[House Hearing, 105 Congress]
[From the U.S. Government Publishing Office]



 
 GOVERNMENT PERFORMANCE AND RESULTS ACT IMPLEMENTATION: HOW TO ACHIEVE 
                             RESULTS
=======================================================================

                                HEARINGS

                               before the

                 SUBCOMMITTEE ON GOVERNMENT MANAGEMENT,
                      INFORMATION, AND TECHNOLOGY

                                 of the

                              COMMITTEE ON
                           GOVERNMENT REFORM
                             AND OVERSIGHT
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED FIFTH CONGRESS

                             FIRST SESSION
                               __________

                         MARCH 10 AND 13, 1997
                               __________

                           Serial No. 105-31
                               __________

Printed for the use of the Committee on Government Reform and Oversight








                     U.S. GOVERNMENT PRINTING OFFICE
42-636                       WASHINGTON : 1997
________________________________________________________________________
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              COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT

                     DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York         HENRY A. WAXMAN, California
J. DENNIS HASTERT, Illinois          TOM LANTOS, California
CONSTANCE A. MORELLA, Maryland       ROBERT E. WISE, Jr., West Virginia
CHRISTOPHER SHAYS, Connecticut       MAJOR R. OWENS, New York
STEVEN SCHIFF, New Mexico            EDOLPHUS TOWNS, New York
CHRISTOPHER COX, California          PAUL E. KANJORSKI, Pennsylvania
ILEANA ROS-LEHTINEN, Florida         GARY A. CONDIT, California
JOHN M. McHUGH, New York             CAROLYN B. MALONEY, New York
STEPHEN HORN, California             THOMAS M. BARRETT, Wisconsin
JOHN L. MICA, Florida                ELEANOR HOLMES NORTON, Washington, 
THOMAS M. DAVIS, Virginia                DC
DAVID M. McINTOSH, Indiana           CHAKA FATTAH, Pennsylvania
MARK E. SOUDER, Indiana              TIM HOLDEN, Pennsylvania
JOE SCARBOROUGH, Florida             ELIJAH E. CUMMINGS, Maryland
JOHN B. SHADEGG, Arizona             DENNIS J. KUCINICH, Ohio
STEVEN C. LaTOURETTE, Ohio           ROD R. BLAGOJEVICH, Illinois
MARSHALL ``MARK'' SANFORD, South     DANNY K. DAVIS, Illinois
    Carolina                         JOHN F. TIERNEY, Massachusetts
JOHN E. SUNUNU, New Hampshire        JIM TURNER, Texas
PETE SESSIONS, Texas                 THOMAS H. ALLEN, Maine
MICHAEL PAPPAS, New Jersey                       ------
VINCE SNOWBARGER, Kansas             BERNARD SANDERS, Vermont 
BOB BARR, Georgia                        (Independent)
------ ------
                      Kevin Binger, Staff Director
                 Daniel R. Moll, Deputy Staff Director
                       Judith McCoy, Chief Clerk
                 Phil Schiliro, Minority Staff Director
                                 ------                                

   Subcommittee on Government Management, Information, and Technology

                   STEPHEN HORN, California, Chairman
PETE SESSIONS, Texas                 CAROLYN B. MALONEY, New York
THOMAS DAVIS, Virginia               PAUL E. KANJORSKI, Pennsylvania
JOE SCARBOROUGH, Florida             MAJOR R. OWENS, New York
MARSHALL ``MARK'' SANFORD, South     ROD R. BLAGOJEVICH, Illinois
    Carolina                         DANNY K. DAVIS, Illinois
JOHN E. SUNUNU, New Hampshire
------ ------

                               Ex Officio

DAN BURTON, Indiana                  HENRY A. WAXMAN, California
                   J. Russell George, Staff Director
                 Anna Miller, Professional Staff Member
                Mark Uncapher, Professional Staff Member
                 John Hynes, Professional Staff Member
                          Andrea Miller, Clerk
           David McMillen, Minority Professional Staff Member
          Mark Stephenson, Minority Professional Staff Member









                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    March 10, 1997...............................................     1
    March 13, 1997...............................................    83
Statement of:
    Giuliani, Rudolph W., mayor, New York City...................    92
    Robinson, Dwight P., Deputy Secretary, Department of Housing 
      and Urban Development; John Dyer, Acting Principal Deputy 
      Commissioner, Social Security Administration, accompanied 
      by Carolyn Shearin Jones, Director of the Office of 
      Strategic Management; and Ron Stewart, Acting Deputy Chief, 
      U.S. Department of Agriculture Forest Service..............    42
    Stevens, L. Nye, Director, Federal Management and Workforce 
      Issues, General Government Division, U.S. General 
      Accounting Office, accompanied by J. Christopher Mihm, 
      Assistant Director, Federal Management and Workforce 
      Issues, General Government Division, U.S. General 
      Accounting Office..........................................     4
Letters, statements, etc., submitted for the record by:
    Dyer, John, Acting Principal Deputy Commissioner, Social 
      Security Administration, prepared statement of.............    51
    Giuliani, Rudolph W., mayor, New York City:
        Charts concerning crime in New York City.................    94
        Information concerning the fingerprinting program........   114
        Prepared statement of....................................   106
    Horn, Hon. Stephen, a Representative in Congress from the 
      State of California, prepared statement of.................    85
    Maloney, Hon. Carolyn B., a Representative in Congress from 
      the State of New York, prepared statement of...............    89
    Robinson, Dwight P., Deputy Secretary, Department of Housing 
      and Urban Development, prepared statement of...............    44
    Stevens, L. Nye, Director, Federal Management and Workforce 
      Issues, General Government Division, U.S. General 
      Accounting Office, prepared statement of...................     7
    Stewart, Ron, Acting Deputy Chief, U.S. Department of 
      Agriculture Forest Service:
        Information concerning timber receipts returned to the 
          Treasury...............................................    74
        Prepared statement of....................................    60








 GOVERNMENT PERFORMANCE AND RESULTS ACT IMPLEMENTATION: HOW TO ACHIEVE 
                                RESULTS

                              ----------                              


                         MONDAY, MARCH 10, 1997

                  House of Representatives,
Subcommittee on Government Management, Information, 
                                    and Technology,
              Committee on Government Reform and Oversight,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10 a.m., in 
room 311, Cannon House Office Building, Hon. Stephen Horn 
(chairman of the subcommittee) presiding.
    Present: Representatives Horn, Sessions, and Davis of 
Virginia.
    Staff present: J. Russell George, staff director; Anna 
Miller and John Hynes, professional staff members; Andrea 
Miller, clerk; and David McMillen and Mark Stephenson, minority 
professional staff members.
    Mr. Horn. A quorum being present in a few minutes, the 
Subcommittee on Government Management, Information, and 
Technology will come to order. This morning we are holding an 
oversight hearing on the implementation of the Results Act, the 
official name being the Government Performance and Results Act, 
or GPRA, as some call it.
    Today, we will examine the status of the consultation 
process required under the Government Performance and Results 
Act.
    From now until August, executive branch agencies will be 
consulting with Congress and other stakeholders on the contents 
of their strategic plans. They will explain how the goals and 
objectives in the plans have been developed, whether those 
goals and objectives are consistent with their mission 
statements, and how they plan to measure achievement toward 
those goals.
    These plans will provide the framework for agency 
management to examine activities throughout the organization, 
helping to ensure that all activities relate to and promote the 
agency's basic mission. To Congress this is an opportunity for 
broad discussions about an agency's overall direction and 
program priorities.
    Today, the subcommittee is going to examine what the 
consultation process will actually involve. The General 
Accounting Office will describe what Congress and the agency 
should expect from the consultation process. And I might add 
that we will ask our friends from the General Accounting Office 
to sit with the panels as they follow because I would like your 
reaction as we go through this.
    We will also hear from three agencies, the Department of 
Housing and Urban Development, the Social Security 
Administration, and the Forest Service. Representatives from 
these agencies will discuss how they are preparing to consult 
with their committees of jurisdiction and describe their plans 
for full Government Performance and Results Act implementation. 
All three of these agencies were early pilots of that law. The 
Department of Housing and Urban Development has used 
performance reporting to monitor the success of its programs 
since fiscal year 1994. The Social Security Administration has 
been reporting on performance for 2 years in its accountability 
report.
    This reporting covers a wide range of measures for 
disability and appeals-related performance outputs and 
outcomes. The Forest Service has been preparing strategic plans 
every 5 years since 1974 and preparing an annual report of 
accomplishments under the Forest and Ranges Lands Renewable 
Resources Planning Act of 1974.
    One of the difficulties in measuring performance in the 
Federal Government is the wide variation among agencies in 
their means of delivery and services to taxpayers. Agencies 
such as Housing and Urban Development are grantmaking 
organizations, passing out funds to States, not-for-profit 
organizations, local governments, and other entities.
    In such cases, non-Federal entities control final delivery 
to the end user. Other agencies, such as the Social Security 
Administration, provide benefits directly to recipients. Still 
others, such as the Forest Service, provide indirect benefits. 
The Forest Service protects the natural environment and 
maintains natural resources so that Americans can enjoy their 
heritage. They also build roads into the national forest that 
permit those that are logging trees to gain access to parts of 
the national forest.
    These differences influence how desired outcomes are 
measured. A grantmaking agency, such as the Department of 
Housing and Urban Development, must design partnership 
agreements with its service providers to ensure that providers 
measure their performance and outcomes. An agency that provides 
benefits directly can measure outcomes and qualities of service 
much more directly. However, it must deal with competing 
priorities. Does it satisfy the customer at the expense of 
accuracy? Does it focus on service or stewardship? Which comes 
first, customer service or accountability?
    The Forest Service must pursue goals that come to fruition 
very slowly and cope with multiple stakeholders that have a 
variety of needs. And our question will be, how do you measure 
success when it takes years for a tree to grow? The bottom line 
is that agencies must grapple with these and other difficulties 
of measuring performance.
    The incentive is that an informed awareness of performance 
brings tangible benefits. Agencies will be able to identify 
programs that are inefficient, underperforming or even 
obsolete. Congress and other stakeholders will benefit from 
improved performance and greater results.
    Another challenge for Congress is how to coordinate the 
Government Performance and Results Act consultation process. 
The leadership of the House has established teams coordinated 
by Representative Burton, the chair of our full committee, 
Representative Kasich, chairman of the Budget Committee, and 
Representative Livingston, the chair of the Appropriations 
Committee and its various subcommittees.
    The teams consist of staff members from different 
committees. They will facilitate discussions and attempt to 
resolve disagreements over priorities. It is important to 
understand that the team concept is not intended to prevent any 
Members or staff from seeking consultation from any agency. It 
is primarily intended as an oversight tool to promote a 
consensus where there are competing goals or priorities. 
Simply, the agency should be consulting with stakeholders 
outside of the Federal Government who will also have divergent 
interests and preferences.
    While this is a challenging process, it is thoroughly 
worthwhile and we need to get information about it. Experiments 
undertaken by States, local governments, and other countries, 
have produced excellent results. At the end of our session 
today, we will recess this hearing until Thursday, March 13th 
in order to hear about one of those success stories.
    The mayor of New York, the Honorable Rudolph Giuliani, will 
testify on how New York City, and especially the New York City 
Police Department, has been reformed by the same principles 
that are embodied in the Federal Government Performance and 
Results Act.
    We hope that this legislation will result in similar 
success stories at the Federal level.
    Today's hearing includes several witnesses commenting on 
the implementation of the act. Appearing today are Mr. Nye 
Stevens, Director, Federal Management and Workforce Issues, 
General Government Division, U.S. General Accounting Office, 
accompanied by Assistant Director Chris Mihm.
    We will hear their expert opinion on how the consultation 
process is going. Then we will have testimony from a panel of 
experts, who will bring us up-to-date on how their agencies are 
complying with the law.
    Those witnesses will be Dwight Robinson, the Deputy 
Secretary, Department of Housing and Urban Development; John 
Dyer, Acting Principal Deputy Commissioner of the Social 
Security Administration; accompanied by Carolyn Shearin Jones, 
Director of the Office of Strategic Management; and Ron 
Stewart, Acting Deputy Chief, Programs and Legislation, the 
U.S. Department of Agriculture's Forest Service.
    We thank you all for joining us. We look forward to your 
testimony.
    I would like to ask the gentleman from Virginia, Mr. Davis, 
if he would like to make an opening statement?
    Mr. Davis of Virginia. I will be very brief. I appreciate 
you holding these hearings. I think the Government Performance 
and Results Act offers great potential and possibilities for 
enabling Government to work better and more efficiently. As we 
try to define the congressional oversight role in this, I think 
these hearings are going to be very helpful to us. And I would 
associate myself with the remarks expressed by the chairman 
earlier and look forward to today's hearing. Thank you.
    Mr. Horn. I thank the gentleman for his comments. And now, 
as you know, being regular witnesses here, we do swear in all 
witnesses before their testimony is given. Once they have been 
sworn in, their written statement is put in the record. We 
would appreciate it if you would summarize the high points of 
your statement and we will move right along.
    As I said earlier, for those who have entered later, that 
the gentlemen from the General Accounting Office will continue 
to sit with the witnesses and we would appreciate their 
comments at various points, certainly, at the end of the 
hearing or during the testimony. So if you would rise and raise 
your right hand.
    [Witnesses sworn.]
    Mr. Horn. The clerk will note that both witnesses have 
affirmed. Please begin, Mr. Stevens.

STATEMENTS OF L. NYE STEVENS, DIRECTOR, FEDERAL MANAGEMENT AND 
  WORKFORCE ISSUES, GENERAL GOVERNMENT DIVISION, U.S. GENERAL 
    ACCOUNTING OFFICE, ACCOMPANIED BY J. CHRISTOPHER MIHM, 
 ASSISTANT DIRECTOR, FEDERAL MANAGEMENT AND WORKFORCE ISSUES, 
  GENERAL GOVERNMENT DIVISION, U.S. GENERAL ACCOUNTING OFFICE

    Mr. Stevens. Thank you very much, Mr. Chairman.
    After 3\1/2\ years of planning and preparation and pilots 
and perhaps a few instances of procrastination, we are finally 
entering that stage in the implementation of the Government 
Performance and Results Act where every agency in the executive 
branch has to produce something tangible, a strategic plan that 
sets forth its mission and goals and its strategies for meeting 
those goals.
    Agency strategic plans are due to be submitted to Congress 
at the end of September of this year, and the law requires that 
agencies develop them in consultation with Congress and in 
soliciting the views of other stakeholders in the agency's 
mission. The consultations are just now beginning to take 
place.
    Of the 24 largest executive branch agencies, only 4 
departments and 7 independent agencies have done any 
consultations at all, and most of those were done because 
congressional committee staff called up the agencies and asked 
them to come rather than at the agency's initiative.
    We interviewed participants in most of those meetings at 
the request of the House Budget Committee chairman. The 
participants we interviewed on both sides characterized the 
meeting so far not as real consultations on GPRA, but more as 
briefings or pre-consultations or preliminary consultations.
    While both committee staff and agency officials had 
generally positive comments about these meetings, they stressed 
the point that it is going to take time and considerably more 
experience before a coherent specific set of best practices for 
these meetings emerges.
    Instead, they suggested some general approaches to 
successful consultations that center on the creation of shared 
expectations between committees and agencies. Because Mr. 
Chairman, this is new ground. The consultations entail a very 
different working relationship between the branches of 
Government that has generally prevailed in the past.
    You are familiar with previous executive branch attempts to 
initiate linking results with resources like PPBS, the Planning 
Programming Budgeting System under President Johnson, and MBO, 
under the Nixon administration, and the zero-based budgeting 
initiative.
    One of the principal defects of these, the reasons they 
failed to take hold for the long run, was that they ignored the 
need for constructive, candid communication and shared goals 
across the branches of Government, a failing that was 
recognized very well by the authors of the Government 
Performance and Results Act.
    Creating shared expectations was identified as an essential 
starting point for successful consultations in our interviews. 
Several of the less successful experiences, so far, stem from 
the failure to define up front what both sides expect to 
achieve from their discussions.
    With this perspective, the letter of February 25th from the 
congressional leadership to OMB represents an excellent step 
forward in establishing generic expectations for the content of 
the strategic plans and for the type of topics that the 
leadership expects will often come up in the meetings 
themselves. All of our interviews preceded this letter, of 
course, and were not informed by the generally comprehensive 
guidance that it provides.
    At the same time, both committee staff and the agency 
officials we interviewed stress that consultations ultimately 
must be tailored to individual committees, to their needs, 
their varying knowledge levels and to the degree of policy 
agreement or disagreement that exists both within Congress and 
between Congress and the administration on strategic issues.
    The need to anticipate and address differing views of what 
is to be discussed was a recurrent theme in our interviews. In 
general, we found that congressional staff wanted a deeper 
examination of the details of agency's strategic plans and 
frequently issues related to specific programs than the 
agencies were predisposed to engage in. They wanted more 
commonly to keep discussions at a higher level on missions and 
strategies rather than specific program issues.
    While GPRA does not resolve this difference, recognizing 
that it exists and addressing it directly is most likely to 
lead to fruitful discussions and to avoid miscommunication or 
talking past each other from the outset.
    Another key consideration that emerged is the importance of 
engaging the right people in these discussions. Almost everyone 
we talked with stressed the importance of having program people 
from the agencies in the consultations, as well as officials 
with the authority to revise the agency's strategic plan.
    To be successful, it's generally recognized that GPRA can't 
be a staff-driven exercise, but must be the basis for daily 
operations within the agencies, and those with authority over 
those operations need to be involved in the discussions over 
the plans.
    And similarly, congressional staff that we interviewed 
noted that true consultation can't take place without 
eventually engaging Members. The fact that a number of 
committees are planning hearings this spring to provide 
oversight on agency GPRA efforts is certainly a good sign in 
that respect.
    And finally, as was recognized in the congressional 
leadership letter, it was clear to everyone involved in the 
consultations to date that they have begun what has to be a 
long-term iterative process that is going to take a good deal 
of time to bring to completion. As one agency official put it, 
to be useful, the strategic plan must be viewed as a dynamic 
document subject to change and open to criticism by all 
participants in the process.
    That is a summary of our statement, Mr. Chairman; Mr. Mihm 
and I can respond to any questions you have on it, or other 
aspects of GPRA.
    [The prepared statement of Mr. Stevens follows:]
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    Mr. Horn. I appreciate having that summary and your more 
thorough and complete written document was submitted. As I 
said, that will be part of the record. And besides the 
questions Members of the panel have, we may well be sending you 
some written questions in the interest of time.
    I now yield to our distinguished vice chairman to begin the 
questioning, Mr. Sessions of Texas.
    Mr. Sessions. Mr. Chairman, thank you so much. Mr. Stevens, 
Mr. Mihm, thank you so much for taking the time to be with us 
today.
    As a person who is concerned about the discussion that you 
just enlightened us on, and that is GPRA, and how the agencies 
are looking at this, I heard you say that they are just now 
looking at a response and a mechanism and putting in place 
those mechanisms to respond to this. Is that what you are 
saying?
    Mr. Stevens. As far as implementation of GPRA as a whole is 
concerned, there is a great degree of variability. Some 
agencies have been engaged in pilot programs for a number of 
years.
    What I was referring specifically to was the consultation 
process with Congress. That is only just beginning, and there 
have only been a few very sporadic consultations really done at 
the instigation of Congress rather than the agencies itself.
    Mr. Sessions. We are, I believe, trying to look at how 
important this is on a going-forth basis to determine from a 
perspective of an agency what their mission statement is to 
their authority given in laws.
    Do you have any examples of perhaps an agency that has a 
mission statement or things that they do that are not related 
to that authority that they have been given in statutes?
    Mr. Stevens. There are some agencies, Mr. Sessions, that do 
not have organic statutes. I am familiar, for example, with the 
Federal Emergency Management Agency, which was established by a 
reorganization plan in the early 1980's, and that was a 
conglomeration of program responsibilities collected from a 
number of departments; and to my knowledge, they have never 
been encapsulated in an overall statement of the mission of the 
agency. They generally had to package those responsibilities in 
a mission statement of their own.
    I think the Environmental Protection Agency is in the same 
boat, they never had an organic statute. What they've had is a 
dozen or so very important laws they are responsible for 
carrying out, some of which are clearer than others, some of 
which are in conflict. They have had to balance that and GPRA 
is certainly forcing them to do so.
    Mr. Sessions. Do you believe that they are responsibly 
looking inward at that themselves when they try to respond, or 
have you had any particular contact with these two agencies?
    Mr. Stevens. With those two agencies?
    Mr. Sessions. Yes.
    Mr. Stevens. Mr. Mihm had closer contact with both than I 
have.
    Mr. Mihm. In the case of FEMA, we have done some work now 
probably about 1\1/2\ years ago looking at how they changed 
their program operations to be more consistent with what they 
understood their mission to be. We did not do a legal scrub to 
see if it was consistent with any statute, though. We looked at 
generally how they are seeking to become more effective within 
what they define and what they understand to be their legal 
mission.
    In the case of the Environmental Protection Agency, we have 
also done work there and have found similar challenges in that 
they are less concerned with trying to get an overall or 
overarching organic legislation, and are concerned with how do 
they balance off the competing demands that are placed upon 
them by different legislative requirements.
    And this is the type of issue, Mr. Sessions, that we are 
seeing in agency, after agency, even those that do have organic 
legislation. Over time, as new social and economical problems 
have arisen, we've put new responsibilities on agencies without 
going back and doing an examination and seeing if the sum total 
of what we are doing, leads to overall irrationality.
    There is a real need to do this examiniation in agency 
after agency. We encourage them that this is one of the 
starting points of congressional consultation to go up there 
and say, this is the sum total of the demands that are put on 
us that we see legislatively. Here are the priorities that we 
are setting. Give us guidance, Congress, on how best to adjust 
those priorities and balance them off against one another.
    Mr. Sessions. It's interesting that your comments relate to 
FEMA. Without trying to pick on FEMA, I saw in last week's 
newspaper a discussion about how they are spending millions of 
dollars to save some golf courses that may be in harm's way 
either as a result of floods or other things. And it seems like 
that somewhere inherent within their either; A, mission 
statement or that the authority that they have through statutes 
that they would recognize whether they should or should not be 
spending taxpayer money protecting a golf course, which 
probably is a private asset. Very interesting.
    Let's get to the larger scheme of things, and that is to 
the Department of Defense, if we could. Where are they in this 
process, and specifically, responding to the June and then the 
September deadline?
    Mr. Mihm. We recently sent over a series of questions to 
the Department of Defense and are waiting for the answers back 
on those. And, so, it is going to be somewhat tentative until 
we get those answers back and then do an assessment for you and 
your colleagues up here on the Hill.
    In essence, we have just concluded a pretty high level 
examination in which we found two things. First, is that they 
had made some pretty good progress in establishing corporate 
wide goals. That's what they call their strategic goals, and 
they had a half dozen or seven of those that they laid out that 
would be the overall goals for the Department.
    Where they have made less progress and what our questions 
were centered on was how do they link the activities that are 
done on a day-to-day basis by military services and defense 
agencies to the attainment of those strategic goals or 
corporate goals? They really weren't there yet. And there's a 
couple of reports that we've issued just within the last 6 
months in which we laid out some real concerns.
    First, in the logistics area, we had laid out concerns 
showing that while the Defense Logistics Agency was making some 
progress in its own area of trying to get a handle on the 
logistics issues, there was not a real linkage back up to an 
overall strategic vision for the Department of what do we need 
and when do we need it and where are we going to get it? And I 
know questions of logistics and excess capacity have been a 
major concern of the Congress generally and of members of this 
subcommittee, in particular.
    Second, we had done a report recently that had looked at 
the information technology and all the tens of billions of 
dollars that they procure each year in information technology, 
and technology generally to make sure that that was linked up 
to a broader vision, a broader strategic vision of what are we 
trying to achieve in the Department of Defense.
    The absence of these linkages, or rather the questions 
about the extent to which these linkages exist, what do you 
spend in working on day-to-day; what is that achieving at a 
corporate level is something that is a real concern for us; and 
we have probed the Department of Defense on that and are 
expecting some answers back very shortly.
    Mr. Sessions. Then, last, I would just ask, Mr. Chairman, 
and then I would yield back to you about the gathering of data 
and information perhaps in DOD, perhaps because they are the 
largest and perhaps the one that would be more suspect, but do 
you believe that these agencies have the ability to gather 
correct, timely, and accurate data?
    Mr. Stevens. Mr. Sessions, certainly few, if any, do now. 
And when Mr. Hinchman testified before the full committee on 
February 12th, he made this a general point about Government 
agencies. It certainly applies to DOD perhaps because it is the 
largest of any other, and that is that they do not yet have the 
kinds of data on what their programs cost and what kinds of 
results they can expect from them to be able to fully meet the 
requirements of the Government Performance and Results Act or 
of the CFO Act, the Chief Financial Officers Act. GAO is 
placing a good deal of hope that in tandem those two acts can 
eventually provoke agencies to provide that data.
    But I also say Congress has its part. Because if Congress 
does not use that data, does not make decisions based upon it, 
does not show that it is willing to look hard at performance, 
it is ultimately not going to get the attention that agencies 
need to devote to it for them to improve those underlying 
systems.
    Mr. Sessions. In other words, we have to pay attention--
since we have asked the question, we need to pay attention and 
have the willpower to move forward.
    Mr. Stevens. Yes, sir.
    Mr. Sessions. Thank you, Mr. Chairman.
    Mr. Horn. I thank the gentleman. I now recognize the 
gentleman from Virginia, Mr. Davis, for 10 minutes.
    Mr. Davis of Virginia. Mr. Chairman, thank you very much. I 
guess the cynics in Government would look at this and go back 
to the Johnson administration's program planning and budget 
system, the Nixon administration's management MBOs and, as you 
note here, the Carter administration zero-based budgeting, and 
none of these efforts were really successful, but they really 
didn't entail congressional oversight at the time that is 
contemplated in this act and they weren't legislative mandates.
    Mr. Stevens. Those are certainly critical differences, Mr. 
Chairman. We are preparing a report now that should be out 
certainly by the end of the month, which contrasts GPRA with 
those previous initiatives, and those are two of the 
conclusions.
    Mr. Davis of Virginia. What are some of the conclusions you 
might come up with? I don't want to jump the reporting gun on 
this, but it seems to me--those jumped out at me because these 
are legislatively mandated and the culture, it seems to me, in 
the administrations, Republican and Democrat, but kind of the 
culture, the nature of bureaucracy itself kind of hold the 
legislative process at bay and they tend to do their own thing, 
kind of resent legislative influence.
    Mr. Stevens. Certainly, the authors of GPRA recognized that 
ultimately a much more cooperative approach to management 
improvement was needed between the two branches, that there 
needed to be some joint ownership of these programs, and that 
the failing of those previous programs where they were from one 
administration, it was their initiative. They kind of sent it 
up to Congress and left it there and they did not followup on 
it.
    I think another key difference was one Mr. Sessions touched 
on, and that is, there is a recognition now of the need of 
basic underlying information systems to provide the kind of 
data that you really need to determine whether your programs 
are having results or not.
    The consultation process, as you mentioned, Mr. Davis, is 
one of the mechanisms within GPRA that is designed to achieve a 
greater degree of consensus over what agencies are doing than 
we have now, and I think it was very farsighted in that 
respect.
    Mr. Davis of Virginia. It just seems the nature of 
Government itself, certainly the congressional level, it is 
very short cyclically. You go from 2 years in the House--I 
mean, I don't want to give any inside secrets, but you have got 
to look at every 2 years. This is what is going to happen at 
the end of 2 years. And this act really provides for a longer 
term point of view, a longer term setting of priorities, and 
administrations aren't used to that. They are kind of in a 4-
year cycle. Congresses are in 2-year or 6-year or whatever 
cycles. And this is a great challenge, I think, to both sides 
to try to get the information, share it together.
    Up here it looks like our greatest challenge is we have a 
committee structure that jealously guards their turf. And as 
you noted, EPA has, I guess, over 50 different committees 
claiming some sort of jurisdiction over the Environmental 
Protection Agency. And the team approach that the 
administration is looking at at this point isn't intended to 
prohibit other congressional Members or staff from calling on 
agencies to consult with them. But do you think this approach 
is going to be sufficient to resolve disagreements at this 
point?
    Mr. Stevens. It is certainly necessary, Mr. Davis. And it 
is not an administrative initiative. This was one taken by the 
congressional leadership itself to establish these crosscutting 
teams that it has just begun to form.
    It is very much a step forward. I think it is recognition 
that there are a number of diverse interests within Congress 
that need to be reconciled is a way of bringing those together. 
Whether it will in itself be sufficient to recognize these, I 
would have to say in some cases, yes, and in many cases it is 
going to take much more time and effort and simply 
communicating together is not going to resolve the problem 
itself.
    Mr. Davis of Virginia. As I understand, the agencies are 
going to consult not only with Congress, but with stakeholders, 
constituents.
    Mr. Stevens. The act does not use the word ``consult'' with 
stakeholders. It is to ``solicit'' the views, I believe, of 
stakeholders, but ``consult'' with Congress. But that is a 
stronger requirement with regard to Congress.
    Mr. Davis of Virginia. ``Consult'' is stronger than 
``solicit'' the views?
    Mr. Stevens. I believe it is, yes. We certainly interpret 
it to be stronger.
    Mr. Davis of Virginia. I assume they can solicit views from 
the various stakeholders. But at the end of the day, you have 
competing stakeholders, competing views, sometimes competing 
constituencies at this end of Pennsylvania Avenue, with the 
other end of Pennsylvania Avenue, with how the priorities are 
going to be shared. How does this sort out?
    Mr. Stevens. It will not be the same for each agency. I 
think some of the pilots that we found are fairly 
noncontroversial. If the Bureau of the Mint, for example, will 
do its job, if it puts out a certain number of coins at a 
certain level of efficiency, they have a less controversial 
task than the Environmental Protection Agency, for example. And 
I think there are going to be as many as there are agencies. 
And in some, the Department of Housing and Urban Development, 
for example, which is one you will be hearing from later today, 
I think they have a much more difficult job of bringing their 
diverse interest constituents together than some other 
agencies.
    Mr. Davis of Virginia. Limited budgets challenge them even 
more. In the old days you tried to give something to everybody, 
and nowadays that is becoming increasingly more difficult.
    Mr. Stevens. And it makes it more contentious, too.
    Mr. Davis of Virginia. How is this being regarded at the 
Federal level in the agencies? Is this viewed as just another 
initiative and we will deal with it as we have to, or is it 
really being taken seriously as a real opportunity to maybe get 
some of these agencies back on their feet and restore not just 
some integrity, but prestige to the process of what they are 
doing?
    Mr. Stevens. I would have to say, and we have looked very 
carefully at this that at the OMB, the Office of Management and 
Budget, there has been an absolutely wholehearted commitment to 
the Government Performance and Results Act because it helps 
them manage the Government as well. Within the agencies 
themselves, they will admit that there are some agencies that 
paid very little attention to this. They figured that's 
something that is coming down the road in 1998, nothing we 
really have to worry about now. They are now finally beginning 
to realize that it is real. And some still have not engaged the 
program people, the leadership of the agency. They regard it as 
a staff-driven exercise to be dealt with by the congressional 
relations people. There are some of those.
    To characterize the Government's reaction as a whole, we 
have a statutory reporting mandate that is due in June, and I 
guess we are struggling right now with how to do that, with 
what the result will be. And I can't say we have resolved it 
yet so that I could reveal the bottom line right here. I really 
don't know what it is. I think there is a very mixed bag so 
far.
    Mr. Davis of Virginia. The agencies generally have a 
mission statement or perceived mission--I haven't seen it so 
far.
    Mr. Stevens. Well, they are expected to.
    Mr. Davis of Virginia. I wonder, can you think of an 
example of what might have a mission statement or statements 
that are not directly related to their authorizing statutes or 
there are situations where the agency's statement wouldn't be 
consistent with legislative authority? Or will we find that out 
as we go through this?
    Mr. Stevens. I think that is in part a legal judgment. It 
is in part a political judgment because these are at a pretty 
high level of abstraction.
    I mentioned to Mr. Sessions that there are a couple of 
agencies that don't even have organic or authorizing statutes, 
the Environmental Protection Agency and Federal Emergency 
Management Agency being examples.
    The Department of Energy is one in which its founding 
departmental philosophy was to respond to an energy crisis. Its 
actual duties and responsibilities are quite far apart from 
that right now. In fact, I heard at a hearing that former 
Secretary O'Leary said that their real mission was science, and 
I doubt that that could be found in their organic statute.
    Mr. Davis of Virginia. It could be very interesting. It 
looks to me this is a great opportunity. I was in local 
government for 15 years where we were faced with a huge budget 
deficit in my first year. We marched over to the agency and 
said, what is your mission? And it was interesting how many of 
them perceived the mission different from what had originally 
been set out. It just kind of evolved and they went off on auto 
pilot and sometimes somebody would come in and check them and 
if something went wrong they would repair it, but most of the 
time, things moved too quickly out in Fairfax and at the 
Federal level for anybody to check through this and take a look 
at any long-term vision.
    This is a great opportunity if the communications, and I 
think that is going to be the difficult part on the part of the 
Federal Agencies, to communicate with Congress and to try to 
get closure and agreement on some of these areas. If we do 
that, this is unique. This is the first time we have really, to 
my knowledge, that we have had this constructive dialog, 
between the executive and legislative branches. All of these 
other innovations, as you point out, were without legislative 
mandate.
    Any additional thoughts on that?
    Mr. Stevens. One of the advantages of having this statute 
is that it doesn't follow the usual pattern of being an 
administrative initiative that the next administration feels it 
needs to move on from, to develop its own management issue. 
This is a law. This is one that Congress has enacted as a 
regular set of responsibilities, and I think that is going to 
help give it some permanence.
    Mr. Mihm. There will also be the need, Mr. Davis, for 
agencies as they are developing their mission statements, of 
course, to go back to their statutory requirements. What do we 
have to do, and start to sort out what have we just accumulated 
over time, because we like to do or what we think would be nice 
to do, but as part of that to also focus on the results that 
they were created to achieve.
    All too often agencies define their missions in terms of 
the number of activities they do or they exist in order to do 
services or products and forget that those are merely the means 
to an end. It's the end that's important, and once they start 
focusing on that end, that opens up whole new avenues of, gee, 
are we being as effective as we ought to be in delivering the 
services and products that will get us that result.
    Mr. Davis of Virginia. Thank you very much. Thank you, Mr. 
Chairman.
    Mr. Horn. You are quite welcome. Let me ask a few general 
questions, and then we will begin another round of questioning 
and get into more detail.
    One of them is, in the case of Office of Management and 
Budget, have you had an opportunity to look at its strategic 
plan?
    Mr. Stevens. No, we have not. We are aware, I believe, that 
they are having an offsite meeting that is meant to be a very 
seminal event in that regard. We haven't been invited. I would 
be interested to be, but we really are not aware of it, no.
    Mr. Horn. You have not been invited, I take it?
    Mr. Stevens. No.
    Mr. Horn. Have they held the meeting yet or is it 
simultaneous with this hearing?
    Mr. Mihm. They held an initial offsite with their senior 
managers probably now 3 or 4 months ago. They had an OMB-wide 
stand down day at the end of February in which they were all to 
be discussing and thinking about their strategic plans.
    One of the things that has been particularly interesting to 
us at the staff level, that we have been urging OMB to do is 
that they are, of course, subject to the Government Performance 
and Results Act. This is a perfect opportunity for them to show 
a leadership role in congressional consultations by engaging 
with this committee and the Senate Governmental Affairs 
Committee to start talking about what are our mission, what are 
our goals, what are the strategies, how are we going to assess 
our effectiveness, all the other requirements of the act.
    To our knowledge, they have not been up here to discuss 
with you or your colleagues exactly those issues. So we, as I 
said, have been urging them in a friendly manner, but also 
understanding the type of reaction we would get with that 
recommendation.
    Mr. Horn. You anticipated my next question, which is, if 
you had seen them around, I feel like the guy that was in an 
organization and they changed a lot of things and he said, if 
the boss calls, get his name. And if they show up through the 
door, make sure you tell me they are OMB because I will give 
them the royal treatment.
    So, you might suggest that we are their oversight committee 
and maybe they would like to talk to us once in a while. But 
anyhow, so much for OMB.
    Now, let me ask in terms of the strategic plan and move to 
the measurements. What I am particularly interested in, since 
we have experience, it is global on some of these questions. In 
other words, what has the New Zealand Government done? What has 
the Australian Government done? You are well familiar with 
that. What has the State of Oregon done? And what I am 
wondering is, how far along are we in devising some realistic 
measures that really tell us when an agency is accomplishing 
its program goals?
    Are we simply at the goal-setting mission statement 
strategic vision aspect, or are we down to the nitty-gritty 
yet? And, if so, how do you see those experiments in relation 
to what we know New Zealand, Australia, Oregon have already 
done?
    Mr. Stevens. Certainly, those other Governments that you 
mentioned, Mr. Chairman, are far ahead of us and they have been 
at it a much longer time, measured in decades rather than 
years.
    In our Executive Guide, with which you are familiar, we 
chose some examples of Federal agencies that have managed to 
come up with some good performance measures. I have teased Mr. 
Mihm here a couple times because they become very familiar. The 
Coast Guard example, their inspection program is one that we've 
used over and over and it is a very compelling one. It is the 
way this is meant to work. It is also the best one, and I don't 
know that we have come up with another one that good since.
    Mr. Horn. Just for the record, even though it's repetitive 
of other hearings, give us a vision here and a version in a 
little bird's eye view of how the Coast Guard goes about that 
matter.
    Mr. Stevens. The Coast Guard has a ship inspection program 
that measured itself by the number of inspections it carried 
out over the years, the number of deficiencies it found in 
ships. In going through a GPRA-like exercise, and it did 
precede GPRA, they looked at the causes of deaths in the 
maritime industry and discovered that a large majority of them 
were not from the condition of ships, but were from human 
error, and they devised a performance measure that said if 
we're here to minimize the loss of life, that's really how we 
ought to measure the result of our effort.
    And Chris will help me with the numbers in a minute, but 
they did define their outcome measure as the numbers of deaths 
in the maritime industry per hundred thousand work years, and 
by working more closely with the shipping industry, by 
concentrating on that human element, on training, on people 
avoiding mistakes within that element, they brought the number 
down from, I think, 91 deaths per hundred thousand to 27 per 
hundred thousand in a short period of time.
    They also did it with fewer staff because it takes less 
manpower to do that kind of thing working with the industry 
than to carry out ever increasing numbers of ship inspections 
and it ultimately did better. That's a beautiful case, but as 
far as I know, it is still unique.
    Mr. Mihm. Mr. Horn, what the Coast Guard shows us and there 
are a couple others of FEMA that we have been impressed with, 
and Veterans Health Administration. What these all have in 
common, and it gets back to the point I was making with Mr. 
Davis, is that the organization stepped back and asked the 
fundamental GPRA question. Why do we exist and thought of that 
in terms of results rather than in terms of, well, we exist 
because we are a regulatory program. No, we exist because we 
want to reduce, in the case of the Coast Guard, the incidence 
of deaths and injuries in the towing industry. The regulatory 
approach is just the strategy that they had chosen rather than 
the reason that they existed.
    Mr. Horn. And maybe the tactics they had chosen also.
    Mr. Mihm. Yes, sir.
    Mr. Horn. Well, Mr. Stevens, you anticipated my third 
question, which is the relationship of number of personnel to 
the results. And I was thinking of the downsizing in private 
industry where sometimes the whole mission is improved because 
they have cut out middle layers of people that are simply 
sending memos to each other and really don't have any role in 
getting the job down where the action is. How are we going to 
look at that? Do we have any good examples now, besides the 
Coast Guard?
    Mr. Stevens. We have done a number of reports on downsizing 
within agencies. It has been an exercise that has so far been 
carried out more or less in advance of the Government 
Performance and Results Act. And one of the major conclusions 
we have reached is that agencies have not gone about this the 
right way. They haven't taken the steps of saying, what is our 
mission, what are we trying to accomplish, and what kind of 
workforce do we need to accomplish that?
    Rather, they have taken the resource level--the numbers of 
people--as an independent variable. They have said, well, we 
will cut it and see what we have left and try to decide where 
to go from there.
    Workforce planning is ultimately a very important tool in 
this exercise. It is one that if GPRA had been well established 
at the time that the last downsizing took place, we would have 
expected a much more coherent approach to it, but it hasn't 
happened yet.
    Mr. Horn. Recently, I had the staff send out a 
questionnaire on quality management, surveying how much 
activity in that area had occurred either in improving the 
relationships between the management group or just what 
experiments were underway.
    In terms of some of the agencies you've looked at, to what 
degree have they gone through what the private sector has gone 
through, some of the military groups, in terms of the quality 
management idea, of which I would think determining what is our 
mission, how do we carry it out, how do we phase it in and all 
the rest of it ought to be part of that? Have you found some 
experiments? Is there any correlation between those agencies 
that have done that work and what they are doing under the 
Government Performance and Results Act?
    Mr. Stevens. A number of the pilot agencies had been 
working on results-oriented management for a number of years, 
and I assume that, but do not know for sure that those emerged 
from the kinds of quality examinations that you're talking 
about, TQM or an adaptation of it. But I'm not--I'm not certain 
of exactly what program it led to. I know they engaged in this 
and that it has worked and the ones that have had a head start 
certainly have done better than those which are just now 
beginning, which is the vast majority.
    Mr. Horn. Any comments on that, Mr. Mihm?
    Mr. Mihm. I would just reiterate one of the messages, as 
you know, Mr. Horn, from one of our high risk reports, which is 
that all too often we throw money, especially in technology 
projects, at problems without re-engineering those problems to 
make sure that we are being as efficient as we need to be. 
That's been one of the major deficiencies that we've seen in 
program after program that's invested, $145 billion over the 
last 6 years in information technology at the Federal level 
without fundamentally reassessing first why are we even doing 
this and, second, are we doing this in the most efficient way 
possible. We end up automating things we ought not to be doing. 
That's a continuing challenge with GPRA implementation as well.
    Mr. Horn. One of the things that always worries me when we 
talk about the measurements is people often take the easiest 
route. They see something that you can add up, count, divide, 
so forth. What's your reading on the type of measurements that 
make some sense in public agencies that are designed to serve a 
clientele? I mean, granted, we can look at Social Security and 
say, gee, did you get the benefit checks out in time? How many 
errors did you make? So forth and so on. What are some of the 
other measurements?
    I've told the story before that I remember the Department 
of Justice examination of the National Institute of Corrections 
was the stupidest analysis I had ever seen. That was about 10 
years ago. Hopefully they have improved. But they simply were 
talking about measurement judgments that related to an agency 
and they picked something they could count, not something that 
was relevant. So how do we deal with that?
    Mr. Stevens. You're certainly correct, Mr. Chairman, that 
measuring of activities or outputs is much more familiar and 
much easier for agencies. The best example is job training 
programs where there is a tendency among the 163 or so programs 
that exist in Government to measure the number of contacts they 
have or number of participants in the job training programs and 
to set goals that have ever increasing numbers of those 
participants.
    But the basic question the GPRA should provoke them to ask 
is the underlying importance of that. And it is not important 
that people be participants in programs just to be participants 
in programs. It is that they become employable individuals with 
jobs in the private sector and that ought to be the measure.
    It's much more difficult for an agency to achieve because 
they rarely have the data by which to do this. It has to be 
done over time, probably cooperatively, and it's just much more 
difficult. So there will still be a tendency, and we are 
finding this in the initial GPRA plans, to measure outputs and 
activities as opposed to real results.
    Mr. Horn. That is an excellent example because, as we would 
agree, I think, what they ought to be measuring is, what 
happened to their product 6 months, 1 year, 2 years later. Are 
they employed, are they benefiting in terms of rising up the 
hierarchy at all?
    Now, one easy way to track them is their Social Security 
number. And is there a need in the law somewhere to assure on 
that type of a measurement survey, if you will, a result survey 
that we could gain the cooperation of the Social Security 
Administration to reveal those data to the other agencies if 
they are doing that type of management analysis? What do you 
think, are there any blockages there we should worry about?
    Mr. Stevens. There are restrictions on data sharing, Mr. 
Chairman. You've done some legislative work in looking at some 
of the ways our statistical system is organized. I'm not 
certain the extent to which Social Security is limited to 
providing that information to outsiders. But certainly some 
agencies are prohibited and there are some drawbacks to data 
sharing.
    We have, as an institution, engaged more heavily than other 
agencies in matching programs, computer matching perhaps, but I 
have to tell you it's been controversial. There have been some 
objections to some of our investigative methods that take two 
lists and determine which ones are in both programs.
    Mr. Horn. Is that an objection or worry that they didn't 
look too well at the end of it?
    Mr. Stevens. We had some of both. There are people who have 
had principled objections to this and the Privacy Act, which, I 
believe, is under the jurisdiction of this committee was a 
legislative response to that that perhaps should be re-
examined.
    Mr. Horn. I'm sure people have valid reasons as a matter of 
principle, but I've often found that many organizations revert 
to principle because they don't like the result of a study, and 
I worry about that. If we're going to really be realistic, we 
need some cooperative relationships with all due respect for 
the privacy of the individual, but not necessarily the privacy 
of the agency in the sense that we need to know if these things 
work.
    With a $5.3 trillion national debt, we can't afford some of 
these things that are wonderful bits of smoke and mirrors. The 
question is, do they work? If they don't work, let's get 
something that does work and how do we measure that?
    With that, I would like to yield to the vice chairman, Mr. 
Sessions, to continuing the questioning.
    Mr. Sessions. Mr. Chairman, thank you.
    Mr. Stevens, I would like to take up what would be 
considered a new line of questions, and that is dealing with 
the numbers of people who are employed in agencies, in other 
words, what you would probably call the workforce.
    I saw last week where the Army is now saying, in order to 
get the number of people that they need, they are going to drop 
the requirement for high school diploma. I have seen that the--
I believe it is the INS is offering $25,000 as a buyout to some 
employees to leave the agency. These are unrelated, but they 
are generally to the point of workforce and numbers of people 
are qualifications, what an agency is doing to meet their 
mission statement.
    Can you speak with me about funding levels, workforce 
requirements, and that relationship to what we could anticipate 
in this GPRA report that we will get later in the year? Is that 
addressed? Is it addressed properly? Are we asking the right 
questions? Are agencies including this as part of not just the 
mission statement, but the workforce requirements?
    Mr. Stevens. They should be, Mr. Sessions. And certainly, 
GPRA contemplates that they will. An agency's first step should 
be to develop its mission, then its strategic way of getting to 
that mission. And it is premature to decide what your strategic 
way should be, which is often hiring a workforce before you 
have decided what that mission is. A workforce is only one way 
to get to a mission. Another way is a tax expenditure or is 
contracting out to third party deliveries.
    And agencies tend to have a conviction that because they 
have a certain workforce they have got to keep them. That 
becomes almost a mission of itself for the agency, yet GPRA 
makes them go back to a step before that and say not what is 
your workforce doing, but why do you even have a workforce? Can 
your objectives and results be attained by a less labor-
intensive means? And very often that will turn out to be the 
case.
    The downsizing that has been undertaken in the last 4 years 
did not usually take that step. There wasn't any workforce 
planning or any decision on what agencies were doing. It 
targeted older people in the workforce partly because their 
salaries contributed more to deficit reduction. But again, that 
doesn't make a lot of sense in some agencies where experience 
and knowledge are more important than ever in a smaller 
environment.
    Mr. Mihm. I would add to that, Mr. Sessions, that one of 
the things that we're seeing with successful organizations that 
are implementing GPRA is that they are looking at and 
understanding both halves of the equation. It is a focus on 
results, and that means stopping the focus on a lot of the 
process controls that have been put in place, and particularly 
with agencies, that agencies are going about doing GPRA and 
focusing managers on results have to give them the freedom and 
authority to achieve those results and then hold them 
accountable for the use of that freedom and authority.
    We, in our Executive Guide, talk about the Corps of 
Engineers which had had requirements for up to five different 
signatures for procurements of less than $25,000 out in the 
field. Now, these are people that are running million-dollar 
dredging operations and they needed five signatures. People in 
the field thought we had to go after GSA or OMB to get relief 
from this. Actually, it was coming from the Corps of Engineers 
itself. There was blood under the door when that was revealed. 
And as a result, they have made some changes. They are saving 
$6 million a year and 175 FTEs because they are giving managers 
authority to achieve results, holding them accountable for 
those results, and getting out of the business of process 
controls.
    So once you start focusing on results, it does free up some 
resources that otherwise would go to a lot of these systems 
overseers that are there to push paper or to run the 
bureaucracy.
    Mr. Sessions. Can either of you give examples or discuss 
how agencies are doing when they do reduce the numbers of 
employees that they have? Is that a one-time shot and they come 
back and hire, or are they replacing higher paid employees for 
lower paid employees? Are they playing a game, get them off at 
the end of the year, add them back later? Can you discuss that 
briefly with us?
    Mr. Stevens. Yes, Mr. Sessions. We have a number of reports 
in that area, too, which I might share with you. With the 
downsizing program, we find very few games being played. There 
was an incident in the Department of Energy in which some 
buyouts were recycled, but they really were fairly small 
numbers governmentwide.
    But the main problem, I believe, has been a failure to 
carry out workforce planning as part of the downsizing 
operation. It has generally appealed most--the buyouts that 
were offered have generally appealed most to people who were 
near retirement age, the more senior members of the workforce, 
and those have been differentially beneficiaries or targets, 
depending on how you view it, of the buyout legislation.
    Still, we believe that that has been more beneficial to the 
Government than the alternative process of reductions-in-force. 
That process is so highbound and so bureaucratic in itself and 
counterproductive in terms of the results, that that costs the 
Government more than the $25,000 buyouts that were authorized.
    Mr. Sessions. Interesting. Well, I'm hopeful that this will 
also be a part of a thought process. And I know there are some 
agencies here today. I hope they get that message also that it 
is not only just mission statement and process and performance 
with expectations, but also how you're going to notify your 
workforce to where they're going to realize what jobs are 
there. It has a lot to do with training needs, what kind of 
people you need in an agency to where it would be a road map 
for understanding what we need ahead.
    And I guess it goes back to my original statement about the 
Army having to go to get people that don't have a high school 
degree. At some point there is bound to be a reason why we did 
needed that type of person, and we're reducing our standards, 
it appears to me. And I hope that we don't find that we're 
getting rid of knowledgeable employees with expertise and 
taking something that is less than what it takes to get the job 
done.
    Mr. Stevens. Very few agencies right now could prove that 
to you.
    Mr. Sessions. And I think they need to be thinking about 
that also.
    Thank you, Mr. Chairman.
    Mr. Horn. You are quite welcome.
    The gentleman from Virginia, Mr. Davis, for 10 minutes.
    Mr. Davis of Virginia. Just to followup on a couple of 
things. I appreciate your testimony. I think you know, in your 
testimony that was submitted for the record, at least, that one 
of the congressional staff went down, the subcommittee staff 
met with the agency officials and it became confrontational. 
This is going to happen from time to time. I think this is 
something that's a learning experience on our side, as well as 
on the side of----
    Mr. Stevens. It happened before GPRA, Mr. Davis.
    Mr. Davis of Virginia. Right. In fact, it usually happens. 
What we need to do is tone this down at this point. I noticed 
the way they tried to work around, find the areas we agree. 
Some of the areas like where are you using IT, where can we 
enhance getting more information out, what is the most cost-
effective way, those kind of things are clearly areas we are 
going to have to work on? But you can just see when you get 
some of the staff, some of which, believe it or not, is 
partisan, together with Schedule C members, that you are going 
to get that confrontation.
    So this is a learning experience for both of us and we need 
to know. We will be learning as we work through this. But at 
the end of the day, even though there may be program 
disagreements in some of these Federal agencies that get pretty 
politically charged from time to time with some elements of the 
Hill up here, that we can still improve the way they are doing 
it, even though we may not agree with what they are doing, but 
they can do it more effectively.
    That's going to take, I think, a constant dialog. It is 
going to take constant reports from you and others up here 
telling us how we are doing, and a learning experience. As I 
said, this is an opportunity, that I am not even sure the 
people who envisioned this act recognized all that it has the 
possibility to do, if it works right.
    But I think what we are seeing and what I gather you are 
saying is that the discussions between staff up here and agency 
staff are all over the lot at this point and it is just all 
over the lot. Some of them have been very constructive. Some of 
them have been attitudes.
    Mr. Stevens. None have really risen to the level of the 
consultations that GPRA envisages. They have all been 
characterized as really pre-consultation meetings.
    Mr. Davis of Virginia. OK. So far.
    Mr. Stevens. Kind of meetings before the meetings.
    Mr. Davis of Virginia. OK. They have been able to learn a 
lot.
    Where would you say at this point we have made the most 
headway? Is there any agency you can look at, at this point, 
and say this is really on the right track and is a model, or is 
it still too early to say that?
    Mr. Stevens. In the consultation process per se.
    Mr. Mihm. If I could answer it by saying, rather than 
particular agencies, it is the agencies that have a clear 
commission going in, the most direct relationship between what 
they do and the result that they are designed to achieve. So 
agencies such as the Bureau of the Mint, presumably the Social 
Security Administration would be another, where it is fairly 
clear going in what we want them to do and that there is not an 
awful lot of rancor between committees or parties up here on 
the Hill or between the agency and the Hill. So those are the 
ones that have been most successful.
    The ones proving quite difficult are those at the other end 
of the spectrum, where there is the most tenuous or longest-
term relationship between the activities they do and some final 
result. Science and research agencies can have a tough time of 
it. Intergovernmental programs, as you can imagine, have a 
tough time of it.
    What do we really want them to achieve? What are we going 
to hold the Federal Government accountable for in an 
intergovernmental program? Those are the ones where it is going 
to take quite a bit of time to sort out what their goal is, 
what their mission is, what their measures are and how we are 
going to assess performance.
    Mr. Davis of Virginia. I think you are right. The mission 
is basically the ballgame.
    Mr. Mihm. Yes, sir.
    Mr. Davis of Virginia. If you agree on that, then it 
becomes a lot easier to say, how can we do this more 
effectively? And the discussions can be--they can be heated but 
they can be more calmer.
    One of the things that I found happens is you have got a 
lot of good people sometimes out in agencies and they are 
working hard but they are performing tasks that really don't 
need to be performed when you take over what your final 
objective is. They are working under regulations that really 
didn't need to be written. They are filling out forms that 
don't need to be printed. And those are the kind of things that 
I think, working together, both sides can start taking a look 
anew at that instead of fighting over the mission statement. I 
think that's a good point.
    I think I will stop on that, Mr. Chairman.
    Thank you very much.
    Mr. Horn. Thank you.
    Let me ask a couple of followup questions here. Are there 
any more, by the way?
    We have got advisory boards and committees and a lot of 
Government programs. I don't know what the current number is. 
At one time, I think it was around 1,000 and then we had a 
cutback. Do you have those figures off the top of your head?
    Mr. Stevens. Advisory committees to Federal programs?
    Mr. Horn. Advisory committees, yes.
    Mr. Stevens. I don't have a current number but it is 
usually numbered in the low four figures, about a thousand.
    Mr. Horn. I have been on several of them in my previous 
incarnations, and some of them have been excellent, where you 
get a real cross-section of people that are both professionals 
and nonprofessionals, that can raise the why question, why are 
we doing this, and get somewhere with it. I found them very 
useful.
    To what extent do you know that those advisory committees, 
their advice is being taken into account on this, because 
that's a built-in way?
    Now, some of them are strictly tools of the particular 
agency, and that's another worry when you don't have that 
outside critic, if you will, on those advisory committees. Do 
you see any evidence of use of these committees at all in your 
wandering around the executive branch?
    Mr. Stevens. We really haven't checked that, Mr. Chairman. 
I think it is an excellent means to get the views of outside 
stakeholders. That's really why these committees are formed, to 
bring diverse viewpoints of people who aren't directly engaged 
in the workforce of the agency but have knowledge and 
perspectives that they can bring to bear.
    I would think that an agency head, who was faced with 
developing a strategic plan, and performance indicators, would 
find the first place he would turn would be that outside 
advisory committee, which presumably is people who are wise. 
And it's generally almost free; if not free, they usually have 
to pay travel expenses and it would be an excellent place to 
turn.
    I know that the General Accounting Office had a couple of 
advisory committees that Mr. Bowsher put together and he 
gathered them regularly. I can testify that he certainly took 
their advice seriously, and when matters of overall priority 
and strategy were at issue, they gave very helpful advice. It 
was very useful.
    Mr. Horn. Just to give you an example of one advisory 
committee that I saw worked very well, the law happened to be 
developed by a really first-rate gentleman in both 
understanding Capitol Hill, understanding the problems of the 
Bureau of Prisons and a very distinguished lawyer, the late 
Robert Cutac. He happened to draft the law that led to the 
National Institute of Corrections. He did 90 percent of the 
work. I did about 10 percent of the work, as I recall, and then 
it was enacted.
    We didn't even have a hearing on it. The Senate just put it 
in, rolled through, and we were established. The idea was that 
of the Chief Justice of the United States, Mr. Burger, that we 
ought to do something about State corrections, and we built 
into that advisory committee assistant secretaries from other 
agencies.
    And I rapidly realized, as one of the founding members, who 
had helped draft the law, that a lot of these assistant 
secretaries had never talked to each other; I mean, Assistant 
Secretary of then HEW on the youth side, along with the 
Director of the Bureau of Corrections, along with the Legal 
Center and so forth.
    We just added them all in and they showed up. And a lot of 
good things came out of that in what we tried to do in 
stimulating reform at the State level, which was eons behind 
what the Federal Government had done in corrections, because we 
had had a fairly high level of professional service in the 
Bureau of Prisons for the last 50 years, and it was just 
getting them together at the State level to pay for the coffee 
and say, hey, why don't you guys meet once in a while and spend 
a couple of days thinking about it? Because in that field you 
have the policemen on the beat blaming the judge; the judge 
blaming the DA. All of them are blaming the prison, the jail 
administration and so forth. We started getting those people, 
the sheriffs, the police chiefs, all in the same room and some 
good results happened.
    So what we need is to look at some of those in terms of the 
stimulus they can do to improve a program. And actually the way 
we wrote the law, the advisory committee recommended the 
Director to the Attorney General. Now, the Attorney General is 
free to say, I don't like your three recommendations, but they 
never did, and they picked one of the three that we had looked 
at.
    So I found that a useful advisory committee, others that 
will go nameless, I found a non-useful advisory committee for 
the reason that they were sort of the agency pets that were 
just to come up and lobby Members of Congress for more 
resources without any great reason why.
    I also am reminded of our friend, Rufus Miles, that a lot 
of you know, that Miles' law: That where you stand depends on 
where you sit.
    And I think of one of my colleagues on Capitol Hill in the 
1960's, who was always denouncing what was going on in the 
executive branch until he was made Associate Director of the 
Bureau of the Budget, as it was called at that time, and then 
when I visited him he denounced everything we were doing in the 
legislative branch. The conversion must have been only one shot 
in the arm of something, as he crossed the middle of 
Pennsylvania Avenue.
    And I just wonder, on those attitudes there, what do you 
detect as you go around? Is there a willingness to carry out 
this law or is it just doing the minimal to try and get past 
the guideposts under the law?
    What kind of sense do you get? Is there some enthusiasm 
that this is going to help them run a better program or are 
some sort of still saying, well, I will put it off until a week 
before the deadline?
    Mr. Stevens. There are examples of both, Mr. Chairman. But 
I have to say that we have been impressed by the efforts of the 
Office of Management and Budget for the past couple of years in 
bringing home to agencies the expectation that their programs 
will be measured to a greater extent on results than has been 
true in the past.
    Alice Rivlin and John Koskinen, when we looked at OMB's 
internal management operation, the OMB 2000 reorganization, 
which you are familiar with. We found that their personal 
attention to this was extremely important in keeping that 
institution committed to it.
    A second group that has also been very supportive, 
influential, and I think has helped generate the expectation 
that agencies will take this seriously, is the GPRA Committee 
of the Chief Financial Officers Organization, and we have 
worked very closely with them. And from what I have seen of 
their literature, Chris Mihm has attended their meetings, that 
has been an excellent forum of the kind you were just referring 
to when you are talking about outside of these advisory 
committees, that has been an excellent forum for people 
throughout the executive branch to learn best practices, 
expectations and to really become alert to the fact that this 
is going to be a requirement on all of them in the future.
    Mr. Mihm. I think for a number of agencies, Mr. Chairman, 
there is a bit of a wait-and-see attitude, is that we have had 
a lot of interest and a lot of talking and evangelizing for 
GPRA over the last couple of years. It is now time for it 
really to be implemented.
    There is a wait and see, of let's see if Congress is really 
going to get on board with this. In that regard, the statement 
of the majority leader at the full committee hearing last 
month, a letter from the congressional leadership that went 
over to OMB Director Raines, hearings such as these that you 
have had over the last couple of years, send unmistakable 
signals to agencies that Congress is interested, first, in the 
implementation of the act and, second, for a new type of 
relationship.
    As we think about consultations, it is not the old way 
where we just drop off a draft, something stamped draft, and 
say get back to us in 10 days if you have any comments, but 
really working together to try and reach some common 
understanding of goals and measures. I can testify directly 
because I spend a lot of time with agency officials, these 
types of measures send very, very clear messages and very, very 
dramatic messages down to the agencies of how important 
Congress views the implementation of GPRA, and as a result, it 
furthers the implementation of the act.
    Mr. Horn. Do you find much sharing between agencies at this 
point in the process, where somebody might have developed a 
good measurement that could be applied elsewhere? Are they 
hearing about it? Are they meeting and sharing information?
    Mr. Stevens. I think the CFO council mechanism is the best 
example of that. That has taken place, yes.
    Mr. Horn. Well, I have high regard for that council. I 
think you are right. And, of course, now we are having the CIO 
council, not the union, but the Chief Information Officers, and 
that, I would think, would help a lot because they are 
essential in terms of a lot of the measurements being 
successes.
    Mr. Stevens. Yes, sir.
    Mr. Horn. Well, if there are no more questions of this 
panel, why don't we have our last four witnesses on panel two 
come forward, Secretary Robinson, Commissioner Dyer, Director 
Jones, and Chief Stewart.
    So if you would all come join us at the table, we will 
swear you in and just go down the line before we get into 
questions.
    [Witnesses sworn.]
    Mr. Horn. All four have affirmed.
    We will begin with Secretary Robinson on the progression 
that has been made by the Department of Housing and Urban 
Development.
    Mr. Secretary, we are glad to have you here.

STATEMENTS OF DWIGHT P. ROBINSON, DEPUTY SECRETARY, DEPARTMENT 
 OF HOUSING AND URBAN DEVELOPMENT; JOHN DYER, ACTING PRINCIPAL 
     DEPUTY COMMISSIONER, SOCIAL SECURITY ADMINISTRATION, 
ACCOMPANIED BY CAROLYN SHEARIN JONES, DIRECTOR OF THE OFFICE OF 
  STRATEGIC MANAGEMENT; AND RON STEWART, ACTING DEPUTY CHIEF, 
         U.S. DEPARTMENT OF AGRICULTURE FOREST SERVICE

    Mr. Robinson. Good morning, Mr. Chairman and thank you for 
this opportunity to appear before the subcommittee this morning 
to discuss the status of HUD's implementation of the Government 
Performance and Results Act.
    For the record, I have submitted my full testimony to you.
    Mr. Horn. Right.
    Mr. Robinson. And I will just simply provide major 
highlights in my comments this morning.
    Mr. Horn. Excellent. That's what we would prefer. I am not 
putting the clock on a strict 5 minutes, but if you could keep 
it to 5 to 10 minutes, that would be helpful.
    Mr. Robinson. Actually, it should be a little less than 5 
minutes, Mr. Chairman.
    Secretary Cuomo and I believe that this important 
legislation has and will continue to help us to better serve 
our customers by better managing our resources. This is the 
reason we have embraced the legislation in all of its 
components. The following is the Department's implementation 
development path.
    We will deliver the Department's Strategic Plan for GPRA to 
Congress on September 30, 1997, as required. The Department has 
been developing component parts of our strategic plan, that is 
the performance objectives, the measures and other requirements 
since fiscal year 1994.
    We have used an application of Lotus Notes software to 
develop specific goals and objectives and performance measures 
and a way to monitor our progress in carrying out these major 
management plans and targets.
    The performance reporting process has included the review 
of accomplishments against established goals and objectives and 
milestones at regularly scheduled management committee meetings 
during the past few years. Based on these experiences, the 
Department has created and improved its system for establishing 
more accurate outcome-based performance measures, that is up 
from 4 percent to over 20 percent in 1997.
    An example of our outcome performance goals and performance 
measure criterion is the Secretary's priority for community 
empowerment through the HOME program. The established outcome 
measure for fiscal year 1996 was production of, or 
rehabilitation of, 50,000 affordable housing units. As of 
September 30, 1996, we have produced more than 62,000 HOME 
units.
    Our fiscal year 1998 budget submission links outcome-based 
performance indicators to major program areas. The next step in 
the performance-measured process for the Department will be the 
development of accurate and reliable performance measures to 
all our major program areas. The Department considers customer 
service to be an important element of our overall strategic 
planning process. In that regard, we have developed and 
implemented customer service standards, conducted customer 
service surveys and are developing an integrated customer 
service system.
    Finally, we have worked with other agencies such as the 
Department of Labor and the National Performance Review to 
further refine our performance measures and implementation 
plans and we expect to begin in earnest our consultation with 
Congress and other stakeholders soon.
    Thank you, Mr. Chairman.
    Mr. Horn. Well, we thank you, Mr. Secretary, for that 
overall presentation.
    [The prepared statement of Mr. Robinson follows:]
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    Mr. Horn. And we now move to Mr. Dyer.
    John Dyer is the Acting Principal Deputy Commissioner for 
the Social Security Administration.
    And you are accompanied by Ms. Carolyn Shearin Jones, the 
Director of Office of Strategic Management in the Social 
Security Administration.
    So, Mr. Dyer, if you would summarize your statement and 
give us the high points, we would appreciate it. Anything Ms. 
Jones would like to add to it, please feel free to.
    Mr. Dyer. Mr. Chairman and Members of the subcommittee, I 
am pleased to be here today to discuss how SSA is implementing 
the Government Performance and Results Act of 1993, or GPRA.
    I will be discussing how well SSA is positioned at this 
time to comply with the law, including what we are doing now to 
refine our Agency's Strategic Plan before the statutory 
deadline of September 30, 1997. GPRA includes as one of its 
primary purposes: improving the confidence of the American 
people in the capability of the Federal Government.
    As one of the handful of Federal agencies whose programs 
directly and visibly touch the lives of millions of Americans, 
SSA plays a pivotal role in shaping the public's opinion and we 
take our responsibility very seriously. SSA has a strong 
history of doing much of what GPRA requires.
    We have always measured the work we do and the way we do 
it. We have always been attuned to important societal trends 
that would affect program implementation. We have always been 
proud of our service orientation and our concern with the needs 
of our customers.
    SSA's 1991 Strategic Plan contains a specific set of 
service delivery objectives that set forth the level of 
service, in real numbers, that SSA intended to achieve over a 
15-year period. Our efforts to re-engineer the disability 
process and our improvements in access to our national 800-
number have had their roots in the strategic plan.
    SSA already tracks a number of workload and performance 
measures that we, in consultation with the House Appropriations 
Subcommittee on Labor, Health and Human Services, Education and 
related agencies, worked out with Chairman John Porter, and the 
committee staff. Chairman Porter has asked SSA to actually 
commit to various performance levels in 15 workload and 
performance measures. We have been working with that committee 
since the 1995 budget on that process.
    We report on what we do. SSA began publishing audited 
financial statements several years before the law required it. 
And those statements have evolved into our accountability 
report. The report, which links program and financial data to 
establish how well the agency's programs and resources are 
being managed, is seen as a model of integrated reporting on 
the operational health of a Federal agency.
    Our current leadership environment has used GPRA as an 
impetus to move the Social Security Administration into a 
stronger and more productive position of espousing strategic 
management as a guiding philosophy of the agency. The 
representation of this philosophy is SSA's yearly business 
plan, which presents, first, the story around SSA's budget, 
including performance targets, the drivers, approaches and 
enablers of SSA's business strategy; second, an assessment of 
our business processes and service delivery interfaces and, 
third, a summary of the objectives and time lines of SSA's key 
initiatives.
    In direct response to GPRA mandates, we are creating a new 
merit performance construct to ensure that the measures on 
which we report performance at the highest level reflect the 
entire range of program and administrative responsibilities. 
The performance measures and targets will be based on customer 
and stakeholder input, current performance, resource management 
strategies, and the agency's own view of its future.
    GPRA has inspired us to be more efficient, to use more 
effective means of identifying where strategic action needs to 
be taken and to create systems and processes that allow us to 
evaluate the successes those actions have had in closing 
performance gaps.
    In recent years we have established a cost-benefit analysis 
methodology to be used agencywide, documented how work in our 
core business processes is being done to help identify 
innovation opportunities, and worked with different automated 
modeling tools to choose the best solutions to operating 
problems.
    The changes which have taken place in the new environment 
have not just been procedural, of course. Real results are 
being seen. For example, in 1991, one of our service objectives 
was to ensure access to a national 800-number system within 24 
hours of the time an individual first called. That objective 
drove plans for certain changes to an 800-number processing, 
including the use of new technology and more efficient use of 
staff. However, the input we got directly from our customers 
made us realize that the standard we were using was not 
responsive to caller expectations, and we changed our access 
goal from 24 hours to 5 minutes for 95 percent of our callers 
in fiscal year 1997. Mr. Chairman, we are at about 95 percent 
access now.
    It is important for us to regularly re-evaluate our vision 
and strategies. We are using the legislative due date for the 
GPRA Strategic Plan as an impetus to refine SSA's plans.
    We have just held the first of a series of executive 
discussions to make decisions around key issues facing SSA 
today and in the future. We plan to use the study of a 
customer-driven strategic plan sponsored by the National 
Performance Review for best practices that will help us equal 
or perhaps exceed the standards set by the best in the business 
for fulfilling the needs of customers through strategic 
planning.
    We are looking forward to establishing an active dialog 
with Members of Congress about the future they expect to help 
build for our agency. We will be finalizing our performance 
measures and identifying the levels of performance we intend to 
provide.
    In conclusion, Mr. Chairman, we are confident of SSA's 
ability to implement the full letter and intent of GPRA. We 
look forward to working with you to address what may be one of 
the biggest challenges it presents, from changing the 
definition of success, from what can be counted, to what really 
counts.
    I look forward to answering your questions, Mr. Chairman.
    [The prepared statement of Mr. Dyer follows:]
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    Mr. Horn. I thank you very much, Mr. Dyer.
    Ms. Jones, would you like to add anything else to that 
statement?
    Ms. Jones. No.
    Thank you, Mr. Chairman.
    Mr. Horn. We will now go to the Acting Deputy Chief, of the 
Programs and Legislation Department of the U.S. Department of 
Agriculture Forest Service, Mr. Ron Stewart.
    Mr. Stewart. Thank you, Mr. Chairman and members of the 
subcommittee. I am pleased to be here this morning to discuss 
with you briefly the implementation of the Government 
Performance and Results Act, or GPRA, within the Forest 
Service.
    I am also accompanied by Ann Loose who is the Assistant 
Director of Program Development and Budget, who is our agency 
expert in GPRA, and she is sitting behind me if we get into any 
kind of detailed questions.
    Results-based accountability is the heart of GPRA. Our 
experience with GPRA to date has helped us better link 
strategic planning to on-the-ground yearly activities and 
outcomes through our budgeting process, through monitoring and 
evaluation and ultimately through reporting, using both the 
annual performance plan and the performance report.
    The Forest Service was a pilot agency under GPRA, and as 
such we produced pilot performance plans beginning in fiscal 
year 1994. This has been an iterative process and we continue 
to improve each pilot plan based on what we have learned in the 
prior years.
    We have incorporated the GPRA reporting requirements into 
the annual report of the Forest Service, and we are in the 
process of incorporating GPRA into our budget process. Our 
efforts as a pilot agency have been reported as part of USDA 
testimony before this subcommittee in June 1995.
    The Forest Service has been in a unique position in 
implementing GPRA in that we have a long history of preparing 
strategic plans on a 5-year interval since 1974, as part of the 
Secretary's recommended resource program and then preparing 
annual reports of accomplishment as part of the Forest and 
Rangeland Renewable Resources Planning Act of 1974, also known 
as RPA.
    We have been able to capitalize on this prior experience in 
our implementation of GPRA.
    Our initial approach for the GPRA Strategic Plan was to 
incorporate the GPRA requirements into the Secretary's draft 
RPA program. This program was published in October 1995, and 
when it was reviewed by the Office of Management and Budget, it 
was determined that while it contained all of the information 
that was needed to meet GPRA's strategic plan requirements, 
they were not organized in a way that was easy to understand 
and so, therefore, we have currently gone to parallel 
approaches. We have two documents, or will have two documents, 
one which will be the Secretary's recommended RPA program and 
the other will be the GPRA Strategic Plan.
    These will have the same basic content and will have the 
same strategic direction, but one will be specifically tailored 
toward the RPA requirements and the second one toward the GPRA 
requirements so that they will be easy to understand.
    One of the strengths of approaching GPRA using the Resource 
Planning Act plan is that RPA requires a significant amount of 
public involvement. We have had two national focus group 
meetings which included participation by congressional staff, 
conservation and commodity groups, professional organizations, 
Federal, State and local agencies and organizations, tribal 
governments, and representatives of local, regional and 
national groups and organizations. These meetings were designed 
to provide a forum for the early identification of issues.
    Once the draft RPA program was prepared, a 90-day comment 
period began, and this was in October 1995. At the request of 
Members of Congress, a second 30-day comment period took place 
in May 1996. During that public comment period, we held six 
regional listening sessions and a series of briefings here in 
Washington, DC. As a result of our outreach to the public, we 
received 1,500 comments.
    In addition to this, we have participated in two 
congressional oversight hearings and a number of individual 
briefings have been given on the draft RPA program for both 
House and Senate staff. Although not required by GPRA, we have 
decided to complete a performance plan for fiscal year 1998 as 
a dry run in preparation for 1999.
    The draft 1998 performance plan contains specific 
quantified performance goals and associated performance 
indicators which will allow us to measure levels of 
accomplishment. The plan also displays baseline and historic 
trend data on performance indicators.
    We have already begun the budget formulation process for 
fiscal year 1999. The agency's strategic goals, fiscal year 
1998 annual performance goals and the fiscal 1998 President's 
budget have all formed the starting point in preparation for 
the 1999 budget discussions.
    The end products of this will be an agency request and 
associated performance plan which will be submitted to the 
Department with the agency request and then to the Office of 
Management and Budget. Once the President's budget is 
finalized, the performance plan will be revised, the budget 
justifications written and both sent to Congress with the 
President's budget.
    Once we receive an appropriation, the performance plan will 
be adjusted and the goals and accomplishments disaggregated to 
our field offices as part of their budget allocation. 
Accomplishments will be tracked during the course of the fiscal 
year and reported in the annual report of the Forest Service 
for fiscal year 1999.
    I am proud to say that we have been recognized for our 
leadership in implementing GPRA. The USDA Office of Inspector 
General rated our fiscal year 1996 performance plan as the best 
in USDA, and in a 1995 review, the Government Accounting Office 
used us as an example of their best practices studies.
    Mr. Chairman, the Forest Service believes that GPRA is an 
excellent tool. It helps us use our limited resources 
effectively by tiering from our mission through strategic goals 
and objectives to annual performance goals associated with our 
budget. We are able to clearly articulate our relationships and 
present a compelling case for our programs.
    GPRA helps us to focus the debate on accountability and the 
agency outputs with our public and with Congress.
    This concludes my statement, and I would be pleased to 
answer any questions you might have.
    [The prepared statement of Mr. Stewart follows:]
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    Mr. Horn. Thank you very much, Dr. Stewart.
    Without objection, the biographies of all of our panelists 
will be put in the record after they have been introduced and 
before the summary of their statement. We have a rather 
distinguished group of public servants before us and we are 
delighted you could make it to this hearing. You all have 
splendid records, which I had the opportunity to review.
    [Note.--The biographies referred to can be found in 
subcommittee files.]
    Mr. Horn. Let me now yield the first 10 minutes to the vice 
chairman of the subcommittee, Mr. Sessions of Texas.
    Mr. Sessions. Mr. Chairman, thank you.
    Thank you to each one of you panel members for being here 
today. We appreciate your service.
    It sounds that if we looked at what you submitted here, we 
should have no questions, we should go home and know that 
everything is going to work right.
    But with that said, I am going to take just a few minutes, 
if I can.
    Dr. Stewart, I would like to think back to your words at 
the very end. You talked about accountability and probably, we 
could write down a lot of words to get to where we want, but it 
really is accountability.
    But I would like to direct my comments, if I could, to 
Secretary Robinson and Mr. Dyer at this point.
    I am looking at the GPRA book that came out by GAO in 
trying to look at--I am on page 12, where it talks about 
defining the mission and desired outcomes. And so my question, 
Secretary Robinson, is, as we look at desired outcomes, is your 
agency looking at problems?
    I heard you mention customer service, attention to the 
needs of the public, even mission statement. But are you going 
in and looking at the problems that are and have been and are 
inherent within the agency?
    Mr. Robinson. Without question, Mr. Sessions.
    We have had, in fact, over the past 4 years, under the 
leadership of Secretary Cisneros looked at our organization and 
our programs across the board and been as critical as anybody 
in terms of how they work and what they produce in terms of 
service to the American people.
    We have proposed, as you know, over time, a number of 
renovations, changes, transformations of the Department. We are 
committed to continuing that under Secretary Cuomo. He said 
both in his confirmation speech and in our budget roll-out that 
his priorities fall into line with that.
    And so as we put together our programs and objectives under 
GPRA, which, by the way, we have been doing for the last 4 
years in terms of performance management of the organization, 
while what we have been accomplishing, in my opinion, have been 
baby steps toward our goals, focusing not only on customer 
service and the things that I spoke to in my testimony, but 
also on the problems of the organization and our accountability 
for the results across the country.
    Mr. Sessions. Does that ever lead one, let's say, Secretary 
Cuomo, to believe that at some point the accountability would 
mean that someone would be cutoff from money or from budget or 
from something?
    Is this true accountability, if you don't perform we are 
not going to give you any money; we will not reward anything 
that you are doing? And likewise, do you think it would lead to 
a discussion of those areas that are doing well seeing that 
they get less scrutiny and more pats on the back?
    So, in other words, this process is going to lead you to 
doing something about the problem areas and then encouraging 
those proper things?
    Mr. Robinson. Well, Mr. Sessions, I would characterize it 
as continuing to do things in terms of what the record shows 
over the last 4 years under Secretary Cisneros and what 
Secretary Cuomo wants to accomplish.
    Just this past Friday, Secretary Cuomo conducted a review 
of our empowerment zones and enterprise communities and he 
pointed out in his comments that those who have made progress, 
we support that and we are going to work with them, and those 
who haven't, we are going to work with them, but he said he had 
no problems, if people didn't make progress, with the dire need 
for very limited resources and funds to moving those dollars to 
where it might be used better.
    So I think there is no question about that on the record 
from the Secretary just this past Friday.
    Beyond that, as we look toward making changes for those 
people who are performing and accountability--you mentioned how 
accountability would work. We are proposing in legislation 
again this year that we continue our efforts at deregulating 
public housing.
    There are certainly those public housing agencies out there 
across the country well-documented, who are poor performers, 
but there are likewise lots of public housing agencies that are 
doing a good job, and what we want to do is deregulate them and 
allow them to do the job that they do best at the local level. 
And that's been part of our legislative proposals in the past, 
and we are going to continue that as we move forward this year.
    Mr. Sessions. Good, and I think that that is good that we 
encourage those people who are doing the right thing.
    Let me ask you a question then about how you think Congress 
should look at GPRA and how you report versus--and I have got 
your annual--semiannual report to Congress, September 30, 1996, 
before me. And I have gone through and seen, without a fine-
tooth comb, problem area after problem area.
    Should Congress, if we look at what you are doing, from the 
agency where you are talking to every single housing entity 
within the given cities, should we say that if after you have 
done all you can do as an agency, you have given them 
assistance, you have warned them, you have tried to prod them 
into doing the right thing, should we then as a Congress come 
and say that we will take out specific money?
    Mr. Robinson. What we are proposing in our legislation is 
that while we work with people, those troubled public housing 
agencies as an example, as we work with people over time and 
try to assist them, and we have had unprecedented involvement 
on the part of HUD over the past 3 or 4 years in cities like 
Chicago, New Orleans, San Francisco, Philadelphia and Detroit 
across the country, and we have seen real progress in those 
areas, but in some of those areas where we have not been able 
to make progress, we are suggesting that there be more 
accountability in terms of takeover, judicial takeover, as we 
have seen here in Washington, DC.
    One of the reasons that we do not move forward in a very 
aggressive way in terms of taking back or lining out the 
dollars is that we don't want to remove all the services to the 
poorest people in our community in terms of their needs. And so 
from our perspective, if the public housing agencies can't get 
their act together is that there are ways of dealing with that, 
and we have demonstrated over the past several years our 
commitment to doing that, and Secretary Cuomo is committed to 
doing that. And that's in the legislation that we are 
introducing now.
    Mr. Sessions. Good.
    Mr. Robinson, I guess you have hit the essence of what we 
have talked about, and that is good money that taxpayers have 
provided for the right purposes that are intended to help the 
people who need it most, is our effort.
    Mr. Robinson. Yes.
    Mr. Sessions. That's what I think all taxpayers are after. 
But I believe that part of this process should mean that we 
expect results, and I can tell you from at least my own 
perspective, that we must get those actions, we must have 
accountability, or I am in favor of simply not giving out the 
money if it's going to be wasted.
    So I would hope that internally that this is not--it's not 
Pete Sessions saying this, I think you already feel this 
pressure under yourself, but I hope that there is a real 
discussion that goes forth from what you present to Congress 
about problem areas and how you are trying to resolve it to 
where these people who are in these various areas that have had 
problems producing and doing the right thing, that they will 
know that some punitive action could take place from within 
your agency.
    Mr. Robinson. Mr. Sessions, I would agree, and we don't 
always agree on either side of the aisle, but I can say that 
from HUD's perspective we have moved forward I think 
aggressively in putting forth not only legislation, but changes 
in the way we operate in terms of the programs that we deal 
with under Secretary Cisneros, and Secretary Cuomo is committed 
to continuing that; in fact, heightening that in his priority.
    We have done that in our budget and we will continue to do 
so in terms of what we do as we put forth our legislative 
packages and that will continue as we deal with how we run the 
agency utilizing GPRA.
    Mr. Sessions. Good. Well, I will look forward to seeing 
that because I know Secretary Cisneros and Secretary Cuomo are 
dedicated to this function. I will be watching with great 
interest to see how that is involved in your planning 
statements through GPRA.
    Now, if I could go to Mr. Dyer, please, and then I will be 
very brief. Essentially along the same lines, probably the 
easiest one to talk about is SSI. That has been a big problem, 
I believe, in not only administering, but making sure that 
accountability is there.
    Do you believe that within your agency, with what you will 
be submitting, that you are getting to the heart of your 
problems and how to resolve them?
    Mr. Dyer. Yes, sir.
    Mr. Sessions, as you know, in the SSI, we were just put by 
GAO on the high-risk list----
    Mr. Sessions. Yes.
    Mr. Dyer [continuing]. Over concerns about how it is being 
managed.
    For the record, I would like to say that several of the 
items that the General Accounting Office identified were areas 
that we had been working on and identified ourselves. In fact, 
many of them we have worked with the Congress on.
    For one, we have been looking at how to review who is on 
the rolls. And with the Congress we were able to get through 
legislation last year that allows us to do what we call 
continuing disability reviews, which is actually to go back and 
review the medical histories of the people to see if those on 
our rolls should continue to receive support.
    As a result of what we worked out with the Congress, we 
will be going from doing less than about 100,000 reviews 2 
years ago to, in the next 2 years, over a million a year. So we 
expect to be able to review everybody at least once every 3 
years. People who have certain kinds of medical issues that we 
think should recover quickly we will review on almost a yearly 
basis. So, yes, we have looked at problems. We have dealt with 
them.
    In terms of our strategic planning and where we are headed, 
we have identified issues which we are working on and we plan 
to address several others that were identified by GAO and 
ourselves.
    Getting back to your question of accountability, we do view 
ourselves as accountable to the American people and if we find 
that funds are not going where they should be or not being used 
properly, we are addressing it.
    Second, we plan, through our strategic plan, to increase 
our investments in some research areas and some policy-analysis 
areas to further be in the position to have good discussions 
with the Congress, and with the executive branch as to what 
other actions we may need to take.
    Mr. Sessions. Good. Thank you.
    The comments that I have directed to both of you today have 
a lot to do, in my mind, with how we should look at what is 
presented at the end of September, and how it should be a road 
map to the Congress to be able to work with the agencies on a 
going-forward basis. I think that's one of the things that we 
are going to have to struggle with, particularly in this 
committee, Mr. Chairman, looking at them, knowing that what you 
said you want to achieve, but then how do we hold you 
accountable then also?
    And so I hope that you will continue to make us aware on a 
going-forward basis what you are doing to hold your groups 
accountable, your offices and other people that you work with, 
and likewise how we should hold you accountable also.
    Thank you, Mr. Chairman.
    Mr. Horn. I thank you, and we will have another round. I 
yield 12 minutes to Mr. Davis, the gentleman from Virginia.
    Mr. Davis of Virginia. Thank you, Mr. Chairman.
    I have got a series of questions for Mr. Robinson. Mr. 
Robinson, let me just start by saying out in Fairfax, where I 
was on the county board for 15 years, I helped start the first 
shelter for the homeless; we did several senior housing 
projects that I was instrumental in setting up; many times we 
went without any Federal funding at all because I found the 
Federal regulations and rules and everything to be much more 
costly and not to give us the desired result of trying to give 
affordable housing to senior citizens.
    I was also co-author of a Statewide ordinance that mandates 
developers build a percent of affordable housing as part of new 
housing developments. So I would yield to anybody in terms of a 
commitment to try to get affordable housing.
    But, frankly--and this predates you so it's not personal at 
all, but I think HUD has been just not very effective in the 
way they have gone about things. You need to re-examine and 
start looking outside the box. You have talked about that 
earlier and I share Mr. Sessions, some of his concerns, because 
there is a problem out there I want to help solve.
    As you know, the act talks about discussions with 
stakeholders in the various departments. What stakeholders have 
you either consulted with or, I guess solicited comments from 
in your performance plans? Do you have an ongoing dialog or do 
you consult on an ad hoc basis? What is HUD doing about that?
    Mr. Robinson. First, Mr. Davis, let me say that I am very 
well aware of the efforts that you personally made and the 
renowned efforts that Fairfax County has made in housing over 
the years, and I am proud to say I am a resident of Fairfax 
County. But having said that, let me suggest that in reviewing 
the stakeholder--working with stakeholders under GPRA, we have 
actually brought together all of the constituency groups that 
we deal with on a regular basis to deal with not only the 
issues of HUD but how HUD is transformed in getting its mission 
accomplished.
    We have done that now for the past 2 years, first with a 
document we call Blueprint 1, under Secretary Cisneros, and the 
second document was called Blueprint 2, both aimed 
programmatically and operationally at transforming the 
Department and providing increasingly more flexibility to the 
stakeholders out there.
    So I would agree with you, the chairman mentioned my 
resume, and if you have read it you know I have been involved 
in housing for more than 20 years, and I would agree with you 
in terms of HUD's overall performance. But we think that we 
have made significant progress not only in how we run the 
program, but the results that we are getting and what we are 
projecting for the future.
    And I would note, as an add-on, that Secretary Cuomo 
understands and has stated very specifically that he does not 
see a difference between our mission for our programs and what 
we manage. And so bringing those two things together, I think, 
will get the outcome that we are looking for, not only under 
GPRA, but how we do our business across the board. So we have 
reached out to all of our stakeholders, I am talking about 
tenant groups, ownership groups, management groups, local 
government groups, State groups, congressional groups, in both 
a formal and informal way, and we expect to continue that.
    Mr. Davis of Virginia. OK.
    Let me just reiterate, I think talking to some of the local 
governments involved in this who are dealing with us on a day-
to-day basis, in many cases, it can be very illuminating 
because we share the same goals and the same mission statement, 
and we are partners in this. Sometimes the best--I certainly 
have authored some programs in the county with best of 
intentions, that didn't work out very well, and you just have 
to be honest when they don't work out, have this dialog and put 
the egos aside and move on. I think that's where we are right 
now, with HUD.
    I am not one of those who favors abolishing the agency 
because things haven't worked out. It's a great opportunity, 
may be the last chance. So this act, I think, gives us an 
opportunity to try to work together, reformulate a strategy 
together, the Congress and the administration, and the 
stakeholders and try to move on from there.
    Have you asked any organizations to help you with 
developing outcome measures at this point?
    Mr. Robinson. We have not asked any particular organization 
on the development of the measures themselves. We expect to do 
that but, quite frankly, while we think we have made progress, 
we have got to get much better in terms of the development of 
measures.
    And as I heard the discussion earlier today, the culture 
is, of course, output: How many of these, how many of that? And 
to turn to accountability in terms of outcome is a culture 
shift, I think for the whole Government and certainly for HUD; 
I can speak of HUD. So we are moving in that direction. It's 
incremental, but I think progress is being had.
    Mr. Davis of Virginia. OK. I don't mean to dis the other 
members on the panel, but out in Prince William Forest, which 
is working well--not a lot of agriculture--but I want to focus 
on housing here just because it has been so important to me. 
And I think this act gives us an opportunity to make some 
revisions in current policy on a bipartisan, if you will, both 
ends of Pennsylvania Avenue, everybody working together, and 
that's something that's been missing.
    Have you consulted, Mr. Robinson, with other Federal 
agencies to make sure that you and they are treating similar 
programs in a comparable manner, and who are you working with 
on that if you are doing it?
    Mr. Robinson. Well, we have a number of opportunities for 
consultation. You mentioned one, the CFO council, where we meet 
with CFO officers from all organizations.
    I am a member of the Presidential Management Committee 
which is run primarily through OMB, where we meet with deputy 
secretaries from all of the agencies in Government, and like 
committees of that sort. But we have specific consultations 
that we have undertaken, mostly through NPR, with HHS, with 
welfare reform being a major part of what's going on and 
housing being a piece of that.
    We certainly are working with them. We have been working 
with the Treasury Department in terms of affordable housing, 
how financing works and what the outcomes might be. Those are 
two that come to mind.
    Mr. Davis of Virginia. I was going to ask one other 
question, going back to a couple of questions before. In the 
stakeholders, have you talked with the construction people who 
are building these units and the financing people as well? Are 
they part of the stakeholders that you talked with in this case 
and ask for their input?
    Mr. Robinson. It's interesting. We held a couple of 
sessions, large sessions, about a year ago, we looked at design 
and how you build affordable housing across the country. 
Secretary Cisneros was very much interested in understanding 
the relationship between design and how things are put together 
and how its longevity was impacted and how it was able to serve 
public housing and affordable housing across the country. So 
the answer to your question is, yes.
    Mr. Davis of Virginia. OK. Now in testimony to the 
Subcommittee on Human Resources on March 6th, the IG of HUD 
referred to the Semi-Annual Report of the Congress that the 
Office of Inspector General of the U.S. Department of Housing 
and Urban Development issued on September 30, 1996. The report 
stated that despite improvement in some aspects of HUD's 
performance, HUD's capability to perform is limited by three 
fundamental issues that have gone unaddressed and can be 
expected to become more serious over the next few years.
    These are the number and the very types of HUD programs or 
initiatives that are significantly out of balance with the 
capability of the constantly dwindling HUD staff to carry out 
the program initiatives.
    Second, various components of HUD, especially the Office of 
Public and Indian Housing and the Office of Multifamily Housing 
are not equipped to provide reasonable stewardship over 
taxpayer funds expended for their program.
    And third, HUD's avowed commitment to a place-based program 
delivery approach is, in important respects, inconsistent with 
HUD's organization and authorities which follow discrete HUD 
program lines.
    Now, the IG suggested that a narrower, more precise 
definition of HUD's mission would help in the first instance, 
but would require a major shifting of authorities within the 
Department. She also suggested that development of systems that 
accurately measure program performance rather than just 
regulatory compliance were crucial, especially considering that 
HUD doesn't have the capability to carefully monitor all 
aspects of the huge program it has.
    How would you respond to those points?
    Mr. Robinson. Well, we respond in this way, Mr. Davis: 
Clearly, the IG has touched on a number of areas that have been 
ongoing problems within the Department of Housing and Urban 
Development, the problems that we believe and issues that we 
believe that we have begun to address over the past 4 years and 
will continue to do so.
    If I could go through them one at a time?
    Mr. Davis of Virginia. Sure.
    Mr. Robinson. No. 1, the number of programs, clearly we 
agree that the mission of the Department and the number of 
programs that it operates should be refocused, and we have 
documented that desire to refocus and reduce the number of 
programs, both in the two blueprints that I mentioned and in 
legislation that both we have written and supported, that was 
in the Congress last year.
    We will continue to document that in our congressional 
proposals that we are proposing this year in terms of the 
number of programs that the Department operates.
    Second, as far as Public and Indian Housing and the 
Multifamily Affordable Housing programs in what she refers to 
as--I call it the lack of talent--to keep up with the ever-
changing and fast-paced world, a very complicated world, of 
Multi-Family Housing Development and Finance, clearly we have 
had difficulty maintaining appropriate talent in that area.
    I believe that FHA Commissioner Retsinas has made major 
steps in that regard primarily through securing private and 
contractors to help us out--to help HUD out in securing the 
kind of information that we need, and more than that we have 
created swat teams across the country that will go in and focus 
in on the mismanagement of multi-family housing across the 
country.
    And then last, as far as the place-based approach is 
concerned, we would disagree with the IG. We believe that 
place-based is very important to us because we actually operate 
in places out there across the country, and what we want to do 
is have HUD resources be responsive to folks in the local areas 
and understand what's going on in the local areas and not 
necessarily have monitors with the one-size-fits-all attitude 
back here in Washington, DC.
    Mr. Davis of Virginia. I think when you boil all of these 
down, and, Mr. Chairman, I will turn it back over to you, is 
that you are in a changing era with limited resources. You are 
still trying to do too many things. And this is a good focus 
point for you, this whole exercise now, of trying to keep that 
mission and focus what we can do well with existing resources, 
and we are all counting on you and want to work with you to 
make that accomplished.
    I appreciate what you are trying to do, and don't look at 
us as the enemy here. We share the same commitment that you do 
and want to work with you to make it come about.
    Mr. Robinson. Thank you, sir.
    Mr. Horn. I thank the gentleman for his excellent 
questions. We will have a series of questions, so we don't 
detain you here this morning, if you don't mind, you are all 
under oath, and the responses, just if you would submit them, 
and we will put them in the record at the relevant places. Some 
of them are elaboration, Mr. Secretary, on the Inspector 
General's reports and so forth.
    Let me ask Mr. Stewart a few questions.
    We don't want you to feel that you are overlooked here.
    How much is the budget now of the Forest Service in a 
typical year, either the one just completed or the one now? 
What's your budget basically?
    Mr. Stewart. Roughly, $2.3 billion for fiscal year 1998.
    Mr. Horn. $2.3 billion.
    How much do you return to the Treasury as a result of your 
logging operations and your assistance to logging operations?
    Mr. Stewart. I don't have the number available offhand. I 
can certainly submit it for the record.
    Mr. Horn. Could we submit it for the record at this point?
    Mr. Stewart. Be glad to.
    [The information referred to follows:]

    In 1995, $27.9 million in timber receipts were returned to 
the Treasury.

    Mr. Horn. I am interested in the degree to which the Forest 
Service, in looking at its vast resources throughout the 
country, is looking at options as to its present mission. For 
example, I think historically the Forest Service has been 
obviously able to preserve this great resource around the 
country, manage it correctly and make it available in most 
cases, to private timber in terms of logging operations, some 
of which are beneficial to the forest--I know there are 
arguments on this in the environmental community--and some of 
which aren't.
    But one major option comes up, and that is to what degree 
should the U.S. Forest Service and its national forests be 
involved in recreation as opposed to growing trees for the 
purposes of logging? Now, you can do both. Obviously, it 
depends on the analysis of the particular forest involved.
    What's your feeling on that and to what degree is that goal 
becoming part of the Government Performance and Results Act as 
far as the Forest Service is concerned?
    Mr. Stewart. Mr. Horn, I would say that one of the things 
or three consistent comments that came out of our public 
involvement on the draft RPA program is people in general are 
asking for greater emphasis within the Forest Service on 
protection of the environment as opposed to development.
    They agreed either with just sort of the broad, general 
direction that we have identified in the draft RPA program or 
they have at least agreed with specific components of that 
program. But the crux is, many of them say that they want a 
more obvious statement of our multiple-use mandate and what 
that means.
    As you know, we are mandated to have a broad multiple-use 
of the National Forest and that includes commodity and 
noncommodity uses, recreation being one of those. Certainly 
recreation is a key one. We are the largest recreation 
provider, I believe, of all the Federal agencies at this point 
in time. It has always been very important to us throughout our 
history.
    Mr. Horn. That includes the National Park Service, I 
assume, as a comparison. Do you base that on the number of 
people that access the forest for recreation or those campsites 
primarily, or what's the measurement there?
    Mr. Stewart. We use a measurement called Recreation Visitor 
Days, RVDs, and it is based on--I believe it's a visit of one 
person for an 8-hour period, so it's not just a passing 
through. It's on a sample basis. And it is developed and 
disbursed in campgrounds as well as hiking and people driving 
through, it takes a number of those to account for one 
Recreation Visitor Day.
    But the focus of the debate is not on the multiple-use 
mandate but on interpretation of it and how much emphasis 
should go into commodity versus noncommodity programs. And it 
clearly has become a key of the discussions we have been having 
within the agency as part of GPRA and as part of developing the 
RPA plan, the Secretary's recommended program. So in answer to 
your question, yes, it is playing very heavily in that 
discussion.
    I believe the agency is going to continue to support a 
multiple-use mandate, not eliminating any of the uses, but I do 
see the possibility that there will be shifts.
    I think, depending on who you talk to, and depending on 
whether you are in a local community or you are talking at a 
national level, there is a great deal of difference in opinion 
about what that mix ought to be.
    I would say, generally, in local communities that are 
dependent upon the local national forest, they tend to want to 
focus on commodity development. As you move away from those 
forests, people tend to focus on noncommodity, the visual 
assets, wildlife and so forth, and those are all important to 
our mission. So this debate is helping us try and formulate 
what that mix ought to be, but I do believe that we are going 
to end up supporting the multiple-use mandate, and generally 
the public does.
    Mr. Horn. Noting your comment on the number of people that 
pass through a forest, I have to ask you the question: Are 
there any national forests where an interstate highway or a 
major thoroughfare goes through the forest?
    Mr. Stewart. I am familiar with one. I came from 
California, and the main interstate out of L.A. going east goes 
actually on the border between the San Bernardino and Angeles 
National Forest.
    Mr. Horn. So conceivably, one could count the traffic there 
and, say, divide 8 hours in the number of minutes and come up 
with some conclusion? I am just curious.
    Mr. Stewart. I would like to believe we use a little common 
sense on that one.
    Mr. Horn. Yes, because I think those measures can make a 
lot of us nervous, shall we say.
    I am interested in the degree to which the Inspector 
General's comments have been taken serious by the Forest 
Service. I looked at one of his comments on the financial 
statements that got his adverse opinion from the auditors 
apparently, and this means that the auditors found the 
financial information provided in the report to be unreliable, 
in other words not accurate.
    How does the inability to provide accurate financial 
information affect your ability to implement the Government 
Performance and Results Act? Is that a major problem?
    Mr. Stewart. Yes, it is Mr. Horn. And, in fact, that 
adverse opinion has caused a lot of inner introspection within 
the Forest Service. And we currently have a team that is 
jointly made up of members of the Forest Service, the Office of 
Inspector General, and the Office of the Chief Financial 
Officer of USDA. We have a plan laid out, an action plan, with 
specific timetables in it, specific actions to be taken to have 
us result in getting a favorable opinion in as short a period 
of time as possible. We are working through that plan. There is 
a lot of energy and effort going into that.
    I think, basically, the three parties, the Forest Service, 
the Chief Financial Officer, and the Inspector General, are 
pleased with the progress; at least, that is my understanding 
to date. But certainly, if we can't adequately account for the 
financial resources, that also included property resources in 
that finding, then it is going to be difficult to fully 
implement. And partly as a result of that, we are putting a lot 
of energy into trying to correct problems.
    Mr. Horn. In other words, in a particular national forest, 
the Forest Service has difficulty in putting an actual price 
tag, I take it, on the assets as well as the budget related to 
the administration of that forest. Is that what our main 
problem is, we can't really look at this and analyze it in a 
fiscal sense?
    Mr. Stewart. That is at least a major part of the problem.
    Mr. Horn. What are some of the others that make the data 
inaccurate?
    Mr. Stewart. Having adequately trained people and 
accounting methods is part of it; the financial reporting 
systems that are integrated from one time entry all the way to 
the top so that you can accumulate information easily and 
readily throughout the organization; having the resources 
available to actually do the valuating of the property, putting 
a value on it. Again, all of those have been identified as 
portions or parts of the action plan and are being worked on to 
correct those deficiencies.
    Mr. Horn. You mentioned commodity groups, and we have 
mentioned conservation and environmental groups. How are we 
resolving the disagreements among these different groups, 
environment, conservation, commodity groups, as to the mission 
of the Forest Service? What kind of a framework are we bringing 
them in to share their views and thoughts?
    Mr. Stewart. As you probably are aware, as of the start of 
this calendar year, we have a new chief, and Chief Mike Dombeck 
has made a priority and consistently said and sent a message 
that he expects what he calls collaborative stewardship, and 
that is to get people at the table who have an interest and 
begin working out the solution.
    The agency's history is as the professionals, we always 
thought we had the answer, and I think what we are finding in 
today's environment is that that is not working very well. So 
the role of the Forest Service shifts to being the facilitator 
and convener of those discussions and to providing the 
technical background so that the discussions are within the 
biological limits of the forest or the rangelands that we are 
dealing with and then helping communities of interest come up 
with solutions that are workable.
    That is a whole new role for us, and a number of people are 
taking training in the process. There have been some local 
districts and forests within the Forest Service that have been 
doing that for years, and quite successfully, and suddenly we 
are beginning to look at what they were doing and learning from 
that. So I look at sort of I wouldn't say evolutionary change, 
I would say revolutionary change in how we do business in the 
future. It is going to be much more collaborative and much less 
dictatorial on the part of the agency.
    Mr. Horn. That is a very interesting comment. I have great 
respect for the Forest Service over the years. It has been one 
of the Government's premier public service groups, and there is 
a lot of fine forestry schools around America, and I am just 
curious, are they forestry schools working on that 
collaborative aspect that the chief is talking about where they 
educate future foresters in terms of the importance of the 
environmental conservation aspect in relation to the commodity 
aspect? Do you see that change in curriculum coming?
    Mr. Stewart. I suspect it will. There are some universities 
already that have programs along that line. Whether they have 
actually incorporated it in the forestry program, there is 
always this dichotomy. There is so much professional 
requirement, science background needed, and there is always a 
tradeoff. But I can't imagine that the national resource 
professional of the future is going to get by without having 
better dealing with people and resolving conflict.
    Basically, when I went to forestry school, we basically 
dealt with managing trees, and it was quite a surprise to find 
out there were a lot of people out there, too. It was much 
easier to deal with the trees; they don't talk back, and they 
don't move around. It was just handed to me, Yale Forestry 
School, of course, which was the first forestry school in the 
United States, has a leadership program, and part of that 
leadership program is teaching these collaborative 
decisionmaking skills.
    Mr. Horn. Now, is that while they are getting their 
forestry degree, or is that post-degree education?
    Mr. Stewart. I think it is post, as I recall. We actually 
bring people into that program.
    Mr. Horn. Well, I think it is too bad that we haven't 
started earlier. They ought to really be getting this phased in 
that they relate to people in the real world. And that is true 
of a number of professions. I am not picking on the Forest 
Service. Let's start with the medical health professions where 
we have that problem also. You can be a brilliant surgeon, but 
you might not be very good on understanding people, and that 
has been sort of the surgeons' rap over the years.
    Let me go into depth a little bit on this OTA report, 
Office of Technology Assessment. They issued this report 
entitled ``Forest Service Planning, Setting Strategic Direction 
under the Performance Results Act,'' and it looked at the 1974 
act, and then in July 1990 sort of analyzed where were you. It 
was requested because of a certain feeling in Congress that the 
results and performance goals had not been set in a strategic 
direction for the Forest Service planning at the national 
level, and what they found in the 1989 assessment was that 
there were very serious shortcomings, and for many resources 
there were no data on resource conditions, and there was no 
evaluation of investment opportunities, and there was 
insufficient information on cooperative assistance and research 
needs and priorities, and that the claims made were not 
substantiated.
    For example, they gave the timber situation. Two measures 
of public concerns were acres clear-cut, acres of old-growth 
forest, and they were discussed, but with no supporting data on 
conditions or trends. So what the Office of Technology 
Assessment concluded was much of the information in the Results 
Act documents are incomplete, of poor quality, and that the 
resource inventories in the assessment scarcely provide 
sufficient data on the quantity, the quality of the outputs of 
each resource to analyze opportunities to improve resource 
management. Some of the information they said is based on 
surrogate measures or on professional judgments, which we have 
been discussing. And then they argued better data are needed; 
better data will not automatically lead to better planning, but 
could settle debates on what is and focus attention on what 
should be.
    What this report presumably is telling the Congress is that 
the Forest Service really doesn't know what the data are. We 
have agreed on the financial data, and that report is 1990, and 
we read the audit in 1995, and the question is obviously did we 
improve in that 5 years; otherwise why the audit problem? But 
there are data besides financial data, and I would ask to what 
degree is the Forest Service assured that the nonfinancial data 
are accurate, relevant, helpful in the measurement part? I 
wonder if you just want to react to that?
    Mr. Stewart. That, Mr. Horn, is a good question. I would 
begin by saying that I agree with Mr. Robinson that we are 
better at measuring inputs and outputs and less at outcomes, 
and as we have begun to define the outcome as being healthy 
forests or healthy rangelands, the difficulty of defining 
health all of a sudden comes to the forefront. And that is 
something that you can measure at a point in time, but 
measuring progress toward improvement takes good trend data.
    One of the things that has occurred over the last year is 
we have formed an Inventory and Monitoring Institute. As you 
know, we are responsible for the national forest inventory, and 
that increasingly is becoming more integrated and more a multi-
resource. Rather than just timber, it is beginning to look at 
other resources also. One of the roles of that institute is to 
assure the quality of the data, the consistency of the data, 
and the fact that it does add up across the country.
    We had joined in partnership with other natural resource 
agencies to jointly define what kinds of measures do we need to 
adequately measure things like forest health or sustainability, 
which is another issue, so that we are using consistent 
definitions and consistent data when we are presenting our 
information.
    We have partnered up with the Natural Resources 
Conservation Service, the sister agency within USDA, in their 
inventory efforts, so that we are taking common information and 
even have common plots. Again, I think that is going to improve 
the quality of our data.
    So, as I mentioned earlier, it is an iterative process. We 
are beginning to move away from just measuring things and begin 
looking at what is it we are trying to achieve on the lands; 
what does the land need to look like, and how do you measure 
those? The tradeoff is always going to be between the two 
extremes, those who want to measure everything, which you can't 
afford to do, and those who want to measure very little. And 
somewhere in the middle is where we need to be, and that is one 
of the purposes of the Inventory and Monitoring Institute is 
find out what is that set of information, what is most 
important, which will be things like forest health and 
sustainability that will be measured across ownerships and 
across different kinds of management strategies also.
    So it is a problem. We are working on it. We are beginning 
to implement in a broader scale something called forest health 
monitoring. The intent eventually is to have it in all 50 
States, and it is being lined up efficiently and effectively 
with our forest inventory efforts. We are using the same plot 
designs. And it will expand the usefulness and accuracy of that 
kind of information. So there are a number of initiatives going 
on that over the next couple of years will begin to bear fruit.
    Mr. Horn. Well, that is very helpful, and you have stated 
the reaction very well.
    Let me to move to Mr. Dyer from the Social Security 
Administration. One of the concerns that we expressed in the 
earlier part of the hearing is the degree to which the Social 
Security Administration would be able to work with other 
Federal agencies in terms of tracking data on the success of 
some programs, and what we were talking about was worker 
retraining or worker re-education.
    I think all of us are visited probably twice a year by 
members of private industry councils who have Federal money 
they are using to help meet the job needs of a particular area 
of the country with different occupations involved. There is no 
simple cookie-cutter approach. But the real question is, how 
effective is the training? Are we getting our money's worth? 
And I think the only way we will know is if we find what 
happened in the job experience of those individuals that they 
gave 6 months' training to or a year's training, and the only 
way we are going to know that is if the Social Security 
Administration will tell us where they are, what are the 
payments going to these workers now, did they improve?
    Tracking them is the excuse always for not having those 
data. And I just wonder what is the situation in the Social 
Security Administration in terms of the laws involved that 
would prevent one Federal agency which is subsidizing re-
education for a workforce, and this is part of the President's 
agenda obviously, and another Federal agency which knows where 
that individual is in the workforce from cooperating together.
    Could you sort of give us a bird's-eye summary of that 
situation in terms of either the privacy laws as they pertain 
to Social Security or to what degree are you cooperating now 
with other Federal agencies?
    Mr. Dyer. Mr. Chairman, we have been working very closely 
with other Federal agencies in terms of coordinating our 
programs with theirs. And there is a flip side, too. We are 
very interested that people on our programs, particularly in 
supplemental security income or disability under Title 2, are 
able to go back to work if they want to, if they can work. So 
we are very interested in the same thing. We ourselves have 
been running pilots, and this year we have worked out an 
initiative in the President's 1998 budget which allows us to 
start moving toward how to return people to work.
    Mr. Horn. Would you get the mic a little closer. I am 
having difficulty hearing you. Just move it toward you.
    Mr. Dyer. I am sorry.
    In terms of your second question of sharing data, 
generally, if it is for research purposes and very broad, that 
does not give us too much problem as to how we share it because 
we do not identify the individual. So for large-scale studies 
we work with agencies and do share data.
    Where we get into privacy concerns is when it is for 
individuals and how you are going to use it. Generally, though, 
with other Federal agencies we are able to work out those kinds 
of arrangements so that they assure us as to how they are 
handling the data.
    I note from our end, we do matches with other agencies 
themselves to see what is going on, who is in what program, and 
what is happening, particularly, for instance, in the 
unemployment insurance world. And it is something we would be 
glad to work with other agencies on. I think it is of interest 
to all of us.
    Mr. Horn. Have you ever had an opportunity to work with 
those private industry council programs that are funded by the 
Federal Government?
    Mr. Dyer. I am not the expert in the agency on this, Mr. 
Horn, but we do have a lot of contact with a lot of various 
groups that are involved in rehabilitation or mental health or 
whatever, and I am sure many people on our staff have worked 
with them.
    Mr. Horn. Who would be the best person for the subcommittee 
to contact?
    Mr. Dyer. Our Associate Commissioner for Disability, Susan 
Daniels.
    Mr. Horn. OK. So the Disability Associate Commissioner's 
realm would cover this matter?
    Mr. Dyer. Most of it, yes, sir.
    Mr. Horn. Good. That is very helpful.
    Now let's turn to the General Accounting Office in closing 
this out. Anything you heard this morning that you would like 
to comment on for the record and advise us whether that helps 
us move toward the goals of the Government Performance and 
Results Act or deters us from achieving the goals?
    Mr. Stevens. Mr. Chairman, I think we have heard a variety 
of experiences. We have a variety of agencies just within the 
three that are up here. We have the Social Security 
Administration, which I think has had quite a readily defined 
set of responsibilities, more so than the Forest Service, 
which--for example has got a mix of responsibilities, some of 
which may indeed be conflicting, certainly which are changing.
    There was a good deal of discussion, it seems to me, on the 
need for good data arising from all of these programs and the 
emphasis that GAO has put over the years on the production, the 
maintenance and value of the kinds of information on 
performance and costs of these programs, it seems to me, just 
to be a starting point for anybody making progress in these 
areas. And with HUD, of course, that is probably a more serious 
problem, but apparently, according to Mr. Robinson, it is being 
addressed.
    We have commented at some length on each of these agencies 
and their performance. I think GAO probably tends to pick out 
some weak points that weren't emphasized by the witnesses up 
here, but if I were in their position, I wouldn't emphasize the 
weak points either.
    Mr. Horn. Well, we will try to elicit those in the followup 
questions.
    What would you suggest this subcommittee might do in terms 
of prodding the system along to be successful in carrying out 
the law as far as the strategic mission, as far as the 
measurements related to that and so on down the line?
    Mr. Stevens. I think there are two focal points. One you 
are doing with the agencies themselves. I think the oversight 
committees have a very broad role there and knowledge of GPRA, 
what agencies' responsibilities are under it. If they are 
called up to testify before Congress, they are expected to find 
out about this and presumably have something positive to say.
    I think probably the greater challenge, however, is to work 
within the Congress itself. We have maintained for a number of 
years, based on our conversations with agencies, that unless 
Congress uses the kinds of information and analysis that the 
Government Performance and Results Act was designed to achieve, 
unless it asks questions based on that information and 
agencies' self-assessment, and unless it acts on the answers 
that it gets in its own real decisionmaking process, despite 
the fact that GPRA is a law, it could still fade into 
irrelevance as many other management initiatives have in the 
past.
    It is ultimately going to depend on whether Congress really 
uses it, and there I think the role of this committee--this 
subcommittee is of critical importance in bringing on board a 
number of committees that themselves are just beginning to find 
out what it is all about.
    Mr. Horn. I think that is well said.
    I would also like to put a stress on the Office of 
Management and Budget using the data and measurements when they 
dole out resources and decide whether there will be a plus or 
minus this year for a particular agency. And it seems to me we 
need to make sure that in their budget go-arounds that we can 
get measurement data that both the executive branch and the 
legislative branch agree make some sense. Then we are a long 
way there in analyzing particular programs.
    And I have always been bothered by the fact that we can't 
get agreement between OMB and CBO, the Congressional Budget 
Office, as to projections on the economy. It just seems to me 
there ought to be a way to work out some of those things so we 
don't have rosy scenarios, as they say, at either end of 
Pennsylvania Avenue. And I think GAO could be immensely helpful 
in continuing to be a neutral critic as to what is going on, 
and we are going to count on you for that resource.
    So I thank you all for coming.
    I have one announcement before I thank the staff, and that 
is that there are no further questions. We are going to thank 
you for being here. And the second session of this hearing will 
take place 10 a.m., Thursday morning in the same room, and we 
will be hearing from Mayor Rudolph Giuliani of New York City on 
the privatization Government reform initiatives in that major 
city. And we will stand recessed until 10 a.m., on Thursday, 
March 13th.
    I now thank the following people who have put this hearing 
and will put the next one and a few others together, and that 
is the staff director, J. Russell George; Anna Miller, 
professional staff member to your left; John Hynes, 
professional staff member, on the side; Andrea Miller, our 
clerk, who set up the hearing; and then David Bartell, my chief 
of staff next to the staff director; and our
friends on this side, one is missing, David McMillen, Mark 
Stephenson, professional staff members for the Democratic 
minority; and our court reporters, Ryan Jackson and Mindi 
Colchico. We thank you all for your role in this, and we are 
now recessed.
    [Whereupon, at 12:22 p.m., the subcommittee was recessed.]







 GOVERNMENT PERFORMANCE AND RESULTS ACT IMPLEMENTATION: HOW TO ACHIEVE 
                                RESULTS

                              ----------                              


                        THURSDAY, MARCH 13, 1997

                  House of Representatives,
Subcommittee on Government Management, Information, 
                                    and Technology,
              Committee on Government Reform and Oversight,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:10 a.m., in 
room 311, Cannon House Office Building, Hon. Stephen Horn 
(chairman of the subcommittee), presiding.
    Present: Representatives Horn, Maloney, and Davis of 
Illinois.
    Staff present: J. Russell George, staff director; Anna 
Miller, Mark Uncapher, and John Hynes, professional staff 
members; Andrea Miller, clerk; David McMillen, minority 
professional staff member; and Ellen Rayner, minority chief 
clerk.
    Mr. Horn. The Subcommittee on Government Management, 
Information, and Technology will come to order.
    I have just come from another hearing, the DC Subcommittee, 
where the Mayor of the District of Columbia is testifying, as 
well as a number of other people.
    And I mentioned our series of hearings on results-oriented 
government in terms of the Government Performance and Results 
Act, and noted that you were going to be here as a witness, 
Mayor Giuliani. I mentioned that I would like to see the same 
results that you have established in New York City established 
in the District of Columbia.
    Right now, only the State of Oregon has a results-oriented 
government. Australia and New Zealand do. And we just do not 
talk about hey, give us some more money. Because we have a 
great idea. We look at a plan to get something done, and the 
citizenry to participate in evaluating that plan, to see if we 
are getting results.
    So this hearing is a continuation of a series that began in 
1995, and will increase in number, simply because we want to 
see how well the Federal Government is doing it. And we had 
several agencies testify last week in terms of Social Security, 
and the Forest Service, and HUD. And, of course, this hearing 
will focus on what has been accomplished in local government 
with you as one of the major leaders in this area.
    I think that you and I would agree that the voters are 
clamoring for the kind of reform that has results. And no one 
will deny that they deserve such reforms. And, of course, our 
question is, what can Congress do to expedite the process? 
Certainly, we have a role at the Federal level. The question 
would be what kind of role do we have, if any, at the State and 
the local level?
    We have learned during these hearings that results can be a 
powerful instrument for reform if we are industrious and 
vigilant. But we also have to be thoughtful and innovative. We 
cannot assume that the Results Act will do all of the thinking 
for us. We must constantly search for successful reform 
examples such as your own.
    Luckily, one need not look far. And that is why we asked 
you to join us and share your experience in terms of the police 
department in New York City. And the issue of crime, as we all 
know in this room, anybody who knocks on a door in any 
precinct, that is what worries people. The quality of 
education, and the quality of our control of crime by youth 
gangs and others who are disruptive of our society and our 
opportunities.
    So we are going to be very interested in the broad 
strategic changes that occurred in the New York Police 
Department. And we look forward to your testimony.
    [The prepared statement of Hon. Stephen Horn follows:]
    [GRAPHIC] [TIFF OMITTED] T2636.036
    
    Mr. Horn. Mr. Mayor, I am going to swear you in, and then 
have your distinguished New Yorker and Staten Islander, and our 
distinguished colleague, introduce you to us. All of our 
witnesses are sworn in here, if you do not mind, Your Honor. If 
you would raise your right hand.
    [Witness sworn.]
    Mr. Horn. The mayor has affirmed.
    And I am now delighted to introduce the distinguished 
Member from New York, Ms. Susan Molinari. Thank you for coming.
    Ms. Molinari. Thank you very much, Mr. Chairman. And thank 
you for giving me an opportunity to introduce a man who has 
become very special to the people of New York City. He is a man 
who has devoted most of his adult life to Government service. 
And I am just going to go through a brief background, because I 
think it sets the stage for where he gained a lot of his 
experience that he has implemented in New York City, and we are 
grateful for that.
    Out of law school, he clerked for a Federal judge in 
Manhattan. He then joined the U.S. Attorney's Office, where he 
became chief of the narcotics unit at the age of 29.
    He served as Assistant Attorney General here in Washington, 
DC, and returned to New York as U.S. Attorney for the Southern 
District, where he accumulated over 4,000 convictions, many 
against organized crime figures notorious for their previous 
ability to escape justice.
    Since becoming mayor of the city of New York in 1993, Rudy 
Giuliani has taken a number of steps to improve the quality of 
life for New Yorkers. But I daresay, as you correctly pointed 
out, nothing has been more impressive or important to us than 
his bold initiative to fight crime, regardless of the severity.
    From fare jumping at subway turnstiles, to truant officers 
at New York City schools, and dealing with and effectively 
prosecuting murders, the mayor knows that the first priority of 
Government is protecting its citizens. If people feel safe, 
they are likely to raise a family, buy a home, or just enjoy 
the best city in the world.
    As a result, New York City is attracting both new 
businesses and old friends that had left. And with these 
businesses come employment opportunities; 110,000 new private 
sector jobs have been created in the past 3\1/2\ years. Think 
about that, 110,000 new private sector jobs.
    This is a dramatic reversal from the previous 4 years, 
where 400,000 jobs were lost to New York. This all amounts to 
economic growth and opportunity, growth and opportunity which 
naysayers thought were long gone from New York City.
    But as you know, we New Yorkers are a tough bunch. And just 
when you think you may have us on the ropes, we come rallying 
back.
    As the mayor of New York City with a population of 8 
million people, and a number that doubles just about during the 
course of a day, some of the mayor's accomplishments include, 
and I know that he will go into detail as to how he gets there, 
but I am just so proud of what he has done that I have to take 
this opportunity to brag a little bit.
    A 38 percent reduction in crime since 1993, including a 50 
percent drop in murder. Reining in a bloated and often wasteful 
bureaucracy by reducing the number of Government jobs. 
Eliminating, I think, 21,000 without direct layoffs.
    Directing educational resources on teachers and classrooms 
and not on administrators. And undertaking the most ambitious 
Welfare to Work program in the city's history, moving 37,000 
people off welfare and onto jobs.
    And I can tell you, Mr. Chairman, when I served on the New 
York City Council, we had a tough time dealing with a pilot 
program that was going to get welfare mothers to work, 500 of 
them. We could not pass that in the city council. And Mayor 
Giuliani has been able to create miracles in that city that we 
did not believe could be duplicated anywhere in this country. 
The mayor's effects are indeed achievements for which he should 
be commended.
    While not equal in size or scope of the entire country, New 
York's successes point to how an accountable government can be 
an effective government. It is a recipe for success in a big, 
complicated city, a small town, or the entire United States.
    Mr. Chairman, I am very proud of the man who is sitting 
next to me. He has brought back a spirit of discipline, of 
hope, of exuberance, and of anticipation to a city who thought 
those were qualities that were long gone. He has made a 
difference for just about every family in the city of New York 
by dedicating every waking hour, and I have to say knowing 
Rudolph Giuliani, that is about 20 hours of the day, to 
improving the quality of life for New York City.
    I am very proud to introduce the mayor of New York, Rudolph 
Giuliani.
    Mr. Giuliani. Thank you very much.
    Ms. Molinari. It is my honor.
    Mr. Horn. And thank you.
    Mr. Giuliani. Good morning. Mr. Chairman, and members of 
the subcommittee, and Congresswoman Molinari, I am very pleased 
to be here. And I thank you for giving me the opportunity to 
speak with you.
    Mrs. Maloney. First, Mr. Mayor, could I welcome you also?
    Mr. Giuliani. Please.
    Mrs. Maloney. And my colleagues. And I ask that my opening 
statement be placed in the record as read.
    I must say, Mayor Giuliani, I never thought in my wildest 
dreams that New York City would be held up as the poster child 
for achievement in controlling crime for the Nation.
    In fact, in the last election, some Republicans complained 
that the President was using New York City and the national 
crime statistics, and New York City was driving down the 
national crime statistics due to the tremendous success that we 
have had in New York City with your leadership.
    And also, I think that we have the best police department 
in the world. There is no question about it. They are the 
bravest, the most innovative, and actually the best in every 
way.
    And I must say that the President's anticrime proposals 
have helped bring moneys to New York City for additional police 
officers and certainly the ban on assault weapons.
    So, I am very happy for my constituents and for New York 
City with the success of bringing crime down in New York City. 
And I am very pleased to welcome you here today. And, as 
always, I look forward to what you have to say.
    [The prepared statement of Hon. Carolyn B. Maloney 
follows:]
[GRAPHIC] [TIFF OMITTED] T2636.037

[GRAPHIC] [TIFF OMITTED] T2636.038

[GRAPHIC] [TIFF OMITTED] T2636.039

     STATEMENT OF RUDOLPH W. GIULIANI, MAYOR, NEW YORK CITY

    Mr. Giuliani. Thank you very much.
    Thank you, Congresswoman Molinari, Congresswoman Maloney, 
and Mr. Chairman.
    The fact is that the things that we are going to talk about 
are very much geared to your introduction. What we tried to do 
from the day that I became mayor is turn New York City into a 
results-oriented Government, and then spend time trying to 
figure out what is the result that you actually want to 
achieve.
    The results that I am going to talk about, which are very 
positive ones, are the product of very good teamwork within all 
of the agencies of the city, and community groups, by the fine 
representation that we have in Congress; Congresswoman Molinari 
and Congresswoman Maloney, and all of you who represent us 
here. This is very much a team effort.
    Although I will describe what my administration has done, 
none of it would be possible without the very strong support of 
all of you. And I thank you very much for that.
    The Government Performance and Results Act comes in 
response to an overwhelming desire on the part of the American 
people to see Government become accountable and efficient.
    In New York City, we have seen how effective management can 
yield successful results. New York City has become known as a 
place that now welcomes growth, welcomes progress, and welcomes 
new ideas.
    As Congresswoman Molinari pointed out before, there was a 
period of time in which you were not allowed to have a new idea 
in New York City. And we tried to create the groundwork and the 
ability for people to propose new ideas and to deal with some 
of the most important and difficult problems that the city 
faced.
    In the late 1980's and the early 1990's, it was my fear 
that New York City--that when people said those words, the two 
things that would come to mind quicker than the great 
advantages of New York City, and the arts institutions that are 
there, and educational institutions, the two things that would 
come to mind first were crime and welfare. Crime, a city to 
which people were afraid to come. And second, a city in which 
people thought that welfare was really breeding dependency in 
not moving people back to work.
    So we tried very hard to put tremendous emphasis on turning 
around those two things, and to come up with a measure of 
success. The charts that I have here show the results in the 
area of crime. And again, since what you are looking at is 
measuring results, these are the results measured by the FBI.
    The first chart on the left shows what happened to the 
overall number of crimes as measured by the FBI. And New York 
City now has a level of crime that is lower than any time in 
the 1990's, the 1980's, the 1970's.
    In fact, the crime rate last year was lower than in the 
year 1968. So there is the number, 386,000 serious crimes as 
measured by the FBI. The last time that we had a year like that 
was in 1967. And these are FBI statistics, not our own 
statistics. So this is the way that the FBI measures crime.
    Or another way to look at it is the chart right next to it, 
which shows the reduction in crime in New York City over the 
last 3 years. New York City has the largest reduction in crime 
of any city in the United States over the last 3 years, 31.9 
percent. San Diego is right behind with 29.5 percent. Los 
Angeles with 22.9 percent.
    And just to show that it is not a national trend, some 
major cities during this same period of time have had fairly 
sizable increases in crime. And you see them at the bottom of 
the chart.
    So yes, there are things that are happening nationally. But 
the fact is that reductions in crime of this magnitude are not 
happening in every part of the country.
    This chart, which is a little hard to read, shows where New 
York City now ranks among cities with populations of 100,000 or 
more. According to the FBI, mid-year last year, New York City 
was city No. 144 for the possibility of being a victim of a 
crime in the United States. City No. 1 was Atlanta. City No. 
144 was New York City. And virtually every city in America has, 
per capita, more crime now than New York City.
    This is a very different picture than existed 3 or 4 years 
ago. It is actually a little startling, and people do not 
believe it. They do not believe that New York City is 144 out 
of a group of 187 cities. And cities like Little Rock; and 
Phoenix; and Richmond, VA; and Rochester, NY; and Omaha, NE; 
and Boston; and Buffalo, NY; and Albany, NY have more crime per 
capita than the city of New York.
    This is not in any way to demean them. It is just to deal 
with a stereotype that New York City is the most dangerous city 
in America. It is just the opposite. It is city No. 144.
    Mr. Horn. I might add that with these charts and tables, 
they will be put in the record at this point.
    Mr. Giuliani. Thank you very much, Mr. Chairman.
    [The information referred to follows:]
    [GRAPHIC] [TIFF OMITTED] T2636.040
    
    [GRAPHIC] [TIFF OMITTED] T2636.041
    
    [GRAPHIC] [TIFF OMITTED] T2636.042
    
    [GRAPHIC] [TIFF OMITTED] T2636.043
    
    Mr. Giuliani. And this shows the decline in New York in 
June 1995 to 1996. This is the last one audited and measured by 
the FBI. The decline nationally was 3 percent. The decline in 
other major cities was 4.3 percent. The decline in New York 
City was 10.5 percent.
    This is the point that I believe Congresswoman Maloney made 
before. The fact is that New York City makes up about 40 to 45 
percent of America's crime decline. And without that 
percentage, America would have had a very negligible crime 
decline. So in a way, New York City is doing something that 
people never thought was possible.
    The real question is why is that coming about, why is that 
happening? These results were achieved, because we carefully 
rethought the way that the police department should operate. 
And the strategic missions that we came up with proved to be a 
resounding success.
    Times have changed, and we have made critical improvements 
in the way that the department does its work, establishing 
separate strategies for dealing with guns, for youth crime, for 
drugs, for domestic violence, for auto-related theft.
    We have paid special attention to the key objective of 
improving the quality of life in public spaces. We found that 
implementing the broken windows theory, which says that 
sometimes the things that were being ignored because they were 
too small to pay attention to, because you were ignoring them 
so often and creating such immunity on the streets, that it was 
really leading to the more serious crimes.
    We had a period of time in the city in which that 
philosophy and theory was carried to such an extent that street 
level drug dealers were not arrested by the police, because it 
was thought that we had more important drug dealers that the 
police should be concentrating on. So entire streets and 
neighborhoods were turned over to drug dealers.
    I reversed that, and we increased the number of arrests of 
street level drug dealers by 30, 40, and 45 percent. We still 
cannot arrest all of them, but we do not have to give them 
immunity.
    We focused very carefully on something that I think was a 
New York phenomena--squeegee operators. Squeegee operators were 
people who would come up to your automobile, and ask you for 
money in order to clean your window, but very often intimidated 
people into giving that money.
    And we decided that we had to change that, that we had to 
do away with them. We had to enforce the laws against 
interfering with traffic, which always existed, but were being 
ignored. And what we found was that half of the squeegee 
operators were wanted felons, very often wanted for crimes like 
murder, rape, mugging.
    So in fact, two things happened. We created a safer 
environment, and we removed from the streets people who 
probably were going to engage in repeating their criminal 
behavior, like mugging, rape, and murder, if they had not been 
caught specifically for squeegee operations.
    Within a year and a half of taking office, our 
administration achieved a merger of the three police 
departments in New York City, which had always been separated, 
the New York Police Department, the Transit Police, and the 
Housing Police.
    We have an advantage that is not focused on very often, one 
that I got to know when I was the third ranking official in the 
Justice Department. New York City has one major police 
department, one large police department.
    The other cities that you looked at by and large are 
dealing with counties in which there are 10, 15, 20, 25, 30, 
35, and 40 different police departments.
    We have one police department of 38,310 police officers 
that covers five counties of the State of New York. That gives 
us a tremendous advantage. The New York City Police Department, 
I believe, is actually larger than the FBI in size, and can 
accomplish many of the forensic things that the FBI can also 
accomplish because of the scope of it.
    It also means that we can bring to bear large numbers of 
police officers in an efficient way without having to worry 
about jurisdictional disputes.
    All of these things are important to the results that I 
have shown you and more. But the one that I would like to spend 
some time on this morning, because it just won a prize from the 
Kennedy School as one of the most innovative programs in 
Government, is the Compstat program.
    Compstat uses intensive crime analysis sessions, up-to-the-
minute crime statistics, and computer pin mapping technology as 
basic crime fighting tools. Compstat transformed the New York 
City police from an organization that reacted to crime after it 
occurred, to an organization that can now with a fair degree of 
accuracy, predict where crime is going to happen and react to 
it in advance in order to prevent it.
    Before Compstat, the New York City Police Department's 76 
precinct commanders often were isolated from the top executives 
in the police department. They rarely met. Under the Compstat 
system, precinct commanders now meet with the police 
commissioner, the chief of the department, the chief of 
detectives, and all of the top leaders at semi-weekly meetings, 
where together they identify local crime patterns, select 
tactics, and allocate resources. And they come up with 
strategies for reducing crime.
    Critical to this is keeping very, very accurate statistics 
about crime. Last night at midnight, every 1 of the 76 
precincts in New York City had to report to headquarters the 
number of crimes that took place in all of the categories that 
are evaluated by the FBI, plus additional ones we have added.
    And by some time this morning, the police commissioner can 
see, if he wants to, his crime going up or down in any 1 of 
those 76 precincts. And if it is going up, where is it going 
up? Is grand larceny auto going up? Is rape going up or down in 
a particular precinct?
    And then every 2 weeks, the precinct commanders get 
together and look at those patterns. And when they see crime 
increasing, they are expected to not only see it, but to come 
up with a strategy to reduce it before it does become a 
pattern.
    Computer technology makes this possible; 10 or 15 years 
ago, you could not do this even if you had thought about it, 
because the technology was not there to do those kinds of 
evaluation. And I believe that this kind of analysis of 
communication has been critical in our battle against crime.
    Last year and this year, I selected and funded two major 
initiatives in two parts of the city. And the reason we did it 
was because the information that we have gathered, the computer 
technology and the mapping technique, demonstrated to us that 
certain areas of the city not only had more crime, but they 
were exporting more crime to the rest of the city.
    We focused on the northern part of Brooklyn. This was 
because we found that a number of the crimes committed in 
Manhattan, and in other parts of Brooklyn, and in Queens, and 
Staten Island, and even in the Bronx, were committed by people 
who came from, or brought drugs from organizations located in 
the northern part of Brooklyn.
    So by putting a thousand police officers there, and 
reducing the drug organizations in the northern part of 
Brooklyn, it actually had an impact on the amount of crime that 
occurred in other parts of the city. And then we made similar 
choices for this year in a number of precincts in the city. 
Those are the things that Compstat makes possible that was not 
the case before.
    But there is something that is even more important in what 
you are evaluating about this. For years, the New York City 
Police Department, and I believe most police departments in 
this country to this day, were measured by the number of 
arrests that were made.
    It was thought that the best way to determine police 
productivity was to figure out how many arrests were made. If a 
precinct commander had a precinct where lots of arrests were 
made, that must be a hard working precinct. If a police officer 
made a lot of arrests, that must have been a hardworking police 
officer who was doing a good job.
    And actually, all of that is true, but it misses the point 
of what a police department is for. A police department does 
not exist for the purpose of making arrests. That is part of 
what a police department has to do.
    There was a higher mission, and one that had to be 
identified as a result of what police work should be. The real 
purpose of the police department is to eliminate crime, or more 
realistically to prevent crime.
    So when you are using crime statistics as your management 
tool, you are now having the police department evaluated by 
precisely the result that the public wants from a police 
department. What the public wants from a police department are 
not more arrests, but less crime. They want a safer 
neighborhood.
    If arrests accomplish that, fine. If there are other ways 
to accomplish it, then that is equally as good and maybe 
better.
    The way in which I describe this to people, the way that 
this concept works, and the way in which we really devise it, 
is if you were running a bank and it has 76 branches, like the 
New York City Police Department has 76 precincts, the person 
running that bank would every day get an assessment of how much 
money was made or lost in the 76 branches.
    And quickly, when a branch lost money for 4 or 5 days, or a 
week, or two or three, when that had not been the case before, 
they would have to focus on why, what is going on, is it 
something we are doing, is it something going on in their 
economy, how do we fix it, how do we cure it? Should we close 
that branch, should we consolidate two other branches?
    Profit and loss is a very, very effective measure of 
success for most profitmaking private institutions. In 
Government, it is a little harder to find out what is the 
measure of success. But we use crime statistics the way that a 
bank would use profit and loss statements, and deposit records, 
to determine which precincts are accomplishing what. This in 
fact is the ultimate objective of the police department--
preventing crime--which ones are doing it the most effectively, 
which ones are not and why, and what is the strategy for making 
certain that they do.
    In one precinct, the strategy might be to use more police 
officers to reduce car theft. In another precinct, the strategy 
might be to use those police officers more accustomed to 
violence to prevent gang violence by young people. In a third 
precinct, it might be dealing more effectively with drug 
dealers, because they are producing crime.
    Compstat allows you to make informed, intelligent, and 
strategic choices in how to use your resources. And this is a 
program that could be used and probably would be easier to do 
in just about any city in America.
    Because in New York City, we have a tremendous volume 
problem. In other cities, it is actually even easier to focus 
your attention.
    So of the many things that I could select as reasons for 
these major crime declines, and I guess of the many different 
things that have contributed to it, I would say that this is 
probably the most innovative, and the one that is the most 
exportable, one that could be used and varied for different 
conditions in different places any place else in America, and I 
think with the same effect.
    I think the other thing that Congresswoman Molinari 
mentioned, because this is a very similar thing. Just because 
we had not reached a true measure of what success meant in the 
police department, the same thing was true with our welfare 
programs.
    When I was a private citizen and looking at the various 
management reports of the city of New York, every year I would 
see this chart that showed the welfare rolls in New York City 
increasing from 800,000 to 900,000, to 950,000, to 1 million, 
to 1.1 million.
    And then I would see charts that predicted that it would 
grow to 1.4 million and 1.5 million by the year 1994, 1995, 
1996.
    Now remember, we are a city with an official population of 
7.3 million people. Probably we have 8 million people in New 
York City. But 7.3 million is the official population. If you 
start looking at numbers like 1 million, 1.1 million, 1.2 
million, 1.3 million, 1.4 million, and 1.5 million on welfare 
in a population of 7.3 million, you have fewer people working, 
fewer people with jobs, more people being supported by the 
people who are working, and your tax base rupturing as a result 
of that, because people make choices to go live somewhere else.
    And the thing that disturbed me the most, and part of this 
whole emphasis on results and new ideas, is that those charts 
were produced by the city of New York, but there was never an 
idea presented about what to do about it. Not even a single 
idea.
    The best idea available was sit, watch it, observe it, 
catalog it, and come to Washington and ask for money to 
continue it, which seemed to me a horrible future for the city. 
Even more horrible when those numbers got filled in with human 
beings, an additional 100,000, 200,000, 300,000 people, who are 
not going to have any work, are not going to have anything to 
do all day, and are going to be supported by other citizens, 
many of whom will leave the city, because of this unfortunate 
progression that was taking place.
    We decided 3 years ago that we had to do something about it 
before the Federal welfare reform bill. And there are some 
measures that are similar, and some that are frankly very 
different.
    What we decided to do was an evaluation of the people who 
were on welfare, determine whether they were actually eligible 
for welfare. If they were eligible for welfare, give them their 
benefits, not reduce the benefits. If they were not, make 
certain that they did not obtain welfare. And also, use 
technology in order to accomplish that in much the same way as 
we did with the Compstat program.
    We developed a computer program and finger imaging. So that 
when people sought welfare, they were interviewed, and the 
information was put into a computer. We developed a data base 
that had all of the people who were on welfare. And now that 
data base allows us to also have in that computer people from 
surrounding counties, so that we can eliminate people who are 
collecting welfare two, three, and four times in different 
jurisdictions.
    We could therefore eliminate people who were collecting 
welfare who worked for the city of New York, had jobs, and on 
their lunch hour or part-time would come in and collect 
welfare. And we found more than a few people who worked for the 
city of New York, who were collecting welfare, and the city of 
New York never bothered to check. Because they did not bother 
to check anybody coming in asking for welfare on the theory 
that that would be humiliating.
    And when I first instituted the notion of finger imaging, I 
was accused of being harsh, and mean, and punitive. And my view 
of it was that everyone who worked for my administration was 
fingerprinted. And if you get fingerprinted for work, you 
should get fingerprinted and finger imaged as a means of 
identification for welfare.
    What we found was that some of the people on welfare worked 
for the city, worked for the police department, the fire 
department, and worked for the mayor's office, except no one 
bothered to check.
    We also found that there were a lot of people who deserved 
and needed to be helped, who needed a tremendous amount of 
help, which the city generously and in the right spirit wanted 
to give to people. We want to make sure that it really goes to 
people who really need help.
    The second part of the program was a workfare program. 
After the determination is made that someone is eligible for 
welfare and properly entitled to it, if the person is able 
bodied and does not have children under the age of 3, then we 
do the best that we can to find work for that person. And if we 
cannot find permanent work, we have them do temporary work that 
would assist the city in improving the quality of life.
    And right now, there are 37,000 people who are enrolled in 
our workfare program. And they clean the parks. They clean 
public spaces. They work in the Mayor's Office, and in the 
Board of Education. And they work part-time, 20 hours a week if 
they are students, 26 hours a week if they are not. And it 
keeps those people in the workforce. It keeps them with a 
purpose in life.
    I think maybe the best way that I could illustrate the 
difference in result is this chart right here. The chart on 
what would be your left shows the welfare rolls in March 1995 
at the very beginning, at the far left, when we started the 
program, and in January 1997, and you will see what they are 
now.
    Those are about 230,000 fewer people on welfare in a 2-year 
period, which is the biggest change that New York City has ever 
had in its welfare rolls. And it is a greater change than 
anyplace in America. This is a massive reduction of the number 
of people on welfare.
    And during this period of time, our unemployment rate 
actually is more favorable. We have not had an increase in 
unemployment. Actually, now up to 130,000 private sector jobs 
have been created. January of this year was the best month for 
increased jobs in New York City in 13 years. We have not had as 
many new jobs in New York City in any 1 month as we did in 
January 1997. The last time we did that was back in 1983. So it 
is not having a negative impact on our economy.
    And I have to say, Mr. Chairman, that if I had come here 
2\1/2\ years ago and told you that we were going to move 
230,000 or 240,000 people off welfare, and I went back home to 
New York City, several of the media operations in New York City 
would have predicted chaos in the city of New York with 240,000 
fewer people on welfare, and crime rates will go up. That is a 
terrible demeaning view, by the way, of people on welfare.
    Crime rates will go up. Unemployment is soaring. Jobs 
fleeing. Just the opposite has happened. We have taken 240,000 
people off welfare. New York City is safer than at any time 
since 1967 and getting safer.
    And our economy is recovering, not as fast as I would like, 
but we are recovering a lot better than it was 2 or 3 years ago 
when we had 240,000 more people on welfare. We are in a lot 
better shape today in our economy than we were then.
    And maybe the contrast shows this. Because I believe 
ultimately that results are enormously important as well as 
measuring them. But ultimately, philosophy and ideas are the 
most important. And there is a change in philosophy that is 
going on in the city of New York.
    When I suggested that people who come to emergency shelters 
be assigned to work, if they could--and when I say assigned to 
work, if they are able-bodied, and they are able to work--if 
they are not, then the city does have an obligation to care for 
them, and maybe even care for them permanently.
    But if people can work, they should be assigned to work. 
Several of the social activists said that I was being punitive. 
And when I heard the word, I kind of reflected on when did work 
become punitive. Going to prison is punitive. Being fined is 
punitive under our laws, our tradition. Working is ennobling. 
Going to work is something that dignifies you. It ennobles you. 
It gives you a sense of self-respect and self-worth.
    I think that in our prevailing social philosophy in New 
York City, we lost that notion of work. We lost it somewhere in 
the 1960's, the 1970's, and the 1980's, and the early 1990's. 
And there was an article just this week in the New York Times, 
I think that it was on Monday morning, talking about what they 
regarded as the successes and the failures in our workfare 
program.
    As a success, the article cited Maggie Montalvo, who was a 
mother who was fearful of losing her benefits after 15 years on 
welfare. She now meets her 20 hours a week workfare requirement 
by assisting teachers at her daughter's Headstart program while 
she is studying for her high school diploma.
    And in the article, she points out that this is the best 
thing that ever happened to her. It broke the cycle of 15 years 
of welfare. She was cited as a success by the Times reporter.
    And let me cite a failure, which is maybe even more 
interesting to think about philosophically. The failure is a 
gentleman by the name of Mr. Contreras, which said that he 
refused his work assignment, because he was frightened and 
humiliated by having to sweep streets for his welfare benefits.
    Now I consider that case a success. Because hopefully, we 
are going to change Mr. Contreras' attitude and ideology. I 
have a great sanitation commissioner in New York City. He is 
probably the best New York City has ever had. He got us through 
the two worst winters that we have ever had in the history of 
the city. And he got national attention for that last year when 
New York City was able to dig out of the snow faster than any 
other American city.
    He comes from Staten Island. He has been a sanitation 
worker for 37 years. And he began his career sweeping streets, 
and is proud of it. And I remember the quote of Martin Luther 
King, which I went and got right after I read this article, and 
Mr. Contreras' idea that it is humiliating to sweep streets.
    Dr. Martin Luther King said, ``If a man is called to become 
a street sweeper, he should sweep streets even as Michelangelo 
painted, or Beethoven composed music, or Shakespeare wrote 
poetry. He should sweep streets so well that all of the hosts 
of heaven and earth will pause to say here lived a great street 
sweeper who did his job well.''
    That is the concept of work that we have to re-establish in 
New York City and in America. It is actually the concept of 
work that my father taught me when I was a very young boy. 
Because as eloquently as Martin Luther King, he would say to 
me, ``There is no work that a man or woman can do that is 
honest to support his family that is not ennobling and does not 
give you a sense that you are taking care of yourself.'' That 
is what we are trying to do in our workfare program.
    New York City has become a national leader in the area of 
welfare reform. And our successes are being used as a model in 
other cities, and in cities as far away as Toronto, and in 
England.
    And this is really wonderful for the city of New York. 
There were two things I said when I began that I said I was 
concerned about, that the image of New York City was becoming 
the image of a city of too much crime. We now lead America in 
crime reduction. And we were seen as a city that was the 
welfare capital of America. And whether we lead America or not, 
I do not know. But we certainly have done more than the city 
has ever done before in moving people off welfare, getting them 
into a workfare program that ennobles work, and makes work a 
core function.
    And I think that what we are doing very simply is we are 
substituting for many, many failed social programs the only 
social program that really ever works, which is to give 
somebody a job. Thank you.
    [The prepared statement of Mr. Giuliani follows:]
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    Mr. Horn. We thank you, Mr. Mayor. We are going to proceed 
with questions now. That was a marvelously eloquent statement 
and showing of commitment, and showing what leadership that is 
not afraid of making the tough decisions can do in turning a 
city around. And not some of the mayors that we see that sort 
of hide in their office and go cut ribbons, and do not know 
what it is to make a tough decision.
    Let me ask you a few questions on your testimony. And then 
we are going to have 5 minutes for each of us. And we will keep 
rotating until we get all of the questions out of our system, 
and as long as you are patient.
    I am curious as to what the most difficult factor you found 
in trying to turn this operation around, what was your biggest 
obstacle?
    Mr. Giuliani. Resistance to new ideas. And whenever a new 
idea was proposed, it was contrary to the notions of political 
correctness. It was almost an effort to kill the idea before 
people could try and look at it and do it.
    I mentioned that the very first time that we proposed 
fingerprinting or finger imaging welfare recipients, there was 
a massive reaction. This was insulting. Which actually exposed 
what was wrong with the philosophy that was being implemented 
in the first place.
    There is nothing insulting about being fingerprinted. 
People are fingerprinted for jobs all of the time. But it took 
a whole lot to deal with a new idea.
    And New York City in a strange way, although it is 
America's largest city, in some way, its intellectual core can 
become the most rigid. And it is very, very difficult to 
propose a new idea.
    I think that we have changed that. Because so many of the 
new ideas, some of which I am illustrating here, have now been 
able to create results in New York City that the city, at least 
in a few areas, appear to be very successful.
    Mr. Horn. Having been a university president, I can testify 
under oath, or without oath, that people who like dealing with 
ideas do not dislike new ideas. They like their fixed ideas 
that they have been comfortable with. It is very hard to 
change.
    I would think that besides that factor, sort of dealing 
with the corporate culture of the organization, you know, the 
old saw they have said for years. That they trained the right 
young people in the academy to go out on the beat. And the 
sergeant said, ``Kid, forget the stuff that you were taught in 
the academy. Just watch what I do.''
    And to break through that, a person with your criminal 
justice background would be one of the few people who would 
understand all of those interrelationships. But I think that 
was one of the major problems.
    I am curious on the fingerprinting that you mentioned with 
welfare workers.
    Are all of the welfare recipients having an identification 
card and fingerprints?
    Mr. Giuliani. All of their identifying data is put into a 
computer. And as part of the actual interview, they are really 
finger imaged rather than fingerprinted, right on the computer. 
It is four digits. So if in fact they are already collecting 
welfare benefits, that would within a minute be searched by the 
computer.
    Whenever you deal with New York City, which I learned when 
I became mayor, you are dealing with a volume that is almost 
unimaginable. This is enormously important. Because it might 
take you, if you just search manually, it might take you weeks 
to find out, if you could at all, if the person was on welfare 
benefits in another county of the city. Or even as happened 
more often, another county of the State.
    We had a lot of cross-over welfare recipients with other 
counties of the State of New York, Westchester County, and 
Nassau County, and Suffolk County. We are now able to search a 
computer base, so the people no longer try and do that.
    Mr. Horn. How many thousand left the rolls as a result of 
that simple thing of a fingerprint identification or a visual 
image?
    Mr. Giuliani. I would have to go back and tell.
    Mr. Horn. Los Angeles County did a similar thing. Thousands 
were taken off the rolls without question. That is a county of 
a million people.
    Mr. Giuliani. It is certainly thousands. I could probably 
find out for you and will get the precise number.
    Mr. Horn. If you have it. We will put it in the record at 
this point.
    [The information referred to follows:]

    As of April 2, 1996, 37,584 cross-over welfare recipients 
have been taken-off the City's rolls as a result of our 
fingerprinting program.

    Mr. Horn. I think that with the responsibility, to use the 
Governor's term, of devolvement of power and authority to 
precinct commanders, and giving them a more active role, that a 
lot of cities would be out recruiting your precinct commanders, 
because they now understand a new system.
    Has that happened very much, and does Compstat go with 
them, and are other cities asking for that data base, that type 
of software?
    Mr. Giuliani. Two things. First of all, it has always been 
true that commanding officers in the New York City Police 
Department are often recruited to be police commissioners and 
police superintendents in other parts of the country. That has 
happened very, very often, and it continues to happen.
    There is a tremendous amount of interest in the Compstat 
program. And we have had delegations from at least 20 different 
cities come to visit the program.
    Mr. Chairman, or Congresswoman Maloney, Susan, any of you 
who want to come and see it, we would be happy to show you. It 
is done twice a week. It is done in a room about half the size 
of this one with a big map on the wall.
    It is interesting and exciting, and you can actually see 
how it operates. The police commissioner would be happy to show 
it to you. He has had groups from Washington, DC, and 
Baltimore.
    Mr. Horn. My colleague here has been wanting us to have 
hearings in New York City. So we will figure out a way to do a 
number of things when our ranking colleague is hosting us up 
there.
    Let me ask you on the jail capacity in New York City, are 
the New York City jails under any Federal court order as to a 
constitutional jail?
    Mr. Giuliani. The New York City jails are under a Federal 
court consent decree that we had amended and lifted about 8 
months ago, because I believe that we had demonstrated to the 
judge that we had accomplished everything that was sought to be 
accomplished 15 or 20 years ago. And now the mandates had 
really turned into very, very unrealistic micromanagement of 
the jail.
    So we have been relieved of many of those mandates. Our 
jail population is pretty close to the highest that it has 
been.
    Mr. Horn. What is it roughly?
    Mr. Giuliani. We have about 20,000 people in jail in New 
York City. And we have about 60,000 people for the entire State 
that are in State prisons, of which New York City is probably 
about 60 to 65 percent of that prison population.
    So there is no question. I said that there were a number of 
things that have led to the decline in crime. The number of 
people in jail in New York City or in prison in New York State 
contributes to the crime decline in New York City.
    Mr. Horn. I assume that your jail system has a 
classification system in order to conform with that consent 
decree.
    When a judge sentences an individual to a year in the 
county jail, let us say it is a felony--and as you and I know, 
30 years ago, you usually had the town drunk and misdemeanants 
in the county jail, and the rest were in State prisons. Now you 
have a much more hardened population.
    So what happens? Does the director of corrections take them 
in and keep them for a year, or do they let them out the next 
day? In Los Angeles, we have let them out the next day.
    Mr. Giuliani. We have an interrelationship with the State. 
Once a person is sentenced, the person becomes the 
responsibility of the State. But if it is a short sentence, or 
if it is a misdemeanor, they might actually serve their time in 
a city jail.
    One of the things that needs to be changed in New York, 
which makes the performance results for the police department, 
and the corrections department, and everyone else even more 
remarkable is we probably in the State of New York--I should 
not say probably, because I have looked at this over and over 
again--we by and large put people back out in the street 
through a very bad series of laws and court decisions faster 
than anyone else in the country.
    You would be likely to spend less time in prison in New 
York for a crime that you committed than in California, 
Pennsylvania, or Florida. Because New York has never gone 
through in New York the reform of the criminal justice system 
that most States went through in the 1980's.
    It has been tried, resisted, and stopped. So if you are 
convicted of rape let us say in New York, and you are sentenced 
to 10 years in prison, you are probably going to be out in 3 to 
4 years. Whereas if that same conviction took place in Florida, 
you are probably going to be in for 8 or 9 years.
    So we tend to put more of these violent criminals back out 
on the streets for longer periods of time in which they can 
commit crimes of violence, than in most other places in the 
country. We still essentially there have the philosophy of the 
1960's and 1970's, without the readjustments that took place in 
most places in the 1980's.
    If my police commissioner were here, he would tell you that 
the single most important thing that we have to do to continue 
these crime reductions is end parole in the State of New York.
    Mr. Horn. Since I went over, I will yield 7 minutes to my 
colleague, the distinguished ranking member from the city of 
New York, Mrs. Maloney.
    Mrs. Maloney. Thank you, Mr. Chairman.
    Mr. Mayor, what advice would you give the Mayor of 
Washington, DC, to work to control the crime here in this city?
    Mr. Giuliani. Well, there are different problems in 
different cities. I would say that the things that we are doing 
that are exportable to any city, including Washington, DC, and 
that would have fairly immediate results, is to incorporate the 
broken windows theory. To make certain that you organize 
something like the Compstat program, so that you evaluate crime 
statistics in every precinct, every day.
    That you give your local commanders essentially full 
responsibility for reducing crime in their precincts, and work 
with them to come up with ways to get the resources to do that. 
That a lot of crime reduction can come about through management 
of the police department.
    And that at least those two general things that we are 
doing, the Compstat program and the broken windows theory, can 
work in Washington, DC, or anyplace else in which they are 
used.
    Mrs. Maloney. In the Compstat program and in developing the 
state-of-the-art computer system, how much did that cost, and 
did Federal dollars or the Federal Government play any role or 
are they playing any role in this program?
    Mr. Giuliani. Well, right now, we benefit greatly from the 
crime bill. Much of this started before the crime bill, so it 
really did not fund the initiation of these programs.
    New York City was ahead of the curve in terms of hiring 
more police officers. The crime bill impetus to hire more 
police officers came after New York City actually hired 5,000 
or 6,000 more police officers.
    But here is the way that the Federal Government has helped 
us. When the crime bill was first suggested, the theory of the 
crime bill was to hire more police officers. I realized that in 
New York City we had already done that, and we were not going 
to get any real benefit from the crime bill.
    So I asked that the crime bill be changed to include 
something that would be a little harder to understand, but we 
got the flexibility to hire more civilians. Because we could 
produce more police officers for the street by hiring 1,000 or 
1,500 more civilians, and putting those police officers out on 
the street.
    The President and both Houses of Congress considered that 
and made that change, largely at the request of New York City 
and Philadelphia. Because we really did not need any more 
police officers, but we needed more civilians.
    We also asked for broader scope for technology. Now if I 
could give you a dollar amount, we are probably getting about 
$120 or $130 million of assistance out of the various programs 
in the crime bill, all of which assist us in having modern 
technology, improving that technology, having civilians do work 
that previously police officers were doing, so they could not 
be out patrolling the streets or making arrests.
    And it did not initiate these crime reductions. But I do 
not think that they would have continued at this level, if we 
had not had that support.
    Mrs. Maloney. I can remember my first official meeting with 
Mayor Koch. At that time, I was a staffer for the New York 
State Assembly Cities Committee. And we met with him on what 
were the legislative priorities and the priorities of New York 
City.
    I remember that he put as one of the top priorities merging 
the police departments. And it has been a priority of many 
mayors even before Mayor Koch and Mayor Dinkins. It has always 
been something that was out there that seemed logical and 
common sense for our city, but no one was able to achieve it.
    You talked about some of the successes of putting more 
police officers to work the streets, or to help in crime 
prevention.
    Could you talk about some of the obstacles in getting the 
merger, and why do you believe that you were able to succeed 
when former mayors were not, who had tried very, very hard to 
achieve it? But I would like to know what some of the problems 
and obstacles that occurred, and how you overcame them? I think 
that it might be helpful to other Members who confront the same 
local problem in their cities across the Nation.
    Mr. Giuliani. The major obstacle frankly was unions. You 
had three separate unions, and three separate union 
leaderships. And if you merged them together, there would only 
be one. You had three separate union presidents for the police, 
transit, and housing. And two of them knew that they would no 
longer be union presidents if the merger took place. You had 
three separate treasurers and secretaries.
    And in police work, if you are a police officer and an 
officer of the union, you get to sit around the union 
headquarters all day. And union officials and union officers 
have a tremendous amount of political influence, as you know.
    So frankly, the major obstacle going back to Mayor Lindsay 
and getting this one would be the vast and fierce opposition of 
two of the three PBAs. We had one for the police department 
with 2,728 officers running it. We had one for the transit 
police with 2,728 officers running it. And we had one for the 
housing police.
    Well, that group of transit and housing officers knew that 
if a merger took place, maybe a few of them would survive, but 
most of them would no longer be kings, and queens, and high 
potentates. And that was the major opposition to it.
    Most of the police officers, the ones out there risking 
their lives in the housing and transit police wanted to be New 
York City police officers. Because the career path was better. 
Instead of always being in one area of assignment, you had the 
possibility of a multitude of 20 or 30 different kinds of 
assignments, and a much greater career path. It was more 
interesting work, because it was varied.
    Mrs. Maloney. Did you need State approval?
    Mr. Giuliani. We actually figured out that for housing it 
could be done with the approval of HUD. And frankly, Secretary 
Cisneros and then Assistant Secretary Cuomo were enormously 
helpful to us in getting that done. We got that done 
administratively through the New York City Housing Authority 
and HUD by getting the approval of HUD to disband the housing 
police, and incorporate it into the New York City Police 
Department. We were sued by the union, and we went to court. 
They blocked it for a year. And we finally won the lawsuit.
    With regard to the transit police, I needed an affirmative 
vote of the MTA. And Mayor Koch had gotten very close to doing 
this and lost by one vote. Actually, a vote that was promised 
to him. And then the person, I would say because of pressure 
from the union, changed his mind. We were fortunate. We were 
able to get it through.
    Mrs. Maloney. So there was no action by the New York State 
Legislature in this merger?
    Mr. Giuliani. I think that it would have been frankly 
impossible to do, if that were the case. The pressure from the 
two unions, knowing the kind of influence that they exercise 
over the New York State Legislature, would have been so great, 
that despite the fact that most police officers wanted it, it 
would not have happened.
    Mrs. Maloney. My time is up.
    Mr. Horn. I thank the gentlewoman.
    And I now yield 7 minutes to the gentleman from Illinois, 
Mr. Davis.
    Mr. Davis of Illinois. Thank you very much, Mr. Chairman.
    Mr. Mayor, I, too, would like to express my words of 
welcome to you to these proceedings. And I would also like to 
indicate that I thoroughly enjoyed your testimony in both its 
substance as well as the eloquence in which you presented it.
    I am particularly interested in the ability to reduce crime 
to the level at which you have been able to do. Especially 
given the fact that so many of us throughout the country sort 
of look to see what is happening in New York in terms of the 
reputation for innovativeness, for creativity, and for 
wrestling with the problems of the largest city of our country.
    The question that I have is were they, or how involved were 
community groups and organizations in helping to develop this 
new strategy of increasing patrol time, and dealing with what 
some might call mini-problems?
    Mr. Giuliani. Vitally important. As I think the chairman 
pointed out when he used the term of devolvement of 
responsibility, what happens through the Compstat program, 
which is what the technology of it is, is a precinct commander 
is made the police commissioner for his or her area of the 
city.
    And the precinct commander has to show results, reduction 
in crime. That is what it requires precinct commanders to do, 
because they know every week and every month, the police 
commissioner is looking at what has happened with all of these 
crimes. The precinct commander all of a sudden becomes a 
community involved person. Because the precinct commander 
realizes that one of the ways that you can reduce crime is with 
close associations and ties to the community groups. They can 
help you deal with youth violence. They can help you deal with 
the people who are really going to line up and help the police, 
and the people who are going to be problems. Each one of the 
precincts in the city has precinct councils. They bring in 
people from the community. It is organized, and it is 
structured. But it means that at least once a month and very 
often once a week, the commanding officers of the precinct are 
confronted with people from the community to deal with areas of 
mutual interest, antagonism, and problems.
    If the police are having a problem in reducing a particular 
area of crime, they can ask the community to help. If the 
community feels that it is under-policed in a certain area, 
they can raise those complaints.
    It would be incorrect if I gave you the impression that all 
of these precinct councils worked perfectly. But some of them 
work really well. And all of them at least create lines of 
communication.
    So I would say that community support is absolutely vital 
to getting this done. But by focusing on crime statistics and 
saying to a precinct commander the result that we want from you 
is not that you arrest people, we know that you have to do 
that, but the result that we want from you is we want to see 
murder rates go down, and we want to see rape rates go down.
    And the precinct commander understands immediately that one 
of the ways to do that is to get the cooperation of the 
community. So it is in their self-interest to make sure that 
the police officers get involved. And that is something that we 
are still working on. That is still not working to the level of 
satisfaction that I would like.
    The police commissioner this year has put a tremendous 
emphasis on something he calls CPR--courtesy, professionalism, 
and respect. To try to increase in police officers the 
understanding that by acting respectfully, they are actually 
going to bring crime down more.
    It is something like the broken windows theory. When you 
arrest somebody, treat them in a respectful way. Even if you 
are angry, treat them in a respectful way. It will create a 
much different atmosphere in the community.
    Mr. Davis of Illinois. So it is really a form of further 
decentralization with more authority as well as responsibility 
being given to the local command?
    Mr. Giuliani. Correct. It gives them a tremendous amount of 
authority, but makes them highly responsible with a daily 
measure in a sense of whether they are doing a good job or a 
bad job.
    Mr. Davis of Illinois. My mother used to tell us when we 
were kids and had money, that if we took care of our nickels 
and dimes, that the quarters and the 50 cents and dollars would 
take care of themselves, so we would have a better 
understanding of how to do that.
    The idea of dealing with the broken window problem is the 
idea that if you focus on what people call small crimes, that 
in all likelihood that it will reduce the temptation for 
individuals to get involved in larger crimes.
    Mr. Giuliani. That is certainly a very big part of it, Mr. 
Davis, yes. If in a city you say we take fare jumping 
seriously, you are going to teach a lot of young people even at 
a young age that they should not be fare jumpers, and they are 
not even going to move on to the other things that they might 
consider doing. That is certainly part of it.
    Mr. Davis of Illinois. I must ask you a question, if I 
might, about the work experience program.
    As you have reduced the number of people on welfare, are 
you suggesting and recommending that one way to deal 
effectively with the transition from welfare to work is for 
Government at all levels to take more responsibility for the 
actual employment or the development of work opportunities for 
the individuals who have been in welfare?
    Mr. Giuliani. In cities like New York, it is critical that 
Government do that. Otherwise, you would have massive numbers 
of people without anything to do all day. The ideal is for 
somebody to have a permanent job. And from my point of view, 
the ideal is for somebody to have a permanent job by and large 
in the private sector. That is where they are going to have the 
real career opportunities.
    The ideal is not workfare. But workfare is better than 
somebody doing nothing all day. And really, what we have in New 
York City now is not terribly different than the public works 
programs that existed in the early part of the New Deal.
    What we are saying is that we want to enhance permanent 
employment. We never wanted to detract from permanent 
employment. But if you cannot get permanent employment and we 
are not ready to help create that--that is not happening for 
everybody. It is happening for more people, but not for 
everything--it is better for somebody to be doing something 
meaningful for part of the day than being entirely out of the 
workforce.
    And the fact is that the work experience program 
participants are doing something enormously valuable for the 
city. Cleaning a city park is a big contribution to yourself 
and your fellow citizens. Cleaning graffiti off of city 
buildings is a very big contribution to your quality of life 
and the quality of life of your fellow citizens. And it keeps 
you in the workforce, and it keeps establishing the social 
contract with people on a one-to-one basis.
    I should tell you that we try to be as careful about this 
as we can. Because I also believe that it should not in any way 
reduce permanent employment. Recently, I rejected something 
that our subway system did. They made an agreement with their 
union to remove I think a couple of thousand permanent jobs in 
order to save money, and replace the permanent workers with 
welfare workers. And they wanted me, the city, to supply them 
with the welfare workers, which I refused to do.
    Because I want this program to increase permanent 
employment, not decrease it. The goal here is not for people to 
be on workfare for their entire life. The goal here is for 
people to be on workfare if they cannot get a permanent job. It 
is better than being at home. It is better than being out of 
the workforce. And we wanted to enhance permanent employment.
    And so far, that is working. We have reduced city jobs by 
22,000. We have decreased permanent employment by about 
120,000. And that is exactly the direction that we want to go 
in. We want more people working in the private sector. And for 
the period of time that they cannot get work in the private 
sector, then we have valuable things that they can do to help 
the city.
    Now New York City might be more fortunate here, because we 
are a very big city, and we have a lot of needs, and we have a 
lot of things that can be done. But I think Government has a 
role, if it understands it correctly, in helping this 
transition happen.
    And some of my questions and problems with the Federal 
welfare reform bill, which frankly, I think, has lots of 
problems in it, the philosophy of it, I not only agree with, I 
incorporate in the workfare program.
    The mandates, how intensive they are and how much of a cost 
shift is made to local government, I think are very damaging.
    Mr. Davis of Illinois. Is it cost-effective? The last 
question.
    Mr. Horn. We have a vote. If Members would like to go over 
and vote and come back, we will continue the questions.
    Mr. Davis of Illinois. Thank you. I will go vote.
    Mr. Horn. What is the percent of sworn officers here on the 
police department who are asked to go interact with clients, to 
interact with students, with groups or whatever?
    Mr. Giuliani. I would say that it's about--there are always 
different ways of evaluating this. I would say what I would 
consider to be administrative work, where they are not involved 
in enforcement, direct enforcement activities, it is probably 
down to about, now, 10, 12 percent. It used to be as high as 
probably 20 percent.
    Mr. Horn. Because we just went through a Booze, Allen, and 
Hamilton study of the DC Police Department. And just to round 
it off, out of 1,000 sworn officers, there are really only 
about 200 on the streets. They need a dose of your medicine, in 
brief, in this city.
    What have you done in terms of reinvention of processes and 
all of the rest in other areas besides the police department; 
have you targeted other areas of your administration?
    Mr. Giuliani. In the law enforcement area?
    Mr. Horn. Right.
    Mr. Giuliani. In the criminal justice and law enforcement 
area?
    Mr. Horn. You obviously have done great here. And I am sure 
that every single agency that you have can use some rethinking 
of how they do their business.
    And I was just curious as to what your general priorities 
were?
    Mr. Giuliani. Sure. We have tried to do the same thing in 
every agency of Government. In other words, spend time with 
them figuring out what results there are that the public wants 
achieved in that agency. And then set those up as measures. Put 
them out there very publicly, and not be afraid to be 
accountable.
    For example, what I am trying to do right now with the 
Board of Education, where we educate 1 million students, I have 
taken $120 million and put it in a special fund, the purpose of 
which is to give students 6 more hours of reading instruction 
per week for schools who want to participate. To really get 
students private tutoring, so that their reading scores can be 
improved.
    But the program that I am working on with the chancellor of 
the New York City School System is to only get this money if 
you agree to be evaluated. The children tested on reading 
scores to start with. The children tested after 6 months. The 
children tested after a year.
    If you are improving reading scores, we will continue you 
in the program, and have you expand it to help even more 
children. If you are not, then the chancellor is going to have 
to consider if we have got to change the personnel doing the 
instructing, because they are not really doing a good job.
    We are trying to incorporate in the educational system, 
which is independent of the mayor--it is not as easy to do, 
because they are not directly responsible to me--the same kind 
of results-oriented management. So we start tying the spending 
of money to improved reading scores, and how do you do it? 
Improve math scores, and how do you do it? Improve graduation 
rates, and how do you accomplish that?
    So we are attempting to use the same process there. And 
believe me, it is needed even more in that area. Essentially, 
what you had in the New York City Public School System is the 
culture of unaccountability. And what we are trying to change 
it into is a culture of accountability.
    So if you want more money, you have got to put yourself on 
the line for it. We are going to be able to improve the basics 
of education. And we are going to be willing to be measured by 
that, and held accountable for it.
    Mr. Horn. Well, I will pursue that when I return, because 
that is an exciting area. My words, as I left the DC hearing, 
was that this Congress should not tolerate thousands of 
African-American children going through the school system in 
the District, and they cannot read. It is a national disgrace. 
And we need to do something about it.
    We ought to look to New York. But as you know, the 
educational hierarchies in many of these cities, they are sort 
of independent of the mayor in most cities in America. And that 
is increasingly part of the problem. When we thought that we 
were protecting them 30, 40, 50 years ago from political 
intrusion, now we are just protecting them for public opinion.
    Mr. Giuliani. I just had that conversation yesterday with 
the mayor of Los Angeles.
    Mr. Horn. We see eye-to-eye.
    Mr. Giuliani. He has the same view on that.
    Mr. Horn. We are in recess for 10 minutes, or until Mrs. 
Maloney returns and begins the hearing with her questioning.
    Mr. Giuliani. Thank you, Mr. Chairman.
    Mr. Horn. Thank you.
    [Recess.]
    Mr. Horn. Thank you for your patience, both audience and 
witness. This is a vote on the rule to consider a very 
controversial resolution with the recertification of Mexico, 
given the drug situation.
    I do not know if you have any views on that, Your Honor. 
But if you do, I think that a lot of Members would appreciate 
knowing it. Because you can vote either way in doing the right 
thing. This is one of those votes.
    Mr. Giuliani. I do not know the resolution. But the maximum 
amount of pressure on Mexico to do more about the drugs that 
are grown there, the crops that are grown there, is valuable 
and important.
    Mr. Horn. There is no question that there has been a 
difficult time where drugs are still being flown in from 
Colombia, dropped below the border, and dropped out at sea. 
Several of us went out and looked at that situation several 
months ago.
    There is also no question that a hundred people lost their 
lives fighting drugs in Mexico--judges, prosecutors, police 
chiefs, and so forth. So it is a very difficult question. And 
we will have 2 hours to argue over the rule. And maybe by that 
time, we will all have made up our minds.
    Getting back to your results-oriented government there, I 
am curious. You mentioned education as we broke up for the 
vote.
    Are there any other areas that you see as major 
opportunities for this type of turnaround?
    Mr. Giuliani. The Administration for Children's Services is 
another example of trying to accomplish the same thing, and one 
that is harder. Because there is less agreement on what the 
results are, and it is harder to categorize those results. But 
we are moving toward that.
    When I became mayor of New York City, we dealt with 
protecting children as part of the overall approach of the 
welfare. The Child Welfare Agency was part of what we call the 
Human Resources Administration. It was a $6 or $7 billion 
agency. Child Welfare was about a billion of that $6 or $7 
billion agency.
    And because of a terrible tragedy with a child dying in New 
York City, I really focused a tremendous amount of attention on 
what was going wrong there. And one of the things going wrong 
was that priorities of protecting children were being subsumed 
in to the priorities of dealing with welfare.
    And we needed to take that agency out from under HRA and 
make it a separate agency, and put the sole focus on what we 
can achieve in terms of results in protecting children. And I 
appointed a commissioner, because a lot of this is about 
leadership, a commissioner who had a very strong background in 
both child protection agencies and law enforcement, because 
both are involved here.
    And he spent months, and months, and months, and I devoted 
a lot of my time to this, trying to figure out what the results 
are that we can use to measure the success of this agency for 
all of the people who are in it similar to what we have done in 
the police department.
    We used one of the same consultants who did the police 
department study for us to do a study of the Administration for 
Children's Services.
    Mr. Horn. On the consultant, was that a major consultant 
firm?
    Mr. Giuliani. No. It was a single individual who helped us 
and worked with us. Really most of the work has to be done 
within.
    Mr. Horn. Could you share the person's name? We might want 
to put him to work on testimony, if you are advising other 
people to use him or her?
    Mr. Giuliani. Sure. Jonathan Lindner.
    Mr. Horn. Jonathan.
    Mr. Giuliani. Lindner.
    Mr. Horn. Lindner?
    Mr. Giuliani. Right.
    Mr. Horn. Very good.
    Mr. Giuliani. And we produced a report that lays out in 
great detail the results that we now expect of that agency. How 
to get there, and how they will be measured over a period of 
time.
    And ultimately, the most important result, like the ideal 
of preventing crime is, to prevent the death of children 
through abuse and neglect. To eliminate completely abuse and 
neglect of children.
    You know that you are probably never going to achieve that 
perfect objective, but you have to make it your objective. Just 
like the objective of the police department should be 
preventing all crime, knowing that it is never going to achieve 
that result. But maybe in trying to reach for that result, you 
have the kinds of reductions that you have been able to 
produce.
    Mr. Horn. Speaking of children, does the New York City 
government have any role in collecting payments from deadbeat 
dads which leave the city or your jurisdiction?
    Mr. Giuliani. The agency that I just mentioned----
    Mr. Horn. Has that responsibility?
    Mr. Giuliani [continuing]. Now has that responsibility. And 
again, by focusing on results, and focusing on statistics and 
technology, they have been able to measure their success. Their 
collections are now up 30 to 35 percent.
    Mr. Horn. I do not know if they are aware of the bill, the 
Horn-Maloney bill, that became law. Commissioner Adams, the 
Commissioner of Revenue for the State of Massachusetts, said 
that was the best thing he has seen in years. Because he can 
now run State tapes against Federal tapes, and find out where 
the deadbeat dads are, and get a collection out of them.
    And I remember that the President used a national radio 
address to mention that. He just did not mention the authors of 
the bill. That is OK. We are used to that. Just get it into 
law.
    But that might be helpful to your group in terms of 
catching them. Adams thought that it was millions for the 
Massachusetts treasury, and to get them to the people.
    Mr. Giuliani. One of the things that emerges from this 
study is that children whose fathers are properly contributing 
to their support tend to have much better reading scores, math 
scores, much less frequent involvement in violating the law, 
and their graduation rates are much higher.
    The connection of the father to the child, and making sure 
that the responsibility is carried out, not only has tremendous 
financial benefits for the mother, child, and society, but it 
is sometimes the thing that is needed to link the child to 
their father and to maybe a better future.
    I have been a long time advocate of what I call the right 
brain theory of education, the creative and artistic aspects of 
the child. And it goes back to my own grammar school experience 
in a rural part of California. A third of my classmates were 
Hispanic, and their parents really never had a chance to go to 
school. And I saw some tremendous artistic talent that I did 
not have.
    Those of us who were getting high grades in math or 
history, we still drew stick figures. And my colleagues, who 
did not know all of the math, and the history, and whatnot, 
they were drawing beautiful things that could be built on in a 
school system to raise their self-esteem, and then transfer 
that energy and that commitment to school to understand some of 
the more left brain aspects.
    And just 2 days ago, Ms. Slaughter, a Member from New York, 
and I hosted a gentleman by the name of Bill Strickland from 
Pittsburgh who is the recipeint of the top MacArthur Foundation 
grant, the genius grant, where they give you several hundred 
thousand dollars, and do with it what you want.
    He has built as an entrepreneur, and a person who was a 
dropout practically from the schools, but a ceramicist, he has 
trained and educated welfare mothers, unemployed steel workers, 
and one thing led to the other. So he is operating a huge 
enterprise now with the latest architecture. They have never 
had a racial incident. The students are white as well as black, 
and so forth. It is really quite a success story.
    And he has located this facility and built it over the last 
two decades or so in the very worst part of Pittsburgh where 
nobody in their right mind would go walking around. Yet they 
come to see the jazz concerts. He has got a music program. He 
started with a ceramics program, and taught them how to make 
ceramics, and how to get sales.
    One thing then led to let's get into a food operation. He 
now makes hundreds of thousands of profit a year, which he 
pours into the school. They had a horticulture operation. They 
had a training young pharmacist assistants operation, and so 
forth. It is a marvelous story of innovation and 
entrepreneurialism, where the private sector and Government 
came together and got some things done.
    So there is a lot of room for improvement, but we have got 
a lot of people like you have stuck their neck out, get the 
giraffe award so called, which is the proudest award that I 
have for sticking my neck out.
    Mr. Horn. But that is important, to get their neighborhood 
entrepreneurs. There is a lot of talent out there. And how do 
we funnel some of that talent, and put them to work?
    Mr. Giuliani. Well, I think that in the area of education, 
that probably one of the biggest mistakes that was made in New 
York City in the past, and I think that this probably goes back 
15 or 20 years, was to essentially defund arts education on the 
theory that arts education was discretionary.
    And given the budget problems or whatever, arts education 
could be sacrificed. Because teaching reading, writing, 
arithmetic, history, or whatever was more important.
    I am trying to reverse that. And I am trying to reverse 
that from the position that we talked about before you took the 
break, which is not being directly responsible for the school 
system, like Mayor Reardon is not, and Mayor Rendell is not. 
And all of them I think would say the same thing.
    Mr. Horn. Hardly any mayor has any actual relationship.
    Mr. Giuliani. Every one of those mayors, all of whom I 
think are very effective leaders of their city, will tell you 
precisely the same thing--that our greatest frustration is that 
we do not have the jurisdiction or capacity to turn around the 
school system the way we turned around the other areas of city 
government. Because we could accomplish that.
    And in the name of independence, what really has happened 
is unaccountability, total, absolute, complete 
unaccountability. And when you look at what has happened in 
Chicago, where the State legislature and the Governor had the 
courage to stick their neck out, and so did the mayor, and they 
turned the school system over to Mayor Daley, you are seeing 
the kinds of reforms there that could happen in the rest of the 
country.
    My only agenda for the New York City public school system 
is not a political one. I do not have anybody who wants to 
politicize the New York City public school system. I do not 
even know if they would know how to do that. My only agenda for 
it is to be able to come before Congress the way I just did 
before, and show you the same results in education that we 
showed you in crime.
    We will show you reading scores going up 20 and 30 percent. 
And math scores going up 20 to 30 percent. Graduation rates 
that were 20 to 30 percent becoming 50 and 60 percent. And I 
understand that we have to put arts education back into the 
schools.
    So here is the way that I have to do it, which is not the 
best way to do it, but it is the way that you have to do it 
given the strange arrangement that takes place.
    I have taken $25 million, and I have put it in the city 
budget. And I said to the Board of Education you can have that 
$25 million when you do two things. One, identify all of the 
arts programs that presently exist. And No. 2, figure out how 
you are going to match that money, so you can eventually get to 
$75 million.
    Because I have to do that in order to get them to get into 
their system, so that we can put drawing, music, and everything 
else back into the curriculum. We are going to accomplish it, 
but it cannot be done as quickly and as effectively as the 
kinds of things that I am talking about there.
    Mr. Horn. In 1975, I think it was, when I was the vice 
chairman of the U.S. Commission on Civil Rights, the Commission 
went to New York City to look at the education system. And what 
we found was that the State laws of the 1890's or so, was where 
they wanted a meritocracy. And we looked at the exams that they 
were giving for assistant principals. Three of us were college 
presidents out of the six members, Father Hesburgh, myself, and 
Chancellor Mitchell of the University of Denver. And we all 
admitted that we could not answer those questions.
    This is the one for the assistant principal, usually the 
person responsible for truancy, and the discipline in the 
school and all of that. And the exams precluded anyone with 
common sense from becoming the assistant principal in the New 
York City school system. And that was the State mandate of the 
Merit Commission, as I remember.
    And that was good for its time when you wanted to keep my 
Irish relatives with a third grade education out or teaching 
the sixth grade or something. But that was not good in the 
1970's and 1980's. And they needed a little more flexibility. 
And I do not know if the State government has given them any of 
that?
    Mr. Giuliani. Yes, that has been changed.
    Mr. Horn. Good. Because it was sure needed. And we pointed 
that out in a report, as I remember.
    I am now going to yield time to Mrs. Maloney, because I 
know that she has a number of questions.
    Mrs. Maloney. It is great to have the mayor of New York 
here, and we can ask him questions about the problems.
    My office is getting a lot of calls, and I am sure that 
Susan Molinari's office is, on the Federal change in the SSI 
program. And I am getting calls from some people who are 105 
years old or certainly relatives. Really elderly and frail 
people, 94. They cannot take the test for citizenship. And 
their SSI payments by law are going to be terminated.
    How are we as a city going to confront this problem?
    Mr. Giuliani. This is a very, very big problem.
    Mrs. Maloney. I would think that your office is probably 
deluged.
    First of all, who would I call in your office on these 
problems?
    Mr. Giuliani. Well, he is sitting right here. Tony Coles. 
Stand up, Tony, and identify yourself.
    Mr. Coles. Tony Coles.
    Mr. Giuliani. Senior advisor to the mayor.
    We are very concerned about the effect of both the Federal 
welfare reform bill and the immigration bill on legal 
immigrants. And I could give you an analysis of the numbers and 
the dollar impact of it. But beyond that, I am very concerned 
about the essential unfairness of what both of those bills will 
do.
    We have many, many legal immigrants in New York City. They 
are allowed in by the Federal Government. We have no voice in 
that, which we should not. Immigration in that respect should 
be controlled by the Federal Government. But we have large 
numbers of legal immigrants. The Federal Government collects 
taxes from those legal immigrants on the same basis that it 
collects taxes from me. And they work in slightly higher 
percentages in New York City, our native New Yorkers do. So 
these are people contributing to the Federal Treasury in large 
measure.
    Now when they become old, or if they become sick, they are 
largely going to be deprived of benefits, which I think is 
fundamentally unfair. I do not think that you take people's 
money on an equal basis to everybody else. And then when they 
have the same difficulty that other people have, you say no, 
you paid in on an equal basis, but we are not going to pay you 
out on an equal basis. I think that there is something over a 
period of time that will erode the notion of America, if we 
allow that to continue.
    The practical problem for the city and the State of New 
York is that all of these illegal immigrants now denied SSI 
benefits and other Federal benefits will remain in the United 
States, as they should. I certainly do not think that they 
should be deported.
    They will remain in the United States, and they will remain 
in the city of New York. And they are going to be sick, and 
they are going to need help. The Federal Government is now 
withdrawn from the field. The city and the State of New York 
cannot. We are not going to let people suffer, die, go in want. 
So the city and the State are going to have to make up the 
difference.
    We are talking about hundreds and hundreds of millions of 
dollars, and a massive cost shift from the Federal Government 
to really four States and the cities in those States. Seventy-
five percent of the mandate, unfunded mandate shift here, is to 
the State of California, Texas, New York, and Florida, because 
those are the places where there is a larger percentage of 
legal immigrants.
    I would suggest that the mandates in the immigration reform 
bill be extended for at least another year. So that we could 
assess what this is going to mean, and how to do it in a fairer 
way and in a more effective way.
    My major objection to the immigration bill and the Federal 
welfare reform bill is we are not acting as partners. We have 
to reform welfare, and we have to reform immigration, but we 
should be sharing in the burdens and the difficulties of doing 
that. The Federal Government should not be pretending to reform 
both, and then shifting all of the costs of doing that to State 
and local governments, and not operating as a partner in doing 
that.
    Because when you do not have to make decisions about your 
own budget, then you tend to have very unrealistic notions of 
how something should be reformed. And what I would like to see 
the Federal Government, first of all, extend the time period, 
so we have more time to assess it. And then to act as a partner 
with us in caring for people who are in need. Not pay for all 
of it, but act as a partner with the city and the State.
    Mrs. Maloney. I think that you are fortunate that Mr. Horn 
and I come from cities and States affected with the problem. We 
have a track record of working very positively together to 
address problems. You mentioned earlier a field trip. I would 
welcome a field trip to New York on just this issue, meeting 
with your staff and trying to figure out what we can do.
    And I certainly would join my colleague in putting forth 
legislation for a 1-year extension. Being in the minority, we 
do not have the votes to reverse policy. But I certainly would 
like to work with my Republican colleagues in trying to get 
that extension renewed.
    But it is something that we should confront right away. And 
I believe that your report said that the changes would cost New 
York City $500 million. That is an awful lot of money. But what 
we are confronting right now and what you were going to be 
getting very soon is not a numbers conversation, but real 
people who have their SSI benefits cut.
    Where do we go in the city for the 95 year old woman who 
has just got her SSI benefits cut, cannot speak English, and 
has Alzheimer's, and cannot take the test to become a citizen; 
what office, and how are we going to process these people?
    Do you understand what I am saying, where do I call? Last 
week, we got 20 phone calls in my office alone. And it is 
probably happening in every office across the city.
    Mr. Giuliani. There are several places to go. The 
Department of the Aging, if it is a person who is elderly and 
needs help.
    Mrs. Maloney. But Mr. Mayor, they are not going to have a 
direct----
    Mr. Giuliani. The Agency of Immigrant Affairs.
    Mrs. Maloney. They are not going to have a direct grant for 
these people. In other words, they are used to a Federal grant 
for their life subsistence, and if that grant is cut, unless 
things have changed since I was a city council member, there is 
no city program that will be a direct grant to help that 
person.
    Mr. Giuliani. They are all going to be eligible for home 
relief. And previously, people who went on SSI were not getting 
home relief. But remember, in New York State, you have a home 
relief program that does not exist in most places for single 
adults. In other States, there might not be anything available. 
But in New York, home relief is available.
    Mrs. Maloney. How much do you think that the shift is going 
to cost New York in the home relief burden?
    Mr. Giuliani. That was part of our estimate of $500 million 
shift of cost.
    Mrs. Maloney. A year?
    Mr. Giuliani. It probably is going to be more than that. 
But I can get for you our estimates of how much the cost shift 
will be, and how fast that will take place. Most of it will 
take place on people coming off SSI, and going into the home 
relief program.
    Mrs. Maloney. Another area that Anne Reynolds--is my time 
up, Mr. Chairman?
    Mr. Horn. Your time has, but go ahead.
    Mr. Giuliani. The way that you reduce that, which is 
something we are doing right now, the way that you reduce that 
burden is by making as many people in those categories, when 
you can, citizens.
    Mrs. Maloney. My office is working to do that very rapidly. 
And we probably have the best record of any office in the city 
for achieving that result. But some people are just mentally 
incapable because of their age of taking the test, and of 
making that happen.
    Very briefly, this committee has jurisdiction over land 
transfers for cities.
    And who would I work with on your staff on the Governor's 
Island problem, and how would you like to work jointly with the 
Federal Government to solve that; who would I work with on your 
staff?
    Mr. Giuliani. Deputy Mayor Randy Mastro would be the 
person.
    Mrs. Maloney. Would you ask him if he would meet with me 
maybe in 2 weeks on that, so we can figure out what would be 
the best way to do it?
    Mr. Giuliani. Yes.
    Mrs. Maloney. A second problem that has come to my office, 
and again it has probably come to your office, is the problem 
of welfare recipients who are attending college now. And Anne 
Reynolds said roughly 5,000 no longer were eligible under the 
Federal changes to continue as college students, and to have 
that count as their workfare.
    And she also mentioned something that would be very easy to 
change on the city level. She said that the problem was that 
the city guidelines said that students who were in college 
could not use their 20 hours working at college as a teacher's 
aide or whatever. That would really help keep our young people 
in college, if we could have that adjustment. And I just want 
to mention that to you and see.
    Mr. Giuliani. I have a different view than Anne Reynolds 
does on this. I think that you have to consider in all of that 
the minuscule graduation rate in the city colleges. The city 
college graduate rate for community colleges is below 5 
percent. I want to say that one more time. It is below 5 
percent.
    And city colleges largely with one or two exceptions 
operate with no standard. So you do not have grade standards of 
any kind. My fear is that we are continuing in that college 
system the dependency model that we are trying to turn around 
with the welfare system.
    That we are not graduating anyone. And we are reinforcing 
all of the worse messages of a dependency society. And the work 
experience for these students is often the single most 
meaningful experience that we are going to give to youngsters 
who are in this community college setting. Because the 
educational component of it, at least by any standards that 
anyone can make, is not working when you have a 5 percent 
graduation rate.
    And to prepare these young people for life, they have to be 
able to understand that they must remain in the workforce. 
Because if they do not, you have terrible tragedies that occur 
later. The lack of standards in the New York City community 
colleges, not all but looked at broadly, really is appalling 
and frightening, and frightening for what it means in the 
future.
    What we ask students to do is to work 20 hours a week. And 
if we were to say that would just be done on the campus of the 
community college, the same lack of standards in education 
would apply to work, and nothing would happen for these young 
people. No education, no work.
    That is just the truth, Congresswoman. That is just the 
reality of what we face, which the bureaucracy of the college 
system does not want to tell you. What I have to worry about is 
what happens to these youngsters 3, 4, 5, and 6 years from now. 
And let us think of what we are asking of them.
    Because what I am trying to reestablish in the city of New 
York, in which the chancellor has not been particularly 
helpful, is a social contract. That is what all of this 
testimony about welfare is about.
    It would work something like this. For every benefit, there 
is an obligation. For every right, a duty. That has to be 
reinforced in everyone, the Mayor, the poorest person, the 
richest person. And the fact is that here are youngsters whose 
education is being paid for by someone else, and who are also 
asking someone else to support them. Essentially, they are 
asking other citizens to take money out of their pockets, pay 
them for their college education, and pay them salary benefits 
beyond that.
    Now in return for that, they should be asked to do 
something in return. They are not asked to maintain any grade 
point average of any kind. They should be asked at least to 
work in exchange for that. That is a good thing to do for them. 
That is wiser, more compassionate, and more decent than what 
the community college system is doing for them.
    It is in a more meaningful way and in a more decent way 
getting them ready for life. Just as I would with my own 
children, build in the sense and the ability that they are 
going to have to take care of themselves.
    And I cannot think of an area in which young people are 
being disserved more than with a system that refuses to reform 
itself that has a 5 percent graduation rate, and is resisting 
20 hours of work by students whose education is paid for by the 
taxpayers, and who are also being supported by the taxpayers.
    It is a vestige of the dependency society that we have 
turned around in other areas. And I hope that we can move on to 
a higher understanding of it, a more compassionate and a more 
decent understanding.
    Mr. Horn. If I might----
    Mrs. Maloney. If I could, because this is very important I 
believe to the city of New York.
    Respectfully, many studies show that if you want to break 
the cycle of poverty, really a college education, 2 years of 
college, that any additional education helps break that cycle. 
And I would like to request that you meet with me and Mrs. 
Reynolds. And maybe we could get a common ground of some 
standards, some effort to help in some way for the young people 
that reach certain standards to stay in college.
    Mr. Giuliani. The best thing that Anne Reynolds could do is 
support workfare for the youngsters that are in the college 
system, and reinforce in them the notion that working for your 
college education is probably going to prepare you for success 
in life, much better than remaining in basically a standardless 
educational system.
    And that there is nothing onerous, and certainly nothing 
punitive, about asking a youngster whose education is being 
paid for by someone else, and who is being supported by someone 
else, to work 20 hours a week.
    Mr. Horn. I am going to have to intervene.
    Mr. Giuliani. I also have to disagree with you, 
Congresswoman, because I have looked at the studies on welfare. 
The single most important thing to move someone out of welfare 
dependency is not education. It is work, and then education.
    Mrs. Maloney. Would you allow them to use their 20 hours in 
school, in other words work in the school while they are going 
to school? That would be a middle ground.
    Mr. Giuliani. If I turn over the workfare program to the 
community colleges, as I said before, we will have the same 
lack of accountability and standards in the workfare program as 
they are presently demonstrating in their inability to educate 
young people.
    Mr. Horn. The time of the gentlelady from New York has long 
expired.
    I want to clarify the record here, because it is quite 
confusing. As you know, one of the aid programs, besides the 
Pell grants, which the last Congress put at the highest level 
they have ever been, and the Stafford grants and other loan 
programs, direct loans, guaranteed student loans, all of that, 
in between is the college work-study program, where they can 
work up to 20 hours a week. The university pays them minimum 
wage or sometimes more based on experience.
    And that is a very useful product. And the Federal 
Government years ago authorized those individuals to work with 
nonprofits in the community. Now I want to separate that 
program out from what I think the mayor is advocating. And I am 
not sure, because it is a little muddy, the exchange.
    But the degree to which the people of the city of New York 
fund the colleges, am I understanding that you feel at least 20 
hours of work ought to be contributed by those whose tuition 
and expenses are paid, or are you talking about work-study?
    Mr. Giuliani. People who in addition have their tuition 
paid for. They are not asked to work, if they are having their 
tuition paid for. They also want to get welfare. In other 
words, they are going to college. And at the same time, they 
want to receive welfare payments from the city of New York.
    If you want both, a free education and welfare benefits, 
when what we ask is you work 20 hours a week. If all you are 
doing is seeking a free education, you are not required to 
work. But if you are seeking a free education, a largely free 
education, and welfare benefits, which after all in theory were 
intended for people without employment, if you want both, then 
you are asked like everyone else is to work.
    The usual welfare recipient has to work 26 hours a week. 
The accommodation made to students is that they have a part-
time job. They have to work for 20 hours a week. If you want 
additional welfare benefits, in other words the home relief 
benefits beyond just a free education.
    Mr. Horn. And that has been recommended to the City College 
Board, has it, the Board of Trustees?
    Mr. Giuliani. The City College bureaucracy has 
unfortunately done everything that it could to undermine the 
workfare component of that. And my reluctance to allow them to 
manage the workfare program is that they have had such poor 
results managing the thing that they are supposed to do, which 
is educating young people in the community college system.
    When you have a graduation rate of 5 percent, actually it 
is less than 5 percent--and if it were not for Kingsborough 
Community College, which has a graduation rate of about 35 
percent, there would be almost no graduation rate in the rest 
of the community college system.
    They basically have a disaster going on that is being 
covered over by political correctness and ideology, and fear of 
really facing it.
    Mr. Horn. How are the board members selected for the City 
College of New York System?
    Mr. Giuliani. The board members are selected by the 
Governor and mayor, and they have terms. So it is only 
recently, like within the last couple of months, that I have 
been able and the Governor has been able to replace the board 
members. So we now, I believe, have a majority.
    Mr. Horn. So there is a chance for this revolution to 
occur, I take it?
    Mr. Giuliani. It will occur.
    Mr. Horn. You just need a few more votes?
    Mr. Giuliani. Yes.
    Mr. Horn. The City College system is in the 1930's and 
1940's. It was among the most distinguished in the United 
States. I think more people went on for the doctorate than any 
other university system in America. But you are talking about 
the community college portion of that system.
    Mr. Giuliani. There has been a similar deterioration, I say 
similar, there has also been deterioration, but not to the same 
degree as other parts of the system. And much of it has to do 
with the unwillingness to have standards and accountability. 
Precisely what we were testifying about before, the inability 
and the unwillingness to measure performance.
    There is no requirement of grade point average, if you want 
benefits or additional benefits. There is a fear. There is a 
fear that is eroding the whole system of being held 
accountable.
    Mr. Horn. I think that is very interesting testimony. Let 
me just close the hearing, since we have other hearings.
    Mrs. Maloney. Let me ask one very positive question for the 
city of New York.
    Mr. Horn. One minute.
    Mrs. Maloney. You gave a very good idea that would address 
one of the problems that our city confronts. I do not know 
whether we could pass it in this Congress, but it is certainly 
something that I support.
    What other ideas do you think we could do here in the 
Federal Government that would be helpful in helping I think, 
the greatest city, in solving some of the complex problems that 
we have?
    Mr. Giuliani. I think that we could carry through in theory 
and practice the notion of not imposing unfunded mandates, and 
really understanding what that means. I believe that city 
governments in America right now are among the most vital 
governments that are operating, not just New York City.
    I know that many of my fellow mayors are doing very similar 
things in their cities. The Federal welfare reform bill and the 
immigration bill, to the extent that they are massive unfunded 
mandates, should be changed, and that we should deal with this 
as partners.
    If vast cost shifts are going to take place to cities, then 
the Congress should be more willing to listen to I think a 
different type of mayor than now exists. Mayors in major 
American cities used to be called the Tin Cup Brigade. They 
would come before the State legislature with a tin cup asking 
give us money, give us money, and blame you for our problems, 
because you were not giving us enough money.
    I am not coming here in that way. I am saying hold me as 
accountable as I would like to hold the Community College 
system. And also, the Federal Government cannot be establishing 
unrealistic mandates. Seventy percent of the people off welfare 
in 2 to 3 years, no help, no money, no transitional benefits to 
accomplish that, that is just unrealistic. There are the areas 
where I think that you need much more of a partnership in both 
levels of Government being held accountable.
    Mrs. Maloney. You have pinpointed the biggest problem in 
the welfare bill.
    Mr. Horn. I am going to have to let the New York discussion 
be in the written record afterwards, because we did make a 
commitment to be out of here by 12:30.
    I want to note, Your Honor, that your testimony is 
absolutely vital to what we are trying to accomplish with the 
Federal Government. And that is a results-oriented approach. 
And we intend to make good use of your testimony. And when we 
distribute the report, just your testimony, I plan to send that 
to every Member of Congress. I think that they ought to look at 
what you are doing, and get that seed of creativity going in 
their areas.
    I would like to discuss with you for 1 minute the tax 
situation. There has been a report from the District of 
Columbia that there ought to be more innovative ways to attract 
business, and attract people to the District of Columbia, this 
is the Kemp Commission, either by changing the rate at which 
they are paid, or giving them a special benefit in what is 
essentially, and you have many of those too, distressed 
economic areas.
    And I just wondered if you have any thoughts on that aspect 
on how we save our cities by a decent Federal tax policy. This 
is not the committee that can do something about it, but if we 
can air it.
    Mr. Giuliani. They work. Incentive programs to businesses 
work, as long as you solve some of the other fundamental 
problems. And that is why crime reduction is so important to 
us. No matter what kind of incentive program you have, someone 
is not going to establish their business in a place where they 
think that they are going to be killed, or in a place where 
they think that they are going to be mugged and beaten.
    So you have to get yourself to a reasonable degree of 
safety. And then tax incentive programs are enormously 
valuable. We use them. We use them for big businesses, keeping 
them in the city. We use them for a program that I call the 
anchor problem, to establish more business in the distressed 
communities of the city. And it can be enormously valuable to 
give businesses incentives.
    Frankly, the way in which it works the best is to solve the 
fundamental problem. There was an article in New York magazine, 
a cover article, about a month ago, pointing out that in the 
last 2 to 3 years that more positive changes have taken place 
in Harlem than in all of the last 20 years combined.
    I am very proud of that article. Because the reason for 
that is we have solved some of the fundamental problems that 
have alluded the city in the past. Reducing crime dramatically. 
Removing illegal street vendors. Now national corporations are 
investing in Harlem for the first time. We also give them 
incentives to do that. But the incentives were there before. 
But it was not working, because people had these other 
fundamental problems that were preventing them from investing.
    Mr. Horn. Well, I thank you for that.
    I am going to close with one little story about my previous 
interaction with the mayor of New York City. And that is back 
in the Lindsay administration. I was 1 of the 10 Kennedy 
fellows at the Institute of Politics at Harvard at the time, 
and happened to have the good mayor up to my seminar on the 
future of the Republican party.
    And while he was there, he met with us. And he said, ``Why 
don't you guys spend a couple of days with me in New York, and 
I will show you what it is really like.'' And we said, 
``Great.''
    So in April, we went down in 1967. And the Governor was 
there, and we met with him. And then he and John Lindsay 
together met with us. And they got us off looking at different 
aspects of the city.
    And the comment that I want to close with is the one that 
Governor Rockefeller made. He said, ``You know, John has got a 
tougher job than I do.'' And, of course, we believed that 
without him telling us. Because as we approached city hall, 
there were barriers. There were pickets. There were strikes. 
Just a typical day in the life of the mayor.
    But I thought that it was good, because they were always 
supposed to have this feud going on, that the Governor, I think 
that his in-town office was on 54th Street or something, in 
that area. And the Governor said, ``Nobody can get after me. I 
am either in Albany or where they cannot find me in New York. 
John, they can find,'' and they did.
    And I think that is correct. Being a mayor in this day and 
age, the last 50 or even 100 years, is the toughest job in the 
United States. And I think you have showed us what a mayor with 
imagination and vision can do in helping to turn a city around 
when everyone else had given up, very frankly.
    So I thank you very much for coming. And I wish you well in 
the years ahead.
    And with that, this hearing is adjourned.
    [Whereupon, at 12:40 p.m., the subcommittee was adjourned.]

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