropriations with different agencies.
So, over half of the positions and over half the amount of money
presently resides in or would actually be transferred to OMB to con-
tinue with the responsibility.
We identified a per person amount out of OMB's 1980 budget
request for what they expected to need for each authorized position
and then multiplied that times the number of positions we felt the
new office should have. This number of positions includes the trans-
fers. The number also includes positions for the additional functions,
the records management oversight, the core of staff to head the
locator system and freedom of information, if it is added to the bill,
as well as the other functions that might need additional resources.
We estimate about a total of 120 positions. At the per person
amount, this worked out to about $6.5 million. Working with com-
mittee staff, we estimated that about $1.5 million would be allocated
for the locator system itself.
So that makes up your total of $8 million for the first year.
Mr. BROOKS. The first part of your statement was that of the $8
million that would be allocated to this section, that half of it was
already budgeted and appropriated?
Mr. LATTA. A little over half ; yes, sir. That is taking into account
the current positions that are in Commerce, OMB, GAO, and other
existing agencies.
Mr. BROOKS. So far as new appropriations are concerned, new
authority, new money, it would not be in excess of $4 million?
Mr. LATTA. Yes, Sir.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
Mr. Staats, based on your great amount of experience regarding the
paperwork problem and also based on your experience as a member of
the Commission on Federal Paperwork, do you feel that this bill is
a major step forward with regard to carrying out the recommendations
of that 2-year study?
Mr. STAATS. I do feel that way very strongly. It is long overdue as a
piece of legislation, in our opinion.
As I emphasized before, the cost of unnecessary paperwork does not
show up very clearly in the budget, but it is there. Its impact on the
public is there.
As you well recall, we made some efforts to try to estimate the cost
of Federal paperwork burden on the private sector. It is a very difficult
thing to do. But we all know that it is very, very large.
Based on the testimony we received from labor organizations, from
universities and State and local governments, as well as private
industry, it is. So, it has grown tremendously, particularly as we add
more and more regulatory programs. A great deal of paperwork
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burden has been associated with regulatory programs, all within the
last 10 years.
I would come back to your specific question. I would say that it is
not only a major step, but it is a necessary step. It also means there is
going to have to be continuous work in this field. It is not a dramatic
kind of thing where you can say: No, we made a change and all of a
sudden everything is now resolved.
It cannot be done that way. It takes a lot of hard grubby work.
Mr. HORTON. What you are saying is that we need something like
this in order to accomplish substantial savings. As I recall, there were
certain administrative functions that the Paperwork Commission
proposed be changed. Some of them required administrative changes,
others required legislation. We are at the point now where we need
legislative changes.
This measure, in my judgment, and I assume in yours too, is an
important change in order for major achievements to be accomplished
in paperwork reduction.
Mr. STAATS. I would agree, right.
It tightens up the Federal Reports Act. It brings together these
related activities as Mr. Lovelady stated so well a few minutes ago.
It gives the OMB a stronger charter than it has had before. It puts
more of the responsibility back in the agencies where it belongs.
I think it improves the coverage. As you well know, so much of the
paperwork is not reviewed by anybody outside the immediate agencies.
I think all these things together make this an important piece of
legislation and just makes a lot of good sense.
Mr. HORTON. I know it is difficult to come up with any specific
figure for cost-savings resulting from enactment of a bill. The chairman
asked a question with regard to the $8 million of first year costs,
however, which represents a net cost of approximately half of that
figure, or $4 million. Is there any way for you to give us any figure with
regard to what benefits might result from this spending?
Mr. STAATS. I think the difficulty of quantifying it in overall terms
is an obvious difficulty. What I think you can do is to demonstrate
benefits by looking at individual cases. We can document this by our
own experience in terms of audits that we have made in agencies like
the Labor Department and other agencies. I do not, however, believe
we can put it together in terms of overall gross benefits.
Mr. HORTON. I think it would be helpful, for example, if you could
furnish for the record a statement which would tend to give us some
sort of direction, some type of analysis of some of the things you have
done which would tend to point the way to some of the benefits that
might be achieved as a result of this bill.
Mr. STAATS. I would consult my colleagues. I believe we can do that.
Mr. JONES. Yes, we can. We will supply it.
Mr. HORTON. That will be helpful.
Mr. BROOKS. Very well.
Without objection, so ordered.
[See app. D, specifically enclosure II.]
Mr. HORTON. Another area with regard to the Federal Reports Act:
The General Accounting Office is responsible for clearance of forms
that come out of regulatory agencies. You are one of the different
agencies that has forms clearance approval responsibility today.
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Wouldn't that remove this authority from GAO and put it under the
OMB?
Mr. STAATS. That is correct. I think we should stress, however, that
the charter we have is a very weak charter in that we cannot deny
approval of an information request, based on our determination that
it is not needed. The regulatory agencies retain the right to make final
judgments on their need for information.
The only time that we can disallow or prevent a questionnaire from
being issued by an agency is if we can demonstrate-and the burden
is on us-that that information is already available somewhere else in
the Government, or that the gathering of the information would place
an unnecessary burden on the respondents. That is not an easy thing
to do.
In the final analysis, the agency has the right to go ahead even
though we disagree. That is not to say that we have not made a major
contribution. In the process of issuing our regulations, we require the
agencies to do more of their homework before they come to us.
Through negotiations we have been able to get them to modify
substantially many of their requests. But it has been without any kind
of a charter where we could eventually say: No, you cannot do it. We
do not have that.
Mr. HORTON. Is it your opinion that this bill, H. R. 6410, would go
a long way toward correcting that problem and making a better
arrangement with regard to forms clearance?
Mr. STAATS. It would.
Mr. HORTON. Do you feel that the provisions of H.R. 6410 would
still permit the independence of the regulatory agencies-that we are
not destroying or in any way diminishing the independence of those
agencies?
Mr. STAATS. We do not think it would diminish the independence of
the boards and commissions that have regulatory responsibilities or
are classified by statute as independent regulatory bodies.
We do think those requests should be reviewed. We do think those
agencies should be subject to the requirements that OMB would specify
as to the kind of information that they should develop on the impact
of those requests.
But if the OMB say we do not think it should go forward, we do
agree that the independent agencies should have the right, by majority
vote on the public record, to say: We think it is so important for our
operation that we are going ahead.
Mr. HORTON. I want to thank you for your testimony.
I have 5 additional questions which I will have staff furnish to you.
I will request that you prepare the answers and furnish them for the
record.
Mr. STAATS. We will be happy to do that.
Mr. HORTON. Thank you.
Mr. BROOKS. Without objection, that will be a splendid way to do it.
[See app. D, enclosure I.]
Mr. BROOKS. I want to thank you very much, General, for you and
your staff coming down. I appreciate your courtesy and cooperation
and your expertise.
Mr. STAATS. Thank you.
[Mr. Staats' prepared statement follows:]
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47
United States General'Accounting Office
Washington, DC 20548
FOR RELEASE ON DELIVERY
EXPECTED AT 9:30 a.m.
Thursday, February 7, 1980
STATEMENT OF
ERMER B. STAATS
COMPTROLLER GENERAL OF THE UNITED STATES
BEFORE THE
SUBCOMMITTEE ON LEGISLATION AND NATIONAL SECURITY
COMMITTEE ON GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
ON H.R. 6410, THE PAPERWORK REDUCTION ACT OF 1980
to discuss H.R. 6410,
The bill would create
went and Budget (OMB)
the "Paperwork Reduction Act of 1980."
a central office in the Office of Manage-
responsible for setting Government-wide
information policies and for providing oversight for the
agencies' information management activities. Such oversight
would include periodic evaluations of the agencies' information
management activities. The activities covered by the bill
include reports clearance and paperwork control, statistics,
privacy, automatic data processing, telecommunications, and
records management.
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48
We strongly support the objectives of H.R. 6410. We
believe it provides for the first time the basic central
management structure--including the authority, responsibility,
and accountability--for exerting badly needed control and over-
sight for these interrelated areas.
Significantly, our analysis of the bill indicates that
its provisions are generally consistent with many of the
recommendations of the Commission on Federal Paperwork. I
served as a member of that Commission under the able leader-
ship of Congressman Frank Horton. I am very pleased that this
Subcommittee is taking the initiative on many of the changes
recommended by the Commission.
NEW MANAGEMENT STRUCTURE CREATED
I will now discuss the new management structure for the
Government's information activities which would be created
by the bill. The proposed structure consists of two key
elements, both of which we believe are essential. First,
a central office is created within OMB, with broad responsi-
bilities for developing consistent information policies and
overseeing agency activities. Second, a high-level official
is to be designated within each agency who will be held
accountable for insuring that the agencies effectively carry
out their information management activities.
We favor the creation of a statutory office in 0MB
headed by an appointee of the 0MB Director as provided in the
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49
bill. Placing the office in OMB and providing this type of
appointment would give the OMB Director line authority for
exercising the office's functions to assure accountability
to the President and the Congress.
We strongly support the creation of this structure which
we believe should enhance the economy and efficiency of
Government information activities and ultimately reduce
the reporting, recordkeeping, and related regulatory burdens
imposed on the public.
The bill authorizes specific funding to carry out the
office's functions. We believe this is essential for the
office to succeed. Historically, limited resources have been
applied to the information management areas. Although addi-
tional resource allocations have recently been given to the
paperwork and statistics areas, there is no certainty that
the resource levels would continue under this or succeeding
administrations. Accordingly, we agree the Congress should
provide specific resource allocations to OME to support these
activities.
SCOPE OF ACTIVITIES
ASSIGNED THE NEW OFFICE
I turn now to specific areas covered by the bill,
including one area we think should be added. Under the
bill, Federal information-related activities include reports
clearance and paperwork control, statistics, privacy, records
management, automatic data processing, and telecommunications.
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We agree that the policy-setting and oversight responsibil-
ities--but not the operating responsibilities--for these areas
should be vested in the new OMB office. However, we also be-
lieve that oversight responsibility for Freedom of Information
Act activities should be vested in the new office. This should
facilitate the establishment of consistent policies and
standards covering Federal information activities, including
sharing and disclosure.
At the present time, OMB has some degree of responsi-
bility in the paperwork, privacy, ADP, and telecommunications
areas. Under the bill, the extent of OMB's responsibility
in these areas will be expanded or modified. The areas of
statistical policy and records management policy will be
added. I will discuss the statistical policy function later.
With regard to records management, the bill recognizes
the need to provide a cohesive Federal information policy and
to coordinate the various components of Federal information
practices. Records management, concerned with information
use and disposition, is a vital element of information policy.
In the past, this function has not received the level of manage-
ment attention it deserves. For example, although GSA is
authorized to do so, it does not report to OMB or to the
Congress serious weaknesses in agencies' records management
programs along with the potential for savings if corrective
actions are taken. We pointed this problem out as early as
1973, but GSA's response to date has been inadequate.
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51
We believe the assignment of oversight responsibility
in OMB and the periodic evaluations required by the bill
would remedy this situation. In so doing, the benefits which
improved records management practices can bring to the per-
formance of Federal programs can be realized.
Turning now to the Freedom of information issue, OMB
provides central direction and oversight of agencies'
activities under authority of the Privacy Act, but the Freedom
of Information Act does not require similar oversight. The
Department of Justice has assumed this role to some degree.
Justice provides continuing legal guidance and consultation
and also handles litigation resulting from the agencies'
denials of requests for records.
Our recent report on the Freedom of Information and
Privacy Acts 1/ shows that these laws generally are effective
tools for meeting congressional policy on openness in Govern-
ment. We concluded that better oversight and executive
direction can improve implementation.
In the report, we analyzed data on litigation, based on
the Freedom of Information Act and other laws governing dis-
closure of and access to public records. Our analysis showed
that, when sued, agencies often released considerable informa-
tion in records they had originally denied requesters.
1/An Informed Public Assures that Federal Agencies Will
Better Comply With Freedom of Information/Privacy Laws
(LCD-80-8, October 24, 1979).
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On the basis of these results, we believe better policy guid-
ance in advance of the litigation stage, coupled with better
communication of the results of past cases, would reduce the
necessity for future litigation.
We believe that giving OMB specific policy-setting
responsibility for the Freedom of Information Act will provide
this much needed executive direction and oversight. Further-
more, because the two laws were intended to complement each
other on matters of public access to records, their adminis-
tration within OMB would benefit from close coordination.
We strongly support the provisions in H.R. 6410 for
consolidating, elevating, and clarifying OMB's policy function
for the acquisition and management of automatic data processing
and telecommunications resources. We are especially pleased
that policy and oversight for ADP and telecommunications
are included with the other functions in the bill. We have
issued many reports on management problems and Government-
wide issues in these rapidly growing areas calling on OMB
to develop, strengthen, improve, or clarify its policy and
guidance. We have also reported on the special and complex
problems of privacy in ADP and communications.systems. OMB
has lacked both sufficient staff and the organization to
address many of our recommendations and concerns. The bill's
provisions for an administrator at a sufficient level of
authority and separate fund authorization address these
problems. The bill's ADP and telecommunications provisions
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would accomplish several of the key recommendations
of the President's Reorganization Project for Federal ADP
Activities and are also generally consistent with several
Paperwork Commission recommendations.
PAPERWORK AND STATISTICAL POLICY
H.R. 6410 would bring about significant changes in the
controls over collecting information from the public, including
--ending the currently fragmented responsibility for
reports clearance, including the transfer of GAO's
clearance responsibility to OMB;
--combining the statistical policy function with
reports clearance in a single organization; and
--amending the Federal Reports Act to clarify certain
provisions and eliminate weaknesses.
I will discuss each of these changes in more detail.
Consolidating fragmented activities
Progress toward achieving the Federal Reports Act's
paperwork control objectives is hampered because there is
no central management authority. Instead, control respon-
sibility is fragmented among three organizations--OMB, GAO,
and the Department of Health, Education and Welfare (HEW)--and
a substantial portion of the burden imposed on the public
is outside the central control process. We strongly favor
consolidating the fragmented responsibilities into the new
OMB office and eliminating all exemptions to the Federal Reports
Act clearance process.
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Until 1973, the responsibility for paperwork control
was in OMB. Then, (1) GAO was assigned responsibility for
reviewing and clearing the independent regulatory agencies'
reports; (2) HEW was tasked with a broad program for collecting
data on health professions personnel, which was exempted from
OMB's central review authority; and (3) the HEW Secretary
was assigned responsibility over all Federal data collections
from educational institutions and programs. This last
responsibility will soon be transferred to the Secretary of
Education, fragmenting responsibilities even further.
Finally, in 1977, the President shifted the responsibility
for setting statistical policies and standards and coordinating
Federal statistical activities from OMB to the Department of
Commerce. These responsibilities are closely related to
the Federal Reports Act objectives for controlling paperwork
burdens. For example, the application of statistical pro-
cedures to information collection may be helpful in improving
the quality of the information collected and in reducing the
reporting burden imposed on the public.
Because of this close relationship, the necessary coordi-
nation between the two functions is enhanced if the functions
reside in a single organization. There is also a need to
balance the sometimes conflicting interests for paperwork
reduction on one hand, and those for improved statistics on
the other, which can best be performed if both functions are
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55
in one organization. I therefore clearly favor transferring
this function from the Department of Commerce to OMB.
In addition, agencies responsible for about 75 percent
of the paperwork burdens are exempt from the Federal Reports
Act. These include the Internal Revenue Service (IRS), other
Treasury Department agencies, and supervisory functions of
the bank regulatory agencies. Tkte Commission on Federal Paper-
work recommended, and we agree, that these exemptions should
be eliminated. The obvious reason is that controls are weakened
by the exemptions.
Preserving regulatory
agencies independence
A key issue raised as a result of these proposed changes
is how to preserve the independence of the independent Federal
regulatory agencies. For those agencies defined either in
this bill or in their enabling legislation as independent
regulatory agencies, section 3507 includes an important
override" provision. This section provides that 0MB
review proposed information collection requests.
Any disapproval of a request proposed by an independent
regulatory agency may be voided if the agency's members
vote, by a majority, to override OMB's decision. We endorse
this provision. It would allow for a "second look" by the
affected regulatory agencies in cases where the proposal for
collecting information appears questionable or seems
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to require revision. The override provision would also pre-
serve the authority of the independent regulatory agencies
to determine their information needs.
We would expect that the override mechanism would be
used infrequently. Our own experience and analysis of
OMB's implementation of the Federal Reports Act indicate
that, although revisions are frequently desirable, relatively
few information-gathering proposals are denied outright.
However, we believe that the independent regulatory agencies'
use of the override should be made on the public record, so
that the Congress can monitor these actions.
Needed changes to the
Fe era Reports Act
The changes in the organizational arrangements which I
have just described are only part of the problem needing resolu-
tion. We believe that major revisions are needed to clarify
and strengthen the Federal Reports Act, which was passed in
1942, but remains today the basic statute providing for the
control of Federal paperwork burdens imposed on the public.
These revisions are all incorporated in the bill. Difficulties
we have experienced in administering our reports clearance
responsibilities and our audits support our position that the
changes are needed.
Section 101 of the bill replaces the Federal Reports Act,
incorporating five needed changes. First, recordkeeping
requirements are specifically included in the reports clearance
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process (Sec. 3502 of proposed new Chapter 35 of Title 44).
The Federal Reports Act is presently unclear on whether record-
keeping requirements are subject to clearance. In practice,
both GAO and 0MB have required that they be cleared. Some
agencies, however, have resisted compliance with these efforts.
Second, the act's definition of "information" is clari-
fied to eliminate an ambiguity (Sec. 3502). For example,
the Securities and Exchange Commission has interpreted the
act to apply only to situations where the answers provided
by respondents are to be used for statistical compilations
of general public interest. This interpretation severely
limits the coverage of the act and the controls over
Federal information collection efforts.
Third, the bill clarifies agency responsibilities by
requiring agencies to (1) eliminate duplication, (2) minimize
burden, and (3) formulate plans for tabulating data before
they request approval of forms (Sec. 3507(a)(1)). Under the
Federal Reports Act, the responsibilities of the individual
agencies are unclear. In some cases agencies have attempted
to force upon OMB and GAO tasks which we believe the agencies
should perform in developing their information collection in-
struments.
Fourth, 0MB is required to evaluate the agencies' infor-
mation management controls (Sec. 3504(b)(5)). This is
consistent with a recommendation we made to 0MB some years
ago. However, 0MB has not had the staff to adequately carry
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out this function. Under such a requirement, OMB should
identify ways to improve the individual agencies' information
management controls.
Fifth, the bill authorizes OMB to delegate its clearance
authority to the agencies (Sec. 3507(e)) in cases where the
agencies have demonstrated sufficient capability. OMB would
determine an agency's capability on the basis of the evalua-
tions described above. This would enable OMB to shift its
emphasis to a policy and oversight role in contrast to the
time-consuming effort of clearing individual reporting and
recordkeeping requirements. This issue is addressed in our
recent report entitled "Protecting the Public from Unnecessary
Federal Paperwork: Does the Control Process Work?" (GGD-79-70;
September 24, 1979.)
Followu on Paperwork
Commission recommen ations
Further improvements in carrying out Federal information
activities should be brought about as the agencies implement
the Paperwork Commission's recommendations.
We are pleased that the bill extends for an additional
2 years OMB's statutory authority to oversee action on the
recommendations of the Commission. OMB's September 1979 report
states that almost half of the recommendations, including
many requiring legislation, are still open. We believe the
additional time is necessary to complete the job.
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Federal Information Locator System
We endorse the creation of a Federal Information Locator
System, which would provide a source for locating information
maintained by different Federal agencies and which would
help identify and eliminate unnecessary duplicate collections
of information from the public. We recommended developing
such a system in a 1975 report to the Senate Committee
on Government Operations (GGD-75-85; July 24, 1975). We
would suggest, however, that the Subcommittee consider
amending Section 3511 to allow OMB to delegate operating
responsibility for the system to another executive agency.
This would enable OMB to focus its attention on the important
policy and oversight responsibilities in the bill. OMB
has begun work on a locator system and some progress has
been made. Much remains to be done, however.
The development of the proposed locator system should
be closely coordinated with GAO's efforts to maintain its
inventory of Federal information resources. This inventory
was established under Title VIII of the Congressional Budget
Act of 1974 (P.L. 93-344). The proposed system addresses,
as we do, the identification, location,and nature of agencies'
information sources and their potential use in the congres-
sional decisionmaking process.
Coordination between the proposed OMB office and GAO
will insure that overlap and duplication of efforts are
minimized. As developmental efforts of the locator system
proceed, OMB may wish to incorporate some of the features
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of our data files. And if the locator system can successfully
meet its public use requirements and the Congress' information
needs, we may wish to consider consolidating some of our data
collection and related activities.
0MB recently reorganized its information and regulatory
oversight activities, bringing together most of its existing
functions related to H.R. 6410. This is a positive step.
We do not, however, believe it negates in any way, the need
for this legislation. Without the legislation, fragmented
policy and oversight responsibilities will continue and badly
needed changes in Federal information management controls
will not be effected. The bill would greatly strengthen the
hand of 0MB in exercising its broad responsibilities for
improving the management of the Federal Government.
In conclusion, we see enactment of H.R. 6410 as an
important landmark in a concerted effort to establish con-
sistent Federal information policies. The management
structure and tools put into place by this legislation will
assist us in working toward solutions for the many information
problems now existing. We should not, however, deceive our-
selves or others that this legislation represents more than
the beginning of a long and difficult task.
This concludes my prepared statement. We have a number
of technical suggestions for the bill which we will be
happy to discuss with your staff. We shall be pleased to
answer any questions which you or other Members of the Sub-
committee may have.
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Mr. BROOKS. Our next witness is Phil Kiviat. He is with the Wash-
ington office of SEI Computer Services, a computer consulting and
software company.
He is appearing today in his capacity as Task Group Leader for
the President's Federal Automatic Data Processing Reorganization
Project.
Before joining SEI, Mr. Kiviat was Technical Director of the
Federal Computer Performance Evaluation and Simulation Center.
In this capacity, he has assisted the committee on numerous occasions.
It is good to see you again and we are delighted to have you with
us.
Mr. Kiviat is accompanied by Mr. Robbin R. Hough, professor
of economics and management at Oakland University, and Mr.
Alton P. Jensen, who has been with the Georgia Institute of Tech-
nology since 1957. Both Mr. Hough and Mr. Jensen also served on
the President's Data Processing Reorganization Project.
Welcome gentlemen. Mr. Kiviat, your full statement will appear
in the hearing transcript.
You may proceed.
STATEMENT OF PHILIP J. KIVIAT, THE PRESIDENT'S FEDERAL
AUTOMATIC DATA PROCESSING REORGANIZATION PROJECT;
ACCOMPANIED BY ROBBIN R. HOUGH, PROFESSOR OF ECONOMICS
AND MANAGEMENT, OAKLAND UNIVERSITY; AND ALTON P.
JENSEN, GEORGIA INSTITUTE OF TECHNOLOGY
Mr. KivIAT. Thank you, Mr. Chairman.
We appreciate your invitation to be here today to discuss H.R.
6410 from the perspective of the President's Federal Data Processing
Reorganization Project, which studied Federal data processing
intensively from August 1977 through April 1979, when it submitted
its final report to OMB for transmittal to the President.
With me today are Alton P. Jensen of Georgia Tech, who was a
member of the Central Agencies Study Team, and Robbin R. Hough
of Oakland University, who was the Leader of.the Human Resources
Study Team. I served as Leader of the Operational Management
Team.
I would like to submit for the record, in addition to these remarks,
the 10 study team reports, and the final report of the project.
Mr. BROOKS. Without objection, so ordered.
[See appendix C.]
Mr. KIVIAT. Late in 1977, President Carter constituted the Federal
Data Processing Reorganization Project as one of 31 Presidential
reorganization projects. Staffed with 55 professionals recruited from
the private and public sectors, the project team studied planning and
management issues which were felt to be unique to individual operat-
ing agencies, and issues common to all agencies. The project was
divided into 10 teams, each of which prepared a separate report and
contributed to the project's final recommendations.
The 10 teams were: Human Resources, National Security, Small
Users, General Government, Science and Technology, Acquisition,
Operational Management, Standards, Personnel, and Central Agen-
cies-such as OMB, GSA, and NBS.
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H.R. 6410 addresses several of the major concerns with Federal
information technology management expressed by the Federal Data
Processing Reorganization Project.
We are immensely gratified to be able to be here today to present
the project's findings and recommendations and to support passage
of the legislation.
But before I speak to specific issues the bill addresses, allow me to
put the project in some perspective.
For at least 10 years, Federal task forces and committees, the
General Accounting Office, and, at times the public, have been critical
of the way in which the Government plans for and manages data
processing and telecommunications, what the Data Processing Re-
organization Project and many others now call "information tech-
nology." In 1971 a Task Force on "Long-Range Plans for ADP
in the Federal Government" reported to the Interagency Committee
on Automatic Data Processing that "imaginative use of data proc-
essing in management decisionmaking, planning, objectives formula-
tion, course of action selection, resources allocation, and the like, has
barely been touched."
There were years of repeated comments like this, and other
criticisms, such as :
Some uses of computer technology by Federal agencies represent
a threat to individual privacy;
Delays or inaccuracies in computer assisted processing of applica-
tions for Federal assistance, issuance of checks and other transactions
by the Government are increasing; and
Hundreds of millions of taxpayers dollars have been wasted or lost
through mismanagement and misuse of computer resources that
prompted the President to establish the Data Processing Reorganiza-
tion Project.
There was suspicion that despite the wealth of policies, regulations,
and procedures surrounding Federal data processing; despite the high-
level organizations mandated by Public Law 89-306 to oversee and
manage it; and despite the considerable funds being spent-$3.1
billion in fiscal year 1976, the year before the project was initiated;
$5.3 billion estimated for fiscal year 1980-the Nation was not getting
its money's worth, the Government was using its computers in-
effectively, and the situation was getting worse rather than better as
time went by.
For an economy and a Government increasingly dependent on
computers and communications, this situation was alarming, not only
for the waste of resources some claimed was endemic, but for the
opportunities that were being lost to put information technology to
work making Government more responsive to the needs of its citizens,
more efficient, and better able to function in this new computer age
where, for some organizations like the IRS and the Social Security
Administration, the computer is the only way in which a basic function
of government can be carried out.
The reorganization project views information technology as a
critical national resource. It is from that perspective that many of our
recommendations must be viewed.
It was with this background that the project staff went about its
investigation into how the Federal Government uses and manages its
information technology resources.
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Ten study team reports produced many specific findings, con-
clusions, and recommendations. I would like to itemize those that are
relevant to this hearing and which are the most significant of all.
First, the Federal data processing management structure is generally
sound. Most of the teams concluded that the management approach
for computer technology, as envisioned by the Brooks Act, Public
Law 89-306, is generally sound. It is not the law, but rather the im-
plementation of the law, that has been deficient.
Second, data processing problems are symptoms of broader manage-
ment weaknesses. Many of the teams felt that the problems are not
unique to data processing-but are extensions of larger problems in
the management of Federal programs and resources. There was a gen-
eral feeling by all the groups who looked at agencies operations of
widespread mismanagement of Federal resources, and especially the
lack of accountability in the way those resources were used.
Third, top management has failed to get involved. Most of the
teams felt that top management, at all levels of Government, has
failed to recognize the potential benefits of information technology
for improving agency performance, has failed to give data processing
the high level of attention it warrants, and has not involved itself in
decisions regarding its application. The teams found that in many
organizations data processing is viewed as a routine administrative
service, like printing or reproduction, rather than a tool to improve
delivery of services and management of the agencies themselves.
Senior agency managers do not have, nor do they seem to demand,
information systems that will assist them in evaluating and reviewing
agency programs.
Everyone agreed that the application of information technology to
program missions, was the primary responsibility of agency manage-
ment. They did not feel that the managers within the agencies were
exercising this responsibility. Moreover, they found that users of
information technology services, for example, were seldom held
accountable for the effective use of those services, or for the planning
and justification of future use.
Decisions about data processing and communications were seen to
flow up rather than down in the agency hierachy. There were few
measures of mission performance and there were few examples of
management information systems used by agency managers for agency
management.
Fourth, the need to strengthen central leadership. One of the teams
described Federal data processing management as "a ship without a
rudder, or more possibly a ship with 100 rudders." There was a general
consensus that more positive direction and leadership is needed. This
has been a continuing concern of reviewers of Federal ADP manage-
ment. The 1971 IAC/ADP report recommended that "the Office
of Management and Budget should sustain a strong leadership of
other agencies of the executive branch, particularly those with
Government-wide ADP responsibilities * * *" and the 1979 PRP final
report reported, "The Office of Management and Budget should
establish an Office of Information Resource Management [IRM] at
the Executive Associate Director level. The person holding this
position should be given a broad mandate to create and reinforce a
good system of information technoloy management." A senior,
visible executive is needed to signal th'e' Government's concern and
to exercise OMB's authority.
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There was expressed the need to unify the many responsibilities that
were spread across GSA, the Department of Commerce, and OMB,
and again to assign accountability.
Fifth, there is a need for better audit and review mechanisms.
Several teams felt that one of the major deficiencies in the current
system is the lack of timely audit and review mechanisms, especially
within the agencies. As a result, it is not uncommon for the first
indication of problems to come from a GAO audit. Long computer
system acquisition times, often cited as evidence of too rigid a system
of central oversight controls, can also be interpreted as failures of the
intra-agency management process to produce acceptable studies and
procurement documents. Impartial, objective internal agency reviews
by qualified auditors or technical specialists were found to be the
exception rather than the rule.
These were the general findings that the 10 study teams seemed to
agree on.
Specific findings in the areas of national security and human service
delivery were particularly alarming to many people.
One, that our military enterprise is operationally vulnerable as a
consequence of aging equipment and policies that provide little or no
backup to insure reliable operation in the face of emergencies or
disasters; and
Two, where information technology could be dramatically improving
the delivery of human services at all levels-determining eligibility,
measuring performance, compiling data, showing trends, assisting ap-
peals, et cetera-the Federal Government is still attempting to con-
duct these programs with the tools and resources of the 1960's.
The Government was once a leader in data processing. That is no
longer true.
The first finding clearly has to do with Federal ADP management
practices. Questions such as: When should computers be replaced?
What constitutes obsolete technology? What is an unacceptable level
of reliability? Not only are these not answered today, but I question
if there is even an organization clearly responsible for finding answers.
Responsibility bobs like a cork between OMB, GSA, and NBS, and
the agencies, and the public, are the ones that suffer.
The second finding has to do with information technology leadership,
that aspect of management that encourages the use of new technology,
that fosters experimental programs and that sets a general spirit of
"Let us find ways to do it better and/or cheaper" for the organizations
and people that look to the management group for direction.
The finding is alarming in that it seems to point out the need for
executive intervention to stimulate advances in the way the Govern-
ment is delivering basic public services, if the improvements that are
technologically possible today, and should be provided to the public,
are to be made.
The present system is just not doing things that can and should
be done.
The study teams found that agencies need guidance in interpreting
and carrying out policies and regulations, need support when con-
fronting forces opposed to introducing new ideas, or initiating new
technology programs, and need an advocate, in general, of the use of
information technology as a major force in agency program manage-
ment and, more importantly, service delivery.
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The teams also expressed a need for more central management
concern with improving the process of information technology man-
agement, so there could eventually be less central agency regulation
rather than more.
This was to be carried out by applying the concept of earned
autonomy, which establishes procedural rules for carrying out some
function, such as conducting a computer acquisition, and grants oper-
ating autonomy to organizations that can demonstrate the capacity
to manage the function as it was intended.
I cite as an example of this the proposed blanket delegation of
procurement authority to qualified agencies that has been talked about
within GSA but has not materialized.
The study teams also saw a need for a senior central management
that understands that computers are not just glorified typewriters or
adding machines, but timely new tools that offer new alternatives for
carrying out missions and programs and for managing the programs.
An important role of these senior managers would be to carry these
ideas to agency heads and the higher councils of Government. There
is an important advocacy role for this leadership group.
The Office of Information Policy established by H.R. 6410 will be
the managerial focal point called for by the project. The bill will give
a single organization responsibility and resources for interrelated
management elements that have been heretofore separated organiza-
tionally. They are: rulemaking, such as establishing policies, principles,
standards, and guidelines; monitoring the effectiveness of directives;
monitoring compliance with directives; providing technical and budg-
etary guidance; and reviewing and reporting on progress.
The bill takes the critically important step of explicitly assigning
tasks and deadlines to the Office of Information Policy and to the
agencies. It creates accountability. The significant acts of centralizing
agency responsibility and mandating specific review activities will
force a much overdue reexamination of internal agency procedures,
capabilities, and policies, and force some bureaucracies to do jobs they
have avoided doing for years.
H. R. 6410 sets a new direction for Federal information policy. It
adds substance, specificity, and vigor to the present vague, formless,
and aimless ADP management system.
It is interesting to note that several companies today present
rather well-attended courses on how to deal with the complexities of
the Government's ADP procurement process. I have a feeling that
those companies should not find as ready a market for their services as
they do. The Government's internal processes should be clearer, and
it should be able to communicate them to its own employees. H.R.
6410 acknowledges that there is a need and a reason for leadership, and
for unambiguous oversight. It calls for extensive changes in the way
everyday business is done, and in how agencies view themselves and
the central management organizations. It also calls for a rethinking of
the OMB position of strict impartiality which has led at times to
paralyzing detachment, and for a much needed enlargement of the
duties of the "M" side of the OMB house.
All these changes are overdue. They were all recognized by the
President's Data Processing Reorganization Project and the project
offered recommendations concerning them.
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I believe I reflect the sentiments of the Data Processing Reorganiza-
tion Project in saying that the bill furthers the ends advocated by the
project's final report, and that it does so through means consistent
with those the project advocated.
Like all far-reaching reforms, H.R. 6410 will face implementation
difficulties. Radical change is never accepted or instituted easily. But
unless you are satisfied with the status quo, which I am not, or you
are willing to accept the rate at which the Federal Government is
falling behind the private sector in making use of information tech-
nology to control and reduce costs, and to deliver new and improved
services, which I am not, H.R. 6410 must be supported.
I thank you, Mr. Chairman, for the opportunity to testify on this
matter. We will be glad to answer any questions you or the other
members of the subcommittee may have.
Mr. BROOKS. First, I want to thank you for a very fine and well
thought out statement. It is instructive and helpful. It is a good
reflection of the findings of your commission.
We are delighted you think this bill would meet most of the objec-
tives and that you have the concurrence of your other members.
The President's ADP Reorganization Project identified numerous
operational, managerial and technical problems associated with the
way the Government acquires and uses information technology.
In your view, is it possible to resolve these problems without first
strengthening the central management and oversight of these re-
sources by OMB?
Mr. KIVIAT. I do not believe so. There is a required centralization
of responsibility which Mr. Staats commented on. There is a need to
clarify accountability and make accountability visible. There is a
definite need for leadership and advocacy and there is a definite need
for resources within OMB and the agencies to carry out these
functions.
I do not believe those things will happen without the bill.
Mr. BROOKS. Can you cite a specific example where improvement in
an agency's use of information technology would have greatly in-
creased program performance?
Mr. grvrAT. I would like to ask Mr. Hough to answer that.
Mr. HOUGH. The Human Resources Team felt that in the course of
its part of the project it ought to look at a series of, if you will, missed
opportunities or cases where some substantial gains might be made. It
concentrated expecially on the problem of agencies that simply were
not performing some mission that they had been given to carry out in
the way it seemed they might be performing it and asking ourselves,
in essence: Would it be possible to put some of that new technology
in place and produce improved results?
I would cite as a specific example of this kind of problem the black
lung program, which the Congress implemented many years ago and
was pursued with renewed vigor in 1977 shortly after our program
began.
At the time we did our review, the average delay between the time
the initial application might be made for benefits under that act
and the time the benefits were received was 630 days. We saw, as a
result of our work, that they could have automated the registration
process right out in the localities where the applicants were applying
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for benefits. Instead, in fact, paperwork was being a little bit mis-
managed in the field and was coming to Washington and then going
back to the field. There resulted an incredible cycle which eventually
led to delayed times.
We found that pulmonary evaluations that were being routinely
conducted using automated systems in Denver, Houston, and else-
where, could have been introduced and have reduced some of the
problems with providing complete physical examinations.
In general, we came to a number that I think is interesting, given
Mr. Horton's question about the costs of the bill. In one of the es-
timates we made, we concluded that the program was currently
costing $41 million a year to run. Its costs could have been reduced
to $17 million.
A savings of that kind would be enough to implement your b'll.
I called for an update when I learned of your hearing and talked
a bit with Secretary Elisburg. Indeed, automation has not been
introduced on anything near the scale that we suggested. There is
still a very large backlog, though, in point of fact, there has been some
automation introduced in the registration process.
But I think the most poignant story is one which I picked out just
a few moments ago indirectly from one of the Human Resources Team
efforts.
During the course of our study, we felt that we not only needed to
look at some of the technology issues and some of the management
issues, but we needed to get out and see how they affected the Ameri-
can people.
The team went out to Beckley, W. Va. One of the persons whom
the team followed through the process of applying for benefits was
named Samuel Burke.
Samuel Burke passed away just 1 month ago, 1 month after being
declared eligible for black lung benefits.
Mr. BROOKS. How long did it take him to get qualified?
Mr. HOUGH. Just over 2 years.
Mr. BROOKS. There was a decided human impact there.
Mr. HOUGH. Indeed.
Mr. BROOKS. Can you cite any other examples that you think might
be as poignant as the black lung cases? Did you have any others? If
you do, can you give us a little rundown for the record?
Mr. HOUGH. There are a number in different directions. I think one
that substantial strides have been made in, but one in which there is
much to go is the social security disability appeals process.
This is one in which the front-end eligibility determination has been
a quick and rapid process, but it is one in which people are shuffled in
the front door, declared ineligible, go out the back door into an appeals
process, which then takes 2 years.
If my recollection is correct, the life expectancy of the people
appealing is about 3 years.
Mr. BROOKS. Your project has recommended that a central manager
for information resources be created in each agency. Would you give
the subcommittee your views on the benefits of having such an office?
Mr. KIvmT. I would like Pete Jensen to handle this question.
Mr. JENSEN. Working with the central agency groups, we very
strongly advocated a management position very similar to the one
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called for in this piece of legislation. This is in recognition of the fact
that it is important to do more than establish this policy respon-
sibility with OMB.
We feel that it is necessary to establish a mechanism within the
agencies through which the policy can be expedited by OMB. This
comes about as a consequence of one of the central findings of the study
itself, which showed that there is a very clear inability on the part of
top mission managers to manage the technology itself.
We view this as being hopefully an interim position that is necessary
to support these managers until such time-and no telling how long it
will take-for those of us who are in mission management positions,
to become sufficiently aware of the technology and are capable of
making decisions necessary to expedite the policies.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
I want to join with you in thanking Mr. Kiviat and Mr. Jensen and
Dr. Hough for their willingness to serve on this reorganization project.
I know it takes a lot of extra time to serve on this type of project. You
get all wrapped up in it and get a great deal of enthusiasm. When you
make your final report, you are hopeful that the results of your study
are going to be acted upon immediately. Then all of a sudden, because
the Federal Government is a big organization with a lot of bureauc-
racy, nothing happens. Sometimes it gets very discouraging.
So, I am happy also that you are here today to present your views.
I am pleased that this legislation seems to be one of those steps in the
right direction to carry out some of the recommendations that you
made.
I would like to ask you, Mr. Jensen, if you are in accord with the
statements made by Mr. Kiviat?
Mr. JENSEN. Yes, Sir.
Mr. HORTON. How about you, Dr. Hough?
Mr. HOUGH. Yes, sir.
Mr. HORTON. So, both of you agree generally with the statement he
has made about the importance of this legislation.
As you know, OMB recently had a reorganization of its information
offices. Is that change responsive to your reorganization projects'
recommendations regarding the organizational placement of the infor-
mation policy function?
Mr. KivIAT. Actually, while I believe the reorganization is a positive
step, specifically it is not responsive to what we were calling for. What
we asked for was establishment of an office at a senior executive level
in the agency, an executive associate director level, with the under-
standing that someone at that level would be needed to exercise the
clout and have the visibility needed to provide the management
impetus.
In practice, what OMB has done is actually move the level of the
person who has information policy responsibility from a deputy
associate director to a deputy assistant director, or reduced the effec-
tive level of the person who has operating responsibility.
Mr. HORTON. Do you feel the creation of the statutory office as
called for in this bill will meet your concerns about that?
Mr. KivIAT. There is that aspect of it, yes. There are also some other
aspects of the bill that are not present in the OMB reorganization.
One, the OMB reorganization, as I understand it, dilutes rather
than increases the resources that are devoted to information policy
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in that it creates a desk officer situation whereby individuals are given
agency responsibility that span the concerns of the office: Regulatory
policy, paperwork policy, information policy, and the like.
So, rather than having a group of people dedicated to any one
particular function, you now have a group of people with varying
responsibilities. You can never be sure what resources will be assigned
or what the direction will be from year to year or even month to
month.
Mr. BROOKS. You would assume that kind of management would
have input from experts in the components that they are trying to
put in place; would you not?
Mr. KivIAT. I hesitate to make those assumptions.
Mr. BROOKS. You could have an expert.in each area for each
agency. Or, you can go at it with an expert in each agency with some
input in those areas to handle the agency.
Mr. KivIAT. There has always been the question as to whether you
divide things functionally or otherwise. I think in this area there has
been a concern for years that OMB has not had sufficient resources to
handle the information policy functions.
Right now, in one respect, they are allocating even fewer resources
because they are dividing up the people. You can look at it one way
as: Is it better to have 50 generalists with partial responsibility, or 8
specialists with full responsibility?
Mr. HORTON. You bring up another point that may not be directly
involved here, although maybe it is. That is a problem that the Office
of Management and Budget has had, not only in this administration,
but in other administrations, too: The desire to keep within certain
limits personnel- and money-wise.
There is another very important function which must be considered,
too, I think you mentioned in your testimony. That is the function of
management. OMB used to be the Bureau of the Budget. Budget was
one function. Now it is the Office of Management and budget-two
functions.
Principally-and I am oversimplying-OMB devotes too much of
its attention to the budget functions; it has not really given the
management function its due.
It seems to me what we are trying to do in this bill, among other
ways by talking in terms of added resources, is giving more impetus
to management. I think it's important that the general public under-
stand that when we do this, even though we are increasing the size
of the Office of Management and Budget-and this bill will increase
the budget-it will also save literally millions of dollars.
You have given a couple of good examples of savings. Mr. Staats
has given some others. I am familiar with others so far as the paper-
work burden is concerned.
So, we are talking about saving hundreds of millions of dollars by
this type of step.
Would you generally agree with that?
Mr. KIVIAT. Yes, I would.
Mr. HOUGH. The timing which you envision in the bill is superb
on the issue of putting first the definition of the audit standards. It
is an opportunity to put in place performance measurements for
agencies right at the beginning that begin to bring together the kinds
of conceptualizations needed to view the agencies' whole problem from
a managerial point of view.
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Mr. BROOKS. Did you have something to add?
Mr. JENSEN. I think one of our central concerns with regard to this
business is that we are very often talking about OMB establishing
policy. The mechanism for management involves advocacy to follow
through to see that the policy has been expedited.
One of the crucial things that needs to be provided is that
mechanism. One of the things that the PRP report covered was a
necessary feed-back mechanism on mission performance and ac-
countability through the budget process to provide the mechanism
within the OMB for effectively knowing when a program has been
managed and when it is in compliance with the policy and when it is
meeting the standards set forth.
Mr. BROOKS. The OMB has accountability now if they exercise it.
Mr. JENSEN. Yes.
Mr. BROOKS. If I am handling the budget, I can get a report on how
you are doing. It is no problem. All I have to do is tell you we are
waiting for those reports before acting on submitting your budget to
the President. They may work nights, but you will get it. They do not
have to like it, either.
I think Jim McIntyre is doing a good job over there. An OMB
Director, if he wants to, can be a very effective policymaker for
agencies, particularly, and only if he has the full confidence of the
Chief Executive. Otherwise, the agency heads and the department
heads go right around him and go cry and tell the President their
troubles: They do not understand. They moan and sigh. You know
how that goes.
Mr. JENSEN. The majority of our findings and positions were taken
in terms of tenure of an office that was not Mr. McIntyre's. We are
encouraged by his work, too.
Mr. HORTON. I have a lot of respect for Mr. McIntyre and the
job he has done as Director and also for the support he has from the
President.
With regard to paperwork, the President recently signed an Execu-
tive order. Mr. Brooks and I were both present when he did that. I
was very impressed with what the President has done and also what he
proposes to do in that Executive order.
From a bipartisan standpoint, I could not be critical of that at all.
I think he has done an excellent job, and I feel the same way about
what Mr. McIntyre has done.
I was not attempting to criticize. I did not want it to appear that
way at all. I feel that Mr. McIntyre is a very capable person with
regard to the work of the OMB. I was just trying to emphasize that
there is a need for this type of legislation.
The general public is not generally willing to accept budgetary
increases, but this is one of those types of increases, it seems to me,
that is going to save money by spending money.
That is what we do with the GAO. If we got rid of the GAO, we
would save a lot of money, but on the other hand it would cost us a lot
more because they would not do the audits and other things that
result in net cost savings.
Mr. BROOKS. I want to thank you gentlemen for coming down.
We appreciate your testimony, your cooperation, and particularly the
2 years of dedicated effort that you put into the study in an effort
to make the management of the Government better.
[Mr. Kiviat's prepared statement follows:]
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STATEMENT OF
PHILIP J. KIVIAT
SEI COMPUTER SERVICES
SUBCOMMITTEE ON LEGISLATION AND NATIONAL SECURITY
COMMITTEE ON GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
Mr. Chairman and Members of the Subcommittee:
We appreciate your invitation to be here today to discuss H.R.
6410 from the perspective of the Presidents Federal Data Processing
Reorganization Project, which studied Federal data processing
intensively from August 1977 through April 1979, when it submitted
its final report to OMB for transmittal to the President. With me
today are Alton P. (Pete) Jensen of Georgia Tech who was the leader
of the Central Agencies Study Team and Robbin Hough of Oakland
University, who was the leader of the Human. Resources Study Team.
I served as Leader of the Operational Management Team. I would like
to submit for the record, in addition to these remarks, the ten Study
Team reports, and the final report of the Project, plus additional
comments if I feel they will clarify my statement subsequent to this
hearing.
Introduction
Late in 1977 President Carter constituted the Federal Data
Processing Reorganization Project as one of 31 Presidential
Reorganization Projects. Staffed with 55 professionals recruited
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from the private and public sectors, the project team studied
planning and management issues which were felt to be unique to
individual operating agencies, and issues common to all agencies.
The Project was divided into ten teams, each of which prepared a
separate report and contributed to the Project's final recommendations.
The ten teams were:
? Human Resources
? National Security
? Small Users
? General Government
? Science and Technology
? Acquisition
? Operational Management
? Standards
? Personnel
? Central Agencies
H.R. 6410 addresses several of the major concerns with Federal
information technology management expressed by the Federal Data
Processing Reorganization Project. We are immensely gratified to
be able to be hear today to present the Project's findings and
recommendations and to support passage of the legislation. But
before I speak to specific issues the bill addresses, allow me to
put the Project in some perspective.
Background
For at least ten years Federal Task Forces and Committees,
the General Accounting office, and at times the public have been
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critical of the way in which the Government plans for and manages
data processing and telecommunications, what the Data Processing
Reorganization Project and many others now call "information
technology". In 1971 a Task Force on "Long-Range Plans for ADP
in the Federal Government" reported.to the Interagency Committee on
Automatic Data Processing that "imaginative use of data processing
in management decision-making, planning, objectives formulation,
course of action selection, resources allocation, and the like,
has barely been touched." It was years of repeated comments like
this, and other criticisms such as:
? some uses of computer technology by Federal
agencies represent a threat to individual
privacy
? delays or inaccuracies in computer assisted
processing of applications for Federal
assistance, issuance of checks and other
transactions by the Government are increasing
? hundreds of millions of taxpayers dollars
have been wasted or lost through mismanagement
and misuse of computer resources
that prompted the President to establish the Data Processing
Reorganization Project.
There was suspicion that despite the wealth of policies,
regulations, and procedures surrounding Federal data processing;
despite the high-level organizations mandated by PL 89-306 to
oversee and manage it; and despite the considerable funds being
spent ($3.1 billion in FY 1976, the year before the Project was
initiated; $5.3 billion estimated for FY 1980) the Nation was not
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74
getting its money's worth, the Government was using its computers
For an economy and a Government increasingly dependent on
computers and communications, this situation was alarming, not only
for the waste of resources some claimed was endemic, but for the
opportunities that were being lost to put information technology
to work making Government more responsive to the needs of its
citizens, more efficient, and better able to function in this new
computer age where for some organizations, like the IRS and the
Social Security Administration, the computer is the only way in
which a basic function of government can be carried out.
It was with this background that the project staff went about
its investigation into how the Federal Government uses and manages
its information technology resources.
Findings
Ten Study Team reports produced many specific findings,
conclusions, and recommendations. Those that are relevant to this
hearing however, and which are the most significant of all, are:
? The Federal data processing management structure
is generally sound. Most of the teams concluded
that the management approach for computer
technology, as envisioned by the Brooks Act
(P.L. 89-306), is generally sound. It is not the
law, but rather the implementation of the law,
that has been deficient.
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? Data processing problems are symptoms of
broader management weaknesses. Many of the
teams felt that the problems are not unique to
data processing -- but are extensions of larger
problems in the management of Federal programs
and resources.
? Top management has failed to get involved.
Most of the teams felt that top management,
at all levels of Government, has failed to
recognize the potential benefits of information
technology for improving agency performance,
has failed to give data processing the high
level of attention it warrants, and has not
involved itself in decisions regarding its
application. The teams felt that in many
organizations data processing is viewed as a
routine administrative service like printing'
or reproduction, rather than a tool to improve
delivery of services and management of the
agencies. Senior agency managers do not have,
nor do they seem to demand, information systems
that will assist them in evaluating and reviewing
agency programs.
? Need to strengthen central leadership. One of
the teams described Federal data processing
management as "a ship without a rudder, or
more possibly a ship with 100 rudders." There
was a general consensus that more positive
direction and leadership is needed. This has
been a continuing concern of reviewers of
Federal ADP management. The 1971 IAC/ADP report
recommended that the Office of Management and
Budget should sustain a strong leadership of
other Agencies of the Executive Branch,
particularly those with Government-wide ADP
responsibilities .." and the 1979 PRP final report
reported'"The Office of Management and Budget
should establish an Office of Information Resource
Management (IRM) at the Executive Associate
Director level. The person holding this position
should be given a broad mandate to create and
reinforce a good system of information technology
management." A senior, visible executive is needed
to signal the Government's concern and to exercise
OMB's authority.
mechanisms. Several teams felt that one of the
major deficiencies in the current system is the
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lack of timely audit and review mechanisms,
especially within the agencies. As a result,
it is not uncommon for the first indication of
problems to come from a GAO audit. Long computer
system acquisition times, often cited as evidence
of too rigid a system of central oversight controls
can also be interpreted as failures of the intra-
agency management process to produce acceptable
studies and procurement documents. Impartial,
objective internal agency reviews by qualified
auditors or technical specialists were found to
be the exception rather than the rule.
? Our military enterprise is operationally
vulnerable as a consequence of aging
equipment and policies that provide little
or no backup to insure reliable operation
in the face of emergencies or disasters.
? Where information technology could be
dramatically improving the delivery of
human services at all levels (determining
eligibility, measuring performance, compiling
data, showing trends, assisting appeals, etc.)
the Federal government is still attempting to
conduct these programs with the tools and
resources of the 1960's.
The first finding clearly has to do with Federal ADP management
practices. Questions such as: When should computers be replaced?
What constitutes obsolete technology? What is an unacceptable level
of reliability? not only are not answered today, but I question if
there is even an organization clearly responsible for finding
answers. Responsibility bobs like a cork between OMB, GSA and NBS,
and the agencies, and the public, are the ones that suffer.
The second finding has to do with information technology leadership,
that aspect of management that encourages the use of new technology,
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that fosters experimental programs and that sets a general spirit
of "lets find ways to do it better and/or cheaper" for the
organizations and people that look to the management group for
directions.
The finding is alarming in that it seems to point out the need for
executive intervention to stimulate advances in the way the
Government is delivering basic public services, if the improvements
that are technologically possible today, and should be provided to
the public, are to be made.
The Study Teams found that agencies need guidance in
interpreting and carrying out policies and regulations, need support
when confronting forces opposed to introducing new ideas, or
initiating new technology programs, and need an advocate, in general,
of the use of information technology as a major force in agency
program management and service delivery. The Teams also expressed
a need for more central management concern with improving the
process of information technology management, so there could
eventually be less central agency regulation. This was to be
carried out by applying the concept of Earned Autonomy, which
establishes procedural rules for carrying out some function, such
as conducting a computer acquisition, and grants operating autonomy
to organizations that can demonstrate the capacity to manage the
function as it was intended. The Study Teams also saw a need for a
senior central management that understands that computers are not
just glorified typewriters or adding machines, but timely new
tools that offer new alternatives for carrying out missions and
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programs and for managing the programs. An important role of these
senior managers is to carry these ideas to agency heads and the
higher councils of Government.
Relation of the Project to H.R. 6410,
The Office of Information Policy established by H.R. 6410
will be the managerial focal point called for by the Project. The
bill will give a single organization responsibility for interrelated
management elements that have been heretofor been separated
organizationally:
? Rulemaking, eg. establishing policies,
principles, standards and guidelines
? Monitoring the effectiveness of directives
? Monitoring compliance with directives
? Providing technical and budgetary guidance
? Reviewing and Reporting
The bill takes the critically important step of explicitly
assigning tasks and deadlines to the office of Information Policy
and to the agencies. The significant acts of centralizing agency
responsibility and mandating specific review activities will force
a much overdue reexamination of internal agency procedures,
capabilities, and policies, and force some bureaucracies to do jobs
they have avoided doing for years.
Conclusion
H.R. 6410 sets a new direction for Federal information policy.
It adds substance, specificity, and vigor to the present vague,
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79
formless, and aimless ADP management system. It acknowledges that
there is a need and a reason for leadership, and for unambiguous
oversight. It calls for extensive changes in the way everyday
business is done, and in how agencies view themselves and the
central management organizations. It also calls for a rethinking
of the 0MB position of strict impartiality which has led at times
to paralyzing detachment, and for a much needed enlargement of the
duties of the "M" side of the 0MB house. All these changes are
overdue. They were recognized by the Data Processing Reorganization
Project and the Project offered recommendations concerning them.
I believe I reflect the sentiments of the Data Processing
Reorganization Project membership in saying that the bill furthers
the ends advocated by the Project's final report, and that it does
so through means consistent with those the Project advocated.
difficulties. Radical change is never accepted or instituted
easily. But unless you are satisfied with the status quo, which
I am not; or you are willing to accept the rate at which the Federal
Government is falling behind the private sector in making use of
information technology to control and reduce costs, and to deliver
new and improved services, which I am not, H.R. 6410 must be supported.
I thank you, Mr. Chairman, for the opportunity to testify on this
matter. We will be glad to answer any questions you or the other
members of the Subcommittee may have.
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Mr. BROOKS. Further hearings on the Paperwork Reduction Act
of 1980 will be scheduled later this month.
I yield to Mr. Horton for a motion.
Mr. HORTON. Mr. Chairman, due to the sensitive subject matter
to be considered at the subcommittee hearings to be held between
February 10 and February 18, I move that those hearings be closed.
Mr. BROOKS. All those in favor, say aye.
[Chorus of ayes.]
Mr. BROOKS. Opposed, nay.
[No response.]
Mr. BROOKS. The ayes have it and the motion is agreed to.
This hearing is now adjourned, subject to the call of the Chair.
[Whereupon, at 10:58 a.m., the subcommittee adjourned, to re-
convene subject to the call of the Chair.]
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
PAPERWORK REDUCTION ACT OF 1980
HOUSE OF REPRESENTATIVES,
LEGISLATION AND NATIONAL SECURITY SUBCOMMITTEE
OF THE COMMITTEE ON GOVERNMENT OPERATIONS,
Washington, D.C.
The subcommittee met, pursuant to notice, at 9:35 a.m., in room
2154, Rayburn House Office Building, Hon. Jack Brooks (chairman
of the subcommittee) presiding.
Present: Representatives Jack Brooks, Elliott H. Levitas, and
Frank Horton.
Also present: Eugene F. Peters, staff director; William M. Jones,
general counsel; Elmer W. Henderson, senior counsel; Cynthia
Meadow, professional staff member; James E. Lewin, professional staff
member; Linda Shelton, office manager; Mary Oliver, secretary; and
Stephen M. Daniels, associate minority counsel, Committee on Gov-
ernment Operations.
Mr. BROOKS. The subcommittee will come to order.
Today, we continue our hearings on H.R. 6410, the Paperwork
Reduction Act of 1980.
In our February 7 hearing, we heard testimony from Comptroller
General Staats and representatives of the President's ADP reorganiza-
tion project in support of this legislation.
General Staats testified that H.R. 6410 would consolidate currently
fragmented information policy and oversight functions in OMB and
would result in substantial improvement of Federal information
management activities.
Mr. Phil Kiviat, representing the ADP reorganization project,
testified that the bill addressed several of the major concerns with
Federal information technology management expressed by the project
team. Mr. Kiviat also said that H.R. 6410 would provide for a much
needed enlargement and support of the duties of the management
side of OMB which the project team believes is long overdue.
Our first witness today is Mr. Don Alexander, vice chairman of the
Citizens Committee on Paperwork Reduction. He was a member of
the Paperwork Commission. From 1973 to 1977 he was Commissioner
of the Internal Revenue Service. He now practices law in Washing-
ton, D.C.
We welcome you, Mr. Alexander.
You may proceed.
(81)
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82
STATEMENT OF DONALD C. ALEXANDER, VICE CHAIRMAN, CITI-
ZFNS COMMITTEE ON PAPERWORK REDUCTIOI7; ACCOMPANIED
BY JOHN M. CROSS, EXECUTIVE VICE PRESIDENT
Mr. ALEXANDER. Thank you, Mr. Chairman.
With me is John Cross, the executive vice president of the Citizens
Committee on Paperwork Reduction, which is a nonprofit group
dedicated to the reduction of all Government paperwork.
It helps implement the recommendations of the Commission on
Federal Paperwork, on which I was privileged to serve under the
chairmanship of Congressman Horton, who did an exemplary job
for the people of the United States in trying to control the burden of
paperwork.
I have been involved, of course, in creating much paperwork as well
as trying to control it. I served as Commissioner of Internal Revenue
for almost 4 years, and perhaps inflicted more of the burden on the
American public than any of the witnesses that you mentioned before
who would be testifying before you.
I come here, Mr. Chairman, to testify strongly in favor of rapid
passage of H.R. 6410, the 1980 Paperwork Reduction Act.
I want to compliment you and Congressman Horton and all those
who have worked on this bill. It is an important piece of legislation.
The sooner you get it passed, the better.
The people of the United States are angry about papework. They
are sick and tired of filling out forms and anyone who is unaware of this
should have been at the White House Conference on Small Business
recently when the anger was made painfully clear to all of us who were
acting as the official and semiofficial representatives on that program.
The chairman of our committee, Ed Richard, a Cleveland business-
man, who was unable to be here today, believes he spends more on
paperwork than he does on research and development.
One of the members of our citizens committee runs a million dollar
furniture company with only 11 employees. He found that he spent
about $3,800 annually on unnecessary and irrevelant paperwork.
What do we do about this situation? Your bill is a strong beginning
in updating the outdated 1942 Federal Reports Act in giving the
Office of Management and Budget some management teeth in coping
with the paperwork burden.
We hope, when you consider this bill further, and I trust obtain its
passage, that you will not impose a burden on an agency that I had a
little connection with, that is, that the agency cannot bear, unless
there is a power to delegate, as found on page 19 of H.R. 6410.
Then, some impossible problems would be created for the Internal
Revenue Service and the American taxpayer. If a taxpayer pays late
in the year, and if you change the rules, particularly on the even years,
then there is no way that the IRS can get its form to the printer and
out to the public in time for the public to meet their responsibilities, if
OMB is not permitted to delgate its responsibilities, assuming that
OMB will not abdicate its responsibilities.
Abdication, as a practical matter, in order to meet the emergencies
that so frequently arise in even years in our tax system, should be
avoided by giving permission and the authority to delegate and to
delegate in a sensible way to someone capable of exercising authority
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
soundly and to delegate in a way that permits OMB to review that
IRS has not gone too far.
Originally I was hoping-and speaking personally and not for the
citizens committee-that IRS could be exempted from this bill.
I have' changed my mind. One of the reasons is that which dealt
with the 1973 forms where the IRS was acting on behalf of another
agency in collecting a lot of revenue-sharing information for the Ameri-
can taxpayers, including some information that taxpayers could not
supply because they did not know what township they lived in.
We managed to get that off a later form, but it was a real struggle.
Mr. BROOKS. That is a sensitive subject for me.
Mr. ALEXANDER. Yes, I heard you had an interest in revenue
sharing.
I shared that interest to the extent of the paperwork burden.
Mr. HORTON. Excuse me, Mr. Alexander.
I recall that in this very room that we had a whole day's hearing on
this subject of the forms of the IRS. I thought it was very helpful so
far as the work of the Paperwork Commission was concerned.
Mr. Chairman, the witness was very cooperative as the Commis-
sioner of the IRS. The IRS cooperated in connection with that hearing.
It made possible IRS getting out an important report with regard to
the problems of paperwork in the IRS. The witness made a tremendous
contribution, not only as the Commissioner of IRS, but more im-
portantly, as a member of the Federal Paperwork Commission itself.
I was reminded of that when you were testifying. At the Paperwork
Commission hearing, the forms were shown to us, and we were told
about the difficulties you incurred when you tried to add new informa-
tion to the forms and what amount of paperwork that generated. It was
a tremendous amount.
Mr. ALEXANDER. Yes, we had that big wall pretty well covered with
paper, as I remember. It is almost impossible, but not with the paper
generated by the IRS. When you get above 20 feet, it might have been
difficult on that way.
That is why IRS needs to stay under the overall supervision of
paperwork management assigned properly so in this bill to the Office
of Management and Budget. That is the place to put it.
I am talking about having that with the right in OMB to delegate
when the delegation is necessary, given the need to put out tax forms
promptly that fairly reflect the law and the fact that we find that to be
a very difficult undertaking when year-end tax laws are passed.
We have a few suggestions, Mr. Chairman, with respect to the bill.
We believe that it might be improved by having a specific definition
of information. We find such a definition in the new OMB regulations
implementing the President's Executive Order 12174.
We think there may be a problem with the rule of 10, which is on
page 4 of the bill. We find major difficulties with the rule. Some agen-
cies may be engaged in a little games playing, which is not unknown in
the executive branch. There are nine requests for information. You
avoid the rule of 10 that way.
Therefore, you might consider broadening the definition of collection
of information in order to eliminate the chances of this happening.
Finally, you might consider adding the mention of training programs
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and education for clearance offices. In addition, the delegation provi-
sion on page 19 of the bill might be modified, to some extent, both to
maintain the limits that should properly be placed on it, but to make
it workable in an agency like IRS.
We will be glad to work with staff, Mr. Chairman, in connection
with the small matters. We urge speedy passage of this fine piece of
legislation.
I would like to insert in the record at this point a listing of our
board of trustees and associate trustees.
Mr. BROOKS. Without objection, so ordered.
[The material follows:]
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Governor Victor L. Atiyeh,
Oregon
Ray T. Bailey, National Small
Business Association
Mary Keith Ballantine
State Representative, Michigan
Derek Bok, President,. Harvard
University
Bernard S. Browning, President
General Business Services
Manuel Caldera, President, Amex
Systems, Inc.
Chairman, Latin American
'Manufacturers Assn.
Fred M. Crosby, President
Crosby Furniture; Chairman
Minority Economic
Development Corporation
Dolores S. Delahanty, Chair
National Women's Education
Fund
James L. Hayes, President
American Management
Association
Louis Heimbach, County
Executive, Orange County,
New York
John W. Kauffman, President
Medical Center at Princeton,
N.J.
Melvin Arnold, Exec. Vice
President, Eaton Corp.
Harry Austin, President
Austin Co.
Harvey Cohen, President
Flint Industrial Supply
Richard L. Conover, President
Capital Consultants
Theodore M. Fainstat, M.D.
Jacob J. Graham, M.D.
James Guest
Sec. of State, Vermont
Carolyn Hatfield
Union of Utah Nurses
Allen C. Homes, Esq.
William M. Jones, President
Cleveland Machine Controls
Edward H. Richard
Chairman
President, Magnetics
International
Donald C. Alexander, Esq.
Vice Chairman,
Former IRS Commissioner
Morgan, Lewis & Bockius
Gerald W. King, Vice President
Jefferson-Pilot Broadcasting
Herbert J. Lerner
Partner, Ernst & Whinney
Cornell C. Maier, Chairman &
CEO, Kaiser Aluminum &
Chemical Corp.
Richard McCoy, Partner
Colley-McCoy Co.
Thomas J. McIntyre, Esq.,
Former Senator &
Co-Chairman, Paperwork
Commission;
Sullivan & Worcester
Governor William G. Milliken,
Michigan
Robert M. Pippitt
Senior Vice President
Xerox Corporation
Derald H. Ruttenberg, CEO
Studebaker-Worthington, Inc.
Daniel F. Slade, Smaller.
Business Association of
New England,
Governor Joseph P. Teasdale,
Missouri
R. David Thomas, Chairman
Wendy's International
Mayor George V. Voinivich,
Cleveland, Ohio
Carolyn Warner, Superintendent
Arizona Public Schools
Charles R. McDonald, President
McDonald Equipment Co.,
Member Pay Advisory Committee
Ralph Murray, President; IDL Ltd.
Patrick S. Parker, Chairman
Parker Hannifin Corp.
Joseph H. Persky, Esq.
Jesse Reel, Administrator
Phoebe Putney Memorial
Hospital
Jack Steele, Dean, Business
School, University of Southern
California
Dean Treptow, President
Brown Deer Bank
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Mr. BROOKS. I want to thank you very much.
Let me ask a couple of questions.
You testified in favor of strong oversight of all agencies, including
the IRS. Does the management responsibility assigned to the central
office of OMB under the bill, in your judgment, provide sufficient
authority over the agency information activities?
Mr. ALEXANDER. Yes.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
I want to take this occasion to welcome Mr. Alexander to the
hearing. I want to thank you for your testimony, and also I want to
thank you for serving as vice chairman of the Citizens Committee on
Paperwork Reduction.
The Citizens Committee was formed after the Paperwork Com-
mission completed its work in October 1977. Incidentally, that was on
time. We were scheduled to start, and we did start, in October 1975.
Then we concluded our work right on schedule, which was 2 years
later, October 1977.
Let me say this so that we have it in the record. The Paperwork
Commission did, in its work, cover a great part of the country in order
to get information. It made a number of recommendations, some 770,
of which about 60 percent, as I recall, have been acted upon favorably.
This has resulted in millions of dollars of savings per year.
More importantly, the Commission finished its work on time and
then turned back over $1 million, which was unheard of in the history
of commissions. Usually commissions want to extend their time. They
end up with a budgetary deficit and have to come back to the Congress
to get more money.
I want to commend you, Mr. Alexander, for the work you did
there. I also want to commend you for the work you are doing with
the Citizens Committee, which was formed to follow up the work of
the Paperwork Commission to make certain that its recommendations
were carried out.
Subsequent to October 1977 there has been much attention placed
on the subject of paperwork reduction by the administration. I want
to give them very high marks for what they are attempting to do to
reduce paperwork. But as you know, the paperwork burden continues
even though a lot has been done. There remains a lot to be done.
This bill is an important step in that direction. It carries out the
recommendations in the legislative field that the Commission made.
It seems to me that it is very important that we enact this bill in this
Congress and do it as quickly as we can. I think it will save literally
hundreds of millions of dollars if we can get this bill through and get
it into operation.
I appreciate your testimony and what you have had to say. It has
been helpful. The most important thing I would like to underscore is
this: As a former Commissioner of the IRS, you have indicated that
you feel there ought to be some sort of a check, or rein, if you will, on
the IRS. This bill imposes that check in a modest way.
If you would like to say anything further, you may.
Mr. ALEXANDER. You have expressed my views very well, Mr.
Horton. I think the Paperwork Commission, under your leadership,
did a splendid job. It is a job that is incomplete, and it will never be
complete. This is a never-ending problem.
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There are new demands on information. Agencies must meet those
demands. Agencies try to meet those demands sensibly and reasonably,
but they view them from the standpoint of the mission as they under-
stand it of their agency.
There needs to be overall direction and overall responsibility. It
should be placed in OMB.
The IRS needs to have a limited authority to act when prompt
action overrides the need for careful review by an outside agency, but
IRS needs to have that outside agency having the authority to review
and the authority to revoke and reconsider its delegation.
Otherwise, IRS may well become confused about what it perceives
to be its need for particular information and the cost of obtaining that
information, which is imposed upon the American public.
It may view one rather heavily and ignore the other, irrespective of
the desire of the present Commissioner, who is a fine person, and the
desires of his staff, to take the paperwork burden imposed by IRS
into account.
So, I believe there should be no exception. But there should be, and
must be, a right to delegate.
Mr. HORTON. Thank you.
Mr. Chairman, I would also like to acknowledge the presence of
John Cross. During the course of the time that the Commission was
working, he was assistant to Senator Thomas McIntyre of New
Hampshire. Senator McIntyre was a member of the Commission and
made a valuable contribution to it. Mr. Cross was his special assistant
and worked with the Commission. He has a great bit of knowledge
about this because he had a lot of input. I am especially appreciative
of his work as executive director of the Citizens Committee. I am glad
that we have him here with us today.
Thank you, Mr. Chairman.
Mr. BROOKS. Gentlemen, we want to thank you.
[Mr. Alexander's prepared statement follows:]
PREPARED STATEMENT OF DONALD C. ALEXANDER, VICE CHAIRMAN, CITIZENS
COMMITTEE ON PAPERWORK REDUCTION
My name is Donald Alexander and I am vice chairman of the Citizens Commit-
tee on Paperwork Reduction, a non-profit group dedicated to the reduction of all
government paperwork. We have membership from most sectors of the American
public and business. I have appended a list of our board of trustees and associates
to this statement.
I have had long involvement with the paperwork reduction programs of the
Federal Government. I served as the Commissioner of the Internal Revenue
Service for almost four years and was a member of the Commission on Federal
Paperwork.
I have come here today to testify in favor of rapid passage of H.R. 6410, your
bill, the 1980 Paperwork Reduction Act. I want to compliment you, Congressman
Horton, who served as chairman of the Paperwork Commission, and all others who
have worked on this bill. It is an important piece of legislation and from the
standpoint of the private, non-Federal sector, a long overdue reform.
The people of the United States are angry about paperwork. They are sick and
tired of filling out forms. This was made emphatically clear to all of us who were
at the recent White House Conference on Small Business.
The Chairman of the Citizens Committee, Ed Richard, a Cleveland, Ohio,
businessman, estimates that he spends more on government paperwork, than he
does on research and development.
You and I know that the Commission on Federal Paperwork estimated the cost
of government paperwork at $100-billion per year. That estimate was probably
high then, though it may not be now. More recently, the U.S. Small Business
Administration estimated that the costs of government paperwork on a small
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business is $1.270. That, you know, is way low. A quick check with one of our
members, who runs a $1-million furniture company, with 11 employees, shows
that he spends about $3,800 doing just government paperwork which relates not
at all to his business.
So, given that we are in a mess, what do we do about it? Your bill is a begin-
ning-a strong first legislative step. It updates the 1942 Federal Reports Act,
which was admittedly out of date when it passed, according to the reports I read
of it. It puts some management teeth into the Office of Management and Budget.
It makes Congress responsible for much of the paperwork burden it creates.
We strongly support this bill. We hope that you will move forward with it
quickly. We also hope, though, that you will not bog down the agencies which have
a successful control mechanism (such as my own favorite, the IRS) in the OMB's
existing 60 day clearance process. IRS people who design the forms have enough
problems already every two years when Congress changes the laws, usually late
in the year, and makes their forms obsolete. These problems would be exacerbated
if the forms were stuck in OMB at the end of November with a print date of
October 1.
On the other hand, we do need to have strong oversight of all agencies, including
the IRS, to make sure that projects to reduce paperwork continue. Clearly,
there is a need for change. This bill will do it. Former Senator McIntyre said
when he testified on the Senate side on similar legislation, "We have to have
somebody who can say, 'No Mr. Secretary, you can't have that information.'
There are just a few points that I would like to stress for the record.
First, we find no definition of information in the bill. We recommend that such
a definition be included. It exists in the new OMB regulations implementing the
existing Federal Reports Act, and the President's new Executive Order 12174.
Second, there is no mention of the Rule of 10. We would urge that that rule
either be mentioned in the definition or be mentioned in the report to accompany
the bill that the rule has been abolished. We have heard, by the way, of major
problems with the rule-agencies submitting nine requests for information which
are copious, thereby avoiding the Rule of 10 and the paperwork clearance process.
Third, there is not mention of training programs and education for clearance
offices in this version of the bill. Such mention occured in previous versions and
you may wish to reconsider reinserting them. Professionalization of the clearance
process would encourage more interest and develop expertise over the long run.
The Citizens Committee stands ready to help with whatever further work is
necessary on this bill. As a former member of the Commission on Federal Paper-
work, let me stress that it is worth all your efforts to cut down the paperwork
burden.
Mr. BROOKS. Our next witness is Wayne Granquist, Associate
Director for Management and Regulatory Policy, Office of Manage-
ment and Budget.
He has been with the OMB since 1977 and is responsible for their
oversight of Federal management and regulatory practices. He
managed the President's cash management improvement project,
which resulted in annual savings of $400 million in interest on the
Federal debt. That is pretty significant.
He now chairs the White House Legislative Task Force on Regula-
tory Reform. We are delighted to have you here. You are accompanied
by Jim Tozzi, Assistant Director for Regulatory and Information
Policy, OMB.
You may proceed.
STATEMENT OF WAYNE G. GRANQUIST, ASSOCIATE DIRECTOR FOR
MANAGEMENT AND REGULATORY POLICY, OFFICE OF MANAGE-
MENT AND BUDGET; ACCOMPANIED BY JIM J. TOZZI, ASSISTANT
DIRECTOR FOR REGULATORY AND INFORMATION POLICY
Mr. GRANQUIST. Thank you, Mr. Chairman.
I am accompanied by Jim Tozzi, who is Assistant Director for Regu-
latory and Information Policy at the OMB.
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We appreciate this opportunity to testify on H.R. 6410, the Paper-
work Reduction Act of 1980. This important piece of legislation
addresses two significant problems : The burden imposed on the public
by the Federal reporting and recordkeeping requirements; and the
effective management of information by Federal departments and
agencies.
For too long the Federal Government has imposed reporting and
paperwork requirements on the public without considering the costs
associated with those requirements.
Similarly, for over 100 years the Government has collected and
managed information as though it were a free good. The time has come
when we must recognize that there are costs associated with infor-
mation-both to the provider and the user-and the impact of those
costs on our economy is just as rea'. and significant as the expenditures
reported in the budget of the U.S. Government.
Reducing the paperwork burden imposed on the public by Federal
agencies and improving the management of Federal information are
two important goals of this administration. As President Carter said
in his state of the Union message on January 24, 1980: "We will con-
tinue our successful efforts to cut paperwork and dismantle unneces-
sary Government regulations."
I believe the record clearly shows that we have made substantial
progress toward achieving those goals. However, further progress will
be difficult unless there are significant changes in the laws and author-
ities governing Federal information activities.
First, we must close the existing statutory loopholes which diminish
our authority to review Federal paperwork activities. Currently almost
81 percent of the Federal paperwork burden is exempt from OMB
review. Without the authority to review the reports and forms required
by the independent regulatory commissions and associated with tax,
education, and health manpower programs, there is little we can do to
reduce the public burden imposed by these requirements.
Second, we must strengthen the Federal Reports Act by centralizing
the oversight of Federal reporting requirements in a single organization.
In addition, members of the public should not have to fill out reports
and forms which have not been properly reviewed and cleared.
Finally, there should be a clearly identified focal point for overseeing
Federal information activities and assuring the development of
necessary Government-wide policies and procedures. Without the
consolidation of Federal information policy responsibilities in a single
organization, we will continue the disjointed and fragmented approach
of the past.
The Paperwork Reduction Act of 1980 is important because it will
accomplish these three objectives. I would like to briefly describe our
accomplishments to date and how we will use H.R. 6410 to expand
upon those efforts.
During the first 2 years of the Carter administration, we have
reduced by almost 15 percent the reporting burden levied by Federal
agencies subject to the President's paperwork reduction program.
We have implemented more than half of the 520 recommendations
directed to the executive branch by the Commission on Federal
Paperwork.
The most important accomplishment to date, however, is the issu-
ance of Executive Order 12174 last November. For the first time,
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agencies are required to prepare and submit a paperwork budget to
the Office of Management and Budget. OMB will review these budgets
and establish a paperwork allowance for each agency.
In addition, this order endorsed the concept of a Federal information
locator system as a tool for eliminating unnecessary duplication in
Federal information collection requests and directed OMB to initiate
developments of such a system. We have now completed our tests of
such a system and are preparing to move forward.
We have also taken steps to improve the management of Federal
information. We have attacked this problem on two fronts.
First, we have worked to improve the management of the technology
by which we process and maintain information. For example, early in
this administration, the President consolidated Federal computer and
telecommunications policy in OMB to provide the necessary organiza-
tional framework to develop effective and coherent policies for
managing these converging technologies.
We have also significantly improved the processes by which we
budget and plan for information technology. An important product
of this initiative has been the publication of agency 5-year plans for
major information technology acquisitions to provide the Congress,
private industry, and other agencies better and earlier visibility of
these plans.
We have developed and issued a Federal policy to insure that
agencies adequately design and appropriately protect their automated
information systems.
I am pleased to note that private industry and some State and
foreign governments have requested copies of this policy for possible
implementation in their own organizations. We have sponsored a
number of conferences for senior managers to discuss the management
of information technology and identify new opportunities for using
technology effectively. We have revitalized and substantially increased
funding for the Federal computer standards program.
Finally, we recently identified and publicized over 80 examples of
how Federal agencies are using information technology to improve
the delivery of public services and the management of Federal pro-
grams. These examples provide documented evidence of how tech-
nology is being used to save millions of dollars annually and recognizes
those agencies who are using technology effectively.
There is a second important dimension to information management
that we are also addressing: the management of information itself.
We have initiated action to improve access to information about
ongoing Federal research by directing the Department of Commerce
to develop and maintain a data base of such information.
As a result of the President's domestic policy review on industrial
innovation, we have initiated action to improve U.S. access to foreign
technical data and research.
Finally, we are now working to implement the recommendations of
the President's privacy initiative. These efforts will strengthen Federal
agency administration of the Privacy Act of 1974, and, with Congress
concurrence, extend the principles of privacy protection to certain
elements of the private sector.
The record clearly demonstrates this administration's continuing
commitment to addressing these two important problems : The paper-
work burden on the public and the management of Federal
information.
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At the same time, as we strive to reduce the reporting burden and
improve the management of Federal information, we must recognize
that the majority of information held by the Government has been
collected or created for legitimate purposes consistent with the role
of the Government in our society.
There is much we can and are doing to improve the processes by
which we collect and manage information. However, in attempting to
manage those processes, we must guard against going so far that we
impede the accomplishment of governmental functions and missions.
Decisions about information must be made in the context of pro-
grammatic need. To be effective, Federal information policies should
not-and cannot-be developed and implemented in isolation from
the agency programs which require information.
Our greatest safeguard against this danger is to assure that com-
peting interests and concerns are appropriately integrated and bal-
anced. This is a difficult, but not an impossible, task.
Over the past 3 years we have made significant progress in improving
the collection and management of information by the Federal Govern-
ment. We have also learned two important lessons.
The first lesson we have learned is that further significant progress
in improving Federal information activities will result only from joint
executive and legislative action. We have used all the tools at our
disposal to reduce the Federal reporting burden and improve the
management of Federal information.
It is now up to the Congress to replenish our arsenal and provide
us with additional tools for tackling these important problems.
We believe that legislation such as H.R. 6410 will accomplish that
objective.
Second, we have become much more cognizant of the relationship
between Federal regulations and the reporting burden imposed on the
public. We estimate that over one-half of total Federal nontax report-
ing is based on the need to insure compliance with laws or regulations.
If we are to reduce that burden, we must establish a mechanism for
managing the regulatory process. Executive Order 12044, which was
signed by the President in March 1978, provides such a mechanism
by establishing a framework for regulatory management which, with
OMB oversight, has generated signficant improvements in the proc-
esses by which we develop and implement regulations. [See app. F.]
In developing a unified approach to managing the burden imposed
by Federal paperwork and regulations, we recognized that a reahne-
ment of existing policy oversight responsibilities was desirable.
As I mentioned a moment ago, the Government collects information
to carry out its various missions and programs.
It became clear that improved management of the information
already held by the Government is an integral part of our efforts to
reduce the burden imposed on the public by Federal information
requirements. To the extent we collect better information, and use it
more efficiently, we can reduce the amount of information the public
must provide.
To accomplish this goal requires an organization which has a
Government-wide perspective and can objectively balance competing,
and sometimes conflicting, interests-such as program and societal
needs, burden on the public, privacy, and budget impact. We believe
that the Office of Management and Budget is the one organization
that can accomplish this task.
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An additional advantage is that improving the management of
Federal information is not a controversial issue. As career staff to the
President, OMB can provide the objective analysis and policy over-
sight needed to improve the processes by which we collect and manage
information.
Accordingly, we have established the position of Assistant Director
for Regulatory and Information Policy, occupied by Mr. Tozzi. Mr.
Tozzi, who will be assisted by a staff of approximately 45 people, is
responsible for overseeing the regulatory, reports and information
activities of the executive branch to assure that agencies collect only
that information necessary for mission accomplishment and that we
use and manage that information efficiently and effectively.
Each staff member has been assigned responsibility for a particular
Federal agency and will work with that agency to improve their in-
formation management activities.
In addition, each staff member will share in the Assistant Director's
responsibilities to develop Government-wide policies affecting regula-
tory, reports and information activities. This realinement of re-
sponsibilities will permit us to develop effective Government-wide
policies and to assure appropriate implementation of those policies
within each Federal agency.
A second benefit is that each Federal agency will now have a single
point of contact within OMB for these closely related issues; no longer
will agencies have to contact a number of different individuals for
guidance.
While this new organization will assist in carrying out our current
responsibilities, it will also permit us to effectively implement the
objectives of legislation such as H.R. 6410.
Specifically, it is our intention to concentrate on the development
of Government-wide policies and on the evaluation of agency per-
formance in implementing those policies. This is the approach we have
taken in implementing Executive Order 12044 and we have found it
very effective.
Our paperwork budget is also based on the principle of delegation-
we will establish a paperwork allowance within which agencies may
determine their specific requirements. It is our intention to avoid
processing the day-to-day transactions, such as report clearances,
technology procurement requests, and individual regulations.
A transaction-oriented workload would require a substantial in-
crease in workload and diminish our ability to focus on the develop-
ment and implementation of Government-wide policies.
For this reason, we intend to delegate the responsibility for such
transactions to the agencies themselves with our oversight and evalua-
tion. Our efforts to date indicate that this approach can be successful.
Although we intend to delegate operating responsibility, we will not
delegate our oversight responsibility. We will establish guidelines to
assist agencies in carrying out their responsibilities and selectively
monitor agency performance to assure that they are adequately
implementing the policies and procedures we have established.
We believe this is the optimum approach for implementing all the
provisions of H.R. 6410.
Earlier I mentioned three things that are necessary if we are going
to further reduce the Federal paperwork burden on the public and
improve the management of Federal information. We must close the
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loopholes in our authority to oversee Federal paperwork activities;
we must strengthen the Federal Reports Act; and, finally, we must
clearly establish a single organization, OMB, to provide overall co-
ordination and direction in the development of Federal information
policies and procedures.
We must also have congressional endorsement of the Federal infor-
mation locator system to assure the success of that effort.
We support those provisions of H.R. 6410 that will accomplish
these objectives. We do, however, have some reservations.
First, we believe that those provisions of the bill which assign
statistical policy and oversight functions to OMB should be deleted.
We believe that the uniqueness of statistical activities, which are
highly developed, disciplined, and technical, requires a special expertise
with independent policy oversight and coordination responsibilities.
While OMB must and does work closely with those responsible for
statistical policy, they should have sufficient independence to address
the unique needs of the statistical community.
Second, we believe that those provisions of H.R. 6410 which task
OMB to audit or inspect agency information management activities
should be substantially modified. Under the Budget and Accounting
Procedures Act of 1921, and other existing statutes, we already have
sufficient authority to review agency activities. We believe that OMB's
role should be to establish policy, oversee its implementation and
evaluate its effectiveness.
. While we intend to conduct management evaluations and monitor
program performance, we do not believe that OMB should be an
audit agency. Such a mission would require a significant increase in
resources and would divert critical attention from our oversight and
policy development responsibilities.
Most important, we believe that an audit or inspection responsibility
would place us in an undesirable, adversarial relationship with the
executive departments and agencies.
If we are to develop and implement successful information policies,
we must have a trustworthy working relationship with the agencies.
We believe that audits and inspections should be performed by other
organizations, such as GAO, audit agencies, or inspectors general.
Third, we believe it is unnecessary and inappropriate to legislatively
mandate an Office of Federal Information Policy within OMB headed
by an administrator. It is unnecessary because, as I have mentioned,
we have recently realined our policy oversight responsibilities in a
fashion which will permit us to accomplish all the objectives of
H. R. 6410.
However, to establish an independent office headed by an adminis-
trator would isolate these functions from other OMB responsibilities,
prevent the balancing of competing interests, and result in information
policies which inhibit, rather than support, the accomplishment of
Government missions.
The development of Federal information policies should be an
integral part of the OMB mission. Assigning this responsibility to an
independent entity which is legislatively mandated would preclude
this integration.
We also believe it is inappropriate for legislation to dictate how and
where the President and Director must delegate certain responsibilities.
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While we agree with the need for these functions, we must have the
flexibility and authority to organize these functions in the manner we
believe will best permit us to carry out our responsibilities.
Another concern is that H.R. 6410 does not clearly describe the
relationship between OMB, as the central authority for Federal infor-
mation policies, and other executive branch agencies with related
responsibilities.
A number of agencies who reviewed the legislation commented that
H.R. 6410 appears to establish that OMB will have oversight and
policy responsibility over all other agencies, such as Commerce-
computer standards and telecommunications policy; GSA-informa-
tion technology acquisitions and records management; DOD-
national security information and telecommunications standards,
which have information policy responsibilities.
We recommend that this relationship be clarified.
Finally, a number of agencies indicated that it was unclear as to
what responsibilities are intended to be assigned to the information
manager in each agency. For example, within the large agencies such
as DOD, it would be extremely difficult, if not impossible, to assign
responsibility for all information management activities to one individ -
ual or organization.
The intent of the drafters of H.R. 6410 should be clarified on this
issue.
Those are our major comments on H.R. 6410. We are preparing a
letter with additional comments and requested changes which we
would like to submit for the record in a few days.
Mr. BROOKS. Without objection, so ordered.
[See app. B-3.]
Mr. GRANQUIST. In closing, I would like to say that we believe that
H.R. 6410 is a significant and far-reaching piece of legislation which
will provide us with some badly needed tools to improve the manage-
ment of Federal information. While there are some parts of H.R. 6410
we would like to see changed, we are pleased with the overall direction.
For that reason we strongly support the bill.
That concludes my opening statement. We would be pleased to
answer questions.
Thank you.
Mr. BROOKS. Thank you very much for an affirmative statement and
a strong statement.
The Comptroller General, Mr. Staats, clearly favored transferring
statistical policy functions from the Department of Commerce to
OMB as provided by the bill. He sees a particular close relationship
between statistical policy and the Federal Reports Act objectives for
controlling paperwork burdens.
Is there not a direct relationship between statistical policy and the
information management functions which would suggest that they
all be placed in one organization?
Mr. GRANQUIST. There is a close relationship between the objectives
of the Federal Reports Act, paperwork reduction, and statistical
policy. We do not believe, however, that this close relationship
suggests the need to locate all these elements within OMB.
We are working on, and we have already in place, a set of procedures
to allow review of statistical forms by the statistical office now in
Ccmmerce, pursuant to guidelines issued by 0MB.
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95
Mr. BROOKS. You objected to the provisions in H.R. 6410 which
requires OMB to insure that audits of agency imformation manage-
ment activities are conducted. Your primary reason for objection
apparently is that you do not believe OMB should be in an adversary
relationship with the executive agencies.
Is it possible to exercise the central management responsi-
bilities provided for in H.R. 6410 without creating some adversary
relationships with the agencies?
Mr. GRANQUIST. Mr. Chairman, having gone through several
budget cycles, I am aware that there is always some adversarial
relationship between OMB and the agencies. The point I would like
4 to make is how serious the adversarial relationship has to be.
I want to focus the attention of the committee on the particular
portion of the bill I referred to in my testimony. We are most con-
cerned with the provisions that require OMB, with GSA's assistance,
to inspect agencies and to report thereon to congressional committees.
That is a role we believe is best played by the inspectors general,
by audit agencies, or by the GAO. For OMB, even with GSA's as-
sistance, to conduct hands-on kinds of inspections, and then report
thereon to the Congress and others would, in our view, put the Director
in an unnecessarily adversarial position with the agency heads and
place us in the relatively untenable position of serving two masters,
the President and the congressional committee.
That is the reason for our concern with that particular prevision
of the bill.
Mr. BROOKS. The only delegation of authority by OMB tc the
agencies provided by H.R. 6410 is for reports clearance. What steps
will the OMB take to insure that these delegations are effectively
carried out by the agencies?
Mr. GRANQUIST. It is our intention to establish Government-wide
guidelines that describe those actions that an agency has to take,
and to make sure they have the personnel and expertise to carry out
these responsibilities.
The guidelines would also identify the procedures, like review and
certification, that the agency must implement as part of the reports
clearance process.
The easiest way for me to describe what we intend to do is to use
the words "earned autonomy." This is a term used and developed by
the President's ADP reorganization project. The concept was en-
dorsed in the testimony of the Comptroller General before this sub-
committee on February 7. The agency has to earn its autonomy. It
can be taken away if it does not carry through on its obligations.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
First cf all, let me congratulate the President for taking a personal
interest in paperwork reduction and for issuing Executive Order
12174 last November in an effort to cut down paperwork imposed on
the public by Federal agencies.
Also, I want to congratulate OMB for the January 11 proposed
regulation designed to control Federal paperwork and its burden.
I am glad to see that on this important issue the President, OMB,
and this committee are all working in the same direction.
I would also add, following the delivery of the final report of the
Commission of Federal Paperwork in October 1977, bo President
Carter, I talked first to Bert Lance, who was then the OMB Director.
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He was strongly in favor of carrying out the recommendation of the
Paperwork Commission and for cutting down on paperwork. The
President personally indicated his support for that objective. Sub-
sequent to that date, with the appointment of Jim McIntyre, who
succeeded Bert Lance as the OMB Director, has indicated his strong
commitment. As a matter of fact, just this week I was at a dinner at
the White House. I saw Mr. Mclntrye. Again, he emphasized his
strong commitment to the reduction of the paperwork burden.
I want to give this administration very high marks in trying to do
something about this paperwork burden.
I know that we are all concerned about it. I know that everytime I
go back to my district, I get besieged by people talking about "stran-
gulation by regulation."
Most of that strangulation is manifested in the paperwork burden.
I have had people tell me in my district that they have to go out of
business because they cannot comply with all the Federal paperwork
requirements. I have had some tell me that to try to answer questions
that are sent to them from the U.S. Department of Commerce, it would
cost them $10,000 just to hire the staff necessary to get the information.
They have said that they would rather go to jail than answer the
questions. Answering the questions would force them out of business.
It is important, therefore, that we look at this paperwork burden. It
is a kind of quiet activity; we see just the tip of the iceberg. Underneath
there exists what we in 1977 called the $100 billion burden that is
imposed on small business and the Government with regard to the
paperwork.
I understand that in discusing this bill with our committee staff
over the last several months, OMB has resisted the idea of setting
information policy for the entire Government.
Have you changed your mind on that? Or, do you feel that per-
forming this function is inappropriate so far as OMB is concerned?
Mr. GRANQUIST. Mr. Horton, first of all let me thank you for your
opening remarks. We appreciate those compliments very much.
Second, with respect to your question, let me say this. I would not
characterize our position as resisting the setting of information policy.
The bill, as we have discussed it with committee staff over the last
several months, has changed from time to time and has been substan-
tially improved.
Our concern has not been with setting policy. We have been con-
cerned that we do not take on operational responsibilities at the same
time that we are taking on policy responsibilities.
Mr. HORTON. I do not think the bill should be construed as directing
you to take on operational responsibilities. At least, I do not feel that
the bill is designed to require you to carry out the policies or assume
the burden of oversight.
Mr. GRANQUIST. If the record clarifies that point, then that would
be very helpful to us in understanding what our responsibilities are
when the legislation becomes law.
Mr. HORTON. In answer to the question Mr. Brooks asked earlier,
you did make some comment with regard to this area.
Mr. GRANQUIST. Yes.
Mr. HORTON. I just wanted to make certain that you understand
how I personally feel about it. Even though the operational aspects are
delegated to agencies, I think OMB has a responsibility to make cer-
tain that those operational aspects are being carried out.
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That is the oversight responsibility, as I see it. Maybe there is some
confusion. Maybe we are a little bit ambiguous in the language of the
bill. Maybe we can work something out. Maybe your staff can work
with our staff to clarify that, or maybe we can put something in report
language so we are clear on that.
However, I think we ought to make certain that OMB has that
responsibility of oversight. That is an active responsibility. It is not
a passive one.
I am not talking about this administration. I do not know what the
next administration will be like, or how it will react to this problem.
Maybe they will feel that once a few things have been accomplished,
then we do not have to worry about it..
What I think what we have to do here is to design a system that
will make certain that OMB not have the operational burden, but that
OMB will have some responsibility in making certain that the agencies
are doing what they are supposed to do in attempting to reduce
paperwork.
Mr. GRANQUIST. Your comments have been very helpful in clari-
fying the intent of the committee.
We would be pleased to work with the staff and work this out.
Mr. HORTON. Thank you.
Another point is this. A key part of H.R. 6410, insofar as reducing
the paperwork burden on the public is concerned, is the revision of the
Federal Reports Act of 1942, which deals with the clearance of
information collection requests proposed by Federal agencies.
Do you have any problems with this part of the bill?
Mr. GRANQUIST. No.
Mr. HORTON. I think this is a very important part. If we do not have
something like it, I think we are going to continue to have this prob-
lem of paperwork.
Let me turn to another area. I understand OMB has had an oppor-
tunity to see a copy of the draft of the proposed report from the
General Accounting Office.
I have not had a chance to read the report. I certainly will do that.
I do not think we ought to go into any detail at this particular point.
However, the thing that bothers me is this. The title is, "The Fol-
lowup Program for Federal Paperwork Commission Recommendations
Is In Trouble." I hope that is not right, but the GAO is usually pretty
accurate. The Comptroller General was a member of the Commission.
He indicated that GAO was going to direct some of its effort to
making sure that the recommendations were followed up.
The Commission, when it made its recommendations, expected,
based on the legislation which was enacted, that OMB would carry out
its responsibility in following up on them.
I do not know whether you want to make any comment about this
or not at this time, but I do think it is important to have your com-
ments, or OMB's comments, with regard to what is being claimed in
this GAO report. I do not want to go in detail, because frankly I have
not had an opportunity to read the report. We just got it yesterday
afternoon.
Mr. GRANQUIST. I have not react the report. I would be pleased to
submit some information for the record responding to the concerns
that the report raises.
I would suggest one additional point.
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The legislation, H.R. 6410, extends by 2 years the time for imple-
menting and overseeing the implementation of the CFP recommenda-
tions. That is language we suggested and proposed. We support it. We
believe those are important recommendations. Sixty percent have been
implemented thus far, and 67 percent have been acted on. That is
good; but it is not good enough.
We have 2 more years in the legislation to follow through on that
goal. We want to do the best job we possibly can.
Mr. HORTON. That is helpful.
Mr. BROOKS. Very well.
Without objection, so ordered.
[The material follows:]
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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
Honorable Elmer B. Staats
Comptroller General of
the United States
General Accounting Office
Washington, D. C. 20548
I am sending you my comments on the draft GAO report on OMB
follow-up of the recommendations of the Commission on
Federal Paperwork (Code 009900) because of your sustained,
personal interest in the goals and objectives of the
Commission.
The Commission on Federal Paperwork was established in
recognition of broad complaints about the excessive burden
of paperwork imposed on the public by the Federal
Government. Excessive paperwork burden may be seen as a
consequence of many specific problems and shortcomings in
agency programs, but fundamentally, the cause is the attitude
and approach throughout government to the management of
public reporting requirements and other information
resources.
In its wide ranging work, the Commission identified many
specific,'worthwhile corrective actions. We applaud the
contribution that the Commission made and we recognize that
there is much to be done to complete the work begun by the
Commission.
But a consistent theme in all the work of the Commission is
a concern that once these specific problems are corrected,
they stay corrected. The only way to make sure that the
same problems do not spring up again like weeds mown down is
to put in place a sound management process. We have taken
as a high priority the long term management process implied
in all the Commission's work. The draft report should
emphasize the need to establish a long term management
process that can prevent the return of the problems and
abuses identified by the Commission. I believe that the
report could be improved greatly if it were modified to
include recognition of this need and our substantial efforts
to deal with it.
In accord with the high priority we have given to the long
term management process, there have been fundamental
modifications in the Federal Government's approach to the
management of information as a resource:
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-Executive Order 12044, Improving-Government
Regulations, is changing the rulemaking process in ways that
the Commission recommended to lessen paperwork burden.
These changes include greater involvement of interested
parties, longer comment periods, sunset review of existing
regulations, and more consistent use of plain, easy to
understand language.
-The President's Reorganization Project has resulted in
significant realignments of functions that have reduced
fragmentation and simplified relationships in ways that have
helped to reduce paperwork burdens. For example,
consolidation of various energy data systems in the new
Department of Energy was an important factor in reducing the
existing reporting burden by 5,000,000 hours.
-We have reorganized relevant functions at OMB,
combining responsibility for paperwork reduction with that
for regulatory policy and information policy.
-Based on study of the Commission's reports and our
experience in the first two years of the President's
paperwork reduction program, we have developed a
comprehensive, new system that we regard as the real
beginning of managing information as a resource. This
svster is express-!d in the __
Executive Order 12174, Paperwork, and regulations we
proposed in January 1980 to implement the Executive Order.
These regulations would replace. existing OMB guidance on the
Federal Reports Act. This system will initiate planning and
budgeting of information collection from a resource
allocation viewpoint, require examination of how information
is used once collected, establish a Federal Information
Locator System, strengthen the reports clearance process by
placing more responsibility on agencies and putting control
points earlier in the clearance process, and require that
agency responsibility for paperwork control be at a high
level, independent of program operating responsibility, and
able to approve, deny, or modify proposed forms.
-We have also -supported legislation to unify
responsibility for paperwork control in OMB, eliminate
exemptions to that control, and further strengthen the power
of that control.
The intention of this new system is to develop and
institutionalize consistent policy level involvement in
agency reports management. The draft GAO report cites lack
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of involvement by top agency managers as a problem in
implementing Commission recommendations. In fact, that is
just one specific aspect of the fundamental problem of
ineffective agency management of paperwork and information.
Although we have made fundamental system changes our first
priority, we have moved ahead on individual Commission
recommendations. There has been significant progress,
although the draft report does not recognize this. We are
not by any means finished, however, and we are not ourselves
satisfied with the pace or resourcefulness of agency
efforts. We originally expected to complete follow-up by
the end of our two-year statutory reporting obligation. As
you noted when testifying before Congressman Brooks on
February 7, additional time is necessary to complete the
.job. This is a consequence both of the extent of the
Commission's recommendations and inadequate existing
processes for managing information resources. We recognized
this and expressed our continuing commitment to effective
follow-up in our proposed paperwork control regulations
(1370.7(f)). We have also endorsed legislation to extend
this responsibility.
The draft report includes many assertions and conclusions
about individual CFP recommendations. We believe this is
premature. We have not rendered final decisions on any
recommendations. To dispute the status of particular
recommendations in advance of such an assessment would
distract from the main task of reforming Federal paperwork
management and reducing burdens. We will, however, use
specific information in the draft report as, a constructive
contribution to our task. We will take remedial action
where we find this information to be accurate.
We do have comments on the specific recommendations for the
OMB Director in the conclusion of the draft report.
1. We have taken steps to augment resources and increase
the level of effort devoted to CFP recommendations. We
intend this oversight and follow-up to continue to be
integrated with other paperwork control, regulatory
policy, and information management responsibilities by
our desk officers. In our view, a separate staff with
exclusive responsibility for CFP recommendations would
accomplish less in the long run.
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2. Securing effective participation of agency top
management has been our objective for some time. It is
the reason for our giving top priority to overall
management system reforms. We concur with the
principle of assigning lead responsibility for multi-
agency recommendations. Our plans, discussed with GAO
staff,~have always provided for disclosure of imple-
menting actions in the wrap-up at the end of the
statutory reporting period. These actions will be
specified in subsequent status reports.
3. We will continue our practice of obtaining new or
revised agency responses to recommendations whenever
our review (including consideration of the draft GAO
report) indicates insufficient development or
inadequate response.
4. The exclusion from our follow-up process of recom-
mendations'directed to the Congress was done with the
knowledge of GAO staff. It was based on the concept of
separation of powers. We are willing to reevaluate
our approach and consider development of specific,
appropriate executive branch actions.
5. Our plans for follow-up, developed with knowledge and
consultation of GAO staff, called
for
descriptive
assessment of the disposition of
each
recommendation
(specific actions taken, reasons
for
rejection,
alternatives considered, etc.) in
the
report at the
end of the statutory reporting period. We have not
intended that the summary status listings we have
published on an interim basis be a complete
accounting of actions taken. Such a disclosure is
called for, and will be the basis of status reports
during the period of our extended oversight
responsibility.
With regard to the recommendations for the Congress in the
conclusion of the draft report, we have endorsed, in our
testimony, on H.R. 6410, an extension of OMB's two-year
statutory responsibility for follow-up of the Commission's
recommendations. Also, as noted in 4. above, we will
reevaluate our approach to Commission recommendations
directed to the Congress.
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103
Our position is precisely that of the Paperwork Commission.
You will recall how Frank Horton summed it up in his letter
to President Carter delivering the Final Summary Report:
1.
A substantial reorganization of Government adminis-
trative and management machinery which affects
Federal paperwork process;
the
2.
A new philosophy of Service Management so that
laws, rules and regulations are made in a
context of true consultation and participation
with the people; and
3.
A continuation and expansion of effort to cut
paperwork which has already been mounted by the
Administration."
Thank you for the opportunity to comment on the draft report.
I want to assure you that Jim Tozzi and I have a strong personal
commitment to sustained, effective follow-up of the Commission
recommendations as an essential and integral component of our
overall effort to cut Federal paperwork.
WayrIX G. Granquist
Ass ciate Director for
Management and Regulatory Policy
cc:
Allen R. Voss
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104
Mr. HORTON. This draft report is probably a red flag which we
probably all ought to take a look at and make certain that we are
following up. Perhaps if our staffs can work together to work out what
is involved with regard to this report, then it can be very helpful.
Mr. GRANQUIST. We will do it.
Mr. HORTON. Mr. Chairman, that is all I have at this time.
Mr. BROOKS. Thank you very much.
I recognize the gentleman from Georgia, Mr. Levitas.
Mr. LEVITAS. Thank you, Mr. Chairman.
First of all, let me join Mr. Horton in congratulating the adminis-
tration and OMB for what I believe to be a sincere commitment to
reduce the paperwork burdens and eliminate duplicative reporting
and generally to reduce the regulatory burdens and to rationalize
them.
I think it is a very sincere commitment on the part of this adminis-
tration. I think there have been steps taken already. Others will be
taken to carry out this policy. I think that should not go unnoticed.
I have a few questions that I would like to ask you. What has
actually been accomplished in quantifiable terms to date by the
administration in reducing paperwork?
Let me ask a more fundamental question. What do you mean by
reducing the paperwork burden?
Mr. GRANQUIST. We define the burden imposed by Federal paper-
work as the number of hours, or the number of person hours, that it
takes to collect, put down on paper, and fill out Federal Government
forms.
When we took office that burden was something in the neighborhood
of 900 million hours a year. We have reduced it by 130 million hours
during this administration.
One way to look at it is to say that it is equal to all the people in a
town with a population of 70,000, working 40 hours a week, and 52
weeks a year, filling out Federal paperwork forms.
What is left is equivalent to the city of Pittsburgh, working 40 hours
a week, 52 weeks a year, with every man, woman, and child filling out
paperwork forms.
So, there is a lot left. We knocked out an amount equal to Dubuque,
but we still have Pittsburgh left.
Mr. LEVITAS. Let us break that down a bit. You eliminate paper-
work, or reduce the burden in using the statistics that you have
referred to in what ways? By eliminating forms? By reducing the
amount of information on a particular form? How do you do it? Do
we have more forms today than we did?
Mr. GRANQUIST. We have fewer forms. However, counting the
number of forms is not the most useful way to analyze the burden. Any
one form can be tremendously burdensome on the American people.
You can reduce the burden by reducing the frequency with which
information is sent to the Government. You can reduce the size of the
sample. If it is a statistical form, it can be reduced from 1 in 4 to 1 in
10. You can also reduce the amount of information on an individual
form, or you could eliminate the form. We have used all four of these
methods to reduce the burdens.
One good example of reducing the size of the sample, or eliminating
the form, is OSHA. It knocked out completely its reporting require-
ments for all employers with 10 employees or less. That eliminated
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40,000 American businesses from OSHA forms. It reduced the burden
substantially.
Mr. Tozzi. Another area that you were interested in is the regulatory
reform area. Another way of reducing the burden is to look at the scope
of the regulation that generates the burden.
We commend this committee for putting, as an integral part of this
bill, the requirement to look at the paperwork burden imposed by the
regulations themselves. Many times you can take the regulations and
then determine the least cost burden. Many times, however, it is the
regulation itself that generates the information burden. The commit-
tee print, as it appears now, directs OMB to look at the scope of
regulations in terms of the reporting burden.
That is an integral part of the regulation. We have tied that review
into both this Executive order and the Executive order on regulatory
reform.
Mr. LEVITAS. You anticipated another question I was going to ask
later on. Inasmuch as you have raised it, let me get into that now.
As you point out in your prepared statement, most of the paperwork,
if not all, is a reponse to statutory or regulatory requirements for
information to determine compliance.
In another room in this building, at this moment, the Judiciary
Committee is marking up the regulatory reform proposal of the
administration.
It seems to me that these two subject matters cannot be separated.
Do you not believe that in order for a reduction in paperwork in the
form of reporting to be generated by regulations with OMB having a
hands-on responsibility in this area, do you not think there needs to be
a hands-on responsibility, let us say by OMB, in the regulatory reform
area?
Mr. GRANQUIST. The answer is yes. We have combined those two
responsibilities in the same office of OMB headed by Mr. Tozzi,
under my direction.
The administration's position on the other legislation, undergoing
markup in the Judiciary Committee, is that there should be oversight
responsibilities in OMB, within the executive branch, in the regulatory
policy area.
Mr. LEVITAS. I think it should be, but in regulatory reform I am
getting confusing messages. I may be reading something into it, but I
get the feeling that there is some split within the administration about
having OMB as the hands-on manager of regulatory reform.
Mr. GRANQUIST. I can assure you there is no split in the adminis-
tration on that point.
Mr. LEVITns. Thank you.
I would like to address one of the concerns I have about this legis-
lation in a different direction.
How do you see H.R. 6410 improving the governmental efforts to
reduce paperwork, or is this nothing more than a reshuffling of the
cards in the deck?
Mr. GRANQUIST. There are a couple of things which it does that are
very important.
First of all, it closes up loopholes, some of which have existed from
the beginning of the Federal Reports Act of 1942.
It reverses the direction given to the review of independent com-
missions by the Alaska Pipeline Act of 1973, by partaking that
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authority from GAO and bringing it back to OMB. This review would
be subject to an override by the majority of the full commissioners,
which would permit a second look and preserve the independence of
the regulatory commissions; but, nevertheless, it would bring reports
review under one roof.
Most importantly, it puts real teeth in the Federal Reports Act.
The bill, as- it is written now, would allow any citizen or company or
interest or organization that received a form from the Federal Govern-
ment to ignore that form if it did not have an OMB clearance number
on it. That is explicitly permitted and it is a substantial change in the
Federal Reports Act.
Mr. LEVITAS. With regard to the paperwork budget that you have
established under the Executive order, I assume that the quantity of
that budget is worked out in some form of negotiation between the
agency and the OMB; is that right?
Mr. GRANQUrsT. Yes, the requests are submitted by the agency and
then negotiated.
Mr. LEVITAS. Is the quantity of allowable paperwork budgeted and
based on the same type of statistical groundwork as those statistics
you gave me earlier in dealing with the overall burden of paperwork?
Mr. GRANQUrsT. The estimates will be based upon existing require-
ments, plus anticipated statutory requirements for information that
may be coming down the pike from the Congress.
Mr. LEVITAS. What I am saying, more simply, is this.
What is the budget? You say you have a paperwork budget. What
is it? What do you tell EPA?
Mr. GRANQUIST. Let us say EPA comes in and says they want to
occupy 40 million hours of the public's time next year in filling out
forms. We look at those requirements and we look at the forms. We
can say that we disagree. We can make suggestions about doing it
another way. It is the same as a budget process in general.
We will negotiate those totals. Once the total is established the
Administrator of EPA would be required to stay within that total.
We are trying to force trade-offs down the line and require that
information no longer be looked at as a free resource. We want to
require an agency head who wants to collect the information about
situation x, to analyze the trade-offs and realize he cannot get as
much information about something else that he might be interested
in. He has to make priority decisions.
Mr. LEVITAS. Is IRS covered?
Mr. GRANQUrsT. Yes, IRS would be covered by H.R. 6410.
Mr. LEVtTAS. How do you deal with the problem of duplicative
reporting?
Mr. GRANQUrsT. We have the authority in the Federal Reports
Act, which would be even more strengthened under this bill, to direct
one agency to collect information and share it with other agencies
within the bounds of confidentiality and privacy protections. That is
how we would deal with the duplication.
Mr. Tozzi. The paperwork budget would probably force the agencies
to look at this duplication more than they have in the past because
once they are constrained by that total, they will have even more
incentive to look to see if somebody else is collecting the data.
Mr. LEVITAS. I think you are absolutely correct in that regard.
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I notice you have 45 people on your staff, with one person assigned
to each agency. I assume some people have more than one agency
they deal with.
Getting back to the question of duplicative reporting, is there any-
place where, let us say, a person who is working with the Department
of Labor, and who is looking at a form being required of nursing
homes, would talk with a person who is working with the Department
of Health and Human Services about this?
Let us say he is also getting certain information from nursing
homes. There is also someone who is working with IRS in getting
certain information from nursing homes. Maybe they are all collecting
the same information.
In other words, do these things ever come together?
Mr. Tozzi. Yes, sir. Let me give you two organizational aspects
that force them to come together.
First: The committee has taken the leadership, with our help, in
developing a Federal locator system which is under development at
OMB. Now, we have our hands on real-time data to task our EDP
system to help us do that.
Second : The examiners in this area work within their own area,
but before a form is cleared, my division chiefs and I meet and go over
the forms together. It feeds up to that process. All forms go through
that executive committee before they are acted on.
Therefore, there is a series of balances in there that we look for in
terms of duplication.
Mr. LEVITAS. Thank you.
I am encouraged by what you have testified to here today. I am also
encouraged by the fact that you think this legislation might accom-
plish something. I had some doubts about that. It is encouraging to
know you feel it will bring about some improvement in this problem
that we all talk about, but do not ever seem to really do much about
except talk about it.
I think the real paperwork burden, although we frequently try to
lay the blame on the bureaucracy, originated in the Congress with the
statutes that Congress has passed within the last few years.
I think we have to take the lead in reducing the paperwork burden
on the American public.
From what you tell me, your testimony is very encouraging, both
as to the efforts to this administration, and your belief that this legis-
lation may help in that fight.
Thank you, Mr. Chairman.
Mr. BROOKS. Gentlemen, we want to thank you for your testimony.
Our next witness is Mr. Fred Wacker. He is the Assistant Secretary
of Defense. He serves as Comptroller of the Department of Defense.
He has been with the Department since 1951 and has been Assistant
Secretary since September 1976. He has a B.A., magna cum laude
from American Univerity, and a master's degree in financial manage-
ment from George Washington University.
It is my understanding that with 29 years of service, and almost 30
years in the Department, he is going to retire. You will be amazed,
surprised, and delighted to know that he is not going to work as the
vice president of the widget manufacturers that sells to the Defense
Department. [Laughter.]
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It really is kind of refreshing. He will not sell computers to the
Government. He will not sell generators or exotic consultant services
to the Defense Department or to one branch of it, or to one of their
subsidiaries. He is not going to work for one of those companies that
the Defense Department loves and nurtures, like E-Systems.
[Laughter.]
He is going to work for Public Broadcasting. They use a little
Federal money, though. [Laughter.]
I want to congratulate Mr. Wacker. It is understandable that he
has worked long and faithfully for the Federal Government and the
Defense Department honestly and objectively. It is not easy.
He will certainly make a splendid contribution. You have been
here before and we have always enjoyed having you: We are glad to
welcome you back.
You may proceed.
STATEMENT OF FRED P. WACKER, ASSISTANT SECRETARY OF
DEFENSE (COMPTROLLER), DEPARTMENT OF DEFENSE; ACCOM
PANIED BY WINFIELD S. SCOTT, DIRECTOR, MANAGEMENT IN-
FORMATION CONTROL AND ANALYSIS; AND ROBERT L. COOPER,
OFFICE OF THE DIRECTOR FOR DATA AUTOMATION
Mr. WACKER. Thank you, Mr. Chairman.
I appreciate that. It is, in fact, 31 years. There are times when I
feel every one of those years.
Mr. BROOKS. Where was that?
Mr. WACKER. With the Department of Commerce and the General
Accounting Office in the early days. It has been a long time. I leave
with a great deal of regret. I have enjoyed working with the Depart-
ment, and I have enjoyed working' with this committee. I have
enjoyed serving the Federal Government.
It is an unexpected pleasure and bonus in my final 7 days to have an
opportunity to appear once more before this committee and to speak
in support of your very important proposed legislation on the Paper-
work Reduction Act.
We are pleased to appear before your subcommittee today to
discuss H.R. 6410, the Paperwork Reduction Act of 1980.
As you know, we worked actively with the Paperwork Commission
throughout its existence and have been actively supporting the follow-
on efforts of the Office of Management and Budget. We are parti-
cularly supportive of the strong central management focus of the bill
and believe that such focus can only serve to enhance and fortify our
own ongoing efforts in information management.
From our perspective, the bill has two major objectives:
One : To implement the concept of information resources manage-
ment by incorporating and integrating the many separate, but related,
information activities. These include the review and approval of infor-
mation requirements, the public-use reports program, Federal statis-
tical and records management activities, the privacy program, the
sharing of interagency information, and the acquisition and use of
information technology.
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This concept of information resources management will focus efforts
to manage and control information through its entire life cycle from
the time the requirement for the information is first expressed through
its ultimate disposition.
We are firmly convinced that the management and control emphasis
must be applied at the requirement or front-end of the cycle, because
it is the requirement that drives all the other phases, such as ADP
hardware/software needs, records creation, micrographic and word
processing considerations, and so forth, right on through the cycle of
records storage or disposal.
Two: The clear articulation of an objective to acquire and use
automatic data processing and telecommunications technology in a
manner which improves service delivery and program management,
increases productivity, reduces waste and fraud, and reduces the infor-
mation processing burden on the public and private sectors.
The Department of Defense recognizes the need to strengthen and
improve information management and control processes. In recent
years, we have attempted to develop departmentwide policies and
procedures to achieve these improvements, and I am pleased that
some of our procedures have been adopted by several other Govern-
ment agencies.
I would like to outline briefly for the committee some of the more
significant actions we have taken. I will also summarize some of our
continuing work with OMB.
First : The Commission on Federal Paperwork made 49 recommen-
dations to the Department of Defense to eliminate existing paperwork
problems.
Of this number, the Department of Defense is in the process of
implementing or planning to implement 42; seven recommendations
were determined to be not applicable or accommodated by actions
which had already been taken.
Second: As a result of the Department's initial effort, as well as
the President's burden reduction program, we have eliminated 52
public-use reports from our inventory, a 20-percent reduction.
Third: The need for an information locator system was recognized
within the Department of Defense several years ago. The Department
already had developed improved information management policies,
but it was apparent that to effectively do the job, we had to manage
information at the data element level. We had to get down to the
grassroots, or the basic building block.
Therefore, in late 1976 we began development of the DOD Informa-
tion Requirements Control Automated System, IRCAS, which became
operational in early 1977.
IRCAS software is Government owned, and is available to any
Federal agency. In fact, nine agencies are using the IRCAS software.
Some time ago, we had the opportunity to brief and demonstrate
this system to Congressman Horton, senior members of the Commis-
sion on Federal Paperwork, and OMB.
In November 1978, Mr. McIntyre requested that we work with
OMB to use the system as a possible prototype for the Federal infor-
mation locator system. We have worked closely with OMB as an
active participant on the FILS task force.
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Fourth: Through the combination of our information management
and control policies and the IRCAS, we have already reduced or
eliminated a substantial number of our information requirements and
have made a concentrated effort to standardize, simplify, and reduce
the forms used within the Department of Defense.
We are also pleased to see several significant additions, in H.R.
6410, not present in earlier versions, which deal with:
One: Specific incorporation of a responsibility for automatic data
processing and telecommunications technology in the charter of the
Office of Federal Information Policy. We think this makes a good deal
of sense. We welcome that central management in the information
policy oversight.
Two: Establishment of a planning process consisting of audits of
major information systems, identification of specific initiatives to
improve the productivity and performance of Federal operations
through the use of information processing technology, and develop-
ment of a.5-year plan.
Three: An annual report to the Congress which would include our
status in accomplishing these activities. You are going to have to
continue to follow up on this. It is going to be a collective and concerted
effort that is required.
Aside from strengthening the management of information as a
resource, a parallel theme of the bill is the improved use of information
technology throughout the Federal Government. We wholeheartedly
endorse this second and equally important, theme.
From our perspective, there is a clear need to strengthen the
relationship between information requirements and the application
of technology to satisfy those requirements.
We have seen that failure to deal effectively with both subjects
can only result in systems which are too costly or which do not supply
managers with timely and accurate decision support.
In the Department of Defense, we are attacking the problem of
defining information requirements and building systems to satisfy
these requirements through the life cycle management process.
Since I have described this process in previous hearings, I will not
take the committee's time to recount this process in detail today. In
sum, however, it:
One: Focuses on early identification of the mission element need
for automated information systems.
Two: Emphasizes continual involvement of functional managers in
decisionmaking.
Three: Requires evaluation of alternative design and development
approaches and acquisition strategies.
-- Consistent with your recommendations, we are moving forward to
fully implement the life cycle process throughout DOD. As you are
aware, this is not an easy job.
Accordingly, we believe that one of the strongest points of the pro-
posed legislation is the reenforcement which it gives to the concept
that a close marriage of requirements and technology is essential for
the achievement of cost-effective systems.
I associate myself with some of the concerns that Congressman
Levitas expressed to some of the previous witnesses.
I, too, sat back and looked at this legislation. I studied it over the
weekend. I wondered whether it was required. I am entitled to ask
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that question and to tell you I asked myself that question: Is it
required or is it just spinning windmills and putting out a piece of
paper for the cosmetic effect?
I really feel from the Department of Defense's point of view that it
is an important piece of legislation because I believe it is important to
centralize within the executive department the focus for the policy
oversight and monitoring of Federal paperwork programs.
We are excited within the Department at some of the progress we
have made as a result of our own IRCAS control system.
We have eliminated a number of reports and a number of forms.
We think that really is just scratching the surface. We want to share
it with the rest of the Government. Sharing is a voluntary type opera-
tion at the moment.
I think the establishment of a centralized office, such as you are
proposing, Mr. Chairman, will put some teeth in the whole process.
Let me close by introducing the gentlemen on my left and right
whom I have asked to be with me this morning, Mr. Winfield Scott,
and Mr. Cooper. They both work for me.
I think I indicate to you, and underscore by having these two gentle-
men sit with me this morning, the importance we attach to information
management and to the acquisition and use of information technology,
which is an associated, but a follow-on step, once you have gotten at
the basic requirement and need.
With that, Mr. Chairman, I will attempt to answer any questions
you may have.
It has been a pleasure to work with this committee over the years.
Mr. BROOKS. Thank you very much for a fine statement. You
usually do that.
I have a couple of questions.
H.R. 6410 provides for the appointment by each agency head of a
senior official to carry out the agency's responsibilities under the bill.
Do you agree with the need to establish this office as a central focal
point to oversee the agencies' information management activities?
Mr. WACKER. I believe that in general that is important. Within
the Department I have the responsibility for developing and imple-
menting DOD policies and principles, standards, guidelines, and so
forth. I have responsibility for the paperwork burden placed on the
Government and the statistical activities. I have records management
and data processing resource policy responsibility.
I believe it is important, but I think there are other opinions that
the committee will have to consider, after having heard testimony, as
to whether some adjustments to the bill are in order or whether the
complete consolidation of all these functions are appropriate at the
OMB level within the executive department.
I have to defer on some of those from a global standpoint, but
within the Department of Defense, as I now read the bill, I have
responsibility for virtually everything you are covering, except some
aspects of the Freedom of Information Act. I think we would
need to look at that within the Department and see whether the inter-
face that exists is appropriate or whether some organizational realine-
ment is necessary.
I would like to fill this in as part of our follow-on technical submis-
sion to the staff, but in general that long-winded answer, I believe,
means, yes.
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Mr. BROOKS. What changes will be necessary in DOD's newly
established life cycle management process should the bill be enacted?
Mr. WACKER. As you know, your committee has given us strong
support although I think the word "support" may be a euphemism as
I look back on some of the systems that we have discussed with you
recently-but, you have given strong support in the life cycle manage-
ment policy. What we have concentrated on up to this point is getting
an involvement of the functional manager who is responsible for the
requirement with the technical manager who provides the automatic
data processing and the like.
I believe the thing that has sunk in on me as a result of studying the
legislation and its objectives, is that I need to involve much more
strongly, an additional part of the organization and that is the infor-
mation manager. I need the functional manager and the ADP expert,
but I need to involve more than we have before the information
manager within DOD.
I think I see that sort of adjustment to our life cycle policy coming
from the emphasis and direction in your legislation.
Mr. BROOKS. Mr. Kiviat inferred in his testimony 2 weeks ago before
this committee two recommendations of the President's ADP reorgani-
zation project, which need to be addressed by individual agencies.
What actions has the DOD taken to implement these recommenda-
tions?
Mr. WACKER. Two of the more significant ones that we have
discussed on a number of occasions are the ones I just addressed, that
is, the need for a life cycle management policy. I think we are well on
the road with that.
Another principal recommendation in our case is the general
strengthening of career management for ADP professionals. We have
taken a number of initiatives there.
You may be interested, Mr. Chairman, that we have provided to
the OMB recently a complete compilation of the national security
task force recommendations as part. of the ADP study.
I would like to make that available to the committee, if I may. It
will cover the complete recommendations and our responses thereto.
Mr. BROOKS. We would appreciate that.
[The material follows:]
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DOD Responses to Recommendations made by
The Federal Data Processing Reorganization
Projects National Security Team Report
I. Office of the secretary of Defense
A Improve the effectiveness of the Department by
elevating overall information technology staff management
within the OSD organization.
o Top management involvement at OSD level has been increased.
DoD recently established a new policy on life cycle management of
automated information systems. It brings together as a group
the senior functional, ADP and telecommunications executives
in the OSD.for the purpose of reviewing and approving major
information system projects at key decision points. This
group has come to be known as the Major Automated Information
Systems Review Council and functions very much like the
DSARC which has proved effective in the weapons system area.
In this way we expect to achieve the objective of the National
Security Team Report recommendation without major organizational
disruption.
B. Increase effectiveness by extending management
responsibility for automation to encompass both general
purpose (administrative) and operational computer and
telecommunications resources.
o We still have this matter under review but, in general,
believe that the current separate bases of responsibility are
a workable structure with little, if any, duplication or over-
lapping. Efforts are underway, however, to develop common
policies, to share in common research and development, to work
toward a standard set of definitions, and to achieve a cross
exchange of techniques and management dicta.
C. Improve the Secretary's control over the computing
resource, by establishing an informal mechanism which will
provide continuing private sector expertise to DoD on key
computer/telecommunications issues.
o We have begun action to invite private industry assistance
and advice on major system developments. This type of
participation was used very effectively in our recent assessment
and redirection of the Tri-Service Medical Information
System (TRIMIS). Additionally, in our project to develop a
long range planning and technology forecasting mechanism, we
have obtained private sector participation in the various
topical areas being explored in that project.
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114
D. Strengthen the capability and role of the Defense
Audit Service in reviewing information technology projects
and requests.
o We have recently sent a memorandum to the Defense
Audit Service which requests their review of general ADP
matters during regular audits and specifically enlist
their aid in conduct of AIS management assessments referred to
in Recommendation G. below.
E. Place the operational control of DOD Computer Institute
(DODCI) within the OSD organization.
o As a result of a formal study of this matter by the DOD
ADP Policy Committee, it was recommended that (a) a fundamental
overhaul of the DODCI program be undertaken to focus on improving
the skills of DOD senior and intermediate executives to effectively
deal with the ADP management requirements; (b) the DODCI Charter
be revised to clearly reflect OSD responsibility for policy
guidance and program changes; and (c) Navy remain the Executive
Agent on a two year interim basis. Prior to the end of this two
year period DODCI will be reevaluated to determine, among other
things, the optimum placement of the Institute within DOD.
F. Major automated information systems should be included
as separate line items in the program budget, and in POM and
budget cycles.
o Necessary revisions have been incorporated in the Defense
Budget Guidance Manual to highlight and show on separate exhibits,
the cost factors applicable to each major AIS. Moreover, DOD
Instruction 7920.2, establishing the approval process for major
system requires treatment of major AISS in the POM cycle and,
if possible, in the SecDef Consolidated Guidance.
G. Adopt and enforce the life cycle management policies
now being issued.
o DOD Directive 7920.1 and DOD Instruction 7920.2 were
issued in October 1978 to establish life cycle management
policies for all automated information systems. DOD Components
are currently revising internal policy documents to conform to
the new DOD policies and are implementing them. Major AISs
were identified in September 1979 and announced to DOD Components.
Major systems were classified into 3 groups: those which require
milestone approval at the OSD level; those which were delegated
to the head of the DOD Component for milestone approval;
and those on which periodic OSD management assessments will
be conducted.
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H. Ensure that each Assistant Secretary of Defense has
one senior staff member to oversee automation issue within
functions in which he uses automation.
o Each principal SecDef assistant who has a significant
interest in automated systems has named a staff office or
official to oversee automation in a particular functional area.
I. Monitor the progress of the various DOD agencies in
their efforts to upgrade the computing career field.
o DOD Manual 1430.10-M-7 has been developed in coordination
with the DOD Components to establish policies inherent to
effective and progressive development of the careers of ADP
personnel. The manual has been approved by the Assistant SecDefs
(Comptroller) and (Manpower, Reserve Affairs and Logistics)
and is now in the implementation process.
II. Department of the Army (DA)
A. The Directorate of Army Automation should be expanded to
include the telecommunications function and consideration given
to elevating it to the full status of a Deputy Chief of Staff (DCS).
o On 1 Oct 78 the Army Automation Directorate and DCSOPS
Telecommunications were merged to form the Office of the Assistant
Chief of Staff for Automation and Communications (OACSAC). HQDA
is monitoring this new organization to assure its effectiveness.
B. The DAA (or the DCS) should immediately undertake a program
to identify critical mission functions where the absence of
redundant, or backup, computer equipment could impact on units'
readiness.
0 HQDA (ACSAC) had taken actions in 1978-79 to study the
critical mission functions that are dependent on computer equip-
ment, the impact on mission performance in the absence of computer
equipment support, and the possible avenue for providing a back-up
computer equipment capability to enhance unit readiness. The mission
areas most sensitive and dependent on computer support are in the
tactical arenas located at overseas sites, e.g., Europe, Korea.
Studies are to provide back-up computer support where necessary
to enhance unit readiness. Such studies will be continued until
acceptable solutions are identified and installed.
C. The Arm must strive to quickly set up a career field that
will permit annicer F. start in the automation career field at
t e entry level.
o The Army recently approved changes to the Automatic Data
Processing (ADP) and Communications Electronics (CE) specialties
under the Officer Personnel Management System (OPMS). The ADP
specialty was restructured and personnel management actions were
introduced to improve the utilization of newly commissioned
officers with computer science/ADP-related educational
backgrouns. The basic CE was restructed and new "Teleprocessing
Operations" functions were added to this specialty to specifically
accommodate battlefield automation requirements.
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D. The Army should review its current computer systems
acquisition procedures with the aim of reducing the time and
effort involved. The role of the Computer Systems Selection
and AS Acquisition Aenc and its contribution to tocess
s ou d be particulgarly reviewed.
o These recommendations were addressed in the Study of
Management of Automation and Communications (SOMAC) and are
being incorporated in the new AR 18-1 and the Technical Bulletin
18-100 series.
E. The Director of Automation (or the new ACS) should establish
a policy requiring that automation data processing costs, wherever
possible, be charged back to the requesting agencies.
o OMB has prepared a draft circular "Cost Accounting, Cost
Recovery and Inter-Agency Sharing of Multi-user Data Processing
Facilities" which COA commented on to OSD with OACSAC's input.
o OSD replied to OMB and OSD agrees with the basic objectives
and provisions.
o OMB expected to publish the circular in Jan 80.
o Army (COA) is planning a Cost Accounting Module in the
re-design of STAN FINS. COA (current) plans for implementing the
OMB circular hinges on the re-design of STAN FINS. However, re-do
of STAN FINS projected to take 3 years.
o Also work is being done on the Utility Reporting System
to accommodate the new requirements.
o Official statement of Army plans will await the publishing
of the OMB circular.
F. Automation costs, including tactical, MIS, intelligence-
etc, should be fully highlighted within the Army budget.
o OACSAC has developed the Army Automation Planning Programing
Evaluation System (AAPPES) which functionally portrays the Army's
Automation environment by use of a zero based automation program
and budget. AAPPES is integrated into the Army's Planning,
Programing and Budgeting System (PPBS), is used by both the Army
Staff and all Major Commands and Operating Agencies for programing
and budgeting of automation resources. The AAPPES process is
presently described in Draft TB 18-101 and will be published in
July 1980. Automation costs, including tactical, MIS, intelligence,
etc,. should be fully highlighted within the Army Budget. Automation
System, item and project cost data is collected through the AAPPES
process, made available to the Army's functional manager for
decisionmaking purposes and displayed in the Army Automation
Memorandum Budget submission to OSD.
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G. The Army should expedite implementation of its plan to
provide Automation Management Offices (AMO) at the Corps level.
0 The Combined Arms Center at Ft Leavenworth has completed
a study which examined the establishment of a Corps Automation
Management Office (AMO) and its associated missions and functions.
The study has been staffed with all interested parties in the Army.
Final recommendations were forwarded to CDR TRADOC in December.
Recommendations will include the recommendation of designating
the Signal Brigade Commander as the Assistant Chief of Staff for
Automation and Communication (ACSAC) with dual responsibility for
all automation-communications at Corps level. The ACSAC office
will include a 7-man Corps Automation Management Office. Although
the Army fully supports the immediate formating of an AMO there
is concern as to where the manpower will come from to man the new
office. Given current manning ceilings, the additional manpower
will have to come from other programs.
H. The Arm must train and assign engineers with an automation
background or training to system program offices (SPOs developing
systems containing computer sub-systems.
o This recommendation'is under study and there is no program to
report at this time.
III. Department of the Navy (DON)
A. Assure that the Navy will receive the full potential from
its present and future computer resources by assigning responsi-
bility and authorit to one individual at the level of a Deputy
Chief o Naval Operations, or a head of major staff office, and provide that he devote full time to management of the Navy
computing and telecommunications resource.
0 This individual must have authority for the overall manage-
ment of the Navy automation and telecommunications program; and for
functional management of all Navy computing resources, both general
purpose and tactical. He should also be responsible for coordina-
tion of the programs for: standards; resource sharing; assess-
ments of operational management, readiness, vulnerability, security
and privacy; and for the Navy long-range computing resources plan.
This individual should also have a close working relationship
with the Navy Senior ADP Policy Official. The Navy's present
organization structure is very close to this recommendation.
As noted, the Navy's present organization is very close to that
recommended. Since the Director, Command and Control has
responsibility for telecommunications and for both embedded and
commercially available computers, no organizational change is
considered necessary.
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B. Assure maximum innovation, with needed coordination and
effective control, of ADP resources by prescribing standard
organization structures (includin authorities, res onsibilities,
staffing criteria, etc. for use g in managing computing resources
in each command.
0 The director of the organization in each command must be
at a level high enough to be involved and to influence decisions
that affect computing within his command. He must also be fully
aware of the command's computer related costs, benefits, plans,
and the degree of the Navy's dependence on computer resources for
accomplishment of the command's missions and goals. This recommenda-
tion will assure that policy and guidance is reflected into each
command, and that Navy policies are carried out as intended.
A standard organizational structure has been established at each
of the Navy Regional Data Automation Centers (NARDACs). This
organizational structure is forming the basis for the Navy's
current effort of developing staffing standards for all Navy
automatic data processing (ADP) activities. These standards,
in turn, provide the means for achieving consistent ADP
organizations within each Navy command. As a further effort to
effectively manage the Navy's ADP resources, Functional Sponsors,
at the Chief of Naval Operations level, have been designated
for the wide variety of functions which are supported by ADP.
These sponsors provide a central point for certification of
functional ADP requirements and are essential to the develop-
ment of mid- and long-range Navy ADP plans which will satisfy
requirements which may cross normal command lines.
C. Strengthen the Navy's data processing career field, by
completing development of a revised career plan for flag officers,
to be fully implemented Navy-wide that will: a) provide at
least one Rear Admiral and one Vice Admiral for computin
specialist officers; and (b) develop a program for the progres-
sive career training for a lag officers in information
technolo mana ement principles and com uter uses. This
recommendation applies similarly to the Marine Corps.
o This recommendation is necessary to provide officers with
an incentive to develop competence in management of computer-
based functions and activities. The second should be implemented
by assigning at least 10 percent of the flag officers to attend
the executive-level seminar at the DoD Computer Institute each
year. Civilian managers should also be encouraged to increase
their capabilities in managing information technology projects
and programs.
A number of actions have been undertaken in pursuit of the
objective of enhancing the ADP career program for officer ADP
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subspecialists. These actions include the identification of a
viable career pattern for Unrestricted Line Officers, compat-
ible with development in the warfare specialty; a comprehensive
review of the ADP Limited Duty Officer and Chief Warrant Officer
billet structure and recommended improvements thereto; a review
and revalidation of all billets identified as requiring officer
ADP subspecialists; a review of the ADP curricula taught at the
Naval Postgraduate School; and a series of briefings presented
to officer detailers, officer ADP subspecialists, and United
States Naval Academy Midshipmen. It is anticipated that these
and similar actions will result in a gradual and comprehensive
enhancement of the ADP subspecialist career opportunities.
D. Follow through and complete development of a Navy Long Range
Computing Resource Plan, to assure that computing resources are
managed and coordinated throughout the Navy. Assign responsi-
mility to each command to develop its part of the Navy Long
Range computing Resource Plan; compatible with and suitable for
incorporation into the Navy-wide Plan. This recommendation applies
similarly to the Marine Corps.
o This activity should be undertaken by the individuals
described in A. and B. above, under the overall guidance of the
senior ADP Policy Official. Assign to the Chief of Naval Material
the responsibility for compiling, at headquarters level, the plan
for all CHNAVMAT commands.
0 Lack of such planning in the past has caused difficulties
with the Congress, OSD, GSA and OMB, because Navy decisions on
acquisitions of general purpose computing equipment have been
made on an ad hoc basis, and not for the benefit of the Navy as
a whole. The plan should receive concurrence from functional
users, who will be served by the data processing resource, to
assure that their concern about adequacy of service will be
addressed and that the improvements in their mission accom-
plishment will be realized. It must take into account on-going
systems that now interrelate with each other. The plan should
be updated annually to assure continued relevance. When new
data processing systems are proposed they should be reviewed in
the light of the plan.
The Department of the Navy guidelines for non-tactical ADP
planning were promulgated in July 1979. These guidelines, which
will be updated twice annually, provide broad planning goals
and direction for Navy ADP over the next 20 years. The Navy
Long Range Plan for Automated Information Systems (FY83-FY87)
has been prepared in consonance with these guidelines and will
be promulgated by January 1980. The emphasis in this effort has
been on planning by functional area. This plan was developed
with broad participation of the Chief of Naval operations staff
and includes an annex for each of the identified functional areas.
This long-range plan forms the basis of a continuing Navy planning
effort since it is utilized by the major claimants in the development
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of their detailed command (claimant) plans which will be
prepared during January to September 1980. In turn, these
detailed plans will form the basis for the Navy ADP out-year
budget projections as well as input to the follow-on long-
range plan for FY84-FY88.
E. Improve Navy management of data processing by extending
the practice of charging users of data processing services
directly for the costs of the service they receive.
o This recommendation extends the practice now followed
in the Navy laboratories, shipyards, and ordnance activities,
and embodied in the new Data Processing Service Center (DPSC)
project test. It is necessary that Navy managers who control
users of data processing have this information in order to
manage realistically. To facilitate implementation of this
recommendation may require development of Defense Department
cost allocation guidelines.
The procedures (Chargeback) for charging of users for data
processing services are now operational at NARDAC San Diego for
..all reimbursable work. In addition, Chargeback is being
utilized to obtain statistical information regarding non-
reimbursable work. Based upon its current success, Chargeback
isbeing exported to the remaining NARDACS, and it is antici-
pated that it will be utilized for billing of reimbursable
work at all NARDACs in FY81. The Navy's ADP Chargeback
Steering Group is monitoring this effort and is investigating
the possibility of extending the scope of charging for all
types of services provided and for exporting Chargeback
to other major Navy ADP sites.
F. Increase effectiveness of data processing management
by establishing mechanisms for review of data processing
facilities and of new and on-going data processing systems.
o This is needed to assure a more thorough review on a
regular basis of operating practices, systems, and performance
of computing resources. Hardware and software monitors
are required for this effort. It is essential that security,
vulnerability, and operability in wartime conditions and
under wartime transaction loads be reviewed and corrected
where necessary. The major type of review that needs improvement
is that given to new sytems proposals. These are usually
considered only from the point of view of computing equipment,
and ignore the overall system. They often receive only
cursory review at higher management levels for requirements
and feasibility. This is the major weakness in all
Government agencies; it is not restricted to the Navy. Finally,
effective mechanisms must be developed for creating systems
that involve multiple commands, since each command's
requirements are different.
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Several examples of current Navy efforts provide an indication
of the emphasis which is placed on this recommendation:
- A methodology is being developed for analysis and
monitoring of ADP activities to be used in improvement of their
performance. The prototype is being developed at the NARDACs,
for use Navy-wide, and the effort thus far has included a detailed
equipment and systems software analysis of two of the larger
NARDACs.
- A detailed and comprehensive ADP Security Manual has been
developed and has been given wide distribution, for comments,
within Navy prior to its formal publication.
- Software and hardware monitors have been acquired and their
utilization is presently being prototyped at the NARDACs._ These
monitors, along with specific procedures for evaluations, will be
available for use on ADP equipment Navy-wide commencing in early
1980.
- A study is being conducted with regard to the feasibility
of employing "back-end data base management systems," (i.e.,
equipment units to store data files separated from main processing
units). If successful, this approach could improve data base
security as well as to ease software conversion efforts associated
with hardware replacement and extend the effective life of
associated ADP equipment.
A Department of the Navy ADP review and evaluation instruction
(SECNAVINST 10462.18) is currently being revised by Naval Data
Automation Command staff, with issuance planned within 90 days.
This instruction is being expanded to include areas such as risk
management, security, and teleprocessing.
G. Implement the Navy's plan for broadening the scope and
role pf the ADP Management Steering Committee to: (a) expand
membership to include members from the research, engineering, and
systems community; and (b) shift the committee's
emp asis
toward the planning structure -- with heavier involvement in
development of the Navy Long Range Computing Resource Plan.
o This will assist in broadening understanding of the common
areas, and long range plans, of the administrative and tactical
data processing worlds -- as well as of the respective commands.
It is gratifying to see that the Assistant Secretary of the Navy
(Financial Management) is acting to make these changes in the
committee charter.
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122
status
The Navy's ADP Management Steering Committee has continued its
active role and has established subcommittees for ADP Planning
and User/Requirements/Responsibility to provide an even
broader participation in the Navy's ADP planning and policy
formulation. The guidelines for non-tactical ADP planning,
described previously, were produced directly by this committee.
In addition, the ADP Management Steering Committee, with
extensive support by its subcommittees, has been instrumental
in the development of the Navy Long Range Plan for Automated
Information Systems and in the recently issued Secretary of
the Navy Instruction (SECNAVINST 5231.1A) entitled "Life
Cycle Management of Automated Information Systems within the
Department of the Navy."
IV. Department of the Air Force (DAF)
A. Action-was taken to improve mission responsiveness
of the base level computers during wartime contingency
operations. On 17 July 1979, the Directorate of Computer
Resources initiated a study of the capability of base-level
Data Processing Installations (DPIs) to meet mission
requirements during wartime contingency operations. The
need for the study is based on our assessment that no measure
exists that could be used to determine impacts of the full
range of contingency operations on the DPI. Existing efforts
have identified requirements for a full-scale war environment,
but none have addressed the impact of a prolonged mobilization
associated with a specific contingency. The project is to
take place in three phases by geographical area (European,
Pacific, all others). The end result of this effort will
be a "capability" report for each of the geographical areas,
fall-back procedures for those automated data systems (ADS),
that would not be processed during the contingency, a set
of instructions that perpetuate this evaluation process and
procedures to ensure that ADS processing requirements are
included in Contingency Operations Plans. The assessments
of processing requirements will also serve as a basis for
evaluating the DPI wartime manning requirements. This
study is in harmony with National Security Team recommendation
D for the Air Force which deals with improving readiness.
B. The Air Force Computer Security Program Office at
Gunter AFS, AL, is developing a set of Risk Analysis/
Management Program Guidelines. These guidelines tailor
the general guidelines developed by the National Bureau
of Standards (NBS), to the Air Force environment. These
guidelines will aid Air Force managers in assessing the risk
to their ADP facilities, hardware and software and in making
cost effective choices of safeguards to reduce the risk to
acceptable levels. The risks addressed cover a broad spectrum
from weather (e.g., flood) to espionage. Included with such
guidelines will be requirements for periodic application of
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C. Further Air Force actions that are in harmony with
the general concerns expressed in recommendation E include:
o The issuing (in August 1979) of a revised Air Force
Regulation, AFR 300-8, "Automated Data Processing System
Security Policy, Procedures and Responsibilities." This
regulation includes security test and evaluation guidelines.
o The development of detailed procedures and responsibilities
for field activities in support of ADP contingency planning.
These procedures are being included in a revised Air Force
Regulation (AFR 300-6) which is currently being staffed.
o The dissemination of additional GAO Audit Standards
"Auditing Computer-Based Systems," which are effective in
January 1980, to Air Force ADP Program Single managers for
their information.
D. The Air Force ADP community's ability to attract and
retain quality personnel at all levels is an area of active
interest. Some of the recent actions include the use of
senior enlisted personnel as Data Processing Installation
(DPI) Chiefs; the creation of an ADP Career Management
Newsletter; and the attendance of senior NCOs at the Air
Force ADP staff officer course. We intend to actively pursue
this area and in this regard, some of our future activities
will include an effort to send a 51XX officer to each class
of the Defense Systems Management College beginning next
summer. In addition, the Air Force is considering a proposal
for a professional military computer management course.
As currently envisioned, this course would be directed at
the 0-5/0-6/GS-14/GS-15 level and would address evolving
technological developments, the regulatory structure governing
the management techniques and hardware/software trends.
However, the funding for such a course remains an open issue.
These efforts are in harmony with the National Security Team
recommendations H and J for the Air Force, which include
strengthening the "51XX" career field and accelerating
information technology training.
E. In the general area of improving Data Automation
Requirement (DAR) processing, several significant actions
have taken place. First, the Secretary of the Air Force
issued SAF Order No. 560.1 on 4 December 1978 which significantly
raised the thresholds associated with resource approval
authority. The raised thresholds were promulgated to Air
Force ADP Program Single Managers in a 25 January 1979
letter, thereby delegating more authority to the field.
Changes to the appropriate Air Force regulations are
currently being developed. This effort is in harmony with
National Security Team recommendation I for the Air Force,
which addresses improving the DAR processing cycle.
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F. The above represent some of the Air Force ADP
community activities which harmonize with the National
Security Team recommendations. The Air Force will continue
to pursue many avenues to improve management of its ADP
resources.
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Assessment of Vulnerability Caused by
Obsolete Computer E uipment and Systems
and/or Underdeveloped Technical Personnel
A. Department of the Army (DA)
DA has assessed the risk to DoD ability to respond to
military emergencies. During 1978-79, a Study of Management
of Automation/Communications (SOMAC) was conducted by HQDA.
This study pointed out the deficiencies in all resource areas.
Actions are being taken to correct the deficiencies. ADPE
Obsolescence (TWILITE) Program has been incorporated into the
Army Automation Master Plan. Obsolescent and saturated
computer equipment has been identified and is being replaced
as soon as possible consistent with budget constraints, e.g.,
Project VIABLE. Shortfalls in the Reserve Components and
Mobilization areas are being studied and plans are being made
to correct the deficiencies. Actions are being taken to
improve the quality and quantity of automation personnel in
the Army.
B. Department of the Navy (DON)
The reorganization team, in addition to its specific
recommendations, concluded that obsolete computer equipment
and systems, as well as underdeveloped technical personnel,
have made our military enterprise operationally vulnerable.
This is certainly an area of extreme concern, and one which
requires constant attention to assure that Navy continues
to have the equipment and personnel necessary to meet any
emergency. However, the problems cited neglect an important
aspect of ADP support, which is that this support is
absolutely essential at all times for the successful
operation of the Navy. In large measure, the ADP support
required in an emergency situation is little different from
that provided routinely. Of course certain functional areas
such as personnel, administration, and payroll will have
an ADP support requirement whose volume will expand rapidly
in the event of mobilization; and ADP support for these
system types is being planned to include this identified
mobilization capacity. In the remaining areas, it is believed
that sufficient computing capacity and adequate personnel can
be planned and implemented to satisfy current or stressed
requirements, However, a problem with ADP support, in an
emergency and especially during mobilization, is how to
provide support in the event that the primary processing
site is unable to provide the support because of equipment
failure, weather, power problems, etc. The Naval Data
Automation Command's program of providing a standard
operating environment at the Navy Regional Data Automation
Centers (NARDACs) and the development of a software
test and backup site at Newport are positive steps in
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providing a solution to this problem. Each of the NARDAC5 can
provide backup support for other NARDACs, and a large portion
of the capacity at Newport could be made available quickly to
provide support or "surge" capacity for other NARDAC work.
In recognition that standardization of hardware and operating
environment is a prerequisite for emergency or mobilization
back-up support, several Navy efforts are now being coordinated
for the replacement or development of major systems with
the goal of continuing and modernizing the present compatibility
through acquisition of modern and reliable equipment. For
instance, the Shipboard Non-tactical ADP Program (SNAP) will
place over 400 standard ADP systems in ships and key shore
activities, with systems software support coordinated from
a central site. In another major effort, the Inventory
Control Point (ICP) Resolicitation Project will replace the
obsolescent data processing systems, now in use at the ICPs,
with more modern and capable standard hardware systems. For
the benefit of the Navy stock points, a comprehensive
maintenance contract has recently been awarded which will
continue necessary support for the currently installed standard
ADP systems and maintain their compatibility until their
eventual replacement by another set of standard hardware
systems. The Navy's mid- and long-range planning process is
the major vehicle which is being utilized to identify and
develop these and additional areas where such standardization.
can make a significant contribution to ADP support.
This assessment should not be construed as supporting the
status quo with regard to obsolete equipment or poor retention
of highly qualified technical personnel. Obviously, more
modern equipment has greater relative capacity and reliability
and is less costly to operate, and often, because of
modularity, the capacity can be expanded rapidly to meet
changing requirements. The acquisition of modern ADP
equipment also provides impetus for the retention of high
calibre personnel. It is presently difficult to interest
these personnel in remaining with an organization which is not
staying current with the "state-of-the-art." For these
reasons, good management practice dictates that strong
emphasis continue to be placed on effective and responsive
replacement of obsolete ADP equipment.
The Air Force believes that there is some risk associated
with the use of computers which are no longer supported by the
manufacturer. The lack of manufacturer support of 'a computer
would tend to primarily impact the maintainability of the
system (e.g., availability of spare parts, support for
correcting errors in system software, etc.) which would tend
to have a long term effect rather than an impact on today's
ability to respond to emergencies. In addition, it is believed
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that there is some risk posed by the employment of underdeveloped
technical personnel. The Air Force has established acquisition
programs such as Phase IV to replace aging systems, and
continually seeks ways to attract, keep and develop talented
people in the Computer Resources field.
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Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
Mr. Wacker, I also want to add my congratulations to you for 31
years of service to our Government. I will personally miss your com-
ments, your succinct way of testifying, and the manner in which you
have always been open to us as to what you have said and the way you
have testified.
I have found that the information you have given us over the years
has been very helpful, lucid,.and concise. I think it has been honestly
given as well. You have called the shots the way you have seen them. I
think that has been very helpful to the committee.
I also like the way you have testified here today about this bill and
how you have analyzed it. I think what you have said is very im-
portant.
Having served as the Chairman of the Paperwork Commission, and
having listened to people talk about what the problems are in the
Federal paperwork burden, I am impressed that there are many people
in the Federal Government who do want to try to eliminate as much
as possible of this burden. I also want to take this opportunity to thank
you and the Department of Defense for the cooperation that you gave
the Paperwork Commission.
In your testimony, you have talked about the so-called Federal
locator concept. That was initiated by the DOD. That idea was
presented to the Commission. We picked it up. We ran with that ball.
Subsequent to the final work of the Commission, I met with repre-
sentatives of the DOD and OMB. I hope I some way brought them
together. I thought that what the DOD had already put into operation
was good. In the beginning, when we first got into the locator concept,
it was just in the developmental stage. But even then it was doing a
tremendous job to help find information.
That Federal locator system, I think, is a significant contribution
toward helping to reduce the Federal paperwork burden. Of course,
that is one of the major parts of this bill, which establishes it
statutorily.
I am also interested in information management. I know this bill
does cover information management, which includes ADP and
telecommunications as well as the paperwork. The question I would
like to ask is this: To what extent is DOD activity information related?
Mr. WACKER. I think it is quite clear that that is a very difficult
question to quantify. I believe your own Paperwork Commission,
at the time it attempted to quantify it, came up with a number
like $50 billion. That staggers most people except those who deal
with the Defense budget.
If anything, it may be a conservative number.
Where does information start and where does it stop? Mr. Granquist
responded to Mr. Levitas' question by giving one element of
quantification.
: We have looked at it another way in the Department in connection
with the IRCAS activities and the information review.
Over the past several years we have looked at a base that, as best
we can collect it, seems to consist of something like 10,000 reports
and 350,000 forms. I acknowledge fully that does not give a complete
picture of what is involved.
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But what is important is this. As a result of our own internal initia-
tives, we have been able to reduce those 10,000 reports by 2,000, and
those 350,000 forms by 60,000. That is roughly a 20-percent reduction
in pure paper from the base number.
Our people have tried to put a price tag on that. I have notes that
say it is $44 million. I would not stand up and attempt to swear on
a Bible as to its validity, but it is a significant saving.
As I said earlier, I think we are just scratching the surface. This is
is just one department's experience.
Mr. HORTON. What kind of benefits would be derived by DOD
from the implementation of H.R. 6410?
Mr. WACKER. From my point of view, I would say this. I. do not
intend for my comments in any way to undercut the reservations
that Mr. Granquist expressed, or some of the things he felt needed
to be looked at so far as the organizational structure is concerned.
But, I think the establishment of an office of central management
authority is very important. I regard a lot of these efforts as ad hoc
and voluntary at the moment.
While it may result in an adversary relationship, I would rather
have a single adversary in this.
Mr. HORTON. In a sense, you are like a little OMB in the Depart-
ment of Defense because you have different agencies that you deal
with.
Mr. WACKER. Yes.
Mr. HORTON. You deal with the Army, Navy, Air Force, the Marine
Corps, and so forth. Therefore, in a way, you sit in that same type of
capacity. You have been concerned about information resources
management. That is a very important part of your job.
Mr. WACKER. That is right.
Mr. HORTON. In a way, you have been in the forefront of this fight
in the Department of Defense. It is a fight that has to go on in the
whole administration. You are one segment of the administration, but
in another sense, you occupy the same role that the OMB occupies
with regard to the other Federal agencies. Therefore, you have to
manage information resources. If you do not, you are going to find
yourself in a pile of paperwork that will overwhelm you. So you have
to make some direction out of that chaos or else you are not going to
function.
Mr. WACKER. That is right.
Mr. HORTON. I assume that is what you are talking about when you
talk about how you have organized the Department of Defense. That
is a little prototype of what we can do for the Federal agencies.
Mr. WACKER. Yes. That is an excellent point, Mr. Horton. That is
an excellent observation. At times, the same sort of comments on
adversarial relationships are made within the Department.
Mr. HORTON. That is no great problem, is it?
Mr. WACKER. No, not really.
Mr. HORTON. You expect that, do you not?
Mr. WACKER. Yes, we expect it.
It, is a difference of scale and perception, probably. Within the
Department, I do have most of the responsibilities. I think it is working
well.
I would recognize and defer to others the aspects of public use
reporting when you broaden the scope to the entire Federal Govern-
ment. We are 5 percent of that. We are a small involvement.
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As for the matter of statistical policy at the overall executive level,
I defer to you and your discussions with OMB and others for that.
However, our dimensions are a bit more parochial and within the
Department I do have most of these responsibilities. I think it is
appropriate. I think it is working well.
Mr. HORTON. Thank you.
Thank you, Mr. Chairman.
Mr. BROOKS. Mr. Levitas?
Mr. LEVITAS. Thank you, Mr. Chairman.
Mr. Wacker, I read your prepared testimony with great interest. I
think it is clearly and succinctly stated. I commend you on it.
The only question I have is this. This is based on what Mr. Gran-
quist said and also in part on your testimony.
In the implementation of H.R. 6410, would there be any additional
manpower requirements which you would have to seek in order to
comply with its provisions? Have you made any estimates?
Mr. WACKER. I have thought about that since this past weekend
when I read the testimony of the Comptroller General. I think he did
attempt to make some sort of estimate at the national level.
As I see it, I cannot identify or state that there are any added or
incremental costs in our case. The functions are clearly expressed and
defined. We are largely performing them now. If anything, there may
be some modest organizational realinements required within the De-
partment of Defense, but I feel on fairly sound ground to.say that I
see no additional manpower or dollar costs involved in our
implementation.
Mr. LEVITAS. I am curious about this. Your testimony refers to the
20-percent reduction in paperwork. You made additional comments
about that.
In terms of reduction of the number of forms, I think you said
60,000; is that righTt?
Mr. WACKER. .T eS.
Mr. LEVITAS. I am curious about two things. The first is this. How do
you decide and indentify and who decides and identifies what forms to
eliminate?
Second, if it could have been eliminated as it was, then why was it
not eliminated before somebody said to eliminate it?
Mr. WACKER. That second question, on the one hand, may be more
difficult. On the other hand, it may be more simple.
The first part of the question comes to this. We have the overall
licensing responsibility within my office. Any proposal for a new form
that lays an information gathering requirement on our components
has to be reviewed by our office. We attempt to screen it more intelli-
gently now that we have the information locator system in the Depart-
ment.
No component is authorized to proceed unless we do stamp a seal of
approval on it and give it a license number.
.. Why have we found so many that were licensed in the first place?
I think that is simply the fact that we did not have a good
enough basic information gathering system to discover the redundan-
cies that exist.
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It is amazing how a new claimant's information can be satisfied
when you have a good collection system to identify that which is
already being gathered in.
Mr. HORTON. If the gentleman will yield, let me say this.
Part of the problem is this. Very seldom do people go back over and
determine that such and such is not needed. If it was started once, it
sort of goes on in perpetuity.
It is important to have a review process to determine whether or
not information is still current and still needed. The central locator
system can help in that regard.
Mr. WACKER. If I may, let me say this. I have observed this over
my years. We have systems development, or refinement, from time
to time, both within the legislative and the executive branch. For
example, within the Congress you established a new congressional
budget process in 1974.
The present administration established a new budgetary procedure
called zero-based budgeting.
As these come in, there is a natural tendency to do this. It may be
a proper approach. We do not let go of an existing process until we
have installed and debugged the one that is supposed to be the follow-
on.
I am finding right now that our whole presentation of the budget to
Congress results in a tremendous amount of information. I would be
the first to say that some of that still is a vestage of our earlier system.
Some of it is a new system.
We have to follow up on this. The followup function is very, very
important. You will find this overlap of systems coming in.
Unfortunately, we do not always drop out the information data
that has been collected from the so-called predecessor systems.
Mr. LEVITAS. Thank you.
Thank you, Mr. Chairman.
Mr. BROOKS. Mr. Levitas, thank you.
Gentlemen, we want to thank you for your testimony. We wish
you every success, Mr. Wacker, in your future.
Mr. WACKER. Mr. Chairman, I found that my granddaughter did
not know much about XM-1 tanks, but she understands Sesame
Street and the Muppets. [Laughter.]
Mr. BROOKS. Thank you.
Our next witness is Frank J. Carr. He is Commissioner of the
Automated Data and Telecommunications Service within the GSA.
That office oversees Federal acquisition, lease, use, retirement, and
sale of data processing and telecommunications equipment and
services. It also administers the Federal procurement and property
management regulations for these services and equipment.
Previously, Mr. Carr has held a wide variety of management
positions in private industry and in Federal, State, and local govern-
ment administration. He is a graduate of the University of
Pennsylvania. He studied at the Wharton School and the Harvard
Business School.
We are delighted to have him here. You may proceed.
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STATEMENT OF FRANK J. CARR, COMMISSIONER OF AUTOMATED
DATA AND TELECOMMUNICATIONS SERVICE, GENERAL SERVICES
ADMINISTRATION
Mr. CARR. Thank you, Mr. Chairman.
Before I start, I would like to extend Mr. Freeman's regrets for not
being here today. We did discuss the legislation, and the remarks I
make, although they focus principally on the activities of the Auto-
mated Data and Telecommunications Service, do reflect the GSA's
viewpoint on the legislation.
I have some prepared remarks which I will submit for the, record.
I would like to highlight some of them and make some additional
remarks that are prompted by the testimony I have heard this
morning.
Mr. BROOKS. Without objection, your prepared statement will be
inserted in the record.
[See p. 137.]
Mr. CARR. Let me begin by pointing out that there has been some
question raised about the act, regarding the title of it, the Paperwork
Reduction Act of 1980.
Let me comment on the fact that although the principal remarks
this morning were focused on paperwork reduction as it impacted on
the public, that there is a lot of other paperwork that goes on in the
Federal Government that this act will have an impact on.
The Federal Government has 12,000 computers that are turning
out a lot of paperwork. For all of the automated systems we have,
we have an awful lot of people who are in the middle of this system
trying to pass paper back and forth almost from one computer to
the other.
Some of the problems that we are faced with there, in fact, will be
addressed by the bill.
We also have a lot paper that flows back and forth that is unneces-
sary, or could be eliminated by better communications. There are
other objectives, then, that would be satisfied by this act.
The act also might have been termed the Information Management
Act of 1980 because it does address the subject of information manage-
ment as well as paperwork reduction.
In my own mind, I will distinguish between the two by referring to
paperwork reduction as an objective that we are trying to accomplish.
Information management is the broad function which can be used to
satisfy that objective, as well as some others.
The other objectives, for example, could be to increase productivity,
maintain a more stable
Mr. HORTON. You and I know what information management
means, but the general public does not know. If we call this the
Information Act of 1980, people might think we were trying to manage
information that will be fed to them on a PR basis, or something like
that.
I know what you are trying to say to us, but paperwork reduction
is something people can relate to very quickly.
Mr. CARR. I realize the explanation I am giving is not necessary so
far as the committee is concerned, but what I am really giving you is
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the explanation I have given to others who have asked me why in the
world is this being called the Paperwork Reduction Act. I have given
them the sane explanation.
I should also like to mention that the focus of most of the comments
this morning tended to address solving current problems, or problems
which existed in the past and that we are still living with.
An important aspect of this bill is to create an environment that
will prevent future problems from occurring. That is the major focus.
That is one of the ones I am principally interested in.
Back in June and July 1976, this committee held hearings. Mr.
Chairman, if you do not mind, I would like to recall some of your
closing remarks.
You mentioned :
GSA has failed to enforce regulations and restrictions in the delegation of
procurement authority. It has failed to provide ADP management guidance to
user agencies, which their role under the Brooks Act dictates.
You then said:
The OMB, charged with policymaking responsibility under the law, has failed
to establish concise, clearcut policy and, to the extent that some policies have
been issued, has failed to provide adequate direction in their enforcement.
You stated :
The NBS, responsible for the development and issuance of standards, has failed
to provide the Government with necessary hardware and software standards.
Finally, you said :
The user agencies, in turn, have consistently failed to cooperate with GSA
when procuring ADP equipment.
You apparently were in a generous mood that day and included
everybody in your remarks. [Laughter.]
The President's Federal reorganization project in the ADP portion
in 1977 and 1978 also examined what was happening in the ADP
area. They pretty much found that matters had not changed
substantially.
Specifically, they found that leadership from the Federal informa-
tion policies were fragmented. In the agencies there was little commit-
ment at the top management level. They encouraged GSA to improve
and streamline the procurement process and to develop and recognize
procurement competence in the agencies.
We have taken certain steps. I will just mention a few of them and
relate them to the bill, H.R. 6410. It emphasizes the importance of
standards and compliance with those standards, particularly for soft-
ware and computer languages.
This is a major problem we have in the acquisition and utilization
of computers.
The cost of hardware has steadily been going down. The cost of
system development software has steadily been going up. The problem
in the cost conversion from old systems and old computer equipment
to new has been a major problem that we have been faced with.
We have implemented changes in our organization to do a better
job in enforcing compliance with standards. We have established an
Office of Software Development. The nucleus of that was the Federal
Compiling Testing Center, which the Navy, for some years, has oper-
ated and has provided us with a corps of extremely capable people.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
They presently validate compilers provided by vendors.
We are also establishing a software conversion support center, which
is intended to aid agencies in planning for conversions.
H.R. 6410 also provides for the development and implementation
of the comprehensive Federal policies, principles, standards, and
guidelines.
One of the things you find when you start to look at this area is
that you have a large number of divergent and competing interest
groups.
You have the data processors, the statisticians, word processors,
records managers, designers of reports and questionnaires, communi-
cation specialists, office managers, and I am sure we could add others
to this list.
One of the major benefits of this particular legislation is that it is
bringing together all of the separate interests in a focused manner.
That, by the same token, is one of the problems that will have to be
faced in implementing the bill because there is a tendency to resist this
bringing together.
H.R. 6410 also requires the head of each agency to designate a sen-
ior official who shall, among other things, have the responsibility and
accountability for any acquisitions made pursuant to a delegation of
authority from GSA under the Brooks Act.
As was mentioned earlier, Congress may want to consider having
more than one person to be identified. If that is the case, there probably
should be one of those individuals who would be designated as the sen-
ior representative for the agency.
H.R. 6410 also requires OMB and GSA to develop a 5-year plan for
meeting the Federal Government's ADP requirements. That is a very
ambitious objective.
As I have pointed out, you may want to consider making that a
second year objective instead of the first year objective. You also
might point out that the OMB and GSA could not, in fact, develop
such a plan without the full participation and initiative from the
agencies.
Finally, with regard to records management functions principally
performed in the National Archives and Records Service, the GSA
supports
Mr. BROOKS. Excuse me. We have had a second bell on the floor for
a vote. We will, therefore, have to go to the floor. We will be right back
after a brief recess.
[Recess taken.]
Mr. BROOKS. The subcommittee will reconvene.
Mr. Carr, please continue.
Mr. CARR. In conclusion, Mr. Chairman, let me repeat this.
H.R. 6410 addresses many longstanding problems. It focuses Gov-
ernment-wide information policy and standards into a single focal
point. It will make the practices and procedures of each agency promi-
nent. It requires high level attention to both internal efficiency and
the paperwork burden on the public.
It gives added impetus to the programs of GSA, particularly ADTS,
to achieve its responsibilities under the Brooks Act.
I would like to point out, Mr. Chairman, going back to the original
passage of the Brooks Act, the legislative history shows that the deci-
sion was made not to statutorily define ADP equipment. The reason
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for that was the feeling that we really did not understand what the
future changes would bring in the marketplace.
Since that time, there has been a significant change in the market.
There have been things like proprietary software programs and tele-
processing services and many additional ways in which agencies can
satisfy their ADP requirements.
The Brooks Act established a framework within which the Federal
Government could address the new means of satisfying its require-
ments.
Similarly, H.R. 6410 has to be viewed in that light. It provides a
management system that should not only help us to solve the prob-
lems we have today, but will provide the framework for solving the
problems that we cannot define today, although we are sure to be faced
with them in the future.
With that, Mr. Chairman, I thank you for this opportunity to
testify. I have some technical points which I would like to discuss
later with your staff. I am available to answer your questions.
Mr. BROOKS. We appreciate your comments or any technical points
you might want to raise.
I have one question.
Agencies are certain there is no need for strengthening central
management to improve the use of information technology. In your
review, have you found patterns in present practices that are attrib-
utable to unfocused leadership?
Mr. CARR. Yes, sir, I believe testimony earlier today, and in your
last hearing pointed out some of these. I mentioned in my comments
today that one of our significant problems is in the conversion area.
Most of the problems that we have are the result of poor software
management practices. In turn, many of those arise as a result of a
failure within an agency to define what requirements are for infor-
mation and which are to be met.
We tend to respond in a quick fashion to immediate needs from
many different parts of agencies. Therefore, the high-level attention
to planning and the definition of requirements and making the kinds of
judgments about what will be done and what will not be done will
solve many of the problems that we are faced with today and that you
find prevalent in many of the agencies.
Mr. BROOKS. Could you give us some illustrations of how better
information management and more effective use of information tech-
nology can improve Government operations?
Mr. CARR. I think, if I can use the testimony today, that there is
the idea of establishing a budget for paperwork. OMB has established
that. That is an aspect of information management. It is a way of
approaching the problem of controlling just how much of a burden do
we put on the public.
In virtually every agency, there are opportunities to improve the
effectiveness of the services which that agency delivers. In almost
every case I have run across within agencies there is a great deal of
paperwork burden present. The paperwork is associated with com-
puterized systems.
I think the bill will focus management. attention on what is the end
objective we are trying to satisfy and how do we satisfy the mission of
the agency and how do we properly allocate resources to meet those
information needs.
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Mr. BROOKS. In your remarks you mentioned agency resistance to
GSA's reclassification of commodities from the Federal Supply
Service-FSS-to the Automated Data and Telecommunications
Service-ADTS-both within GSA. Can you explain to this subcom-
mittee just why agencies want to limit their thinking to large-scale
ADP systems rather than managing information technology in a
broader and more comprehensive fashion?
Mr. CARR. The reason for this lies in the fact that information
management has many different facets. The diverse interests I men-
tioned earlier among people who consider themselves word-processing
experts and people who consider themselves records managers and the
ADP people and the communications people-all these different facets
are what can be broadly called information processing.
The focus of this bill and the focus of our reclassification effort, i;,
to bring together these things that relate to each other and that really
should be working in concert to satisfy agency objectives.
Therefore, as you start to bring these diverse interests together,
there is a feeling that either someone is going to be riding herd on
what is being done, or that one group is taking over the turf of another
group.
Very specifically, the tendency is to feel that the ADP people in
the agency, because they represent generally the largest numbers and
the ones with the biggest budget, are taking over everybody else's turf.
Therefore, a lot of the resistance is not the agency itself, but it is
internal to the organization and from the people down in the organiza-
tion that generate the resistance.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman.
I want to thank Mr. Carr for his testimony. I think the chairman has
covered most of the information I wanted to ask him about. I have
no further questions.
Mr. BROOKS. Mr. Carr, we want to thank you for your testimony.
[Mr. Carr's prepared statement follows:]
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STATEMENT OF
FRANK J. CARR
COMMISSIONER, AUTOMATED DATA & TELECOMMUNICATIONS SERVICE
GENERAL SERVICES ADMINISTRATION
SUBCOMMITTEE ON LEGISLATION AND NATIONAL SECURITY
COMMITTEE ON GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
I am pleased to appear before your Subcommittee today to discuss
H. R. 6410, the "Paperwork Reduction Act of 1980. " The bill contains
remedies for some longstanding problems in Federal management
policies relating to automated data processing equipment (ADPE),
telecommunications, records management, and related technologies.
In June and July of 1976, almost exactly one year before I became
Commissioner of the Automated Data and Telecommunications Service
(ADTS), this Subcommittee held hearings to review the administration
of Public Law 89-306. With your indulgence, Mr. Chairman, I'd like
to recall some of your closing remarks for those hearings :
"... GSA has failed to enforce regulations and restrictions
in the delegation of procurement authority. It has failed to
provide ADP management guidance to user agencies, which
their role under the Brooks Act dictates."
"The OMB, charged with policymaking responsibility under
the law, has failed to establish concise, clearcut policy and,
to the extent that some policies have been issued, has failed
to provide adequate direction in their enforcement."
"The NBS, responsible for the development and issuance of
standards, has failed to provide the Government with necessary
hardware'and software standards."
"The user agencies, in turn, have consistently failed to
cooperate with GSA when procuring ADP equipment."
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In their studies during 1977 and 1978, the President's Federal
Data Processing Reorganization Project found conditions to be much
as you described them in your earlier remarks. They found leader-
ship for federal information management policies unfocussed and
fragmented. In the agencies, they found little committment or top
management involvement in effective utilization of information
technology. They encouraged GSA to improve and streamline the
procurement process, and to develop and recognize procurement
competence in the agencies.
There are some signs of progress, Mr. Chairman,' that I'd like to
report. Although I'm proud of our accomplishments, I'm personally
convinced that much more could be done, particularly if the strong
leadership envisioned by this bill can be realized..: _
H. R. 6410 emphasizes the importance of standards and compliance
with those standards, particularly for software and computer languages.
This emphasis is appropriate for two significant reasons : first, the
costs of developing and maintaining software probably exceeds the cost
of hardware at nearly every federal installation ; second, the difficulty
and cost of converting software from one kind of equipment to another
inhibits full competition between manufacturers of equipment or between
alternative sources of computer services.
In recognition of this problem, ADTS has formed the Office of Soft-
ware Development, which has two components : The Federal Compiler
Testing Center and the Software Conversion Support Center.
The Federal Compiler Testing Center does not establish standards
for computer languages, but does certify whether cothpilers meet
required standards. Herein lies a problem which we, alone, cannot
solve -- the Federal Government uses many computer languages
COBOL, FORTRAN, PL/1, BASIC, ALGOL, PASCAL, APL,
and others -- by and large we have no federal standards for many of
the languages that we use, so our programmers use many conflicting
variations or dialects that cannot be understood by other systems.
The Software Conversion Support Center, which we have recently
created, will help agencies plan for conversions from one system to
another and will lay down basic principles that will minimize recurring
problems. We are redrafting our Federal Procurement Regulations and
Federal Property Management Regulations to describe both the respon-
sibilities of this new office and the responsibilities of Federal agencies.
The resources of our office could never be adequate to act on more than
a selective basis -- I am convinced that their effectiveness would be
multiplied many times by the strong endorsement of their objectives
that is provided by H. R. 6410.
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Information management is a concept as volatile and changing today
as the concept of data processing was 15 years ago when the Brooks
Act was passed. H. R. 6410 will lead to the integration of many
divergent and competing interest groups under comprehensive
Federal policies: data processors, statisticians, word processors,
records managers, designers of reports and questionnaires,
communications specialists, and office managers are representative
interest groups that must rely upon information processing technology
to achieve future productivity gains. For many yearn it has been
evident that the branches of information processing technology were
converging, yet little more than lip service has been paid to the need
for consistent, central management or policy direction. -H. R. 6410
not only recognizes these technologies as being related, but also -
provides for the development and implementation of comprehensive
federal policies, principles, standards, and guidelines.
GSA has taken a step in this direction. As a result of a multi-year
study, about one year ago, ADTS became responsible for managing
supply contracts and for providing procurement direction for all
communications and general purpose data processing equipment.
Previously, these responsibilities had been shared with the Federal
Supply Service. At the same time, we found a lot of equipment we
thought should be managed under the Brooks Act that was classified as
laboratory, photographic, or office equipment. Subsequently, we have
transferred these items into contracts which we manage. We have also
been working with the National Archives and Records Service to offer
consistent guidance to Federal agencies for the management of this
reclassified equipment. We have issued a bulletin to all agencies
explaining the regulations as they apply to word processing. We hope to
complete this year a rewrite of our regulations to encompass the complete
concept of "office automation."
Frankly, Mr. Chairman, that reclassification has proven to be an
unpopular decision on our part and one that has caused unrest in a number
of agencies. Tlere are many agencies that don't like the discipline of
ADP regulations or our emphasis upon competition. Many agencies
resist the notion that office automation, data processing, and communications
are even related. I see in H.R. 6410 an affirmation of the similarities
of these technologies and a direction to manage these tools coherently.
For several years ADTS has had a concept of "agency certification!'
in which agencies with demonstrated procurement competence and a
clean track record would be granted much broader discretion, with less
direct GSA involvement in their procurements. This theme was also
picked up by the President's Reorganization Project and called "earned
autonomy. "
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Fundamentally, this concept is an appealing one, although not one
that can be implemented except gradually. In 1978, we revised our
procurement regulations to create a "blanket delegation of authority"
to agencies up to a threshold of $300 thousand for competitive
acquisitions. This was a six-fold increase over their prior limitation
of $50 thousand. I have noted with interest that there is no consistent
pattern among agencies in how they have parcelled out this newly granted
authority. We have also found that most agencies are disturbed about
assuming responsibility for procurement decisions; they would like to
buy whatever they want and have GSA available as an excuse for any
inefficiencies. This is particularly true for those items.of equipment
recently transferred into our jurisdiction. Since these items had been
on "mandatory" Federal Supply Schedules, the prevalent practice had
been that these items had been procured by low-level personnel with
only nominal documentation to support their contracting actions. As
a result of our changes, these agencies will be using higher level
contracting officers and documenting their decisions more fully. Many
agencies have complained to us that they haven't the personnel resources
to comply with our procedures. I have not yet seen any hard figures
from any agency, when I do then we may be able to work together to
minimize hardships during this transition period. These are several
topics for our continuing study.
H.R. 6410 requires the head of each agency to designate a senior
official who shall, among other things, have the responsibility and
accountability for any acquisitions made pursuant to a delegation of
authority from GSA under the Brooks Act. The designation of such
an official will, I think, clarify many confused lines of communication
between ADTS and our clients and enable us to proceed, where warranted,
much more rapidly in experiments with agency certification.
I would also expect these designated officials to become advocates
within their agencies for productive applications of technology. I
would hope this official is able not only to promote effective uses,
but also to curb such excesses as noticed by the GAO last spring in
their word processing study, when they found evidence of unjustified
acquisitions and underutilized equipment.
H. R. 6410 also requires that the OMB and GSA develop a five-year
plan for meeting the data processing and telecommunications needs of
the Federal Government. Such a plan is an ambitious undertaking and
you may wish to consider making that an objective for this new office's
second year, rather than its first. I would look forward to such a plan
as a roadmap and information base that would make ADTS more effective
and responsive in providing for the needs of the agencies.
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With regard to the records management functions of the Director under
Section 3504(e) of the bill, we believe that having the authority and support
of OMB behind GSA's records management inspection program will have
a very positive effect on Federal agencies' commitments to improve
records and information management practices. Similarly, the require-
ment in section 3513 that OMB selectively review at least every three
years the information management activities of each agency will permit
a broader review than is presently undertaken. We also are pleased with
the increased emphasis being placed on the annual report to OMB and
Congress on the results of inspections.
In conclusion, H.R. 6410 addresses many long standing. problems:
it provides for focussed government-wide information policies-and
standards; it makes the practices and procedures of each agency
prominent and requires high-level attention to internal efficiency and
the paperwork burden on the public; and finally, I believe it gives
added impetus to the programs of GSA to achieve its responsibilities
under the Brooks Act.
I thank you, Mr. Chairman, for the opportunity to testify on this
bill. This concludes my prepared statement. I have a few technical
suggestions for the bill which I will be happy to discuss with your
staff. I would be pleased to answer any questions which you or other
Members of the Subcommittee may have.
61-222 0 - 80 - 10
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Mr. BROOKS. Let me say that concludes today's hearings. We will
continue hearings on this matter on Tuesday, February 26, at 10 a.m.
The subcommittee stands adjourned.
[Whereupon, at 11:30 a.m., the subcommittee adjourned, to recon-
vene at 10 a.m., Tuesday, February 26, 1980.]
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PAPERWORK REDUCTION ACT OF 1980
HOUSE OF REPRESENTATIVES,
LEGISLATION AND NATIONAL SECURITY SUBCOMMITTEE
OF THE COMMITTEE ON GOVERNMENT OPERATIONS,
Washington, D.C.
The subcommittee met, pursuant to notice, at 10:21 a.m., in room
2154, Rayburn House Office Building, Hon. Jack Brooks (chairman of
the subcommittee) presiding.
Present: Representatives Jack Brooks, Dante B. Fascell, Fernand J.
St Germain, Elliott H. Levitas, Frank Horton, and Arlan Stangeland.
Also present: Eugene F. Peters, staff director; Cynthia W. Meadow,
professional staff member; Linda Shelton, office manager; Mary
Oliver, secretary; William M. Jones, general counsel; Elmer W.
Henderson, senior counsel; James Lewin, professional staff member;
Robert Brink, professional staff member; John M. Duncan, minority
staff director; Stephen M. Daniels, associate minority counsel; James
McInerney, minority professional staff; and J. P. Carlson, minority
counsel, Committee on Government Operations.
Mr. BROOKS. Today is the final day of hearings on H.R. 6410, the
Paperwork Reduction Act of 1980, and the subsequent markup of
that bill. In our prior 2 days, we heard testimony from administration
witnesses and a former IRS Commissioner. They all supported the
bill; the OMB in stating its support said that the legislation would
provide it with some badly needed tools to improve the management
of Federal information. Our witnesses this morning are appearing
as a panel of private citizens representing an association concerned
with information management. Mrs. Frances E. Fuller of Houston,
corporate records administrator for Coastal Corp., is chairman of the
Legislative Affairs Committee of the Association of Records Managers
and Administrators. Mr. Daniel Moser is cofounder of the Association
for Federal Information Resources Management. He has worked in
various capacities in the Federal Government; from 1964 to 1966,
he was staff management consultant with the D.C. government. He is
an innovator in the field of information resources management and
has been active in this area since his retirement from Government
service. Mr. Carl A. Beck is the past chairman of the Business Advisory
Council on Federal Reports, president of a small Pennsylvania cor-
poration pioneering in the application of electronic data processing
methods of inventory manufacturing and engineering problems affect-
ing small business. I understand that you each have a statement. I
have read them. If you will submit them for the record, we'll be de-
lighted to hear basically additional comments that you might have.
And, I might say in advance that I thought that the statements
were informative and helpful, generally constructive and certainly
supportive of this legislation.
(143)
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Mr. HORTON. Mr. Chairman, just so the witnesses will know, I've
read the statements also. They were furnished to me last night, I
read them, and I think that they are excellent statements.
Mr. BROOKS. Mr. Moser, we will start in that order with you and
work across.
STATEMENT OF DANIEL MOSER, COFOUNDER, ASSOCIATION FOR
FEDERAL INFORMATION RESOURCES MANAGEMENT
Mr. MOSER. Yes, sir, thank you. My name is Daniel Moser and I am
here to testify in support of H.R. 6410 representing the Association
for Federal Information Resources Management--AFFIRM-which is
a professional association of Federal employees joined to pursue the
objective to improve the management of the information systems and
resources of the Federal Government. The basic concept of AFFIRM
is to provide a forum for the expression of views of professionals in all
aspects or components of Federal information systems and resources
management as individuals and not as representatives of employers.
AFFIRM views Federal information systems and resources manage-
ment as including the following aspects or components: ADP, paper-
work, records, library and technical information, FOI and privacy,
printing and publications, information security, and related fields. The
most important thing that AFFIRM wants to support in this bill is
the broad, coordinated and integrated approach to information
systems and resources management in the Federal Government, an
approach which was sorely lacking before the reports of the Commission
on Paperwork and the introduction of the legislative predecessors of
H.R. 6410. I want to emphasize several of the points that I have in my
written statement.
We support the bill basically because of its broad, integrated, and
coordinated approach to information systems resources management
in the Federal Government. As a personal note in that connection, I
want to add that this promises to be the best piece of legislation for
improving the management of Federal bureaucracy that I have seen
in over 30 years of working from within to improve the management of
that bureaucracy. As good as the proposed legislation is, I think it can
be strengthened. One way of strengthening this would be to improve
its coverage to include library and technical information services. This
is an area of the Federal Government which is virtually leaderless at
the present time and needs greater attention to be integrated into the
whole field. I also suggest, as being appropriate for specific inclusion,
the printing and publication function in executive agencies. Third, the
organizational aspects of the legislation should be, at least, maintained
and preferably strengthened. The statutory office attached to OMB
should be the absolute minimum. I won't go into all the details of why
I think this is necessary, but I will emphasize to the committee that the
suggestion for a separate management system office was strongly
endorsed by the Federal Government's paperwork and records
management community at the Federal Records Management
Conference in 1978.
In the interest of time, I'll skip to my final paragraph which is not
included in my prepared statement.
Mr. BROOKS. Good.
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Mr. MOSER. I applaud you gentlemen, your staffs, and all the
unsung and quiet heroes in GAO and executive agencies who con-
tributed to this legislation.
Mr. BROOKS. I have a question, too. In your testimony you spoke of
the 20 to 1 return on investment, of the dollars invested in the
functions established by this bill. How did you calculate that?
Mr. MOSER. Mr. Chairman, that is a general rule of thumb I use
based on my own experience. However, other individuals, agencies, or
consulting firms may use different bases or approaches. For example,
it is a fairly common estimate that an intensive management review
of almost any ongoing manpower-intensive operation that has not
been subjected to a thorough analysis in, say, 3 to 5 years can reduce
its manpower requirements for the same output by about 10 percent.
It can also at times discover gross understaffing as a cause of opera-
tional ineffectiveness. Another type of example: During my last tour
of duty, I initiated a number of departmentwide paperwork im-
provement projects. Two of these projects, when completed over a
total elapsed time of about 2 years, resulted in initial direct savings of
over $1 million in space, equipment, postage, and related costs. This
does not take into account the recurring nature of those savings nor the
manpower savings which resulted from improved operations. In this
case, the direct additional investment probably came to about $50,000.
A relatively higher level of such results should be expected from the
work of an effective central management and analysis systems office
with the entire Federal bureaucracy as its scope.
[Mr. Moser's.prepared statement follows:]
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146
Statement in Support of H.R. 6410
My name is Daniel Moser. I am here to testify in support of H.R. 6410
as an originator and co-founder of the Association for Federal Information
Resources Management (AFFIRM). AFFIRM is a professional association of
federal and ex-federal employees who have joined to pursue the objective
"to improve the management of the information systems and resources of the
federal government". The basic concept of AFFIRM is to provide a forum
for the expression of views by professionals in all aspects or components
of federal information systems/resources management, as individuals and
not as representatives of employers.
AFFIRM views federal information systems/resources management as including
the following aspects or components: ADP, paperwork, records, library and
technical information, FOI and Privacy, printing and publications, infor-
mation security and related fields.
AFFIRM was founded to promote a broad, coordinated and integrated approach
to information systems/resources management in the federal government, an
approach which had been sorely lacking before the reports of the Commission
on Federal Paperwork and the introduction of the legislative predecessors
of H.R. 6410.
That is why AFFIRM strongly supports H.R. 6410: it affords the first real
opportunity in the history of the internal management of the federal govern-
ment for a broad, coordinated and integrated program approach to information
s:'stems/resources management. We need not dwell on the deficiencies of
the past and the existing situation, other than to say that H.R. 6410 is
an admirable corrective. It is truly landmark legislation, and should take
its place along with.other watershed legislation such as the Budget and
Accounting Act of 1921. As a personal note, I add that this promises to
be the best piece of legislation for improving the management of the federal
bureaucracy that I have seen in over 30 years of working from within to
improve the management of that bureaucracy.
As good as the proposed legislation is, there is still room for strengthening
its provisions. First, the "Purpose" section of the bill would be greatly
strengthened if it included an additional statement of Congressional policy
officially adopting or endorsing information resources management as the
basic program approach in this field. Second, the functions covered by the
legislation should include library and related scientific/technical informa-
tion activities. This functional area is virtually leaderless at the
governmental management level, and is an integral part of a complete informa-
tion systems/resources program approach.
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Third, the organizational aspects of the legislation should be at least
maintained and preferably strengthened. A statutory office attached to
OMB should be the absolute minimum. Preferable would be assignment
of responsibilities under H.R. 6410 to a separate management systems and
analysis office at the governmental level. Governmental-level responsibility
for management systems and analysis work has been the responsibility of
the Budget Bureau/OMB for at least 40 years. Except for a brief period in
the 1940s, BOB/OMB has seriously neglected that responsibility. For over
30 years BOB/OMB has been trying to manage the federal bureaucracy thru
the budget process, and it has failed miserably. The internal federal
management systems and analysis function has fallen into disuse and dis-
repute under the lack of BOB/OMB leadership and support.
Internal management improvement of the federal bureaucracy simply cannot
be achieved effectively thru the budget process. It requires a very
different substantive analytical approach based on the principles of
scientific management, systems analysis and organization and methods.
The budget process and organization cannot or will not provide this approach.
For this basic reason, it is suggested that the responsibilities under
H. R. 6410 be assigned to a separate Office of Management Systems, along with
other government-wide and governmental-level management systems and analysis
activities. This suggestion was strongly endorsed by the federal govern-
ment's paperwork and records management community at the 1978 Federal
Records Management Conference at Fredericksburg, Va. The conference partici-
pants also strongly endorsed information resources management and most
related recommendations of the Commission on Federal Paperwork. We did this
over the implicit opposition of OMB and GSA/NARS.
Those of us in information systems and resources management in fields other than
ADP are concerned with what we perceive as attempts toward ADP hegemony over
the entire field of, information resources Management. ADP is only one
segment of this field, but in agency after agency responsibility for the
total function has been assigned to or absorbed by the ADP activity.
H.R. 6410 itself tends to provide for coordination and integration of the
several components of the total information resources management function
as equals, but a provision in the bill clearly stating such a Congressional
policy would be immeasurably helpful when it comes to actual administration
of the program.
Finally, there are bound to be criticisms of the putative cost of the
legislation as stated in Section 3520:' If such a provision were not in the
bill, there would be noway that OMB would authorize such a level of expendi-
ture. And that level of expenditure is probably the rock-bottom minimum
for the effective initiation, development and execution.of the program. A
simple return-on-investment analysis will show why. Typically, every dollar
of an adequate investment in such management improvement activities will
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return at least $20 in hard-dollar, annual, recurring savings. Over a period
of 5 to 10 years, the savings from effective execution of the H.R. 6410
program would save literally billions of dollars out of the federal budget,
and additional billions in expense placed directly on the American public.
The problem in achieving these savings will be in forcing 0MB and agencies
to make the initial investment. No undertaking in the world can be viable
without an adequate initial investment. But federal agency managements
typically adamantly refuse to make the investments in management improve-
ment activities necessary to achieve effective organization and operations,
and to generate billions of possible savings. Congressional appropriations
committees' help will be needed to accomplish this.
Finally, I want to say in closing that it is indeed heartening for a 40
year student of political science and a 30 year practitioner in public
administration to see this very positive and practical initiative for
improving the federal bureaucracy emerge from the legislative branch of
government.
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STATEMENT OF FRANCES E. FULLER, CHAIRMAN OF THE LEGISLA-
TIVE AFFAIRS COMMITTEE OF THE ASSOCIATION OF RECORDS
MANAGERS AND ADMINISTRATORS, INC.
Mrs. FULLER. Good morning, Mr. Chairman, and members of the
subcommittee. I represent the Association of Records Managers and
Administrators as chairman of the Legislative Affairs Committee.
With me today is Teresa Neugebauer, a member of our committee.
Ms. NEUGEBAUER. Thank you.
Mrs. FULLER. ARMA is a nonprofit professional association formed
to promote interest in records and information management. We
furnish a source of guidance for the approximately 7,000 members we
serve nationwide. The testimony we are presenting today is ARMA's
first. We are pleased to support H.R. 6410, the Paperwork Reduction
Act of 1980. We believe this legislation is representative of a national
trend to reappraising the role of Government and the effect of regula-
tions on the private sector. Our association lauds the work being
done by this committee to address the serious problems we have
encountered. We believe that the objectives of H.R. 6410 address for
the first time and create the basic authorities and accountabilities
to exercise badly needed control over the reporting and record-
keeping regulations which have become a $100 billion a year burden
to the private sector.
You feel that the authorities delegated to the Office of the Adminis-
trator are fair and necessary to insure an impartial and objective
assessment of the paperwork burden placed on the private sector.
We feel that the division of responsibility is realistic and workable
and will be instrumental in developing a genuinely participatory
information-handling function for the agencies and the general public.
This will provide adequate participation and review by the Office of
Federal Information Policy. We would like to stress our desire to
conclude compliance costs as a major factor in evaluating record-
related regulations. On page 4 of our prepared statement is an analysis
prepared by OMB. This data is a little bit dated but it indicates that
well over 130 million man-hours a year are used to complete Govern-
ment required forms. Translating that into today's wage prices, this
comes to between $814 million to over $1,600 million. As you know,
the Paperwork Commission found that this boils down to over $500
annually for every man, woman, and child in the United States.
Now, that's plenty, but that's not all. No cost equation is complete
without the factor of retention and storage costs. Every company in
the United States has space that it uses exclusively for this purpose.
It is not unusual to find companies paying as much as $60,000 a year
to store records needed to comply with the requirements which affect
their organization. Storage costs are often a hidden factor, not rec-
ognized when computing reporting requirement compliance figures.
A major problem is the often vague or ambiguous nature of the
regulations themselves.
If the Administrator of the Office of the Federal Information Policy
could accomplish only one thing, in our opinion, it should be to sim-
plify and clarify the recordkeeping and retention period regulations.
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The average citizen should be able to understand these regulations
without specialized training. We believe that if an agency has the right
to call for the creation and maintenance of records and information,
it likewise has an obligation to provide meaningful retention periods to
meet its requirements. Because retention periods are often unspecified,
vague, or difficult to determine, we are put in the position of having
to keep too many records for too long. Records managers trying to bal-
ance equipment, personnel, and storage costs of retention against civil
or criminal liabilities for premature destruction have a difficult decision
to make. The risks of premature destruction are too great to offset the
tremendous costs and personnel burden they reflect. We are hopeful
that the Federal information locator system can be used to address
this problem. Language and the Paperwork Reduction Act allows the
general public to have access to its indexing system. We are hopeful
that the index may be developed to include not only data profiles and
reference to the agency which requires them, but a reference to whether
or not the named data is a record to be filed with the agency or to be
kept subject to audit. We are especially hopeful that the index will
include specific retention periods. We support the inclusion of all
Federal agencies in this legislation and believe it will allow thorough,
comprehensive overview of the important administrative functions of
paperwork management.
We are grateful for the expression of legislative intent to develop
additional legislation as problems are specified and solutions found.
In summary, the membership of ARMA offers its very strong support
to the Paperwork Reduction Act of 1980. We view the enactment of
H.R. 6410 as a major step to renewing public confidence in the regula-
tory process. Thank you, Mr. Chairman and members of the subcom-
mittee, for the opportunity to testify on behalf of the Association of
Records Managers and Administrators. We will be happy to answer
any questions you may have.
Mr. BROOKS. Thank you very much. How can the implementation
of H.R. 6410 aid in your task of establishing reasonable records reten-
tion periods?
Mrs. FULLER. Mr. Brooks, at the present time, there is no authori-
tative single source for retention regulations. Once you have deter-
mined which agencies have jurisdiction over your operations you must
then read the entire entries in the Code of Federal Regulations to see
whether or not they are specific. If retention information is added to
the Federal information locator system index, that can become an
authoritative register for the public and for the agencies and can be
used by the Administrator of the Federal Information Policy as a tool
to standardize retention periods.
Mr. BROOKS. Mr. Horton?
Mr. HORTON. Thank you, Mr. Chairman. I want to welcome Mrs.
Fuller and the representatives of the Association of Records Managers
and Administrators. It was about 2 years ago right after the work of
the Federal Paperwork Commission was concluded that I was invited
to attend your annual meeting in Houston, Tex. That was the first
meeting that I attended after making the report as Chairman of the
Paperwork Commission to the Senate, the House, and the President.
I remember the commitment that was made at that point by your
national chairman that your association would support the recom-
mendations of the Paperwork Commission, and what you've said
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here today is an implementation of that commitment. As the former
Chairman of the Paperwork Commission, I want to express my per-
sonal appreciation to you for following up on that commitment, and
again, tell you how much I enjoyed that visit with your national
organization.
Thank you very much.
Mrs. FULLER. Thank you, Mr. Horton.
[Mrs. Fuller's prepared statement follows:]
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ASSOCIATION OF RECORDS MANAGERS AND ADMINISTRATORS, INC.
4200 Somerset Drive -Suite 215
Prairie Village, Ks. 66208
Tel: [phone]
FRANCES E. FULLER
ASSOCIATION OF RECORDS MANAGERS
AND ADMINISTRATORS, INC.
H.R. 6410
THE PAPERWORK REDUCTION ACT OF 1980
BEFORE THE
SUBCOMMITTEE ON LEGISLATION AND NATIONAL SECURITY
COMMITTEE ON GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
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My name is Frances E. Fuller. I represent the Association
of Records Managers and Administrators, Inc. (ARMA) as Chairman of
the Legislative Affairs Committee.
ARMA is a non-profit professional association formed to
promote interest in records and information management. It provides
a forum for research, education,and the exchange of ideas. Our goals
are to foster professionalism, develop workable standards and practices,
and to furnish a source of guidance for the approximately seven-thousand
members we represent nationwide.
We are pleased to present testimony in support of H.R. 6410,
the Paperwork Reduction Act of 1980. We believe that this legislation
is representative of a national trend toward reappraising the role of
government and the effect of government regulations on the private
sector. Our Association lauds the work being done by this Committee
to address the serious problems we have encountered in attempting to
manage the paperwork and reporting requirements promulgated by
Federal Regulatory Agencies.
Our Association strongly supports the objectives of H.R. 6410.
We believe this Bill provides - for the first time - the basic authori-
ity and accountability to exercise badly needed control over reporting
and recordkeeping regulations which have become a $100 billion dollar-
a year burden to the private sector.
ARMA is in complete agreement with the statement of Congress-
man Horton, Chairman of the Federal Paperwork Commission, who said
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154
"Information is a resource, not a free good. Like all resources,
information is an asset to be managed, allocated efficiently, used
wisely, and disposed of when it no longer serves a useful purpose."
As records managers, our perspective on this legislation
is directed to private sector compliance. Although we are concerned
with areas such as the structure of the proposed Office of Federal
Information Policy, I will confine my remarks today to those topics
for which I have developed a measure of expertise.
As far as we are concerned, there has been, and continues
to be, a tremendous need for an Office of Federal Information Policy.
We are hopeful that the oversight responsibilities delegated to this
Office will eliminate many of the problem issues we would like to
address.
We feel that the authority delegated to the Office of the
Administration is both fair and necessary to assure an impartial,
objective assessment of the paperwork burden placed on the private
sector. We feel that the division of responsibility as enumerated
in H.R. 6410 is realistic and workable and will be instrumental in
developing a genuinely participatory information handling function
for the Agencies and the general public.
The Federal Paperwork Commission addressed the issue of
statutory recordkeeping and reporting requirements and found that,
not statutes, but agency rules and regulations comprised the bulk
of the paperwork burden. It is therefore our belief that greater
attention should be given to the rulemaking procedures. Each Agency
has developed many of its own internal procedures for formulating
and promulgating regulations. We would welcome the assistance of the
Administrator of the Office of Federal Information Policy as provided
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in H.R. 6410 to ensure the adequacy of public comment before
regulations are promulgated.
In our experience, there is very little an individual or
business has been able to do to effectively challenge the record-
keeping and retention requirements imposed by Regulatory Agencies.
We are confident that this legislation will clarify
Congressional intent to ensure the adequacy of public comment and
establish oversight and review procedures. Along these lines, we
would like to see the Administrator establish minimum standards
concerning the promulgation of regulations to include not only
earlier.public comment periods, but uniform procedures for admini-
strative review, and uniform rulemaking procedures to provide ad-
equate public participation and review by the Office of Federal
Information Policy.
Although the Paperwork Reduction Act of 1980 addresses the
issue of compliance costs, it does not mandate a cost/benefit
analysis regarding reporting and recordkeeping regulations. We do
not advocate cost accounting for each and every record-related
regulation, but we would like to stress our desire to include
compliance costs as a major factor in evaluating the necessity of
any further regulations by the Office of Federal Information Policy.
It is virtually impossible to determine the exact cost of
completing federal paperwork with any accuracy. Recent studies
addressing this issue, however, point out that while there has been
a reduction in the number of reports submitted by Federal Agencies
to OMB under the Federal Reports Act, the burden of reporting,
measured in man-hours has actually increased.
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Table 1 - Federal Report Forms Cleared by OMB1
Change Change
31 Oct. 75 1 Mar.76 Oct-Mar 30 June 76 Oct.'75
1976 June'76
Forms (Number) 5,827 5,655 -3% 5,002 -14%
Annual Responses
(Millions) 437 446 +2% 421 - 4%
Annual Manhours
(Millions) 138 145 +5% 143 + 4%
Source: OMB Inventory of Reports (Includes both repetitive and
single-time forms.)
Table one shows the number of reports required in the OMB
inventory and Table 2 contains the tasks involved and OMB estimate of
the manhours required by the private sector for compliance.
Table 2 - Federal Report Forms in the OMB Inventory
(June 30, 1977)
'Purpose or Forms Involved
Use
Annual Estimated
Hours Required to
Complete Forms
(000's)
Number Percentage Hours Percentage
Statistical Survey 1,262 27 18,033 13
Applications 1,193 25 52,748 38
Program Evaluation 1,090 23 28,793 21
.Other Management 658 15 13,749 10
Recordkeeping 249 5 12,561 9
Other 298 6 12,908 9
How do these man-hours estimates translate into dollars?
A recent article in Information and Records Management by Robert
Austin2 dealt with the cost of paperwork management. He found that
the man-hour costs involved in reporting compliance would range from
$6.50 to $12.00 per hour or $1,000 to $2,100 per business per month.
These rates multiplied by the man-hours estimates in Table 2 project
an annual private sector compliance cost of $814,000,000 to
$1,626,000,000. And, needless to say, the cost of this paperwork
1 Memorandum. Number OMB-161, Executive Office of the President, Office
of Management and Budget, Information Office, July 23, 1976. Subject:
Report on the President's program to reduce the burden of Federal Re-
porting (no official title).
2 "Information and Records Management ", Austin, Robert, Vol. 13, No. 2,
February, 1979.
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burden is passed on to the public in the form of higher consumer
prices. The Federal Paperwork Commission estimated that this maze
all boils down to a combined total of $500 annually for every person
in the United States.
I wish that were all, but it is not. No cost equation is
complete without the factor of retention and storage costs. Every
company in the U.S. has "on-site" and/or "off-site" space
used exclusively for the storage and retention of records. Reten-
tion has become a major factor in computing cost - as well as a
major problem for records managers. The cost of an off-site facility
to handle five thousand standard cartons of records was outlined in
Information and Records Managment. 3 The author found that the cost
for installation and one year's maintenance was in excess of $49,000.
Storage costs, which are incremental to recordkeeping compliance,
have increased dramatically over the years. It is not unusual to
find companies paying as much as $60,000 per year to store
records needed to comply with the recordkeeping, retention, and re-
porting requirements which affect their operation. Storage costs
are often a hidden factor not recognized when computing reporting
compliance figures.
Although the Administrator of the Office of Federal
Information Policy is directed to study and develop "standards
relating to record retention requirements imposed on the public,"
oversight to ensure the establishment of clear retention periods
simultaneously with the development of data collection or record-
keeping requests is not specifically addressed. -
3 "Information and Records Management", Payne, Marjorie Thomas,
Vol. 13, No. 3, March, 1979.
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A major problem presently encountered by the public is the
often vague or ambiguous nature of the regulations themselves.
If the Administrator of the Office of Federal Information'Policy
could accomplish only one thing, in our opinion, it would be to
simplify and clarify the recordkeeping and retention period regu-
lations. The average citizen should be able to understand federal
recordkeeping and retention regulations without specialized training.
We believe that if an Agency has the right to call for the
creation and maintenance of records and information, it likewise has
an obligation to provide meaningful retention periods to meet its
requirements.
Let me briefly describe the procedures a records manager
must use in order to determine a retention period once a record
series has been selected for consideration. First, it is necessary
to seek legal counsel for a determination of which Agencies have
jurisdiction over any of your organization's activities. Then, one
must determine which Agencies have jurisdiction over the particular
record. There is no authoritative reference source for that data.
At this point, it is necessary to read the complete entries in the
Cdde of Federal Regulations for all Agencies having jurisdiction in
order to determine whether or not those Agencies have issued.
regulations concerning the record for which you wish to set a reten-
tion period. References to recordkeeping and retention require-
ments are usually scattered throughout an Agency's regulations.
Very few Agencies have a comprehensive listing of these requirements
in one section of their regulations. There are essentially four
problems with the way record retention requirements are-published.
The first is that within the same Agency different Offices
or Commissions set different retention periods.
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For example, the U.S. Department of Labor requires retention of
applications for employment. However, two Of"'ices within the Labor
Department have different retention periods. The Equal Employment
Opportunity Commission sets a six month retention period
Vc, (29CFR ?1602.14) and the Wage and Hour Division Office requires
those same records be maintained for three years (29CFR 9850.3).
It is easy to see that confusion may result at the beginning of a
search for retention periods.
A second major problem is that many Agencies are vague as
to which records an organization must keep "in-house" subject to
audit even if they are specific as to the records that must be
filed with them.
Third, some Agencies fail to specify the records covered
by their retention regulations. ,For example, the Economic Regulatory
Administration (ERA) of the Department of Energy (1OCFR ?210) sets a
broad five or seven year retention period but is not clear as to
which records are covered by the regulation.
And fourth, we find that many are vague or unspecific as
to retention periods themselves. A perfunctory scan of the Code of
Federal Regulations will illustrate my point. Out of 1,364 direct
record retention requirements listed in the Code, 342 do not list a
specific retention period. In other words, one fourth of the readily
identifiable retention requirements do not include meaningful reten-
tion periods. Often the retention is vaguely stated as "indefinite"
or "not specified."
We have also found retention periods stated in such a
manner as to necessitate legal interpretation. For example,
regulations of the Public Welfare Department, Office of Family
Assistance (45 CFR ?205.60), state "The State agency will main-
tain.... records.... required by the Secretary; and will retain such
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records for such periods as are prescribed by the Secretary." Title
50, CFR, Wildlife and Fisheries (921.14) lists a retention period as,
"The buyer shall retain the Form 3-186 on file for the duration of
his possession of such birds or eggs or progeny or eggs thereof."
The latter example is somewhat amusing, but illustrates the kind
of problems records managers encounter in determining retention
periods.
It is inconceivable that we cannot assess a definite retention
period to Government required records.
Because retention periods are unspecified,. vague, and
difficult to determine, we are put in the position of having to keep
too many records for too long. Records managers, trying to balance
equipment, personnel, and storage costs of retention against
civil or criminal liabilities for premature destruction have a
difficult decision to make. The risks of premature records destruc-
tion are too great to offset the tremendous cost and personnel burden
they reflect.
After each Agency's regulations have been researched and
identified, we are still left with the problem of having to determine
the longest retention period required.
We are hopeful that the Federal Information Locator System
can be used to address this problem. Language in the Paperwork
Reduction Act of 1980 allows the general public to have access to
its indexing system on request. We are hopeful that the index
may be developed to include not only data profiles and reference
to the Agency which requires them, but also a reference to whether
or not the named data is a record to be filed with the Agency or
a record to be kept subject to audit. We are especially-hopeful
that the index will include specific retention periods.
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The Federal Information Locator System can be an invaluable
tool to the Office of Federal Information Policy, the Federal Agencies
and the general public.
We support the inclusion of all Federal Agencies in this
legislation and believe it will allow a thorough, comprehensive
overview of the important administrative function of paperwork
management.
On the subject of privacy protection, we feel that the
language contained in ?3510, Cooperation of Agencies in Making
Information Available, would better serve the interests of the
private sector if the consent of all affected parties, particularly
the supplier of the original document, was mandated before confi-
dential information could be released from one Agency to another.
We feel that the issue of releasing raw confidential information is._
important enough to require this prior consent even when the re-
ceiving Agency has authority to collect data. This small change
would allow the proper and necessary exchange of data among the
Agencies while retaining the concept of "fair play" to the affected
private sector parties.
We are grateful for the expression of legislative intent
to develop additional legislation as problems are specified and
solutions found.
In summary, the membership of ARMA offers its strong
support to H.R. 6410, the Paperwork Reduction Act of 1980:
We respectfully request that additional recognition be
given to costs incurred in records retention and to problems
encountered in determining retention periods. We are hopeful that
the Federal Information Locator System index will be made available
to the public as an authoritative register of all public-use reports,
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162
recordkeeping requirements, and retention periods on at least an
annuals basis.
As Congressman Horton said, "The permanent structure
established by this Bill would be able to pull out problems by the
roots, making sure that they wouldn't reappear." We view the
,
enactment of H.R. 6410 as a major step toward renewing public
confidence in the regulatory process.
Thank you, Mr. Chairman and Members of the Subcommittee,
for the opportunity to testify on behalf of the Association of
Records Managers and Administrators, Inc. I will be happy to
answer any questions you may have.
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163
Mr. BROOKS. Shall we proceed with Mr. Beck. Mr. Beck?
STATEMENT OF CARL A. BECK, PAST CHAIRMAN, BUSINESS
ADVISORY COUNCIL ON FEDERAL REPORTS
Mr. BECK. Thank you, Mr. Chairman. As you have suggested we
would like to submit our testimony for the record and I would like to
just emphasize two or three points.
Mr. BROOKS. We do not object to standard procedure.
Mr. BECK. Mr. Chairman and gentlemen of the committee. Today
we are addressing something that everybody seems to be for, like
motherhood, but I would like to call to your attention that it was not
ever thus. For many years we have recognized that paperwork man-
agement was the stepchild of OMB and we sincerely hope that
H.R. 6410 will preclude the possibility of this happening again. For
decades, this function in OMB has been understaffed, as we know,
and this is not to decry the excellent work that was done by many
members of OMB with their very limited resources. We, therefore, are
particularly encouraged by the establishment, as the bill provides, of
an Office of Federal Information Policy within OMB to take this
responsibility and pulling back the statistical aspects under one orga-
nization where it belongs. We of the Business Advisory Council on
Federal Reports, also agree that in looking at some of the things that
happened in the past the independence of the independent regulatory
agencies is something that should be thought about in terms of actions
in the future.
We agree with Mr. Staats that the independent regulatory agencies
should have the right to override OMB disapproval of certain record-
keeping and reporting requirements, but we would like to emphasize
that this action not be done in camera but be done in the sunshine;
in other words, that any overriding is performed in a public manner.
The other point that we think is extremely important is the emphasis
on upgrading the individual agency information management opera-
tions; we have long felt and long said that this is necessary. For too
many years agencies have shucked their responsibility over to OMB
and expected OMB to approve, or disapprove, things that they knew
were wrong and shouldn't happen in terms of excessive burden of
paperwork, but they haven't taken the responsibility themselves. In
the same voice, we are concerned that the bill may encourage complete
delegation of final authority from OMB to the agencies. We think it
is important that there be limited delegation of authority and en-
couragement of increasing the competency and resources of individual
agencies in the paperwork control area, but at the same time I think
we must recognize that OMB should never be in a position of dele-
gating final accountability. We have suggested some minor changes in
wording that you perhaps have noted to clarify this somewhat and
also in terms of a couple of items such as definitions and so on. What
we are saying is that we are certainly strongly in favor of the bill and
what we are suggesting are some revisions for clarification.
Mr. HORTON. Mr. Beck?
Mr. BECK. Yes, sir.
Mr. HORTON. First, I want to welcome you. You and the BACFR
were a big help to the Paperwork Commission. I remember, your con-
tributions there. The recommendations that you made with regard to
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changes in the legislation, are also helpful. We feel that we can cover
them by report language, and not have to make any changes in the
language itself.
Mr. BECK. There's one item that I think ought to be emphaized
also, either in the report language or in a minor modification of the
bill. That is the importance of public participation. If I may say so,
you yourself recognize the importance of this-certainly the Paper-
work Commission did. There should be more emphasis on the agency
responsibility for public participation. As you know we have been in
existence since 1942, and this has been our job: To make Government
paperwork more meaningful and more valuable to the Government as
well as less burdensome on the public. We have found that in virtually
every instance, over these many years and decades, that the result
has been not only a reduction of paperwork for both the Government
and private sector but also a more meaningful body of resultant data
in the collection agency. I think that we should be sure that this is
adequately recognized also, as OMB has been doing for the past several
months.
The presentation by agencies of regulatory information, proposed
regulations, and rules in the Federal Register, unaccompanied by at
least some indication of the potential for paperwork, recordkeeping,
and reporting, tends to belie what the rules and regulations might infer.
So, we would like to encourage that OMB in its implementation of this
act, if it's not in the act itself,.at least be encouraged to look at regul a-
tory pronouncements or exposure for comment and recordkeeping and
reporting as a package, an interrelated package, in order that the true
burden can be assessed. And, one last item,. Mr. Chairman, if I might.
Nowhere in this bill properly does it refer to this matter and yet it is
something that is frequently discussed. If I might quote Mr. Horton
correctly, he said once that "we have met the enemy and it is us." I
think that we need to recognize that there must be on the part of the
Congress, on the part of the House and the Senate, a real recognition
of their responsibility to put their input. into paperwork reduction.
There has been too much legislation that has been: No. 1, fuzzy and
No. 2, overly restrictive. This has forced the administrative part of the
Government to do things that just didn't make sense. There are now
rules for the House and for the Senate and we hope that the Senate and
and the House will, at least, be willing to pay attention to their own
rules so that they at least don't contribute unnecessarily to the burden
as they have so much in the past. -
Mr. BROOKS. We will take your admonition to heart. You've indi-
cated strong approval of the H. R. 6410 provision establishing the
Office of Federal Information Policy in the OMB. The OMB, on the
other hand, has testified that establishment by legislation of this Office
is somewhat unnecessary and perhaps inappropriate. Would you care
to comment on that?
Mr. BECK. I'd be very glad to, Mr. Chairman. We have read, of
course, the OMB testimony. We feel that for so many decades that
the paperwork function has been a stepchild of OMB, that in the long
run it will not receive the proper attention and dedication and even
financial support from appropriations that are required, unless it is
set up as such an office. To have it, as it has been in the past purely a
division-as it was the Statistical Policy Division-or as it is now,
doesn't give it enough significance when the world and certainly the
public is clamoring for a reduction of paperwork.
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Mr. BROOKS. Mr. Fascell. Any comments?
Mr. FASCELL. No.
Mr. BROOKS. Mr. St Germain?
Mr. ST GERMAIN. No.
Mr. BROOKS. Mr. Stangeland?
Mr. STANGELAND. No.
Mr. BROOKS. I would say that we might as well now take up H.R.
6410, the Paperwork Reduction Act of 1980. I'd like to thank, the
panel. We appreciate you all being here.
Mr. BECK. Thank you. We appreciate the opportunity to testify.
Mr. BROOKS. You had some excellent statements and they were
well worth presenting.
Mr. BECK. Thank you very much.
Mr. BROOKS. Did you introduce the two people with you, sir?
Mr. BECK. I am sorry. I guess I didn't do it. I apologize. Our counsel,
Thomas M. Brennan of Business Advisory Council for Federal Reports
and our executive director, David M. Marsh.
Mr. BROOKS. We're delighted to have you all here.
Mr. BECK. I brought them along to answer the tough questions, if
there were any. Thank you, sir.
[Mr. Beck's prepared statement follows:]
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STATEMENT OF
BUSINESS ADVISORY COUNCIL ON FEDERAL REPORTS
BEFORE THE
SUBCOMMITTEE ON LEGISLATION AND NATIONAL SECURITY
COMMITTEE ON GOVERNMENT OPERATIONS
?HOUSE OF REPRESENTATIVES
ON H.R. 6410, THE PAPERWORK REDUCTION ACT OF 1980
Mr. Chairman and Members of the Subcommittee:
My name is Carl A. Beck. I am President of the Charles Beck Machine Corp-
oration and am a past Chairman of the Business Advisory Council on Federal Reports.
I am accompanied by our Counsel, Thomas M. Brennan, and Executive Director,
David M. Marsh. We appreciate the opportunity to submit this statement on A.R.
6410, the "Paperwork Reduction Act bf'1980".
Historical Purpose of the Council - Paperwork Reduction
In 1942 Congress legislated the Federal Reports Act as a procedure for
independent, impartial review of federal information-collection programs. To
provide knowledgeable recommendations in the review process under the Act, busi-
nessmen promptly created the Business Advisory Council on Federal Reports (BACFR).
Financed entirely by business, BACFR works with the Office of Management
and Budget and the General Accounting Office on forms reviewed under their re-
spective jurisdictions. BACFR is also working directly with government officials
in the various Departments and Agencies. Advice and counsel to OMB, GAO, and
other government agencies on reporting forms and programs is performed primarily
by business representatives who may be respondents. They are selected carefully
- frequently in consultation with appropriate trade associations - on the basis
of their experience and knowledge of the reporting, recordkeeping and statistical
problems involved in the specific proposal. Such counsel may be provided by
written comment or by face-to-face discussion during a meeting or hearing.
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To help industry, government and taxpayers, BACFR has concentrated its
efforts on the three R's: reporting, recordkeeping and regulation. We are
pleased that our efforts have gained for the BACFR recognition by business and
government as an organization with a record of accomplishment in its work:
- to improve proposed reporting requirements with emphasis on reduced
reporting burden and reasonableness of the information program;
- to increase the meaningfulness and quality of government data-
collection programs;
- to simplify recordkeeping requirements made necessary by report-
ing and regulatory programs;
- to eliminate or consolidate data requests for information avail-
able from other sources, both public and private; and
- to monitor how government uses the information being collected.
Suggestions Regarding H.R. 6410
The Council has made 'Recommendations for Paperwork Management" which
contain principles for improvement of organization, management and control of
federal information activities. These recommendations have been favorably
received by a wide range of business, legislative and government leaders
knowledgeable in the area of federal reports.
We are particularly pleased to note that our recommendations and many
of the provisions of H.R. 6410 are consistent. -
The 'Attachment to BACFR Testimony" contains detailed suggestions regard-
ing the bill. In addition, we would like to comment on major provisions but I
should like to preface my testimony with a general observation growing out of
our more than three decades of a close working relationship with 0MB clearance
review procedures under the Federal Reports Act.
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168
In all these years, even after its function was expanded by the Adminis-
tration and the Congress to include "management", information management has been
a stepchild in the OMB. The importance of this operation has for too long not
been sufficiently recognized by top policy officials of OMB, and consequently,
it has not been given the support and backing it warrants. As a result, it has
never achieved the level of performance envisioned for it by the Federal Reports
Act. Yes, some steps have been taken by the OMB.toward that objective, but they
have been insufficent steps.
This is not intended, in any way, to deprecate the handful of men and
women who over the years have dedicated their full efforts to the best implemen-
tation of the Federal Reports Act possible under the imposed limitations of staff,
appropriation, and lack of total top level support. Also we do not, in any way,
want to convey the impression,. that the review function should be in some agency
other than OMB. We, in business, if our sales operation is not being efficiently
performed by our sales department do not transfer the operation to, say, or
production department. We take whatever steps are necessary to beef up the
department so that it performs our selling operation efficiently and effectively.
By the very same reasoning, we agree heartily with the provisions of the
bill establishing an Office of Federal Information Policy within the OMB and
specifying clearly its jurisdiction and responsibilities. Because of our firm
agreement, we offer for your consideration certain suggestions, which as a result
of our long experience, we believe will strengthen the implementing provisions
of H.R. 6410.
1. H.R. 6410 is "A Bill to reduce paperwork..." I call.your special
attention to the inclusion of the words the "private sector" in this statement
of purpose. Yet, may I point out that the bill itself incorporates minimal
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utilization of a resource from the private sector highly competent to assist in
attaining the stated objective. I refer, of course, to consultation with what
is referred to in the bill as "interested persons" or "the public". In the
countless consultations BACFR has, provided to agencies over the years, we have in
each case brought together persons from the business community widely knowledge-
able in the subject matter of the information collection proposal. Furthermore,
for a broader base of know-how, we have involved officers of state governments,
educators and other specialized personnel. In virtually every instance the
result has been not only a reduction of paperwork for both the government and
the private sector but a more meaningful body of resultant data in the collec-
tion agency.
I have said that utilization of this resource in the bill is minimal. I
must add that not only is it minimal, but every provision for such consultation
is restricted. Specifically.:
- In subsection 3504, public comment is ensured only in the development of
rules and regulations and further restricted only to the "proposed means
of collecting information".
- Under section 3508, comment by "interested persons" is restricted to the
necessity of the information for proper performance of the functions of
the agency and whether it has "practical utility" for the agency, both
fundamentally internal government matters.
- Section 3517 appears to allow consultation with the private sector only
in the case of "information policies, rules, regulations, procedures
and forms" being developed by the Director in the exercise of his
authority as it relates to information gathering by the various agencies.
We earnestly urge that the Director and/or the sponsoring agency should be
required to (a) publish in the FEDERAL REGISTER information collection proposals
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currently under review and in the case of the agencies, at a reasonably early
stage of their development; (b) allow sufficient time for public comment; and
(c) provide a bearing at the request of and on concern broadly expressed by
potential respondents. Detailed suggestions are set forth in the Attachment to
our testimony.
2. We are enthusiastic about provisions to improve and upgrade individ-
ual agency information management operations. In this connection, there are
constructive suggestions in the recent reports of the General Accounting Office,
"Protecting the Public from Unnecessary Federal Paperwork: Does the Control
Process Work?", and the Office of Management and Budget, "Paperwork and Red
Tape: - New Perspectives -New Directions". Further emphasis on agency manage-
ment and planning is a part of Executive Order 12174 and the proposed revision
of regulations in OMB Circular A-40. Such improvements were also advocated by
the Commission on Federal Paperwork. They are implicit in Section 3506. If
agencies do a thorough and effective job of internal evaluation of their in-
formation proposals, including adequate consultation with potential respondents,
the workload of OMB should be considerably lessened.
3. Subsection 3505(2)(E) requires the Director to send the President and
the Congress legislative proposals regarding privacy and confidentiality.
Developing such proposals will be a tremendous task. Furthermore, privacy,
confidentiality and disclosure of information are extremely complex and sensi-
tive areas. Such laws, regulations and procedures are of vital interest to
BACFR and must be developed in close consultation with the business community
and other interested members of the public.
A related bill has been drafted by the OMB Federal Statistical. System
Project and is entitled "Confidentiality of Federal Statistical Records Act".
In our opinion, it deserves favorable consideration.
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4. We believe it is inconsistent to provide for central reports manage-
ment and clearance and then allow blanket and complete delegation to agencies
of the Director's power to approve proposed information collection requests
(Sec.3507(e)]. Such a blanket delegation would, we believe, fragment information
control and not be in the public interest. Furthermore, there is a practical and
human tendency for an agency official to respect the information wishes of other
officials within his agency. Whatever information an agency requests, we all
know is considered by that agency to be vital to its function.
It is also difficult to see how the agency can well consider the interests
and concerns of all other federal agencies to the same extent as the OMB. Only
OMB can accomplish the impartial review we consider essential.
We do not favor a blanket delegation but endorse a procedure similar to
that stated in Executive Order 12174, "Paperwork", and OMB proposed.5CFR 1320,
"Controlling Paperwork Burdens on the Public". While we will offer suggestions
on this OMB proposal, the provisions which we believe are essential to a meaning-
ful paperwork control program are:
- Having an agency demonstrate that it has a sufficient number of
qualified personnel at a high organizational level before any
"modified review" agreement covering certain information collection
requests is entered into between any agency and OMB. Such a modified
review agreement should authorize the agency to conduct a primary
review of only those information collection requests that are non-
controversial and have a minimal impact on the public. Public con-
sultation and opportunity for public hearing are critical elements
of any proposal by OMB to enter into a modified review agreement with
an agency. (See proposed 5CFR 1320.29.)
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A requirement that each agency submit twice a year to OMB a compre-
hensive Information Collection Budget (ICB) covering all contemplated
information collection requests from the public in the next 12 months.
- Publication in the FEDERAL REGISTER by OMB of a calendar of all in-
formation collection requests that are of significance and are antic-
ipated during the next 12 months. One of the purposes of publication
of the calendar is to invite public comment on proposed reporting
programs.
- Detailed submission by agencies to OMB for clearance review of sig-
nificant proposed information collection requests with FEDERAL
REGISTER notice of each such submission and ample time for public
comment.
In order that they have the stature of legislative backing, we suggest
that the procedures identified above be inserted in H.R. 6410 in lieu of Sub-
section 3507(e). We favor a strong oversight role by this Committee and the
General Accounting Office.
Public participation in the development of information programs has been
thwarted by lack of adequate time for comment. Without the views of affected
respondents, information collected is overly burdensome and less meaningful.
In any event, we vigorously urge that.final accountability for reports review
rest with OMB.
5. To carry out the philosophy that one hundred percent of federal re-
porting requirements - not just twenty-five percent - should be subject to
central review, we support the revision of the definition of "Federal agency"
to include all agencies. In the absence of such a provision, the chance of
collection of duplicative and unduly burdensome - not to mention meaningless -
data is infinitely greater. One must in candor recognize the nature of
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independent regulatory agencies. Therefore, we believe they should be permitted
to override OMB disapproval, provided that action is not done in camera but is
performed in a "public" manner, such as through hearings or action of the
agencies' Commissioners or Board, with reasons published in the FEDERAL REGISTER
[See Sec.3507(b)]. We also realize there are a few instances where expedited
clearance may be appropriate.
6. In the interest of avoiding unnecessary duplication, the Council views
as constructive the establishment in OMB of an information locator system. We
understand the recent test by six agencies produced mixed results. A report
dated December 31, 1979; has just been issued by the Federal Information Locator
System Task Force. The report contemplates further consideration of the proposed
system by agency officials and, we are pleased to note, interested members of the
public. We believe it essential that the system be cost effective.
7. Based on our strong feeling that all information management authority
should be located in OMB, we favor return to that office of the Office of Federal
Statistical Policy and Standards (Sec.3(a).
To recapitulate, we favor:
- Recombining the reports clearance and information management function
at a much higher level and with adequate personnel in the Office of
Management and Budget.
- Continuing development of an information locator system.
- Including all agencies in the form review process with a "public"
veto procedure for regulatory agencies.
- Maximum opportunity for public participation in the form develop-
ment and review process, both at the agency level and at OMB.
- Final accountability for approval'in OMB of information collection
requests.
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174
The Board of Governors and members of the Council wish to express
appreciation for the interest in this subject shown by you and your colleagues
who co-sponsored this beneficial legislation.
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ATTACHMENT TO
BUSINESS ADVISORY COUNCIL ON FEDERAL REPORTS
TESTIMONY ON H.R.6410
FEBRUARY 26, 1980
Sec.3502
We believe that consideration should be given to including definitions
of two key terms used in the bill, namely, "burden" and "practical utility".
To assist in developing these definitions, reference may be made to proposed
subsections 1320.4(1) and (k) of the OMB proposed rule published in the FEDERAL
REGISTER January 11, 1980.
Sec.3502(2)
We recommend that "collection of information" include oral requests such as
those by telephone or in person. Otherwise, these means of collection - which
may be just as onerous as written requests - might be used to avoid clearance.
A similar comment applies to Sec.3502(9), "information collection request".
Sec.3502(2) and (9)
Inclusion of recordkeeping requirements is a much needed addition to infor-
mation management.
Sec.3502(10)
"Officials and citizens" raises a question of access that may not be intended.
It is assumed that there will be both governmental and non-governmental access,
and that citizenship will not be a factor. Reference in Sec.3511(b)(3)(B) is to
"members of the general public", and either this expression or "person" (as defined
in Sec.3502(11)1 would seem more appropriate.
Sec. 3504 a
We suggest revision (underlined below) to read: "The Director ... including
review and approval, modification or disapproval of information collection requests,
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
the measurement and reduction ...". We assume that the expression "other tech-
nology for managing information resources" refers to telecommunications and the
Federal Information Locator System..
Sec.3504(b)(1)
It would seem desirable to make clear that "information resources management"
encompasses personnel and equipment that are necessary to control paperwork and
achieve greater efficiency in government.
Sec.3504(c)
We suggest adding to the Director's functions "consultation with public organ-
izations and establishments in reducing the burden of reporting and recordkeeping
on the public".
Sec.3504(c)(1)
We recommend adding the following words which are underlined: "... and approv-
ing, modifying or disapproving information...".
Sec.3504(h)(2)
Comment might well include any opinions on the validity, authority, burden,
duplication and compatability with existing reporting and recordkeeping, and we
therefore suggest that "information collection requests" be substituted for "means
of collecting information".
Sec.3505(l)(A)
"Major information systems" is not defined. We recommend that you consider
the definitions used by the General Accounting Office in its Source Book publica-
tion, "Information Sources and Systems".
Sec.3505(D)
"Major information holdings" is not defined. It is not clear what might be
included in this responsibility beyond what is contemplated under Section 3511.
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177
Sec.3505(2)(A)
What are the "various information handling disciplines"? Are they the informa-
tion disciplines specified in this act? Are micrographics and the use of word
processing and other office machines included, for example?
Sec.3505(2)(C)
It would appear that "information processing standards" is meant to refer to
automatic data processing; if others, we think they should be specified.
Sec.3505(2)(C)(ii)
We suggest that the meaning of "standards development program" be spelled out
in the bill.
We recommend atlding the following, underlined: "In consultation with the
General Accounting Office, agencies, the Congress and the public, complete action...
What is called for in this subsection represents a mammoth undertaking. As
confidentiality and privacy laws, regulations and practices are of vital interest
to BACFR, any proposals in these areas should be developed in close consultation
with the business community and other affected members of the public. Hence, we
strongly recommend a public consultation provision be included in (E).
We believe it desirable to include in the report on the bill that the Congress
expects that the "senior official" be provided capable personnel and other resources
necessary to carry out federal agency responsibilities assigned under H.R.6410.
Sec.3506(c)
Suggest adding a new paragraph (5) to read:
"(5) Provide an early and substantial opportunity for the public to comment
on each proposed information collection request."
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001
0-5
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This suggestion is consistent with the provision for public consultation by the
Director of 0MB contained in Sec.3517.
Sec.3506(c)(3)
Suggest modification to read (addition underlined): "... procedures which
are consistent with OMB direction under Sec.3504...".
Sec.3507(e)
Based on our apprehension over blanket delegation of clearance authority to
any agency, we advocate deletion of this subsection and substitution of the pro-
cedures suggested in the main part of our testimony. If this subsection is to be
retained, however, we suggest adding "and the capability" after "sufficient re-
sources", and delegation should be prohibited where the burden is more than say
one hour per respondent. The discretionary authority of the Director to review is
absolute. Therefore, we think it essential that the sentence at lines 4 - 6 be
amended to read as fellows:
"Such delegation shall not preclude the Director, on his own initiative
or on request of interested persons, from reviewing and approving, modifying
or disapproving individual information collection requests."
Sec.3508
We suggest inserting after the word "approving", "modifying or disapproving".
Rather than make it optional that the Administrator "may determine" and "may give",
it would be preferable that the Administrator "shall determine" and "shall give".
The provision for giving "interested persons an opportunity to be heard" is a very
important one. We would hope that it would be liberally applied. We suggest that
a minimum of 45 days be allowed, after FEDERAL REGISTER notice, for submission of
comments. We also suggest adding after "... for any reason, the ...", the following:
"Director shall deny the collection and the ... .
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Sec. 3510
A general discussion relating to this section is contained in our testimony.
Sec.3510(b)(1)
We suggest deleting the semi-colon and adding in such a manner as to preclude
the identification of any person;"
Sec.3513
It would seem desirable to limit the advice and assistance of GSA to the
areas in which it has authority and not include all information management activ-
ities. Of course, nothing in this section will preclude the General Accounting
Office from conducting what we have found to be most useful paperwork management
audits.
Sec.3514
The Annual Report will be useful and provide the public with a concise
record of performance and insight into future proposals.
Sec.3514(a)(4)
It is recommended that the summary include the number of information collec-
tion requests approved, modified or disapproved by agency, by category of respondent.
Sec.3517
We recommend deleting the word "forms" on line 6 and inserting in lieu thereof
the words "information collection requests". After the word "Director" we suggest
adding the words and each agency".
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
[Whereupon, at 10:44 a.m., the subcommittee adjourned, to recon-
vene subject to the call of the Chair.]
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
APPENDIXES
APPENDIX A.-EXECUTIVE OFFICE OF
THE PRESIDENT
Federd Rem
Vol. H. No. 234
Tuesday. December 4, 1979
The President
Presidential Documents
Executive Order 12174 of November 30, 1979
Paperwork -
By the authority vested in me as President by the Constitution and statutes of
the United States of America, and in order to establish procedures that
eliminate all paperwork burdens on the public above the minimum necessary
to determine and implement public policy and ensure compliance with Federal
laws, it is hereby ordered as follows:
1-101. Agencies shall minimize the paperwork burden-i.e;, the time and costs
entailed in complying with requests for information and recordkeeping re-
quirements-imposed on persons outside the Federal government. Forms
should be used only to the extent necessary to gather the basic information
required to fulfill an agency's mission. When forms must be used. they should
be as short as possible and should elicit information in a simple, straightfor-
ward fashion.
1-102. Each agency shall designate an existing official to be responsible for
minimizing both the agency's use of forms and the paperwork burden resulting
from proposed legislation and regulations.
1-103. Agencies shall pay particular attention to the special burdens faced by
individuals and small organizations in responding to requests for information.
To minimize these burdens agencies should. whenever possible, forego uni-
form or universal reporting requirements and rely instead on sampling, re-
duced frequency of reporting, differing compliance standards, or exemptions.
1-104. Each agency shall prepare an annual paperwork budget i.e., an esti-
mate of the total number of hours required to comply with requests for
information. The budget should itemize each form used. describe its purpose
and identify those affected by it The Director of the Office of Management
and Budget shall review and may modify each agency's proposed budget
After the Director has approved an agency's paperwork budget, it may be
increased only by the Director upon request of the head of the agency.
1-105. Forms or similar requests for information shall be reviewed within two
years,after their initial issuance and then at least once every five years.
'Following review, they should be revised or abandoned to the extent they are
not required to meet an agency's basic information needs. These reviews will
be conducted by the agencies, and reports of the reviews will be submitted to
the Director.
1-106. The Director shall audit compliance with this Order and may issue rules
and regulations necessary to implement it The Director may issue exemptions
for. agencies whose use of forms is limited. The Director also shalk
(a) Seek to eliminate duplication In requests for information by establishing a
Federal information locator system, which will list all the types of information
collected by Federal agencies and will be available for use by all agencies.
This or similar systems will not contain any information obtained from the
puulia'The Director shall take any other steps needed to prevent duplication,
including the assignment to a particular agency of lead responsibility for the
collection of certain types of information. -
(b) Seek to inform the public and broaden public and agency comment by
preparing-and publishing in the Federal Register an annual paperwork calen-
dar of significant requests for information. This calendar will be based on the
information contained in the agencies' paperwork budgets.
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FR Doc 70-37955
Plied 11-05-* 5 pm)
? man* sod. 9105-01-M
1-107. The authority vested in the Director under this Order shall not affect
any authority vested in him by any other Order. This Order shall be imple-
Executive Order 12044.
1-109. This Order will expire on September 30, 1983.
Rar oaA1 Non: The President's remade of Nov. 30. 1970. on 0igaing Executive Order 12174. are
- printed in the Weekly Compilation of Presidential Dom?mta (vol. Ifs no. 46)
 Approved For Release 2007/05/17: CIA-RDP85-00003ROO0300050010-5
The President's Paperwork Message summarizes paperwork
reduction progress since 1977, and announces new measures
to reduce paperwork and red tape.
I. Actions Taken So Far
1) Total time spent by the public filling out Federal
forms was reduced from 913 million hours per year
in January 1977 to 786 million hours per year in
1979. Paperwork in the agencies subject to the
President's Paperwork Reduction Program was cut
by 15 percent.
2) Of the 520 recommendations of the Commission on
Federal Paperwork, 269 have been implemented, 171
are under active consideration, and 80 have been
rejected. The Commission issued its final report
in October 1977. OMB expects action on all
recommendations to be completed by March 1980.
OMB has established a new division to oversee the
Federal Government's efforts in paperwork reduction
and regulatory reform.
II. Initiatives Announced Today
A. Executive Order on Paperwork
The President has signed an Executive Order covering
paperwork imposed on the public by all departments
and agencies except the independent regulatory
agencies. The Order has six major elements:
1) Paperwork Budget
OMB will administer a budget to control the total
burden that agencies may impose on the public.
Each agency will submit an annual plan for future
requirements for. information from the public,
including an estimate of the number of hours
required to fill out all its forms. OMB may agree
with the plan or order the total reduced. This
budget will ensure that agencies fully consider the
paperwork burden on the public before imposing new
reporting requirements.
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184
2) Information Locator System
The Executive Order initiates a government-wide
Federal Information Locator System. This System
will contain profiles of all Federal agencies'
requests for information. Before issuing a new
form, each agency will be required to check and
see if another agency is already gathering the
data. The system will not include the information
actually provided by respondents; only the questions
asked.
3) Special Consideration for Small Organizations
Agencies are required to seek ways to reduce the
paperwork burden on those least able to bear
it--such as individuals, small units of government,
and small businesses. For example, agencies will
be required to consider shorter or less frequent
reports or exemptions for small organizations.
To weed out needless reports, new reporting require-
ments will only be authorized for two years. Exist-
ing reporting requirements will terminate after five
years. A new approval by OMB will be required if
reports are required beyond the "sunset" date.
5) Public Participation
The Executive Order mandates that paperwork require-
ments must be developed in consultation with those
who will be affected. Public notice and hearings
will be required.-on all significant reports.
Agencies will seek comments on individual reports
that impose significant burdens.
B. Paperwork Reduction Legislation
The President called for legislation to strengthen
controls over Federal paperwork and endorsed the
efforts of senator Lawton Chiles and Congressmen
Jack Brooks and Frank Horton to accomplish these
goals:
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Under the Federal Reports Act, OMB approves or
rejects proposed forms from many agencies, but
wide loopholes in this authority mean that OMB
oversees only 19 percent of total Federal
paperwork. Clearance authority for the indepen-
dent regulatory commissions and the Office of
Surface Mining should be transferred from GAO to
OMB. Loopholes involving tax, banking, education,
and health manpower forms should be closed to
provide central oversight in OMB for all Federal
information requirements.
2) Information Locator System
This System should be made permanent through
statute.
3) Enforcement of Clearance Procedures
The public should be allowed to disregard a
form, if OMB does not apnrove-.it.Adverse action
against members of the public who refuse to fill
out such unapproved forms should be prohibited.
4) Review of Agency Programs
OMB should be mandated by law to review, at least
once every three years, each agency's information
management and paperwork reduction activities. OMB
should be authorized and required to set target
goals for reduction of the number of information
collection requests and the burden they impose on
the public.
Designation of Central Collection Agency
OMB should be authorized to designate one agency
to collect information for several agencies,
thereby eliminating duplicative reports.
The Government's use of information should be
improved by requiring strengthened management of
upgraded information technology, to ensure better
use of the data generated by federal information
requirements levied on the public and to reduce
overlap, duplication and waste.
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7) Confidentiality and Sharing of Statistical Data
OMB has just completed a study of the Federal
Statistical System. Two recommendations of the
study should be included in the legislation:
a) Confidentiality
Persons who provide data for statistical purposes
to Federal agencies should be assured, by
statute, of the confidentiality of their
responses. Such confidentiality statutes now
apply only to the Bureau of the Census and
the National Center for Health Statistics.
Currently, the confidentiality of the statistical
data compiled by other agencies is protected
by government regulation. Statutory criminal
penalties for government employees who disclose
individually identifiable information would
strengthen the assurance of confidentiality
and encourage voluntary cooperation with
statistical data collection efforts.
b) Sharing
A strong statutory basis for the promise of
confidentiality would permit the limited sharing
of records between statistical agencies.
Legislation should authorize such sharing,
which will reduce duplicative data collection
and make more effective use of statistical
data, upon the demonstration of major need and
sufficient protection for the records.
C. Congressional Reports Elimination Act of 1979
The Administration is proposing legislation that
will eliminate 140 reports currently required by
law to be submitted to Congress and will consoli-
date or simplify an additional 84 reports. These
reports are considered no longer necessary,
duplicative of other information provided to
Congress, or otherwise in need of change. In
addition to these reports, Federal agencies are
taking administrative action to eliminate
another 53 reports to Congress that are not
formally required by law. These eliminations
and changes in reports to Congress will save at
least $5.5 million annually.
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187
D. Selected Paperwork Reduction Actions
The President announced a significant reduction
in paperwork on the public and state governments
resulting from the consolidation of three
reports relating to the welfare, medicaid and
food stamp programs. Previously, each program
had its own quality control efforts which
resulted in duplication and unnecessary report-
ing burdens on state welfare agencies and the
poor. Fifteen states have now adopted a
uniform quality control methodology and
combined reporting forms, steps that have
resulted in a saving this year of 150,000
hours. When the program is adopted in all
states, annual saving of a half million hours
and $10 million will result.
Other recent examples of Administration actions
to reduce paperwork include:
1) The burden of the National Institutes of
Health research grant application was
reduced in August by eliminating certain
requirements and limiting the amount of
information required on research plans,
resulting in a reduction in reporting of
140,000 hours.
2) Application and other reporting requirements
levied on Community Mental Health Centers
were reduced 86 percent by reducing the
frequency of reporting and the amount of
information required. This is a reduction
of nearly 60,000 hours annually for the
approximately 500 grantees participating in
the program.
3) ACTION accomplished a 52 percent reduction
(235,000 hours) in its reporting burden on
the public over the last nine months. This
was achieved by bringing its grant reporting
requirements into compliance with OMB
directives on grant applications for state and
local governments and by reducing the number of
references necessary for an applicant to
become an ACTION volunteer.
4) The Internal Revenue Service will revise
the Employer's Annual Federal Unemployment
Tax Return form for 1979. The revised form
will reduce by 50 percent the number of items
and data elements that many firms must complete.
The use of the simpler form, which must be
filed by more than 4 million employers, will
reduce this particular reporting burden by
2-1/2 million hours annually.
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f/4-1 /e-u/ :
F/./4L Dcir
In the last two and one-half years, we have made real progress in
slashing the paperwork burden that government imposes on the public.
I am announcing today a new program to expand and accelerate this
progress.
I have signed an Executive Order on paperwork reduction, and
I am calling on Congress to enact two pieces of legislation. To-
gether, these measures will help us eliminate needless forms, cut
duplication, streamline the forms we need, and strengthen central
oversight of all Federal paperwork.
Government efficiency is a central theme of my Administration.
We must eliminate needless burdens on the public and spend, its hard-
earned tax money with great care if we are to restore confidence
in government as an instrument to serve public needs. We have
made substantial progress in this area, through regulatory reform,
civil service reform, reorganization, and other initiatives.
Paperwork reduction is an important part of this program.
Some Federal paperwork is needed. The government must collect
information to enforce the civil rights laws, compile economic
statistics, design sound regulations, and for many other purposes.
In recent years, however, government forms, surveys and interviews
have mushroomed. Much of this paperwork is unnecessary or duplicates
information being collected elsewhere. Time spent filling out
unnecessary forms is time lost for productive activities, so we owe
it to the public to carefully control paperwork requirements.
My Administration has stopped the paperwork surge and started
cutting this burden down to size. We have reduced the amount of time
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189
Americans spend filling out Federal forms by almost 15% -- 172 million
hours or the equivalent of 75,000 people working full-time for a year.
We have evaluated the 520 recommendations of the Paperwork Commission
and have already implemented more than half of them. Examples of
actions we have taken include: IRS made it possible for five million
taxpayers to switch from the long tax form to the short one; OSHA
exempted 40,000 small businesses from reporting requirements; the ICC
sliced a 70-page report required from 13,000 carriers down to 8 pages;
and Labor and Treasury slashed the paperwork burden that was crushing
pension plans.
I am announcing another of these cuts today. State officials
currently survey beneficiaries of various welfare programs with
three overlapping reports, totally 33 pages. We are merging them
into a single, 15-page report -- saving the states a total of
500,000 hours and $10 million per year.
The progress has been substantial, but we must do more. Most
paperwork requirements stem from statutes, and new legislation is
creating new requirements in energy, environmental protection, and
other programs. To continue our success, we need the broad management
program I am announcing today.
The Executive Order I have signed establishes strong management
tools for the Executive agencies. It creates a "paperwork budget."
Each agency will submit an annual estimate of the numbers of hours
required to fill out all its forms, and OMB will hold agencies to
that total or order it cut. This process will work like the spending
budget to give agencies incentives to set priorities and to eliminate
or streamline burdensome forms.
The order creates a Federal Information Locator System, which
will list all the types of information collected by Federal agencies.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Before an agency collects information, it will check in this System
to see if another agency already has the data :
The Order also requires agencies to consider the special prob-
lems of small organizations. Data gathering that may be easy for a
corporation with computerized records may be very costly for a
small businessman who keeps records by hand and must work weekends
to complete the forms. Although some reports must be universal
and uniform, many agencies can meet their information needs while
providing exemptions or less burdensome reports for small businesses.
Some agencies already have started doing so; the Executive Order
requires all agencies to consider this approach for each form.
Senator John Culver deserves credit for leading in the development
of this concept.
Finally, the Order mandates a "sunset" process. No Federal
program should continue indefinitely without review. I am supporting
legislation to provide sunset reviews for spending programs, and my
regulatory reform bill requires agencies to overhaul existing
regulations. The paperwork Executive order requires that each
form terminate every five years unless a new, conscious decision is
made to continue it.
We also need legislation to build a complete paperwork control
program and extend it to all agencies. Representatives Jack Brooks
and Frank Horton and Senator Lawton Chiles have taken the lead in
developing a Paperwork Reduction Act which will strengthen and
unify paperwork oversight. The existing Federal Reports Act gives
OMB the power to disapprove many agencies' forms, but the
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independent regulatory commissions are reviewed by the General
Accounting Office, and tax, education, and health manpower programs
have no central review at all. These loopholes represent 81% of
the total paperwork burden. (Tax forms are 73%.) The legislation
will close these loopholes, providing central oversight for all
forms. To strengthen the clearance process, the bill will allow
members of the public to refuse to fill out forms that have not been
properly cleared.
The legislation being developed will also provide strong tools
to cut duplication. When several agencies want to collect over-
lapping data, the bill will empower OMB to assign one agency to do
the job. It will also deal with the special problems of statistical
systems. One cause of duplication is that agencies collect
statistical data under pledges of confidentiality which hamper
sharing. The bill will authorize sharing while strengthening safe-
guards to ensure the data is used only for statistical purposes and
never to abuse personal privacy. These provisions will also help us
strengthen our Federal statistical systems, which are crucial to
economic policymaking.
While controlling the paperwork imposed on the public, we. must
also hold down the paperwork in the Government itself. am,
therefore, submitting to Congress the Reports Elimination Act of
1979. This bill, together with administrative action we are taking
now,-will eliminate or simplify 278 annual reports written by
agencies, saving at least $5.5 million per year.
This overall program has been developed in a cooperative effort
with the leaders of the Senate Governmental Affairs and House
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Government Operations Committees. Working together, we will continue
the progress on cutting away red tape. I urge the Congress to act
promptly on the two bills I have discussed. -
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EMBARGOED FOR RELEASE
AT 10:45 AM EST NOVEMBER 30, 1979
In the past two and one half years, my Administration
has achieved real progress in cutting the paperwork burden
government imposes on the public. Today I am announcing steps
to expand and accelerate that effort.
I have today signed an Executive Order on paperwork
reduction. I am also calling on the Congress to enact two
bills which will help eliminate needless forms, cut duplication,
streamline those forms which are necessary and strengthen
central oversight of Federal paperwork.
Government efficiency is a central theme of my Administration.
If we are to restore confidence in government, we must eliminate
needless burdens on the public. We have pursued this goal
through regulatory reform, civil service reform, reorganization,
and other initiatives. Paperwork reduction is an important
part of this program.
Some Federal paperwork is. needed. The government must
collect information to enforce the civil rights laws, compile
economic statistics, design sound regulations, and for many
other purposes. In recent years, however, government forms,
surveys and interviews have mushroomed. Much of this paperwork
is unnecessary or duplicates information being collected
elsewhere.
My Administration has stopped the paperwork surge and
started cutting this burden down to size. We have reduced
the amount"of time Americans spend filling out Federal forms
by almost 15% -- 127 million hours. That is the equivalent
of 75.000 people working full-time for a year. We have
evaluated the 520 recommendations of the Paperwork Commission
and have already implemented more than half of them.
The Internal Revenue Service made it possible, for example,
for five million taxpayers to switch from the long tax form
r to the short one. The Occupational Safety and Health Adminis-
tration exempted 40,000 small businesses from reporting requirements.
Tae Interstate Commerce Commission sliced a 70-page report
required from 13,000 carriers down to 8 pages.- The Labor
and Treasury Departments slashed the paperwork burden that was
r crushing the small pension plans. I am today announcing that
we are consolidating three reports required from the States
on welfare and food stamp programs; this will eventually save
500,000 hours and $10 million per year.
The progress in cutting Federal paperwork has been substantial,
but we must do more. Congress is enacting new requirements in
energy, environmental protection, and other programs that will
add to the paperwork burden. To continue our success in eliminating
Federal paperwork, we need the broad management program I am
announcing today.
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The Executive Order I have signed establishes strong
management tools or the Executive agencies. First of all,
it creates as'p?o'rk'get.,.b Each agency will submit an
annual estimate of the numbers of hours required to fill out
all its forms. The Office of Management and Budget will then
hold agencies to that total or order it cut. The process
will be similar to the spending budget; it will give agencies
incentives to set priorities and to eliminate or streamline
burdensome forms.
The Order creates a Federal Information Locator System,
which will list all the types of information collected by
Federal agencies. Before an agency collects information,
it will check in this System to see if another agency already
has the data.
The Order also requires agencies to consider the special
paperwork problems of small organizations and small businesses.
Data gathering that may be easy for a corporation with computerized
records may be very costly for a small business person who
keeps records by hand. Some reports must necessarily be uni-
versal and uniform, but in many cases agencies can meet their
information needs while providing exemptions or less burdensome
reports for small businesses. Some agencies already have
started doing so. TPre^'Executive Order requires all agencies
to review each Poem to identify those cases where small__org?ni-
zations can be exempted or'given simpler forms. Senator
John Culver deserves credit for leading the development of
this concept of special consideration for small organizations.
Finally, t A_ Mi datC9 9=ra"~,~ "~nnn~oa This
process will be similar to the legislation I am supporting
to mandate sunset reviews for regulatio ,.;apending programs
fgrm.__.terminate every five years unless a new
deed=slsa-3s
to continue i_~.
We also need
onatZnT = pregram . and xtxe =11.-Ea a1_1_ age no
Jack Brooks, Frank Horton, and Tom Steed and Senator Lawton Chiles
have taken the lead in developing a Paperwork Reduction Act
which will strengthen and unify existing paperwork oversight.
The Federal Reports Act is insufficient in this regard. It
gives OMB power to disapprove many agencies' forms, but the
independent regulatory commissions are reviewed by the General
Accounting Office and tax, education, and health manpower
programs have no central review at all. These loopholes represent
This legislation will close these loopholes, providing
ntral oversight for all forms. It also strengthens the
perwork clearance process by allowing members of the public
refuse to fill out forms that have not been properly cleared.
d plication in paperwork requirements. When several agencies
w'nt to collect overlapping data, the bill will empower the OMB
t assign one agency to do the job. The bill will also deal
w th the special problems of statistical systems. One cause
o duplication is that agencies collect statistical data under
p edges of confidentiality, and these pledges hamper sharing
the data. The bill will authorize such sharing while strengthening
safeguards to ensure the data is used only for statistical
purposes and never to abuse personal privacy. These provisions
will also strengthen our Federal statistical systems, which
are crucial to economic and other policymaking.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
W,Jyile controlling the paperwork imposed on the public,
we must also hold down paperwork within the Government itself.
Iam therefore submitting to the Congress the Reports
elimination Act of 1979. This bill, together with administrative
action we are taking now, will eliminate or simplify 278 annual
agen y reports, saving at least $5.5 million per year.
This overall paperwork reduction program has been developed
in a cooperative effort with the leaders of the Senate Govern-
mental Affairs and House Government Operations Committees.
Working together, we will continue the progress on cutting
away red tape.
I urge the Congress to act promptly on the two bills
I have discussed.
THE WHITE HOUSE,
November 30, 1979.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
OMB has supported HR 6410 because its concept of integrated,
life-cycle, information management has a significant potential
for cost savings. Improving and strengthening all facets of
information management, including the collection, storage,
utilization, manipulation, transmission, and dissemination of
Federal information, is the principle goal of HR 6410. More
specifically, this Bill has five principle objectives:
1. Improving the coordination and integration of Federal infor-
mation policies and practices.
2. Ensuring that needed information is obtained from the public
with the minimum burden.
3. Maintaining information in a manner to maximum its usefulness.
4. Ensuring that the Privacy Act is properly applied to Federal
Information.
5. Acquiring and utilizing ADP and telecommunications systems
in a cost effective manner.
Since any future improvements in information management are
merely speculative, it is not possible to state that any
particular cost savings will be achieved under HR 6410.
However, it is also clear that cost savings in the order
of many millions of dollars per year are not only possible,
but also realistic, under the management improvements which
HR 6410 can bring about. Some cost savings estimates have
been compiled for paperwork, telecommunications and ADP to
provide some illustrations of the possibilities.
Reduction of Paperwork Burden
Both through reports control and through limitations on
excessive regulation, the paperwork burden can be reduced for
the public. Reductions of this paperwork burden under the
provisions HR 6410 can achieve very significant savings.
OMB has estimated that if these provisions can produce a
three percent reduction in compliance costs to the public
Sor..filling out forms, an annual savings of over $200
million per year could be expected. These savings do not
seem unrealistic when we consider, that 0MB estimates that
the public's time costs of current reporting burdens are
almost $8 billion per year, and the Federal Paperwork
Commission estimated that the total costs of Federal paper-
work is more than $100 billion per year.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Telecommunications
Strengthened management of telecommunications systems through
provisions in HR 6410 have a significant cost savings potential.
Three recent GAO reports indicate some possible areas which
are ripe for improvements and their potential cost savings.
A GAO report (LCD-80-9, November 14, 1979) found that
significant savings and improved operations can be
achieved by consolidating and modernizing the Government's
local telephone services:
r -- Twelve Federal departments and agencies spend at least
$219 million annually for local telephone services.
-- Four geographic areas studied in detail indicated a
potential cost savings of $1.4 million total through
consolidation and modernization referenced upon total
annual operating costs for existing system of $16.3
million.
- In a GAO review of Defense Communications cost (LCD-77-10,
December 14, 1977) review of 550 specific circuits costing
over $5.6 million annually are candidates for elimination,
re-configuration, more economical service, or integration
into common-user networks.
- A GAO report (LCD-78-105, December 1977) found that an.
alternative design for DOD secure voice telephone systems
could save $300 million over 20 years.
Improved ADP management through HR 6410 provisions, also,
may bring about significant cost savings. For example, if
a 5% reduction in annual ADP operating costs could be
achieved through replacement of obsolete systems, increased
sharing, improved software conversion, and other management
initiatives, an annual cost savings of $47 million would
result.
Another perspective related to potential ADP savings can
be gained by examining some current initiatives in ADP
management and the resulting cost savings.
- The use of electronic funds transfer by the Department of
the Treasury has resulted in significant interest savings
by permitting faster deposits of receipts from the sale
of gold, foreign military sales, and similar transactions.
These savings totalled $18 million in FY 77, $26 million
in FY 78, and $60 million in FY 79. The savings are
expected to reach at least $350 million between FY 80 and
FY 84.
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
- The Defense Logistics Agency is in the process of con-
solidating its payroll, cost and personnel systems from
nine geographic sites into one. After consolidation,
DLA will use remote computer terminals to provide up-
to-date information to DLA centers, depots and all
Contract Administration Service Regions and Offices.
Beginning in FY 1981, the consolidation effort will
produce savings in personnel, equipment and supplies
of approximately $1.4 million annually.
- The National Aeronautics and Space Administration has
installed an automated Utility Control System at nine
centers where automation of heating, ventilation, and
air-conditioning could reduce energy consumption. NASA
is projecting $12 million in energy savings and $3 million
in manpower savings from this system for the period 1981-85.
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
Honorable Jack Brooks
Chairman, Committee on
Government Operations
House of Representatives
Washington, D.C. 20515
In conjunction with the markup of H.R. 6410, The Paperwork
Reduction Act of 1980, 1 believe it would be helpful for the
Committee to have available a fuller explanation of the
Administration's views regarding the proposed location of the
statistical policy coordination function within the Executive
Branch.
The basic authority for statistical policy coordination is
contained in section 103 of the Budget and Accounting Procedures
Act of 1950. The Act requires the President "to develop programs
and to issue regulations and orders for the improved gathering,
compiling, analyzing, publishing, and disseminating of statistical
information for any purpose by the various agencies in the
Executive Branch of the Government."
The Federal statistical system is lrg9e and decentralized, com-
prising more than 29,000 employees in 0 statistic units.
Because these producing agencies are subject to multiple
channels of line management, the coordinating function is
extremely important. The responsibilities of the coordinating
function include:
o Fostering communication and negotiation among the many
users and producers of statistical information, includ-
ing helping to translate policy issues into statistical
infor`matiori needs;
o Coordinating related statistical programs indifferent
agenciei to help assure they are developed as
consistent components of the whole;
o Identifying. gaps in the base of statistical information
and establishing priorities among defined needs;
o Prescribing the methodological and technical standards
for statistical programs; and
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 Approved For Release 2007/05117: CIA-RDP85-00003R000300050010-5
o Developing and enforcing.... regulations to assure the
objectivity and credibility of statistical information.
The coordinating function was assigned to the Office of Management
and Budget (and its predecessor, the Bureau of the Budget) until
1977, when it was transferred to the Department of Commerce. We
strongly believe that the functic~shouldremain outside of
OMB, anted not be absorbed within an_organization devoted
to paperwork reduction and-'information resource management.
Our reasons for this position fall into two categories.
1. If it is to be effective, statistical policy coordination
and oversight is an important, demanding, and time-consuming
function. As such, it would distract the OMB officials concerned
with regulatory and information policy issues and, in -my view,
inf"e=e `witTi-tZie effective execution of both the objectives of
H.R. 6410 and the directives that the President has given OMB to
reduce the burden of regulations and paperwork upon the public.
2. The importance of statistical policy issues has grown
so great in the past several years as to merit significant and
separ a "emphasis.- The number and size of grant programs driven 7
by statistical grant programs
for example
has grown markedly
,
,
.
In fiscal year 1980, more than $29 billion in CETA, revenue
sharing, elementary and secondary education, AFDC and community
block grants was allocated according tote for just six
statistical series. In the larger context of economic policy,
the effect of statistical series upon inflation is a matter of
real concern. In our view, these policy issues should be
addressed, negotiated, and resolved in an environment separate
from the responsibilities of Mg foF (educing the regulatory and
paperwork burden upon tthe public. Indeed, it was for this reason
that the President approved the transfer of the statistical policy
function from OMB to the Department of Commerce effective October
1977.
Also in 1977, the President directed the Reorganization
Project staff i f0MB to perform a comprehensive review of the
organization of the Federal statistical system. In a memorandum
concerning the study dated May 11, 1978, to the heads of depart-
ments and agencies, the Presi ent-cited his concern with "a
number of persistent problems . . . (that) indicate a pressing
need to improve the coordination of Federal statistical activities,
which are growing at an increasing rate."
The study directed by the President was concluded within the
past two months. Its recommendation, endorsed by a distinguished
and experienced group of advisers (whose names are enclosed), was
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
that the statistical po licy function remain separate from 0MB
and be enhanced by the establishment or Office of Statisti-
cal Poli_cy_ w him the Executive0.ffice of the President. The
President has approved that recommendation and directed that it
be. implemented. As you know from Harrison Wellford's February
29, 1980, letter to you, we have discussed with the Committee
the possibility of implementing the President's decision through
the use of a reorganization plan.
We will, of course, continue to work with you and the Committee
in addressing these concerns with statistical policy functions.
We believe, however, that combining the statistical, policy
function in the same org4nization with responsibilities for
improving the government's information resource management,
reducing the paperwork bur d En -and making the Fedeza1- regulatory
programs more effective will either submerge important statis-
tical issues or drive out other functions. For this reason,
we shy urge the deletion of Se67'~04'(d) from H.R. 6410.
Wayne G. Grangliist
Associate Director for
Management and Regulatory Policy
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Membership of the Statistical Reorganization Project Advisory
Committee
Vincent Barabba, Rochester, New York. Then Director of Marketing
Research for Xerox Corporation. Now Director of the Bureau
of the Census.
Richard Ruggles, Professor of Economics, Yale University.
William Shaw, retired Vice President of DuPont Company, former
Assistant Secretary of Commerce for Economic Affairs 1966-68.
Graham Allison, Dean of the Kennedy School of Government at
Harvard University.
Patrick Caddell, President of Cambridge Survey Research.
William Kruskal, Statistician and Dean of Social Science, Univer-
sity of Chicago.
Phyllis Wallace, Professor of Economics at the Massachusetts
Institute of Technology.
James Bonnen, Professor at the Michigan State University, served
as Director of the project staff.
Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
Honorable Jack Brooks
Chairman, Committee on Government
Operations
House of Representatives
Washington, D.C. 20515
When I testified before you on February 21, 1980, I requested the oppor-
tunity to submit additional comments on H.R. 6410. Enclosed are those
changes which I believe the committee should consider as they mark up
the bill. The changes include both those I discussed in my testimony
and some additional technical amendments.
I enjoyed riecting with you last Thursday and stand ready to assist
you or your staff in moving ahead on this legislation.
Sincerely,
Wayne G. Granquist
Associate Director for
Management and Regulatory Policy
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
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PRESIDENT'S
REORGANIZATION
Enclosed is our final report for the Federal Data Processing
Reorganization Project to be forwarded through Mr. McIntyre to
President Carter.
APR 2 3 1979
APPENDIX C.-PRESIDENT'S REORGANIZATION
PROJECT
V I PROJECT
Mr. Wayne G. Granguist
Associate Director for Management and
Regulatory Policy
Office of Management and Budget
Washington, D.C. 20503
_- Dear Mr_Gra ist?
We understand that you will use this document and the ten Study
Team reports as a basis for producing a Presidential Decision
Memorandum which we hope will elicit the Presidential initiative
needed to bring about the changes we are recamnending. To further
assist you in this effort, we plan to submit a proposed draft of
a Presidential Decision Memorandum within the,next few days.
We applaud your current efforts to bring about a "managerial
cohesiveness" of OMB, GSA, and DOC in their leadership roles
related to managing Information Technology Resources. We hope that
you will call on us if we are needed.
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PRESIDENT'S
REORGANIZATION
1 PROJECT
TO: Project Members, PRP/FDP
FROM: A. Pn, B. R=d-.., Eeeman
SUBJECT: Final Summary Report
The enclosed copy of the final report reflects a number of comments received
relative to the last draft copy and is improved by'them. We realize that further
improvement to the report might be possible, but the time has come to formally
submit our recommendations in order to stimulate the actions for which we are
calling.
It is our understanding that this report as it stands will be transmitted through the
OMB to the President. With this document, the President will receive a PDM
written by the OMB with our cooperation and input. Those of you who wish to
go on record regarding some aspect of the report should do so promptly by- letter
to the OMB.
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212
ACK O LEDGIENT
An impossibly long list would be required to
acknowledge individually all the persons and organ-
izations, both inside and outside Government, that
have, in either official or unofficial capacities,
contributed their ideas and their time to the work
of this project. Although a detailed listing of
individual acknowledgments has been omitted here
for practical reasons, we would like to m- phasize
that the reccnumendations contained in this report
have not been produced in a vacuum, nor are they
all new; in fact,?in many cases these same
reccnmendations were first suggested by persons
now in Government service, or are contained in
reports of previous studies.
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213
TABLE OF CONTENTS
Background and Purpose of the Study ......... 1
Study Findings .......................................... 2
Study Conclusions ....................................... 4
Human Resources Team ...................... A-5
National Security Team .................... A-15
Small Users Team .......................... A-19
General Government Team ................... A-22
Science and Technology Team ............... A-26
Acquisition Team .......................... A-29
Operational Management Team ............... A-34
Standards Team ............................ A-42
Personnel Team ............................ A-45
Central Agencies Team ..................... A-48
Chapter III: Federal Data Processing Reorganization Staff .. A-56
II. RECOMMENDATIa1S ............................................ 5
III. THE MINORITY POSITION ....................................... 19
APPENDIX
Chapter I: Project History and Methodology .............. A-i
Chapter II: Summaries of Team Reports .................... A-3
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214
I. INrRODUCrION
Background and Purpose of the Study
The Federal Data Processing component of the President's Reorganiza-
tion Project, with a membership comprised of 55 outstanding computer
professionals selected from both the public and private sectors, was
initiated to examine the ways in which the Federal Government acquires,
manages, and uses data processing technology and to make recommendations
that will help the Government (1) improve the delivery of services through
the effective application of computer and related telecamnunications
technology; (2) improve the application and management of the relevant
resources; (3) eliminate duplication and overlap in agency jurisdiction
relative to computer issues; and (4) improve the productivity of the
Federal data processing work force.
As the work of the project matured, the group chose to adopt
the term "information technology" as the primary descriptor for the obj4ct
of its study, deciding that the term "data processing" - a phrase
traditionally associated with administrative record keeping - does not
adequately reflect the rapid and important convergence of the computer
and the communications technologies. The work was carried out through
ten independent study teams: Human Resources Team, National Security Team,
Small Users Team, General Government Team, Science and Technology Team,
Acquisition Team, operational Management Team, Standards Team, Personnel
Team, and the Central Agencies Team. During the course of the study, an
extensive review was made of all pertinent Executive orders, policy
statements, records of hearings., and other legislative and administrative
documents, and hundreds of interviews were conducted with information
technology and management experts throughout the Nation. As a result of
this broad review of the use and management of information technology
within the Federal Government, the members of the Federal Data Processing
Reorganization Project developed the sets of findings, conclusions and
recommendations contained in the individual reports -of the ten study
teams. (Copies of the ten study team reports may be obtained from the
National Technical Information Service.)
At that point, it was agreed that a report which presented an
expression of carman agreement was needed. To seek and identify this
expression of agreement, a leadership group was appointed and a period
of consensus-seeking meetings, report drafts, telephone conferences,
and interpersonal communications was initiated. During that period,
every effort was made to give each study participant a voice in this
final report.
A more detailed statement of study methodology and individual team
report summaries are presented in the Appendix. Readers interested in the
details leading to the conclusions and recamnendations presented herein
are encouraged to review individual team reports.
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Study Findings
The summarized recndations of this study as presented in Section II
of the report are based on the following study findings:
* The Federal Government is irreversibly and increasingly camitted
to the use of information technology to manage its resources,
provide its services, and protect its citizens.
* Information technology can be an effective means of reducing the
costs of Government, and may be the only means of expanding
governmental services without increasing budgets.
* Accelerated development of, and camnitment to, information
technology, though not a goal in and of itself, is a means by
which an information-intensive society may be able to achieve its
objectives.
* The Federal Government is, in general, mismanaging its information
technology resources and has not developed a plan for exploiting
the opportunities of the future with respect to investment, service
delivery, protection of citizens, or national security. This
condition is manifested by such major symptoms as:
- Public complaints about delays and inaccuracies at many service
delivery points.
-- An inability to protect the rights and privacy of individuals
fran intrusive practices of Government agencies and others.
- Growing obsolescence of equipment, systems, and personnel.
- Increasing economic threats which have been accelerated by the
availability of technical information and products flowing
freely and uncontrolled from the United States into canpetitor
nations.
- A military enterprise which is operationally vulnerable as a
consequence of obsolescent equipment and systems and under-
developed technical personnel.
These major symptans are principally caused by:
- The apparent unwillingness of the Office of Management and
Budget to exercise managerial (in contrast with budgetary)
control over information technology.
- The failure on the part of the Office of Management and Budget
(CMB), the General Services Administration (GSA), and the
Department of Commerce (DOC) to effectively discharge the
responsibilities assigned to them under P.L. 89-306 (the Brooks
Law).
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- Abdication by program agency management of its -responsibility
for managing information technology as a mission-oriented
resource.
Tensions between the legislative branch and the executive
branch of government: in the absence of leadership from the
OMB, the GSA, and the DOC, the House Governnent Operations
Committee has become the de facto manager of much of the
acquisition of the Federal Government's information tech-
nology resources; these activities plus those of other legis-
lative groups carbine to comprise a level of activity which
stresses the limits of normal oversight of program and mission
agencies and can preempt the decision process of the executive
branch.
These summary findings indicate an urgent need to exploit and
accelerate the application and development of information technology to
reduce the cost of Government, improve service delivery, protect cur
privacy, improve our individual and military security, and maintain world
leadership in a technology that holds the keys to a new era.
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Study Conclusions
As it uncovered various serious problems with the Federal Govern-
ment's employment of information technology, the Federal Data Processing
Reorganization Project soon discovered that those problems often took the
form of a basic dilemma. On the one hand, the prudent application of,
information technology to agency or program missions should and must be
the primary responsibility of agency or program management; on the other
hand, the study teams found that, in general, agency or program managers
do not exercise the required responsibility, and that the users of data
processing services in the Federal Government are seldom held accountable
either for the effective use of such services or for planning and justi-
fying the use of similar services in the future.
Moreover, the teams found that the dilemma extends even to the
"central" agencies - the Office of Management and Budget (CM), the
General Services Administration (GSA), and the Department of Commerce
(DOC). On many occasions during the course of the study, debate centered
around two related questions: (1) whether some particular central agency
actually has the ability or the will to do something it has been mandated
to do; and (2) whether a responsibility which has not been honored by some
particular central agency should now be reassigned to some other agency,
or perhaps to a Special Assistant to the President. Once again, the
dilemma. On the one hand, certain responsibilities belong naturally to
certain agencies and should not arbitrarily be placed somewhere else; on
the other hand, the history of those agencies causes many knowledgeable
observers to doubt whether these agencies are capable of changing themselves
sufficiently to accept and exercise their responsibilities.
As the ten study teams confronted the basic dileffm. in one or another
of its various manifestations, they offered solutions which, despite
natural differences in preferred phraseology, form a remarkable consensus.
That consensus is expressed in the following statements:
With regard to the line agencies, the Federal Government must estab-
lish clear and measurable criteria by which mission performance can be
judged; then, reward competence; and, by rewarding it, build it and
strengthen it. The building and strengthening of such competence is the
major task faced by the Government.
With regard to the central agencies, the Federal Government must
bring about a managerial revitalization - a revitalization characterized
by a rechanneling of central agency efforts into positive programs intended
to provide the Government with energetic and knowledgeable advocacy for the
effective use of information technology.
In general, the current condition of the Government will not imorove
without major changes in attitude with respect to information technology.
A systematic and integrated effort will be required to effect needed
chances. This effort will require a commitment enunciated and driven by
the President.
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The nine recommendations presented in the following pages represent
a consensus developed from the common themes that Emerged from the
efforts of the ten independent study teams. The separate reports of those
ten teams should be consulted for detailed discussions of the findings,
conclusions, and analytic processes upon which the nine major recommenda-
tions are based. For instance, the Acquisition Team report describes the
confusion, delays, and frustrations which characterize the current process
for acquiring information technology resources; the Operational Management
Team report develops and supports an important managerial concept called
"Earned Autonomy" as an answer to the dilemma outlined on the previous
page; and so forth.
Since the material presented in this report is not a summary of the
individual team reports, the reader of those various reports should
not expect that all of the recommendations of the ten study teams translate
directly into the nine major reccrunendations set forth here. The reason
for this is that there were various recommendations vigorously proposed
by individual teams which did not survive the distillation process that
served to develop these recommendations.
As was stated in the Acknowledgments section of this report, fed of
the ideas and recommendations offered by the study group are "new." What
is needed for the management of information technology in the Federal
Government is not new ideas, but new and energetic action - action which
will promote the productive use of information technology across the entire
Government.
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RECO4MIDATION 1: THE FEDERAL GSIERNMENI NEEDS TO TAKE ACTIONS THAT
WILL ESTABLISH THE IMPORTANCE OF INFORMATION TECH-
NOLOGY, PROVIDE TOOLS FOR ITS MANAGEMENP, AND SET
NATIONAL AND FEDERAL GOALS FOR ITS PRODUCTIVE USE.
* The top management of program and mission agencies must effectively
relate information processing resources to program and mission
requirements. In both the civil and defense agencies of Government,
senior Government administrators should:
- Initiate and maintain review and evaluation procedures which assess
the reliability and validity of their information management systems.
- Became involved in the planning and design of the new information
management systems on which their agencies will become dependent.
- Test and qualify the judgments of technicians in areas which
impact agency data needs.
- Demand managerial responsibility for the costs of the information
management systems which support their agencies.
-- Actively require the use of information technology to reduce the
unit costs of service delivery.
* The Office of Management and Budget should establish an office of
Information Resource Management (IRM) at the Executive Associate
Director level. The person holding, this position should be given a
broad mandate to create and reinforce a good system of information
technology management. A primary purpose of this office would be
to provide a focal point within Government for the aggressive
advocacy of the use and management of information technology in
order to reduce the costs of Government and to make it more
effective.
* The OMB should require each department or agency of Government to
establish an Information Resource Manager as an assistant to the
agency head. The IRM would comprise a staff uncanpranised by
vested interest in any particular canputer facility and would be
accountable for the following actions leading to the efficient
and effective use of information technology throughout the
organization served:
-- Oversee the develcpmnt and on-going operation of the organiza-
tion's information technology long-range planning mechanism and
coordinate this planning with agency program planning.
Encourage technological innovation in the provision of service
delivery by the organization, within existing budgetary,
technological, and organizational resource constraints.
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-- Monitor the delivery of services by the organization, and advise
the Secretary/Administrator on the best use of information
technology to increase the efficiency of such services.
- Advise the agency head on areas in which the information tech-
nology can be used to increase the overall effectiveness and
productivity of information processing activities in support
of the organization.
* The 0,MB should establish a National Council for Information Tech-
nology Policy, Plans and Programs. This Council should be chaired
by the Executive Associate Director for Information Resource
Managemdnt of CMB. The Council's voting membership should be
made up of the Chairperson and the various Information Resource
Managers discussed above. Membership should also be open to key
representatives of House and Senate camnittee staffs. The role
of the Council would be to:
-- Keep the President and Congress informed about the state of
information technology as it is applied in Government.
-- Keep the President and Congress informed about the opportunities
and problems presented by advances in technology.
-- Identify and clarify issues of information technology policy,
plans and programs as they pertain to governmental operation,
public well-being, and international relations.
- Issue positions and recamnendations on privacy and confidentiality
matters.
- Foster continued U.S. world leadership in information technology
and identify the research and development programs needed to
lengthen that lead.
* The recamnended Executive Associate Director for Information Resource
Management (EADIRM) and the various Information Resource Managers (IRM)
must not be considered simply "elevated positions" that currently exist.
These are new positions to be filled with information technologists
with records that clearly place then among the Nation's best as techno-
logists and as executives. The EADIRM and the new IRMs are perceived
as forming a peer group capable of collectively addressing the oppor-
tunities of information technology through the proposed National
Council for Information Technology Policy, Plans, and Programs. These
positions should be filled from the private sector and from within the
Government through effective use of the new Executive Service category
or the use of IPAs as appropriate. The thrust is for a continuing
infusion fran the private sector and for the release of untapped
resources within the Government.
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RECDSMENDATICN 2: THE FEDERAL GOVERNMEN I' NEEDS TO INPBCVE AND EXPAND
ITS USE OF MODERN INFORMAATICN TECHDTOLCG'Y TO INCREASE
AND ENHANCE THE LEVEL AND QUALITY OF GOVEPNMENTAL
SERVICE DELIVERY WHILE REDUCING COSTS.
* The Federal Government should establish a nationwide computer-
communi-cations network of service delivery centers which support eligibility
and claims processing and determination.
* The Office of Management and Budget should form and direct a
Presidential task force to study (in detail) the consolidation and
centralization of human services delivery, and should establish a
policy initiative and timetable for the consolidation of human resource
programs under a single integrated eligibility determination system
which has strict safeguards against violation to individual rights,
privacy, and due process.
* The Office of Management and Budget should encourage and support
research programs directed to improve service delivery processes.
Maximum effort is needed to improve and continually refine the
Government's processes for benefit applications and claim processing
in order to achieve and extend the economies of scale in high-volume,
labor-intensive areas.
* The Office of Management and Budget should encourage and support the
development of a set of uniform data definitions for human service
delivery. Such definitions are needed to facilitate the aggregation
of data across programs for various purposes which do not violate
privacy, individual rights and due process.
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RECOMMENDATION 3: THE OFFICE OF MANAGEMENT AND BUDGET NEEDS TO Is'SPABLISH
A POLICY REQJI?ING THAT LASTS OF DATA PROCESSI_NJ BE
CHARGED BACK TO THE USING P3ETICY AND PROGRAM IN
PROQS-RELATED TERMS.
* Throughout the Federal Government, immediate actions should be taken
to bring about a management system in which the products of information
technology can be measured and evaluated in program-related terms.
To do this, certain tools, actions, responsibilities, and authorities
are appropriate and should be fostered by the OMB:
- The zero base budgeting process should be intensified and
refined as an integrated management tool for on-going program
tracking and management. This process calls for the development
of key indicators by which effectiveness and efficiency can be
measured.
Cost systems and indicators should be developed for measuring
~performance.against end purposes and agency missions in units of
service delivery. Work measurement, unit costing, and productivity
indices, service quality indices, responsiveness indices, etc.,
should be used where appropriate.
Responsibility and accountability for effectively managing
information resources shaild be focused on the program managers
responsible for delivering services to the public or to other
governmental bodies. Program managers should have decision
authority commensurate with their financial decision-making
authority in non-information technology areas including the
ability to make decisions between alternate sources of supply.
This includes the responsibility for making investment choices
and decisions for competitively acquiring information technology
resources and services in accordance with OMB Circular A-76.
These managers should seek a reduction each year in the unit
costs of service delivery.
Information technology costs should be required to flow
directly into end-item (product or services) unit expense.
All costs should be included, direct and/or indirect, including
appropriate allocation of long-term and capital costs. All
shared facilities should be placed on a full charge out basis.
Users should contract with data processing installations for
the cost, quantity, and quality of service to be provided in
user oriented terms.
Data processing service centers should be performance audited
periodically to determine whether they remain cost-effective.
Evaluations should consider both cost and quality of services
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* Agencies should be required to prepare five-year information technology
plans which are coordinated with the agency's budget and program plans.
Major new information technology acquisitions and the programs they
support should be identified so that sociopolitical issues can be
addressed and resolved early. These plans should prepare each agency
to submit "cost-based" as well as "obligation-based" budgets in
fiscal year 1981. (Departmental activities must be managed on a cost
basis even though Congress may prefer to examine budget proposals
in its historic fashion.)
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RECO64.1ENDATION 4: THE FEDERAL GCI/ERNMENT NEEDS TO SET AS AN OBJECTIVE
THE REMOVAL FRCt4 SERVICE OF ALL INFORMATION
TECHNOLOGY COMPONENTS 'OUCH HAVE OUTLIVED THEIR
COST-EFFECTIVE LIFE.
* The Government should obtain and maintain an information technology
base that is sufficient to meet the needs of the Nation's economic life
and its military posture. The cost of lost opportunities for providing
improved Government services must be reduced. The hidden costs incurred
when timely improvements are not made must be avoided. (These costs
begin with such factors as the increased maintenance costs required by
failing equipment and outdated software. Added to such costs are those
incurred when unreliable equipment causes data reruns, underutilization
of the better trained personnel, and the loss of potential contributions
of promising personnel who decline Government employment because the
working environment does not challenge their technological competence.)
* The Government should set an objective to remove from service all
information technology components which have outlived their cost-
productive life:
- The OMB should establish guidelines for determining the cost-
effective life of equipment in order to control obsolescence.
Each program agency should evaluate its computer inventory in the
light of those guidelines.
- The OMB and the agencies should jointly fashion capital requirements
plans for the agencies, with clear priorities set among the competing
needs identified.
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RECOMMENDATION 5: THE FEDERAL GOVERNMENT NEEDS TO SIGNIFICANTLY ALTS ITS
PROCESS FOR ACQUIRING INFORMATION TECHNOL GY RESOURCES.
INCREASED EMPHASIS SHOULD BE PLACED UPON THE PLANNING,
NEEDS DEFINITION, AND JUSTIFICATION PHASES OF ACQUISITION.
* The Brooks Law (P.L. 89-306) provides the legal framework for the manage-
ment of information technology resources; recent guidelines for the
application of OMB Circular A-109 to the acquisition of major infor-
mation technology systems are consistent with this framework and have
the virtue of applying a standard Federal procurement policy to the
acquisition of major information technology resources. We applaud the
spirit and direction of this effort; it should be extended to cover
information technology resource acquisition in general through the
application of the proposed Federal Acquisition Act of 1977 so that
information technology acquisition can be viewed as a mission support
function rather than as an end in itself.
In the absence of a standard Federal procurement policy hospitable
to information technology, the following actions and guidelines are reccm-
mended:
* More procurement responsibiiity should be delegated to the agencies.
Specifically:
-- The threshold requiring GSA delegation of procurement authority
should be raised fran $50,000 to $300,000.
-- A certification process should be established under which GSA
would give an agency blanket delegation of procurement authority.
Such certification ("Earned Autonomy") would be renewable annually
upon determination that qualifying conditions by GSA have been
met. Certification could be withdrawn by GSA for cause..
Qualifications for certification would be determined by GSA.
Operation of the process would be GSA's responsibility.
* Action should be taken under currently legislated authorities to
clarify specific responsibilities between the Office of Management
and Budget and the General Services Administration with respect to
pranulgation and issuance of management, acquisition, and procur nt
policy and procedures. The C MB should specify responsibilities,
identify specific policies requiring clarification, set timetables
and monitor canpletion. As a minimum, the following items require
immediate attention:
- Policy covering the continued support to program agencies which
obtain data processing services from another agency under the
sharing program, when equipment is to be replaced.
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226
- Guidelines for applying Ohl Circular A-76 to data processing.
- Policy concerning treatment of software conversion costs in
evaluating new procurements.
- Guidelines for the development of functional specifications to
be used in solicitation documents.
- Policy governing incremental upgrades of existing resources.
- Policy defining canpetitive procurements in various situations,
describing under what conditions competitive procurements are I.
in the best interest of the Government, and setting up a mechanism
for monitoring program agency adherence to these policies.
- Policy and guidelines on technological obsolescence as a factor
in replacing canputer hardware.
- Responsibility for enforcement of standards related to new
procurements.
- Resolution of inconsistencies in automatic data processing equip-
ment classification between the ADP Schedule contracts and the
Federal Supply Schedule contracts.
* Acquisitiors with a system life-cost in excess of $1 million should
be conducted only by data processing and contracting personnel who
are qualified specialists in the computer acquisition function.
The recommendation visualizes that agencies with full-time specialists
(certified by GSA) should be given delegated procurement authority.
Where such specialization does not exist, GSA should conduct the
procurement. It is intended, as a minimum, that this policy apply to
all large-scale canputer hardware and large services acquisitions
especially where benchmark techniques are used.
* Proposed acquisitions with a price over $1 million should be
specifically identified in budget documents and thus became more
visible for management and budget reviews.
* More formalized procedures should be adopted when delays are imposed
during the acquisition process. Whenever the normal acquisition
process is halted by organizations external to the program agency, such
as GSA, OMB, or congressional ccnmittees, the program agency should be
advised in writing as to the reasons for the halt and informed of
the actions required to resolve any problems.
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RECOMMENDATION 6: THE FEDERAL GOVERNMENT NEEDS TO UPGRADE THE TRAINING
AND CAREER DEVELOPMENT REQUIRED FOR FUNCTIONAL MANAGERS,
RECLASSIFY PERSONNEL -SKILLED IN THE MANAGEMENT OR
USE OF INFORMATION TECHNOLOGY, AND ESTABLISH APPROPRIATE
CAREER PATHS FOR SUCH PERSONS.
* The program and mission agencies and the central agencies should upgrade
the training and career development required for functional managers,
conduct a comprehensive reclassification of personnel skilled in the
management or use of information technology, and establish appropriate
and-attractive career paths for such persons. To accomplish these tasks
the agencies should:
-- Require information systems training for functional managers
in Grades 14 and above.
-- Establish a new occupational group, "Information Science," with
appropriate job series to reflect the changed nature and role of
data processing in the Federal Government and changed job
specialties.
- Provide a central focus to information technology training and
career development through the establishment of a Federal Data
processing and Career Development Institute.
- Make effective use of cooperative training and summer intern
programs with colleges and universities which offer computer
sciences curricula and degrees.
- Establish communications lines between agencies and the Civil
Service Commission to improve agency knowledge of the
recruiting and examining process.
- Modify existing legislation to allow delegation of examining
authority to the heads of agencies.
-- Establish appropriate occupational series for and provide
specialized training in data processing contract preparations,
RFP preparation, contract performance amnitoring, and contract
administration.
-- Support long-term efforts supporting the development of suitable
criteria and methods for formal certification of data
processing personnel.
* The Department of Defense should:
- Provide for a military career path in each service which includes
provision for progression to General'in recognition of the
extreme importance of information technology specialists to the
national defense mission.
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-- Take the measures necessary to fill certain vitally importan t posts
in the military service with qualified general officers conuetent
in the management of information technology.
Establish the training programs necessary to ameliorate the problem
of personnel obsolescence.
* The importance of the people who the
cperate systems that control and
manage the Government's information resources should be emphasized;
bonding and clearance requirements for operations personnel who .
control and handle data should be established.
ppr v
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RECOMMENDATION 7: THE PROGRAM AND MISSION AGENCIES NEED TO BE STRENGTHENED
TO MEET THE GENERAL REQUIREMENTS FOR MANAGERIAL AND
TECHNICAL EXPERTISE IN INFORMATION TECHNOLOGY. THE
AGENCIES MUST HAVE PROMPT ACCESS TO RESOURCES WHICH
CAN HELP THEN SOLVE THEIR PROBLENS.
* The Office of Management and Budget should maintain an awareness of the
requirements for managerial and technical specialization and be willing
to directly allocate to identified centers of expertise the personnel
positions necessary to meet these requirements.
* Whenever a sufficient unmet demand exists, Specialized Assistance
Centers (SACs) should be established to provide fully cost-reimbursable
managerial as well as technical services to Government agencies.
- SACS should be administered by host agencies that are capable
of and willing to support them, or by an agency designated by the
0MB.
- SACS should be managed and reviewed by their respective host
agencies, the CMB, GSA, and congressional oversight camnittees.
The SACs should be financed through the GSA's ADP Fund.
- The Department of Commerce should establish and sponsor a federation
of SACs to create a community of data processing expertise within
the Federal Government, and to provide joint policy, procedures,
and planning for individual SACs. Both the 0MB and the GSA should
have representation in the federation.
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* The Office of Management and Budget should foster and support research
in the nondefense sector to deal with advanced software techniques
such as formal verification of the correctness of canputer programs;
data base management systems for very large, shared distributed data
bases; distributed computer architectures with terminals for. the many
counselors and service providers who interact with the public;
archival storage technology; and, especially, human factors, privacy,
security, and "robustness." The research and development that?is
required extends beyond the theoretical and laboratory work all the
way up to prototype testing. Such a research and development program
for computing and camnunications technology should have an initial
funding level on the order of $25 million annually; over the first
.five years at least 75 percent of the funds should be spent on
contracts with private and university sectors.
national computer network to serve the nondefense research efforts.
Such a network would provide a unifying influence on programs and
projects based in both the public and private sectors. These
projects should also be closely coordinated and interactive with
the information technology part of the defense research and develop-
ment community where security considerations permit.
* The Office of Management and Budget should foster and support an
augmented capability for using advanced computer techniques to keep
track of the location and availability of experts in all the
specialized areas of information science and technology.
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RECOMMENDATION 9: THE FEDERAL GOVERNMENT NEEDS TO REVITALIZE ITS EFFORTS
TO ESTABLISH AND MAINTAIN A STANDARDS PROGRAM FOR
INFORMATION TECHNOLOGY IN ORDER TO SUPPORT THE
ECONOMIC PURCHASE OF EQUIPMENT AND THE ECONOMIC AND
EFFECTIVE OPERATION OF NMP1JTER RESOURCES.
The Federal Government should promote the adoption and acceptance of
authoritative, workable standards for information processing to
facilitate the cost-effective use of the technology within Government.
* The standards enforcement roles of the Institute for Computer Science
and Technology, of the General Services Administration, of the Office
of Management and Budget, and of the agencies should be clarified.
The responsibility for measuring, determining, and reporting on
compliance is the responsibility of the Secretary of Commerce; the
responsibility for the application of sanctions belongs to the GSA
for procurement and with the OMB for operational standards. Sanctions
should be applied in cooperation with the technical support and
compliance monitoring responsibilities of the Department of Canmerce.
* The Secretary of Catamerce should remove the Institute of Computer
Science and Technology from the National Bureau of Standards, and
assign the responsibility for information technology standards to
the Assistant Secretary for Science and Technology, who should
institute a program to anticipate, identify, prioritize, and develop
needed standards in the Federal Government.
* The Office of Management and Budget should direct each department
and agency to establish a central Standards Management Office, or
equivalent, which would be responsible for the management of a
standards program within the department or agency. The Office of
Management and Budget should establish the consultant resources
needed to assist it in carrying cut its responsibilities with regard
to the implementation of standards.
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232
III. THE MINORITY POSITION
One important difference of opinion among the members of the study
group has remained unresolved, and it is therefore appropriate to include
in the project report a summary of the minority position on this
disagreement.
The study team agrees that the central agencies (CMB, GSA, and DOC)
have failed to establish a record of credibility, and that the OMB is so
firmly set in its Emphasis on budgetary control that there is reason to
doubt that it will be able to adopt the positive management style needed
to implement the recommendations of this study.
The majority view holds that the foregoing reca:miendations can and
must be implemented through a strong and persevering Presidential
initiative through the CMB. The minority agrees but further holds that
the required Presidential initiative must be of sufficient strength to
establish and support a Special Assistant to the President for Informa-
tion Technology Policy, Plans, and Programs. The majority group objects
to the appointment of sdch a Special Assistant; the minority group answers
the majority's major objections as follows:
Objection 1: Special Assistants do not work. Executive departments
and agencies will respond much sore quickly to the words of their
top management than to "Special Assistants" who are rarely seen.
Reply: There are ample precedents to demonstrate that Special
Assistants do work. The Council on Environmental Quality, the
Council of Economic Advisors, and numerous other special assistants
within the White House are among these. It is clear that their
success depends heavily on the skill and leadership ability of the
individuals filling the positions.
Objection 2: The presence of a Special Assistant establishes an
advocacy position close to the President for a special interest
group, yet the President gets all the special interest pressure
he can stand."
Reply: The minority group appreciates the tumultuous situation
this envisions, with many advocates pleading for a variety of
special interests, but believes that this President has the tech-
nological background needed to benefit from a Special Assistant
whose interests lie in exploiting the information technology to
achieve the Nation's ends. Furthermore, the President is already
receiving special interest pressures in this area from the
legislative committees.
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Objection 3: Information technology is not that important. It is
just one more technique that can be used.
Reply: This position ignores the fact that the information industry
in the United States impacts more than half of the GNP, and is growing.
The Government is information-intensive and must therefore become
canputer-intensive. The rate of increase of computing capability
(the computing power available per dollar) offers the only hope fore
dealing with the growth of the information on which the Government
functions.
Objection 4: A new position outside of the OMB would create a conflict
in responsibilities within the existing executive branch structure,
which can be more damaging than helpful.
Reply: This perceived conflict is viewed as a needed "healthy tension"
necessary to insure that the OMB will be constantly reminded of its
management role. If the OMB becomes more aggressively "managerial,"
then the need for the Special Assistant will dissipate. When the need
dissipates the office should be abolished.
Objection 5: The most effective tool any President has for bringing
about change in Government operations is the 0MB.
Reply: It is agreed by the minority that this is how it should be;
however, the CMS lacks the credibility needed to effect the changes
called for in this report. Numerous GAO reports substantiate this
position, and, as an experienced former Government official pointed
out: "for a whole variety of reasons... including at times weak
leadership, OMB has not been as effective as it should be. This has
been particularly true in carrying out its management missions, and
I think it is fair to say that it has never really fulfilled its
management mandate." The minority of the study group agrees, and
adds that there is little reason to expect change, in view of the
following:
-- The adoption of zero base budgeting had the benefit of a
Presidential initiative; yet, even so, the rank and file
of the OMB have viewed ZBB as a process for gathering
budget data, rather than as a component of a comprehensive
management system.
- The OMB views itself as staff to the President with a role.
which is passive, independent, and objective. This role
has been so carefully maintained and instilled in the OMB
personnel that there is little hope of effecting required
changes in attitude.
- The dominance and importance of the budget process is so
great that the OMB will never have an effective management
canponent.
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-- The current cabinet-centered management style of the President
reduces the likelihood of a more active role for the 0[B.
In fact, superimposing an unwelcome "advocacy" or leadership
role on the OM would further jeopardize its effectiveness
in its natural posture of budgetary control.
in summary, a minority group of the Federal Data Processing Study
team respectfully holds that the President needs the counsel of a Special
Assistant regarding the long-term goal-of increasing governmental
effectiveness through the appropriate application of the tools of informa-
tion technology. In addition to counsel regarding these internal issues
of Government, the President needs counsel regarding the international
developments related to information technology. Therefore, the person
chosen for this office should be one of major stature: a man or wanan who
possesses not only unquestioned technological qualifications but also a
solid record of managerial success, including involvement in the inter-
national arena.
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235
APPENDIX
Evolution of the Federal Data Processing Study
As one of the 31 Presidential Reorganization Projects, the Federal
Data Processing Reorganization Project was initiated to:
* Improve the delivery of governmental services through the
effective application of canputer and related telecommunications
technology.
* Improve the acquisition, management, and use of these resources.
* Eliminate duplication and overlap in agency jurisdiction relative
to canputer issues.
* Improve the productivity of the Federal data processing work
force.
Prior to the beginning of the study, the Office of Management and
Budget developed a statement of the possible issues to be examined during
the course of the study. This statement of issues was published in the
Federal Register with a request for comments by interested parties. Over
one hundred written camments were received fran Government agencies and
the general public. The camnents were analyzed and a discussion draft
was sent to members of Congress, officials of the executive branch, and
all of those who canmented on the issues published in the Federal Register.
In general, the response to the discussion was favorable, and the draft
became the basis for conducting the study.
Conduct of the Study
Fifty-five professional staff members were recruited to work on
the Federal Data Processing Reorganization Study. Twenty of them were
from outside the Federal Government, with their services being donated
by their employers through the Executive Loan Program. The thirty-five
Federal employees were detailed Fran their agencies to work on the
project.
The project staff was divided into ten study teams and a project
management group. Five of the study teams were designated to address
planning and management issues which are unique to individual operating
agencies and to obtain further views on Government-wide issues. These
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teams and their areas of concentration were:
Human Resources Team: Department of Health, Education, and
Welfare; Department of Labor; Veterans Administration;
etc.
National Security Team: Department of Defense.
Small Users Team: Securities and Exchange Camnission;
Small Business Administration; Federal Trade Commission; etc.
* General Government Team: Department of the Treasury;
Department of Justice.
* Science and Technology Team: National Aeronautics and Space
Administration; Department of Transportation; Environmental
Protection Agency.
The remaining five study teams addressed issues which are caiman
to all agencies. These teams and their areas of concentration were:
* The Acquisition Team: problems relating to the process of
selecting and acquiring computer hardware and services.
* The Operational Management Team: problems pertaining to the
design of systems and management of data processing operations.
* The Standards Team: problems pertaining to computer and
related telecommunications standards issues.
* The Personnel Team: problems relating to personnel management
issues unique to the information technology community.
* The Central Agencies Team: problems pertaining to the
relationships among the agencies which were assigned a special
role in guiding the Federal Government's use of information
technology under P.L. 89-306.
Each of the ten teams developed its own methodology and further
defined the issues it was studying beyond those presented in the basic
framework of the discussion draft of August 30, 1977. The teams gathered
and analyzed data which served as the basis for a.separate report prepared
by each team. A draft of each report containing the methodology used by
the team, the team's findings and conclusions, and an analysis of the
options considered by the team was distributed to several hundred
interested parties for public comment. The interested parties included
representatives of executive agencies, the Congress, trade associations,
the media, and others. The camnents received were considered in preparing
each team's final report. Each team's final report contains, in addition
to the topics included in the public exposure draft, the team's recommenda-
tions and, in many cases, implementation plans.
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APPENDIX
This chapter of the final project report contains summaries of each
of the ten study team reports. Each summary states the team's objective,
identifies the team members, explains the methodology used by the team,
and outlines the team's major findings, conclusions, and recammendations.
To arrive at its recce mendations, each team considered various
options for solving the problems it identified. These options, which
ranged fran doing nothing to radical change or upheaval, can generally
be categorized as follows:
* Modification of policies, procedures, and regulations
* Changes in laws
* Different personnel administrative practices
* New budgeting and funding practices
* Different operating practices
* Development of management and technical personnel
* Altered management roles and responsibilities
* New uses of information technology to solve specific problems
* Alternate ways to stimulate the development and use of
information technology
When considering the pros and cons of an option, each team in a
variety of intuitive or quantitative ways evaluated that alternative
against such criteria as:
* Feasibility and ease of implementation
* Degree to which laws must be changed
* Acceptabilty to Congress, the office of Management and Budget,
the General Services Administration, the program agencies,
and industry
* Enhancement of personal and organizational accountability
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*
Mount of organizational disruption
*
Effect on cost within the Government or in what it acquires
*
Degree to which the President's carmitment to Federal employees
is served
*
Degree to which the President's Cabinet management concept is
served
*
Effect on relationships between Government and outside industry
*
Effect on the economy
*
Eff
t
i
d
f
i
ec
on nat
onal
e
ense/secur
ty of the Nation
*
Effect on mission accomplishment
*
Degree to which an 'cption will clarify, responsibilities,
procedures,, and reduce cost
Payback visibility and timing
simplify
*
Effect on Government's use of more current technology
The following summaries highlight the efforts of each team to take
a broad look at the Government's information technology problems.
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SUMMARY OF THE HUMAN RESOURCES TEAM REPORT
1. Team Objective
The Human Resources Team addressed the ways in which computers and
information technology may be brought to support the Federal Government
in its attempts to cope with the delivery of human services in complex
and rapidly changing environments. The team examined decision-making
processes with the Departments of Labor, Housing and Urban Development,
and Health, Education, and welfare as well as the Veterans Administra-
tion.
Robbin R. Hough (Team Leader)
Oakland University
J. Gary Augustson
Department of the Treasury
John M. Daugherty
U. S. Army
Gerald T. Hedlund
General Foods Corporation
Peter B. Henault
Seattle City Light
David Hirschberg
Department of Cmmmerce
3. What the Team Did
The Team reviewed numerous reports dealing with the human resources
agencies to identify specific tasks and "targets of opportunity" for
follow up during the course of the study. The team (1) interviewed too
management officials in the human resources agencies of the Federal
Government on the major issues; (2) identified insights into the
investment, planning, and budgeting processes through joint "case study"
briefings by programs and information processing managers, and
interviewed key individuals in non-Federal organizations; and (3)
mailed 530 questionnaires to organizations involved with the delivery
of human services to identify broader views of the applications of
information technology.
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4. Introduction to Findings
The problems addressed by the Human Resources Team are not
strictly problems of information technology and computer management.
Rather they are an integral part of a broader pattern of management
failure.
If the Government is truly established to serve the people, then
the President must set goals with an eye to 'what ought to be' by
discerning the concerns of the American public. By capturing the
imagination and support of the public, these goals can then be
achieved. The Human Resources Team of the President's Federal Data
Processing Reorganization Project has concluded that the President's
power to serve is blocked today by a breakdown of policy management
systems and lost opportunities to use information technology. We see
the President surrounded and influenced by several hard-to-identify
layers of career bureaucrats that almost religiously believe progress
can only occur through an endless ritual with "the Hill." Programs,
rather than being measured by criteria and judged by performance,
must undergo a "political evaluation process" in which information
is the medium of rhetorical exchange.
The team developed a series of recommendations which can lead
to both a substantial improvement in the delivery of human services
and to a restoration of camnunication between the President and the
people. Implementation of these recommendations can facilitate the
president's ability to serve effectively and goals once again can be
set and achieved with a concern for what 'ought to be.' This
document summarizes some of the team's findings and outlines its
recanmendations.
"Very little is known about the impact of Federal
programs on some of their intended beneficiaries.
Few departments or agencies have any systematic
effective means of monitoring and evaluating the
programs which they are suppose to administer."
Pablo Eisenberg, President
Center for Community Change
Planning, coordination, and accountability became idle
concepts without a means for monitoring and evaluating program
performance. Where performance of program managers cannot be
tied to program results, it is impossible to develop positive
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incentives for good management. To survive where performance
cannot be measured, where a track record cannot be demonstrated,
managers must resort to turf fighting, empire building, and
caution.
These conditions were found to be all too typical among the
human resource agencies of the Federal Government. We found agency
heads are not really in charge of their agencies. Peter Drucker
summed it up well when he said, "Modern government has became
ungovernable. There is no government today that can still claim
control of its bureaucracy and of its various agencies."
At a time when the informed use of information technology
can lend so much to turning this condition around, it is instead
being largely unused because of several management-related
problems. Management ignorance about the potential of information
technology, lack of performance measurement, poor planning,
inadequate training, and a lengthy procurement process only begin
a long list of all-too-cammon characteristics which are unneces-
sarily stifling the human resource agencies.
The team divided these management problems into four
categories:
(2) Lack of incentives for innovation in information
technology
(4) Lack of action by the Office of Management and Budget
(OMB) on excellent recommendations
Each of these areas is developed in detail within the body
of the team report.
B. Human Service Delivery
The impact of these managerial deficiencies has been
particularly severe on the delivery of human services by the
Federal Government.
Where information technology could dramatically be improving
the delivery of human services at all levels (determining eligi-
bility, measuring performance, compiling data, showing trends,
assisting appeals, etc.), the Federal Government is still
attempting to conduct these programs with the tools and resources
of the 1960's.
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In spite of this lack of Federal leadership in applying new
technologies to the delivery of human services, several
farsighted State agencies and local governments are well ahead
of their Federal counterparts in the development of systems
to improve service delivery.
The team found citizens complaints connected with the
Federal Government services to be characterized by red tape,
reporting burdens, failure to provide understandable informa-
tion, incompetent personnel interfacing with the public, and
other unacceptable conditions. In studying the relationship
between the Federal Government and those agencies which must
administer federally funded programs, the team found unclear
assignments of responsibility, inadequate definition of goals
and standards, lack of effective citizen involvement, uncoor-
dinated delivery of services and complicated and burdensome
requirements.
Using these preliminary findings, the team conducted
extensive interviews with State and local government agencies
and with non-Government organizations involved in human
services programs. Additionally, the team prepared and
distributed a survey to the health and social services
departments of every State and to most public interest groups
concerned with the Federal Government human service program.
The results of this survey have been compiled in the team
report and reveal a number of interesting findings upon which
many of the team's conclusions and recommendations are based.
The human resources agencies are locked in a managerial "Catch 22"
situation: Managers cannot manage because they do not have the infor-
mation necessary to do so; the information is not available because
the agencies have not been managed in a manner that permits it to be
developed. The Team has further concluded that to break this endless
dog-chasing-its-tail, energy-wasting feature of the human resource
agencies, action at the highest executive level is necessary.
No standard definitions exist for human service programs; goals
are not well defined; and objectives are unclear. In the absence of
clear, concise goals, standards and definitions, it has been impossible
to develop a canrron language for human service programs. With no common
language, meaningful dialogue has been impossible; information has
not been able to flaw.
With no clear understanding of goals and objectives, managers have
not been able to establish the criteria necessary to measure program
performance. With no criteria and no meaningful measurement of
performance, well founded policy decisions are impossible. The result
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is that programs do not work the way they are intended. Technicians,
program managers, policy makers, everyone can identify some of the
causes but few in authority have an overall view of the causes or are
willing to take the action necessary to implement the top-to-bottom
changes which are required.
Specific conclusions are highlighted below:
A. The lack of adequate training programs to keep information
technology managers current with the state-of-the-art lead
to obsolescence of the individual, and eventually to
obsolescence of the organization.
B. Lack of visibility has been a major factor in the failure
to apply information technology to significant problems in
the administration of Federal programs.
C. Failure to understand the full potential of information
technology is a major barrier to more effective use of
information technology in carrying out agency missions.
D. The attitudes of agency managers are generally not conducive
to innovative use of information technology.
E. There is no effective means to link improvements in program
performance to information technology, and therefore there
is no incentive to pursue information technology innovations.
F. The proper environmental incentives and motivations for the
innovative use of information technology do not exist within
the human resource agencies.
G. Current Federal information technology procurement processes
provide a negative incentive for the effective use of
information technology.
H. Unpredictable legislative actions provide negative incentives
for the effective use of information technology.
I. The lack of effective communications between Federal, State,
and local officials prevents the transfer of technology
from one environment to another.
J. Federal human resource information technology investments
are not responding to needs. Substantial changes in the
Federal information technology investment philosophy are
needed to have the Federal Government achieve a level of
investment which is consistent with agency mission and the
private sector.
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K. It is now feasible and desirable to decentralize the manage-
ment of the human service delivery programs.
Program (line) managers should be held accountable for the
acquisition and implementation of major information technology
systems affecting their areas of responsibility.
M. For those reports which have already been submitted to the
OMB, that agency should immediately begin to review and
implement the significant recanmendations.
N. The Executive Office of the President should begin to assume
a more active positive management role in the Executive
Branch.
7. Recamnendations
The Human Resources Team firmly believes that information tech-
nology is the single most important key to coping with today's
knowledge industry and the canplex, overlapping, interrelated colicies
and programs of the Federal Government, but good management must be
the first step. Twelve specific reccamnendations have been developed.
The team has three broad policy recamnendations:
A. Stop Studying the Problem
Many recent studies have been conducted which resulted in
excellent and worthwhile recamnendations. Too many of these
recommendations have died on bureaucratic shelves while new
administrators have initiated new studies resulting in many
of the same recamnendations which also die on the same
bureaucratic shelves. The problems have been studied enough.
There are sufficient numbers of conclusions and recammenda-
tions upon which there is agreement, and we recommend that
action be taken now.
Any set of solutions to the problems confronting the human
resources programs should be implemented in a systematic
manner and given ample time to develop and bear fruit. We
specifically recammend against the tendency to choose
recommendations that are easy to implement and have a high
visibility while at the same time ignoring the wore
difficult, longer payoffs, and least cost-justified actions.
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C. Develop :'Mechanisms for Using Canon Sense in Government
The team recommends that formal action be taken by a central
agency to stimulate the use of more caoson sense in
Government. A small number of individuals with demonstrated
creativity, initiative, and desire to see their Government
be both effective and efficient should work full-time to
develop practical, no-cost cannon-sense actions which could
be implemented immediately by Executive order or agency
operating instruction.
These broad recommendations are supported by four specific
recommendations to improve management practices and information
quality throughout the Federal Government.
Recommended is.the issuance of an Executive order which
imposes new performance and status reporting requirements on
the Federal agency responsible for each human service delivery
program. The purpose of the new report is to ensure the
continual monitoring of the Federal Government's interaction
with the American people. The information provided by the
agencies should bear on two objectives:
o The timely, adequate, and accurate processing of
claims and applications; and
o Appropriate, adequate, and consistent program coverage.
E. Establish a President's Council on Information Quality
The President should immediately establish a "Council on
Information Quality" within the executive branch to provide
,clear, top-level focus on the quality of information and
information management in the Federal Government.
The role of this Council should be to reccnmend,- oversee, an
facilitate (rather than administer and manage) the inform-
F. Establish the Position of Assistant to the Secretary for
Information Quality
The President should establish an Office of Assistant to the
Secretary for Information Quality within each of the human
resources departments. The functions of this position would
be to act as a senior technical advisor to the Secretary on
his staff, thereby providing a clear, top-level focus on
information management in these departments.
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These advisors should be senior automatic data processing
(ADP) managers with broad experience who can advise in the
management of programs' information resources, consult on
the availability of alternative technologies, and maintain
open ca,ununication between the agencies and other organiza-
tions.
G. Establish a Technical Support Consulting Service
A technical support consulting service should be established
within a central agency to provide information, assistance
and advice to agencies implementing new technologies.
These management recommendations are followed by five specific
recommendations dealing with the delivery of human services. Three
of these deal with new policy direction; the remaining two involve
specific Executive actions which could be taken immediately and which
the team believes would have been substantial and highly visible
benefits to individuals applying for human services.
H. Adopt a Policy Aimed at Encouraging Consolidation and
Decentralization of Human Service Delivery
(1) Establish a policy initiative and timetable for the
consolidation of human resource programs under a single
automated integated eligibility determination system;
(2) Establish a policy initiative and timetable for
decentralizing service delivery of the human resource
programs; and
(3) Establish guidelines for the administration of the
Federal human resource program in accordance with the
"Policy Management Initiative."
I. Take Action to Establish Clear, Concise Goals, Standards and
Definitions as Normal Policy
Another major policy direction demanding immediate attention
is that of goals, standards, and definitions. A high priority
should be given to improvements in this area. Goals should
be stated clearly and concisely and should be maintained
as focal ;mints for each human service program. Uniform
standards and definitions, clearly stated, should be a follow-
up requisite.
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J. Encourage a Policy of Strengthened Partnerships with States
and Local Governments
As a final specific policy direction, action should be taken
to greatly strengthen the partnership between the Federal
Government and the State and local governments.
This partnership,-in terms of funding assistance, is already
strong. The team recommends that the emphasis for stronger
partnership focus on communications with the State and local
governments, greater trust in these governments to administer
federally funded programs, and a greater willingness to learn
from the initiative and innovation demonstrated by these
governments.
K. Establish a White House Task Force on Integrated, Automated,
Eligibility Determination
The President should immediately establish a task force to:
(1) Develop a single, common application for the principal
human resource programs of the Federal Government;
(2) Develop a prototype eligibility determination system
using computer technology; and
Develop recommendations by which the Federal Government
can encourage and assist State and local governments
in implementing automated client eligibility
determination.
L. Take Action to Automate Black Lung Eligibility Determination
Immediate action can be taken to reduce the time required to
process Black Lung claims. Recent revisions of the Federal
Coal Mine Health and Safety Act of 1969 provided for the
review of 150,000 claimants who had previously been denied
benefits. The plan the team has outlined -would take
advantage of existing computer technologies to significantly
assist in clearing up the current backlog. Currently,
approximately 300 days are required for a claimant to receive
an initial determination on his/'her claim.
Each of these recamnendations is discussed in the team report.
While some recommendations stand alone, the collection should be
viewed as an integrated package which has as its objective the use of
presently available computer technology to improve the policymaking,
administration, management and service delivery functions of the
Federal Government, while providing a mechanism for continued evalua-
tion of new technologies and direction.
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it is cur firm conviction that implementing bits and pieces of
these recommendations in the traditional "Band Aid" approach will
guarantee that the team's recammendations and work will prove fruit-
less. Only by implementating a complete and integrated package,
whether it be the package we have proposed here or some alternative,
and giving the package adequate time to develop, can meaningful,
lasting solutions be expected to happen.
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SUMMARY OF THE NATIONAL SECURITY TEPM REPORT
1. Team Objective
The National Security Team was charged with examining the manage-
ment of information technology in the Department of Defense (DOD). The
Team studied the decision-making processes to determine the linkages
between mission requirements and management of information technology
resources in the Army, the Navy (including the Marine Corps), and the
Air Force. Smaller agencies, such as the Defense Logistics Agency
and the Defense Communications Agency were not studied because of lack
of time. Both general purpose (administrative) and tactical computing
were studied.
E. L. Dreeman (Team Leader)
The Coca-Cola Canpany
G. Buck Fernandez
National Aeronautics and Space Administration
T. Pat Gorman
The Franklin Institute
James F. May
CBS, Inc.
Richard Werling
Department of Agriculture
3. What the Team Did
The six members of the team divided into three groups, each of
which examined in-depth the management and role of information
technology in one of the three services. During the course of the
study the team interviewed more than 500 users and suppliers of data
processing within the services. The individuals interviewed ranged
fray a plebe at West Point to the Deputy Secretary of Defense - and
extended fran San Diego, CA, to Fort Bragg, NC, and fran Boston, MA,
to Eglin AFB, FL.
4. Findings
A. The role of information technology in national security is
pervasive throughout every area of the Defense establishment.
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D. Once in the forefront of cauting technology, today Defense is
operating thousands of obsolescent computers and forfeiting
savings that are available fran newer equipment and technology.
The average age is six years greater than the comparable equipment
used in the private sector. Defense Department specialists almost
universally view this condition as beyond their control, and
attribute it to the chaotic regulations administered by the General
Services Administration (GSA) and the Office of Management and
Budget (CMB).
E. Career specialists express severe dissatisfaction with training
and career development opportunities. Due to the resulting heavy
attrition and, paradoxically, technical obsolescence among key
personnel, there is a very serious waste of human resources which
has aninous long-term consequences.
F. Relations with Congress have become strained when instances of
slippages or failures in major automatic data processing (ADP)
systems occur.
The Defense Department cannot fly a modern airplane, drive a
ship, issue paychecks, assign an officer, or issue an item from
inventory without using its computing resource. In a future
conflict, intelligent computer management could have a major
impact on the success of the national defense, and would extend
far beyond the purely military areas.
The canputer resource is not managed as an entity within the
services. In addition to dispersion within each service,
separate policy structures exist for general purpose computing
and for canputer resources embedded in weapons systems. In large
measure, this separation stems fran the special management
requirements placed on general purpose computers by public law.
Taken as a whole, the computer resource is an incredibly costly
item, and the total cost is only beginning to be identified.
Estimates can be developed which approach $10 billion, in
operating expense and acquisition costs, annually within the
Department of Defense.
G. Each of the military services has experienced some difficulty in
organizing and managing in ways which support optimal use of
computing resourses.
5. Conclusions
It is apparent to the study team that the combination of
circumstances described above has created a range of serious manage-
ment problems which require extensive attention to ensure that the
effectiveness of Defense computer support is returned to the highest
practical level.
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6. Recommendations
A. We strongly urge that top level DOD management, both civilian and
military, involve itself in the beginnings of an orderly resolution
of the current computer resource dilemma.
s B. Improve the effectiveness of the Department of Defense by eleva-
ting overall information technology staff within the OSD
organization. An OSD-level executive should be charged immediately
with overseeing the entire spectrum of use of the information
technology program, including those applications supporting admin-
istrative, scientific and engineering, command and control, and
operations functions. It is visualized that this office will play
a staff and policy role, and will not be an operational management
function trying to control day-to-day operations.
The office should evolve from the combination of the organizations
that are now responsible for managing portions of the information
technology function within DOD.
Assign to this office responsibiltity.for meeting, requirements for
"Earned Autonomy" that are recommended to bring to bear on the
objectives of the Brooks Law the resources of the Department of
Defense. (See the report of the operational management Team of
the Federal Data Processing Reorganization Project for details
on the "Earned Autonomy" concept.)
C. This step should be complemented by consistent and related actions
on the part of each Military Service. Equally important, initia-
tives being pursued by Defense information technology managers
in such areas as life-cycle management, career development and
training, long-range planning, Congressional relations, and
budgeting and cost accounting, should be promptly implemented.
D. -Establish well-defined career fields for both military and
civilian information technology specialist personnel, which will
allow progression into high-level (and eventually into top)
management positions.
E. Simplify and streamline approval and acquisition procedures, both
within the DOD and as practiced by the central agencies, to
permit more expeditious introduction of new systems. Lowest total
overall cost, measured over the complete system life cycle, for
the Department should be clearly stated as the goal of these
simplified procedures.
F. Develop and implement an accounting system which will provide
visibility into all automation costs, and implement a "charge-back"
system to give the user control over his automation expenditures.
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G. Adopt and enforce the life-cycle management policies, now being
issued, which implement CMB Circular A-109 policies in the area
of administrative data processing. In particular the points of
policy on stabilization of military tours of duty and of
lengthening tours of duty should be adopted.
H. Strengthen the capability and role of the Defense Audit Service
in reviewing ADP projects and requests.
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SUMMARY OF THE SMALL USERS TEAM REPORT`
The Small Users Team was charged with studying the issues relating
to the planning, management, and utilization of information technology
among the relatively small users of that technology. For the study,
this was defined as those agencies which reported automatic data
processing (ADP) obligations of less the $10,000,000. There were 27
such agencies. Among others, they included the Federal Trade Commis-
sion, the National Labor Relations Board, ACTION, and the Securities
and Exchange Commission. For a complete list see the Small Users Team
Report.
Herbert B. Pier (Team Leader)
Allstate Insurance Companies
Donald Cohen
ACTION
William S. Kirby
National Science Foundation
John Yankoviak
Department of Defense
3. What the Team Did
Fran the 27 agencies assigned, a representative sample of 10
agencies was selected to be examined in depth. Among the factors used
to select the sample were size, purpose, whether the agency operated
its own computer, and size of the information processing budget.
The agencies selected were:
A. Nuclear Regulatory Commission
B. Consumer Products Safety Commission
C. Small Business Administration
D. Federal Trade Commission
E. Interstate Cammerce Commission
F. Securities and Exchange Commission
G. Civil Aeronautics Board
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H. Federal Bane Loan Bank Board -.
J. International Communications Agency (formerly USIA)
The initial step was to gather and examine certain documented
information about each of the 10 agencies in the sample. Each
agency provided detailed organization charts, descriptions of major
computer installations and facilities, descriptions of all major
information technology applications, identification of primary users
of computer services, and examples of representative reports of
major computer applications.
After the documentation was examined, the Small Users Team
conducted in-depth interviews with key managers within each agency.
These managers included top-level agency management, information
processing management, administrative department management and
programmatic or mission department management. The interviews
centered upon the interviewee's experience, involvement and respon-
sibilities relative to information technology in the agency. The
topics covered in the interviews included the agency's organization
for information technology, the planning and budgeting processes,
the investment decision process, the use of information technology,
the effectiveness and satisfaction of applications, and possible
new applications of the technology. The data gathered were examined
and various options were analyzed. This analysis led to the develop-
ment of recommendations. Finally, the Small Users Team prepared
a report of the effort on the project.
4. Findings
A. Overall, data processing performance leaves much to be desired,
with agency top management primarily responsible for the condi-
tion. Agency management generally has not provided the necessary
support, attention, direction, and interest to the proper
application of information technology.
B. Information technology is not being used anywhere near its
potential in the mission (programmatic) needs of the agencies.
C. Computer equipment and resources appear to be lagging behind
the current state-of-the art-particularly when compared to the
private sector.
D. There exists a good deal of overlapping and duplication of work
in the installation of closely related data processing systems
among the small user agencies.
E. The field activities of small agencies are generally void of 4
information technology resources.
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F. There is no single, effective authority and source of information
technology expertise within the Federal Government which can
provide help, direction, support, and guidance to small user
agencies.
A. Establish a central unit within the Federal Government which
would provide a central, consistent source of support, advice,
and direction on any and all aspects of information technology
to any agency in need of them.
B. Require that the information processing unit of each agency
submit both short- and long-range plans for canputer resources
that are integrated with their agencies short- and long-range
goals.
C. Have the information processing unit report to a very high,
major decision-making level in each agency.
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SUMMARY OF THE GENERAL GOVERNIMENI' TEAM REPORT
The General Government Team examined the management and role of
information technology within the Departments of Justice and the
Treasury. The team focused on three main issues: (1) Now can the
process for planning, reviewing, and approving investment decisions
relative to the management of information resources be improved?
(2) What can be done to expand and upgrade the availability of
assistance in the area of information resource management? and (3)
What can be done to clarify and strengthen the oversight role at the
central executive and department levels for the management and
utilization of information resources in the Federal agencies?
John J. Stucker (Team Leader)
University of South Carolina
Todd R. Balfanz
Aetna Life and Casualty Insurance Company
Robert E. Hammond
Veterans' Administration
Felix Rausch
Federal Communications Commission
3. What the Team Did
After acquiring and reviewing background information on the two
departments being studied, the team interviewed 50 individuals to
elicit views concerning the issues being studied. The interviews
covered top-level agency management, operating program managers, and
agency-wide administrative support groups. Based on the results of
the interviews the team analyzed the data and developed alternatives
and options related to the issues under study.
4. Findings
A. The Congress, the President, and top-level administration appoint-
ees do not effectively translate political goals and priorities
into mission responsibilities of agencies and departments so that
information technology requirements can be adequately specified.
B. The management style of high-level career managers is reactive in
dealing with information resource decision-making.
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C. Users are not exercising their proper responsibility with respect
to information technology.
D. .There is an inadequate linkage between information processing and
telecamnunications in terms of long-range planning and systems
design and development.
E. The goals of the Brooks Law have not been achieved with the result
that Congress has lost confidence in the executive branch's ability
to manage information technology; this, in turn, has led to a
11 canmittee of the whole" environment surrounding the management and
control of information resources in the executive branch.
F. Management assistance and technical assistance for the use of
information technology is inadequate in the Federal Government.
5. Conclusions
A. The President, in conjunction with the Attorney General and the
Secretary of the Treasury and in consultation with the Congress,
needs to resolve certain policy issues which make it difficult
for top-program management to define appropriate mission objectives
involving information resources.
B. The President needs to upgrade management capabilities in the
executive branch so that management criteria became at least as
important as budget criteria in agency planning and investment
decision-making processes.
C. Management assistance and technical assistance relative to infor-
mation technology needs to be made available on a much broader,
more standard scale to the agencies and departments, and this
assistance needs to be separated, operationally, from oversight
processes.
D. The President needs to implement more fully the goals of the
Brooks Law.
6. Recommendations
A. The President should place primary emphasis on management objec-
tives and criteria in developing central Government information
technology policy for the executive branch by:
(1) Redirecting the thrust of the office of Management and Budget
(CMB) to develop policies which strengthen top-program manage-
ment practices at the central agency and executive department
level;
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(2) Requiring that management policies be consistent and consoli-
dated with respect to information technology (in contrast to
the President's Reorganization Plan #1 approach which divided
data processing and telecommunications policy responsibilities
(3) Assuring adequate implementation of standards to protect the
confidentiality and security of personal, proprietary, and
fiscal data maintained by Federal agencies;
(4) Directing that new program management policy emphasis for
(5) Allowing CMB to organize and adjust staffing so that it can
pursue consistent and positive oversight of the information
technology management policies it formulates instead of main-
taining control through simple disapproval of budget requests.
B. The President should designate OMB as the instrument to improve
the management of information technology at the agency level by:
(1) Requiring that life-cycle-management concepts be implemented
for information resources including time-phased development
of major new systems; planned obsolescence so that conversion
and upgrade costs can be better anticipated; and audit trails
implemented in all new systems to permit continuous assessment
of the system during the development, implementation, and
operating stages;
(2) Establishing related information technology planning/budgeting
and providing standards by which agencies can establish an
adequate mechanism which fully integrates mission and informa-
tion technology planning functions. The planning process must
precede and lead into the budgetary process and drive that
process rather than vice versa. ZBB, with its multi-year cycle,
should be fully implemented based on the principle that each
major system application becomes one decision package for top
management review and assesment. This reform of'the budget
process should be accompanied by the implementation of full
cost accounting and charge back procedures for information
technology resources and services;
(3) Highlighting the role of users for defining their information
requirements and for directing the system design, development,
implementation, and audit activities; requiring them to submit
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their development proposals through a top-program management
steering committee (adequately staffed) which determines
priorities for application of information resources;
(4) Providing standards for utilization reviews by top-level program
management through implementation of periodic audit and evalua-
tion of information technology. Based on these reviews top
program management should direct user groups to make changes
necessary to improve the efficiency and effectiveness with which
they utilize the technology. Agencies should be encouraged to
establish outside advisory committees to deal with information
resource management problems;
(5) Assuring that the departments adequately define agency mission
responsibilities. Advisory committees should be required which
not only review system planning and development proposals but
which also assist in clarifying and defining the policy/program
issues which arise relative to the use of information technology;
(6) Assuring that the departments provide adequate coordination in
planning and budgeting for information technology to minimize
duplication of systems and resources.
C. Central agency assistance for program management and technical
personnel should be expanded within the executive branch and given
far greater prominence by:
(1) Creating a central assistance organization to give this function
maximum visibility and standardization. This organization could
provide certain assistance services to the agencies and also
serve as a clearinghouse for information on assistance available
fran the private sector and from Government-wide centers of
expertise. This organization should not provide operating
services to agencies, nor should it be linked directly to policy
and oversight organizations although it would operate in support
of these groups; and
(2) Strengthening the assistance function for routine services at
the departmental level and in those agencies large enough to
justify an assistance staff, and ensuring that it is organized
separately from policy and oversight groups.
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SUM. OF THE SCIENCE AND TECHNOLOGY TEAM REPOKP
1. Team Objective
The Science and Technology Team was formed to study the role of
information technology in those agencies having a strong scientific
and technology emphasis in their mission. The agencies include the
National Aeronautics and Space Administration, the Department of
Energy, the Department of Commerce, the Department of Transportation,
the National Science Foundation, and the Environmental Protection
Agency. The team placed a high priority on addressing program agency
management problems.
2. Team Members
Louis W. Haire (Team Leader)
Lockheed Corporation
Charles W. Cross
Department of the Navy
Jesse H. Poore, Jr.
Florida State University
3. What the Team Did
The team interviewed too officials within the agencies covered by
its charge. The officials interviewed included agency management,
senior policy officials and senior operating officials at a sample of
agency field offices as well as at headquarters offices. Topics
covered included problems in applying information technology, and the
management process for information resources. In addition, the team
examined two areas of special concern. These were the role of the
Federal Government in advancing computer technology and a review of
the growth, fragmentation, and proliferation of Federal scientific and
technical information systems and data bases.
A. Management officials throughout the Government do not recognize
data processing as a broadly based management resource, but instead
view it as a narrowly-based technical specialty.
B. Senior data processing operating officials were generally forced
into the inappropriate role of resolving interorganizational
priority conflicts and satisfying demands for services regardless
of resource constraints.
C. Senior data processing operating officials became primarily
hardware expeditors with little broad policy-making role. am
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D. Little or no camnonality of purpose or commitment was found
between data processing centers within an agency.
The Brooks Law is sound as a management concept. However,
its implementation by the Congressional review process and
by the central policy/monitoring/oversight agencies tend
to unduly prolong the acquisition process because of the
adversary relationships created and the defense mechanisms
generated.
F. The hardware acquisition cycle time is excessive.
G. Overall cost effectiveness is seldan considered as a
criterion in the investment process.
H. Current conversion policies do not represent true conversion
costs of converting programs fran one canputer to another.
I. The inability or reluctance to integrally consider capital
expenditures with operational expenditures automatically
leads to plant, people, and equipment obsolescence and to'
an ever-spiraling escalation of operating costs.
J. Technology obsolescence is a major cause of excessive
operating costs.
K. Computer support necessary for successful mission accom-
plishment is frequently out of phase with other program
segments, resulting in a negative impact on overall agency
effectiveness.
L. The Federal Government usage of current canputer technology
appears to have peaked between 1965 and 1968 and has
steadily declined since.
M. Government-owned contractor-operated facilities generally
represent more efficient and more technologically advanced
facilities than Government-owned, Government-operated
facilities.
O. The inventory turnover cycle is about 20 years and is
expected to lengthen.
P. The obsolescence of personnel skills may be even greater
than hardware obsolescence.
Q. The current pace of technology advancement is expected to
continue unabated.
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R. The econanic and strategic benefit of information
processing technology have not been fully achieved.
5. Conclusions
A. The management process for information technology resources
lacks focus.
C. Current management practices weaken the role of the Federal
Government in serving the public, defending the country, maintain-
ing a strong economy, and meeting its obligation to the taxpayers.
6. Recommendations
A. The President should appoint a senior policy official who would
be a consistent advocate of good management principles from
the Presidential level on down.
This recasmendation is premised on the assumption that the
pranotion of good management techniques is an on-going process
to be applied to every case, every time.
B. Provide a focal point for the many and varied computer-related
research and development efforts currently being funded, directly
or indirectly, by Government grants, contracts, awards, purchase
orders, and IR&D programs.
Impetus for the development of this focal point should cane
fran the Executive Office of the President, Office of Science
and Technology Policy (OFTP).
C. The procurement techniques embodied in OMB Circular A-109 (Phase
1-Definition Contracts; Phase 2-Design Contracts; Phase 3-
Construction Contracts), developed for acquiring advanced weapons
systems, should be adapted to acquisition of large scale develop-
ments involving computer technology.
D. A national policy on information management and dissemination,
including the need for basic research should be formulated.
We recommend that this leadership could best be forthcoming
from the Executive Office of the President, Office of Science
and Technology Policy.
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1. Team Objective
The objective of the Acquisition Team of the President's Federal
Data Processing Reorganization Study was to examine the adequacy of
the process for acquiring data processing resources in relation to
alternative sources of supply, duration of acquisition cycle, level of
competition, and implications of technological developments.
2. Team Members
Harris G. Reiche (Team Leader)
Department of Interior
*James H. Burrows
Department of the Air Force
Douglas A. Crone
General Services Administration
*William H. Hunter
Office of Federal Procurement Policy
Robert S. Johnson
Blue Cross of Massachusetts
Blasdel A. Reardon
ARMCO, Inc.
*Note: These individuals were recalled by their agency after the study
began and did not participate in the development of the Team report.
3. What the Team Did
The Acquisition Team reviewed the acquisition process from
several points of view by interviewing personnel from representative
agencies, from central policy, management, and control activities,
from various segments of the data processing industry, from State
governments and from large corporate users of data processing. The
personnel interviewed were from all levels of agency management. The
team analyzed the serious problems reported to them and found that
the reported problems were symptomatic of more deeply rooted problems.
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A. The Mechanics of the Acquisition Process
(1) The data processing procurement process is being used as a
tool for forcing better management practices on Federal
agencies.
(3) Congressidnal and central-agency controls and reviews have
led to a duplication of those controls by the program
agencies.
(4) The Office of Management and Budget (CMB) appeal process \
is infrequently used to resolve differences in procurement\
determinations between the General Services Administration
(GSA) and program agencies.
(5) Length of the acquisition process is considered by program
agencies as their major acquisition problem.
(6) Although the majority of agency procurement requests (APR's)
are processed through GSA in a reasonable period of time,
once a procurement gets halted, the delay often becomes
extended interminably.
(7) In more than 90 percent of the cases, GSA delegates procure-
ment authority back to the requesting agency.
(8) The parties involved in the procurement process agree that
the dollar threshold for automatic delegation of procurement
authority should be raised.
(9) Consolidation of individual agency procurements has not
proved effective.
(10) On the average, the cost of conducting fully competitive
procurements having a contract value of less than $300,000
is greater than the cost savings resulting from the
competition.
(11) Despite the increased control and review processes, there
has been no appreciable reduction in noncompetitive
procurements.
B. The Nature of the Responsibilities and Guidance
(1) Protracted delays in resolving data processing policy
disagreements have had a detrimental effect on the data
processing goods and services acquisition process.
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(2) Sane policy guidance is unclear to the point of having an
adverse effect on data processing goods and services
acquisition process.
(3) The written expression of data processing goods and services
acquisition guidance is poorly organized, difficult to
understand, and unnecessarily voluminous.
(1) Understanding of the acquisition process including controls,
techniques, and procedures is lacking.
(2) Central Agency staff levels to prescribe acquisition policy
and to conduct procurements are inadequate.
(3) Accountability for the success or failure of an individual
acquisition is impossible to ascertain.
(4) Within the program agencies, the planning which occurs prior
to the acquisition process is deficient.
D. The Financial Planning and Funding for Computer Resource
Acquisition.
(1) The budgetary process has been an ineffective approval
process for large data processing equipment acquisitions.
(2) The Government often pays more for canputer equipment than
the lowest overall systems life-cycle costs.
A. CMB and GSA have not fulfilled the roles envisioned for them
by P.L. 89-306.
B. OMB and GSA are inadequately staffed to fulfill the responsi-
bilities assigned to then by P.L. 89-306.
C. Expertise and management strength in the program agencies with
respect to canputer resource acquisition is deficient.
D. P.L. 89-306, as implemented, is not having the intended effect
on Federal data processing procurement.
E. The written acquisition guidance needs to be improved in content
and simplified in structure.
F. The patchwork and layering of controls and reviews have not
improved the acquisition process satisfactorily.
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G. The canputer acquisition process should be stabilized.
H. The Congresssional role in data processing procurement has become
awkward and confusing.
I. The lack of cooperative relationships among Congress, OMB, GSA,
and the program agencies has contributed to the acquisition
problem.
J. Lack of accountability for the success or failure of acquiring
computing resources contributes to acquisition problems.
K. The basic acquisition process for major systems is not inherently
too lengthy.'
L. Changes to fiscal procedures would remove much of the wasted
effort and save millions of dollars in acquisition actions.
6. Recommendations
A. Policy and Management Responsibilities
Aggressive action should be taken under currently legislated
authorities to clarify specific responsibilities between
Present policies and procedures should be simplified and
ambiguities clarified.
(1) Formal education and training curricula should be developed
and incorporated into the Federal Acquisition Institute.
(2) major acquisitions should be conducted only by data proces-
sing and contracting personnel who are specialized in the
computer acquisition function.
(3) Additional staffing should be provided CMB and GSA.
D. Procurement Authority
(1) More formalized procedures should be adopted when delays are
imposed during the acquisition process.
(2) Delegations of procurement authority should be automatic to
those agencies that have been certified by GSA as qualified
to conduct effective procurements.
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(3) Agencies should be authorized to procure automatic data
processing equipment below $300,000 systems life cost,
without a specific delegation of,procurenent authority
and under simplified procurement procedures.
Proposed acquisitions with a price over $1 million should be
specifically identified in an attachment to Exhibit 43A of the
budget submission.
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SUMMAPI OF THE OPERATIONAL MANAGEMENT TEAM REPORT
1. Team Objective
The main objective of the Operational Management Study Team effort
was to improve the performance and productivity of automatic data
processing (ADP) operations in the federal goverrnaent through more
efficent and effective management. Specifically, the study was aimed
at improving:
* The utilization of ADP technology in operational support of
agency mission and goals;
* The management of ADP hardware and software resources; and
* The implementation of policy goals in the areas of
confidentiality and security.
2. Team Members
Philip J. Kiviat (Team Leader)
Department of the Air Force
(Joined SEI Canputer Services on July 31, 1978)
Jerry R. Berry
Tenneco, Inc.
Thomas Giacomo
Department of Health, Education, and Welfare
Donald A. Marchand
University of South Carolina
3. What the Team Did
The Operational Management Study Team sought substantial involve-
ment with affected Federal agencies as well as input from the Congress
and executive branch central management organizations (Office of
Management and Budget (OMB), National Bureau of Standards (NBS),
General Services Administration (GSA) in its efforts to define the
"Operational Management Problem" more precisely and to develop reccm-
mendations. Participation of private sector organizations and
associations was also sought, and materials concerning ADP management
policies, procedures and practices in use in the private sector were
reviewed.
The findings, conclusions, and recamnendations of the study team
were in seven distinct areas:
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* Systems Development
* Software Sharing
* Cost Accounting, Allocation and Control
* Installation Management
* Evaluation and Auditing
* Confidentiality and Security
4. Findings
A. Systems Development
(1) many agencies do not use a formal (structured) approach for
the development of systems or project management.
(2) Systems assurance (quality control) activity in the systems
development process is the exception rather than the rule.
(3) There are many critical areas of ADP where standards and
guidelines should exist that have been totally ignored.
(4) There is no effective mechanism in the Federal Government
to assure adherence by executive agencies to policy and to
provide the checks and balances necessary to insure
achievement of agency ADP goals in a reasonable manner.
B. Software Sharing
(1) Software requirements differed from agency-to-agency because
of substantive differences in the way agencies implement
cCmTon policies, regulations, and procedures.
(2) Common software requires common decisions throughout the
functional requirements definition and systems design
phases of software development; without cane n decisions
the idea of carman software is more apparent than real.
(3) Significant sharing of minor software systems is taking
place in an informal manner below the attention level of
top management.
(4) The GSA Software Exchange Program is at present not
successful. Most people interviewed did not feel it ever
would, or could, be.
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C. Cost Accounting, Allocation, and Control
Lack of cost awareness in data processing-related decisions is a
Government-wide problem of major proportions. ',chile it was found
that the availability of at least reasonably accurate cost
information for computer services is a necessary prerequisite for
improvement, the team also concluded that fundamental changes were
also needed in the relevant agency decision-making processes. The
thrust of these changes seek to accomplish:
(1) Accountability in the user organization for the cost-effective
definition of requirements and the use of ADP services;
(2) Increased tcp-management reliance on "economic" measures of
overall performance in place of detailed and explicit controls
on specific resources; and
(3) Strong direct incentives (rewards) for improvement in economic
performance for both users and suppliers of ADP services.
The team's investigations into installation management supported
the general findings of the other areas and specifically
concluded that much greater emphasis must be placed on "service"
as the primary goal of agency data processing, and the use of
measured service as a management-control tool.
E. Evaluation and Audit
The teas examined how agencies assure that data processing applica-
tions conform to user objectives and requirements, and the extent
to which applications contain controls and audit points consistent
with good business practices. The major finding is that not enough
data processing evaluation and auditing is being done in the
Federal Government:
(1) In many agencies there are not enough internal auditors and
evaluators with data processing knowledge and training; and
(2) :Current resources for data processing evaluation and auditing
are relatively small in comparison to the magnitude of the
data processing systems.
(3) A better understanding must be developed in the Federal
Government about the role and value of computer evaluation
and auditing, as well as an allocation of more adequate
resources to establish competent and effective agency data-
processing evaluation and auditing groups.
A-36
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F. Confidentiality and Security
Implementation of confidentiality and security policies and
procedures is very inconsistent in the Federal Government.
Confidentiality and security awareness and concern has not been
fully integrated into the program, resource-allocation, and
decision-making processes of Federal agencies. Monitoring and
enforcement of confidentiality and security policies is
inadequate both at departmental and central management agency
levels. There must be a closer link between the development of
confidentiality and security policies in the Federal Government
and their implementation and evaluation.
The study identified nine distinct areas where agencies need
support fran technical specialists: Resource acquisition; system
development; installation management; information economics;
product evaluation; review and evaluation of technical studies;
development of standards and guidelines; data services; and
training.
The team concluded that: There are well identified and well
justified requirements for more technical assistance capability
within the Government than exists today; these services should be
provided to requesting agencies on a fully cost-reimbursable basis;
and present methods of providing support are inadequate.
Fran its investigations, the team arrived at several broad con-
clusions common to all aspects of operational management:
A. Users of data-processing services are not assigned appropriate
responsibilities regarding their use of data processing.
B. Neither the users nor the providers of data processing services
have sufficient technically qualified personnel to properly
perform their roles.
C. ADP policy directives are most often issued without considera-
tion of their operational implementability, and without auditable
criteria which would assure their meeting the intent of the policy.
D. The oversight and control relationships in the area of data
processing between the individual agencies and the central
agencies (OMB, GSA, et al.) are poorly constructed and often
counter-productive.
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The general conclusions led to the formulation of a general team
philosophy called "EARNED AUTONOMY," regarding the desirable balance
between agency autonomy and central control and direction. Earned
Autonomy stresses the strengthening of line agency management, as
opposed to more central oversight, with the explicit goal that ultimate
authority and responsibility rest with the agency itself. However, the
existing situation demonstrates that a mechanism must be put in place
to encourage this to happen.
The "Earned Autonomy" management concept involves a program which
certifies agency information technology competence in specific manage-
ment areas. The approach will give maximum autonomy (delegation of
procurement authority, little or no management review by OMB, etc.)
to agencies that have demonstrated good management capability in these
areas. Agencies with less than capable information technology
management ability would receive more oversight and budget review.
Agency re-evaluations (certifications) would be conducted on a regular
basis.
(1) Establish a quality control function (independent of infor-
mation processing) within each department, agency, or bureau
utilizing canputers, capable of validating that:
* Systems are capable of meeting the requirement for which
they are intended;
* Systems are certified as operational before implementation;
and
* Project-plans to develop or acquire the systems are
adequate and reasonable.
(2) Establish a policy which requires that all operating depa
ments, agencies, and bureaus develco or adopt a formal
systems development and project management methodology. The
minimum requirement these methodologies should contain are
specified in the team report.
(3) Provide a central Government awards program for managers who
demonstrate outstanding performance.
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designers, who determine functional requirements and
system specifications.
(1) Encourage and facilitate informal software sharing.
(3) Form application-oriented cannon interest groups to
identify candidate common-use systems, encourage
informal contacts, and distribute information.
support and maintenance. Abolish the present GSA
software exchange activity.
acquisition and/or development of application-oriented
cannon use software, as well as its continued technica
The team's principal recamrendations call for the management
of all large general-purpose data processing facilities as Data
Processing Cost Recovery Centers," for which the following
should be required:
(1) Full cost accounting,
(2) Full cost recovery by charges to users,
(3) Actual transfer of funds from users to service providers,
(4) Explicit treatment of capital funding as "loans" with
"interest" payments that involve actual funds transfers,
(5) Ccanpetition with the private sector for the supply
of data processing services,
(6) Special surcharges for "captive" applications to
discourage retention of in-house applications based
on noneconanic justifications, and
(7) Personal performance incentives based on "certification"
of competitive status.
(1) The 0MB institute a policy (with supporting guidelines)
requiring agencies to explicitly manage and control the
level of service provided to data center users, who
request and pay for the level(s) of service they need.
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(2) The OMB require the oeriodic audit of all data centers h
qualified data processing auditors.
(3) The OMB and Commerce fund the development of installation
management guidelines and standards; and develop mechanisms
for enforcing the application of those standards that are
defined.
E. Evaluation and Auditing
The team recommends that the OMB develop a policy that will:
(1) Require agencies to establish effective data processing
(2) Assign clear responsibilities for policy, standards, guide-
lines, training, and technical assistance in this area, and
allocate resources so that responsibilities can be carried
out; and
(3) Encourage and support the development of new data processing)
evaluation and audit tools and techniques.
(1) The President issue an Executive order defining his concern
about the effective development and implementation of
confidentiality, security, and data quality assurance policies
in the Federal Government.
(2) A data processing security policy be instituted in the Federal
Government requiring that agencies establish security programs
and reviews for all data processing applications, systems, and
installations.
(3) A data quality assurance colic, be instituted requiring that
agencies establish data quality assurance programs and reviews
for all data processing applications, systems, and services.
(4) The monitoring and evaluation capabilities of central manage-
ment agencies be upgraded in the areas of confidentiality,
security, and data quality assurance.
(5) Technical assistance concerning confidentiality, security,
and data quality assurance be provided to agencies.
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(1) Technical Assistance Centers (TAC's), that provide fully
cost-reimbursable technical services to Government agencies,
be established whenever a sufficient demand exists to support
the operation of a TAC under full-cost recovery procedures.
(2) TAC's be administered by host agencies that can, and are
willing to, support them, by GSA or by Camnerce.
(3) TAC's be managed and reviewed by their respective host
agencies, OMB, and the appropriate Congressional oversight
canmittees.
(4) That a federation of TAC's be established to create a
camnunity of data processing expertise within the Federal
Government, and to provide joint policy, procedures, and
planning for individual TAC's.
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276
SUMMARY OF THE STANDARDS TEAM REPOFT
1. Team Objective
The task of the Standards Team of the President's Federal Data
Processing Reorganization Project was to determine ways in which the
management and administration of the Federal Information Processing
Standards program can be improved to provide meaningful, timely
standards which can be effectively implemented and enforced, and
which lead to the fulfillment of well-defined and accepted goals.
Specifically, the team addressed the following objectives:
* How can the proper goals and objectives of the Federal
Information Processing Standards program be determined and
how should the Government anticipate the needed standards?
* How can the development of high priority standards be
expedited?
* How can the Government best coordinate the development of
computer and communications standards?
Paul Oliver (Team Leader)
Department of the Navy
Robert P. Blanc
Department of Camnerce
David C. Gurtner
Veterans' Administration
3. What the Team Did
The Standards Study Team identified issues and problems by
interviewing officials of the central management agencies involved in
the Federal Information Processing Standards (FIPS) program. Officials
were interviewed fran the Department of Camnerce/National Bureau of
Standards (NBS), General Services Administration (GSA), the Office of
Management and Budget (OMB), and the General Accounting Office. In
addition, the staff of the House Committee on Government Operations,
data processing executives in major user agencies, and representatives
of major information technology professional associations, trade
associations, and industry were interviewed. The team also solicited
inputs by mail fran the major canputer user associations and did an
extensive literature search of pertinent documents.
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The following represents the major findings and principal recom-
mendations resulting from this study.
4. Findings
The Team found:
A. A perception that the standards program lacks discernible
goals and objectives:
B. Insufficient management direction by the central agencies:
t C. Inadequate discrimination in the classificationof automatic data
processing standards; and
D. Potential for conflict between data processing and
telecommunication standards.
5. Conclusions
A. The confusion and disagreement over the nature, purpose, and
impact of information processing standards in the Federal
Government are widespread, and represent major causes of
the problems existing in the Information Processing Standards
program.
B. The standards enforcement roles of the Department of Commerce,
GSA, Q`B, and agencies are not clearly understood nor uniformly
agreed upon by all parties concerned.
C. Responsibility for the shortcomings in the Information Proces-
sing Standards program must be shared by all the participants
in the program.
D. The level of software sharing in the Federal Government is
minimal, if existing at all.
E. The problems existing in the Federal Information Processing
Standards program will tend to worsen with time.
A. That the Director of the Institute for Canputer Sciences and
Technology institute a program to anticipate, identify, and
prioritize information processing standards needed in the Federal
Government. We further recommend that this be done through the
creation of a Program Development Staff and a Standards Policy
Board.
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B. That schedules be established for needed standards, and that
the Institute for Canputer Science and Technology be prepared
to undertake the development of needed standards when such
standards are not forthcaning fran the voluntary standards
process.
C. That the Secretary of Commerce exercise the responsibility
and authority for determining and reporting canpliance with
information processing standards on the part of vendors,
departments, and agencies.
D. That the Institute for Canputer Sciences and Technology be
removed fran the National Bureau of Standards and that it be
placed directly under the Department of Camnerce Assistant
Secretary for Science and Technology.
E. That a Site Review Staff of consultants be established under
CMB auspices to assist CMB in carrying out its responsibili-
ties with regard to the implementation of standards.
F. That the Memorandum of Understanding between the National
Catununication System (NCS) and the National Bureau of Standards
(ICST) be updated to include a greater degree of joint planning
between NCS and the ICST.
G. That the OMB direct each department and agency to establish av
central Standards Management office, or equivalent, which would
be responsible for the management of a standard program within
that department or agency.
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SUMMARY OF THE PERSONNEL TEAM REPOFQ
The tasks of the Personnel Team of the President's Federal Data
Processing Reorganization Project were to assess significant problems,
research and evaluate current personnel practices, develop alterna-
tives, and make specific recamnendations designed to improve the
overall utilization and management of data processing personnel in
the Federal Government.
Specifically, the Personnel Team addressed these objectives:
A. The need to improve recruitment processes to eliminate
problems in hiring and retaining skilled people necessary
to assure effective utilization of technology.
B. The need to eliminate conflicts created by the growing
tendency of specialization in certain data processing jobs
and the desire to broaden individual skills to enhance
opportunities for promotion.
C. The need to incorporate data processing questions as an
integral part of agency decision-making and policy
setting processes.
D. The need to revise the present job classification system
to permit the Federal Government to make full use of new
tools and techniques which have and are being developed.
James B. McManama (Team Leader)
City of Dayton
A. Ray Demarest
U.S. Civil Service Canmission
Israel Feldman
Department of Housing and
Urban Development
Vincent C. Guidace
Air Force Data Services Center
David R. Skeen
Department of the Navy
Stephen J. Stofko
U. S. House of Representatives
Carol M. Vaughan
Bureau of the Census
3. What the Team Did
The team identified issues and problems through formal and
informal contacts with key management and operations personnel in
39 Federal agencies, 9 professional societies, 8 private firms, and
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3 labor organizations and through the thorough review of previous
studies dealing with Federal personnel, particularly the President's
Personnel Management Project Study Report released in December 1977.
The following represents the major findings and the principal
recommendations resulting from this study.
A. The ability of data processing personnel to contribute effec-
tively to the goals and objectives of Federal agencies is a direct
reflection of the top management's perception of information
technology's function and significance to the agencies mission.
The organizational placement of the function is also directly
related to this perception.
B. The nature of data processing work and the jobs being performed
are not adequately reflected in the standards by which positions
are classified, resulting in ineffective position management.
C. The mechanics of the examination and certification process
adversely impact the Government's ability to recruit and retain
skilled data processing personnel.
D. Neither training nor career-development programs are organized
or administered in a manner which would achieve the most effective
development of personnel or utilization of data processing
technology.
E. Personnel ceilings are restrictive, inhibit flexibility, and
establish barriers to adequate staffing.
F. Excessive use of contractual data processing support services
is fostered by existing Federal procurement policy and personnel
ceiling limitations.
G. Existing formal incentive systems are not properly set up or
utilized for rewarding/motivating personnel.
The team recommends and, in the detailed report, discusses
implementation methodologies which would:
A. Require Information Systems Training for functional managers
in Grades 14 and above.
B. Require that impact analyses be performed on data processing
operations before major policy or procedural changes are
implemented.
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C. Establish in-house mechanisms for setting data processing
priorities, and making policy decisions when conflicting demands
cannot be resolved at the operating level.
D. Assign responsibilities for information systems policy and
overall operations at the Deputy Assistant Secretary level or.
higher.
E. Establish a new occupational group, "Information Science,"
with appropriate job series to reflect the changed nature and
role of data processing in the Federal Government and changed
job specialities.
F. Modify existing legislation to allow delegation of examining
authority to the heads of agencies.
G. Make wore use of cooperative training and summer intern programs
with colleges and universities which offer computer sciences
curricula and degrees.
H. Establish communications lines between agencies and the Civil
Service Commission to vastly improve agency knowledge of the
recruiting and examining process.
Establish a Federal Data Processing Training and Career
Development Institute.
Modify the existing policy on personnel ceilings to allow more
management flexibility by applying monetary versus numerical
restrictions.
K. Publish clear guidelines on the types of data processing
projects and activities which have been proven to be.more
successfully accomplished by contracting cut.
L. Establish appropriate occupational series for, and provide
specialized training in preparation of, data processing-related
contracts and recuests for proposals, contract performance
monitoring, and contract administration.
M. Modify compensation legislation to allow incentive awards in
the form of "percentage of salary" bonuses.
N. Support long-term efforts leading to the development of
suitable criteria and methods for formal certification of data
processing professionals.
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The task of the Central Agencies Team was to address (1) the roles
and responsibilities of the central policy-making agencies (Office of
Management and Budget (CMB), General Services Administration (GSA),
and National Bureau of Standards (NBS)) and their relationships to
those of the user, agencies, (2) alternative organizational options for
fulfilling Federal data processing requirements, (3) specific areas
of central policy concern or opportunities for improvement which
are not being addressed, and (4) the nature of the future information
technology-and its potential impact on Government.
C. R. Hagener (Team Leader)
Weyerhaeuser Canpany
Alton P. Jensen
Georgia Institute of Technology
Joseph C. R. Licklider
Massachusetts Institute of Technology
L. J. Riley
U.S. Army
Mirco Snidero
National Oceanic and Atmospheric Administration
3. What the Team Did
The team scheduled and conducted briefings with various national
technology leaders; interviewed spokespersons for industry associations
and private companies; interviewed cabinet-level officials and others
within the central agencies and Government at large; reviewed Executive
orders within the central agencies and Government at large; reviewed
Executive orders, policy statements, records of hearings, and GPO
reports; and developed a consensus which is presented in their report.
4. Introduction to Findings
'A 1959 study by the Bureau of the Budget on Automatic Data
Processing Responsibilities directly anticipated some of the main con-
clusions of this study: The findings on the impact of ADP previously
reported herein indicate that dynamic leadership of the ADP program of
the Federal Government is a vital necessity. Passive, partial, or
informal types of leadership have had their place, but have now outworn
their usefulness."
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Information technology has prpgressed remarkably since 1959, but the
Government's management and use of it have not. Although an early
innovator and explorer of information technology, the Government began to
fall behind in its exploitation of that technology after the mid-1960s.
Now, in 1978, we find that the Bureau of the Budget (BOB) conclusion is as
valid today as it was when drawn. However, in the area of information
technology, leadership is lacking at critical levels in the Federal
Government. This lack 'of leadership is the root cause of a set of
conditions which has led to a progressive deterioration of the Government's
ability to exploit and benefit from information technology. This condition
must be corrected because:
* The Federal Government is heavily and irreversibly dependent upon
effective application of information technology.
* Effective application of information technology can be a major
force in the fight against inflation. It can increase productivity
and performance, improve the delivery of services to the citizenry,
and increase our nation's economic and military strength.
* The extraordinary pace of the development and confluence of
communications computer text processing and graphics-and-display
technologies is opening significant new opportunities for our
society and Nation.
We believe that the Government must nove quickly and positively to
regain its old spirit and enthusiasm. Lyndon Johnson wrote a memorandum
in 1966 that caught that spirit. It said: "The electronic computer is
having a greater impact on what the Government does and how it does it
than any other product of nadern technology. . . . Its potential for
good has been amply demonstrated, but it remains to be tapped in fuller
measure. I am determined that we take advantage of this technology
by using it imaginatively to accomplish worthwhile purposes." J
The challenge faced by the Federal Government is to recognize that
the issues set forth so clearly in the 1960s are the same today. The
problems have not changed, but the opportunities and economics of their
solutions through the use of information technology have changed, and
changed dramatically. In view of those changes, there is little excuse
for not exploiting information technology for the good of our society
in the future.
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The following have been selected from the full set of findings
in the body of the team report; they are sufficient to characterize
the situation as it exists today:
A. The capabilities, performance, cost-effectiveness, and range
of available information technology products continue to
increase. The capability of a dollar's worth of computer
hardware to store and process information has doubled
approximately every two years since 1943; this continuing
progression provides major opportunities to increase the
strength of the Nation and to improve the delivery of
services to its citizens.
/ The confluence of communications, computing, text processin
C. The Federal Government has not obtained the leadership from
CMB, GSA, and Commerce needed to employ current information
technology to sustain and improve its service delivery and
control its costs.
D. In the area of information technology, the central agencies-
CM, GSA, and Commerce (NTIA and ICST)-are diffused in
responsibilities and accountabilities and are inappropriately
focused on procurement control rather than on leadership and
service.
E. The Standards Program for information technology within the
Federal Government has not achieved the goals identified for
it in BOB Circular A-71 (Responsibilities for the Administra-
tion and Management of ADP Activities) and in P.L. 89-306
(the Brooks Law).
F. The nondefense sector of the Federal Government does not have
an adequate research and development effort in information
technology.
G. There is a misguided preoccupation with the fear that the
power of information technology will almost of necessity be
used perversely to infringe upon the rights of citizens; as
a result of this unjustified assumption, emphasis is being
placed on limiting the technology to prevent abuse and
identify anyone who tries to misuse these resources.
H. The power structure within OMB is heavily tilted to the
budget side. The management side is severely limited in
resources and rower.
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I. GSA, a4B, and Commerce are showing evidence of change and renewed
vitality. It is important to give all the "players" time to
adjust to the new environment, new appointments, and new issues
(e.g., E.O. 12046 establishing the National Telecommunications and
Information Administration). There is evidence of sound planning,
careful camnitments and increasing collaboration on the part of
a few principals who are willing to take the risks needed to obtain
improvements.
J. Agency executives do not view information technology as a resource
to be managed as other resources. Consequently, they are not
involved in investment decisions regarding this technology and are
leaving its management to technicians. Automation decisions are
not based on ability to increase productivity or improve
performance of overall agency missions.
K. The focus of existing policies and regulations governing informa-
tion technology is mainly on the acquisition process rather than
on the larger management issues of performance, productivity,
effectiveness, and efficiency.
L. Data processing management is viewed as a special form of
management. Consequently, program managers have little decision-
making authority in any area where data processing is involved.
The head of the largest Federal department, for example, can not
approve the purchase of a piece of data processing equipment whose
price exceeds $50,000.
M. The House Government Operations Cammittee staff is the de facto
manager of the acquisition of the Federal Government's
information technology resources in the absence of leadership
fran OM, GSA and Commerce.
(1) Introduce a positive, nurturing force for information
technology in the Federal Government to counteract the
essentially negative, adversary environment existing today.
Specifically:
* Establish a Special Assistant to the President-for
Information Technology Policy, Plans, and Programs (ITP)
to act as the senior advocate for information technology
within the administration and to be responsible for
foreseeing, understanding, and evaluating issues and for
setting national and Federal goals for that technology.
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* Establish an Grfice for Information Resource Management (IPM)
in CMB at the Executive Associate Director level. This
office should have all of the OMB's current information
technology responsibilities and authorities. The Executive
Associate Director for IRM should be charged specifically and
emphatically to generate and maintain a managerial cohesiveness
with the GSA and Canmerce and to foster the use of information
technology to increase governmental productivity.
* Establish an Information Resource Manager as an Assistant
to the head of each department or agency to provide a positive,
nurturing force promoting efficient and effective use of
information technology throughout the department or agency and
to serve as the link between the department or agency and the
Federal Information Technology Council (as prescribed below).
* Establish a Federal Information Technology Council with the
Special Assistant for ITP as Chairperson, the head of the
Office of IRM in C1B as co-chairperson, the IRMs of the
departments and agencies as members, and selected individuals
fran the legislative and judicial branches as observers.
This council is intended to be the main forum and workshop
for establishing overall Government goals, policies, and
directions in information technology.
(2) By building on existing institutions, fulfill the concept of
"Centers of Competence" in research, development and specialized
assistance to the departments and agencies. Develop two centers,
one to support the national security agencies including the
Department of Defense (DOD) and the intelligence community, and
another to support the civil agencies. This second center should
be combined with the Institute for Canputer Science and Tech-
nology, NBS in Canmerce, and be responsible for standards as well
as research, development, and specialized assistance. organiza-
tionally, this new center should be removed fran the National
Bureau of Standards (NBS) and report directly to the appropriate
Assistant Secretary in Commerce.
(3) Continue the direction established in E.O. 12046 and take action
to consolidate organizations dealing with the elements of informa-
tion technology -- communications, computers and information.
This will require some adjustments and/or realignments in GSA
and Commerce. CMB realignment should follow naturally from
the previous structural recommendations.
(1) Delegate rare responsibility to program agencies. Place
information technology decision-making responsibility in the
hands of the program-managers who have end item cost/performance
accountability. Give these managers authority to make "best buy"
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decisions between alternate sources of services, both in the
Government and the private sector, under the guidelines of full
competition and requirements of OMB Circular A-76. ;cold these
managers accountable for results.
(2) Use proven tools of management as a means of improving the
Government's use of information technology. Specifically:
* Require 5-year information technology plans that are coordinated
with budget plans and agency programs. Base decisions on a
proposal's ability to increase an agency's productivity,
performance, or responsiveness. Use these plans to identify
significant social/political issues early in the process.
* Concentrate on developing performance and productivity measures,
quality measures, and other measures of accountability. Tie
these directly into the multi-year, zero base budget process.
Provide for the monitoring of these measures and for their
review as part of the overall budget process, both at the agency
level and at the OMB level.
* Require that information technology costs flow directly into end
item (product or services) unit expense. Include all costs,
direct and/or indirect, including appropriate allocation of
long-term and capital costs. Place shared facilities on a full
charge-out basis.
* Evaluate facilities in terms of their unit costs of delivery
of services to the programs they support. Compare these costs
to comparable facilities in Government and in the private sector.
Improve or close Federal facilities which do not compare
favorably.
(3) Require periodic assessments of the cost-effectiveness of installed
information technology. Replace obsolete equipment that is no
longer reliable and cost-effective.
(1) Distinguish future-oriented policy making that has national and
internal implications from policy that is focused upon management
of ongoing Government operations and procurement of equipment
and systems to support such operations. The former should be
developed by the Special Assistant to the President; the latter
by the Executive Associate Director, IRM, OMB.
(2) Task C1MB and GSA to replace immediately the current set of archai
procedures, regulations, and policies relating to information
technology management and procurement with a rational, coherent
approach stressing:
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* Longer-range planning
* Agency accountability
* Productivity/performance measures
* Mission orientation
* System life cost benefit analyses
(3) Do not change P.L. 89-306, which continues to be a viable instrument
of policy; current difficulties have been caused by the malimple-
mentation process.
cost-benefit analyses to determine the expected value of standards
for meeting these objectives, fund and schedule their development,
and implement those that show high return on investment. Provide
a mechanism for enforcing these standards once established,
including rewards for adherence and sanctions against failur
technology facilities where appropriate, and develop and promulgate
a consistent method of identifying costs and collecting them back
(6) organize the handling of long-term information technology policy
issues under the Special Assistant to the President operating with
the aid of the Federal Information Technology Council. Long-term
policy issues that need more systematic or more vigorous treatment
are:
* Privacy
* Security
* Constraints on international flow of information
* Transfer of technology to the third world
* Transfer of technology to economic and military canpetitors
* Canpetition vs. monopoly, free enterprise vs. regulation
* Ccmpatibility in electronic message systems
* Canpatibility among "offices of the future"
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* "Canputerized camnerce"
* A Federal cammn-user information network
* A national cammn-user information network
* United States initiatives in international networking
(7) 'Develop an improved policy formulation process that incorporates:
broad involvement by those affected; feasibility and cost-
benefit analysis of the proposed policy; pilot testing before
pranulgation; Federal Information Technology Council concurrence;
periodic evaluation of policy effectiveness.
D. Research and Development
(1) Establish, fund, and staff a research and development program
in information technology for the nondefense sector of the
Federal Government. The program should range fran theoretical
and laboratory work to prototype testing. At a minimum, the
program should include:
* Advanced software techniques
* Archival storage technology
* Human factors analysis
* Privacy
* Security
* Robustness
(Robustness refers to the assurance of performance despite
malfunctions and to the reduction of vulnerability to
unintentional as well as intentional disruption of facilities.)
(2) Assign this research and development program as part of the
responsibilities under P.L. 89-306, via the Secretary of Camrerce,
to the Assistant Secretary for Science and Technology.
MINORITY POSITION
A difference of opinion occurred among members of this team regarding
the recanmendation to establish a Special Assistant to the President for
Information Technology Policy, Plans-and Programs. This difference was not
resolved and consequently a minority position (Chapter 10) and a rejoinder
(Chapter 11) was included.
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The minority recommendation is that the executive department's senior
information technology official be within the Office of Management and Budget
at the Executive Associate Director level. This Executive Associate Director
should be responsible for evaluating information technology issues, setting
Federal goals for information technology, fostering its use in the national
interest and maintaining a managerial cohesiveness with GSA and the Depart-
ment of Commerce. Additionally, this Executive Associate Director should
chair the proposed Federal Information Technology Council. Finally, this-
directorate should have all of OMB's current information technology author-
ities and responsibilities.
To fully implement this recommendation, the following modifications
to related recommendations are also required:
o Structural. The Federal Information Technology Council would
be chaired by the Executive Associate Director
for Information Policy, OMB.
o Policy. Both operational management policy and future-
oriented policy would be the responsibility of
the Executive Associate Director for Information
Policy, OMB.
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Chapter III: FEDERAL DATA PROCESSING REORGANIZATION
PROJECT STAFF
Project Management Grow
Walter W. Haase, Project Director; Deputy Associate Director for Informa-
tion Systems Policy, Office of Management and Budget;
Kenneth Allen, member of the Information Systems Policy Division of the
Office of Management and Budget;
Ronald C. Bonig, Management Analyst, Office of Management Policy and
Planning, Automated Data and Telecarnnunications Service, General
Services Administration;
Gerald F. Chappel, Assistant to the Director, Office of Canputer Services
and Telecarununications Management, Department of Energy;
Rob Cooper, staff member of the office of the Director of Data Autana-
tion, Office of the Secretary of Defense;
John P. McNicholas, Senior Policy Analyst, Office of Management and
Budget;
Roxanne Williams, Director, Plans and Policy Division, Office of Opera-
tions and Finance, US Department of Agriculture;
Human Resources Team
Robbin R. Hough, Team Leader; Professor of Econanics and Management,
Oakland University;
J. Gary Augustson, Chief, User Services, Office of Canputer Science,
Office of the Secretary, Department of the Treasury;
John M. Daugherty, Lt. Colonel, U.S. Army. Team chief for Army Major CamiarY
Systems, Automation Directorate, Office of the Army Chief of Staff;
Gerald T. Hedlund, General Foods., Inc., Manager, EDP Operations and Systems
Support for corporate data center;
Peter B. Henault, Director of Environmental Affairs, Seattle Department of
Lighting;
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National Security Team
E. L. Dreeman, Team Leader; Director, Corporate Information Services,
The Coca-Cola Canpany;
Dave Brandin, Director of International Program Development-Information
Service and Engineering at SRI International;
G. Buck Fernandez, NASA, Acting Assistant Director of Information Systems;
T. Pat Gorman, Principal Scientist (Computer Science), Franklin Institute
Research Laboratories;
James F. May, Director, MIS Planning, CBS;
Richard Werling, Deputy Director, Budget Division, Agricultural Stabiliza-
tion and Conservation Service;
Herbert B. Pier, Team Leader; Director, Corporate and Organization Planning
at Allstate, Insurance Companies;
Donald Cohen, Chief, Advanced Accounting Systems Staff, ACTION;
William S. Kirby, Contract Specialist, National Science Foundation;
John Yankoviak, Chief, Plans and Policy for the Defense Logistics Agency
ADP Program;
General Government Team
John J. Stucker, Team Leader; Director, Social and Behavioral Sciences
Laboratory, and Associate Professor of Political Science, University of
South Carolina;
Todd R. Balfanz, Director, Aetna Life and Casualty;
Robert E. Hammond, Staff Auditor, Office of the Inspector General, Veterans-
Administration;
Felix Rausch, Branch Chief, Data Automation, FCC;
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Science and Technology Team
Louis W. Haire, Team Leader; Corporate Director, Computer and Ccaununica-
tions Planning, Lockheed Corporation, Burbank, California.
Charles W. Cross, Head, Scientific, Engineering and Laboratory Programs,
Command, Control and Information Systems Division, OPNAV (Op 942);
Department of the Navy;
Jesse H. Poore, Jr., Director of the Computing Center and Associate
Professor of Mathematics, The Florida State University;
Harris G. Reiche, Team Leader; Director of ADP and Telecommunications
Management, Department of the Interior;
James H. Burrows, Associate Director, Data Automation, U. S. Air Force;
Douglas A. Crone, Director, ADP Procurement Division, Automated Data and
Telecommunications Service, General Services Administration;
William N. Hunter, Deputy Associate Administrator for Systems and Technology,
Office of Federal Procurement Policy.
Robert S. Johnson, Vice President, Data Processing, glue Cross of Massa-
chusetts.
Blasdel A. Reardon, Corporate Director, Data Processing, Armco Steel
Corporation, Middletown, Ohio;
Operational Management Team
Philip J. Kiviat, Team Leader; Technical Director, Federal Computer
Performance Evaluation and Simulation Center;
Jerry R. Berry, Manager, Standards and Planning, Corporate Information
Services, Tenneco, Inc.;
Thomas Giamnm, Director of Division of Statistical Processing, Social Securi,
Administration.
Donald A. Marchand, Associate Director, Bureau of Government Research and
Service, and Assistant Professor in Government and International Studies,
University of South Carolina;
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Standards Team
Paul Oliver, Team Leader; Director, Federal COBOL Compiler Testing Service,
Department of the Navy, and Professor of Computer Science at American
University.
Robert P. Blanc, Staff Assistant for Computer Utilization Programs in the
Institute for Computer Sciences and Technology of the National Bureau
of Standards;
David C. Gurtner, computer specialist, Department of Data Management,
U.S. Veterans Administration;
Personnel Team
James B. Mc4anama, Team Leader; Manager, Data Processing Center, City of
Dayton, Ohio;
A. Ray Demarest, Chief, Federal Personnel Systems Management Division,
Bureau of Personnel Management Information Systems, U.S. Civil Service
Commission;
Israel Feldman, Director of Reports Analysis and Statistical Operations
Division, Department of Housing and Urban Development; served as Chairman
of the Interagency Committee on ADP;
Vincent C. Guidace, Chief, Engineering and Personnel Systems Division,
Air Force Data Services Center;
David R. Skeen, Head, Computer Science Branch, Office of Civilian Personnel,
Department of the Navy;
Stephen J. Stofko, ADP Manager, U. S. House of Representatives, House
Information Systems;
Carol M. Vaughan, Chief, Training Branch, Systems Software Division,
Bureau of the Census, Department of Commerce.
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Central Agencies Team
Charles R. (Dick) Hagener, Team Leader; Corporate Systems Department Manager;
Alton P. (Pete) Jensen, Principal Research Engineer;
J. C. R. Licklider, Professor of Electrical Engineering and Canputer
Science at MIT;
L. J. Riley, Brig. General, U.S. Army. Deputy Commanding General, USA
Canputer Systems Ca*nmand;
Mirco Snidero, Director, Office of Management and Canputer Systems,
National Oceanic and Atmospheric Administration.
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APPENDIX D.-GENERAL ACCOUNTING OFFICE, LET-
TER FROM THE COMPTROLLER GENERAL WITH
ENCLOSURES (MAR. 3, 1980)
The Honorable Jack Brooks
Chairman, Subcommittee
on Legislation and National
Security
Committee on Government Operations
House of Representatives
You submitted several written questions to us during
our February 7, 1980, testimony on H.R. 6410, "The Paper-
work Reduction Act of 1980." Our responses to those
questions are provided in Enclosure I. You also requested
that we provide examples of our assessment of executive
agencies' performance in managing their information
resources and activities in relation to potential benefits
which might be achieved through implementation of H.R. 6410.
These examples are contained in Enclosure II.
Additionally, you asked that we comment on some of
the benefits which might reasonably be expected from
implementing H.R. 6410. Our thoughts on this matter are
outlined below.
We believe that the most important benefit from
implementation of H.R. 6410 will be improvements in Federal
information management. The need for such improvement is
well documented in congressional hearings, the work of
the Commission on Federal Paperwork, executive branch
studies such as the President's Federal Data Processing
Reorganization Project, and numerous GAO reports.
The significance of achieving improvements in Federal
information management activities in terms of dollar
expenditures can be readily seen by the Commission on
Federal Paperwork's estimate that Federal paperwork costs
more than $100 billion a year. This estimate included
both internal Federal Government costs and costs levied on
all segments of our society by Federal information require-
ments.
COMPTROLLER GENERAL OF THE UNITED STATES
WASHINGTON, D.C. 20548
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The Commission made no claim of great precision for
this estimate and none was necessary. The fact is that
our society has moved rapidly toward-becoming an "infor-
mation society". The Federal Government, because of its
involvement in so many aspects of our citizens' lives, has
become a major part of that information society. How well
or how poorly the Federal Government manages its infor-
mation activities, both internal and external, affects
every one of our citizens.
We believe that effective implementation of H.R. 6410
will provide the basis for long-term improvement in every
phase of Federal information management. It provides for
the first time the statutory authority, the responsibility,
and fixed accountability for Government-wide information
management in the Office of Management and Budget (OMB).
Some of the specific benefits in terms of management improve-
ments which H.R. 6410 should provide include:
--a single control point for Federal information
management policy and oversight;
--an end to fragmented responsibility for con-
trolling Federal paperwork burdens on the public;
--visible and accountable officials for information
management, both in OMB and in each agency;
--uniformity and consistency in policies for acquisition
and management of advanced information technology;
--much needed visibility, authority, and accountability
for statistical policy coordination and records
management; and
--development and implementation of a long-needed
Federal information locator system.
As I stated in my testimony, we believe that enactment
of H.R. 6410 will mark the beginning of the long and arduous
task to solve the many information management problems now
existing. Successful performance of that task should result
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in improved information management and reduced paperwork
burdens on the public fully justifying the relatively modest
incremental costs associated with the bill.
Sincerely yours,
Signed Elmer E. Staats
Comptroller General
of the United States
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299
ENCLOSURE I ENCLOSURE I
Questions for the Comptroller General
on H.R. 6410
Question 1. I gather that you're not happy with
the present information collection clearance structure,
in which GAO clears the requests of independent regulatory
agencies, OMB clears requests for most executive agencies,
and certain other agencies clear requests that fall into
specified areas, such as education. Could you go into
more detail in your criticism of this structure?
Answer. The fundamental problem with the present
structure is that it violates the basic management principle
of clear designation of lines of authority, responsibility,
and accountability. Simply stated, if you want to manage
something to achieve results, you don't set up three or
four different organizations with different guidelines to
do the job.
As I outlined in my testimony, presently there are
three agencies with one degree or another of "central"
clearance authority for Federal information collection--
OMB, GAO, and HEW. In reality, two additional organizations,
the IRS because of its exemption from the Federal Reports
Act, and the Office of Federal Statistical Policy and
Standards in the Department of Commerce because of its
Government-wide responsibility for statistical coordination,
also have "central" clearance responsibilities. With the
advent of the Department of Education, further fragmentation
will result. This fragmented structure creates many problems.
I will touch on only a few.
First, it creates difficulties in performing something
as basic as compiling an inventory of all approved Federal
reporting requirements. GAO has worked closely with OMB
on this task and progress has been made, but the task is
made unnecessarily difficult because each central agency
has its own constantly-changing inventory of requirements
and its own way of accounting for them. A single control
point would greatly facilitate this task and provide one
place where the Congress, the public, and other Federal
agencies could look for a comprehensive inventory of Federal
reporting and recordkeeping requirements.
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Second, and closely related to the first point, the
fragmented structure creates serious difficulties in trying
to control duplicate information requests. Although GAO and
the other central clearance agencies attempt to coordinate
their efforts, the fragmented responsibility makes it very
difficult to determine with any assurance whether a request
submitted to one clearance agency duplicates something already
cleared by another. Establishing a single central clearance
agency and developing a Government-wide information locator
system as provided in H.R. 6410 would greatly enhance the
ability to control duplication.
Third, the fragmented structure creates jurisdictional
problems in determining which of the central clearance agencies
has authority to clear certain agencies' or certain types of
requirements. For example, GAO cleared requirements of the
Equal Employment Opportunity Commission (EEOC) for several
years under agreement with OMB that EEOC was an independent
regulatory agency. When the current Administration broadened
the scope of EEOC's activities, it questioned the appropriate-
ness of the earlier determination that EEOC's reports should
be cleared by GAO.
The issue was eventually resolved by EEOC shifting to
clearing its requirements through OMB, but this resolution took
a great deal of work by GAO and OMB clearance and legal staff
which could have been more productively spent on other matters.
Establishing a single central clearance authority as called
for by H.R. 6410 would avoid this type of nonproductive effort.
Fourth, the current fragmented clearance structure creates
confusion for the Congress and the public in obtaining infor-
mation and advice and in making their views known on issues
and problems associated with Federal information-gathering
activities. To illustrate, we frequently receive inquiries
from Members of Congress, congressional committees, and the
public about particular Federal information requirements.
Frequently, these inquiries relate to requirements which have
been or are being reviewed by OMB. The reverse is also a
common occurrence.
Obviously, we refer such inquiries to OMB and they to
us. Nevertheless the process is time consuming and could
be handled more expeditiously if one agency had overall
clearance responsibility.
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A more fundamental problem here may be the image of
a confused and excessively complicated bureaucracy created
in the minds of our citizens who need help with a Federal
information requirement. The burdens imposed by the require-
ments are frequently onerous by themselves. Being shifted
from one agency to another to get a question answered only
rubs salt in the wound.
Fifth, and finally, we have always believed that clearance
of the independent regulatory agencies' proposed information
requirements involves GAO in the day-to-day performance of
executive activities in a manner inconsistent with our respon-
sibilities for oversight and monitoring of such activities.
We believe our limited resources could be more productively
used to aid the Congress in controlling Federal paperwork
burdens by our audits and reviews of Federal agencies' infor-
mation-gathering practices and procedures rather than by
our involvement in clearance reviews of the regulatory
agencies' individual forms and questionnaires.
Question 2. General, you testified.in support of
including the statistical policy function in the new office.
As you know, there has been some disagreement in the Executive
Branch over where this function should be placed. In your
opinion, is 0MB the most logical location for this function?
--the close relationships between the statistical
policy function and?the other information management
activities addressed by H.R. 6410--especially paper
.work burden control--are maintained and enhanced,
--stability is provided to allow for dealing with the
long-term issues-and problems involved in improving
the decentralized Federal statistical system,
--sufficient stature is provided to enhance the
necessary leadership role for-planning and coordi-
nating Government-wide statistical activities and
to attract the highest quality personnel,
--the statistical policy'un-it.is not burdened with
operating responsibility best left to the statistical
agencies,
61-222 0 - 80 - 20
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We believe that moving the statistical policy function,
currently in the Department of Commerce, to the new OMB
office established by H.R. 6410 would meet these objectives
and provides the most logical arrangement.
Question 3. H.R. 6410 does not prohibit the Director
of OMB from assigning additional functions to the office.
There is a possibility that inappropriate functions may be
assigned to the office, which could lead to undermining the
responsibilities assigned by this legislation. What criteria
would you suggest be used by the Director in assigning any
additional functions?
Answer. The functions assigned to the new OMB office
provide for carrying out various policy and oversight
responsibilities for Federal information management activities.
These activities are all interrelated and, taken together,
cover the entire information cycle from defining information
requirements through records disposal.
We believe it would be unwise to assign any additional
functions to the new office which are not directly related
to information management activities. We also believe that
care must be taken to insure that the office does not become
tasked with day-to-day operational activities which should
be performed by the individual agencies.
Question 4. Do you think that management of the infor-
mation resource activities listed in the bill would be enhanced
by the addition of regulatory reform functions to the Office
of Federal Information Policy?
Answer. We do not believe that regulatory reform func-
tions should be added to the Office of Federal Information
Policy. As noted in my response to question 3 above, H.R. 6410
provides a foundation for the Federal Government to improve
its overall information management activities. Although the
collection, analysis, use, and dissemination of information
is an important part of the Federal regulatory process,
regulatory reform is a broader and somewhat different issue.
The relationship between the regulatory process and
information management is reflected in OMB's existing Office
of Regulatory and Information Policy. This Office, which we
assume would provide the core staff for carrying out the
overall information policy and oversight responsibilities
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called for by H.R. 6410, is currently charged with responsi-
bility for several information management activities and for
overseeing agencies' progress under Executive Order 12044,
Improving Government Regulations.
We believe: this organizational arrangement has worked
well and have no basis for objecting to it., we would urge,
however,.that.the new Office of Information Policy established
by H.R. 6410 not be given added responsibilities of any type
which could divert it from its-basic mission of.improving
Federal information management.
Question 5.' The success of the new office in meeting
its responsibilities under this legislation will depend
greatly on how successful it is in. establishing the Federal
Locator-System. It is my understanding that OMB may.-delegate
this responsibility to some other agency, such as DOD. What
would be your view of such a transfer?
Answer. We would oppose. delegating'control?of the
development, design, and implementation of the locator system
to-an agency.'other. than OMB. "However, technical support in
terms of system design,.software-development, data input,
computer operation and so.forth may have to be-provided by
other agencies.
The recently. issued report'of the Federal Information
-Locator System Task Force provides -a detailed plan for develop-
ing and implementing a locator system. -The plan provides that
each agency would have responsibility for loading and maintain-
ing.data on its information.+requirements in accordance with
un'ifo'rm standards, to be established by OMB.' However, as far as
we'-can'determine, this report does not provide for delegation
of system-control-to DOD or any other agency. Although we would
.have no-problem with the delegation of the day-to-day computer
epeaations,of the system once it has been developed, central
control must be maintained in OMB as a management responsibility
to'insure integrity and reliability of the system.
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304
ENCLOSURE II ENCLOSURE II
Costs And Benefits Related
To H.R. 6410
The cost estimate for the OMB Office of Federal Informa-
tion Policy for fiscal year 1981 was determined as follows.
1. The average cost per position for OMB and OFPP according
to the fiscal year 1980 budget was about $54,000.
2.
The estimated number of positions (120) for the Office
of Federal Information Policy was
a.
Reports clearance, burden reduction, and
Paperwork Commission recommendation oversight
38
b.
Statistical policy
40
c.
ADP, telecommunications, and privacy
12
90
d.
Estimated additional positions for records
management oversight, locator system core
staff, and to bolster other functions
30
Total. Estimated Positions
120
3. $54,000 x 120 = $6.5 million for personnel
4. Estimated computer and support costs for Federal
Information Locator System = $1.5 million
5. Total Estimated Cost (3)+(4) = $8 million
6. At least 80 of the positions are currently (FY80)
funded. Work is also being carried out toward the
development of the Locator System although the extent
of the costs being incurred for the Locator System
are unknown. $54,000 x 80 = $4~.3 million
7. Net cost for the Office of Federal Information Policy =
$3.7 million
NOTE: Over half of the estimated $8 million
cost for fiscal year 1981 could be
absorbed from existing authorizations.
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The benefits to be derived from-passage of:B..R..6410,
will, to a great extent; result-from imp-roved,policysetting,
standards development, program evaluations, and oversight
by the OMB Office of Federal Information Policy. 'Greater
attention to managing information activities.-within the
agencies should also result from the management structure
being created under the bill. Thus, some benefits resulting
from these actions can not be quantified but, nevertheless,
the benefits will be substantial.
GAO has issued numerous. reports dealing with a wide variety
of information management issues. The examples::provided.below
illustrate the problems identified and demonst-rate opportunities
for cost savings both within- the _~Federal' Government -and. for the
private sector through more effective information management.
The Air Force Should Cancel Plans to
Ac uire Two Com-15. S/2 stems at Most
Bases (FGMSD-8015; 106 79)
The Government could save hundreds-of millions of
dollars if the Air Force redirects its Phase IV computer
system acquisition-program. Phase IV is a computer system
replacement program with estimated-20-year life cycle
costs which exceed-$5 b'illion. GAO.found..that the Air
Force's stated requirement fora minimum of two new-:.computer
systems, that can run-the-same computer program, at about
105 bases
-has never been justified as-mission-essential or
operation-ally required,
---was established without developed or defined base-
level user requirements, and
--would result in -$6a0 million-to $1 billion of
additional cost,,overtthe 20-,year expected life
ofthe program.
The report recommends that the Air Force -cancel its current
request for proposals for the program and-develop a simpler,
more flexible request for proposals with functional performance
requirements representing actual base-level operations and
needs.
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Contracting for Computer Software
Development--More Management Attention
Could Avoid Wasting Additional Millions
(FGMSD-80-4; 11/09/79)
Many Federal agencies have computer programs--called
software in the data processing industry--developed by out-
side sources. These sources may be either private firms
or other Federal agencies.
GAO examined nine cases of software development in
detail. Eight had problems, but their overall performance
cannot be taken as representative--some came to GAO's
attention because they were failures. Nevertheless, the
cases illustrated many of the same causes of difficulty
that GAO had identified through a questionnaire study.
Only one of the nine cases yielded software that could
be used as delivered. The combined total costs and develop-
ment times of the nine cases increased from estimates of
$3.7 million and 10.8 years to actual cost of $6.7 million
and an actual duration of 20.5 years.
The report recommends that the National Bureau of Standards
and the General Services Administration issue specific guide-
lines to assist Federal agencies in recognizing and dealing
with the unique problems of contracting for software develop-
ment.
Federal Paperwork: Its Impact
on American Businesses
(GGD-79-4; 11/17/78)
GAO reported to the Joint Economic Committee on the
nature and extent of Federal reporting and recordkeeping
requirements affecting private industry. According to
Federal agency estimates, businesses take about 69 million
hours annually at an estimated cost of over $1 billion to
respond to more than 2,100 reporting requirements approved
by OMB and GAO. However, these requirements represent only
the tip of the iceberg because about 78 percent of the Federal
reporting requirements are exempt from clearance. ,Further-
more, the accuracy of the burden estimates provided by Federal
agencies is unknown and questions regarding their accuracy
need to be resolved.
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Even a small percentage reduction in the burden imposed
would result in substantial savings to businesses and an added
amount of savings to the Government by not having to collect
or handle the information.
Millions In Savings Possible In
Converting Programs from One Computer
to Another (FGMSD-77-34;15/77)
Frequently, computer programs must be converted to make
them run on a computer different from the one for which they
were originally devised. The annual Federal cost of such
conversions was estimated at more than $450 million. GAO
estimated that about 24 percent--over $100 million--could
be avoided in today's environment. GAO identified a number
of factors which tended to increase conversion costs but
estimated that the costs could reasonably be reduced
with good conversion planning and practices.
The report recommended that (1) 0MB assist in establishing
a Federal center for software conversion, (2) agency heads
emphasize quality and standards in new software development,
and (3) the National Bureau of Standards publish a set of pro-
grammer productivity aids for Government-wide use.
Better Information Management Policies
Needed: A Study of Scientific and Technical
Bibliographic Services (PSAD-79-62; 8/6/79)
Although the Federal Government spends billions of dollars
to create, collect, and disseminate scientific and technical
information, it pays little attention to information policies
or how information activities are managed. GAO studied Govern-
ment information centers providing bibliographic services to
the scientific and technical community. It found evidence
of duplication, proliferation of facilities, and inconsistent
cost recovery practices. The vagueness of authorizing laws
and function statements contributes to the duplication of
services.
The report recommended that, where the Congress enacts
legislation establishing information centers or clearing-
houses, each act require the agency to use existing systems
in the Federal agencies or the private sector at lesser
cost to the extent possible. Also, the OMB Director should
work with the executive departments to develop a clear policy
of cost recovery consistent with applicable statutes and
require the agencies to develop information on the cost of
information services to serve as a basis for carrying out an
effective cost recovery program.
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An Informed Public Assures That Federal
Agencies Will Better Comply With Freedom
of Information/ Privacy Laws
(LCD-80-8; 10/24/79)
Statement of Elmer B. Staats, Comptroller
General of the United States, Before the
Subcommittee on Legislation and National
Security, Committee on Government Operations,
House of Re resentatives, on H.R. 6410, 'The
Paperwork Reduction Act ot 198V (2/7/80)
Analysis of Department of Justice data on selected court
cases arising because of agencies' denials of requests for
records citing these laws showed:
--The monthly flow of new suits was continuing at a
relatively stable rate;
--a substantial backlog of open cases was steadily
accumulating; and
--when sued, agencies often released considerable
information in records they had initially denied
requesters.
Better policy guidance in advance of the litigation
stage, complete with better communication of the results
of cases, could reduce the necessity for future litigation,
thereby improving implementation of the two laws and
reducing litigation costs. Because the two laws were
intended to complement each other on matters of public
access to records, their administration within OMB would
benefit from close coordination.
The Federal Information Processing Standards
Program: Many Potential Benefits, Little
Progress, And Man Problems
(FGMSD-78-23; 4/19/78)
Federal agencies have become locked into suppliers of
computers and services because essential automatic data pro-
cessing standards have not been developed or agencies are not
complying with present standards. As a result, potential
savings available through competitive procurement are not
being fully attained.
Conversions of computer programs are expensive; they now
cost the Government an estimated $450 million each year.
An improved standards program will not achieve cost savings
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without good management, but it will offer the greatest impetus
toward reducing conversion costs and promoting fully
competitive procurements.
The report provides information on the types of standards
-most needed to achieve Government-wide economies and makes
recommendations to improve the-Federal automatic data pro-
acessing standards program.
After Six Years, Le al Obstacles Continue
To Restrict Government Use o t e Stan and
Statistical Establishment List
(GGD-79-17; 5/25/79)
The Bureau of the Census has developed the Standard
Statistical Establishment List, a comprehensive list of
businesses in the United States. Many federal statistical
agencies could use such information. But confidentiality
laws prevent the Census Bureau from sharing List information
with other agencies. Amendments to these laws would help
improve the quality and comparability of economic statistics
and reduce business response burden-from-numerous Federal
statistical surveys.
Several reasons have been given for the recent delay
in submitting legislation for congressional consideration.
The Tax Reform Act of 1976 severely restricted the use of
tax records by Federal agencies, even for statistical
purposes. Also, the transfer of program responsibility
from the Office of Management and Budget to the Commerce
.Department and limited staffing delayed work on the draft
legislation. Finally, the Congress and the country were
not generally receptive to relaxing confidentiality
restrictions.
The::,.report-,recommends:that the Secretary of Commerce
establish a priority date fo.r-submitting proposed legisla-
tive changes to the Congress.
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APPENDIX E.-STATEMENTS SUBMITTED FOR THE
RECORD
Legislation and National
Security Subcommittee
THE ASSOCIATED GENERAL CONTRACTORS OF AMERICA
1957 E Street, N.W. ? Washington, D.C. 20006 ? [phone] ? TWX: 710-955-1134 AGC AGTN
PAUL N. HOWARD. JR., President IVAL R. CIANCHETTE. Senior Vice President THOMAS E. DAILEY, Vice President
CUFF MORTENSEN. Treasurer JAMES M. SPROUSE, Executive Vice President HUBERT BEATTY, Executive Director
The Honorable Jack Brooks
Chairman, Subcommittee on
Legislation and National Security
Committee on Government Operations
Room B-373, Rayburn House Office Bldg.
Washington, D.C. 20515
Please accept this association's endorsement of testimony
given this date to your committee on HR 6410, The Paperwork Re-
duction Act of 1980 by the Business Advisory Council on Federal
Reports.
AGC is a long-time, active participant in BACFR. We are
aware of the careful deliberation with which the BACFR testimony
was prepared, as we participated in that process. We support
HR 6410, but recommend some modifications.
Of special concern to AGC are the BACFR recommendations,
which we support, that:
a. All agencies be subject to central review.
b. Review authority should not be delegated to originating
agencies without clear evidence that the fox is pre-
pared to guard the chickens. If such delegation is
to be permitted, a residual final OMB accountability
is essential.
We request that this letter be made a part of the hearing
record on HR 6410.
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JCIIVG VOLU N"rARV LEADERSHIP IN ACHANGING WORLD
~~1111~ 1
Chamber of Commerce of the United StatRXC E*, Nw
202.659-8140 WASN1-N. D.C. 20082
MAR 191980
Legislation and National
SeftT`i'! D
_The.Honorable Jack Brooks
e ON
Chairman HOUSE COFIMITi
Government Operations Committee GOVEith, "E:I OPERAI IONS
House of Representatives
Washington, D.C. 20515
Re: THE PAPERWORK REDUCTION ACT OF - 1980(H.R.6410)
The Chamber of Commerce of the?United States,' representing
over 94,000,members, strongly supports the Paperwork Reduction Act
of 1980. It'is essential to bringing under control.the rampant growth
of government paperwork,. while contemporaneously developing guidelines
which will insure that information is collected efficiently and with
the least possible burden.
We support creation of the Office of Federal Information Policy
within the Office of Management and Budget. Part of the reason
paperwork grows almost unchecked is the failure to place responsibility
for its control with any one person or.office. The bill provides
that the Director of the Office of Federal Information Policy will
develop standards and provide consistency, guidance and support. If
government agencies are unresponsive to their mandates, the Director
is in a position to inform the Congress and public.
We are particularly pleased that H.R. 6410 requires that the
Director, consult with interested non-governmental persons in the develop-
ment of rules-and policies. This recognizes that parties affected
by the burden can play a useful role in lessening the.burden, and in
helping assure that information collected is appropriate and necessary.
We suggest this mandate be extended to rules, information requests,
and procedures initiated by the'federal agencies.
It is important that those who implement this legislation have
a clear understanding of how to measure the paperwork requirements
imposed on respondents. In this regard, it is necessary that the bill's
definition of "burden" go beyond the collection, collating, typing and
transporting of information. "Burden" should recognize that the
respondent might be forced to collect information he would not otherwise
collect, go through procedures not normally. used, or specially adapt
systems -- all to comply with an information request. These "second-level"
burdens are not as obvious or as easy to compute as the cost of repro-
ducing a-document. They are, however, real and.should be considered
an integral cost of paperwork compliance.
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We strongly support the bill's concept of a Federal Locator
System, defined as a type of cross index. If effectively used and
supported, it can decrease duplication in information requests
tremendously.
We agree that the Director should evaluate the agencies'
informational practices, as provided in Section 3504 (b)(5). Addi-
tionally, this review should include an evaluation of the effect of
the practices on recipients of the requests.
In Section 3504 (c)(2), we suggest the addition of the phrase,
"in light of the burden placed on the respondent." Information almost
always has some utility. The information should be tested to deter-
mine whether its benefits are outweighed by its costs.
We-applaud provisions to improve privacy, confidentiality
and disclosure standards. An agency receiving confidential informa-
tion from another agency should be allowed to distribute that in-
formation only in accordance with the original agency's privacy
policy unless its own policy is more restrictive, in which case the
more restrictive policy should apply. We agree that the task of
insuring privacy is of such critical importance that the involved
agency should be required to permit participation by the business
community and other affected groups.
Regarding Section 3510(b), before any specific information is
released from one agency to another, the organization it was collected
from should be notified.
The Chamber, like the American public, is critically concerned
with inflation and the role of government spending in it. Because of
this concern we oppose new funding authorization for this bill. We
suggest the Congress fight inflation, as well as paperwork, by funding
this bill with monies from existing programs. For example, when the
General Services Administration designs a work place layout for an
agency, that agency pays GSA. Similarly when an agency benefits from
this paperwork reduction program it should pay OMB.
Paperwork is an issue that cuts across all sectors of govern-
ment and private industry. The time and cost of the paperwork burden
can be crippling to businesses of all sizes. H.R. 6410 goes a long
way toward reducing the cost and frustration of the paperwork problem.
We appreciate your considering our views and respectfully re-
quest that this statement be made a part of the hearings record.
Vice President
Legislative and Political Affairs
cc: Committee members
William M. Jones
John Duncan
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CIVIL AERONAUTICS BOARD
WASHINGTON, D.C. 2042! w wrs~r wcrcw ro: B-1-35
.Honorable Jack Brooks
Chairman
Committee on Government Operations
U.S. House of Representatives
Washington, D.C. 20515
RECEIVED RECEIVED
DEL 9 1 1973 DEC 1 91979
Legisie.uun and Natiorcl HOUSE COMMITTEE ON
Security Subcon;mltteo GOVERNMENT OPERATIONS
The Board has reviewed H.R. 3570, the Paperwork and Redtape Reduction
Act of 1979, as you requested.
The bill would amend the Federal Reports Act, and attempt to improve
Federal information management by centralizing control responsibility
and coordination. An Administrator for Federal Information Management
Policy and a Federal Information Locator System would be created for
this purpose.
The Board-supports the approach of the-.bill'as a good way to improve
Federal information management by treating information as a resource, to be
managed as such. We have recently reorganized our own system to
streamline the information process, and to improve management of this
resource. This helps us to review continuously our information needs
and reporting requirements, from the viewpoint of the offices dealing
directly with the information. It has reduced the Board's staff needs
in this area, and will also ensure that cost-benefit analyses are
included in decisions about the use of information and whether new
reporting requirements are needed.
There are three especially beneficial aspects of H.R. 3570. It would
consolidate all Federal information management functions under one senior
official, thus providing a high level focus for the management of Federal
information resources. Agencies woiuld.also-lie-fRquired So designate an:
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fit!'dPYhtffln~eana~.rsos-eoeedfnate information-gathering activities.
-Finally ;~3fte4erel dfoY,~AAttq~{; eatam;5*s^a65as-Song been needed to
prevent duplication of Eeffor.t,by the agencies and overlapping reporting
burdens on the public.
While we su ort the objectives of the bill, there appear to be
severs n the proposed changes in the application of the
Federal Reports Act to independent regulatory agencies. In proposed
sections 3505, 3506, and 3507, the Administrator is given authority to
prohibit an agency from collecting information in certain circumstances.
It is the agency, not the Administrator, that has responsibility for
meeting the objectives of its organic statute, and the expertise to do
so. As under proposed section 3509(a)(3), governing information collection
-requests,-an-independent-?agency-shouid-v~.,pioceed-despite-th4
_:e_ AdmiaietraWris=+decision~'f?n@eessary-2e~eeet i-is--~eLeCotory ~Olillgstioos~~
as` ong5as,at-pubiiehea-dLe eaaons:foraso.doing.
Also, proposed section 3510 would allow 60 days for the Administrator's
review of agency proposals, with a 30-day extension possible at the
Administrator's discretion. The present Federal Reports Act allows only
45 days. S4~ehhz a-increase;:d~-the-_3imespRt o ppeacs~unnecessar t It
would tend to reduce the effectiveness of the Act, and would build
further delays into the regulatory process.
Finally, one technical change should be made in proposed section
3509(b). That section states that the Administrator shall not approve
information collection requests for longer than 2 years in duration,
unless previously approved by the Director, Office of Management and
Budget. -The-section
s~c~a*+gad.~,tp include prior--approveiadry
tike...6gneral~Ec,pi+iitiiig=laf#icey.-which.approves~iequests""tiy' ndeenenl
ageatiea^naer-.the_present.Aet.
II trust these comments are
helpful in consideration of this bill.
0MB has told us that these views do not-represent the views of the
Administration.
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aecuriLy a uocommittetOMMODITY FUTURES TRADING COMMISSIONGOVEppN'fA COMMITTEE
2033 K Street, N.W., Washington, D.C. 20581 ENT OPERgTIONV,
Honorable Jack Brooks
Chairman, Committee on Government Operations
U.S. House of Representatives
2157 Rayburn House Office Building
Washington, D. C. 20515
As I stated to you in my letter of 1979, your letter
of April 30, 1979 requesting comnent on I.R. 3570, a "Paperwork and
Redtape Reduction Act of 1979," has been re erred to my Office for
response.
We favor the goals of the bill to reduce the paperwork burden
on the public imposed by federal agencies; to make more uniform guide-
lines and standards for evaluating the need for collection of infor-
mation; and to establish a federal information locator system to as-
sist federal agencies in determining, prior to requesting specific
information from the public, whether any other agency already obtains
such information. We do, however, question certain provisions of
the bill, including certain of those which would basically subject
information collection by independent regulatory agencies to the same,
oversight procedures to be applicable to information collection by
executive departments, as more fully set forth below. _
H.R. 3570 would, in proposed ?3503, create an Office of Infor-
mation Management Policy in the Office of Management and Budget, and,
under proposed ?3504, would transfer to the Administrator of that office
responsibility for setting federal information management policy. Pro-
posed ?3515 would make the authority of all federal agencies to promul-
gate reporting and recordkeeping requirements as well as conduct other
information collection activities subject to the authority conferred
on the Administrator by H.R. 3570.
Granting to a single administrator authority to oversee reporting
and recordkeeping regulations promulgated by independent agencies, such
as the Commission, pursuant to their particularized regulatory statutes
has the potential to frustrate and interfere with their normal regulatory
functions. Although proposed ?3511(b) does provide that the Administrator
may delegate the responsibility to approve collection of information to
an agency, the Administrator may revoke that delegation at any time.
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In this-connection, we are also concerned about-the broad scope
of information collection which could cane under.scrutiny of the Admini-
strator. The definition in proposed ?3502(5) of "collection of informa-
tion" could be construed to.include not only information gathered for
statistical purposes, but also information necessary for an independent
.agency to perform its statutory functions and, perhaps, the agency's
information gathering during enforcement proceedings. We believe that
the current.definition of "information" contained in 44 U.S.C. ?3502 is
sufficient. In this regard, it is the Commission's view that the present
definition encompasses collection of statistical information and does not
include information gathering required pursuant to regulatory functions,
such as registration of-commodity professionals and market surveillance.
The exclusion of such regulatory information should be carried into the
new law. 1/ Further, the proposed definition does not specifically
exempt gathering of information for law enforcement purposes. Current
regulations promulgated pursuant to 44 U.S.C. ?3512(f) specifically
exempt from the scope of General Accounting Office review "[c]ollection
of evidence or other information in connection with litigation" and
"quasi-judicial proceedings or formal or informal investigations under-
taken withreference to particular individuals or entities"-concerning
violations of statutes, regulations-or-other requirements. 4 C.F.R.
??10.6(c)(4) and (c).(5 The proposed statutory definition of informa-
tion collection should be modified to exclude from its purview informa-
tion collected in connection with enforcement activities.
With regard to information collection for which approval of the
Administrator is required, we'- do not understand the bill to differ sig-
nificantly from the provision of present law which specifically provides
that independent regulatory agencies ultimately decidewhether there
is a need to collect information. See 44 U.S.C. ?3512(d). Proposed
..?a Pursuant. to-the Federal -Reports Act 6D194 2, as amended by
Section 409(b)-of the Trans-Alaska Pipeline Authorization Act,
44 U.S.C. ?3512, the Commission submits to the Comptroller
General.for his review general questionaires to.be used by
the Commission for statistical information gathering. The
Commission. has taken the?position, which it believes correctly
'reflects-the. law, that forms that the Commission has adopted
in the performance of its: statutorily-mandated regulatory
responsibilities-particularly those relating to registration,
recordkeeping and reporting requirements under the Commodity
-Exchange Act-are not subject-tothe Comptroller-General's
- review under the Federal Reports Act.
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?3509(a)(3) would provide that by a two-thirds vote an independent regu-
latory agency, such as the Commission, could void a disapproval by the
Administrator of its information collection request. But we are con-
cerned that the bill might well interfere with the Commission's ability
to gather statistical information on a timely basis.
Currently, the Comptroller General has 45 days to clear an
independent regulatory agency's request for collection of information.
If no action is taken by the Comptroller General in that period, the
agency may collect the information. See 44 U.S.C. ?3512(d). moreover,
regulations issued pursuant to 44 U.S.C ?3512(f) provide for faster
clearance should an emergency exist. Proposed ?3510 would expand the
normal time allotted for clearance by the Administrator to 60 days.
In addition, under the bill, that period could be extended by the Ad-
ministrator for another 30 days if he determined the request to be suf-
ficiently controversial or complex. if no word is forthcoming from
the Administrator by the expiration of the time provided for clearance,
his approval may be implied and the requesting agency may collect the
information. Although the bill provides that agencies may ultimately
collect information if no word is received, the doubling of the time
for approval could effectively prevent the Commission from obtaining
information promptly in particular instances. Thus, we believe that
the bill should provide for expedited review by the Administrator at
the request of the agency.
We are also concerned that the Commission's independent regu-
latory posture could be impaired by proposed ?53505 and 3506. Proposed
?3505 would allow the Administrator, after investigation and hearing,
to order that information requested by one agency, including an inde-
pendent regulatory agency, be collected by another agency, subject to
the limitations on inter-agency sharing of information imposed by non-
disclosure laws. Proposed ?3506 would prohibit an agency from enforcing
a request for information the Administrator determines is to be collected
by another agency. The Commission's mandate to supervise the nation's
commodity futures markets requires that it receive information that it
considers necessary. If another agency were directed to collect infor-
mation for the Commission, it might well have different regulatory pri-
orities and, perhaps, insufficient resources to enforce the Commission's
requests for information. Independent regulatory agencies should retain
the authority to collect information they deem essential to discharge
their statutory responsibilities effectively.
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Finally, pursuant to proposed S3507, the Administrator could
determine the necessity and practical utility of an agency's collection
of information at the request of a party having a significant interest
in the matter or upon the Administrator's own motion. That provision
further provides that the Administrator may grant the agency and other
interested persons an opportunity to be heard or submit written state-
ments on the issue. Vie believe this procedure could result in protracted
hearings that would undermine the reasons for requesting the information
in the first instance. Moreover, we submit that, if such a determination
is undertaken, the agency concerned should be notified and be permitted
to participate as a matter of right in order to insure that the views of
the body entrusted with protection of the public interest and effectua-
tion of a particular Congressional scheme be heard.
In summary, we support the primary objectives of H.R. 3570-
reduction of the paperwork burden on the public and bringing greater
uniformity to federal information management. However, these objec-
tives must be balanced against the legitimate need of an independent
regulatory agency to act on a timely basis in appropriate cases to
gather information necessary to fulfill its statutory obligations.
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FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON. D.C. 20554
Honorable Jack Brooks
Chairman, Committee on Government Operations
B-373 Rayburn House Office Building
Washington, D.C. 20515
Leg,--n and IVanonal
Security SuI committee
IN REPLY RFPER TO:
3700
The staff of your Subcommittee on Legislation and
National Security advised me informally that comments
from the Federal Communications Commission would be welcome
concerning ::.R. 6410, the proposed Paperwork Reduction Act
of 1930. I understand that the Subcommittee completed
mark-up of H.R. 6410 last week, and thus I am addressing
the following comments to the full Committee on Government
Operations. I would appreciate the inclusion of this letter
in the record. Its ou a noted that comments are
from the Commission's Office of General Counsel.
6410 is intended to reduce the federal reporting
IT
and recordkeeping burden on the public and to improve
federal information management. To this end, the bill
would establish a separately funded office, within the
Office of Management & Budget (OMB), to oversee federal
agencies' information related activities. The Director
of 014B would be granted extensive authority, through the
new office, to ensure that the government collects the
information it needs efficiently and maximizes that
information's utility. While I am in agreement with the
basic purposes of the bill, I would like to propose that
several sections be clarified to ensure that independent
regulatory agencies remain free from direct control by the
Executive Branch.
The autonomy of independent agencies is affected because
it is not possible to separate information management from
substantive agency policymaking. Information gathering is
essential to formulating policy, and a principal means of
enforcing regulation is to verify compliance through informa-
tion collection. As OMB's representative recognized in his
statement before your Subcommittee, information management
requires a balancing of the competing interests -- such as
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?socie-tal needs, the- burden on, the public, privacy, and
budget impact -- which-are present in any agency program.
Statement of Wa a Grand uiat 0MB.Associate Director for
Management and Regulatory o 'c on H.R. 6410 before the
Subc. on Legislation. an National Securit of t Fe Souse
Committee on Government . erat ons, 96th Cong., 2n Sess.,
(February This balancing is the essence of
regulatory policymaking, and to. grant ultimate control over
agency information, policy.to 0MB could result in total. loss
of independent agencies'--limited autonomy from the Executive
Branch. For example, the-Federal Communications Commission
has adopted a substantive policy concerning equal employment
opportunity among broadcast licensees that is almost entirely
dependent upon collecting data from licensees on their
employment practices. The power to prevent collection of
that data could be used to prevent enforcement of the policy.
My concern centers on three sections of H.R. 6410's pro-
posed new chapter 35 of Title 44, each of which would
prohibit agency information collection without the approval
-of the 0MB Director:
-- ?3507(a) provides that each agency (1) must
submit Its proposed information collection
.requests to OMB for review and (2) must receive
the Director's approval before it collects the
information;
-- ?3508 provides (1) .that the Director has
authority to hold a hearing on proposed
information collection requests, (2) that
certain standards may be used in reviewing
those proposals, and (3) that an agency may
not collect information if the Director
determines that its collection is "unnecessary,
for any reason;"
-- ?3509 provides (1) that if__the-Director determines
that one agency could serve the-information
collection needs of two or..more.agencies, he
may designate a single-agency to collect the
information, and (2) -that an-agency, under such
a determination and not the designated collect-
ing agency, would be prohibited from- collecting
the information for itself.
Section 3507(b) does contain a provision to protect the
information gathering capabilities of Independent regulatory
agencies, but I am concerned that it is too limited in effect.
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Section 3507(b) provides only that an independent agency may
void an adverse determination made under ?3507(a) if a majority
votes to override the Director's decision. Read literally,
this protection would not extend to an adverse determination
made under either ?3508 or ?3509. Such a reading may seem
Q unlikely, but a court could conclude that Congress did not
intend to allow an independent agency to void the Director's
decision if it were made after a hearing pursuant to ?3508.
Or a court could conclude that once a single collecting
agency is appointed under ?3509, this determination precludes
any other agency subject to that order from filing a request
for that information under ?3507(a). Accordingly, it is
possible that the override provision of ?3507(b) could be
inadequate to prevent complete 0MB control over independent
agencies' information activities.
The ambiguity in these sections could be removed easily
by placing the independent agency override protection con-
tained in ?3507(b) in a separate section that clearly would
apply to ??3508 and 3509, as well as to ?3507(a). The word-
ing-of subsection (b) could remain intact except that the
words "under subsection (a)" should be deleted. In my opinion
this would not expand the nature of the exception the drafters
of the bill intended to create, and it would at least remove
substantial uncertainty as to the bill's effect.
I have not addressed the rationale as to why independent
regulatory agencies, such as the FCC, should not be under
executive control, since the reasons vary with each agency's
congressional mandate. It is arguable that the goals of
efficiency and centralized accountability might now outweigh
the factors which originally led to the designation of some
federal agencies as "independent" from executive control.
Nevertheless, any action revising the degree of agency
independence should be closely examined in the context of
each independent agency's mission. To redefine those
relationships across the board in the name of paperwork
reduction would be a very dangerous approach to regulatory
reform.
Robert R. Bruce
General Counsel
Approve or - -
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
The Honorable Jack Brooks
Chairman
Subcommittee on Legislation and
National Security
Committee on Government Operations
House of Representatives
Washington, D. C. 20515
'RECEIVED
FEB 2 5.198:
LegiSlation and National
Security Subcommittee
J. CHARLES PARTEE
I am glad to respond to the Subcommittee's request for
comments from the Federal Reserve Board on H.R: 6410, the "Paperwork
Reduction Act of 1980". I had previously presented the Board's views
on S. 1411, the "Paperwork and Redtape Reduction Act of 1979", in
testimony before the Senate. Subcommittee on Federal Spending Practices
and Open Government on November 1, 1979. While H.R. 6410 differs in
some respects from S. 1411, the basic thrust of the bills is similar
enough so that many of the Board's concerns with the earlier bill
apply to this bill as well.
As I stated in November, the Board is sympathetic with the
general objective of the bill--.to reduce paperwork and to put effective
controls on the process of imposing reporting and recordkeeping
requirements on the public. Reporting burdens have grown sharply
over the years and there can be no question of the need for stern
discipline on agency reporting activities. As a matter of proper
procedure, all statistical initiatives should be required to demonstrate
(a) that there is a pressing need for every piece of information
requested; (b) that there are no unnecessary duplicative collection
efforts; (c) that information is asked for in the most efficient and
least burdensome manner; and (d) that existing data sources, from what-
ever agency, have been utilized to the extent feasible.
BOARO OF GOVERNORS
OFTHE
FEDERAL RESERVE SYSTEM
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The Federal Reserve has endeavored to conduct its data
collection efforts with this kind of discipline. Over the years we
have strengthened and intensified our report controls. Since 1975,
we have had in place a comprehensive system of clearance procedures.
These procedures have been reviewed periodically, and, to the extent
appropriate, changes in clearance standards promulgated by Executive
Order or by OMB guidelines have been incorporated in our program.
Our program applies both to proposals for new reports and
to all existing reports. Under the program, every Board reporting
series is periodically reexamined on a zero-based approach to see
whether it can be eliminated, cut-back with respect to contents or
reporting panel, or otherwise improved with respect to reporting
burden. Every Board report is subjected to critical review at several
levels and must be justified in detail before it is adopted or renewed.
We devote a substantial amount of resources to this program, which is
coordinated at the senior staff level. Moreover, the program involves
active participation by several members of the oa d, and the final
decision on all report proposals is made by the Bo rd as a whole.
We believe that our program for the control and reiew of reporting
is one of the most comprehensive in the federal go ernment, and that
the program already incorporates both the essence and most particulars
of the provisions of section 3506 on "Federal agency responsibilities".
We have had good success in recent years with the Board's
program of reducing reporting burden. From the end of 1975 to mid-year
1979, we managed to reduce by almost 25 per cent the total number
of items of information reported to us on all our reporting forms other
than those directly related to the accounting for deposits subject
to reserve requirements. (This total is measured by taking the number
of items of information on each report multiplied by the number of
respondents and the frequency of reporting within a year and then
aggregated for all reports.) While this rate of net reduction probably
cannot be sustained--given new legislation, new supervisory and
monetary policy needs, and the fact that the first cycles of review of
existing reports will always discover greater opportunities for
reduction than subsequent cycles--the Board's clearance and review
program will continue to ensure that reporting burdens are kept to
the minimum consistent with the effective discharge of our monetary
policy and supervisory responsibilities.
I have gone into our report clearance procedures at this
length because the scope and success of these established procedures
bear directly on a major feature of the bill--the proposed elimination
of the Board's current exemption from OMB jurisdiction under the
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Federal Reports Act. While our report clearance procedures have
incorporated appropriate OMB clearance guidelines and standards,
the reports collected by the Board from banking institutions that
are used for supervisory purposes have been exempt since 1942 from
submission to OMB for its approval under the Federal Reports Act.
The banking supervisory reports of the Comptroller of the Currency
and the FDIC also are exempt. The legislative history of the Federal
Reports Act indicates that the exemption was intended to ensure that
the Bureau of the Budget (OMB's predecessor) would not be able to
prohibit the banking agencies from the independent collection of
information with respect to the banks they supervise if they determined
that the direct collection of such data was necessary for the discharge
of their statutory responsibilities. Among the reasons for such
treatment are (1) the sensitivity of much supervisory information
and the integrity of the examination process; (2) the necessity at
times of obtaining information quickly in response to urgent policy
needs; (3) the highly technical content of much of the data that needs
to be obtained; and (4) the fact that many of the data collection
activities and recordkeeping requirements of the Federal banking
agencies are based on specific statutory mandates.
The Board believes that the rationale underlying the current
exemption of banking reports from submission to OMB remains operative.
Retention of the exemption is necessary to ensure the continued and
unhindered capability of the financial institution supervisory agencies
to collect information they regard as essential for maintaining the
soundness of the banking system. Moreover, the Board submits that,
given our own rigorous report clearance and review procedures and our
policy of incorporating OMB standards and guidelines as appropriate,
continuation of the exemption will not result in any loss of effective-
ness in report and burden control. In light of this, involving the
Director of OMB, or the proposed Administrator of an Office of Federal
Information Policy, in the clearance of reports collected from banking
institutions would seem to serve no constructive purpose. At a minimum,
such involvement would raise serious problems in view of the sensitivity
of the data. and would occasion delays that could interfere with the
effective discharge of our responsibilities.
Let me illustrate the kind of policy problems that would
arise with the removal of the current Board exemption. A major
instrument of monetary policy is the setting of reserve requirements.
For example, on October 6, 1979, the,Board, as part of a series of
measures designed to combat inflation and restrain credit, announced
the application of marginal reserve requirements on member banks and
U.S. branches and agencies of foreign banks. Because of financial
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
market sensitivity and the operational needs of monetary policy,
it was necessary that consideration of these changes in reserve
requirements be conducted in great secrecy and that the changes be
implemented promptly on announcement. The Board's October 6 action
required new report forms and changes in existing forms to monitor
and carry out the policy changes. There was no way that the Board
could have cleared those reports through the Director of OMB without
compromising the Board's policy action in one way or another. We
could not have submitted them beforehand because of the extreme degree
of confidentiality involved. Conversely, if we submitted them after
the announcement of the policy action, the reports would not be ready
for the timely distribution from the Reserve Banks to member banks
required for effective implementation of the October action. The
same problem would arise with many reserve requirement actions.
In addition, there are many other developments that occur in the
financial sector requiring prompt statistical inquiry--inquiry that
would be hindered by our coverage under the bill.
I am aware that a section of the proposed bill (3507(b))
contains an "override" provision that would enable the Board, by a
majority vote, to void the Director's disapproval of a proposed
reporting requirement and that another section (3507(e)) would permit
the Director under certain conditions, to "delegate . . . his power
to approve proposed requests in specific program areas, for specific
purposes or for all agency purposes" to the senior official designated
by the agency "to carry out the responsibilities of the agency" as
required in section 3506(b). But neither of these provisions is a
workable substitute for the continuation of the current exemption.
The exercise of the "override" provision could involve a
significant lapse of time since some of the specified procedures for
submitting a request to the Director may be quite time consuming and,
in addition, the Director is given up to 90 days to render his decision.
Such delays could, in crucial policy areas, interfere unduly with the
Board in the discharge of its responsibilities and make the override
provision a meaningless procedure. The purposes of the proposed
legislation could be better served by continuing the present exemption
of the Board but requiring that all Board report actions be approved
by the Board.
Similarly, the "delegation" provision as worded would not
provide the necessary flexibility. The delegation would be made to
a staff member not to the Board. As previously stated, the Board
itself makes the final clearance evaluation and decision on all
reports. Delegating clearance authority to a staff member is
inconsistent with present Board policy and would be an unwarranted
interference in the execution of the Board's responsibilities. Further,
the conditions for delegation--"if the Director finds that (the)
official. . . has independence from any program responsibility and
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has sufficient resources. . ."--and the requirement that the "official. . .
shall comply fully with the rules and regulations promulgated by the
Director" are too restrictive and would also constitute undue inter-
ference by the Director in the internal administration of the Board.
Moreover, use of the delegation provision would be at the discretion
of the Director and there is no certainty as to whether or how it would
be utilized.
Several other provisions of the bill are inappropriate for
application to the Board. H.R. 6410 would grant authority to the
Director in terms so broad as to raise concern that it might result
in unwarranted interference with the Board's statutory responsibilities.
For example, under section 3518, the Board's authority "under any
other law to prescribe policies, rules, regulations, procedures and
forms for Federal information activities" would be "subject to the
authority conferred on the Director". It seems clear to us that this
provision goes beyond a reasonable grant of authority consistent with
the specific purposes of the legislation.
There are other provisions of the bill that also appear
inconsistent with the Board's independent status under the Federal
Reserve Act. For example, several provisions of section 3504 and
section 3513(a) could be regarded as giving the Director some
responsibility for setting and evaluating certain aspects of budget
and management policies for all agencies covered by the bill. This
could interfere with the Board's exercise of its exclusive authority
under the Federal Reserve Act to control its internal operations.
Similarly, section 3515(b) appears to be extremely broad with respect
to the Director's access to information and records in the Board's
possession. As worded, these sections will likely give rise to
problems more serious than those they are intended to solve. Section
3504(c)(2) would substitute the Director's judgment for the Board's
judgment in "determining whether the collection of information is
necessary for the proper performance of the (Board's) functions".
This is not consistent with statutory authority granted to the Board.
There are several specific provisions with respect to privacy
and the availability of data that are of some concern. Although section
3510 does not purport to impose restrictions on the sharing of data
between agencies, there is a possibility that such restrictions could
be imposed by the Director under section 3504(f). That section states
that the privacy functions of the Director shall include "overseeing
the development of the promulgating policies, principles, standards,
and guidelines on information disclosure and confidentiality. . . ."
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Unless the scope of this provision is clarified and restricted,.policies
promulgated pursuant to this provision could conceivably interfere
with the Board's ability to share necessary information concerning
the safety and soundness of financial institutions with the other
federal financial institution supervisojjy agencies. These policies
also could jeopardize the referral of evidence of criminal violations
of law obtained during the course of a bank examination to the
Department of Justice, as authorized by the Right to Financial Privacy
Act. (See 12 U.S.C. ?3412(a) and (d)) In addition, we are concerned
that the language of section 3504 could be construed to apply to
confidential financial transaction data handled by the Federal Reserve
Banks. To the extent that Congress believes that measures are
necessary to ensure confidentiality of such data, we believe that it
should be accomplished through specific legislation and not by the
Director.
In light of the problems that would be entailed in the
application of the bill to the Board and in light of our commitment
to rigorous clearance procedures of our own, the subcommittee may wish
to consider as a substitute for removal of our exemption a provision
requiring exempted agencies to establish appropriate report clearance
and approval procedures that are consistent with the general purposes
of the bill.
I would like also to comment on the provisions of the bill
providing for a Federal Information Locator System to be established
within one year. The bill requires all agencies to submit in a form
specified by the Director descriptive material on all information
requests for inclusion in the System. The use of the System is man-
dated as a necessary part of report clearance procedures and each
agency is obligated to establish procedures to ensure compliance with
the requirements of the System. We have had some experience in related
types of procedures for the description and specification of banking
data, though of course not on the scale mandated here. On the basis
of our experience, it appears that development of a federal information
locator system as comprehensive as that called for by the bill will be
an extremely complicated task. The characteristics of a workable system
and the ways in which it would prove most useful in the report clearance
process may well be quite different from what is envisaged now. We
have been concerned with the enormous costs and difficulties involved
in designing a comprehensive system and in trying to force different
kinds of data into a standard format.
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In this circumstance, we believe that the provisions for the
System might better be stated in more general, tentative and experimental
terms. Considerable developmental work seems called for before such
a sweeping and costly system is mandated, even with the one-year
delay provided in the bill. For example, further experimental work
is needed to determine if the system would be cost-effective in
achieving its stated functions, to investigate whether it might be
more feasible to have separate systems for different families of
statistics that could be tailored to the characteristics of each
family, and to experiment with alternative approaches to a practical
operational system. Consequently, the requirements that each agency
insert into the locator system "a data profile for each information
collection request of each agency" and that each agency ensure compliance
with the system seem to me quite premature.
I would be pleased to answer any additional questions the
Committee may have, and to make the Board's staff available for
technical discussions with the staff of your Subcommittee.
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 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 FEE 2 9
OFFICEOF
THE CHAIRMAN
Congressman Jack Brooks
Chairman, Committee on Government Operations
United States House of Representatives
Washington, D.C. 20510
The Commission is pleased to comment on H.R. 6410, "The
Paperwork Reduction Act of 1980" ("the Bill"). We strongly
support the goal of reducing the paperwork and reporting burdens
on the public. Responding to legitimate expressions of concern
from the business cormunity, many of the Commission's recent
regulatory initiatives have been designed to reduce these kinds
of burdens, especially on small firms. 1/ Thus, we fully support
the provisions of the Bill dealing with inter-agency cooperation
and coordination as appropriate means of pursuing these goals.
We have serious concerns, however, about the provisions of the
Bill that would establish a system of review of the Commission's
information collectior. actions by the office of Management and
Budget. These provisions would be inconsistent with the often
stated Congressional desire to preserve the Commission's policy-
making independence, and could impose burdens and delays on the
f As just one example, the Commission recently simplified regis-
tration and reporting procedures for small businesses through
the adoption of Form S-18. This form is available to certain
domestic and Canadian corporate issuers who are not subject to
the Commission's continuous reporting requirements for the
registration of securities to be sold for cash not exceeding
an aggregate offering price of $5 million. The form calls for
less narrative and financial disclosure than Form S-1, the
standard registration form. The form may be filed with the
regional offices of the Commission, in order to facilitate
handling for the issuer. Also, pursuant to corresponding
amendments to Form 10-K (the annual report for certain
publicly-held companies under the Securities Exchange Act
of 1934),.issuers may include in their initial annual report
information substantially similar to that included in their
Form S-18 registration statement.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
administrative process that outweigh any possible benefits. More-
over, these provisions are needlessly vague in certain respects,
and might be construed to establish a basis for persons subject
to our jurisdiction to disregard or delay essential filing and
reporting requirements mandated or authorized by Congress. Unless
the Bill is changed to meet these concerns, we cannot support
its adoption. In his testimony last November before the Senate
Governmental Affairs Committee on S. 1411, a similar version of
this Bill, Commissioner Evans discussed many of the reasons for
the Commission's position, and our camnents here will largely
restate his testimony.
At the outset, we must emphasize that "information collection"
by government agencies serves many different purposes. Sane informa-
tion is collected purely for research purposes, perhaps with a view
toward consideration of future legislation, rulemaking or other ad-
ministrative action. Other information is collected from regulated
entities for use in enforcing existing law, and to assure that such
entities are not conducting themselves in a manner inconsistent with
the public interest. Finally - and perhaps of most importance to
the Commission - information is collected that forms the basis for
disclosure to the puiSlic. For example, filings pursuant to the
federal securities laws by issuers of securities are designed for
use by persons making investment decisions.
Congress has made the determination that the public is entitled
to complete and accurate disclosure of material information in order
to make informed investment decisions. In collecting information
disclosed by issuers, and by persons subject to our regulatory
jurisdiction, the Commission is assuring that this information is
publicly available, and to a large degree serves simply as a reposi-
tory for data that is intended for the use of the investing public.
In our view, the definition of "collection of information" in
the Federal Reports Act under current law is limited to collection
for statistical purposes, and does not authorize review of disclosure
or enforcement related information gathering. 2/ By contrast, the
f Although the current statutory language is somewhat ambiguous,
the legislative history of the Act makes plain that the scope of
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definition of "collection of information" in Section 3502 of this
Bill, which makes any request for information to ten or more persons
in a standard form subject to the approval provisions of the Bill,
appears to be far more extensive. This expansion of the scope of
the Federal Reports Act is of major concern to us. We do not think
that the purpose of the Bill is, or should be, to subject the Corr
mission's disclosure and enforcement efforts to oversight by the
Office of Management and Budget. We do not believe, for example,
that CNB should determine whether information about possible self-
dealing between corporate officers and the company ought to be
disclosed in a proxy statement. The definition of "collection of
information" is so broad, however, that it could be read as
encompassing this information, which is collected on standard,
statutorily authorized forms. To take another example, in the
course of an enforcement action or an investigation of possible
violations of the securities laws, the Commission staff might
pose identical questions, in written form, to more than ten
persons. Read literally, the Bill would require submission of
these interrogatories to CMB for approval. The disruption of
important Commission activities that could result is obvious.
The over-broad definition of "information collection" is the
basis of our fundamental concern about the possible impact of the
Bill. An independent regulatory agency like the Commission is
currently not, and should not be, subject to policy or procedure
the Act is relatively narrow. Accordingly, the Commission
has taken the position that, within the meaning of the Federal
Reports Act, the Commission does not "conduct or sponsor the
collection of information" in connection with the Commission's
implementation of the disclosure requirements of the federal
securities laws, in connection with the exercise of the Ccaft-
mission's regulatory responsiblity or, generally, in connection
with the Commission's enforcement activities. On the other
hand, to the extent that the Commission gathers information
having primarily statistical significance, the Commission has
always recognized its responsibilities under the Federal
Reports Act.
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
review by the Executive Branch. But on this very point, the Bill
would create substantial confusion. Section 3507 would prohibit
an agency from using a standard form for information collection
unless the Administrator of the Office of Federal Information
Management Policy has approved-the proposed information collec-
tion request. The need to preserve some agency independence is
recognized by providing in subsection (b) that an independent
agency can override the Administrator's decision. On the other
hand, Section 3508, with no provision authorizing the agency to
override his decision, could be read to allow the Administrator,
on his own motion, to prohibit absolutely any information col-
lection activity that he finds "unnecessary, for any reason," or
that it does not have a "practical utility" to the agency. The
relationship between proposed Sections 3507 and 3508 is, at best,
difficult to understand. Y The extensive and apparently un-
limited review power given to OMB under Section 3508 could seem
to make the protections afforded by Section 3507 relatively
meaningless.
Moreover, the standards in Section 3508 demonstrate that it
should not apply to the Commission's requirements for disclosure
to the public. These standards are based on-the Government's
need for the information. But Commission disclosures are based
on the need of the public for the information; the information does
not have "practical utility" to the Commission, but rather to the
public.
There are a number of both practical and policy-related dif-
ficulties with the sort of review authority given by Section 3508
to OMB. It is unlikely that the Administrator of the Office of
Federal Information Management policy would be an expert - or even
particularly familiar - with the field of securities regulation.
f Section 3508 can be read as setting forth the standards to be
used by the Administrator in considering an information collec-
tion requested, and not to affect the authority of the agency,
given in Section 3507, to override a decision by the Adminis-
trator to disapprove that request. The discussion which
follows is based in large part on the assumption that Section
3508 is not conditioned by Section 3507.
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Yet any judgment as to the need for information collected can be
considered only in the context of the agency's full regulatory
program. The Administrator could not develop the expertise
necessary to make such judgments unless he assembled a large staff.
Even then, that staff could not obtain the day-to-day experience
with the workings of the securities industry, and with the ongoing
administration of the federal securities laws and rules thereunder,
that should form the basis of any judgments about the "necessity"
of disclosure and regulatory proposals.
By allowing the Administrator, under the supervision of the
White House, to second-guess decisions about the need for informa-
tion collection, and possibly overrule them on grounds unrelated
to investor protection, the Commission's independence as a regu-
latory agency would be inappropriately impaired. We note that
OMB's power under the Bill is extremely expansive. Section 3508
permits the Administrator to base his decision both on the need
for the information and its "utility" for the agency. OMB is
given rule-making authority to carry out its supervisory func-
tions in Section 3516. And Sections 3518 provides that the
Administrator's authority under the Bill supersedes existing
laws and regulations to the extent that any conflict arises. The
dangers posed by this sort of oversight power are particularly
significant in the Commission's case, since, as noted above,
information collection is the basic means of assuring full dis-
closure of material corporate information, which is the Commission's
primary statutory responsibility.
Moreover, we do not believe that such review would provide any
redeeming benefits. Although designed to streamline the government
process, the Bill paradoxically sets up an additional layer of inter-
agency review that would create additional paperwork and delays in
implementing or continuing regulatory programs. The Commission
usually receives comment from the public on the collection burden
in response to the initial proposal of disclosure rules, and a sub-
sequent hearing would just be unnecessary duplication. In addition,
there could be judicial review of the Administrator's decision, which
also would contribute to disruption and delay. Since approval by
the Administrator has only a two or three year duration, this burden
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would be compounded as agencies continuously submit and resubmit
their rules and requirements for approval. Y
The Commission is also concerned that Section 3512 appears
to allow a reporting entity to refuse to provide information to
the Commission unless the collection of the information has been
authorized under the standards set forth in the Bill. Such a
provision is likely to encourage non-compliance or delay in
fulfilling important regulatory obligations under the pretext
of raising technical or procedural deficiencies in the approval
process.. The federal courts would be forced to decide these
disputes, adding unnecessarily to their dockets. And again, we
must emphasize that the Commission's statutory responsibilites
often depend on information collection.
4f Perhaps our concerns on this point can be illustrated best
through an example. The Commission recently adopted new
simplified registration and reporting obligations for small
businesses through Form S-18. Among other things, this form
requires disclosure through a description of the company's
properties, its business, legal proceedings in which it is
involved, etc. Under the Bill, this form would be reviewed
by OMB. Upon submission, the Administrator might simply
approve the request, thereby confirming the Commission's
judgment. This would merely constitute a delay in the Com-
mission's rule-making effort. On the other hand, he could
decide that such information is not sufficiently material
to investors to warrant the reporting burden. We submit
that the latter sort of judgment is a securities law ques-
tion, not a paperwork question, and is one that the Ad-
ministrator should not be empowered to make. Of course,
our concern here would be alleviated if both Sections 3507
and 3508 make clear that independent agencies can override
the Administrator's decision. But, then, what would the
Bill accomplish, other than delay and additional ad-iinis-
trative burdens and expense, (which, incidentally, will be
paid by the taxpayers)? If the only relevant input from Qt-S
is whether the information can be obtained elsewhere, with
less burden on the public, this can be done through less
cumbersome and disruptive channels.
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In conclusion, it is our belief that although H.R. 6410 may
make sense as a Bill intended to apply to research-type statistical
data, it makes little sense as it applies to information that is
disclosure or enforcement oriented, or to the reporting obliga-
tions of regulated industries imposed by statute. Accordingly,
we strongly recommend that the Bill be amended to narrow the
definition of "collection of information" to exclude reporting
required in connection with statutorily-authorized regulatory,
enforcement or oversight efforts. 5/ In any event, Section 3508
should be revised to permit explicitly an agency to override the
Administrator's decision to prohibit certain information collection
activities, along the same lines as Section 3507, and Section 3512,
dealing with refusal to provide information, should be deleted from
the Bill entirely.
We appreciate this opportunity to present the views of the Com-
mission on this Bill. We hope that these comments have been-useful----
to your Committee. The views expressed here are those of the Commis-
sion, and do not necessarily represent the views of the Administration.
A copy of this letter is being submitted simultaneously to the Office
of Management and Budget, and we will inform you of any further advice
received from the office concerning the views of the Administration.
Harold M. Williams
Chairman
cc: Mr. Bernard Martin
Office of Management and Budget
5/ At the very least, the Bill should make clear that traditional
enforcement activities - gathering information or evidence
pursuant to a subpoena or other process in the course of an
investigatory, adjudicatory or judicial proceeding - are out-
side the scope of the proposal. See 4 C.F.R. ?10.6(c)(4), (5)
(8) (GAO regulations exempting enforcement related information
collection).
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STATEMENT OF
EDWARD J. HANLEY
DEPUTY ASSISTANT ADMINISTRATOR
FOR MANAGEMENT AND AGENCY SERVICES
U.S. ENVIRONMENTAL PROTECTION AGENCY
BEFORE THE
SUBCOMMITTEE ON LEGISLATIONAND
NATIONAL SECURITY
OF THE
COMMITTEE ON GOVERNMENT OPERATIONS
U.S. HOUSE OF REPRESENTATIVES
Mr. Chairman and members of the Subcommittee, I am
Edward J. Hanley, Deputy Assistant Administrator for Management
and Agency Services of the U.S. Environmental Protection Agency.
I welcome the opportunity to meet with you to discuss generally
HR 6410, "The Paperwork Reduction Act of 1980" and, more speci-
fically, EPA's experience in the area of information collection
and management. Let me note at the outset that my responsibili-
ties in EPA include the development and management of the systems
and resources we use to store, process and manage the information
that EPA needs to fulfill its mission.
Information about the environment and the effects on the
environment of specific substances and activities is an abso-
lutely essential resource for EPA. We cannot implement and
enforce the environmental protection laws of this nation without
extensive data collection and analysis. At the same time, we
are well aware of the time and monetary requirements that are
placed upon the public -- both private citizens and business
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337
organizations -- by the sum total of EPA and other government
information requirements. For this reason, we support the
general intent of HR 6410 and, in particular, we endorse the
effort reflected in the bill to clarify accountability within
the.Executive Branch for controlling the paperwork and report-
ing burden imposed by Federal activities. We also endorse the
notion reflected in HR 6410 that the issues concerning Federal.
reporting and paperwork must be addressed as part of a larger
context that also encompasses the processing and management of
information once it has been gathered.
At the same time, there are certain provisions of HR 6410
that may actually undo some of EPA's recent efforts to control
the cost and effectiveness of our informationcollection acti-
vities and to strengthen information management within the
Agency. In fact, certain provisions of the bill would, in our
view, actually confuse rather than clarify Agency accountabil-
ity.
To explain, I would like to first very briefly describe
EPA's information collection activities. Then I shall discuss
the initiatives we have taken to control the cost of these
activities and, equally important, to organize and use the in-
formation efficiently once we have it. I think it will then
be clear that EPA is committed to the goals of HR 6410 and why
we believe that certain specific changes would further these
goals.
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338
EPA collects information for several purposes. First, in
order to develop the regulations mandated by Federal statutes,
we must gather data about sources of both conventional pollu-
tants and the more dangerous toxic substances and other hazar-
dous materials. We must also gather data about the behavior
and effects of these substances once they are released into the
environment. In most cases, EPA's information gathering acti-
vities for regulation development are in the form of special
studies and do not result in substantial direct costs to private
citizens and businesses.
EPA also has responsibility for responding to a variety of
environmental disasters, including spills of toxic and hazardous
materials. In such cases, EPA must collect data from sources
that include local citizens and businesses, to determine the
extent and source of the disaster. Again, the direct cost to
the public is minimal since most such data gathering is per-
formed by EPA and state and local employees or by persons under
contract to these agencies.
Finally, we conduct two types of environmental monitoring.
With assistance from state and local governments, we monitor
the ambient conditions of the air and water to determine the
level of specific substances known to be a hazard to human
health. This ambient monitoring information is essential for
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both the Administrator and the Congress to determine whether
environmental protection statutes and programs are having the
desired effect. In the main, our ambient monitoring networks
are operated using government funds and do not result in major
direct costs to the public.
Finally, EPA monitors specific, regulated sources of pol-
l
lution to determine whether they are in compliance with the
permits issued by EPA, as required by various Federal statutes.
These permits typically specify the amount and type of pollu-
tant a given source or group of sources may release into the
environment. Compliance monitoring obviously is essential if
we are to enforce the Federal statutes and EPA regulations
pursuant to these statutes. Compliance monitoring typically
does impose a direct economic burden since most such-monitor-
ing is accomplished through regulations requiring permitees
to self-monitor and report the results on a regular basis.
Now, I would like to briefly describe how EPA controls the
quality and cost of its information gathering activities, par-
ticularly the compliance monitoring activities that impose a
direct cost on the private sector. Administrator Costle, both
as the head of EPA and in his role as the Chairman of the
Regulatory Council, has placed great emphasis on the govern-
ment's responsibility to weigh both the costs and benefits of
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340
regulations and to seek the least costly regulatory method that
satisfied the intent and requirements of the Federal statutes.
In EPA we have established a formal regulation development pro-
cess that controls the development and issuance of all regula-
tions. Our Steering Committee staff is responsible for ensuring
that proposed regulations presented for approval by the Admini-
strator are accompanied by a careful, statistically valid analysis
of costs, including reporting costs.
The reporting costs imposed on the private sector by EPA
are a function of EPA's regulation development process. we
established the Steering Committee process and staff to control
the quality and cost of our regulations. It is only logical,
we believe, to also assign to the Steering Committee staff the
responsibility for controlling the quality and cost of the re-
porting requirements that are established by our regulations.
Therefore, EPA's statistical policy function was assigned to
the Steering. Committee staff nearly two years ago. More re-
cently, we transferred the reports clearance function to this
same staff as a further step in strengthening our controls over
the cost of EPA regulations.
EPA also has taken a series of steps to improve the infor-
mation collection directly performed or financed by EPA and to
strengthen our management and use of information once we have
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obtained it. I began this statement by saying that information
is a vital resource to EPA. As can be seen from my description
of our data collection activities, EPA's major functions of
regulation development and enforcement are both highly depen-
dent upon the collection and use of increasingly large amounts
of very complex information. We estimate that at present, EPA
spends in excess of $150 million annually to gather and analyze
information.
In years past, some very serious questions were raised
about EPA's monitoring and other major information systems.
The critics, who included both OMB and GAO, challenged whether
and how effectively EPA was managing its information resources.
Immediately upon coming into office, Administrator Costle posed
the same questions. More importantly, Mr. Costle insisted on
obtaining answers to some very penetrating questions about the
environment and the effects of EPA's programs to protect the
environment. After all, the first and most important measure
of any information system is whether it produces useful data.
To obtain answers to these questions, Administrator Costle
initiateda series of studies to determine the scientific and
statistical quality of EPA's existing environmental monitoring
 Approved For Release 2007/05/17: CIA-RDP85-00003R000300050010-5
programs. Based on this study, Mr. Costle issued a policy re-
quiring that all EPA programs conducting environmental monitor-
ing must submit plans for adherence to specific scientific and
statistical standards of quality in the collection and analysis
of data.
Mr. Costle then directed a thorough review of EPA's expen-
ditures for monitoring and other information resources and the
management of these resources. This review showed that, while
EPA spends over $150 million annually to collect and process
data, the Agency did not have the management controls to ensure
that this investment was tied to program priorities or to mea-
sure performance of major information systems. The review also
showed that EPA lacked the critical mass of information spec-
ialists to design and manage vitally needed systems and re-
sources.
To illustrate, we found that EPA had become so dependent
upon contractors to develop and operate major information sys-
tems that, in effect, we were hiring contractors to tell us
what we need, to provide it, and then tell us if we had what
we needed. On average, private industry relies on contractors
for less than 20% of its information systems work; the average
for the Federal government is about 30%. EPA, however, was
over 50% reliant on contractors and headed for 80% in FY 1981.
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343
Actually, our contractors have performed quite well. The
problem is that contractors cannot ensure senior management
attention to the policy issues that are an essential part of
defining information needs and developing any major information
system. Equally important, contractors cannot achieve the inte-
gration of information systems (and therefore-policy) across
organizational and program lines which is essential in any
Federal agency, especially EPA.
Based on this analysis of our internal information manage-
ment capacity, Mr. Costle initiated a number of reforms.
Specifically, he has:
Established a standing committee of Deputy Assis-
tant Administrators, the top career level in EPA,
to oversee all Agency monitoring and information
programs. This committee, which has been assigned
a permanent staff of senior analysts, has authority
to review and approve all EPA monitoring and in-
formation systems, including redirecting resources
where necessary.
? Directed the establishment of a separate zero-
based budgeting process for all information
systems expenditures.
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systems, to provide a data base for use in in-
tegrating existing, redundant systems and pre-
venting duplicative data systems in the future.
? Required a formal audit of all major EPA informa-
tion systems every three to five years, including
a specific determination as to whether each system
is still needed.
EPA recognizes that policy directives and good intentions
are not enough. During FY 1980, the Agency has redirected
positions from within our base to triple the size of our cen-
tral information management staff. In addition, the President's
budget for FY 1981 asks for further increases to be added to
the resources reprogrammed from our base. As a result, we have
stopped the trend of increasing reliance on contractors and
plan to substantially reduce this reliance in the future.
Finally, Mr. Costle has directed the standing committee
to report to him by the end of this fiscal year on the best way
to organize the internal information management responsibili-
ties within EPA. The directions given to the staff preparing
this organizational proposal are in line with HR 6410, with one
important exception -- we had not planned to combine both the
reports clearance/statistical policy functions and the ADP and
related information management functions in one unit.
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This brings me to our first concern regarding HR 6410.
As presently written, the bill appears to require consolida-
tion of the statistical policy and reporting burden function
in the same unit with the internal information management
activities. While these functions in EPA are all assigned to
the Assistant Administrator for Planning and Management, who
reports directly to the Administrator, we feel quite strongly
that they should not be consolidated further and made into
one unit.
It is absolutely essential that the reports clearance/
statistical policy functions be assigned to the staff that
manages our regulation development process. At the same time,
we believe that it would be a mistake to burden this staff
with the very sizable and important internal information man-
agement functions. Instead, we believe that the Assistant
Administrator for Planning and Management should have two
units encompassing all of the functions addressed in HR 6410.
We cannot tell whether HR 6410 would allow what we believe is
a sensible, effective organization for EPA and one that,
after we have completed consolidation of the information man-
agement functions, would achieve the basic aims of the bill.
In addition, HR 6410 appears to eliminate or at least
bring into question the central role of the standing committee
on information management recently established by the
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346
Administrator. We recognize that committees are a suspect form
of organization that are often used to escape accountability.
In EPA's case, we are using the committee to underline the fact
that senior managers across the Agency -- not just the Assistant
Administrator for Planning and Management -- are responsible for
managing information resources. Equally important, the commit-
tee mechanism ensures that information management policy remains
closely tied to program priorities and is not captured by spe-
cialists whose first loyalty may be to their area of technical
interest and expertise.
My basis point is this -- we believe it is unwise to
legislate a specific organizational arrangement that applies
to all agencies. In our case, you may clarify accountability
for information-related activities and end up confusing basic
program accountability for regulation development and enforce-
ment which are EPA's mainstream responsibilities.
As an alternative, we suggest that HR 6410 require agen-
cies to submit a plan to 0MB for organizing and investing in
all of the information management functions specified in the
bill. We believe that the intent of the bill is perfectly
clear and provides OMB a strong mandate to require essential
changes in agency organization and the redirection of agency
resources if necessary to satisfy that intent. The approach
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we are recommending would ensure clear organizational account-
ability for the vital functions addressed in HR 6410 while per-
mitting sufficient flexibility to account for the unique condi-
tions and requirements of individual agencies.
Our second concern has to do with the delegation provi-
sions of HR 6410. We believe that the process as structured
dilutes the responsibility and accountability of agency heads
rather than clarifying it. The Administrator of EPA has a
statutory responsibility to issue and enforce regulations per-
taining to specific activities and substances that Congress
has determined to be damaging to the environment. The Admin-
istrator also is responsible for ensuring that EPA goes about
this in a sensible manner that is cost-effective and techni-
cally sound. The Congress and OMB should hold EPA and other
agencies accountable for meeting these responsibilities and
should limit or revoke agency authority to act only when an
agency demonstrates that it lacks the will or capacity to meet
its responsibilities.
It seems to us that HR 6410 takes the opposite track --
agencies may not have the authority to act on individual re-
porting requirements or ADP procurements until it demonstrates
"capacity." Agencies, like people, are not likely to develop
the. capacity to carry out responsibilities they are not
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permitted to exercise. Moreover, we do not believe that OMB
should routinely review individual reporting requirements
since this is estremely resource intensive and adds steps to
the already lengthy regulation development process. Moreover,
this approach too often ends up raising issues about basic
regulatory strategy in a context that is misleading and can be
procedurally inappropriate.
We believe it would be both more appropriate and sensible
for OMB to conduct periodic reviews of the process by which we
define reporting requirements rather than conducting a de novo
review of each requirement as it is proposed. This approach
has the merit of being more efficient and of focusing OMB's
attention on the right issues. It also clarifies and rein-
forces the notion that agencies are ultimately accountable for
how well they manage. There is much we do not know about man-
aging information resources and costs, and there often will be
room for reasonable people to disagree about the cost-effec-
tiveness of a particular reporting requirement. However, there
is very little my story about what constitutes a sensible
decision-process on reporting requirements and about the level
of management attention these decisions deserve. OMB can quite
readily determine whether an agency is taking seriously its
responsibilities in this area.
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349
Therefore, we suggest that HR 6410 define agency respon-
reasonableness, and technical
and criteria used to set reporting
requirements. If an agency cannot demonstrate that it has
established and systematically enforces an acceptable process
and criteria, 0MB is fully justified in revoking that agency's
authority to issue reporting regulations.
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APPENDIX F.-EXECUTIVE ORDER 12044, MARCH 23, 1978
No. 12044
Mar. 23, 1978, 43 F.R. 12661
IMPROVING GOVERNMENT REGULATIONS
As President of the United States of America, I direct each Executive
Agency to adopt procedures to improve existing and future regulations.
Section 1. Policy. Regulations shall be as simple and clear as pos-
sible. They shall achieve legislative goals effectively and efficiently.
They shall not impose unnecessary burdens on the economy, on indi-
viduals, on. public or private organizations, or on State and local gov-
ernments.
To achieve these objectives, regulations shall be developed through a
process which ensures that:
(a) the need for and purposes of the regulation are clearly estab-
lished;
(b) heads of agencies and policy officials exercise effective over-
sight;
(c) opportunity exists for early participation and comment by other
Federal agencies, State and local governments, businesses, or-
ganizations and individual members of the public;
(d) meaningful alternatives are considered and analyzed before the
regulation is issued; and
(e) compliance costs, paperwork and other burdens on the public
are minimized.
Sec. 2. Reform of the Process for Developing Significant Regulations.
Agencies shall review and revise their procedures for developing regula-
tions to be consistent with the policies of this Order and in a manner
that minimizes paperwork.
Agencies' procedures should fit their own needs but, at a minimum,
these procedures shall include the following:
(a) Semiannual Agenda of Regulations. To give the public ade-
quate notice, agencies shall publish at least semiannually an
agenda of significant regulations under development or review.
On the first Monday in October, each agency shall publish in
the FEDERAL REGISTER a schedule showing the times during'
the coming fiscal year when the agency's semiannual agenda will
be published. Supplements to the agenda may be published at
other times during the year if necessary, but the semiannual
agendas shall be as complete as possible. The head of each
agency shall approve the agenda before it is published.
At a minimum, each published agenda shall describe the regu-
lations being considered by the agency, the need for and the
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legal basis for the action being taken, and the status of regu-
lations previously listed on the agenda.
Each item on the agenda shall also Include the name and tele-
phone number of a knowledgeable agency official and, If pos-
sible, state whether or not a regulatory analysis will be re-
quired. The agenda shall also include existing regulations
scheduled to be reviewed in accordance with Section 4 of this
Order.
(b) Agency Head Oversight. Before an agency proceeds to develop'
significant new regulations, the agency head shall have re-
viewed the issues to be considered, the alternative approaches
to be explored, a tentative plan for obtaining public comment,
and target dates for completion of steps in the development
of the regulation.
(c) Opportunity for Public Participation. Agencies shall give the
public an early and meaningful opportunity to participate In
the development of agency regulations. They shall consider a
variety of ways to provide this opportunity, including (1) pub-
lishing an advance notice of proposed rulemaking; (2) hold-
ing open conferences or public hearings; (3) sending notices
of, proposed regulations to publications likely to be read by those
affected; and (4) notifying Interested parties directly.
Agencies shall give the public at least 60 days to comment on
proposed significant regulations. In the few Instances where
agencies determine this is not possible, the regulation shall be
accompanied by a brief statement of the reasons for a shorter
time period.
(d) Approval of Significant Regulations. The head of each agency,
or the designated official with statutory responsibility, shall
approve significant regulations before they are published for
public comment in the FEDERAL REGISTER. At a minimum,
this official should determine that:
(1) the proposed regulation is needed;
(2) the direct and indirect effects of the regulation have been
adequately considered;
(3) alternative approaches have been considered and the least
burdensome of the acceptable alternatives has been chosen;
(4) public comments have been considered and an adequate
response has been prepared;
(5) the regulation is written in plain English and is under-
standable to those who must comply with it;
(6) an estimate has been made of the new reporting burdens or
recordkeeping requirements necessary for compliance with
the regulation;
(7) the name, address and telephone number of a knowledge-
able agency official is included In the publication; and
(8) a plan for evaluating the regulation after its issuance has
been developed.
(e) Criteria for Determining Significant Regulations. Agencies
shall establish criteria for identifying which regulations are
significant. Agencies shall consider among other things: (1)
the type and number of individuals, businesses, organizations,
State and local governments affected; (2) the compliance and
reporting requirements likely to be involved; (3) direct and
indirect effects of the regulation including the effect on compe-
tition; and (4) the relationship of the regulations to those of
other programs and agencies. Regulations that do not meet an
agency's criteria for determining significance shall be accom-
panied by a statement to that effect at the time the regulation
is proposed.
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Sec. S. Regulatory Analysis. Some of the regulations identified as
significant may have major economic consequences for the general econo-
my, for individual 'industries, geographical regions-or levels of govern-
ment. For these regulations, agencies shall prepare a regulatory analysis.
Such an analysis shall involve a careful examination of alternative ap-
proaches early in the decision-making process.
The following requirements shall govern the preparation of regulatory
(a) Criteria. Agency heads shall establish criteria for determining
which regulations require regulatory analyses. The criteria
established shall:
(1) ensure that regulatory analyses are performed for all regu-
lations which will result In (a) an annual effect on the
economy of $100 million or more; or (b) a major In-
crease in costs or prices for individual Industries, levels
of government or geographic regions; and
(2) provide that In the agency head's discretion, regulatory
analysis may be completed on any proposed regulation.
(b) Procedures. Agency heads shall establish procedures for
developing the regulatory analysis and obtaining public com-
ment. .
(1) Each regulatory analysis shall contain a succinct state-
ment of the problem; a description of the major alterna-
tive ways of dealing with the problems that were considered
by the agency; an analysis of the economic consequences
of each of these alternatives and a detailed explanation of
the reasons for choosing one alternative over the others.
(2) Agencies shall include in their public notice of proposed
rules an explanation of the regulatory approach that has
been selected or is favored and a short description of the
other alternatives considered. A statement of how the
public may obtain a copy of the draft regulatory analysis
shall also be included.
(3) Agencies shall prepare a final regulatory analysis to be
made available when the final regulations are published.
Regulatory analyses shall not be required In rulemaking proceedings
pending. at the time this Order Is issued if an Economic Impact Statement
has already been prepared in accordance with Executive Orders 11821
and 11949.
Sec. 4. Review of Existing Regulations. Agencies shall periodically
review their existing regulations to determine whether they are achieving
the policy goals of this Order. This review will follow the same pro-
cedural steps outlined for the development of new regulations.
In selecting regulations to be reviewed, agencies shall consider such
criteria as:
(a) the continued need for the regulation;
(b) the type and number of complaints or suggestions received;
(c) the burdens Imposed on those directly or Indirectly affected by
the regulations;
(d) the need to simplify or clarify language;
(e) the need to eliminate overlapping and duplicative regulations;
and
(f) the length of time since the regulation has been evaluated or
the degree to which technology, economic conditions or other
factors have changed In the area affected by the regulation.
Agencies shall develop their selection criteria and a listing of possible
regulations for Initial review. The criteria and listing shall be published
for comment as required in Section 5. Subsequently, regulations selected
for review shall be included in the semiannual agency agendas.
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Sec. 5. Implementation.
(a) Each agency shall review its existing process for developing
regulations and revise it as needed to comply with this Order.
Within 60 days after the issuance of the Order, each agency
shall prepare a draft report outlining (1) a brief description
of its process for developing regulations and the changes that
have been made to comply with this Order; (2) its proposed
criteria for defining significant agency regulations; (3) its
proposed criteria for identifying which regulations require
regulatory analysis; and (4) its proposed criteria for selecting
existing regulations to be reviewed and a list of regulations
that the agency will consider for its initial review. This re-
port shall be published in the FEDERAL REGISTER for public
comment. A copy of this report shall be sent to the Office of
Management and Budget.
(b) After receiving public comment, agencies shall submit their
revised report to the Office of Management and Budget for
approval before final publication in the FEDERAL REGISTER.
(c) The Office of Management and Budget shall assure the ef-
fective implementation of this Order. OMB shall report at
least semiannually to the President on the effectiveness of the
Order and agency compliance with its provisions. By May 1,.
1980, OMB shall recommend to the President whether or not
there is a continued need for the Order and any further steps
or actions necessary to achieve its purposes.
Sec. 6. Coverage.
(a) As used in this Order, the term regulation means both rules and
regulations issued by agencies including those which establish
conditions for financial assistance. Closely related sets of regu-
lations shall be considered together.
(b) This Order does not apply to:
(1) regulations issued in accordance with the formal rulemaking
(3) matters related to agency management or personnel;
(4) regulations related to Federal Government procurement;
(5) regulations issued by the independent regulatory agencies;
provisions of the Administrative Procedure Act (5 U.S.C.
556, 557);
or
regulations that are issued in response to an emergency or
which are governed by short-term statutory or judicial
deadlines. In these cases, the agency shall publish In the
FEDERAL REGISTER a statement of the reasons why it is
impracticable or contrary to the public interest for the
agency to follow the procedures of this Order. Such a
statement shall include the name of the policy official
responsible for this determination.
This Order is intended to improve the quality of Executive
Agency regulatory practices. It is not intended to create delay in the
process or provide new grounds for judicial review. Nothing In this
Order shall be considered to supersede existing statutory obligations gov-
erning rulemaking.
Sec. 8. Unless extended, this Executive Order expires on June 30,
1980.
THE WHITE HOUSE,
March 23, 1978.