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



 
                   LEGISLATIVE BRANCH APPROPRIATIONS

                                FOR 1999

========================================================================

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED FIFTH CONGRESS

                             SECOND SESSION
                                ________

                       SUBCOMMITTEE ON LEGISLATIVE
                   JAMES T. WALSH, New York, Chairman

C. W. BILL YOUNG, Florida              JOSE E. SERRANO, New York
RANDY ``DUKE'' CUNNINGHAM, California  VIC FAZIO, California
ZACH WAMP, Tennessee                   STENY H. HOYER, Maryland
TOM LATHAM, Iowa                       

NOTE: Under Committee Rules, Mr. Livingston, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.

                   Edward E. Lombard, Staff Assistant
                                ________

                                 PART 2

                   FISCAL YEAR 1999 LEGISLATIVE BRANCH
                         APPROPRIATION REQUESTS

                              

                                ________

         Printed for the use of the Committee on Appropriations
                                ________

                     U.S. GOVERNMENT PRINTING OFFICE
46-679 O                    WASHINGTON : 1998
------------------------------------------------------------------------

             For sale by the U.S. Government Printing Office            
        Superintendent of Documents, Congressional Sales Office,        
                          Washington, DC 20402                          







                       COMMITTEE ON APPROPRIATIONS                      

                   BOB LIVINGSTON, Louisiana, Chairman                  

JOSEPH M. McDADE, Pennsylvania         DAVID R. OBEY, Wisconsin            
C. W. BILL YOUNG, Florida              SIDNEY R. YATES, Illinois           
RALPH REGULA, Ohio                     LOUIS STOKES, Ohio                  
JERRY LEWIS, California                JOHN P. MURTHA, Pennsylvania        
JOHN EDWARD PORTER, Illinois           NORMAN D. DICKS, Washington         
HAROLD ROGERS, Kentucky                MARTIN OLAV SABO, Minnesota         
JOE SKEEN, New Mexico                  JULIAN C. DIXON, California         
FRANK R. WOLF, Virginia                VIC FAZIO, California               
TOM DeLAY, Texas                       W. G. (BILL) HEFNER, North Carolina 
JIM KOLBE, Arizona                     STENY H. HOYER, Maryland            
RON PACKARD, California                ALAN B. MOLLOHAN, West Virginia     
SONNY CALLAHAN, Alabama                MARCY KAPTUR, Ohio                  
JAMES T. WALSH, New York               DAVID E. SKAGGS, Colorado           
CHARLES H. TAYLOR, North Carolina      NANCY PELOSI, California            
DAVID L. HOBSON, Ohio                  PETER J. VISCLOSKY, Indiana         
ERNEST J. ISTOOK, Jr., Oklahoma        ESTEBAN EDWARD TORRES, California   
HENRY BONILLA, Texas                   NITA M. LOWEY, New York             
JOE KNOLLENBERG, Michigan              JOSE E. SERRANO, New York           
DAN MILLER, Florida                    ROSA L. DeLAURO, Connecticut        
JAY DICKEY, Arkansas                   JAMES P. MORAN, Virginia            
JACK KINGSTON, Georgia                 JOHN W. OLVER, Massachusetts        
MIKE PARKER, Mississippi               ED PASTOR, Arizona                  
RODNEY P. FRELINGHUYSEN, New Jersey    CARRIE P. MEEK, Florida             
ROGER F. WICKER, Mississippi           DAVID E. PRICE, North Carolina      
MICHAEL P. FORBES, New York            CHET EDWARDS, Texas                 
GEORGE R. NETHERCUTT, Jr., Washington  ROBERT E. (BUD) CRAMER, Jr., Alabama
MARK W. NEUMANN, Wisconsin             
RANDY ``DUKE'' CUNNINGHAM, California  
TODD TIAHRT, Kansas                    
ZACH WAMP, Tennessee                   
TOM LATHAM, Iowa                       
ANNE M. NORTHUP, Kentucky              
ROBERT B. ADERHOLT, Alabama            

                 James W. Dyer, Clerk and Staff Director










         LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              

                                        Thursday, January 29, 1998.
    Mr. Walsh. We will now commence our hearings on the 1999 
budget for various legislative branch agencies under the 
jurisdiction of the Subcommittee on Legislative Appropriations.
    Before we begin, I would like to welcome the Members of the 
subcommittee. We have the same membership as we had in the 
first session of the 105th Congress with one exception.
    The Members are, in addition to myself, for the Majority: 
Bill Young of Florida; Duke Cunningham of California, who has 
been designated Vice Chairman; Zach Wamp of Tennessee; and Tom 
Latham of Iowa.
    And Tom is here with us this morning. Thank you, Tom, for 
coming.
    For the Minority: Congressman Jose Serrano of New York is 
the Ranking Minority Member.
    Welcome back. Good to see you.
    Vic Fazio of California.
    And also the change is Steny Hoyer of Maryland will be 
replacing Marcy Kaptur of Ohio. We will miss Marcy, and we 
welcome Steny.
    We have the Chairman of the full Committee on 
Appropriations, Bob Livingston of Louisiana; and Dave Obey, 
Ranking Minority Member of the full committee from Wisconsin. 
They are also Members of the subcommittee.
    The subcommittee jurisdiction--I will insert in the record 
at this point the current jurisdiction of the subcommittee, 
which has been established under the rules of the Committee on 
Appropriations.
    [The information follows:]

                      Subcommittee on Legislative

    House of Representatives.
    Joint Items.
    Architect of the Capitol (Except Senate Items).
    Botanic Garden.
    Congressional Budget Office.
    General Accounting Office.
    Government Printing Office.
    John C. Stennis Center.
    Library of Congress, including:
        Congressional Research Service.
        Copyright Arbitration Royalty Panel.
        Copyright Office.
        National Film Preservation Board.
    United States Capitol Preservation Commission.

    Mr. Walsh. We should remind everyone that several agencies 
included as legislative branch agencies in the President's 
budget are not under the jurisdiction of this subcommittee. For 
example, the U.S. Tax Court is one agency classified as a 
legislative agency in the President's budget, but that agency 
is actually funded in Commerce, Justice, State. Likewise, the 
Helsinki Commission, the Prospective Payment Commission and 
several other agencies are not within our bill.
    The President's budget has not yet been delivered to 
Congress. However, for the past several weeks, the legislative 
agencies and all Federal agencies have been submitting their 
budget material to the Office of Management and Budget in 
preparation for the expected delivery to the Congress on Monday 
of next week.
    Under statute, the legislative budget must be submitted to 
the Congress in the President's budget without change by OMB. 
During the process of preparing the Federal budget for 1999, we 
have asked those agencies under our jurisdiction to provide 
copies to the subcommittee of the material they are sending to 
OMB. We did that in order to get an early start. This has been 
the customary practice over the years, and both Majority and 
Minority have concurred.
    The staff has compiled the customary budget material for 
use of the Members of the subcommittee.
    The draft Subcommittee Print has been provided to the 
Members as a working document. That is this. Right?
    Mr. Lombard. Yes, sir.
    Mr. Walsh. It contains the bill language and funding 
requests that will be included in the President's budget 
documents, primarily in the budget appendix. The Subcommittee 
Print is labeled as a draft since the formal budget submission 
has not arrived. We believe it will not change in any 
significant extent, if at all. The print also contains a great 
deal of historical information that the Members may find 
useful.
    Part 1 of the Legislative Branch Appropriations Hearings 
for 1999 has also been distributed to the Members. It is this 
book here. It contains the budget justifications that the 
agencies have prepared in explanation of their budget requests.
    Part 1 will be made available as a public document when the 
hearings are completed.
    The budget we are going to consider in this subcommittee 
totals $1.9 billion. That is up--and, again, this is the 
request. That is up 11 percent over last year. That figure does 
not include the operating budget of the Senate. That budget 
will be taken up--the Senate budget will be taken up by our 
counterpart subcommittee in the other body.
    Let me be clear, the budget request for the legislative 
branch without the Senate is up 11 percent.
    The budget for congressional operations is $1.2 billion. 
That encompasses the operating budget of the House, the Joint 
Committees and various support agencies, such as Capitol 
Police, the Architect, the Congressional Budget Office, the 
Office of Compliance, the Congressional Research Service and 
Congressional Printing.
    The balance of the funds, $718 million, is for the other 
agencies in the legislative branch, including Library of 
Congress, Superintendent of Documents, the Federal Depository 
Program, General Accounting Office, Botanic Garden and the care 
of the Library grounds by the Architect.
    I want to stress that these budgets have already been 
submitted separately and independently to the Office of 
Management and Budget by each of the legislative branch 
agencies. By law, OMB will include these budget requests in the 
President's budget without change.
    Since OMB cannot, by law, and should not, make policy or 
dollar-level changes in these legislative budgets, this 
committee will perform a double function.
    We will scrub these budgets much the same as OMB does with 
executive agency budgets. That is a function OMB performs 
before the executive appropriation requests are presented to 
the Congress. That is a policy scrub. Our agency heads more or 
less apply their own policy judgments to these budgets as they 
are being prepared. Our committee is the first and only stop 
along the way which looks at the entire legislative branch 
budget in its totality for the broader budgetary implications 
for this part of government.
    In addition, when the--and you may have been familiar with 
the term 602(B) allocations, they are now referred to as 302(B) 
allocations, which I am told is what they used to be called. So 
what goes around, comes around. Henceforward, 602(B) 
allocations shall be known as 302(B) allocations.
    When they are made by the Full Committee, we will mark up 
the legislative branch appropriations bill to conform with 
Congress' overall budget targets. That is the more traditional 
appropriations process.
    As we proceed through this process, we will consult with 
the authorizing committees--House Oversight, Budget, Government 
Reform, perhaps Judiciary, if necessary. So the bill we bring 
to the floor will undergo several adjustments, and I fully 
expect reductions will be made along the way, especially 
considering the requests are up 11 percent.
    So the $1.9 billion request will undergo careful scrutiny. 
Undoubtedly, it will be adjusted downward. We will evaluate the 
requests and the answers we get as we proceed with our 
hearings. I am certain we will find areas where we will not be 
able to fund all that is needed or justified.
    The committee intends to be fair as well as fiscally 
responsible. We also expect our constituent agencies to be 
aware of the importance of bringing the Federal budget into 
balance.
    My intention is to insure that the legislative branch 
contributes its fair share to that objective.
    That is the end of my opening statement, and I would 
welcome any other opening statements from other Members, and I 
will begin with Congressman Serrano.
    Mr. Serrano. Thank you, Mr. Chairman.
    I just want to, first of all, tell you I look forward to 
working with you this year.
    As you know, last year you and I made a very serious 
attempt at having no stumbling blocks before this bill; but, 
unfortunately, as many people and the press know, our bill 
became involved in much larger issues on the House floor and, 
for a while, confused a lot of people who thought there was a 
problem with the bill when, in fact, our disagreements were 
maybe 5 percent based on the bill and 95 percent based on 
something else.
    Hopefully, this year that issue won't be an issue; and, if 
it is, I will try to direct it towards another bill and not 
this one.
    Mr. Walsh. Very much appreciate that.
    Mr. Serrano. I want to tell you that I look forward to 
working with you this year. You and I take this work very 
seriously. I know that there is always kidding around in our 
full Committee about who wants to serve on this committee, 
because the only fact-finding trip you can take is to the 
Library of Congress.
    Mr. Walsh. Which is loaded with facts, by the way.
    Mr. Serrano. Exactly, which confuses a lot of people.
    But our work is very important, especially these days when 
so many people outside this institution are taking very serious 
looks at how we do our work and how our agencies do their work 
and how the Congress in general functions. We take this work 
very seriously.
    I know that our schedule is quick and tight this year as we 
try to finish with our hearings and move on with the bill, and 
I look forward to a very good and productive session.
    Mr. Walsh. Thank you very much.
    Mr. Latham, any opening comments?
    Mr. Latham. It is an honor to be here with you, sir.
    Mr. Walsh. It is great to have you back.
                                        Thursday, January 29, 1998.

                     U.S. HOUSE OF REPRESENTATIVES

                               WITNESSES

HON. JAY EAGEN, CHIEF ADMINISTRATIVE OFFICER, OFFICE OF THE CHIEF 
    ADMINISTRATIVE OFFICER
FRANK DERVILLE, ASSOCIATE ADMINISTRATOR, OFFICE OF FINANCE, OFFICE OF 
    THE CHIEF ADMINISTRATIVE OFFICER
HON. ROBIN H. CARLE, CLERK, OFFICE OF THE CLERK
JEFF TRANDAHL, DEPUTY CLERK, OFFICE OF THE CLERK
HON. WILSON S. LIVINGOOD, SERGEANT AT ARMS, OFFICE OF THE SERGEANT AT 
    ARMS
JOHN W. LAINHART IV, INSPECTOR GENERAL, OFFICE OF THE INSPECTOR GENERAL
BOB FREY, DEPUTY INSPECTOR GENERAL, OFFICE OF THE INSPECTOR GENERAL
GERALDINE R. GENNET, GENERAL COUNSEL, OFFICE OF THE GENERAL COUNSEL
JOHN R. MILLER, LAW REVISION COUNSEL, OFFICE OF THE LAW REVISION 
    COUNSEL
M. POPE BARROW, LEGISLATIVE COUNSEL, OFFICE OF THE LEGISLATIVE COUNSEL
DR. JOHN F. EISOLD, ATTENDING PHYSICIAN, OFFICE OF THE ATTENDING 
    PHYSICIAN
    Mr. Walsh. We will now take up the budget request for the 
House of Representatives and several joint items.
    The Chief Administrative Officer, assisted by the Office of 
Finance, submits the House budget each year to the Office of 
Management and Budget. The material is then included in the 
President's budget. The budget this year has already been 
submitted to OMB and is incorporated in the budget documents 
that present the entire Federal budget for 1999.
    The House budget request totals $765.6 million. That 
includes funds for the operations of Member offices, 
committees, the leadership and the administrative operations of 
the House.
    The total joint items budget is $97.7 million. The joint 
items, such as the joint committees and Capitol Police, are 
shared with the Senate. The fiscal year 1999 budget for the 
Senate operations will be considered by the other body.
    We want to welcome the officers of the House who are with 
us here today. Is Robin Carle here this morning?
    Welcome, Robin.
    Ms. Carle. Good morning.
    Mr. Walsh. The Honorable Wilson Livingood, Sergeant at 
Arms, is also here. Welcome, Bill.
    And the Honorable Jay Eagen, Chief Administrative Officer. 
Welcome, Jay.
    We also have John Lainhart, the Inspector General; Ms. 
Geraldine Gennet, is it?
    Ms. Gennet. Yes.
    Mr. Walsh. Gennet?
    Ms. Gennet. Yes.
    Mr. Walsh. Thank you. Welcome. The House Counsel.
    John Miller, Law Revision Counsel; and Pope Barrow, is that 
correct?
    Mr. Barrow. Yes, right here.
    Mr. Walsh. Legislative Counsel.
    We also expect Dr. Eisold, the Attending Physician, to join 
us later.
    Mr. Eagen is the Chief Financial Officer for the House and 
will be presenting the fiscal year 1999 budget to the 
committee. Jay is the de facto budget officer and is capably 
assisted in that area by the House Finance Office's, Mr. Frank 
Derville, who is the head of that office; and we are pleased to 
have him here also. We welcome both of you to the witness 
table.
    Jay and Frank are new to the hearings. Both of you were 
appointed to these jobs last year, although you are not 
unfamiliar with our operations prior to that, well after our 
appropriations hearings had begun. We have been working with 
you and Frank for the past several months, and it is apparent 
that each of you was an excellent choice for these important 
assignments.
    As is customary for first time witnesses, we will ask that 
your biographical sketches be inserted in the record at this 
point.
    [The information follows:]

 Jay Eagen, Chief Administrative Officer, U.S. House of Representatives

    Jay Eagen was sworn in by Speaker Newt Gingrich as the 
Chief Administrative Officer (CAO) of the United States House 
of Representatives on July 31, 1997 after approval of his 
nomination by the House. He was selected through a competitive 
process via a nation-wide search undertaken by the 
international personnel firm, Korn/Ferry International. A 
bipartisan search committee comprised of Rep. Bill Thomas (R-
Calif.), Rep. Vic Fazio (D-Calif.), Rep. Bob Ney (R-Ohio) and 
Rep. James Clyburn (D-S.C.) then unanimously selected Mr. 
Eagen.
    Prior to his present position, Jay has had an extensive 
career of public service on Capitol Hill lasting fifteen years. 
For six years, Mr. Eagen served as Staff Director for the 
Republican staff of the Committee on Education and the 
Workforce (formerly Committee on Education and Labor) under 
Chairman Bill Goodling of Pennsylvania. From 1985 to 1991 he 
directed the personal office for Rep. Goodling as his chief of 
staff. Jay began his career in the House of Representatives as 
a Legislative Assistant in 1982 and a year later was appointed 
administrative assistant/chief of staff to Rep. Steve Gunderson 
of Wisconsin.
    Mr. Eagen is a native of Clarks Summit, Pennsylvania. He 
graduated with a history degree from Gettysburg College in 
1979. He continued his education immediately at American 
University's School of International Service, receiving a 
masters degree with distinction, specializing in U.S. foreign 
policy and Western European relations. Jay also attended the 
Senior Managers in Government executive program at the John F. 
Kennedy School of Government.
    The Chief Administrative Officer, one of three officers 
elected by the House, oversees the broad administrative 
operations of the House including finances, technology/
communications, human resources, equipment, supplies and 
procurement. The CAO is supported by a team of Associate 
Administrators who direct the individual unit operations.
    Jay is married to Catherine Rauth Eagen, a native of 
Michigan. Cathy is a public school teacher at the Thomas 
Jefferson School for Science and Technology, part of the 
Fairfax County School System in Virginia. They reside in 
Alexandria, Virginia.
                                ------                                


                      Frank D. Derville, CPA, CGFM

    Frank Derville is currently the Associate Administrator for 
Finance at the House of Representatives. Prior to this, he was 
a Principal with Derville & Associates, a careerist whose 
public service included the U.S. General Accounting Office, the 
National Aeronautics and Space Administration, the Department 
of Health and Human Services, the Health Care Financing 
Administration and the Department of Veterans Affairs. He also 
served as a corporate controller in the private sector for 
several large corporations.
    Frank has advised domestic and foreign clients on strategic 
planning and business plan development; strategic assessments 
of healthcare market and sector opportunities; financial 
management system assessments and development; financial 
organization configuration and management; financial statement 
preparation, analysis and use; costing and pricing strategies; 
acquisition support; and software quality assurance.
    He frequently lectures on financial policy requirements, 
budget planning and execution, financial statement preparation 
and analysis, federal financial system requirements and long 
range strategic planning.
    Frank's public and private positions provided the critical 
experience necessary to nurture the creativity and 
innovativeness that is readily apparent in his accomplishments.
    As the Deputy Assistant Secretary for Financial Management 
at the Department of Veterans Affairs he updated and automated 
financial policy and procedures, procured and installed an 
integrated Departmental financial management system, created a 
comprehensive program audit activity, designed and implemented 
a third party cost recovery program, redefined central office 
and field financial officer responsibilities and implemented 
the Chief Financial Officers Act.
    As the Deputy Bureau Director, Health Care Financing 
Administration, Frank directed the implementation of the 
Medicare Catastrophic Legislation (prescription drugs), 
developed and oversaw the nationwide implementation of HCFA's 
Medicare Secondary Payer recovery program, planned and 
implemented the Medicare Automated Network.
    As the Director, Office of Financial Management for the 
Health Care Financing Administration, Frank implemented a new 
on-line financial management and reporting system, revised the 
methodology used to prepare and submit the national Medicaid 
budget and restructured the format and presentation of the 
Medicare contractor budget.
    While the Controller of USM Corporation, he streamlined 
financial reporting, initiated a strategic planning process 
which expanded profitable product lines and reduced bad debt 
expense by 200% and installed a direct cost system.
    Frank is a Certified Public Accountant, a Certified 
Governmental Financial Manager, a member of the American 
Institute of Certified Public Accountants, the Association of 
Government Accountants and the Federal Financial Managers 
Council. He has served as the Chairperson of the Federal 
Financial Managers Council and as a Director of the Washington 
Chapter of the Association of Government Accountants.

    Mr. Walsh. Before we begin, why don't you briefly outline 
your backgrounds so that our members are familiar; and if there 
is anyone else you would like to introduce, please feel free.

                         mr. eagen's background

    Mr. Eagen. Okay. Thank you, Mr. Chairman. Mr. Serrano, Mr. 
Latham, good morning.
    I am a 16-year veteran of Capitol Hill. I guess I am one of 
those that started at the bottom and worked his way up through 
the system.
    I served as a legislative assistant for Congressman Steve 
Gunderson, became his chief of staff or administrative 
assistant and then moved over to Bill Goodling's office as 
chief of staff. I then moved down to what was then called 
Committee on Education and Labor as the Minority staff director 
and eventually became the Majority staff director before 
becoming the CAO.
    Mr. Derville. I have a little over 30 years' experience 
with the Federal Government and outside of the Federal 
Government.
    Most of my experience prior to here has been with the 
executive branch of the Federal Government. My last Government 
position before this was ``Deputy Chief Financial Officer'' for 
the Department of Veterans Affairs.
    I am a Certified Public Accountant. I am a Certified 
Government Financial Manager, and I have experience both on the 
industry side as well as the government side of financial 
management.
    I also worked at the Health Care Financing Administration 
for about 7 years as the Deputy Director for program operations 
of the Medicare and Medicaid programs.
    Mr. Walsh. Well, compared to the health care budget in the 
country, this should be a snap.
    Mr. Derville. Yes, sir.
    Mr. Eagen. Mr. Chairman, if I could, I would like to also 
introduce Tim Campen, who is the new director of House 
Information Resources and is seated behind us.
    Mr. Walsh. The practice for these hearings is that the CAO 
will present the overall budget statement which has already 
been supplied to the members. Jay, in turn, will ask for House 
officers and others present to present their budgets when you 
get to that point.
    Please proceed, and we will ask questions as they arise.

                     mr. eagen's opening statement

    Mr. Eagen. Thank you, Mr. Chairman.
    It is a pleasure to be appearing before the subcommittee 
for the first time to testify on the budget for the House of 
Representatives.
    I was appointed to the position, as you noted, on August 
1st, 1997. With nearly 6 months on the job, I can say this has 
been both an educational and a rewarding experience in many 
ways.
    As established at the beginning of the 104th Congress, the 
CAO is the chief budget officer of the U.S. House of 
Representatives and is responsible for the presentation of the 
budget before your subcommittee. We sent to the Office of 
Management and Budget all materials which appear in the 
President's annual budget.
    Later in this hearing I will further outline the fiscal 
year 1999 budget request for the offices of the Chief 
Administrative Officer, and I stand ready to assist the 
subcommittee in any way as you work to compile the fiscal year 
1999 legislative branch appropriations bill.
    I recognize that you need to have complete and accurate 
information. We hopefully have anticipated and gathered much of 
that information for you already.
    We look forward to working with the subcommittee on the 
final budget of the House of Representatives before the turn of 
the century.
    The fiscal year 1999 estimates submitted earlier to the 
Office of Management and Budget are reflected in the budget to 
be transmitted to Congress by the President and are detailed in 
your Subcommittee Print.
    This statement and the Subcommittee Print may be used 
jointly to obtain a complete picture of the budget. At the 
beginning of each budget item herein, you will find a reference 
to a related page on the Subcommittee Print where further 
detail is provided.

                       fiscal year 1999 estimates

    The fiscal year 1999 request for the House of 
Representatives totals $765,587,600. This amount is based on 
statutory entitlements, full funding of authorizations, actual 
spending history and consultation with administrative officers. 
This request includes a full-time equivalent reduction of 22 as 
compared with FTE's funded in fiscal 1998.
    This testimony follows the same format of the 
appropriations bill. I will go through each individual line 
item in the bill and mention the current request. I invite any 
questions you may have, and if I am unable to respond today I 
will certainly provide the answer for the record in an 
expeditious manner.
    I submit for the record a chart which itemizes the actual 
fiscal year 1997 expenses, appropriated funds for fiscal year 
1998 and requested funds for fiscal year 1999.
    I also submit for the record the balance of pages 1 through 
3A.
    [The information follows:]

[Pages 10 - 11--The official Committee record contains additional material here.]


    [Questions from Chairman Walsh and responses follow:]

    Question. Before you proceed Jay, the House has reduced its 
budgets and FTE employment significantly. Give the Committee a 
sense of those reductions since the beginning of the 104th 
Congress.
    Response. The following comparative table shows each fiscal 
year appropriation since fiscal year 1995 and estimated 
outlays. The impact of these factors is presented in the 
following chart.

                                                  APPROPRIATION                                                 
----------------------------------------------------------------------------------------------------------------
                                                                                                      Percentage
                         Fiscal year                                 Budget        Actual/Estimated      used   
----------------------------------------------------------------------------------------------------------------
1995.........................................................       $728,468,000       $675,102,210        92.67
1996.........................................................        670,561,000        662,507,482        98.80
1997.........................................................        683,831,000        673,128,740        98.43
1998.........................................................        708,738,000        697,398,192        98.40
----------------------------------------------------------------------------------------------------------------

    From an FTE perspective, there have been significant 
related reductions. The comparative table below shows the 
relationship between funded FTEs and actual usage for fiscal 
years 1995, 1996, 1997 with estimated usage for fiscal year 
1998.

                                              FULL TIME EQUIVALENTS                                             
----------------------------------------------------------------------------------------------------------------
                                                                                                      Percentage
                         Fiscal year                                 Budget        Actual/Estimated      used   
----------------------------------------------------------------------------------------------------------------
1995.........................................................             10,730              9,844        91.74
1996.........................................................              9,889              9,440        95.46
1997.........................................................              9,876              9,384        95.01
1998.........................................................              9,861              9,545        96.79
----------------------------------------------------------------------------------------------------------------

    Question. For the record, prepare a five year table which 
shows the recent history of House funding and FTE levels.
    Response. The information follows:


                                                                        
------------------------------------------------------------------------
               Fiscal year                  Appropriation        FTEs   
------------------------------------------------------------------------
1994....................................       $686,318,000       11,270
1995....................................        728,468,000       10,730
1996....................................        671,561,000        9,889
1997....................................        683,831,000        9,876
1998....................................        708,738,000        9,861
------------------------------------------------------------------------

                        house leadership offices

    Mr. Eagen. Referring to pages 13 through 35 of the 
Subcommittee Print, for salaries and expenses of House 
leadership offices, $12,689,000. Mr. Chairman, I submit for the 
record the balance of pages 4 through 15 and would be happy to 
answer any questions.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 13 - 24--The official Committee record contains additional material here.]


                  members' representational allowances

    Mr. Eagen. Referring to pages 36 through 45 of the 
Subcommittee Print for Members' representational allowances, 
including Members' personnel, official expenses and official 
mail, $412,964,000. Mr. Chairman, I submit the balance of page 
16 for the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Page 26--The official Committee record contains additional material here.]


    [A question from Chairman Walsh and response follow:]

    Question. Funding for Members allowances is appropriated in 
one appropriation line item. For Fiscal 1998, how much are the 
Members authorized to spend, as opposed to the amount we 
actually appropriated? Explain that in terms of each allowance 
component (i.e., clerk hire, official expenses, and mail).
    Response. Subsequent to the combination of Official 
Expenses, Clerk Hire, and Official Mail Allowances into a 
single MRA authorization, the MRA has been treated as a single 
component. The following breakdown of FY '98 MRA authorizations 
are used for informational purposes only and do not reflect 
spending limitations for the individual components of the MRA.

                          FISCAL YEAR 1998 MRA                          
------------------------------------------------------------------------
                                      Authorization      Appropriation  
------------------------------------------------------------------------
Clerk Hire........................       $266,531,430       $265,484,000
Official Expenses.................         85,822,178         87,934,000
Official Mail.....................         50,451,478         26,371,000
                                   -------------------------------------
      Total.......................        402,805,086        379,789,000
------------------------------------------------------------------------

                standing committees, special and select

    Mr. Eagen. Referring to pages 46 through 50 of the 
Subcommittee Print, for salaries and expenses of Standing 
Committees, Special and Select, authorized by House 
resolutions, $90,608,000.

                      committee on appropriations

    For salaries and expenses of the Committee on 
Appropriations, including studies and examinations of executive 
agencies and temporary personal services for such committee, 
$19,731,000.
    Mr. Chairman, I request to submit the balance of pages 17 
and 18 for the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 28 - 29--The official Committee record contains additional material here.]


                    salaries, officers and employees

    Mr. Eagen. Referring to pages 54 through 89 of the 
Subcommittee Print, for salaries and expenses of officers and 
employees, as authorized by law, $92,656,000. Included in this 
amount is $56,828,000, or 61 percent, for personnel, and 
$35,828,000, or 39 percent, for nonpersonnel items.
    The offices funded under this heading include the Office of 
the Clerk, the Office of the Sergeant at Arms, the Office of 
the Chief Administrative Officer, the Office of the Inspector 
General, the Office of the General Counsel, the Office of the 
Chaplin, the Office of the Parliamentarian, the Office of the 
Law Revision Counsel, the Office of the Legislative Counsel, 
the Corrections Calendar Office and Other Authorized Employees.
    Mr. Chairman, I submit the balance of page 19 for the 
record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Page 31--The official Committee record contains additional material here.]


                          office of the clerk

    Mr. Eagen. Referring to pages 57 through 58 of the 
Subcommittee Print, for salaries and expenses for the Office of 
the Clerk, $15,817,000.
    Mr. Chairman, I submit the balance of page 20 for the 
record.
    [The information follows:]

[Page 33--The official Committee record contains additional material here.]


    Mr. Eagen. I am pleased to introduce the Honorable Robin 
Carle, Clerk of the House.
    Mr. Walsh. We would welcome the Clerk to the table at this 
time.

                           opening statement

    Ms. Carle. Good morning, Mr. Chairman, Mr. Serrano, Mr. 
Latham. I am pleased to once again be able to appear before 
your subcommittee to discuss the operations of the Offices of 
the Clerk and to outline the request I have submitted regarding 
the fiscal year 1999 budget cycle.
    Your subcommittee is familiar with my responsibilities as 
the chief legislative officer for the Congress. I am 
responsible for the House's most traditional legislative 
activities and a host of other services and programs related to 
its operation. For your convenience, I have attached to my 
testimony a general organizational chart of the Offices of the 
Clerk and the programs under my purview.
    As I tell people who visit our offices, the actual steps 
and procedures which underpin the legislative processes of the 
House are many and rather remarkable. However, since they are 
performed so quietly, efficiently and professionally by the 
team of employees in the Offices of the Clerk, many Members and 
staff are almost completely unaware of the complexities of 
keeping the organizational systems of the legislative process 
functioning.
    Our goal remains to provide the backdrop and machineryfor 
the legislative process and debate--without influencing the outcome of 
the policymaking. Such a goal is much more complicated than it may 
sound, and it always relies on the professionalism of the staff of our 
offices.
    Traditionally, my office's activity is clearly dictated by 
the legislative schedule.
    Included in my formal statement are statistics on House 
Floor activity. Overall, these statistics show that this was a 
busier than average session but not a record-setting one.

                   fiscal year 1999 budget submission

    Let me summarize the fiscal year 1999 appropriations 
request I have forwarded to the subcommittee for consideration. 
When compared with fiscal year 1998, I am seeking a decrease of 
.92 percent, or $147,000.
    For fiscal year 1999, I am requesting a total for the 
Offices of the Clerk of $15,817,000, of which $11,754,000 is 
being requested for personnel and $4,063,000 for nonpersonnel 
expenses. This request has been achieved by eliminating any 
fiscal year 1999 funds for merit or overtime costs. Such 
expenses for fiscal year 1999 will be absorbed within other 
personnel funds being requested. The request maintains the FTE 
level of 265 people for the Offices of the Clerk.

                       document management system

    In general, the fiscal year 1999 budget plan for the 
Offices of the Clerk maintains funding for a host of projects 
already under way. This includes funding for the continued 
effort to design and implement a comprehensive Document 
Management System for the legislative processes of the House.
    As mandated by this subcommittee, I am continuing to work 
with the secretary of the Senate and other legislative branch 
agencies to establish various electronic information standards 
for the future and to develop seamless information transfer 
capabilities. This effort is central to efforts to reduce the 
costs of printing and information creation while also providing 
expanded options and opportunities to make various forms of 
information publicly available.
    To date, the steps to accomplish this monumental task have 
proven more time consuming and more complex than initially 
anticipated, but it has been beneficial. The process has forced 
a much clearer definition of the steps involved in the 
administrative processes behind the legislative work of the 
Congress. In addition, it has developed avenues for 
surprisingly productive discussion between legislative branch 
agencies and the House and Senate offices on the needs for 
various procedures, systems and reporting requirements.
    I am pleased to report that over the last year various 
evaluations on the needs of the House have been conducted and 
further efforts to design and better diagram our needs is well 
under way. This multi-agency effort is progressing at or 
slightly behind the time lines originally proposed to the 
subcommittee 2 years ago. However, I remain hopeful that it can 
be completed within the next 3 years.
    Although progress may seem slow, there are several notable 
accomplishments to which we can point, most notably in 
electronic document use and public dissemination of electronic 
information. Working with the staff of the Committee on House 
Oversight, my office developed programs to assist committees in 
preparing and posting electronic versions of hearings and 
hearing transcripts through the Thomas system used on the 
Clerk's computers. Only hearing information submitted by the 
committees and specifically approved by the chairman is posted.
    Since May of 1997, when this service first became 
available, over 400 hearings have been processed for review and 
have been posted by my office.

                         floor vote information

    Another highlight is the processing and posting of House 
floor vote information through the Thomas system. My staff, 
with the approval of the Committee on House Oversight and the 
Speaker's Office, has developed a procedure to post House votes 
on the Internet the same day they occur.
    Also, last June, we established the Clerk's home page as a 
vehicle for providing more information electronically rather 
than relying solely on paper copies. Electronic documents 
compiled and printed by the Office of the Clerk are carried 
there and updated on the first day of each month.
    Included in my nonpersonnel budget request, I have budgeted 
money to allow for further evaluation and improvement of the 
House floor systems, primarily the House voting machine and the 
main display panels which list each Member's name and vote.
    At the beginning of the 105th Congress, the House voting 
system was upgraded to a smart card system and updated software 
improvements were installed. At the beginning of this month, 
new summary panels were installed on the floor. This was the 
second significant phase of improvement to the system since I 
became Clerk.
    The final phase of this upgrade requires that we thoroughly 
evaluate the current Member listing display panel and options 
to update and improve it. This voting board is the last 
original piece of the 1973 system and its age is beginning to 
raise questions about its dependability. I have included 
$200,000 in the fiscal year 1999 funds to cover this evaluation 
and determine the potential cost of the replacement. If 
necessary, I plan to spread these costs over two fiscal years.
    A primary objective is that none of these changes affect 
the physical appearance of the Chamber and work within the 
existing physical configuration there.

                           House VOting Cards

    On a personal note, Mr. Serrano, you raised the question 
last year regarding House voting cards and their reliability. 
Most important, you raised concerns about the voting cards in 
the 104th Congress being frayed easily and needing to be 
replaced regularly.
    With the improvements implemented with the new voting 
cards, the number of damaged cards dropped from 328 in 1996 to 
16 in 1997. So that is a 95 percent reduction, a good number 
for us.
    A completely different yet equally important program for 
the Congress is the evaluation and potential management 
improvements in the House Page Program. As you are aware, this 
program is also under my purview. I rely on the input of the 
House Page Board to assist in developing the policy for the 
program and to provide our pages with direct access to Members 
and to the legislative process.
    Over the last several weeks, we have been working to 
complete an evaluation of the program, its strengths, goals, 
and areas for improvement. The program includes a review of the 
work program, the school and dormitory. Upon completion of the 
review, I will be working with the House Page Board and others 
to see that all options for improvement and modifications are 
fully considered.

                      Legislative Resource Center

    Finally, over the last few months, great interest has 
developed regarding the opening and further reorganization of 
the Legislative Resource Center. The center has proven to be an 
important and valued addition to the House. The center combined 
the activities of four former offices: Records & Registration, 
the House Historian, House Librarian, House Document Room; has 
increased services via electronic systems and resulted in a 
significant reduction in personnel and costs.
    While some have criticized the resulting reductions in 
personnel, it has been and remains my intention to maintain and 
improve services, but to also cut costs when possible. This has 
been true in the LRC and all other offices under my purview.
    As a final note, my office has assumed the management of a 
significant number of vacant congressional offices this year. 
During the first session of the 105th Congress, we have had to 
manage six offices and more than 60 staff. While this is always 
a challenge, I acknowledge both the efforts of my office and, 
more importantly, the staffers in those offices working to make 
the work of the Congress go forward for the people of those 
districts. It is always my hope that no such vacancies occur 
for any reason, but they are a reality and one that I am always 
prepared to undertake with the best interests of the 
institution in mind.
    Once again, I appreciate having this brief opportunity to 
appear before your subcommittee, and I appreciate the support 
you and the Committee on House Oversight have provided over the 
last year and look forward to working with you in 1998. If you 
have any questions, I am obviously prepared to respond.
    [The information follows:]

[Pages 38 - 44--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you for your testimony. I do have a couple 
of questions, and then I will give the other Members an 
opportunity to ask, too.
    Ms. Carle. Okay.
    Mr. Walsh. I have a question that I would like to submit 
for the record.
    [A question from Chairman Walsh and response follow:]

    Question. How much is in your budget request for the 
Document Management System?
    Response. Included in the Clerk's FY99 request is $1.5 
million for the Document Management Systems further 
development, the same amount as FY98.

                     Document Management Initiative

    Mr. Walsh. Last year, we provided a million and a half to 
begin a document management initiative. Could you tell us how 
this is working out so far and how it has been met by Members 
and their offices?
    Ms. Carle. Well, a lot of the work so far is work you don't 
see, but is to build the framework for the final product. What 
we did is what you directed us to do, it was to go off and work 
with legislative branch agencies and the Senate to ensure that 
we all agreed to having a common standard computer language. We 
contracted with a company called the Mulberry Group and came to 
that common agreement, which was a feat. And now we are to the 
second part of it, which is building the SGML structure and 
architecture.
    Right now we have a series of meetings going on at the 
staff level between various affected parties, committee staff, 
Clerk staff and the Senate staff. The objective is to identify 
and set the standards for the production of bills and 
resolutions, and then the next step is going to be committee 
reports and the Congressional Record. On one level the process 
is very tedious, but it has to be done the right way or the 
whole structure won't stand.
    We also have an RFI, a request for information, out that is 
intended is to fully identify technical and software 
requirements for the House document management system the 
needed computer equipment, the capabilities, the capacity and 
projected costs for procurement. Currently we have distributed 
the RFI to 15 vendors, and we anticipate final contract within 
the next 2 months.
    And so the next steps are creation of additional contracts 
for the actual development of the workflow software, and then 
the procurement of equipment for the system.
    Mr. Walsh. That's moving along?
    Ms. Carle. Yes.
    Mr. Walsh. On the RFI--once you have decided on a 
contractor, how long would you say before----
    Ms. Carle. I think, again, it's according to the 
Procurement Office and the GSA-approved contractors, but we are 
thinking within the next 2 months we should be to the next 
phase.
    Now, I think that the initial negotiation was time-
consuming but worth it, because now that we are to a common 
place, things should be able to move along pretty well. And, we 
we will be pretty close to the time lines we suggested at the 
beginning.

                 Lindy Boggs Congressional Reading Room

    Mr. Walsh. Okay. I would also like to ask you to briefly 
discuss the Lindy Boggs Congressional Reading Room. We toured 
that a month or so ago, and there was a little concern about 
the availability of funds because of some of the things that 
you ran into, because of the historic significance of the room. 
Could you give us a little idea where that is now?
    Ms. Carle. First of all, I have to thank you because you 
got things up and on their way again. Initially, the reason 
that we were going into the room at all was to bring the 
restroom facilities up to ADA compliance and a couple of the 
other areas. The room hadn't been upgraded for a number of 
years, close to 20 years, and so it is rather shabby around the 
edges and the elected women use it a lot.
    When we got into the room there were other issues that seem 
to come up with an old building, that include asbestos and lead 
paint. Before you knew it, it kind of took on a life of its 
own. So, fortunately, when you took a tour, you had a better 
sense of that than I did.
    Mr. Walsh. Well, for the record, I guess, I had had the 
opportunity to travel with the Speaker. We went on to 
Congressman Bono's funeral and I mentioned the problem that 
they may not have the funds available because of the additional 
expenses, and he said, find the money.
    Ms. Carle. That's great.
    Mr. Walsh. So that was resolved very quickly that day.
    Ms. Carle. It is amazing how that works.
    Mr. Walsh. Your office has been just terrific.
    Ms. Carle. It is going to be a very nice space. As I said, 
the women Members need it and use it. So I will be real pleased 
when we are finished with the project.
    Mr. Walsh. Great. Thank you.
    Anyone else, questions?
    Congressman Serrano.

                       reorganization of the lrc

    Mr. Serrano. Yes. Thank you.
    First of all, let me thank you for the new voting cards. I 
was the king of the frayed cards, but I still have the same one 
that was issued this last time. So these did not fall apart 
around the edges.
    Not an issue that's nice to touch on, but I guess you know 
that a flap has been reported in the press about the 
reorganization of the Legislative Resource Center and, as some 
people have put it, some ``abrupt dismissals'' that took place 
there. Some accusations and allegations have been made that the 
firings were--that the dismissals came down heavy on ethnic and 
racial minority staff, and I think it is something we should 
address and deal with before it becomes an issue bigger than it 
is now.
    Mr. Hoyer and Mr. Payne have been very clear and forthright 
on this issue.
    I would like to give you a couple of these thoughts, and 
you can speak to any or all of them, about the reorganization: 
why was it necessary, other than the obvious reasons; how were 
these folks dismissed; why not attrition or vacancies?
    And then in 1996, we let go from your department some 
folks, and now in today's Roll Call there is an ad asking, as 
we understand it, to fill those positions or similar positions, 
and we would like to know if those folks, the ones who were 
dismissed earlier, were advised of these vacancies. And in 
general how do we address the fact that there is a growing 
feeling on the part of some people in the media and of many 
people on my side of the aisle that, one, people were treated 
according to party affiliation, party philosophy, and two, 
there was disregard for the small, already small, number of 
ethnic and racial minorities.
    There was talk about the only Jewish member of the 
department let go and 50 percent of all the African Americans 
let go. There was no mention of any Hispanics let go, but that 
could be because there were none. But that's another issue.
    So I would just like you to comment in general about it.
    Ms. Carle. Well, the reorganizational issues of the 
Resource Center, I first wish to speak to the abrupt part. It 
isn't new. We have been in the process of this reorganization 
since I got here, and we had the initial decision to combine 
the offices, and then we had the physical move to the new 
space. I could have made all of those decisions when we were 
moving to the new space, but quite frankly I did not want to 
move in a precipitous fashion. And I wanted all of those people 
to be in the same place for awhile to basically figure out how 
many people does it take to run the front counter, and how many 
people does it take to man the phones, we didn't really have a 
good sense of that in the beginning. While I had sort of rough 
cuts in my mind, until people were working day to day in that 
environment, we really didn't want to get ahead of ourselves.
    We spent a year, and some of it we did manage through 
attrition. Of the 17 positions that were eliminated, 11 of them 
were vacant positions, and we have made a conscious decision 
not to fill those. But you can't do all of your management 
decisions based on attrition, and so, unfortunately, there were 
some people who ended up on the list of positions that were 
being eliminated.
    You know, all I can say is that we didn't violate law or 
principle on how the process worked. And I think, you know, in 
terms of the media piece, it is rather reckless to suggest 
something so hateful that would have been the intention within 
the Office of the Clerk and me personally. And it wasn't.
    But, you know, I have been on the receiving end of 
reorganization and new administrations, and you can say all of 
those things, but when it is said and done, if you are the one 
person who is affected, it doesn't help you a whole lot that 
people are sympathetic to it or understanding of it because you 
are still the one without a job.
    We always try to place people, when we know we are going to 
go through reorganization, and we have gone through a number of 
other offices, not as dramatically as this one because this one 
was the combining of so many of our offices. But we always try 
to find other opportunities if we have them.
    The whole shop was reorganized, and the remaining people 
were all people who already worked there. We could have done a 
reorganization and start completely over, and we didn't choose 
to do that.
    Mr. Serrano. Well, Ms. Carle, you are not going to get any 
arguments from anyone here about the way the press treats all 
of us, and you have that in your favor in this argument, but 
every so often they stumble upon something, whether they like 
it or not. And how do you address the fact that there are 
members, not quoted by name, but members of the current staff, 
who feel that there is a systematic effort to isolate and 
intimidate those who do not fit a political mold?
    Now, whether that's true or not, we in this profession, and 
certainly anyone who is related to us in any way, shape or 
form, when these kinds of things begin to float around, we have 
to address them. If you let them go, they get bigger.
    I am giving you the benefit of the doubt that this is not 
going on, but this is being said and this is being felt, and to 
simply state that this is not happening is really not enough. 
We have to somehow get to the bottom of why there are people 
who were not dismissed who feel that there is something going 
on; why House aides who have been fired claim that it was for 
political reasons.
    And how do we deal with the fact that the Majority, when it 
took over, made a very bold statement and a very important 
statement about the fact that we would professionalize the 
place without regard to political philosophy?
    And I will be honest with you, once my side of the aisle 
got over the initial pain of losing the Majority, which is very 
normal, and any Member of the Minority will tell you that is 
normal, we applauded the fact that we were going in that 
direction, and now we seem to find that we are not going in 
that direction at all.
    So my last comment to you on this is whether we like it or 
not, we have a problem. We have people who feel that there is a 
racial mix in this, that there is a political mix, and that 
there is heavy-handedness. We have to deal with that. I am 
asking you, how do we deal with that, other than to do what we 
all are guilty of doing at times, which is, state ``that is not 
true and I don't want to talk about it''?
    Ms. Carle. You know, I am a rather moderate personality and 
I think that shows up in the way I manage things, too. You look 
at the overall Offices of the Clerk, I am not sure by 
percentage, but is it 80 percent are people who--it is a 
sizable percentage. I mean, there was nothing in my plan in 
terms of reorganization of the Offices of the Clerk to 
eliminate everyone who had worked here before and replace them 
with someone else. You know, I just don't work that way. I am 
not that kind of a person.
    Mr. Walsh. Can I interrupt for a second?
    You said 80 percent. You didn't finish that statement.
    Ms. Carle. You look at the numbers within the LRC, 80 
percent of the people who work there are people who worked 
there when I got here.
    And I appreciate what Mr. Serrano is saying, and all I can 
bring to bear on it is the good news and the bad news. If you 
are a highly partisan person. The good news from my perspective 
is that the Offices of the Clerk, your partisan credentials 
don't really fit. They don't matter.
    It is like this official reporter, can she use the court 
reporting equipment or not; if she has an ``R'' or a ``D'' 
after her nameis of no consequence. And certainly, I am sure we 
have hired people who are Republicans. I am not suggesting that we 
haven't. But there is no great plan. The plan is that, when we have a 
vacancy, to hire someone who is qualified for the job, and when we have 
staff, incumbent staff, that we cross-train or retrain or move to a 
different shop when we can.
    Mr. Serrano. Let me just close with this, because, Jim, I 
don't want to beat this subject to death, but it is important, 
I believe.
    First of all, you are right, there are many departments, if 
not all, that service us, where ``R'' and ``D'' and 
independents and liberals is not important. I certainly feel 
very safe knowing that the Sergeant at Arms will protect meself 
and my family in case of a problem; so will the Capitol Police. 
I certainly don't have a problem going to the Attending 
Physician and wondering if he is going to give me the wrong 
medicine because I am a liberal Democrat, although I am sure 
some people in the country would like to do that.
    Mr. Walsh. There is no cure for that.
    Mr. Serrano. That's right. Thank God for that. It may 
spread again, though.
    But here is what I am asking you to do: At the expense of 
going out of line here, the Chairman and I have the 
responsibility of making sure that these issues which are in-
house are kept at a minimum debate, and you could help me by 
staying in touch on this issue and making sure that we explain 
it for what it is, if it is what you say it is; and if it isn't 
exactly what you think it is, then we can fix it. I am sure we 
can fix it.
    There are qualified people all over the country who would 
like to work on Capitol Hill when an opening occurs. And if you 
do that, you will make our life easier, and then we make your 
life easier because this is a Committee that works very closely 
with the employees of the House. There are other committees, if 
you really notice, that work and set policy, and somehow it 
touches someone, but this Committee does work very closely with 
people who labor here together, and, therefore, it is in our 
best interest that this gets settled, because I know these 
issues. Trust me, the part of politics I know well is how these 
issues grow, and this one looks like it can explode into a 
serious one unless we deal with it early.
    Ms. Carle. I appreciate that. I am more than glad to work 
with you on it.
    [Questions from Mr. Serrano and responses follow:]

    Question. Can you provide a quick review of the purpose 
behind the comprehensive Legislative Resource Center 
reorganization plan?
    Response. As I outlined during my FY 96, FY 97 and FY 98 
testimony and again this year before this subcommittee, I have 
had a strong interest in combining various service and 
administrative functions under my purview. The objectives of 
this effort were to improve services, centralize locations and 
reduce overall cost to the House. Generally, the creation of 
the Legislative Resource Center was the result of combining 
four separate offices (Records & Registration, Historian, the 
House Library and the House Document Room) into a single 
office. This merging of offices and functions has allowed the 
staffing levels to be reduce from 69 to 26, with an estimated 
annual salary savings of more than $1.6 million.
    Question. I share Congressman Payne's concerns, as 
expressed in the January 28 issue of The Hill about the House's 
compliance with labor laws when ``close to 75% of African 
American workers have been terminated [from LRC] since 1994''. 
In the spirit of saving time, I would ask that you respond in 
writing to each of these concerns outlined in the recent 
article.
    Response. I simply cannot comment on issues relative to 
specific individuals. However, I appreciate the opportunity to 
generally address many inaccuracies and innuendo raised over 
the last few weeks.
    The justification of reducing staff in the Legislative 
Resource Center was based upon my management and business 
determination on the facility's staffing needs, issues relative 
to service and an overall effort to reduce costs. In early 
January, an additional 17 authorized positions were eliminated 
as part of a further re-organization, 11 positions were vacant, 
vacancies having occurred through attrition and six were filled 
positions. The re-organization resulted in reducing the 
staffing levels from 43 to 26 authorized positions.
    As the employing authority, I am keenly aware of the legal 
and ethical requirements I face regarding discrimination on the 
basis of race, color, religion, sex, age, disability and 
national origin. As well, I understand the further requirements 
of the Congressional Accountability Act. I am confident that my 
determinations are legally and ethically within these 
considerations. However, employees under the Congressional 
Accountability Act have the right to have such matters legally 
reviewed.
    Finally, let me state that several points raised within the 
news accounts are grossly inaccurate. First, the six released 
employees were each met with separately by my Deputy and 
Assistant for personnel issues. Each dismissed employee was 
notified of the situation, granted 30 days of administrative 
leave and encouraged to work with my immediate office to 
relocate to other employment opportunities. As well, House 
placement services are available to such individuals. No armed 
guards were present or requested by management. As is the 
practice in handling separating employee's checkout procedures, 
computer access was limited and office locks were changed at 
the end of the business day. However, managers worked extended 
hours so individuals were not inconvenienced and to ensure 
access to personal items. In addition, employees have been 
informed that any personal computer files that they wish to 
retrieve will be made available to them. As I stated 
previously, no political agenda was pursued in this 
reorganization and no form of discrimination occurred.

                          Employment Policies

    Mr. Walsh. Let me, if I could, just follow up real quick 
because I think this is fairly serious, that there would be any 
hint that there was bias in hiring or firing, politically or in 
terms of ethnicity or gender or whatever. I can't believe that 
there is, but let me just ask a question: Do you ask 
individuals who are applying for a job whether they are 
Republican or Democrat?
    Ms. Carle. No.
    Mr. Walsh. Do you ask that that be part of their resume 
when they present it to you?
    Ms. Carle. No. I mean, sometimes it is, obviously, but, no, 
that is not something we ask.
    Mr. Walsh. It is not a condition of employment?
    Ms. Carle. No, it is absolutely not a condition of 
employment.
    Mr. Walsh. Is it important to you to know whether an 
individual is Republican or Democrat?
    Ms. Carle. No.
    Mr. Walsh. Do you feel that the hiring practices of your 
office are in compliance with all the Federal guidelines that 
we all have to follow in hiring and firing?
    Ms. Carle. Yes, I know they are. We are quite intimately 
related to the legal staff here in the House. We are very 
careful.
    Mr. Walsh. Obviously, the press can report what they will, 
and there is nothing we can do about that, but your feeling is 
that you are quite comfortable that the decisions you are 
making are proper?
    Ms. Carle. I am, I am. But I also recognize Mr. Serrano's 
point that one doesn't want even the aura of discrimination.
    Mr. Walsh. Sure.
    Ms. Carle [continuing]. Around hiring.
    Mr. Serrano. There is, Mr. Chairman, the possibility 
always, with all due respect to the Clerk, for anyone who heads 
a department, that some hiring is done, as on many occasions in 
our offices, through someone's recommendation. If someone is 
recommending only people with a certain agenda in mind, then, 
yes, it is possible that you have a department head doing 
exactly what they are supposed to do, but what is coming to 
them has another agenda in mind.
    Mr. Walsh. Mr. Latham.
    Mr. Latham. Do you ask about religion?
    Ms. Carle. No.
    Mr. Latham. Obviously you wouldn't.
    Now, I think it is probably an inherent concern, especially 
if you are trying to downsize or make that type of change as to 
who is going to not be there anymore, and it may be perceptions 
sometimes don't fit with reality. But it is something obviously 
that perception is important, too.
    But I really don't have any question other than to say that 
I think we share the concern. I really think, you have been 
through a very difficult time, and it is hard to do these 
things, and, you know, being an employer myself in another 
life, you have people and it is one of the hardest things you 
have to do, but you have people whose feelings are hurt or 
whatever after the fact, and that is only natural. So I have 
empathy for you, and also I think that we need to be sensitive 
to the perception.
    Ms. Carle. Okay.
    Mr. Serrano. Mr. Chairman, can I ask a more fun question?
    Mr. Walsh. Certainly.
    Mr. Serrano. I don't want to leave you, you know, under 
that.
    Mr. Latham. Is this about Frank Sinatra? I am sorry, I 
should have never said that.
    Mr. Serrano. I told the Chairman and his three children of 
your usual outburst about Mr. Sinatra. They will be calling you 
later to discuss with you his music catalog.

                         hir mainframe computer

    Mr. Serrano. The HIR mainframe computer is currently the 
one that's being used. What will happen to your computer 
systems when HIR moves off this technology? I understand there 
are going to be some changes. What does that do?
    Ms. Carle. We have been working with House Oversight and 
also the HIR people about those Clerk functions that need to be 
replicated on some other system and those that have been 
overcome by new technology and we are already doing our work 
somewhere else already, and tandem with that the year 2000 
issues and some other issues.
    And I feel confident right now that Clerk functions are 
being handled and will be able to be handled. We have a couple 
of them we are still figuring out the right way to do it, but 
we are working very closely with them.
    Mr. Serrano. Very quickly, in general terms, I know you 
mentioned, do you feel that we are moving quickly on continuing 
to bring your department and the whole House into this age--
that we all claim was here 10 years ago, but we are now trying 
to catch up a little bit?
    Ms. Carle. I think we are moving at a good pace. Quickly 
might be optimistic, but I think we are getting pretty close to 
meeting our time lines, yes.
    Mr. Serrano. Thank you.
    Mr. Walsh. Thank you.

                     office of the sergeant at arms

    Mr. Eagen. Mr. Chairman, referring to pages 59 through 60 
of the Subcommittee Print for salaries and expenses, for the 
Sergeant at Arms, $3,611,000. I would like to submit the 
balance of page 21 for record, and I would like to introduce 
the Honorable Wilson Livingood, Sergeant at Arms for the House 
of Representatives.
    [The information follows:]

[Page 53--The official Committee record contains additional material here.]


    Mr. Walsh. Welcome, Bill.
    Mr. Livingood. Thank you, Mr. Chairman.
    Mr. Walsh. Please present your statement. Feel free to 
summarize.
    Mr. Livingood. Good morning, Mr. Chairman, Mr. Serrano, Mr. 
Latham. It is a pleasure to be here this morning to discuss the 
fiscal year 1999 budget request for the Office of the Sergeant 
at Arms.
    I would like to begin by expressing my appreciation to the 
members of the committee for your support this last year and 
actually every year that I have been here. As you know, my 
office is constantly striving to ensure that the safety and 
security of all Members of Congress, their staff, visiting 
world leaders and the general public is maintained. However, 
achieving this security, as I have said before, is unique in 
that we must balance the security goals with the public needs 
and demands for access to the Capitol and to their 
Representatives. I am pleased to report that, in my opinion, we 
have been very successful in achieving this balance.

                   fiscal year 1999 budget submission

    Currently, in my office, there are 82 FTEs as authorized. 
The total fiscal year 1999 budget request, as Mr. Eagen said, 
is $3,611,000. This is an increase of 1.32 percent from the 
total fiscal year 1998 budget. This small increase is due to 
cost of living adjustments and personnel expenses, offset by a 
nearly 25 percent decrease in nonpersonnel expenses.
    The nonpersonnel costs for fiscal year 1999 are estimated 
to be $308,000. The decrease of $100,000 from fiscal year 1998 
nonpersonnel expenses is largely due to the fact that many of 
our expenses are cyclical, occurring only in preparation for 
the first session of each Congress, such as identification 
badges for congressional staff, license plates, and pins, for 
Members, etc.
    I am requesting $3,303,000 for personnel expenses, an 
increase of $147,000 from fiscal year 1998. This increase is 
based on COLA estimates, longevities, and merit increases. I 
have no requests for new positions or reclassifications.
    I am proud to say that since I came aboard as Sergeant of 
Arms, each year I have been able to trim our office budget. In 
fact, the total budget request for fiscal year 1999 is less 
than our fiscal year 1997 budget.
    I would like to thank the CAO and the Office of Finance for 
their assistance with our budget preparation.
    I appreciate the privilege of appearing before the 
committee and assure you of my desire to cooperate and work 
with you on all matters of mutual interest. It is my goal to 
provide quality support services to the House of 
Representatives while remaining fiscally responsible.
    I have submitted a more detailed statement for the record 
and will continue to keep the committee informed of my 
activities. I will be happy to answer any questions that you 
may have.
    [The information follows:]

[Pages 55 - 56--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much.
    Your budget ought to be a model for the entire legislative 
branch, up just a little over 1 percent. We will be hearing the 
Capitol Police budget at a later time, and we will have more 
questions on that budget for you then. That will be next week, 
I believe.
    Mr. Livingood. Yes, sir.
    Mr. Walsh. And there are some security issues there that we 
may have to take special measures to deal with. But at this 
time I have no further questions.
    Mr. Serrano.

                    EMERGENCY EVACUATION PROCEDURES

    Mr. Serrano. I did have a question. But you just reminded 
us that security issues may have to be discussed somewhere 
else. In your statement, you do speak about emergency 
evacuation. So stop me if I am going over.
    Mr. Livingood. I will, sir.
    Mr. Serrano. I am just interested in what training has been 
available to Members' offices to deal with this issue.
    Mr. Livingood. We have started, as you are aware, the first 
evacuations from the Capitol and House office buildings and 
have had our first fire drills, starting with the page dorms, 
and now we have had it in the Capitol, for the first time ever. 
We have distributed a fire evacuation plan, an evacuation plan 
which could be for anything, to every Member's office. We will 
be revising the plan as time goes on to make sure it is 
current.
    We are training the Capitol Police in the area of emergency 
evacuation. They have the responsibility in every building, for 
stairwells, and all exits. We are training the Guide Service so 
they can assist in evacuating tours, and people visiting the 
Capitol. We are training people in my office, meaning the 
Chamber security, my immediate office, and parking security, to 
help in all this. So we do an awful lot of training.
    Mr. Serrano. The first fire drill went well?
    Mr. Livingood. It went surprisingly well. We learned a few 
lessons that we have corrected, and, in fact, because of the 
training we had prior to that, it went very well. And we will 
have more.
    Mr. Serrano. On Members' office guidelines, you said they 
were sent out already?
    Mr. Livingood. Yes, sir. They were sent out about 6 months 
ago to every office. They were hand carried by the Capitol 
Police. And I know they were delivered because I received 
various informational calls. And if anybody does not have one, 
just call me and we will make sure that they have it 
immediately.
    Mr. Serrano. Thank you.
    Mr. Walsh. Mr. Latham.

                      EXPLANATION OF 1997 INCREASE

    Mr. Latham. I would just like, Mr. Chairman, to compliment 
you as far as trying to keep the request appropriate, I guess.
    One question, just historically: Why is there such an 
increase from 1996 to 1997? It is from $1.6 million to $3.8 
million the next year.
    Mr. Walsh. I will let the Sergeant at Arms explain that.
    Mr. Latham. I mean, this is just a question, I guess, just 
to see what the jump was, on 59.
    Mr. Livingood. That is when I first came. They took the 
Doorkeeper's Office and moved part of that to my office. So I 
inherited a substantial number of people, and it is salaries 
and equipment for them. It was combining part of the 
Doorkeeper's Office with the Sergeant at Arms Office.
    Mr. Latham. I assumed it had to be additional 
responsibilities or something.
    Mr. Livingood. And one area, garage attendants, had been 
under the Architect of the Capitol, and that was given to me by 
the committee, which has worked out well.
    If I may say one thing, I had little reservations about, as 
some of you know, taking the parking attendants and making them 
security. It has worked out magnificently. I am so proud of 
them and what they have done and achieved. I could not be 
happier with that decision.
    And I would just like to say, if I could, on Mr. Serrano's 
question on emergency evacuation, my thanks particularly to the 
cooperation we have had in this, all this evacuation and fire 
drills, et al., with the Senate Sergeant at Arms and also the 
Architect of the Capitol and the Physician's Office. We have 
never had a closer working relationship than we do today, and 
this has brought all of that together. We meet constantly once 
or twice a week, that often, and talk to each other almost 
every day. And never before has that been the case.
    [A question from Chairman Walsh and response follow:]

    Question. What is in the request for the Guide Service and 
Special Services?
    Response. In FY 1999, the total budget request for the 
Capitol Guide Service and Congressional Special Services Office 
is $2,195,000. This represents an increase of $204,000 over FY 
1998 appropriated funds. The majority of the increase is to 
cover inflationary costs in agency contributions, cost of 
living adjustments, and provision for adequate uniforms for 
employees. The Capitol Guide Service is also requesting $85,000 
for an additional three FTEs for FY 1999. These employees are 
needed to assist with the dramatic increase in visitation to 
the Capitol and to cover extended hours of operation during the 
peak visitor season (March through August). The Congressional 
Special Services Office is requesting an additional $10,000 to 
cover inflationary increase in the costs associated with 
providing sign language interpretation to Congressional offices 
and the public.

    Mr. Walsh. Anyone else?
    Thank you very much.
    Mr. Serrano. Thank you.
    Mr. Livingood. Thank you, sir.

                      chief administrative officer

    Mr. Walsh. Back to you, Jay.
    Mr. Eagen. Thank you, Mr. Chairman.
    Now referring to pages 61 through 62 of the subcommittee 
print, the fiscal year 1999 budget request contains total 
funding of $58,829,000 for the Office of the Chief 
Administrative Officer. I would like to include in the record 
pages 22 through 28.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 59 - 69--The official Committee record contains additional material here.]


                   fiscal year 1999 budget submission

    Mr. Eagen. Mr. Chairman, before I present the CAO budget, I 
would like to express a brief word of thanks to Mr. Jeff 
Trandahl, who is sitting in with us today. Jeff has returned to 
his position as Deputy Clerk of the House and served as the 
acting CAO prior to my appointment to the position. He was 
tremendously helpful to me personally in a transition period 
that was sometimes difficult, and I think he served the House 
very well, and I just want to note that for the record.
    Mr. Walsh. Well, that is now part of the record. And I will 
certainly associate myself with your remarks. He knew exactly 
what he wanted, and it was not your job. So I believe it has 
worked out very well for both of you. We are delighted to have 
Jeff with us this morning. And he did do a great job.
    Mr. Eagen. Mr. Chairman, members of the subcommittee, the 
Office of the Chief Administrative Officer was established at 
the beginning of the 104th Congress. Included as part of my 
statement is a detailed organizational chart with division 
listings of the CAO. Also included is a chart showing the 
fiscal year 1998 funding by division compared to the fiscal 
year 1999 requests.
    Simply, the organization consists of 6 divisions, 
overseeing 32 offices, more than 600 House personnel, and has 
oversight responsibilities for more than 200 contracts. The six 
divisions include the CAO immediate office, the Office of 
Finance, Human Resources, House Information Resources, Median 
Support Services, and finally the Office of Procurement and 
Purchasing.
    The mission of the CAO organization is to provide excellent 
administrative services to the U.S. House of Representatives. 
As a professional team, it is proactive and focused on the 
evolving needs of Members and concerns of the House community.
    We approached the fiscal year 1999 budget development 
process with four basic goals. First, our budget request must 
reflect the ability to proactively provide baseline services as 
well as new services to the Members and staff.
    Second, we would take a fresh look at the necessity and 
efficiency of each function, we would question the continued 
need for each major function, and we looked at alternative ways 
to the way we are delivering service, and we ensured ourselves 
that the end product was responsive to the House needs.
    Third, all senior managers would be a part of the process 
and, thus, support the end product.
    And, finally, we produced a final budget which was 
reflective of the overall funding challenges facing all of 
Government.
    For the future, as we look to the remainder of calendar 
year 1998 and look forward to fiscal year 1999, I have included 
in my formal statement five principles that I believe the CAO 
will focus on, division statements for the organization, and I 
will skip those now but include them for the record.
    As I mentioned, the total funding request for the CAO is 
$58,829,000. The increase, in comparison to fiscal year 1998, 
is driven primarily by two cyclical responsibilities carried 
within the CAO's budget. First is the more than $5 million net 
budget request for office equipment. This request, which is 
nearly 9 percent of the total budget, is for equipment costs 
incurred for the first session of the 106th Congress, 1999. The 
fiscal year 1998 funding for the same account is less than 
four-tenths of 1 percent due to the cyclical nature of these 
expenses. The budgetary effect of this ``saw tooth'' is 
presented in the chart that I would request be submitted for 
the record. And I have some copies to share with you.
    Second, the CAO's budget request contains funds to cover 
the estimated expenses from the congressional transition to the 
106th Congress. Simply put, these two items require funding for 
which there was little comparable fiscal year 1998 baseline 
expense. For point of comparison, the CAO budget for fiscal 
year 1997 was $60,169,000. The budget presented today is a 2.2 
percent decrease from the fiscal year 1997 budget as revised 2 
years ago.
    Our top funding priority in fiscal year 1999 is a 
collection of coordinated projects that respond to the Year 
2000 compliance challenge facing the House of Representatives. 
Frankly, the funding and resources required to properly address 
the Year 2000 challenge are a considerable limiting factor on 
projects the organization might pursue.

                        key technology products

    Among the key technology projects that the CAO will be 
undertaking prior to the year 2000 are a new human resources 
payroll system, a new inventory and fixed assets management 
system, revision of legislative information management system, 
the Clerk's system that Robin referred to, a central Year 2000 
project manager to coordinate House activities, and an 
information campaign to make Members' offices and committees 
aware of Year 2000 compliance needs.

                             payroll system

    This budget request includes a request of $2.5 million for 
the new human resources payroll system. Presently, the House 
has in place a contractor, Booz Allen, through the General 
Service Administration FEDSIM program, to conduct both a 
requirements study and a business process reengineering study. 
The results of these studies will be complete in the next few 
months.

                          mainframe migration

    In November 1995, the Committee on House Oversight adopted 
a resolution which called for House Information Resources to 
plan for the orderly elimination of its mainframe computer. 
This budget request assumes that this mainframe migration will 
occur. But the specific detail of that migration will be guided 
by the joint Inspector General/House Information Resources 
study directed by this subcommittee. The study will be 
concluded shortly.
    In addition, the new Associate Administrator of House 
Information Resources, Tim Campen, is conducting a strategic 
assessment in order to replace an update to HIR operations.
    With regard to the other major House technical system, our 
financial system, or Federal Financial System, FFS, funds are 
in this budget to continue the daily operations and to make 
required modifications to FFS. However, I believe the time is 
now at hand when the House should begin an assessment process 
to determine the long-term solution for its financial system 
needs.

                           postal operations

    More than 6 percent of this budget request is for the 
postal operations contract for the House. This contract is 
currently being recompeted, and we have planned for an increase 
in the monthly fee to accommodate service changes, such as 
relocation of the X-ray facility presently located in the Ford 
Building to the off-site P Street receiving location, as 
recommended by the Sergeant of Arms.
    The fiscal year 1999 budget request excludes amounts for 
merits or reclassification of positions. This does not mean 
there is a moratorium on these items, simply that they will be 
granted from budget savings as necessary. In addition, there is 
a moderate FTE reduction of nearly 3 percent of current 
approved levels.
    I realize this is simply a brief overview of operations of 
pending fiscal year 1999 funding requests. To better articulate 
the daily activities, responsibilities, and proposals before 
the Office of the Chief Administrative Officer, I have attached 
a brief outline of offices and operations. And I appreciate the 
time of the subcommittee and would be happy to answer any 
questions you may have.
    Mr. Walsh. Thank you, Jay.

                            year 2000 issues

    I have a number of questions I will submit for the record.
    [Questions from Chairman Walsh and responses follow:]

    Question. Jay, we have the material you supplied on your 
budget. What particular areas in the CAO's operation are you 
mostly focused on?
    Response. I'd like to provide a response that answers this 
question from three complementary perspectives: organizational, 
strategic and functional.
    Organizational: The creation of the CAO three years ago 
implemented some logical realignment of the boxes that make up 
the administrative services of the House. For the most part, 
that work is done. What still needs to be done is the 
establishment of complete policies and procedures to fit those 
organizational boxes. The old procedures don't work with the 
new boxes. Office Systems Management (OSM) is a good example. 
The approved equipment list was abolished, but OSM continues 
use of a computer inventory system based on old approved list 
codes. Data has to be entered twice, the new way for purchases 
and the old way for inventory. This is a huge waste of staff 
time and results in delays. This problem will likely be 
addressed through the fixed assets system replacement which is 
currently under way. A business process re-engineering element 
is part of the replacement program. In sum, for the next year I 
expect the CAO will concentrate on a wide range of procedural 
adjustments of this nature in order to match the organizational 
structure established in 1995.
    Strategic: My written testimony refers to five over-arching 
visions. Let me stress two in response to this question about 
priorities. First, excellent Member and staff service. From the 
perspective of a House member or staff person, it remains very 
confusing as to who provides what service and why you have to 
call several offices to complete a task as simple as having a 
desk moved. The CAO and other House service providers (the 
Architect for example) have to coordinate our efforts to 
eliminate that confusion. Accomplishment of this goal will 
require cross-organizational coordination that has proven 
difficult to achieve and will require some ``cultural'' 
adjustments.
    A second principle among the five is professional renewal 
and revitalization. The CAO organization has two immediate 
personnel needs. First, senior staffing vacancies need to be 
filled to create stability. We're close to completing that 
task. Second, the CAO should develop a comprehensive internal 
training program that, as a first priority, focuses on 
improving management skills. The CAO has tremendously dedicated 
people. Most of the managers, however, are primarily ``doers.'' 
In other words, they are technically strong in their specialty 
field, but they have had little opportunity to broaden their 
team management and planning skills. The CAO needs them to be 
not only ``doers'' but also effective leaders of their teams.
    Functional: Three key functional areas require the CAO's 
attention for the balance of 1998 and into Fiscal Year 1999:
    (1) Finances: the CAO must assure that the financial 
responsibilities of the House are met in the most effective and 
timely manner possible. For example, the House should produce 
its own financial statements and our long-range goal has to be 
an unqualified financial audit opinion from the House Inspector 
General.
    (2) Year 2000 Compliance: While a number of positive steps 
have been taken, including hiring of a Y2K project manager last 
September, this project requires constant focus by the CAO. 
Three key pieces to the puzzle will be confronted in the next 
three months: (a) the House human resources/payroll replacement 
project; (b) the fixed assets/inventory replacement project; 
and, (c) completion of a comprehensive plan for all other Y2K 
affected systems by March 31, 1998.
    (3) House Information Resources: HIR has been at a 
crossroads for several years. Mainframe or server based 
technology? Legacy self-developed software or commercial off 
the shelf solutions? Direction has been provided by the 
Committee on House Oversight on these questions, but it hasn't 
been followed consistently. Despite this, significant progress 
has been made with projects like the House e-mail system, an 
improved telephone/backbone infrastructure and web access for 
Members offices. The state of confusion has been arrested and a 
new sense of direction begun with the hiring of a new Associate 
Administrator. For the future, clarification is needed as to 
the role HIR will play for the House and the role technology 
will play in assisting legislative democracy. In this regard, 
we plan to draft a charter for HIR for the Members review and 
concurrently propose a more adaptable staffing structure that 
is able to respond to the ever-changing technology 
opportunities available to the House of Representatives.
    Question. The reimbursements to HIR are in significant 
decline. That is because you plan to phase out the use of the 
mainframe. Is the mainframe migration a ``fait accompli''?
    Response. The OIG's Mainframe Migration Options Study 
provides a conceptual strategy and cost-benefit analysis on the 
migration path for 8 House mission critical applications. HIR 
is currently reviewing the recommendations of the Office of 
Inspector General regarding mainframe migration. The results 
from our review will drive our planning efforts in this area; 
however, current technology trends and House user requirements 
indicate that a shift off of the mainframe to a client server 
architecture and web based tools will support HIR's move to a 
more flexible and responsive IT organization.
    Question. Where will GAO and CBO go to maintain their ADP 
outsourcing needs? We are particularly concerned that CBO is 
not left holding the bag. GAO is very capable of making a 
transition, but CBO is very small and relies on the larger 
administratively capable agencies for much of their support 
needs. Are you working with them to make sure this will be as 
painless as possible?
    Response. Over the past several months we have had meetings 
with CBO staff regarding the migration of CBO applications off 
the HIR mainframe computer. Because CBO staff lack the 
technical expertise to manage their migration off the 
mainframe, HIR stands ready to assist CBO in identifying a 
migration path and destination site that suits the specific 
needs of CBO. During our meetings with CBO staff, CBO has 
expressed a particular interest in piggybacking its mainframe 
migration with the migration of the Legislative Information 
Management System (LIMS). Again, HIR will provide technical 
assistance to CBO in accomplishing the physical migration of 
its system.

    Mr. Walsh. But let me just ask generally, this Year 2000 
issue, what physical changes or otherwise operational changes 
will Member offices see in anticipation of the year 2000, if 
any?
    Mr. Eagen. If I might, Mr. Chairman, let me start to talk 
about what I would characterize as three broad groupings of 
fiscal year 2000 challenges facing the House, and then maybe I 
can try to tie that into what that means for Members as we see 
it right now. And, clearly, it is an evolving picture.
    I think the first category that I would describe for you is 
major systems. I mentioned some of those in my testimony. What 
we are talking about here first is the payroll system. The 
Committee on House Oversight had directed that we undertake a 
replacement effort for the payroll system.
    In the case of the inventory system, or fixed asset system, 
we presently in the House have three systems. We have one for 
telephones; one for what I would characterize as business 
equipment, which would mean computers, fax machines, copiers; 
and then, finally, we have a third for furniture. All three of 
these are not Year 2000 compliant. And, again, the Committee on 
House Oversight directed that we undertake a replacement effort 
for these systems.
    We also have the Federal Financial System, which is 
outsourced, and that contractor will be responsible for Y2K 
fixing. The other major system is the Clerk's Legislative 
Information Management System, known as LIMS.
    In this case, the Committee on House Oversight directed 
that we would not undertake an immediate replacement but 
instead the Clerk will look at a replacement system geared 
towards the Year 2004. HIR instead will fix the code. Right 
now, we have contractors in place that are working with House 
Information Resources to rewrite all that code, and we are 
actually done with the initial rewriting and undertaking the 
testing phase to make sure the fixes have been achieved.
    The answer to the question, then, with those major systems 
as to how Members and staff will be impacted, in the case of 
payroll and inventory particularly, is dependent upon the 
requirement studies that are being conducted right now.
    The final piece of the requirement studies is business 
process reengineering. And what we will attempt to do is have 
the requirements merged with the culture of the House and 
figure out what is acceptable to the House community.
    For example, in the case of the payroll system, a key 
factor is that right now the House makes its payroll on a 
monthly basis. The Federal Government does it every 2 weeks. It 
has been a big cultural question as to whether the House could 
make that shift to a bimonthly payroll. The Department of 
Defense, I believe, is on a monthly payroll, but that is the 
only other branch of the Executive Government that is.
    Those questions are not answered. The requirement study 
needs to be done. And a comparison with the capabilities that 
are in there, whether it is outsourcing or a COTS solution, all 
needs to be evaluated, and will be undertaken over the next few 
months.

                        year 2000 ad hoc systems

    The second category of Y2K work that the House needs to pay 
attention to is what I would call ad hoc systems. For example, 
the Office of the Attending Physician has his own computer 
system; he keeps track of various kinds of records. That 
medical system is not Y2K compliant. We have developed an 
inventory that is in its first edition, as of this December, 
and when it is complete, it will list every system under the 
House, what its status is, and eventually what the plan is for 
the repair of that Y2K noncompliant system.
    The final category is Members and committees. Y2K does not 
only affect computers, it affects potentially anything that has 
a chip in it, which could be a copier or a fax machine.
    Mr. Walsh. Don't our vote cards now have a chip in them, 
although it is not being utilized for anything?
    Mr. Trandahl. They do, and they are Y2K compliant.
    Mr. Eagen. Thanks, Jeff.
    Mr. Serrano. They can also be traced to wherever you are.
    Mr. Eagen. In this case, I think we have two tasks in front 
of us. One is to work with the various vendors that supply 
equipment to Members' offices, to the committees, and to the 
House at large. We started a letter campaign that has been 
going on for several months saying, ``Are you, in fact, Y2K 
compliant? Which of your products are, and which are not?'' 
And, alternatively, or as a complement to that, more directly 
to work with the Members' offices to share that information so 
that, as they are making buying decisions, they focus the 
replacement efforts on equipment that needs to be replaced.
    For example, it is typical for Members' offices at the end 
of the calendar year to use funds that they may have available 
to buy a new computer system or copier. That happened just at 
the end of 1997.
    So we worked with the committee on House Oversight to send 
a ``Dear Colleague'' to all Members' offices suggesting that 
one of the questions that you want to ask before you buy any 
new equipment is, is it Y2K compliant? If it is not, do not buy 
it. So there is going to be some effect in terms of Members 
making sure that their staff are asking these questions and 
working with us to make sure that their systems are, in fact, 
compliant.
    There is some potential effect in terms of the mass 
operations of the House and in terms of these requirement 
studies that we are doing right now, and some decisions need to 
be made by this committee and the Committee on House Oversight 
as to how we want the House to function operationally.
    [A question from Mr. Serrano and initial response follow:]

    Question. Your statement refers to a Y2K project manager to 
coordinate House activities. Please expand on the activities of 
this position.
    Response. The Year 2000 project manager is responsible for 
management and coordination of Year 2000 issues within HIR, 
within the CAO organization, and the House. He is responsible 
for putting in place a Year 2000 methodology that represents 
best practices from private industry and Government, and for 
adapting that methodology to function effectively in the House 
of Representatives. He is also responsible for developing an 
overall plan to meet all CAO Year 2000 responsibilities. The 
plan will include schedules and resource requirements to 
accomplish the recommended solutions. He is also providing an 
overall template for project plans that will be used for the 
approximately 32 subprojects that account for the detailed work 
that is the majority of the Year 2000 work. He also represents 
the CAO with outside organizations that are meeting to identify 
and share lessons learned and best practices on Year 2000 
matters (e.g., the Chief Information Officers' subcommittee on 
Year 2000, an informal organization of Executive and 
Legislative Branch representatives that meet monthly on Year 
2000 issues; the Washington Area Year 2000 Group, an 
organization of public and private Year 2000 practitioners in 
the Washington DC area).

                           major expenditures

    Mr. Walsh. Do you anticipate any major expenditures that we 
could be faced with in the next year or two, all of a sudden we 
really are going to have to spend a lot of money to get us up 
to speed?
    Mr. Eagen. Well, I think for the most part the expenditures 
that we know of right now that are anticipated are in this 
fiscal year 1999 budget request.
    Mr. Walsh. So how many unanticipated expenses are there?
    Mr. Eagen. I cannot answer that question. We have this 
inventory already in hand. The next edition of it is due by the 
end of the first quarter of this calendar year. We are relying 
on this to be the basis of determining what we have to do and 
what we have to fix.
    Mr. Walsh. Well, obviously, you will need to look at that 
closely and let us know if there are any changes.
    [A question from Chairman Walsh and response follow:]

    Question. A large part of your increase is the equipment 
item. That isn't equipment for your office; it is the normal 
increase for new Members elected in the 1998 elections to 
outfit their offices with PC's, and so forth. You estimate a 
total expenditure of $48.7 million. How many offices have you 
assumed will require new equipment?
    Response. The $48.7 million is the projected total cost for 
all House expenses related to equipment purchases, maintenance, 
time & material repair, shipping, and all other miscellaneous 
costs. Of this amount, $28.5 million is the anticipated total 
for new purchases. We assume 70 offices will require new 
equipment.

                        mail delivery frequency

    The last question is--and I think it is a good one, too--
why do Members' offices receive a last mail daily at about 10 
p.m. and then a first mail at 8 a.m.?
    I mean, I am generally--and I am not bragging, I just do 
not have any other place to go--I am generally in my office at 
10 p.m. I do not know how many other offices are manned at 10 
p.m. But I do not read the mail at 10 p.m. Could they not be 
consolidated into one and garner some savings somewhere?
    Mr. Eagen. I think that is a possibility that we would be 
happy to explore. I believe the answer to that is, that is what 
the contract presently provides.
    Mr. Walsh. Maybe it would be a good idea to get some 
history on that as to why we are getting mail at 10 o'clock at 
night.
    Mr. Eagen. I would be happy to do that.
    [A question from Chairman Walsh and response follow:]

    Question. Why do Members' offices receive a last mail daily 
at about 10:00 P.M. and then a first mail at 8:00 A.M.? I do 
not read the mail at 10:00 P.M. Could they not be consolidated 
into one and garner some savings somewhere?
    Response. Savings would not be garnered if the 10:00 P.M. 
and next morning deliveries were consolidated. If a delivery 
were not made at 10 P.M., then the next day's 7:30 A.M. 
delivery would be so large that extra staffing and time would 
be needed to cope with the large amount of mail ready to be 
delivered to offices. Incoming and Inside mail is sorted 
continuously throughout the day. In the evening hours, the most 
crucial item to sort is Inside and Dear Colleague mail, which 
can take considerable space in a Member's mail box. When Inside 
Mail is completed then incoming USPS mail is sorted. The next 
morning, prior to 7:30 A.M., each Member receives at least one, 
if not two or three newspapers and more Dear Colleagues.

    Mr. Walsh. Mr. Serrano.
    Mr. Serrano. Thank you, Mr. Chairman.
    Mr. Walsh. Welcome, Mr. Fazio. How are you?
    Mr. Fazio. Good. Good seeing you.

                             hir questions

    Mr. Serrano. I would like to ask you a couple of questions 
and bunch them together on HIR. We in our office use their 
services, and we are always concerned about where they are 
heading. They appear to be moving away from information 
services and to information exchange, fax, e-mail services, and 
the like.
    First, would you describe the features of the new services? 
Does HIR have the appropriate hardware in place, and do they 
expect these services to impose new costs on use in offices?
    And, secondly, HIR's intentions about creation and 
maintenance of Members' Web pages, particularly charging for 
the services, what would the impact be if some offices do not 
have or cannot afford to hire from HIR or an outside vendor the 
necessary Webmaster capabilities?
    And, lastly, we are one of the offices that has been 
looking into setting up videoconferencing between the District 
office and this office here, and we know that there is only one 
person assigned to handling that, and we have gotten quite a 
bit of service from him. But I wonder, what is the future of 
HIR's involvement in this area of technology?
    Mr. Eagen. Let me see if I can remember all the questions 
and respond to them.

                            direction of hir

    In a big-picture way, I believe HIR is at a crossroads. And 
to use a Yogi Berra-ism, if you are at a crossroads, take it. I 
think that what has been going on in the big picture sense, is 
that there has been a crossroads for HIR and it has tried to 
walk a couple of different directions at the same time.
    Tim Campen, the director of House Information Resources, 
has only been with us since November 19th. In the intervening 
period before the departure of the previous director, we 
brought in KPMG Peat Marwick to do an assessment of House 
Information Resources. In fact, I have that document here 
today. It suggests, KPMG does, that a new model might better 
serve the House in the future. And, in some ways, that 
transition started before I came, and it is going to continue 
for the next year. It is going to have some ramifications in 
whether we maintain any kind of mainframe capability. The 
Committee on House Oversight, for example, has directed that a 
mainframe migration occur at House Information Resources. I 
alluded to that in my testimony. That is a significant 
transition.
    [A question from Chairman Walsh and response follow:]

    Question. The House Information Resources budget is under 
the CAO. What is in this budget for telephone instrument 
replacements? There was some considerable interest in that item 
last year. Give us an update on the replacement program.
    Response. Funds have not been requested in the FY '99 
budget for telephone instrument replacements due to budget 
priorities. However, the subcommittee did approve in the 
September 1997 reprogram $308,700 for new telephone handsets 
and their installation. Before the September 1997 reprogram, 
205 Member offices had been converted to the new telephone 
instruments. Since the project restarted in December as a 
result of the September 1997 reprogram, 27 additional Member 
offices have been converted to new telephones for a total of 
232 Member offices. It is estimated an additional 53 Member 
offices will be converted by April 1998 for a total of 285 
Member offices with new telephone instruments.

    In terms of the new services that have become a part of----
    Mr. Serrano. Excuse me. When you say ``significant,'' what 
effect does that have? You did not smile when you said that it 
was something that you were looking forward to.
    Mr. Eagen. It is not a matter that I am not looking forward 
to it, but it is a situation with a whole series 
ofuncertainties at this point. The reason I say that is because the 
joint study that is being undertaken by the Inspector General, in which 
HIR is participating, is not concluded. I view that as the first key 
step.
    That study, at the direction of this subcommittee, is 
supposed to produce a cost-benefit analysis as to how a 
mainframe migration should occur. Until we take that study as a 
base foundation and then build a plan, there is a lot of 
uncertainty.

                          new services of hir

    In terms of new services--and these are a result of the 
cyber-Congress type approach to HIR--I think the two biggest 
things, one you alluded to that the House has seen, is the e-
mail system and, secondly, the Web interface.
    Right now, we have 345 Member offices that have Websites. 
House Information Resources developed, I believe, 200 of those 
themselves. We maintain approximately 175 of those through the 
direct support of House Information Resources.
    In the case of Exchange, the e-mail system, at the time 
that Microsoft installed it, my understanding is, it was the 
largest central e-mail installation that they had done of that 
particular application. Last year, at the end of the fiscal 
year, the House purchased a new license that will give us the 
flexibility to upgrade to the next level of e-mail software 
called Outlook. That will take us into the Year 2000, and we 
will be able to now transition the House from what is solely an 
e-mail client and has a limited scheduling capability to 
something that is built in with more sophisticated scheduling 
and tasking. I think it is the opportunity in terms of the goal 
of achieving the paperless office to really take the House, and 
it could mean significant changes for the way Members run their 
office, in a positive direction.
    [A question from Mr. Serrano and response follow:]

    Question. Roll Call reported on Cola Wars over the new food 
service contractor's pricing policies. A major problem for HIR 
was chain e-mailing of protest messages. It does'nt sound as if 
HIR's effort to stop chain e-mails was very effective. How did 
the chain e-mail effect the House computers and how can HIR 
more effectively limit chain e-mails?
    Response: Chain e-mail or ``spam'' e-mails are difficult to 
proactively manage without invading the privacy of House 
Members and staff. These types of e-mail can originate 
internally from House staff or from external individuals or 
organizations.
    The ``soda pop'' e-mail that you are referring to 
originated from a internal House staffer, sending it to a large 
number of recipients. These recipients used the ``reply all'' 
feature to express their comments to those who received the 
original message, then those who received those comments used 
the ``reply all'' feature to express comments to those comments 
and so on, causing a huge spike in message traffic started by 
this one e-mail. The impact of this on the computers which run 
the House Messaging System was an extreme degredation of 
service. This huge spike in traffic caused all House Members 
and staff to experience a large slow down in e-mail and 
scheduling performance until these messages were processed by 
the House Messaging System, and delivered to their destination.
    Once these types of e-mails get into the system they are 
very difficult to eradicate because they are mixed in with 
``real business'' e-mail. Thus leaving HIR with the only option 
to have the computer systems process these as expeditiously as 
possible.
    The Committee on House Oversight responded to this problem 
by sending out a reminder that there is an approved Information 
Systems usage policy in effect, reiterating appropriate use of 
House systems.
    HIR currently has a defined method used to resolve e-mail 
attacks from outside sources. This is a process by which the 
Messaging Systems support staff works with the HIR Security 
staff and Associate Administrator to document the impact and 
initiate, by physically blocking, the delivery of e-mail from 
that individual or organization in response to the negative 
impact their e-mails may have on the House Messaging System.

                       videoconference techology

    On videoconferencing, I believe we have installed 
videoconferencing or assisted in installing about 15 offices in 
the House. We also have a central videoconferencing facility in 
the recording studio that Members can book for their use.
    I think this question was raised very specifically last 
year at last year's hearing, as well. At the time, the Director 
of HIR described what was needed in terms of having a videocam 
and so forth in Members' offices. It is still an expensive 
undertaking, and I think that there are still questions about 
as to what kind of investment will be required or appropriate 
for the entire House to move in that direction.

                             future of hir

    Mr. Serrano. I certainly share your concerns. And I can 
tell by your answer that, obviously, there are a lot of things 
that are not clear yet.
    My initial concern, my overriding concern, is that this 
department was very instrumental in bringing us to the point 
where we are now, and we have made quite a bit of progress 
going from Web pages to the videoconferencing to the cyber-
Congress. And now, obviously, we are on the brink of expanding, 
really getting to the point where we think we should be, which 
changes every day with some new invention in this field, some 
new knowledge. And I am just wondering, if in the desires to 
see how cost-effective everything that is going on at HIR is 
there might not be also a question as to the necessity of those 
services provided to the Members.
    I think Member offices and Members have to know, with much 
anticipation, if the eventual plan may be to move HIR away from 
servicing Members, because up to now Members have been very 
dependent on that department, extremely dependent. That 
department has brought us into this era, this time and place, 
and now, if we are going to have to move and go out there, and 
then if we do, there should be something in place to assist 
Member offices. And we are dealing with a thousand vendors 
offering a million services and, in all honesty, we, nor 
anyone, except perhaps Bill Gates, have any understanding about 
what it is they are talking about in the first place.
    Mr. Eagen. I do not anticipate that HIR itself is going to 
be out of the service business. I think service is what the CAO 
is all about.
    I think it is confusing for offices, and I have experienced 
it as an AA and as a staff director, and now as CAO, that you 
have what is supposed to be a closely coordinated layering of 
service capabilities for Members' offices. You have vendors; 
you have technical service representatives that are part of 
HIR; and then, hopefully, you have someone with some amalgam of 
computer capability in the office themselves, whether it is a 
Novell engineer-systems administrator or somebody that was a 
political science major that took the right courses.
    It is different, office by office by office. And I think 
one thing that we have come to recognize is that we are going 
to have to somehow perhaps establish some standards of how 
those things are going to interlink so that it is not confusing 
to Members offices. It is confusing to me.
    Mr. Serrano. It is sometimes confusing to me.
    Well, thank you very much.
    [A question from Mr. Serrano and response follow:]

    Question. Without a mainframe, will HIR continue to be able 
to provide the National Change of Address (NCOA) service to 
House offices?
    Response. No, HIR will not be able to provide the NCOA 
services to House offices. These services will need to be 
provided elsewhere.

    Mr. Walsh. Mr. Latham, any questions?
    Mr. Latham. No.
    Mr. Walsh. Mr. Fazio, any questions?
    Mr. Fazio. Thank you, Mr. Chairman.
    I want to welcome Jay and his staff and wish them all the 
best in moving forward the CAO position.
    I know this is a relatively new position, and I know we can 
count on you to perform effectively and, I hope, far less 
prominently than your predecessor. I say that in the best 
sense, because I think this is a job that really does not 
require high profile, it just requires a job well done. I think 
your background in, user services here will be very helpful to 
others who depend on what is made available through your 
offices. I think you have already made that clear.

                         HIR STAFFING CONCERNS

    I am also concerned about HIR. You talk about redirecting 
them. Is that why we are going to see a decrease in full-time 
equivalents of 25 people? That is the current budget, I 
understand. What does this downsizing imply?
    Mr. Eagen. It implies a couple of things, and I think it is 
actually from the appropriated approved level from last year, a 
29 FTE reduction. Part of that is a transfer of certain skill 
sets to more appropriate functions within the CAO, a small 
number.
    For example, the Committee on House Oversight this past 
fall approved a reorganization of the Finance Office, and we 
took the financial computer people, and transferred them so 
that they are now within the Finance Office with that system.
    Second, it is a recognition that there is a fiscal 
constraint facing the entire CAO. We simply have to show some 
discipline. Third, it is a reflection of what is, basically, 
the personnel status at HIR today. The count as of 2 days ago 
was 220 people.
    Mr. Fazio. So if you did not have the restraints of the 
overall budget, other initiatives, that you have had to engage 
in, if that restraint was not there, you would probably look to 
other staffing? Do you think it is going to at some point be 
important to repair some of those losses?
    Mr. Eagen. I think that is a definite possibility. The 
outcome needs to be driven by this mainframe migration study, 
and it needs to be driven by the strategic assessment that we 
are doing right now.
    Mr. Fazio. You are going to be using that as a guidepost in 
terms of whether you want to bring additional people on, 
perhaps people with different skills.

    DISCUSSION ON COMPETITION FOR HIGH QUALITY TECHNOLOGY PERSONNEL

    Mr. Eagen. Yes. And I think, in addition to that, there is 
an interesting article in the Business section of the Post 
today about the status of competition for high-quality 
personnel in the technology industry.
    Mr. Fazio. Exactly. There was a feature a couple of weeks 
ago composed about the region and the problem of hiring in the 
high-tech fields. I guess that was really where I was going 
with my next question, merit pay. Are we going to be able to 
find the wherewithal to hire not just people to fill the slots, 
but the quality of people who we need to really perform in 
perhaps more challenging jobs that will be made available?
    Mr. Eagen. Well, the answer is, we need to. It is going to 
be a challenge. In the article this morning, for example, the 
Post indicated that even in the private sector, most of the 
technology firms in this area, I think, are suffering a 20 
percent vacancy.
    When we did the job search to hire Mr. Campen, one of the 
consultants that was on board, the person that was running HIR 
in the meantime, said, ``Jay, I hope you understand that for 
this kind of position in the private sector, we are talking 
about double the salary that you are offering.''
    Mr. Fazio. I think we have got to be realistic about this. 
I am afraid that, just as we have been doing for years in law 
enforcement here, we are going to become a training ground, we 
are going to give people opportunities they would not have 
elsewhere, pay them something that would be seen as generally 
not adequate, and then after they get the skills, they are out 
the door to one of these private firms in the region and we are 
back starting all over again with relatively inexperienced 
people.
    Do you have any thoughts about how we may help you deal 
with this problem? because I do not think it is going to be 
short-term. When you have got numbers like 20 percent, you 
know, this is probably ongoing.
    Mr. Eagen. I believe the first answer to that question is, 
again, we need to complete the strategic assessment. And what 
is anticipated at the end of that is a recommendation to the 
Committee on House Oversight for a new structure for HIR.
    My own personal view is that it is kind of a boxy structure 
that is not very adaptable and that any time technology 
changes, it requires us to submit a very complicated 
reorganization to the Committee on House Oversight, so that by 
the time we get that done, technology passes the House by.
    My vision personally--and this is something the committee 
will have to discuss, quite obviously--is that we should try to 
create a more flexible, adaptable organization. That is what 
the computer industry does, they organize themselves every 
month, and I think that if the committee sees that that is a 
wise direction to pursue, that is where I would like to go.
    With that, though, I think some of the pay levels for some 
of the senior managers in the organization should be raised. We 
already submitted an interim office reorganization proposal to 
the Committee on House Oversight that has been approved. It 
creates a deputy HIR director for the first time. And it does 
start, in fact, with some of those positions.
    Mr. Fazio. When do you think that the report would be a 
more formal assessment?
    Mr. Eagen. We started the process last week, where Mr. 
Campen presented to the senior managers the template that the 
Peat Marwick folks presented to us revised with some of his own 
stamp on it. We would like to do this in a way that involves 
the senior managers so they are vested and brought into it 
rather than just being something that Jay Eagen enforces on 
everybody.
    Our hope is to have something to the Committee on House 
Oversight by, I think, the March 30 time frame.
    Mr. Fazio. So we may have it at our markup hearing, some 
feedback from House Oversight, as to how they may proceed?
    Mr. Eagen. Yes.
    Mr. Fazio. Because you would hope to do something next 
fiscal year?
    Mr. Eagen. We would like to move it as aggressively as 
possible.
    Mr. Fazio. So we might be asked to do a supplement or, at 
least, reappropriating?
    Mr. Eagen. You are thinking two steps ahead of me, Mr. 
Fazio. That is a good point.
    Mr. Fazio. I am trying. I am not trying to discourage you, 
obviously; I am encouraging you. I realize that all of this is 
a lot of strain on this committee's funding, but it is penny-
wise, pound-foolish for us trying to run our systems here 
inadequately, and we may just need to belly up to the bar, as 
they say, and come up with the money that is going to be 
required to be competitive.
    I am looking forward to the assessment as well, because I 
think we are not at a point where we can make this decision. 
But I do believe it will inevitably be a part of the problem we 
have to solve, and it will not be easy.
    Mr. Eagen. No.
    Mr. Fazio. And lots of turnover, even though it is endemic 
in the industry, is not going to be helpful to us.

                     QUARTERLY MASS MAILING REPORTS

    There is one other issue I wanted to bring up, and that 
relates to the quarterly mass mailing reports that are now 
required in the Castle amendment. I just wondered, in which 
report were mailings on the 1st or 2nd posted in the future? 
Members may need to know this kind of information.
    Mr. Derville. That has been a discussion within our office, 
as to where they go. There has been some confusion on that. We 
have asked each office to give us that information as of the 
end of December, which is, I believe, what the statute 
requires. And, working with them, when we find that there is a 
discrepancy in the actual data reported, we will reflect the 
correct placement for reporting depending on what is 
appropriate.
    Mr. Fazio. So that is a decision that will be made kind of 
ongoing?
    Mr. Derville. Yes.
    Mr. Fazio. Would you want us to try to reconcile that? Is 
there a need for us to act?
    Mr. Derville. At this point, I do not think so; no, sir.

                   IMPROVEMENT ON VOUCHER PROCESSING

    Mr. Fazio. On the issue of financial management systems--
and I apologize for not being here to hear all of your 
presentation--this is clearly where Members were most upset in 
the last regime, was the inability to get that system under 
control, because it was embarrassing for them to be in arrears 
with vendors, et cetera.
    In terms of voucher processing and monthly reporting, have 
we got that system put together now to the degree that you are 
satisfied?
    Mr. Eagen. Frank can fill you in on the details, but my 
sense is that we have. We are still, however, in what is 
characterized as a stabilization phase, for the Federal 
Financial System, FFS. FMS is the payroll system. We process 
80,000 vouchers a year.
    We keep a daily tracking record of the point that that 
voucher gets to the Finance Office to the point the check is 
cut. For 1997, the average processing time was 6.17 days. What 
Members remember so vividly was the period shortly after, as I 
understand it, FFS was installed, that processing time was up 
to about 18 days. The goal is 5 days.
    One thing that we have done as part of the Finance Office 
reorganization that the Committee on House Oversight approved 
is modify the voucher processing. The administrative handling 
of it, was handled by an outside contractor, Don Richards 
Associates. We have brought that back in House, or shortly will 
do so.
    Our hope is that, with full-time employees and less 
turnover that is part of the contract, we will be able to get 
that down within that 5-day limit.
    Mr. Fazio. We are getting into publicization from 
privatization?
    Mr. Eagen. Professionalization.
    Mr. Fazio. Professionalization? I like that.
    Well, I am sure Mr. Hoyer and I, having been through that 
period on the Oversight Committee, find this kind of delicious 
actually. But it is getting us to the 5-day turnaround, and 
that is the key.
    Mr. Eagen. That is the objective, yes.
    Mr. Fazio. I have some other questions for the record. But 
I thank you very much. I wish you well.
    [Questions from Mr. Fazio and responses follow:]

    Question. Last year there was a controversy about the 
release of social security numbers from payroll files, and two 
people lost their jobs over it. But I understand that these 
payroll certification forms are not now available to the public 
after having been available for 20 years. What are your plans 
for making this information available again? Is it a question 
of resources: for example, are you lacking the necessary 
resources to clean up the microfilm to make this information 
available?
    Response. Last Fall, it was discovered that a significant 
number of Social Security numbers of House employees had been 
released when microfilmed copies of payroll certification forms 
from employing House offices were made publicly available at 
the Legislative Resource Center. Copies of payroll 
certifications altered to ensure the removal of all personal or 
confidential information i.e. Social Security numbers, had 
traditionally been made available to the public in the Center. 
In light of the discovery that errors in processing had 
occurred, I immediately directed that all payroll certification 
files be removed from the LRC's public information area until a 
review of payroll certification files could be completed, a 
determination made regarding the extent of the problem and a 
report given to the Committee on House Oversight.
    After reviewing the LRC's payroll certification files from 
1977 to 1997, it was determined that a variety of errors had 
occurred consistently throughout the years of processing this 
data. Social Security numbers had been inappropriately released 
for several years and I had no confidence that any of the files 
could be utilized or corrected for future use. In light of 
these facts, I wrote the Committee on House Oversight to report 
on these discoveries and to seek direction on the future 
release of information. At this time, I am awaiting further 
information from the Committee on House Oversight. I anticipate 
this matter to be resolved in the near future based on their 
further instructions.
    Another impact of this discovery has been a legal review of 
the statutory authorization or requirement for such payroll 
certifications to be made publicly available at the LRC. This 
is an issue also being addressed by the Committee on House 
Oversight. I appreciate the question regarding if resources are 
now available to make these files available to the public. 
Resources are available to do this task once policy and 
procedures are clearly determined.
    Questions. The Castle Amendment requires mass-mail 
reporting in the quarterly Statement of Disbursements. I notice 
that you are counting January 1 and 2 as part of the 4th 
quarter. In which quarterly report will mailings posted on 
January 1 or 2 be reported?
    Response. Per the remainder dated January 9, 1998 as 
directed by the Committee on House Oversight, ``Member offices 
are reminded that their completed quarterly Mass Mail Reporting 
Form, covering the mass mail sent during the period of October 
1, 1997 through January 2, 1998'' should be submitted for 
inclusion in the 4th quarter (December '97) Statement of 
Disbursements for the House.

    Mr. Eagen. Thank you.
    Mr. Walsh. Thank you, Mr. Fazio.
    Just a small point of clarification for the record. As Mr. 
Fazio was complimenting you on your performance and comparing 
you less than favorably to your predecessor, I just wanted to 
make sure that the record is clear that he meant the initial 
person who held that position, as opposed to your immediate 
predecessor, former acting director----
    Mr. Fazio. Absolutely. Jeff is smiling in the back row. He 
knew who I meant.
    Mr. Walsh. I know he did. I want to make sure, because the 
record did not show him smiling.
    Now I would offer the opportunity to ask questions to Mr. 
Hoyer, our newest member. Welcome.
    Mr. Hoyer. Thank you.
    Mr. Walsh. Delighted to have you. You have big shoes to 
fill with Ms. Kaptur. And I am sure she has got other things to 
do now, too. So we are glad to have you.
    Mr. Hoyer. Thank you very much, Mr. Chairman. I am pleased 
to join the subcommittee. I apologize for being late.
    Mr. Walsh. It is a bad precedent for our subcommittee.

                         mr. hoyer's statement

    Mr. Hoyer. Right. I understand that. Mr. Porter had a 
hearing contemporaneously with this, and I had to be there.
    I do not have any questions because I was late and because 
I just joined the subcommittee last night. But, obviously, as 
you know, as a member of the House Oversight Committee, we 
spend a lot of time with the Administrator and with the other 
Officers of the House. And I will look forward, as Mr. Fazio 
has done.
    Mr. Fazio, as all of us know, is leaving. He is going to be 
a tremendous loss to the House, as an institution, above and 
beyond the loss to his District and to the State of California 
and to the Nation in terms of policy and, from our party 
standpoint, the leadership of our party.
    But in this context, his contribution as chairman of this 
committee and as the ranking member on the House Oversight 
Committee in the last Congress has brought an extraordinary 
amount of devotion to this institution and to the membership 
and the employees of this institution. And I am pleased to be 
serving with him in his last year on this committee, and it 
will be a real loss to us when he leaves. But I want to share 
his view.
    I had some concern which was alleviated when he went from 
acting to permanent, not because of the individual but because 
I was concerned about the partisanship that it might imply. And 
I have unrestrained trust and faith in his judgment, and he 
assured me that Mr. Eagen was the kind of guy we need as 
members of the House Oversight Committee. And I have concluded, 
as I thought I would, that he was absolutely correct.
    But the professionalization of the staff that does 
ministerial duties in this House is absolutely critical for us 
to follow through on, Democrats and Republicans, because it is 
not a partisan issue. When we did not do that, it did not serve 
the institution well, much less the interest of either party. 
And I think we are moving in the right direction. And I 
congratulate Mr. Fazio and Mr. Gingrich and Mr. Gephardt and 
others who were involved in this effort. And I look forward to 
serving on the subcommittee, Mr. Chairman.
    Mr. Walsh. We are delighted to have you. We are very much 
aware of your involvement in issues as related to the 
legislative branch. We know you represent many, many of these 
folks. And I am quite sure you will do a great job representing 
their views here.
    Tom, I believe I asked you if you have any questions.
    Mr. Latham. I would also say I look forward to this final 
year with Vic. We also serve on the Ag. Approps. subcommittee 
with the chairman here also and Frank Sinatra.
    Mr. Walsh. Legislative and agriculture.
    Mr. Latham. I cannot help it.
    Mr. Serrano. Do you realize that I could put in a bill that 
finds a cure for AIDS and I will still be remembered for that?
    Mr. Latham. That is right, and for the 22 votes that day.
    But I do think there will be a great loss institutionally 
here with Vic going. And I share his real concern as far as 
reimbursement of the vouchers. I think it is apparent that, as 
far as Members' reimbursement, it is done much better. I mean, 
I have not had my credit card rejected lately like I did 
before.

                discussion on timely voucher processing

    But I still have real concerns about reimbursement of 
staff. It does not seem to be that that is handled as quickly 
as it is for Members. And I know my chief of staff is in the 
District and comes back and forth on a monthly basis and has 
experienced real difficulties as far as getting reimbursement 
on a timely basis. So I think that there has been great 
improvement, but it is still a real concern to me.
    Mr. Eagen. Mr. Latham, let me just comment very quickly. 
Someone suggested to me the other day, when we are looking at 
some of the procedures in the organization, that it is kind of 
like an onion, you keep peeling, and you get 20 layers down, 
then you start crying.
    When it comes to that kind of thing, you are probably 
referring most directly to reimbursement for a piece of 
equipment she may have bought back in the District or things 
like that. I think it is an area that requires some attention 
and we are giving some attention to.
    Mr. Latham. And travel reimbursement has been a real 
concern.
    Mr. Serrano. Mr. Chairman, if I may, very briefly, I, too, 
want to emphasize how important it has been for us to begin to 
see a change in the reimbursement procedure. It was 
embarrassing a few times at Amtrak to be turned down for my 
credit card. Of course, that is because I forgot and gave them 
my own personal one. But we got that straightened out.
    But when somebody calls you up and says, guess what, you 
are 7 months behind, or 6 months behind, on a payment, I say,I 
submitted the voucher, I have nothing to do with that.
    Let me just take, since we have been through this before, 
Mr. Chairman, a few seconds here to say I find myself in a 
unique situation this year because I have to my left--not my 
political left, but to my left----
    Mr. Hoyer. He is retiring, but I have got to answer to 
that.
    Mr. Serrano. Not my political left. Mr. Hoyer and Mr. Fazio 
are really unique individuals that I have a lot of respect for. 
And it is interesting--and I say this most sincerely--one 
reason I respect them so much, amongst the many reasons, one in 
particular, is that they are not Congress-bashers, they are 
just the opposite, they respect the institution and they 
support the institution.
    And one of the reasons I accepted this assignment to the 
subcommittee was the work Mr. Fazio did in standing up on the 
floor and defending the institution and defending the staff and 
defending the membership. That is very important these days, 
because so many people would like to bring us down.
    And so this last year with Vic in Congress is a very 
important one for me. And I have the utmost respect for you.
    Mr. Fazio. Thank you.
    Mr. Serrano. And standing during the Committee last night 
was not easy, but Mr. Hoyer did it.
    He is also a person who represents many of the people that 
work in this institution. And it is just good to know that that 
is the kind of backup I have here and backup that you have for 
the work that we have to do.
    Mr. Walsh. It should be a good year.
    [Questions from Mr. Serrano and responses follow:]

    Question. How much has been spent from the Speaker's slush 
fund for ``unanticipated'' Committee investigations this 
Congress?
    Response. As of February 3, 1998 there has been $277,105 
expended from the Reserve Fund.
    Question. In the September 15th edition of The Hill, it was 
reported that Mr. Goodling advised you, ``Don't let them bring 
the restaurant service in-house or you're going to end up in 
the nut house.'' Food service has certainly been a challenge 
over the last several years. Based on the experience with 
privatized food service, in your view, can a House food service 
contractor meet Congressional demands for price and service 
levels, be humane employer of long-time House food service 
workers, and still make a profit?
    Response. A professional food service management company 
like Guest Services, Inc. can certainly meet Congressional 
demands for price and service levels and also treat all food 
service employees in a fair and just manner. The new contract 
with Guest Services, Inc. is structured in a way that the 
contractor can readily attain profitability as long as they 
adequately control their business. The new contract also gives 
the House a measure of supervision through the Quality 
Assurance Plan, which is outlined in the contract. With the 
Quality Assurance Plan, the new food service contract and Guest 
Services experience, we fully expect that Guest Services, Inc. 
will realize a profit and exceed Congressional expectations for 
price and service levels.

                           child care center

    One last question, and that is the status of the House 
Child Care Center. I understand our new director is here. Maybe 
you could introduce the director.
    Mr. Eagen. Yes. Thank you.
    Mr. Chairman, subcommittee members, Christine Ehrenberg, in 
the blue dress in the back row, is the new director. Natalie 
Gitelman, who was the longtime director of the child-care 
facility, retired in November, and Christine has been with us 
since that time.
    Mr. Walsh. Welcome. Good to have you with us. Great.
    Status?
    Mr. Eagen. Christine.
    Ms. Ehrenberg. In terms of numbers and things like that?
    Mr. Walsh. Location.
    Mr. Eagen. I will speak to that.
    Mr. Walsh. That was the intent of the question.
    Mr. Eagen. I guess my public position is, we are still 
looking at it. There are three elements to it. What I referred 
to in my testimony with regard to relocation of the X-ray 
facility, the primary concern has to be that we do not put a 
child-care facility in a place that is viewed as----
    Mr. Walsh. Checking for bombs.
    Mr. Eagen. Right.
    Mr. Walsh. Good idea.
    Mr. Eagen. The Sergeant at Arms is a wise man. That is the 
first step. And we have been working with the Sergeant at Arms 
and the Capitol Police to look at the steps that are necessary 
to relocate that facility. But it is also an element in the 
contract negotiations that I also referenced with having a 
request for proposals on the street for a new postal services 
contractor, because the contractor will be the person running 
those trucks.
    Thirdly, then, is working with the child-care center. And 
this work has already begun. Christine and I took a tour with 
the Architect's folks and Bob Miley, the Superintendent of the 
House, to look at the space that is available. Christine is now 
working with the Architect's design folks to see how that space 
can best be set up to accommodate an improved child-care center 
for the House.
    Ms. Ehrenberg. Natalie is enjoying retirement and I'm 
enjoying being here.
    Mr. Walsh. Duly noted. Thank you.
    That, I believe, finishes the questions for this round. And 
we go back to you, Jay, for further introductions.
    Mr. Eagen. Thank you, Mr. Chairman.

                      office of inspector general

    Referring to page 63 of the subcommittee print for salaries 
and expenses for the Office of the Inspector General, 
$4,379,000, Mr. Chairman, I request to submit the balance of 
page 29 for the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Page 89--The official Committee record contains additional material here.]


    Mr. Eagen. And I would like to introduce Mr. John Lainhart, 
Inspector General of the House.
    Mr. Walsh. Welcome, Mr. Lainhart.
    Mr. Lainhart. Good morning.
    Mr. Walsh. Would you like to make a brief opening 
statement?
    Mr. Lainhart. Very brief.
    Mr. Walsh. All right.

              opening statement from the inspector general

    Mr. Lainhart. Good morning, Chairman Walsh, Congressman 
Serrano, Members of the Subcommittee. I am pleased to be here 
today to discuss the House Inspector General's Fiscal Year 1999 
budget request. With me is my deputy, Bob Frey.

                            accomplishments

    I would like to very briefly highlight the OIG's 
accomplishments from the first session of the 105th Congress, 
the planned audit work load for Calendar Year 1998, and the 
required resources to maintain that effort in Fiscal Year 1999.
    During the first session of the 105th Congress, the OIG 
issued 15 audit reports, making a total of 189 recommendations. 
We also completed three major investigations involving serious 
procurement, financial, and management irregularities. One of 
these dealt with specific problems in the Office of the Chief 
Administrative Officer during the 104th Congress, and the 
resulting report was released publicly pursuant to provisions 
of last year's Legislative Branch Appropriations Act.
    In spring of this past year, we also implemented our 
Internet home page, giving the general public access to all of 
our audit reports.

                   Calendar Year 1998 Planned Audits

    After several years of continued growth, the audit work 
load necessary to provide adequate oversight of the House seems 
to have leveled off, and our proposed 1998 annual audit plan 
contains 28 audits consisting of approximately 2,250 OIG staff 
days and 4,000 contractor staff days.
    Included in this total is a comparison of the wage 
structure and benefits in the House beauty and barber shops. 
Also we are in the process of completing the mainframe 
migration options study. Both of these studies were 
specifically requested by the subcommittee in last year's 
legislative branch appropriations report.

                    Fiscal Year 1999 Budget Request

    Our Fiscal Year 1999 budget request contains the resource 
requirements necessary to maintain the same level of effort as 
anticipated in Fiscal Year 1998. The total funding requested is 
$4.379 million. This includes a $386,000 increase to restore 
funds for the Calendar Year 1997 financial statement audit, 
which was removed from our Fiscal Year 1998 request and instead 
financed through reprogramming. This restoration is necessary 
in order for the OIG to maintain the same level of coverage in 
Fiscal Year 1999 that has been provided in the past 3 fiscal 
years.
    Mr. Chairman, with that, I will end my brief remarks and 
will be willing to answer any questions you might have.
    [The information follows:]

[Pages 92 - 100--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much. I really have no questions 
of Mr. Lainhart at this time, and so I will pass to Mr. 
Serrano.
    Mr. Serrano. Just very briefly.

                        discussion on year 2000

    I know that much has been said about this whole Y2K 
problem. I guess that the big question is, are we getting where 
we should be, in your opinion, after the comments you have had 
to make, or are we facing any major disruptions at midnight 
1999/2000?
    Mr. Lainhart. We issued an audit report just a few months 
ago, actually, and issued one prior to that back in December, 
1996 alerting the CAO's office of the fact that not much had 
been done and additional attention needed to be paid to this 
issue.
    Jay brought in somebody from the outside to do the initial 
assessment, and we cannot really answer that until we see what 
the assessment looks like. But, certainly, the proper actions 
are being taken, and the attention is being paid to it that was 
not being paid in the past.
    So I think except for some concerns that Jay and I share 
with respect to the payroll system--to make sure that we can 
get that taken care of in time. I think that except for those 
kind of items that we have already identified in our previously 
issued reports, we have things pretty well on track.

                        hir mainframe migration

    Mr. Serrano. Just one last question. Among the same issues 
that you are working together on, the HIR mainframe migration 
plan. Are you happy with the way that is beginning to turn out, 
also?
    Mr. Lainhart. Yes. We briefed Jay and CAO senior management 
yesterday on that, and I think we have come up with some real 
good options, that as a bottom line will avoid us having to 
maintain a mainframe in the House. I look on it with positive 
anticipation, if you will, in that there are better solutions 
than a mainframe.
    The industry has changed, and we need to change with it 
into the client/server environment and, of course, the Internet 
and the Intranet applications that HIR has been working to move 
the House towards. I feel very good about that as well.
    That study should be coming to both the Oversight Committee 
and this subcommittee within the next couple of months. We are 
very close to completing it.
    Mr. Serrano. Okay. Thank you.
    [Questions from Chairman Walsh and responses follow:]

    Question. As you know, the Financial Managers Council has 
strongly supported a common financial management system for the 
entire Legislative Branch. I know you support that concept. Is 
the House moving in a direction consistent with that objective?
    Response. To date, the Legislative Branch Financial 
Managers Council has not developed any Legislative Branch-wide 
standards. Therefore, the House does not have any specific 
guidance to follow. However, at a recent meeting of the FFS 
Steering Committee, the CAO recommended that the House's next 
step with respect to FFS be to determine the requirements for 
the permanent solution to its financial management system. His 
recommendation was unanimously endorsed by the FFS Steering 
Committee (which includes the co-chairs of the Legislative 
Branch Financial Managers Council). The FFS Steering Committee, 
as you are aware, was created, at the direction of the 
Committee on House Oversight, to help guide the House's 
financial management system activities, and in this role, the 
FFS Steering Committee is ensuring that the House's permanent 
solution is compatible with the needs of the entire Legislative 
Branch.
    Question. I would like to see some kind of report from you 
along those lines. Nothing extensive. Can you do a brief survey 
of this question and give us your conclusions?
    Response. As indicated in the answer to the previous 
question, the House is moving in the right direction, and the 
FFS Steering Committee is uniquely positioned to ensure that 
the House's permanent solution is compatible with the needs of 
the entire Legislative Branch. In addition to being members of 
the FFS Steering Committee, the OIG and our contractor, are 
providing continuous system development life cycle management 
advisory services to the CAO with respect to both the existing 
FFS and permanent solution efforts. As such, we look forward to 
working with this Subcommittee, in conjunction with the 
Committee on House Oversight, as the House moves ahead with its 
permanent financial management system solution, and will be 
glad to provide you with any information that you should need.

    Mr. Walsh. Mr. Fazio.

             progress with the financial management system

    Mr. Fazio. Mr. Chairman, I noticed John responding without 
speaking during some of the questions I was asking Jay, and I 
wondered if you might want to comment on the financial 
management system and its progress from your perspective. I 
think you made a number of recommendations over time. Are we 
getting where we want to go?
    Mr. Lainhart. Well, I think our problem is that until we 
got Jay and Frank on board, we had a little bit of stagnation 
there. Now that we have both Jay and Frank on board, it is a 
different world; it really is.
    In addition to Frank, he has brought on a project manager 
that has the technical background as well as the accounting 
background, and I believe that things are progressing slower 
than we all would like, but they are progressing.
    For example, as you recall on the House Oversight 
Committee, when the approval was given for the implementation 
of the new system, there were 10 items that still needed to be 
completed for phase two. Currently, four of those tasks have 
been completed. And, of course, the prior permanent CAO had 
promised that those would be completed within a month, and that 
is a few years ago now. We still have six tasks left, but they 
are being worked on vigorously by the Finance office, and it is 
anticipated that by the end of this summer those should be 
completed.
    In addition, other tasks dealing with stabilization of the 
system have been addressed and are being worked on at the same 
time. So we are working in parallel on both efforts. It is 
being worked on, and I think that there are major improvements 
there that will be completed, at the end of this summer.
    In addition, as Jay mentioned in his statement, the 
identification of the permanent solution, if you will, as 
opposed to this interim solution, is being addressed by the 
CAO's team, and I think that is definitely the right move to 
make. We should be able to look towards the new millennium with 
a new system in mind.
    Mr. Fazio. Are you providing any additional input to that 
team? Are you providing oversight?
    Mr. Lainhart. We provide free consulting--that is probably 
the best way to describe it. It is out of my budget, you know, 
but we provide both my staff--I have one person that works on 
it, and then Price Waterhouse is continuing in a software 
development life cycle type of contract, which provides 
participation by reviewing.
    Mr. Fazio. I don't want to create any nervousness at Price 
Waterhouse, but let me ask generally, are we continuing to work 
with one outside accounting firm to do most of this work, or 
are we broadening our services rendered by the various people 
in the merging private sector?
    Mr. Lainhart. That is a hard question to answer right now.
    Mr. Fazio. Pretty soon there will be one accounting firm if 
it keeps up.
    Mr. Lainhart. That is right. Right now, in fact, on board, 
we have three CPA firms working for us.
    Mr. Fazio. That is good.
    Mr. Lainhart. In addition, we had a fourth one working for 
us, I guess, last year. We compete the contracts using the GAO 
task order contract. There are five CPA firms working on it, 
and we have had four out of the five working for us.
    Each one really has done a major audit. I can cite them for 
you, if you will. But, of course, it was a lot better before 
Coopers and Price Waterhouse agreed to their merger and KPMG 
and Ernst & Young agreed to their merger. So we are going down 
to smaller numbers competing for our contracts.
    Mr. Fazio. I still think it is important that we have 
relations with all of them. It is good for competition. It is 
also good that they know the people in our systems here.
    Mr. Lainhart. And, in fact, before we do an advertisement 
of a new task order, I personally call each one of the partners 
that are responsible for the GAO task order contract to alert 
them to the fact that it is coming out and encouraging them to 
bid on it. And we have had all five bid as well.

                  member mass mailing recommendations

    Mr. Fazio. I understand there is a new disbursement 
procedure being implemented for Member mass mailings. Is this 
one of your recommendations? I understood it had been done in 
part at your request.
    Mr. Eagen. Obligation of mass mailings.
    Mr. Lainhart. The obligation of mass mailings, yes, sir, 
that is correct. That is one of our recommendations, and it 
deals with the major problem that we have with getting a clean 
opinion for the House. It deals with mass mailings that go to 
USPS, and we get the reports from USPS back sometimes 2 years 
late. So there is no way to anticipate that expense, and it 
really does affect the opinion for the House.
    We made a recommendation that if Members could go ahead and 
obligate for that, then we could get around that problem. It 
doesn't have to be 100 percent accurate, but if we can get 
closer and have a better number in our accounts, when the 
financial statement audit is performed, then we will get closer 
to a clean opinion.
    Mr. Fazio. Is it a new form that the Members will be 
required to fill out?
    Mr. Lainhart. I believe so.
    Mr. Fazio. Is there going to be, if you are going to use 
that rationale in the mass mailing area, any effort to 
implement that same concept in other areas such as rent, leased 
cars, equipment purchases? Because I think we have had similar 
problems, haven't we, in those areas?
    Mr. Lainhart. They are small by comparison. And, in fact, 
there have been things put in place within finance that reduce 
the problems in these areas. For example, on the leases, we do 
have records of the leases, so now we have those accrued in the 
financial statements.
    The equipment, the new fixed asset system certainly will 
help there, but it is small by comparison and not necessarily 
going to interfere with the opinion.
    Mr. Fazio. Is it your opinion that didn't prevent the clean 
opinion?
    Mr. Lainhart. No, that is correct. The mass mailing was the 
one single largest issue. There are some others, too, and they 
do accumulate but mass mailing was the biggest issue.
    Mr. Fazio. Of course, this was an area where Members 
occasionally went over their accounts, and we have had some 
unfortunate personal situations there, unfortunate press. 
Hopefully this will all be managed more effectively, and this 
kind of inadequacy or inaccuracy won't be happening anymore.
    Mr. Lainhart. Our objective really isn't to worry about the 
opinion, if you will. Our objective is to give Members better 
information so they can make better decisions on their own. And 
that is the purpose behind it, exactly.
    Mr. Eagen. The process is integrated with the franking 
approval form that had been existing. So the Franking 
Commission, once they process and make sure the mailing meets 
those standards, then passes it on to the Postal Operations 
Office, and it is input in the FFS system as an obligation 
against the Member's account.
    Mr. Fazio. Makes sense. Hopefully Members will have no 
excuse if they can't keep track at this point. They are being 
reminded, in fact, by the system.
    Mr. Lainhart. It will be another tool.
    Mr. Eagen. That is right.
    Mr. Fazio. Thank you, Mr. Chairman.
    Mr. Walsh. Thank you, Vic.
    Mr. Hoyer.
    Mr. Hoyer. Thank you, Mr. Chairman.

                  implementation of personnel policies

    John, one of your reports, which goes back to July 18, 
1995, deals with the lack of sound personnel policies. What 
have you been doing in your office with reference to overseeing 
the implementation of the personnel policies?
    Mr. Lainhart. We haven't done any additional work 
specifically tailored towards that. Whenever we go into an 
entity to do an audit, we look at the associated personnel 
staffing, position descriptions, etc. to see if they are 
maintained, the ratings are being performed, that kind of 
thing. So we do do it on an individual audit basis. We make 
recommendations, like we did in HIR. For example, the 
discussion earlier about the salary levels in HIR, we looked at 
that in our report on HIR management and recommended that the 
salary levels be looked at because we felt that they were too 
low.
    We look at the implementation of the policies and 
procedures in each area and make recommendations for less 
staff, additional staff or reorganizations as appropriate.
    Mr. Hoyer. In addition to the levels of staffing, and the 
compensation for staffing and, therefore, the competitiveness 
which Vic, and I am sure Jim and the whole committee have 
talked about, I am sure, through the years so that we can be 
competitive and keep professional personnel, have you looked at 
the implementation of procedures for terminating employees, in 
particular as it relates to terminations for-cause, in the 
pursuit of having professional employees, as opposed to 
partisan employees? Have you looked at any of that?
    Mr. Lainhart. No, we have not looked at that.
    Mr. Hoyer. Would that be within your purview, do you think, 
John?
    Mr. Lainhart. In fact, we have an audit in our proposed 
plan to look at benefits and personnel-related issues like 
that. So we do have it included, but we haven't initiated one 
of those audits yet.
    Mr. Hoyer. As you know, from our work on the House 
Oversight Committee, in my discussions with Mr. Thomas when Vic 
was on there, obviously in 1994 when we had a change, there was 
going to be a transition period, and that was understandable. 
It would have been the same if it had been us coming in. It 
just happens.
    We are now essentially beyond that, and I think we are 
working much more closely on making the system work. In that 
regard, we struggled when we were in control, and during the 
104th Congress, Speaker Gingrich and others, struggled with how 
do you professionalize a personnel system, dealing with 
ministerial duties, not policy-related duties, so that the 
employees feel that they are working as professionals for an 
organization, i.e., the House, as opposed to working for either 
party?
    Mr. Serrano, I understand, asked some questions earlier. I 
am sorry that I missed Robin Carle's testimony. I was concerned 
by the five employees who were fired just recently, which 
appears not to have been for cause. It appears that it was 
taken as a reorganization, but, in fact, it is my understanding 
that there is an advertisement for at least two very similar 
positions to be filled. I am not sure whether the employees who 
were let go are going to be considered for that job. I 
apologize for missing the questions.
    It seems to me we need to look at that from both parties' 
standpoint, because we are reaching an agreement now that this 
is not a partisan issue. It serves both parties' interests and 
the institution's interest to have a professional cadre.
    Mr. Chairman, I might pursue that with Mr. Lainhart maybe 
in terms of a request that we will give him either from House 
Oversight or from this committee so that we can see how our 
personnel system is developing and how it is being implemented 
and whether or not, in fact, we are reaching the objectives of 
that professionalization of the nonpolicy staff.
    Mr. Chairman, thank you very much.
    Mr. Walsh. Thank you.
    I guess that concludes Mr. Lainhart's testimony and 
questions. Thank you very much, John, for that.
    And, Jay, we will go back to you to wrap up.

                   balance of officers and employees

    Mr. Eagen. Referring to pages 64 through 65 of the 
Subcommittee Print for salaries and expenses of the Office of 
the General Counsel, $840,000; pages 66 through 67 of the 
Subcommittee Print, the Office of the Chaplain, $136,000; for 
salaries and expenses of the Office of the Parliamentarian, 
including the Parliamentarian, Compilation of the Precedents, 
$2,000 for preparing the Digest of Rules, $1,106,000; for 
salaries and expenses for the Office of the Law Revision 
Counsel, $1,957,000; for salaries and expenses for the Office 
of the Legislative Counsel, $4,980,000; for salaries and 
expenses for the Corrections Calendar Office, $810,000; and for 
salaries and expenses for other authorized employees, $191,000.
    Mr. Chairman, I request that pages 30 through 36 be 
included in the record, and I would like to note that the 
general counsel, the law revision counsel and the legislative 
counsel are here in the room to answer any questions that the 
subcommittee might have.
    Mr. Walsh. Those pages are admitted into the record without 
objection. We will also include biographies of the three new 
heads of the legal offices.
    [The information follows:]

[Pages 107 - 113--The official Committee record contains additional material here.]


                          Geraldine R. Gennet
    Bar Admissions: District of Columbia, Maryland, New York, and 
various federal courts.
                               employment
    7/97-Present.--General Counsel. Acting General Counsel (6/96-6/97). 
Deputy General Counsel (9/95-5/96). Office of General Counsel, U.S. 
House of Representatives. 219 Cannon House Office Building, Washington, 
DC 20515. (202) 225-9700.
    7/91-9/95.--Litigation Counsel. Office of Thrift Supervision. 1700 
G Street, NW., Washington, DC 20552.
    2/86-4/91.--General Counsel. Metropolitan Police Department. Room 
4215, 300 Indiana Avenue, NW., Washington, DC 20001.
    12/81-2/86, 6/75-5/79.--Sole Practitioner (civil and criminal 
litigation). Washington, DC.
    5/79-12/81.--Associate. Hirschkop & Grad, P.C., 108 N. Columbus 
Street, Alexandria, Virginia 22313.
                   professional and civic activities
    1988-Present.--Civil Division Rules Committee of the Superior 
Court.
    1987-Present.--Juvenile Rules Advisory Subcommittee of the Family 
Division Rules Committee of the Superior Court.
    1988-1991.--Volunteer Civil II Mediator. D.C. Superior Court's 
Multi-Door Dispute Resolution Program; participated in Settlement Week 
1988-1990.
    1989-1992.--Ad Hoc Committee on Drugs and the Criminal Justice 
System, American Bar Association Section of Criminal Justice.
    1988-1991.--Vice Chair. Committee on Criminal Law and the 
Administrative Process, American Bar Association Section of 
Administrative Law.
    1987-1989.--Special Committee on the Application of the Model Rules 
of Professional Conduct to Government Lawyers of the District of 
Columbia Bar.
    1981-1985.--Disciplinary Hearing Committee of the District of 
Columbia Board on Professional Responsibility.
    1/89-Present.--Board of Directors of the Metropolitan Police Boys 
and Girls Club.
                               education
    The American University, Washington College of Law. J.S. 1974. Yale 
University. B.A. 1971. Wellesley College (67-69).
                             John R. Miller
    Mr. Miller was appointed the Law Revision Counsel of the House of 
Representatives in November 1997. He has been with the Office of the 
Law Revision Counsel since October 1975, as an assistant counsel until 
July 1994, and as Deputy Law Revision Counsel after that date.
    From June 1972 until October 1975, he was an assistant counsel with 
the Office of the General Counsel of the United States General 
Accounting Office.
    He received a degree of Bachelor of Arts with Honors with a major 
in economics from the University of Cincinnati in June 1969.
    He received a degree of Juris Doctor With Honors from the George 
Washington University in June 1972.
    He was admitted to the practice of law in the Commonwealth of 
Virginia in 1972, and is a member of the Virginia State Bar.
    Mr. Miller is married to Cynthia H. Turner. They have a son and a 
daughter, and live in Arlington, Virginia.
  Biographical Sketch for M. Pope Barrow, Legislative Counsel, United 
                    States House of Representatives
    Mr. Barrow was born in Savannah, Georgia, on December 26, 1942. He 
attended the Gilman School in Baltimore, Maryland from 1955 until he 
graduated in 1961. After obtaining a BA from Yale University in 
Political Science in 1965, he attended Harvard Law School where he was 
awarded a JD in 1968. Mr. Barrow was admitted to the District of 
Columbia Bar in 1968 and began employment with the Office of the 
Legislative Counsel in that same year.
    From 1968 through 1969, Mr. Barrow was a Law Assistant in the 
Office of Legislative Counsel where he drafted private bills, 
constitutional amendments, concurrent resolutions and miscellaneous 
bills for individual members of the House of Representatives.
    In 1969, he was appointed Assistant Counsel and drafted legislation 
involving public lands, water resources, energy law, historic 
preservation, clean air, solid waste disposal, toxic substances, 
criminal law, foreign assistance, war powers, mining and mineral 
issues, income and estate taxes, pension reform, and numerous other 
subjects.
    In 1993, Mr. Barrow was appointed Deputy Legislative. In this 
position, he continued to draft legislation and also assisted the 
Legislative Counsel with management of the Office. On August 1, 1997, 
the Speaker of the House, Newt Gingrich, appointed Mr. Barrow as 
Legislative Counsel to the United States House of Representatives with 
statutory responsibility for management of the Office of the 
Legislative Counsel.
    Mr. Barrow is married to Giulia Barrow. They have three children: 
Isabel Barrow (age 20), Pope Barrow (age 15), and Rebecca Barrow (age 
6). Mr. Barrow is an active whitewater kayaker who has explored 
whitewater rivers throughout the United States, Canada, Mexico, Costa 
Rica, and Chile.

[Pages 116 - 126--The official Committee record contains additional material here.]


    Mr. Walsh. Do any of the Members have any questions of any 
of those other officers?

              clarification of corrections calendar office

    Mr. Fazio. I wondered if I could just get a little bit more 
information about the product of Corrections Calendar Office. 
This is one that has always intrigued me. I realize it is a 
bipartisan office, but I still question what it does, which I 
know can be troublesome when you don't know the answer to your 
question.
    Jay.
    Mr. Eagen. Mr. Chairman, I have to--Mr. Fazio, I would have 
to reply for the record. We don't have a representative of the 
Corrections Calendar Office here with us today.
    Mr. Fazio. All right. I would be interested in that 
response.
    Mr. Walsh. If you like, we will submit that for the record 
and make sure it is responded to in a prompt manner.
    Mr. Fazio. All right.
    [The information follows:]

    Question: Could we get a little more information about the 
product of Corrections Calendar Office. What does this office 
do?
    Response. This office is used by the Speaker, Minority 
Leader and other Leadership offices to assist in management of 
business related to the Corrections Calendar and other 
leadership priorities. See attached for more detailed 
information.

[Pages 128 - 149--The official Committee record contains additional material here.]


    Mr. Walsh. Any other questions?

                          attending physician

    Hearing none, if I may, I see Dr. Eisold has joined us, the 
Attending Physician.
    Doctor, would you like to come up to the table and join us 
briefly? Do you have any comments you would like to make? It is 
good to have you with us today.
    Dr. Eisold. Nice to be here Mr. Chairman.
    Mr. Walsh. You are an integral part of the legislative 
branch of government, providing many services.
    Dr. Eisold. Thank you Sir. I am here with my assistant 
Robert Burg, and I really don't have any prepared statement to 
make, but I would be happy to respond to questions from the 
committee.
    Mr. Walsh. Well, let me just again welcome you here.
    The Attending Physician is responsible for the medical care 
of our pages, emergency care and immunizations for Capitol 
Police, and emergency care for the millions of visitors who 
tour the capitol complex, as well as providing emergency and 
other medical care for the staff and Members of the House and 
Senate.
    One question that you may or may not be prepared to respond 
to, the Sergeant at Arms talked about evacuation. I believe 
Congressman Serrano asked about evacuation and so forth. Could 
you give us your thoughts on dealing with either chemical or 
biological threat to the Capitol and whatprocedures you would 
be prepared to take?

               response to chemical or biological threat

    Dr. Eisold. My staff is fully trained and equipped to 
respond to chemical casualties or biological events in concert 
with the Capitol Police and various outside resources from the 
local area, or even from afar. That would include threat 
identification, triage, treatment, potentially decontamination 
and evacuation.
    I think that in view of the sensitivity of the process and 
the security implications, I would prefer to perhaps at your 
convenience give you a briefing in my spaces and review the 
equipment and our procedures in detail at that time, or with 
any members of the committee.
    Mr. Walsh. Sure. If any of the Members would be interested 
in witnessing that, I would welcome them and maybe we can go 
together.
    Can you comment on how many people you could deal with in 
an event?
    Dr. Eisold. It varies on how much backup is requested. I 
think it would depend upon the threat assessment at the time as 
to how many outside resources you might bring in, so that our 
capabilities, as first responders would be augmented in the 
preparation for the State of the Union or a joint session. The 
exact numbers of what we could take care of would probably be 
better discussed at another time.
    Mr. Walsh. All right. Fair enough.
    Are there any other questions of Dr. Eisold?
    No questions.
    All right. Thank you very much.
    Dr. Eisold. Thank you.
    Mr. Hoyer. Thanks.
    Mr. Walsh. Yes.
    Mr. Serrano. A lot of thanks.
    Dr. Eisold. Thank you, Mr. Chairman.

                        allowances and expenses

    Mr. Eagen. Mr. Chairman, for allowances and expenses as 
authorized by House resolution or law, $136,806,000 for the 
following sub-accounts which will be individually presented and 
discussed: Supplies and materials, administrative costs and 
Federal tort claims; official mail, non-Member; government 
contributions; and miscellaneous items.
    For supplies, materials, administrative costs and Federal 
tort claims, $2,706,000; for official mail for committees, 
leadership offices and administrative offices of the House, 
$500,000; for government contributions, $132,949,000; for 
miscellaneous items, $651,000.
    And, Mr. Chairman, I will submit for the record at this 
time a table reflecting the breakdown of the House Child Care 
Center fiscal year 1999 budget estimate. This request is for 
salaries and expenses in the amount of $580,000, and I request 
that pages 37 through 42 be submitted for the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 152 - 157--The official Committee record contains additional material here.]


                        balance of joint offices

    Mr. Eagen. Mr. Chairman, for salaries and expenses, for the 
Joint Committee on Taxation, $6,018,000; for the Office of the 
Attending Physician, $1,383,000; for statements of 
appropriations, $30,000. And I request that the balance of 
pages 43 through 45 be submitted for the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 159 - 161--The official Committee record contains additional material here.]


                            closing remarks

    Mr. Eagen. That concludes my presentation on the House of 
Representatives fiscal year 1999 budget, and I will be 
available to assist the committee with any additional 
information that it may need.
    Mr. Walsh. Very good. Thank you very much for your 
presentation and your responses to the questions. We have all 
submitted a number of questions for the record. We hope you 
would give us a prompt response to those.
    [A question from Chairman Walsh and response follow:]

[Pages 163 - 175--The official Committee record contains additional material here.]


    Mr. Eagen. Yes, sir.
    Mr. Walsh. Thank you, too, for your testimony today. You 
are excused.
                                        Thursday, January 29, 1998.

                          OFFICE OF COMPLIANCE

                               WITNESSES

GLEN NAGER, CHAIRMAN OF THE BOARD OF DIRECTORS
RICKY SILBERMAN, EXECUTIVE DIRECTOR
GARY GREEN, GENERAL COUNSEL
JAMES STEPHENS, DEPUTY EXECUTIVE DIRECTOR FOR THE HOUSE
PAMELA TALKIN, DEPUTY EXECUTIVE DIRECTOR FOR THE SENATE
BETH HUGHES-BROWN, BUDGET OFFICER

    Mr. Walsh. Now we will take up the budget submission of the 
Office of Compliance. This Office was established by the 
Congressional Accountability Act of 1995. We have with us today 
the Executive Director, Mrs. R. (Ricky) Gaull Silberman, and 
some of her staff members. Welcome.
    There is also a five-member part-time Board of Directors. 
The Chairman of the Board is Mr. Glen Nager; is that correct?
    Mr. Nager. Nager.
    Mr. Walsh. Nager. Welcome, Mr. Nager.
    Mr. Nager. Thank you.
    Mr. Walsh. A Washington attorney-at-law.
    The fiscal year 1998 appropriations bill provided 
$2,479,000 to this Office. The budget before us is $2,286,000, 
a reduction of $193,000. The staffing level is 19 full-time 
equivalent positions. That remains unchanged.
    Does Chairman Nager have a statement? Your prepared 
testimony has been given to the committee, and you may feel 
free to summarize. Welcome, sir.

                         mr. nager's statement

    Mr. Nager. Thank you, Mr. Chairman.
    As Chair of the Board, I am honored to be here today to 
join Mrs. Silberman in presenting the testimony of the Office 
concerning the 1999 budget. I want to take this time just to 
thank the staff and the committee, and particularly Ed Lombard 
and Tom Martin, who have provided enormous assistance to us in 
making the work that our office has done over the first 2 years 
possible, as well as in limiting the appropriations that we 
have requested.
    Much has happened since the act was passed in 1995. The 
provisions of the act have now all taken effect. The Board has 
approved the necessary regulations. The alternative dispute 
resolution process is up and running. The OSHA and ADA 
inspections have been completed; the reports required by the 
statute issued; and the first adjudications by hearing officers 
have been completed, reviewed by the Board and decisions 
issued.
    This record of the Office is a result of the very hard work 
of the four statutory officers and the staff that works for 
them. I would just briefly like to introduce them if the 
chairman will allow.
    Mr. Walsh. Please, feel free.
    Mr. Nager. Jim Stephens is the Deputy Executive Director 
for the House, and Pam Talkin is the Deputy Executive Director 
for the Senate. Beth Brown is our budget officer. And I 
recently appointed a new general counsel to the Office of 
Compliance, Gary Green, who is over there. Mr. Green brings to 
the Board and the Office and the regulated community an 
enormous amount of knowledge, both in regulatory compliance and 
administration of the law. We look forward to his 
contributions.
    Mrs. Silberman is, by statute, responsible for preparation 
and submission of the budget, and I will turn it over to her, 
with the chairman's permission, to present that.
    [The information follows:]

[Page 179--The official Committee record contains additional material here.]


    Mr. Walsh. Please. Welcome.

                       ms. silberman's statement

    Ms. Silberman. Thank you.
    Good morning, Mr. Chairman and Members of the Committee. It 
is a pleasure to be back here again to present the Office's 
1999 budget request. Although in our previous two testimonies 
we have had to rely on conjecture, on guesstimates, if you 
will, because we had no track record and no model, this year's 
submission is based on 2 years' experience with what our actual 
workload is and what it costs to do the job efficiently and 
effectively.
    We are requesting $2.286 million for fiscal year 1999, 
which is a 7 percent decrease from our fiscal year 1998 
appropriation. And that is based on the experience, as well as 
our analysis and evaluation of the programs of the Office.
    As detailed in our submission, the Office's core function, 
and one which Members of this committee have questioned me 
about in the past, is the strictly confidential alternative 
dispute resolution system, which is based on the principle that 
an informed regulated community and early resolutions of 
disputes is most cost-effective and best for employees and 
employing offices. To that end, the Office has provided a 
comprehensive program of education and information, including 
monthly briefings for House employing offices, quarterly 
newsletters which are sent to all legislative branch employees, 
as well as a comprehensive manual for employing offices on 
rights and responsibilities under the Congressional 
Accountability Act.
    We have controlled the costs of this essential function and 
effected considerable savings by taking a cue from this 
committee in establishing good working relationships with the 
Government Printing Office, which does all of our publications 
now.
    The reports attached to this submission for calendar years 
1996 and 1997 on employee use of the Office, which are required 
under section 301(h) of the Act, demonstrate the efficiency and 
the effectiveness of the counseling and mediation processes 
which Congress provided legislative branch employees in the 
CAA. Two full-time counselors on staff have answered more than 
3,000 inquiries and given informal advice and information on 
the procedures of the Office and the rights and protections and 
responsibilities afforded under the CAA to both employees and 
employing offices. It is interesting that of the nearly 1,500 
employees, they have broken down as pretty much half employing 
offices, half employees. And, of the 1,500 employees who have 
contacted the Office over the past 2 years, 250 have filed 
formal requests for counseling.
    Now, after such a request is filed, our counselors evaluate 
the alleged violation, advise the employee of his orher rights 
and responsibilities under the CAA and facilitate dispute resolution. 
The fact that the vast majority of employees who contact our office do 
not initiate formal proceedings is testimony to the effectiveness of 
these counselors. The mediation program has proved similarly effective 
and cost-efficient.
    Early on, we decided that the mediation function was best 
outsourced to recognized, experienced, independent mediators, 
and that is because we wanted to be able to use people as 
needed. And it has worked out to be extremely cost-efficient 
and effective. These mediations, there have been 183 requests 
for mediation, have taken place under Office of Compliance 
auspices, with mediators from such organizations as the Federal 
Mediation and Conciliation Service, the Center for Dispute 
Settlement and JAMS/Endispute, and we have a very high rate of 
settlement.
    However, we want to try and do even better, and we are now 
in the process of ascertaining what conditions create the most 
favorable environment for settlement. One of the things that we 
are trying to encourage, Mr. Chairman and Members of the 
committee, is that principals and decisionmakers attend 
mediations. Up until now that has been kind of hard. The 
lawyers get involved very early, and they want to control the 
mediation process. And we think that is not cost-efficient, and 
that is not the best way to have early settlements. So we are 
looking into ways that we can ensure that principals and, more 
importantly, decisionmakers are present at the mediation so 
that we can have an even better rate of settlement.
    Let me close just very quickly by telling you about a 
letter that I received from an employee. She wrote that the 
Office of Compliance counselor had, and I quote, ``saved her 
life and sanity,'' and that because of the existence of our 
Office, the problem had been solved, her employer had 
participated in the mediation, and she remains happily and 
productively on the job.
    Mr. Chairman and members of the committee, we have resolved 
scores of cases, and each of these represents the realization 
of the promise of the CAA, and I can think of no better 
illustration of the good work of this Office. I will be 
delighted to answer or try to answer whatever questions you 
have.
    Mr. Walsh. Thank you both very much for your testimony. 
That certainly is the kind of result we would love to see as 
often as possible, and congratulations to you for that result.
    [The information follows:]

[Pages 182 - 220--The official Committee record contains additional material here.]


  legislative branch compliance with congressional accountability act

    Mr. Walsh. The primary duties of the Office of Compliance 
are to resolve employee grievances and unfair labor practice 
complaints, conduct health and safety inspections of the 
legislative branch, write regulations, provide education and 
information to the agencies and employees. You also make awards 
and settlements.
    Now that you have had almost 2 years of experience in 
enforcing the Congressional Accountability Act, how do you 
think we are doing? How are we stacking up to these laws and 
regulations?
    Ms. Silberman. I think we are all doing very well. I think 
the Congress is doing very well. One of the reasons why I 
talked about the number of requests for information and how 
evenly balanced those numbers are is that we are finding that 
the congressional employer is seeking information in the way 
that private sector employers do and Federal-sector employers 
do, and we are providing that information, and as a result we 
are getting relatively few complaints.
    In the safety and health area, in the ADA area, the 
Congress, I believe, was very wise in setting up a system 
whereby, for instance, under OSHA and ADA, we do inspections. 
We issue a report. The first report is really basically what 
the state of the play is, what needs to be addressed, and now 
we are in the process of beginning the mandatory inspection, in 
which we will see how well the Architect of the Capitol and 
other responsible employing offices are doing in terms of 
correcting problems that were seen in the first report. And we 
are finding that they are doing pretty well.
    So I would give the Congress a good grade.
    Mr. Walsh. What grade would that be?
    Mr. Hoyer. A good one.
    Ms. Silberman. A good one, a really good grade, Mr. 
Chairman.
    Mr. Walsh. Better than a C?
    Ms. Silberman. Oh, absolutely better than a C.

                             ada compliance

    Mr. Walsh. We have provided the Architect with virtually 
every dollar amount that he has asked for to implement the ADA. 
How would you say the congressional buildings stand in 
compliance with that legislation, with the ADA?
    Ms. Silberman. To follow up on my last answer, there seem 
to be three areas that needed to be addressed that came out of 
our first inspection, and it was the accessibility of 
bathrooms, elevators and entrances. We have just now begun the 
follow-up mandatory inspection, and we have found that 
renovations are under way.
    There has been a vast improvement in something that is 
enormously important, and that is signage. The fact is that 
people with disabilities don't have to make their way around 
the Capitol by using bread crumbs, as some of the rest of us 
have in the past. This is an easy place to get lost in. But the 
general public, as well as the public of people with 
disabilities, I think, are benefiting from a greatly improved 
signage.
    It is hard for me to give you a definitive answer because 
many of these renovations are now in place, but I know that our 
new general counsel has met with the Architect of the Capitol 
and in both--in areas of OSHA, as well as ADA--he is extremely 
cooperative. We are, again, making improvements in getting the 
word down from the top to the supervisors, who often are the 
people that have to really implement these rules and 
regulations.

                             pending cases

    Mr. Walsh. According to our records, there were 158 cases 
of mediation during 1997, plus 10 that were pending at the 
beginning of the year. Then you show 116 closed and 32 pending 
at the end of this year. Why would your pending cases be so 
much higher this year? Is it just a function of the number of 
cases that you dealt with in 1997?
    Ms. Silberman. No. It is actually a function of when those 
cases came in. There is a period of time that it takes for the 
counseling request to be filed, for the counseling to take 
place, for mediation to be scheduled. And actually, that 32 is 
now down to 11. The law is set up so that it takes a certain 
amount of time to get through these things, and they may have 
been and probably were filed towards the end of the year.
    Mr. Walsh. I see.
    Ms. Silberman. It is always an ongoing statistic. It is 
very hard to read our statistics with any degree of 
understanding, without understanding the flow of the process.
    Mr. Walsh. But they are down to 11 now?
    Ms. Silberman. Yes.
    Mr. Walsh. Great. A large number of the cases have gone to 
district court, 57 of them. That seems pretty high.
    Ms. Silberman. That's a perfect example of how statistics 
can be misleading. As you know, cases filed under the 
Congressional Accountability Act are filed by individuals, and 
the vast majority of those 57 cases were filed by one group of 
individuals, in the Architect of the Capitol. It was the result 
of one employment policy.
    It is a group of cases that if we kept our statistics 
differently, would be considered only one. We also have two, I 
believe it is two, individuals who have filed multiple claims, 
which is also quite normal under the administration of these 
laws.
    So it is 57 cases. I would say it probably represents no 
more than 10.
    Mr. Walsh. Individuals?
    Ms. Silberman. In terms of individual actions, policies, 
problems.

                         fy 1999 budget request

    Mr. Walsh. I see.
    Your budget request is down 7 percent, which is to be 
commended.
    Ms. Silberman. Thank you.
    Mr. Walsh. How did you do that?
    Ms. Silberman. Well, a lot of people, I guess, get the 
credit for that. The Congress, as I said, is doing very well in 
complying. Our budget request is based on really taking a hard 
look at our program and, as I said earlier, and looking at the 
aspects of the program which cost the most money and trying to 
see how we can bring those costs down, and I am hoping that we 
will be able to bring the mediation costs down, at least per 
mediation, by having more effective mediation.
    Three of our statutory appointees together represent over 
30 years experience at the head of analogous government 
agencies, and I would venture to say that we have applied our 
expertise and experience in this area in keeping costs down. 
And our staff has been simply terrific. And one of the things 
that we did was we have a very lean staff, and our people 
really function as utility infielders; they fulfill more than 
one function.
     And I think that particular credit needs to go to our 
support staff who are so often the unsung heroes in any 
operation. Our support staff basically perform multiple 
functions, and in that way we are able to keep our personnel 
costs down. For example, we have one administrative assistant 
who also acts as a hearing clerk for the hearing officers.
    And last, but certainly not least, we have Beth Brown, our 
superb administrative officer, who, with her green eye shade 
and the help of people on your committee, keeps us on the 
straight and narrow.
    So we are delighted to be able to come up with a 7 percent 
decrease, Mr. Chairman. Hope to do better next year.
    Mr. Walsh. We will remind you of that.
    Ms. Silberman. You probably will. I knew the minute I said 
that.

            administrative costs paid to library of congress

    Mr. Walsh. The effort is appreciated. It helps us. We have 
a real challenge.
    Lastly, you occupy space at the Library of Congress. Do you 
reimburse them for that space? Are there any other 
administrative costs? If you do, could you provide those to us?
    Ms. Silberman. We certainly will provide the costs to you.
    [The information follows:]

    The total cost of our interagency agreement with the 
Library for the current fiscal year is $48,805. This includes 
the following services: disbursing, payroll (via the National 
Finance Center), security, cleaning, mail, and manual labor. 
Costs are broken down as follows:

Accounting & Travel Services..................................    $5,929
Financial Statements..........................................     5,000
Disbursing (Payments & Petty Cash)............................     2,479
Financial Systems Office......................................     1,891
Budget........................................................     2,025
Information Technology Services...............................     1,823
Personnel/Payroll Assistance..................................     5,502
                    --------------------------------------------------------------
                    ____________________________________________________

        Sub-Total.............................................    24,649
Cost of living increase (2.45%/9 month).......................       453
Benefits @ 22%................................................     5,522
National Finance Center.......................................     2,073
Facility Services.............................................    10,130
                    --------------------------------------------------------------
                    ____________________________________________________

        Sub-Total.............................................    42,827
LOC Overhead @ 13.96%.........................................     5,978
                    ==============================================================
                    ____________________________________________________
            Total OOC Costs...................................    48,805

    Ms. Silberman. We do not reimburse them for the space per 
se. We do have what Beth tells me is a cross-serving contract 
in which they supply for us budget and personnel, support 
services, as well as security, cleaning and the rest of it. I 
must say that we are very happy with the situation. It is 
working very well, and the only time we have a little problem 
is that there is a certain uncertainty with respect to the 
permanence of the arrangement.
    Mr. Walsh. The physical location?
    Ms. Silberman. Yes, exactly. And, you know, that is the way 
it was set up.
    Mr. Walsh. Staff informs me that we are trying to be 
helpful to you there.
    Ms. Silberman. They are, as always, very helpful.
    Mr. Walsh. Good. Thank you. Any other questions?
    Mr. Serrano.

                        mr. serrano's questions

    Mr. Serrano. Just very briefly, you were very happy to 
announce, if I heard you correctly, there are very few 
complaints; it is a low number?
    Ms. Silberman. I think it is a relatively low number.
    Mr. Serrano. Is that related, do you think, to the fact 
that, as you also said, people were calling in kind of a 
preventive way to get information on how to deal with 
situations? It is not that there is a lack of information----
    Ms. Silberman. No.
    Mr. Serrano [continuing]. Of where the people could go?
    Ms. Silberman. No, absolutely not. As I have testified 
before, you know, we send out brochures to the residences of 
every employee. We publish a quarterly newsletter, which I hope 
that you all get a chance to see. You know, we supply constant 
information, and our phones are ringing. I mean, it is not that 
we are not supplying that information. We do briefings.
    I think the system is just working well, I really do, Mr. 
Serrano. It was predicated to be front-loaded on information, 
to have a mechanism whereby you would have early resolution of 
disputes. The whole mediation program itself is a model that 
the Congress has provided itself and that most Federal agencies 
don't have, and most private sector firms don't have.
    The reason that I took this job to begin with is that I am 
a firm believer in the importance of mediation in these kinds 
of disputes, and we are proving the point.
    Mr. Serrano. Thank you. I have no further questions.
    Mr. Walsh. Mr. Fazio.

                         MR. FAZIO'S QUESTIONS

    Mr. Fazio. Mr. Chairman, thank you.
    I wondered if we had any way of gauging the amount of media 
interest in the work of your group? Do you have any contacts? I 
notice you keep thorough records on all sorts of contacts with 
you.
    Ms. Silberman. From my experience, it has been relatively 
little.
    Mr. Fazio. I think initially there was a great deal of 
interest----
    Ms. Silberman. Yes.
    Mr. Fazio [continuing]. On the part of the media.
    Ms. Silberman. Initially there was, but lately it has been 
less.
    Mr. Fazio. I guess that relates probably to the fact that 
things are going so well?
    Ms. Silberman. I hope so. I hope so.
    Mr. Fazio. My sense is, and I think Mr. Hoyer noted this, 
that really most of the problems here relate not so much to 
Member offices as to the institutional offices?
    Ms. Silberman. That is absolutely right.
    Mr. Fazio. Do you think that is another reason why the 
press is not interested?
    Ms. Silberman. Absolutely.
    Mr. Fazio. Okay.
    Mr. Walsh. Are you leading the witness, Mr. Fazio?
    Ms. Silberman. He is leading me exactly where I want to go, 
Mr. Chairman. That is just fine.
    Mr. Fazio. I wanted to encourage her to go there.
    I don't know whether we have any press interest in this 
today, but I think it was frankly oversold, overblown, as a way 
of getting at a problem that obviously isn't as endemic as 
people thought about this institution. You know, I hope, 
because, you know, any time you have good news, it is not news. 
Somebody ought to come back and do a retrospective.
    Ms. Silberman. We have been trying to encourage that.
    Mr. Fazio. A feature on these things. Maybe they ought to 
come and see what the Office is doing.
    If anybody is here from Roll Call?
    Ms. Silberman. Well, in past years there has been, but I 
don't know that there is this year.
    Mr. Fazio. Well, I guess we have wasted our time here. 
Sorry I bothered to engage you. I do have a question for the 
record.
    [A question from Mr. Fazio and response follows:]

    Question. Has the Office of Compliance undertaken any 
review of Member and Committee office compliance with 
provisions of the Fair Labor Standards Act (FLSA), i.e, the 
process of designating Member and Committee staff as either 
covered or exempt from FLSA, and the keeping of time records 
and payment of overtime if staff are covered? If not, why not? 
If not, does the Compliance Board plan any type of review in 
the future? If not, why not?
    Response. The CAA does not authorize the Office to 
undertake generalized compliance investigations to determine 
whether employing offices correctly claim exempt status for 
bona fide administrative, professional, and executive employees 
or whether overtime work is being properly compensated. As the 
Board of Directors explained in adopting the substantive 
regulations, the CAA does not apply all the rights and 
protections of the FLSA to the Legislative Branch. Among those 
provisions not applied were the various enforcement powers 
exercised by the Department of Labor, including the authority 
under section 11 of the FLSA (29 U.S.C. Sec. 211) to conduct 
investigations and inspections of the workplace. Similarly, the 
CAA did not apply the recordkeeping provisions, although the 
Board has acknowledged that recordkeeping ``may well be in 
employers' interests both as a sound personnel practice and in 
order to defend against subsequent litigation.'' Notice of 
Proposed Rulemaking, 141 Cong. Rec. S17603-04 (Daily ed. Nov. 
28, 1995). Given the absence of statutory authority, the Office 
does not contemplate undertaking these kinds of compliance 
inspections or reviews suggested by the question.
    The Office is empowered to respond to specific employee 
inquiries and complaints as to employing office compliance with 
the FLSA and the other federal labor and employment laws made 
applicable under the CAA. Under the three-stage dispute 
resolution process, an employee has the opportunity to present 
for independent determination and resolution issues such as 
whether an employing office has properly exempted an employee 
under the FLSA or whether an employing office has properly paid 
overtime compensation.

    Mr. Walsh. Thank you for your constructive comments and 
questions.
    Mr. Hoyer.

                          MR. HOYER'S COMMENTS

    Mr. Hoyer. Well, I would like to join in Mr. Fazio's very 
cogent observations with reference to what the press is 
interested in and what it is not interested in, and I am 
enthusiastic about press-bashing right now.
    But there were a number of agendas as it related to the 
creation of this Office, one of which I will say cynically had 
little to do with institutional compliance as it had to do with 
elimination of the regulatory laws and the attempt to prove 
that if applied to the Congress, that they would be found to be 
unworkable.
    As I understand your testimony, it is the opposite, and 
that the institution is, in fact, complying with ADA, OSHA. 
There obviously is still a way to go. You obviously still don't 
have total funding, but I was pleased, and that is what Vic 
mentioned, when I looked at 152 formal requests for counseling, 
out of the 152, Mr. Chairman, only eight were from the House 
Members' offices and four from the Senate Members' offices. So 
12, or less than 10 percent, were out of Members' offices.
    Of the 501, you don't have it broken down, of employee 
contacts for information--I can't judge that. Maybe you don't 
have that information, but I, like Mr. Fazio and Mr. Serrano, 
and I am sure Mr. Walsh and this subcommittee, am pleased, that 
we are finding both a willingness and, in fact, accomplishment 
of compliance so that our employees and those who use our 
facilities and who come to the center of democracy in this 
Nation have the full protections that are accorded to others.
    That was the premise of the adoption of this. I don't know 
whether there was anybody who was opposed to it. Was it 
unanimous or were there one or two or three?
    Mr. Fazio. That may not reflect the true feeling.
    Mr. Hoyer. Chris Shays and I worked very hard on this, and 
he did a lot of work. I think it is good information that we 
are proceeding, and, of course, the fact that there is not 
great press interest would imply that things are going pretty 
well, and good news is not news. So maybe the fact that Roll 
Call isn't here sends us a message as well.
    Thank you, Mr. Chairman.
    Mr. Walsh. Thank you, Mr. Hoyer. And thank you all for 
attending the hearing today. And all the witnesses, thank you 
for your patience in waiting for your turn.
    We will now adjourn for the day. The next hearing will be 
Tuesday, February 3rd, at 1:00 p.m., at which time we will take 
up the Financial Manager's Council and the Library of Congress. 
The meeting is adjourned.
                                         Tuesday, February 3, 1998.

             LEGISLATIVE BRANCH FINANCIAL MANAGERS COUNCIL

                               WITNESSES

RICHARD BROWN, DEPUTY ASSISTANT COMPTROLLER GENERAL FOR OPERATIONS, 
    U.S. GENERAL ACCOUNTING OFFICE
JOHN WEBSTER, DIRECTOR, FINANCIAL SERVICES, LIBRARY OF CONGRESS
    Mr. Walsh. The hearing will now come to order. I would like 
to welcome my colleague and friend, Congressman Serrano, and 
all the others who have come to attend the hearing today. We 
will now take up the Financial Managers Council. This is a new 
entity that was formally recognized in the Fiscal Year 1998 
appropriations bill. Section 307 of the bill authorizes the 
expenditure of up to $1,500 of participating agency funds to be 
allocated to the Council for administrative needs, and by all 
accounts, this has been money very well spent.
    A little background. In 1996, in consultation with the 
Appropriations Committees, a group of agency financial officers 
banded together to form the Legislative Branch Financial 
Managers Council. Their goal was to improve financial 
management throughout the legislative branch. Such an 
undertaking is truly needed.
    The legislative branch does not have an umbrella 
organization comparable to what the Office of Management and 
Budget provides for the executive. OMB is the President's 
policy and procedure arm. In the absence of that function, this 
subcommittee, together with our Senate counterpart, has 
attempted in the past to provide a limited amount of policy and 
procedural guidance.
    For example, the legislative branch telecommunications 
effort was instituted under the authority enacted in the 
legislation appropriations bill. This came after extensive 
hearings and investigations that were patterned after what the 
executive branch was contemplating with the FTS 2000 project. 
Another endeavor was the committee urging the use of 
standardized payroll systems in consolidated administrative 
service centers, such as the National Finance Center.
    In the executive branch, OMB oversees the utilization and 
implementation of these initiatives. It has fallen to this 
subcommittee to be the legislative branch impetus for getting 
the agencies within our funding jurisdiction into these 
programs. It is fair to say, though, our ability to do this is 
limited, so we look with favor on the council's initiatives.
    I would like to welcome the Co-Chairmen of the Legislative 
Branch Financial Managers Council, Mr. Richard Brown of the 
General Accounting Office, Deputy Assistant Comptroller for 
Operations; and Mr. John Webster, Director of Financial 
Services, at the Library of Congress. As is customary, we place 
your biographies in the record at this point.
    [The information follows:]

                     U.S. GENERAL ACCOUNTING OFFICE

                            Richard L. Brown

                               Biography
    Mr. Brown is the Deputy Assistant Comptroller General for 
Operations and the Controller for the U.S. General Accounting Office. 
He began his federal career in 1967 as a Revenue Officer with the 
Internal Revenue Service. Before joining GAO as the Assistant Budget 
Officer in 1974, he served as a Budget and Management Analyst in the 
Navy's Strategic Systems Project Office for six years.
    Mr. Brown, a certified Government Financial Manager, was appointed 
GAO's Controller in 1977. He was appointed Director of the Office of 
General Services and Controller in 1978, having responsibility for 
managing and directing GAO's support operations--including facilities, 
property management and supplies, procurement, finance, travel, and 
safety and security.
    Mr. Brown is a Cum Laude graduate of Weber State College where he 
received a B.A. degree in 1966. He has completed post graduate work at 
a number of universities including the University of Maryland, the 
National Law Center at George Washington University, American 
University, Princeton and Harvard. Mr. Brown received GAO's Meritorious 
Service Award, and he received the rank of Meritorious Executive in 
both 1982 and 1987. He also received GAO's Distinguished Service Award, 
and in 1996, the agency's highest award, the Comptroller General's 
Award. Also, in 1992, he was given government-wide recognition when he 
received the Excellence in Administration Award sponsored by the 
General Services Administration.
                               __________

                          LIBRARY OF CONGRESS

                            John D. Webster

                               Biography
    Mr. Webster is the Director of Financial Services at the Library of 
Congress. He was appointed to that position in November 1989 and is 
responsible for budget, accounting, financial systems, and disbursing 
functions. During his tenure with the Library, he has received the 
Librarian's award for Meritorious Service for his work in improving 
financial management.
    Previously, Mr. Webster worked for 14 years with the Office of 
Personnel Management (OPM) in a number of positions associated with 
Government-wide benefits programs. His last position with OPM was 
Deputy Assistant Director for Financial Control and Management, with 
responsibility for accounting, budget, management information, quality 
assurance, and administrative services for the Retirement and Insurance 
Group. He received the Director's award for Distinguished Service at 
OPM for improving the financial management of the benefit systems.
    Before joining the Federal Government in 1975, Mr. Webster was a 
senior accountant with Haskins & Sells, where he specialized in C.P.A. 
audits and systems development for public and private corporations.
    Mr. Webster has also received the Department of the Treasury's 
award for Distinction in Payments Management in 1990 for his work in 
improving the cash management of the Federal Employees' Health Benefits 
system and the Achievement of the year Award in 1997 from the 
Association of Government Accountants' Washington Chapter for improving 
the Library's financial management.
    Mr. Webster is a Certified Public Accountant and Certified 
Government Financial Manager. He also passed the Certified Internal 
Auditor examination in August 1980. He holds a bachelor of science 
degree in accounting from the University of Maryland. He has taught 
accounting and auditing courses at the Northern Virginia Community 
College and Howard County Community College in Columbia, Maryland. Mr. 
Webster is a member of the Washington Chapter of the Association of 
Government Accountants (AGA) and the American Institute of Certified 
Public Accountants. Mr. Webster has also been a member of AGA's 
national Finance and Budget Committee for the past 3 years.
    Mr. Walsh. We have your prepared remarks, and if you would 
like to proceed and summarize, we would be happy to entertain 
your comments. Thank you for your time.
    Mr. Brown. Thank you, Mr. Chairman. If it is all right, I 
would like to take a minute to introduce some of the Council 
members that are with us today.
    Mr. Walsh. Sure.
    Mr. Brown. We have Stuart Pregnall from the Architect of 
the Capitol; Bruce Holmberg from the Capitol Police; Beth 
Hughes Brown from Office of Compliance; Polly Hodges from the 
Congressional Budget Office; Bill Guy and Bruce Holstein from 
the Government Printing Office; Frank Derville from the House 
Finance Office; and John Lainhart, the Inspector General for 
the House, who are all participants in the Council.
    Mr. Walsh. It is good to have all of you here. Thank you.

                            LBFMC Activities

    Mr. Brown. With your permission, Mr. Chairman, I would like 
to briefly summarize some of the Council's activities for the 
last year and then perhaps Mr. Webster could briefly outline 
what the plan is for the coming year. The Council is a 
voluntary organization, which as you mentioned, was established 
in October of '96 to promote more efficient and effective 
financial management practices in the legislative branch.
    To date, all of the members of the Council have agreed to 
adopt a vision and goals statement of the Council, and we have, 
on several occasions, been asked to provide assistance and 
counsel to several legislative branch entities on various 
matters. For example, we have been asked to provide some 
consultation and assistance to the Architect as they have 
considered a new financial management system and have begun 
dealing with some year 2000 compliance issues. We have also met 
with some of the staff of the Senate Rules Committee to discuss 
with them the implementation of a new financial management 
system in the Senate, as well as their compliance with year 
2000 issues.
    We have also initiated some discussions with the Capitol 
Police to help them explore some cross-servicing arrangements 
for a financial management system that would comply with 
Federal standards and permit them to get in a position of 
producing auditable financial statements.
    Last year, we held three general sessions of the Council, 
where we discussed the implementation of Federal managerial 
cost accounting standards, the current capabilities of the 
client server environment as it relates to Federal financial 
systems, and opportunities for cross-servicing and system 
sharing to meet the needs of system expansion and replacements 
in the legislative branch.
    We also have addressed some issues regarding the year 2000 
compliance with each of our members and we reviewed some of the 
best practices for planning and experiencing successful 
financial statement audits. With that, Mr. Chairman, I will let 
Mr. Webster tell you what we will be doing in the coming year.
    Mr. Webster. Thank you, Mr. Chairman. The Council plans to 
devote most of its attention in the next two fiscal years 
towards reviewing best practices that will help us ensure year 
2000 compliance for financial systems, continuing the effort we 
started in the previous year; exchanging information and 
sharing ideas for improving financial operations; and preparing 
auditable financial statements for each legislative branch 
entity.
    I would like to reiterate Mr. Brown's point that the 
Council is voluntarily working together to improve financial 
management of the legislative branch. The Council is very 
appreciative of the Committee's support and asks for your 
continued help in Fiscal Year 1999. We and other members of the 
Council are available to answer any questions.
    [The information follows:]

[Pages 231 - 238--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you for the brevity of your statements. 
It's welcome, it is refreshing, and we will try to do the same. 
The staff has told me over and again what an important role you 
provide and how helpful you have been in every area, and, you 
know, indeed providing the sort of guidance OMB does for the 
executive branch.

                      architect's financial system

    Last year, and you mentioned this, we asked you to review 
the plans of the Architect to adapt their internal accounting 
system so it would be year 2000 compatible and improve its 
budgetary controls. The group cautioned that the end result 
would be a general ledger accounting system that would not be 
compliant with Federal standards.
    As a result, the Architect redirected his efforts to 
eliminate the noncompliance problem. We appreciate the 
cooperation of the Architect's Office on that also. Have you 
followed up with the Architect's Office to determine how the 
project is going and is it fair to say they will meet Federal 
standards.
    Mr. Brown. We have not had the occasion to go back and 
discuss this specifically with the Architect's Office. However, 
at our last meeting, Mr. Pregnall reported on their progress 
and indicated in that report that they are now on a track that 
looks like they will be year 2000 compliant and have addressed 
many of the problems that they originally had been struggling 
with. So based upon that report, it looks like they are on the 
right track.
    Mr. Walsh. Do you leave it at that or do you sit down and 
review the steps that have been made.
    Mr. Brown. In our last meeting with the Architect, he 
indicated that he would probably be inviting us to come back 
and counsel with him further at a future time, so we stand 
ready whenever that invitation comes to provide him any 
assistance that we can.

                   standard general ledger accounting

    Mr. Walsh. Can you give us any specific suggestions at 
where the agencies need to improve their financial management 
systems?
    Mr. Webster. Mr. Chairman, all members of the Council are 
working toward a common set of goals. One of the key goals is 
the implementation of standard general ledger accounting. SGL 
accounting will provide a common language, which will permit 
the preparation of consolidated financial statements and make 
it easier to share systems within the legislative branch. Six 
agencies have already implemented SGL accounting and three 
agencies are taking steps to do that right now. Implementing 
SGL accounting is one of the key suggestions for improvement.
    Mr. Walsh. What are the three agencies that need to take 
those steps?
    Mr. Webster. The Architect of the Capitol, Government 
Printing Office and the Senate.

                        common financial system

    Mr. Walsh. Do you think it is realistic for the legislative 
branch to have that goal of a common financial management 
system?
    Mr. Webster. A goal of the Council is to prepare 
consolidated financial statements and to have a consolidated 
audit. Another goal is to operate integrated financial systems 
that may be shared among legislative agencies. Those are both 
goals included in our vision and goals statement. We think 
those goals can be reached. Although, I might add, that while 
one financial system may be possible, it may not be desirable 
in all cases because of some of the varying requirements of 
individual agencies. I think the key, again, is to implement 
one common language, that is a standard general ledger 
language, that will permit legislative branch agencies to work 
together to meet these goals.
    Mr. Walsh. Anything else you would like to add before I 
turn it over to Mr. Serrano? Congressman Serrano.
    Mr. Serrano. Very briefly. You spoke about the next 2 years 
and what you intend to do. What do you envision will be the 
needs during that period, and secondly, I am a little confused 
about the whole issue of how we got to so many different 
accounting practices. How did that happen, that we have so many 
different ones?
    Mr. Webster. Let me take the second part first, Mr. 
Serrano. It is not unusual, in the Federal Government, to have 
a number of different financial systems, and that is very 
prevalent in the executive branch. Actually, the legislative 
branch has more common systems, I think, than the executive 
branch, which is really in large part due to the help of this 
committee and a push toward one common payroll system a number 
of years ago and also financial systems. A lot of the agencies 
already have some common system already in-place.
    The executive branch has realized, as well as us, too, that 
it is more cost-effective to use administrative support centers 
where agencies can share systems at a reduced cost. I think 
that is something that we are working toward in the legislative 
branch. I will defer to Mr. Brown for the first part of your 
question.
    Mr. Brown. Let me try on the first part of your question. I 
believe that if we are able to move closer to a common language 
in all of our systems and produce a consolidated set of 
financial statements, then we can have one audit for the 
legislative branch, instead of eight or nine, this will not 
only save money, but it will also save mischief. It will enable 
us to report along with the rest of the government that we are 
in compliance with the Chief Financial Officers Act and that 
the legislative branch complies with the standards that have 
been adopted by the rest of the government.
    Mr. Serrano. Thank you.
    Mr. Walsh. Mr. Cunningham, welcome. Do you have any 
questions of the witnesses?

                           consolidated audit

    Mr. Cunningham. Just one. When you said one audit, can you 
do that with nine different agencies? Are you going to be 
comparing at apples to apples? You know, each one has a couple 
different areas which they would look at. Is that feasible, to 
have one audit?
    Mr. Brown. We believe it is. We believe if the agencies all 
have a common base in their systems, then we can produce a 
consolidated set of financial statements. We would assume that 
each agency, then, would produce auditable statements, that 
could be rolled up into a set of consolidated statements that 
would be subject to one audit. Through sampling techniques and 
other methods, the auditors could be satisfied as to whatever 
they need to be satisfied with during that audit.
    Mr. Cunningham. Thank you, Mr. Chairman.
    Mr. Walsh. Thank you. Any further questions of the 
witnesses? In that case, then, we will allow you to take your 
leave and thank you very much for your efforts in helping us to 
get to common financial practices and records I think it will 
be to the benefit of the legislative branch. I would like to 
insert a question for the record at this point.
    [A question from Mr. Walsh and response follow:]

    Question. What would the benefit be if we were to achieve 
these objectives?
    Response. A single consolidated financial statement and 
audit would save money in several ways. One set of auditors 
instead of a different auditor for each agency would save money 
by eliminating multiple procurements. The auditors would also 
have a different materiality level with a consolidated audit 
resulting in the reduction of the number of small items that 
are evaluated. Finally, because many legislative agencies use 
the same payroll and financial system, the auditors and agency 
would save time and costs of multiple reviews of the systems by 
different auditors. In addition to dollar savings, a single 
consolidated financial statement and audit would contribute to 
an informed Congress and assure the public that Legislative 
Branch assets are being safeguarded, financial results are 
reported accurately, and laws and regulations are being 
complied with.

    Mr. Brown. Thank you, Mr. Chairman.
    Mr. Webster. Thank you.
    Mr. Serrano. Thank you.
                                         Tuesday, February 3, 1998.

                          LIBRARY OF CONGRESS

                               WITNESSES

JAMES H. BILLINGTON, THE LIBRARIAN OF CONGRESS
DONALD L. SCOTT, DEPUTY LIBRARIAN OF CONGRESS
WINSTON TABB, ASSOCIATE LIBRARIAN FOR LIBRARY SERVICES
RUBENS MEDINA, LAW LIBRARY
JO ANN C. JENKINS, CHIEF OF STAFF, OFFICE OF THE LIBRARIAN
LLOYD A. PAULS, ASSOCIATE LIBRARIAN FOR HUMAN RESOURCES
ELIZABETH ZAIC, ACTING DIRECTOR, INTEGRATED SUPPORT SERVICES
KENNETH E. LOPEZ, DIRECTOR OF SECURITY
HERBERT S. BECKER, DIRECTOR, INFORMATION TECHNOLOGY SERVICES
MARYBETH PETERS, REGISTER OF COPYRIGHTS
DANIEL P. MULHOLLAN, DIRECTOR, CONGRESSIONAL RESEARCH SERVICE
FRANK KURT CYLKE, DIRECTOR, NATIONAL LIBRARY SERVICE FOR THE BLIND AND 
    PHYSICALLY HANDICAPPED
JOHN D. WEBSTER, DIRECTOR, FINANCIAL SERVICES
KATHY A. WILLIAMS, BUDGET OFFICER

                            opening remarks

    Mr. Walsh. We will now take up the Library of Congress. And 
give them a moment to take their seats.
    Dr. Billington, welcome.
    Dr. Billington. Thank you, sir.
    Mr. Walsh. General Scott, welcome to you. We have before us 
the Librarian of Congress, Dr. James H. Billington, and we also 
welcome retired General Donald L. Scott, Deputy Librarian of 
Congress.

                             budget request

    Mr. Walsh. The 1999 budget of the Library assumes total 
funds available will be $527.5 million, from a variety of 
sources, including appropriated funds, receipts, gifts, trusts, 
and revolving funds, and the reimbursable program. Funding 
requests before the committee today are $397 million, an 
increase of $19.8 million or 5.25 percent over the current 
level.
    This level of resources includes $27.7 million in 
offsetting collections. The Library is requesting an additional 
42 positions above the current FTE level of 4,275. An 
additional 338 FTEs are supported from other sources. Dr. 
Billington, would you like to introduce members of your staff?
    Dr. Billington. Thank you, Mr. Chairman.
    Mr. Walsh. Maybe you can withhold for just a moment and we 
will get some folks in and close the door.
    Are you ready to proceed? Dr. Billington.
    Dr. Billington. I think the only three members of our staff 
who have not previously been introduced to the committee are 
Elizabeth Zaic, the Acting Director of Integrated Support 
Services; Kenneth Lopez, our Director of Security; and, 
finally, Kathy Williams, our Budget Officer. General Scott and 
myself and the rest of the people you met before.
    Mr. Walsh. Welcome to all.
    Dr. Billington. Should I continue?
    Mr. Walsh. We have your statement. If you would like to 
summarize or proceed, feel free.

                         librarian's statement

    Dr. Billington. Very briefly, Mr. Chairman, thank you. I 
would like to highlight just a few points from the full 
statement, before showing the committee a short video, and then 
be followed by General Scott. The Library of Congress is a 
totally unique institution, as you are aware, with a mission 
that is both national and moral.
    As the Library of Congress, it has a national mission to 
serve the first branch of the government of a free people. And 
it has the moral mission of facilitating the creative use of 
the world's knowledge for the good of our Nation.
    The problem in our time is that the very nature of the 
collections is changing. Knowledge is increasingly being 
generated and communicated in electronic and ephemeral form. 
And with the growing flood of unsorted electronic information 
available today, the Congress and the Nation needs a trusted 
knowledge navigator--the Library of Congress--more than ever, 
to help sustain our knowledge-based democracy.
    Our public culture, Mr. Chairman, is in danger of moving 
back down the evolutionary chain from knowledge to information 
and from information to miscellaneous raw data--and perhaps 
just to an unsorted and an ungrammatical stream of 
consciousness. We may be sinking down, rather than rising up to 
those twin peaks of wisdom and creativity, that are created on 
top of knowledge, and are the source of vitality and dynamism 
in a democracy.
    To sustain our knowledge-based democracy in this 
information inundated world, the Library of Congress has to 
collect, preserve, make secure and accessible this rapidly 
emerging, often confusing electronic universe, while still 
protecting intellectual property rights and at the same time 
continuing to collect and service non-electronic materials, 
whose volume is also paradoxically increasing even at this 
time.
    This makes a set of daunting challenges, and we are very 
much in need of the committee's continued support, including 
funding mandatory pay raises and unavoidable price level 
increases, and, also, $2 million for the replacement of 
personal computers that will not work after the year 2000, ifwe 
are to make this change without eroding what we have already done, and 
impeding our transition to an increasingly electronic world.

                          library bicentennial

    Dr. Billington. We celebrated the 100th anniversary of the 
Thomas Jefferson Building last year, so magnificently restored 
by the grace and support of this committee long years ago and 
through many years. We inaugurated the Library's Bicentennial 
efforts, which will dramatize the essential role that the 
Library of Congress and all libraries play in keeping democracy 
dynamic. The Bicentennial efforts are being carried out almost 
entirely by private funds.
    We are doing more for more people with 12 percent fewer 
staff than in 1992 and are enormously grateful for the 
committee's support, particularly for the Integrated Library 
System last year, which is a platform on which all further 
progress will be based. I ask the committee's support so the 
Library may head into the 21st Century with expanded digital 
holdings and with the systems in place to maximize service to 
the Congress and to all Americans in the localities where they 
live across the Nation. This is truly an exciting new frontier.
    Mr. Chairman, each of you has a packet of material 
providing further information about the Library, and we have a 
short video to give the committee a quick look at the real 
progress we are making in our electronic services to the 
Congress and to the Nation. This, I assure you, will not take 
long and then with your permission, General Scott will add some 
details.
    [The prepared statement of Dr. Billington follows:]
    [Video shown. Outline of video follows:]

[Pages 246 - 279--The official Committee record contains additional material here.]


    Mr. Walsh. General Scott.

                      deputy librarian's statement

    General Scott. Thank you, Mr. Chairman, for the opportunity 
to appear with Dr. Billington to present our 1999 budget 
request.
    The committee's approval of our fiscal year 1997 and our 
fiscal year 1998 funding levels allowed the Library to make 
some important gains. It strengthened our management practices, 
and it really is helping us to perform and prepare our work 
force to perform more efficiently for the new millennium.
    Mr. Chairman and members of this committee, I would like 
just to take a few moments to highlight a few of those 
accomplishments.

                             strategic plan

    Inspired by Dr. Billington's vision, we finalized our 
strategic plan up to the year 2004. As you saw in the video, we 
increased the Library's capacity to make numerous products 
electronically available, and we are pleased that the first 
release of the Legislative Information System is dramatically 
improving the communication between the Congress and between 
the other legislative agencies.
    We also completed facilitative leadership training for 560 
managers and supervisors throughout the Library. This has 
helped to achieve better results, and it has also helped to 
improve the work environment. We currently have a 1-day course 
for staff to teach them the same successful collaborative 
techniques.

                            financial audit

    In the area of financial management, we are very pleased, 
and we are very proud to announce that the Library received its 
first ever ``clean'' audit opinion on our consolidated 
financial statements from an independent audit agency. We also 
cut the arrearage by another 1 million items.
    In short, Mr. Chairman, we realized several goals last year 
that really helped our management practices and will improve 
and modernize the services we render to the Congress and to the 
American people. As Dr. Billington pointed out, we continue to 
need your help in order to continue to move forward.

                         priority budget items

    Included in this budget are five items that we think are 
critical to that continued progress. First and foremost, we 
have put as the highest priority an initiative that will ensure 
that all of our computers and automation systems are Year 2000-
compliant. The Integrated Library System, which your committee 
approved for us last year, will provide a computer platform 
that is Year 2000-compliant. That system, which is scheduled to 
be installed by the 1st of October, 1999, will improve our 
collections security, will help with our inventory controls, 
and will improve our processes throughout the Library.
    The Integrated Library System project team is currently 
reviewing responses to our request for proposals and will 
present next month an implementation plan for congressional 
approval prior to us going out to purchase that system.
    To complete our Year 2000-compliant needs, we are asking in 
this budget $2 million to purchase new personal computers, 
computers that will replace computers that we now have that are 
not Year 2000-compliant.
    We have four other items that we are asking for that we 
think are very important. For security, we are asking for $2.5 
million to fund key elements of our security plan. In the area 
of off-site storage, we are asking for $1.3 million to begin 
operations at two off-site collections storage facilities. And 
for talking books, we are asking for $1,250,000. That will 
purchase 5,000 additional talking book machines for the blind 
and physically handicapped.
    Finally, in the area of congressional staff succession, we 
are asking for $872,000 for the Congressional Research Service 
to support a succession plan that will help to maintain the 
high continuity level of service that our Congressional 
Research Service is providing to the Congress now.

                          mandatory increases

    In total, Mr. Chairman, we are requesting a 6.5 percent net 
increase, or $22.4 million, 57 percent or $12.9 million of 
which is required for mandatory wage and priceincreases, which 
is once again the largest item in our budget request.
    Further details are in Dr. Billington's formal statement 
and in our budget justifications. My colleagues and I will 
welcome any questions you might have.
    Mr. Walsh. Thank you very much, gentlemen.
    There are five appropriation accounts that provide the 
primary funding for the Library of Congress. CRS, $68.5 
million. Salaries and expenses, $239.4 million, of which $6.5 
million is offset by receipts from cataloging sales; Copyright, 
$35.3 million, of which $21.17 million is collected from 
receipts and fees; books for the blind and physically 
handicapped, $48.1 million; furniture and furnishings, $5.7 
million. The salaries and expenses budget is the backbone of 
your agency, as you noted. The book purchase budget, cataloging 
and reference and reading room funding are all funded by this 
$239 million appropriation. You are still reporting a 
cataloging backlog.
    [Questions from Chairman Walsh and responses follow:]

                         Price Level Increases

    Question. With the low inflation of the past several years, 
we have to question the need for $2.6 million for higher prices 
for the goods and services you purchase from outside vendors. 
Are your procurement people getting the best prices?
    Response. The Library's procurement staff is following 
Federal procurement practices (detailed in the Federal 
Acquisition Regulation) to ensure full and open competition to 
get the best prices for goods and services we purchase from 
outside vendors. Procurement specialists rely upon several 
practices to assure best value. Among these are: competition 
through industry poll; recommendations/suggestions from 
customers' initial research; automated procurement reports; 
vendor catalogs; market surveys; personal contacts; 
professional experience; and specialists are trained in cost/
price analysis.
    Question. General Scott, I'm sure you understand the 
necessity to control price level increases. Will you make an 
effort to review these price level budgets to see if they can 
be reduced? Please report what you find back to the committee.
    Response. We have reviewed the amount of price level 
increases requested in our budget. The total price levels, 
$2,618,420, represents a 2.2% increase over the total fiscal 
1998 non-personals base. The fiscal 1999 CPI, as published as 
an Economic Assumption in the Budget of the United States, 
Fiscal Year 1999, is also 2.2%. Results of the review are 
explained in two parts: first, the purchase of books, 
subscriptions, and overseas field offices; and second, all of 
the remaining non-personals categories. Historically, inflation 
rates related to the purchase of Library materials and overseas 
operations have exceeded CPI rates--these cost categories, for 
fiscal 1999, increase by 7.5% (equating to $1,037,300). For the 
remaining non-personals cost categories, the overall price 
level request is 1.5% (equating to $1,581,120) of the fiscal 
1998 base. The original OMB published guidance (July 1997) 
specified a 2.6% increase for non-personals. OMB revised that 
guidance, in December 1997, to 2.0%. Based upon an examination 
of economic factors, inflation rates for library materials and 
overseas activities, and OMB guidance, the review indicates 
that the Library's non-personals price level increases are 
reasonable and within the guidelines used by other Federal 
agencies.

                Number of Indefinite/Temporary Employees

    Question. Using the format of Table II in your budget 
justification, provide a breakout of the number of indefinite/
temporary employees included in the FTE column on page 3.
    Response. The tabular material is attached.

[Page 283--The official Committee record contains additional material here.]


                               arrearage

    Mr. Walsh. How many of the 113 million item holdings have 
yet to be cataloged into the collections?
    Dr. Billington. We have about 20 million holdings not yet 
cataloged.
    Mr. Walsh. Twenty million?
    Dr. Billington. Yes, having reduced it by 20 million over 
the last 6 years, since we started this effort with the 
committee's encouragement and support; we are halfway through 
clearing the arrearages.
    Mr. Walsh. How much of this budget goes toward reducing 
those arrearages, and how much headway do you expect to make 
this year?
    Dr. Billington. Well, you can't disassociate the arrearage 
effort from the overall cataloging budget because the whole 
process of cataloging includes cataloging the arrearages. But 
the total amount is about $52.5 million. All of that is as 
involved in arrearage clearance, as it is in general 
cataloging. The exact targets I am not sure of.
    Winston, what are the exact targets for this year?
    Mr. Tabb. We will be----
    Mr. Walsh.  State your name for the record.
    Mr. Tabb. I'm sorry, Winston Tabb, Associate Librarian.
    We will be having at least 500 of our people working on 
planning for implementation of the Integrated Library System 
this year. We are now soliciting volunteers. When we have them, 
we will determine what impact their ILS planning work will have 
on the arrearage reduction goals for this year, and we will let 
the committee know that as part of our plan when we come 
forward with the request for release of ILS funds.
    Dr. Billington. I think there will probably be a slight 
decrease--the numbers for arrearage reduction won't be as great 
as in recent years simply because many of the same people are 
required to help structure the ILS implementation, but in the 
long run, the gains are going to be much greater because the 
ILS will permit a much more efficient clearing of arrearages. 
That will be just one of many benefits. But until we have that 
plan, we can't give you an exact number at this point. We 
expect progress to continue, but not at as high a level as it 
was initially, although in the long run there will be a sharp 
upturn.
    Mr. Walsh. You don't expect, even though you slow down and 
clean up those arrearages this year, you don't expect to be 
further behind next year?
    Dr. Billington. We don't expect to get behind. Of course, 
all of this is net in the sense that we are keeping up with 
current inflow, which has been quite considerable, as you will 
note, in recent years.
    We are making our target, thanks to this committee's 
support, and Mr. Fazio's strong leadership. He was championing 
this effort at an early date, before it was generally realized 
in the Congress how important this was, and of course the 
clearing of the arrearages has brought a great many materials 
to light that we didn't know we had--not only to users here in 
Washington but through the National Digital Library to people 
throughout the country. So it is really an important project.
    I might point out that we set a record, an all-time record 
of cataloging books last year. Nearly 290,000 books were 
cataloged. We have 20 percent less staff than we had 8years 
ago, though we are getting 20 percent more productivity. So the 
investment in this and also the investment in bibliographic work 
stations, and cooperative and copy cataloging and a number of things 
the committee has long been cooperatively working on with us and urging 
us to do have brought some measurable dividends.
    Questions from Chairman Walsh and responses follow:]
                               Cataloging
    Question. Where are these uncataloged items stored? Are they 
completely inaccessible if they are not cataloged?
    Response. Uncataloged items are stored in secured areas in the 
Jefferson, Adams, and Madison buildings, and at Landover, Maryland. 
Uncataloged and in-process items are accessible to staff and to 
Congress. They can also be served to patrons by special arrangement, 
unless such service would be unduly labor-intensive (i.e., costly) or 
present an unacceptable security risk.
    Question. How much is in this budget to do the cataloging and to 
what extent will this budget reduce the backlog?
    Response. The Library is requesting no additional funds in the 
fiscal year 1999 budget for cataloging. The Library's base includes 
approximately $52.5 million to support cataloging, which is inseparable 
from the arrearage project.
    The Library is currently assessing the likely impact of Integrated 
Library System (ILS) planning and implementation on its ability to 
reduce the uncataloged backlog in the next two fiscal years and will 
provide this analysis to the Committee in March, as required in last 
year's House report on our appropriation.
                            tabular material
    Question. For the record, update the customary tabulations on 
annual cataloging statistics and acquisition/collection data.
    Response.
    [The information follows:]

[Pages 286 - 294--The official Committee record contains additional material here.]


    Mr. Walsh. That is good to hear.

                            off-site storage

    Regarding off-site storage, this budget presumes the 
construction of the off-site storage facility at Fort Meade, 
that it will be completed next year. When do you expect to 
occupy that facility?
    General Scott. We expect to occupy that facility by the end 
of fiscal year 1999.
    Mr. Walsh. Your budget indicates you plan to contract out 
the operation of the storage facility. Existing facilities at 
Harvard and the University of Texas utilize part-time employees 
who are university students or otherwise in need of this kind 
of work; it helps reduce cost and is a good part-time job for 
those who need such work. Will a contractor supply that kind of 
staffing? If not, will you look at that possibility of staffing 
that new facility yourselves?
    General Scott. Yes, sir. Our approach to staffing that 
facility is to go out and seek contractor bids. Once we get 
those bids, we will compare the cost of contractors to in-house 
staffing. Our choice will be made depending on which is the 
most cost-effective.
    Mr. Walsh. So you have a range of options, both in terms of 
who will staff and the cost of staffing, and----
    General Scott. Yes, sir.
    Mr. Walsh. Is there an in-house option or not?
    General Scott. We will look at an in-house option, along 
with the contractor bid, and make the determination as to which 
is most cost-effective and go with the best one.
    Mr. Walsh. Do you foresee the need for any additional 
modules?
    General Scott. In our strategic plan, we have other modules 
that we have planned. We have module number two, which is 
mostly for books, and that is planned--we would like to occupy 
that module in fiscal year 2001. Modules three and four, 
planned to hold books and non-books, would be occupied in year 
2003. Then module five, if needed, we would want to occupy that 
in the year 2005.

               national audio-visual conservation center

    Mr. Walsh. Let's turn to the audio-visual conservation 
center, for the preservation and accessing the Library's film 
and sound recording collection. For the benefit of those 
Members who have not been briefed on this, can you explain the 
legislation enacted late last session that authorized 
acquisition of the Culpeper facility, because it was sort ofa 
last minute arrangement that came down in the last week of the session, 
the last day, perhaps, of the session?
    Dr. Billington. Public Law 105-144 authorizes the Architect 
of the Capitol to acquire the Culpeper property for use by the 
Library, as a national audio-visual conservation center and 
also mandates that the expenditure of the funds be done through 
appropriations, with a prior approval of the Library's 
oversight committees.
    The facility has 140,000 square feet on 41 acres, 20 of 
which are available for expansion. As you know, it is the 
former site of the Federal Reserve of Richmond, Virginia for 
storage of money. It has deep vaults which have ideal 
configurations in many respects for storing our audio-visual 
properties, which have been scattered around in a variety of 
places where we are paying to lease space. This situation has 
not only been expensive but it has been hard on the materials 
because they have to be carted around, brought to Washington, 
and constantly loaded and unloaded to be brought to different 
locations. These sites are widely dispersed in several 
different places, ranging from Suitland, MD, which we have to 
vacate this year, to the Wright Patterson Air Force Base in 
Ohio, and so forth. The facilities are also becoming antiquated 
and would have required a lot of additional maintenance.
    We were fortunate enough to get a private donor to put up 
the money for this purchase. The arrangement, as it stands now, 
just to bring you up to date on it--since the law was signed by 
the President, on December 15.
    The Library is not authorized to take title to facilities 
like this, so we have been working together with the donor and 
the Architect of the Capitol to do the following things: First 
of all, the environmental assessment of the property was 
completed on January 20, just a few days ago, and showed no 
surprises. A due diligence assessment in conjunction with the 
Architect of the Capitol, has been started and will be 
completed by the end of February, and will look at all of the 
structural, mechanical and electrical systems, the 
waterproofing, and other things, in order to ensure 
satisfactory condition of the building prior to the transfer of 
property to the donor, which we expect on April 1st of 1998.
    Meanwhile, we are developing a master plan in conjunction 
with the Architect of the Capitol, which should be completed in 
May of 1998, which scopes out the overall project prior to 
proceeding with renovation and design.
    The transfer of the property from the donor to the 
Architect of the Capitol is planned for 1999. So we are on 
track with a good procedure. We are blessed with a very 
generous, helpful donor, and very good cooperation from the 
Architect of the Capitol. We have, you know, 770,000 reels of 
film. We have the world's largest collection of movies and of 
sound recordings, something like 2.4 million sound recordings, 
and immense amounts of television tape. We have a mandate 
dating back to 1976 to create a national archive in the radio 
and television area.
    We have this immense amount of material that has been 
widely scattered. It is going to be better preserved, it is 
going to be more usable, and it is, in the long run, going to 
be more economical to maintain because it will be in one place 
and we won't have all these various leasing arrangements and 
expenses we currently have. We are already getting a reduction 
as we phase Suitland out.
    We expect, by the way, to begin storing some non-nitrate 
film immediately this next summer. This is very important 
because summer is always a difficult time. What we found in our 
congressionally-mandated study of film preservation a couple of 
years ago is that the most important thing for film is the 
storage conditions and not so much the quality of the material. 
Probably everything we have in the Library, at least since 
1850, in almost any format, is degrading at some speed or 
another. So storage conditions become increasingly important if 
we are going to preserve the national heritage and the Culpeper 
facility gives us a consolidated place. There will be a lot of 
interchangeable values in having all the audio-visual items in 
one place. We expect there also to be a back-up place for 
digital storage, which will become increasingly important.
    Mr. Walsh. The intent was to use donated funds for the 
acquisition of the facility and the renovation. Do you still 
anticipate being able to do that?
    Dr. Billington. Yes, sir. We hope to. We have, of course, 
gotten off to a very good start there. We hope to do it 
primarily, though not exclusively, with donated funds. We hope 
that the basic carrying and maintenance costs will be carried 
on the Federal side, but that the heavy capital investment, 
particularly the nitrate storage vaults--which are going to be 
the major new expense--will mostly be on the private side. This 
is a heavy fundraising burden, but we have been able to do it 
with the National Digital Library. We hope we can accomplish 
this, even though we have one of the smallest development 
staffs of any cultural institution--even those half our size. 
But we hope we will be able to do that.
    Mr. Walsh. Lastly, then I will go to Mr. Serrano, we would 
like to see a renovation operations funding plan developed for 
the program. Do you plan to prepare such a plan?
    Dr. Billington. I am sorry?
    Mr. Walsh. The subcommittee would like to see a renovation/
operations funding plan.
    Dr. Billington. That is what we hope to get done by early 
this summer and we will get that to you. That is on the 
schedule. In fact, it is a master plan we are working on with 
the Architect of the Capitol. We hope to have it done by May, 
and we will of course immediately get it to the committee.
    [Questions from Chairman Walsh and responses follow:]

               national audio-visual conservation center

    Question. You consulted with the Architect of the Capitol 
on prospective renovation needs of the facility in Culpeper, 
Virginia. The AOC will be responsible for whatever 
rehabilitation or construction is necessary. Have you seen any 
AOC building renovation plans and construction documents? What 
is the status of the activity?
    Response. The Library, Architect of the Capitol and the 
Packard Foundation are working as a team to advance the 
development of the National Audio-Visual Conservation Center. 
The initial study for the facility, an Environmental Site 
Assessment, has been completed. Work is in progress on a Due-
Diligence Analysis of the existing infrastructure of the 
building. Work will begin shortly on an overall Master Plan for 
the entire developmental project, which will not only include 
renovation of the existing building but also include the 
construction of the Nitrate Conservation Laboratory and the 
Nitrate Storage Vaults. The team expects the consulting 
architect to start the actual design of the existing building 
renovation during June, 1998.
    Question. You also planned a high ratio of private/public 
funding for operational costs. What is your goal for that 
ratio? Does this budget reflect that policy?
    Response. The Library is proposing the same 3-1 private/
public funding ratio for the Culpeper project as the Congress 
approved for the National Digital Library program.

    Mr. Walsh. Mr. Serrano.
    Mr. Serrano. Thank you.

                       off-site storage locations

    Dr. Billington, in addition to the sites you just 
mentioned, how many sites do you have and what kinds of 
materials are stored in those sites? I mean, is there an order 
to what is stored at different places, or do all the sites have 
an array of different items?
    Dr. Billington. There are a variety of sites. Of course, 
one of the beauties of the Fort Meade location is that it will 
concentrate the book and print materials, largely, in one 
storage place. The Culpeper site will deal with the audio-
visual materials.
    At the moment, we are much more widely diffused. We have a 
lot of material in Landover, where the Library has a large 
warehouse. There is a significant amount of material in 
Suitland. There are films in caves in Boyers, 
Pennsylvania.There is the Wright-Patterson Air Force Base, where we run 
the only full-time, nonprofit film preservation facility in the 
country. The nitrate film storage is largely there, but not 
exclusively; some of it is in Suitland. So currently we have a widely 
disbursed set of locations, and we hope to really consolidate almost 
all collections in two sites, each within easy driving distance of 
Washington. Fort Meade, of course, is less than an hour from 
Washington. It is only about an hour and a half to Culpeper and 
reachable on main roads. So there will be a much more consolidated--and 
efficient means to store, preserve and retrieve materials.
    Mr. Serrano. Your intent is eventually to have those two as 
the only sites?
    Dr. Billington. I would hope, yes. For instance, General 
Scott outlined the four modules at Fort Meade. If there is need 
of a fifth one, we think that could probably be absorbed at 
Culpeper because Culpeper will take care of our needs until 
well into the next century. It is 140,000 square feet of 
building on 41 acres. Twenty acres can be used for further 
development. Nitrate film was not something they could 
accommodate at Fort Meade so we had to be on the lookout for 
another place to deal with that eventuality.
    But this committee has been very helpful in taking a real 
interest in this problem for us, and helping us. Fort Meade we 
owe entirely to the committee. We are very grateful for your 
support and understanding on the need for the Culpeper facility 
which came up very suddenly, because the Federal Reserve was 
going to transfer it elsewhere. If we hadn't moved very 
rapidly, thanks to the Congress, we would have been in trouble.

                     OTHER LIBRARY OFFICE LOCATIONS

    I should mention also the Taylor Street facility, which is 
where the entire operation of the Blind and Physically 
Handicapped Library is located. This operation provides such a 
wonderful service, with 780,000 clients and 23 million items 
distributed, in cooperation with the Postal Service and with 
local institutions.
    The NLS/BPH facility functions very well and is in good 
shape, but we rather hope we might be able to consolidate it 
with the Library at some point.
    Let's see if I missed anything. Oh, yes, I am sorry, the 
Market Square Annex, which houses the FEDLINK reimbursable 
program. That is a program where we do consolidated purchasing, 
on a reimbursable basis, for 1,300 Federal libraries, saving 
Federal agencies more than $9 million annually.
    The Taylor Street Annex is here in the District, as is the 
Market Square Annex for the reimbursable programs that we run, 
so this will represent something of a consolidation, and we 
hope with the reconfigurations that are going on now that the 
building is fully operative here, we will be able to bring you 
a little more on Capitol Hill at the same time.
    [Questions from Chairman Walsh and responses follow:]

                     leased space at taylor street

    Question. You occupy space at the Taylor Street building. 
How much space do you have at Taylor Street?
    Response. We lease about 105,000 square feet from GSA. This 
includes nearly 83,000 in office space and 22,000 in roof 
parking.
    Question. That space is rented through GSA from a private 
landlord. How much does it cost to lease, provide security, and 
other costs associated with renting space outside of the main 
Library buildings?
    Response. The fiscal 1999 amount budgeted for the rental of 
space at Taylor Street is $1.8 million. The Library's costs for 
security there are estimated at $76,000.

                           child care center

    Question. Please describe the operation and costs 
associated with running the Library's child care facility. How 
many children and families are served? Do we have congressional 
staff members children in attendance? If so, how many staff 
members take advantage of this service . . . on a daily basis 
and on a monthly basis? Are the children of House or Senate 
members or staff served at this facility and, if so, what 
percentage of the total numbers do they constitute?
    Response. The Library of Congress entered into a Memorandum 
of Understanding (MOU) with the Library of Congress Child Care 
Association (LCCCA), a recognized employee organization of the 
Library, on June 2, 1994. The LCCCA is a corporation 
incorporated in the District of Columbia under the District's 
Nonprofit Corporation Act. LCCCA was granted 501(c)(3) status 
by the Internal Revenue Service on August 31, 1992. The MOU 
exercises authority granted under the Trible Amendment and P.L. 
101-520. The Library appointed an official to act as liaison 
between the Library and the LCCCA. The Liaison is the Library's 
representative to the LCCCA and a non-voting observer of the 
activities of the LCCCA, the Center and its Board of Directors.
    The Little Scholars Child Development Center, located at 
601 East Capitol Street, operates from 7:15 a.m. to 6:15 p.m., 
Monday through Friday, excluding Federal holidays and the day 
after Thanksgiving. Children in age ranging from 3 months to 5 
years are accepted. Tuition for each age group varies from 
$624-$800 monthly. Based on availability of funds, tuition 
assistance may be given for up to 50 percent of the biweekly 
costs for those who qualify.
    The direct costs paid by the Library of Congress for fiscal 
1997 were $140,850. Indirect costs--staff time for Liaison and 
Library staff--are estimated at $77,180. This does not include 
support provided by the Architect of the Capitol and LCCCA 
costs (e.g., teachers' salaries).
    Children of House and Senate members/staff represent 35.2 
percent of all attendees. As noted below, 30 of the 85 
attendees are children of congressional members or staff. This 
figure includes two children of a Member of Congress. All 
attend on a monthly basis. As of February 1998, the following 
table depicts the distribution of children and families served:

                                                                        
------------------------------------------------------------------------
                                                     Children   Families
------------------------------------------------------------------------
Library...........................................         13         12
Senate............................................         15         13
House.............................................         15         11
Other Govt........................................         16         14
Public............................................         26         23
                                                   ---------------------
      Total.......................................         85         73
------------------------------------------------------------------------

                           Film Preservation

    Mr. Serrano. Dr. Billington, you mentioned restoration. Was 
that film restoration?
    Dr. Billington. Film----
    General Scott. Preservation?
    Mr. Serrano. Yes, film preservation. I see a lot of 
programs on TV where they are selling all kinds of gimmicks on 
AMC and other channels to preserve films. Do you get any help 
from the movie industry or from some of the relatives of the 
people whose films you would like to preserve, or is that--does 
the Government pick up that tab all by itself?
    Dr. Billington. We haven't had as much help from the film 
industry as one would like, but they have taken a greater 
interest in film preservation in recent years. A couple of 
years ago, we were urged to define national standards for 
archival quality preservation, which we have done.
    If you define it in terms of really rigorous preservation 
of the original artifact in enduring form, rather than just 
putting it in a can in an air conditioned room--which is an 
improvement. We have probably done something like two-thirds or 
three-quarters of the archival quality film preservation ever 
done in this country. A few other laboratories, a few other 
places like UCLA, the Museum of Modern Art in New York, the 
Eastman House in Rochester, have also contributed to this 
effort.
    We have found that Congress is concerned about this, and 
approved a National Film Preservation Foundation. We would very 
much welcome Congress' and the committee's support in the 
dialogue we hope to have with the film industry to get their 
fuller participation.
    The studios take some interest in their own films but the 
main problem is the so-called orphan films.
    Mr. Serrano. They take interest in what they can show on 
TV.
    How am I doing on time, Mr. Chairman?
    Mr. Walsh. You have lots.
    Mr. Serrano. But you hear horror stories like three Chaplin 
films that have disappeared, they don't exist anymore. Does 
that mean you have a copy of them?
    Dr. Billington. Eighty-one percent of all silent films have 
disappeared forever. We are dealing only with 19 percent, 
almost all of which have been restored by the Library of 
Congress, including the entire paper print collection. We have 
the only copy of many of these--it is a very dramatic story. 
Only until recent years has anybody cared--the studios largely 
discarded their silent films when they went over to sound films 
in the early 1930's.
    I mean, for instance, much of the Harold Lloyd corpus was 
rediscovered in a landfill in permafrost in the Yukon in 
Canada. Fortunately, it was well preserved because it was 
really cold--the preservation standards call for cold 
temperatures, and they had it in spades up there. But that is 
hardly an ideal preservation mode.
    The American Film Institute played an important role at the 
beginning in locating a lot of these films and getting them in 
the Library of Congress. Only in 1972 did the Library get 
copyright deposit for films, so we had to assemble a 
retrospective collection with a lot of help.
    But the actual work, the physical work of preserving these 
films, is done by 20 heroic people at the Wright-Patterson Air 
Force Base, who are preserving America's film heritage. The 
American taxpayer is helping with this. Also, to some extent 
the Arts Endowment has provided money for the other studios and 
centers: UCLA, the Museum of Modern Art, Eastman House, and 
some other smaller places in Wisconsin and a few others which 
do a small amount.
    But the great majority of films made are already lost or 
disintegrated--it is sort of a losing battle against time. 
Nitrate films, as you know, disintegrate into gunpowder. That 
is why it cannot be stored on Capitol Hill; we have to store 
nitrate film in bunkers at Wright-Patterson Air Force Base.
    This is a major problem. The Congress has been absolutely 
pioneering, first of all, in supporting film preservation as a 
national need, and second, in creating, now, mechanisms that we 
hope will involve the industry more actively in archival 
quality preservation as distinguished from simply reformatting 
films for television, where the industry has an obvious 
economic interest.

                              preservation

    Question. The preservation budget is $10.9 million. This 
program includes binding some documents to protect them, 
microfilming, digitizing, and advising the custodial divisions 
on how to handle the collections in order to minimize damage 
and deterioration. This is the program that is also 
experimenting with methods for removing acid from books. Acid 
paper is especially short-lived and the Library has been 
conducting a deacidification research program for many years. 
The current method of choice apparently is the ``Bookkeeper'' 
process. Please outline that process and the degree to which 
the Library is using Bookkeeper to deacidify the collections.
    Response. Bookkeeper is a liquid-base mass deacidification 
technology that neutralizes the acid in paper by impregnating 
it with magnesium oxide particles. The process meets the 
Library's technical requirements for extending the useful life 
of books without causing any undesirable side-effects or 
endangering staff, Library patrons, or the environment. The 
Library's plan, approved by the Committee last summer, calls 
for deacidifying at least 236,400 books during the next four 
years under a newly-awarded contract using the Bookkeeper 
process. Production incentives built into the contract will 
enable us to treat almost 40,000 additional books at no cost to 
the government if we are successful in our efforts to encourage 
other libraries to deacidify books using the Bookkeeper 
process.

                            deacidification

    Question. How much is in this budget for deacidification? 
How will it be used?
    Response. The Library is requesting no additional funds in 
the fiscal year 1999 budget for mass deacidification. The 
budget base includes about $4.5 million in ``no-year'' funding. 
The Committee previously provided the authority, under a ``no-
year'' appropriation, to expend these funds for deacidification 
over the next four years. The funds will be used to deacidify 
books from the Library's general, law, and special collections.
    Question. What are your long range plans for using any mass 
production process?
    Response. The Library views mass deacidification as one of 
several useful options for preservation, along with such 
treatments as conservation, microfilming, boxing, and binding. 
The Committee's approval of the Library's Mass Deacidification 
Action Plan now enables us to integrate deacidification into 
our preservation program as a standard preservation activity. 
The choice of which preservation treatment to use depends on a 
number of factors, including cost, condition, and potential use 
of the item. Deacidification is currently one of the cheapest 
preservation options. It costs about $15 to process and 
deacidify a book, $135 to microfilm that same book. We will use 
this mass preservation process as long as there are acidic, 
endangered materials in our collections for which 
deacidification is the appropriate option--that is for the 
foreseeable future. Through Commerce Business Daily 
announcements, we have continued to encourage other companies 
with deacidification technologies, capable of mass treatment, 
to come forward if their processes have the potential to meet 
or exceed the Library's technical requirements.

    Mr. Serrano. Mr. Chairman, I don't know, and I don't have 
all the information I should have on how much we have done on 
this, but certainly maybe in the future, this Congress, in the 
near future, could look at prodding the film industry somehow 
to become a partner, so the taxpayer does not pick all of this 
up.
    This is a cultural tragedy that we are running into in this 
country, that a lot of our artwork, if you will, is just 
disintegrating and has disappeared. The film industry now is 
making more money than ever before. They should be thinking a 
little bit about pumping some money in preserving the work of 
those that have come before them, and many of those are real 
gems.
    I don't want to prolong this. I just want to ask you a 
couple of more quick questions here.

                          cataloging arrearage

    Mr. Serrano. You said you had 20 million items in arrears 
that you had not catalogued yet?
    Dr. Billington. Yes.
    Mr. Serrano. So the question----
    Dr. Billington. Approximately. Probably a little less by 
now.
    Mr. Serrano. 20,550,000. Will you ever catch up? Can you 
catch up? You are dealing with this large amount. We are 
certainly producing a lot in this country. If you just keep up 
with that every year, will you ever catch up on the 20 million 
you have not catalogued?
    Dr. Billington. Well, we have reduced that by half while 
still keeping up with an increased flood of materials. I just 
cannot stress and praise too highly the work that our 
catalogers have done. There were nearly 1,200--1,181 people, I 
believe--that we had in 1991, and we have only 900 now working 
in this area. As I say, they are cataloging much more than 
before.
    That has been partly the result of a move we have made over 
10 years from a kind of assembly-line approach to a whole-book 
team approach, with the use of SWAT teams. In addition, the use 
of new kinds of minimal level batch cataloging, the use of copy 
cataloging, and the use of cooperative cataloging with other 
institutions has increased productivity. It has become a much 
more networked and cooperative activity.
    There is a great deal more being done by others, which 
helps us in turn, but the clearing of arrearages is, by and 
large, clearing unique things that only this Library has.
    Our entire bibliographic record is on-line and available to 
anybody with a computer and a modem. What we are really doing 
is bringing things that were largely unknown, not just to a few 
readers in the reading rooms here, but to the attention of the 
whole country. So it is an exciting prospect.
    I think we will continue to make progress. The Integrated 
Library System that you were kind enough to enable us to launch 
last year will assist with this effort. Our original target was 
to clear 80 percent of arrearages, and we hope to reach that. 
We may be a little more delayed because of one thing or 
another, but we are pretty well settling in and making steady 
progress. We expect to continue to make progress.
    Mr. Serrano. One last question. I will try to make the 
question brief. I appreciate the same thing in the answer, 
because it could be a long answer.
    You paint a good and a real picture of an exciting place 
for the Library of Congress. You paint a great picture for a 
very rosy future. But when you sit around, is there something 
pending out there that scares you to death about something that 
you will face, that the Library could face in the next few 
years, in the next generation, that if we don't deal with early 
on--I keep thinking of the New York City subway system. 
Everybody sat around and said it is the best system in the 
world, they did nothing to face the future, and then we went 
through a period when everybody was complaining about it and 
what a big mess it was. They said, what happened? Well, when it 
was great, no one planned for the day that it may not be great.

               impact of potential large-scale retirement

    Dr. Billington. I will have one thing to say and then turn 
it over to General Scott. The one thing that I would say is, my 
big fear is that we will not replace the depth and quality of 
the people we have working with these collections; that we will 
simply take it for granted, not realizing they are getting 
older and a lot are going to choose to retire. We are going to 
have a very heavy retirement problem.
    General Scott can fill you in on some of the details on 
this. But we have people throughout the Library, and in the 
Congressional Research Service, with many, many years of 
experience. Not only are we concerned that they will retire, 
but that they will retire without having transmitted the 
knowledge they have to another generation. Almost everything in 
the Library of Congress is unique--the size, the dimensions, 
the depth of the collections, the singularity of the kinds of 
requests that the Congress makes and is going to be making even 
more in the future. All of that results in highly learned 
knowledge that you can't easily replace; or farm out; you can't 
simply recruit somebody from a university campus.
    The Library expanded a lot right after the war, and then it 
had another big burst when Congress wanted to beef up its 
support efforts in the early seventies. A lot of staff hired 
then are eligible to retire. My big fear is that we will wake 
up one day and suddenly realize we have all this material but 
we don't have the people who are the intermediaries. The more 
of this material you acquire, the more important it is to have 
the people who can understand it.
    So we have a massive job in training a whole new 
generation. We have to not only replace the knowledge we have, 
we have to make sure that it is combined with knowledge and 
familiarity with electronic technology. We are looking for the 
knowledge navigators of the future. It is going to have to be 
somebody who can handle electronics but also know substantive 
material, so they can be a navigator. They will know 
navigational skills, but they will also have to know what the 
ocean is like.
    Another big fear is that we will just take the people for 
granted and we won't replace them, train them, develop them, 
and bring along the next generation.
    There are also fears of not being able to maintain service. 
General Scott probably has some other thoughts on this.
    General Scott. No. Just to amplify Dr. Billington's 
concerns, I would say that bringing along the next generation 
is the greatest challenge facing the Library of Congress within 
the next 3 to 5 years. Forty-five percent of our work force 
will be eligible to retire. Many--and CRS has identified about 
60 of those special employees who have such knowledge, that if 
they were to leave without us having an orchestrated, well-
coordinated plan, it could cause some serious damage to the 
quality of the service.
    On the other side, in Library Services, there are another 
30 or so curatorial kinds of positions that have been 
identified that are very special, one of a kind. That is not to 
say that the other individuals are not important, but we are 
just focused on the ones who we believe we have to make special 
arrangements to accommodate their leaving. So I would agree 
with Dr. Billington, that that is the greatest challenge I 
think we face.
    Mr. Serrano. Thank you.
    Thank you, Mr. Chairman.
    Mr. Walsh. Mr. Cunningham.

               providing information--not interpretation

    Mr. Cunningham. Thank you, Mr. Chairman.
    I think most Members on both sides of the aisle support 
what you are doing, trying to open up the Library of Congress 
to the general public, especially in our education systems.
    I have one real concern in that. Dale Kildee, a Democrat, 
was Chairman of the Education Subcommittee, a very good friend 
of mine. Then I was his chairman after we took the Majority. 
But the both of us together killed history standards, mainly 
because the history standards were written by some left-wing 
liberal college professors that wanted to rewrite history, and 
that were teaching more about McCarthyism and Madonna than they 
were the Magna Carta.
    Are there any protections that are going in so that people 
don't rewrite history in these things? Like the Enola Gay at 
the Smithsonian. We got that rascal responsible for that fired. 
But those kinds of things scare me when we, you know, compile 
history. There is a group that says Thanksgiving was an evil 
plot, a mean-spirited plot when it was established--rewriting 
history. Are there any protections that are going into what you 
have in the Library?
    Dr. Billington. Let me----
    Mr. Cunningham. I don't want to preclude first amendment 
rights.
    Dr. Billington. No. First of all, we are getting a great 
deal of American history out to the schools and libraries and 
homes of America. What we are providing are the most 
interesting and important documents--the primary documents of 
American history. We are not telling people how to teach it or 
how to interpret it. We are just getting the records out.
    Mr. Cunningham. Just giving the information?
    Dr. Billington. So people can use it themselves.
    We do have summer institutes. These have been privately 
funded by the Kellogg Foundation and others, and bring in 
teachers who discuss among themselves and develop their own 
curricular ideas on-line, so that it can be shared with other 
teachers. But this is, we think, kind of the way to go--let 
them determine how they teach. There are going to be a lot of 
different ways that this material is used.
    But our job is not to prescribe curriculum or even 
predetermine what use will be made of this. This is what 
libraries have always done, provide access to books that 
disagree with each other; allowing them to sit next to one 
another on the shelves, and serve people who disagree with one 
another who may sit next to each other.
    Mr. Cunningham. I think that is very healthy. All I am 
saying is directing--taking this and giving a fire hose in a 
certain direction would be just----
    Dr. Billington. We are not sending out curricular packages. 
The private sector and the individual school districts and 
different groups will use this material in a hundred different 
ways, the way they use books and magazines that they find in 
the library.
    Mr. Cunningham. I would oppose national standards or 
anything like that to come out of the Library of Congress. I 
don't need a long answer on it.

            impact of an ever-increasing internet-user base

    The second thing was, did you ever see the movie "Zulu"? It 
is where the British were being overrun by the Zulus. There 
were just millions of them coming over the mountain, and there 
is a single guy that hands out all the ammunition. In the old 
system, you had to sign for every piece of ammunition. Here the 
British are, literally getting overrun. They are in the 
trenches. There are millions of Zulus descending. And this guy 
was still making the Brish soldiers fill out the vouchers for 
them--this actually happened--for a package of ammunition. So 
finally they shot the guy and just took the ammunition.
    Dr. Billington. I think we are in the General's territory.
    Mr. Cunningham. I saw SWAT teams referred to in your 
testimony, and I thought of the Library.
    The reason I ask it is, I see where now you are getting 
over 2 million requests a day on the Internet. I have a bill 
that is expanding the availability of technology in schools, 
that the President signed in the balanced budget. It is called 
the 21st Century Classrooms Act, where private institutions can 
donate computers to the schools. Frequently, the computers are 
not available to the schools in the right format of software 
and so on. So donors can go through the Detweiler Foundation, 
which is a nonprofit. They use prison and brig labor to upgrade 
the computers, they put them in the school, and many of the 
donors, through the provisions of my bill, get an expanded 
write-off for it.
    The next step is this: I am working with Bill Archer on 
Ways and Means to do the same kind of thing for libraries 
across the Nation. Because if you have got a welfare system and 
you don't have enough training where are people going to go to 
upgrade their skills, especially on a high-tech level, they 
won't be able to move above being dish washers, car washers, 
whatever.
    Now, is that going to give you, at the Library, with this 
wave of new people, extra work, if we upgrade our libraries 
with computers and the Internet and hook into your system? Is 
that going to be counterproductive for you, with all your 
tasks?
    General Scott. I would say it wouldn't be 
counterproductive, depending on what demands were placed on us, 
but we have to figure out what kind of additional people, if 
any, we would have to bring on board to help that effort.
    Mr. Cunningham. Mainly they would dial in on the Internet 
and so on, which is not producing additional work for you. 
Where is, say, a single mother off welfare going to go if she 
can't get the job training? The library is one of the answers.
    I think if we upgrade our libraries and our colleges and 
our local places, it is the best thing we can do to help solve 
that problem. I think the Federal Government can play an 
important part in that.
    Dr. Billington. The more people use the material we are 
digitizing, the better. That is the whole point of digitizing. 
It is not like having just one copy of a book and then having 
five copies of the book and then you break down if you have to 
have 10 copies of the book.
    Once it is digitized, once it is on-line, the magic of the 
Internet takes over an we realize the benefits of the new 
technologies through accelerated speed of delivery and 
simultaneous use by unlimited numbers of people. We always are 
mindful of a theoretical breaking point on the system. For 
instance, take the Thomas system. From September of 1996 to 
September of 1997, the usage on that system nearly quadrupled: 
from about 2.6 million usages a month to 10.2. Now, that is an 
exponential increase; we are seeing this growth in the use of 
our on-line material. So far, you know, we have been able to 
handle it. We don't see any apocalypse emerging on the scene, 
as long as we get into the third millennium.

                          year 2000 challenge

    The General has pretty well disciplined us about the year 
2000 challenge as the ultimate bunker that we have to make sure 
we can scale. The committee has been very helpful, helping us 
do that. So there are energies being focused on that. But, 
basically, the amazing thing is the amount of traffic that can 
be handled; the important thing is that the material is good 
material, that it is solid. What we are doing is setting a 
standard of quality for the Internet so that people don't get 
transfixed by the negatives, that they have a positive 
alternative.
    The same thing happened at the end of the 19th century when 
the Library of Congress assumed responsibility for cataloging 
standards, the way in which print material was recorded. Many 
people were using the Dewey system, but there was a lot of 
chaos and it was not adequate for the size and complexity of 
materials. So too we are now trying to establish content 
standards. There are a lot of spin-off benefits to this 
investment that we are making in getting good material out.
    As long as we are getting good material out, it is our hope 
that it will be used by everybody, used by more and more 
people.
    Mr. Cunningham. I don't want to belabor my time. Thank you.
    General Scott. That is a challenge we would like to work 
with you on.
    Mr. Cunningham. I will work with you on that. Maybe I can 
get you support for that. That could be good for the country.
    Mr. Billington. We are going to need more people to answer 
these inquiries. What you are going to get from the very 
success of providing information and getting an increased 
clientele is the need for more staff. People are going to have 
follow-on questions. Mr. Becker behind me has to put all of 
these needs together.
    Mr. Cunningham. I have to step outside. I have another 
constituent out there. I apologize. I am trying to run here and 
have people come in at the same time.
    Dr. Billington. The short answer is yes, we hope it will do 
it. It won't take that many more people, but it will take some, 
and more resources as well.
    Mr. Cunningham. Thank you.
    Mr. Walsh. Thank you, Mr. Cunningham.
    Mr. Fazio.

                        national digital library

    Mr. Fazio. Thank you, Mr. Chairman. It is good to see 
everyone from the Library here, my old friends and increasingly 
a large number of new ones.
    I would like to follow up on some of Mr. Cunningham's 
questions with regard to the National Digital Library project. 
I saw, as we all did, some commentary on American Memory, but I 
am wondering, what generally have you been hearing as the 
reaction to the effort to digitize the Library?
    Dr. Billington. Well, we are hearing pretty good things. I 
mean, people like it. They are stimulated by it. Very often the 
kids are ahead of the teachers in using it, because they are 
familiar with Nintendo games, and then they stumble on us. And 
more and more people are using the NDL with homework 
assignments. It is beginning to get into the classrooms as well 
as the libraries.
    Mr. Fazio. They can go directly, instead of through their 
Members of Congress, to CRS?
    Mr. Walsh. We are not ready to talk about that yet.
    Dr. Billington. Another interesting thing that has happened 
to the Library has been spreading the knowledge and use of our 
digitized collections. We have a $2 million grant from 
Ameritech, specifically to digitize collections not in the 
Library. We have 10 other institutions that are digitizing 
their materials with money that we have raised for them; it is 
a national competition. And even people who lose, who have a 
proposal to digitize interesting things they think people would 
be interested in--even the people who lose get critiques on 
their proposal, which are reviewed both technically and 
substantively. So we are helping prime the pump in a lot of 
other places--so the word is getting around.
    I think it is really all positive. We have had a lot of 
awards, and I don't want to talk about them, but we have 
itemized them in one of the handouts.
    Mr. Fazio. I saw that listed. You have received a lot of 
honors for your Web site.
    General Scott. Just an anecdote: There is a report that I 
can give you that would give you some feedback. I think it was 
last year, I had not been here that long, but the Library of 
Congress hosted a group of teachers from all across the 
country, and as part of their agenda, they saw an American 
Memory spot, and several of them--and I won't say what State 
they were from, but they were known to be very critical of the 
way the Government spent money----
    Mr. Fazio. It could have been any one of 50.
    General Scott. Yes. But they came up, there were several 
standing around in a little cluster, and one of them looked and 
came up and said, ``You know, if this is the way my government 
is spending money, then, by God, I don't mind paying my 
taxes.'' So I thought that was just a resolute pat on the back.
    Mr. Fazio. It is a good day to remember that particular 
anecdote.
    Are there any problems? It can't all be wine and roses. 
There must be some things we have learned that we might not 
have anticipated, maybe some things we have attempted to solve. 
We are trying to be, I am sure,self-critical as we go through 
this, but there must be some people who have asked for something 
different than we are serving. Does anything come to mind?
    Dr. Billington. We have been running this thing on a kind 
of feedback basis. We didn't just have an original plan where 
we were going to digitize a certain type and amount of 
material. We intended to get feedback.
    Initially, some of the things we offered were thought to be 
maybe a little bit too scholarly and not accessible enough but 
now we have teachers really involved in telling us, what they 
need--the actual teachers, rather than just the scholars of 
American history. We are relying heavily on teachers who have 
some familiarity--classroom familiarity--and librarians who 
know what people are interested in, and we are getting consumer 
feedback as well. I think it is a fairly self-correcting 
system.
    If you had to fish for a problem, I think it would be the 
fundamental problem of whether people are going to use 
educational material or are just want instant action every 10 
seconds, in order to keep from using their minds. In other 
words, there are some people who apply a kind of television 
criteria, for a hurry-up, shortened attention span.
    But as far as the users who are already on the Internet are 
concerned, we don't receive much criticisms. I don't want to 
seem to be Pollyannaish about it, because it is an art form 
that is developing all along, but I do not think there is any 
salient criticism that I can think of.
    Originally, we didn't have nearly as much explanatory 
material as we now have. That has definitely changed. People 
need more guidance, and want more explanatory material.
    That, in turn is very labor intensive. I would say if there 
is any concern I have about our efforts, it is the concern 
about our curators, who are already very heavily taxed and are 
doing this kind of interpretive work on top of their reference 
and research work, because it is their expertise that we are 
tapping for the selection of material. When you have, 20 
million documentary photographs and you are trying to decide 
which ones to digitize, you have to rely on the curator's 
judgment. You have to pick carefully out of the whole 
collection.
    There was, I think, some concern since we were going to the 
K-12 market that there wasn't quite enough of sports and 
entertainment--areas with educational value but closer to where 
a lot of kids need to begin who aren't learning already. So we 
just got out an important Jackie Robinson collection for 
instance.
    We have the largest performing arts library in the world. A 
lot of that, of course, is still under intellectual property 
protection while most of the NDL content is in public domain. 
We try to get permission for other things that are of interest, 
and sometimes the owners allow us to do this because they 
realize it is basically an educational endeavor.
    Mr. Fazio. So you are trying to bridge from sports and 
entertainment to history, trying to find ways to get kids 
interested, so they can go further.
    Dr. Billington. Yes. So I would say if there is a general 
direction, if you look at what we are doing, it is to make it 
more user friendly, to use that awful term.
    Mr. Fazio. Certainly for this generation that is absolutely 
essential, because if it isn't user friendly, we often pick up 
a book.
    Mr. Walsh. If only that were the case.
    Mr. Fazio. That is the best spin I can put on it.

                           digitization goals

    Mr. Fazio. What is the desire of the Library in terms of 
its total collection? What are we going to try to digitize, and 
over what period of time? Where are we? Give me some 
benchmarks.
    We know there is so much material, and only so much of it 
is already there. How much more are we going to put on? Are we 
going beyond the K-12 period? Are we going to try to put the 
Library's basic collections out there for people? That is a 
massive undertaking.
    Dr. Billington. This is something we want to be in dialogue 
with the Congress about, because the original concordance, if 
you can remember--as you helped us draft it--was to establish 
our content goal for the year 2000. We had the 5-year 
experiment with the American Memory prototype from 1990 to 1995 
and we proved that it had a real K-12 market. Then 1996 to the 
year 2000, we were going to aim to digitize 5 million items of 
American history and culture, the most interesting and 
important ones.
    We have not quite raised all the private money. We are very 
close to having raised it all. But we have enough to operate 
on, and we are confident that we are going to get it all 
raised. The Congress has been marvelous about enabling us to 
continue, with its firm base of annual support.
    Now, the question really becomes then, what do we do beyond 
that? We are going to try to resolve this over the next year. 
So by the time we return to this committee next year, I think 
we will be able to give you some pretty good answers.
    Let me indicate to you just briefly what we are 
considering. Should we digitize another chunk? We could still 
do that. We will assess this. At the very minimum, we will 
continue servicing what we have digitized. This has to be a 
continuous obligation. The NDL has a very continually growing 
constituency. We want to make sure of what we have, and we will 
probably add marginally, in any event.
    Mr. Fazio. What would it be?
    Dr. Billington. It could be more of the same. I mean, if we 
reach the 5 million, we still will not have exhausted the 
Library's collections. We would have 115 million items in the 
Library of Congress and only 5 million on-line. There are many 
more items just in the Americana field, but should it be 
another package that is broader than America?
    I will give you another example. I have had discussions 
with the Spanish Government, with the Russian Government, and 
with the Chinese recently, all of whom want to do a joint 
effort. They have heard about the NDL. The Russians are talking 
about the meeting of the frontiers--the opening of the American 
West and then the opening of Siberia, meeting in Alaska. We 
have all the records of Russian Alaska, for instance, so we 
could do it cooperatively. One possibility is to expand the 
NDL. Or we could do some other educational package, maybe 
smaller. There are a whole lot of different options.
    Another totally different option which I have been 
considering that we might want to discuss--if the Congress 
thinks it is a good idea--with the private sector is doing a 
package or getting some kind of service that helps the 
productive private sector. We have anything you want to know 
about the Japanese economy. We have not only the materials--we 
have the largest foreign collections of almost every country 
outside of that country. And because we provide universal 
cataloging service in so many different languages, we also have 
expertise; the people who catalog all of this material know a 
great deal about these subjects.
    There is knowledge stored and part of the knowledge is 
hidden within the curators themselves--that could be of great 
value to our productive private sector in its international 
competitiveness, so we might want to do a totally different 
package. In the question of determining our sense of the 
future, what we are trying to do is to discuss and develop 
these options, and then discuss with the congressional 
committees what we should be considering.
    Mr. Fazio. There are a whole lot of issues raised here. 
There are unlimited things, almost, that you can do.
    Dr. Billington. What should we do with the Congress' 
library? You have collected the largest supply of knowledge in 
the history of the world. It is very comprehensive in its 
inclusiveness of overseas material, and it seems to me that 
having done a package for education, we ought to at least 
consider if we can do a package of support for the productive 
private sector.
    Mr. Fazio. When you say ``for the productive private 
sector,'' are you anticipating that they would make funds 
available to develop this on the premise that they would have 
the greatest benefit and use for it?
    Dr. Billington. I would think if we got into that business, 
that should be on a self-sustaining basis. That should also be 
encapsulated, so anything we entered into does not interfere 
with the free services that we provide. So that would be a 
totally different operation. It would be a form of 
digitalization on demand.
    Mr. Fazio. For example, let's stop and think. The Japanese 
economy, obviously we would all like to have that information 
available to American policymakers, but it would be very 
valuable to a lot of people in the private sector; everybody 
doing, you know, analysis of the Japanese economy for Wall 
Street or other investment entities.
    Are we going to be driven by where the money would be, 
where the market could be made, or are we going to--as the 
American Library Association historically wants us to be--
driven by, the marketplace of ideas and make it available on 
the basis of its intrinsic value to the general public? Are we 
going to be driven by where we can raise the money? Because 
this committee is going to be limited, at least in the pace of 
what we could invest.
    Dr. Billington. This could never--if we get into anything 
like this--be in place of or as a means of support of the basic 
free services that this library has always performed.
    Mr. Fazio. But we would be permitting it in a format that 
would make it far more immediately available to people.
    Dr. Billington. Yes, we already do that. We have a Japan 
Documentation Center, for instance, which gathers in additional 
documentation over and above that which the Congress was very 
interested in a few years ago, and which we have established.
    Mr. Fazio. Right.
    Dr. Billington. So we have a tremendous network for 
gathering in foreign knowledge and information and it is all 
freely available. The question is: Is there some digital aspect 
to our foreign collections? Should we do another chunk of 
American history or English language material, or should we try 
to get some of the big, wide world out?
    Now, we could do that as a free package, but it would be 
expensive. With a small operation like ours, it has been too 
hard to raise the amount of money for digitization. We can't go 
on. We would have a large management problem to consider. But 
we would never get into one of these things at the expense of 
free public service.
    The question, though, as a national library, in effect, 
even if not in name, what should we do? Our problem is a simple 
one which the Congress can help us determine, really: What 
should we do for the country?
    Now, it is very clear that we can do more for the 
educational area. Maybe we should limit ourselves to just the 
educational package. All I am saying is we have these immense 
foreign collections. We do the basic cataloging of them, so we 
have people who read these languages and have an awful lot 
stored in their heads. Is there some additional use that can be 
made?
    We already do that, of course, to some extent through the 
Congressional Research Service for the Congress. We also do it 
through the Federal Research Division for the executive branch 
on a sort of cost-recovery basis--an encapsulated operation. 
Should we have some kind of delivery system or some kind of 
system that helps the productive private sector, I mean, on a 
free basis if possible, but on probably a minimal cost-recovery 
basis as a practical matter? Or should we even think about 
that?
    Anyhow, my point is that your question is one that comes up 
now because we are reaching--we will be preparing the budget 
for the year 2000, and that will be the last year of completing 
what we have already agreed to. The question is, where do we go 
from there? So perhaps I should have just given you the short 
answer, rather than an extended set of possibilities.
    Mr. Walsh. Short answers are always advisable.
    Dr. Billington. The General is trying to discipline me.
    Mr. Fazio. Let me give just a few more short questions and 
no follow-ups. I look forward--I don't actually get to look at 
it, but I think it would be instructive for the committee to 
see where, ultimately you take this blue-sky debate about where 
you are going to put your resources.
    Dr. Billington. Just to be clear on the procedure, I think 
we should discuss this among ourselves this spring, and present 
to the committee sometime later on, and to other congressional 
bodies,--to the oversight committee, certainly, as well as the 
appropriators--a range of possibilities to see what, if any, we 
should explore further.
    Mr. Fazio. I think it is going to be very tough to decide.

                                security

    Just briefly, you are asking for $2.5 million to enhance 
security. Could you document briefly for us, perhaps General 
Scott, what the security problem has been over the last 5 
years; how much we have lost, what this will do to stem the 
tide?
    We periodically read about these things in the local paper, 
but I am wondering if you could document it for us. What are 
the security problems at the Library?
    General Scott. Security at the Library was, I guess--if you 
take a 5-year view of it, reviewed and analyzed by several 
outside agencies. Computer Science Corporation came in and 
helped out, and we had people who did some other studies. They 
identified some areas that with physical security, and also 
with security of the collections and offered several 
recommendations--not several, but as I recall it, there were 
hundreds of recommendations that came out in all those areas.
    One, and I think a key finding, that came out of that was 
since the Library had so much material--books and records and 
film, that dates back almost 200 years--that there had never 
been a comprehensive inventory, so it was very difficult to 
really know exactly what you had and where you had it.
    The last year when we were talking to you about supporting 
and funding the library information system, we had a little 
chart that showed if you went for a book and it was not on the 
shelf where we thought it was, it would often take as many as 
20 steps just to figure out what happened to it.
    This leads into documenting the losses. Many of the losses 
that are reported actually are not stolen but they are missing. 
The magnitude of that is so large that it is very difficult to 
chase each one of them down to figure it out. But we do have 
some figures. I would have to make it for the record, since I 
don't have it right here before me, that show that as we have 
started to implement. As we have started to implement some of 
the provisions in our security system, we have tightened up 
some controls. We have tagged books. We have also tagged items 
that come into copyright. We have increased the security going 
in and going out. So therefore, the numbers of items that we 
detect has risen.
    [The information follows:]

    Based on reports from the Library's Office of the Inspector 
General, using event data reported to the Library police, 
statistics for five calendar years, 1993 through 1997, are as 
follows: in 1993, 26 attempted removals and 59 mutilations; in 
1994, 12 attempted removals and 10 mutilations; in 1995, 24 
attempted removals and 95 mutilations; in 1996, 20 attempted 
removals and 149 mutilations; and in 1997 (through August), 13 
attempted removals and 221 mutilations. Attempted removals 
consisted of those items people tried to remove (either 
intentionally or unintentionally) from the Library but were 
confiscated by the Library police at building exits. The 
Library does not assign a dollar value to the attempted 
removals.
    The fiscal 1999 request implements entry security that is 
comparable to other Capitol Hill buildings and the application 
of ownership markers and theft detection devices for Copyright 
Office materials. Applying ownership markers and installing 
theft detection devices at the earliest point of entry will 
reduce the vulnerability of the materials to theft.

    General Scott.  In that regard, part of the money that we 
are asking for now for our security would be to purchase 
scanners and also x-ray machines. We are probably the only 
building here on Capitol Hill that does not have scanners and 
x-ray machines. That was a recommendation given to us by the 
Computer Science Corporation.
    It was also recommended that we upgrade our security 
system, the electronic security system, because it was getting 
quite old. There was a recommendation that we do that piece of 
it.
    There are a number of other items in the budget in support 
of our security. It totals about $2.5 million. It talks about 
continuing to upgrade and do a design on the internal security, 
it talks about putting in reader registration, where you swipe 
your card through to get identified.
    The bottom line was lack of an inventory, lack of 
sophisticated equipment to help us, which put a burden on those 
who were manning the gates, so to speak. In our security plan 
we have identified what they recommended. We included in the 
budget those items we think are necessary for this year and 
that we can't absorb. We are continuing, in accordance with our 
security plan, to analyze and refine those items that we need 
to put in the budget for the year 2000.
    Mr. Fazio. What do you assume is going to be your total 
cost here over time? This is an increment over what period and 
in what amount?
    General Scott. Right. Well, as I said, we have finalized 
our strategic plan. That goes out to the year 2004. As far as 
security goes, this year's budget includes some of our top 
priority items. We know that for the year 2000, there will be 
more items that follow the recommendations that were made. At 
present, we have an idea of what the cost will be for an 
upgraded electronic security system--about $5 million.
    Then there are some other high-priority items that we don't 
know exactly how much it would cost because we are still in the 
process of refining them. Within our process we should know by 
July or August of this year. It is difficult to give you one 
dollar cost right now for the year 2000.
    [Questions from Chairman Walsh and responses follow:]

                                Security

    Question. What would be an order of magnitude estimate of 
the additional costs necessary to implement this program?
    Response. For the fiscal 2000 budget, the Library plans to 
provide an estimate of the costs required to implement the 
plan's physical security controls. A priority item, estimated 
to cost approximately $5 million, is upgraded electronic 
security systems. Two other high priority categories, the costs 
of which are now being calculated, are to improve physical 
security of collections processing and storage areas and to 
improve operational procedures and controls to safeguard 
collections while in use, i.e., reading room controls, reader 
registration, etc. As called for in the plan's Integrated 
Schedule of Actions, the Library will test integrating its 
bibliographic and inventory controls within the planning 
framework. This integration will create protection 
prioritization grids for both of these control areas and 
identify unmet requirements and needs for future funding. The 
Library's senior leadership will scrutinize and prioritize 
these additional control requirements.
    Question. What is the magnitude of the problem you are 
trying to solve? That is, what is the extent of the problem you 
are trying to solve?
    Response. The magnitude of the collections security problem 
is defined by the Library mission, which shapes access to the 
collections by users and staff. The Library's mission, and 
hence, it's security plan must ensure that the nation's 
collection of knowledge and creativity will be available for 
use by future generations. Unlike a museum, the Library serves 
items to users--each year serving more than 500,000 readers in 
the 20 reading rooms in Washington open to the public and 
responding to nearly one million information requests a year 
from all over the nation.
    The Library's security direction is to identify threats and 
vulnerabilities and to implement preventative measures rather 
than simply reacting to security incidents as they occur. The 
budget request asks for high priority items, based not only on 
past incidents but on our assessment of current threats and 
vulnerabilities.
    Quantifiable indicators of the magnitude of the Library's 
security problem are limited by the present level of 
effectiveness of the Library's inventory and bibliographic 
controls. The Integrated Library System, approved by the 
Congress, will significantly enhance the Library's inventory 
and bibliographic control. A 20-year ongoing inventory of the 
classified general book collection, numbering more than 10 
million volumes, has indicated a cumulative missing rate 
(unaccounted for items in the inventory) of 2.5-3%. The 
aggressive security tagging program of the existing collection 
has significantly boosted the number of mutilations discovered, 
to include 149 in calendar 1996 and 221 in the first eight 
months of calender 1997. The Security Plan addresses both 
internal and external threats.
    Question. How many books and other materials have been 
stolen or vandalized? Over what period of time?
    Response. Based on reports from the Library's Office of the 
Inspector General, using event data reported to the Library 
police, statistics for five calendar years, 1993 through 1997, 
are as follows: in 1993, 26 attempted removals and 59 
mutilations; in 1994, 12 attempted removals and 10 mutilations; 
in 1995, 24 attempted removals and 95 mutilations; in 1996, 20 
attempted removals and 149 mutilations; and in 1997 (through 
August), 13 attempted removals and 221 mutilations. Attempted 
removals consisted of those items people tried to remove 
(either intentionally or unintentionally) from the Library but 
were confiscated by the Library police at building exits. Items 
mutilated included newspapers, magazines, single pages, and 
books. It is important to note that the majority of the 
mutilated books were discovered during the recently accelerated 
security tagging process, which explains the significant 
increase in mutilations discovered and reported for the past 
several years. These figures on mutilation reflect the date 
reported, not the date on which the mutilation occurred.
    Question. Unless we have a good understanding of the 
magnitude of the problem, it is impossible to evaluate 
solutions to solve it. What efforts have you made to measure 
the extent to which the collections have been stolen or 
physically mutilated?
    Response. Again, the Library's security direction is to 
identify threats and vulnerabilities and to implement 
preventative measures rather than simply reacting to security 
incidents as they occur. The budget request asks for high 
priority items, based not only on past incidents but on our 
assessment of current threats and vulnerabilities.
    The Library has implemented a number of actions to measure 
the extent of the problem. Beginning in 1978, the Library began 
conducting a general collections inventory. This inventory 
shows a missing in inventory rate of approximately 2.5% to 3%. 
In 1993, several Library staff members conducted a page-by-page 
examination of art folios, recording each missing page and 
plate. In September 1996, the Library completed a survey of 
5,000 books selected from high-risk areas of the general 
collections. The randomly selected books were examined cover-
to-cover to establish a baseline of their condition. The books 
will be re-examined over a five-year period to determine the 
nature of any mutilation to these books or if they were stolen. 
The Integrated Library System, approved by the Congress and in 
the process of being implemented, will enable the Library to 
make more accurate estimates of loss and possibly stolen or 
mutilated items.
    Question. If a large source of this problem is 
``misplacement'', new security measures would not help as much 
as just improving the handling of the collections. In the past, 
funds have been provided for inventorying the collections and 
developing shelflists. Maybe you should evaluate why those 
efforts did not solve the misplacement problem. Comment?
    Response. A number of factors contribute to misplacement, 
including the overcrowding in some collections storage areas. 
This situation will be remedied when off-site storage becomes 
available and collections are transferred to that site. Some 
``misplaced'' items were found during the inventory of the 
general collections that began in 1978, and such items were 
returned to their proper place on the shelves. The acquisition 
of the Integrated Library System will provide a valuable tool 
for item level control, assisting staff in ascertaining whether 
an item is truly missing or has been misplaced. But regular 
``shelf-reading'', to assure that items have been properly 
placed on the shelves, is labor-intensive.
    Question. It seems fundamental that the Library needs to 
measure the extent of the problem you are trying to solve here. 
Any credible proposal to deal with solutions to theft, 
mutilation, or misplaced documents must start with a 
quantitative understanding of the problem. Otherwise we will 
expend money without any ability to determine its 
effectiveness. We would like to see a proposal from the Library 
on this matter.
    Response. The Library strongly concurs that reliable 
quantitative measures are vital to determining the 
effectiveness of security controls in place. The Integrated 
Library System will provide a better mechanism to enable the 
Library to make calculated assessments of patterns and trends 
in losses in a large part of its collections. The Library's 
Security Plan has provided a comprehensive planning framework 
and Integrated Schedule of Actions that will enable the 
prioritization of unmet minimal security standards. By 
addressing these requirements on a priority basis, the Library 
will implement risk-mitigation measures minimizing the 
collections' vulnerability to theft and mutilation. The 
completed baseline survey of 5,000 books will also assist in 
measuring the extent of mutilation.
    Question. Within your budget request you have asked for an 
increase of $2,458,331 to enhance security at the library. What 
has been the total dollar amount of losses due to theft over 
the past five years?
    Response. The Library's security direction is to identify 
threats and vulnerabilities and to implement preventative 
measures rather than simply reacting to security incidents as 
they occur. The budget request asks for high priority items, 
based not only on past incidents but on our assessment of 
current threats and vulnerabilities.
    Based on reports from the Library's Office of the Inspector 
General, using event data reported to the Library police, 
statistics for five calendar years, 1993 through 1997, are as 
follows: in 1993, 26 attempted removals; in 1994, 12 attempted 
removals; in 1995, 24 attempted removals; in 1996, 20 attempted 
removals; and in 1997 (through August), 13 attempted removals. 
Attempted removals consisted of those items people tried to 
remove (either intentionally or unintentionally) from the 
Library but were confiscated by the Library police at building 
exits. The Library does not assign a dollar value to these 
attempted removals.
    In the past five years, we had one known theft which 
resulted in the indictment of one Library employee on 22 counts 
of book theft form 1992 to 1997. In terms of estimating the 
value of those losses, which were ultimately recovered, we 
prepared an estimate to support the litigation process. The 
``loss estimate'' totaled $25,000: 22 counts involving 27 
items, with the items ranging in value from $25 to $10,000.

    Mr. Fazio. But this is the beginning, not the end, right?
    General Scott. This is certainly the beginning.
    Mr. Fazio. I understand we are going to be hearing from the 
Registrar of Copyright and CRS.
    Mr. Walsh. If we have time.
    Mr. Fazio. Are there any other people?
    Mr. Walsh. CRS and others, books for the blind, also.
    Mr. Fazio. Thank you, Mr. Chairman.
    Mr. Walsh. Thank you.
    Mr. Wamp.
    Mr. Wamp. Mr. Chairman, I want to yield for a minute to Mr. 
Cunningham for a quick question for the record, because he has 
to go get fitted for his new flight suit as he test flies the 
new EF-18 this weekend, and I think that is pretty exciting, 
Top Gun. I will yield to the Top Gun.
    Mr. Walsh. God help us.
    Mr. Serrano. Is that for our Air Force?
    Mr. Cunningham. What is that? Actually, it is planning the 
invasion of Puerto Rico, my friend.
    Mr. Serrano. We did that in 1898.
    Mr. Walsh. Go ahead, Duke.
    Mr. Cunningham. You can just provide it for the record, if 
you would.
    I was recently in San Diego and went down to an 
organization that dealt with education for the physically 
impaired. There was a person there that was blind, sight-
limited, and he had a software program that as he touched the 
computer keys, the computer would talk to him. And he had 
different programs in which he could actually work the 
computer. And this guy could do it faster than I could, and I 
am sighted. And if there is any program--if we ever have a 
hearing on the subject of assistive devices for the visually 
repaired, I would love to bring this gentleman back.
    If you would just provide for the record information on 
special education needs, what the Library is doing with the 
Internet and those kinds of things, I would be interested. My 
friend works with our Private Industry Council in trying to 
provide technology to people that are impaired. I have another 
lady named Holly Candill that is paralyzed from the neck down, 
but she is working in the same area and looking for ways to 
improve the lives of people with disabilities.
    If you could provide your answer for the record, I would 
sure appreciate it. I have to run, and I don't want to infringe 
on his time. That is why I will ask you it for the record.
    General Scott. We certainly will provide that for the 
record.
    [The information follows:]

[Pages 317 - 333--The official Committee record contains additional material here.]


    Dr. Billington. Do you want a brief word from the head of 
the----
    Mr. Cunningham. Well, I don't, because he would kill me, 
and I have to run. I am going to fly the EF-18 and I want to be 
ready.
    Mr. Wamp. Reclaiming my time, Dr. Billington and General 
Scott, welcome back again this year. You used the word 
Pollyannaish, a moment ago, Dr. Billington. I want to say to 
you, I have been using that word for several years.

                  committee vote for executive session

    Mr. Walsh. Excuse me just for one moment.
    Mr. Cunningham, if you could hold for one minute, we have a 
motion that we have to put on the floor, now that we have a 
quorum, that we can eliminate very quickly if you will just 
wait one minute.
    Mr. Cunningham. Yes, Mr. Chairman. I will be happy to.
    Mr. Walsh. We will return to this as soon as we finish.
    I apologize, if we could proceed out of order for a moment. 
Mr. Serrano has a motion that he would like to place before us.
    I guess I have my script here.
    Mr. Serrano. The explanation.
    Mr. Walsh. The Sergeant at Arms has requested that we enter 
executive session for a portion of the Capitol Police Board-
Capital Police appropriations hearing. He indicates that 
sensitive law enforcement information will be discussed. Under 
committee rules it will be necessary to vote on this matter. I 
recognize Mr. Serrano for the purpose of making a motion.
    Mr. Serrano. Thank you, Mr. Chairman. I move to hold a 
portion of the Capitol Police Board-Capitol Police 
appropriations hearing in executive session at such time as the 
Chairman determines.
    Mr. Walsh. Under the committee rules, this motion is not 
debatable. This vote will be recorded. All those in favor of 
the motion vote ``aye,'' all opposed no.
    None being opposed--we are going to do a rollcall. The 
Clerk will call the roll.
    The Clerk.  Mr. Cunningham.
    Mr. Cunningham. Aye.
    The Clerk.  Mr. Fazio.
    Mr. Fazio. Aye.
    The Clerk. Mr. Hoyer.
    [No response.]
    The Clerk. Mr. Latham.
    Mr. Latham. Aye.
    The Clerk. Mr. Livingston.
    [No response.]
    The Clerk.  Mr. Obey.
    [No response.]
    The Clerk.  Mr. Serrano.
    Mr. Serrano. Aye.
    The Clerk. Mr. Walsh.
    Mr. Walsh. Aye.
    The Clerk. Mr. Wamp.
    Mr. Wamp. Aye.
    The Clerk.  Mr. Young.
    [No response.]
    Mr. Walsh. The motion is carried on a vote of six ``ayes'' 
and none opposed. The motion is adopted.
    Mr. Latham. Six is a quorum?
    Mr. Walsh. Yes, that's correct.
    Thank you.
    Mr. Wamp, the floor is yours.
    Mr. Wamp. Thank you, Mr. Chairman. Back to my four points. 
You used the word Pollyannaish. I must say as someone who has 
used that word for many years without knowing if it is proper, 
it is very reassuring for the Librarian to use the word 
Pollyannaish, and I will proceed in the future using that word.
    The second thing I want to recognize is it is good for me 
to be back here in my second year and see each of you, and all 
of your support team back here, but also I want to recognize 
very briefly Vic Fazio. This is the first time we come back for 
our final set of hearings under his leadership, and frankly, 4 
years ago the guy came into my district and campaigned against 
me, and now I really like him. So that is what----
    Mr. Fazio. I got the message and never went back.
    Mr. Wamp. I just wanted from this side of the aisle to say 
that this place will miss Vic Fazio, and he is really committed 
to excellence. I think he serves this Congress very well. I 
know this is going to be a yearlong event for him, with people 
praising him, but I wanted to start right here recognizing his 
leadership and knowing that this is the last time that the 
Library of Congress will come before him on this committee and 
ask for their priorities, and give their--give him their input.
    I think he is very methodical and should be commended for 
his service here.
    Mr. Fazio. Thank you.
    Mr. Wamp. Also, I want to say that in now my annual 
tradition, I was a book consumer from Thanksgiving to 
Christmas; while I was back in Tennessee, I read four books, 
one of which I checked out and returned to the Library of 
Congress. And I just want to thank you, really, for a job well 
done across the board.
    A 6.5 percent increase obviously is more than inflation. I 
realize some of this is mandatory and we can't get around it. 
So we have to swallow hard when we are looking at the numbers. 
But frankly, you all in my opinion are one of our examples of 
effective delivery to people, and I commend you very much.
    I want to just for a moment think out of the box, because 
the year 2000 problem, as a relatively young guy, to me still 
blows my mind that we are almost there and this problem still 
faces us. I don't want to talk about that because I know you 
are doing all you can, and so is the rest of the country, 
because we are in a hurried-up offense. This is really 
difficult here to even pull this off in time.

                            LIBRARY'S VISION

    Mr. Wamp. But let us think just a minute. Twenty years down 
the road, through Thomas and our archives--you all have now 
just about automated the Congress, which it was not before. You 
are kind of leading the way. Let us think, if we are in 2018 
and this committee meets, do we do this then by video 
teleconference? Do we vote electronically? Where is the Library 
of Congress in this picture?
    I say that because, frankly, I think it is about time, with 
technology happening as quick as it is before our very eyes, 
that we begin discussing where are we going to be and what 
plans are we making. The Library of Congress, frankly, if we 
look--historically now, we are about there. With the present, 
we are about there. What about the future? Where are we going?
    I mean, frankly, it is not very efficient for us to come 
and go. Can't we vote electronically in a generation? I don't 
know. Maybe we don't want to. This is a wonderful room. You can 
experience this, and it is second to none. But there may be a 
time and place. Is the Library of Congress doing anything to 
prepare us for 20 years from now?
    General Scott. I think this is tailor made, because we had 
talked about our vision and where should the Library go, and 
what should the Library do, and how should we serve our 
customers. I do think that we have opened a dialogue that 
sorely needs some input from the Congress. We are your library, 
and we serve the people who sent you here.
    That is a good segue for me to say that the Librarian does 
have a vision. I think it would be useful for you to hear a 
capsule of that vision, to show you what we are thinking about 
with respect to serving you and your constituents in the 
future.
    Dr. Billington. To try to deal directly with your question, 
we have a rare opportunity at the Library of Congress--to 
integrate the new electronic world with the old world of books 
and memory.
    The danger of thinking about everything electronically is 
that it is memory-erasing, first of all, because its databases 
constantly need to be brought up to date. There is no memory 
intrinsically. That is why putting ``An American Memory'' into 
this, I think, was a good start, because you have new 
technology which you have to master but you have old experience 
that you have to integrate into it.
    I do not think rooms like this and bodies like this are 
going to be outmoded. We decided at the beginning of this 
Republic not to have a plebiscitary system. I don't know how 
you could do it very well.
    Mr. Wamp. What is that word?
    Dr. Billington. In other words, when you have 
representative government, you don't have plebiscites on 
everything.
    Mr. Fazio. Only in California.
    Dr. Billington. You could theoretically resolve everything 
electronically. You know, here is a bill, and you push a 
button. For example, the minute after somebody has spoken on 
television, there is an ABC poll that tells you that 63 percent 
of the people think that was a good idea that the guy just 
presented.
    Well, there is no deliberation, there is no consideration 
of what the context was, what the alternative ideas are, and so 
forth. It was all, who wears the brightest colored tie on ``The 
McNeil-Lehrer Hour.'' It is not even that which is relatively 
deliberative. It is not the same as having a body like this 
that is elected by people, not simply to be a pass-through for 
electronic signals, but to be a deliberative body.
    So I think the role of the Library of Congress is going to 
be one of knowledge navigators, people who are going to be 
guiding their way through this so that you can be responsible 
deliberators in the future, because you will need some kind of 
dependable filters so that you are not just jagged by whoever 
has hired the best ad firm last week.
    The Library's Treasures exhibit is organized as Jefferson's 
library was. Jefferson had the first system for organizing 
knowledge in this country, even before the Dewey decimal 
system, which was later succeeded by the Library of Congress 
system. Jefferson's library followed memory, reason, and 
imagination. Our ``Treasures of America'' exhibit, a permanent 
exhibit, is organized into those three categories--memory, 
reason, and imagination. Those are also the qualities that 
individual people have.
    Machines are reasonably good at certain types of reasoning, 
but not all kinds of reasoning. They are not very reliable 
mediators of memory in and of themselves, and they don't have 
very much imagination. I think, you know, that Jefferson's 
system is pretty durable, and it is important that this system 
master and domesticate the new technologies and not simply be 
overwhelmed by it. That is what, hopefully, we will be able to 
do for you. But it is going to be a daunting challenge.
    But I think my own view is that the importance of judgment, 
values, deliberation--representing different visceral interests 
that our kind of system of government was set up to do--is 
going to be more significant than ever, so that we are not 
overwhelmed by the Frankenstein we have created.
    I think we ought to let Dan Mulhollan, head of CRS, have a 
word on this one, because I know that CRS has been doing 
particularly forward-looking thinking on this particular issue.
    Mr. Mulhollan. Particularly, Jim Billington and Don Scott 
had a 1-day retreat for all the executive committee of the 
Library approximately 8 weeks ago. They said, where is 
technology taking the Library of Congress in the year 2010?
    We asked one of my colleagues who specializes in Congress 
about the future of Congress, basically--how are Members of 
Congress going to be doing their work in the next millenium--
what will the Congress look like in the future? And there was a 
1997 political science panel that has been involved in this 
question as well. The whole question is, when we look at the 
decisions about the direction of the LIS, decisions and 
proposals for our CRS reports, they have implications because 
so much is technology-driven.
    It is really quite clear that the deliberations of Congress 
are changing. When you have amendments immediately being 
brought up to the floor with more information available, it 
impacts the ways of the consideration of measures by the Senate 
and the House. We have more and more information immediately 
available on markups as well as a result of technology changes.
    We do know from democratic theory that democratic systems 
can go on overload if there is too much input, and one has to 
be very cautious about the implications of stressing our 
current representational structure. We are looking at this. We 
are trying to plan ahead, and there are a number of 
consequences. Policy should drive technology, not technology 
policy.
    Mr. Wamp. Thank you.
    Dr. Billington. I think what you are going to see in the 
year 2010 or 2020 is going to be that information and data will 
be totally electronically provided, instantaneously available. 
Theoretically it will free us up and will free you up a little 
more than you are freed up now. Now you have to do a lot of 
inefficient sorting through material. That will be much more 
efficiently sortable and efficiently retrievable.
    But at the same time, the big issues and questions of 
policy are going to involve judgment and values and memory and 
qualities that only people will have and only the clash of 
opinions of elected representatives are going to be able to 
resolve.
    I think this is amazing. We are the oldest continuously 
functioning, written, constitutionally-based system in the 
world. It has survived an awful lot of change. This country has 
gone through fantastic changes in 200 years. It is going to go 
through a lot more. But what I think may be missing and what I 
hope we can provide that we have not talked about is more of 
the high-quality intellect that is dispersed all around this 
country.
    As it is now, you tend to see only advocacy-
orientedintellect here. You need to get the deep thinkers together with 
the deep legislators. And I hope that that building----
    Mr. Wamp. As opposed to shallow legislators?
    Mr. Serrano. As opposed to legislators who are also 
thinkers.
    Dr. Billington. I think one of the great things about 
restoring the Jefferson building--another thing that we owe to 
Mr. Fazio and his colleagues, who had the vision to see that 
this was worth doing--is that the building itself is an 
expression of American exuberance and optimism, a belief that 
the applied use of knowledge can keep the system self-
correcting and self-improving.
    We should attract more of the people who don't just come 
here to sell a product or to express an opinion that everybody 
knows about in advance but, rather, to get a little more of the 
traffic of high intellectual value.
    I hope we can generate what we are thinking of calling 
something like a congressional knowledge center here, and get 
some of the great thinkers here so that you are exposed to 
them. Not simply to get their opinions or their briefs on a 
legislative issue--that is fine, too. An important part of the 
advocacy process is to be exposed to people of rare judgment 
and perspective, of whom we have a lot.
    There are half a million students in the colleges of 
America from foreign countries. They all want to come here and 
tap into our knowledge. But I do not think you are getting 
necessarily the best of that knowledge. You are getting a lot 
of advocacy products, but you will need more in the future, 
because the questions of judgment and values are going to be 
more important.
    You need to have people who are just pure resources on 
judgment and value, and not simply inefficient computers 
retaining a lot of facts and figures. The facts and figures 
will be at your fingertips with the computers and electronic 
technology of tomorrow. Hopefully the Library of Congress and 
Congressional Research Service and other services at your 
disposal will be efficient and fair mediators of all that 
information.
    But I think the one missing piece will be intellectual. I 
think the Jefferson building can serve as an enormous magnet to 
bring some of the great scholars and thinkers that we have to 
Washington. We have a large number of scholars in this country, 
many of whom have never been to Washington. You don't want just 
the people who are anxious to come here.
    Mr. Serrano. That is why they are still thinking.
    Dr. Billington. You don't want to have them necessarily 
here all the time, but coming through, so you have a chance to 
meet them informally, and give you a chance to have that kind 
of contact.
    And they need better contact with the people who make up 
our government, too. I sat on university campuses for 18 years, 
and in faculty rooms, they have strange ideas about what goes 
on sometimes. So it is good and it is healthy for the country 
to have interaction between the world of affairs and the world 
of ideas. You are not always getting the best thinkers, the 
deepest thinkers here, so I hope we can add that as well as 
provide you very efficient, up-to-date electronic information.
    I don't think the system, I don't think rooms like this, 
and deliberations like this can be replaced. Maybe you will 
have a Librarian who doesn't talk quite so long and is a little 
more efficient in the future, but I think the system, as set 
up, is pretty durable.
    Mr. Wamp. Thank you, Mr. Chairman.
    Mr. Walsh. Thank you, Mr. Wamp.
    Mr. Latham.
    Mr. Latham. Have you talked about the copyright 
arbitration?
    Mr. Walsh. We have not.
    Mr. Latham. At all, the decision.
    Mr. Walsh. If you would like to ask about that, we have the 
Register here.
    Mr. Latham. Is Dan going to----
    Mr. Walsh. We anticipated bringing Mr. Mulhollan up after 
the Librarian was completed, but feel free, maybe we can wrap 
it up sooner that way.

                            copyright issues

    Mr. Latham. You recently approved a rate increase, as 
recommended by the Copyright Arbitration Royalty Panel, that 
took effect, January 1st, 1998. That increase resulted in great 
increases to the cost of direct and satellite TV service to my 
rural constituents. I just want to know what the basis for the 
panel's recommendation was to initiate such a large rate 
increase, and your rationale, for upholding the decision.
    Mr. Walsh. Let me introduce the Register of Copyrights, 
Marybeth Peters. Welcome to the table.
    Ms. Peters. The short answer----
    Mr. Walsh. Perhaps Marybeth should give the short answer.
    Dr. Billington. Do you want the long answer from me?
    General Scott. You can summarize.
    Ms. Peters. The short answer is the standard that is in the 
law for satellite rates is very different than the standard is 
for cable; the satellite standard is new--it is fair market 
value. The arbitrators used a fair market value standard that 
resulted in significantly higher rates.
    The Copyright Office reviewed that decision under an 
arbitrary or contrary-to-law standard, and we cannot say that 
what the panel did is arbitrary or contrary to law. You may not 
like the standard, but it is not contrary to what is in the 
law. The decision is now on appeal to the Court of Appeals for 
the District of Columbia.
    The parties sought a stay to not have the new rates go into 
effect. The Court has already denied that; the full case will 
be heard by the Court. There are bills in Congress toset that 
rate aside, and the issue will be debated in the months ahead. Fair 
market value is the standard that is in the law. That may not make you 
happy, but it is the rate, as opposed to another rate, that Congress 
set.
    Mr. Latham. Is there a short answer, too?
    Dr. Billington. The short answer is the differential in the 
rates is derived from the different standards that are 
established by law for the two means of delivery. In other 
words, the two different areas of satellite and cable have 
different standards, which, by law, are established for setting 
up the rates, and, therefore, unless it is contrary to the law, 
or arbitrary, neither of which I judged it to be, or the 
Register did, that we can't set the ruling aside. It is a 
question of changing the law, rather than changing the rates--
--
    Mr. Latham. I just wanted to ask, in a rural area, where a 
lot of my constituents have dishes and that is their only 
access, a large majority of my people do not have access to 
cable, so it is really a rifle shot at the rural population, 
with the huge increase, and I just want to put emphasis on that 
fact.
    Ms. Peters. The Copyright Office is already on record 
saying where what is being delivered is exactly the same, the 
method of delivering should not bring about a difference in 
payment. In order to have that result come about, then Congress 
has got to change the law.
    [The information follows:]

[Pages 341 - 347--The official Committee record contains additional material here.]


    Mr. Latham. Okay. Mr. Chairman, were you going to have Dan 
testify? I will wait and submit my questions. Thank you.
    Mr. Walsh. I believe that completes the questioning. I do 
have some additional questions, but the hour is late so I would 
like to submit those for the record and give you an opportunity 
to respond back.
    [Questions from Chairman Walsh and responses follow:]

                               Copyright

    Question. Do you have authority to adjust your registration 
fees to compensate for this receipt reduction?
    Response. This question is best answered in two parts. 
First, the Copyright Office plans to use its spending authority 
to project an additional $1 million in receipts from new higher 
based discretionary fee charges, new deposit account interest 
receipts, and growth in current registration fee receipts. 
Second, the President signed the Technical Amendments Act, P.L. 
No. 105-80 into law on November 13, 1997, providing the Office 
with the authority to adjust its statutory fees pursuant to 
conducting a cost study and final review by the Congress. 
However, the fiscal 1999 budget does not anticipate additional 
receipts from an increase in statutory fees because of the time 
it will take to implement a new fee structure. Statutory fees 
increases will be incorporated into the fiscal 2000 budget.
    Question. It may be necessary to expedite your fee schedule 
study. It will be very difficult to get a $2 million increase 
in this appropriation. What can you do to expedite the process?
    Response. The Technical Amendments Act, P.L. No. 105-80, 
gave the Office the authority to change statutory fees on the 
basis of conducting a cost study and sending Congress a 
proposed new fee schedule with accompanying economic analysis. 
After receiving the material, Congress has 120 days to approve 
(by taking no action) or disprove (by passing legislation). The 
cost study was recently completed and the Office is in the 
process of carefully reviewing that study, providing an 
economic analysis and recommending a proposed fee schedule. 
This schedule needs to be communicated to the copyright 
community and comments from copyright industries, authors' 
groups and other affected parties need to be carefully 
considered before a proposed fee schedule is presented to 
Congress. It is difficult for the Copyright Office to 
accurately predict if statutory fee increases in fiscal 1999 
will be able to absorb the additional $2.2 million requested in 
net appropriations. There is a high level of uncertainty that 
revenue projections will be met because of the historical 
decline in demand for these services when fees are increased 
and the rush to register before the fees go up. It is 
therefore, critical for the Office to have a transitional 
period to accurately forecast changes in demand. Information 
learned in this transitional period will enable the Office to 
more accurately project receipts for fiscal 2000.

    [A question and response from Mr. Cunningham follow:]

                               Copyright

    Question. Congress is contemplating legislation to change 
the copyright laws as they relate to the revolution in 
telecommunications, and the ability to transmit just about 
anything around the globe with a few computer keystrokes. This 
bill, H.R. 3048, introduced by Reps. Boucher and Campbell, 
makes significant changes in the Copyright Act, and changes 
U.S. practices to implement the World Intellectual Property 
Organization Copyright Treaty. Knowing that you do not take 
positions for or against legislation, could you give up your 
perspective on how the current situation and this bill would 
affect the work of the Copyright Office?
    Response. H.R. 3048 is a wide-ranging bill that would make 
changes in eight separate areas of U.S. copyright law. Although 
the bill would have a significant impact on the substance of 
copyright law, its impact on the work of the Copyright Office 
would be minimal. The bill makes no changes affecting the 
Office's administration of the Copyright Act.
    If H.R. 3048 were to become law, we anticipate that the 
primary role of the Copyright Office in its implementation 
would be in the area of public education. The Office, through 
its Information and Reference Division, prepares written 
materials on copyright law for dissemination to the public. 
Some of these materials would require updating, and we might 
need to prepare some additional materials to educate the public 
about the changes to the Copyright Act. Moreover, our employees 
who respond to public inquiries concerning copyright law would 
have to be trained in the substance of the new law.
    In addition, section 1202(c)(6) of H.R. 3048 authorizes the 
Copyright Office to prescribe by regulation certain identifying 
information concerning copyrighted works that may be contained 
in copyright management information protected under the bill. 
The Office would have to conduct a rulemaking proceeding in 
order to implement this portion of the bill. In this respect 
H.R. 3048 does not differ from the other proposals pending 
before Congress concerning implementation of the WIPO Copyright 
Treaty and WIPO Performances and Phonograms Treaty.
    Finally, one point of clarification regarding the role of 
the Copyright Office appears to be in order. Unlike the 
Congressional Research Service, the Copyright Office does take 
positions supporting or opposing legislation. These positions 
are based on our nonpartisan policy analysis, taking into 
consideration the underlying goals of U.S. copyright law. The 
Office has not, however, taken a position on H.R. 3048.
    In summary, the impact of this bill on the work of the 
Copyright Office would be minimal, and would, in our view, have 
a negligible effect on the Copyright Office budget.

    Are there any other questions of the Librarian or the 
Deputy Librarian at this point?
    Mr. Serrano. I will be submitting a question for the 
record.
    [A question from Mr. Serrano and response follow:]

  Documentary record of the relationship between Puerto Rico and the 
                             United States

    Question. Dr. Billington, in the past we have discussed the 
need to develop a detailed documentary record of the 
relationship between Puerto Rico and the United States. As the 
issues of self-determination for the people of Puerto Rico and 
the status of the Island have gained attention in Congress, 
this need is greater than before. Would you tell the Committee 
for the record about the Library's activities in this area over 
the last year or so?
    Response. The Library's Hispanic Division prepared the 
publication, ``Hispanic Americans in Congress'', 1822-1995 
(1995), at the request of Congressman Jose Serrano, and mounted 
the information on the Hispanic Division's Home Page. Fourteen 
of the 61 members listed in the biographic directory served as 
Puerto Rican Commissioners, and one currently is representing 
Puerto Rico in the U.S. Congress. In May 1997, the Hispanic 
Division began planning the digitization of Puerto Rican 
materials in order to share the Library's rich collections and 
providing research materials for students through the World 
Wide Web. Two parallel projects are in preparation:
    The World and Puerto Rico in 1898 will feature a 
comprehensive chronology from approximately 1868 through 1900 
illustrated with photographs of salient personalities, 
landscapes, and battle scenes; maps; printed texts; and 
manuscripts. These materials will be linked to relevant 
manuscripts, i.e. letters, diaries, etc. containing comments 
about Puerto Rican affairs in the collections of Theodore 
Roosevelt, Nicholas M. Butler, John Benson Foraker, etc.
    We are adding to the home page finding aids to various 
collections relating to this period, as well as title pages of 
salient books and journals. Relevant materials to Puerto Rico 
1898 already up in American Memory will be hot-linked to the 
chronology as will the Motion Picture, Broadcasting and 
Recorded Sound Division's listing of films of the Spanish-
American War.
    The American Memory Project for Puerto Rico will be made up 
of books related to Puerto Rican culture, history and biography 
published before 1925 (full texts of about 40 books are being 
digitized); the Alice Gould Puerto Rican Memorial Collection of 
rare nineteenth century pamphlets; and the Archive of Hispanic 
Literature on Tape, which contains literary recordings by 20 
Puerto Rican poets and prose writers. The Spanish-American War 
Digitization Project features a general chronology with 
digitized texts about Cuba, and Spanish materials on the 
Philippines and Guam. The Spanish-American War will be hot-
linked to the Puerto Rican Project, mentioned above. The 
Hispanic Division co-sponsored with the Governor of Puerto 
Rico's office on November 9, 1997, Evening of Puerto Rican 
Women Poets Reading Their Poetry in the Library of Congress. 
The Hispanic Division co-sponsored with the Puerto Rico Federal 
Affairs Commission an evening of Parranda de Octavitas on 
January 9, 1998, at the Library of Congress. The National 
Library Service for the Blind and Physically Handicapped has a 
regional library in Puerto Rico, which served nearly 15,000 
readers in the last fiscal year.

    Mr. Fazio. Same here, Mr. Chairman.
    Mr. Walsh. Thank you very much for your testimony.
    We have with us, in addition, Mr. Mulhollan with 
Congressional Research Service; Marybeth Peters, who just 
addressed us, from the Copyright Office and also Mr. Kurt 
Cylke, Director of the National Library Services, which 
operates books for the blind and physically handicapped.
    Why don't we give Mr. Mulhollan the opportunity to make an 
opening statement, if he has one to make, then we will give 
everyone the opportunity to ask any of those three individuals 
a question, and proceed in that matter.
    Mr. Mulhollan, Director of CRS is here, together with Ms. 
Angela Evans, Deputy Director. The CRS budget is $68.5 million, 
an increase of $3.9 million and 20 more FTEs. Why don't we just 
proceed, Mr. Mulhollan, if you would like to make a brief 
opening statement.

                                  crs

    Mr. Mulhollan. I have a short summary of the written 
statement I submitted for the record. I am pleased to be here 
today and I am grateful for the opportunity to talk about the 
1999 budget request for CRS. I would like to assure you that we 
will continue to focus our efforts on offering support to the 
legislative work for the Congress within the fiscal decisions 
you make.
    Mr. Chairman, Members of the Committee, the Legislative 
Reorganization Act of 1970 made it the statutory mission of the 
Congressional Research Service to provide the Congress with, 
and I quote, ``analysis, appraisal, and evaluation of 
legislative proposals,'' and estimating the probable results of 
such proposals and evaluating alternative methods for 
accomplishing those results.
    In other words, as actually another Member of the New York 
delegation says, Congress faces the problem of unintended 
consequences when it passes legislation. We are here to help 
you with that problem. The budget we submit for your 
consideration today is based on our statutory mission. To 
fulfill that mission, it is vital we maintain, without further 
diminution, our analytical and research capacity.
    To do this, we seek funding for three purposes. The first 
and most significant item is funding for mandatory personnel 
costs of the legislative civil service. Our staff constitutes 
90 percent of our budget. The second purpose is our succession 
initiative, which is designed to address a threat to our 
research and analytic capacity as more CRS staff become 
eligible to retire.
    As early as the year 2000, we will experience diminished 
capacity in a growing number of subject areas, including civil 
rights, transportation, crime and criminal justice programs, 
global climate change, monetary affairs and national security. 
By 2006, staff losses will affect virtually all areas of 
legislative support CRS provides to the Congress.
    The third part of our budget request is funding to cover 
price level increases for non personals which support the 
conduct of our research and the delivery of our products. With 
this budget request, I am confident we will be able to continue 
to provide the same high quality services within current fiscal 
constraints.
    In my written statement, I note that I provide you an 
update on technology. I won't elaborate here. I just want to 
state the Service remains committed to assisting the House and 
Senate to refine the legislative information retrieval system. 
We continue to work closely with both Houses of Congress and 
the Library to enhance the LIS so we can replace previous 
systems by the start of the next Congress.
    As my written statement emphasizes, we are making every 
effort to concentrate CRS resources on direct service to the 
Congress and take full advantage of existing and emerging 
technologies. It is, therefore, my responsibility to call your 
attention to possible consequences of a proposal which, if 
adopted, could divert our focus significantly away from the 
immediate needs of Members and committees.
    Legislation was introduced last week to make entire 
inventories of certain CRS products, notably reports and issue 
briefs, directly available to the general public, in fact, to 
the world, via the Internet. The decision is, ofcourse, yours, 
the Congress. But as our oversight committees and Congress as a whole 
consider the issue, I believe it is important to take into account the 
implication of a major change in congressional policy.

                  public dissemination of crs products

    Historically, constituents have gone to their Member of 
Congress when they have questions about legislation. As such, 
Congress has reserved for itself the distribution of CRS 
products to the public. To ensure this representational goal is 
carried out exclusively by Members, Congress has for many years 
included a provision in CRS annual appropriations, precluding 
us from publishing our products without congressional approval.
    Wholesale direct public dissemination of CRS products would 
bypass this long standing relationship between Members and 
their constituents. CRS believes such wholesale direct 
dissemination could have serious consequences for the Service, 
for our resource allocation, for our institutional culture, and 
for the legal framework within which we serve the Congress.
    Such dissemination would require us to divert scarce 
resources away from our statutory mission. Our analysts would 
inevitably shift the focus of their work from the concerns of 
Congress to address the very different perspectives and 
interests of the public issue advocacy groups, professional 
peers, and other organizations.
    Additionally, dissemination would bring into question the 
availability of speech or debate clause protection which 
undermines the presumption of confidentiality. This is so 
crucial to our relationship with the Congress. And, it will 
limit our ability to use copyrighted material. I would like to 
submit for the record a recent study that provides more detail 
on this important issue.
    [The information follows:]

[Pages 352 - 364--The official Committee record contains additional material here.]


    In summary, Mr. Chairman and Members of the Committee, CRS 
submits a budget that takes into account efforts throughout the 
legislative branch to adapt to continuing fiscal constraints. 
The goal of this budget request is to fulfill our statutory 
mission. I would be pleased to discuss any issues in detail and 
answer any questions. Thank you, Mr. Chairman.
    [The information follows:]

[Pages 366 - 374--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you. I have just two questions. In your 
budget request, the discussion and the implementation of the 
succession initiative is mentioned, the Librarian mentioned it 
also, as being very important, and the concept is very sound. 
The question that I have is, what is your FTE level, authorized 
level right now?

                          crs succession plan

    Mr. Mulhollan. 747.
    Mr. Walsh. Your current payroll is what, in terms of the 
number?
    Mr. Mulhollan. Right now I think we have--on board right 
now roughly 728. Every pay period that can change, because, of 
course, full-time equivalent is derived from paid hours worked. 
It is a useful accounting device, but we have a number of 
postings in place that would raise that closer to 747--much 
closer to that number.
    Mr. Walsh. Fairly simple math would get you to almost 20 
positions very quickly, within current authorized levels.
    Mr. Mulhollan. It is my understanding in fact, we currently 
would not have the funding to maintain 747 FTEs at our average 
salary level.
    Mr. Walsh. You don't really need additional authorization 
for more FTEs, you just need more money, basically.
    Mr. Mulhollan. For this year, that is correct. That would 
not be the case in the following year. But right now if I 
understand it correctly, the committee has not established a 
ceiling per se. Rather, the FTE number estimates how many full-
time staff could be supported by the budget.
    Mr. Walsh. Do you intend to use any of these positions that 
are about to be filled to begin to implement your succession 
plan.
    Mr. Mulhollan. The positions we will fill I can provide for 
the record, if you would like. Under the Graduate Recruit 
Program we have announced 15 positions. These represent our 
highest priority positions at this point, within the resources 
you have given us for this fiscal year.
    Mr. Walsh. I believe we funded 747 positions last year.
    Mr. Mulhollan. Well, for fiscal year 1997, we did not fill 
all those positions. We have approximately 740 altogether, 
including, those that are currently posted. We shifted, in 
fiscal 1997, a number of monies to contracts, to supplement 
staff expertise for a number of things.
    Mr. Walsh. So you opted to use those personnel funds for 
other needs within your budget, and that was a decision that 
the manager made.
    Mr. Mulhollan. That is correct. What we have for this 
coming year, under the Graduate Recruit are analysts in public 
finance, industry and finance, income maintenance, social 
security, immigration, natural resources policy, and 
agriculture policy. This is under current monies you have given 
us. We will be bringing people in for this summer on a 
competitive basis and we had very significant success with 
diversity in those positions in the past.
    Mr. Walsh. I don't mean to oversimplify, but you made a 
conscious decision that those were higher priorities than the 
succession plan.
    Mr. Mulhollan. During that fiscal year, we had to shift 
money for a number of positions into technology at that point. 
The Succession Plan is still the highest priority of the 
service in the long-term.
    Mr. Walsh. Is the number, 20, an absolutely must have or 
think you need to have or--how would you qualify that?
    Mr. Mulhollan. The number 20 for the first year and 60 for 
the whole succession plan is just part of a pool of identified 
people, 249 analysts, lawyers, and reference librarians that 
are leaving, so it is 24 percent of that total pool. This is 
only one of a number of things we are doing in CRS. We are 
looking at creative details, and with cooperation of our union, 
having people shift from lower priority to higher priority work 
within the Service itself, we are doing educational programs 
where we continue sending people to the war college, industrial 
college, to develop capacities within the organization.
    This effort is just one of a number of programs that we are 
trying to do to be able to work within the resources you have 
given us. Any help that the Committee can provide would be of 
obvious help, given the size of the number of people who will 
be leaving. And may I add, we have unique historical 
circumstances that we face. After the 1970 Legislative 
Reorganization Act was enacted, we were expanded by 2.5 times 
at that point, to meet Congress' needs for its own analytical 
capacities after finding, the door closed to Executive Branch 
information in a number of areas during the time of Watergate 
and Vietnam. A lot of the people hired then stayed. These 
people who are retiring are the people who built CRS as it is 
today.
    Secondly, there was significant reduction of legislative 
branch resources from fiscal year 1992 through the current 
legislative year. In CRS, we lost almost 100 people during that 
period oftime, so we weren't backfilling during the time. So it 
is a combination of a sizeable expansion of an agency, during that time 
and subsequent downsizing that creates the need for such a succession 
plan.
    Mr. Walsh. If the Committee were able to provide you with 
additional funded positions, would those absolutely be put into 
the succession plan?
    Mr. Mulhollan. Exactly.
    Mr. Walsh. That is a guarantee.
    Mr. Mulhollan. Yes, sir.
    Mr. Walsh. My other question related to the idea that Chris 
Shays has put forward and Senator McCain has also. First of 
all, this Committee would not make--this Subcommittee would not 
make that decision. It is an authorizing decision, as I 
understand it, and I am hopeful they will deal with it--they 
will give us some direction, rather than have us, at the end of 
this year, react to an initiative in the other body that really 
doesn't come through the normal process. What do you see as the 
largest pitfall to opening up CRS reports?
    I mean, the prevailing argument, obviously, is information 
is power and the more information people have, the more power 
they have, the more direct involvement they have, but what is 
the potential for abuse, if there is any, or if that is not the 
pitfall, what is it?
    [A question for the record from Mr. Cunningham and response 
follow:]

                     congressional research service

    Question. In FY98, you presented and Congress rejected your 
proposed succession initiative, to hire new people for a 
significant period to overlap analytical staff slated for 
retirement. I know we all appreciate your desire--our desire--
to sustain the intellectual capital of CRS. However, Congress 
rejected that proposal. Now you present it again in FY99. To my 
knowledge, the rather costly initiative you propose is not the 
general practice of business, the university, federal agencies, 
research institutions or congressional or committee offices 
themselves. What has changed to suggest that Congress should 
adopt this succession initiative this year, when we did not 
last year?
    Response. We have resubmitted the succession initiative for 
fiscal 1999 funding for a number of reasons. First, we 
understood that Congress' decision not to fund the succession 
initiative last year did not necessarily speak to the merits of 
the proposal but rather reflected the severe budgetary 
constraints on the Legislative Branch budget for fiscal 1998. 
Second, in many dozens of meetings I have had with Members over 
the last year, I have heard great concern over the impending 
loss of CRS experts on whom Members rely. In addition, many 
Members have expressed their support for the initiative the 
Service has shown to deal with this serious problem, as well as 
for the specifics of the plan. While we recognize that budget 
constraints are still a concern, as we move a year closer to 
those retirements, it is our responsibility to address such 
concern of Members, and to avoid, if at all possible, a 
significant reduction in our analytic support to Members.
    In developing the succession initiative, we have looked at 
other agencies, research institutions and businesses and did 
find succession models which focused on executive leadership 
development. We contacted agencies involved in the National 
Association of Public Administration (NAPA) study on Managing 
Succession and Developing Leadership: Growing the Next 
Generation of Public Service Leaders. We also looked at such 
highly regarded companies as, Motorola, Westinghouse, AT&T, 
Corning Glass, Hewlett Packard, Procter and Gamble. Because CRS 
senior analysts serve as the policy leaders for the Service in 
their issue areas, many of the elements of these plans are 
relevant. While no one model was a perfect match for CRS' 
circumstances, we used some common features of these plans 
which helped us with our plan development: e.g., mentoring, 
team-building, development of professional networks, 
communication and support of organizational values, and 
rotational assignments.

    Mr. Mulhollan. My basic concerns, as identified by our 
statutory mission is, we are here to help the Member of 
Congress in his or her job to represent their constituency. I 
believe that, in fact, it is an increasingly difficult job to 
do, because of the multiplicity of issues that have to be 
managed and the complexities of them. But at the same time, I 
think under representational democracy, as I mentioned before, 
it is important for the constituent to go to the Member.
    We encourage Members of Congress to use our material. In 
the survey we did last week, 350 Members of the House have Web 
sites. Some Members put up CRS reports on their Web site. That 
is terrific. That means we are there to help them. The Member 
makes the decision, the duly elected Member makes the decision 
to place the document up there. But two things are important. 
Members value knowing what kind of questions are being asked, 
on legislation, and with direct dissemination that may be 
missing, as well as the fact that it is the Member who is 
accountable.
    There is no direct accountability of the Congressional 
Research Service to the electorate. I believe that, in fact, 
direct dissemination could erode that connection between 
Members and constituents, and the loss of control of the voter 
which may be the most profound implication. There is also a 
threat to the speech and debate protection for the Service that 
has been the underpinning of our confidential role for the 
Congress.
    I am very concerned about any possible erosion of that 
confidential role because in the end, you can feel confident 
asking us whatever you need as an extension of staff because 
you know we are completely confidential. You do not want, 4 
years from now a confidential memo that I sent to you or to 
anyone here at the table to be on a court docket as a result of 
a discovery for litigation. The judgment of our counsels is 
that in fact there may be a threat under the current court 
rulings that have increasingly narrowed speech and debate 
protection to the legislative act.
    The courts have continued to say, because we serve solely 
Congress, we are protected by that. If we added another public 
mission at a time when the legislative branch is downsizing, I 
think there is a question of concern. I understand the 
motivation of Members wanting to get information out, and we 
will work with Members to provide whatever they want to provide 
to their constituents. Again, it is Congress making the 
decision.
    Mr. Walsh. With that, Mr. Serrano.
    Mr. Serrano. I have no questions, just one comment. I was 
also somewhat concerned about the question you just asked about 
this information. And I know it is a tricky thing because on 
one hand you don't want to withhold information from the 
public, but, on the other hand, that information is provided 
for our use and how we wish to let it out is a different 
situation.
    I can tell you, for instance, in the last 2 years, leading 
up to, hopefully, this year's vote on the floor, on a bill to 
allow Puerto Rico to determine its political future, many 
studies have been done on what citizenship would mean, what 
statehood would mean if it came in, and would they bring in 
Federal taxes within 24 hours, would there be a transition 
period. I can tell you that issue, unfortunately, is so 
politicized that if every word CRS wrote on research was put 
out, it would have created a situation totally out of control. 
Granted, somebody hearing me would say you are afraid of 
information being out.
    Mr. Walsh. That is the problem.
    Mr. Serrano. That is the problem, but it is information we 
generate by asking for it, you know, and I think what would 
happen, if they knew everything would be public, people would 
watch what they were asking for and we would debate with much 
less information than we have now. Or else you have some fully-
cooked, ready-for-consumption information floating out there. 
So I have that concern also. But I am one of those who uses 
your Service and will be using it during this debate this year.
    Mr. Mulhollan. Thank you.
    Mr. Walsh. Mr. Latham.
    Mr. Latham. I guess, as a more junior member of the 
Committee, who does not have extra staff paid for by the 
Committee, I am very jealous of keeping CRS as staff, because I 
don't have the additional staff person that you are blessed 
with. If you want to give one up, I would sure take it. But it 
is a real concern. And I certainly share your concern.
    I think the arguments you make about the confidence between 
the dialogue with staff and the confidence issue is very, very 
important, as far as I am concerned, so I would hope that we 
could be successful, and we will certainly work to try to 
defeat those types of changes. Isn't it a fact, you say it was 
part of the authorizing, the responsibility of the authorizing 
committee, we had a prohibition in the appropriations bill.
    Mr. Mulhollan. Since 1952, that is correct, sir.
    Mr. Latham. In fact, we have had some role over the years, 
so I would hope we could continue that.
    I also share your real concern about the quality and 
staffing levels that you have, because you can't do as good a 
job as if staff is providing you with some good information. We 
might as well disburse it everywhere because it won't be of 
much value to anyone.
    I think the quality of the work of the CRS has been 
tremendous, and that is by far your biggest asset, and, you 
know, I think it is essential that we replace these people, and 
we are in an unusual situation with 1970 and being hit at one 
time.
    In the conversation we had, you had talked about continuity 
in the future. Would you go into that a little bit, about how 
we are not just creating another dip down the road 20 years 
from now again?
    Mr. Mulhollan. Well, one of the things we had in planning 
this is that it is a 3-year plan, and it is only a portion of a 
number of efforts, including detailing, we are working on it. 
We are enhancing our capacity for a period of time, but the 
commitment is to go down to the current FTE level 747. So it is 
basically overlapping a 5-year--5 years and 5 years and 5 
years, and by 2006 we are committed to reducing our staff back 
to the same full-time equivalent level as we are today.
    Mr. Latham. Are we going to have the same problem in 25 
years?
    Mr. Mulhollan. No, because of the combination that it is 
only a portion of the additional hires are of that cohort at 
249, as well as the fact that it is spread over a more 
significant time and that we are using alternative methods as 
well. It is part of a packaged program trying to manage this in 
a responsible way.
    Mr. Latham. Your plan is to not only address the immediate 
needs, but also to eliminate the problem in the future.
    Mr. Mulhollan. That is correct, and, again, to Mr. Wamp's 
question, we are continually looking at how you will be working 
in the future and how we will be there to assist. One of the 
problems with specifying the Web site to be presented to the 
public that is currently in the proposed legislation is that 
technology is changing. Web sites are no longer presenting 
information as a narrative driven by an author, it is a 
question and answer forum, more and more you will be in 
dialogue with our experts. Our Web site was never meant to be a 
document delivery system primarily, and in the future it will 
likely be less and less as such.
    Mr. Latham. Okay. I just reiterate my appreciation for what 
you do, and I think for someone who is short staffed, it is a 
tremendous asset, I will tell you. That is all.
    Thank you, Mr. Chairman.
    Mr. Walsh. You made your points very clearly, Mr. Latham. 
We will make sure it is in the record.
    Mr. Fazio.
    Mr. Fazio. Two questions related to this, briefly. One, how 
is the internship program working in terms of turning up 
recruits? Are we getting a high percentage of people who would 
then fall under your apprenticeship program? And, secondly, and 
you may want to answer this together, how are we going to 
decide what services to eliminate? I know when we lose some of 
these people, we lose, in some cases, institutional memory that 
has to be replaced, but we also have a shift in priorities, 
people are asking different things of people with different 
expertise. So how are you going to be changing the mix of 
experts that you have on staff? What are we going to see more 
of and what are we going to see less of in terms of their 
ability to respond?

                       crs intern recruit program

    Mr. Mulhollan. We, by statute, are to assist all 
congressional committees, so we premise our expertise on the 
kinds of expertise that are necessary by legislation produced 
by the committees.
    First of all, with regard to different expertise needed, we 
have identified, a trend of an increasing need for quantitative 
skills. We had a trial run for our Graduate Intern Recruit 
Program this last year. As a result, we brought in summer 
interns from the various graduate schools across the country, 
from California, New York, Syracuse as well, though not the 
University of Iowa, we will work on that, Iowa State.
    Mr. Serrano. What is this, New York and Syracuse as well?
    Mr. Mulhollan. New York City.
    Mr. Serrano. Just checking.
    Mr. Mulhollan. They were a terrific group of people, and 
contributed across the board. Right now I can submit for the 
record, as mentioned, postings where we have aggressively 
recruited, and the top 12 graduate schools--excuse me, public 
policy schools in the country, 10 of those 12 we visited which 
have the highest minority graduate student population. We 
decided to do that also as a way to increase diversity. During 
the previous graduate recruit program, before it stopped, we 
had a 40 percent minority participation of the best and 
brightest in the country coming in to work for CRS.
    What we have here is an opportunity to identify, in the 
graduate schools across the country, those who are very capable 
in their disciplines, but also want to work in public service. 
The challenge we have oftentimes, is getting them motivated. 
They like the nonprofit sector, local and State governments 
instead, where they have more flexibility. So we have to strike 
them as an organization to be able to adopt quickly to change.
    We are continually looking at your needs and how Congress 
is changing, and I have talked to the committee before about 
how more decisions are being made in the budget and 
appropriation context, the devolution of Federal responsibility 
to the states, increased number of quantitative skills, we are 
also finding with the diminution of the executive branch a need 
to build a number of databases. The committees are turning to 
us for more substantive micro simulations, and modeling on for 
example S-chip, on the impact of temporary assistance for needy 
families, and for the development of a number of other 
databases that don't exist elsewhere that are needed to help 
determine the implications of the law.
    Mr. Fazio. Do you think OTA's elimination may have shifted 
some of that work in your direction?
    Mr. Mulhollan. There is undoubtedly some type of shifting 
going on with the demand for the perspective of the sciences. 
OTA had a much different approach towards issues; they were 
looking at the longer horizon. And we are still paying 
particular attention to the legislative cycle right now, and so 
with some exceptions--for instance, we did a study on passive 
smoking that would perhaps have been done by OTA. In that 
instance we brought in outside experts for that period of time, 
and we will be looking at other opportunities, but it is a 
resource issue because each study was roughly $250,000 of money 
spent and those kinds of resources aren't available to us.
    Mr. Fazio. Were those kinds of requests being responded to, 
where a more long-range analysis has been done?
    Mr. Mulhollan. That is an excellent question. I haven't 
done a study of it, although we could for you. It is a method 
in the scientific community. I note the House Science Committee 
feels it has been more assertive in trying to understand issues 
and looking at that as well, but we have hopes to increase our 
scientific capacity. For instance, on the graduate recruit, we 
are asking for an analyst in life sciences and an analyst in 
clinical biomedical research, those two positions, in our 
Graduate Recruit Program will be stepping stones toward 
building a commitment to greater capacity in those sciences.
    Mr. Fazio. Thank you, Mr. Chairman.

     national library service for blind and physically handicapped

    Mr. Walsh. Does anyone else have any questions of Mr. 
Mulhollan at this time? If not, we will excuse him.
    Lastly, I believe, we have Mr. Kurt Cylke, Director of 
National Library Service, which operates the books for the 
blind and physically handicapped.
    Welcome, Mr. Cylke. Your budget is up by $1.6 million, to 
$48 million, and if you would like to make an opening statement 
or if you have any comments you would like to make, please feel 
free.
    Mr. Cylke. I would like to make a brief comment.
    There are 3 million individuals in the United States who 
are eligible for service from the program. Two million of those 
are blind individuals and one million would be physically 
handicapped individuals. Of that universe, we serve 
approximately 778,000. We do this by circulating thousands of 
books, millions of books, each year.
    The blind community reads at approximately 30 books a year. 
We circulated 23 million books to the community last year. In 
order to read the audio books, we need machines, and these 
machines are, I believe, quite satisfactory--well-built. 
Statistics validate the fact that they last quite a long time. 
More than 33 percent are over 15 years old. They are not items 
you buy and throw away.

                          talking book program

    Last year, we requested that you permit us to acquire 
10,000 new machines to fill the void where machines are 
breaking. You courteously agreed to providing 5,000. This year 
we are asking for the other 5,000, if you could. This will 
round out our needs. It would ensure there will be no waiting 
lines and, hopefully, everyone eligible for service receiving 
it.
    Mr. Walsh. Well, we will do our level best to provide those 
additional machines. We felt 5,000 was pretty good last year. 
What had you been receiving in the past?
    Mr. Cylke. Five thousand is ``pretty good.'' It was half 
the amount we needed, without being facetious.
    Mr. Walsh. In prior years, how many of these were purchased 
in a year?
    Mr. Cylke. We purchased approximately--we actually 
manufacture--purchase is a code word for manufacture--we 
actually manufacture approximately 50,000 a year, depending on 
the monies available to us. That 50,000 is able to keep us at 
an even rate by shifting around from State to State without 
having waiting lines. The 10,000 we need to ensure that this 
situation continues.
    Mr. Walsh. What other new technologies are available, or 
becoming available, that might help to meet the needs of people 
taking advantage of the service now?
    Mr. Cylke. There are many and we are exploring them now. We 
have an in-house group called Technology Assessment and Review 
Process. The acronym for that is TARP. They are using the 
National Information Standards Organization (NISO) concept of 
developing a standard for the next generation, for the talking 
book machine. The talking book machine will most likely be a 
digitally based machine, and will be with us, we estimate, 
approximately 10 years off from now.
    When I heard Dr. Billington talk about the situations, the 
problems or what are the nature of things that are going to 
happen, you should know that there will come a time in the not 
too distant future, not immediately, not next year, but in a 
10-year period, where technology will change. I am just going 
to use a figure, we don't intend to do this, but if you changed 
our program today and went to, say, a CD-ROM, and changed all 
the software and all the cassette machines, you would have a 
$160 million problem. With a $160 million problem, we don't 
believe we should jump into it without due deliberation.
    It is a transitional technology and will not be here when 
we are ready. We are studying and using people from industry, 
blind users, you know, actual blind individuals and so forth. 
We do not anticipate change in the immediate future. However, I 
assure you the engineers and the best minds in the community 
are looking at the problem.
    [A question from Chairman Walsh and response follow:]

    Question. For the record, update the readership, 
acquisition, and machine data.
    Response.
    [The information follows:]

[Pages 383 - 391--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you. Mr. Serrano.
    Mr. Serrano. Just a question, if you speak about producing 
50,000 a year, and the original 10,000 and the number of people 
you are servicing, are you satisfied you are reaching out to as 
many folks as want the service?
    Mr. Cylke. I have to give that a qualified answer. Our 
policy has been from the beginning of the program to make the 
program available to those people who wish it. That is to 
inform people that the program is available, and if they wish, 
to have them take advantage of it.
    We have approximately--15 percent change each year. If you 
look at our statistics, you will see the user base only grows 
by about 3 percent but there is a 10 to 12 percent dropout. 
When I say dropout, I mean deaths. We have an older population; 
60 percent are over 65 years of age. So we lose approximately 
12 percent of our people through death and we grow by 3 percent 
so we are changing 15 percent every year.
    I am satisfied that we are reaching the great majority of 
people who wish to use a library program. I am not saying we 
are reaching everyone. We have not put on a massive public 
relations campaign. We have, in some cases and in some areas of 
the country, put on limited efforts to promote the program. It 
didn't seem desirable to go out on a mass, broad, wide scale 
promotion when funds are not available.
    Mr. Serrano. I would imagine in the same way teachers and 
other members of society and of the community inform people of 
the availability of libraries. It is probably no different in 
your situation.
    Mr. Cylke. We have a significant exhibit program. This 
program is exhibiting to those who deal with individuals who 
are eligible. We connect with medical associations, nursing 
associations, those organizations, such as represented by the 
people in this room today--the National Federation of the 
Blind, American Council of the Blind, and so forth.
    We are not putting on a massive newspaper, TV, radio, mass 
publicity campaign.
    Mr. Serrano. It is wonderful when your staff hands you a 
note that is exactly the next question you had in mind. They 
are usually one question ahead of me, so this is an improvement 
for me.
    How about services in languages other than English?

                       FOREIGN LANGUAGE SERVICES

    Mr. Cylke. We produce books, in limited quantities, in 
Spanish. We have a library in Puerto Rico. We also produce a 
few books in French, German, and Italian. The majority of non-
English language books we purchase. We are able to supply 83 
different languages. The ones that you might think of that--for 
example, Finnish. There are a few blind Finnish people who want 
to read that language, Swedish and so forth. We also have some 
of the languages in India, etc.
    Mr. Serrano. When you say you produce the books----

                           SELECTION OF BOOKS

    Mr. Cylke. Produce the books and machines.
    Mr. Serrano. So you select what books?
    Mr. Cylke. We select the books. That is done by a cadre of 
professional librarians selecting. We use an advisory committee 
and every year the group gets together, a representative of the 
American Council of the Blind, the National Federation of the 
Blind, the librarians who serve the program and others, to 
point us in the general direction of where users believe we 
need to put in an effort. Then we select the books ourselves, 
produce the books, word for word, cover for cover, and then 
they are dropshipped to the network of 140 regional libraries 
and subregional libraries around the country who provide 
service.
    Mr. Serrano. Is there any relationship between what the 
Government does, which is what you do, and the industry of 
books on tape?
    Mr. Cylke. We were the ones who inspired the books on tape 
commercial market. They are following our guidelines and doing 
an excellent job on it. We are exploring at the present time 
the concept of perhaps buying from them some of the best 
sellers, which would prevent us from having to expend the money 
on those, to put money into other places. That is ongoing.
    Mr. Serrano. You are trying to buy it, but that hasn't been 
okayed yet?
    Mr. Cylke. It is not a matter of being okayed or not 
okayed. There are many problems. Our cassettes, for example, 
are on half-speed, four-track format. We have a certain 
standard for pronunciation and level of accuracy. For the blind 
community, we put out a nonaccented, unaccented, standard 
English, nondramatic book. The blind community has indicated an 
interest in receiving a book that lets them put the emphasis 
where needed. Some of the books that are commercially available 
are of a different type.
    The other thing you should know is more than 95 percent of 
the books are abridged versions, you know, Moby Dick on two 
cassettes--it is not the same book.
    Mr. Serrano. Sounds like one minute on the Floor. But thank 
you very much. And I really commend the work you do and I will 
join the Chairman in attempting to work on that.
    Mr. Walsh. Mr. Latham.
    Mr. Latham. The reason I was late is because I was meeting 
with your customers.
    I am just curious, one thing, the 30 books per year, do you 
know what it is in the general population?
    Mr. Cylke. I believe, and I have a figure, it is less than 
two books, and three newspapers and one magazine. That sounds 
ridiculous, but that is what--if you look at the American 
population, that is what you are talking about.
    Mr. Latham. I would agree with that.
    Mr. Cylke. The American publishing organizations publishes 
those figures.
    Mr. Latham. That is why I enjoy meeting with your 
constituents every year.
    Mr. Cylke. I have been in the library business for 40-plus 
years and the good part of the library for the blind is the 
comments that we receive. In other words, the praise for doing 
a quality book, and the negative when we occasionally put out 
one which is not acceptable, either in terms of narration or in 
terms of technical quality or whatever. There is a significant 
amount of feedback. These individuals who are in the audience 
put us on report. It's a good feeling.
    Dr. Billington. One thing that is important, that is not 
generally realized, is that the abridged version for the blind 
reaches a very small audience. It costs money. It is something 
like 150,000.
    Mr. Cylke. I can't give you the number.
    Dr. Billington. Something like that.

                               BOOK COST

    Mr. Cylke. The costs are reasonable. I will throw out one 
number here. For example, when we publish, we publish a 
thousand copies of the book, but an audio book, one copy is 
$5.82. That is a pretty good price. If you went out and bought 
a print book you would pay about $29.95. I believe we put out a 
very high quality product, a low unit cost product which is 
appreciated by the users.
    Mr. Latham. Thank you.
    Mr. Walsh. Mr. Fazio.
    Mr. Fazio. I was going to go in the same direction Mr. 
Serrano did on the new phenomenon. I guess the busy American 
public is driving around listening to books, because you 
indicated they are not reading. I hate to think that somehow we 
couldn't marry those technologies and make that material more 
available.
    Mr. Cylke. As I said, we are trying to do that. We got to 
that point, actually, several years ago. We initiated a request 
for a GAO audit. As a result of that audit, they encouraged 
what we weren't even thinking about--the purchase of commercial 
books--that was one of the mandates. We have a group working on 
that. We should be ready within one year.
    Mr. Fazio. The one thing that disturbs me is people don't 
like to hear regional accents. But there is a certain richness 
about accents in America that people might want to hear.
    Mr. Cylke. It is not that they do not want to hear it. I 
indicated earlier more than 60 percent of our people are over 
65 years of age. With age goes hearing loss and difficulty in 
understanding. That is why they are nonaccented. If you get a 
regional book, we try to get a slight regional touch. If you 
are doing----
    Mr. Fazio. To Kill a Mocking Bird?
    Mr. Cylke. Yes, or the Friends of Eddie Coyle.
    Mr. Fazio. Angela's Ashes.
    Mr. Cylke. Yes. We had a narrator in New York, Patrick 
Horgan, who retired. He did a superb job with Irish.
    Mr. Fazio. You do good work, Kurt.
    Mr. Cylke. Thank you.
    Mr. Walsh. I would second that and associate myself to 
everything that has been said.
    Now I know who I owe thanks to. I was teaching for a couple 
years before I came here, in Utica, and I had an hour drive 
each way, so I devoured books on tape for that 2-year period. I 
would get home and my wife would look out, and I would be 
sitting out in the driveway, saying, what is he doing out 
there, and I would want to finish the chapter.
    Mr. Cylke. When I first entered the program, my wife found 
me in the garage with the doors shut listening to Moby Dick.
    Mr. Walsh. Anyone else?
    [A question from Chairman Walsh and response follow:]

                             reprogrammings

    Question. For the record, insert all reprogramming 
documents, and any other Committee approval actions.
    Response. These items are attached.

[Pages 396 - 421--The official Committee record contains additional material here.]


    Mr. Latham. I would like to say my wife has locked me out, 
too.
    Mr. Walsh. Well, enough is enough. Thank you all very much 
for your testimony and your thoughtful comments and responses 
to our questions. The meeting is adjourned.
                                       Wednesday, February 4, 1998.

                        JOINT ECONOMIC COMMITTEE

                               WITNESSES

HON. JIM SAXTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW 
    JERSEY
CHRISTOPHER J. FRENZE, EXECUTIVE DIRECTOR
    Mr. Walsh. The subcommittee will come to order. I would 
welcome my colleague Steny Hoyer on the Minority side. Is 
Congressman Serrano coming or are you filling in for him?
    Mr. Hoyer. I don't know.
    Mr. Walsh. He is at a caucus.
    Mr. Hoyer. We are in the midst of a caucus. I came over 
early. I think Vic won't be here because he is chairing the 
caucus.
    Mr. Walsh. Great. Good to have you with us. Good morning. 
Welcome. We welcome the Chairman of the Joint Economic 
Committee, my colleague and friend from New Jersey, Mr. Saxton. 
Welcome, Jim.
    Mr. Saxton. Thank you.
    Mr. Walsh. Good to have you with us. The Vice Chairman is 
Senator Connie Mack. He is not here. And the Ranking Minority 
Member is Senator Jeff Bingaman of New Mexico. I don't believe 
he is here, either.
    The staff director is also here, Christopher Frenze. 
Welcome.
    The budget justification material has been printed in Part 
1 which has been distributed to the Members. Mr. Chairman, your 
letter reflects a request of $2,796,000. That is a $46,000 
increase above the current level. Your staffing level will stay 
at 38. Please feel free to make a statement.
    Mr. Saxton. Thank you, Mr. Chairman. I have submitted some 
testimony for the record so I won't take your time by reciting 
all that.
    Let me say we are also accompanied by Colleen Healy, who is 
with the Majority staff, as well as Howard Rosen who works for 
Senator Bingaman, who is here with us.
    Mr. Walsh. Welcome.

                     Mr. Saxton's Opening Statement

    Mr. Saxton. Mr. Chairman, over the past several years, 
beginning in 1996, the Joint Economic Committee accepted a 
reduction of about 36 percent of our budget. Then in 1997 and 
1998 we had level funding which was at $2.75 million. This year 
we are asking for a 1.67 percent increase, just to try to hedge 
against inflation. Again, in real dollars we will have level 
funding or perhaps slightly a few percentage points below level 
funding with that kind of an increase.
    Let me just, without taking a lot of your time, say that 
our activities over the past year have been noted in such 
publications as The New York Times, The Financial Times, which 
of course is published in the U.K., The Wall Street Journal, 
The Washington Post and Time magazine. We have concentrated our 
efforts essentially in a number of areas, but let me just name 
three which I think are of particular importance:
    Our studies and analysis of tax policy, particularly 
personal saving and capital gains, has taken a fair amount of 
our time, along with studies that we have done on the 
distributional effects of the 1997 tax law. These have been 
studies that have been used by leadership and Members of both 
parties as well as members of the media and, of course, 
relating what we have studied and reported to the public at 
large.
    Secondly, we have done six studies on an issue which I 
believe is of great importance, particularly as we look at the 
period of economic growth in which we find ourselves. Some 
economists have now begun to talk about this part of our cycle 
as a wave, a growth wave rather than a growth part of our 
cycle. It is kind of interesting. Most economists today, or at 
least many, credit the Federal Reserve with having played a 
large part in bringing us to where we are.
    We have done six studies relative to low inflation and low 
interest rates, and I have also introduced legislation on what 
the Fed refers to as inflation targeting in order to, in 
effect, squeeze inflation out of the economy and at the same 
time have the effect of lowering interest rates. The 
legislation has been referred to the Banking Committee. We have 
seen a great boost to economic growth.
    Thirdly, we have recently been tasked by leadership to do 
an in-depth study of the International Monetary Fund, the IMF, 
obviously as an offshoot to what is going on economically in 
Asia. We are in the process of preparing a full report on the 
International Monetary Fund, how it works, and what we think 
are its weaknesses. We will be holding a hearing, incidentally, 
on the 24th of February on that subject, followed perhaps by a 
second hearing if need be. This is something that we anticipate 
will take a great deal of our time and effort during the next 
quarter, and perhaps over the next six months, depending upon 
what happens with respect to the IMF, as well as what happens 
to the Asian economies.
    We have been quite productive and have been able to do so 
at a greatly reduced budget. As you pointed out, I have with me 
today Chris Frenze, who is our executive director. Chris has 
assembled a great staff of economists and other support folks 
who have been very, very helpful.
    [The information follows:]

[Pages 425 - 429--The official Committee record contains additional material here.]


    Mr. Walsh. Obviously the work that you are doing is very 
critical to the Nation and to our decision-making. The IMF re-
funding will be coming up, I suspect, fairly soon, so the 
analysis that you have done will be very helpful to us. Your 
guidance of the economy thus far and your tutelage has been 
excellent. Keep it up.
    Mr. Saxton. We are doing well. A great investment.

                     fy 1999 hearing costs for jec

    Mr. Walsh. It is money well spent so far. We obviously 
focus more on the budgets than we do on macro and 
microeconomics, although the economics is much more interesting 
than the budget.
    Just one question, actually. You budgeted about $35,000 for 
hearings this year. Last year the hearing expenditure was very 
low. Is there a change in strategy here?
    Mr. Saxton. The change is in the way the Senate, as opposed 
to the House, does billing. On the House side, our records are 
kept and paid for out of other House accounts. When we move to 
the Senate side, as we do from time to time for hearings, we 
have to pay for those services out of our budget.
    While we hope to have the same low expenditure in the 
coming year that we did in the last year, we never know. It 
depends on how many hearings we have on the Senate side. We 
don't have a hearing room, incidentally, and so we get bopped 
back and forth.
    Mr. Walsh. So the scheduling, the number of hearings 
probably is not remarkably different than it was last year?
    Mr. Saxton. That is correct.
    Mr. Walsh. It is just a different accounting procedure?
    Mr. Saxton. That is correct.
    Mr. Walsh. Do you use consultants in your work?
    Mr. Saxton. We do. We have found that while we have a very, 
very competent and professional staff of economists of our own, 
it is cost effective on many occasions to look outside of our 
staff for the expert advice and researchers that we need. And 
so we contract with outside economists from time to time, and 
have found their work to be very good.

                   jec contribution to budget issues

    Mr. Walsh. Mr. Serrano. Questions?
    Mr. Serrano. Thank you. Nice to see you here.
    Just two quick questions. One you already began to speak 
to. That is at what point will you be asked to be involved in 
coming up with some comments about the broader economic issues? 
Any more information on that?
    The other question--I will put them both together--with 
various proposals still pending on changing tax codes and so 
on, what do you think the role will be of the JEC, what you 
will be asked to do?
    Mr. Saxton. Essentially, with regard to tax policy we do 
two things. Obviously, inasmuch as we have folks working for us 
who follow direction from the leadership, leadership may ask us 
from time to time to do analysis of tax proposals. In the past 
we have worked with Mr. Archer and others on the Ways and Means 
Committee relative to what it is they think they might like to 
do.
    Secondly, we also are cognizant of the fact that tax policy 
from time to time has a fair amount to do with the performance 
of the economy. We therefore will make suggestions on our own 
from time to time relative to tax changes that we think might 
bode well for enhanced economic growth.
    Mr. Serrano. Leadership has not really decided which way 
they want to go in terms of what tax plan to come up with. How 
will that affect your duties? You mentioned that you usually 
work with Ways and Means, but other plans are actually 
different from Mr. Archer's.
    Mr. Saxton. Ways and Means has currently scheduled three 
hearings relative to tax policy. They are seeking ideas. I will 
send them some testimony relative to some ideas that we have. 
And, frankly, you may have heard in the news in the last day or 
so that our savings rate is at a historically low level. But we 
have a very, very low savings rate, not only relative to other 
countries, also relative to the past performance in our own 
country.
    One of the ways to enhance saving is by giving people 
incentives in the Tax Code to save. One of the suggestions that 
we will have is that the IRA program, which is very popular, 
has been approximately the same maximum level in terms of what 
you are qualified to put away each year tax-free since the 
inception of the program, $2,000.
    We have suggested that that level be expanded, and we have 
also suggested that it will provide an economic incentive for 
people to save were they able to withdraw their money for 
purposes other than just retirement: for example, medical 
expenses, educational expenses, and any other worthwhile 
subject that Congress might feel would be a good thing to 
withdraw tax penalty-free.
    So this is the kind of a suggestion that we make. We do 
analysis, we refer it to the Joint Committee on Taxation for 
scoring, and hopefully that will be an idea that people will 
think is a good idea. Incidentally, the proposal that I just 
mentioned is co-sponsored by Marty Frost, so it is a bipartisan 
proposal.
    That is just to give you an idea of some of the things that 
we come up with on our own.
    Mr. Serrano. Good. Thank you.
    Mr. Walsh. Mr. Hoyer.
    Mr. Hoyer. Thank you. Jim, does the JEC make any budget 
estimates?
    Mr. Saxton. Our function is not to make budget estimates.
    Mr. Hoyer. I understand that is not the principal function, 
but do you make any?
    Mr. Saxton. In what respect?
    Mr. Hoyer. Is there any analysis made by the JEC early on 
in the cycle, like this month or next month, with reference to 
the accuracy of projections by CBO or OMB?
    Mr. Frenze. Every so often we look at that issue, but we 
don't do it in a formal way that is normally incorporated into 
the budget procedure.
    Mr. Hoyer. So essentially you don't issue any report or 
analysis of either the coming fiscal year or 5-year cycle, 
long-term?
    Mr. Frenze. We have done studies that looked at the 
accuracy of projections in the past, and occasionally we will 
report on the reasonability of projections offered by several 
different government forecasting agencies. But we don't as part 
of the budget process normally have a formal submission.
    Mr. Hoyer. Jim, you mentioned IMF. Have you issued any 
analysis since the failure to fund the IMF last year as to the 
consequences?
    Mr. Saxton. Nothing formal. However, there is a report in 
the works which we will be issuing in the next week or two. 
Frankly, one of the things that I think is greatly 
misunderstood by the public is that the funds that are 
currently in the International Monetary Fund are adequate to do 
everything that the IMF has proposed to do so far. There are 
funds that are still in the pipeline, so to speak. I believe 
there is something in the neighborhood of $8 million still due 
to be used in South Korea, and other funds are also in the 
pipeline for other countries. So the $18 billion--the $17.75 
billion, I guess it is, that is the subject of discussion here 
will be used for other contingencies in the future, but they 
are not contemplated to be needed for the current problem in 
Asia.
    Mr. Hoyer. So am I correct that the analysis will show that 
there was not a consequence?
    Mr. Saxton. There is no consequence to date, that is 
correct.
    Mr. Hoyer. In the economic analysis of the IRAs and the 
savings rate, obviously the savings rate has been low for a 
long period of time now in this country. I suppose there are a 
lot of analyses as to why that is the case.
    One of the reasons, as you know, that the IRAs were 
curtailed is that it was essentially concluded, as I recall, 
that there was no or not any substantial net increase in 
savings level as a result of the IRAs, and that in fact what 
occurred was a shift from one form of savings to another form 
of savings which had a greater tax advantage, but no net 
accretion to savings. Have you made an analysis of that?
    Mr. Saxton. We have seen studies to that effect. Frankly, 
we were quite critical of them. When the IRA, forgive me not 
knowing the exact years when these happened, but when the IRA 
was initially developed----
    Mr. Hoyer. You could use any year and I wouldn't know the 
difference.
    Mr. Saxton [continuing]. All Americans were eligible for 
IRAs. There were some rules that we were critical of relative 
to spouses, nonworking spouses in particular, but all income 
groups were able to take advantage of the IRA program. As time 
went on, Congress saw fit to put in place income thresholds 
which made IRAs available only to those people who were----
    Mr. Hoyer. Caps, you are talking ``less than,'' as opposed 
to ``greater than?''
    Mr. Saxton. Yes, only for those people who were less able 
to save than others. Therefore, we believe--I believe--that the 
results of the IRA program have been skewed by that part, of 
our population who are then able to take part, and those not 
able to take part. Frankly, we believe that the threshold--I 
believe that the threshold should be raised once again.
    I also think that the IRA program as it exists now is much 
less clear to the public than it was previously. That is 
because with the Roth IRA people have to, I believe, work 
through a couple of tax cycles before they will fully 
understand what the new program is all about.
    So I think as time goes on, if we are able to increase the 
amount of money that people are eligible to include in their 
IRA each year, and provide additional incentives by permitting 
withdrawals without penalties for other purposes, I believe 
firmly that it would increase the saving rate.
    Mr. Hoyer. Let me ask you something as a follow-up to that, 
so I understand what you are saying. What percentage of the 
American population has sufficient discretionary income to 
participate in IRAs? Have you made an analysis of that?
    Mr. Saxton. I don't know.
    Mr. Hoyer. I understand what you are saying and that is a 
very relevant point.
    Mr. Saxton. Do we have those numbers?
    Mr. Frenze. We don't have those numbers in front of us.
    Mr. Hoyer. Clearly we presume that the top 20 percent, I 
presume, of income earners would have discretionary income 
available to invest in an IRA. Beyond that, I am not sure where 
that line cuts. Have you made an analysis of that?
    Mr. Frenze. We could supply that for the record with 
specific data, but it is also true that there are a lot of 
middle class people who did use IRAs before, some of whom are 
not able to use them now. Some people at middle class levels of 
income have very high savings rates; some people at that level 
of income don't. It depends really on the taxpayer, with tax 
laws in general. As you know, the taxpayer's particular 
circumstances make generalizations difficult.
    Mr. Hoyer. If the Roth IRA doesn't encourage people who 
have some discretionary income to put--sock away some money, 
nothing is going to do it, because the Roth IRA is a very good 
deal in terms of exempting all interest and earnings 
thereafter. Jim, I guess your point is, because you can't 
deduct the principal that you put into a Roth IRA, that it will 
take a couple of years for people to realize what a good deal 
it is.
    Mr. Saxton. It is a great deal. A couple of questions that 
have floated around relative to changes the Congress makes from 
time to time, essentially is benefits on the Roth IRA are 
backended. Some folks are saying, ``Well, you guys change 
things from time to time. What if you change this program while 
I've got my money in it?'' So we have got to be vigilant on 
this, to make sure that the public has confidence in the 
program. I think it will be good; that it will work very well.
    There are two other points that I would like to make on 
this. A, the current Tax Code discourages saving. The current 
Tax Code taxes us when we have income, and then we save the 
income and it taxes the interest that we earn or therevenue 
that we derive from that income, so in a sense it is a way of taxing 
twice.
    Secondly, it seems to me that the American public today has 
lived through, all of us have lived through a period when the 
stock market has done very well. People have had perhaps modest 
savings that they have seen double in value and some say, 
``Well, golly I guess the stock market will take care of my 
retirement.''
    The realization is that the stock market may not always go 
up. The stock market could do some other things from time to 
time. It seems to me that it behooves us to mitigate as much as 
we can the prejudice that exists in our Tax Code against 
saving.
    Mr. Hoyer. I couldn't agree with you more. The Tax Code has 
historically encouraged debt and discouraged savings. You could 
deduct the interest you paid on debt and you had to pay taxes 
on interest you earned on savings. I think you are absolutely 
right. It is somewhat perverse.
    Let me ask you something. One of the controversial items 
that we had in the last Congress, as you recall, was the issue 
of whether or not, because the stock market had accrued value 
in pension funds, to allow pension fund owners to withdraw more 
on the theory that they were now overvalued.
    You recall that proposal, which obviously on our side we 
felt was a risk because of the exact point you raise, if the 
stock market went down and devalued the assets of the pension 
fund, that the pensioners--prospective pensioners would be at 
greater risk. Did you make an analysis of that at that time?
    Mr. Saxton. No, we did not.
    Mr. Hoyer. Mr. Chairman, I am sure I have taken more than 
my 5 minutes. I appreciate the time.
    Mr. Walsh. Very interesting questions.
    Mr. Hoyer. I want to say that I believe the chairman who 
appears before us is one of the more thoughtful Members of the 
Congress and does a great service to this institution as a 
leader of the JEC.
    Mr. Saxton. Thank you. Let me just mention, relative to 
this issue, former Senator Bentsen has also been an advocate of 
raising the cap on IRAs. So hopefully we can get something like 
this done on a bipartisan basis.
    Mr. Hoyer. I didn't vote for the 1986 tax bill, because of 
certain provisions in it I thought hit real estate too fast. I 
think that was proven. It couldn't change gears quickly enough. 
I think that led in part to the recession. There were some 
other things in there I didn't like.
    But having said that, I liked the objective of the 1986 
bill, which was to reduce preference items and reduce rate. 
Dick Armey would take it to a flat tax, which I don't agree 
with.
    But I think that in the 1986 bill, the information I had 
was that the IRAs were not creating savings, and therefore were 
simply an expenditure that didn't get us what we thought we 
were buying, and that is greater savings rates. I think that is 
an important question. You may be right, Jim, that the taking 
of the cap off, because you then reach more people with 
discretionary income who can then take advantage of the tax 
aspects of the IRAs, may make a difference. But then it will 
also have the perverse effect from some perspectives of skewing 
once again the distribution, which on our side in particular, I 
know on your side as well, is a concern.
    Mr. Saxton. Sure.
    Mr. Hoyer. Thank you, sir. Thank you, Mr. Chairman.
    Mr. Walsh. If there are no further questions, we will 
excuse our witnesses. Thank you for coming.
    Mr. Saxton. Thank you very much.
                                       Wednesday, February 4, 1998.

                        ARCHITECT OF THE CAPITOL

                               WITNESSES

ALAN HANTMAN, ARCHITECT OF THE CAPITOL
STUART PREGNALL, BUDGET OFFICER
HERBERT M. FRANKLIN, ADMINISTRATIVE ASSISTANT
ROBERT MILEY, SUPERINTENDENT, HOUSE OFFICE BUILDING
AMITA POOLE, SUPERVISING ENGINEER, CAPITOL BUILDING
LYNNE THEISS, EXECUTIVE OFFICER
HECTOR SUAREZ, HUMAN RESOURCES DIRECTOR
MARGARET COX, SENIOR LABOR RELATIONS ATTORNEY

                            Opening Remarks

    Mr. Walsh. We will now hear from the Architect. Mr. 
Hantman, welcome.
    Mr. Hantman. Good morning. Thank you, Mr. Chairman.
    Mr. Walsh. The Architect is making his second appearance 
before the subcommittee. We welcome him back. We acknowledge 
certainly the enthusiasm and vigor he has brought to this job 
and applaud that. Why don't we give you an opportunity to 
introduce your staff people.
    Mr. Hantman. I appreciate that, Mr. Chairman. Major 
witnesses include Stuart Pregnall our Budget Officer; Herbert 
Franklin, our Administrative Assistant; Bob Miley, the House 
Office Buildings Superintendent; and Amita Poole, our 
Supervising Engineer for the Capitol Building. Also, if these 
subjects come up, we have Dan Hanlon, our Director of 
Engineering; Lynne Theiss, our Executive Officer who is also in 
charge of the U.S. Botanic Garden project; Hector Suarez, our 
Human Resources Director; and Margaret Cox, our Senior Labor 
Relations Attorney, plus a cast of thousands. Also, Jack 
Boertlein, who is our Assistant Budget Officer, will assist me 
in pointing to some of the presentation boards that we have.

                           Opening Statement

    Mr. Walsh. I would just highlight the estimates we will be 
considering. Your total budget request is $185.5 million and 
1,403 FTEs. We have your prepared statement. If you would like 
to summarize.
    Mr. Hantman. Thank you, Mr. Chairman. I am pleased to once 
again appear before this subcommittee to present the budget for 
the Architect of the Capitol, one year and one day after I 
officially assumed my office on February 3, 1997. As you are 
aware, I have been immersed in learning and evaluating the 
complexities of this agency, while also initiating concrete 
action in response to Congress's imperative to provide cost-
effective, quality service in support of its day-to-day 
activities. I heard Congress's mandate ``loud and clear'' and 
have focused in on rebuilding this agency into a unified, yet 
flexible, responsive and quality-oriented instrument of the 
Congress.
    Mr. Chairman, I ask your indulgence because I have a two-
part presentation I would like to make today. First, I would 
like to take a few minutes not only to discuss our fiscal year 
1998 appropriation, but also to put it in the context of a kind 
of state-of-the-agency overview: where we are, where we are 
going. Some things are not quantifiable, Mr. Chairman, even at 
a budget hearing, but I think they are important to know and I 
would like to then specifically address the fiscal year 1999 
budget request.
    I will start with Capital Projects and where we are. We 
have been initiating the planning, the drawings, the contracts, 
the construction for work on the $33 million of capital 
projects that you very thoughtfully funded for us in 1998. This 
includes $3 million in projects under contract for design, such 
as ADA improvements projects, the Cannon garage, Rayburn 
Building telecommunications and fire sprinkler systems, 
legislative call system replacement studies. There are some $12 
million in projects under contract for construction, the Cannon 
Building modernizations, some $2 million; Capitol Building 
plumbing, smoke detection, fire alarms, et cetera, some 
$800,000; the last section of the Jefferson Building roof, 
elevator modernization in the House and in the Library of 
Congress, security infrastructure support projects.
    We also have some $18 million in project development; some 
$3.2 million in elevator and escalator modernization; $1 
million in a power plant east chiller replacement program. We 
will be requesting some $5 million in fiscal year 1999 for the 
first increment of what that design will be showing. Also ADA 
improvements, sound system improvements in the House Office 
Buildings, et cetera.
    Also we have completed construction documents for 
renovation of the U.S. Botanic Garden Conservatory. This 
project is now being advertised for bid. The contiguous 
privately funded National Garden is also in process and will 
follow shortly. Another very significant project is 
therehabilitation of the U.S. Capitol Dome. Initial portions of the 
study for necessary renovations of the Dome have been completed while 
others are still in process. This fiscal year 1999 budget recommends 
allocating some $7.5 million to perform the complex task of removing 
lead-based paint in the interstitial space between the inner and the 
outer domes and, after study, repainting that metal. This will permit 
us to make the necessary detailed inspection of all cast iron elements 
to clearly define the scope of work for subsequent phases.
    Listening to the news the last couple of days, I hear about 
funding for the Wilson Bridge. The Wilson Bridge, as you may 
know, is 36 years old, and they are looking at a $1.1 billion 
budget to replace the Wilson Bridge. We are talking about a 
140-year-old dome built of cast iron, that was modeled after 
St. Isaacs in St. Petersburg. This is a material that has not 
been used much longer than that and we really need to 
investigate what needs to be done with respect to it and do 
appropriate studies. We can talk in detail about that later if 
you would like, Mr. Chairman.
    On the Operations, Personnel Policies and Procedures side, 
we have initiated programs to select and begin the introduction 
of a computer-aided facility management system (CAFM), which 
will track, coordinate, record and evaluate work management 
cost and staffing data throughout the campus, as well as to 
provide enhanced space management systems and capabilities. In 
investigating this agency, there basically has been very little 
recordkeeping in terms of what it costs to do a project, how 
many man hours are spent on a project. This system will help us 
to quantify that and come up with databases that will allow us 
to more intelligently staff our projects and be responsive to 
Congress' needs to appraise us and see what we are doing with 
our dollars.
    We have also improved communications between the agency and 
our oversight entities, our clients, other arms of Congress, 
and clearly this is an ongoing effort. We have upgraded our 
internal administrative systems to achieve a year 2000 fix for 
our procurement, financial and inventory operations, and I 
believe we are the first legislative branch agency to have 
accomplished that. We are very proud of Stuart and his staff 
for having done that.
    We have initiated an agencywide strategic planning process. 
We facilitated initiatives with the House Sergeant at Arms, the 
CAO, as well as their counterparts on the Senate side, to 
coordinate services, eliminate overlapping functions, et 
cetera. And we are rebuilding our Human Resources Management 
Division to fulfill the imperatives of the Architect of the 
Capitol Human Resources Act and the Congressional 
Accountability Act. We have also created task forces to 
investigate alternative means of providing more cost-effective 
and quality services in many areas of this agency.
    I believe, Mr. Chairman, that it is important for the 
Congress to know the philosophical underpinnings of these 
efforts, the foundation we are building on, because there is 
really no quick-fix solution to what is needed in rebuilding 
and reengineering business practices in this agency.
    Through our strategic planning process, we are building an 
organization that will be able not only to support the day-to-
day workings of both Houses of Congress in an equitable and 
professional manner, but one that will go on performing its 
duties long after all of us in this room are gone. It is 
important for us to build not only for today but also for the 
future, not only in our capital and maintenance projects but 
also to build the proper team to perform the necessary day-to-
day functions and services of this agency. This includes 
developing the proper mix of in-house staff, vendors, 
indefinite quantity service contracts and temporary employees 
to be called upon as work load necessitates.
    We have a new ``vision statement'' which Jack will show us 
as we turn the first board. This was developed with 30 of our 
top managers sitting down talking about where we are, where we 
are going, what we need to be. The vision statement states that 
``We will be an innovative and efficient team, dedicated to 
service excellence and to preserving, maintaining, and 
enhancing the national treasures entrusted to our care.''
    [The information follows:]

[Page 438--The official Committee record contains additional material here.]


    The strategic planning process also produced a set of core 
values which we have on the chart beneath that. The first two 
core values deal with service excellence and stewardship. The 
next six really tell us how we can do that, dealing with 
integrity, professionalism, creativity, loyalty, respect and 
diversity, and teamwork. That is the only way we are going to 
be able to give this Congress the level of service that it 
really needs and be good stewards, in fact, for the national 
treasures we have here on Capitol Hill.
    Mr. Chairman, change is necessary to assure that this 
agency makes these values and the vision part of our corporate 
culture, so that all staff members truly make them the 
foundation of our work and the basis for how we do business day 
to day.
    Many issues were identified and mandated for change in the 
Architect of the Capitol's Human Resources Act and in the 
Congressional Accountability Act. These include the requirement 
to develop human resources management programs consistent with 
the practices common among other Federal and private sector 
organizations. We are working on that. This agency has begun 
many initiatives in the HR area and some of them are listed 
here in our budget request.
    The Congressional Accountability Act also created the 
Office of Compliance with the powers to monitor compliance 
within the intent of the act. It also granted the employees of 
this agency, among others on Capitol Hill, the right to form 
unions. As you are aware at this point, AFSCME Local 26 has 
been designated to represent over 600 of our custodial and 
labor employees and we are in the process of working with the 
union on a range of issues. I understand the union has just 
completed its elections. They now have a president and a full 
staff. I would like to congratulate all those folks and look 
forward to working with them.
    In order to address these realities and comply with these 
laws, this agency is undergoing an intensive review of all of 
its operations with a goal of continuously refining and 
improving the quality of our services to Congress and our 
visitors to Capitol Hill, while at the same time responding to 
the imperatives of the laws discussed above. As part of this 
review, we are investigating how to keep costs down and most 
efficiently deliver our services in fulfillment of our 
fiduciary responsibilities to the American taxpayer. This is in 
line with House recommendations over the past 2 years regarding 
future restructuring of this office. The recommendations 
included looking for sensible ways to streamline the 
Architect's operation and logical areas in which to involve the 
private sector; specifically, consideration of the private 
sector was suggested for routine maintenance and remedial work 
in addition to the major AOC projects.
    Our ongoing investigation therefore includes in-depth 
evaluations of logical areas in which to involve the private 
sector, internal opportunities to reengineer and consolidate 
our existing staff, and opportunities to eliminate duplication 
of services with other arms of the House and the Senate. If any 
of these initiatives involve staffing reductions, it is our 
recommendation that this agency be authorized to implement 
early out and buy out programs for affected employees. This 
type of program has been successfully used by the Library of 
Congress, the Government Printing Office and the General 
Accounting Office, which has shared valuable information with 
us on their recent efforts in reengineering. This is also a 
program which we successfully used this fiscal year in the 
Senate restaurants to eliminate consistent losses.
    There are three basic components to this review and this 
evaluation: impartial peer group benchmarking for best business 
practices, intraagency information gathering and assessments, 
and customer feedback. All of these are ongoing. We need to 
talk to more people, more Members of the House, more of their 
staff, more members of our own agency about what we are doing, 
what we are doing right, what we are doing wrong, and draw 
decisions based on that. These are discussed in more detail in 
section 5 of the statement.
    But I would like now to turn specifically to address our 
fiscal 1999 budget request. The operating budget that we have 
here, requested in 1999 is on the right side of this 
presentation board and it represents $153.8 million. On the 
left side of the board we see capital projects.
    [The information follows:]

[Page 441--The official Committee record contains additional material here.]



    This represents some $87 million, including $25.4 million 
for security projects which we will talk about in more detail 
later on. With respect to the operating budget, this is a 5.8 
percent increase over last year's budget. It would be 5 percent 
if we eliminated the election cycle move costs which we are 
going into for next November. But two-thirds of these cost 
increases relate to COLA's, mandated pay and benefits 
increases. Six percent of the increase is for an agency-wide 
uniform program, for which we are doing a pilot project now on 
the Senate side. In my mind it would make a lot of sense to 
have all of our employees in uniform, for the sense of 
uniformity and pride in the agency that it would give and 
security issues as well.
    As a service agency, of course, the largest component of 
this overall budget, 39 percent, is in pay and benefits. As I 
just discussed earlier, cost savings will be achieved through 
the reengineering plan formulated in fiscal 1998 and 
implemented after congressional review in 1999. We expect that 
there would be savings reflected in subsequent budgets. We also 
see in our operating budget the area of utilities, some 11 
percent, $21.9 million of that is for electrical service, $1.8 
million, for water and sewer, and $1.4 million for gas.
    In other services we have general maintenance and shop 
support, general administrative costs such as bringing in 
outside contractors to do air conditioning reviews. We also 
have private people coming in to assist us in the area of 
safety reviews, cost estimating, architectural engineering 
services and IRM computer services as well.
    We have a very significant decrease on the next chart. Let 
us take a look at that if we could please. This shows FTE 
employment.
    [The information follows:]

[Page 443--The official Committee record contains additional material here.]


    It indicates there has been a 16.4 percent reduction from 
1992 to date, a very significant decrease, and very many 
positive reengineering efforts have been made to try to achieve 
a continuation of quality service with that cut in staff. We 
have had shop consolidations to reduce the number of 
supervisors, we have cross-trained our work force so the second 
and third shifts in the HVAC shop would be able to handle 
emergency calls for both plumbing and electrical so we don't 
have to have those folks work also.
    We have job order contracts for small renovation projects, 
changing tours of duty for our folks to be able to deal with 
the reduced FTE count, temporary staff for seasonal and short-
term work. This chart, Mr. Chairman, represents a maximum, a 
maximum number of FTEs for fiscal year 1999. Let us go on to 
our next chart if we can.
    This chart which is our fiscal year 1999 operating and 
capital budget has two basic colors on it. The operations are 
shown in blue. As you can see, Mr. Chairman, the costs have 
been relatively level over the last 6 years. Most of the 
inflationary costs, costs of increased utilities, increased 
COLA's, et cetera, have been absorbed through decreases in work 
force so that we have a fairly constant level.
    [The information follows:]

[Page 445--The official Committee record contains additional material here.]



    The more significant changes have occurred in the capital 
side of the budget, in yellow. In fact in the fiscal year 1999 
budget, we see a major component is $25 million at the top of 
that bar for security-related projects. Let us take a look at 
the breakdown, if we could, of the capital budget itself.
    [The information follows:]

[Page 447--The official Committee record contains additional material here.]


    It is broken down basically into new facilities on the 
left-hand side which deal with the issue of security. That is 
$25.3 million or 29 percent and a very small $1.6 million in 
new projects for clients. The lion's share of this is in 
reinvestment projects, some 142 projects worth $60.4 million.
    Let me review, if I may, some of the projects involved over 
here. In life safety we are talking about $5 million for the 
east power plant chiller that has CFCs that by law need to be 
removed and replaced; $2.56 million in the Rayburn Building 
installing sprinkler and telecom cable systems; $150,000 for 
fire alarm systems, et cetera. There are some 30 projects in 
the life safety category.
    Under the title of cyclical maintenance, we have some $22 
million representing 65 projects. Major ones include $3.2 
million for the Longworth sixth and seventh floor roofs; $1.2 
million for the Cannon electrical and telecommunications 
system; a million dollars for the Cannon garage; $7.5 million 
for the Capitol Dome is in that category.
    Improvement in the AOC, the next category, of 13 projects 
for $3.6 million. There is $2 million for a co-generation 
facility which we can talk about later on; $250,000 for the 
snow melt system on top of the Capitol roof; $75,000 for 
lightning protection in the House Office Buildings; $100,000 
for humidification projects in the Ford Office Building, et 
cetera.
    The cyclical maintenance improvement projects deal with 
upgrading building systems, electrical telecommunications 
systems in the Cannon Building, sound improvements in committee 
hearing rooms on the Senate side, some renovations for 
mechanical and telecommunications in the Dirksen Building, et 
cetera.
    The proposed $20 million Capitol Square perimeter security 
project on the new project side has $3.5 million in it for the 
Senate Office Buildings themselves. We will be meeting with you 
this afternoon, Mr. Chairman, to review in detail that entire 
perimeter security project, and we can go into that in as much 
detail as you would wish now and a full presentation this 
afternoon.
    The reinvestment projects are basically broken down into 
seven categories. There are major categories such as life 
safety, cyclical maintenance, cyclical maintenance improvement, 
with ADA improvements, et cetera. The requested increase in the 
capital improvements portion of this budget is very 
significant, but the magnitude of the total for reinvestment 
cyclical maintenance projects is very much in line with the 
benchmark analysis we discussed last year. That analysis 
indicated that a campus-like complex of this age, this 
monumental quality and this magnitude could expect to 
conservatively expend annually approximately 1.7 percent of the 
replacement value of the buildings and the infrastructure.
    The next chart indicates some of the benchmarks that we 
have measured with.
    [The information follows:]

[Page 449--The official Committee record contains additional material here.]


    Clearly what we are trying to do here is to ask a 
reasonable question: How does anybody know how much we should 
reinvest each year in a campus of buildings as complex as ours? 
We can clearly look project by project, which is what we are 
doing, to see what needs to be done and let each project stand 
on its own. But the magnitude of the overall total budget is 
what this attempts to deal with.
    We estimate that the replacement value for our complex is 
in the range of $3.6 billion. If we take 1.7 percent of that, 
this is the type of budget that we are measuring against. That 
1.7 percent comes from the benchmarks that we got from the 
Universities of Illinois, Michigan, and Stanford that basically 
averaged out to about 1.7; Army Corps of Engineers has a budget 
objective of 1.75; the university Federal research cost 
recovery, the OMB, A-21, has a 2 percent figure. The IRS allows 
a depreciation of commercial property at 40 years, which 
translates to 2.5 percent on an annual basis. National Research 
Council of the Academy of Sciences has a low of 1.5 percent and 
a high range of 3 percent. Our request basically this year is 
1.7 percent of our estimated replacement value. Once again we 
are talking about reinvestment, cyclical maintenance costs 
without the security issues, without new facilities.
    The next chart has been updated from last year's budget and 
it shows this 1.7 percent annual reinvestment benchmark in 
blue. It contrasts it against actual reinvestment.
    [The information follows:]

[Page 451--The official Committee record contains additional material here.]


    We can see from 1993 to 1998, it shows that the blue has 
gone from $49.6 million in 1993, escalated at 3 percent per 
year, it goes to $57.5 million in 1998. This totals some $321 
million in potential need for reinvestment during this period. 
The red line plots actual reinvestment allocations, from $25.3 
million in 1993 down to $14 million in 1997, plus the $33.5 
million U.S. Botanic Garden emergency funding which brought it 
up to a total of $47.9 million. In 1998, it shows that our 
budget went to $33.7 million which this committee allocated, 
reversing the downward trend in recognition of the very real 
needs we all have to be responsible stewards of these national 
treasures. I think it is important to note, however, that the 
total reinvestment made in the Capitol complex between 1993 and 
1998 amounts to just under $175 million, or 54 percent of the 
$321 million benchmark for that period. The approximately $150 
million difference between the benchmark and actual 
expenditures accounts in my opinion for the pent-up need for so 
many long deferred projects that finally need to be funded.
    Frankly, I believe that we would be in a lot worse shape if 
the day-to-day maintenance efforts of our staff had not helped 
to extend the life of building systems and components well 
beyond what could reasonably be expected.
    Mr. Chairman, I have some photographs over here of air 
handling units in the Cannon House Office Building that were 
installed in 1937, renovated in 1965; 60 years later they are 
still in great shape, still pumping away, largely because of 
Bob Miley's effort and his wonderful staff. These are pictures 
of lots of these type of antiquated elements that are still 
performing good service, some of them well beyond, their 
expected life and some of them really need to be replaced at 
this point in time, much like the Wilson Bridge, although it 
has only lasted some 36 years.
    As this chart shows, our 1999 request for reinvestment 
funding is within 2 percent of the $59.3 million benchmark, 
which again is just a guide. Each project once again must stand 
on its own merits, must be evaluated in that sense, but we 
stand ready, Mr. Chairman, to discuss the validity of each of 
the projects at your convenience.
    The next chart shows that we categorized the projects into 
life safety, ADA, security, et cetera, for the specific purpose 
of prioritizing them, for taking a look at what we can afford, 
what we need to do, and making intelligent judgments with 
respect to that.
    [The information follows:]

[Page 453--The official Committee record contains additional material here.]


    I readily acknowledge, Mr. Chairman, that the amount 
requested is large, and I understand the pressure to achieve a 
balanced Federal budget in fiscal year 1999. As you are well 
aware, however, the needs for these projects don't go away 
since they are needed to maintain our aging infrastructure. In 
fact, more than $8 million in unfunded projects from fiscal 
1998 are again requested in fiscal 1999, adding to the total.
    Of course, adding to the total are major unanticipated 
costs such as the Capitol Square perimeter security improvement 
project, which was not defined the last time I met with you 
gentlemen, as well as the ongoing studies of the necessary 
repairs and repainting of the Capitol Dome. These two projects 
alone account for $27.5 million of the fiscal year 1999 budget.
    Mr. Chairman, I apologize for being overly long. It is a 
very complex budget. There is a lot to talk about, and I would 
welcome the opportunity to discuss and answer whatever 
questions you have.
    [The information follows:]

[Pages 455 - 484--The official Committee record contains additional material here.]


                            overall increase

    Mr. Walsh. Thank you. You shall have that opportunity. 
Thank you for your opening statement and the vision that you 
have provided. You have taken not only a very workman-like 
approach to the job but also a visionary approach and combined 
the two. I think that is remarkable. It also may be a little 
unrealistic, but we will talk about that.
    Let me begin by making just a few general observations. 
This budget asks for $58.3 million more than last year. That is 
a 45, almost 46 percent increase. Without getting into the 
merits of specific projects, one would have to question whether 
that is a realistic expectation, given the fact that this 
subcommittee was, in effect, forced to control spending to the 
degree of about a 1 percent increase in last year's budget. You 
are in a pool with the GAO, the Library of Congress, the 
Congressional Budget Office, the Capitol Hill Police. If you 
were to receive a 45 percent increase in your budget, do you 
realize what that would do to their budgets? I would just like 
to have you comment. Part of your vision statement is 
integrity.
    Mr. Hantman. Absolutely.
    Mr. Walsh. Credibility is a key aspect of that. Just your 
general feeling about this rather remarkable increase.
    Mr. Hantman. As I reviewed the budget patterns, Mr. 
Chairman, of the last 6 years, it really became obvious that 
there had been a hesitancy on the part of this agency to 
request funds necessary for the proper stewardship of our 
buildings and our infrastructure. During this period, there has 
been a consistent reduction in the capital funding levels 
requested and appropriated. This benchmark of 1.7 percent of 
replacement cost was developed to give us a way to measure the 
magnitude of reinvestment we might need to make in our aging 
infrastructure just to maintain it at a constant level.
    The benchmark percentage of our $3.6 billion amounted again 
to $320 million. We just talked about that. This really left us 
with a backlog of projects that need to be done. That is where 
the $150 million I discussed came, on top of the $60 million on 
a year-to-year basis. It bears no relationship, clearly, Mr. 
Chairman, to the budgets of last year, the year before, the 
year before that. I frankly believe that I would be doing this 
committee, the Congress and the American people a disservice if 
I didn't bring these very real needs to your attention, even 
with the severe budget limitations that we have. All 160 
projects have been prioritized and I would welcome the 
opportunity to review in detail, each one of them.
    Clearly, we have been putting things off. Some will again 
most likely have to be put off again. But I think we need to 
put them on the table. I can't, Mr. Chairman, be an ostrich, 
hide my head in the sand and say this is what we have been 
doing; therefore, this is what we should be doing.
    We have a real pent-up need to take care of some things 
that have not been taken care of over a prolonged period of 
time. So from my basis of integrity, I am sharing the 
information with you and I fully understand the budgetary 
problems. But we should know what the issues are, what the 
ramifications are, and go forward from there.

                             capital budget

    Mr. Walsh. Fair enough. This $58.3 million increase, just 
take the capital budget for a second. The expenditures that you 
have proposed, given the baseline--and I asked you to provide 
us that last year and you did--that 1.7 percent figure. What 
does the increase, or what does your expenditure in capital 
come out to be in terms of percent of the overall physical 
plant value?
    Mr. Hantman. It is 1.7 percent, sir, based on $3.6 billion 
as an assessed value.
    Mr. Walsh. For this proposed budget, it is 1.7 percent?
    Mr. Hantman. That is correct. Last year it was 1.4 percent. 
Is that correct?
    Mr. Pregnall. That is correct. That excludes the funding 
request for new facilities and security improvements, Mr. 
Chairman.
    Mr. Walsh. It is excluding the security improvements?
    Mr. Hantman. That is correct.
    Mr. Walsh. So if you put those in, wherever you--
    Mr. Hantman. Again, in my mind in trying to develop this 
benchmark, Mr. Chairman, it is very difficult to measure where 
we should be.
    Mr. Walsh. It is capital budget, though?
    Mr. Hantman. It is capital budget, but when you look again 
at what we need to do here in terms of budget, this is unique 
to the capital budget. The Botanic Garden conservatory last 
year was unique to the capital budget.
    Mr. Walsh. I understand.
    Mr. Hantman. In terms of reinvestment to stay level, not 
build any new structures, the 1.7 percent holds. A new project 
such as the Capitol security really has no relevance to that 
benchmark in my mind because it is a totally new project, as 
would be a new visitors center if we were to fund it.
    Mr. Walsh. I can understand how you have been separating it 
in your mind, but it is a luxury to think that a capital 
expenditure is not part of that overall expense.
    Mr. Hantman. It truly is. I was just dealing with the 
reinvestment portion of our budget.
    [A question from Mr. Cunningham and response follow:]

    Question. I would like to address the matter of capital 
projects for the Capitol campus. I agree that cyclical 
maintenance is an often-delayed expense. You describe a 
``benchmark'' analysis that concludes that an amount equal to 
1.7 percent of the replacement value of buildings and 
infrastructure should be expended each year to assure adequate 
cyclical maintenance. By what process do you estimate the 
Capital campus' replacement value? By what standard, other than 
simple comparative estimation that neglects the unique 
characteristics of the Capital complex, do you arrive at the 
1.7 percent figure for annual cyclical maintenance expense? Is 
not the 1.7 percent standard essentially arbitrary, so that 
worthy projects and otherwise can be stacked up to meet or 
exceed that figure?
    Response. The Capitol campus' replacement value of $3.6 
billion was estimated by taking the actual construction costs 
of all facilities and inflating them to current dollars. The 
Consumer Price Index was used to inflate all costs through 1912 
and thereafter the Construction Cost Index was used. Included 
in the base construction costs were all original building costs 
plus the cost of adding new systems or improvements. We are 
currently reviewing other methods of estimating current 
replacement cost, including using the new Ronald Reagan 
Building as a basis and a methodology developed by the General 
Services Administration used in developing budget estimates for 
new facilities. Based on our preliminary data, we believe that 
the $3.6 billion is a realistic number that if anything is 
somewhat conservative.
    The 1.7 percent was derived from applying methodologies 
developed independently by the University of Illinois, 
University of Michigan, and Stanford University for determining 
required cyclical maintenance as well as discussions with the 
Army Corps of Engineers. In addition, literature from the 
National Research Council of the Academy of Sciences cites 
cyclical maintenance reinvestment percentages in the range of 
1.5 to 3.0 percent of the current replacement value of a 
facility. Based on our analysis and other literature, the 1.7 
percent is a conservative percentage. Because the percentage is 
applied to the replacement cost of the Capitol complex, it 
takes into consideration the unique characteristics of the 
facilities. The AOC's capital budget request was developed and 
should stand on a project by project basis. The benchmark 
analysis is a tool that provides an indication of an average 
annual funding level that should be reinvested in the existing 
infrastructure.

                            staffing levels

    Mr. Walsh. We realize that the plant must be maintained and 
improved when necessary, but the care of the maintenance 
program must also be compatible with the realities of our 
budget. Probably just as important, it must fit the 
capabilities of your staff to carry out the program. Assuming 
that we were to fund this request, 45 percent growth is more 
than any organization can handle. Have you taken that into 
consideration?
    Mr. Hantman. Yes, Mr. Chairman. One of the line items under 
other services includes the ability for us to go out and bring 
in architectural, engineering, construction services to work as 
adjuncts to our existing staff to handle such an increased 
load. We fully recognize that our existing staff would not be 
capable of handling the load that we are working on for this 
year and such an increase for next year as well. We need to be 
better managers. We need to bring in outside consultants who 
can help us manage, and we need to manage them. I think that is 
basically the only way that we would be able to achieve control 
over the level of projects we are talking about.
    Mr. Walsh. If you can take on an additional 45 percent 
workload with existing staff, the obvious question is: What are 
they doing now?
    Mr. Hantman. Which is why I responded that our budget does 
include dollars for outside consultants to be brought in for 
our existing staff to monitor them.
    [A question from Chairman Walsh and response follow:]

    Question. In the Capitol buildings appropriation, you are 
requesting $33.2 million in the operating budget and $22.2 
million in the capitol budget.
    Of the $33.2 million, you are asking for $16,984,000 to 
payroll 388 FTE's. That's a 22% increase to pay 6 less staff 
than employed in 1997. Federal pay has not increased by 11% per 
year. Can you explain this large increase?
    Response. The increase in funding request in fiscal year 
1999 over actual 1997 reflects two areas of increase. First, 
there are increased costs for cost of living adjustments for 
both general schedule and wage grade employees as well as the 
pay adjustments for the statutory positions effected in 1998. 
The apparent 22% increase between the fiscal year 1999 request 
and the actuals for fiscal year 1997 is due to the fact that 
many of the top level positions in the Architect's office that 
are paid from this appropriation were vacant for all or part of 
1997. Fiscal year 1997 was a transition year in the sense that 
the congressional search for a new Architect of the Capitol was 
underway, and several critical staff slots were left unfilled 
until the new Architect was named. Included are positions for 
the Architect of the Capitol, Assistant Architect of the 
Capitol, Director of Personnel, Assistant Director of 
Personnel, Head of Electronics Engineering Division, Head of A/
C Engineering, Supervising Engineer of Capitol Buildings, Legal 
Counsel, and several other general schedule staff engineers, 
computer specialists, personnel, and administrative positions.

                          private contractors

    Mr. Walsh. Who is going to manage those projects? Would you 
manage them with outside contractors? Or would you just have 
the work done by outside contractors?
    Mr. Hantman. The work would have to be done by outside 
contractors. They would have to largely be managed by outside 
architects, engineers, construction managers as well. Our 
people need to change something of their orientation as opposed 
to implementing projects hands on, day to day; they need to be 
managers of consultants. That again is the only way that we 
could--your question is an excellent one--be able to manage an 
increased workload such as this. We have no intention of adding 
to our staff at that level. The workload is very significant. 
That is, I think, the only way that we could accomplish it.
    A point that Stuart makes is also the contract managers 
themselves are charged against the projects, so it doesn't come 
into our personnel costs.
    Mr. Walsh. Be a little more difficult to control costs that 
way?
    Mr. Pregnall. Mr. Chairman, our Construction Management 
Division hires project managers, inspectors and so forth to 
handle each individual project. Those staff costs are charged 
against the construction project itself. When the project is 
completed, they are released and go back to the private sector 
or wherever they came from. There is an element of quality 
control that the government has to assume to make sure that 
those funds are expended properly.
    Your point about cost management is well taken; a $30 
million capital program is significant. A $60 million capital 
program is even more significant. There is an awful lot of 
money to control there and manage.

                      botanic garden conservatory

    Mr. Walsh. I will get to some questions about the Botanic 
Garden project, but it is clear that there has already been 
some slippage in that project in terms of the timing and 
deadlines and key dates and so forth--not unreasonable, and I 
will give you the opportunity to explain that--but with this 
volume we are talking about, asking that we fund 114 new 
capital projects which will be added to 73 ongoing projects 
that have been already funded, all this will be in addition to 
your routine care and maintenance workload. That is an 
astonishing increase and obviously begs a number of questions.
    Let me ask a couple of questions about the Botanic Garden, 
if I may. By the way, I have your Web site book marked, and the 
Botanic Garden project, and I am watching it that way and that 
is helpful. Could you give us a status report on the Botanic 
Garden project?
    Mr. Hantman. Maybe, Lynne, would you like to? Lynne Theiss.
    Ms. Theiss. At the present time, we have advertised in CBD 
which is our requirement for procurement. The ad went out on 
February 2. Opening the bidding process, getting in the 
solicitations from the different companies, the general 
contractors, will be done during the month of March. Bid 
packages will then be going out to them. At that point we hope 
to start bid evaluations by the end of May, beginning of June, 
with awarding in June.
    At the time, the information that you were provided when 
the original request went through did not take into account the 
consolidation of the four phases of construction documents. 
That is one of the things that has caused the time delay. We 
had to take the four phases of the construction project and 
roll those into one package. I think at the same time our A&E, 
consultants DMJM, had to reassemble their own architectural 
team again so they could assist in the review process.
    Mr. Hantman. Because the design was stopped back in 1995?
    Ms. Theiss. Right.
    Mr. Hantman. Some people went on to other projects, were no 
longer available, so they had to reorganize their staff to 
complete the construction documents which had not been 
completed at that time. Also I think there were engineering 
problems.
    Ms. Theiss. We had some engineering problems. Since 1995 
some new OSHA regulations were developed which affected the 
structural revamping: things like the roof load had to have a 
5,000 pound stress factor so if we were doing any work on the 
roof, then we could do the maintenance properly and have safety 
factors in that. We also have the integration of the entire 
security system with the Capitol Police as part of an 
engineering design process which is still under way.
    Mr. Walsh. It is safe to say these sorts of things can 
happen with these new projects, too. It is certainly a 
consideration.
    Ms. Theiss. Exactly.
    Mr. Walsh. Let me give you some dates and let you respond 
to those. Last April we were learning about the emergency 
conditions at the conservatory. Your office provided a time 
line schedule that indicated the contract would be awarded by 
January 9, 1998 and that construction would be completed by 
October 1, 1999. That was the information we had when we added 
$33.5 million to the supplemental bill.
    Then, after the 1997 supplemental was enacted, an August 
fact sheet estimated that the procurement phase would be 
finished by March 13, 1998, with construction scheduled for 
completion between March 13, 2000 and October 13, 2000. That is 
a slippage of 2 months in the award date and almost a year in 
the completion date. Early last month we were told the award 
now would be made in June.
    Ms. Theiss. Yes, sir. I was not part of the original 
presentation so I'm not sure how some of the things you 
mentioned were assembled. The award process is a 90-day 
process. It is a 30-day advertisement, saying that we are going 
to put a procurement package out, and then we have limited this 
one to 60 days. That is why we can say a June award.
    The construction project itself has always been a 24-month 
construction project and a 3-month replanting project. One of 
the things that also has to be taken into consideration is the 
seasonal implications of putting plants in during the winter, 
doing renovations during the winter, abatement projects, and 
that sort of thing.
    Mr. Walsh. The committee would like to receive periodic 
status reports on this project.
    Ms. Theiss. We would be happy to.
    Mr. Walsh. Use the same format frequency that was used for 
the library renovation project. We would also like to see all 
milestone completions compared with the original timetable 
established for the project.
    Ms. Theiss. Certainly.
    Mr. Walsh. This is really the first major project certainly 
for this subcommittee under the leadership of myself and Mr. 
Serrano. I think we would obviously like to have this one done 
on time and under budget if possible.
    Mr. Hantman. Absolutely.
    Mr. Walsh. I can't speak for Mr. Serrano. I would assume 
that is his view as well.
    Mr. Serrano. Absolutely. And with no problems. It would 
look bad on our resume.
    Mr. Walsh. I have some more questions, but I will go to Mr. 
Serrano now and give him an opportunity.

                            CAPITAL PROJECTS

    Mr. Serrano. Thank you. Thank you, Mr. Chairman.
    The chairman asked you a question about your request. I 
thought it was a good question, dealing with the fact that 
other people know they can't request increases above a certain 
amount. Your answer I thought was also excellent in suggesting 
that you can't hide, you have to tell us what is wrong and then 
we have to make decisions along with you as to what to take 
care of.
    With that in mind, is there an impending doom that if some 
things are not dealt with, it would create major problems for 
what you have to do? In other words, are there some things that 
you say, listen, if we can't do this, we have to do this, 
otherwise we will have a major problem in a year or two, or 
five?
    Mr. Hantman. What we have done is really take a look at not 
only the categorizations of life safety, ADA, in and of itself 
which gives us a sense of a level of importance, but within 
each category we also have, within life safety, prioritized 
what is 1-A, the highest priority items that we need to take 
care of, what is 1-B, 1-C what is a level 2, a level 3.
    Our budget is structured so that if we want to eliminate 
everything in the 3 category, in the 2 category, we can do that 
depending on what reasonable level of budget we canachieve. So 
we can go down each of those categories, again, life safety, cyclical 
maintenance, ADA criteria, look at each individual project, see which 
of them are priority 1-A, need to be done now; 1-B what we would like 
to do, projects we think are necessary; 1-C maybe can be dropped off. 
We have those levels.
    So it has been prioritized and cut in several different 
ways, so we can again sit down and talk about 160 different 
projects and see which ones we really do feel are the most 
critical and which ones we think are important to do, but if we 
haven't got the funding clearly we can't do them.

                        LONGWORTH BUILDING ROOF

    Mr. Serrano. Right. But are there any that always sort of 
jump out at you, where if you don't take care of them over a 
period of time, it would create a major problem?
    Mr. Hantman. You are showing me level 2. I think Mr. 
Serrano is talking about the most important ones.
    Mr. Pregnall. For example, Mr. Serrano, under priority 2, 
cyclical maintenance, replacement of the Longworth roof at the 
6th and 7th floors. There are some leaks in that roof today. If 
the project is deferred----
    Mr. Serrano. Today. Meaning today?
    Mr. Hantman. Probably today.
    Mr. Walsh. Especially today.
    Mr. Pregnall. We can defer that project certainly. But that 
roof replacement then becomes a need for next year. At some 
point that has to be dealt with. We can continue maintaining, 
as the air conditioning system that you saw the photograph of, 
but at some point the life expectancy of that system is gone 
and we need to replace it.
    There is a judgment call here that we need to work out with 
the committee. Can we continue maintaining that roof for 
another 3 to 5 years? Certainly. That maintenance cost 
increases. But does the need to replace the roof go away? No, 
it does not.
    Mr. Hantman. As long as again that doesn't interfere with 
structural problems, rusting out the steel below.
    Mr. Serrano. What I am wondering, Mr. Chairman I know we 
are faced with on this Committee, perhaps more than any other 
committee--but a lot of folks will say, hey, don't spend more 
than $1.50 this year if we don't reach a point where they break 
the request down and come up with a few things where they say, 
``Look, this is what we think we need in order to do everything 
we think should be done, but if we don't take care of these 3 
or 4 items, we are going to have a major problem here soon.''
    Certainly they have singled out one here which is a major 
problem. I am wondering if that will allow us, allow you the 
ability to go to some folks and say we have some pending crises 
here. They may say, okay, or they may even see it as something 
that needs to be done. I am just wondering if that is an 
approach we should look at in the near future.
    Mr. Walsh. If I might respond, obviously the case of the 
Botanic Garden, that was clearly the case. It was dangerous. It 
had to be closed because of the danger, because of the OSHA 
violations, the ADA violations, and the imminence of danger 
forced us--allowed us to get it done. But I would suspect that 
if you only gave us projects like the Longworth roof and the 
Cannon garage decks which have big holes in them, I am sure you 
have seen them, probably their concern is those are the only 
ones. Our problem is that we are going to have to justify 
whatever we do, whether it is imminent danger or just makes 
good sense to fix it.
    [A question from Chairman Walsh and response follow:]

    Question. Wouldn't it be reasonable to give us a request 
for all needed roofing at Longworth, rather than 3 (or more) 
projects and in separate years?
    Response. The Ways and Means and Cafeteria roofs are on 
lower floors of the building and are not associated with the 
Sixth and Seventh Floor roofs, therefore, there is no advantage 
to doing the replacements at the same time. Administratively 
and logistically it is probably easier to do this work in 
separate years.

                                security

    Mr. Serrano. You mentioned security. Security to me always 
has two meanings. It is the ongoing security and the special 
needs, new problems security. What are you talking about?
    Mr. Hantman. We could demonstrate that if you would like, 
the perimeter security plan. Basically it was developed through 
the Capitol Police Board, with outside consultants taking a 
look at what we need to do to protect the Capitol building 
itself.
    Right now the walls, the planters that are stuck on our 
walkways are falling apart. They don't represent a very real 
barrier to anybody who truly wanted to get through them. The 
concept is to come up with a system of bollards, which are 
those metal elements that we see at the White House protecting 
the gates over there to prevent trucks, and cars from crashing 
through and coming through the Capitol.
    We try to give as big a standoff distance as we can to the 
Capitol, given the state of terrorism that we have seen in the 
last number of years, and attacks on the government. This is 
the people's House. It is extremely open. Clearly people can 
walk into the building any time they want to. We had Greenpeace 
just last year drive up and drop a load of coal on the front 
lawn, so to speak, and they weren't stopped by the barriers and 
our procedures at that point in time. Gratefully--
    Mr. Serrano. Greenpeace?
    Mr. Hantman. Gratefully it was only Greenpeace.
    Mr. Serrano. And they are a peaceful group.
    Mr. Hantman. So it is a comprehensive program which we will 
be presenting again at the Capitol Police Board meeting this 
afternoon, again in totality, to protect the entire perimeter 
of Capitol Square. There is a subset of that, some $3 million 
or so for protection and elimination of the jersey barriers 
around the Senate office buildings as part of that $20 million 
project. Again, that is in my mind a unique project.

                            ADA improvements

    Mr. Serrano. Before Mr. Hoyer had to leave for another 
commitment, he left a question. You mentioned in your prepared 
statement that over the last year some part of the $18 million 
is being used for ADA improvements. How would you assess the 
Capitol complex plan with the ADA? What priorities do you 
identify to accomplish full compliance?
    Mr. Hantman. In our budget we have some $500,000 right now 
at the Capitol to replace the wooden ramps both at the House 
side and the Senate side, the north and south sides of the 
Capitol, to deal with more permanent access for the ADA. They 
are unsightly, they are falling apart.
    Within the Capitol building itself, we are approaching 
several areas that need to be more ADA-compliant, for instance, 
the door, the south door on the House side. The north door on 
the Senate side is currently under construction. We should be 
starting fairly soon to do the southern door as well, to make 
it more accessible for ADA, there we have revolving doors, that 
are not ADA accessible at this point in time.
    There is kind of a double edge on that, as well. Not only 
are we talking about ADA accessibility, but we are talking 
about security and means of egress sensitivities here. We 
currently get 20 to 25,000 visitors a day coming through here, 
along with existing staff and people who come for meetings and 
all kinds of events. The means of egress, some of them are not 
compliant with door swing direction, with the door panic 
hardware, all of these things. So at the same time we address 
the ADA criteria, we need to address some of those issues as 
well.
    Clearly there are areas where we have multiple levels 
throughout the Capitol which are fairly awkward. We have ramps 
going up those levels at this point in time. We just, over the 
recess, put in a ramp in the Senate Chamber to match the ramp 
in the House Chamber, so that its accessibility would be full 
over there. We have much to do and we are making progress.

                            human resources

    Mr. Serrano. There was an article in Roll Call in September 
entitled ``The Architect's Office Still Fighting Abuses.'' It 
reported that before you took over, employees of the 
Architect's Office considered it one of the last bastions of 
favoritism and discrimination on the Hill. You were described 
as making some improvements, meeting with every employee, and 
bringing women into management.
    Could you just bring us up to date on what new information 
there is about employee morale, and what would a follow-up 
article say?
    Mr. Hantman. It might be helpful, Congressman, to ask 
Hector Suarez to talk a little bit about the Human Resources 
Department and the efforts we have made to make sure that we 
are no longer considered the last plantation. Hector?
    Mr. Suarez. On my arriving here last year, sir,basically my 
assessment was that the whole system in terms of human resources 
programs and systems was very antiquated. I have often described them 
as probably reflecting something that I was responsible for in the 
1960s, in terms of developing responsive programs and processes not 
only for employment but for job classification, for accountability and 
discipline processes, you name it. They all are in need of renovations, 
upgrades, however you want to put it, in terms of bringing them up to 
be reflective of what is a modern HR system.
    That is reflective of the work that we have in Human 
Resources, in terms of needing to do almost similar to what we 
are doing with the building. There are systems that really 
should have been revamped so that we are more responsive in 
terms of meeting wage issues and concerns as well as management 
concerns in delivering the processes, whether it be recruitment 
to bring someone on board as well as processing the retirement 
paperwork. All are areas that we prioritize in terms of 
addressing systematically and bringing them up to what would be 
reflective of a modern HR system.
    Mr. Hantman. We specifically also initiated a wide range of 
new training programs. Many of our managers, our supervisors 
were basically promoted out of the ranks with no managerial 
experience. Every one of our managers is going through a 
training program to talk about how they should appropriately 
deal with those who report to them, to be sensitive to those 
needs, to recognize that we don't need to beat somebody on the 
head to get a job done but you need to work with them, set 
realistic goals and monitor them and give feedback that is 
constructive.
    All of those issues are ongoing right now. We are in 
transition, Congressman, at this point in time, no doubt about 
that. We have not reached a panacea. We have had a big hole to 
begin to dig ourselves out of and we are working on several 
fronts to do that.
    Mr. Serrano. But, specifically, what are some of the 
problems in that hole that you had to dig yourself out of?
    Mr. Hantman. Clearly there had been favoritism in terms of 
promotions, in terms of people not really giving other folks a 
fair chance to apply for jobs, some of which were never posted. 
We had a situation where the organization was basically 
demoralized because there had been a two-year search process 
for the new architect, during which time Bill Ensign, the 
acting architect, had not been able to make any changes in 
policy.
    There is also an issue that we have many jurisdictions 
within this agency. Bob Miley here represents the House office 
buildings. Amita Poole represents the Capitol. We have a 
superintendent of the Senate office buildings, a superintendent 
of the Library buildings and grounds, of the Supreme Court, a 
superintendent of the power plant, superintendent of the 
grounds. All of these superintendents pretty much did their own 
thing. We are trying to standardize processes and procedures.
    Here we now have AFSCME Local 26 representing cleaning, 
custodial people, representing janitorial staff, laborers in 
the House office buildings, in the Senate office buildings, in 
the Capitol. They need to be treated the same way, have fair 
understandable job descriptions, job scopes of work. We need to 
be able to have people understand what their normal hours are. 
Hours were different on the House side than on the Senate side 
by half an hour. We need to standardize this and make it one 
agency, where people on the House side, if they want to apply 
to a position on the Senate side, can do so, a level 2 on the 
House side is a level 2 on the Senate side.
    All of these things need to be made more fair and equitable 
and Mr. Suarez has his hands full in doing that.
    Mr. Serrano. Thank you. Thank you, Mr. Chairman.
    Mr. Walsh. Thank you. Vic, do you want to proceed or do you 
want to go up and vote? We have got a couple of votes. Why 
don't you go ahead? When there is a couple of minutes left, we 
will go vote.

              appointment of the architect of the capitol

    Mr. Fazio. Good. Alan, let me just say it has been a year 
and a day, as you say in your statement. I have not really had 
a chance to talk with you much. I was, as you remember, 
involved in the selection process.
    I know this is kind of an easy one, but I would be 
interested in your thoughts in addition. If you had it to do 
over again, would you apply for this job?
    Mr. Serrano. Mr. Walsh makes budget decisions based on how 
you feel about us.
    Mr. Hantman. Congressman, absolutely. People ask me how I 
am doing and I say it is a magnificent challenge. There are 
stressful issues related to this job. I was just talking to 
Stuart last week as we were preparing our budget hearing over 
here and recognizing the fact that this is a very difficult 
decision-making time for all of us.
    I said, ``You know something? It is really worth all the 
effort, all of the time that we are investing in this, all of 
the research we are doing in what our agency wants to be, how 
it wants to go into the future, how we want to be fair to our 
employees.'' It is a magnificent challenge. I truly welcome the 
next 9 years.

                   oversight of the house and senate

    Mr. Fazio. I know you have touched on some things, I am 
sure, in part of your response, but what really was most 
unanticipated? What have you been most surprised by in the 
sense of what you discovered here when you showed up, put your 
pencils in the desk?
    Mr. Hantman. In all honesty, Congressman, I thought I would 
have problems with Democrats and Republicans. I have problems 
with the House and the Senate. There is a different approach to 
some things in terms of oversight, in terms of how the House 
and the Senate interface. I was just not aware of that--I am 
very politically naive, quite frankly. My goal over here is to 
be totally bicameral, to be fair to everybody, to make sure 
that the House and the Senate get equal treatment from 
everybody in my agency. I am digging myself out of the hole 
because I think both the Senate and the House don't believe 
that that is being done.
    It is interesting, as I mentioned to Chairman Walsh the 
other week, we had folks in from Australia who have a bicameral 
system, folks in from England say exactly the same thing, the 
House of Commons thinks the House of Lords is getting better 
treatment. It is really balancing that. But we did have the 
Irish minister in yesterday. We found out that the House of 
Commons over there clearly is over the Senate. So he said, ``We 
have no problem over there. We know who we have to deal with.''
    Mr. Walsh. No pretense at all.
    Mr. Hantman. No pretense at all.
    Mr. Fazio. We are continually working to try to bring that 
about here.
    Mr. Walsh. You can help us with that.
    Mr. Hantman. Okay.
    Mr. Fazio. So it was the conflict between the two 
institutions that both vie for your attention, vie for 
uniqueness of treatment, and in effect want to run their own 
part of your show. You might have discovered that in the 
Capitol Police as well.
    Mr. Hantman. It is interesting. As you know, I sit on the 
Capitol Police Board along with the Sergeant at Arms of the 
House and the Sergeant at Arms of the Senate. We have 
established very good working relationships.
    I have also found that the CAO, who is new on the job, and 
also the Secretary of the Senate, Gary Sisco, are very open to 
talking about how things have worked and how we can improve 
them, how we can eliminate overlapping responsibilities. We are 
in full discussion with these people about how to save taxpayer 
dollars and bring functions and procedures down to the point 
where we are doing as good a job as we can without saying ``It 
is my territory.''
    Mr. Fazio. We have been working on these problems for as 
long as I have been here, as long as Mr. Lombard has been here, 
but I don't think we will ever quite get rid of them because 
there is a certain amount of inertia on the part of not only 
the elected officials who have an interest and have a 
propensity to micromanage, but also the people they appoint to 
run these operations, who think it is their task to look out 
for the Senate or the House.
    You talk to members of the police force here, they will 
want to be assigned to one or the other for one reason or 
another because there is a different culture. It is an 
incredible, I guess I won't call it what I think it is, but it 
is a problem that goes back a long way and is not easily gotten 
rid of because Members come and go. Even Architects come and 
go. But these folks are here 30, 40 years. They are not about 
to change, because in fact they have got too much going the way 
it is, or perceive at least that they do. So good luck to you 
in this regard.
    Mr. Hantman. Perhaps, Mr. Congressman, because again I am 
somewhat politically naive, coming in here my philosophy has to 
be, as I said in response to Chairman Walsh's comment before, 
that if I have any kind of integrity, I am going to tell you 
what the issues are and we have to work it out together. I am 
going to tell you what the problems are, what I think should be 
done, and we will see where it comes out, even though I might 
get beaten about the head a bit in the process.

                        CAPITOL VISITORS CENTER

    Mr. Fazio. I don't want to talk about the security issue 
now because we are going to talk about it this afternoon, but I 
am always concerned about how we proceed on security, one, in 
light of the uniqueness of being a public building, among all 
the other things we are, and I think you are sensitive to that, 
I am sure, but also because we seem to have built our security 
plans around, at least in part, the visitors center.
    I would be interested in hearing more later on about what 
are common elements of a short-term security augmentation 
versus the ultimate that might relate to limiting public 
entrance into the building complex, that sort of thing.
    Mr. Hantman. The perimeter security system and the visitors 
center basically are stand-alone projects, but they are easily 
integrated if in fact we ever get funding for the visitors 
center. We can explain that this afternoon.
    Mr. Fazio. I see the visitors center and essentially the 
backlog that has grown over the years, you refer to a balloon 
payment, I think it is due, has been due, but how you get to 
pay it down is another question. These are separate issues. 
They need to be taken up separately.
    Mr. Walsh very adroitly dealt with the problem of the 
Botanic Garden by taking an opportunity to do it when it didn't 
become a bone in the throat of this committee, and its bill and 
the total cost so rigorously adhered to. I think to a great 
extent--and I can say this, having been here a while--we simply 
have always found the capital outlay portion of your budget one 
of the few variables we could work with. If you look at the 
totality of this bill, it is mostly people.
    Mr. Hantman. That is correct.
    [A question from Chairman Walsh and response follow:]

    Question. We will be reviewing the grounds security plan 
with the Capitol Police Board. But can you tell us how it 
relates to the Visitor's Center project?
    Response. The Capitol Square Perimeter Security Plan has 
been developed with the Capitol Visitor's Center (CVC) as an 
integral yet separately implementable part of the overall 
security improvement program. Of the schemes analyzed, the 
scheme approved by the Capitol Police Board provides the 
maximum security for the ``open'' environment of the Capitol 
Grounds while fully anticipating and integrating the future CVC 
into the infrastructure without wasting resources. This is 
accomplished by providing ``temporary'' security elements in 
the area of the future CVC construction. This is primarily 
focused around the East Capitol Street entrance to Capitol 
Square. All other areas of the Capitol Grounds covered by the 
Capitol Square Perimeter Security Plan will become permanent 
elements of the physical security systems. The key contribution 
to improved security the CVC provides is the remote screening 
and processing of the ever increasing volume of visitors to the 
U.S. Capitol.

                         CYCLICAL REINVESTMENT

    Mr. Fazio. You have a large component here, 63 percent or 
whatever, but you have the largest share of annual discretion 
in your capital outlay. Everybody else here has, oh, maybe some 
business equipment purchases or maybe a communications 
expenditure, but there isn't really any big issue that gets in 
the way of paying people the benefits and the things that they 
need to retain and attract good people.
    This is the one variable. There is no way we have ever been 
able to adhere to the big picture restrictions on what we could 
do, passed down by not only our leadership but by the 
perception of what the members can accommodate, other than to 
move your capital outlay, and mostly down. I really don't have 
an answer for it. I know exactly what the chairman is 
struggling with.
    The only thing I have been able to think of, and I don't 
know whether we could do it or not, would be to have full scale 
hearings in the Public Works subcommittees to try to move an 
authorization which again would require the House and Senate to 
agree on what its common concerns would be and then try to make 
a separate distinction, almost, working down the backlog here 
of deferred maintenance projects that need to be stepped up to 
that are going to be more than partially costly.
    Mr. Walsh. Vic, could I interrupt for a second? We have got 
45 seconds to vote.
    Mr. Fazio. We better go.
    Mr. Walsh. You can finish your thought, then we will come 
back.
    Mr. Fazio. What I would like to say is, at least your 
effort to come up with a rationale for cyclical reinvestment is 
good, and frankly it hasn't been done before. We need to talk 
some more about it when we get back, because it gives us a 
benchmark to work from which frankly we have never had, except, 
``Gosh, we need to do all this stuff,'' which isn't helpful to 
Mr. Lombard as he tries to sort out what needs to be done.
    [Recess.]
    Mr. Walsh. May we begin? As you were saying----
    Mr. Fazio. Just to conclude, I really think the only way we 
are going to, in effect, do what we tried to do at the Library 
with the arrearage problem is to make an outlay specifically 
for that purpose. Frankly we have not solved that problem, 
either, but at least we attempted to attack it as part of the 
overall budget.
    I don't think the committee, regardless of what party is in 
control, certainly in this House--maybe the Senate is a little 
different, in that the Members seem to delegate responsibility 
to a few people and look the other way, unlike the House which 
sees this as a measure of their frugality--unless we are able 
to somehow get a separate funding bill through and almost 
separate it from the base of this bill on a one-time, let's get 
it done but at the same time continue to do the cyclical 
reinvestment. Unless we take some approach like that, this 
problem will just keep moving without end, hopefully without 
any serious problem, we wouldn't want anyone getting egg on 
their face, like the dome falling. But it seems to me we are 
really up against the reality that this is not an area that 
this committee alone is going to be able to handle, even with a 
surplus in the sense that maybe we have gotten a little bit of 
running room. I don't know.
    Mr. Hantman. I respect that. That is one of the reasons, 
again, no matter how rational or irrational it was, I took the 
security project and said, this is a separate issue, this is 
nothing that is involved with our day-to-day reinvestment.
    Mr. Fazio. What is the total cost of that going to be?
    Mr. Hantman. $20 million.
    Mr. Fazio. Over what period?
    Mr. Hantman. Basically it is a 30-month design-construction 
period. Again, you have to book it in one year, which is part 
of the problem, so how do you phase that is the problem.

                        HUMAN RESOURCES PROBLEMS

    Mr. Fazio. We will talk about that later.
    The people problem which Mr. Serrano mentioned is something 
that probably has been overlooked for many years. You seem to 
have an attitude that you want to grapple with it, in fact know 
you have to. What kind of resources do you have to deal with 
the human resources problem that you have, discrimination, 
favoritism, whatever?
    Mr. Hantman. We have an executive committee that meets 
regularly to talk about all of the issues and the restructuring 
that we need to do. Clearly you have met Hector Suarez, who is 
the lead person.
    Mr. Fazio. Hector is new to your agency?
    Mr. Hantman. How many months is it?
    Mr. Suarez. Not quite a year yet.
    Mr. Hantman. I am an old guy on the block compared to 
Hector.
    Mr. Fazio. Compare, if you would, ostensibly what was in 
place to deal with these issues as compares to now.
    Mr. Hantman. The HR department was totally dysfunctional. 
The last director had left two years before. An assistant was 
in place who was not a happy camper. She left as well. Clearly 
because of the lack of leadership in the department, we lost 
some very good people, I understand there had been good people 
in the department, so we have been rebuilding. Hector has 
brought in several people through the recruitment process that 
can deal with issues relative to those that the Compliance 
Board is asking us todeal with in the Architect's Compliance 
Act and the Human Resources Act.
    Mr. Fazio. What is your background, Hector? What have you 
done in this field?
    Mr. Suarez. I have about 24 years experience in HR, sir, 
both in operations and policy. I have been a director of human 
resources for two offices. I have also been a director of HR 
policy at the national level.
    Mr. Fazio. Which agencies were those, sir?
    Mr. Suarez. EPA. Which was the last agency I worked with.
    Mr. Fazio. You have always been in the Federal structure?
    Mr. Suarez. Yes.
    Mr. Fazio. The people you have working for you, what are 
their backgrounds?
    Mr. Suarez. The backgrounds, of the staff that I inherited 
was that of a very traditional staff in terms of people that 
are specialists in staffing and the hiring of people, people 
that are specialists in position classification which is how we 
set pay, people in the training office, and people who deal 
with employee and labor relations, all traditionally set 
operations.
    What was missing, in terms of how we carried out our 
business, was compliance with changes in new laws and 
regulations and changes in HR methodology, in terms of how 
business should be done. We were, in staffing and recruiting, 
for instance, we were approaching it with methodologies that 
have changed over the years.
    The same thing goes with how we looked at and evaluated 
jobs in terms of job classification. We need to be more 
proactive in terms of explaining to an employee how the job is 
graded. The basis for finding out how a job was graded was 
somewhat secretive, and there should be nothing secretive about 
how a person's job and salary are set. We need to be taking the 
time to explain the process. That type of customer service 
mentality in terms of making sure that when we are proposing an 
action, or when an employee makes a request for information, 
that they clearly understand the hows and the whys.
    We have a lot of rules and regulations that we were experts 
in, but in order for us to be effective, the people that we 
serve, the employees, and the managers need to understand the 
processes and the procedures just as well as we understand them 
so that it makes sense, and does not appear to be covered by 
sense of secrecy.
    Mr. Fazio. My impression is there was a certain amount of 
patronage at one time at the agency and there was a good deal 
of nepotism, perhaps even more than patronage. If you knew the 
right person, you might get hired at the beginning of your 
working years and be there another 40, as long as that pecking 
order remained in place, in those little shops behind the 
doors. In some shops they were black people, in some shops they 
were white people, and rarely would there be any integration. 
Is that all accurate, what I have to say?
    Mr. Hantman. My understanding is yes.
    Mr. Fazio. I got that impression, not from this table but 
from just hanging around here 20 years and occasionally looking 
in those doors and talking to those people. How is that 
changing?
    Mr. Hantman. I think part of my information gathering, as I 
mentioned, there were three components to it. One of them was 
intraagency. I met one-on-one with every manager in the 
organization, probably about 40 different interviews. I also 
met in groups ranging from 12 to 200 people, every other member 
of the agency.
    And I brought along with me Art McIntye, who is our 
Inspector General, to deal with the issues of fraud, waste and 
abuse, and Kathy Gause, who is the head of our EEO policy, so 
we can talk about what is right, what is wrong, what complaints 
might have been bottled up. We invited people to give their 
feelings about what the agency was all about, where they think 
it can go, and I talked privately with employees where 
necessary. So to get a pulse of the agency and what people were 
all about, I spent a significant amount of time doing that.
    One of the reasons that we initiated as widespread a 
training program as we have is because clearly a lot of 
training in basic management techniques is necessary for a lot 
of folks in the organization, to recognize that we are dealing 
with human beings here, that we need to work with people, make 
them glad they are coming to work so we can get a full day's 
work out of them, that they are happy doing it and they see 
perhaps some opportunity for upward mobility as well.
    Mr. Fazio. How open are we to hiring beyond neighborhoods 
around Washington where people tended to come from?
    Mr. Suarez. All of our jobs----
    Mr. Fazio. We preceded car pools. More often pickup truck 
pools.
    Mr. Suarez. We had had a practice where jobs traditionally 
were filled within a given jurisdiction. One of the things that 
Mr. Hantman changed was deciding that we should advertise 
vacancies so that employees on the whole campus may be 
considered, so that employees in the Senate could apply and be 
considered for positions in the House.
    Mr. Fazio. Moves people around.
    Mr. Suarez. Absolutely.
    Mr. Fazio. What about at the entry level?
    Mr. Suarez. At entry level we are opening vacancies to all 
sources.
    Mr. Fazio. Do you have an outreach program----
    Mr. Suarez. Fledgling, sir. Not anywhere close to what we 
would like to have, but we are beginning to go in that 
direction. That is one way we see of addressing diversity which 
is one of our goals. This specifically is an issue that is 
addressed in our strategic planning process. We want to 
proactively take steps to make sure that we reach out more than 
we have in the past.

                             EMPLOYEE UNION

    Mr. Fazio. What percentage of the people are within AFSCME? 
What is the number?
    Mr. Hantman. We have roughly 2,000 people in the agency. 
Approximately 600 employees are represented by AFSCME.
    Mr. Fazio. They are concentrated in what bargaining unit?
    Mr. Hantman. Basically it is custodial and laborers.
    Mr. Fazio. Are any of the other elements considering or 
have they considered organizing?
    Mr. Hantman. Is Margaret here? Can you speak to that?
    Ms. Cox. Yes, I can address that.
    Mr. Hantman. Our labor counsel, Margaret Cox.
    Ms. Cox. There was an effort by AFSCME, Council 26, to 
attempt to organize nearly all the trade craft employees, all 
the skilled tradespeople, as well as the Senate restaurant 
employees. They abandoned that effort in favor of organizing 
only a unit of laborers and custodians. It doesn't mean they 
won't resume that effort but right now I am not aware of any 
petition that is pending.
    Mr. Fazio. But the Senate restaurant people are now gone, 
right? Don't we have a contractual relationship?
    Ms. Cox. No, they are our employees.
    Mr. Hantman. We have a buyout program right now. Lynne 
Theiss who is in charge of the restaurants is here. We have 191 
people. We just had a buyout program in which 23 people took 
advantage of the early out buyout programs. The Senate 
Restaurants got whatever multiplier of their salary. They are 
still in-house but they are now in the black as opposed to in 
the red. That is just this year.
    Mr. Fazio. Were those people replaced or was it a decision 
they were overstaffed?
    Mr. Hantman. They were overstaffed at that point.
    Mr. Fazio. But there has never been a move to contract the 
Senate dining room. It continues to be subsidized?
    Ms. Theiss. That is correct.
    Mr. Fazio. Which is one of the differences between the 
House and the Senate, of the kind that we talk about here.
    Ms. Theiss. That is correct.
    Mr. Fazio. The skilled trades, are they more logically 
represented by, say, electricians unions or laborers unions or 
some other building trade union, carpenters?
    Ms. Cox. Many of them are members of those types of labor 
organizations. However, in terms of representing the public 
sector employees which our employees would be, more likely 
AFSCME or some other public sector union will organize them. So 
in their own professional trade unions such as electricians, 
plumbers and pipefitters, our employees may very well be 
privately members of those unions, but in terms of collectively 
bargaining with this agency, most likely it will be a Federal 
sector union that will attempt to organize them, if any at all.
    Mr. Hantman. We also have in our construction management 
division employees that are hired directly from union halls.
    Mr. Fazio. You have some people who are permanently on 
building trades, and others come and go depending on the work 
you have to do?
    Mr. Hantman. That is correct.
    Mr. Fazio. When you do the contracting. When they have a 
private contractor, it could be union or nonunion. That is not 
an issue as far as you are concerned?
    Mr. Hantman. Right.
    Mr. Fazio. Mr. Chairman, I don't want to take any more 
time. I am looking forward to this hearing this afternoon, I 
hope I can be there, on the security issue. I think really this 
is a conversation we have to have among ourselves about how to 
deal with this problem. We understand. It is just very, very 
intractable.
    Mr. Walsh. I appreciate that. I also appreciate the 
questions that my two colleagues made regarding human resources 
in your office. I would associate myself with those questions. 
I think your responses were constructive. Obviously you are 
only as good as the people that you have. If they all feel they 
have an opportunity to succeed and grow and move ahead, it is 
going to make it a better place to work and a better work 
product ultimately. Thank you for asking those questions.
    We have another hearing at 1 o'clock, which gives us an 
hour and 10 minutes. I would like to ask just a couple of more 
questions if I may, and I am not sure, I will try to keep my 
questions and hopefully your answers to about 5 minutes. And 
Mr. Serrano and Mr. Fazio, if they would like to do the same, 
then we will just submit the rest of the questions for the 
record.

                          CAPITOL DOME PROJECT

    The dome project, this is obviously hugely symbolic of 
everything that we do here, so it is a very important case. The 
questions are basically, there were a couple of studies done, 
commissioned by the prior Architect. They submitted what they 
estimated the costs would be for this project. They were in the 
neighborhood of $3 million. We provided $1.5 million last year 
for a request that estimated a total cost of $3 million. As we 
were preparing for markup, we were notified that project costs 
could go up to $5 or $6 million. Now we are looking at an 
estimate of $26.5 million. That is before the structural 
analysis of the dome ironworks are complete.
    First of all, are the people who gave us the initial 
project costs that did the studies, are they doing these 
follow-up studies?
    Mr. Hantman. No, they are not. We have outside estimating 
firms looking at that, retained specifically under the 
architectural firm.
    Mr. Walsh. So the people who gave us an estimate of $2 to 
$3 million are no longer part of this project?
    Mr. Hantman. The design architects are still part of the 
project. The issue of this marker, if you will, there is no 
doubt about it, the magnitude of the project has increased, the 
complexity of the project has increased. But that $3 million 
was just totally off base.
    Mr. Walsh. So the people who gave us that totally off-base 
estimate are no longer part of this project?
    Mr. Hantman. They are no longer part of the estimating part 
of the project.
    Mr. Walsh. Are they in any way a part of this project?
    Mr. Hantman. They are doing inspection of the plates and 
recommendations in terms of how we should be treating it.
    Mr. Walsh. How can we have any confidence in their work?
    Mr. Hantman. We don't have any confidence in their cost 
estimating ability, there is no doubt about that. In terms of 
their capability to recommend functions and features ofwhat 
needs to be done on the project, how the project needs to progress, 
they have excellent credentials.
    Where the $3 million came from and what their rationale 
was, I can't speak for it, but the reality is when the dome was 
last painted in 1959, 1960, it was a $1.4 million project. If 
we escalated just that scope of work to today, we would be over 
$10 million. So the $3 million had no basis in reality even in 
terms of what they did. That is without the environmental 
protection concerns that we need because we have a lead-based 
paint that we have to remove in accordance with EPA criteria. 
So they totally missed the boat on that one.
    Mr. Walsh. I guess I would be concerned that even though 
they may not be the people that are making the cost 
projections, the cost projections will be a function of the 
analysis that they provide, will it not?
    Mr. Hantman. What we have done is we have brought in 
another firm called Thornton Thomasetti, internationally known 
structural engineers and also experts in waterproofing, things 
of that nature, to work directly with them and to give us their 
second opinion. We are going through a belt-and-suspenders 
approach. These are the people who are doing the structural 
analysis of the dome as well.
    The first firm, Hoffman Associates, had been involved in 
this project for 7 or 8 years, since the inception of it. They 
have a database of background information that is valuable to 
us. Rather than re-creating the wheel, what we are doing is 
keeping their database, having them follow up on that 
information and taking out of their hands basically the 
estimating and we are double-checking and giving it to other 
people as well.
    I share your concerns. They were significantly reamed out 
for even beginning to suggest a project number like this 
without adequate facts. Clearly they had not opened up the 
railings at the upper level of the tholos that we talked about. 
We have samples of the rust and the things like that that we 
found up there which you may not need to see at this point. 
That was just an off the top of the head type of thing. It was 
just a number in the dark and it had no relevance.
    Clearly, while we are talking about projects, we often 
need, before you are authorized to do studies, we need to come 
up with some kind of number because there is a budget process 
going on. We have such numbers in the budget right now. For 
instance, we are doing a study on the Senate Chamber which was 
authorized through funds last year. We are about to recommend 
to the Speaker that we do a similar study in the House Chamber.
    Sitting there at the State of the Union and looking at 
occupancy and how things are, clearly we have electrical, 
mechanical, structural, we have security issues all to look at. 
We need to put together a task force from the Speaker's Office, 
from the Sergeant at Arms Office, from the Clerk, from 
everybody impacted, sit down and bring in outside experts and 
take a look at what needs to be done to upgrade that. If the 
Speaker authorizes that, we would go ahead.
    We have in our budget right now a request for $300,000 in 
fiscal 1999 to do just that. But because we have a 5-year 
budget, we have in a subsequent year a number of $15 million. 
That is the first time we are hearing a number for the House 
Chamber. Is that number right? What basis was that number made 
on? The last time the House Chamber was done was in 1949, 1950, 
1951, 1952. It was totally stripped out. The Walter scheme was 
totally, basically destroyed, and we have a 1950 solution in 
our Chamber right now. The number that was spent at that point 
in time was $4.2 million for the House and the Senate.
    Mr. Pregnall. They were combined.
    Mr. Walsh. That is interesting.
    Mr. Hantman. Something like that. You escalate those 
numbers to today, and you come up to roughly $28.5 million for 
the two Chambers, which is why we have in our budget $15 
million for the Senate Chamber, $15 million for the House, 
based on what was done last time. That is the only benchmark we 
have, but we had to put a number in our budget. The $3 million 
number just had no basis in reality. But we need to have these 
markers, if you will, of something coming down the pike.
    Could the House Chamber project be $10 million? Yes. Could 
it be $20 million? If we phase it over multiple years and we 
have real security issues we have to factor in, and we have to 
go back to the central plant, it could be. We have $15 million 
in there as a marker, if you will. In my mind the only thing I 
can say for that $3 million, it was a marker, but it was 
totally off-base because this project could be well in excess 
of $30 million.
    Mr. Walsh. There are a lot of questions we will submit, due 
to the shortness of time, I will have to do that.
    [Questions from Chairman Walsh and responses follow:]

                          solid waste disposal
    For Capitol grounds, $5.3 million is requested for the operating 
budget and $21.3 million for the capitol budget
    Question: Why is the fee for solid waste disposal going up from 
$348,000 (1997) to an estimated $600,000?
    Response. There is no requested increase in this account for fiscal 
year 1999. The allotment base has been at $600,000 since fiscal year 
1995. The annual costs in this time period have reached over $500,000 
per year. Fiscal year 1997 actual payments totaled $374,461. Because 
final invoices had not been received as of September 30, 1997, the 
actual cost increased slightly over the $348,000 reflected as fiscal 
year 1997 obligations in the budget. The balance was returned to the 
U.S. Treasury.
    The decrease in annual costs can be attributed to two factors. 
First, there has been an unusually low number of construction projects 
underway that would cause a decrease in the amount of refuse for 
disposal. However, we have received funding for many new projects in 
fiscal year 1998. Once the projects are underway it is expected that 
the amount of refuse will again increase. The second factor that has 
affected this account is the success of the recycling program in the 
Capitol Complex. This program has reduced the amount of trash that was 
formerly removed under this contract.
    If it appears that the costs will continue at a lower rate than the 
allotment when the new projects are underway, we will propose a 
decrease to the base allotment of this account.
                      longworth building elevators
    Question. What is the status of the Longworth elevator project?
    Response. The contract was awarded to Grunley Construction Company 
on May 16, 1996, in the amount of $6,369,000. As awarded, the contract 
completion date was July 1998, with an interim completion date of May 
1997, when the seating area of the cafeteria was to be reopened. This 
project will construct four (4) elevators in the west tower and two (2) 
in the east tower bringing the total count of elevators to fifteen.
    Work on site started in May 1996, with the closing of the cafeteria 
so that the contractor could start his excavation work for the 
foundations for the new elevator towers. Currently, the work of the 
contract is approximately seventy percent (70%) complete. On September 
4, 1997, the Contractor completed the first phase of the project by 
turning over the construction side of the Longworth's cafeteria for use 
by the building's occupants and the public. The erection of the 
structural steel framing and the pouring of the concrete floor slabs 
for the east and west towers has been completed and the contractor is 
proceeding with installation of the exterior insulated finish system 
(EIFS). The work in the building's sub-basement is well underway with 
the electrical and mechanical systems being roughed in.
    The current scheduled completion date of October 1998 is three 
months later than the original contract completion date. A non-
compensable time extension was issued to the contractor. 
Variousunforseen conditions encountered during excavation and 
demolition, such as old foundations in the areas to be excavated and 
asbestos covered piping in walls to be demolished, along with a very 
constricted job-site precluded the contractor from making the progress 
that they originally anticipated.
    Question. When will they be ready for use? Will they be fully 
automatic when they are?
    Response. Based on the latest update of the contractor's schedule, 
the elevators should be available for use in October 1998. They will be 
fully automatic, with the capability to be run by an operator. One (1) 
elevator in each bank will be available for Member's Only service. Like 
the recently renovated elevators in the building, the new elevators 
will have a ``state of the art'' controller. These new elevators will 
have an audio capability, similar to the elevators in the Dirksen 
Senate Office Building. This capability will allow for the programming 
of audio messages to be played at specific instances. For example, a 
message could be developed to advise the public that the car had gone 
into Member's Only service, that the original car calls will be 
canceled and the riders should exit the elevator at the next stop.
                           east plant chiller
    Question. For the power plant, you are requesting an additional $4 
million to continue the East Plant chiller project. We did provide 
design funds last year. But we do not want to get into another deal 
where we start funding a project while you have not completed the 
design and construction documents. This is a trend we want to stop. 
When will the design be completed and when will the necessary 
engineering be ready for firm cost estimates?
    Response. The design of the replacement of the East Refrigeration 
Plant has been underway for more than a year refining the schematic 
design options previously identified by our consultants. We have had a 
continuous dialog with the key American equipment manufacturers in an 
effort to prepare the bid documents in a manner consistent with the 
current equipment and control technologies. We fully intend to have the 
completed design and construction documents prepared with the first 
phase of a three phase replacement program ready for bid in the first 
quarter of FY1999 and will continue in an organized systematic manner 
through FY2001 until complete.
                         cogeneration facility
    Question. We also see funding for a cogeneration facility. Explain 
why that is needed?
    Response. Funding is requested to support the development of a 
cogeneration facility. Based on other similar projects developed under 
similar criteria, development costs range from 5-10% of the total 
development costs. With a total value of this facility estimated at 
$100 million, the funding requested for FY1999 represent the first 
installment of these anticipated development costs. The developmental 
funds will be used to pay for the engineering, architectural, 
financial, and legal consultants required to fully represent the 
Governments interests during the development, construction and 
commissioning phases of this project. A report is currently under 
preparation that will fully define this process, provide the 
anticipated schedule and estimated costs for each phase of the project 
development based on the Government/private partnership model 
previously presented to the Committee.
    Question: How would a private firm want to get involved in this 
project?
    Response. With the deregulation of the electrical industry and the 
changes imposed by the changing market place, there has developed a 
strong private sector industry that specializes in the design, 
construction and operation of this type of facility. The staff of the 
AOC has had discussion with various private firms focused in this 
business sector as well as representatives of the International 
District Energy Associations and consultants working in this field that 
have confirmed the strong viability of the concept. The process of 
development would be similar to that used to develop the Thurgood 
Marshall Federal Judiciary Building. A Request for Proposals (RFP) 
would be developed, technical and financial proposals solicited and 
evaluated. Upon completion of this process, a recommendation will be 
made by an independent review board of experts from the private sector 
and other organizations with relevant experience. This recommendation 
will be forwarded to the Committees of jurisdiction for authorization 
and approval prior to entering into a contractual relationship with the 
private sector ``partner''.
    Question: Shouldn't we wait until we decide such a capacity is 
needed and until we have a good idea of private sector interest?
    Response. It is our considered judgement, based on the 
recommendation of the Blue Ribbon Panel assembled to review the 
operations of the Capitol Power Plant and other specialists consulted, 
that the development process for the cogeneration facility should begin 
as soon as possible. Recent conversations with industry representatives 
have indicated that NOX emission levels could be reduced 
from the current level of 0.4 to 0.15 as early as 2003. At the 0.15 
level, coal could no longer be used as a fuel source without extensive 
modifications to the plant and its operations. Based on projected load 
requirements, security issues related to backup power, pending 
environmental regulatory changes, and the opportunities that the 
deregulation of the electrical industry present, the timing could not 
be better to begin this process. It is anticipated that the RFP, 
proposals in response to the RFP, both the technical and economic 
evaluation of the selected designer/developer teams and finally the 
submission to and review and approval of the Congressional committees 
of jurisdiction, will take between 18-24 months. All this must be 
completed prior to beginning construction which could last as long as 
36 months. Therefore, the facility would not be available until 2004 at 
the earliest.
                           culpeper facility
    Question: The budget requests $16.1 million for Library buildings 
and grounds. Have you completed your estimate of the cost of renovating 
the Culpeper facility for the Library's audio-visual center?
    Last year, the Library indicated that this would cost in the 
neighborhood of $2-$3 million. However, we had heard that AOC estimates 
were as much as 10 times that amount. Can you shed any light on that?
    Response. The AOC has not prepared an estimate related to Culpeper. 
The David and Lucile Packard Foundation is committing $10 million to 
the project, $4.5 million of which will be available for due diligence 
analysis, closing costs, master planning and Phase I renovation. The 
master plan will produce a cost estimate around the end of April, 1998. 
The $4.5 million is not the expected total cost of the project. Until 
this estimate is prepared, the Library relies on their Abacus report 
for total cost data.
                       off-site storage facility
    Question. What is the status of the off-site storage construction 
at Fort Meade? When will it be ready for occupancy?
    Response. Drawings are nearing completion. Bidding is expected to 
start in April. Occupancy is slated for the end of summer 1999. The 
current drawings reflect a significant re-engineering effort to bring 
costs in line.
    Question. We want to watch the cost of this project carefully. 
Since there will be additional modules to be built, this one will set 
the model for future projects. This building is supposed to be 
virtually identical to the storage towers constructed at Harvard and 
the University of Texas. Alan, please look into what those facilities 
cost to build. They were constructed at reasonable cost and both 
institutions were very helpful in providing information to us on their 
projects.
    It may be tempting to goldplate these projects, but that will just 
drive up the cost. Please tell your staff and contractors to avoid 
that.
    (For the record, provide comparative cost data for the LOC facility 
and for the Harvard and Texas facilities.)
    Response. The Texas facility is quite different from the Harvard 
model. Our intention was to design a facility similar to Harvard's 
recognizing that Harvard made, in their estimation, certain errors in 
judgment. An attempt was made to reflect Harvard's new decision at the 
schematic design phase of our project. At that time, we included fire 
protection systems and a larger processing area, both at Harvard's 
recommendation.
    The Harvard design holds 2.1 million volumes, which is the 
anticipated capacity of the current LOC design. The only basic 
difference between the facilities is the temperature/humidity 
requirements of the LOC vs Harvard. The LOC made a decision early on to 
store their collections at 50/35% RH which is significantly more 
difficult to obtain. The Harvard system for book storage (temp/
humidity) is currently under review. They are considering using LOC 
criteria for their next book storage module. Their 4,000 sq. ft. film 
storage module operates at the LOC conditions. Those conditions have 
contributed to the cost of our project to the degree that the AOC has 
had to create cost savings to keep the budget in-line. Again, this is 
the only significant difference between Harvard and LOC design 
requirements. The last Harvard book module cost $270.00/sq. ft. in 1996 
dollars. This module did not include a processing/office area. 
Additionally, the Harvard site had already been developed for previous 
modules: site utilities, storm water management, paving, etc., were not 
an issue with the 1996 module. Obviously, our cost per sq. ft. will be 
higher due to these essential differences.

    Mr. Walsh. My experience in City Council before I came here 
is, any time we did a renovation project of a school or an 
older building, you can almost always escalate the costs--once 
you got in and you opened things up, you found problems--by 50 
percent. So conceivably this $26 million project could be a $40 
million project.
    Mr. Hantman. It is always dangerous to put a number out 
there for anything, because when you open up the patient is the 
only time you know you need the repairs. We opened up the 
tholos level, the railing up at the upper level, and if you 
want to spend the time, we could go through a full discussion 
of that.
    There is a railing around the base of the dome also that 
was worked on in 1959 and 1960. That was 40 years ago. That 
might need total replacement, too, and that appears nowhere. We 
haven't even done a test case of what exists around there at 
this point in time. In fact, I am asking my people to come up 
with a recommendation for a second string of tests so we can 
better understand the magnitude of this moving target project.
    Mr. Serrano. It is on the outside?
    Mr. Hantman. Some work was done on that, Congressman, in 
1959 and 1960. That was 40 years ago. When we opened it up at 
the tholos level, if you can point to the railing up at the 
top, that is where the dome tours basically take people.
    We took apart one of those railings. We have pieces here, 
Mr. Congressman, showing the rust. We have a can full of rust 
we found, and we just opened up the top of it.
    Mr. Serrano. That is a piece of the dome, so to speak?
    Mr. Hantman. That is a piece of the railing at the dome. We 
have bags of bolts that have rusted right out and they were not 
holding anything in place.
    Mr. Serrano. This is rust?
    Mr. Hantman. It is rust.
    Mr. Serrano. Looks like good coffee to me.
    Mr. Hantman. There are bolts over there that were holding 
nothing on because the clamps were no longer on the other end 
of the bolts.
    Mr. Fazio. This is why I refuse to go up there. It is not 
that I don't have the energy anymore.
    Mr. Hantman. Chairman Walsh's comment is a good one. We do 
not know the scope of the project yet, which is why it is 
dangerous to even talk $26.5 million. I am sure it could go 
over $30 million. Could it hit $40 million? Maybe. I don't 
know. I don't know the scope, which is why we need to do the 
exploratory first phase, to remove the paint in the inner 
section there between the inner dome and the outer dome. That 
will enable us to take a look at one side of the plates, before 
we put up scaffolding and clean the outside, to see if there 
are more cracks in the plates and cracks in the structure.
    Mr. Serrano. That dome was originally brought over in 
pieces, right?
    Mr. Hantman. It was actually fabricated in different 
places. I think Rochester, New York, and Baltimore, Maryland, 
were two locations. Several different places we found these, 
which is another problem because the composition of the cast 
iron is different for each area, so when you start doing 
repairs----
    Mr. Walsh. Typical congressional method.
    Mr. Hantman. It is a quagmire, and it is difficult to come 
to you and say, we need money to study this and we don't know 
where the upside is yet, but that is the reality.
    Mr. Fazio. We had a similar problem on the front of the 
Capitol. We weren't sure what the restoration would amount to 
until we got in there, and how much were we off in the 
estimate.
    Mr. Lombard. It was an estimate of $73 million for the 
extension, and the rehabilitation, I think the appropriation 
was $49 million, and the cost was maybe $25 million, somewhere 
in there.
    Mr. Fazio. It was cheaper than we originally estimated on 
the premise that we really wanted, some of us, to expand it. 
But the bottom line is, you didn't know until you got in there, 
so Mr. White opted for a higher number so as not to be blamed 
for low-balling.
    Mr. Hantman. We are looking in the range of $16 million 
just to do the contained removal of lead-based paints inside 
and outside the dome and repaint the dome. That is without any 
of the metal repairs or any possible structural addition.
    Mr. Fazio. It makes no sense to do that unless you do all 
of it.

                           shower facilities

    Mr. Walsh. Let's see. Okay, just a couple other items. 
These are just some questions to get into the record before we 
break off. Last year we asked for a study of shower facilities 
available for use by the staff, House staff. That was prompted 
by an interest raised by Congressman Blumenauer. What is the 
status?
    Mr. Miley. Mr. Chairman, we have conducted a survey of the 
facilities that we presently have in the House complex, and, at 
the present time, we have two male and two female showers at 
the Ford Building, and we have two newly renovated male and two 
newly renovated female showers in the O'Neill Building, in 
addition to a facility at the Capitol, where we have two male 
facilities and one female facility.
    The only building we are really lacking adequate facilities 
in is the Rayburn Building where we have one unisex shower 
located in the lower G2 southwest corner of the garage. We feel 
that we can add two new shower facilities, two showers for the 
women and two for the men, in the subbasement of the Rayburn 
Building on the C Street side by taking two existing restrooms, 
male and female restrooms, close to that entrance, expand those 
and add the showers.
    We have prepared some conceptual drawings. It will involve 
encroaching on somebody else's space, so we are in the process 
of developing a formal drawing to transmit to the House Office 
Building Commission for their approval. Once that is done, we 
feel it is probably something that can be accomplished with in-
house personnel.

                            waste recycling

    Mr. Walsh. All right. Thank you, Bob.
    Lastly, concerns about the recycling program were raised. 
We had some conflicting statistics concerning the program and 
reports that the priority was flagging. Can you give us an 
update on the recycling program?
    Mr. Miley. Yes, sir. Over the past 9 months, we have been 
very actively promoting the participation in the recycling 
program by soliciting every Member's office, and as of now we 
have been in contact with every Member's office, provided them 
with information on the program, and provided adequate 
containers for participation in the program.
    Mr. Walsh. Proper labeling on the containers and so forth.
    Mr. Miley. Yes, we have provided proper labeling.
    As of August, we were able to bring on board a recycling 
coordinator, Ms. Pat Dollar, who is an exceptionally well 
qualified individual and has a lot of experience in recycling. 
She has been able to make some----
    Mr. Walsh. Let me cut to the chase, because we are running 
out of time.
    Mr. Miley. We are on the road to recovery. As of the first 
quarter of this fiscal year, we will be receiving credit from 
the recycling contractor, monies will go to the Government for 
recycling, which is the first time in a couple years that has 
happened.
    Mr. Hantman. 80 percent activity.
    Mr. Miley. As far as participation, over 80 percent of the 
offices at this time are participating. We have a pilot right 
now in two or three offices. We intend to make some 
recommendations to this committee and to the House Oversight 
Committee for permanent changes to the program, making it more 
user friendly.
    Mr. Walsh. Thank you very much.
    [Questions from Chairman Walsh and responses follow:]

    Question. You will remember the concerns raised last year 
about the recycling program. We had some conflicting statistics 
concerning this program and some reports that the priority was 
flagging. We particularly want to know the degree of 
participation and how we stack up against other agencies and 
organizations. Can you give us an update on the recycling 
program?
    Response. During FY1997, 2,226 tons of paper were recycled, 
thus diverting it from landfills. At an estimated rate of $77 
per ton, we avoided $171,402 in landfill costs. Because this 
recycled paper was contaminated beyond allowable limits, the 
Government did not receive any compensation for the material.
    In an effort to generate interest in the program and 
improve upon the quality of the program, the following actions 
have been taken:
    1. Every Member's office has been contacted and been 
provided with information brochures about the program, 
necessary containers supplied to the participating offices and 
appropriate labels applied to containers. In addition to 
Members' offices, most of the Committees and other support 
staff offices have also been contacted.
    2. In August 1997, a recycling coordinator was hired who 
brings to the job many years of experience in this field and a 
high degree of enthusiasm in improving the Office Waste 
Recycling Program in the House Office Buildings.
    3. Custodial workers and laborers are currently being 
instructed in proper recycling methods.
    4. The recycling coordinator is closely monitoring the 
materials being shipped out for recycling and training 
supervisors in proper documentation, to ensure we are given 
proper credit for materials recycled.
    5. As a result of contract changes, minor adjustments in 
the collection methods for newsprint, high grade paper and 
corrugated containers have been made, allowing the Government 
to receive a better compensation rate for the materials.
    As a result of the above actions, we estimate that during 
the first four months of this fiscal year (FY1998), 576 tons of 
paper have been recovered for recycling, resulting in the 
Government receiving approximately $10,500 in compensation, in 
addition to the landfill cost avoidance.
    At the present time, approximately 80% of the offices are 
participating in the program. Per capita recyclables generated 
compared with four Executive Branch agencies are as follows:

----------------------------------------------------------------------------------------------------------------
                                                                         Pounds per Year Generated              
                  Agency                     Est. Building Occupancy            (Per person)          Total Lbs.
----------------------------------------------------------------------------------------------------------------
HOB......................................  8000 persons...............  556.6 Lbs..................    4,452,000
HUD......................................  4000 persons...............  185.5 Lbs..................      746,000
USDA.....................................  7000 persons...............  145.7 Lbs..................    1,020,000
DOE......................................  6000 persons...............  125.6 Lbs..................      754,000
EPA......................................  3500 persons...............  227.4 Lbs..................      796,000
----------------------------------------------------------------------------------------------------------------

    At the present time, we are piloting some minor changes to 
the program which we feel will make recycling more ``user 
friendly,'' Upon completion of the pilot in the next few weeks, 
we will be submitting some recommended changes to the program 
to this committee as well as the House Oversight Committee. 
These anticipated changes will not require any budget 
increases.
    Question. Has this program been sufficiently staffed? Are 
we doing everything possible to make the House recycling 
program a success?
    Response. At the present time, we are recruiting for an 
additional recycling coordinator to assist with the planning, 
coordination, promotion, monitoring, survey, analysis and 
implementation of the program. The task of fully implementing 
the Office Waste Recycling Program and improving upon the 
program requires a great deal of program development, training 
of Congressional Staff, planning, analysis, and reporting 
capabilities, in addition to continuous hands-on application of 
the above skills. There exists both an analytical component as 
well as a marketing aspect to the recycling program which 
requires personnel to be capable of handling the more mundane 
aspects of the job, while also being able to provide detailed 
analysis and evaluation for long term strategic planning of the 
program. The additional recycling coordinator will fulfill the 
remaining needs of the program and help to make the program 
even more successful.

                             reprogrammings

    Question. For the record, insert all reprogramming actions 
or other documents that required Committee approval.
    Response. The following information is provided for the 
record.

[Pages 511 - 539--The official Committee record contains additional material here.]


    Mr. Walsh. Do you either of you gentlemen have a question 
to finish up with?
    All right. Thank you very much. And I am sure we will all 
have questions to submit and the dialogue will continue. We 
have a huge, huge challenge here for this budget.
    Mr. Hantman. Thank you.
                                       Wednesday, February 4, 1998.

                     U.S. GENERAL ACCOUNTING OFFICE

                               WITNESSES

JAMES F. HINCHMAN, ACTING COMPTROLLER GENERAL OF THE UNITED STATES
BRIAN P. CROWLEY, ASSISTANT COMPTROLLER GENERAL FOR PLANNING AND 
    REPORTING
JOAN M. DODARO, ASSISTANT COMPTROLLER GENERAL FOR OPERATIONS
RICHARD L. BROWN, CONTROLLER

    Mr. Walsh. We are ready to begin. We will begin with the 
General Accounting Office budget. The budget request is $369.7 
million, and 3,325 full-time equivalent positions. The funding 
includes $2 million that will be derived from offsetting 
collections.
    We have the acting Comptroller General, James F. Hinchman--
welcome--and several members of his staff are with us also 
today. We will give Mr. Hinchman a chance to introduce them in 
a second. Since the expiration of Chuck Bowsher's 15-year term 
in 1996, Mr. Hinchman has acted in that capacity. Jim is the 
principal Assistant Comptroller General and former General 
Counsel of GAO. As such, he has appeared before this committee 
on numerous occasions.
    And we welcome you here today. Before you begin, please 
feel free to introduce your staff. We have your prepared 
statement and you can proceed and summarize.
    Mr. Hinchman. Thank you, Mr. Chairman.
    First, let me introduce Joan Dodaro on my immediate right. 
She is the Assistant Comptroller General for Operations and the 
Chief Operating Officer; and beyond her is Dick Brown, our 
Controller, who, I think, is well known to this committee. Also 
here today is Brian Crowley, our Assistant Comptroller General 
for Planning and Reporting and the third member of the senior 
management team of our agency.
    As you said, I have a prepared statement which I request be 
put in the record.
    Mr. Walsh. Without objection.
    Mr. Hinchman. I would like to summarize it very briefly and 
make only two points.
    First, we are accountable to this committee for our use of 
the resources you give us, and I want to say a word about our 
spending plans for this year. We now have in place a spending 
plan that reflects the plan we described to you a year ago. 
Most importantly, we have instituted a new hiring program, for 
the first time in 5 years, that will allow us to begin 
replacing staff when they leave, as well as fill in the gaps in 
our skills and resources that have resulted from our downsizing 
and hiring freeze of the last few years.
    We have launched a major effort to upgrade our information 
technology infrastructure. That upgrade will allow us to bring 
the agency into compliance with requirements for the year 2000 
and, at the same time, respond to growing demands for increased 
speed and capacity in our system. I think that those two steps, 
along with the other things we are doing, will take us a long 
way toward the goal we described to you a year ago, namely, 
stabilizing the agency and normalizing its operations. I think 
the results of those efforts are apparent in our performance.
    Our performance report, as it is set out in our annual 
report that was just released, shows our products total 1,300 
in 1997, which is up slightly from the previous year. We 
testified 182 times before the Congress, which is up one from 
the preceding year. We have about $20 billion in identifiable 
benefits to the government arising from our work; a significant 
increase over the prior year, and our processes are looking 
better, too.
    The average time to do a job and the average cost of a job 
went down. Our timeliness in responding to congressional 
requests is up significantly. Overall, my report to you about 
the status of the agency is a positive one.
    We are stabilizing the agency, normalizing its operations, 
and I think we are continuing to meet our responsibilities to 
the Congress. That is the first point I want to make.

                    fiscal year 1999 budget request

    The second is a brief word about our fiscal year 1999 
request. Essentially, this request proposes that we continue on 
this path to stabilize the agency and achieve a staffing level 
of 3,450. To do that, we are seeking a 6.5 percent increase in 
our appropriation. That increase goes for only three things. 
The largest part of it goes for our mandatory and price level 
increases and for staff. There is also about $1.4 million to 
pay a portion of the information technology modernization cost 
that will be dealing with the year 2000 problem. And the third 
part is to increase our staff by about another hundred in 
pursuit of a staff level of about 3,450. We know that resources 
are limited. We have worked very hard to hold down our costs 
and to improve our efficiency and productivity.
    The request we made for this year is, I think, a 
responsible one and reflects the resources that we need if we 
are going to continue to improve the quality and level of our 
service to the Congress and meet our responsibilities as an arm 
of this institution.
    Mr. Chairman, those are the two points I really needed to 
make, and we would, of course, be happy to answer any questions 
you have about this request.
    [The information follows:]

[Pages 543 - 548--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you. And we do note that even with a lower 
FTE level of the past 5 years, your key performance measures 
are all significantly up. Financial benefits are up, product 
output is up, timeliness is improved; job durations are down, 
job cost is down. That is one trend, obviously.
    The other trend, which is of a little more concern, is your 
budget, 369.7 million is up by 28 million. This comes after 25 
percent downsizing in previous recent years. Last year we 
increased your budget by 8.5 million. This is a $28 million 
increase, which would give you almost a $37 million increase, 
$36.7 million increase, in 2 years. That is up 11 percent. So 
where we have 25 percent downsize, we are back up 11 percent 
after this budget; so it seems like downsizing is a thing of 
the past.
    Would you care to comment on that?
    Mr. Hinchman. We have been proposing for several years that 
we stabilize the agency at 3,450, which represents, about a 
one-third decline in the size of our staff, from about the 
5,300 level that we were at several years ago. Much of the 
funding increases we received over these 2 years have been 
absorbed by mandatory cost increases.
    For example, in this year's request, about $12.6 million of 
the increase that we are seeking is for mandatory and price 
level increases, the largest part of that for the cost of 
staff. About 80 percent of our budget goes to pay staff.
    As I described, $1.4 million is an increase to help fund 
our information technology modernization. That total 
modernization is going to cost us about $6 million a year for 
several years. We are absorbing most of that within our 
operating budget, as I said. We are asking for about $1.4 
million for 1999, to help fund that.
    [A question from Chairman Walsh and response follow:]

    Question. You are asking for an additional $1 million for 
technology modernization. The Committee has always supported 
these efforts at GAO. Why are these funds needed?
    Response. We have requested an additional $1.4 million for 
technology modernization, primarily to continue efforts to 
replace outdated hardware and related software upgrades and to 
fund Year 2000 corrections. The hardware and software 
replacements/upgrades are for GAO's existing information and 
communications infrastructure and are needed to support the new 
workstation and network platform to which the agency is 
migrating. A very small amount will be used to fund 
developmental efforts for GAO systems involving mission 
tracking and audit work.

                        staffing and performance

    Then there is no question that--the increase of another 
hundred FTE in our staff costs about $8 million, and there is 
no question that it does take money to do that. Our current 
staffing level is below 3,450, and we are working slowly toward 
that level. I think that, obviously, what we tried to do each 
year is look at available resources and move toward the 3,450 
level.
    Mr. Walsh. You have very strong advocacy in the House and 
in the Senate, and I think we all witnessed that last year in 
your budget. Interestingly, though, as you were forced to 
downsize, your productivity and all the indicators increased. 
So will we see a change in that trend as we add back employees?
    Mr. Hinchman. I hope that we can continue to improve those 
numbers. I attribute our ability to maintain productivity 
through the downsizing principally to two things. First was a 
reengineering of our job process to make it more efficient 
which also accounts for theprocess improvements that the 
committee sees in timeliness and in the length and cost of jobs. The 
second is information technology, and there is a trade-off between 
staff and technology in doing the work that we do, and I hope that we 
can continue to do better.
    Mr. Walsh. You mentioned a commitment of 3,450 FTEs. In 
your experience with this committee and the prior 
subcommittees, did someone give you that commitment of 3,450?
    Mr. Hinchman. I do not believe I used the word 
``commitment,'' and if I did, I apologize for that. I think I 
described it as a goal that we have tried to articulate as what 
we believe is a responsible level for our agency to point 
toward, and what we would then expect to maintain for a period 
of time. That does represent about a one-third reduction from 
the 5,300 level we were operating with prior to the downsizing.
    [A question from Chairman Walsh and response follow:]

    Question. Have you added staff since the 1998 appropriation 
was enacted? How many net FTEs do you plan to add this year? 
Your budget is predicated on an FTE goal of 3,450 FTEs. Where 
does that target come from? (Document for the record.) In what 
specific areas do you plan to allocate the 100 FTEs?
    Response. In fiscal year 1998, GAO received $346.9 million, 
which supports 3,225 FTEs. GAO plans to hire 250 staff and 
anticipates losing about 150 staff, netting about 100 
additional staff, during the year. Despite the planned addition 
of these staff, GAO estimates using 116 less FTEs than it used 
in fiscal year 1997. This lower FTE usage is the result of an 
extraordinarily high attrition rate experienced in fiscal year 
1997. As of January 31, 1998, GAO had hired 35 staff and lost 
61 staff since the beginning of fiscal year 1998. Recruitment 
will occur throughout the agency, primarily in our accounting 
and information management; resources, community, and economic 
development; general government; and health program areas.
    In response to the congressionally mandated 25-percent 
funding reduction, GAO developed a goal of and downsized to 
about 3,500 staff, equivalent to 3,450 FTEs, at the beginning 
of fiscal year 1997. GAO believes this staffing level is 
essential for it to fully support the Congress in its oversight 
of federal programs. GAO presented this staffing goal to the 
Appropriations Committees during its fiscal years 1997 and 1998 
appropriations hearings. Although never formally approved by 
the Congress, references to the goal can be found in fiscal 
years 1997 and 1998 budget hearing transcripts and Senate 
committee reports. Specifically, the goal is discussed in FY 
1997 Appropriations Hearing transcript, House of 
Representatives: pages 636-637, and 660; FY 1998 Appropriations 
Hearing transcript, House of Representatives: pages 335-336, 
337, and 379-380; FY 1997 Appropriations Hearing transcript, 
Senate: pages 1-3, 9-11, and 18-20; FY 1998 Appropriations 
Hearing transcript, Senate: pages 126, 130-131, and 133; Report 
S104-323, Legislative Branch Appropriations, 1997, page 42; and 
Report S105-47, Legislative Branch Appropriations, 1998, page 
45. GAO's fiscal year 1999 budget request of $369.7 million, 
which supports 3,325 FTEs, is intended to move it closer toward 
the staffing goal.

    [Questions from Mr. Cunningham and responses follow:]

    Question. How has the distribution and availability of your 
work product over the Internet, and you ability to perform a 
great deal of research over the Internet, changed the nature of 
your organization and your work product?
    Response. The Internet provides GAO an additional resource 
to inform the public about its products, conduct research, 
gather data, and communicate with researchers, scientists, 
academics, etc. The availability of the World Wide Web has led 
to a dramatic increase in the availability of our reports to 
congressional staff, journalists, academics, and the public at 
large. At the present time, about 200,000 GAO products are 
accessed each month over the web, a figure that has been 
growing each month. GAO has inaugurated a ``list serve'' to 
notify anyone who is interested in the availability of GAO 
products. This listing is sent by Internet e-mail at the close 
of each business day to subscribers. GAO began this service 
about 2 years ago by posting a notice on its home page. Today, 
more than 8,500 individuals worldwide subscribe to it.
    The Internet provides GAO staff easy access to vast, unique 
information and network resources. Available resources include 
access to electronic journals, newsletters, books, and library 
catalogues; access to numerous databanks and databases, such as 
census data; access to hundreds of public domain software 
packages; and access to various supercomputers that may be 
available to public users. GAO staff often find the Internet to 
be the only vehicle for obtaining documents relating to the 
National Performance Review issue area or for specialized data 
needed to conduct agency audits.
    Question. How has it affected your budget, and how is it 
likely to continue affecting your budget?
    Response. GAO's cost to use the Internet for fiscal year 
1997 was about $63,000. This is relatively inexpensive given 
the benefits of using the Internet to both conduct research and 
distribute reports. Since GAO reports are available on the web, 
we have reduced the number of hardcopy reports printed and 
distributed. Traditionally, GAO has not attempted to survey the 
reasons an individual orders a specific copy of a GAO report. 
With the availability of reports on the web, there is some 
indication that individuals may be ordering hard copies of GAO 
reports because they have found a report on the web and do not 
want to take the trouble to either download it or read it ``on-
line.'' If this is the case, the web may be driving demand for 
printed copies of GAO products.
    GAO is conducting a study of its distribution system, 
partly due to the way the web has changed GAO report 
distribution. One of the questions GAO hopes to answer is how 
much impact the web is having on distribution costs and whether 
there are alternatives to the present practice of allowing 
anyone to order a single printed copy of any report produced by 
GAO.

                       use of outside contractors

    Mr. Walsh. When you went through the reinvention of your 
role, did you use more outside contractors to help you attain 
your goals?
    Mr. Hinchman. We have been using outside contractors more 
than has historically been the case for our agency. We used 
about $4.8 million worth of outside contractor assistance to do 
audit and evaluation work during 1997. That number has been 
about that level for the last few years.
    Mr. Walsh. Do you anticipate increasing your use 
ofcontractors?
    Mr. Hinchman. We continue to look for ways to use 
contractors effectively. We have found that they are 
particularly important in obtaining specialized skills, which 
are hard to retain in our staff at our current staffing level. 
It has not been our experience that they are less expensive 
than the use of the other staff.
    Mr. Walsh. Is the quality of work different?
    Mr. Hinchman. Particularly within areas of specialization, 
such as actuarial services, it is the only way to get that 
expertise. Where the work calls for intimate knowledge of the 
operations of the government, such as particular or specific 
agencies of the government, sometimes our staff start from a 
more experienced point than outside contractors.

                      building renovation project

    Mr. Walsh. My last question regards your building 
renovation project. We understand you have negotiated an 
agreement with the Army Corps to finance the balance of the 
building renovation program. Could you outline that for the 
committee?
    Mr. Hinchman. Yes, sir.
    Our subcommittee in the other body, last year asked us to 
see if we could find a way to complete the renovation of our 
building without charging it against our appropriation. Because 
of our downsizing, we can afford, with some realignment of our 
own staff, to give up one floor of our building, and we have 
done that. We have a tentative agreement with the Army Corps of 
Engineers, that they will take over the third floor of our 
building.
    Under the tentative agreement, the Corps would use funds 
available to complete the asbestos removal and renovation of 
our building, and we would then, in effect, repay them for that 
investment through adjustments in the rent they pay over some 
period of time. The result would be that there would be no 
charge against a legislative branch appropriation directly 
associated with completion of that renovation. That agreement 
is tentative; there are some details that have to be worked 
out, but I believe we will be able to resolve them.
    Mr. Walsh. Will the billing rate be paid for real estate 
and construction issues?
    Mr. Hinchman. We will calculate a rent based on the market 
rate, and there would be adjustments to that in the early years 
for investments made in the renovation, yes.
    Mr. Walsh. Thank you.
    [A question from Chairman Walsh and response follow:]

    Question. For the record, insert all reprogramming requests 
and dispositions.
    Response. The information follows:

[Pages 553 - 555--The official Committee record contains additional material here.]


    Mr. Serrano.
    Mr. Serrano. After listening to you ask those exciting 
questions, I really don't have any questions.
    Mr. Walsh. Good, I will try to keep them exactly the same. 
That way we will be briefer.
    Fine, I guess we are finished with questions. Thank you 
very much.
    Mr. Serrano. Thank you.
                                       Wednesday, February 4, 1998.

                      JOINT COMMITTEE ON TAXATION

                               WITNESSES

HON. BILL ARCHER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS, 
    AND VICE CHAIRMAN, JOINT COMMITTEE ON TAXATION
MARY M. SCHMITT, DEPUTY CHIEF OF STAFF--LAW, JOINT COMMITTEE ON 
    TAXATION
BERNARD A. SCHMITT, DEPUTY CHIEF OF STAFF--REVENUE ANALYSIS, JOINT 
    COMMITTEE ON TAXATION
    Mr. Walsh. We now entertain the Joint Committee on 
Taxation.
    Welcome, Mr. Chairman.
    Mr. Archer. If I might have both of the Schmitts, Mary and 
Bernie Schmitt, join me here at the table. We had our chief of 
staff, Ken Kies, I think you know, leave us on the last day of 
last month, and we are awaiting the new Chief of Staff to come 
in; and Chairman Roth announced yesterday that that would be 
Lindy Paull, from the Senate Finance Committee staff, so--she 
has not yet come in, so we have to appear before you without a 
Chief of Staff right now. But we are well served by Mary and 
Bernie, who have been over at the Joint Committee for a number 
of years and are really mainstays in seeing that the Joint 
Committee serves us.
    Thank you for letting us come today. I have a relatively 
short oral statement, and Senator Roth and I have agreed on a 
longer written statement, and without objection, I would like 
that to be entered in the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 558 - 589--The official Committee record contains additional material here.]


                     Mr. Archer's Opening Statement

    Mr. Archer. For 1999, the request of the Joint Committee on 
Taxation is one that I will be mentioning to you and which is 
covered in detail in my written statement.
    The request for 1999 is $6 million and change--namely, 
$18,000. It is a net increase of $202,500 over the 1998 
appropriation, but it is still--and I need to point this out--
$1,000 less than the fiscal year 1995 appropriations, so we are 
going into 1999, 4 years later, with a request that is $1,000 
less than what was appropriated for the Joint Committee in 
1995.
    The increase that is requested over last year is attributed 
solely to projected cost of living increases, plus a 1 percent 
merit increase for personnel expenses. In the last Congress, we 
asked the Joint Committee staff to assume additional 
responsibilities, and I have told you about that in the past, 
and so some of this is going to be a reiteration; but in 
addition to the traditional role of the Joint Committee staff 
in the development, drafting, and estimating of proposed 
revenue legislation and the review of large income tax refund 
cases, the Joint Committee staff is now responsible for 
determining the unfunded mandates contained in revenue 
legislation and identifying, beginning in 1997, a limited tax 
benefit subject to the line item veto, and that entails quite a 
considerable bit of work, to be able to do the investigatory 
work and determine whether any provision that is in a tax bill 
is limited to 100 taxable entities or less. And I think you can 
imagine that there is a lot of work that has to go into that.
    I would say parenthetically that I believe it would be good 
for the Congress to review the line item veto law relative to 
the Tax Code and put it in a more workable form.
    During 1997, Joint Committee staff responded to over 2,000 
requests for revenue estimates from Members of Congress, and 
those seem to go up all the time. All of us have a special 
provision that we want to urge to change the Tax Code, and we 
of course need to get a revenue estimate.
    Mr. Walsh. Two thousand last year?
    Mr. Archer. In 1997, yes, which I think was last year if my 
memory serves me right.
    Mr. Walsh. Yes, I think so.
    Mr. Archer. And during 1998, the Joint Committee staff 
expects to receive at least 1,500 requests for revenue 
estimates.

                         MACROECONOMIC ANALYSIS

    In addition, the Joint Committee staff during 1998 will 
continue to pursue the feasibility of incorporating 
macroeconomic effects into the estimates of major tax 
legislation; and if you want to pursue that, I will be glad to 
expand on that, because that is a very ambitious goal. The 
Joint Committee in the past has done the specific analysis of 
estimates that the tax provision itself would bring about, but 
they have had to overlay that on CBO baseline estimates 
relative to the macro conditions, and the macro conditions have 
never been changed. So it doesn't matter how massive the tax 
change is, the Joint Committee figures in behavioral response, 
and then they figure in just exactly what impact that will have 
on the revenues of the Federal Government.
    But in any significant tax change, there is going to be a 
macroeconomic effect, too, on economic growth and on job 
creation, et cetera, which has feedback revenue through the 
normal income tax that is levied against those operations, and 
none of that is ever figured into these estimates now because 
of the disconnect between the Joint Committee and CBO. And 
CBO--and I don't want to get too complicated, but CBO has a 
baseline that they don't change when the tax proposal is put 
before them, it just stays the same, as if the tax change is 
not going to have any impact at all.
    So we are now beefing up, and that brings me to the 
important thing for the Joint Committee. We are beefing up 
their computer capability so they will be able ultimately to 
figure in these macroeconomic changes, and that is a 
significant undertaking.
    Mr. Walsh. Is that an art or a science?
    Mr. Archer. Probably a little of both, wouldn't you say?
    Mr. Schmitt. That is right. That is one of the problems. It 
is not a straight science; there is an art involved and the 
computer models are not at the level throughout the country 
they might be at.
    Mr. Walsh. I think it is obvious changes in the tax law 
change behavior both of individuals and corporations, so there 
is something dynamic to what the results are, but quantifying 
that must be pretty tough.
    Mr. Archer. Well, it is. Clearly, Mr. Chairman, it is very 
difficult, and when we get up to the capacity to do something 
like that, it should be done in a very conservative way, to 
where we can be sure that we are not overestimating the 
macroeconomic effects.
    But all economists--as you have said, all economists will 
agree, any significant change in tax law is going to bring 
about a macroeconomic change. They disagree as to the 
magnitude, but to totally ignore it does not lead us to correct 
estimates, and we are always pursuing accuracy in estimating. 
That is my goal. I don't want a fair advantage or a distortion, 
because I happen to believe in the proposal. I want accuracy; 
to know when we make a decision that we can rely on the 
results.
    We believe that the amount requested is a minimum amount 
necessary to finance the operations of the Joint Committee in 
1999. It provides essential services, really, that aren't 
duplicated by any other congressional or executive branch 
office, and I frankly believe--and I think you know how tight I 
am on spending taxpayers' money--that if we don't get this 
requested funding that we in effect will jeopardize the ability 
of the Joint Committee to provide the necessary services. And 
again, parenthetically, I hope one day to not have to be in 
here asking for any increases, because when we abolish the 
income tax and go to a specific tax on sales, we will not have 
to worry about all of these things. All of these estimates that 
are requested and everything else by members will disappear, so 
maybe you can look forward to that day, too.

                           NATIONAL SALES TAX

    Mr. Walsh. If I could interrupt for a second, my wife 
called me yesterday and there is a national campaign, as you 
know, on the national sales tax, and she has been hearing some 
of the commercials and you have to hear the things three or 
four times before they start to sink in. And she said just what 
you suggested, I will give you an opportunity to comment on 
this, this is not within the realm of our subcommittee, but it 
is interesting. But she said--and we talked about tax changes 
changing behavior, she said, if you went to a sales tax of 23 
percent, for example, that will hurt the economy, won't it? 
This is what she is saying, because the cost of everything is 
going to go up 23 percent. Do you have any idea what the impact 
on--and it is a very consumer-based economy--what the impact 
would be?
    Mr. Archer. Do you want to get into that issue now? I would 
be more than happy to address it.
    Mr. Walsh. We have a couple of minutes.
    Mr. Archer. Number one, for the first time in my lifetime, 
every worker will have their entire paycheck, will be totally 
unreduced by even--in the proposal that you are talking about, 
which is being advertised now--and I am speaking only about 
that proposal, only to that proposal.
    Mr. Walsh. That is what I am speaking of, too.
    Mr. Archer. Because they abolish payroll tax as well as 
income tax, so every worker will have their entire paycheck, 
undiluted and undiminished to spend, and that is going to give 
them more spendable income on average than the amount of the 
tax, so it just depends. You and I have the discretion. When 
you want to pay your taxes, it is not automatically taken out 
of your pay without any control on your part. You have the 
money to buy, would you still buy; and the economic analyses in 
studies that have been done show that it will actually increase 
consumption, but it will also increase savings. You will get a 
win-win situation, because the economy will grow so much. The 
projections are that in the first year, the economy will be 13 
percent higher.
    Mr. Walsh. Thirteen percent, that is GDP?
    Mr. Archer. GDP will be 13 percent higher, and that drifts 
down to where, over the long term, it would be between 9 and 10 
percent higher than it would otherwise be with the income tax.
    Mr. Walsh. Nine or 10 percent higher than it would have 
been? Not GDP?
    Mr. Archer. Not growth each year, but 9 percent above what 
it otherwise would have been.
    Mr. Walsh. The first year would be 13 percent higher?
    Mr. Archer. That is correct.
    Mr. Walsh. Okay. I misunderstood you.
    Mr. Archer. That is 13 percent growth in the first year.
    Mr. Walsh. As opposed to the current 3.8 we had in 1997.
    Mr. Archer. Correct. It will massively improve the economy 
for everybody for a variety of reasons. Number one, you will 
eliminate an enormous amount of unnecessary compliance costs 
and instead of the economy spending the money on that, it will 
be spending it on production of wealth; that is number one. You 
have about a $250 billion compliance cost annually in the 
current income tax code, and most all of that will disappear, 
and that will be an enormous saving to the economy.
    Interest rates will go down by as much as 200 basis points 
and that will reduce the cost of operation of every entity in 
the country. It will reduce the price of homes. If you have 
$100,000 home over a 30-year mortgage, it cuts your mortgage 
payments down $37,000, so it will, in effect, reduce the price 
of your home over 30 years by $37,000.
    It will open up export opportunities, the likes of which we 
haven't seen, because the imbedded cost of income tax will no 
longer be in the price of our products sold overseas, which 
means our products will sell for 20 percent less than they do 
today, on average. It will vary, industry by industry, but on 
average, 20 percent less. And incoming foreign products will be 
forced to pay the tax which--they don't pay any income tax, and 
they will then start to pay a fair share of our cost of 
government.
    So the combination of a 20 percent tax that can be 
legitimately and, under WTO rules, put on incoming imports, and 
the reduction of the price of our exports will make America 
into the most unbelievable exporting country you can ever 
imagine; and factories will begin to mushroom in the U.S. 
again, for export, the likes of which we haven't seen since 
World War II. I mean, these are all of the things that will 
generate the benefit to workers.
    But, in addition--on the question that your wife asked, in 
addition, not only will you have your whole paycheck to where 
you can afford more than what the tax is, but within a 
relatively short period of time, the embedded cost of income 
tax will be removed from the price of the products and the 
price of the products will go down.
    Mr. Walsh. What about--the obvious question that springs to 
mind is, what about people who are either on public assistance 
or some sort of fixed rate income base that is not going to 
experience that 23 percent?
    Mr. Archer. Number one, there would need to be a credit 
rebate or waiver system for low-income people to be sure they 
are not disadvantaged by the new tax in the short term, but in 
the long term, it will be a win-win deal for them because as 
they get their rebate or credit or waiver and prices go down, 
they are going to be even better off. And so it is a win-win 
deal for America.
    But your wife asked a very good question.
    Mr. Walsh. She always does, and now I can say I have a very 
good answer.
    Mr. Archer. I have not personally embraced the proposal 
being advertised out there because I am not sure you want to 
bite off--eliminate the payroll tax in one fell swoop, that is 
a big bite to take compared to the current system. But in any 
event, it will certainly, certainly reduce the burden on this 
subcommittee that you chair because all of the compliance costs 
that have to go in, all of what Mary and Bernie have to do over 
there at the Joint Committee will be cut back dramatically.
    Let me also, if I may, if you will indulge me, make a 
suggestion to you as to where you can save some money that will 
more than pay for the increase that is requested by the Joint 
Committee, so that you will net out in a far better position 
than you are today. It has been called to my attention that CRS 
duplicates much of what the Joint Committee does with the 
computer model that is very expensive over at CRS. That is 
totally unnecessary, completely unnecessary to add that 
duplication over at CRS. And I would suggest that your 
committee take a very long look at the money that is being 
appropriated for CRS in an overall sense, not just on the tax 
issue side, and do an investigation and see how much of the 
work they do over there is the result of requests from Members 
of Congress and how much is gratuitous on their part that 
nobody has ever asked for and that hardly anybody ever benefits 
from.
    Mr. Walsh. We will be happy to do that. I think it is a 
good suggestion, and we will do it. Let me ask you, that brings 
me to the real question I want to ask you, regarding the Joint 
Committee, and it was what we heard a lot about last year as we 
went through the budget. That was the question raised about 
providing revenue estimates to non-Ways and Means or Finance 
Committee Members.
    You mentioned that there were 2,000 requests. Have you 
included in your full testimony any extensive statistics 
regarding the numbers of requests you received from non-
Finance, Ways and Means committee members?

                           revenue estimates

    Mr. Archer. I am going to let Bernie or Mary speak to that.
    Mr. Schmitt. We have attached attachment D which gives a 
summary of the 104th and 105th Congresses, and if you look at 
it, you will see that for last year, out of a little over 2,100 
requests from Members of Congress, we were able to respond to 
about 66 percent overall, and that was only slightly more to 
Ways and Means and Finance members than it was to the 
noncommittee members. So we felt we did a very good job.
    Mr. Walsh. The percentage of responses to member or non 
member requests was about the same?
    Mr. Schmitt. Pretty consistent when we tabulated it. I 
think we have done a pretty equitable and nonpartisan job.
    Now, if you look at this, you may see a slight discrepancy, 
if you can look on the 105th Congress columns, you will see 
that if you divide the numbers of replies by the numbers of 
requests, you get a slightly smaller percentage than shown on 
the table. This is because the percentages were derived after 
adding to the numbers of formal replies shown here the numbers 
of replies in forms other than formal written replies, that is, 
replies given orally or provided in tables.
    Mr. Chairman, this attachment relates to revenue estimate 
requests and the Joint Committee staff does provide other 
services to non-Tax Committee members. We worked on, I believe, 
eight tax treaty pamphlets for the Senate Foreign Relations 
Committee last year. We provided testimony to one of the House 
Banking subcommittees on HUD programs, we did an energy study 
for Senator Murkowski and his committee, and we also spent an 
extensive amount of time working with the D.C. subcommittees in 
the House and Senate on the D.C. legislation last year. So in 
addition to the revenue estimates that we provide to the non-
Tax committees, we do provide other services as well.
    Mr. Walsh. As you know, there was some criticism. Do you 
feel it was unjustified then, given the statistics that you 
have?
    Mr. Archer. It depends, Mr. Chairman, on how you look at 
it. If you look at it on the basis that we have not been given 
the resources we requested to have greater capability to 
respond, I think it is unfair; but if we came to you and said, 
in order to respond to 90 percent of all the requests, and I 
guess we never get totally to 100, or 95 percent, it is going 
to take ``X'' amount of additional resources, the question is 
whether you would give them or not. Because I can tell you, the 
hours are never too long for these people at the Joint 
Committee, they are there, they are there when other people are 
sleeping and they are there before other people wake up, and I 
believe it is an unfair complaint.
    Based on the resources, I think to get two-thirds of the 
requests answered, considering how much they are increasing and 
how much more complex the determination is becoming as the code 
becomes more complex, the criticisms are unfair. But if I am a 
member that asks for an estimate, I want it, and I want it now, 
so I am going to think it is not fair if I don't get it.
    Does that answer your question?
    Mr. Walsh. Yes, it does. Thank you, Mr. Chairman.
    Mr. Serrano.

                         work of jct this year

    Mr. Serrano. Thank you. Thank you, Mr. Chairman. It is 
interesting, your mentioning CRS and for us to take a look at 
it in favor, perhaps, of your committee. If you recall, that 
was one of the problems last year, the perception, if you 
recall, during the whole battle we had, where the bill was held 
up for a couple reasons. One of them was the Loretta Sanchez 
issue, which got taken care of today. It is kind of dramatic, 
because we are dealing today with both issues; today we might 
be able to solve them all and have the bill on the floor next 
week.
    But another of the issues was, in fact, that your committee 
was acting in some partisan way, whereas CRS doesn't get 
accused of that for the most part. A lot of it had to do, 
watching the leadership on my side complain, had to do with the 
director who is no longer there, so I think this is a great 
opportunity, perhaps, to sort of begin anew.
    I also understand that last year, one of the complaints was 
the request for new staff positions, and I know that this year, 
that is not the case any longer, so that should also be put 
aside. One observation on my part is that your committee, Mr. 
Chairman, suffered somewhat from what this committee suffers 
from. A lot of other issues on how people are getting along 
with each other on both sides of the aisle come to play on your 
committee, just like on this one.
    Now, you already mentioned, and we did discuss your tax 
proposal, but one of my questions was, how would the work of 
the committee be affected by your vision of what proposals will 
come before us this year. We hear everything from we have 15 
days in session this year so there will be budget, 
appropriations, and then wrap up and send everybody home.
    Mr. Archer. That sounds a wee bit overly optimistic.
    Mr. Serrano. It is not too bad; actually, it would probably 
work to everybody's favor. But I am not one of those who 
believes we harm the Nation when we are in session.
    Do you foresee other proposals reaching us?
    Mr. Archer. I really don't know.
    Mr. Serrano. And how would that affect your committee?
    Mr. Archer. I think it is too early to speculate on what we 
may or may not do this year, because a lot of it relates to the 
budget and how the budget works out. Without getting into 
detail on that, we can't turn a crank on tax legislation until 
we find out what the budget document is going to permit us to 
do. So that limits my ability to speculate.
    But I also would like to divide, if I may, for you, the 
Joint Committee and the Ways and Means Committee, which are, of 
course, two separate entities; and today we are really only 
talking about the Joint Committee's budget. And I know 
perception is important in the lives we lead, but I think the 
Joint Committee, whether we have had a Republican Majority or a 
Democrat Majority in the House and the Senate, has operated 
professionally. And Mary and Bernie have been there through 
both different majorities, and they haven't changed, they 
haven't changed from their professional approach to doing a job 
and doing it as accurately as possible.
    So the Joint Committee, I think, if you talk to Charlie 
Rangel or his staff on the Ways and Means Committee, would tell 
you they are very responsive to his requests, just as much as 
they are to Republican requests. And the one wonderful thing 
about them is, over the years, they never breach a confidence, 
there are no leaks and they do not breach a confidence; and 
even though I am Chairman of the Ways and Means Committee, I 
never ask them because I think it would be inappropriate, but 
they would not tell me what the Democrats are working with them 
on. There is no way that I am ever privy to that, and I 
shouldn't be; and they do an incredibly professional job in 
serving, on a nonpartisan basis, the Democrats and the 
Republicans in the House, and the Democrats and the Republicans 
in the Senate, so they have got a really tremendous 
responsibility that is virtually unique on Capitol Hill.

                         overlapping functions

    Mr. Serrano. One last question, one of the issues which 
speaks to the CRS situation, but in reverse. Members of the 
subcommittee have been asking whether functions of various 
legislative branch agencies and offices overlap. So it should 
be fair to ask if there have been any problems with overlapping 
between, say, the Joint Economic Committee or CBO or any other, 
and if so, how so.
    Mr. Archer. I don't think there is a problem in my--and I 
can let Bernie and Mary speak to this, but in my view, I don't 
think there is a problem overlapping with CBO, but I do have a 
problem with the disconnect I mentioned earlier, between the 
inflexible baseline and then the overlay of the tax estimates 
on something, as if it is not going to change. And in some way 
or another, we have to bring those two together, and that is 
why we are now moving toward gearing up the Joint Committee to 
do for tax purposes a macroeconomic impact study. We are not 
there yet, and I don't know how many years it is going to take 
us to get there; it is way off. But I don't think there is any 
overlap.
    I think, relative to CRS, there is, because CRS has built a 
computer capability relative to taxes, but they have no 
official function. In the end, whether we like it or not--and I 
have argued with Bernie over the years about certain estimates 
that I didn't think were right, but in the end, the official 
estimates they put out are what determine our activities 
budgetwise in the Congress, and we have to comply with that, 
and the law requires that we comply.
    So what CRS is doing is just like something else that is 
orbiting around the system, but really is not a part of it.
    Mr. Serrano. I have no further questions.
    You know, you noticed I did not join in in asking any of 
the questions when he was asking about this tax plan, but 
sometime I want to ask if that is on top of the 8-point-
whatever tax I pay in New York State, or does that tax do away 
with that?
    Mr. Walsh. State income tax has gone down the last 3 years 
in a row.
    Mr. Archer. But I would simply say it would merely replace 
whatever the Federal tax burden is and whatever Federal tax 
burden there is is on top of whatever your state tax burden is.
    Mr. Serrano. Thank you.
    Mr. Archer. Thank you
                                       Wednesday, February 4, 1998.

                          U.S. CAPITOL POLICE

                               WITNESSES

HON. WILSON LIVINGOOD, SERGEANT AT ARMS, U.S. HOUSE OF REPRESENTATIVES, 
    AND CHAIRMAN, U.S. CAPITOL POLICE BOARD
HON. GREGORY S. CASEY, SERGEANT AT ARMS, U.S. SENATE, AND MEMBER, U.S. 
    CAPITOL POLICE BOARD
ALAN M. HANTMAN, AIA, ARCHITECT OF THE CAPITOL, AND MEMBER, U.S. 
    CAPITOL POLICE BOARD
GARY L. ABRECHT, CHIEF, U.S. CAPITOL POLICE
    Mr. Walsh. We will now take up the U.S. Capitol Police 
budget, which will be presented by the Capitol Police Board. 
The members of the board are accompanied by Chief Gary Abrecht 
and members of his staff.
    Welcome, Chief.
    It is good to have the Chairman of the Capitol Police Board 
with us today, House Sergeant at Arms, Bill Livingood.
    Welcome, Bill.
    We also have Senate Sergeant at Arms and Doorkeeper, the 
Honorable Gregory S. Casey.
    Welcome.
    Another board member. We welcome both of you to visit with 
the committee.
    The third board member is Architect of the Capitol, Mr. 
Alan Hantman, whom we also welcome back again today.
    Before we proceed, let me state the budget request 
submitted to the committee. Members will find the details 
beginning on page 301 of Part I, and on page 115 of the 
subcommittee print.
    Overall request is for $84.5 million, of which $76.1 
million is for salaries, $8.4 million is for general expenses. 
These funds would support 1,257 employees, an increase of two.
    We have your statement, Bill; please summarize. And I am 
not sure who you want to proceed first.
    Go ahead.

                   mr. livingood's opening statement

    Mr. Livingood. Thank you, Mr. Chairman, Mr. Serrano, Mr. 
Cunningham. I am pleased to appear before you to present the 
fiscal year 1999 budget request for the U.S. Capitol Police.
    As this budget request shows, we have reached an 
interesting point in the professional development of the U.S. 
Capitol Police. More than at any time in the past, the Capitol 
Police is undergoing a period of change in order to meet the 
increasing demands of its mission. Not only must we guard 
against new threats to the safety and security of the Capitol 
complex, but the manner in which we meet these threats is 
evolving.
    In the past, we considered a proper response to new 
security threats--the proper way to answer that was to add more 
police officers to the department. That was the case following 
the 1954 shooting in the House gallery and the 1971 and 1983 
bombings in the Senate wing of the Capitol.
    Today, as we prepare to enter the new century, this next 
century, the U.S. Capitol Police Board feels the most and the 
more effective and efficient manner of better securing the 
Capitol complex rests with the increased use of technology and 
with training. While the safety and security of the 
congressional community and visiting public will always 
primarily rely on highly qualified and highly trained police 
officers, the application of state-of-the-art security 
technology can certainly be used to augment the officer in the 
field.
    To this end, we have included five new components in the 
general expenses of the appropriation that are key to setting 
this initiative in motion: the hazardous materials program, 
information security systems, life cycle replacement of 
physical security systems, physical security annual 
maintenance, and the new physical security systems 
installations. Each is considered to be integral to the overall 
risk management efforts of the U.S. Capitol Police because they 
are needed to detect, deter, or mitigate the effects of 
security threats.
    Increased operational and administrative demands placed on 
the department translate into increased demands on our 
personnel; therefore, it is essential that we provide our 
officers and support staff with the level of training they need 
to keep pace with the changing nature of their jobs. The 
requested level of funding for tuition expenses will be used to 
provide outside professional instruction to our personnel on 
topics ranging from labor-management instruction, or labor-
management relations, to chemical and biological attack 
response.
    With regard to personnel issues, it has been a longstanding 
goal of the U.S. Capitol Police Board to ensure that the men 
and women of the U.S. Capitol Police maintainpay parity with 
their counterparts in other law enforcement agencies. Therefore, the 
U.S. Capitol Police, fiscal year 1999 budget submission, once again, 
includes a request to fund pay initiatives, which provide for holiday 
pay, Sunday premium pay and shift differential.
    Because police departments need to be staffed 24 hours a 
day, 7 days a week, this type of differential pay is considered 
standard and customary in law enforcement agencies. Therefore, 
in order to fairly compensate our personnel, who are required 
to work throughout the night on Saturdays and holidays, the 
U.S. Capitol Police Board feels that it is imperative that the 
initiative be fully funded.
    Finally, Mr. Chairman, I would like to state the support of 
the Capitol Police Board for the funding, which is included in 
the Architect's budget submission. Several facilities currently 
used by the U.S. Capitol Police can no longer adequately 
support the mission of the department. The current condition of 
some of these facilities creates life, safety and working 
condition concerns for our personnel. Others such as the Off-
Site Delivery Center and the Vehicle Maintenance Facility have 
simply outlived their usefulness and are in need of significant 
repair and expansion or relocation to another site.
    This is especially true of the Off-Site Delivery Center due 
to the increased level of its use, which is anticipated when we 
begin screening House deliveries. In addition, our training 
facilities are woefully inadequate. The entire primary training 
facility of the U.S. Capitol Police consists of three converted 
offices in the Ford office building. It is simply impossible to 
support the training needs of a 1,300-member department with a 
mission as diverse and important as the Capitol Police in three 
classrooms in an office building.
    In response to these concerns, the Architect has requested 
an appropriation to commission a comprehensive study of the 
facilities requirements of the department. Known as the Capitol 
Complex Integrated Security Facilities Program, this study will 
serve as a blueprint on how best to address these facilities 
concerns. In the interim, the Architect is requesting funding 
to address the immediate repair and Occupational Safety and 
Health Administration regulations concerns. In view of these 
pressing issues, the board is requesting full funding for all 
of the Architect's budget requests affecting the U.S. Capitol 
Police facilities.
    Over the course of the last year, we have met and heard the 
concerns of the committees of jurisdiction regarding how to 
best protect against the threats on security concerns we face 
today. This budget submission reflects a reasonable, measured 
and prudent approach to ensuring the safety and security of the 
U.S. Congress, the Capitol complex and the visiting public and 
the viability of the U.S. Capitol Police. We will continue to 
work with you and the authorizing committees as we address 
various issues concerning risk management, security and law 
enforcement.
    In closing, I would like to commend the men and women of 
the U.S. Capitol Police. Regardless of the challenge, they 
continually perform their duties in a diligent and professional 
manner. The responsibilities which rest on the shoulders of our 
personnel are daunting. Each day, they must ensure the safety 
and security of the congressional community and thousands of 
constituents by protecting them from crime and acts of 
violence. In doing so, they allow the national legislative 
process to proceed unhindered. However, in order to remain 
viable, the level of support the U.S. Capitol Police receives 
must be commensurate with the level and quality of service 
expected by the Congress and the public. This budget request is 
intended to meet that goal. A detailed budget for the Capitol 
Police has been submitted to the committee. I will be pleased 
to answer any questions that you may have.
    [The information follows:]

[Pages 602 - 603--The official Committee record contains additional material here.]


    Mr. Walsh. Mr. Casey, would you like to make a statement?

                     Mr. Casey's Opening Statement

    Mr. Casey. Yes, I would. First, thank you for allowing me 
to be here. I appreciate the opportunity to come and represent 
the men and women of the U.S. Capitol Police force. I think you 
have a copy of my prepared text, so I will, indeed, be as brief 
as I can.
    I, first, want to point out that I believe the United 
States Capitol Police has become a premier law enforcement 
agency in this country. It is now involved in a number of 
national security-related activities that were once considered 
beyond the scope of the Capitol Police Board. Indeed, in all 
respects, the U.S. Capitol Police is a full partner in the law 
enforcement community and the intelligence community. It speaks 
highly of the people and the management of the United States 
Capitol Police.
    In the last couple of years, we have done some things that 
I think qualify as extraordinary, things that you probably 
didn't see, which, again, speaks highly of how they have been 
implemented. As I stated in the letter to each of you, when I 
passed the gavel of Capitol Police Board chairmanship to my 
friend, Mr. Livingood, here, maybe my biggest challenge and one 
of our biggest challenges is to make sure the management 
processes of this department are as rigorous and as current and 
up to date as our security implementation plan is. Our effort 
in that regard remains one of self-evaluation of those areas 
where we already know we can make improvement in order to make 
this department more efficient and more cost-effective.
    There are several remaining systems such as the time and 
attendance, inventory control and personnel management, which 
are antiquated and are not yet widely compliant. We have an 
obligation to get those fixed. For the second year in a row, 
Mr. Chairman, we have included in the police budget funds to 
cover the police department's telecommunications and computer 
expenses.
    For the last several years, the expenses for both of these 
have been accommodated and absorbed into the budget of the 
Senate Sergeant at Arms. Hopefully, we are changing the way the 
Senate Sergeant at Arms does business so that resources and 
assets are allocated on a project-by-project basis upon an 
approved project plan. In this particular case, there is no 
such thing for the Capitol Police computers and telephones. 
Customers who are submitting private plans to the Senate 
Sergeant at Arms are also going to have to come up with some 
dollars to implement that plan.
    As I said last year, it seems to make good sense that if 
this is a critical function to the Capitol Police, which of 
course, obviously computers and telecommunications is, it 
should be something that they have control over and they 
currently do not. I would like to also support Bill Livingood's 
comments with regard to the department's pay initiatives. In 
the simplest of terms, we ask our police force to do a lot. And 
this police force meets every one of those expectations.
    The requested provisions of night differential, holiday and 
Sunday premium pay are nothing more than equity and 
comparability with counterparts in Federal agencies. I also 
want to share the police board's concerns for the functionality 
and suitability of several of our facilities. I think Bill 
mentioned all of those. A top-notch law enforcement agency like 
we have deserves better.
    We also need to complete the K-9 facility which I would 
like to add houses the Nation's number one dog team. The 
Architect of the Capitol, Mr. Hantman, a welcome addition to 
the police board, has been extremely valuable in helping us 
scope out some of these facilities issues. We will be talking 
about that later, to include finishing the K-9 facility.
    Lastly, is the issue of perimeter security plan. I know 
Alan talked a great deal about that so I won't belabor the 
point. We must implement an upgrade to the perimeter security 
plan. No action is not a viable option. We have looked at 
various options and we have settled on the one that we have 
provided to the Senate Rules Committee and we talked with Mr. 
Thomas about it. This option, we believe, is the most cost-
effective and best at-risk management. It is a fully integrated 
plan that when it is up and running and fully implemented, we 
believe, meets the needs both of cost and security. Mr. 
Chairman, I think that will conclude my statement.
    [The information follows:]

[Pages 606 - 607--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much. Are there any statements 
either from the Architect or from Chief Abrecht at this time?
    Mr. Hantman. I submitted my statement for the record. My 
remarks will generally follow the flow of that statement.
    [The information follows:]

[Pages 609 - 614--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you. Chief.

                   Chief Abrecht's Opening Statement

    Chief Abrecht. Mr. Chairman, I appreciate the opportunity 
to come and testify on behalf of the 1999 budget for the 
department. In the past year, the Capitol Police has made 
significant progress in a number of areas, particularly in the 
area of critical incident management. Most notably, we are 
continuing to enhance our ability to respond to and mitigate 
the effects of a chemical and biological attack, one of the 
more serious terrorism issues that is currently confronting all 
of us. We have conducted detection and response training for 
our personnel and have acquired quite a bit of specialized 
equipment.
    During the last State of the Union, we mustered a rather 
substantial amount of equipment and personnel and resources 
from other agencies in order to be prepared for such an 
incident during that event, which fortunately, obviously, did 
not occur. These are massive and very complicated issues we are 
devoting an immense amount of time to.
    While there is still much work to be done, I am confident 
that the Capitol Police is taking a proactive role in 
addressing this form of terrorism. We have also taken great 
strides in addressing more general life safety issues. We have 
developed the Capitol Buildings Emergency Preparedness Program 
and distributed emergency evacuation brochures to every office 
within the Capitol complex. These brochures, which comply with 
OSHA requirements, will ensure that every staff member will 
know how to safely evacuate in case of an emergency within 
their building.
    An important part of our preparedness effort is the 
formation of the Critical Incident Command Group. This group 
brings together the United States Capitol Police, the House and 
Senate Sergeant at Arms, the Architect of the Capitol and the 
Office of the Attending Physician to coordinate the response to 
an emergency situation. This entire process was tested in 
December when we conducted the first ever evacuation drill of 
the United States Capitol in conjunction with the D.C. Fire 
Department and the Emergency Medical Service. Such drills are 
beneficial to the staff, who can familiarize themselves with 
evacuation routes and assembly areas, and also serve as a test 
of our response and command capabilities. We intend to continue 
to hold these drills.
    We have learned quite a lot from the particular one we held 
in December about such simple things as hose couplings on fire 
trucks not matching the fittings inside these buildings. Things 
that you don't know unless you actually drill on it. The fact 
that there is little or no water pressure in the fire hydrants 
out on the plaza, and a few other things like that we found out 
were really quite fascinating, and are now being addressed 
because we had this drill. We are going to continue to hold 
them in other buildings around here.
    I am also pleased to report that the repair and upgrade of 
physical security systems within the Capitol complex is 
proceeding smoothly. This effort is part of a three-phase 5-
year plan to modernize the alarms, cameras and security 
equipment we utilize to protect the Capitol buildings and the 
congressional community. Once this plan is fully implemented, 
all of our security systems will be state of the art and fully 
integrated, thus allowing for improved police operations and 
response to alarms in offices and committees.
    Clearly the mission and responsibilities of the Capitol 
Police are expanding and evolving. Therefore, this year's 
general expense budget, as Mr. Livingood alluded to, contains 
several items which reflect the increasing level of Capitol 
Police responsibilities. The first such item is the hazardous 
materials program, which incorporates our chemical and 
biological response initiative. This initiative requires very 
specialized equipment, which is needed to detect and mitigate 
the effects of such an attack. As this program develops, the 
equipment which will be purchased with the appropriation will 
be integral to maintaining our risk-management efforts.
    The second item concerns the information security systems. 
In order to provide for the protection of national security 
information, the Capitol Police conducts operations to ensure 
that the complex operates free from the threat of surreptitious 
and clandestine listening devices and monitoring systems. The 
equipment we currently use to perform this function is in need 
of replacement. Therefore, the funds requested for information 
security will allow us to purchase the technological equipment 
needed to perform this critical function.
    Finally, we have requested funding for the Physical 
Security Systems Program. As a result of the support and 
leadership of this committee, funding was provided to implement 
the three-phase plan, which will vastly improve our physical 
security systems. However, as this system is installed, it is 
time now to begin to put all of this equipment and all of our 
physical security equipment on a life cycle replacement basis.
    One of the problems that the Congress has had over many, 
many years is that we have operated in this arena on a crisis 
basis. We bought X-ray machines and physical security equipment 
as a result of bombings in 1971 and 1983. We made these one-
time purchases and no one thought that ultimately this 
equipment wears out and has to be replaced. Then, when you buy 
it in large blocks like that, after 10 years or so it all dies 
and then you have nothing. Then there is a big need to replace 
it all.
    We need to put this entire system on a life cycle 
replacement basis so that every year we buy two or three X-ray 
machines, every year we replace four or five video cameras, 
every year we replace a small percentage of this equipment as 
it ages in a systematic fashion so that we will continue to be 
at the highest level of technology.
    This year, we have also requested an increase in the 
funding level for our fleet vehicles. In the past few years, we 
have had to divert money from this account to fund protective 
operations. In doing so, we repeatedly had to extend the useful 
life of several of our vehicles. In order to ensure that our 
fleet is safe, modern and able to meet the demands of police 
work, these vehicles need to be replaced. This requested 
increase will allow us to make a number of vehicle purchases 
that have been repeatedly delayed.
    I also join the members of the board in requesting your 
favorable consideration of the Architect's request to fund the 
Capitol Complex Integrated Security Facilities Program. This 
study will provide a means to prepare a comprehensive plan to 
address several very serious facilities problems thatwe face. I 
have an immediate concern, however, about the current condition of the 
K-9 training facility, which continues to need additional work, the 
Rayburn firing range, which is a relatively small item, which is in my 
budget for a new backstop for that range to keep bullets from exiting 
the firing range into the garage which would be an unfortunate 
situation.
    Mr. Serrano. You mean where I park?
    Chief Abrecht. Yes, sir. I don't know whether you park on 
the G-1 level. The backstop is in need of replacement. I assure 
you there is no immediate concern that a bullet is going to 
exit.
    Mr. Walsh. Remember when you asked this morning about what 
absolutely had to be done? I think that is one of those.
    Chief Abrecht. The last time we took the backstop down 
there was some real concern that it was deteriorating to the 
point that it could at some point allow a bullet to pass and 
that is clearly a serious issue, and the Off-Site Delivery 
Center, which has already been mentioned, which is really in 
very dire straits and in need of some substantial replacement 
or upgrade.
    Once again, this year's budget, as both Sergeants at Arms 
have mentioned, contains a request to provide our personnel 
with shift differential, holiday pay and Sunday premium pay. 
Since police departments must operate adequately 24 hours a 
day, 7 days a week, this type of compensation is routine in law 
enforcement agencies throughout the United States. It is also 
provided, interestingly enough to most of the legislative 
branch service organizations, which have 24-hour operations, 
such as the Library of Congress, the General Accounting Office, 
and the Architect of the Capitol.
    An Architect of the Capitol employee who works on a holiday 
gets paid holiday pay to do that. A Capitol Police officer does 
not. A Library of Congress police officer who has to work on 
the holiday gets paid holiday pay. If he works late at night, 
he gets paid shift differential. If he works on a Sunday, he 
gets Sunday premium pay. The Capitol Police officer does not. 
It is a straight-up issue of equity as far as I can see. It is 
routine in law enforcement, it is routine in legislative branch 
service entities. We are the only ones who are not so included.
    I just think it is a simple matter of fairness and equity 
with a standard in the law enforcement community and, frankly, 
a standard on Capitol Hill for people who work late at night on 
the holidays. When my officer is here Christmas Day doing that 
for no additional compensation, I just don't think that is 
fair. I don't think many people would think so, either.
    Mr. Cunningham. Bah humbug.
    Chief Abrecht. May I quote you to the officer, sir?
    Mr. Cunningham. No, no, no, no.
    Chief Abrecht. I didn't think so. I didn't think you meant 
it.
    Mr. Cunningham. Just seemed like the thing to say at the 
time.
    Mr. Walsh. The reporter is writing.
    Chief Abrecht. We have also included amounts for 
reimbursing the Senate Sergeant at Arms for computer and 
telecommunications services in our budget again this year. Mr. 
Casey has addressed this issue. Frankly, I guess I feel a 
little like the old maxim ``when the elephants fight, the grass 
gets hurt.'' Obviously, the House and the Senate have a 
disagreement as to how telecommunications and computers should 
be funded for the Capitol Police. The thing that scares me to 
death is that this ball is going to be bounced back and forth 
and it is going to fall between two chairs here and I am going 
to end up with no computer services and no radios. You don't 
run a police department for more than a couple of days before 
it all collapses if you don't have computers and radio systems. 
The Senate Sergeant at Arms has funded that in the past. It 
just needs to be funded somewhere. I would urge the committee, 
when this comes to conference, that somehow this issue get 
resolved in some fashion, because that is obviously a 
tremendous concern to us.
    Finally if I could close on a cheerful note, and that is 
just to thank the committee for their prodding and support of 
our unified payroll initiative over the years. As you recall, 
last year we reported that we had successfully transferred the 
House payroll to the National Finance Center. That is working 
extremely well. Everybody got paid on time, 100 percent of the 
officers were paid on time. It has virtually eliminated some of 
the problems we have had with people complaining about their 
overtime not being received in a timely manner and so forth.
    A month from now, on March 1, we will be moving the Senate 
payroll down to the National Finance Center, after which we 
will have a unified payroll system for the Capitol Police. That 
has been a goal that we have had and this committee has frankly 
prodded us on over the years. I really am grateful that that 
was made to come to pass largely by the support and really the 
initiative of the committee. I thank you for that.
    I am proud of the level and quality of service the men and 
women of the United States Capitol Police provide on a daily 
basis. Securing the Capitol complex is a daunting task. With 
the support of the Congress, we have faced and overcome many 
challenges in the past. Many of the items included in this 
budget request provide a glimpse of future risk management 
challenges and concerns and give insight into how we are 
preparing to address them. As this budget submission shows, we 
intend to build upon past operational and administrative 
accomplishments, undertake new initiatives in the most cost-
efficient and effective manner possible. I thank you.
    [The information follows:]

[Pages 619 - 621--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you, Chief. Thank you all not only for 
providing testimony today, but for the leadership that you 
provide to really a truly professional organization. I think 
you are all a credit to police work and the level of 
professionalism, I think, is recognized everywhere.
    I may have said this before, but I think when I was first 
elected to Congress, I was reading one of the local newspapers. 
It quoted a Member of Congress. They asked him, he had left and 
gone home, they asked him what he missed most about Washington. 
He said the Capitol Police. I thought that was pretty high 
praise.
    I think all the Members certainly feel the same way. We 
feel very strongly and warmly about the Capitol Police and the 
service that they provide and the security that they provide 
for us and our families in times of crisis. Let me just on 
behalf of the subcommittee thank you for the service that your 
men and women provide us.
    Chief Abrecht. Thank you, sir.

                              FTE Increase

    Mr. Walsh. We will get to the security measures at the end 
of this period of the hearing. Let me just ask a few questions 
about the budget for staffing, and then I will hand it over to 
Mr. Serrano. Last year, the bill funded 1,255 FTEs. This year 
you are requesting just two additional, one for public 
relations, one for labor management. Can you explain why those 
two new positions are needed?
    Chief Abrecht. Absolutely, sir. We requested the one FTE to 
serve in the Public Information Office. Currently, the office 
is staffed by one sergeant, who is responsible for managing the 
entire public information and public relations effort for the 
department. At the direction of the Capitol Police Board, the 
department is undertaking a comprehensive crime prevention 
effort, which will address the safety and security needs of the 
House and Senate offices within the Capitol complex as well as 
State and district offices around the country. There is a 
significant need for----
    Mr. Walsh. That is handled by public relations?
    Chief Abrecht. Yes, in terms of providing information 
about----
    Mr. Livingood. We didn't have a place to put it. That is 
where we decided to put it.
    Chief Abrecht. We provide crime prevention information 
brochures. There is a significant need for the program, but it 
will greatly increase the load of the Public Information Office 
beyond the capability of just one person to handle it. So we 
envision getting him a civilian assistant who will help him 
prepare this information and material to be distributed.
    Mr. Walsh. What grade level would that be?
    Chief Abrecht. A relatively low-grade person. We would call 
it a clerk, I think it was graded as clerk 2 which is HS-5. The 
other position is a labor relations director. You remember the 
Congressional Accountability Act allowed our officers to 
unionize. They have done so. We are currently in the process of 
negotiating a labor contract. To do that, we are using an 
outside consultant at the present time and frankly dividing up 
all of the work of grievances and all of that among various 
people on the command staff. We need a professional, permanent 
labor management relations staff to deal with managing this new 
contract once we get it and handling all the grievances and all 
the work that is going to be generated by that.

                       Police Parity Pay Request

    Mr. Walsh. That seems a reasonable request, given that you 
haven't had to deal with an organized collective bargaining 
unit before. The budget also requests the parity items, 
$2,441,000. Do you know--maybe staff can help with this--does 
that require legislative authority? Before we can appropriate 
those funds for parity, does that require the House Oversight 
Committee to act on that change?
    Chief Abrecht. You will recall that last year in the 
budget, the committee established a process in the 
administrative provisions for setting the rates of pay for the 
Capitol Police, a unified pay scale which is set by the Capitol 
Police Board and is then subject to the review of the two 
committees of jurisdiction, the authorizing committees. If this 
initiative is funded, it would be our intention to, the Capitol 
Police Board's intention to modify those rates of basic pay and 
submit that to the committee, and it would be subject to the 
committee's approval.
    Mr. Walsh. So the appropriation would come first?
    Chief Abrecht. We would need the funding before we could 
even ask.
    Mr. Walsh. Do you have any plan to go to the oversight 
committees, the authorizing committees and ask for this 
authority?
    Chief Abrecht. There has been discussion already at the 
staff level and we do intend to proceed with that.
    Mr. Walsh. That would certainly help our position if you 
had that authority, then it would make it much easier and it 
actually would provide a little tension on us to do that, if it 
was authorized. What is the $269,000 base adjustment?
    Chief Abrecht. That is, I believe, essentially a misnomer. 
It is the annual step increases that everybody up to a certain 
period of time, until you reach 17 years as an officer, you get 
a step increase every year, assuming your service is 
satisfactory, of course, and I believe that is what that is.
    Mr. Walsh. I do have some other questions I will submit for 
the record?
    [Questions from Chariman Walsh and responses follow:]

    Question: The general expense budget is $5.3 million. The 
largest increases are $1,007,000 for computer services and $2.3 
million for capitol assets. What computer services are needed?
    Response: There are several issues surrounding the FY 99 
request for computer services. The first issue is that the USCP 
has been supported for computer services in the past by the 
Office of the Senate Sergeant at Arms. At the direction of the 
Senate Committee on Appropriations, the USCP has included this 
cost in its own budget for fiscal year 1999, while the Office 
of the Senate Sergeant at Arms has omitted this item from their 
own budget request.
    The FY 99 request for USCP computer services totals 
$1,007,000. Of this amount, 207,000 is for maintenance and 
service contracts currently in effect through the Office of the 
Senate Sergeant at Arms. The remaining $800,000 is for systems 
replacement in the USCP.
    The systems referred to include the Inventory Control 
System, Time and Attendance, Personnel Administration, Injury 
System, Congressional Employee Locator System, Report Writing 
System and the Expense Control System (accounting). The 
migration of the House and Senate payrolls to the NFC will be 
completed in March, 1998. In addition, meetings are currently 
on-going for a planned cross-servicing arrangement with the 
General Accounting Office for the accounting system. Timelines 
are being developed consistent with a planned effective date of 
October 1, 1998.
    The remaining systems are currently reside on an antiquated 
platform on the Senate Computer Center's mainframe computer 
which is no longer supported by the vendor. Further, these 
systems are not Year 2000 compliant, and due to their 
antiquated state, there are no plans to make them compliant. 
Even today, we are beginning to experience some problems in our 
applications which track leave categories and longevity dates. 
In summary, these systems are inadequate, are no longer 
supported by the vendor, are not Year 2000 compliant, and will 
not be supported by the Office of the Senate Sergeant at Arms 
in the future.
    The funds requested for the above systems replacement are 
to cover costs of developing specifications, vendor analyses, 
systems and applications development, testing, training, 
licensing fees, reporting systems, maintenance and systems 
integration. Finally, an interface will need to be developed to 
integrate data from the legacy systems to the new systems.
    Question: There is a study of police management and 
financial systems being conducted. Shouldn't we wait for that 
study before funding additional computer expenditures?
    Response: This management review is currently in the 
planning stages. Given the current state of our systems and the 
timing of the Year 2000 issue, there is a universal consensus 
that new systems will be required. Regardless of the specific 
recommendations of the management review, funding will be 
needed as soon as possible to resolve the current situation.
    Question: Explain the $2.3 million for capital assets. 
Specifically, what physical security equipment and systems need 
replaced?
    Response: Of the $2.3 million increase for capital assets, 
$1,663,000 is for a life-cycle replacement schedule for 
physical security equipment and systems. The no-year funding 
provided to date is dedicated to replacing existing systems 
that are failing and obsolete. The funding does not allow for 
the wholesale replacement of all security systems. 
Additionally, there is no funding identified for new security 
systems and equipment requests, or the upgrade of security 
systems on a periodic basis on projected equipment life-cycles.
    The request for fiscal year 1999 puts into place a process 
and annual budget to allow for the continued replacement of 
older equipment, to procure new systems for new requirements, 
and establish an orderly security equipment upgrade. It 
prevents the need for wholesale replacement of security systems 
through no-year funding by establishing a fully funded physical 
security program.
    Of the remaining $637,000, an increase in vehicle 
replacements is requested in the amount of $362,000. This 
amount will allow for the USCP to ``catch up'' with its 
original schedule of replacements. In the past two fiscal 
years, funds for this object class were necessarily diverted to 
cover the costs of protective services.
    Finally, $266,000 is requested to purchase weapons, 
training equipment, thermal imagers, night sights and 
miscellaneous equipment.
    Question: Give us a list for the subcommittee to review.
    Response: The list follows:
Item:
Replacement CCTV Monitors                                        $35,000
Replacement CCTV Cameras                                          50,000
Purchase SCIF Alarms Systems                                      60,000
Duress Alarms for Committee                                       63,000
Replacement Metal Detectors                                      100,000
Upgrade Members Duress Alarms                                    125,000
Preventative Maintenance Contract                                130,000
Card Access Systems Installations                                150,000
Intrusion Alarm Systems                                          250,000
Replacement X-ray Machines                                       700,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total, Physical Security Equipment and Services       $1,663,000

    Lastly congratulations on moving that payroll, combining 
it, moving it to the National Finance Center. On March 1 the 
Senate side will be on, too?
    Chief Abrecht. Yes, all set to go. We have not encountered 
any obstacles that we haven't been able to overcome.
    Mr. Walsh. Great. Thank you very much.
    Mr. Serrano.
    Mr. Serrano. Thank you very much. Thank you all for being 
here. Before I ask a couple of questions, let me echo the 
Chairman's words. It is really quite a job you guys do, all 
your men and women. It is good to feel that you are safe. I 
wish you would just ask them not to stand up at attention when 
I walk into the building.
    Chief Abrecht. I am glad to hear they are doing so, sir.
    Mr. Serrano. I always wonder if they see someone behind me 
that they are reacting to, but I think it is for me.
    Chief Abrecht. It is supposed to be for everybody, not just 
you.

                status of labor/management negotiations

    Mr. Serrano. How is the issue, you already touched on it, 
but the issue of unionizing the force coming along? I see there 
was an article in The Hill that referred to some comments that 
you supposedly made, Chief, having come from a unionized 
background, where you say you were opposed to unionizing the 
Capitol Police. I just want to know what was the reason behind 
that.
    Chief Abrecht. We tried so hard to convince The Hill that 
that was not, in fact, the case and that I never said that. It 
was just one of those ongoing, we all love journalists, I 
guess. I have never had any opposition there. It is a fairly 
complicated issue. It is now past because the Office of 
Compliance has ruled on it. There was a provision in the 
Accountability Act for a determination to be made whether the 
Capitol Police was a national security organization exempt from 
unionization.
    We did take the position that this was a national security 
organization. We continue to feel that it is, that protection 
of the first branch of government is a national security 
function. And so we did, indeed, ask to be exempted simply 
because we felt that was our responsibility as the managers of 
the enterprise to bring forth that position. Once the Office of 
Compliance ruled that only parts of the department were 
excluded and they did, indeed, exclude fairly substantial parts 
of the department.
    Our Dignitary Protection Division, our technical security 
people were excluded and a number of other groups were excluded 
on national security grounds. Once that decision was made, we 
have moved forward in a good faith fashion. I meet regularly 
with the Executive Vice President of the Union and the ground 
rule negotiations are about complete. We expect to negotiate in 
a fully cooperative mode and have been doing so so far. I don't 
believe if you asked the union they would say that we are not 
being cooperative in every way.
    Mr. Serrano. Obviously, you don't have to do too much work 
here on this committee to convince us. We get quoted in the 
same sense. Trust me, you are on safe grounds here with this 
group, which brings me to a question. On one hand, I am very 
much for unions across the Nation, but on the other hand I 
certainly wouldn't want a walkout during a major crisis. I 
guess that has been dealt with.
    Chief Abrecht. They are under the Federal Labor Relations 
Act and no strike is permitted.
    Mr. Serrano. There have been some concerns, Chief, if not 
public, then private among some people, as to the makeup of the 
force, the involvement of women in the force, the involvement 
of ethnic minorities and racial minorities in the force. What 
can you tell us about that issue?
    Chief Abrecht. The force is relatively well representative 
of most minorities. It is about 30 percent African-American, 
which is a little bit more than the statistical standard for 
the Washington metropolitan area. Women are doing extremely 
well. We do have some trouble recruiting women. We don't get as 
many women as we would like to have. But it is certainly not 
for lack of effort.
    The good news for women is that they are doing very well 
once they get on the department. They tend to get promoted at a 
higher rate than men do. I don't believe that we are having a 
major problem.
    One of the problems we face is recruiting Hispanics, which 
is a problem very common to law enforcement, to the point that 
a sort of sheep stealing that goes on among police departments, 
where they take Hispanic officers from each other because all 
police departments in the Washington metropolitan area, at 
least the ones I am familiar with, have real difficulty 
recruiting Hispanic officers. That is probably the area where 
we have, in terms of ethnic minority, that is the area we have 
the greatest difficulty.
    Mr. Serrano. How does the pay and benefit package compare 
to area local law enforcement agencies?
    Chief Abrecht. On base pay, the clean base pay, we are in 
fairly good shape. We are right about the same as the Uniformed 
Division of the Secret Service, which is one of the agencies we 
compared ourselves with; and the Park Police. The Metropolitan 
Police Department, we are a little bit ahead of, about the 
same. We are sort of in the middle of the pack in terms of all 
the major law enforcement agencies in the area.
    You heard me mention earlier where we fall behind is things 
like on the shift differential, the holiday pay and Sunday 
premium pay, which we do not have parity on. One other area 
when you become very senior, many of the agencies around here, 
if you have got more than 15 years on, you are doing a little 
better than our people. But for the bulk of our force, the base 
pay is fairly even. Because of differential, the total 
compensation does fall behind for many of the officers.
    Mr. Serrano. I have no further questions right now. I will 
wait for the other part. Well, just one other question. Whose 
department was it that put that button, I guess I am allowed to 
mention the button, in my office?
    Chief Abrecht. That would be our Physical Security 
Division.
    Mr. Livingood. Your Capitol Police.
    Chief Abrecht. That is us.
    Mr. Serrano. Did my staff, while I was not there, decide 
where it should be, because it is behind me? You want to see 
me? Hold on a second.
    Mr. Livingood. We will fix it tomorrow. We will take care 
of the problem. It will be changed tomorrow.
    Mr. Casey. You want them to send the firing range crew up 
there as well?
    Chief Abrecht. It was probably someone on your staff. We 
will get it corrected.
    Mr. Serrano. Thank you.
    Mr. Walsh. Mr. Cunningham.
    Mr. Cunningham. I would just like to add a thanks. I know 
when I talk to law enforcement all around the country, I tell 
them they have to model themselves after three different 
forces; one, the San Diego police department, the San Diego 
County sheriff's department and the Capitol Police.
    Chief Abrecht. Thank you, sir.
    Mr. Cunningham. The professionalism, even the camaraderie, 
professionally, is first rate. You have to bend these guys to 
make them call you by your first name. They won't do it then 
probably unless they are off duty. The guys do a fantastic job. 
I appreciate it.
    Chief Abrecht. Thank you, sir.
    Mr. Cunningham. I want to know how many Irishmen are on 
your force.
    Chief Abrecht. Quite a number. Quite frankly, I don't keep 
statistics on it.
    Mr. Cunningham. As a matter of fact, Vito Fossella from New 
York was elected. His wife is named Mary Pat. She's Irish, and 
I got them an Irish flag for their kid, their new kid, to break 
it in.
    I have got no real questions other than to thank you for 
the service that you offer to us.
    Mr. Walsh. Mr. Latham.
    Mr. Latham. First of all, I want to associate myself with 
your remarks in your opening, Mr. Chairman, and congratulate 
you on a great force.
    Chief Abrecht. Thank you, sir.

                      request for general expenses

    Mr. Latham. I see in the request, general expenses at 
$8,361,000, which represented an increase of $5,262,000.
    Mr. Walsh. Excuse me. I didn't recognize Mr. Wamp. I did 
not realize that Mr. Wamp was still at the table. I apologize.
    Mr. Latham. You are next.
    It says the increasing focus on the ability of the 
department to respond to threats, keep pace with technological 
advances and ensure that personnel receive adequate training. 
What additional threats? This is a tremendous increase 
obviously in that general account. What are you talking about 
specifically?
    Chief Abrecht. This is really in three areas. The bulk of 
it is the computer systems which we talked about a little 
earlier which is one of these issues where it is currently in 
the Senate or at one time was in the Senate, was the sole 
provider of computer and radio services for the department.
    Mr. Latham. How much is that?
    Chief Abrecht. It is $2 million, if I remember. Roughly, 
1.4.
    Mr. Latham. What is it?
    Mr. Livingood. $1.4 million.
    Chief Abrecht. The physical security systems is a large 
block of it. Putting the physical security systems on a life-
cycle replacement basis. That is all of the alarm systems. I 
talked about that.
    Mr. Latham. Metal detectors?
    Chief Abrecht. Metal detectors, X-ray machines, CCTV 
cameras, all of the buttons in the offices.
    Mr. Latham. I don't think I have a button. You have got one 
in the back, but I don't think I have a button.
    Chief Abrecht. We can take care of that as well. Every 
office will have multiple buttons.
    Mr. Latham. Or my staff hasn't told me where it is.
    Chief Abrecht. They are still being installed.
    Mr. Latham. The Republicans have them in front.
    Chief Abrecht. That is another very large chunk, $1.6 
million of it. We have asked for a substantial increase in our 
protective travel budget to meet actual experience. We have 
always hoped that the amount of that that is required would go 
down. It doesn't seem to. So we have had to reprogram other 
money to do that, as I mentioned, which is why our fleet is in 
bad shape. So we have asked for a substantial increase there to 
actually bring it up to what ithas actually been costing us. I 
mentioned the vehicle replacement. That is about $300,000 for all of 
our vehicle replacements. That is the bulk of it. I can go into greater 
detail.
    Mr. Latham. I notice there is another couple of million. 
Are there additional threats that we haven't anticipated before 
that you are trying to prepare for?
    Chief Abrecht. The chemical and biological warfare or 
terrorism issue scares us to death. The ability to cause mass 
mayhem through that vehicle in a situation like this where the 
building is wide open, where people can come in is just very 
hard to prepare for. We are doing quite a lot in that regard, 
but there are no really good answers to it. We are doing what 
we can to make it--to prepare--to detect and mitigate that kind 
of a situation.
    Mr. Latham. That is a problem that we have in a free 
society. The only way to prepare yourself or to totally 
eliminate it is to shut the place down and I don't think that 
is an option here.
    That is all the questions I have, Mr. Chairman.
    Mr. Walsh. Thank you, Tom. Mr. Wamp.
    Mr. Wamp. One short follow-up to that, because that is my 
major concern as well. You talked about the preparations that 
were made before last week's State of the Union address. Had 
that level of preparation taken place in a previous State of 
the Union address?
    Chief Abrecht. No, we were only about halfway as prepared.
    Mr. Wamp. The shower tents and all that, that is the first 
time we had done that?
    Chief Abrecht. That was the first time we had it fully set 
up.
    Mr. Wamp. I know some of this may come up later, but 
whatever we can talk about now, do you think that the Members 
of the House and the Senate themselves have had enough 
preparation, training or discussion about what they should do? 
If not, I want to speak as a Member, that needs to be done as 
soon as possible, Mr. Livingood.
    Mr. Livingood. Some of that I think I would like to discuss 
in the closed hearing. I would not like to discuss that on the 
record, if I may, Mr. Chairman. We would be happy to answer 
that.
    Mr. Walsh. Is that all your questions?
    Mr. Wamp. I will yield back until that time.
    Mr. Walsh. Unless there are any other questions, let me 
just make a point. Mr. Serrano asked some questions about the 
diversity of the organization. Obviously, you are attaining 
high goals, doing your best to include the entire society.
    The next time you come, perhaps who you bring with you 
could be more reflective of the overall police force. It might 
help your case, too.
    [A question from Chairman Walsh and response follow:]

    Question: For the record, please supply all reprogramming 
requests made last year and the disposition of each by the 
appropriations Committees.
    Response: The information follows.

[Pages 630 - 633--The official Committee record contains additional material here.]


    With that, I had some verbiage here that I can read. We 
will now take up the perimeter security plan. By order of the 
committee, we will now go into executive session.
    Mr. Wamp. Mr. Chairman, just looking at the Speaker 
speaking, it may be a good time----
    Mr. Walsh. Maybe he is wrapping up?
    Mr. Wamp. He may be wrapping up, closing debate on this 
bill. In case you want to take a break and come back.
    Mr. Serrano. I can read lips. He is announcing your 
ascension to chairing the Ways and Means Committee.
    Mr. Walsh. In either case, maybe we should wait a minute.
    Mr. Serrano. He just said ``Zack.''
    Mr. Wamp. It looks to me like we are fixing to vote.
    Mr. Walsh. We have been advised by staff that there will be 
a vote fairly soon on an amendment that the Speaker is speaking 
on. Then there will be a vote on final passage right after 
that. Why don't we go ahead and clear the room and begin and 
then we will just come back after the vote is called.
    Only members and staff and Capitol Police Board and Capitol 
Police personnel may remain in the room. The clerk will clear 
the room. At this time I would ask anyone who is not in that 
description I just provided to leave the room.
    [Where upon the Committee convened in executive session to 
conclude the hearing.]
                                        Thursday, February 5, 1998.

                      CONGRESSIONAL BUDGET OFFICE

                               WITNESSES

JUNE E. O'NEILL, DIRECTOR
JAMES L. BLUM, DEPUTY DIRECTOR
GAIL DEL BALZO, GENERAL COUNSEL
POLLY E. HODGES, BUDGET AND FINANCE OFFICER
DAVID M. DELQUADRO, PERSONNEL OFFICER
MARK G. DESAUTELS, ASSISTANT FOR PUBLIC INFORMATION
DANIEL F. ZIMMERMAN, CHIEF, INFORMATION RESOURCE MANAGEMENT UNIT
    Mr. Walsh. The subcommittee will come to order.
    It is 10:00 a.m. We have an abbreviated schedule today, so 
we would ask all the witnesses and all the Members to be as 
concise as possible so that we can get everything covered, and 
we have a lot to cover.
    We will now take up the 1999 budget request of the 
Congressional Budget Office. We have Dr. June O'Neill, the CBO 
director. Dr. O'Neill, welcome. Dr. O'Neill was appointed as 
the fourth director on March 1st, 1995. We also have Mr. James 
Blum, deputy director. We welcome you both.
    Before we proceed, let me indicate the budget request. CBO 
is requesting $25.9 million for fiscal year 1999. No staffing 
increases are requested. Dr. O'Neill, I would like to have you 
proceed. If you would like to introduce your staff at this 
time, please feel free, and continue with your statement.
    Ms. O'Neill. Yes, Mr. Chairman. It is a pleasure for us to 
be here today.
    I would like to introduce the staff. Starting at this end 
is our general counsel, Gail Del Balzo; Mark Desautels, who 
handles information requests from the press; Dan Zimmerman, who 
heads our computer services unit; Polly Hodges, who is our 
budget chief; and Dave Delquadro, who is our personnel 
director.
    Mr. Walsh. Welcome to you all.
    Ms. O'Neill. I will try to be brief in summarizing our 
request and submit my formal statement for the record.
    Mr. Walsh. Without objection.
    Ms. O'Neill. I also have with me copies of a report that 
the Congressional Budget Office (CBO), released today, which 
details CBO's activities in 1997, as well as copies of our 
recently released annual report on the budget and the economy.

                            new cbo products

    I would like to point out a couple of significant additions 
that we have made this year in our repertoire of products, with 
which we try to keep the public informed about what is 
happening with the budget. One of those additions is the 
launching of CBO's Web site in September. We are making all of 
our work products available on the Web; that includes 
testimonies and cost estimates in addition to our standard 
reports and products such as that.
    I would also like to point out that we are now putting out 
a monthly budget review. With that budget review, we hope to 
keep the Congress and the public abreast of what is happening 
from month to month with respect to the current fiscal year. 
Although projecting in advance what will happen in the current 
fiscal year has not proved to be easy--and certainly our 1997 
estimate was off the mark, as was everyone else's--with the 
monthly report we can keep the public informed about whatis 
happening so that there will not be any surprises. The monthly budget 
review will also be on our Web site.

                          cbo's budget request

    Our budget request for fiscal year 1999 is, as you said, 
$25,938,000, and that amount allows for an increase of 4.6 
percent, or $1.1 million, over our fiscal year 1998 
appropriation. Personnel costs, which account for 85 percent of 
the total CBO budget, are driving our request. Nearly 96 
percent of the $1,466,000 in cost increases facing CBO in 
fiscal year 1999 are increases associated with pay and 
benefits. CBO has reduced other parts of its budget to absorb 
more than 20 percent of the increases; that was done primarily 
by cutting spending for automated data processing (ADP) 
equipment by $305,000--about a 13 percent cut.

             concerns about staff recruitment and retention

    Our requested funds are for a staff ceiling of 232 full-
time-equivalent positions, and we are not asking for any 
additional positions. Although CBO should be able to maintain 
its current workload with the funds requested here, the agency 
confronts several uncertainties in fiscal year 1999. Principal 
among our concerns is our ability to offer the salaries and 
benefits needed to remain competitive in today's tight labor 
market. The current job market compels CBO and other employers 
to worry about both the recruitment of new workers and the 
retention of current employees. CBO's staff, includes 
economists and other quantitatively skilled professionals, all 
of whom are in particularly high demand. Newly minted 
economists now command, we have found, surprisingly high 
salaries. Recruitment has become a time-consuming and 
frequently frustrating process, as more and more often we lose 
qualified people to employers who can sometimes pay as much as 
50 percent more in compensation.
    The difficulty of attracting new staff has added to 
pressure to retain our experienced workers, which is one reason 
CBO's merit pay request for fiscal year 1999 is so critical. 
Another factor is CBO's reputation for high-quality analysis 
and budget work, which has made our experienced analysts very 
interesting to other employers. In the past few months, for 
example, CBO has lost three of its managers to more senior and 
higher-paying positions.
    We are not suggesting that because of our turnover rates we 
deserve extraordinary consideration. However, we operate under 
something of a disadvantage, compared with other Federal 
employers that can provide locality pay raises and give lump-
sum bonuses to attract and retain exceptional workers. To 
remain competitive, we believe we need the budget we have 
requested.

               upcoming costs for relocating adp systems

    A further concern for CBO is the uncertain costs associated 
with the relocation of important ADP systems. Currently, CBO 
relies on the mainframe computer of House Information 
Resources, or HIR, to run our budget database applications. 
However, the HIR mainframe is slated to be retired, and CBO, 
along with other users, will have to make other arrangements.
    HIR and its mainframe computer have provided excellent 
service, and CBO's challenge is to duplicate, as closely as 
possible with the new vendor, the services it currently 
receives from HIR. We do not yet have a firm estimate of how 
much it will cost to evaluate our options for moving CBO's 
systems or to prepare for the transition. Both types of costs 
are likely to occur in fiscal year 1999. Our request includes 
$100,000 for those purposes, although that could prove to be a 
conservative estimate.

                        a prudent budget request

    In conclusion, Mr. Chairman, CBO is keenly aware of the 
Congress's intention to balance the budget and downsize the 
Federal Government, including the legislative branch. In 
response, CBO's recent budget requests have been quite modest, 
with requested increases usually less than the projected rate 
of inflation. Our present proposal represents our best estimate 
of the amount necessary to maintain our budget at the current-
services level. It is a prudent budget, we believe, in which we 
absorb over 20 percent of our mandatory pay and benefit 
increases through reductions elsewhere. However, I think that 
our requested increase of 4.6 percent is necessary if we are to 
continue to serve the Congress in the manner it has come to 
expect.
    Thank you.
    Mr. Walsh. Thank you very much for your testimony.
    [The information follows:]

[Pages 638 - 655--The official Committee record contains additional material here.]


    Mr. Walsh. We do note the budget, $25.9 million, the 
request for an increase, 4.6 percent, is $1.1 million. The pay 
and price level increases are projected at $1.5 million, so we 
recognize that you have found some savings within your own 
department to pay for those, most notably in administrative 
data processing and that is to be commended. We appreciate that 
effort. That is an effort we don't have to make now, and you 
practice what you preach, which is nice to see.
    Just sort of a curiosity. We note you did a study on 
marriage in 1997. Are you now involving yourself in social 
issues?

                the income tax system's marriage penalty

    Ms. O'Neill. That study was about the marriage penalty, and 
actually marriage bonuses as well, because the individual 
income tax system generates both. It is a complicated issue. In 
an income tax system like ours with progressive rates, it is 
difficult--in fact, it is impossible--to levy the same tax on 
couples with the same income and at the same time eliminate any 
effect of marriage on a couple's tax liability.
    The history of tax legislation shows a tension: we have 
gone back and forth with larger and smaller marriage penalties. 
Recently the problem has grown more conspicuous with the 
increase in the number of two-earner couples, because the 
closer together the two spouses' earnings are to each other, 
the larger the marriage penalty. On the other hand, a one-
earner couple will most likely get a marriage bonus, so there 
is also political tension.
    Mr. Walsh. Anything we can do to alleviate tension within 
marriages, we should try to do that. Speaking with 23 years of 
experience, one less tension in a marriage would be 
appreciated.
    I really don't have any in-depth questions on the budget, 
but I do want to satisfy my own curiosity as I did on that one. 
This issue of Asia and the financial crisis in Asia, and its 
impact on our economy, and the revenue estimates that we have 
been presented within the budget, balanced budget agreement, do 
you anticipate that what is happening in Asia and the slowdown 
in their growth and its impact on the slowdown on our growth of 
GDP and exports, do you think it will affect those revenue 
estimates this year and next and the next? Have you factored 
that in?

        how the asian financial crisis affected cbo projections

    Ms. O'Neill. We have factored in the effect that we believe 
will occur as a result of the Asian crisis, although that 
calculation was done in the face of considerable uncertainty. 
We anticipated that growth would be lowered by about half a 
percentage point as a consequence of the currency problems in 
Asia. Since we put our latest forecasts to bed, the situation 
in Asia has been very fluid. At first, it seemed to get worse; 
now, it seems to have stabilized, so I do not see any reason 
for us to doubt what we initially projected. But there is a lot 
of uncertainty here because something could trigger a 
contagious effect--an Asian flu situation, one might say--in 
which confidence is shaken in countries like Brazil and 
elsewhere around the world.
    Mr. Walsh. So does it affect the assumptions that were made 
in the long-term balanced budget agreement? Will you have to--
--

                 changes in cbo's baseline assumptions

    Ms. O'Neill. A direct answer is that the assumptions we had 
in the balanced budget agreement have changed, although the 
Asian financial crisis was not a major factor in that change. 
In actuality, the shift in our assumptions was in the other 
direction, largely because 1997 turned out to be so much better 
than we had thought. We underestimated revenues for 1997 by $72 
million; the Office of Management and Budget underestimated 
them by $75 million.
    Mr. Walsh. But there is no tension there.
    Ms. O'Neill. Everybody was wrong together, including the 
private forecasters.
    Mr. Walsh. We like you to be wrong that way, rather than 
conservative estimates.
    Ms. O'Neill. That is exactly what happened. Moreover, along 
with the revenue change in 1997 was an improvement in the 
economic outlook. So although Asia was a question mark, it was 
not enough to make our projections more negative on balance 
because everything else was more optimistic. In fact, before we 
knew about the Asian crisis, we had anticipated that there 
would be some slowdown generated by the Federal Reserve because 
of the rapid economic growth and the beginning of escalating 
inflation.
    [Questions from Chairman Walsh and responses follow:]

    Question. Why does the CBO need a ``collections 
management'' system? That sounds like something the Library of 
Congress would use.
    Answer. This new, integrated library software will be used 
for the acquisition, cataloging, circulation, serials 
management, and inventory control of the publications that CBO 
needs to support its analytical work. It is the type of system 
all libraries use to manage their collection, whatever size or 
type.
    Question. We should take advantage of other agency 
capabilities when possible. Did you ask the Library if they 
could help you out with such a system?
    Answer. CBO has contacted other legislative branch 
libraries including those at the Congressional Research 
Service, GAO, the House, and the Senate. We have also discussed 
available systems, and their experiences using them, with 
executive branch and judiciary branch libraries.
    Question. Where did you find the funds to allocate to the 
ADP project? Include a table showing the details of these funds 
movements.
    Answer. The estimated reprogramming cost of $340,000 would 
be paid for through lower agency retirement contributions 
(about $100,000) and lower personnel costs resulting from 
turnover in senior management positions.
    The $100,000 savings in fiscal year 1998 retirement 
contributions derives from a 1.5 percentage-point reduction in 
agency contributions for employees covered under the Federal 
Employees' Retirement System (FERS) offset by a 1.51 
percentage-point increase in contributions for employees 
covered by the Civil Service Retirement System (CSRS).
    The remaining cost savings ($240,000) would be temporary. 
They would be derived from lower fiscal year 1998 salary and 
related expenditures as CBO seeks to hire several managers. We 
are also actively recruiting for newly minted economists at the 
master's and Ph.D. levels. But some positions--such as those at 
a more senior level requiring individuals with specific work 
experience--will probably not be filled until after the senior 
managers are replaced.

   Congressional Budget Office--Proposed Transfer of Funds in FY 1998   
------------------------------------------------------------------------
                                                                  Amount
                          Object Class                            (000's
                                                                    $)  
------------------------------------------------------------------------
11 Personnel Compensation.......................................   (236)
12 Personnel Benefits...........................................   (104)
31 Equipment....................................................     340
                                                                 -------
    Net Change..................................................       0
------------------------------------------------------------------------

    Mr. Walsh. Thank you very much. Mr. Serrano.
    Mr. Serrano. Mr. Chairman--thank you for joining us today. 
I have some questions I would like to submit for the record.
    Mr. Walsh. Without objection.
    Mr. Serrano. The CBO is one of those agencies we deal with 
all year long, and, unlike other agencies that come before us 
once a year and we ask them a million questions, this is not 
something that we have to do. My main question was also on the 
Asian crisis, so I will submit these for the record and ask you 
very briefly to comment.
    In your statement, you refer to facing relocation of 
important data processing systems, at an unknown cost, as 
H.I.R. moves to eliminate its mainframe computer by 2000, and I 
would like to know how you are setting that up.
    Ms. O'Neill. Jim, would you like to answer that?

             THE SEARCH FOR A NEW MAINFRAME SERVICES VENDOR

    Mr. Blum. The mainframe computer that House Information 
Resources operates, and whose services we buy, holds our main 
budget database. A decision has been made to retire the 
mainframe because the number of applications--particularly 
those used by the House--is too small to justify having a large 
mainframe. The decision has been made to migrate those House 
systems, such as the legislative information system, to another 
place. We are hoping that CBO's work can just go along with 
that migration, but there is considerable uncertainty about the 
exact timing of the move, what vendor will be providing the 
mainframe services, and what the move will cost us. A possible 
vendor, for example, might be the Government Printing Office, 
which has apparently expressed some interest in this matter.
    Mr. Serrano. Okay. I just am hopeful, also, as you are, 
that it is a smooth transition, and I am hoping that other 
people get involved in making sure it is a smooth transition.
    I can tell you just at my Rayburn office level, every time 
we have one change, any change, for the better supposedly, in 
our system, it seems like 15 things we did in the last year 
sort of disappear from our system and we have to re-invent 
them. And we can survive that, but----
    Mr. Blum. That would be a bigger problem for us, obviously.
    [Questions from Mr. Serrano and responses follow:]
    Question. CBO has been criticized for ``missing'' the 
increase in revenues that has been driven by the strong 
economy. How do you respond to that criticism?
    Answer. CBO and the Administration both underestimated 
revenues last year. We missed three factors that all worked to 
make revenues grow faster than expected, and each contributed 
about one-third of the unexpected revenues. First, wages and 
profits grew faster than forecast. Second, capital gains 
realizations grew by 45 percent between 1995 and 1996--much 
faster than expected. Third, incomes were taxed at higher rates 
than expected because incomes of high-income taxpayers, whose 
rates are higher than average, grew faster than the incomes of 
other taxpayers. Because all of these factors are uncertain, 
our forecasts are subject to error, but we hope that in most 
years, errors in one aspect of the forecast will offset errors 
in the others.
    We have made every effort to learn from last year's 
estimating mistakes, yet it seems inevitable, given the perils 
of projecting, that large errors will occur from time to time. 
However, we are taking steps to provide an early-warning 
mechanism that will signal when actual receipts and outlays are 
deviating from our estimates for the current fiscal year. In 
that regard, we are making public our analysis of the Daily and 
Monthly Treasury Statements, which appears in our Monthly 
Budget Review report.
    Question. You urge caution about the long-term outlook for 
the federal budget and name the ``Asian crisis'' as one 
potential factor. Please discuss CBO's views on the range of 
impact on the U.S. economy and the federal budget of the 
``Asian crisis''.
    Answer. There is a great deal of uncertainty about the 
Asian crisis, but the consensus estimate of its effect on the 
U.S. economy is that it will slow growth by about one-half of 
one percentage point for the next two years, dampen inflation, 
worsen profits, and lower U.S. interest rates slightly below 
what they otherwise would have been. Some estimates of the 
effect on U.S. growth have been as high as 1 percentage point. 
Given the recent stabilization of most of the countries 
involved in the crisis, virtually no analysts believe that the 
effect is likely to be larger than that.
    The federal budget will be affected by the Asian crisis. In 
its baseline, CBO built in an effect on growth of one-half of 
one percentage point. If, in fact, growth is reduced by a full 
percentage point but all other aspects of the economic forecast 
are accurate, then the deficit will be greater by about $5 
billion in 1998 and $15 billion in 1999. Conversely, if the 
crisis turns out to have a minimal effect on growth, deficits 
for 1998 and 1999 will be smaller by the same amounts. The 
effects of the Asian crisis on inflation, interest rates, and 
profits could also be different from what CBO has assumed. Such 
changes might cause the deficit to differ from the CBO baseline 
by more or less than the effects on growth alone would 
indicate.
    The slower growth occurs because the slower pace of economic 
activity in Asia and the higher value of the U.S. dollar will reduce 
demand for U.S.-produced goods and make foreign goods more competitive. 
Those effects will slow the growth of U.S. export industries and 
import-competing industries, and the trade deficit will increase over 
the next two years. Investment in the United States will be supported 
by financial inflows from abroad and subsequent lower interest rates, 
but the negative effect on the trade balance is likely to be much 
larger than the positive effect on investment.
    Inflation will be held down by the fall in the prices of imported 
goods. Import prices in general have been falling for over a year, and 
the Asian crisis will cause further declines in 1998.
    Profits have already been adversely affected, with some banks 
reporting lower profits for the fourth quarter of 1997 because of the 
Asian crisis. Although the Asian crisis accounts for only part of the 
slowing, profit growth this year is expected to slow to about 3 
percent, compared with 9 percent in 1997.
    The prospect of reduced Asian demand and lower import prices has 
dampened U.S. interest rates slightly. Before the Asian crisis 
developed, it was generally thought that the Federal Reserve would have 
to raise rates in order to slow growth, which at 3.8 percent for 1997 
threatened to cause higher inflation, given the high rate of resource 
use in the United States. The Asian crisis has reduced the likelihood 
of monetary tightening, and interest rates have eased.
    Question. The retirement of the baby boom generation is another 
cause for caution on the long-term budget outlook. What range of 
options does CBO recommend to Congress on Social Security and Medicare?
    Answer. A chapter in CBO's March 1997 report, Long-Term Budgetary 
Pressures and Policy Options, examined a wide range of long-term 
approaches that would reduce the growth in spending on Social Security 
and Medicare. CBO will publish a revision of that report in the next 
few months.
            Social Security
    To prevent Social Security spending from growing faster than the 
economy when the baby-boom generation retires, policy makers would have 
to substantially curtail the commitments made under current law. CBO's 
report examined three main ways of doing that. First, the initial 
benefits of future Social Security recipients could be reduced below 
the levels that current law would provide. Across-the-board cuts in 
initial benefits that were announced well before they took effect could 
produce substantial savings while still preserving the basic benefit 
structure of the Social Security system. In principle, workers could 
offset the cut in their future Social Security benefits by either 
working longer or saving more. However, some people would not be able 
to make the necessary adjustments and could therefore have much lower 
income when they stopped working.
    Second, the age at which a worker would become eligible for full 
retirement benefits--the ``normal retirement age''--could be raised to 
reflect increases in life expectancy. Under legislation enacted in 
1983, the normal retirement age is already scheduled to increase from 
65 to 67. Some proposals would speed up the transition to age 67 and 
then further increase the age to keep up with future gains in life 
expectancy. Raising the age at which a worker would become eligible for 
full benefits is, for most purposes, equivalent to cutting initial 
benefits, with similar advantages and disadvantages.
    Third, future annual cost-of-living adjustments (COLAs) could be 
reduced. Current law indexes the basic Social Security benefit by the 
increase in the consumer price index (CPI), beginning when a worker 
becomes eligible for benefits. Many analysts feel that the CPI 
overstates increases in the cost of living, although the magnitude of 
the overstatement and what should be done about it are subject to much 
debate. Unlike across-the board reductions in benefits and increases in 
the normal retirement age, substantial changes in COLAs would 
eventually reduce benefits the most for the oldest beneficiaries and 
for those who initially became eligible for Social Security on the 
basis of disability.
            Medicare
    Three fundamental approaches can be used to slow the growth in 
federal Medicare spending. The Congress could reduce the number of 
people eligible for benefits, collect more of the costs from 
beneficiaries, or restructure Medicare to reduce total health care 
costs per beneficiary.
    One way to reduce the number of people eligible for benefits would 
be to increase the age of eligibility. That approach would reduce 
federal spending for Medicare compared with current law, but spending 
would continue to grow as a percentage of GDP. Further, that approach 
would do little to reduce total health care costs, and it would 
lengthen the period of time during which people who opted for early 
retirement under Social Security might have difficulty getting private 
insurance coverage.
    Under the second approach, premiums collected from beneficiaries 
could be increased to cover a larger share of Medicare's total costs 
for both Part A and B. Premiums paid by enrollees cover only about 10 
percent of costs now. This option could keep net Medicare spending as a 
share of GDP from rising, but that result would be accomplished by 
shifting costs to beneficiaries rather than by constraining the growth 
in total health care costs. Without any changes to improve the 
efficiency of the Medicare program, premiums would consume an ever-
larger share of an enrollee's income.
    A third approach to slow the growth of federal spending for 
Medicare would be to restructure the program, giving patients and 
providers greater incentives to make cost-effective choices. One way to 
do that would be to set up a system of competing health care plans and 
limit growth in the amount Medicare would contribute toward the 
premiums charged by the various plans. In such a restructured system, 
Medicare's fee-for-service sector could be just one of a number of 
plans competing for enrollees on the same basis as all other plans. 
Because enrollees would be responsible for any excess premium amounts 
and would receive rebates for plans costing less than Medicare's 
contribution, they would have financial incentives to be prudent 
purchasers of health plans. Also, because plans would be at risk for 
any costs above their predetermined premium collections, they would 
have financial incentives to operate efficiently. Control of federal 
Medicare spending would be ensured because the financial risks from 
higher growth in health care costs would be shifted to health plans and 
enrollees. Although the federal subsidy per enrollee would be smaller 
than it would be under current law, competition among plans and 
providers might spur efficiency and increase real health benefits for 
each dollar spent.
    However, the effects of the last approach on total costs for a 
basic benefit package--and therefore on the costs that beneficiaries 
would bear--are uncertain. If the incentives established to encourage 
more cost-conscious behavior (and so reduce annual growth in the cost 
per enrollee) were not sufficient to match the annual growth in the 
federal defined contribution, premiums for enrollees would steadily 
increase. In practice, the effects would probably differ among various 
enrollee groups. Some basic plans would probably keep their costs low 
enough to avoid having to charge supplemental premiums. However, the 
access to providers and quality of services available in those plans 
might limit their appeal primarily to low-income enrollees. Higher-
income enrollees might gravitate instead to plans that charged 
supplemental premiums and provided better access and quality.

    Mr. Serrano. Thank you.
    Mr. Walsh. Thank you, Mr. Serrano. Mr. Fazio.
    Mr. Fazio. Good morning.
    First of all, good to see you all. I appreciate the 
continuity I see in the top ranks of the CBO, which are people 
like Jim. How many different directors have you worked with?
    Mr. Blum. June is the fourth.
    Mr. Fazio. From the beginning?
    Mr. Blum. From the beginning.
    Mr. Fazio. The fact you are still here is an incredible 
testament.
    Mr. Blum. I don't know how to read that. Maybe I couldn't 
find a better job elsewhere.
    Mr. Fazio. You have been acting out a lot and we appreciate 
the continuity you have helped provide.
    Let me ask about your Web site. I hear from my staff, and I 
would like to take credit, but I can't, it is a great resource, 
and that it is particularly helpful. I assume it is also to 
people outside the institution who are using it.

                           cbo's new web site

    Ms. O'Neill. We have had 100,000 visitors to the site since 
September, I believe.
    Mr. Fazio. Do we know who the people are?
    Mr. Blum. I think they are from all over.
    Mr. Fazio. The financial community?
    Mr. Blum. Yes, from the financial community in New York 
City and from universities. We also have a number of people 
from overseas who are dialing up the site because it is 
available internationally as well. It turns out to be a very 
efficient way of transmitting our publications and making them 
available to all interested parties.
    Mr. Fazio. Do you have any other plans for further 
development of it? I see people in the second row are shaking 
their heads. Maybe we can hear directly to what some of those 
things are.

                    cbo's cost estimates on the web

    Mr. Blum. We are putting all of our bill cost estimates on 
the site, and, as I am sure you realize, over the course of the 
year that is a very large number, ranging from perhaps 500 to 
700 estimates.
    As a result, we are working to design a means whereby a 
person can easily access the particular cost estimate for the 
piece of legislation of interest. That change will require some 
additional work.

             using internet technologies for administration

    We are also interested in applying the Internet technology 
to our own administrative operations, which could provide us 
with some internal efficiencies. Processing forms 
electronically rather than on paper, for example, could make 
things more efficient and speed up our internal administrative 
procedures.
    Mr. Fazio. Is that directly linked to even quicker analysis 
cost, something that all of us wait breathlessly for?
    Mr. Blum. The computer certainly has, over the years, 
enabled us to do much quicker estimates.
    Mr. Fazio. Boilerplate.
    Mr. Blum. Exactly. We have been able to turn around cost 
estimates with increasing speed over the years, so the computer 
technology has given a great boost to our productivity.
    Mr. Fazio. And you will have even more.
    Mr. Blum. Even more, yes.

          increased ``transparency'' for cbo's cost estimates

    Ms. O'Neill. We have also been trying to provide as much 
information as possible about the way we do our estimates so 
that it does not appear as though there is some sort of 
mystery.
    Mr. Fazio. It floats up out of the ink well.
    Ms. O'Neill. Our cost estimates contain more and more 
information about the methods used to produce them.
    Mr. Fazio. Which ultimately leads to more criticism.
    Ms. O'Neill. That is one downside. But we also get a lot of 
visits from members of parliaments in other countries who are 
interested in budgeting, and they all marvel at the products 
that CBO puts out. They tend to wish that they had that much 
information to help them do their work.
    Mr. Fazio. But your view is increased transparency is good 
for the process, you make adjustments to it. Do you take into 
consideration your critics comments? Do you factor these in for 
further analysis?
    Mr. Blum. We believe in making public all of the critical 
assumptions that underlie our estimates of all kinds, so that 
we are not a black box where people just dip into the inkwell, 
as you suggested, and pull out a number. A lot of research and 
analysis goes into our estimates, and we like to provide the 
basis for those numbers. Then if you or other parties question 
some of the assumptions and ask what the result would be with 
some alternative assumption, we will be able to reply to you.
    Mr. Fazio. I think that is particularly important, because 
I am firmly in the camp of those who want CBO to be less 
political, rather than more so, and be more generally agreed by 
economies across the spectrum to be fair in a way in which they 
go about making their difficult decisions. The more we 
understand how you come to them, the more we can argue those 
premises and hopefully eliminate a lot of, you know, 
unfortunate debate that does occasionally go on. I mean, the 
more we can put in the camp of ideologies, some of these 
debates, it may be for the better, and take it for what it is 
worth.

               Methods for Developing Bill Cost Estimates

    Ms. O'Neill. I and all the staff at CBO take our 
nonpartisan nature very seriously, and we do the estimates as 
objectively as we possibly can. If somebody came forward with 
information that showed we had made an error, of course we 
would not ignore it.
    Mr. Fazio. Right.
    Ms. O'Neill. We would take it into account.
    Mr. Fazio. Some of this is error occasionally.
    Ms. O'Neill. Well, especially when it comes to economic 
methodologies. As you know, we combine many sources and our 
final estimates are often a judgment call, but we stay abreast 
of economic and other literature, and we are usually pretty 
much where the consensus is.
    Mr. Fazio. Just to conclude, I think openness is our 
greatest protection against people making assumptions that 
there is a bias at CBO. It ought to be obvious when there is 
one, and it ought to be part of the debate within the economics 
field, otherwise it ought to be clear.
    And I also want to say, for the record, Mr. Chairman, I 
think any effort to remove Ms. O'Neill before the end of her 
term would be a totally inappropriate, unfortunate decision, 
totally apart from who she is or how I might evaluate her task. 
I think the decision has been always to allow the director of 
this agency to serve for the time to which he or she is 
appointed, because we don't want to allow the impression, even, 
let alone the reality, that decisions that are made, tough 
calls that get made, particularly about economic philosophy or 
some of those that underlie the premises upon which this 
analysis is based, have contributed to her appointment or her 
removal. I think it would be an undermining of the original law 
that created CBO if we take that approach. I hope it will not 
be something that rumors we read about in local newspapers or 
follow through on, you know, I hope it is all conjecture and 
not really somebody's agenda. I think it is far more than a 
partisan issue, I think it is an institutional issue, and that 
is the reason I raise it here.
    My view is we continue to struggle and make this entity 
what we intended it to be, and we ought not let the various 
winds that blow back and forth here politically, 
philosophically, and ideologically on a partisan basis ever 
interfere with the selection process, or, particularly, 
anyone's ability to fill out their term because we are not 
happy with some judgment call they made. I hope I don't speak 
just for myself. I hope I speak for a bipartisan group of 
Members, but I am certainly going to be making my views very 
clear if it comes to the need to do that.
    Mr. Walsh. Mr. Hoyer.
    Mr. Hoyer. Thank you.
    I want to associate myself with Vic's remarks. One of the 
directions that we chose to take, in the 103rd and even the 
102nd Congress, and which were accelerated, at least 
rhetorically in the 104th Congress, was the professionalization 
and depolitization of the Congress' ministerial tasks, that is, 
tasks which are performed not in terms of making policy but 
providing information upon which policy may be based.
    I think Congressman Fazio is absolutely correct, this is an 
institutional issue, not a partisan issue of either side, and 
if we are committed to that, which I think we are, and I think 
there is bipartisan support for that effort, then I would share 
Vic's great concern. Although I haven't talked to the Chairman 
about it, the Chairman is very concerned about institutional 
integrity, that we not see politically-motivated decisions made 
because of answers received that are maybe intellectually and 
academically defensible but which are not politically 
desirable. I think that would be a real undermining of the 
integrity of the CBO and the integrity of the offices we have 
set up to provide us with the best possible information we can 
have on which to base policy decisions. You don't need to 
comment on that, obviously.
    Let me ask you a question. It will not come as a surprise 
to you that I continue to be interested, along with my 
colleagues, on the competitiveness of the Federal Government in 
the personnel marketplace. You indicated that in some 
instances, particularly with young economists, your phrase was 
newly minted----
    Ms. O'Neill. The trouble is at both ends of the employee 
spectrum. We have trouble hiring new economists as well as 
retaining our experienced staff, because other employers----
    Mr. Hoyer. The question I want to ask is, do you have 
people here who have the competitive figures, i.e., to hire a 
young, bright, able economist, out of Wharton or one of the 
better schools around the country, what do you have to pay?
    Ms. O'Neill. Let me ask Dave Delquadro, our personnel 
director.
    Mr. Hoyer.  Let me put it this way, what do we pay and what 
does the private sector pay?

          Employee Compensation at CBO and Other Organizations

    Mr. Delquadro. Our biggest competitor is the Federal 
Reserve Board in terms of bringing a lot to the table on the 
salary and fringe benefit sides. The Fed is currently offering 
its new Ph.D. economists between $71,000 and $72,000 in annual 
salary, plus a very generous benefit package. The Urban 
Institute and CBO are around the $59,000-$61,000 market range, 
and we are not sure how that is going to work. I mean, frankly, 
last year----
    Mr. Hoyer. It is about an 18 percent disparity, and if you 
factor in benefits, probably closer to 24, 25 percent.
    Mr. Delquadro. That is about right, sir.
    Mr. Hoyer. Let's say the 10- to 15- to 20-year experience 
level, you indicated in your testimony there may be as much as 
a 50 percent disparity.
    Ms. O'Neill. This has been our experience over the past 
year in some of the instances in which we have lost someone, 
and I can think of a number of cases.
    Mr. Hoyer. Can you give me, without mentioning individuals, 
some salaries?
    Ms. O'Neill. One, a newly minted Ph.D. economist, was 
offered $85,000 and took a job with a private consulting firm, 
and I think that amount was plus----
    Mr. Delquadro. We are not sure what the benefit package 
was.
    Ms. O'Neill. It was a lot. One university offered, and the 
person accepted, something around $80,000 for essentially a 9-
month job, which is----
    Mr. Hoyer. These are newly minted people?
    Ms. O'Neill. Yes.
    Mr. Hoyer. My question was when we talk about pay and 
adjustment of pay, we talk about recruiting and retention. 
Recruiting is what private sectors are starting new people out 
of college or 1, 2, 3, 4 years of experience. Retention is when 
we have somebody 15 years into our system, trained into our 
system, obviously more valuable to our system. Do you have 
examples of comparable differences?

            Difficulties in Retaining Highly Qualified Staff

    Ms. O'Neill. The differences can be quite large for 
experienced managers because of the ceilings that we face here. 
There is the director's salary, which is capped at $125,900.
    Mr. Blum. It is an Executive Level 3 position.
    Ms. O'Neill. We are in a situation in which the assistant 
directors at CBO are coming very close to the director's 
salary. You know, we cannot really compete in markets in which 
sophisticated financial people who have considerable knowledge 
of, for example, defense weapons can be offered amounts that 
far exceed what we are allowed to pay.
    Mr. Hoyer. First of all, your assistant directors are 
making what?
    Mr. Blum. $121,000 per year.
    Mr. Hoyer. What would be a comparable private sector 
salary?
    Ms. O'Neill. It varies. I think everybody knows that Mr. 
Kies was recently lured away from the Joint Committee on 
Taxation with the offer of a very, very high salary.
    Mr. Hoyer. At half a million, or $750,000.
    Ms. O'Neill. We have had people who have left CBO and are 
now earning twice, maybe even three times, as much as their CBO 
salary.
    Mr. Hoyer. Therefore, I presume a 3.1 percent adjustment, 
particularly when that is proposed for absorption; secondly, 
locality pay is to be a component of that 3.1 percent, as 
opposed to an add-on. I presume that will further erode your 
competitive status as it relates to your salary structure.
    Ms. O'Neill. Yes, it will.
    Mr. Hoyer. Mr. Chairman, I make that point only because 
governmentwide we are going to have to deal with that, but Mr. 
Kies' analogy, I think, probably is not exact because Mr. Kies, 
as many Members of Congress know, is getting paid for more than 
his skills, he is getting paid for who he knows, and so on.
    Ms. O'Neill. That is a fair point.
    Mr. Hoyer. But the fact is, Mr. Chairman, we are having 
trouble on the Hill recruiting and retaining people. Now we get 
young people because of their desire to have experience here, 
but we train them, they get them up to speed and they get 
really good and then they can get 50 percent or 100 percent 
more in the private sector, and while we will never compete 
with that, I really do believe that, particularly now with the 
balanced budget, the 3.1 percent that has been proposed is 
inadequate for us to even close the gap that exists. That gap 
will grow and our competitive position is eroding.
    Thank you, Mr. Chairman.
    Mr. Walsh. Thank you for your comments.

                      Other Recruitment Incentives

    Since you addressed some of those comments to me, I agree 
that we need to pay a decent wage for a decent day's work, but 
we are a not-for-profit organization, and many individuals do 
come to government, altruism brings them here, sometimes the 
training they get brings them here, sometimes ambition brings 
them here, and then they can use that learning to move on to 
the private sector, and we certainly encourage our staff to do 
that because they are not going to get rich working for 
government. That is not why any of us came here. But we do need 
to pay a good wage for a good day's work.
    Ms. O'Neill. That is certainly true of staff at CBO who 
work because of their intrinsic interest and because they are 
able to do work that is relevant for policymaking.
    Mr. Walsh. We are glad altruism is alive and well. Mr. 
Cunningham.
    Mr. Cunningham. Thank you.
    I know there was conversation in the background, and I am 
on different committees and I haven't really focused on what 
colleagues are talking about down here. But I would tell them, 
if I am going to a target and a pilot makes an error, enough to 
get them killed or taken prisoner, I am not going to let the 
person fly again. And if they demonstrated bad judgment, I am 
probably going to demote that individual to a lesser grade or 
at least pull their wings. I don't know the circumstances 
behind the CBO's gross mis-estimates in budgets and revenue. 
But I guarantee you my decision is not going to be partisan, 
you know me better than that. I am hard and I can be tough, but 
I am going to look at this, not in a partisan way, but to see 
if, in fact, the CBO failed to observe some common sense 
values. For example, there is the area of dynamic scoring. I 
don't know about you, but if I get more money in my pocket, I 
am going to spend more and it is going to change the economy. 
That is just common sense. And you have to take a look at those 
kind of things when you are making evaluations and estimates of 
the budget and the economy.
    I was working toward a doctorate degree in this field 
before I came here, so I understand a little bit about the 
terminology and what is involved in it. But it is incorrect to 
suggest that concern over the quality of budget and economic 
analysis is partisan. I think we need to take a look at where 
you have somebody doing a good job, you reward them, or if they 
are not, you fire them, and that is going to be my position.
    Thank you, Mr. Chairman.
    Mr. Walsh. Are there any other questions?
    [Questions from Mr. Cunningham and responses follow:]

    Question. You explained in your testimony some 
justification for CBO's gross overestimation of the budget 
deficit in the current fiscal year, and for its underestimation 
of revenues in the current fiscal year. As you know, these 
estimates have substantial policy implications for lawmakers 
across the political spectrum; for those who see a budget 
surplus as a justification for cutting taxes, and for those who 
see it as justifying spending increases. Fundamentally, if CBO 
is and was so far off in its estimates, why was that so, and 
what should be done about it? By what standard should the CBO 
be held accountable?
    Answer. Estimating errors, even large ones, can never be 
eliminated because the revenues and outlays that comprise the 
federal budget are affected by a myriad of economic and other 
factors, both here and abroad, that are difficult--if not 
impossible--to predict exactly. With total revenues and outlays 
each approaching $1.7 trillion, small percentage deviations 
from the amounts in CBO's projections can easily swing 
budgetary outcomes by tens of billions of dollars. For example, 
if the revenue and outlay estimates were both off by as little 
as 1 percent in opposite directions, the estimate of the 
deficit or surplus would be off by $30 billion to $40 billion. 
Over the past decade, the difference between actual results and 
CBO's January estimate of revenues and outlays has averaged 
about 2 percent for each.
    One standard by which CBO can be held accountable is how 
our estimates compare with those of others in the budget-
estimating business. By that standard, I believe that CBO has a 
very good track record. All budget estimators, including the 
Office of Management and Budget and private-sector analysts, 
were surprised by the turn of events in fiscal year 1997. For 
example, the President's budget transmitted to the Congress in 
February of last year estimated a $126 billion deficit for 
fiscal year 1997, $2 billion higher than CBO's $124 billion 
estimate. Yet the final deficit was only $22 billion. Most 
private forecasters were similarly off the mark: for instance, 
at the beginning of the year, DRI projected a deficit of $127 
billion, Goldman and Sachs, $135 billion, Macroeconomic 
Associates, $117 billion, and Morgan Stanley, $145 billion.
    As described in my prepared statement, several major 
factors contributed to the lower-than-estimated deficit in 
1997. First, the economy performed better than expected, 
raising the level of taxable income as measured by the 
government's national income and product accounts. Second, 
large profits led to large bonuses, while a soaring stock 
market further expanded the tax base through increased 
realizations of capital gains and increased exercising of stock 
options. Moreover, a growing share of income was earned by 
people at the top of the income ladder, who are taxed at higher 
rates. Those factors, some of which were unusual and 
unpredictable (such as the stock market, bonuses, and stock 
options) led to revenues that were $72 billion higher than CBO 
estimated a year ago in January, accounting for 70 percent of 
the total deficit-estimating error. A smaller overestimate of 
outlays in a variety of entitlement programs accounted for the 
remainder. Unfortunately, the estimating errors in outlays 
reinforced rather than offset the errors in revenues.
    We have made every effort to learn from last year's 
estimating mistakes, yet it seems inevitable, given the perils 
of projecting, that large errors will occur from time to time. 
The uncertainty involved in economic and budget forecasting is 
a point that we have particularly emphasized this year in our 
latest budget projections.
    As a result of our estimating errors in 1997, we have taken 
steps to provide the Congress with an early-warning mechanism 
that will signal when actual receipts and outlays are deviating 
from our estimates for the current fiscal year. We routinely 
review monthly and even daily Treasury statements of receipts 
and outlays to monitor actual tax collections and expenditures. 
We are now making public the results of our reviews in a 
Monthly Budget Review report, and this report, as well as our 
published reports and analyses, is posted on our Web site.
    Question. Explain the CBO's perspective on the matter of 
``dynamic scoring''--that is, the assumption that budget 
estimates reflecting changes in taxation or government spending 
should take into account the impact of those changes on 
economic behavior.
    Answer. The term ``dynamic scoring'' has several 
interpretations. Many people mistakenly believe that estimates 
prepared for the Congress of the budgetary effects of spending 
or tax proposals do not take into account the changes in 
behavior that could result from passage of those measures. In 
fact, all Congressionally mandated budget estimates, whether 
the spending estimates required of CBO or the estimates of 
receipts prepared by the Joint Committee on Taxation, employ 
the same basic estimating conventions. Such conventions 
incorporate assumptions about how changes in taxation or 
government spending might change individual behavior in 
response to new economic incentives.
    Those behavioral and other estimating assumptions cover a 
wide variety of microeconomic effects and reflect the best 
available research and estimating methodology. For example, the 
estimate for a proposal to subsidize health insurance for early 
retirees would include the additional costs associated with the 
likely increase in the number of early retirees that would 
result. Similarly, the estimate for a proposal to increase the 
excise tax on tobacco products would take into account the 
resulting decrease in the consumption of cigarettes.
    In most instances the estimating conventions employed in 
producing bill cost estimates are not controversial. Questions 
may arise, however, in two types of situations. First, 
estimators sometimes disagree about the magnitude of 
microeconomic responses, such as the extent to which 
consumption would be reduced by an increase in excise taxes. 
Second, some proposed legislation could give rise to 
macroeconomic effects, which are not included in routine cost 
estimates. That is, a major tax or spending measure might 
affect saving, investment, or work effort and thereby affect 
the potential growth rate of the economy. In that sense, it is 
sometimes argued that the assumptions used for budget estimates 
are not dynamic enough.
    Although it may appear desirable to estimate the effect of 
proposed legislation on the macro economy, in practice it is 
impractical to do so, particularly for routine bill cost 
estimates. However, as discussed below, CBO has prepared 
analytical studies of the macroeconomic effects of major 
legislative proposals.
    Estimates of macroeconomic effects are not routinely provided for 
all bill cost estimates for the following reasons. First, in instances 
in which research bearing on the topic is available, the extent of 
disagreement among economists on the magnitude of macroeconomic effects 
is frequently so large that no point estimate could be meaningfully 
treated as a consensus. In othercases, little or no research may be 
available on which to base an estimate. Furthermore, we often lack 
sufficient time and resources to produce the complex estimates 
required. Finally, long-run changes in macroeconomic variables could be 
invisibly small in the five- or 10-year period used for budget 
estimates, even if they were likely to be significant in later years. 
In consequence, the routine incorporation of macroeconomic effects into 
budget estimates would be subject to considerable uncertainty and 
possibly endless controversy.
    Nevertheless, the Congressional Budget Office has provided 
information about the possible macroeconomic effects of major 
legislation in a number of analytical studies. Those studies 
were feasible because an extensive economics literature was 
available for reference and sufficient time and resources were 
available for proper analysis. Moreover, unlike bill cost 
estimates, a study allows for a range of results. For example, 
CBO included an analysis of the macroeconomic effects of the 
1997 budget reconciliation package in its update of the 
economic and budget outlook published last September. Last year 
CBO also published a study of the possible economic effects of 
comprehensive tax reform. In addition, the budget resolution 
for fiscal year 1998 incorporated assumptions made by CBO on 
the macroeconomic effects of balancing the budget. This 
produced a so-called fiscal dividend that reduced the magnitude 
of the policy changes needed to reach budgetary balance.
    Question. How has the Internet changed how you research and 
distribute information, and has it affected your management and 
budget? Why or why not?
    Answer. Use of the Internet is a critical element in much 
of CBO's work. As an example, Internet use has been essential 
to the timely preparation of federal private-sector mandate 
estimates. Using the Internet improves our analysts' ability to 
monitor bills, follow the relevant issues, and complete cost 
estimates in a timely manner.
    The following are some examples of the types of documents 
and information CBO obtains from the Internet:
          Copies of bills, public laws, hearing transcripts, Committee 
        reports, and the Congressional Record.
          Scheduling information for Congressional hearings, Committee 
        markups, and floor action.
          Academic papers, government reports, information from the 
        Library of Congress, and Congressional Research Service issue 
        briefs, reports, and public policy literature abstracts.
          Information and data from federal agencies, trade 
        associations, interest groups, research institutions, and 
        nonprofit organizations.
          U.S. Code and the Code of Federal Regulations.
          Industry glossaries and telephone directories.
          Current news from many sources.
    A CBO web site was launched in September 1997 in response 
to requests for additional access to our information. Our first 
priority for posting on our site is all currently produced 
general work products. As time and resources permit, we are 
also including certain CBO publications issued before last 
September as well as expanding the type of file format 
available to include spreadsheets where appropriate. Although 
the response to our Web site has been quite positive so far and 
we have received nearly 100,000 requests for information since 
September, it is not yet clear whether the demand for printed 
copies of our publications will drop.
    The growing use of the Internet as both a source of and 
distribution tool for information has primarily affected our 
budget through the purchase of the hardware, telecommunications 
services, software, and web development expertise needed to 
establish and maintain our link to the network. We are also 
beginning to explore the value of a CBO Intranet as an 
electronic means of standardizing and sharing management and 
administrative information and functions across the 
organization.

    Mr. Serrano. Mr. Chairman, before you close, I just want to 
make sure that you accept as a unanimous position from this 
side, not just from my senior colleagues, our desire that the 
original vision of having this agency be known as a bipartisan 
and nonpartisan office remains that way, and that that is a 
very serious concern on our side. I want to make sure I am on 
the record as being part of their comments.
    [A question from Chairman Walsh and response follow:]

    Question. For the record, please supply all reprogrammings 
requested last year, and their disposition.
    Answer. CBO made no requests to reprogram funds in fiscal 
year 1997.

    Mr. Walsh. Your comments are certainly accepted and now 
part of the record. I think we all agree for the need that this 
office be nonpartisan. I don't think we need to spend a lot of 
time talking about conjecture in the press with regard to the 
director's position. We need to stick to the budget here and 
let the conjecture fall to someone else. But thank you very 
much for your testimony today.
                                        Thursday, February 5, 1998.

                       GOVERNMENT PRINTING OFFICE

                               WITNESSES

MICHAEL F. DiMARIO, PUBLIC PRINTER
ROBERT T. MANSKER, DEPUTY PUBLIC PRINTER
FRANCIS (FRAN) J. BUCKLEY, JR., SUPERINTENDENT OF DOCUMENTS
WILLIAM M. GUY, BUDGET OFFICER
    Mr. Walsh. All right. We will now consider the fiscal year 
1999 budget from the Government Printing Office. We would like 
to welcome Mr. Michael DiMario, Public Printer.
    The 1999 budget request totals $114.2 million. That would 
be an increase of $3.5 million over the amount available for 
the current year.
    There are two appropriation accounts involved: The 
Congressional Printing and Binding appropriation and the 
Superintendent of Documents program. In addition, under the 
government corporation statutes, the appropriation bill 
authorizes the appropriation--or the operation of the GPO 
revolving fund, which finances all printing which flows through 
GPO. This includes executive and judicial branch printing and 
printing by GPO from commercial sources for those branches of 
government.
    Before proceeding, I am going to ask you to begin. I am 
going to leave the room for a brief time, and Congressman 
Cunningham is going to take the gavel, and I will return as 
quickly as I can. Would you like to introduce your staff and 
include biographies of those who are new to the subcommittee. 
We have your prepared statement, and once you introduce your 
staff, you can feel free to summarize.

                       Introduction of Witnesses

    Mr. DiMario. Thank you, Mr. Chairman.
    With me, to my right, at the extreme right, is my deputy, 
Bob Mansker, and to his left is Francis Buckley, Superintendent 
of Documents. Immediately on my right is William Guy, who is 
the Budget Officer.
    Mr. Mansker spent many years as a staff member here at the 
House and is quite familiar with Congressional operations and 
later served at the Joint Committee on Printing.
    [The information follows:]

                           Robert T. Mansker

    Robert T. Mansker was appointed Deputy Public Printer of 
the United States effective September 23, 1997. Mansker came to 
this position from the Joint Committee on Printing where he 
served as Minority Staff Director since the beginning of 1997. 
From 1995 to 1997, he served as the Joint Committee's Deputy 
Director for the minority.
    A native of Texas, Mansker earned his bachelor's degree 
from the University of Texas. He holds a master's degree in 
personnel management/government and a doctorate in business 
administration/government and higher education, both from Texas 
A&M University. He was an associate professor of business 
administration and visiting lecturer at Texas A&M, where among 
other subjects he taught business law, personnel management, 
and labor relations.
    Mansker has been active in government since the early 
1960's. He served as administrative assistant to several 
members of the Texas House of Representatives. In 1979 he 
became press secretary to Congressman Martin Frost, a position 
he held for 14 years before becoming Staff Director for the 
House Administration Committee's Appeals Panel of the Office of 
Fair Employment Practices. In 1993, Frost appointed him Staff 
Director of the Accounts Subcommittee, Committee on House 
Administration. Congressman Steny H. Hoyer of Maryland named 
Mansker to the Joint Committee on Printing in 1995.
    The 56-year-old Mansker has been active in numerous 
organizations including the Lions Club International and the 
Elks Lodge. He has served as president of both the Tiber Island 
Cooperative Homes, Inc., of Washington, DC, and the Association 
of House Democratic Press Assistants.

    Mr. Buckley has been very active in the library community, 
as librarian at the Detroit Public Library, where he was 
associate director for many years, and later on as Director at 
the Shaker Heights Public Library in Shaker Heights, Ohio. He 
has come to us from that position, so we are delighted to have 
him with us. He has been very active with the American Library 
Association over the years and has testified many times before 
Congress on the issue of depository libraries, and we consider 
him to be a real asset coming on board, as we do with Mr. 
Mansker. So I am delighted to have these additions to the 
staff.
    [The information follows:]

                        Francis J. Buckley, Jr.

    Francis J. Buckley, Jr., was appointed Superintendent of 
Documents effective December 1, 1997. Buckley came to this 
position from the Shaker Heights Public Library in Shaker 
Heights, Ohio, where he served as Director since 1994. From 
1966 to 1994, he was with the Detroit Public Library where he 
rose from reference librarian and documents specialist to 
associate director for public services, with a two-year break 
for service in the Army, including duty in Vietnam. Buckley 
earned his bachelor's degree and his master's degree in library 
science from the University of Michigan. He is a member of the 
Beta Phi Mu International Library Science Honor Society.
    Buckley has been an active member of the American Library 
Association (ALA) since 1974, serving several terms on the ALA 
Council and chairing a number of important ALA committees, 
including the Government Documents Round Table, the Ad Hoc 
Committee to Form a Coalition on Government Information, and 
the Lippincott Award Jury. He has served on the ALA's 
Legislation Committee and chaired its Subcommittee on 
Government Information. He has served on the ALA's Coordinating 
Committee on Access to Information and the Special Committee on 
Freedom and Equality of Access to Information. Buckley has also 
been active in the Special Libraries Association, the Michigan 
Library Association, the Government Documents Round Table of 
Michigan, the Michigan Library Consortium, the Southeast 
Michigan League of Libraries, and the Ohio Library Council. He 
was on the board of trustees of the Cleveland Area Metropolitan 
Library System, and served on the board of trustees of the 
Online Computer Library Center (OCLC).
    For the past 20 years, Buckley has written and spoken 
extensively on the importance of public access to Government 
information. In the late 1970's, he was a member of the Ad Hoc 
Advisory Committee on the Revision of Title 44, U.S.C., the law 
controlling the dissemination of Federal publications. He was a 
member and chair of the Depository Library Council to the 
Public Printer, which provides advice on GPO's Federal 
Depository Library Program. He chaired the Inter-Association 
Working Group on Government Information Policy, representing 
the ALA and other national library associations, which was 
formed to recommend and review proposed changes to Federal laws 
on information dissemination that are currently under 
consideration.
    Buckley also has an active record of civic involvement. He 
served on the Literacy Advisory Committee of the Detroit Head 
Start Program, and was on the board of directors of the Detroit 
Literacy Coalition. He also served on the Research Committee of 
the United Community Services of Metropolitan Detroit, in 
addition to local community development and historic 
preservation organizations.

    We also have other staff members in the audience.
    Mr. Cunningham [presiding]. Welcome to all of you.

                        public printer statement

    Mr. DiMario. Thank you, Mr. Chairman.
    For fiscal year 1999, we are requesting a total of $114.2 
million for those programs that require appropriations directly 
to GPO. The request includes $84 million for the Congressional 
Printing and Binding Appropriation and $30.2 million for the 
Salaries and Expenses Appropriation of the Superintendent of 
Documents. This is an increase of $3.5million, or about 3.1 
percent, over the level of funding approved for fiscal year 1998, 
including the onetime transfer of approximately $11 million from our 
revolving fund to the Congressional Printing and Binding Appropriation.
    The Congressional Printing and Binding Appropriation is 
critical to the maintenance and operation of our in-plant 
capacity, which is structured to serve the information product 
needs of the legislative process in Congress. This 
appropriation covers the costs of congressional printing, such 
as the Congressional Record, bills, reports, hearings, and 
other products. Each year a substantial volume of this work is 
requisitioned by the Members, committees, and other offices of 
Congress. This appropriation also covers database preparation 
for congressional publications disseminated online via GPO 
Access, our Internet information service.
    The majority of the Superintendent of Documents' Salaries 
and Expenses Appropriation is for the Depository Library 
Program. While some of the funding for this program is for 
salaries and benefits, most is for producing and disseminating 
publications to depository libraries, including publications in 
CD-ROM and online formats.
    This appropriation also provides the majority of the 
funding for the operation of GPO Access. I am pleased to report 
to this Subcommittee that the successful operation of GPO 
Access has required less funding than was originally projected 
by the Congressional Budget Office, while performance has far 
exceeded the original expectations of the legislation. Our 
recent Biennial Report to Congress on the status of GPO Access 
discusses the financial performance of this information system.
    Our budget submission and my prepared statement detail our 
request. We are requesting one change to our legislation, and 
that is the deletion of the statutory limitation on our full-
time equivalent employment, or FTEs.
    We have reduced employment by more than 25 percent since 
early 1993. This reduction was accomplished primarily through 
attrition. We successfully lowered our costs while preventing 
interruptions in service to Congress, Federal agencies, and the 
public. However, some critical areas, including those that 
serve Congress, are now fully reduced and cannot withstand 
further reductions without impairing performance and service 
provision.
    GPO is now at its lowest employment level in this century. 
Allowing us to manage our FTE resources within the constraints 
of available funding, rather than under a statutory limit, will 
give us the flexibility we need to continue providing essential 
services, especially during periods of peak workload demands.
    Mr. Chairman, this concludes my opening statement and I 
would be happy to answer any questions you may have.
    [The information follows:]

[Pages 675 - 682--The official Committee record contains additional material here.]


    Mr. Cunningham. Do you want to go ahead? Is there anyone 
else, anyone else going to testify?
    Mr. DiMario. That is it.
    Mr. Cunningham. You say your level is at the lowest. What 
is your level? I missed that in there.
    Mr. DiMario. Our actual employment is at 3,512 at the 
moment.

                         DOCUMENT DISTRIBUTIONS

    Mr. Cunningham. All of us get your documents back at the 
Cloakroom there. And I have often wondered, how many of them 
were actually returned? Are there too many of them printed, or 
not enough? I know they sit back there in a pile and I never 
know what happens to them after that. Are they used? Are they 
stored?
    Mr. DiMario. I can't speak to how they are used. When we 
deliver them to the Hill, they are for the Hill's use.
    Mr. Cunningham. You have a certain number.
    Mr. DiMario. Yes, sir.
    Mr. Cunningham. Because I didn't know if anyone had ever 
taken a look that they were being overprinted or underprinted.
    Mr. DiMario. There has been a substantial reduction in the 
amount of printing that is being produced for the Congress, and 
I think that is an important point. Our congressional workload 
has declined. In fiscal year 1995, we had 757,000 original 
pages of all categories of congressional publications that we 
outputted, and in 1997, we outputted 611,000 pages, and that is 
a reduction of 19 percent. So, there is a clear decrease, and I 
think to a large measure it is because of action by this 
Subcommittee with respect to the House. The House has had a 
substantial reduction in the amount of Congressional Record 
copies that we produce.
    Mr. Cunningham. One of the things we did is cut off the 
number of Congressional Record copies printed. We can't send so 
many copies to our constituents. How much does that save; do 
you know?
    Mr. DiMario. I believe that reduction in terms of the 
constituent copies saved about $1.2 million.
    Mr. Cunningham. That is quite a bit. Maybe we hand carried 
it to our constituents.
    Mr. DiMario. There were some 5,466 copies that were cut.
    Mr. Cunningham. When you say you have the lowest level 
also, of the increase, how much is that as pay and salary?
    Mr. DiMario. The bulk of the increase is in fact, for 
salaries and benefits. Very little of the increase is 
associated with anything else, so I would say for all intents 
and purposes, the $2.3 million increase is in the salaries.
    [Questions from Mr. Cunningham and responses follow:]

    Question. Describe the extent to which your computer 
systems are Year 2000 compliant, and your plan for achieving 
compliance.
    Response. We have completed the assessment phase of our 
Year 2000 program efforts. A total of 107 systems were reviewed 
and 56 mission critical systems were identified to be replaced 
(9) or repaired (23). To date approximately 18% of the systems 
being repaired have been completed and tested, with a January 
1999 target date for the completion for the remaining systems. 
We are currently reviewing the various efforts for acquiring 
the replacement systems and will be formalizing the milestones 
and implementation schedules for each individual project. 
Contingency plans will be developed for any project with a 
targeted implementation date beyond March 31, 1999. The 
recently established GPO Year 2000 Program Management Office 
will be monitoring our ongoing Year 2000 efforts to assure the 
timely completion of year 2000 compliance for all of our 
mission critical systems.
    Question. What percentage of agencies' printing is 
performed through GPO? If this percentage or market share is 
declining, why is that so? Notwithstanding the requirements 
imposed by Title 44, what justification is there for the 
continued existence of an agency that seeks to monopolize 
public printing duties when there is a vibrant and competitive 
local market for printing services, and when agencies already 
develop and manage contracts for many other services, including 
some of their core responsibilities?
    Response. We estimate that about half of executive branch 
printing is not performed through GPO. The amount of printing 
not coming through GPO is because agencies are authorized by 
law or by the JCP to perform their own printing, the increased 
use of electronics, and to some extent failure to comply with 
Title 44. Some agencies, such as the national security 
agencies, are exempt from the requirement to use GPO. The JCP 
has authorized approximately 150 plants Government-wide to do 
work in-house, and agencies operate a large number of 
duplicating centers, accounting for much of the work not coming 
through GPO. To an extent, electronic formats are replacing 
print products, further reducing the amount of printing coming 
through GPO.
    Some agencies have emphasized decentralization of 
responsibilities irrespective of cost and without adequate 
attention to preserving the benefits of economies of scale and 
public policy goals furthered by GPO programs. This has led to 
work being withdrawn from GPO, where it would be procured from 
the private sector, and instead produced in expanded agency in-
house facilities. Agencies have also attempted to procure work 
themselves, at higher cost to the taxpayer. When agencies 
perform these operations which are required by law to be 
performed by GPO, taxpayers pay more and citizen access to 
Government publications is impaired. DOD's Defense Automated 
Printing Services (DAPS) and NASA have developed unnecessary 
in-house capability and GSA and NTIS have increased marketing 
of their in-house production services, all at the expense of 
GPO's printing procurement program, which is run in partnership 
with the private sector printing industry.
    GPO is not a monopoly but provides central management and 
oversight to a system of informing the nation that is 
fundamental to our Government, and we do it efficiently, 
economically, and effectively and in such a way as to ensure 
comprehensive and equitable access to government information. 
We contract out 75% of all work, utilizing a nationwide network 
of about 10,000 private sector printers to achieve lowest 
competitive price. Decentralization of this function by 
allowing each agency to procure its own printing would be 
tremendously costly to taxpayers: by some estimates, a 
decentralized system of printing could end up costing twice as 
much as the current system. The centrally managed system in GPO 
takes maximum advantage of economies of scale and 
specialization, achieves greatest degree of competition to 
ensure lowest cost to taxpayers, and ensures that the 
publications get into the depository library and sales programs 
for use by the public.
    Question. Why did the Department of Defense elect to 
perform more of its printing functions through its own agency, 
rather than through the GPO?
    Response. For many years DOD was authorized by the JCP to 
operate various in-house printing capabilities to provide for 
its immediate administrative needs. However, following the 
consolidation of these capabilities in the early 1990's (into a 
service now known as the Defense Automated Printing Service, or 
DAPS), it now appears that DOD has an excessive internal 
production capability. In order to keep this excessive internal 
production capability utilized, DAPS apparently is retaining 
for in-house production a large amount of printing that 
formerly was sent to GPO for procurement from the private 
sector. In our view, it is costing the taxpayer more to have 
DOD printing done this way.
    Last year, Congress passed P.L. 105-85 to address the 
higher costs created by the way DOD handles its printing. This 
law permits DOD agencies to use GPO rather than DAPS for the 
procurement of printing. It also prohibits DAPS from imposing a 
surcharge on ``any printing and duplicating service for the 
Department of Defense that is procured from a source outside of 
the Department.'' Most DOD components have expressed the view 
to GPO that they would prefer to deal directly with GPO on 
commercial procurement, as provided by P.L. 105-85. However, it 
is not clear to us that DOD has implemented this law in 
accordance with congressional intent. There are indications 
that DAPS is still imposing a surcharge or ``processing fee'' 
on DOD printing orders. In addition, just recently DAPS 
initiated action to cancel three viable and less costly GPO 
contracts in favor of doing the work in-house on newly acquired 
equipment.
    Question. Describe in additional detail your testimony that 
the Department of Defense is late paying its bills.
    Response. Prior to FY 1992, GPO accepted requisitions from and 
issued invoices directly to ordering DOD components. At the end of FY 
1992, GPO's accounts receivable from DOD were about $32 million and 
unpaid invoices over 60 days old amounted to about $9 million, or 28 
percent of the total. Ever since the Defense Printing Service (known 
today as DAPS) was established in 1993, the overall volume of printing 
and publishing performed by GPO for DODhas been consistently 
decreasing. It dropped from $267.7 million in FY 1991 to $156.6 million 
in FY 1997, but total receivables and delinquencies have increased. As 
of the close of business on December 31, 1997, total DOD receivables 
reached $52.7 million with unpaid invoices over 60 days amounting to 
$24.3 million, or 46 percent.
    GPO has made several changes to its accounting system to 
assist DOD in improving its payment record, but none for the 
agreed to initiatives has been fully implemented by DAPS. In 
May 1997, the Under Secretary of Defense (Comptroller)/Chief 
Financial Officer issued a memorandum requiring customers of 
DAPS to pay for their printing orders by credit card beginning 
in July 1997. GPO's accounting staff has attempted to work out 
arrangements where DAPS would pay GPO via credit card. As of 
February 1998, DAPS official have agreed to use credit cards on 
a pilot basis for two locations to pay GPO. However, that 
decision will not impact the current amount of past due 
payments.
    In order to resolve the payment problems, DOD's existing 
policy should be revised so that DOD customers can deal 
directly with GPO should they desire to do so, in accordance 
with P.L. 105-85. GPO can accept payments via VISA IMPAC credit 
cards and we have developed a new deposit account system that 
will perform the accounting for DOD and streamline DOD's 
billing and payment processes. Currently, there are more than 
200 DOD procurement offices using GPO deposit accounts to pay 
for the notices they publish in the Commerce Business Daily. 
Use of deposit accounts virtually eliminates the need for GPO 
to produce invoices. If DOD printing customers were allowed to 
deal directly with GPO, they would have more purchasing power 
because they would avoid having to pay the DAPS surcharge for 
what is essentially a duplicate billing activity. We are 
convinced that this change in DOD policy will resolve the 
billing and collection problems between both agencies.
    Question. Again, notwithstanding the requirements of Title 
44, what justification exists for the GPO to post documents on 
the Internet, rather than having agencies do it themselves or 
manage contracts for such a service?
    Response. Agencies are not required to post documents on 
GPO's Internet site, called GPO Access (at www.access.gpo.gov). 
We are authorized by law to do this for agencies. Agencies come 
to GPO because we save them money and achieve maximum public 
visibility through our online system. Many agencies have asked 
us to put up their GILS records and other files. Our system is 
the only Government-wide system featuring documents from all 
three branches of Government. Ours is one of the few to assure 
authenticity of documents through PDF formatting. Ours is one 
of the few to assure permanent public access. The Government 
has saved millions by creating Internet access through GPO 
since we simply converted printing databases that were already 
electronic. These printing databases also form the basis of 
other Internet services, like THOMAS. Our system is used by the 
public to retrieve more than 8.5 million documents per month.
    The law also requires us to ``operate an electronic storage 
facility for Federal electronic information to which online access is 
made available.'' Following this mandate, GPO now makesover 70 
databases and other applications available to the public through the 
Internet without charge. We have served a number of agencies by 
developing and making available through GPO Access electronic products 
and services on a reimbursable basis. These ``sponsored'' Federal 
electronic information products include GAO Reports and Comptroller 
General Decisions, Government Information Locator Service (GILS) 
databases for 29 Federal agencies, and 12 Federal agency Web sites. In 
addition, GPO Access links users to thousands of Government information 
products made available on other sites. The service has received 
numerous awards from both the public and the private sectors.
    Question. Taking all federal subsidies into account, 
describe how GPO's costs, prices, quality and turnaround 
compare with comparable services available in the private 
sector.
    Response. The costs, prices, quality, turnaround, and 
related services for the 75% of our work that is procured come 
straight out of the private sector. GPO's prices for procured 
work are the competitive market prices plus a nominal 
surcharge. This surcharge covers a broad range of GPO 
contracting, payment and billing, and related services. 
Printing industry sources have estimated that the cost of these 
services would at least double if provided individually by the 
agencies. GPO focuses in-plant operations on core products 
where we provide high levels of service, expertise, control, 
dependability and schedule flexibility to meet the changing 
needs of Congress. It is difficult to establish the 
comparability of these services with private sector offerings. 
Most observers have agreed that GPO in-plant resources are 
unique in the industry. The prices of publications offered 
through GPO's documents sales operation are overall less 
expensive than those of comparable publications in the private 
sector.
    Question. By what standard is the GPO holding itself 
accountable?
    Response. In addition to compliance with applicable Federal 
laws and regulations, GPO is held accountable to a number of 
standards. Our financial statements are audited regularly by 
the General Accounting Office (GAO), and we have consistently 
received clean opinions. The GAO is currently conducting a 
management audit of GPO at the request of Congress, as it has 
periodically in the past, and we are cooperating fully. We have 
a statutory Inspector General assisted by an Audits and 
Investigations staff, and our other functions, from the Office 
of the General Counsel to Personnel, to Procurement and other 
operations, are accountable to professional criteria 
established for the respective operations. We have established 
several key performance measures in our operations related to 
timeliness, quality, overtime utilization, and related 
measures, and we establish and monitor goals for meeting these 
requirements. We hold ourselves accountable on the basis of the 
service provided to our customers.
    Question. Outside witnesses have testified in support of Congress 
printing and distributing additional copies of the bound Congressional 
Record and the U.S. Congressional Serial Set. As I understand it, the 
Serial Set is printed usually some eight years after the Congress is 
completed. Furthermore, it duplicates the bound Congressional Record 
and other documents distributed under the FDLP. Describe for me the 
usual schedule for printing and distributing the Serial Set,including 
quantities, and printing and distribution costs, and to what extent the 
Serial Set duplicates documents already distributed to federal 
depository libraries.
    Response. The U.S. Congressional Serial Set, a permanent 
record of the Senate and the House of Representatives, has been 
produced since 1813 in bound, numbered editions. It consists of 
all House and Senate Documents (including Senate Treaty 
Documents) and Reports (including Senate Executive Reports) for 
an entire Congress. The Serial Set does not duplicate the bound 
Congressional Record, which is a separate publication 
altogether.
    Approximately 55-65 bound volumes per session make up a 
Serial Set, depending on the Congress. These volumes are 
collated and bound beginning about 3-4 years after the end of 
the session, because it often takes that long for all of the 
Reports to be released by the committees and printed. The 
Serial Set is not intended to be immediately available, but is 
devised as an orderly means of preservation of the large number 
of numbered documents and reports issued by the Congress in 
individual paper format at the time they are filed.
    The bound volumes are made up from additional copies of the 
``slip'' Reports and Documents which were printed with the 
initial runs, and then put into storage at GPO pending binding. 
The slip versions are available to depository libraries at the 
time of initial production, and may be selected in either paper 
or microfiche format. Timely receipt of the slip Reports and 
Documents is essential to depository libraries that must 
respond to users' inquiries about current activities in 
Congress. However, depositories value the bound Serial Set very 
highly, both as an historical resource and because it ensures 
them of having a complete set of all of the Reports and 
Documents in their collections, thus allowing the libraries to 
provide permanent access to the work of Congress to their 
users. From the perspective of the legal and research 
communities, the Serial Set volumes are important historical 
resources, particularly for the compilation of legislative 
histories needed to determine legislative intent in 
interpreting Federal statutes.
    All volumes through the 104th Congress, 1st Session, are 
currently in GPO's bindery. At this time, the bindery is 
working on the Serial Set for the 103rd Congress, 1st Session. 
Staff shortages have contributed to the current status of 
progress in eliminating the backlog on Serial Set binding work. 
The total binding count for the bound Serial Set through the 
104th Congress has been running about 450 copies per volume and 
approximately 125 volumes per Congress. However, effective with 
the 105th Congress, the number will be reduced to approximately 
105 copies per volume, at a cost of about $440,000 per session 
of Congress.
    Question. The availability of information electronically 
via the Internet, and also on CD-ROM, has brought tremendous 
amounts of useful data within reach of the average citizen--
information that historically took a long time to compile, 
publish on paper, and make accessible. CD-ROMs are also very 
inexpensive to produce and to reproduce. However, testimony 
also described how data on CD-ROMs deteriorates. Is it not 
possible to simply reproduce existing CD-ROMs on a scheduled 
basis, to ensure data integrity over time?
    Response. Since there is no known medium or software 
environment currently available that assures the permanent 
accessibility of electronic publications, the task for 
librarians and other collection managers is to assure that 
electronic collections are compatible with currently available 
hardware/software configurations. Consequently, data migration 
should be an essential part of every library's electronic 
collection management plan. GPO's plan for the Federal 
Depository Library Program electronic collection will include a 
process for migrating electronic publications to maintain their 
utility throughout the Depository system. This process will 
incorporate checks for degradation of physical media and for 
loss of software compatibility. Concern for software utility 
will extend beyond the operating system issue to include checks 
for the utility of any search-and-retrieval software included 
on the CD-ROM, as well as the possible need to refresh the data 
conveyed on the disc to ensure continued compatibility with 
current computing environments.

    Mr. Cunningham. Do you have anything?

                   TRANSITION TO ELECTRONIC DOCUMEMTS

    Mr. Serrano. Sure.
    Mr. Serrano. Just very briefly, thank you for coming before 
us. I know that a couple years ago this committee asked that 
you conduct a study on moving into the electronic age, and I 
know throughout libraries in the Nation, people are moving in 
that direction, but there are some problems with it. Yesterday 
or the day before, we had Library of Congress folks tell us 
here that CD-ROM is a transitional technology. Could you just 
in general terms tell us how that is going, where are you 
heading, what problems are you running into, and what do you 
see for the future?
    Mr. DiMario. In general, the transition is going quite 
well. As you are aware, in setting up our transition plan, we 
involved the various elements of government, committees of 
Congress, and the library community. Initially this 
Subcommittee wanted us to have a 2-year transition to a fully 
electronic Depository Library Program. After consultation with 
people in the library community, and with the agencies of 
government, we recommended that it be a 5- to 7-year 
transition, which we felt was more feasible. That transition is 
actually taking place quite well.
    In terms of permanency of documents, we see that as a major 
issue. We are entering into partnership agreements with a 
variety of outside activities. As an example, the University of 
Illinois at Chicago has entered into an agreement with us and 
with the State Department, and they act to manage a portion of 
what we are now dealing with as a collection. The whole 
electronic activity within the depository program, is being 
viewed as a collection and we are entering into these 
agreements. We have entered into a number of others.
    There is the sense in the community that we have to keep an 
eye on posterity and long-term retention. There is a problem 
out there with electronic products. CD-ROMs are transitional, 
as you point out. No one knows what the ultimate technology 
will be. That means for certain kinds of documents you will 
have to replicate them from time to time into new technology, 
whereas in paper we are pretty well assured of the permanency 
of the document, so long as it is put on permanent paper. So we 
have identified certain documents within our plan that we 
called core products that we believe need to be retained in 
paper. We do produce those in paper to the extent that the 
agency's requisition is done that way. So we are working with 
the agencies. We are working with the National Archives. It is 
a lengthy answer to your question.
    Mr. Serrano. One of the things to keep in mind as you move 
ahead--I mean, you have two responsibilities. One is to get 
this done and to do what government does, and the other thing 
is that a lot of your information goes out to the public. And, 
you know, I represent a district in the Bronx that is called 
the poorest or sometimes the second poorest district in the 
Nation. That manifests itself in different ways. One is the 
lack of computers at home, low use of e-mail and Web pages, few 
computers in the classrooms and in libraries. So on one hand, I 
use this technology on a daily basis, but on the other hand, I 
am terrified that as we try to give out information to all 
communities, it won't get to all because certain communities 
got left behind in this age of technology.
    Now I know the solution--send more computers into the 
schools and homes--but that is not going to happen for now. So 
I need for all of you, as you move ahead, to keep that in mind, 
how we need to compensate for that.
    Mr. DiMario. We share your concerns, and one reason I 
appointed Mr. Buckley is to make him a spokesman for public 
access, and with his background, coming out of the Detroit 
Public Library, I am certain he has some of the experience, in 
terms of the users, that you would share.
    Mr. Serrano. I am sure Detroit was a problem, right, the 
Tale of Two Cities, in terms of the computer world.
    Mr. Buckley. That is why the depository program, which 
makes the information available in every congressional district 
is effective, because it is providing an avenue for people to 
have access, no matter their economic status. We have people of 
low economic status accessing that government information in 
Detroit and people of very high economic status accessing the 
same thing in the Shaker Heights Library because we have the 
equipment and people who can assist them in finding the 
information they want.
    Mr. Serrano. Thank you. I have no further questions.
    Mr. Walsh [presiding]. Mr. Fazio.

                       document management system

    Mr. Fazio. Mr. Chairman, thank you.
    It is good to see you all. Last year we were concerned 
about how you were working with the interface, with the Clerk's 
document management system. Could you give us a little update 
as to how that project is proceeding, the level of 
consultation, what sort of recommendations you have made, 
whether or not they are being looked at seriously?
    Mr. DiMario. At the request of the Chairman of this 
Subcommittee last year, I immediately, after the hearing, had a 
meeting with the Clerk of the House, and with the Acting Chief 
Administrative Officer at the time. We sat down and found that 
their interest was different from ours, they expressed that 
they were different, and we agreed to work together.
    What we were doing was really an external kind of work. We 
were going to be serving the public by continuing to provide an 
external interface while they were working to develop a better 
House information system, and so we agreed,generally, to work 
together. We have continued that. Our people have been participating in 
an ongoing study with the House and the Senate on Standard Generalized 
Markup Language, or SGML, because everyone has agreed to move to an 
SGML-based system and to work towards the systems that work together.
    We think that participation has certainly allowed us a 
voice. We are still concerned about what our role will be in 
the future. That has not been defined absolutely, and we still 
have some concerns. Some of the studies, as we have seen them, 
seem to have expressed the view that our SGML-based system is 
more advanced than everyone else's, and for that reason it may 
not be appropriate for uses on the Hill. We just hope that 
there is not short-sightedness in that view, and that when 
products are produced on the Hill, they need to be readily 
available so we can put them up and make them available to the 
public on our GPO Access system. So we are still concerned 
about that, and it is an ongoing study, but we hope that 
resolves itself well.
    Mr. Fazio. In the general area of legislative information 
systems, are you getting consulted; are you part of the 
process?
    Mr. DiMario. We do have people who we send up to 
participate in the process. In terms of being consulted, some 
of our people have expressed the view that they are simply 
called upon to tell them what we are doing, but they are really 
not in the deliberative process. And that has come back to me 
on several occasions, that we are participants, but we are not 
full participants.
    Mr. Fazio. In other words, your concerns, your viewpoints 
aren't necessarily adhered to or given credence; you are simply 
asked to talk about what you are doing?
    Mr. DiMario. Exactly.
    Mr. Fazio. Which is an informational point, but there seems 
to continue to be competition.
    Mr. DiMario. There seems to be, yes.
    Mr. Fazio. I think this is an area this committee needs to 
continue to look at. Perhaps we can do it, for all the parties 
involved.

                       bound congressional record

    Mr. Fazio. There has been a lot of concern, perhaps it 
would be less for Mr. Buckley, on the part of the depository 
libraries when this committee directed reductions in the bound 
Congressional Record, the congressional series sets. What sort 
of feedback are we getting from those decisions? You mention in 
your testimony that you surveyed the depository libraries to 
get some information back. How are they responding?
    Mr. DiMario. Basically with respect to the bound Record, we 
have had input both directly to GPO and I believe to the Joint 
Committee on Printing that there was still a desire for paper 
products out there, though we have been able to reduce the 
number of paper products dramatically. Through the Joint 
Committee's efforts, they sat down and went through the 
distribution lists that were being made, and came up with a 
reduction that would have us produce about 200 sets a year. 
That would allow distribution to the regional libraries and to 
each State that does not have a regional. It would also allow 
us to continue paper products in international exchange and 
provide certain products to certain offices on the Hill where 
the need for permanency is greater. That would also allow us to 
have a substantial reduction in the expenditure for the bound 
Record. But in order to accomplish this, we still are 
requesting that we be authorized to spend about $213,000 more 
than the $100,000 that was previously allowed to us. That is 
part of our request in here. We do have that money, but we 
would ask for permission to spend it.
    Mr. Fazio. You think it has generally been a success but 
you thought we were a little restrictive on the funds 
available, so working with the Joint Committee on Printing, you 
think you have found the right level?
    Mr. DiMario. I think so. Moreover, we are moving toward 
production of the bound Record in a different way, so we end up 
doing it as an on-demand product. We are moving to produce it 
on the Docutech. We asked the Joint Committee to authorize the 
acquisition of a second Docutech. They have done so. We are in 
the process of acquiring that now and it is for the express 
purpose of producing the bound Record. We could produce it as a 
much more economical document. So we think that is part of the 
savings.

                     department of defense printing

    Mr. Fazio. Can you give us an update as to our ongoing 
battle with DOD on their efforts to take work directly to the 
Defense Printing Service that might otherwise have been 
performed by GPO? What kind of impact is that having on your 
income flow, your cash flow?
    Mr. DiMario. That battle is ongoing. The decision coming 
out from the Justice Department in terms of an opinionat the 
Office of Legal Counsel essentially said that the current provisions of 
title 44 are not binding on the executive branch with respect to 
mandating that they have to come through GPO. We are in disagreement on 
that particular provision.
    The executive branch, especially in the Department of 
Defense, has continued a progression away from us. Our current 
problem with the Department of Defense seems to be more along 
the lines of not paying us for work that we are doing. They owe 
us a substantial amount of money. We outline that in the 
statement. That sum of money has grown substantially since the 
Defense Printing Service took over for the Department of 
Defense as a central manager, whereas before when each of the 
agencies came directly to us, we always had some lag time in 
payments, simply because of the way the system works, over 60-
day, over 90-day kinds of things, but that has grown very 
substantially. We are concerned because it affects our cash 
flow. It impacts the revolving fund on a regular basis.
    Mr. Fazio. Have you included in your submission to us what 
the arrearagement is at this point, how far behind they are, 
what the amount is?
    Mr. DiMario. I think it is in there.
    Mr. Guy. They owe us a total of about $50 million, half of 
which is over 60 days as of December 31.
    Mr. Fazio. Duke, are you on that Defense Subcommittee?
    Mr. Cunningham. Yes.
    Mr. Fazio. This is an area where maybe you should spend 
some time with Mr. Cunningham. Maybe he could help us resolve 
these issues between the subcommittees. Thank you very much.
    Mr. Walsh. Mr. Hoyer, I know, has to leave fairly quickly. 
Why don't you go ahead with your questions so you can get 
through?
    [Questions from Chairman Walsh and responses follow:]

    Question. Congressional printing has decreased over the past three 
years, has it not? By how much?
    Response. The number of original pages of all publications 
decreased from 757,000 in FY 95 to 611,000 in FY 97, a reduction of 
about 19 percent. Also, the number of copies printed of congressional 
publications has generally declined, largely as a result of efforts by 
this committee to reduce distributions. The number of copy/pages 
printed declined from 1.9 billion in FY 95 to 1.3 billion on FY 97.
    Question. You are down to printing 9,160 copies of the 
Congressional Record each day. How far has that dropped?
    Response. It has dropped from 16,935 in 1995 to 9,160 today, a 
reduction of about 7,775, or about 46%
    Question. About 4,970 of those copies are charged to the 
Congressional printing appropriation. How far has that dropped?
    Response. This number has dropped by about 6,549 copies from 1995, 
going from 11,519 to 4,970, a reduction of about 57%.
    Question. House Members no longer are able to charge this 
appropriation for sending copies to constituents. How much has this 
saved?
    Response. About 5,466 copies have been cut, saving about $1.2 
million per year.
    Question. Senators are still able to send to their constituents. 
How many are they allowed to send? How many are actually sent? At what 
cost?
    Response. Senators are authorized to distribute 37 each to public 
agencies or institutions, or a total 3,700. They are actually 
distributing about 1,995 in total. The cost is about $400,000 per year.
    Question. The cost of Congressional details (at $43 per hour) is 
$1.8 million. How much of that is for details to the House and how much 
for the Senate?
    Response. The appropriation request for Congressional printing 
includes $400,000 for details to the House and $1.4 million for details 
to the Senate.
    Question. The House reimburses the GPO for details to House 
committees. Does the Senate do the same? How much is charged to this 
appropriation for details to House and Senate committees?
    Response. Beginning in FY 95, House committees reimburse GPO for 
the cost of details, which amounted to about $1 million last year. 
Therefore, nothing is included in the Congressional Printing and 
Binding Appropriation for GPO details to House committees. For details 
to Senate committees, $1.4 millions included in the Congressional 
Printing and Binding Appropriation.
    Question. In FY 1997, there was a charge of $18,838,000 for 
``by-law'' printing. Explain this ``by-law'' distribution. Why 
is it charged to Congressional printing?
    Response. This category is used for printing and related 
services for the use of the Congress generally, rather than for 
a specific committee. Examples are the Congressional Directory 
and bills. This is not the By Law Distribution Program under 
the Superintendent of Documents, which pays for the cost of 
distributing certain publications at no charge to the 
recipient.
    Question. Why is there a charge to the Speaker for the 
daily Congressional Record? That seems like the charge for all 
copies sent to the House for its daily business. Should that 
billing be changed to a more appropriate account?
    Response. This cost is for the entire House and is not 
solely related to the Speaker. The same billing address has 
been used since 1966 and is charged to the Congressional 
Printing and Binding Appropriation. A broader title, House of 
Representatives, has been used in the past and is more 
descriptive. We are changing the title of this account.
    Question. For several years, GPO added a surcharge to this 
appropriation which drew down any surpluses that had 
accumulated due to reductions in Congressional printing. Was 
there a drawdown last year? Do you plan one against the 1998 
appropriation?
    Response. The billing rates used during FY 97 were too low 
to recover total costs because the volume was below estimates. 
At the end of the year, it was necessary to charge an 
additional $6 million to the Congressional Printing and Binding 
appropriation in order to fully recover costs strictly 
associated with Congressional work. We do not anticipate any 
such adjustments in FY 98. Rates are intended to recover cost 
and adjustments are only made if necessary to achieve that 
result.
    Question. Since there is no comparable surcharge against 
executive agencies, we charged a comparable amount against the 
revolving fund assets in the 1998 appropriation bill. That 
allowed us to reduce the actual appropriation by $11 million. 
So although your budget is up only $3.5 million, you are really 
requesting an increase of $14.5 million in appropriations 
funding. The reason for these surcharges is that you are not 
recovering costs. What are you doing to alleviate that 
situation?
    Response. We will adjust rates to reflect cost more 
frequently, up or down as necessary. We are also taking action 
aimed at reducing costs and increasing efficiency through 
attrition, reassignment, training, capital investment, and 
process improvement. In order to avoid any unnecessary 
depletion of the revolving fund, it may be advisable to amend 
the FY 98 language requiring the transfer of $11 million from 
the revolving fund to the Congressional printing appropriation 
to authorize the transfer to the extent necessary, not to 
exceed $11 million.
    Question. One of the solutions GPO seems to be applying to 
increasing financial losses caused by reductions in demand for 
printed products is to raise prices. Doesn't that just drive 
more customers away?
    Response. Cost is always a concern. However, GPO focuses 
in-plant operations on core products where we provide high 
levels of service, expertise, control, dependability and 
schedule flexibility to meet the changing needs of Congress. 
Also, it is good economics for the Government to utilize plant 
capacity that may be available at GPO.
    Question. How much has the workload declined over the past 
3-5 years? Where have you reduced costs to compensate for this 
reduction?
    Response. Plant workload, measured in chargeable hours, 
declined by about 37% from FY 93 to FY 97. Total Plant costs 
declined by about 15%, but this percentage decline in costs 
would be much greater if adjusted for inflation to reflect 
reduced real purchasing power. Total Plant expenses declined 
from $215.4 million in FY 93 to $183.6 million in FY 97. We 
have reduced staffing, closed five Regional Printing Offices, 
and reduced warehouse and industrial space requirements. We are 
investing in more productive technology, such as computer-to-
plate systems. We are facilitating the use of standardized 
electronic formats, expanding print-on-demand services, 
providing improved online services and improved CD-ROM 
products. Staffing in the plant decreased by about 26 percent 
from FY 93 to FY 97.
    Question. Does your 1999 request assume another rate 
increase for congressional printing? How much?
    Response. Yes, rate increases in the 1999 request total 
$3.9 million, or 4.8%. This is partially offset by volume 
decreases on $1.6 million, or 1.9%.
    Question. Outline the history of rate increases for the 
past 4-5 years. How does that compare with plant losses? How 
does that compare with staffing reduction?
    Response. Outline of rate increases:
    Rates were frozen from December 1990 to January 1996.
    FY 96-Rates were increased by an average of about 10 
percent.
    FY 97-Rates were increased by an average of about 13 
percent.
    FY 98-Rates were increased by an average of about 5 
percent.
    Since 1996, rates have increased by about 28 percent, which 
really covers an 8-year period. Cumulative losses over the past 
five years total $49.3 million, inclusive of net income 
reported on a preliminary basis for FY 97. All of these losses 
were funded by retained earnings in the revolving fund. There 
has been no deficiency. Over the past five years, total GPO 
staffing declined by about 25 percent.
    Question. Mr. Buckley, we have been told there will be 
legislation that will be enacted to bring your authority up to 
date. The revision of Title 44 includes some large changes to 
the depository library program. Can you outline these for us?
    Response. Following hearings on Title 44 revision in the 
spring of 1997, and at the request of the Senate Rules and 
Administration Committee, we submitted draft legislative 
language that would, among other things, modernize the 
depository library program. Our draft bill would: Create new 
definitions of ``government information'' to specifically 
include electronic formats and prevent restrictions on public 
access to public domain information; Set up a system of 
electronic public access to government information coordinated 
by the Superintendent of Documents; Combat fugitive documents 
by broadening the kinds of information going into the 
depository library program, including eliminating the exemption 
on ``cooperative publications; Modernize language covering 
statutory designations of depositories, inspection 
requirements, and cataloging and locator services; and Provide 
for permanent public access to electronic information.
    Other parts of our draft bill would transfer administrative 
responsibilities of the Joint Committee on Printing to the 
Public Printer to remedy any issue about separation of powers, 
would modernize and streamline GPO's procurement and sales 
authorities, and would eliminate certain outdated provisions of 
the law.
    Apart from our draft bill, the only other legislative 
proposal we have seen is draft language to revise chapter 19 of 
Title 44, governing the depository library program, which has 
been advanced by the Inter-Association Working Group on 
Government Information Policy (IAWG). The IAWG is composed of 
representatives of the various associations in the library 
community. We have had discussions with them about the language 
they have proposed and at the current time we are seeking to 
work with them to produce language on which we can jointly 
agree. Otherwise, as of the date of the hearing before this 
Subcommittee, we have not seen any other legislative proposals 
to revise Title 44.
    Question. Are you supportive of these changes?
    Response. As a general rule, we are supportive of 
legislative changes that will modernize the depository program 
and improve public access to Government information. However, 
we cannot state support for proposals to revise Title 44, other 
than the draft language we have submitted to the Senate Rules 
and Administration Committee, until we have had the opportunity 
to study specific proposed legislative language.
    Question. Mr. DiMario, what is your position on the 
amendments to Title 44 currently under discussion?
    Response: We are supportive of the language we submitted to 
the Senate Rules and Administration Committee. We can take no 
position on any other legislative proposals to revise Title 44 
until we see them and have the opportunity to study them.
    Question. Is there any indication that the authorizing 
committees will take up this matter?
    Response. We have heard statements that Title 44 reform 
will be taken up in this session of Congress. However, we are 
not aware that any bill has been introduced nor do we have 
knowledge that any draft bill may be approaching introduction. 
Given the importance of public access to Government information 
and the potential costs and budget impact that may be involved 
in any reform of Title 44, we hope there will be hearings on 
any Title 44 reform legislation.

                                capacity

    Mr. Hoyer. Thank you very much. I will submit the balance 
of my questions that I don't get an opportunity to ask.
    Mr. DiMario, with the downsizing you have been undergoing, 
are you able to maintain basic capacity to produce the 
Congressional Record?
    Mr. DiMario. We are at the moment but we are really afraid 
of the future. Part of our ability to maintain the downsizing 
has been only because Congress has been producing less work.
    Mr. Walsh. Less paper.
    Mr. DiMario. Less paper. Less paper coming through us, yes.
    Mr. Walsh. Excuse me for interrupting.
    Mr. DiMario. The number of days that Congress is in 
session, the number of issues of the Congressional Record.Those 
all have an impact on the amount of work we do.
    Mr. Serrano. You are touching on dangerous, sensitive 
subjects.
    Mr. DiMario. The point is that we have shrunk our 
production department down to roughly 1,330 employees. That is 
a dramatic reduction in the production area. These are the 
folks who produce the congressional products. I am afraid that 
if we do any more shrinking in there, we are going to be in a 
serious problem.
    We talked about the bound Congressional Record and delays 
in it, why it takes so long to get these products done. 
Currently, all the printing on the bound Record is completed 
through 1995 in terms of press work, except for certain index 
products. But they are backed up in the bindery. We don't have 
adequate numbers of people in the bindery to complete the work 
and get it out the door. We are doing our best to change that 
schedule and moving towards the additional Docutech equipment 
will certainly help us along. But we definitely cannot take an 
additional cut in our staff.
    Mr. Hoyer. You indicate in the last paragraph of your 
statement about asking for the statutory limit on FTEs to be 
lifted, not to ask for more money, but would you explain how 
you try to manage and what objectives you are going to try to 
reach?
    Mr. DiMario. We are continuing to do cost cutting 
internally within GPO. If the statutory ceiling is lifted, we 
will continue to try to reduce staff in GPO. We may end up with 
more balance. We may be able to hire in areas that we need to 
hire in. Whereas the statutory ceiling will not allow us to do 
overhires at times when we need them. If we have excess work, 
we may want, as an example, to be able to hire more people on a 
temporary basis to bring them in to accomplish that work, if 
that is possible.
    Mr. Hoyer. So that one solution might be to do an exemption 
for temporaries from the cap? That would help?
    Mr. DiMario. That would help a great deal.
    Mr. Hoyer. It is not where you want to get to but----
    Mr. DiMario. That would help a great deal. But the cap 
itself is an impediment. We certainly are continuing to reduce 
employment.
    As I indicated, with the number of people who are actually 
onboard today, we are not trying to just deal with that 
statutory cap as a level to maintain. We are continuing to try 
to reduce and to manage the cost downward.

                                 RATES

    Mr. Hoyer. When Congress doesn't order the amount of work 
that you anticipate, how does that affect your rates?
    Mr. DiMario. In order to recover our costs, with fixed 
costs, we still have to raise the rates. That is the only way 
we can get that money back that we are expending. Congress 
appropriates the money, but we need to be able to reach that 
appropriation, and the way we have to do it is to raise the 
rates on products. We will raise rates, and we are doing that. 
We raise them, we lower them, depending on how much money we 
need. But that is in order to reach the appropriation that you 
are giving us.
    Mr. Hoyer. In other words, in order to maintain the service 
for Congress, you have got to maintain the ability to perform 
the service?
    Mr. DiMario. Yes, sir.
    Mr. Hoyer. But if Congress doesn't make it a high demand, 
your per-document cost obviously goes up?
    Mr. DiMario. Right. If Congress did not work at all, and 
assuming all of our people were still employed, we would still 
expend all of that money internally. But we could not get it 
out of the appropriation that we had.
    Mr. Hoyer. The answer would be to reduce those costs by 
eliminating personnel and then you would not have the capacity 
to respond to Congress' needs?
    Mr. DiMario. That is right.
    Mr. Hoyer. Am I correct that historically Congress has not 
paid its full bill? I don't mean by not paying but not being 
billed for the cost?
    Mr. DiMario. That was true between 1990 and 1996. We had 
our rates frozen. Since 1996, we have been adjusting our rates 
and have incrementally increased the rates so that currently we 
are covering more. What we need to do is continue to adjust 
those rates on a periodic basis.
    Mr. Hoyer. Are you recovering what you would as a business 
if you were operating as a business? Are you pricing your 
product to Congress as you would price it for a business, cost 
plus profit? Obviously take profit out because you are 
subsidized so that is your profit, in effect.
    Mr. DiMario. We are pricing the products--Bill might speak 
to this better than I. We are pricing our products to Congress 
based on our costs. It is a pure cost recovery system. Our 
rates are designed to recover our full costs. They are not 
designed to do anything else. It is the only way we get to 
reach the money that is appropriated.
    Mr. Guy. It is a cost-based system. I am not sure how 
analagous it is to a private sector firm working for profit, 
which may have some additional marketing type issues, as well 
as supply and demand considerations, which may impact price 
setting, but by law we are on a cost-reimbursement basis.
    Mr. Hoyer. The last question, and I will submit the balance 
for the record, I have got quite a few questions, including 
about the revolving fund, we have had testimony in the House 
Oversight Committee on that. I know you have had testimony on 
it here. It is a pretty complicated operation. Do you have any 
recommendations on a way to improve this so that it could 
bebetter understood?
    Mr. DiMario. My recommendation has been over a substantial 
period of time to put us on a salaries and expense 
appropriation, similar to our Superintendent of Documents. Give 
us the appropriation that Congress is giving us and expect that 
we will perform the work that Congress sends us within that 
appropriation. If we, for whatever reason, find that we cannot 
do the work within that appropriation, then we have to come 
back to you and ask for a supplemental and we would have to 
identify the reasons why. But right now you are giving us the 
money based on our estimates of what the work will be, and you 
appropriate the money but then if we guess wrong, if the work 
doesn't materialize, then we have difficulty funding ourselves. 
So we need to be able to close that gap some way. My only 
solution is a salaries and expense appropriation, like every 
other agency.
    [Questions from Mr. Hoyer and responses follow:]

    Question: This year Congress is making you fund part of 
Congressional printing out of your resolving fund rather than 
appropriating the money to you. Can your revolving fund take on 
that additional burden? Could you do this on a continuing 
basis?
    Response. Our assessment is that the fund can take on the 
additional burden for FY 98 only. This is based on the 
assumption that no unforeseen financial requirements arise, 
such as major operating losses, unplanned major repairs and 
maintenance, extraordinary work requirements, or deterioration 
in the prompt payment of customers bills. The fund is not 
capable of permanently subsidizing the cost of customer 
requirements on a continuing basis because the fund would 
become insolvent. The fund is designed to provide temporary 
financing of customer work requirements pending reimbursement. 
In the long run, the fund depends on revenue from customers to 
reimburse costs incurred. In addition, the fund must have 
sufficient cash flow to finance necessary capital expenditures. 
The $11 million transfer will significantly reduce resources 
that would otherwise have been available for these purposes.
    Question. What are the demands on your revolving fund for 
improvements to your equipment and buildings? For example, how 
are you going to fund bringing your computers into compliance 
with year 2000 requirements?
    Response. Capital expenditures for major building repairs 
and maintenance, information systems, and production equipment 
will be a considerable drain on the revolving fund. GPO 
buildings are old and require substantial maintenance. These 
services are not provided by the Architect of the Capital, but 
are financed by GPO. Over the next two years, necessary capital 
investments include about $6 million for replacement of air 
conditioning equipment. Elevator, roof, and electrical systems 
need repair, which will cost additional millions of dollars 
over the next few years. Information systems also account for 
major capital investment requirements. This year we will be 
implementing an information processing system for the 
Superintendent of Documents, at a cost of about $10 million. We 
will replace the mainframe computer with an enterprise server 
that will be year 2000 compliant, at a cost of about $1.8 
million. Other significant expenditures will be required to 
bring all GPO computers and software into compliance with year 
2000 requirements. Production equipment requirements include 
$1.6 million for computer-to-plate systems and $3.6 million for 
a passport printing and binding line.
    Question. Two years ago Congress declined to directly fund 
your request for building improvements for air conditioning and 
elevators and other items. Are these systems still in need of 
repair? How will you fund the improvements?
    Response. In FY 96, GPO requested an appropriation of $15.4 
million for renovation of building structures and building 
systems, including air-conditioning, electrical and elevator 
systems. These systems are still in need of repair. These 
improvements will have to be funded through the revolving fund, 
unless a direct appropriation is made to GPO for these 
purposes. In 1971, 1972, and 1974 Congress appropriated a total 
of $12.9 million for GPO air conditioning and electrical 
systems. These systems currently need to be replaced or 
repaired.
    Question. Your statement says you are having difficulty 
recovering payments from DOD. How is this affecting your cash 
position, your ability to pay your bills?
    Response. The DOD slow payment problem is having a serious 
effect on GPO's cash balance. GPO pays printing contractors for 
performing DOD work, but DOD is not reimbursing GPO in a timely 
manner. This seriously reduces revolving fund cash.
    Question. You are currently being audited by Booz-Allen & 
Hamilton, under contract with the GAO. How much is that audit 
costing? Who pays for it?
    Response. The cost of the study is not finally determined, 
but $1.5 million has been authorized for this purpose. GAO has 
transferred $1.5 million from the GPO revolving fund into GAO's 
appropriation account to pay for this study.
    Question. Your statement says you are having difficulty 
recovering overpayments to the Labor Department for the Workers 
Compensation Program. Can this committee help with this?
    Response. Any assistance from the committee would be 
greatly appreciated. We were advised by the GAO Office of 
General Counsel, in a letter to the Public Printer, dated 
September 23, 1997, to consider advising the Joint Committee on 
Printing and the appropriate subcommittees of the Senate and 
House Appropriations Committees of this dilemma, and seeking 
the transfer of funds to the GPO revolving fund from OWCP's 
current or expired accounts.
    Question. Your statement says the increased cost of 
congressional printing is attributable in part to wage 
increases. Are the wages covered by a contract? Did the Joint 
Committee on Printing approve the contract?
    Response. Yes, the increased wages are part of collective 
bargaining agreements approved by the Joint Committee on 
Printing.
    Question. When Congress requires you to provide a 
particular function, like your office of the Inspector General, 
which is required by law, how is that function paid for? Do we 
pay for it through your rates for printing?
    Response. Yes, all such mandatory functions to be performed 
by GPO represent costs for which direct appropriations are not 
provided. Therefore, the cost of providing these services must 
be recovered as additional overhead through the rates charged 
for printing and related services.
    Question. Just 2 years ago the JCP directed you to recover 
costs of work you produce, including congressional printing. 
Before then, how long did you go without any increase in rates? 
How did this affect your finances?
    Response. We went from 1990 to 1996 without any increase in 
hourly rates. During that period of time, the revolving fund 
lost $61.3 million, which was funded by reducing retained 
earnings.
    Question. Your appropriation for congressional printing has 
been declining in purchasing power over the years--twenty years 
ago it was the equivalent of $200 million per year, according 
to your budget submission. How have you accommodated this 
decline in purchasing power?
    Response. This decline in purchasing power has been 
accommodated by the implementation of productivity enhancing 
technology utilizing electronic photocomposition, digitized 
information, improved data processing and communications 
networks. This has increased the productivity of the workforce 
and allowed us to greatly reduce the staffing level while 
providing new and enhanced services.

    [Questions from Mr. Latham and responses follow:]

    Question. How much does it cost GPO to print hard copies of 
the Federal Register and the Congressional Record that are 
delivered daily to Members' offices?
    Response. The cost of printing all of the copies of the 
Federal Register which are delivered to Senators and 
Representatives offices is estimated to be about $679,000 
annually. The cost of printing all of the copies of the 
Congressional Record which are delivered to Senators and 
Representatives offices is estimated to be about $440,000 
annually.
    Question. Is there an option to not receive these copies? 
Isn't this exact information available on the Internet?
    Response. The Members have the option to not receive these 
copies. The same information is placed on the Internet by GPO 
at the same time we go to press with these publications.

    Mr. Walsh. If I could interrupt at this point, we are out 
of time on the clock, and we have not yet voted. We are going 
to have to adjourn the meeting. Thank you very much for your 
testimony.
    The hearing is adjourned.

    Question. For the record, insert all reprogramming 
documents submitted to and received from the Committee.
    Response. The information follows:

[Pages 698 - 699--The official Committee record contains additional material here.]


                                       Thursday, February 12, 1998.

                      JOINT COMMITTEE ON PRINTING

                                WITNESS

HON. BOB NEY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO
    Mr. Walsh. The subcommittee hearing will come to order.
    I would like to welcome my colleague, Mr. Hoyer, to the 
table, and also our former colleague, Mr. Orton. Good to have 
you with us this morning. Congressman Bob Ney will be here 
representing Chairman Senator Warner and Vice-Chairman Bill 
Thomas of the Joint Committee on Printing.
    We will now take up the Joint Committee on Printing. The 
budget request is $804,000, the same amount that was 
appropriated in the 1998 bill, so there was no increase. The 
budget is for a staff of 11 FTEs. We would like to welcome Mr. 
Ney. We also have Mr. Eric Peterson, the committee Staff 
Director. Welcome, Mr. Peterson.
    Mr. Chairman, is there anyone else you would like to 
introduce at this time?
    Mr. Ney. No. I just wanted to say I am here on behalf of 
Senator John Warner, Chairman of the Joint Committee on 
Printing, who is traveling in the Middle East with Secretary of 
Defense Cohen, and has been understandably and unavoidably 
extended. The Chairman requests his testimony be submitted and 
included in the record.
    Mr. Walsh. Without objection.
    [The information follows:]

[Pages 702 - 703--The official Committee record contains additional material here.]


    Mr. Ney. Also, if you would allow me to introduce Eric 
Peterson, the Joint Committee on Printing Staff Director, he 
will be available to answer questions. He actually knows a lot 
more than I do.
    Thank you, Mr. Chairman.
    Mr. Walsh. We will place the statement in the record.
    Are there any questions of the witness, Mr. Hoyer?
    Mr. Hoyer. I don't have any questions of Mr. Ney. I want to 
say that I serve on the House Oversight Committee with Mr. Ney, 
and he is a distinguished member and I enjoy working with him. 
Obviously, the Joint Committee on Printing, Mr. Chairman, has 
historically been critically important to the Congress in 
overseeing and ensuring the provision of documents to the 
Congress in a timely fashion, and overseeing how this historic 
agency is operating.
    Obviously there are going to be a lot of issues, coming up, 
perhaps not to be implemented this year, but in years ahead, 
dealing with Title 44. That really has not been an item for 
discussion and I don't think it would be particularly useful to 
pursue it at this point.
    Suffice it to say that on our side we see a continuing role 
for the Joint Committee on Printing. Obviously, the budget is 
not going to be an issue from what I see here. They ask for 
last year's appropriation.
    I will submit some questions, Mr. Chairman, for the record, 
so we can have the answers, which I think will be useful. I 
also look forward to sitting down with our Staff Director and 
perhaps discussing with him some of his thoughts and my 
concerns.
    As you may know, Mr. Chairman, I am the Democratic member 
on the Joint Committee representing the House, so I have a 
particular interest in this and will be pursuing it. But I 
don't think at this point in time I will do so, because there 
are no budget questions.
    Mr. Walsh. I will do the same. I will have some questions 
that I will submit for the record, and we will ask you to 
respond back on those as promptly as possible so we can proceed 
with considering the joint committee's budget. But it would 
seem that coming in at the same level as last year, that the 
budget at least won't be an issue. Thank you very much.
    [Questions from Chairman Walsh and reponses follow:]

    Question. Your request is for a level budget. But your statement 
implies that the revision of Title 44 will affect the future of the 
Joint Committee. Can you clarify that for us?
    Response. Revisions to Title 44 envision the elimination of the 
Joint Committee on Printing as the means to solving the separation of 
powers issue currently impeding the Government Printing Office's 
ability to effectively serve the printing and printing procurement 
needs of Executive and Judicial branch agencies.
    If enacted as currently proposed, the Title 44 revisions would take 
effect January 1, 1999.
    Question. How will this Title 44 revision help the Federal Printing 
Program?
    Response. The proposal will benefit the Federal Printing Program 
by:
          1). Resolving the conflict between the branches of the 
        Federal Government which hampers efficient production and 
        thwarts permanent access to the Federal Government's 
        publications;
          2). Guaranteeing the right of the public to access 
        publications produced by the Federal Government;
          3). Promoting public availability of Government information 
        in the electronic age through a Federal publications access 
        program that provides no-fee availability of all formats;
          4). Facilitating production and public access to Government 
        publications by the establishment of mechanisms that assure the 
        efficient and economical production of publications and an 
        effective and equitable system of dissemination.
    Question. The GPO continues to lose money on the in-house workload. 
We also understand that now they are beginning to lose on the 
procurement program. Their solution cannot be to raise prices to bring 
in more revenue because the agencies will just shop elsewhere for their 
printing needs. Do you see any solution to this problem?
    Response. The management analysis of the Government Printing Office 
currently being executed through the General Accounting Office and its 
contractor Booz-Allen & Hamilton will undoubtedly contain a number of 
very realistic and implementable recommendations to address this 
problem. There are basically, however, three fundamental issues at 
play. The first is that by law, the Public Printer is required to 
recover his costs. Therefore, the question must be asked, what are the 
costs of completing the in-house workload, and are they being fully 
recovered. GPO's year-end FY '97 financial statement suggests that the 
agency came very close to fully recovering its costs.
    Another of the fundamental issues is whether there is a more 
economical way of completing the in-house workload. To address that 
issue it is necessary to examine the nature of that workload, the time 
frames in which it is expected to be completed, and the quality of the 
raw material which must be processed in order to produce the end 
product.
    Presently, the overwhelming majority of GPO's in-house workload is 
Congressional printing and binding. This includes the Congressional 
Record and Index, bills, resolutions, calendars, and committee hearings 
and reports. This workload ebbs and flows depending on whether Congress 
is in session, and how busy the Congress is. In many respects, GPO is 
like a fire department which is required to maintain a certain level of 
capability whether there is a fire or not. GPO is expected to maintain 
a workforce and equipment to respond to the peak demands of Congress, 
even when Congress is not making peak demands. Perhaps there are more 
economical printing processes which GPO could employ to provide the 
same products. As technology evolves and is employed more widely on the 
Hill and at GPO, some of these more economical processes will become 
more practical to use.
    The final issue is whether there is some of the in-house workload 
which can be more economically produced by outsourcing. Committee 
reports, committee hearings, and a number of other publications 
currently produced in-house might well be produced more economically by 
outside printers, but those savings must be balanced against the costs 
of maintaining a certain in-house capability to meet Congress's peak 
demand. Here again, technology and the recommendations of the GAO 
management analysis may provide answers to this question.
    Ultimately, all of these considerations come down to recognizing 
that the Government Printing Office is a service provider, and as such, 
it must continue to develop and improve its ``doing business'' 
processes, and, despite those improvements, if Congress still feels 
it's too expensive, then Congress may have to change its expectations.
    Question. Would it make sense for the House and Senate to do their 
own printing with internal DocuTech machines or by direct outsourcing? 
Does your legislation get into that at all? Response. Clearly there are 
Congressional printing needs that can and are addressed with internal 
processes or through direct outsourcing. But at this time, and with 
present technology, it is difficult to envision the production of 
Congress's most important publication, the Congressional Record, being 
produced either internally by either or both Houses, or being 
outsourced.
    The revisions to Title 44 under consideration do direct the General 
Accounting Office to undertake a study of the feasibility of other 
legislative branch agencies outsourcing more of their printing needs. 
Based on this study, the Congress may wish to direct a similar study 
for itself.
    Question. The Appropriations Committees are the largest 
Congressional customers of GPO. The plant has been supporting the work 
of our Committee and subcommittees since the 1800's. We are a little 
concerned because we have not been briefed on this new legislation. I 
hope that is in the works because we want to be helpful. But I am sure 
you understand our reserving opinion until we learn more about the 
proposal.
    Response. I appreciate the Chairman's concern, and wish to assure 
him that when the proposal is ready, and members of the Senate Rules 
Committee give the green light, the language will be offered for review 
and comment.
    In my capacity as Chairman of the Senate Committee on Rules and 
Administration, I look forward to working with the Chairman and his 
Committee on this proposal.
    [Questions from Mr. Cunningham and responses follows:]

    Question. Have you discussed the specific language of your proposed 
Title 44 revision with the Public Printer? If not, when do you plan to?
    Response. The Committee staff has verbally outlined the various 
versions of Title 44 reform with the Public Printer as well as 
requested and received written proposals from the Public Printer.
    Out of deference to Senator Ford, however, the actual language of 
these proposals has not been provided the Public Printer for his review 
and comment. Rest assured, however, the Public Printer will be given 
such an opportunity before the proposal is formally introduced.
    Question. And how is electronic publishing regulated in regards to 
making it accessible to the American public?
    Response. The proposal deals with electronic publishing in the same 
manner it deals with ink on paper. Agencies have an affirmative 
responsibility to notify the Superintendent of Government publications 
and make their image files available. If agencies do not, then they 
bear the cost of meeting the Superintendent's requirements.
    Question. You state that you are working toward the day when there 
will be no Joint Committee on Printing. I assume that oversight of the 
Government Printing Office will then fall to the Senate Committee on 
Rules and Administration and the House Committee on House Oversight. . 
. . The Joint Committee on Printing was established in 1846 to assure 
that there is uniformity and standardization of printing between the 
House and Senate. . . . Without the ``referring'' of the JCP, who will 
meet this need for uniformity for the Congressional Record? Who will 
determine competing demands? Who will track down fugitive documents? 
Who will assure Agency compliance with the law?
    Response. The oversight of Congressional printing will become the 
responsibility of the House Committee on Oversight and the Senate 
Committee on Rules and Administration. The Clerk of the House and 
Secretary of the Senate will continue to have administrative 
responsibility to ensure timely and cost effective processing of 
material to be published on behalf of Congress. The Public Printer will 
be required to do all that is necessary to remedy neglect, daily, 
duplication or waste in public printing, and the Superintendent of 
Government Publications will be responsible for ensuring permanent 
public access to the Government's publications.
    Question. When the GPO was here, they raised the issue of delays in 
payment by the Department of Defense, which the GPO says is in arrears 
by as much as $52 million. What is the JCP doing to help GPO collect 
these funds?
    Response. While GPO has not formally raised this issue with the 
Joint Committee, or requested the Committee's assistance, the Joint 
Committee has taken the initiative of having discussions with the 
Department of Defense and GPO's Comptroller. The Committee understands 
from both parties that this arrears is attributable to one Defense 
Department installation, and that a mechanism is being installed to 
remedy this matter in the very near future.

    [Questions from Mr. Serrano and responses follow:]

    Question. Senator Warner, I am very interested in your stating that 
the proposal for Title 44 reform will be unveiled soon. This would be a 
major accomplishment. Who has been involved in the drafting of this 
proposal?
    Response. The staff of the Senate Rules Committee has consulted 
thus far with the Public Printer, the Superintendent of Documents, 
staff of the Office of Management and Budget, and representatives of 
the following organizations: American Library Association, American Law 
Libraries Association, Government Documents Roundtable, Information 
Industry Association, Printing Industries of America, National 
Archives, Library of Congress, Secretary of the Senate, Clerk of the 
House, and the Administrative Office of the Courts.
    The Committee also has held six hearings during the course of 1996 
and 1997, during which it received input from the following individuals 
and organizations:
    The Honorable Michael F. DiMario, Public Printer, Government 
Printing Office; Mr. George E. Lord, Chairman, Joint Council of Unions, 
Government Printing Office; Mr. William J. Boarman, President, 
Printing, Publishing and Media Workers Sector of Communications Workers 
of America; The Honorable Royce C. Lamberth, United States District 
Judge for the District of Columbia; The Honorable Sally Katzen, 
Administrator, Office of Information and Regulatory Affairs, Office of 
Management and Budget; Mr. Richard Shiffrin, Deputy Assistant Attorney 
General, Office of Legal Counsel, U.S. Department of Justice; Mr. 
Francis J. Buckley, Director, Shaker Heights Public Library; Mr. Ronald 
G. Dunn, President, Information Industry Association; Mr. Henry J. 
Gioia, Office of the Director of Administration and Management, Office 
of the Secretary of Defense; Mr. Gary R. Bachula, Deputy Under 
Secretary for Technology Administration, Department of Commerce; 
Governor John W. Carlin, Archivist of the United States; Ms. Joan 
Lippincott, Interim Executive Director, Coalition for Networked 
Information; Mr. Wayne P. Kelley, Superintendent of Documents, 
Government Printing Office; Mr. Daniel P. O'Mahony, Government 
Documents Coordinator, Brown University Library; Dr. Betty J. Turock, 
President, American Library Association; Dr. Christine D. Vernon, 
Yorktown, Virginia; Dr. William A. Wulf, Professor of Computer Science, 
University of Virginia; Dr. Dennis Galletta, Katz Graduate School of 
Business, University of Pittsburgh; Mr. Robert Smith, Executive 
Director, Interactive Services Association; The Honorable Jeanne Hurley 
Simon, Chairperson, U.S. National Commission on Libraries and 
Information Sciences; Dr. Lewis Bellardo, Deputy Archivist of the 
United States; Mr. Benjamin Cooper, Vice President, Government Affairs, 
Printing Industries of America; Mr. William A. Gindlesberger, 
President, ABC/Bids Plus; Mr. Robert G. Claitor, President, Claitor's 
Law Books and Publishing Division, Inc.; Mr. Eric Massant, Director, 
Government and Industry Affairs, LEXIS-NEXIS and Congressional 
Information Service, Inc.; Mr. Christopher Schroeder, Acting Assistant 
AttorneyGeneral, Department of Justice; Mr. Roy Francis, Chairman, 
Advisory Council to the Public Printer, Interagency Council on Printing 
and Publication Services. Department of the Interior; and Mr. Donald R. 
Johnson, Director, National Technical Information Service, Department 
of Commerce.
    Out of deference to the wishes of the Ranking Minority Member of 
the Senate Rules Committee, Senator Ford, public circulation of various 
iterations of Title 44 reform has been limited, as have discussions 
with our colleagues in the House.
    Question. Can you share with us the major themes and principles of 
this legislation?
    Response. The purposes of this bill are to:
          1). Resolve the conflict between the branches of the Federal 
        Government which hampers efficient production and thwarts 
        permanent access to the Federal Government's publications;
          2). Guarantee the right of the public to access publications 
        produced by the Federal Government;
          3). Promote public availability of Government information in 
        the electronic age through a Federal publications access 
        program that provides no-fee availability of all formats; and
          4). Facilitate production and public access to Government 
        publications by the establishment of mechanisms that assure the 
        efficient and economical production of publications and an 
        effective and equitable system of dissemination.
    Question. Do you have estimates of the costs and benefits of your 
Title 44 reform legislation? What impact will it have on the specific 
appropriations for Congressional Printing and Binding? On the Salaries 
and Expenses of the Superintendent of Documents?
    Response. At this point, with the proposal still in flux, it is 
difficult to give the Committee a realistic estimate. At a minimum, the 
cost of operations for the Joint Committee on Printing will be 
eliminated. Additionally, there will be greater accountability on the 
part of both the Congress and the Government Printing Office with 
regard to the amount of Congressional printing and binding work being 
done and its cost. As a result, Congress may alter its expectations and 
demands, and as a result produce additional cost savings.

    [Questions from Mr. Hoyer and responses follow:]

    Question. In the proposed legislation, what mechanism is in place 
for enforcement of Title 44?
    Response. There are several affirmative enforcement mechanisms 
contained in the latest version of Title 44 reform. In the case of non-
compliance there also are several remedial actions including cost 
recovery, which both the Superintendent of Government Publications and/
or the Public Printer may take.
    Question. Does the Senate Rules and Administration Committee plan 
to hold public hearings on Title 44 revision?
    Response. Yes, the Senate Rules Committee intends to hold a hearing 
on whatever proposal is introduced this Spring.
    Question. Many studies conducted by the GPO, the GAO and the former 
Office of Technology Assessment have said the GPO's centralized 
printing procurement program is the most cost effective way for the 
Government to procure printing. Would your planned revision of Title 44 
decentralize Federal printing? If so, what is your estimate of costs to 
the taxpayers?
    Response. The current proposal envisions a centralized mechanism 
for posting print procurement opportunities--regardless of whether the 
procurement is performed through GPO, or the agency seek the 
procurement directly. This mechanism will be maintained by the 
Government Printing Office.
    Under current Title 44, as well as the revisions under 
consideration, the Public Printer has and will continue to have the 
ability to delegate to individual agencies the authority to procure 
their printing needs directly, provided the agencies meet certain 
qualifications.
    Given the evolutions in technology, and the budgetary pressures 
imposed on agencies by Congress, it is increasingly difficult to rely 
on past studies as justification for future decisions in this area. 
But, the revisions currently under review do not authorize other 
agencies to duplicate the services of GPO.

    Mr. Peterson. Thank you.
    Mr. Ney. Thank you.
                                       Thursday, February 12, 1998.

                            PUBLIC WITNESSES

                          MEMBERS OF CONGRESS

                               WITNESSES

HON. EARL BLUMENAUER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    OREGON
HON. CONSTANCE A. MORELLA, A REPRESENTATIVE IN CONGRESS FROM THE STATE 
    OF MARYLAND
HON. DAVID E. PRICE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    NORTH CAROLINA
    Mr. Walsh. Next, we have scheduled Members to testify, and 
I would like to recognize our colleague who represents the 
Third District of Oregon, Earl Blumenauer. Welcome back. And I 
understand Connie Morella wants to come in and discuss the same 
issue. Why don't you begin and perhaps she will make it. If not 
we will hear from her when she comes.
    Mr. Blumenauer. All right. Thank you, Mr. Chairman and 
members of the committee. I appreciate your courtesy.
    For the last 3 years, traffic in the Washington 
metropolitan area has been second only to Los Angeles in terms 
of congestion. Local governments are taking the initiative in 
calling on local employers to join the fight against traffic.
    The successful program in my District in Portland, Oregon, 
has helped make it the only area in the country where transit 
ridership is rising faster than vehicle miles traveled. 
Successful transportation systems improve the quality of life, 
improving air quality, decreasing congestion, and increasing 
the time people spend doing something other than simply sitting 
in traffic.
    In 1993 the Federal Employees Clean Air Incentives Act 
permanently authorized Federal agencies, including the House 
and the Senate, to offer the same incentive to their employees. 
When this idea was originally considered, House offices did not 
have the needed flexibility in their budgets to support such a 
program. As a result of the fiscal year 1997 legislative branch 
appropriations bill, office accounts have been restructured to 
allow the type of independent spending decisions that we are 
proposing here today.
    It is past time to return to the unfinished business of 
implementing a transit pass program for our employees. More 
than 31,000 Federal employees currently receive transportation 
benefits, and frankly, I am embarrassed as a Member of the 
House that our employees of the Architect of the Capitol and 
the Senate have been able to successfully operate a transit 
pass program for more than 4 years, while we have not.
    I have introduced a resolution that has the support of over 
130 bipartisan cosponsors that would direct the House Oversight 
Committee to issue rules and administer a program to establish 
that House offices in D.C. or the local districts can 
participate in mass transit programs if the individual Members 
chooses.
    The Washington, D.C., Metropolitan Area Transit Authority 
supports the House participation and is ready to assist in 
implementing this program. No additional revenue is needed to 
approve the program since employee passes can be funded from 
existing office budgets. I have met with all 15 different 
agencies, subagencies within the House, with their 
administrators, and we have verified that they all support the 
program and they can handle it within existing budgets.
    I am here today to urge this subcommittee to include 
language in the legislative branch appropriations bill to 
designate that a small portion of the funds appropriated for 
the House Oversight Committee be used to issue rules and 
administer a transit pass program for participating House 
offices. It will cost less than $30,000 to set the thing up, 
and over time it will cost less.
    I would suggest respectfully that this would be dwarfed by 
the savings. We have, I think, 160 people right now in the 
House who help administer our parking program, who patrol these 
lots. If we can have even a minuscule reduction, it would pay 
for itself many times over.
    We are asking employers across the country to step forward 
in the fight for reduced congestion and improved air quality. I 
would hope that the House would join and be part of this 
program.
    I appreciate your courtesy.
    [The information follows:]

[Page 711--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much, Mr. Blumenauer, for your 
testimony. I know you came in last year and spoke with us about 
this. I think there is some sympathy on the subcommittee for 
your request.
    The law that would provide for this is fairly clear. It 
says, ``With respect to the House of Representatives, it must 
be carried by the House Administration Committee of the House 
of Representatives. With respect to the Senate, it must be 
carried by the Committee on Rules Administration of the 
Senate.'' We really cannot appropriate the funds without the 
authorization of the House Oversight Committee. Basically, it 
was the same problem we had last year.
    Mr. Blumenauer. I appreciate, Mr. Chairman, your 
description of the situation. What I'm looking for would be 
language that would help move this thing along.
    I have been visiting around the Capitol. I don't find 
anybody who can find a reason why we don't allow Members the 
ability to provide this benefit for their employees who could 
use it. What we are looking for is a little assistance in 
getting the momentum, because it seems to me this ought to be 
something that is close to a no-brainer, and anything we could 
get in terms of providing some momentum, I think, would be 
useful.
    Mr. Walsh. Basically, what you are asking us to do isput 
some authorization language in the appropriations bill, and we do that 
on occasion, but we do get in trouble on it on occasion. I think we 
would really like to see some direction from the oversight committee. I 
yield to my colleague, the gentleman from Maryland, Mr. Hoyer.
    Mr. Hoyer. I just wanted to say, I understand what you are 
saying in terms of the statute. I want to assure Mr. Blumenauer 
that I will make sure that we bring this to the attention of 
Mr. Gejdenson and Mr. Thomas on the House Oversight Committee, 
on which I serve, because Mr. Blumenauer is absolutely correct. 
He is one of the national leaders on the issue of urban 
planning, of transportation, of the environmental context of 
urban-suburban areas.
    I think this proposal, on which I have joined, so I am not 
totally objective, makes a lot of sense. I appreciate the 
Chairman's observation, and he is correct. I will make sure 
this gets attention by the House Oversight Committee and, 
hopefully, adoption.
    Mr. Walsh. I would like to welcome to the table our Ranking 
Minority Member, Mr. Serrano, and Mr. Wamp of Tennessee, 
welcome.
    Do you have any questions, Mr. Serrano?
    Mr. Serrano. Just a comment. We do support what you are 
trying to do here. I am on your resolution. We will work 
closely with Mr. Hoyer to make sure that this happens.
    Now, let me just ask you one thing. You mentioned $30,000. 
That was $30,000 for the whole House to begin the program, or 
per office?
    Mr. Blumenauer. Our analysis was that in working with the 
various administrative agencies from the House, that it would 
be something on the order of $27,000 to set up the program, to 
allow it to go forward. That is all the expenditure that is 
needed. Every House office that I visited, and I visited all 
15, from the Chaplain to the Sergeant at Arms, to the Clerk, 
they all, first of all, think they have employees that would 
use and welcome it, and they all had money within their budgets 
to be able to accomplish it. But it was just setting the 
program up, promulgating the rules, administratively, and it 
would be less than $30,000.
    Mr. Serrano. Thank you.
    Mr. Walsh. Mr. Wamp.
    Mr. Wamp. Mr. Chairman, I, too, just want to commend 
Congressman Blumenauer not just for what he is trying to do 
here in Washington, but what he does across the country. He 
came to my home city of Chattanooga, Tennessee, recognized as a 
national expert on urban planning and mass transit. He has the 
problem that sometimes you are not recognized really as the 
prophet you really are, and our whole country is so automobile-
driven, and has been for a century now, that we have made some 
tactical mistakes.
    As a result, we have got some real serious problems with 
urban sprawl across the country. Mass transit is a solution, 
but we are fighting two industries, and I will tell you, we 
know it in the Southeast, and we recognize these problems.
    I just want to commend him for what he is doing, and want 
to encourage him along. I know it is an uphill struggle the 
whole way, and I don't have the solutions for here in 
Washington, but I appreciate you coming, and I hope you keep 
the pressure on until we start changing our culture and our 
mind set in this country, and try to preserve as many 
greenfield sites as we can, and embrace the notions that I 
experienced in Europe when I was 12 years old, and saw mass 
transit meeting a lot of needs in that society, which frankly 
here was squeezed out years ago. Thank you, I commend you, and 
we need to try to find a way to work with you.
    Mr. Walsh. Lastly, Mr. Blumenauer, let me just again thank 
you for your testimony. In testimony last year, you had another 
suggestion that we did take up on. We put in report language 
that urged the Architect to undertake a study of the 
feasibility of installing adequate shower and locker facilities 
for the needs of House employees. Bob Miley did a study and 
determined that there were showers for two males and two 
females in the Ford Building, two newly renovated male and 
female showers at the O'Neill Building, in addition to a 
facility in the Capitol, but they are now undertaking to make 
additional showers for men and two for women in the Rayburn 
Building on the C Street side.
    So your recommendation was very--I think a very good 
recommendation, very caring and concerned about staff, and we 
responded.
    Mr. Blumenauer. You did, indeed, and we have had some 
terrific meetings with the Architect. It seems to me they are 
even going to be able to do some other items. Your action on 
the subcommittee was really the difference. I really appreciate 
your consideration.
    Mr. Walsh. Thank you. You are welcome any time.
    I see Congresswoman Morella has joined us. She is welcome 
to the witness table to give us her thoughts and suggestions on 
transit.
    Mrs. Morella. Thank you, Mr. Chairman. Thank you, Members 
of the subcommittee. I appreciate your accommodating my 
schedule, too. I know Mr. Blumenauer, who is the sponsor of the 
legislation that I am supporting, already testified. I thank 
you for your allowing me to express my support of House 
Resolution 37. As traffic in the Washington metropolitan area 
increases, I think it is really past time for the House of 
Representatives to join the Senate and 139 Federal Agencies in 
helping to reduce congestion by offering transit passes to our 
employees.
    Specifically, I urge this subcommittee to include language 
in the legislative branch appropriations bill to ensure that a 
portion of the funds appropriated for the House Oversight 
Committee is used to issue rules and administer a transit pass 
program.
    Under Congressman Blumenauer's resolution, the House 
Oversight Committee would give all House offices the option--
not a mandate--to offer transit benefits to employees. These 
transit passes would come from existing funds, and therefore 
would not require additional appropriations. Only employees in 
participating offices who do not hold a House parking permit 
would be eligible.
    Several members of my staff, those who work in the Rayburn 
Building and those who work in my Rockville district office, 
have told me they would stop driving and use Metro if they had 
a transit pass. The frustrations of traffic congestion have 
become a way of life for my constituents in Montgomery County, 
Maryland, including many who commute to Capitol Hill.
    A study by the Washington Board of Trade which ranked the 
Washington metropolitan area second in the Nation in traffic 
congestion and first in wasted time and gasoline. The average 
commute time in the District of Columbia area is 30 percent 
higher than the national average. Near-future projections show 
that D.C. area commuters may spend 100 more hours yearly 
getting to and from work than they do now. I know my own 
commute to the Hill has become much more onerous over the last 
11 years that I have served here.
    Last month, Montgomery County, Maryland, launched a Smart 
Moves 2000 campaign to mobilize businesses in my district 
against traffic gridlock. More than 80 businesses joined the 
county in hosting a Commuting Solutions Summit, which featured 
three workshops that addressed alternative solutions to the 
traditional commute. Employers were encouraged to offer their 
employees benefit incentives--such as $65 a month per employee 
for public transit, preferred parking for car pools, compressed 
work schedules, and increased flex time--in order to encourage 
alternative transportation, such as Metrorail, buses, the MARC 
trains, walking, and biking.
    The goal of this new public-private partnership campaign is 
to enlist 2,000 county businesses to promote alternative 
commuting solutions by the year 2000 for the more than half 
million daily commuters in Montgomery County. I would recommend 
such a camapign for other areas throughout the Nation. The 
workshop indeed helped businesses learn to accommodate their 
employees and make them more productive, increase morale, and 
get congestion off the road, or at least substantially diminish 
it.
    The Washington Metropolitan Congressional Delegation has 
asked the Department of Transportation to convene a summit in 
May of this year to address the problem of Washington 
metropolitan traffic congestion. The objective of the 
conference will be to share new ideas and build a consensus 
around solutions that would work in our region.
    House Resolution 37, which would offer transit benefits to 
more than 7,000 House employees, offers a commuting solution 
that most likely will be endorsed by summit participants.
    Mr. Chairman, and members of this very important 
subcommittee, I want to urge you to ensure that the House 
Oversight Committee takes steps to provide House employees a 
commuting solution. I think it is important for people in our 
districts to see that we are in the lead. Thank you.
    [The information follows:]

[Pages 716 - 717--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much. Are there any questions of 
the witness?
    Mr. Serrano. No. I have no questions, just that we are very 
supportive of the idea. We are just trying to see if we get 
support from the other committees.
    Mr. Walsh. Mr. Cunningham.
    Mr. Cunningham. Congresswoman, the ideas, I think, of flex 
time, parking pools, bike lanes--and this gentleman here rides 
his bike in on days when the weather is nice--those are all 
good to cut down on the traffic. But placing upon the Federal 
Government this burden seems at odds when I am trying to cut 
the size of the Federal Government spending. I know when I was 
in the Pentagon, I had to change my lifestyle to make it to 
work on time and leave early in the morning to miss the 
traffic.
    But for us to go ahead and put dollars into a transit pass 
system for more Federal employees raises some concerns with me. 
I am going to have to take a look at that portion of it. But 
the other ideas, I think, are good.
    Mrs. Morella. You know, Congressman Cunningham, I would 
agree with you, except this does not require additional 
appropriations. This would mean that for instance, from my 
congressional office budget, I could allow--it is an option--my 
employees the opportunity to take Metro and use a transit pass. 
This would also help keep cars off the road. I would be 
reducing traffic, and therefore, making my staff and other 
commuters happier. They would use Metro, the system that we are 
going to appropriate $50million to complete; 103 miles this 
year.
    This is something that the Federal Agencies already can do. 
They can give a $65 a month transit pass to their employees. So 
it seems to me that the Congress, which must comply with the 
Accountability Act that ensures we live under the laws we 
create, should be doing the same thing.
    Mr. Walsh. As we understand it, I think we would need some 
direction from the House Oversight Committee, the authorizing 
committee, before we could appropriate funds. As we said to Mr. 
Blumenauer, I believe there is some sensitivity for the issue 
on the subcommittee, but we do need some direction from them 
first.
    Mrs. Morella. Mr. Chairman, you might consider putting it 
into bill language, the report language, perhaps to send the 
message to the House Oversight Committee that the Congress 
should do all we can to relieve congestion.
    Mr. Walsh. We will give that consideration.
    Mr. Cunningham. I do like your Irish colors this morning.
    Mrs. Morella. Thank you.
    [The committee has received the following information:]

[Pages 719 - 723--The official Committee record contains additional material here.]


    Mr. Walsh. Our colleague, Mr. Price, from North Carolina is 
here. Mr. Shays is not, but I'm sure you can introduce us to 
the topic and we will wait to see if he shows up. Welcome.
    Mr. Price. Thank you, Mr. Chairman, Mr. Serrano, Mr. 
Cunningham. Thank you very much for the opportunity to testify 
before you today. I am here on behalf of Congressman Chris 
Shays and myself. Mr. Shays is chairing a Government Reform and 
Oversight Subcommittee hearing this morning. He may not be able 
to be here. So I will go ahead and begin our joint statement in 
hopes that he can join us shortly.
    As you may know, Mr. Shays and I and several other 
cosponsors have introduced legislation which would give the 
public limited Internet access to the Congressional Research 
Service products. Our bill, H.R. 3131, is the companion to 
legislation sponsored in the other body by Senators John McCain 
and Lauch Faircloth. We have submitted a copy of H.R. 3131, 
access via the Internet, for inclusion in your record.
    Simply put, we believe the American people ought to have 
access to the research their tax dollars pay for, the same 
research that Members of Congress rely on to make critical 
policy decisions. To this end we recommend that the 
subcommittee provide an initial appropriation of $100,000 in 
your fiscal year 1999 bill to bring the public on line with 
CRS.
    In our offices, as you know, we already handle a 
substantial volume of constituent requests for various CRS 
issue briefs and reports and we routinely send out CRS 
publications to assist constituents in trying to make sense of 
policy debates on Capitol Hill.
    Over the last several years, Congress has made a concerted 
effort to increase public access to what goes on here. We 
permit cameras in the House and Senate, even in our hearing 
rooms, to record our debates. The Thomas Web Page now lets 
constituents look up votes and check the status of bills and 
read the actual text of legislation and amendments.
    Yesterday alone Thomas was accessed 371,610 times. What is 
not readily available, however, is unbiased analysis of 
legislation or the history of legislative efforts to address 
policy matters. We think the people paying for CRS research 
ought to have greater access to it.
    Mr. Chairman, we understand CRS appeared before you last 
week and raised some concerns about giving the public Internet 
access to their publications. We are trying to schedule a 
meeting so we can resolve some of these concerns. But in 
general, we are confident they can be resolved. We believe we 
have put together a narrowly drawn bill that would permit only 
appropriate public access to CRS research at minimal cost to 
the taxpayer.
    Our legislation would give the public Internet access to 
the same CRS documents that congressional staff may access via 
the Internet: issue briefs, appropriations analysis and some 
CRS reports. It would not give the public carte blanche to all 
CRS research or to confidential reports, nor would it permit 
direct public access to CRS. It would give the Director of CRS 
discretion in determining whether future reports are suitable 
for public distribution.
    Government shouldn't be a mystery to the people who are 
footing the bill. Lets remove one more barrier to giving the 
average American access to the halls of Congress.
    Mr. Chairman, I also have a chart showing Thomas usage over 
the last 30 days. I would like to submit that for the record.
    Mr. Walsh. Yes.
    [The information follows:]

[Page 726--The official Committee record contains additional material here.]


    Mr. Price. Thank you very much.
    Mr. Walsh. Thank you very much for your testimony. I think 
this is an important question. Certainly, we have--Congress has 
made an effort to support the digitization of information and 
making it electronically available to the public, as is 
witnessed by the number of hits Thomas is getting now. There is 
a tremendous need and desire for information, and I think we 
would all agree that the public should have access to 
information, and we are trying to provide the resources to do 
that.
    There are some very interesting questions on the use of 
CRS, its role vis-a-vis the Congress and its role vis-a-vis the 
public. I think we can have that discussion, certainly.
    There are some very strong feelings among Members, and 
certainly within the CRS, that current law would preclude us 
from doing that. CRS may have to be changed in authorization in 
order to allow us to do this, in order to allow us to fund it. 
I am not sure the question has been resolved by the Congress 
yet.
    Mr. Price. That may be. CRS has raised some issues about 
their protected constitutional status, about copyright issues 
and liability issues. I would just stress that what we are 
talking about here is a difference only of degree and not of 
kind in terms of the kind of access the public already has. All 
of us send out daily CRS issue briefs, and we givethat to 
constituents when they request it of us without these issues being 
raised.
    What we are talking about is adapting this function to new 
technology and disseminating this material on a much wider 
basis. I believe the issues could be easily resolved that CRS 
has raised and we are eager, of course, to work with them and 
with you in figuring out just what that would require.
    Mr. Walsh. Right. Thank you.
    Any questions?
    Mr. Serrano. Just a comment. You know, I understand where 
you want to go, and I am very supportive of that, but I just 
wanted to let you know that on both sides of the aisle there is 
concern that has been brought up here, and especially about the 
content of some of the information that we get. It is a very 
fine line that we walk here.
    On one hand, I have no problems with the public knowing 
everything. But does the public have a need or right to know 
about a memo that is handwritten to me by a staff member? I see 
CRS' role at times in the same way. I ask them opinions, many 
times I ask them quite many opinions on the relationship 
between Puerto Rico and the U.S. leading towards the 
possibility of a bill on the floor to deal with the issue of 
Puerto Rico's political future. That issue on the island and in 
my community and other communities is an extremely hot issue.
    I don't know that CRS, if they knew everything they put out 
would be public, would not be weighing what kind of statements 
they are making, because they know they would be dropping like 
a bomb somewhere on one side or the other. So I am afraid that 
in this particular case, and I could be convinced otherwise, 
allowing the public in on everything they advise us on would 
make them rethink a hundred times the kinds of statements they 
make. That is one thing.
    Secondly, what they give us is sort of a one, two, three, 
four, five steps prior to a final decision. The public sees us 
on C-SPAN making the final decision. They see us in committee 
asking questions leading to the final decision. But they really 
don't see our thought processes and how we get to the 
statements we make on the floor.
    CRS is an integral part at times of how we get through that 
thought process and to the floor, so I am concerned about what 
would be available, who would make it available, at what point, 
and what kind of work CRS would continue to do if they knew 
that everything that they put out possibly could be put out to 
the public.
    Mr. Price. Let me just stress that that is not our 
proposal. We are not proposing that everything be available to 
the public. We are certainly not suggesting that personal or 
confidential reports of the sort you described would be 
available. As a precaution, we would give the Director of CRS 
the final say, even in terms of the other products of CRS.
    What we are talking about is the kind of issue briefs, the 
kinds of histories of legislative efforts to deal with 
problems, the kinds of appropriations analyses that you and I 
send out every day to constituents who request them. That is 
what we are talking about.
    We are simply talking about adapting a function that we 
already perform, that CRS already performs, to the Internet and 
to the new technology. In no way do we desire to compromise the 
kind of confidential relationship that you describe, or 
political sensitivity. We are well aware of that. We, I 
believe, write sufficient safeguards into this bill.
    Mr. Walsh. Thank you, sir.
    Mr. Cunningham.
    Mr. Cunningham. I talked to staff and I thought, you know, 
it sounds like a pretty good idea, but listening to CRS, if you 
work out some of those problems, I think most of us would 
support the kind of work that you want to do. It is much like 
the sunshine bill we came up with, where people ought to have 
access to come in and see our hearings, that they are open to 
the public and we can film them and those kinds of things. So I 
think that openess is good. I do have a little concern, too, 
because I know each of us sometimes when we are actually for a 
bill in the end, as the process goes on, our language through 
the process may oppose the bill, just so that we can get 
changes so we can support it in the end. That can be taken out 
of context a lot of times. Those would be little concerns that 
I would have.
    I think that because people that read a report may not 
always understand the process we go through. Otherwise, I think 
it is probably a pretty good idea. If you can work it out with 
CRS, I would like to take a look at it.
    Mr. Price. We certainly intend to do that. We are open to 
suggestions as to how we might achieve our purposes.
    Mr. Cunningham. Any time we can open up this place, it is 
good.
    Mr. Price. I think so, too. Of course, there is widespread 
availability now where we have already adapted in many ways, 
with C-SPAN and with, of course, the widespread availability of 
committee prints, and of CRS reports. The Thomas innovation is 
a huge step forward. I believe this follows logically upon 
that. I think the kinds of protections for CRS' confidential 
role and for their constitutional role as an adviser to the 
Congress--I am confident those protections can be provided.
    Mr. Walsh. Thank you.
    Mr. Cunningham. That is all, Mr. Chairman.
    Mr. Price. Thank you very much.
    Mr. Serrano. Thank you.
    [The information follows:]

[Pages 730 - 734--The official Committee record contains additional material here.]


                                       Thursday, February 12, 1998.

                           Outside Witnesses

                                WITNESS

PATRICIA WAND, UNIVERSITY LIBRARIAN, AMERICAN UNIVERSITY
    Mr. Walsh. Since we don't have any other Members here yet, 
we will go with the outside witnesses, and first would be 
Patricia Wand, representing the American Library Association, 
American Association of Law Libraries, and the Association of 
Research Libraries. It is quite a portfolio.
    Welcome.
    Ms. Wand. Thank you. I am Patricia Wand, University 
Librarian at American University. If I may digress for one 
moment, I would like to congratulate you on being one of the 
few returned Peace Corps volunteers who has been elected to 
Congress.
    Mr. Walsh. Thank you.
    Ms. Wand. I, too, am a returned Peace Corps volunteer and I 
am not surprised to see you leading a committee like this.
    Mr. Walsh. We are everywhere.
    Ms. Wand. It is a wonderful group to be among.
    Mr. Walsh. It sure is.
    Ms. Wand. We have all been sensitized to many of the issues 
that this subcommittee, for example, faces with the information 
dissemination with the oversight of----
    Mr. Walsh. That is true. Where did you serve?
    Ms. Wand. In Colombia, 1963 to 1965.
    Mr. Walsh. That is where I thought I would go. Since my 
major was in history, South American history, primarily, and I 
spoke Spanish and they sent me to Nepal.
    Ms. Wand. So now you have loyalties in two continents.
    Mr. Walsh. It is good to have an RPCV with us this morning.
    Mr. Serrano. I was born in Puerto Rico and the Army sent me 
to Alaska.
    Ms. Wand. You have adjusted to two climates.
    I am appearing today on behalf of the Nation's leading 
library associations, and I certainly appreciate the 
opportunity to speak to this subcommittee that has a long 
history of support for the Library of Congress. I would like, 
first, to speak about the Library of Congress requests in the 
budget.
    Since the beginning of this decade, we have witnessed an 
extraordinary occurrence with the development of the World Wide 
Web and the adoption of the Internet by millions of individuals 
across the globe. Here in the United States, the growing 
acceptance of these media signal a fundamental shift in the way 
we communicate, educate, and, indeed, go about the democratic 
process.
    Libraries have and will continue to play a pivotal role in 
creating and maintaining long-term access to these 
communication channels and to the content that flows through 
them. We engage in these efforts to ensure that all sectors 
benefit from their resources, and that, importantly, the 
content is available for the future generations as well as the 
current generations. That is a real concern, the preservation 
of information in electronic formats.
    The Library of Congress, with other libraries across the 
country, invests in new technologies to promote access to a 
diverse array of information resources to the public. Managing 
the transformation from primarily print collections to a print 
and electronic-based environment requires continued and 
sustained investments in acquisitions, technology and human 
resources.
    I thank you personally, this subcommittee, on behalf of my 
library colleagues, for the continued financial support you 
have given to the Library of Congress. Your support has enabled 
it to leverage all of its resources, public and private, to 
develop the fine technologically advanced programs it has 
initiated. One of the most outstanding examples of this is the 
National Digital Library, to which the Library of Congress has 
lent absolutely essential leadership.
    The Library of Congress fiscal year 1999 budget request of 
$369.3 million positions the Library to realize the benefits of 
the digital environment, while it attempts to maintain the 
traditional programs and services upon which we all depend. We 
enthusiastically support the Library's request for the fiscal 
year 1999 funding for the automation projects, including new 
computer work stations and equipment, computer security, 
preparing for the year 2000 improvements, and more. These 
requests individually and collectively will permit the Library 
to move ahead in a more effective and efficient manner.
    Of particular interest to our association members are 
several other programs, such as the National Library Service 
for the Blind and Physically Handicapped, a critically 
important service to the Nation. We support the minimum request 
to purchase 56,000 cassette book machines, and to add an 
additional 5,000 cassette book machines in order to meet the 
increasing demands.
    The National Library Service for the Blind and Physically 
Handicapped last year delivered 23 million items to people who 
need access to information. We urge your full support for the 
Law Library's fiscal year 1999 budget request of $6.7 million. 
Since 1992, the Law Library has lost 10 FTE positions, and this 
request would replace eight of those for badly needed reference 
and research service. In addition, the requests include 
$340,201 to support the Law Library's automation projects, such 
as the Global Legal Information Network. The American Folklife 
Center and its archive of folk culture undertakes an important 
role in preserving and presenting American folklife. We 
strongly endorse the permanent reauthorization of the 
AmericanFolklife Center. This would permit the Library and the Folklife 
Center to establish priorities for collections and to increase their 
fund-raising activities.
    For several years, the Library of Congress has been engaged 
in evaluating a host of security issues around its collection, 
the facilities, and importantly, for staff and visitors as 
well. We support the Library's request for approximately $2.5 
million to improve its security systems. We also support the 
security requests for the Library that are included in the 
Architect of the Capitol budget request.
    In closing, Mr. Chairman, as we approach the millennium, we 
should work to ensure that the public benefits from our 
Nation's cultural resources, as well as for the global 
information resources that the Library acquires. Funding to 
assist the Library in strengthening its infrastructure is a key 
step in meeting this important goal.
    Thank you for the opportunity to appear before you today. 
The library associations look forward to working with this 
subcommittee. We very much appreciate your continuing support 
for the Library and its programs.
    [The information follows:]

[Pages 738 - 742--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much for your very thoughtful 
testimony. This subcommittee has traditionally been a very 
strong supporter of the Library of Congress and rightly so. It 
is our most valuable information resource, and we will do our 
best to make sure it is funded properly and that we provide the 
resources for them to meet their needs and goals.
    Are there any questions of the witness, Mr. Serrano?
    Mr. Serrano. No, just reinforcing your statement, Mr. 
Chairman, both sides are committed to doing the right thing 
here. We are very happy that you have come to join us in 
support of those requests, because I certainly believe in them 
and I know the Chairman does. We are doing the best we can to 
make sure we are doing our part.
    Ms. Wand. We certainly acknowledge and appreciate them. The 
programs of the Library of Congress are essential to the 
libraries of this Nation today and, of course, in the future, 
as well, and the dilemma that the Library of Congress faces is 
one very similar to that we all face, which is this very 
important dual track of information storage and retrieval. We 
are maintaining the print collections at the same time that we 
are adding on, overlayering, if you will, the electronic 
resources. It is a very expensive proposition, as you know.
    Mr. Walsh. It is, but essential.
    Ms. Wand. Essential.
    Mr. Walsh. Mr. Wamp?
    Mr. Wamp. No, thank you.
    Mr. Walsh. Mr. Cunningham has just joined us. Would you 
like to ask any questions of the witness, Mr. Cunningham?
    Mr. Cunningham. No. I will pass. I have seen the questions 
that you had. We had another meeting this morning.
    Mr. Walsh. I understand. Everyone is busy this time of year 
with hearings. I have three different hearings right now.
    Okay. Thank you very, very much for your testimony. We 
appreciate your advocacy for libraries.
    Ms. Wand. All right. I would like to take another few 
minutes and talk about the Government Printing Office.
    Mr. Walsh. Okay.
    Ms. Wand. Our associations also support the FY--the public 
printer's fiscal year 1999 request of $30.2 million for the 
Superintendent of Documents' salary and expenses appropriation. 
Users of government information and librarians in the Nation's 
1,368 depository libraries thank you for funding the Federal 
Depository Library Program. This is a unique program that is 
one of the most effective, efficient, and successful 
partnerships between the Federal Government and the American 
public.
    Your constituents have equitable, efficient, and no-fee 
access to Federal Government information created by their tax 
dollars, and they increasingly, as well, rely upon the GOP 
Access program for its services and access to electronic 
information. We commend the Government Printing Office for its 
continued commitment to develop GPO Access.
    Currently, GPO Access has 70 databases from all three 
branches of government. Usage of GPO Access has grown 
exponentially since we met with this committee last year. For 
example, in less than 2 years, on-line searches have increased 
nearly 1,200 percent, and retrievals of information; that is, 
actual documents downloaded by the public, have increased 319 
percent. If we look at a snapshot of October of 1995 and 
October of 1997, usage of GOP access increased tenfold.
    In addition, we applaud new programs that the GOP Printing 
Office is pursuing to make it easier for the public to locate, 
find, and use electronic information and to ensure that it will 
be permanently available for ongoing and future use.
    We fully support the three-way partnerships initiated by 
the Superintendent of Documents in which a library enters into 
a formal agreement to provide permanent public access to 
specific electronic collections. This is absolutely essential, 
that we look to permanent public access of electronic 
information. Without moving in these directions, important 
electronic information will continue to be lost daily as files 
appear and disappear from agency web sites and computer 
services.
    The success of GPO Access cannot be measured without 
acknowledging the substantial cost that depository libraries 
expend in order to provide your constituents with access to 
government information in both print and electronic formats. 
These costs include providing highly-trained staff, adequate 
space, necessary additional materials, costly equipment, and 
Internet connections.
    For example, in 1997, California State Library spent over 
$800,000 just for the Government Publications Section, and that 
is to support their participation in the Federal Depository 
Library Program.
    We reiterate the concerns we expressed before this 
subcommittee last year about limiting the distribution of print 
titles of core historical materials, such as the bound 
Congressional Record and the bound U.S. Congressional Serial 
Set.
    Relying solely on electronic versions at this time do not 
meet necessary preservation standards. The American Library 
Association and the American Association of Law Libraries have 
formally expressed concern over the impact of this decision on 
permanent public access to the record of this Congress.
    Mr. Chairman, I ask that an article appearing in 
theFebruary 16th issue of the U.S. News and World Report--the article 
is titled ``Whoops, There Goes Another CD-ROM''--be added as an 
attachment to our long statement. This timely article expresses our 
vital concern about relying on electronic formats for such historically 
important documents as the Congressional Record and the Congressional 
Serial Set.
    [The information follows:]

[Pages 745 - 746--The official Committee record contains additional material here.]


    The article, in fact, states, and I quote, ``Future 
generations will be fortunate if they get a chance to view the 
records of the current Congress.'' An accompanying chart in the 
article documents that acid-free paper has a storage life of 
500 years, that has been tested, as compared to CD-ROMs that 
have an unreliable and drastically shorter life of 5 to 50 
years.
    Truly, gentlemen, this is a time when we cannot afford to 
be penny-wise and pound-foolish. We must preserve the records 
of Congress for our future generations. If we don't do it in 
acid-free paper at this point, we have no other alternative 
that measures up to that in terms of the record.
    As Congress geared up to revise Title 44 a year ago, ALA 
established an interassociation working group on government 
information policy that includes representatives from our 
library organizations. The working group has developed a 
legislative proposal that would extend the definition of 
government information explicitly to electronic resources. It 
would close some loopholes in the law. It would provide 
incentives for agencies to participate in the program, and it 
would ensure the preservation and permanent access of 
electronic government information.
    As discussions to amend Title 44 continue, it is imperative 
that the Superintendent of Documents' salaries and expenses 
appropriation be fully funded in order to continue the steady 
and significant progress made to move the Federal Depository 
Library Program to a more electronic program.
    Mr. Chairman, thank you for the opportunity to appear 
before you today and to speak on behalf of the library 
associations and Federal Depository Library Program.
    [The information follows:]

[Pages 748 - 764--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you. I think you would be interested to 
know that we are about to reprogram an additional $79,000 to 
the Government Printing Office at Mr. DiMario's request for 
additional bound copies of the Congressional Record.
    Ms. Wand. Wonderful. Do you know whether this will mean 
that all the depository libraries will be able to receive their 
copies as they have historically, up until 4 years ago?
    Mr. Walsh. Staff advises me that this would cover the 
regional libraries, and that the Government Printing Office 
would then take a look at resources that they have within their 
current budgets to see if they can help the other libraries.
    Ms. Wand. That is the best news I have heard in a long 
time.
    Mr. Walsh. Good. Are there any other questions?
    Mr. Cunningham.
    Mr. Cunningham. There was something that disturbed me that 
I was not aware of; I didn't realize that a CD-ROM was only 
good from 5 to 50 years. I have done a lot of lithographs and I 
know that the acid-free paper does last, but also ink goes 
away, so we sign those things in graphite, in pencil, instead 
of pen.
    Is there permanent ink that does not go away after a 
certain period of time, so we have those documented? Because I 
know the value of electronic equipment just for space, but is 
there any research into looking into saving those things 
electronically? You could take your Law Library and you could 
burn it and we could start over and be much better, I think. 
I'm kidding.
    Ms. Wand. There is research going on in this issue. But the 
conclusion at this point in time is that preserving on acid-
free paper is the most reliable long-term storage media.
    Mr. Cunningham. Do they use pen or pencil?
    Ms. Wand. Print.
    Mr. Cunningham. We have a Federal depository in California 
State University-San Marcos in my district, and they are just 
getting it started. They are ecstatic about it. They had a 
group of people come in and see the different offerings that we 
have.
    But just besides the Library here, one of the focuses in 
education that we had that was a bipartisan bill, called the 
21st Century Classrooms Act, where we encourage private 
enterprise invest in computers and they give them to the 
schools. In some cases the schools were having to throw them 
away because they didn't have the upgraded software and they 
couldn't use the computer. So we have a corporation called 
Detweiler Foundation that receives the computer from industry, 
so they get an expanded tax write off for the business. So the 
business buys a new computer.Detweiler takes the newly donated 
computer, they then use prison labor and military brig labor to upgrade 
it so they learn a skill, and then it goes to the school. We are going 
to try and do the same thing with our public high schools and public 
libraries, so people have more access.
    In the welfare bill there is not enough money for training 
for people, so where do they go? It is the libraries. That is 
one of the areas that we want work in and to help as much as we 
can, not just here in Washington, D.C. But I think it is 
fantastic, what you are doing.
    Ms. Wand. Thank you. It sounds like you have a wonderful 
model program going that might be emulated in other places.
    Mr. Cunningham. The Detweiler Computers for Schools program 
is in 21 States now and they are expanding. The President 
signed it, Bill Archer in the Committee on Ways and Means put 
it through, so we have a tax break for it. We had offsets for 
it. It is really doing well.
    Ms. Wand. Congratulations.
    Mr. Walsh. Thank you very much.
    Mr. Cunningham. One last comment. I am sorry, Mr. Chairman.
    I worked on the special education bill when I was Chairman 
in education. I visited down, not even in my district, but in 
San Diego in an area where they have special education children 
and physically handicapped working. There is a gentleman there 
that was totally nonsighted, but uses a voice-activated 
computer. I would like to see more of that. I know it is 
expensive, but I would like to see more of that software and 
technology to come into it, because I have a lady named Holly 
Caudill who was paralyzed in a car accident when she was 18. 
She works full-time, but all of her income goes just to take 
care of her physical needs, and something like this, with the 
technology, really helps those people. They don't want to be on 
welfare; they want to work, but we need to help them. So 
anything you can do in this particular area for the physically 
handicapped----
    Ms. Wand. Adaptive technology is phenomenal.
    Mr. Walsh. Thank you very much.
                              ----------                              


                                WITNESS

JANET S. ZAGORIN, CHAIRMAN, STANDING COMMITTEE ON THE LAW LIBRARY OF 
    CONGRESS, AMERICAN BAR ASSOCIATION
    Mr. Walsh. Next is Janet S. Zagorin, Chair of the Standing 
Committee on the Law Library of Congress, the American Bar 
Association. Welcome.
    Mr. Cunningham. Strike my comment about burning the Law 
Library.
    Ms. Zagorin. Thank you. I brought my lawyer.
    Mr. Walsh. The horse has left the proverbial barn on that 
one.
    Ms. Zagorin. Thank you, Mr. Chairman. I also have the 
privilege of being accompanied by former Congressman Orton, who 
is a member of my committee of the ABA.
    Mr. Walsh. Glad to have you back with us.
    Ms. Zagorin. On behalf of the ABA, I really want to thank 
you for letting us speak. I don't want to reiterate my 
testimony. I would ask that you would put it into the record.
    Mr. Walsh. We have your testimony and we will put it in the 
record. If you would summarize, it would be terrific.
    Ms. Zagorin. As you know, the ABA has established this 
committee because we wanted to support the Law Library, not for 
the private bar, but because we think it is an essential 
institution of the United States for the citizenry, not just of 
the United States, but in today's world for the global world.
    I don't think there is any institution in the United States 
that at this moment in time is more important in terms of 
expressing the United States' commitment to the rule of law. If 
you come to the Law Library, if you work with the Law Library 
as it serves Congress or any of our citizens, our scholars, our 
students, you know what a role model it has been for other 
jurisdictions in the world, particularly in the emerging 
markets, who look to us for our jurisprudence to be an example 
as to how to draft their laws, and what democracy really looks 
like.
    If you look at it just on that level, we at the ABA think 
it is an incredibly cost-effective way of expressing democracy 
to the world. It also says something about our openness. We 
have had a lot of comments this morning about the openness of 
the United States and what is available. Congress is looked on 
with awe. If you travel around the world, in Latin America, in 
Asia, in the former Soviet Union, they see the fact that our 
Nation supports a Law Library, that our laws are available on 
the Internet, also any citizen of the world can access our 
materials going all the way back, and we hope way into the 
future. It is much more effective almost than anything else 
that I can think of. I would really hope that we would not 
ignore that point when we are thinking about appropriations.
    Now, our budget has been flat in the Law Library and the 
Library of Congress, and we understand the need for 
keepingtrack of the budget and cutting the budget. We think it has been 
cut as much as possible, and what our goal is, what my goal is, in 
talking to you this morning is to make another point. That is that 
there are two industries in the United States that we think are the 
preeminent exports to the surrounding world and that is our technology 
and information.
    The Law Library is certainly involved in both of those. The 
access to information that we think is provided, you have 
already heard other Members of the House talk about access 
through the Internet. We think that the ability to provide 
those resources on line through the Internet, through a variety 
of technological innovations--we have agreements with NASA, the 
World Bank, the United Nations. If they loan money, they have 
to use the Law Library of Congress as global information 
network. We are helping, right now, 20 countries around the 
world put their statutes on line.
    We think you will be able to cut money in other areas of 
the government and in other areas where there has been 
duplication. But as to the Web site, there are hundreds of--we 
are linking to the private sector as well as government sites 
around the world, and we think that the Library of Congress 
helps businesses in the United States become more competitive 
because they have access to that information.
    It has already been stated, but I think it is worth stating 
again. If you look at our newly remodeled Law Library, very 
close to the Capitol, the treasures of the Law Library, you are 
able to see from the first draft of the Declaration of 
Independence, with Franklin's notes in the margin, to 
Jefferson, to the civil rights laws to the immigration laws. 
Those are the treasures of the United States. We really think 
that the Law Library has got to be preserved so that as we go 
into the next century we will have those treasures for our 
citizens.
    There is just the cost of conversion to technology, and we 
have to maintain our reference collection as the preeminent law 
collection in the world. Thank you again for the comments that 
you have already made about the Library, but we really hope 
that you will seriously consider this. We need to maintain the 
Library in its present condition.
    [The information follows:]

[Pages 769 - 778--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much for your testimony. It is 
very straightforward and clear, and important. We agree with 
you on the importance of maintaining all of our libraries and 
in particular our law libraries. This nation is founded upon 
law. I think we among nations live by the rule of law, although 
we all have our questions about certain laws. That is very 
normal. But we are only as good as those laws, too. So I think 
you will have that commitment from the subcommittee to continue 
that support.
    Mr. Serrano.
    Mr. Serrano. Sign me up.
    Ms. Zagorin. I am.
    Mr. Cunningham. I have a practical question. I was dean of 
a college out in California, and one of the problems when they 
had to get the accreditation for the law school at the 
university, was that they had to have a complete law library at 
the university, which is, you know, $1 or $2 million. They were 
having trouble with that cost.
    Is there any look by the ABA in working with accreditation 
of schools to where, in this electronic age, we may diminish 
the requirement for each school to have that monumental paper 
law library? I know there was one of the historically black 
universities that was having problems with accreditation 
because they didn't have enough of a library. The avability of 
electronic documents would enhance that library, without 
demanding great costs. I don't know if there is any move afoot 
to work with the availability of electronic law collections, 
rather the paper ones.
    Ms. Zagorin. Congressman, I don't serve on the ABA's 
accreditation committee, but I would be happy to look into it 
for you. I do think that in the ABA as a whole and in the law 
library profession as a whole, there certainly is a movement 
now towards making sure that people have access to the 
information. Access is different than actually having all of 
it.
    I can't really answer that question in, I think, a credible 
manner, but I will certainly find out for you.
    Mr. Cunningham. If you have access, say, to a book that has 
a certain law in it, and you have 100 percent access to it via 
the Internet, why do you have a requirement to force the 
university to have that monumental library, which prevents them 
from getting accreditation? It would be a good thing to look 
at, and I think it would be helpful.
    Ms. Zagorin. The ABA does have a link to the Library of 
Congress' and the Law Library of Congress' web site. In fact, 
the ABA, in fact, provides one of its publications to that Web 
site, so if you log on through LC, you can get that.
    Mr. Cunningham. Maybe some of that $2 billion in the 
tobacco settlement that lawyers reaped could go to the library.
    Mr. Walsh. The two lawyers in my family will not comment on 
that.
    Mr. Cunningham. Did they get any tobacco?
    Mr. Walsh. No, they don't smoke.
    Thank you very much for your testimony.
    Ms. Zagorin. Thank you very much for your time.
    [The committee has received the following information:]

[Pages 780 - 787--The official Committee record contains additional material here.]


                               WITNESSES

JOEL STERN, AFSCME, LOCAL 2477
CHRISTINE SCHOLLENBERGER, AFSCME LOCAL 2910
DENNIS M. ROTH, CONGRESSIONAL RESEARCH EMPLOYEES ASSOCIATION

    Mr. Walsh. Our next witnesses--actually we have three. We 
would like them all to come to the table at the same time if 
they would, in a panel. Those are the representatives of the 
bargaining units, members of organized labor, Joel Stern, 
AFSCME Local 2477, the Library of Congress; Christine 
Schollenberger, AFSCME Local 2910, Library of Congress; and 
Dennis Roth, Congressional Research Employees Association, 
Congressional Research Service.
    Welcome. We will proceed, and I think we will wait until 
there are about 2 minutes left on the vote and we will go up to 
vote, come back, and I will finish hearing your testimony and 
complete the questions.
    Mr. Stern is first on my list. Would you like to proceed?
    Mr. Stern. Thank you for having us, Mr. Chairman.
    Mr. Walsh. Thank you for your patience, by the way.
    Mr. Stern. It is a pleasure. I am Joel Stern, President of 
the American Federation of State, County, and Municipal 
Employees, Local 2477. My organization represents approximately 
1,400 nonprofessional bargaining members in the Library of 
Congress.
    I am here today to give my support to the Library's budget 
and also to bring up a few points of difference of emphasis 
than what you probably heard from the Library's testimony last 
week. I think that the advantage to you listening to us today 
is that we can give you a behind-the-scenes look at some of the 
things that happen at the Library. The thing I want to address 
first, and I am going to ad lib, and you have our testimony so 
I will just summarize----
    Mr. Walsh. Please feel free to summarize. We have it in the 
record.
    Mr. Stern. I think the Library has the strong point we gave 
you last week about succession planning in the Library. We have 
an aging work force. The average age is in the forties. We have 
a large number of people who have been in service for 30 or 
more years. A big problem that is going to be coming up in the 
Library in the coming years is to replace the talents and 
skills of the people who will be retiring and leaving the 
Library.
    Unfortunately, at this point, and as I have emphasized to 
you last year, the Library has no career development program. 
We feel this is a tremendous waste of existing resources in the 
Library and there would be particularly a much more efficient 
use of resources if there was such a thing.
    Once again, I will just stress that I think the Library 
should be training people who are already on the staff in the 
lower levels and bringing them up to higher levels, including 
people at the lower levels from the outside and bringing them 
in. There is a tremendous amount of institutional knowledge and 
skill that exists among some of the lower grades in the 
Library, and they could easily be brought up to speed on some 
of the more sophisticated tasks that need to be done.
    Secondly, in my bargaining unit we are non-professionals. 
We discover there are 180 employees who are on stand-alone 
dead-end jobs. They are going nowhere. They are mainly in lower 
grades. Many of them are African-Americans. We feel not only 
that this points to a possible discriminatory practice, but 
also these people's talents are being waved. If they were put 
into career programs, if they were reclassified so they could 
progress up a career ladder, they could be much more useful to 
the Library and also it would increase morale.
    Last year, I brought to your attention that we have a large 
number of employees who are classified as deck attendants. They 
have to reapply for their jobs every 2 years. We discussed this 
last year. We have been in discussions with Library management 
about this in the last year. They seem to have--they are aware 
of this problem and I think they are going to rectify it, but 
they have not done so yet so I would bring that to your 
attention, bringing that up.
    The Library had developed in the last couple of years an 
internal university, which was meant to be a unified training 
program to the library. Unfortunately, we don't feel thatthe 
internal university is bringing out the potential that it really 
should. They have not centralized training in the library. There is not 
the kind of coordination there should be. We think you should be aware 
of that in terms of holding them to their promise to do that.
    Then one last thing regarding the training and talent 
nurturing category. Facilitative leadership is something that 
has been a strong topic of discussion in the last year, ever 
since General Scott came on board as the Deputy Librarian of 
Congress. He has been pushing that almost to the exclusion of 
all the other things. We see it as a fairly innocuous, possibly 
positive technique. That is not the be-all and end-all, and we 
think there should be a little bit of emphasis on things other 
than just facilitative leadership training.
    Moving on to another category, security, we second the 
Library's security concerns. There will be no Library of 
Congress if there are no collections, and those have to be 
maintained. We do feel that there is some emphasis on chalking 
up security measures that you have taken, and getting a good 
performance evaluation on the part of managers, without 
necessarily doing things that are efficient and necessary to be 
done.
    That includes things like locking doors in employee areas, 
which you can say you have locked a door, but it doesn't 
necessarily provide any good purpose. We think there is a lot 
of frenetic activity about security, and there ought to be more 
concentration on what really works and what doesn't.
    Another security concern is that a number of employees have 
been assaulted outside the Library of Congress. There is crime 
on Capitol Hill, which I am sure you are aware of. We feel the 
Library is not providing the kind of security for employees, 
and as well, for Congressmen and their staff members around the 
buildings.
    I am aware of approximately seven employees in the last 2 
years who have been assaulted, actually on the same block as 
the Library of Congress buildings. There needs to be more 
attention to physical security around the buildings. That would 
be lighting, posting more police on the beats around the 
buildings, things of that nature.
    Finally, in the security area, we understand that the 
Inspector General has had the security function and 
investigation function transferred out of his office, and we 
feel that compromises the independence of investigations in the 
Library of Congress. I believe and my organization believes 
that the Inspector General should have an independent 
investigative apparatus.
    Moving to automation, we fully support the Library's 
integrated library system. We can't say anything but positive 
comments about that. Without the integrated library system the 
Library will become a dinosaur, as I said last year. We thank 
you for providing the funds for that and we hope that you will 
be able to continue to do so.
    On the other hand, the National Digital Library, which a 
number of witnesses have spoken about, we believe is not quite 
as important an initiative. It has a lot of public appeal. The 
World Wide Web is a big thing, and it is important for us, of 
course, to have a Web site out there. But just because you get 
a million hits on a Web site doesn't mean that people are 
actually getting important information. In fact, you can have 
the same person hitting the Web site 10 times. What does that 
do to your figures?
    It is also impossible to put the resources in the Library 
of Congress, all of them--there is a vast diversity of things 
in the collection--onto the World Wide Web. Therefore we feel 
that the initiative should be continued, but the emphasis 
should be on providing support for the backbone services that 
the Library has always presented to the public; that is, 
traditional librarianship, making the hard copy pieces of the 
Library's collection available to the public.
    I would like to move on to second what Congressman 
Blumenauer and Congresswoman Morella were both saying about 
Metro fare subsidies. We are also members of the legislative 
branch, and we also feel a Metro fare subsidy would be 
beneficial to our employees, as well as helping to cut down on 
traffic congestion in the Washington area. We also have very 
limited parking for our employees, so it would be an added 
benefit.
    Last year, we reported to you that the Library was 
beginning to discuss alternative discipline, to cut down the 
high rate of disciplinary actions that were taken in the 
Library in the last few years. I would like to report that this 
is underway and we are optimistic about where that initiative 
is going.
    In the last couple of years, there has been some 
controversy about the Library's photoduplication service. A 
couple of years ago, there was an initiative to contract that 
out. It was found it was not efficient to contract out photo 
duplication service. However, we feel that at this point the 
Library lacks the initiative to make the photo duplication 
service what it should be.
    We have approximately 100 employees who work there. We feel 
that the photoduplication service can be really a cutting edge 
branch of the Library in terms of getting a pictorial and other 
resources of the Library available to the public. It should be 
working really like a private sector stock agency. If anything, 
the Library is probably the finest stock agency in the world, 
and we certainly support efforts to make it more--make that 
material more available to the public.
    I have a list here of positions in photoduplication which 
the division itself would like to fill, but which for some 
reason are meeting a stone wall and are not getting filled. I 
can develop that further if you are interested.
    Finally, I would just like to make a comment about the 
Library's constant reorganization. I think since the Library of 
Congress has come under Dr. Billington--I think he came in 
1987--the Library has been in a constant state of 
reorganization, and a lot of employees are wondering when is 
this going to end, when are we going to settle down and be able 
to get down to our jobs. It causes a good deal of 
demoralization, and we feel that particularly for 
nonprofessional employees, there is not a whole lot in it 
except a merry-go-round of changing seats and organizational 
roles.
    That concludes my testimony.
    [The information follows:]

[Pages 792 - 804--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much. You have covered a lot of 
ground. Why don't we take our break now, and then we will 
return to the other witnesses. We will be right back.
    [Recess.]
    Mr. Walsh. All right. We will continue. It is 10:20.
    Christine Schollenberger.
    Ms. Schollenberger. I am the President of AFSCME Local 
2910. I am here today with Saul Schniderman, who stepped out, 
who is our Chief Steward in the Copyright Office; and Mr. Kent 
Dunlap, who is our Chief Negotiator, and he is in the General 
Counsel's Office of the Copyright Office. In my other life I 
was a cataloguer for many years.
    Our organization represents the librarians who work in 
reference, cataloguers, acquisitions. We also represent the 
automation people, computer specialists. We represent attorneys 
in the Copyright Office and Law Library. We represent the 
nurses in the Copyright Office. We represent, I would say, 
someone probably in every field.
    Our members are generally GS-7 to GS-15, as long as they 
are nonsupervisory. We have a very talented bargaining unit, 
and I get a lot of help in doing my job.
    Once again, we want to thank you for your willingness to 
support the programs for the Library of Congress. This past 
year was notable for us in that after going through 4 years, we 
finally concluded bargaining a new contract. Unless I missed 
something, however, nowhere did I notice in the Librarian's 
testimony the other day that he addressed the subject of labor 
relations.
    With that, I want to bring to everyone's attention that the 
bargaining of a new contract is not an end, the bargaining of a 
new contract is a beginning. It is up to the parties to get 
together to bring that contract to life and make it live and 
breathe. Then it truly becomes a document where the sides can 
work together.
    I do not have as dismal perhaps a view of facilitative 
leadership as some of my colleagues do. We have had a lot of 
training. I appreciate the effort General Scott has brought 
forward to try to introduce something and train something that 
everybody has been doing, and it is a little bit like a labor 
contract.
    If people know what the rules are to meet and for decision-
making, maybe we can finally get on course where management and 
labor can work together to solve some big problems, rather than 
running around with a Band-Aid approach or putting out brush 
fires all day. If we share the same lingo and the same skills, 
maybe we can accomplish this.
    I can assure you, however, we still have to file 
grievances. We still file our unfair labor practices, but I 
think that is the nature of the relationship.
    I was very interested in your interest and concern in the 
arrearage at the Library. Of course, we are very interested in 
that, too. With the ILS looming over us, we are concerned, how 
are we going to do the everyday work? I was having a discussion 
with one of our colleagues who is an archivist, and it was very 
interesting. She said that all institutions are going to have 
arrearages. They just don't like to admit it.
    The best option that we have in a situation like that is a 
manageable arrearage, which an archivist would probably define 
in an average organization as maybe a year's amount of work in 
an area. The Library of Congress is much larger.
    The other thing she pointed out which I wanted to share 
with you is that we are now collecting the papers and records 
of 20th Century people in organizations. Quite simply, paper 
became accessible and paper became cheap. People started to use 
paper, and one of the reasons that things have grown is that 
the collections are voluminous in nature. There is a lot of 
paper. But we look forward to working on that task.
    When you asked the Librarian if he had a wish list, as far 
as I interpreted it, I was very proud of him because he 
definitely gave the right answer. We need more people and we 
need funding for people. Winston Tabb is the Associate 
Librarian and I know he has 31 positions, give or take, which I 
know are important for the succession planning, and some are 
crucial for us to continue to do our jobs.
    However, while we need these new positions, I would echo 
Mr. Stern's concern that we need better utilization from people 
within. We need more promotion opportunities and leadership 
opportunities for the people who are working there. My 
bargaining unit is not going to be real happy if you go out and 
hire some people who are at a higher grade and bring them in, 
and you expect us to pass on our expertise. That does not make 
for a happy mix in the workplace.
    In addition, I think we need continued flexibility. A lot 
of the work that was done on the arrearage was done quite 
simply at night, a lot was done on Saturday. It was done in 
allowing employees to have flexible work schedules. These 
became conditions of employment. I think we have to keep that 
in mind and make this a real condition. We can no longer pay 
people that much. Sometimes you have to give some more things. 
I think flexibility in the workplace is important, especially 
for so many of our employees who don't necessarily work with 
the public.
    I think you will note that our printed testimony virtually 
supports the Library entirely except for two exceptions, one of 
which is the proposed security plan. I think it speaks for 
itself. I would like to zero in, however, and play piggyback on 
Joel, that with the passage of the District of Columbia Police 
Coordination Act of 1997, this enlarges the potential 
jurisdiction of the Library ofCongress police, and I understand 
what this does further. It allows relationships to develop between say 
the Capitol Police and the Metropolitan Police.
    With the closing of the doors at the Library, okay, this is 
something that has been crucial, because there is no longer a 
police presence. Say over on the avenue next where you are 
walking, there used to be a door open and people would walk out 
into that neighborhood. There would be a police presence there, 
because there would be police at the doors. That is no longer 
there. We have requested the Library to look into this, and 
they have been silent on the issue. I echo the fact that I 
understand at least seven people have been mugged in that area 
in the last year.
    The second exception that I have is with providing any 
additional funding for the GLIN project in the Law Library. 
Again, I believe our testimony speaks for itself. We support 
the finding 100 percent for the additional reference positions 
and technical support.
    Our people have been working 60-hour weeks. They have 
someone there at night when you are in session. They have been 
working on a very, very small staff with rotations, and they 
have had a lot of overtime. We are 100 percent behind that. We 
do have some questions about the GLIN project at this time. 
Again, I think our testimony speaks for itself.
    Thank you again for this opportunity and I am here to 
answer any additional questions.
    [The information follows:]

[Pages 808 - 816--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much.
    Next, Mr. Roth, CRS.
    Mr. Roth. Thank you, Mr. Chairman. I guess I should also 
declare my RPCV status. I think we talked about this last year.
    Mr. Walsh. Yes, we did.
    Mr. Roth. I was in the Philippines from 1968 to 1970.
    Mr. Walsh. I was in the Philippines on the way to Nepal. We 
were in Sinaloa, the International Rights Institute in Laguna 
Province. We were there in July, I think, July of 1970 on our 
way to Nepal.
    Mr. Roth. I was just leaving the country in July, so maybe 
in Manila we saw each other. Planes were coming and going.
    Mr. Walsh. Good to have you with us.
    Mr. Roth. Thank you, Mr. Chairman and Mr. Serrano. My name 
is Dennis Roth. I am President of the Congressional Research 
Employees Association at the Library of Congress, representing 
over 400 members and over 600 bargaining unit employees. Along 
with me today are our two Vice Presidents, Angela Smith, our 
Vice President for Training and Liaison, and Mr. Jonathan 
Contrubis, Vice President for Policy and Dispute Settlement.
    We are proud that we are able to maintain our membership 
rate of between 65 and 70 percent. As you know, in the Federal 
sector it is a voluntary joining. It is not mandatory, and to 
keep that rate is pretty good.
    I, too, will try to summarize my testimony, since you 
already have the written document. I guess our major concern is 
that even after years of the Library being told to do better in 
terms of its overall management, which I call the internal 
infrastructure, it still does not seem to function very well.
    We know that Congress does not like to micromanage any of 
its agencies. We are not asking you to micromanage. But I think 
we are asking you to maybe make it do what it does better. We 
are not under GPRA, so we don't look at what we are doing and 
how well we are doing it. When the unions try to do this, when 
we get things to negotiate, we say, this program is geared to 
deal with this problem and hopes to come up with this solution. 
We ask, can you tell us, give us the data, how much money have 
you spent, who has participated in it, and what has been the 
results? We can't get those kinds of data. So we get frustrated 
in trying to come up with different programs, better programs, 
or support the program that is already on the books. It is very 
frustrating. It really prolongs our negotiations.
    Also, we have extreme difficulty in bringing the Library 
into the 19th Century, let alone the 20th Century in terms of 
labor relations. It is still the old adversarial relationship 
when we sit down at the table. There is a new form of 
bargaining that has been tried, interest-based bargaining. I 
have participated in it many times. I have been an advocate of 
it. We have asked the Library to try it. We even had people 
from the Department of Defense, who are really pushing it, come 
and give some training. But to date, we can't do it, so we are 
engaged in this type of collective bargaining that takes longer 
than it should. It gets acrimonious, and it is just not a good 
way of doing business.
    Yet, I think the unions are told, well, we can't get 
anything done in the Library because we have to negotiate with 
the unions. It is not the union's desire to make things take as 
long as they do. It is the form, and then we also have problems 
in getting responses. As I note in my testimony, we are in 
master contract negotiations right now. We gave the Library 
proposals on a new performance evaluation system for our staff 
for staff recognition and for upward mobility last June. They 
still haven't been able to come back with a counterproposal on 
those issues.
    We strongly believe that it is because they are not putting 
the time into it that would be required. If we were serious 
about labor relations, we could probably take a month, maybe 6 
weeks off face to face and probably wrap this whole thing up. 
Instead, we are into the beginning of year 3 now with our 
negotiations. We meet twice a week 3 hours at atime. To deal 
with a contract that has over 50 articles in it, you could imagine what 
progress you will make in such short time frames. This is not at our 
behalf. We wanted to meet 3 days a week full-time, but the best we can 
get out of management was the twice a week, 3 hours at a time.
    In our analysis of the Library, we have identified four 
interrelated problems that hinder us from moving forward. 
First, there is a stronger resistance to change unless they 
have come up with it. If staff come up with the ideas, it is 
``why,'' and they find ways of not doing it. If there is a 
roadblock--if you want to do something, you say, okay, that is 
a roadblock, how can we get around it.
    When we deal with something in the Library that is a 
roadblock, they say we can't go any further, come back with 
something totally different. It is a totally sort of negative 
approach to these types of issues. There is an inability to 
come to closure quickly on most issues.
    I mentioned the issue of our master contract. We are also 
trying to do an affirmative employment program. We gave the 
Library a counterproposal late last year and we are still 
trying to wait for, again, a response. When it gets back, I 
don't know where it goes when it gets to management's level, 
but it seems to churn somewhere on the sixth floor of the 
Library forever and a day. We ask directly what is going on, 
but it just doesn't happen.
    I already mentioned that the Library has not and cannot 
determine if the human resource programs and policies it 
employs accomplish what they are set out to accomplish. For 
another example, in the affirmative action employment program 
we have a tuition support element of this. The whole concept is 
to give people training so they can make job transitions into 
new areas. We asked for data on this. It is probably the 
highest funded part of the affirmative employment program. Yet, 
nobody knows if it was successful. In our counterproposal we 
tried to have something that would demonstrate and make it more 
successful.
    Fourth, the Library often fails to conduct long-run 
planning before it implements various programs. I notice in the 
Librarian's plan--I think he talked about this Library of 
Congress strategic plan. This is a sixth floor plan. This is 
nothing that the staff have been really briefed in. We have not 
had general meetings, and the staff--this is just something to 
put perhaps under the bird cages, if we had any in the Library, 
because they have not taken the effort to convince us or to 
work with us on where we want to go over the next 10 years. It 
is frustrating for us and it must be frustrating for them, 
because you can't move in unison towards a common goal.
    The point of facilitative leadership is to bring decision-
making down to the lowest level possible; i.e., empowerment of 
staff. In CRS we have not seen the bringing down of that level 
to empowerment. If we are going to spend all this money on 
training for these various issues, then it should become a 
modus operandi and not another buzz word that, who knows, 10 
years there from now there may be a new thing.
    We have been through consultative management. We have been 
through diversity, through partners in change. It is not for 
lack of trying, it is just that the leadership at the top is 
not making it happen. The staff do want to see change. They do 
want to get the empowerment, but we are not moving in that 
direction.
    Let me now move more directly to address the CRS budget. We 
do strongly support his request for the mandatories, the 
succession initiative, with certain modifications, and the 
funding of price level increases. We need full-funded mandatory 
personnel costs just to maintain the staff that we already 
have.
    As I walk through the divisions, because I strongly believe 
in shop floor management, I talk to the people who are working 
for you, the Congress, and many are getting burnt out. We are 
told to work smarter and harder, but I think we are working as 
smart as we can, and now the drums just get faster and faster, 
because there is not enough staff to do everything which you 
are asking us to do.
    For this reason, we differ with the Director's decision to 
fill a lot of the high-level management positions, particularly 
those assistant chief positions in our research divisions. We 
need the analysts, the technicians, the clerical help to answer 
the requests directly to you first. We have in the past and we 
can in the future fill these management positions by rotating 
our own staff into it on a temporary basis. We don't lose as 
much. With the money that we have, we really need to fill 
positions that directly respond to the Congress.
    We also have, I think for an organization of our nature, 
too many people in a supervisory and management position. I did 
a calculation this week based on our phone book that just came 
out, which is sort of our organizational chart. We have a ratio 
of 4.7 employees to every manager. So that is five employees 
per one manager or supervisor. That is not across all--each 
division is a little different. Some are much better, but 
obviously some are pretty poor if we come up with an average 
for the total service----
    Mr. Walsh. That is at CRS?
    Mr. Roth. Yes. We think that needs to be dealt with. We 
need more direct service people to the Congress.
    We also think we need to recruit better. CRS for a long 
time has been managed by white males, even though there has 
been a large effort to go out and recruit people to fill 
positions otherwise. They have been sending out two of the top 
level people in the organization, the Deputy Director and the 
Associate Director for Research and Technology, to do a lot of 
the recruiting. Yet, when we talk to the Director about why is 
it that we can't get people into senior level positions of a 
more diversified background for race and sex, he tells us that 
the people that are being recruited don't make it into the 
interview panel. They do get them to apply for positions, but 
when they are rated, they don't make it into the panel for 
those people who can be considered for the positions.
    So something is wrong here. This is the other case where 
they need to go back and say, we need to stop this type of 
recruiting and figure out what it is that doesn't allow us to 
capture these people where they really need to be, so we can 
deal with some of our problems in diversity.
    Regarding the succession initiative, based on what I told 
you earlier, we support it wholeheartedly. However, as Joel had 
talked about, the difference between the CRS--we also want some 
internal upward mobility. We have staff in other positions who 
have gone on and gotten degrees, or who could receive training. 
That could be a good start for this succession initiative. We 
don't need to just search on the outside all the time for 
employees.
    Therefore, we would ask you to maybe put some trainingmoney 
into the succession initiative and just not money to search for the 
outside.
    Mr. Walsh. Mr. Roth, I would ask you if you could wrap up. 
Both of us have other committee meetings we have to get to.
    Mr. Roth. The last issue I would like to talk about would 
be about information technology. As we are moving in this 
direction, technology is a tool or a means towards an end and 
not an end in itself. We need to get technology that allows us 
to use what is out there in terms of what is developing, but at 
the same time not be a hindrance to us.
    I mentioned in my testimony that CD-ROM seems to be the 
direction, and you heard this morning about how important CD-
ROMs are. Yet, we have very few CD-ROM machines in the 
analytical divisions. In fact, one division has one machine for 
40 analysts.
    To deal with this, we also need people to help with the way 
we catalog and do all our information. This means people who 
used to deal with manila files now have to deal with electronic 
files, so this takes training to bring these people into the 
new way of doing business. We want you to feel that we can give 
you the best service we can, but if we just go through an 
electronic search and get hits--I talk to my colleagues in the 
Foreign Affairs Division, and when they want to talk about 
anything with arms in it, they get all these biology hits. Then 
you have to weed through it all the time. You need somebody 
there to do the sifting, so when you get what you ask for, you 
are getting it. That way we can do better for you.
    We are short-staffed already. Imagine the frustration. We 
want to see what is out there to give you the best information, 
and then we have to weed through all this information to figure 
out what that information is, there. It is not an efficient way 
of doing business.
    That concludes the concerns I would like to raise for you.
    [The information follows:]

[Pages 821 - 830--The official Committee record contains additional material here.]


    Mr. Walsh. Thank you very much. Thank you all very much for 
your testimony. Obviously, you have your fellow employees' 
needs in mind in your testimony. I think you have represented 
them very well.
    I just want to reassure you all that we are also very 
concerned about security and safety of employees. We want 
people to feel--not only to feel safe, but to be safe. This 
subcommittee also funds the Capitol Hill Police budget and we 
want to make sure that they have the resources that they need 
so that people not only feel safe, but indeed are safe. That is 
of critical importance.
    You mentioned a number of collective bargaining issues that 
we really won't interfere with or involve ourselves with. I 
would think if the library came to us and asked us to help them 
with an issue or two, they would probably advise us to not 
micromanage. But we would urge both parties, the Library and 
the units, to bargain in good faith to try to resolve some of 
these longstanding issues.
    Certainly, this issue that Mr. Stern raised regarding 
employees having to recertify every 2 years is an issue that 
maybe we can do a little research on and try to clarify why 
that is. Maybe it is something we asked them to do. If it is, 
then we can probably clear that up. I don't know. But we would 
be glad to take a look at that.
    Mr. Stern. I appreciate that. Thank you.
    Mr. Walsh. Sort of the operational issues, we will just do 
our best, given finite resources, to fund them. I know if they 
have proper funding, it will be easier to meet the needs that 
you folks have, and your colleagues. We will do our best. That 
is all I can tell you.
    Mr. Roth. If I might just add to it, you said on Mr. 
Stern's concern about these 2-year employees, if you recall, in 
1994 there was a death at the Lincoln Memorial of an employee 
who was in a similar circumstance.
    OPM changed its regulations to deal with a lot of those 
problems. The Library, not being an executive branch agency, 
did not adopt those. So we are currently in master contract 
trying to bring those into the Library, but you may want to 
look at that in terms of solving a lot of the problems that we 
are facing.
    Mr. Walsh. We will take a look.
    Mr. Serrano.
    Mr. Serrano. Very briefly to echo your comments, it is in 
our best interests that the folks who work at the Library get 
fair treatment and have security, good security. There are some 
things that we are concerned about. In fact, I would appreciate 
it if you, Mr. Roth, would write to me and to the committee and 
let us know more about the whole issue of how people don't make 
it onto the panel. I was very interested in that.
    From you, Mr. Stern, the whole issue--you mentioned 
training. I know we spoke about different trainings. I would 
like for you later on--because we have this terrible conflict 
today of seven meetings at the same time that we all have to be 
at, and Mr. Walsh is Vice Chairman on another committee that he 
has to be at----
    Mr. Walsh. We have Secretary Glickman's decision on dairy 
policy that is going to dramatically affect my farmers, so I 
have to go.
    Mr. Serrano [continuing]. And we have the Loretta Sanchez 
case on the floor right now, so I can tell you, that is 
exciting. But I would like for you to let the committee know in 
writing later what training you were referring to. You just 
said there is no training, and that is kind of a scary thought.
    Mr. Stern. I will be glad to.
    Mr. Walsh. Thank you all very much.
    The subcommittee hearing is completed, and let me just 
thank staff. This is the end of our hearing process in the 
first go-around. I want to thank Ed Lombard and Tom Martin, our 
staff, Art Jutton, Johanna Kenny, Lucy Hand and Mr. Serrano's 
staff. Everybody worked very, very closely together. Thank you.
    Mr. Serrano. Thank you.
    [Clerk's note.--House Report 105-254, the Conference Report 
accompanying H.R. 2209, Making Appropriations for the 
Legislative Branch for the Fiscal Year Ending September 30, 
1998, and for Other Purposes, directed ``the Comptroller 
General of the United States, the Public Printer, the Capitol 
Police Board, the Clerk of the House, the Secretary of the 
Senate, and the Librarian of Congress, as well as the Senate 
Sergeant at Arms and the Architect of the Capitol to report to 
their respective Committees on Appropriations on a plan that 
would incorporate alternative fuel vehicles into their fleets 
consistent with their needs and requirements of the Energy 
Policy Act of 1992.'' The reports submitted to the House 
Appropriations Committee follow:]


[Pages 833 - 842--The official Committee record contains additional material here.]












                               I N D E X

                              ----------                              
                                                                   Page
Architect of the Capitol.........................................   435
    ADA Improvements.............................................   492
    Appointment of the Architect of the Capitol..................   494
    Botanic Garden Conservatory..................................   488
    Capital Budget...............................................   486
    Capital Projects.............................................   490
    Capitol Dome Project.........................................   502
    Capitol Visitors Center......................................   496
    Cogeneration Facility........................................   505
    Culpeper Facility............................................   506
    Cyclical Reinvestment........................................   497
    East Plant Chiller...........................................   505
    Employee Union...............................................   500
    Human Resources..............................................   493
    Human Resources Problems.....................................   498
    Longworth Building Elevators.................................   504
    Longworth Building Roof......................................   491
    Off-site Storage Facility....................................   506
    Opening Remarks..............................................   435
    Opening Statement............................................   435
    Overall Increase.............................................   485
    Oversight of the House and Senate............................   495
    Private Contractors..........................................   488
    Reprogrammings...............................................   510
    Security.....................................................   492
    Shower Facilities............................................   508
    Solid Waste Disposal.........................................   504
    Staffing Levels..............................................   487
    Waste Recycling..............................................   508

Congressional Budget Office......................................   635
    A Prudent Budget Request.....................................   637
    CBO's Cost Estimates on the Web..............................   661
    CBO's New Web Site...........................................   661
    CBO's Budget Request.........................................   636
    Changes in CBO's Baseline Assumptions........................   657
    Concerns About Staff Recruitment and Retention...............   636
    Difficulties in Retaining Highly Qualified Staff.............   665
    Employee Compensation at CBO and Other Organizations.........   664
    How the Asian Financial Crisis Affected CBO Projections......   656
    Increased ``Transparency'' for CBO's Cost Estimates..........   662
    Methods for Developing Bill Cost Estimates...................   662
    New CBO Products.............................................   635
    Other Recruitment Incentives.................................   665
    The Income Tax System's Marriage Penalty.....................   656
    The Search for a New Mainframe Services Vendor...............   658
    Upcoming Costs for Relocating ADP Systems....................   637
    Using Internet Technologies for Administration...............   662

General Accounting Office........................................   541
    Building Renovation Project..................................   551
    Fiscal Year 1999 Budget Request..............................   542
    Staffing and Performance.....................................   549
    Use of Outside Contractors...................................   551

Government Printing Office.......................................   671
    Bound Congressional Record...................................   689
    Capacity.....................................................   693
    Department of Defense Printing...............................   690
    Document Distributions.......................................   683
    Document Management System...................................   688
    Introduction of Witnesses....................................   671
    Public Printer's Statement...................................   673
    Rates........................................................   694
    Transition to Electronic Documents...........................   687

Joint Committee on Printing......................................   703
Joint Committee on Taxation......................................   557
    Mr. Archer's Opening Statement...............................   590
    Macroeconomic Analysis.......................................   590
    National Sales Tax...........................................   591
    Revenue Estimates............................................   594
    Work of JCT This Year........................................   595
    Overlapping Functions........................................   596

Joint Economic Committee.........................................   423
    FY 1999 Hearing Costs for JEC................................   430
    JEC Contribution to Budget Issues............................   430
    Mr. Saxton's Opening Statement...............................   423

Legislative Branch Financial Managers Council....................   227
    Architect's Financial System.................................   239
    Common Financial System......................................   239
    Consolidated Audit...........................................   240
    LBFMC Activities.............................................   229
    Standard General Ledger Accounting...........................   239

Library of Congress..............................................   243
    Arrearage....................................................   284
    Book Cost....................................................   394
    Budget Request...............................................   243
    Cataloging Arrearage.........................................   302
    Committee Vote for Executive Session.........................   334
    Copyright Issues.............................................   339
    CRS Intern Recruit Program...................................   380
    CRS Succession Plan..........................................   375
    CRS..........................................................   350
    Deputy Librarian's Statement.................................   280
    Digitization Goals...........................................   309
    Film Preservation............................................   299
    Financial Audit..............................................   280
    Foreign Language Services....................................   392
    Impact of an Ever-Increasing Internet-User Base..............   305
    Impact of Potential Large-Scale Retirement...................   303
    Librarian's Statement........................................   244
    Library Bicentennial.........................................   244
    Library's Vision.............................................   355
    Mandatory Increases..........................................   281
    National Audio-Visual Conservation Center....................   295
    National Digital Library.....................................   307
    National Library Service for Blind and Physically Handicapped   381
    Off-Site Storage.............................................   295
    Off-Site Storage Locations...................................   297
    Opening Remarks..............................................   243
    Other Library Office Locations...............................   298
    Prepared Statement (Director of CRS).........................   341
    Prepared Statement (Librarian of Congress)...................   245
    Prepared Statement (Register of Copyrights)..................   366
    Priority Budget Items........................................   280
    Providing Information--Not Interpretation....................   304
    Public Dissemination of CRS Products.........................   351
    Security.....................................................   312
    Selection of Books...........................................   392
    Strategic Plan...............................................   280
    Talking Book Program.........................................   381
    Year 2000 Challenge..........................................   306

Office of Compliance.............................................   177
    ADA Compliance...............................................   221
    Administrative Costs Paid to Library of Congress.............   223
    FY1999 Budget Request........................................   222
    Legislative Branch Compliance with Congressional 
      Accountability Act.........................................   221
    Mr. Fazio's Questions........................................   224
    Mr. Hoyer's Comments.........................................   226
    Mr. Nager's Statement........................................   177
    Mr. Serrano's Questions......................................   224
    Ms. Silberman's Statement....................................   180
    Pending Cases................................................   222

U.S. Capitol Police..............................................   599
    Chief Abrecht's Opening Statement............................   615
    FTE Increase.................................................   622
    Mr. Casey's Opening Statement................................   604
    Mr. Hantman's Prepared Statement.............................   609
    Mr. Livingood's Opening Statement............................   599
    Police Parity Pay Request....................................   623
    Request for General Expenses.................................   627
    Status of Labor/Management Negotiations......................   625

U.S. House of Representatives....................................     5
    Allowances and Expenses......................................   151
    Attending Physician..........................................   150
        Response to Chemical or Biological Threat................   150
    Chaplain, Office of the......................................   108
    Chief Administrative Officer.................................    58
        Balance of Joint Offices.................................   158
        Balance of Officers and Employees........................   106
        Child Care Center........................................    87
        Closing Remarks..........................................   162
        Direction of HIR.........................................    77
        Discussion on Competition for High Quality Technology 
          Personnel..............................................    81
        Discussion on Timely Voucher Processing..................    85
        Fiscal Year 1999 Budget Submission.......................    70
        Fiscal Year 1999 Estimates...............................     9
        Future of HIR............................................    79
        HIR Questions............................................    77
        HIR Staffing Concerns....................................    80
        Improvement on Voucher Processing........................    83
        Key Technology Products..................................    71
        Mail Delivery Frequency..................................    76
        Mainframe Migration......................................    71
        Major Expenditures.......................................    75
        Mr. Eagen's Background...................................     7
        Mr. Eagen's Opening Statement............................     8
        New Services of HIR......................................    78
        Payroll System...........................................    71
        Postal Operations........................................    72
        Quarterly Mass Mailing Reports...........................    82
        Videoconference Technology...............................    79
        Year 2000 Ad Hoc Systems.................................    74
        Year 2000 Issues.........................................    72
    Clerk, Office of the.........................................    32
        Document Management Initiative...........................    45
        Document Management System...............................    34
        Employment Policies......................................    50
        Fiscal Year 1999 Budget Submission.......................    34
        Floor Vote Information...................................    35
        HIR Mainframe Computer...................................    51
        House Voting Cards.......................................    36
        Legislative Resource Center..............................    36
        Lindy Boggs Congressional Reading Room...................    46
        Opening Statement........................................    34
        Reorganization of the LRC................................    46
    Committee on Appropriations..................................    27
    Corrections Calendar Office..................................   112
        Clarification of Corrections Calendar Office.............   127
    General Counsel, Office of...................................   107
    House Leadership Offices.....................................    12
    Inspector General, Office of.................................    88
        Accomplishments..........................................    90
        Calendar Year 1998 Planned Audits........................    90
        Discussion on Year 2000..................................   101
        Fiscal Year 1999 Budget Request..........................    90
        HIR Mainframe Migration..................................   101
        Implementation of Personnel Policies.....................   104
        Member Mass Mailing Recommendations......................   103
        Opening Statement from the Inspector General.............    90
        Progress with the Financial Management System............   102
    Law Revision Counsel, Office of the..........................   110
    Legislative Counsel, Office of the...........................   111
    Members' Representational Allowances.........................    25
    Mr. Hoyer's Statement........................................    84
    Other Authorized Employees...................................   113
    Parliamentarian, Office of the...............................   109
    Salaries, Officers and Employees.............................    30
    Sergeant at Arms, Office of the..............................    52
        Fiscal Year 1999 Budget Submission.......................    54
        Emergency Evacuation Procedures..........................    57
        Explanation of 1997 Increase.............................    57
    Standing Committees, Special & Select........................    27