    [Senate Hearing 105-264]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 105-264

             LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1998

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

                                    HEARINGS

                                    before a

                              SUBCOMMITTEE OF THE

                COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                           ONE HUNDRED FIFTH CONGRESS

                                 FIRST SESSION

                                       on

                               H.R. 2209/S. 1019

    AN ACT MAKING APPROPRIATIONS FOR THE LEGISLATIVE BRANCH FOR THE FISCAL
             YEAR ENDING SEPTEMBER 30, 1998, AND FOR OTHER PURPOSES

                                   __________

                 Architect of the Capitol (except House items)
                              Capitol Police Board
                          Congressional Budget Office
                           General Accounting Office
                           Government Printing Office
                          Joint Committee on Printing
                          Joint Committee on Taxation
                            Joint Economic Committee
                              Library of Congress
                           Nondepartmental witnesses
                              Office of Compliance
                                  U.S. Senate

                                   __________

             Printed for the use of the Committee on Appropriations

     Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                     senate

                          U.S. GOVERNMENT PRINING OFFICE
     39-862 cc                   WASHINGTON : 1997
    _______________________________________________________________________
                For sale by the U.S. Government Printing Office
    Superintendent of Documents, Congressional Sales Office, Washington, DC
                                     20402

                          COMMITTEE ON APPROPRIATIONS

                         TED STEVENS, Alaska, Chairman
    THAD COCHRAN, Mississippi            ROBERT C. BYRD, West Virginia
    ARLEN SPECTER, Pennsylvania          DANIEL K. INOUYE, Hawaii
    PETE V. DOMENICI, New Mexico         ERNEST F. HOLLINGS, South Carolina
    CHRISTOPHER S. BOND, Missouri        PATRICK J. LEAHY, Vermont
    SLADE GORTON, Washington             DALE BUMPERS, Arkansas
    MITCH McCONNELL, Kentucky            FRANK R. LAUTENBERG, New Jersey
    CONRAD BURNS, Montana                TOM HARKIN, Iowa
    RICHARD C. SHELBY, Alabama           BARBARA A. MIKULSKI, Maryland
    JUDD GREGG, New Hampshire            HARRY REID, Nevada
    ROBERT F. BENNETT, Utah              HERB KOHL, Wisconsin
    BEN NIGHTHORSE CAMPBELL, Colorado    PATTY MURRAY, Washington
    LARRY CRAIG, Idaho                   BYRON DORGAN, North Dakota
    LAUCH FAIRCLOTH, North Carolina      BARBARA BOXER, California
    KAY BAILEY HUTCHISON, Texas
                       Steven J. Cortese, Staff Director
                     Lisa Sutherland, Deputy Staff Director
                   James H. English, Minority Staff Director
                                     ------

                     Subcommittee on the Legislative Branch

                       ROBERT F. BENNETT, Utah, Chairman
    TED STEVENS, Alaska                  BYRON DORGAN, North Dakota
    LARRY CRAIG, Idaho                   BARBARA BOXER, California
                                         ROBERT C. BYRD, West Virginia
                                           (ex officio)
                               Professional Staff
                               Christine Ciccone
                          James H. English (Minority)

                                C O N T E N T S

                                  ----------

                              Tuesday, May 6, 1997

                                                                       Page
    Joint Committee on Printing......................................     1
    Joint Economic Committee.........................................     7
    Joint Committee on Taxation......................................    13

                             Tuesday, May 20, 1997

    Capitol Police Board.............................................    45
    Congressional Budget Office......................................    91

                             Thursday, June 5, 1997

    Library of Congress..............................................   105
    Government Printing Office.......................................   199
    General Accounting Office........................................   227
    Nondepartmental witnesses........................................   243

                             Tuesday, June 10, 1997

    Office of Compliance.............................................   249
    U.S. Senate:
        Office of the Secretary of the Senate........................   265
        Office of the Sergeant at Arms and Doorkeeper................   299
    Architect of the Capitol.........................................   315

             LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1998

                                  ----------

                              TUESDAY, MAY 6, 1997

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10:05 a.m., in room S-128, the
    Capitol, Hon. Robert F. Bennett (chairman) presiding.
        Present: Senators Bennett and Dorgan.

                          JOINT COMMITTEE ON PRINTING

    STATEMENT OF HON. JOHN W. WARNER, CHAIRMAN
    ACCOMPANIED BY ERIC C. PETERSON, STAFF DIRECTOR

                  opening statement of hon. robert f. bennett

        Senator Bennett. The subcommittee will come to order. This
    is the first of four hearings that the Legislative Branch
    Subcommittee will hold on the budget request for the fiscal
    year 1998.
        I am the new chairman of this subcommittee. I welcome the
    opportunity to participate in the oversight responsibilities of
    the committee as they pertain to the appropriations programs
    and activities of the legislative branch of our Government. I
    understand Senator Dorgan, who is the new ranking member, will
    be along shortly. I have been privileged to serve on this
    committee under the chairmanship of Senator Mack, and will do
    my best to carry on in his tradition.
        We welcome Senator Warner here. He is chairman of the Joint
    Committee on Printing, and our first subject this morning is
    the budget request of the Joint Committee on Printing.
        The request in fiscal 1998 is $804,000, which is a $27,000
    increase from the 1997 level of $777,000. Senator Warner, we
    welcome you, and we will be happy to receive your testimony.

                             introduction of staff

        Senator Warner. I thank you very much, Mr. Chairman.
        May I first introduce Col. Grayson Winterling, who is staff
    director of the Rules Committee, which has sort of ancillary
    responsibility, and Mr. Eric Peterson, who is the staff
    director of the Joint Committee on Printing. I will submit my
    entire statement for the record, Mr. Chairman, and cover some
    of the high points.

                               opening statement

        The point I wish to make is under the leadership of Senator
    Stevens, my predecessor on the Rules Committee as chairman, we
    have been looking at title 44. Title 44 is an interesting piece
    of legislation. However, over a period of years there has been
    a creeping tendency on the part of a number of departments and
    agencies of the Federal Government to violate it.
        Now, the degree to which it is violated, that is maybe lost
    in semantics, but I say there is certainly a technical
    violation. It is not good, honest Government employees trying
    to break the law, but for various reasons practices have grown
    up whereby the departments and agencies have made in-house
    printing facilities which now serve their needs and have not
    gone through the Government Printing Office, so I am continuing
    the work started by Senator Stevens on what we call title 44
    reform.

                    legislative proposal to revise title 44

        From a concept paper, a legislative proposal has been
    drafted, and that proposal has been the subject of one hearing
    before the Rules Committee, and there is another one planned
    here in a few days. Based on the recommendations received
    during these hearings and other comments submitted for the
    record, the staff of the Joint Committee on Printing in
    cooperation with the Senate Rules Committee will redraft the
    legislative proposal.
        It is my hope to introduce a reform bill in a matter of
    months, and do it on a bipartisan basis. There is really no
    politics at all involved in this thing. It is just a question
    of what is the intent of the legislative branch and the
    executive branch to solve the problem. That problem is a
    constitutional one that is involved with the separation of
    powers. It stems from a 1983 Supreme Court decision in the case
    of the Immigration and Naturalization Service v. Chadha.
        I mention that because it is quite well-known through
    Government circles, and everybody sort of looks the other way,
    but it is the responsibility of both the legislative and
    executive branches to solve this tough problem.
        Now, the Justice Department Office of Legal Counsel wrote
    an opinion last year which construed the committee's
    involvement with the Government Printing Office to be the
    equivalent of exercising a legislative veto over the printing
    activities of executive branch agencies and thus a violation of
    the separation of powers doctrine.
        In the face of that opinion, it is difficult for the
    committee to obtain executive branch compliance with title 44.
    Some executive branch agencies either are procuring printing
    without going through the GPO, or doing printing for other
    agencies, or doing theirs in-house, and a mix of all of the
    above.
        As I say, at the moment I describe these practices as a
    technical violation of title 44.
        Now, the question before the Rules Committee is whether
    these are violations costing the taxpayers added dollars? Are
    they costing the taxpayers a reduced accessibility to a lot of
    the information created by the Government?
        So I just urge the committee to approve this budget.
    Hopefully, we will answer these questions this year, Mr.
    Chairman. I am determined to do so. I view this budget as in
    the public interest because it funds the committee that must
    resolve this public policy question between the legislative and
    executive branches. It cannot go on.

                               prepared statement

        So with that, I will just submit the balance of my
    testimony and I will be happy to respond to your questions, Mr.
    Chairman.
        [The statement follows:]
                   Prepared Statement of Senator John Warner
        Mr. Chairman, Members of the Committee. I appreciate the
    opportunity to appear before you today on behalf of the Joint Committee
    on Printing, and its budget request of $804,000 for fiscal year 1998.
    Rather than reiterate the testimony I provided the House Legislative
    Branch Appropriations Subcommittee in February, I will give you an
    update on the Joint Committee's initiative to reform Title 44.
                                title 44 reform
        The Joint Committee on Printing has adopted by consensus a concept
    paper on Title 44 reform. From this concept paper a legislative
    proposal has been drafted. That proposal has been the subject of one
    hearing before the Senate Rules Committee. A second hearing is planned
    for May 8th. Based on the recommendations received during these
    hearings, and other comments submitted for the record, the staff of the
    Joint Committee on Printing, in cooperation with the Senate Rules
    Committee, will redraft the proposal for submission as a bill. It is my
    hope to be able to introduce a reform bill this spring on a bicameral,
    and bipartisan basis with the support and participation of the
    Administration. The legislation will address two key policy issues.
        The first is the constitutional separation of powers issue which
    stems from the 1983 Supreme Court decision in the case of the
    Immigration and Naturalization Service v. Chadha. Those of you familiar
    with the Joint Committee on Printing know that the Committee acts like
    a board of directors over the operations and activities of the
    Government Printing Office. The Justice Department's Office of Legal
    Counsel wrote an opinion last year which construed the Committee's
    involvement with the Government Printing Office to be the equivalent of
    exercising a legislative veto over the printing activities of Executive
    Branch agencies, and thus a violation of the Separation of Powers
    doctrine. In the face of that opinion it is difficult for the Committee
    to obtain Executive Branch compliance with Title 44. Some Executive
    Branch agencies either are procuring printing without going through
    GPO, or doing printing for other agencies. Both of these practices are
    a violation of Title 44, and are costly to the American taxpayer.
        The second key issue is to ensure that Title 44 provides for
    permanent public access to government information and publications.
    Because agencies in all three branches of the Federal government are
    violating the procurement provisions of Title 44, they are also
    violating the public access provisions as well. Government information
    produced at taxpayer expense must go to the Federal Depository Library
    Program.
        I want to make clear at the outset that this proposal is only a
    starting point. Therefore, it is premature to suggest that any of its
    provisions reflect how the bill ultimately will be drafted. The
    Committee will work closely with this Subcommittee to ensure that all
    appropriate budgetary considerations are made, and that you have
    appropriate opportunity to comment and prepare for whatever changes the
    bill ultimately authorizes.
        Mr. Chairman, my colleague Mr. Ford has a statement he wishes
    entered in the record.
        I thank the Committee for its attention.

                     costs relating to Title 44 violations

        Senator Bennett. Thank you.
        May I ask if you have any kind of sense on the issue of
    cost with respect to these technical violations of title 44
    that you referred to?
        Senator Warner. So far as I know, we have not got any
    costs.
        Mr. Peterson. We do not have any firm, reliable data. The
    Government Printing Office estimates the Government spends
    approximately $1.2 billion a year, and of that amount about
    $494 million does not flow through the GPO.
        Senator Bennett. But do they have any general sense that,
    in fact, this is costing more, or that there are savings and
    that the only issue is a turf issue, and I understand the Rules
    Committee has not completed its work, but do you have any sense
    on this?
        Mr. Peterson. The general sense we have is that again,
    based upon GPO's analysis of this matter, that those printing
    costs could probably be reduced by about 25 percent overall.
        Senator Bennett. So if that number is right, that would be
    roughly $100 million.
        Mr. Peterson. The savings would be approximately $300
    million. The total cost would come to $900 million.
        Senator Bennett. It would be one-quarter of that which is
    not being done by GPO, and that's only $400 million.
        Mr. Peterson. No; one-quarter of the Government's total
    printing cost, $300 million.
        Senator Warner. Let me describe to the chairman an example
    quite apart from the dollars, and I will not mention the
    agency's name, but it is a clearly documented case.
        The agency has employees whose salary is paid by the
    taxpayer. They do a body of research. That body of research is
    incorporated into a very important written report. This agency
    then sends that written report to a private sector company
    which publishes that report, and sells that report.
        Now, the taxpayer does not have access to that report
    unless he or she goes out and buys a copy of the private
    sector-produced journal, and we think that is wrong. That is
    basically what we are trying to fix.
        Now, that cannot be extrapolated into dollars and cents,
    but that is probably the more serious problem, as I see it.

                              GPO's revolving fund

        Senator Bennett. OK. You testified on the House side that
    the GPO's revolving fund is at a dangerously low level. Can you
    give us, either now or for the record, what the balances of
    that revolving fund are?
        Senator Warner. I do not have that figure.
        Mr. Peterson. We can provide that for the record.
        [The information follows:]

        GPO's cash balances in the revolving fund fluctuate every
    day and the amount the Agency has on-hand depends on a number
    of variables. Because GPO spends approximately $3 million every
    working day, a $30 million cash reserve would fund their
    operations for just 10 days, which in the past, has resulted in
    very low cash balances. GPO reported the following cash
    balances as of September 30 for the last three fiscal years:
    Fiscal year 1994, $64 million; fiscal year 1995, $36 million;
    and fiscal year 1996, $46 million.
        My testimony before the House Legislative Branch
    Appropriations Subcommittee wherein I spoke of the low level of
    financial reserves in the revolving fund, was made in reference
    to the funding of a study GPO was directed to conduct to
    determine if cost effective opportunities exist to privatize
    certain Congressional publications. My point was that GPO would
    have to fund the study out of its financial reserves even when
    they have been struggling for several years to achieve a break-
    even financial status in their operations. If GPO were required
    to spend an estimated $600,000 for a private consultant, it
    would result in an increase in their operating expenses and
    make it even more difficult to achieve a break-even status.

                Congressional printing and binding appropriation

        Senator Bennett. The House, as I understand, is irritated
    that excess money given by Congress for congressional printing
    and binding each year gets transferred to the revolving fund
    and then used to pay salaries, and overtime--now, the GPO
    clearly has the authority to do this, but the House believes
    that the money is used to offset the cost of executive branch
    funding.
        We have submitted questions to the GPO to flesh this out.
    Do you have any preliminary understanding about this, or any
    comment about it at this point?
        Senator Warner. I do not.
        Mr. Peterson. Mr. Chairman, the GPO cannot utilize any of
    the appropriations unless there is work against which the GPO
    can bill. There is a period of time in which the money sits in
    the revolving fund, and if it is not expended for printing
    ordered by the Congress it eventually is returned to the
    Treasury.
        I believe that the perception is a misperception.

                              JCP budget increase

        Senator Bennett. As I understand it, the increase you have
    asked for is entirely due to COLA's.
        Senator Warner. That is correct. It is civilian salaries.
        I might mention to the Chair it is this Senator's intention
    to explore the need for this committee altogether if we can do
    a proper job of title 44 reform. I am fortunate to have Mr.
    Peterson, with whom I have had a long professional association
    over many years in many different capacities, and he has
    devoted 5 days each week of his life to studying this issue,
    and he is an authority on it.
        Senator Bennett. If Congress were to abolish the Joint
    Committee, would we save the full $804,000?
        Senator Warner. Well, I would assume some added
    responsibilities might go to the Rules Committee, but I would
    hope the current budget of the Rules Committee could absorb
    that.
        Senator Bennett. Thank you very much.

                       prepared statement of senator ford

        Senator Warner. We thank the Chair very much for this
    opportunity, and forgive me for a raspy voice, and we have a
    statement here by the distinguished Senator from Kentucky, Mr.
    Ford, who is the ranking member of the Rules Committee, and I
    think it reflects the coordination with what I have said, and
    it is very short. Thank you.
        [The statement follows:]

                 Prepared Statement of Senator Wendell H. Ford

        Mr. Chairman and Members of the Subcommittee, thank you for
    the opportunity to make my position known.
        I support the $804,000 request of Chairman John Warner to
    operate the Joint Committee on Printing for fiscal year 1998.
    As a former Chairman of this Committee I believe the funding is
    minimal to carry out the statutory requirements assigned to
    this group.
        Chairman Warner tells us he intends to vigorously enforce
    Title 44 as long as it remains the law of the land. In my two
    terms as Chairman, JCP pursued that course. The savings were
    remarkable. We were able to show cost avoidance and expense
    containment throughout the government worth well over $50
    million in each of my four years. With the Committee's
    attention diverted over the past two years, I am sure Chairman
    Warner will now find savings a plenty in the Executive Branch.
        Our purpose was never to disrupt the process of government
    information distribution, but to the contrary, make it even
    more widely available to all segments of the population without
    financial discrimination. Chairman Warner is charting a similar
    course. I urge you to give him the funds he needs to succeed.

        Senator Bennett. We thank you, Mr. Chairman, for being
    here. If we have further questions, we will submit them to you
    and make them a part of the record, and, of course, Senator
    Ford's statement will be a part of the record.
        Senator Warner. I thank the Chair for conducting the
    hearing in his usual dignity and so forth. Thank you, Bob, very
    much.
                            JOINT ECONOMIC COMMITTEE

    STATEMENT OF HON. JIM SAXTON, CHAIRMAN
    ACCOMPANIED BY CHRISTOPHER FRENZE, EXECUTIVE DIRECTOR

                               opening statement

        Senator Bennett. We will now hear from the Joint Economic
    Committee. I know that is a sterling group, because I have the
    privilege of sitting on it. We appreciate Chairman Saxton's
    being here to defend the request for fiscal 1998.
        Mr. Chairman, we will go directly to your testimony.
        Mr. Saxton. Thank you very much, Mr. Chairman. I appreciate
    being here this morning. This is my first opportunity to appear
    as the chairman of the Joint Economic Committee. Last year, as
    you know, Senator Mack was the chairman and I was the vice
    chairman.
        Senator Bennett. Senator Mack last year was chairman of
    this subcommittee, too, so we are both sitting in for Senator
    Mack. [Laughter.]
        Mr. Saxton. This is an exciting 2 years for me as chairman
    and, as you know, this chairmanship goes back and forth, and
    that is why Senator Mack was chairman last year, and next
    Congress it will move back to the Senate.
        We have tried to identify an aggressive, assertive agenda
    for our research projects for the current term. We have decided
    that we wanted to concentrate on monetary policy, tax policy,
    spending policy, and regulatory policy, and there are some
    other things that from time to time we venture into, but those
    are the four main areas.
        During the first several months of this year we have moved
    quickly to produce a series of what I believe are timely and
    high quality studies and reports on these issues along, as I
    said, with a couple of other things.
        In February, for example, the Joint Economic Committee
    released reports on international monetary policy, the
    administration's education tax credit proposal, taxes and long-
    term economic growth, and the findings of the Advisory Council
    on Social Security.
        Then in March we released reports on the structure of the
    Federal Reserve System and the welfare-to-work tax credit
    proposal, and we followed that in April with reports on the
    roots of the current economic expansion, which is quite an
    interesting report, incidentally, the benefits of auto choice
    insurance reform, which is one of the areas that we ventured
    off into because it is of quite high interest to the citizens
    of the country who pay higher auto insurance premiums, the
    efficiency of targeted tax policies such as those the President
    has recommended, which is the education tax credit initiative,
    and establishing also Federal Reserve inflation goals, an
    extremely interesting subject on which we have spent a good
    deal of time.
        As you may know, Mr. Chairman, from the Joint Economic
    Committee hearings that you attended, our country has a
    practice of targeting a number of economic goals through the
    Fed, and other modern-day countries have chosen to target just
    price stability, or inflation, and so the studies address that
    issue.
        Then, in addition to the monthly hearings on employment
    conditions and the Consumer Price Index the Joint Economic
    Committee has also held hearings on the ``Economic Report of
    the President,'' the President's budget submission, and the
    economic impact of the tax system.
        Federal Reserve Chairman Greenspan's appearance before the
    Joint Economic Committee in March was widely viewed as
    telegraphing an imminent change in Federal Reserve policy just
    prior to the short-term interest rate increase.
        So I appreciate the opportunity to be here this morning to
    let you know that we have been extremely active and productive,
    and I guess I would say an informative player in the budget
    process which is currently unfolding.

                               prepared statement

        We appreciate you taking your time to take our testimony
    this morning, and we hope that inasmuch as we voluntary took a
    25-percent reduction in our budget the year before last and
    held it steady without any increase last year, this request is
    also without an increase.
        I am sorry, actually we took a $250,000 cut for fiscal 1997
    as well.
        [The statement follows:]

                       Prepared Statement of James Saxton

        Mr. Chairman and Members of the Subcommittee, it is a
    pleasure to present my strong support for the fiscal year 1998
    appropriation of the Joint Economic Committee (JEC). As the new
    Chairman of the JEC, I anticipate a productive two years of
    hearings, studies and reports on the important economic
    challenges facing our country.
        It is my view that the Congress must have the analytical
    capability to provide information to its Members before
    important policy decisions are made. The Executive Branch has a
    number of agencies with economic and statistical expertise, and
    Congress urgently needs to have access to as much similar
    information as possible through entities such as the JEC.
    Congressional decision-makers would be at a significant
    disadvantage without the analytical resources made available by
    the JEC.
        The JEC has moved quickly in this Congress to produce a
    series of timely and high-quality studies and reports on a wide
    variety of issues. In February the JEC released reports on
    international monetary policy, the Administration's education
    tax credit proposal, taxes and long-term economic growth, and
    the findings of the Advisory Council on Social Security. In
    March, the JEC released reports on the structure of the Federal
    Reserve System and the welfare to work tax credit proposal. In
    April, the JEC released reports on the roots of the current
    economic expansion, the benefits of auto-choice insurance
    reform, the efficiency of targeted tax policies, and
    establishing Federal Reserve inflation goals. In the first week
    of May, we have released a report on budget process reform. We
    are pleased with the favorable reception our research products
    have received by policy analysts and the media.
        In addition to the monthly hearings on employment
    conditions and the Consumer Price Index, the JEC has also held
    hearings on the Economic Report of the President, the
    President's budget submission, and the economic impact of the
    tax system. Federal Reserve Chairman Greenspan's appearance
    before the JEC in March was widely viewed as telegraphing an
    imminent change in Federal Reserve policy.
        In this Congress we will continue ongoing research programs
    in areas such as employment conditions, dynamic scoring of tax
    legislation, optimal size of government, middle class income
    trends, income mobility, and a variety of other topics. Our
    research agenda in the new Congress will expand in some of
    these areas, but has already branched out into some new areas
    as well.
        One area of particular interest arises from the drift in
    much of recent tax policy. At least to some extent, tax policy
    increasingly is driven by non-economic criteria, which despite
    the best of intentions, would gradually distort the tax system
    and undermine the economy. We have planned a series of studies
    and hearings to examine the economics of taxation, and the
    effects of the current tax code on work, saving, investment,
    and economic growth. These JEC activities will examine the need
    to reestablish the economic criteria on which sound tax policy
    should be based.
        Another issue on our research agenda concerns an
    examination of monetary policy, both in the United States and
    in several other nations. In recent years a number of national
    central banks, including our own Federal Reserve, have adopted
    price stability as their overriding objective. Several of these
    foreign central banks have targeted changes in price indexes as
    their main guide to conducting monetary policy. Our JEC
    research will be examining whether it would be desirable for
    the Federal Reserve to move in a similar direction.
        The JEC has been extremely active in this Congress and will
    continue to be active into the future. We will continue to
    expand our research agenda into new areas in coming months.
    Thank you for the opportunity to testify this morning.

        Senator Bennett. I am aware of that. Was your ability to
    absorb that reduction based on the use of technology and
    contracting out, or did you simply cut back and cut back
    activities?
        Mr. Saxton. I do not think we have cut back activities.
    Frankly, when we decided how we were going to reorganize
    ourselves we looked at the budget that we had and I believe we
    were able to attract some very high quality economists who are
    currently on the staff and who have worked overtime to produce
    the kind of product that we have been able to share with other
    Members of Congress and the public.
        It took some doing. I do not want to make light of it, but
    because of the quality of the people that we have and our
    ability to deal with these issues efficiently we have been able
    to continue a very high quality product.
        Senator Bennett. What is the status of the Boskin report on
    the Consumer Price Index in terms of the JEC report?
        Mr. Saxton. The Joint Economic Committee looked at the
    Boskin report, which recommended a 1.1-percent reduction in the
    Consumer Price Index presumably through some kind of a
    legislative action. We frankly related it to other policy
    issues that are addressed along with it, and we produced some
    reports which essentially said that everyone wants accurate
    numbers in dealing with economic analysis and measure of price
    stability in particular.
        But we also recognize that there are major changes which
    occur when you deal with the Consumer Price Index from a
    legislative point of view, particularly in the area of
    entitlements, and in the area of levels of taxation that we
    impose on the American people, because a change, as you know,
    in the Consumer Price Index has a direct impact on all those
    issues.
        We have also, therefore, asked the Bureau of Labor
    Statistics to report to us by the end of this summer on changes
    they might make in the computations that they make in order to
    arrive at a more accurate figure, so that rather than have
    Congress in the business of making some arbitrary judgment on
    where the Consumer Price Index ought to be pursuant to Boskin
    or pursuant to our own analysis, that the people that we hire
    and pay to do that, who are quite frankly pretty good at it,
    ought to be the group who proceed to make it more accurate.
        I would also like to point out on this issue that during
    the last couple of weeks the Bureau of Labor Statistics was
    called upon by the administration and I think by some Members
    of Congress to make suggestions as to what we might do in this
    budget to correct the inefficiencies or the deficiencies of the
    CPI.
        The leadership on the House side at least has decided not
    to make those legislative changes at this time, and so the
    Boskin Commission certainly kicked off a hot debate that had to
    do with Social Security and taxes and the Bureau of Labor
    Statistics, and I hope that we have gotten everyone's attention
    and that we will be moving toward more accurate numbers.
        Senator Bennett. We have been joined by Senator Dorgan, who
    is taking up his duties as the ranking member of this
    subcommittee, and Senator, we appreciate your being here, and
    welcome you to the subcommittee as well as to the ranking
    member's slot.
        Senator Dorgan. Thank you, Mr. Chairman.
        Senator Bennett. We will be pleased to have any opening
    statement you might have.
        Senator Dorgan. Mr. Chairman, first, it is not my usual
    practice to be tardy or late. I am in the middle of working on
    the flooding disaster issue, and we have some officials from
    North Dakota in, and we only have until 2:30 to file
    amendments, so I have been in a series of meetings on that.
    That has delayed me, and it will also require me to leave
    early, but I appreciate very much your convening the hearing
    and look forward to working with you on it.
        I served on the Joint Economic Committee and enjoyed it a
    great deal, and know of its work and appreciate, Congressman
    Saxton, your appearance.
        Mr. Saxton. Thank you.
        Senator Bennett. I would like to make a few general
    comments about the subcommittee, and I saved these until
    Senator Dorgan was here so he could contradict, comment, or
    otherwise remark.
        I think we need to be very careful in this subcommittee to
    recognize our responsibility to meet the needs of the entire
    legislative branch of the Government, not only the Senate and
    the House, but all of the other agencies that are part of the
    legislative branch, including the Library of Congress, the
    General Accounting Office, and others.
        The 103d and 104th Congresses have achieved significant
    reductions in both appropriations and numbers of staff in the
    legislative branch. In 1993, Congress eliminated 16
    subcommittees and abolished some select committees in an effort
    to reduce the budget and streamline the institution.
        In 1996, as a result of the work of those two Congresses
    and this subcommittee, both Senate and House committee staffs
    stand at roughly two-thirds of the level they were at in 1979,
    and when measured in 1979 constant dollars, legislative branch
    appropriations for fiscal 1997 are 19.8 percent less than they
    were in fiscal 1977, so we have achieved reductions in people,
    and we have achieved reductions in constant dollars.
        The reason I say that is that there are those who say we
    must now have a freeze in the legislative branch as if nothing
    had been done over the last 10, 15 years. The legislative
    branch appropriations were swollen. They were obviously too
    high.
        There was a change in control, at least in the Senate, in
    the 1980 election, and control went back to the Democratic
    Party after 6 years of Republican control, but through the 20-
    year period from 1977 to 1997 we have had the reductions that I
    have referred to, so I think the time has come in the name of
    good management to review how those reductions have taken
    place, and yes, we should look for additional savings, but we
    should recognize that a lot of work has been done, and we are
    not starting out from ground zero, and it may well be that a
    freeze is not the thing to do in terms of the overall
    appropriations for the legislative branch.
        Now, that having been said, I want to thank you, Mr.
    Chairman, for the fact that your committee is not asking for an
    increase and could live with the freeze, but I did want to make
    the general statement that in the legislative branch overall,
    this being our first hearing, we may not be able to sustain an
    overall freeze.
        Senator Dorgan, did you have any comment on that overall
    opening, which I delayed, as I say, until you could be here to
    respond?
        Senator Dorgan. Well, Mr. Chairman, I appreciate your
    comments. I think most people do not know that we have
    downsized, and as you state, we have reduced appropriations for
    the legislative branch and for committees, and it is
    interesting that this weekend there appears to have been a deal
    struck on a balanced budget agreement. I think we need to
    understand that and what all of that means in terms of our
    responsibilities, what kind of aggregate public spending we
    will have, and what our obligation is on oversight.
        I think that clearly with all of the Federal budget being
    under the microscope, so, too, is the budget of the legislative
    branch activities. Yet what we do is very important, and we
    need to make sure there is adequate funding for oversight to
    carry out the responsibilities of the legislative branch.
        I cannot think of a better Member to serve with than
    Senator Bennett. I think this will be an interesting
    subcommittee, and we will face some interesting decisions, at
    least if I am reading some of the Hill journals correctly.
        There are people who have a very active interest in the
    work of the legislative branch appropriations, but we just need
    to do our work thoughtfully and in a cooperative way, and I
    appreciate very much your comments.
        Senator Bennett. Thank you.
        Mr. Chairman, do you have anything further? Your request is
    easy.
        Mr. Saxton. We appreciate the time you have spent with us
    here this morning and we look forward to being funded at the
    appropriate level, and thank you for your time.
        Senator Bennett. If we have additional questions, we will
    submit them, and we will keep the record open for your
    responses. Thank you for being here.
        Mr. Saxton. Thank you.
        Senator Bennett. The next witness has been delayed, and the
    committee will take a recess until they arrive.
        [A brief recess was taken.]

                          JOINT COMMITTEE ON TAXATION

    STATEMENT OF HON. BILL ARCHER, CHAIRMAN
    ACCOMPANIED BY:
            KENNETH J. KIES, CHIEF OF STAFF
            BERNARD A. SCHMITT, DEPUTY CHIEF OF STAFF, REVENUE ANALYSIS
            MARY M. SCHMITT, DEPUTY CHIEF OF STAFF, LAW

                                 Budget request

        Senator Bennett. The subcommittee will reconvene. We
    appreciate the attendance of Chairman Archer of the Joint
    Committee on Taxation. This is a bipartisan and nonpartisan
    committee, so there is no division of budget between majority
    and minority salaries, as is the case in some other joint
    committees we have talked about, and for fiscal 1998 the Joint
    Committee has requested an appropriation of $6.126 million, an
    increase of 12 percent, or $656,000 over the fiscal 1997 level.
        This increase includes, I understand, $375,000 for new
    hires. That would be two to three new macroeconomists, $154,000
    for COLA's, and $120,000 for merit increases.
        Before you came, Mr. Chairman, I made a general statement
    that the appropriations for the legislative branch in constant
    dollars are substantially less than they were 20 years ago. The
    number of staff positions for the legislative branch are down
    significantly, the work primarily of the 104th Congress.
        I sat on this subcommittee when Connie Mack was the
    chairman and we took some rather substantial whacks out of a
    number of areas, including a 25-percent reduction in the
    Government Accounting Office, so I am not as convinced that we
    need an absolute freeze in the legislative branch
    appropriations as apparently some of your colleagues in the
    House are.
        So, you may find your testimony here to be a little more
    friendly than it might be on the House side in terms of the
    attitude of the Senate with respect to the legislative branch
    overall, but I would be happy to hear your testimony now, and
    then we can respond to some of the specifics.
        Mr. Archer. Thank you, Mr. Chairman.

                               opening statement

        I would not give way to anybody in the entire Congress in
    my desire to be frugal and to get 1 dollars' worth of benefit
    out of every dollar that we spend on the legislative branch.
    That was evidenced by the day after I became chairman of the
    Ways and Means Committee when I cut the majority staff by 40
    percent, which was probably the single biggest percentage cut
    of any committee in the entire Congress, House or Senate, and
    we have done our work effectively. But, I have watched over the
    years as the majority staff of the Ways and Means Committee
    ballooned up for political reasons.
        I come here today, as you know, to testify on behalf of the
    budget request for the Joint Committee on Taxation, which is
    not a political entity and which has not ballooned up over the
    years as the majority staff of the Ways and Means Committee
    ballooned up. Therefore, it did not take the cuts in the last
    Congress.
        I also believe that the massive cuts--and I also believe
    that their request for this year is justifiable, because they
    provide unique and essential services to both the House and the
    Senate at every stage of the tax legislative process, and they
    have to develop markup and draft tax bills, and they have to
    write all the tax committees' reports and the conference
    reports.
        In addition, they devote substantial, and I would say even
    more than substantial, resources to the preparation of revenue
    estimates. They have to accommodate every Member of Congress
    when they make a request for changes in the Tax Code. They
    provide the distributional analyses and other economic analyses
    that relate to tax legislation. I am sure you know that, but I
    just wanted to restate that for the record.
        In addition, what many people do not know is that they
    operate a refund office where they have to go over refunds that
    are large in numbers--that is, large in dollar numbers--that
    are suggested by the IRS before the IRS can actually make the
    refund of a certain threshold, and they have many times caught
    the IRS in errors and saved the taxpayers significant money.
        Senator Bennett. May I ask, what is that threshold?
        Mr. Kies. $1 million.
        Mr. Archer. I think you stated a little bit about what the
    request is, that for 1998 the request is $6,126,000. It is a
    net increase of $656,000 over the fiscal year 1997
    appropriation, but only $107,000 more than the fiscal year 1995
    appropriation for the Joint Committee, and I think you alluded
    to that.
        In the last Congress we asked the Joint Committee to assume
    additional responsibilities in addition to the traditional role
    of developing, drafting, and estimating of proposed revenue
    legislation. The Joint Committee now must determine the
    possible unfunded mandates contained in revenue legislation,
    which we voted for and which we put into effect. There has to
    be some entity to determine whether a particular proposal is an
    unfunded mandate or not, and beginning in 1997, to identify the
    limited tax benefits that are subject to the line item veto
    authority. The line item veto law provides that the Joint
    Committee will determine what items in the Tax Code are subject
    to a line item veto when the bill goes through the Congress.
        If the Joint Committee's responsibilities are expanded in
    any further way, for example by expanding the estimating
    services required as they begin to move toward--as they begin
    to move away from static analysis and more to an update for
    accuracy that will truly measure the revenue impact of tax
    legislation, then the Joint Committee is going to be needing
    additional resources. They are now beginning to start that, and
    some of the resources that are requested in this year's budget
    request are for that purpose.

                               prepared statement

        I guess that is pretty much what I need to tell you, Mr.
    Chairman, and maybe Ken Kies, who is the chief of staff of the
    Joint Committee on Taxation, would like to add something to it.
        [The statement follows:]
                       Prepared Statement of Bill Archer
                                  introduction
        Mr. Chairman, I appreciate the opportunity to appear before the
    Subcommittee today to discuss the fiscal year 1998 appropriation
    request for the Joint Committee on Taxation (the ``Joint Committee'').
        The Joint Committee staff provides unique and essential services to
    both the House of Representatives and the Senate at every stage of the
    tax legislative process. The Joint Committee staff is comprised of
    highly qualified lawyers, accountants, and economists, and has earned a
    reputation for nonpartisan excellence with the tax-writing committees,
    the Congress, the general public, and the professional tax community.
    The Joint Committee staff is involved in the development, marking up,
    and drafting of tax bills and is responsible for writing all tax
    Committee Reports and Conference Reports. In addition, the Joint
    Committee staff devotes substantial resources to the preparation of
    revenue estimates, distributional analyses, and other economic analyses
    relating to proposed legislation. The refund office of the Joint
    Committee reviews large proposed tax refunds as part of the
    Congressional oversight of the executive branch. The services of the
    Joint Tax Committee are central to Congressional oversight of the
    Federal tax system and to the tax legislative process.
        The funding we are requesting for the Joint Committee on Taxation
    represents the minimum amount necessary to finance the operations of
    the Joint Committee for fiscal year 1998. The Joint Committee provides
    essential services to the Congress that are not duplicated by any other
    Congressional or Executive Branch office.
        Key points relating to the fiscal year 1998 appropriation request
    are as follows:
        We are requesting a fiscal year 1998 appropriation for the Joint
    Committee of $6,126,000. This amount is a net increase of $656,000 over
    the fiscal year 1997 appropriation, but only $107,000 more than the
    fiscal year 1995 appropriation for the Joint Committee.
        In the last Congress, we asked the Joint Committee staff to assume
    additional responsibilities. In addition to the traditional role of the
    Joint Committee staff in the development, drafting, and estimating of
    proposed revenue legislation, the Joint Committee staff is now
    responsible for determining the possible unfunded mandates contained in
    revenue legislation and identifying, beginning in 1997, the limited tax
    benefits subject to the Line Item Veto Act. The Line Item Veto Act has,
    as you know, been overturned by a District Court, and is scheduled for
    expedited review by the Supreme Court, so the extent of the Joint
    Committee's responsibilities under the Act is unclear at this time.
        If the Joint Committee's responsibilities are expanded in any
    further way, for example, by expanding the revenue estimating services
    required or significantly modifying the revenue estimating process, we
    will find it necessary to request an additional increase in the Joint
    Committee's appropriation to reflect the additional personnel and
    equipment expenses attributable to such increased responsibilities. In
    that regard, we want to point out to the Subcommittee that a new House
    rule, adopted for the 105th Congress, would require the Joint Committee
    to determine the macroeconomic effects of proposed revenue legislation
    under certain circumstances. The Joint Committee staff does not
    currently have the staff or computer capabilities to satisfy this
    requirement. In addition, the Joint Committee hosted, on January 17,
    1997, a symposium presenting the results of a year-long study into the
    feasibility of incorporating macroeconomic effects into Joint Committee
    revenue estimates. There has been further interest in pursuing this
    capability as a result of the symposium and, therefore, there may be
    the need for additional funding.
        Additional details relating to this appropriation request are
    provided below.
                   summary of fiscal year 1998 budget request
        The following summarizes the Joint Committee's budget request for
    fiscal year 1998:

    Personnel Funding.............................................$5,541,000
    Non-Personnel Funding:
        Travel....................................................    10,000
        Transportation of Things..................................     2,000
        Rent, Communications, Utilities...........................    88,000
        Other Services............................................    95,000
        Supplies and Materials....................................   130,000
        Equipment.................................................   260,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total fiscal year 1998 request.......................... 6,126,000

        The fiscal year 1995 appropriation for the Joint Committee on
    Taxation was $6,019,000. The House-passed legislative branch funding
    bill for fiscal year 1996 froze the Joint Committee appropriation at
    the fiscal year 1995 level ($6,019,000). The final version of this
    legislation reduced the Joint Committee's appropriation for fiscal year
    1996 by 15 percent to $5,116,000. This reduction was the result of a
    provision in the Senate bill, adopted in conference, which generally
    reduced appropriations of all Senate committees. This was adopted
    despite the fact that the Joint Committee has always been funded
    through the House of Representatives. This appropriation was lower than
    the Joint Committee's budget in each of the last 5 fiscal years. The
    fiscal year 1997 appropriation for the Joint Committee is $5,470,000, a
    6.9 percent increase over fiscal year 1996, but still well below the
    fiscal year 1995 funding level.
               details of fiscal year 1998 appropriation request
    Personnel Expenses
        We are requesting an appropriation for fiscal year 1998 for the
    Joint Committee that is $656,000 more than the fiscal year 1997
    appropriation, but only $107,000 more than the fiscal year 1995
    appropriation. Of this $656,000 requested increase, $649,000 relates to
    increases in personnel expenses.
        Cost of living.--As instructed by the House Finance Office, we are
    requesting $28,000 for the annualized fiscal year 1997 cost-of-living
    adjustment (2.3 percent) and $126,000 for a prorated fiscal year 1998
    cost-of-living adjustment (2.325 percent). These amounts are
    essentially determined for the Joint Committee by the House Finance
    Office because they provide to us both the compensation base and the
    percentage adjustments.
        Merit increases.--We are requesting an additional appropriation for
    fiscal year 1998 of $120,000 for merit increases for existing staff.
        This request does not include any specific requested amount for
    possible overtime pay. During 1996, the Joint Committee staff spent
    considerable time and effort developing procedures to comply with the
    requirements of the Congressional Accountability Act. One staff
    attorney worked essentially full time to develop a staff personnel
    manual that details all of the Joint Committee staff rules and
    procedures. In addition, she made determinations as to which employees
    are subject to the overtime requirements and created written job
    descriptions for each job category. This attorney also spent many hours
    developing support staff performance evaluation forms and procedures.
    We have developed flexible staff scheduling procedures for support
    staff that will minimize, but not eliminate, the need to pay overtime.
    However, we will be required to devote considerable administrative
    staff time each year to complying with the Congressional Accountability
    Act on an ongoing basis. Thus, the requested increase assumes a modest
    amount for administrative staff support and minimal overtime payments
    to comply on an ongoing basis with the requirements of the
    Congressional Accountability Act.
        New hiring.--We are requesting $375,000 for hiring to fill FTE's we
    are requesting for the Joint Committee for fiscal year 1998. We expect
    the Joint Committee to fill these FTE positions with additional
    professional staff--primarily staff attorneys, accountants, and
    economists--and possibly one or two computer specialists and support
    staff.
        The Joint Committee staff does not now have sufficient numbers of
    staff attorneys and economists to satisfy the traditional duties of the
    Joint Committee. The staff needs to hire additional professional staff
    so that the service provided to the Congress in connection with the
    consideration of revenue legislation does not suffer.
        Furthermore, we believe that this request is eminently reasonable
    given the new responsibilities that were imposed on the Joint Committee
    staff by legislation enacted during the 104th Congress. For example,
    the Joint Committee staff has new responsibilities specifically
    mandated under the Line Item Veto Act and arising out of the enactment
    of the Unfunded Mandates Reform Act of 1995 and the review of
    regulations under the regulatory reform bill. The scope of the Joint
    Committee staff's new responsibility for any year will be determined by
    the amount of revenue legislation considered during the year. However,
    the Joint Committee staff estimates that any significant revenue
    legislation could require approximately \1/2\ full-time employee to
    satisfy these new requirements during 1997.
    Authorized positions
        We are requesting 73 FTE's for the Joint Committee for fiscal year
    1998. This number would return the Joint Committee to the authorized
    staffing level for fiscal year 1995. The Joint Committee has 61
    authorized staff positions for fiscal year 1997. Other than fiscal year
    1996, in which the authorized staff positions were 63, the authorized
    staff levels have not, since 1980, been below 66 positions. Thus, the
    authorized staffing levels of the Joint Committee are well below
    historical levels. Unless the authorized FTE's are increased to an
    acceptable level, we believe that the services the Joint Committee
    provides to the Congress will be compromised.
        We would expect that these additional FTE's would be filled
    primarily with professional staff members--attorneys, accountants, and
    economists; 1 or 2 positions might be filled with support staff to
    accommodate the needs of these new professional staff. We expect that
    particular emphasis would be placed on hiring additional staff
    economists to continue the Joint Committee's efforts to pursue the
    capability of incorporating macroeconomic effects in the Joint
    Committee's revenue estimates.
        We believe that the authorized staffing for the Joint Committee is
    unacceptably low. The Joint Committee staff will not be able to
    maintain its reputation for quality service to the Congress unless it
    is permitted to hire sufficient professional staff members. As a result
    of the new obligations of the Joint Committee discussed above, the
    amount of time that the Joint Committee staff is able to devote to the
    traditional duties analyzing revenue legislation has been diminished.
    Unless additional hiring is authorized, the service to the Congress
    will no doubt suffer.
        The current Joint Committee staff has shown remarkable dedication
    in picking up the slack as the Joint Committee is unable to fill the
    positions of departing staff members. However, at some point, these
    dedicated professionals, who often take positions on the Joint
    Committee staff at less than one-half the compensation they would make
    in the private sector, will conclude that the long hours for less-than-
    market pay poses too great a burden on their families. This, we
    believe, would be a great loss for the Congress.
        The extremely complex, technical, and specialized nature of the
    Joint Committee work requires the Joint Committee to hire and retain a
    highly trained and experienced staff. The Joint Committee professional
    staff, comprised of certified public accountants, Ph.D. economists, and
    lawyers with private law practice or significant government experience,
    agree to work for the Joint Committee at salaries substantially below
    those available in the private sector. The lawyers on the Joint
    Committee staff are graduates of the leading law schools throughout the
    country, and most attained significant honors at law school. Several of
    them have advanced degrees in taxation. Each had substantial related
    experience before coming to work for the Joint Committee, either in
    private practice with major, well-respected law firms, or with the
    Internal Revenue Service or other government agencies that deal with
    Federal tax matters. The accountants on the staff each spent at least 3
    years in private practice with ``Big Six'' accounting firms. The staff
    economists all have advanced degrees. Several have university faculty
    experience. In addition, many of the economists have substantial
    experience with economic modeling, both in the government and with a
    variety of organizations in the private sector.
        Despite the competition in the marketplace for tax expertise at the
    level required by the Joint Committee, the Joint Committee has in the
    past generally been successful in retaining highly qualified staff
    members. The ability of the Joint Committee to hire sufficient numbers
    of qualified staff members to provide the current level of service to
    the Congress will be impaired if the requested appropriation is not
    approved. If the current appropriations request is approved, we expect
    that the Joint Committee will be able to fill open staff positions with
    qualified candidates so that the level of service provided to the
    Congress will not be compromised.
    Nonpersonnel expenses
        We are requesting only minimal increases in nonpersonnel expenses
    for fiscal year 1998. We have requested a $5,000 increase in the travel
    budget, which is used by the Joint Committee to send staff members to
    educational conferences and for travel in connection with hiring
    personnel, and the addition of a $2,000 appropriation for the
    transportation of things. These two amounts are the only increases we
    are requesting in nonpersonnel expenses.
        The amount budgeted for other services is primarily for consulting
    services. The needs of the Members for immediate responses to requests
    for revenue estimates and the substantial volume of requests for
    revenue estimates that the Joint Committee staff receives places
    tremendous burdens on the estimating staff. To perform efficiently, the
    staff of the Joint Committee has found it necessary to contract from
    time to time with certain private sector organizations to do work that
    the Joint Committee staff does not have the time or the resources to do
    otherwise. Also, as mentioned above, the Joint Committee staff has
    contracted with firms to help investigate issues involved in
    incorporating macroeconomic effects in revenue estimates.
        The purchase of equipment represents the single largest item of
    nonpersonnel expenses. The large volume of documents that the Joint
    Committee is required to produce during the legislative process
    requires that the Joint Committee staff have computer equipment
    necessary to produce documents quickly. In addition, the Joint
    Committee devotes significant resources to the preparation of revenue
    estimates, distribution analyses, and other economic analyses relating
    to proposed legislation. The nature of this work and the speed with
    which the staff is normally asked to complete its analyses requires
    that the Joint Committee on Taxation staff utilize the most
    sophisticated and technologically advanced equipment. Thus, the staff
    finds it necessary to upgrade computer software and hardware constantly
    to enable the staff to provide the service required and expected by the
    Members of Congress.
    Possible need for additional appropriation
        We believe that the fiscal year 1998 budget request represents the
    minimum appropriation necessary at this time to enable the Joint
    Committee to provide service to the Congress at current levels. In
    addition, we want to alert the Subcommittee to the fact that there are
    likely to be new responsibilities imposed by the Congress on the Joint
    Committee staff that may not be met out of the requested appropriation.
    These new responsibilities may create the need for additional funding
    for fiscal year 1998 and beyond.
        The House approved a new House rule for the 105th Congress that
    requires the staff of the Joint Committee to estimate the possible
    macroeconomic (or dynamic) scoring effects of major revenue
    legislation. The Joint Committee staff presently has neither the
    personnel nor the computer capabilities to satisfy the requirements of
    this rule. As discussed in more detail below, the staff of the Joint
    Committee undertook during 1996 a year-long study of the feasibility of
    incorporating macroeconomic effects in its revenue estimates. On
    January 17, 1997, the Joint Committee staff hosted a symposium, open to
    the public, analyzing the results of this year-long study. Based on the
    results presented at this symposium, there is further interest in
    pursuing the capability of calculating the macroeconomic effects of
    major revenue legislation and, therefore, there may be a need for
    additional funding to finance the development of this capability.
        We have asked the Joint Committee staff to estimate the number of
    additional personnel and nonpersonnel funding that might be necessary
    to work toward the development of macroeconomic estimating capability.
    They inform me that, during the developmental stages, which could take
    a couple of years, the Joint Committee would need up to 8 additional
    staff, composed of 2 senior economists, 4 economic analysts, and 2
    computer programmers with an annual salary expense of $600,000. In
    addition, it would be necessary to contract with 2 or 3 major
    macroeconomic modeling firms for various research and development
    expenses, at an estimated additional expense of approximately $100,000
    per year. After the developmental stage, the Joint Committee staff
    would have ongoing needs for approximately 6 professional staff
    economists and computer programmers, rather than 8.
        We believe that we must pursue the goal of providing a broader
    class of economic analysis for proposed tax legislation, particularly
    relating to the impact of saving and investment incentives and their
    effects on the economy. However, we recognize that pursuing this goal
    will require some extraordinarily sophisticated economic analysis that
    blends traditional macroeconomic theory with the complexities of the
    microeconomic analysis historically done in the preparation of revenue
    estimates. There is no organization or entity that currently has this
    capability. Thus, this effort will require the commitment of the
    Congress over a number of years if we can hope to be successful.
     review of joint committee on taxation operations during calendar year
                                      1996
        Attachments A through D provide a summary of the activity of the
    Joint Committee for calendar year 1996. During 1996, the Joint
    Committee staff drafted fourteen Committee and Conference Reports
    (Statements of Managers) for the House Ways and Means Committee and the
    Senate Finance Committee. In addition, the staff drafted three tax
    treaty Executive Reports for the Senate Foreign Relations Committee
    (see Attachment A).
        During 1996, the Congress considered and passed seven different
    pieces of tax legislation. The Joint Committee staff was involved in
    the development of this legislation on both a technical and policy
    level, and prepared numerous revenue estimates and distribution
    analyses of the final legislation, as well as numerous alternative
    proposals. The legislation includes provisions in the following areas:
    Medical savings accounts; earned income credit; small business
    provisions; health-related tax provisions; corporate and other tax
    reforms; expiring tax provisions; taxpayer Bill of Rights 2;
    simplification and technical corrections; special tax rules applicable
    to combat zones in Bosnia and Herzegovina, Croatia and Macedonia; and
    tax treatment of special assessments for the Savings Association
    Insurance Fund.
        The Joint Committee was involved in a variety of other tax
    initiatives considered by the Congress, including miscellaneous tax
    reforms, and analyses of various flat tax and consumption tax
    proposals, including proposals to adopt a national sales tax, in
    connection with Congress' continued consideration of fundamental tax
    reform. Because these proposals could result in a complete
    restructuring or replacement of the Federal income tax system, they
    involve significant legal and economic analysis, and present unique
    revenue estimating issues. The Joint Committee also was involved in
    work in connection with the President's budget submission and various
    alternative budget proposals. The Joint Committee staff prepared two
    hearing pamphlets for the Senate Committee on Foreign Relations in
    connection with proposed income tax treaties.
        In addition to its work on Committee and Conference Reports and tax
    treaties, the Joint Committee staff published 61 documents during 1996,
    including pamphlets and testimony prepared at the request of the
    Committee on Ways and Means and the Senate Finance Committee for
    hearings held by those committees and pamphlets prepared for the
    benefit of Members of Congress and their staffs in connection with tax
    issues of current interest (see Attachment B). Included in these other
    documents was the General Explanation of Tax Legislation Enacted in the
    104th Congress, a comprehensive compilation of the legislative history
    of all tax legislation enacted during the 104th Congress.
        Also included in 1996 publications were two pamphlets providing a
    description of present law, issue analysis and background information
    and data on Federal transportation excise taxes and Trust Fund
    expenditure programs. These documents were prepared in response to the
    request of the Committee on Ways and Means in connection with the
    appointment of a bipartisan task force of Members of that Committee to
    advise on transportation excise tax issues. We asked the Joint
    Committee staff to assist the task force on a continuing basis by
    developing information needed for the task force's work.
        In addition, among the documents published in 1996 was a draft
    analysis of issues and procedures for applying the Line Item Veto Act
    (relating to limited tax benefits). The Joint Committee solicited
    public comment to be submitted by December 13, 1996 on the Line Item
    Veto Act analysis, in preparation for implementation of this new
    provision in 1997.
        In 1996 the Joint Committee staff undertook a review of the recent
    developments in the tax rules governing entity classification and
    taxation of the income of partnerships, as well as issues relating to
    tax-free corporate spinoffs, responding to changes in State law and
    Treasury guidance that have significantly impacted these areas. The
    Joint Committee staff consulted academics, practitioners and bar groups
    in these areas and requested public comment by December 16, 1996.
        The Unfunded Mandates Reform Act of 1995 imposes certain procedural
    requirements in the House and Senate with respect to mandates imposed
    on either the private sector or on State and local governments. Under
    procedures developed in coordination with CBO, the Joint Committee
    staff is required to provide an estimate to the CBO of the direct costs
    of complying with any such mandates contained in revenue legislation
    considered by the Congress.
        During 1996, the Joint Committee received over 1,750 requests for
    revenue estimates (see Attachment C). The requests received in 1996
    frequently involved complex proposals relating to alternative tax
    structures and proposals under consideration as part of the Small
    Business Act, the welfare reform bill, and the health reform bill, all
    of which required significant time on the part of the Joint Committee's
    legal and economics staff.
        One of the statutorily mandated functions of the staff of the Joint
    Committee is the review of Internal Revenue Service refunds or credits
    of income tax, estate and gift tax, or any tax on public charities,
    foundations, pension plans, or real estate investment trusts in excess
    of $1,000,000. The Joint Committee staff reports on each such refund
    case and makes comments or recommendations with respect to the proposed
    refund case to the IRS. During 1996 (through November), the Joint
    Committee refund staff reviewed 486 proposed refunds. The Joint
    Committee staff raised concerns in 92 cases (or approximately 19
    percent of the cases). Errors identified by the Joint Committee staff
    produced a net reduction in refunds of $10,600,000 in 1996. A copy of
    the Joint Committee staff's 1996 Refund Review Operations Report (other
    than sections containing confidential taxpayer information) is included
    as Attachment D.
    summary of anticipated workload of the joint committee on taxation for
                               calendar year 1997
        During 1997, it is expected that the Congress will return to
    consideration of various flat tax and consumption tax proposals that
    have been or will be introduced. Some work was done on restructuring
    proposals in 1995 and 1996, and we expect that this work will be
    intensified in 1997, as new proposals are introduced and existing
    proposals are refined and modified. Because these proposals involve a
    complete restructuring or replacement of the current Federal tax
    system, the economic and legal analysis of such proposals can be
    extraordinarily complex, requiring substantial staff time. We expect
    that Congressional consideration of these initiatives will place
    critical and unique demands on the staff of the Joint Committee to
    provide revenue estimates and legal and economic analyses in connection
    with these proposals.
        In addition, we expect the Joint Committee staff to continue to
    have an integral role in tax aspects of Federal budget deliberations.
    It is anticipated that the Joint Committee will assist in development
    and analysis of legislative proposals, and prepare markup documents,
    Committee reports and conference reports (Statements of Managers) with
    respect to any tax pieces of Federal budget legislation.
        The Joint Committee devotes substantial resources to the
    preparation of revenue estimates, distribution analyses, and other
    economic analyses relating to proposed revenue legislation. During
    1996, Members of Congress were increasingly interested in the revenue
    estimation process, particularly the possibility of incorporating
    macroeconomic effects in revenue estimates, and we expect that this
    interest will continue in 1997. Determining whether this can be done
    and, if so, how to do it, will require substantial resources. Currently
    accepted estimation processes do not account for macroeconomic effects,
    and there is no consensus in the economic community about how, and
    whether to, account for such effects. The Joint Committee has already
    taken steps to improve the estimating process and determine the
    feasibility of incorporating macroeconomic effects. These steps include
    providing more disclosure regarding the estimation process to Members,
    determining whether proposals are likely to have significant
    macroeconomic effects, establishing a revenue estimating advisory board
    (which will, among other things, address macroeconomic issues), and
    contracting with macroeconomic forecasting firms for the purpose of
    studying the feasibility of developing estimating models that
    incorporate macroeconomic effects. The Joint Committee is in the
    process of planning a conference of economic advisors in January 1997
    in order to review the results of the macroeconomic forecasting firms.
    It is anticipated that this review will help determine the feasibility
    of using such forecasting models and aid in the development of models
    that may be used by the Joint Committee. The ability of the Joint
    Committee to continue these efforts will be impaired if funding at the
    requested level is not provided.
        During 1997, the requirements imposed under the Unfunded Mandates
    Reform Act of 1995 will give rise to a continuing responsibility of the
    Joint Committee staff to provide an estimate to the CBO of the direct
    costs of complying with mandates on the private sector or on State and
    local governments that are contained in revenue legislation considered
    by the Congress.
        Under the regulatory reform bill recently enacted, a process of
    Congressional disapproval applies to certain executive branch
    regulations, rulings, and other pronouncements. The Ways and Means
    Committee and the Senate Finance Committee have asked the Joint
    Committee to review all tax regulations and similar guidance submitted
    to the Congress under the regulatory reform legislation and to report
    to the Committees on any issues that might be appropriate for
    Congressional disapproval.
        The Line Item Veto Act imposes a statutory responsibility on the
    Joint Committee to identify limited tax benefits contained in any
    legislation considered by the House or the Senate and to prepare a
    statement for inclusion in every Statement of Managers to identify any
    limited tax benefit. Following up on its work during 1996 in
    preparation for this duty, the Joint Committee staff, in 1997, will
    commence implementation of these provisions as required under the Act.
    The Line Item Veto Act has, as you know, been overturned by a District
    Court, and is scheduled for expedited review by the Supreme Court, so
    the extent of the Joint Committee's responsibilities under the Act is
    unclear at this time.
        It is anticipated that the Ways and Means Committee's bipartisan
    task force on transportation excise tax issues will require additional
    background information, data and analysis during 1997. This will carry
    on the work commenced by the Joint Committee, in response to the task
    force's 1996 request for assistance on an ongoing basis.
        It is also anticipated that the Joint Committee will be engaged
    during 1997 in analysis of its review of the recent developments in the
    tax rules governing entity classification and taxation of the income of
    partnerships and issues relating to tax-free corporate spinoffs,
    responding to changes in State law and Treasury guidance that have
    significantly impacted these areas.
                                   conclusion
        We will continue to rely on the staff of the Joint Committee to
    provide us with their technical support. This superb staff has a
    demonstrated track record of service to the Congress. The appropriation
    request for fiscal year 1998 is intended merely to provide the
    necessary resources for the Joint Committee staff to respond promptly
    and adequately to the requests for assistance that it receives from the
    Members of Congress and to maintain its current level of services.
    Therefore, if the work required of the Joint Committee increases in any
    respect, for example, if the demand for revenue estimation services
    increases beyond the current level provided by the Joint Committee, or
    if the type of services demanded are expanded to include macroeconomic
    analyses, additional funding may be requested to enable the Joint
    Committee staff to satisfy this increased workload. For example,
    additional funds could be required to secure necessary computer models
    and data bases, to hire personnel with expertise regarding
    macroeconomic effects, and to ensure that the Joint Committee has the
    necessary computer software and hardware to complete economic analyses
    with the speed required by the Congress.
        In conclusion, we hope you appreciate the current role that the
    Joint Committee staff plays in the analysis and development of tax
    legislation. The nonpartisan technical tax experts on the Joint
    Committee staff provide an invaluable service to the Congress that
    cannot be provided by any other Congressional or Federal office. Their
    work for the Congress during 1996 proved this. A failure to provide the
    Joint Committee with its requested appropriation will hinder seriously
    the ability of the Joint Committee staff to respond to the requirements
    and needs of the Members of Congress.
                                     ______

     Attachment A.--1996 Tax-Related Legislative Reports Worked on by the
                    Staff of the Joint Committee on Taxation
                       tax committee report explanations
        H.R. 2337 (Taxpayer Bill of Rights 2). H. Rept. 104-506 (Ways and
    Means Committee report on bill to provide increased taxpayer
    protections).
        H.R. 2754 (Shipbuilding Trade Agreement Act). H. Rept. 104-524, Pt.
    1 (Ways and Means Committee report--portion on revenue offset
    provisions of Shipbuilding Trade Agreement Act).
        H.R. 2778 (Tax Benefits for Individuals Performing Services in
    Certain Hazardous Duty Areas). H. Rept. 104-465 (Ways and Means
    Committee report on bill to provide that members of the U.S. Armed
    Forces in Bosnia and Herzegovina are entitled to tax benefits as if in
    a combat zone).
        H.R. 3074 (Shipbuilding Agreement Act; Generalized System of
    Preferences Program). S. Rept. 104-270 (Finance Committee Report--
    revenue offset provisions).
        H.R. 3103 (Health Insurance Portability and Accountability Act of
    1996). H. Rept. 104-496, Pt. I (Ways and Means Committee report--
    revenue provisions of bill on health insurance coverage, medical
    savings accounts, long-term care services and revenue offsets).
        H.R. 3103 (Health Insurance Portability and Accountability Act of
    1996). H. Rept. 104-736 (Conference report on revenue provisions of the
    Act).
        H.R. 3286 (Adoption Promotion and Stability Act). H. Rept. 104-542,
    Pt. II (Ways and Means Committee report on bill to offset costs of
    adoptions).
        H.R. 3286 (Adoption Promotion and Stability Act). S. Rept. 104-279
    (Finance Committee report on adoption bill).
        H.R. 3415 (Temporary Repeal of 4.3-Cents-Per-Gallon Transportation
    Fuels Excise Tax). H. Rept. 104-576, Pt. 1 (Ways and Means Committee
    report on bill to provide a temporary repeal of 4.3-cents-per-gallon
    transportation motor fuels excise tax).
        H.R. 3448 (Small Business Job Protection Act of 1996). H. Rept.
    104-586 (Ways and Means Committee report on bill to provide tax relief
    for small businesses and other revenue provisions).
        H.R. 3448 (Small Business Job Protection Act of 1996). S. Rept.
    104-281 (Finance Committee report on bill to provide tax relief for
    small businesses and other revenue provisions).
        H.R. 3448 (Small Business Job Protection Act of 1996). H. Rept.
    104-737 (Conference report on bill to provide tax relief for small
    businesses and other revenue provisions).
        H.R. 3734 (Personal Responsibility and Work Opportunity Act of
    1996). H. Rept. 104-651 (House Budget Committee report--revenue
    provisions relating to the earned income tax credit).
        H.R. 3734 (Personal Responsibility and Work Opportunity Act of
    1996). H. Rept. 104-725 (Conference report--revenue provisions relating
    to the earned income tax credit).
                          tax treaty executive reports
        Income Tax Convention With Kazakhstan. Exec. Rept. 104-34
    (Executive report for Senate Foreign Relations Committee).
        Protocol Amending Article VIII of the 1948 Tax Convention With
    Respect to the Netherlands Antilles. Exec. Rept. 104-35 (Executive
    report for Senate Foreign Relations Committee).
        Taxation Protocol Amending Convention with Indonesia. Exec. Rept.
    104-36 (Executive report for Senate Foreign Relations Committee).
                                     ______

                   Attachment B.--Joint Committee on Taxation
                                jcs-96 documents
        JCS-1-96--Selected Materials Relating To The Federal Tax System
    Under Present Law And Various Alternative Tax Systems. March 14, 1996
        JCS-2-96--Description Of Revenue Provisions Contained In The
    President's Fiscal Year 1997 Budget Proposal (Released On March 19,
    1996). March 27, 1996
        JCS-3-96--Impact On Small Business Of Replacing The Federal Income
    Tax. Scheduled for a Hearing Before the House Committee on Ways and
    Means on April 24, 1996. April 23, 1996
        JCS-4-96--Impact On State And Local Governments And Tax-Exempt
    Organizations Of Replacing The Federal Income Tax. Scheduled for a
    Hearing Before the House Committee on Ways and Means on May 1, 1996.
    April 30, 1996
        JCS-5-96--Impact On International Competitiveness Of Replacing The
    Federal Income Tax. Scheduled for a Hearing Before the House Committee
    on Ways and Means on July 18, 1996. July 17, 1996
        JCS-6-96--Comparison Of Revenue Provisions Of H.R. 3448 (Small
    Business Job Protection Act Of 1996) As Passed By The House And The
    Senate. Prepared for the Use of the House and Senate Conferees. July
    31, 1996
        JCS-7-96--Impact On Manufacturing, Energy, And Natural Resources Of
    Replacing The Federal Income Tax. Scheduled for a Hearing Before the
    House Committee on Ways and Means on July 31, 1996. July 31, 1996
        JCS-8-96--Explanation Of Proposed Protocol To The Income Tax Treaty
    Between The United States And Indonesia to be Considered by the
    Committee on Foreign Relations United States Senate. September 16, 1996
        JCS-9-96--Explanation Of Proposed Protocol To The Income Tax Treaty
    Between The United States And The Kingdom Of The Netherlands In Respect
    Of The Netherlands Antilles to be Considered by the Committee on
    Foreign Relations United States Senate. September 16, 1996
        JCS-10-96--Present Law And Background Information On Federal
    Transportation Excise Taxes And Trust Fund Expenditure Programs.
    Prepared for the Use of the House Committee on Ways and Means. November
    14, 1996
        JCS-11-96--Estimates Of Federal Tax Expenditures For Fiscal Years
    1997-2001. November 26, 1996
        JCS-12-96--General Explanation Of Tax Legislation Enacted In The
    104th Congress.
                                jcx-96 documents
        JCX-1-96--Description Of Tax Provisions Included In A Plan To
    Achieve A Balanced Budget Submitted To The Congress By The President On
    January 6, 1996. January 24, 1996
        JCX-2-96--Description Of Present Law, H.R. 2778, And An Amendment
    In The Nature Of A Substitute Relating To Tax Relief For Peacekeeping
    Personnel In The Former Yugoslavia. Scheduled for Markup by the House
    Committee on Ways and Means on February 28, 1996. February 27, 1996
        JCX-3-96--Estimated Revenue Effects Of H.R. 2778 As Reported By The
    Committee On Ways And Means. February 29, 1996
        JCX-4-96--Description Of Revenue Provisions Of The ``Health Care
    Availability And Affordability Act Of 1996'' to be Introduced on
    Monday, March 18, 1996 and Scheduled for Markup by the House Committee
    on Ways and Means on March 19, 1996. March 15, 1996
        JCX-5-96--Amendment In The Nature Of A Substitute To H.R. 3103 To
    Be Offered By Chairman Archer On Tuesday, March 19, 1996. March 18,
    1996
        JCX-6-96--Estimated Budget Effects Of Items Contained In An
    Amendment In The Nature Of A Substitute To H.R. 3103 To Be Offered By
    Chairman Archer On Tuesday, March 19, 1996. March 18, 1996
        JCX-7-96--Description Of Amendment In The Nature Of A Substitute To
    H.R. 2337 ``Taxpayer Bill Of Rights 2''. Scheduled for Markup by the
    House Committee on Ways and Means on March 21, 1996. March 20, 1996
        JCX-8-96--Estimated Revenue Effects Of The Taxpayer Bill Of Rights
    2. Scheduled For Ways And Means Markup On Thursday, March 21, 1996.
    March 20, 1996
        JCX-9-96--Description Of Revenue Provisions Relating To Shipping
    Income. To Be Offered in the Amendment in the Nature of a Substitute to
    H.R. 2754, the ``Shipbuilding Trade Agreement Act,'' Scheduled for
    Markup by the Committee on Ways and Means on March 21, 1996. March 20,
    1996
        JCX-10-96--Estimated Revenue Effects Of An Amendment In The Nature
    Of A Substitute For H.R. 2754, The ``Shipbuilding Trade Agreement Act''
    Scheduled For Ways And Means Markup On Thursday, March 21, 1996. March
    20, 1996
        JCX-11-96--Description Of Revenue Provisions Of Amendment To S.
    1028 By Senators Dole And Roth. April 18, 1996
        JCX-12-96--Estimated Revenue Effects Of A Possible Amendment To S.
    1028 By Senators Dole And Roth. April 18, 1996
        JCX-13-96--Estimated Budget Effects Of The Revenue Provisions
    Contained In H.R. 3286, The ``Adoption Promotion And Stability Act Of
    1996''. April 26, 1996
        JCX-14-96--Description Of Revenue Provisions Of H.R. 3286 Relating
    To Tax Credit For Adoption Expenses And Certain Revenue Offsets
    Scheduled for Markup Before the House Committee on Ways and Means on
    May 1, 1996. April 26, 1996
        JCX-15-96--Description Of Revenue Provisions To Be Considered In
    Connection With A Markup Of Trade Matters. Scheduled for Markup by the
    Senate Committee on Finance on May 8, 1996. May 1, 1996
        JCX-16-96--Estimated Budget Effects Of Tax And Trade Provisions To
    Be Considered At A Markup Of The Senate Finance Committee On May 8,
    1996. May 1, 1996
        JCX-17-96--Present Law And Background Relating To Federal Excise
    Taxes Imposed On Transportation Motor Fuels. Scheduled for a Hearing
    Before the Senate Committee on Finance on May 3, 1996. May 2, 1996
        JCX-18-96--Present Law And Background Relating To Federal Excise
    Taxes Imposed On Transportation Motor Fuels. Scheduled for a Hearing
    Before the Committee on Ways and Means on May 8, 1996. May 7, 1996
        JCX-19-96--Temporary Repeal Of 4.3-Cents-Per-Gallon General Fund
    Transportation Motor Fuels Excise Tax. Scheduled for Markup by the
    Committee on Ways and Means on May 9, 1996. May 8, 1996
        JCX-20-96--Estimated Revenue Effects Of H.R. 3415. Scheduled for
    Markup by the Committee on Ways and Means on May 9, 1996. May 9, 1996
        JCX-21-96--Description Of Chairman's Mark Of The Small Business Job
    Protection Act. Scheduled for Markup by the House Committee on Ways and
    Means on May 14, 1996. May 13, 1996
        JCX-22-96--Estimated Revenue Effects Of The ``Small Business Job
    Protection Act Of 1996,'' A Bill To Be Introduced And Subject Of A
    Markup By The Committee On Ways And Means On Tuesday, May 14, 1996. May
    14, 1996
        JCX-23-96--Present Law And Issues Relating To Classification Of
    Workers As Employees Or Independent Contractors. Scheduled for a
    Hearing Before the Subcommittee on Oversight of the House Committee on
    Ways and Means on June 4, 1996. June 3, 1996
        JCX-24-96--Description Of Chairman's Mark For The Provisions Of
    H.R. 3286 Relating To Tax Credit For Adoption Expenses And Certain
    Revenue Offsets And The Removal Of Barriers To Interethnic Adoptions.
    Scheduled for Markup Before the Senate Committee on Finance on June 12,
    1996. June 11, 1996
        JCX-25-96--Estimated Budget Effects Of Chairman's Mark To The
    Revenue Provisions Of H.R. 3286, The ``Adoption Promotion And Stability
    Act Of 1996,'' Scheduled for Finance Committee Markup on June 12, 1996.
    June 11, 1996
        JCX-26-96--Description Of Chairman's Mark Of A Committee Amendment
    To The Revenue Provisions Of H.R. 3448 (Small Business Job Protection
    Act Of 1996). Scheduled for Markup by the Senate Committee on Finance
    on June 12, 1996. June 11, 1996
        JCX-27-96--Estimated Budget Effects Of Chairman's Mark Of A
    Committee Amendment To The Revenue Provisions Of H.R. 3448, The ``Small
    Business Job Protection Act Of 1996,'' Scheduled for Finance Committee
    Markup on June 12, 1996. June 11, 1996
        JCX-28-96--Description Of Earned Income Credit Provisions Contained
    In An Amendment In The Nature Of A Substitute To Be Offered By Chairman
    Archer. Scheduled for Markup by the House Committee on Ways and Means
    on June 12, 1996. June 11, 1996
        JCX-29-96--Estimated Revenue Effects Of Earned Income Credit
    Provisions Contained In An Amendment In The Form Of A Substitute By
    Chairman Archer With Respect To The Budget Reconciliation Welfare
    Proposal. June 11, 1996
        JCX-30-96--Estimated Budget Effects Of A Committee Amendment To The
    Revenue Provisions Of H.R. 3448, The ``Small Business Job Protection
    Act Of 1996,'' As Approved By The Senate Finance Committee on June 12,
    1996. June 17, 1996
        JCX-31-96--Disclosure Report For Public Inspection Pursuant To
    Internal Revenue Code Section 6103(p)(3)(C) For Calendar Year 1995.
    June 25, 1996
        JCX-32-96--Description Of Chairman's Mark Of Provisions Relating To
    The Earned Income Credit. Scheduled for Markup by the Senate Committee
    on Finance on June 26, 1996. June 25, 1996
        JCX-33-96--Estimated Budget Effects Of Earned Income Credit
    Provisions Contained In S. 1795 The Chairman's Mark to be Considered at
    Markup of the Senate Finance Committee on Wednesday, June 26, 1996.
    June 25, 1996
        JCX-34-96--Description Of Managers' Amendment To The Revenue
    Provisions Of H.R. 3448 (The Small Business Job Protection Act Of 1996)
    As Reported By The Senate Finance Committee. July 9, 1996
        JCX-35-96--Estimated Budget Effects Of Revenue Provisions In H.R.
    3448 Including The Managers' Amendment. July 9, 1996
        JCX-36-96--Estimated Budget Effects Of Revenue Provisions In H.R.
    3448 As Passed By The Senate. July 9, 1996
        JCX-37-96--Description Of Selected Federal Tax Provisions That
    Impact Land Use. Scheduled for a Hearing Before the Subcommittee on
    Oversight of the House Committee on Ways and Means on July 16, 1996.
    July 11, 1996
        JCX-38-96--Markup Of Ways And Means Committee Amendment To Be
    Offered To H.R. 3592 (Water Resources Development Act Of 1996).
    Scheduled for July 17, 1996. July 16, 1996
        JCX-39-96--Comparison Of Revenue Provisions Of H.R. 3734 (Welfare
    Reform Reconciliation Act Of 1996) As Passed By The House And Senate.
    Prepared for the Use of the House and Senate Conferees. July 25, 1996
        JCX-40-96--Comparison Of The Estimated Budget Effects Of The
    Revenue Provisions Of H.R. 3734, The ``Welfare Reform Reconciliation
    Act Of 1996,'' As Passed By The House And The Senate. July 25, 1996
        JCX-41-96--Comparison Of Revenue Provisions Of H.R. 3103 (The
    ``Health Coverage Availability And Affordability Act Of 1996'') As
    Passed By The House And The Senate. Prepared for use of the House and
    Senate Conferees. July 26, 1996
        JCX-42-96--Comparison Of Estimated Budget Effects Of The Revenue
    Provisions In H.R. 3103, The ``Health Coverage Availability And
    Affordability Act Of 1996''. July 26, 1996
        JCX-43-96--Description Of Tentative Agreement Relating To Medical
    Savings Accounts (``MSA's''). Prepared for the Use of the Conferees for
    the Revenue Provisions of H.R. 3103 (The ``Health Coverage Availability
    and Affordability Act of 1996''). July 26, 1996
        JCX-44-96--Comparison Of The Estimated Budget Effects Of The
    Revenue Provisions Of H.R. 3448, The ``Small Business Job Protection
    Act Of 1996,'' As Passed By The House And Senate. July 29, 1996
        JCX-45-96--Written Testimony Of The Staff Of The Joint Committee On
    Taxation Regarding H.R. 3244, The ``District Of Columbia Economic
    Recovery Act'' for the Subcommittee on the District of Columbia of the
    House Committee on Government Reform and Oversight 104th Congress on
    July 31, 1996. July 31, 1996
        JCX-46-96--Estimated Budget Effects Of The Conference Agreement
    Relating To The Revenue Provisions Of H.R. 3103, The ``Health Insurance
    Portability And Accountability Act Of 1996''. August 1, 1996
        JCX-47-96--Estimated Budget Effects Of The Conference Agreement
    Relating To The Revenue Provisions Of H.R. 3448, The ``Small Business
    Job Protection Act Of 1996''. August 1, 1996
        JCX-48-96--Draft Analysis Of Issues And Procedures For
    Implementation Of Provisions Contained In The Line Item Veto Act
    (Public Law 104-130) Relating To Limited Tax Benefits. November 12,
    1996
        JCX-49-96--Selected Background Information And Data On Federal
    Transportation Excise Taxes. Prepared for the Use of the House
    Committee on Ways and Means. December 17, 1996
                                     ______

    Attachment C.--Joint Committee on Taxation Revenue Estimate Requests

            Calendar year

    1985..............................................................   348
    1986..............................................................   474
    1987..............................................................   420
    1988..............................................................   900
    1989.............................................................. 1,290
    1990.............................................................. 1,286
    1991.............................................................. 1,461
    1992.............................................................. 2,350
    1993.............................................................. 2,380
    1994.............................................................. 1,259
    1995.............................................................. 2,278
    1996.............................................................. 1,792
                                     ______

                           Attachment D.--Memorandum
                                                     December 10, 1996.
    TO: Chief of Staff, Joint Committee on Taxation
    FROM: Senior Refund Counsel
    SUBJECT: Refund Section--Calendar Year 1996 Operations Report

        This is a report on the more significant developments in this
    Office during the past calendar year.
                                    summary
        Volume--Refund Cases.--486 reports were received during the year.
    The total dollar amount of refunds was $4,649,152,429.

    ----------------------------------------------------------------------------------------------------------------
                                                                                                             1996
                            Reports Received                             1993        1994        1995      (through
                                                                                                             Nov.)
    ----------------------------------------------------------------------------------------------------------------
    Examination Division............................................         512         482         425         360
    Appeals Division................................................         171         147         132          98
    Department of Justice...........................................          18          18          20          23
    Chief Counsel...................................................           8           6           2           5
                                                                     -----------------------------------------------
          Total.....................................................         709         653         579         486
                                                                     ===============================================
    Concerns \1\....................................................          70          69          79         103
    ----------------------------------------------------------------------------------------------------------------
    \1\ Includes 9 post review deficiency cases for 1993, 8 for 1994, 12 for 1995 and 11 for 1996. Includes all
      concerns in which the Service has indicated agreement with our position and which are expected to be signed
      and closed by year end.

        Post Review.--The Service reports 64 large deficiency cases to us
    annually for post review. Eleven of these cases generated concerns this
    year. We also review to a limited extent the Appeals Division's
    nationwide post review results.
        Other Action.--(1) We transmitted for consideration of legislative
    action 9 issues that arose in various cases.
        (2) We transmitted 7 memoranda suggesting corrections or discussing
    clarification of Service procedural or technical instructions.
        (3) We transmitted our concern to the Service on three issues to
    ensure uniform application of the tax laws.
        (4) We transmitted information to the Service in connection with a
    $34,000,000 refund report that led the Service to withdraw the report
    to consider whether they should reexamine the propriety of the refund.
        Exhibits and Appendices provide detailed information on most of the
    foregoing.
        Errors identified by us in 1996 and prior years, and agreed to by
    the Service in 1996 produced a net reduction in refunds of $10.6
    million. The average annual reduction for the last 6 years is $9.1
    million. Such correction also reduced ATNOLCF's, $133.7 million,
    AMFTC's $4 million, and regular tax NOL's and future deductions $5.5
    million. We also brought to the attention of the Service an error in a
    proposed closing agreement that understated tax liability by
    $32,500,000.
        We hope we are satisfactorily accomplishing our assigned portion of
    the Committee's mission and meeting your expectations. We look forward
    to a productive, challenging year.
                                     ______

     Appendix C.--Proposals for Statutory, Ruling, Regulatory, and Manual
                                    Changes
                         (initials of originator shown)
        Discussion with the Hill on the holding in the Fluor Corporation
    case for purposes of legislative action. That case holds that when a
    deficiency is wiped out by a foreign tax credit carryback, the taxpayer
    is not liable for interest on the deficiency. (NB)
        Discussion with the Hill on interest netting in the context of
    allocating deductions for the purpose of determining foreign source
    income, combined taxable income, and taxable income from the property,
    for purposes of legislative action. (NB)
        Memo to the industry specialist for utilities discussing some of
    the problems we have encountered in the section 1341 area. He indicated
    this would go on the utility bulletin board so that everyone handling
    these items would be aware of the problems. (NB)
        Memo to the Chief of Staff discussing interpretative problems with
    section 172(b)(1)(C), for consideration of legislative action. (NB)
        Memo to the Chief of Staff discussing problems associated with
    accounting for rotable spare parts, for consideration of legislative
    action. (NB)
        Memo to the Assistant Chief Counsel (Income Tax and Accounting)
    pointing out a conflict between several interpretations of the
    interplay between sections 616 and 263A. (JB)
        Memo to the National Office Joint Committee Coordinator suggesting
    modification of IRM 8941 to take into account court decisions holding
    that a payment can be a payment of tax without assessment. (RWF)
        Memo to the National Director of Appeals suggesting modification of
    IRM 8953 to aggregate work units closed simultaneously in determining
    Joint Committee jurisdiction. (RWF)
        Memo to the Hill suggesting clarification of similar liability
    language in section 809(b)(5)(C). (JB)
        Memo to the Chief of Staff noting that the parenthetical language
    in section 927(a)(2)(B) raises the question as to whether the license
    of computer software is covered thereby, for purposes of legislative
    action. (NB)
        Memo to the Director Office of Large Case Programs (Appeals),
    advising that an employee suggestion for changes in the Service's Joint
    Committee procedures be considered. (RWF)
        Memo to the National Office (Examination) regarding Joint Committee
    review of Foreign Sales Corporations. (RWF)
        Memo to National Office (Examination) suggesting the correct
    procedure for applying an overpayment in excess of $1,000,000 to offset
    a liability for special estimated tax under section 847. (RWF)
        Memo to the National Office offering our opinion as requested on a
    procedural issue. (RWF)
        Memo to the Hill suggesting a technical correction to clarify
    whether a section 847 deduction can result in an alternative minimum
    tax liability that would not have otherwise existed. (JB)
        Memo to the Hill suggesting that section 835 be eliminated since
    the reason for its enactment no longer exists, or to provide for its
    treatment causing a refundable or nonrefundable credit. (JB)
        Memo to the Hill regarding correction of the section 164 reference
    in section 59A. (JB)
        Memo to Appeals regarding the authority of an Appeals Chief, under
    Order 154, to submit a Joint committee report when the Case was settled
    by District Counsel. (RWF)
        Sent information to the Service and asked whether the Service
    thought it advisable to reexamine the propriety of the refund, which
    was $34,000,000. The Service requested permission, which we granted, to
    withdraw the refund report to determine if any portion thereof should
    be recouped. (BW)
        Discussed with the Service problems of general application
    involving specified liability losses. (RG)
                                     ______

                               EXHIBIT I.--REPORTS TO JC AS REQUIRED BY IRS CODE SEC. 6405
                                                  [Calendar year 1996]
    ----------------------------------------------------------------------------------------------------------------
                                                                          Cumulative
                        Month                       Received  Cumulative    monthly       Dollar          Dollar
                                                                 total      average      receipts        receipts
    ----------------------------------------------------------------------------------------------------------------
     January.....................................         35          35        35.0    $425,696,759    $425,696,759
    February.....................................         47          82        41.0     384,196,568     809,893,327
    March........................................         55         137        45.7     540,525,945   1,350,419,272
    April........................................         43         180        45.0     346,542,304   1,696,961,576
    May..........................................         56         236        47.2     368,589,792   2,065,551,368
    June.........................................         39         292        45.8     399,213,721   2,464,765,089
    July.........................................         60         335        47.9     595,679,430   3,060,444,519
    August.......................................         31         366        45.8     245,737,363   3,306,181,882
    September....................................         55         421        46.8     788,095,751   4,094,277,633
    October......................................         28         449        44.9     248,452,491   4,342,730,124
    November.....................................         37         486        44.2     306,422,205   4,649,152,329
    December.....................................  .........         486  ..........  ..............   4,649,152,329
    ----------------------------------------------------------------------------------------------------------------

                                     ______

    EXHIBIT II.--JOINT COMMITTEE CASES RECEIVED IN 1996 BY TYPES OF TAXPAYER
                                   AND SOURCE
    ------------------------------------------------------------------------
                                                          Cases     Percent
    ------------------------------------------------------------------------
    Types of Taxpayers:
        Individuals...................................         31       6.38
        Estates.......................................         10       2.06
        Trusts........................................  .........  .........
        Corporations..................................        445      91.56
                                                       ---------------------
          Total.......................................        486     100.00
                                                       =====================
    Source of Reports:
        Examination...................................        360      74.07
        Appeals.......................................         98      20.17
        Justice.......................................         23       4.73
        Tax Court.....................................          5       1.03
                                                       ---------------------
          Total.......................................        486     100.00
    ------------------------------------------------------------------------

                                     ______

                       EXHIBIT III.--MONTHLY RECEIPTS--REFUND REPORTS FROM EXAMINATION AND APPEALS
                                                  [Calendar year 1996]
    ----------------------------------------------------------------------------------------------------------------
                                 Month                               Examination  Cumulative    Appeals   Cumulative
    ----------------------------------------------------------------------------------------------------------------
    January........................................................           22          22          12          12
    February.......................................................           35          57           7          19
    March..........................................................           47         104           6          25
    April..........................................................           25         129          13          38
    May............................................................           46         175           9          47
    June...........................................................           31         206           8          55
    July...........................................................           39         245          15          70
    August.........................................................           27         272           2          72
    September......................................................           37         309          14          86
    October........................................................           20         329           7          93
    November.......................................................           31         360           5          98
    December.......................................................  ...........         360  ..........          98
    ----------------------------------------------------------------------------------------------------------------

                                     ______

                  EXHIBIT IV.--1996 JOINT COMMITTEE ON TAXATION CONCERNS \1\ ON REFUND REPORTS FROM IRS
    ----------------------------------------------------------------------------------------------------------------
                                                                                                       Total No. of
                                                                       Examinations       Appeals        concerns
                                                                                                          issued
    ----------------------------------------------------------------------------------------------------------------
    Number of concerns issued.......................................              56              32              88
    Percent of total concerns issued................................              63              37             100
    Total reports received..........................................             360              98             458
    ----------------------------------------------------------------------------------------------------------------
    \1\ Number of Concerns does not include 15 on deficiency cases.

                          additional Responsibilities

        Mr. Kies. Mr. Chairman, the only thing I would add to that
    is just to note that the Joint Committee has been requested to
    do other activities in the last two Congresses that have added
    to its responsibilities.
        We were recently requested by the chairmen of the two tax-
    writing committees and the ranking members to conduct an
    investigation of whether the Internal Revenue Service has
    engaged in any inappropriate activity with respect to the
    selection of 501(c)(3) and (c)(4) entities for audit. That is
    quite a substantial project that we have underway, in addition
    to the responsibilities that we will have to deal with in
    connection with the budget agreement.
        We also have been asked, for example, by Senator Murkowski,
    to do an analysis of all tax provisions relating to the
    electric utility industry for purposes of his work in the
    Energy Committee and looking at the whole deregulation issue.
        These kind of responsibilities come up on a fairly regular
    basis and are in addition to the regular legislative work that
    we do for the Ways and Means Committee and the Senate Finance
    Committee. We also do much of the technical work in connection
    with the Senate Foreign Relations Committee's approval of tax
    treaties and protocols, which is another responsibility that we
    have, so that is in addition to the normal legislative
    responsibilities of the staff.

                               Revenue estimating

        Senator Bennett. Let me ask you a question about revenue
    estimates, because one of the most frustrating things for me as
    a businessman coming into the Government is to discover that
    there is no such thing as a monthly close, whereby you can get
    a report of how well you did last month, how close you came to
    your targets. I do not think there is such a thing as an annual
    close.
        One of the frustrating questions is, does anybody keep
    track of how close tax revenues come to estimates, the
    estimates made prior to the passage of a tax bill?
        To be specific, Marty Feldstein, in writing in the Wall
    Street Journal, estimated several years after the fact, that
    the tax increases enacted during the first year of the Clinton
    administration had produced one-third as much revenue as had
    been estimated at the time we voted for that.
        I have raised this issue with CBO and am told that I should
    talk to you, and that you are the people who do all of this.
    Could you comment on an analysis after the fact, the tracking,
    if you will, of how much, putting it in business terms, a price
    increase did contribute to the bottom line, or how much a price
    decrease did contribute to increased market share and increased
    sales?
        I know those are not the Government terms, but you know
    exactly what I am talking about.
        Mr. Archer. I understand, Mr. Chairman, and I have had the
    same concern that you have expressed over a number of years and
    have importuned the Joint Committee on Taxation to give us that
    kind of information. In previous Congresses, I have been told
    it really is very, very difficult to do, and as a result, it
    was never forthcoming. We are seeing more of that now in the
    last Congress. We are not there on an automatic basis, but
    individual Members can make requests of the Joint Committee to
    provide what actual receipts there were in certain categories,
    broad categories, and make a comparison to the estimates which,
    of course, are already out there and a matter of record.
        One thing the Joint Committee has done at the request of
    both Senator Roth and myself is that they have illuminated for
    the first time to the Members of Congress their method of
    calculating capital gains, and in doing so, they have done
    exactly what you mentioned--compared what the estimates were at
    the time and compared what the actual revenues have been.
        Then they have also overlaid their new model all the way
    back into the 1970's and taken the available data at that time
    on which the estimates were prepared and put it into their
    computer model to get an overlay of what they would have
    estimated with their new computer model.
        They are within 3 percent over the long term with their
    current computer model, because they now do take into account
    behavioral response and the induced realizations from more
    sales of capital assets whenever the tax goes down and less
    sales when the tax goes up.
        I will let Ken comment more in trying to respond to your
    question.

                              Tracking experience

        Mr. Kies. Senator, one of the things that we have done in
    the last couple of years, actually in recognition of the very
    point that you have raised, is starting to try and pick out
    specific estimates that we did and then track the actual
    experience going forward to see how well we have done in terms
    of predicting.
        The one thing that is important to realize when you talk
    about revenue estimates is, that is what they are, estimates.
    And, even though a specific number appears on a piece of paper,
    it is the consequence of a lot of judgment which goes into
    that.
        Some estimates have a much better--we have much greater
    confidence at the outset than others. For example, on the child
    credit that has been proposed, we have a high degree of
    confidence in the revenue estimate because we do not expect a
    behavioral response to enacting a child credit. In our computer
    model, we have 200,000 individual tax returns selected to
    represent a cross-section of all tax returns, and we would do
    an estimate on this basis.
        Like the child credit, we would actually recalculate the
    tax on all of those returns, and then expand those results to
    reflect what we would expect from all 130 million households.
        So, on the other hand, other estimates where the data is
    not specifically part of the tax model represent a lot more
    judgment. Last year we had an adoption credit, and there was
    very little in the way of hard data on the number of adoptions
    that occur each year, foreign and domestic, and so that is an
    example where we have to draw from secondary sources to try and
    come to a judgment about what the cost of a provision like that
    would be.
        It would not surprise me that when we look back 2 or 3
    years we would have a greater error factor on an estimate like
    that because of the fact that we had to rely on information
    that was not coming from the tax sources, but we realize that
    Members do want us to look back and try and figure out how well
    we have done so we can do better in the future.
        A good example of where we have improved our estimating
    capability as a result of realizing that we made a mistake in
    the past was the initial estimates on individual retirement
    accounts in 1981. People started using IRA's much faster than
    we had anticipated. Actually, once we got out about 5 or 6
    years, the estimate kind of converged with actual experience,
    but in the early period the utilization was far greater than we
    had anticipated.
        We used that experience when we estimated medical savings
    accounts last year because they had many of the same features
    as IRA's. There are differences, but there is a lot of
    similarity, and so we looked to the experience on IRA's to try
    to predict how quickly the takeup rate on MSA's would be.
        In the case of MSA's, not only will we be looking back at
    how accurate our estimate is, but we put in place in the
    legislation reporting to actually identify fairly quickly how
    many MSA accounts were established, and that first report will
    come in, I believe, in August or September of this year, which
    is essentially 1 year after the legislation was enacted.
        So I think you will see us doing more and more of this,
    because we want to always be improving what we are doing in
    terms of predictability, but we also realize this is the kind
    of information Members want to have because they want to get
    some feel for how reliable the work we are doing is, and so our
    whole philosophy for the past 3 years is that the more the
    people know about the estimating methodology, the higher the
    confidence level will be.
        We are not trying to have a black-box-type approach, where
    we just say trust us. We really want Members to understand what
    we are doing and how we are doing it.

                                Luxury boat tax

        Senator Bennett. Let me share with you a personal example
    of how a lack of this information can skew public policy. When
    I first came to the Senate, I was approached by John Chafee and
    he asked me if I would cosponsor a bill to repeal the boat tax,
    the luxury boat tax, and you remember how that tax destroyed an
    industry, and I said, why, of course, John. I am startled that
    the tax has not been repealed long before now, given the damage
    that it did.
        He said, well now, be careful before you sign up too fast,
    because you have to sign up not only for the repeal of the tax,
    but for the enactment of some other kind of tax to offset the
    revenue loss that comes from the repeal. I said, now, John,
    there is no revenue loss that will come from repeal. There will
    be a revenue gain that will come from repeal overall by virtue
    of the fact that the industry may come back. I am not sure that
    it has. I mean, that is a classic example of Government
    stupidity.
        He said no, the thing is scored as x percent of x number of
    sales. The fact that those sales are not taking place, and,
    therefore, that percentage is never realized, does not change
    the fact that it is scored in that fashion, and in order to
    repeal the tax under the Budget Act we have to offset that by
    increasing taxes someplace else, and you may not want to sign
    up for a bill that can be attacked as a tax increase somewhere
    down the line.
        I signed up for the bill anyway and kind of looked the
    other way while the figures were artificially created to look
    like there would be some kind of revenue offset. Again, coming
    from the business world, I would not tolerate that from one of
    my managers for 10 seconds.
        I would say, you have got a product on the shelf that has
    failed. Pull it off the shelf right now. Move it through a
    garage sale if necessary, but get rid of it, realize whatever
    you can out of it, even if it is scrap, but do not sit here and
    tell me that we have to offset the revenue that we have lost by
    taking that product out of our product line by increasing
    prices on our other products.
        But that is essentially what the Government is doing, and I
    would look to the Joint Committee on Taxation to stand up and
    say, overall revenue to the Government was lost in the
    following amounts as a result of that tax, and, therefore, the
    tax can and should be repealed without any revenue impact,
    without any negative revenue impact.
        Am I whistling in the dark on this? Is there any
    possibility for that kind of analysis out of your committee in
    a future circumstance?

                            Macroeconomic estimates

        Mr. Archer. Well, let me try to jump in as briefly as
    possible, and Ken may want to add something to it. There are
    two aspects to these revenue estimates. One is the
    macroeconomic impact of whatever occurs, which means are you
    going to increase economic activity, are you going to decrease
    economic activity, and, therefore, you have got a reflow of
    money into the Treasury either positive or negative as a result
    of what you do.
        Then there is the micro aspect which you just talked about.
    What will happen to a particular industry, or what will be the
    behavioral response to capital gains insofar as the sale of
    capital assets is concerned, but then what macroeconomic impact
    that will have is a different thing.
        The way we are currently set up, and I had chafed at this
    for many, many years, is that CBO sets the macro baseline and
    they make no adjustment, irrespective of what is done to the
    Tax Code. The Joint Committee has not had, probably not the
    legal capability, and certainly not the computer capability to
    do that.
        So if we have, for example, an impact, let us say, of the
    luxury boat tax, you can pretty well isolate it and say there
    will be a behavioral response by purchasers of boats that will
    reduce the amount of static analysis tax revenues, but nobody
    takes into account the fact that there are jobs that are going
    to be lost, so the payroll tax is going to be reduced and the
    income tax revenues are going to go down because dealers are
    going to have less sales and so on and so forth.
        Even to this day we have not solved that problem and it, to
    me, is one that must be solved, because the CBO gives us a
    baseline, a macroeconomic baseline twice a year, and they do
    not adjust it in between, with apparently one exception, which
    occurred last week. [Laughter.]
        But if that is not unique, it is exceedingly rare, and so
    here we take up a tax bill and the Joint Committee has to put
    their estimates on top of an economic baseline, that is the
    macroeconomic projections by the CBO, as if a tax change is
    going to have absolutely no bearing on it, and they have to do
    it that way, and so we have a long way to go to really get more
    accuracy. Then there is the question of what are the results
    compared to what are the estimates initially going in?
        Well, what are the results: No. 1, as a result of what
    happened to the overall economy macrowise? What did this path
    do in reality compared to what the static analysis projected
    path was that CBO gave us? That explains a lot of the
    difference in revenues, and so you have to accept, under
    today's estimating practice, the fact that the Joint Committee
    cannot do anything about that.
        Now, when you talk about Marty Feldstein's analysis of the
    1993 taxes, and I suspect that analysis is valid, part of that
    was what happened to the macroeconomy compared to what the
    baseline was, and I think we have just got to find a way to do
    a better job on the macro side.
        Part of it was also the effect of behavioral response in
    specific areas like you mentioned, the luxury boat tax and so
    on. And again, Ken may want to add something. I am just
    scratching the surface of this issue, but it has frustrated me
    in the years that I have been on the Joint Committee and on the
    Ways and Means Committee, and we are at least on the threshold
    of looking at it and trying to do something about it.
        Mr. Kies. I would just add a couple of things, Senator.
    First, in terms of Professor Feldstein's analysis, we have
    actually looked fairly closely at how he has analyzed the
    effects of the 1993 act.
        I would say that his analysis is somewhat preliminary, and
    the reason--CBO adjustment in revenue shares may suggest that
    he is way off--that the CBO baseline adjustment that Chairman
    Archer referred to last week has increased their projected
    revenue stream by over $45 billion a year over 6 years, which
    may suggest the preliminary analysis of Professor Feldstein may
    not necessarily tell the whole story, but it is the kind of
    thing that we want to keep looking at.
        In terms of the issue on the excise tax on boats, our
    estimate, which was done in 1990, which did precede a period of
    somewhat of an economic downturn, did assume a decline in boat
    sales. I mean, that was a part of our estimate.
        In fact, I testified on January 11, 1995, to a joint House-
    Senate Budget Committee hearing on the issue of overall revenue
    estimating, and that testimony actually went into great detail
    about our estimate on the excise tax on boats, because it has
    gotten a lot of attention. Our assumption on sales was not that
    far off.
        The issue that makes this a more complex question is what
    one has to assume about the effects of the declining sales. If
    sales declined in the boat industry, that means that probably
    not as much capital will be employed in the boat industry, but
    it will go somewhere else in the economy.
        How quickly it moves there, how quickly jobs shift out of
    the boating industry and into some other industry, becomes a
    difficult thing to assess in terms of analyzing the overall
    revenue flows to the Federal Government. But, one cannot only
    look at the boating industry for purposes of determining what
    the revenue effect on the Federal budget has been, because the
    shift will create economic activity elsewhere, and that is
    where these kinds of estimates do become very complicated.
        The one thing that I think Members of Congress might well
    have asked about when the boat tax was considered is what the
    regional dislocation was going to be, so that they would have
    been better informed about what the consequences to areas of
    the country were. This is a significant component of the
    industry.
        But, I will make sure that I send you a copy of the
    analysis we did do after the fact of our estimate on the boat
    tax because I think you will find that it may have been a lot
    more accurate than people have portrayed by only looking at the
    effects on the boating industry itself, and not taking into
    account the overall effects.
        Senator Bennett. Well, I would be glad to receive it and
    look through it with interest, but I am less concerned about
    flogging the boat tax horse than I am about the overall issue,
    and if I understand you correctly, Mr. Chairman, there is a
    disconnect between the Joint Committee on Taxation and the CBO
    in some of these areas.
        It may well be that this committee and its corresponding
    committee in the House become the only nexus for oversight of
    both groups, where this issue can be discussed and raised, and
    it is always good to raise issues at appropriations time. We
    seem to have people's attention more at that point than at any
    other, and I intend to raise this with CBO when they come
    before this committee, and anything you can give me as
    ammunition, not to embarrass but to resolve these kinds of
    things so that we go in the right direction, I would be very
    happy to receive.
        Not to repeat again, but just to stress for clarity's sake,
    nothing can be more difficult when you are running a $1.7
    trillion exercise, or enterprise rather, than to do it with
    inaccurate information, with estimates that are based on
    formulas that are never checked up on, that are never compared
    to reality, forward-making decisions like the budget deal that
    was achieved over the weekend based on those estimates that do
    not ever look back and say, well, we have to change our model.
        It would drive a CEO crazy to run a $1.7 trillion
    enterprise with this kind of internal financial information,
    and it may be one of the major reasons why we do so poorly with
    our shareholders. They do not understand the details, but they
    sure understand in general terms how badly the Government is
    floundering in some of these areas. We do not have crisp
    answers.
        All right. I raised this issue with Senator Packwood when
    he was chairman of the Finance Committee, and he provided me
    with information that indicated that the luxury boat tax
    produced x amount less than was projected in revenue, and that
    the luxury car tax, as I recall, was three times greater than
    the amount estimated.
        Again, to a businessman that means there is a lot less
    price resistance to buying luxury cars than there is price
    resistance to buying luxury boats, and you price your product
    based upon price resistance that is out there in the
    marketplace, and we were able to say, people are still going to
    buy a $150,000 Mercedes, even with the luxury tax on them,
    because they are not buying them just for transportation.
        You can get to your destination just as warm and just as
    dry in a Ford Escort as you can in a $150,000 Mercedes. Your
    ego might not feel quite as good in the Ford Escort, and it
    might not last as long in terms of the number of years you have
    it, but if you are buying basic transportation, you do not
    necessarily buy a Mercedes.
        The luxury tax apparently did not deter people from buying
    luxury cars to nearly the degree that it was estimated, and the
    tax writers--now you are wearing your hat as chairman of Ways
    and Means--ought to know that and ought to be looking back, as
    they continue to write taxes, and say, well, we missed it on
    this one. This time, what will happen?
        OK. Enough said.
        Mr. Archer. Mr. Chairman, you are exactly right. What we
    should seek in the estimates is accuracy. We should not seek to
    put our political imprint on them and say we know this is going
    to give us more, or we know this is going to give us less, but
    we should seek accuracy, and it does mean that we have got to
    review what has been done in advance compared to what actually
    happened in reality, and I will sign up to be a soldier in your
    crusade for that.
        Senator Bennett. You will not be a soldier. You will be a
    general. [Laughter.]
        Mr. Archer. I would like to sign you up as a general in my
    crusade to get rid of the need to do all of this by abolishing
    the income tax completely and totally, and replacing it with a
    consumption tax, and then we will not have to go through all of
    this.
        Senator Bennett. I would be delighted to sit down over a
    bowl of Senate bean soup and pursue that with you.
        One of my goals is to make the Tax Code in this country
    simple, neutral, and stable so that it does not favor one group
    over the other--that is the neutrality; people can understand
    it--that is the simplicity; and people can make plans not
    expecting Congress to change it every 18 months, and I am
    willing to look at a flat tax, I am willing to look at a
    consumption tax, and I am willing to look at anything.
        Well, we can do that when we are not in this context.
        Mr. Archer. If we can do that, then I will be the first to
    jump before your committee and say cut the appropriations for
    the Joint Committee on Taxation.
        Senator Bennett. Well, that may be one of the incentives to
    get us moving in that direction.
        We have some more technical type questions about the work
    of the Joint Committee on Taxation that I would like to submit
    to you in writing. We would appreciate your response to those.

                         Additional committee questions

        Mr. Kies, I would say you were the topic of a front page
    article in the Wall Street Journal which I am sure did not make
    you real happy, and we will probably have some questions on
    that in writing for you as well. I think that you should have
    the opportunity to respond on the record, but I will not raise
    those to the level of a public hearing in a public discussion.
        Senator Dorgan, who had to be excused because of the
    pressures of flood conditions in his home State, would
    appreciate a clearing of the air on some of those issues.
        [The following questions were not asked at the hearing, but
    were submitted to the Joint Committee for response subsequent
    to the hearing:]
                         Additional Committee Questions
        Question. In your budget submission you noted that the JCT received
    over 1,750 revenue requests in 1996. Of that number, how many revenue
    estimates were answered by JCT? How many of those answered were for new
    legislative proposals versus legislation which had been previously
    estimated?
        Answer. Of the 1,799 requests for revenue estimates received in
    calendar year 1996, the staff of the Joint Committee on Taxation
    responded to 803.
        It is extremely difficult to quantify how many of the revenue
    requests answered by the staff of the Joint Committee on Taxation were
    for new legislative proposals versus legislation that had been
    previously estimated. If a bill is introduced in both the House and the
    Senate during a session, it is not uncommon for the Members sponsoring
    the legislation in the House and the Senate to request revenue
    estimates. However, the staff of the Joint Committee estimates that a
    relatively low percentage of revenue estimate requests fall into this
    category. In addition, if a request is similar or identical to a
    proposal that the Joint Committee staff has previously estimated, there
    is still a substantial amount of work entailed in responding to the
    request. The Joint Committee staff is always reviewing and updating its
    estimating methodology to account for (1) updated economic assumptions
    provided by the Congressional Budget Office, (2) improvements in
    computer modeling, (3) new information that may have become available,
    (4) new information provided by potentially affected taxpayers, and (5)
    changes in proposed effective dates and forecasted enactment dates.
    Thus, the fact that a revenue request has been previously estimated by
    the Joint Committee staff does not necessarily reduce the time required
    to respond to the current request.
        Question. How many requests have you received to date? What is the
    estimate for fiscal year 1997?
        Answer. As of June 1, 1997, the staff of the Joint Committee on
    Taxation has received over 1,000 requests for revenue estimates for
    calendar year 1997. [Note that all of the Joint Committee statistics
    are kept on essentially a calendar year system, which reflects the
    timing of legislative sessions.] It is projected that the staff will
    receive well over 2,000 requests for revenue estimates for all of
    calendar year 1997.
        The number of revenue requests received in any calendar year
    generally is determined by the amount of revenue legislation considered
    by the Congress during the year. However, there has been a fairly clear
    trend since the mid-1980's of increased numbers of requests for revenue
    estimates as the focus upon the budget impact of proposed legislation
    has continued to increase.
        In addition, if the Supreme Court overturns the decision of Judge
    Jackson with respect to the Line Item Veto Act (the ``Act''), the Joint
    Committee on Taxation staff anticipates that Members will routinely
    request information as to the status of proposed legislation under the
    Act. Thus, it is anticipated that the workload of both the economists
    and the attorneys on the Joint Committee staff will increase even more
    and it will be necessary to begin compiling statistics relating to the
    number of requests made for determinations under the Act.
        Question. At the House hearing, the Chief of Staff Kies said that
    JCT was about to complete a year-long study of the Committee's computer
    needs. Has this report been completed? If so, please summarize its
    findings and provide this subcommittee with a copy of the report.
        Answer. The year-long study referred to by Mr. Kies during the
    House hearing is a study of the feasibility of taking into account
    macroeconomic effects of proposed legislation. This study culminated in
    a symposium on January 17, 1997, of noted macroeconomists. In general,
    these macroeconomists concluded that there is not a sufficient
    consensus among the economics profession to take account of
    macroeconomic effects currently, but that if the state of the art can
    be improved, such effects should be taken into account in preparing
    revenue estimates. These economists also recommended that the Congress
    continue to work to improve the ability for such macroeconomic effects
    to be considered. The results of the year-long study and the symposium
    will be published by the staff of the Joint Committee on Taxation in
    the near future.
        As part of this study, the Joint Committee staff has also
    considered the costs (in terms of additional staff time and computer
    needs) of continuing to expand the macroeconomic estimating capability
    of the Joint Committee staff. Because this is a long-term project that
    cannot be completed in a single fiscal year, it is difficult to
    quantify the total projected costs. However, in testimony before the
    House Subcommittee on Legislative, Mr. Kies estimated that
    approximately $200,000 of the Joint Committee staff's requested
    increase for fiscal year 1998 would be devoted to the work relating to
    macroeconomic estimating.
        Question. At the House hearing in response to Congressman
    Thornton's question that ``you give serious consideration to whether
    some reduction from the requested amount for the Joint Committee could
    be made possible by developing a joint use of some of the resources of
    CBO,'' Mr. Archer stated that he would be glad to work with John
    Kasich. Has any progress been made in this area?
        Answer. This question refers to the House Subcommittee on
    Legislative hearing with respect to the Joint Committee on Taxation's
    appropriation request for fiscal year 1997. It is the opinion of the
    Joint Committee on Taxation that there is virtually no overlap in
    responsibilities between the Congressional Budget Office and the Joint
    Committee on Taxation and that no savings could be attained by
    developing a joint use of resources with the CBO. Although the Joint
    Committee staff works closely with the CBO, the two staffs have worked
    over the years to define clearly the areas of jurisdiction and,
    therefore, there are currently no areas in which the Joint Committee
    staff and the CBO staff are performing the same work. Thus, there is no
    economies to be attained by a joint use of resources because there is
    no overlap in work.
        Questions. Last Congress JCT assumed additional responsibilities
    regarding the line-item veto and the determination whether a provision
    affects 100 entities or not. Although the fate of the line-item veto is
    in the courts hands, has JCT expended any fiscal year 1997 funds in
    preparation for its new responsibilities? Are any funds in the fiscal
    year 1998 budget request earmarked for this purposes?
        Answer. Early in fiscal year 1997, the Joint Committee staff spent
    extensive staff time analyzing the provisions of the Line Item Veto Act
    as it relates to revenue legislation. A draft analysis was published in
    November of 1996, with public comment requested by December 16, 1996.
    The final analysis was published by the Joint Committee staff in late
    December.
        Because of the uncertainty over whether the provisions of the Line
    Item Veto Act will be upheld, the Joint Committee staff has earmarked
    no specific funds for fiscal year 1998 to satisfying the staff's
    responsibilities under the Act. If the Act is upheld, it is anticipated
    that the Joint Committee staff will have significant additional
    responsibilities under the Act and responding to Members during the
    consideration of legislation as to whether certain provisions may be
    limited tax benefits subject to the Act.
        Question. At the beginning of the 105th Congress, the House adopted
    a new rule which impacts the scope of work of the JCT regarding
    economic analysis. Has the Majority Leader designated any legislation
    as ``major tax legislation'' yet this year? How many tax bills of this
    designation do you anticipate this years? Next year?
        Answer. The Majority Leader has not yet designated any legislation
    during 1997 as ``major tax legislation.'' Because this is a new House
    rule for which there is no experience, it is impossible to estimate
    with any certainty the number of bills that may be designated as major
    tax legislation. It is likely that any bill that restructures the
    Federal income tax system would be so designated, but it is difficult
    to predict what other legislation might fall into this category.
        Question. Mr. Kies, you were the topic of a front page article in
    The Wall Street Journal on April 17, 1997. The article was critical of
    the amount of travel you did last year at the expense of outside groups
    with interests in tax policy. I understand that you took a dramatic cut
    in salary to take the position of Chief of Staff of the Joint Committee
    on Taxation and I commend you for your public service. However, last
    year was a very busy year. Could you explain how you were able to find
    so much free time to travel? How do you respond to critics who say that
    there is an appearance problem with the amount of travel you accepted
    from outside groups?
        Answer. Concerning this inquiry, several points are relevant.
    First, at no time during calendar year 1996 did my travel interfere
    with my other work as Chief of Staff of the Joint Committee on
    Taxation. Much of my travel was done during Congressional recesses, on
    weekends when the Congress was not in session, or when the Congress was
    not actively considering revenue legislation. In fact, of the 34 out-
    of-town trips that I took during 1996, 29 of them were associated with
    travel which involved either no overnight stay or only a single night
    outside of town.
        Second, the groups that I spoke to included various tax
    professionals groups like the American Bar Association Tax Section,
    various chapters of the Tax Executives Institute, other tax
    professional gatherings and various affected taxpayer groups. Five
    speeches involved lectures at colleges or law schools concerning the
    federal tax and budget legislative process. The expenses were generally
    paid by section 501(c)(3) tax exempt educational organizations. This
    raises a fundamental issue. Each year the Federal Government expects
    taxpayers to voluntarily remit over $1.5 trillion to the Internal
    Revenue Service through a series of complex tax laws which are used to
    finance the varied activities of our Federal Government. Almost all of
    my travel involved speeches to groups to familiarize them with pending
    or recently enacted tax legislation modifying this complex set of
    rules. In 1996, the Congress passed tax legislation which contained
    many complicated provisions increasing revenues over the next 10 years
    by billions, while at the same time including billions of revenue
    losing provisions. Your inquiry raises an important question: ``Should
    Congressional staffers continue to be willing to travel outside of
    Washington to speak to groups impacted by the federal tax system and
    Congressional legislative action in that regard?'' One alternative
    would be to discontinue any such activities. The result would be that
    Congressional staff would be available only to those taxpayers with the
    time and economic resources either to travel to Washington to meet with
    us or those that have Washington offices or representatives. This is
    clearly not a desirable result. On the other hand, if we are to
    continue this type of public service to taxpayers who may not have
    access to Washington counsel, should the Federal Government (i.e.,
    taxpayers) pay for it or should the current practice be continued of
    permitting those groups to whom we give speeches to reimburse the cost
    of such travel accompanied by the full disclosure required under the
    ethics rules? I believe it is essential that we continue to be willing
    to speak to groups like the ABA Tax Section and other taxpayer groups
    affected by Congressional action, but that this is not an expense that
    should be paid by taxpayers. I also do not view this activity as
    something that should be viewed as ``free time'' but rather an
    important responsibility that is inherently related to the work of the
    Congress.
        I am attaching for the record copies of materials that I prepared
    in response to The Wall Street Journal article. These materials have
    previously been shared with all Members of the Joint Committee on
    Taxation, the Senate Finance Committee and the Committee on Ways and
    Means. Moreover, my response to The Wall Street Journal was published
    on April 23, 1997 (copy also attached).
        Question. The JCT budget requests an increase of $5,000 for travel.
    How much money did the JCT spend on travel last year?
        Answer. During fiscal year 1996, the Joint Committee on Taxation
    expended approximately $8,200 for travel expenses. Approximately $1,000
    was expended to send Joint Committee staff members to educational tax
    conferences addressing issues under consideration by the Congress. The
    remainder of the funds were expended for travel to Washington by
    economists on the Joint Committee on Taxation Advisory Board or in
    connection with the macroeconomic symposium.
        The Joint Committee's request for fiscal year 1998 for travel funds
    will assure that the travel budget more closely reflects actual
    expenditures.
                                     ______

                                  Attachments
                         Congress of the United States,
                                   Joint Committee on Taxation,
                                        Washington, DC, April 24, 1997.
    The Honorable William V. Roth, Jr.,
    United States Senate,
    Washington, DC.
    The Honorable Bill Archer,
    U.S. House of Representatives,
    Washington, DC.
        Dear Mr. Roth and Mr. Archer: I am writing to you concerning an
    article which appeared in The Wall Street Journal on April 17, 1997,
    concerning my role as Chief of Staff of the Joint Committee on
    Taxation. This article is replete with inaccurate, biased and
    misleading reporting.
        I am enclosing for your information a letter which I sent to the
    Editor of The Wall Street Journal concerning the article and a separate
    letter which I have sent to Alan Murray, the Washington Bureau Chief
    for The Wall Street Journal, detailing the glaring defects in the
    article.
        If you have any questions concerning the issues raised in this
    article, I would be happy to address them. Please do not hesitate to
    call me if you wish to discuss this matter further.
                Sincerely,
                                                       Kenneth J. Kies.
                                     ______

                         Congress of the United States,
                                   Joint Committee on Taxation,
                                        Washington, DC, April 23, 1997.
    Mr. Ned Crabb,
    Editor, Letters to the Editor, The Wall Street Journal,
    New York, New York.
        Dear Mr. Crabb: Enclosed is a letter to you regarding the article
    which appeared on April 17, 1997, in The Wall Street Journal concerning
    my role as Chief of Staff of the Joint Committee. I would appreciate it
    if you would consider it for publication in the ``Letters to the
    Editor'' section of your paper. I have also enclosed a copy of a letter
    which I have sent to Alan Murray, the Washington Bureau Chief of The
    Wall Street Journal, providing additional detail supporting the
    concerns which I have raised with respect to the April 17, 1997,
    article. I believe that the more detailed information contained in my
    letter to Mr. Murray clearly supports my request that you publish my
    letter to you concerning this article.
        If you have any questions, please do not hesitate to call me.
                Sincerely,
                                                       Kenneth J. Kies.
                                     ______

                         Congress of the United States,
                                   Joint Committee on Taxation,
                                        Washington, DC, April 23, 1997.
    Mr. Ned Crabb,
    Editor, Letters to the Editor, The Wall Street Journal,
    New York, New York.
        Dear Mr. Crabb: I am writing regarding your article of April 17,
    1997, concerning my role as Chief of Staff of the Joint Committee on
    Taxation. This article is replete with inaccurate, biased and
    misleading reporting. Let me address some of the article's most glaring
    problems.
        First, the article implies that I assisted Mr. Vander Jagt in an
    effort to obtain business from Steve Wynn. Since assuming my role as
    Chief of Staff of the Joint Committee on Taxation, I have never engaged
    in any such discussion on behalf of anyone connected with Baker &
    Hostetler or any other firm.
        Second, the article suggests that I provide special treatment to my
    prior law firm, Baker & Hostetler. This assertion is false. Moreover,
    the article fails to note, as your reporter was advised, that since
    assuming the position of Chief of Staff of the Joint Committee, I have
    had a consistent policy of refusing to even meet with any member of the
    firm on any matter pending before the Joint Committee or to discuss
    such matters with them.
        Third, the discussion in your article of the so-called football
    coaches provision fails to portray accurately the history of this
    provision. The article stated that the legislation sought to insert
    special legislation to allow college coaches to set up a tax exempt
    pension plan. However, the legislation involved was a technical
    correction to legislation the Congress passed in 1987 to permit coaches
    to set up such a pension plan. Operating under this prior legislation,
    the college coaches, with the express approval of the I.R.S., had set
    up and were operating such a plan until a technical defect was
    identified with the original legislation. In 1993, Hank Gutman, then
    Chief of Staff of the Joint Committee, ruled that the legislation to
    correct the defect qualified as a technical correction because it would
    accomplish the original intent of the 1987 legislation.
        Fourth, the reference in the article to the legislation affecting
    Fort Howard and Morgan Stanley failed to note that I was by no means
    the only one to have concluded that the legislation was an appropriate
    technical correction or clarification of legislation previously enacted
    by the Congress. The Ways and Means Majority staff, the Senate Finance
    Committee Majority staff and the Treasury Department, among others, all
    supported this conclusion. Moreover, the Ninth Circuit Court of Appeals
    in the case of U.S. v. Croy (Europe)Ltd., 27 F. 3d. 367 (9th Cir.,
    1994) had previously concluded in 1994 that the state of the law was
    already consistent with the 1996 clarification even prior to its
    approval by the Congress.
        Fifth, the article suggests some undefined cause and effect
    relationship between my one-time speech to the 1996 meeting of the
    commercial gambling industry's Tax Executives Committee and a
    legislative proposal to subject Indian gambling to taxation. There are
    two significant defects with this oblique suggestion: first, the
    legislation to impose taxation on Indian gambling passed the House of
    Representatives in the Fall of 1995 while my speech occurred in April
    of 1996; second, to date the commercial gambling industry has been
    unwilling to support such legislation, at least in part as a result of
    the fact that the commercial gambling industry provides substantial
    management and support services to the Indian-owned casinos.
        Finally, your article suggests that my role as Chief of Staff of
    the Joint Committee is different from the role performed by prior
    chiefs of staff. This too is inaccurate. Every chief of staff of the
    Joint Committee prior to me has engaged actively in speaking to
    taxpayer groups both inside and outside of Washington. They, like I,
    have complied with all applicable ethics rules of the Congress in these
    activities, which rules are today more restrictive than ever. This is a
    role that we should continue to fulfill given the significant impact
    which tax legislation has on the public generally and taxpayer groups
    in particular. To do otherwise would be a disservice to the tax system
    and the tax legislative process.
                Sincerely,
                                                       Kenneth J. Kies.
                                     ______

                         Congress of the United States,
                                   Joint Committee on Taxation,
                                        Washington, DC, April 23, 1997.
    Mr. Alan Murray,
    Washington Bureau Chief, The Wall Street Journal,
    Washington, DC.
        Dear Alan: I am writing concerning the recent article which The
    Wall Street Journal published by Greg Hitt regarding my role as Chief
    of Staff of the Joint Committee on Taxation. As I suggested to you in
    my letter of April 10, 1997, I believed that Mr. Hitt was in the
    process of writing a single-mindedly negative article concerning me.
    The content of the story which appeared on April 17, 1997, conclusively
    demonstrated that my suspicions were correct. The article contains
    numerous distortions and inaccuracies and fails to include a balanced
    view on almost any of the issues which Mr. Hitt raised. I have enclosed
    with this letter a point by point response to the various issues which
    Mr. Hitt raised in his article. The responses which I have received
    from many who have read this article have been consistent and are
    similar to my own assessment. First, they fail to see what was
    newsworthy in the article. Second, they believe the article is one-
    sided and inaccurate. Third, they believe that the article falls
    dramatically below the standards for responsible journalism
    characteristic of The Wall Street Journal.
        By this letter I am specifically requesting a letter of apology
    from The Wall Street Journal for the printing of this article. I would
    welcome the opportunity to discuss with you, in as much detail as you
    desire, the specific concerns I have raised in my point by point
    analysis of the article.
                Sincerely,
                                                       Kenneth J. Kies.
                                     ______

      Point by Point Analysis of Distortions and Inaccuracies in The Wall
      Street Journal Article of April 17, 1997, Entitled ``In the Public
      Eye--Tax-Panel Staff Chief Keeps a High Profile; Special Interests
                                     Help''
         wall street journal article contains serious distortions and
                                  inaccuracies
    Text of WSJ Article
        1. When Washington lobbyist Guy Vander Jagt went to Las Vegas to
    court gambling tycoon Steve Wynn last April, he showed up with a
    friend: Kenneth Kies, chief of staff of the congressional Joint
    Committee on Taxation.
        Mr. Wynn and his fellow gambling executives were worried that
    Congress would impose new taxes on their industry's earnings. And Mr.
    Vander Jagt, a former member of Congress, was seeking to boost his
    lobbying business.
        As for Mr. Kies, Mr. Vander Jagt says: ``I thought it would look
    good if I had the chief of staff, and I did.'' The three men had lunch
    on the patio of Mr. Wynn's mansion, overlooking the 18th hole of his
    private golf course. Then Messrs. Kies and Vander Jagt played a round
    of golf.
        Mr. Vander Jagt didn't get the account. But Mr. Kies's presence at
    the outing highlights the unusual license he takes with his job as
    Congress's top tax staffer. The Joint Committee was set up 71 years ago
    to provide technical tax assistance to congressional tax writers, and
    its hear traditionally has avoided the limelight.
    Response
        1. The first four paragraphs of the article concern my meeting with
    Mr. Wynn which was also attended by Mr. Vander Jagt. The thrust of this
    section of the article suggest that I was attempting to assist Mr.
    Vander Jagt in obtaining business from Mr. Wynn. This is categorically
    untrue. Moreover, this section of the article is distorting and
    misleading for a number of reasons. First, at no time during my visit
    to Las Vegas or at any other time since becoming Chief of Staff of the
    Joint Committee on Taxation, have I in any way discussed or assisted or
    encouraged anyone to hire Mr. Vander Jagt or Baker & Hostetler in
    connection with representation of the gambling industry, or any other
    industry. Second, I was in Las Vegas to give a speech to the 1996
    meeting of Hotel & Gambling Industry Tax Executives Committee as a
    result of an invitation which I received from Lee Johnson with Burson-
    Marsteller, a public relations firm with offices in Washington, D.C.
    Mr. Burson-Marsteller has no relationship or connection whatsoever to
    Mr. Vander Jagt or Baker & Hostetler. Third, my entire discussion with
    Mr. Wynn focused on issues wholly unrelated to who represents him or
    the gambling industry. Among the issues we discussed were the prospects
    for federal tax restructuring and other issues of that nature. Finally,
    Mr. Vander Jagt advises me that he has no recollection of the quote
    attributed to him.
    Text of WSJ Article
        2. Then there is his relationship with Mr. Vander Jagt and the
    Cleveland law firm of Baker & Hostetler. Mr. Kies earned $500,000 a
    year as a lobbyist for the firm before leaving two years ago to take
    the congressional tax job. He handed many of his accounts to Mr. Vander
    Jagt, a longtime friend whom he helped land a job at the firm in 1993.
    Response
        2. Prior to taking the position as Chief of Staff of the Joint
    Committee on Taxation, I did not earn ``$500,000 a year as a lobbyist
    for [Baker & Hostetler].'' Rather, I earned this compensation as the
    Firm-wide Chair of Baker & Hostetler's Tax and Personal Planning Group.
    This group consists of over 50 lawyers located in the law firm's six
    offices. The Tax and Personal Planning Group consists of one of the
    four major practice areas of the law firm. In my capacity as Chair of
    the Firm-wide Tax and Personal Planning Group I coordinated all tax
    work for the law firm, participated in the setting of compensation for
    all associates and non-equity partners. My own tax practice included
    tax litigation, other tax controversy work, tax planning and tax
    legislative work. To state that I earned $500,000 a year as a lobbyist
    misrepresents of my role at Baker & Hostetler. A copy of my resume,
    which was provided to Greg Hitt, and my discussions with him made that
    point abundantly clear.
    Text of WSJ Article
        3. In addition to accompanying Mr. Vander Jagt to see Mr. Wynn, Mr.
    Kies last year took trips at Baker & Hostetler's expense to Orlando,
    Fla., Houston, Cleveland, and Columbus, Ohio, where he spoke to the
    firm's clients and prospective clients. ``It helps the firm enormously
    because Washington works on appearances,'' Mr. Vander Jagt explains.
    Mr. Kies ``is enormously important in the formulation of tax law.
    People think, `Well, Baker & Hostetler ought to have a direct pipeline
    into Ken.' ''
        ``Having Ken over there, it's a nice thing,'' adds William
    Schweitzer, managing partner of Baker & Hostetler's Washington office.
    But he says the firm's dealings with Mr. Kies aren't any different than
    they would be with someone else serving as staff director of the Joint
    Committee on Taxation. On the issue of recruiting business, Mr.
    Schweitzer says: ``probably, it gives you a bit of an advantage'' to
    have Mr. Kies positioned on Capitol Hill, but direct connections are
    difficult to make. (Baker & Hostetler also does legal work for Dow
    Jones & Co., publisher of The Wall Street Journal.)
    Response
        3. This excerpt of the article implies that I have given special
    treatment to Baker & Hostetler. It totally distorts the actual
    relationship I have had with Baker & Hostetler since taking the
    position as Chief of Staff of the Joint Committee. In particular, it
    fails to note that since assuming the position of Chief of Staff of the
    Joint Committee, I have had a consistent policy of refusing to even
    meet with either partners or associates of the firm on any matter
    pending before the Joint Committee on Taxation or to discuss such
    matters with them. I adopted this practice after consulting with prior
    Chiefs of Staff of the Joint Committee concerning the way in which they
    handled their own prior relationships with law firms with which they
    had previously been associated prior to taking the position of Chief of
    Staff of the Joint Committee. Failure to include this information
    coupled with the text presented clearly and intentionally conveys an
    unjustly unfavorable impression of me. As you can see from the enclosed
    memo to Greg Hitt dated March 14, 1997, this point was clearly
    communicated to him.
    Text of WSJ Article
        4. Because of his clout, the Washington tax-writing community is
    reluctant to criticize Mr. Kies openly. But because his behavior is so
    unusual, given his staff position, many are uneasy.
        ``I'm a little surprised he's quite as visible as he is,'' says
    John ``Buck'' Capoton, former assistant secretary of the Treasury for
    tax policy in the Reagan administration ``It's a little dangerous to
    get out in front of the members. It's supposed to be their show, not
    his.''
    Response
        4. The article in this excerpt makes the unsubstantiated assertion
    that ``many are uneasy'' with my behavior as Chief of Staff of the
    Joint Committee. Notwithstanding this, the only ``on the record''
    comment included is one from Buck Chapoton. He has advised me since
    this article appeared that the quote used from his interview with Greg
    Hitt completely distorts the lengthy interview which he provided to
    Greg concerning his view of my tenure as Chief of Staff of the Joint
    Committee.
    Text of WSJ Article
        5. The revolving door for government officials is a commonplace in
    Washington. But while executive-branch employees face some strict
    restrictions on their lobbying activities after office, members of
    Congress and their staffers face few such limits.
    Response
        5. The statement that Members of Congress and their staffers face
    few limits on activities that they can conduct after leaving
    government, as contrasted with Executive Branch employees, is flatly
    wrong. Prior to the Clinton Administration, the Executive Branch and
    the Legislative Branch essentially operated under exactly the same
    restrictions--a one-year moratorium on their ability to have contact
    with their prior agency or employer. While it is true that the Clinton
    Administration has lengthened that to five years under some
    circumstances, the nature of the limitation is essentially the same.
    Thus, Members of Congress may not lobby their colleagues for one year
    after leaving office. Likewise, staffs of committees are precluded from
    lobbying staff members of the committee on which they worked or Members
    of such committees for one year after they leave office.
    Text of WSJ Article
        6. But even in the freewheeling world of congressional staffers,
    Mr. Kies's and Mr. Vander Jagt's moves through that revolving door seem
    surprisingly fast.
        As a Baker & Hostetler lobbyist, Mr. Kies unsuccessfully pushed the
    case of the American Football Coaches Association, which was seeking
    special tax legislation that would allow college coaches to set up a
    tax-exempt pension plan. When he took his job in Congress, Mr. Kies
    passed the coaches account on to Mr. Vander Jagt. The provision
    subsequently was included in one version of the GOP's balanced-budget
    bill, which later died. Then it became part of a small-business tax
    bill that was signed into law.
        Mr. Kies denies having anything to do with the measure's success.
    But Sen. Jay Rockefeller, a West Virginia Democrat, made a point of
    publicly highlighting Mr. Kies's ties to the coaches in a meeting of
    the Senate Finance Committee. ``He made some snide comment,'' Mr. Kies
    says. ``I remember much more vividly his 65 questions on coal-miner
    retirees.''
    Response
        6. The discussion in the article of the so-called football coaches
    provision fails to portray accurately the history of this provision.
    The article stated that the legislation sought to insert special
    legislation to allow college coaches to set up a tax exempt pension
    plan. However, the legislation involved was a technical correction to
    legislation the Congress passed in 1987 to permit coaches to set up
    such a pension plan. Operating under this prior legislation, the
    coaches, with the express approval of the I.R.S., had set up and were
    operating such a plan until a technical defect was identified with the
    original legislation. In 1993, Hank Gutman, then Chief of Staff of the
    Joint Committee, ruled that the legislation to correct the defect
    qualified as a technical correction because it would accomplish the
    original intent of the 1987 legislation. While the article discusses
    the exchange which Senator Rockefeller and I had during a markup of the
    Senate Finance Committee, it failed to include the fact that I
    specifically indicated during that exchange that I was recused from any
    discussion of the matter and that I had consistently during my tenure
    recused myself from discussions about this provision. Finally the
    article failed to note that the Football Coaches Association provision
    was included in a bill reported by the House Ways and Means Committee
    in 1993, more than a year prior to my becoming Chief of Staff of the
    Joint Committee.
    Text of WSJ Article
        7. Another case that raised eyebrows involved Mr. Vander Jagt's
    efforts to protect a wealthy client from legislation that would tighten
    tax rules on American who renounce their U.S. citizenship in order to
    escape taxes. Mr. Vander Jagt was retained to represent Joseph
    Bogdanovich, and H.J. Heinz Co. executive who had moved to Britain and
    renounced his citizenship.
    Drafting Error
        The effective date of the bill was Feb. 6, 1995. But in a closed-
    door meeting of the House Ways and Means Committee, GOP lawmakers
    approved a statement that would have allowed the effective date to slip
    by a month, exempting Mr. Vander Jagt's client. Democrats were invited
    to the hastily convened meeting, but many showed up late and the change
    went unnoticed. When Democrats discovered it hours later, they
    protested loudly, and GOP members reversed course. Mr. Kies calls is a
    simple drafting error. But as the top staffer in the room, it was his
    job to advise members on the implications of the change. Democrats
    remain skeptical about the episode.
        ``We've never gotten a satisfactory explanation of how that
    happened.'' says California Democrat Robert Matsui, a senior member of
    the committee. Messrs. Kies and Vander Jagt say they never spoke about
    the issue.
    Response
        7. Concerning this section of the article, at least two points are
    relevant. First, to suggest that I should have been aware of the
    implications of what was a completely innocuous statement concerning
    the expatriation issue as relates to Mr. Bogdanovich when I was wholly
    unaware of the factual circumstances concerning his situation is
    obviously an absurd statement. Second, contrary to the suggestion in
    the article, I was not the only top staffer ``in the room,'' when this
    statement was hastily drafted. In the room at the same time were top
    staffers from the majority and minority side of the Ways and Means
    Committee, both of whom were apparently familiar with the factual
    situation involving Mr. Bogdanovich. I in no way mean to suggest that
    they were attempting to assist Mr. Bogdanovich or Mr. Vander Jagt
    because I firmly believe that the statement was in no way binding
    regarding future action which the Ways and Means Committee or the
    Senate Finance Committee would take on this matter, but was only
    intended to constitute a place holder for future consideration of the
    issue of expatriation.
    Text of WSJ Article
        8. And by just tweaking the language of legislation, Mr. Kies has
    shown he can wield substantial influence on issues important to special
    interests.
        Last year, for instance, he helped clear the way for a little-
    noticed provision that gave millions of dollars in tax benefits to Fort
    Howard Corp. and Morgan Stanley Group Inc., which owns a major stake in
    the Wisconsin paper company. A Democratic-appointed predecessor, Harry
    Gutman, refused to touch the matter, saying it wasn't strictly a
    technical issue and therefore should be left to members of Congress to
    decide. ``I wouldn't do it,'' Mr. Gutman says. Mr. Kies says he got
    involved because he saw the situation differently.
    Response
        8. The reference to the legislation affecting Fort Howard and
    Morgan Stanley failed to note that I was by no means the only one to
    have concluded that the legislation was an appropriate technical
    correction or clarification of legislation previously enacted by the
    Congress. The Ways and Means Majority staff, the Senate Finance
    Committee Majority staff and the Treasury Department, among others, all
    supported this conclusion. Moreover, the Ninth Circuit Court of Appeals
    in the case of U.S. v. Kroy (Europe) Ltd., 27 F. 3d. 367 (9th Cir.,
    1994) had previously concluded in 1994 that the state of the law was
    already consistent with the 1996 clarification even prior to its
    approval by the Congress in 1996.
    Text of WSJ Article
        9. As for his far-flung public speeches, Mr. Kies argues that
    speaking to taxpayers--even if it means traveling extensively--is part
    of his job. Last year, his itinerary included visits to academic
    institutions and nonprofit organizations, as well as trips underwritten
    by Baker & Hostetler and by grocery, real-estate, gambling and energy
    concerns. In all, Mr. Kies took 42 trips paid for by outside groups,
    costing nearly $60,000.
    Response
        9. The article suggest that my role as Chief of Staff of the Joint
    Committee is different from the role performed by prior chiefs of
    staff. This too is inaccurate. Every chief of staff of the Joint
    Committee prior to me has engaged actively in speaking to taxpayer
    groups both inside and outside of Washington. They, like I, have
    complied with all applicable ethics rules of the Congress in these
    activities, which rules are today more restrictive than ever. This is a
    role that we should continue to fulfill given the significant impact
    which tax legislation has on the public generally and taxpayer groups
    in particular. To do otherwise would be a disservice to the tax system
    and the tax legislative process.
    Text of WSJ Article
        10. It was on one such speaking trip last April that Mr. Kies and
    Mr. Vander Jagt visited Mr. Wynn, chairman of Mirage Resorts Inc. Mr.
    Kies was in Las Vegas to speak to a group of hotel and gambling
    executives. His $1,900 in travel and lodging expenses were paid by the
    hotel and gambling interests, according to Rick Darnold, a Boyd Gaming
    Corp. vice president who organized the event.
        Mr. Kies says that after his separate meeting with Mr. Wynn, he
    sent the Mirage chairman a $100 check to avoid the appearance that he
    might be accepting a special gift by playing on his private golf
    course. ``I'm the only person who probably ever paid to play there,''
    he says.
        He says his views aren't influenced by the money spent on him. But
    the gambling executives have reason to feel their money was well spent.
    ``If people have a good understanding of your industry, then they're
    better regulators,'' Mr. Darnold says.
        On the issue of gambling, Mr. Kies talks down a proposal to impose
    tax-withholding requirements on keno and bingo winnings. The gambling
    industry fears that the idea--bandied about in the last Congress and
    endorsed by the Clinton administration--would eventually be broadened
    to include slot machines. And he has strongly endorsed taxing the
    proceeds earned at Indian casinos, which provide untaxed competition
    with the commercial-gambling industry.
        ``I question whether he's got his own agenda,'' says Democratic
    Rep. Gerald Kleczka of Wisconsin, who worries about the impact such a
    tax would have on the 17 Indian-run casinos in his state. ``If you want
    the job of a member of Congress, run for it.''
    Response
        10. The article suggests some undefined cause and effect
    relationship between my one-time speech to the 1996 meeting of the
    commercial gambling industry's Tax Executives Committee and a
    legislative proposal to subject Indian gambling, which currently enjoys
    tax free treatment, to the income taxation regime imposed on other
    business activities (including commercial gambling.) There are two
    significant defects with this oblique suggestion; first, the
    legislation to impose taxation on Indian gambling passed the House of
    Representatives in the Fall of 1995 while my speech occurred in April
    of 1996, second, to date the commercial gambling industry has been
    unwilling to support such legislation, at least in part as a result of
    the fact that the commercial gambling industry provides substantial
    management and support services to the Indian-owned casinos.

                              subcommittee recess

        Senator Bennett. I have nothing further. Do you have
    anything to add?
        Mr. Archer. I would only add one other thing. We rotate
    chairmanships of this committee every year, and one year it is
    the House Ways and Means chairman, the next year it is the
    Senate Finance Committee chairman, and next year Senator Roth
    is the chairman of the Joint Committee on Taxation. Next year
    he will be the chairman, at the time when these appropriations
    will be going into effect.
        Senator Bennett. All right. Thank you very much. We
    appreciate your coming over.
        Mr. Archer. Thank you, Mr. Chairman.
        Senator Bennett. The subcommittee is recessed.
        [Whereupon, at 11:45 a.m., Tuesday, May 6, the subcommittee
    was recessed, to reconvene subject to the call of the Chair.]

             LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1998

                                  ----------

                             TUESDAY, MAY 20, 1997

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room S-128, the
    Capitol, Hon. Robert F. Bennett (chairman) presiding.
        Present: Senators Bennett, Stevens, Craig, and Dorgan.

                              CAPITOL POLICE BOARD

    STATEMENTS OF:
            HON. GREGORY S. CASEY, CHAIRMAN, U.S. CAPITOL POLICE BOARD
            HON. WILSON LIVINGOOD, SERGEANT AT ARMS, U.S. HOUSE OF
                REPRESENTATIVES, MEMBER, U.S. CAPITOL POLICE BOARD
            CHIEF GARY L. ABRECHT, U.S. CAPITOL POLICE
    ACCOMPANIED BY HON. ALAN M. HANTMAN, ARCHITECT OF THE CAPITOL, MEMBER,
                U.S. CAPITOL POLICE BOARD

                     OPENING STATEMENT OF ROBERT F. BENNETT

        Senator Bennett. The subcommittee will come to order.
        Today we're holding a hearing on the budget for the U.S.
    Capitol Police Board and the Congressional Budget Office budget
    request. We appreciate you being here and look forward to your
    testimony.
        The first panel will be the Capitol Police Board, including
    the Honorable Greg Casey, who is the Senate Sergeant at Arms
    and chairman, the Honorable Wilson Livingood, the House
    Sergeant at Arms, and Mr. Gary Abrecht, Chief of the Capitol
    Police. I assume you are honorable as well, sir.
        Mr. Abrecht. I do not know, sir. [Laughter.]
        Senator Bennett. And we have accompanying them the
    Honorable Alan Hantman, Architect of the Capitol, who serves as
    a member of the Police Board. We will start with this first
    panel and go on to the second one after you have concluded.
        I want to commend the board, particularly you, Mr. Casey,
    for the effort being made to review the financial management
    and human resource practices of the police. My memory goes all
    the way back to the time when the Capitol Police were referred
    to affectionately as the campus cops.
        Every Senator had patronage, and the Capitol was filled
    with students at George Washington University who were getting
    their law degrees at night while sitting behind desks around
    the Capitol wearing uniforms during the daytime. One of them,
    who is now one of the more prominent attorneys in Salt Lake
    City, said if anything had ever happened that would have
    required him to draw his gun he would have been more panicked
    than the individual against whom he was drawing it, because he
    had not the slightest idea how to use it, or even what certain
    buttons on it were for.
        The Capitol Police unfortunately have had to acquire a
    professionalism far beyond that level, and we are sorry in a
    sense that is the case, but we recognize the professionalism of
    the police and commend you for that.
        So we have been joined by Senator Craig. Do you have an
    opening statement?
        Senator Craig. No, Mr. Chairman. Go right ahead. I will
    have some questions.
        Senator Bennett. Well, we shall hear from you, then, Mr.
    Casey.

                               summary statement

        Mr. Casey. Thank you, Mr. Chairman, and I want to also
    thank Wilson Livingood and Chief Abrecht and Mr. Hantman for
    being here today. These two fine gentlemen plus the police
    chief make up the team that makes up the Police Board. It's a
    great team to work with.
        I am honored to be chairman of the Capitol Police Board. I
    am honored to be able to represent the 1,250 members of the
    Capitol Police in making this request for our 1998
    appropriations. Thank you also for your kind remarks.
        I am reminded of the fact that one of my mentors in Idaho
    politics was a former Governor of Idaho who himself served,
    while he was attending George Washington University, as a
    Capitol Hill policeman. The stories you just told, I have heard
    before from Governor Smiley when he served on the Capitol
    Police many years ago.
        You are also correct in recognizing that this is a
    department that is in transition, reminding you--I do not think
    I need to, but this is the agency with the sole statutory
    responsibility for providing law enforcement and protective
    services for the entire branch of Government, legislative
    branch of Government.
        Because of that, we have the responsibility to try to
    increase our capabilities in what has become a varied and ever-
    present security threat situation.
        Thanks to the support of this committee, the Capitol Police
    has become a top-flight law enforcement operation, with
    enhanced capabilities and professional respect both within this
    community and outside this community.
        One example of the increased capabilities of the force is
    the creation of the physical security division. This division,
    which I might add was created subsequent to a Secret Service
    joint operation to analyze the physical security needs of the
    Capitol complex, was created in 1996. It has been charged with
    the development and implementation of an integrated security
    program for the entire Capitol complex.
        With the approval of this committee just recently, phase 1
    of this comprehensive state-of-the-art program has begun, and I
    might also add that we hope to finish phase 1 of our Capitol
    security program by the end of this calendar year, so the
    record of being able to put together the physical security
    division in 1996, develop and implement phase 1 by the end of
    this calendar year I think is fairly remarkable, and speaks
    highly of the effort of the Capitol Police.
        We have also become a full partner in the intelligence and
    national security community of the Federal Government,
    something which I think will become increasingly important.
        Because of these responsibilities, it falls to those of us
    who constitute the board to ensure that progress continues. The
    Capitol Police must remain responsive to the changing security
    requirements of Congress.
        In discharging this responsibility, we feel the need and
    obligation to serve both the department, its men and women, and
    the Congress. To the men and women of the department, the board
    must ensure that pay and benefits are commensurate with the
    duties we ask these personnel to perform for us on a daily
    basis. We must ensure that parity is maintained with other
    similar Federal law enforcement agencies in the Washington
    metropolitan area, and that the police command and management
    are effective and competent.
        To the Congress, the board must ensure that our budget
    request is reasonable, reflecting only the real needs of the
    department while ensuring our appropriated funds are managed
    responsibly and efficiently, something I am sure you will ask
    me questions about.
        I can assure you, Mr. Chairman and Senator Craig, that all
    of these factors were considered during the preparation of the
    fiscal year 1998 U.S. Capitol Police Board's budget request.
    The total request for 1998 is $79,336,000. This reflects a 9-
    percent increase over last year, or a $7.1 million increase.
        The increase reflects basically two areas. One is parity
    initiatives for these sworn officers to include about $2
    million in COLA only, and one-third of it, roughly 30 percent,
    is increases in the general expenses to cover computer and
    telecommunications systems which are now showing as part of the
    Sergeant at Arms' budget. Basically what we are doing is moving
    an expense that is for the Capitol Police, out of the Sergeant
    at Arms' budget and into the police budget, where it should
    have been all along. It is not new money. It has just been
    shifted over.
        Senator Bennett. May I interrupt you long enough to ask if
    you know if the Sergeant at Arms' budget is going down
    commensurately?
        Mr. Casey. I cannot guarantee that at this point, Mr.
    Chairman. The Sergeant at Arms' organization is in a state of
    total reorganization at this point. We will probably come back
    to you with a net reduction in the amount of O&M that we're
    requesting for 1998 over the budget that you've already
    received in the Sergeant at Arms operations. Whether that can
    be directly attributable to the shift of this money, I cannot
    say honestly.
        Senator Bennett. Continue.
        Mr. Casey. To ensure that we build on the operational
    successes of the Capitol Police, the board and the department's
    command staff recognize that our focus for the coming year must
    be on administrative and management issues. In response, this
    board passed a resolution which directs the department to
    conduct an evaluation of administrative and management
    functions within the Capitol Police force.
        This evaluation will include analysis and assessment of
    information technology, financial management, and human
    resource programs. We know that certain improvements,
    especially in information technology, are needed to improve and
    maintain the operational successes of the force. I will just
    outline in a moment what that evaluation process is going to
    be.
        First, we are going to conduct a thorough analysis of our
    current administrative operations and practices and establish
    some benchmarks. Second, we are going to define our
    requirements and our priorities; and third, once our functional
    requirements are defined, we will develop and implement
    programs to meet those needs and apply best business practices.
        This action is a proactive and responsible approach to
    making certain that the police command, the Police Board, and
    the respective appropriations and oversight committees have
    sound information on which to base their decisions.
        The mission of the U.S. Capitol Police is critical to the
    safety and security of the U.S. Congress and all those who work
    and visit here. We are presented with a complex and challenging
    task. It is our mutual goal to ensure that the U.S. Capitol
    Police continues to receive the funding it requires to
    effectively perform its mission.
        Just to elaborate on that statement, we are told repeatedly
    that this building, if not the top, is one of the top terrorism
    targets in the Nation, so we make a choice day-in and day-out
    as to whether or not we will make it a fortress, like some
    buildings in this town, or whether or not we will continue to
    have access by the public and the many visitors who come here.
        In order to do that, we have to continue to improve and
    keep our Capitol Police force responsive to that environment in
    which we find ourselves. That is a very difficult and demanding
    task. I think our police force has risen to that. That is one
    of the reasons I think when the chief talks, you will see that
    some of our statistics are things to be proud of, but it is
    indeed a daunting task and one we have to continue to stay on
    top of.
        We are convinced the administrative management aspect of
    this needs to be evaluated, as well as the physical security
    part of it, and we set about doing that in this calendar year.
        I would like to thank this committee for the support and
    guidance you have provided us, and I also want to thank you,
    Mr. Chairman, for the excellent working relationship we have
    had with your staff and with the Appropriations Committee. It
    has indeed been a partnership with them, and we think that has
    been very beneficial to both of us.

                               prepared statement

        A detailed budget of the U.S. Capitol Police has been
    submitted to the committee, and I will be happy to answer
    questions either now or after the other gentlemen.
        [The statement follows:]
                     Prepared Statement of Gregory S. Casey
        Mr. Chairman and members of the Committee, I am Greg Casey, I am
    the 34th Sergeant at Arms and Doorkeeper of the United States Senate.
    As such, I also serve this year as chairman of the Capitol Police
    Board. On behalf of the 1,250 men and women of Capitol Police, I am
    pleased to present the fiscal year 1998 Budget Request for the United
    States Capitol Police.
        Joining me today are the other two members of the Capitol Police
    Board, Mr. Wilson Livingood, the House Sergeant at Arms, and Mr. Alan
    Hantman, the Architect of the Capitol. I would like to thank each of
    them for their commitment and effort on behalf of the Board and
    Department. In particular, Mr. Livingood for his depth of experience
    and guidance in law enforcement operations and Mr. Hantman, not only
    for his work as a member of the Board, but also his support as
    Architect in providing facilities support, including infrastructure and
    capital improvements which are included in the Architects budget
    request. Also with us today is Gary Abrecht, the Chief of Police. Our
    appreciation to him for his leadership of the department.
        Over the past few years, the U.S. Capitol Police has been a
    Department in transition. As the agency with the sole statutory
    responsibility for providing law enforcement and protective services
    for the United States Congress, the Capitol Police must constantly
    strive to meet security threats which are varied and ever present.
        With the support of this committee, the U.S. Capitol Police force
    has become a top flight law enforcement operation with enhanced
    capabilities and professional respect both from within and outside the
    force. One example of the increased capabilities of the force is the
    creation of the Physical Security Division. This division is charged
    with the development and implementation of an integrated security
    program for the entire Capitol Complex. With the approval of this
    committee, phase one of this comprehensive, state-of-the-art program
    has begun. The U.S. Capitol Police has also established itself as a
    partner within the intelligence and national security community of the
    federal government.
        It falls to the Board of the U.S. Capitol Police to ensure that
    this progress continues and the Capitol Police remain responsive to the
    changing security requirements of the Congress. In discharging this
    responsibility, the Board assumes an obligation to both the Department
    and to the Congress.
        To the men and women of the Department, the Board must ensure that
    pay and benefits are commensurate with the duties the personnel are
    asked to perform; that parity is maintained with other similar federal
    law enforcement agencies in the Washington Metropolitan area; and that
    police command and management are effective and competent. To the
    Congress, the Board must ensure that our budget request is reasonable,
    reflecting only the real needs of the Department, while ensuring
    appropriated funds are managed responsibly and efficiently.
        All of these factors were considered during the preparation of the
    fiscal year 1998 U.S. Capitol Police Budget Request. The total fiscal
    year 1998 Budget Request for the United States Capitol Police is
    $79,336,000. This reflects an increase of 9 percent over last year's
    appropriation and an increase of 3 FTE's.
        The increase reflects actions in basically two areas. It funds pay
    parity initiatives for the sworn members of the force. It also
    increases the General Expenses Budget to cover computer and
    telecommunication systems expenses which were previously funded within
    the budget of the Office of the Senate Sergeant at Arms.
        To ensure that we continue to build upon the operational successes
    of the U.S. Capitol Police, the Board and the Department's Command
    Staff recognize that our focus for the coming year must be on
    administrative and management issues.
        In response, the Capitol Police Board passed a resolution which
    directs the department to conduct an evaluation of the administrative
    and management functions within the Capitol Police force. This
    evaluation will include analysis and assessment of information
    technology, financial management, and human resource programs.
        We know that certain improvements, especially in the information
    technology area, are needed to improve and maintain the operational
    successes of the force.
        If I may take a moment to outline the evaluation process:
      --We will first conduct an analysis of current administrative
            operations to establish benchmarks.
      --We will begin to define our requirements and priorities.
      --Once our functional requirements are defined, we will develop and
            implement programs to meet the identified needs and apply best
            business practices in each of the administrative operations.
        This action is a proactive and responsible approach in making
    certain that the police command, the Police Board, the respective
    appropriations and oversight committees have sound business information
    in order to make sound business decisions.
        The mission of the U.S. Capitol Police is critical to the safety
    and security of the United States Congress and all those who work and
    visit within the Capitol complex. We are presented with a complex and
    challenging task. It is our mutual goal to ensure that the U.S. Capitol
    Police continues to receive the funding it requires to effectively
    perform its mission.
        I would like to thank the Committee for the support and guidance
    you have provided to the Board over the last year. A detailed budget
    for the U.S. Capitol Police has been submitted to the Committee. I will
    be happy to answer any questions you may have.
                                     ______

          United States Capitol Police Fiscal Year 1998 Budget Request
                                combined budget
    Fiscal year 1997 Appropriation..........................     $72,138,000
    Fiscal year 1998 Appropriation Request..................      79,336,000
    Fiscal 1998 Increase....................................       7,198,000

        The budget for the United States Capitol Police is comprised of
    funding for the salaries of officers, members and employees and a
    general expenses account for administrative and capital asset
    requirements. The total estimate for fiscal year 1998 is $79,336,000.
    This is an increase of $7,198,000 over amounts appropriated in fiscal
    year 1997.
        Funding is requested for COLA and Comparability Pay, and three new
    positions. Two of these positions are for support of internal
    personnel/payroll functions which will be administered through the
    National Finance Center. The other new position is requested for
    support of the Office of General Counsel in meeting the requirements of
    the Congressional Accountability Act.
        The amount of $2,382,000 is requested to fund several pay
    initiatives for sworn personnel. It has been a long-standing objective
    of the Capitol Police Board and the Chief of Police to achieve parity
    in terms of pay and other benefits with other similarly situated
    Federal law enforcement agencies which are covered under Title 5 of the
    United States Code. The amount requested would allow the Department to
    administer the provisions of the Fair Labor Standard Act consistent
    with other agencies that allow the inclusion of scheduled leave for
    purposes of meeting pay period thresholds. Funding would also allow the
    Department to pay sworn personnel differential pay rates for Sundays,
    nights and holidays.
        The total request for the General Expenses budget is $5,401,000.
    Included in the General Expenses budget is the amount of $2,167,000 for
    computer services and telecommunications systems. The budget for these
    functions is included at the direction of the Senate Subcommittee on
    the Legislative Branch and represents a transfer of budget authority
    from the Office of the Senate Sergeant at Arms budget.
        Funds are also requested in the amount of $100,000 to fund a cross-
    servicing contract for the Accounting function related to our General
    Expenses appropriation as well as to upgrade or acquire necessary
    systems. Funding for the biennial promotion exam is included in the
    amount of $175,000. The amount of $98,000 is requested for restoration
    of the vehicle replacement budget which was reduced in fiscal year
    1997.
        The following is an explanation of changes contained in the
    Salaries and General Expenses budget estimates.
                                salaries budget
    Fiscal 1997.............................................     $69,356,000
    Fiscal 1998.............................................      73,935,000
    Increase................................................       4,579,000

    Mandatory Pay and Related Changes--$4,367,000
        Personnel Compensation--($261,000). A decrease is estimated due to
    the timing of scheduled classes at the Federal Law Enforcement Training
    Center.
        Agency Contributions for Employee Benefits--$462,000.
        Annualization of fiscal year 1997 COLA--$316,000. This amount is
    included at the COLA rate of 2.3 percent for three months for the COLA
    increase effective on January 1, 1997.
        Projected fiscal year 1998 COLA--$1,201,000. Estimated at the rate
    of 2.8 percent for nine months.
        Comparability Pay--$267,000. Estimated at the rate of .7 percent
    for nine months.
                Pay Schedule Parity Initiatives.
        Scheduled Leave Inclusion--$676,000.--Funding of this initiative
    would allow the department to administer provisions of the Fair Labor
    Standard Act in the same manner as other Federal law enforcement
    agencies. Sworn officers would be allowed to count scheduled leave
    toward meeting pay period thresholds for purposes of earning overtime.
        Differential Pay Rates.--Funding for the following differential pay
    rates is requested for sworn officers of the department consistent with
    rates paid under Title 5 of the United States Code for other Federal
    law enforcement agencies:
      --Sunday Pay--$521,000. This amount would be paid to sworn officers
            working Sunday at a differential rate of 25 percent.
      --Night Differential--$783,000. This differential pay would be
            administered at a rate of 10 percent.
      --Holiday Pay--$402,000. This amount is requested to fund a holiday
            pay differential of 100 percent.
    Program Type Changes--Workload--$212,000
        New Positions--$212,000. Amount of compensation and related
    benefits to fund three new positions: Two positions are requested to
    staff internal personnel/payroll functions in support of the National
    Finance Center payroll operation. The other position would be assigned
    to the Office of General Counsel in support of administering the
    Congressional Accountability Act.
                            general expenses budget
    Fiscal 1997.............................................      $2,782,000
    Fiscal 1998.............................................       5,401,000
    Increase................................................       2,619,000

        The General Expenses Budget request for fiscal year 1998 is
    $5,401,000. This amount includes a transfer of computer services and
    telecommunications systems from the Office of the Senate Sergeant at
    Arms. The estimate to fund these functions is $2,167,000. It is
    expected that these funds will be used to reimburse the Office of the
    Senate Sergeant at Arms for the maintenance and upgrade of current
    systems.
        The following is an overview of the General Expenses budget by
    object class:

    Transportation of Persons

    Fiscal 1997.............................................        $250,000
    Fiscal 1998.............................................         275,000
    Increase................................................          25,000

        This object class includes airfare, car rental, mileage, tolls, per
    diem, and other expenses incidental to official travel by employees of
    the Department. These travel expenses are related to protective
    details, transporting employees to and from the Federal Law Enforcement
    Training Center (FLETC) for recruit and other specialized training, as
    well as other developmental training that is not held at FLETC or in
    the DC area. It also includes costs associated with other travel
    related to official business such as investigations, ceremonial
    functions, competitions, etc.

    Transportation of Things

    Fiscal 1997.............................................          $5,000
    Fiscal 1998.............................................           5,000
    Increase................................................................

        This object class includes freight costs incurred when parts,
    uniforms, or materials must be sent to another location (e.g., our
    liaison office at FLETC), when equipment is shipped to a repair
    facility, when items of evidence must be sent to another site for
    analysis or investigation, shipment of household goods for officers
    assigned to FLETC, etc. Funds contained in this object class cover any
    transportation costs except regular mail services and travel and per
    diem costs.

    Rent, Communications, and Utilities

    Fiscal 1997.............................................       $137,000
    Fiscal 1998.............................................         76,000
    Increase................................................        (61,000)

        This object class provides funds for the lease and rental of
    equipment and services such as law enforcement computer files,
    automated research services, and photocopying machines. It also
    includes funds for U.S. Postage, and commercial long distance telephone
    service. The estimated decrease reflects the recent level of costs for
    these functions.

    Other Services

    Fiscal 1997.............................................      $1,195,000
    Fiscal 1998.............................................       3,666,000
    Increase................................................       2,471,000

        This object class includes charges for commodities, whether
    acquired by formal contract or other form of purchase, that are
    ordinarily consumed or expended within one year after they are put into
    use. It contains items such as weapon parts, photographic supplies, K-9
    supplies, automotive maintenance supplies, electronic supplies, office
    supplies, publications, uniforms and accessories, ammunition and
    explosives, and other miscellaneous supplies.
        This object class includes all services not specifically covered by
    any other object class. It encompasses such things as repairs and
    alterations to equipment, maintenance contracts, tuition and
    registration fees for training programs, conferences, seminars, etc.,
    uniform alterations, and professional services such as recruit
    physicals, forensic services, stenographic services, veterinary care,
    psychological evaluations, employee assistance program. The request
    also includes continued funding for the NFC conversion of payroll which
    is expected to occur for the House payroll on March 30, 1997.
        The amount of $2,167,000 is requested for reimbursement to the
    Office of the Senate Sergeant at Arms for computer and
    telecommunications services. Funding is also requested for an
    initiative to have the Departmental accounting of the General Expenses
    appropriation performed via cross-servicing by another agency. The
    amount of $175,000 is included in this object class for the biennial
    promotion exam.

    Supplies and Materials

    Fiscal 1997.............................................        $938,000
    Fiscal 1998.............................................         996,000
    Increase................................................          58,000

        This object class includes charges for commodities, whether
    acquired by formal contract or other form of purchase, that are
    ordinarily consumed or expended within one year after they are put into
    use. It contains items such as weapon parts, photographic supplies, K-9
    supplies, automotive maintenance supplies, electronic supplies, office
    supplies, publications, uniforms and accessories, ammunition and
    explosives, and other miscellaneous supplies.

    Capital Assets

    Fiscal 1997.............................................        $257,000
    Fiscal 1998.............................................         383,000
    Increase................................................         126,000

        This object class provides for the purchase of equipment that has a
    normal life expectancy of a year or more after being put into use,
    without material impairment of its physical condition, and has a unit
    cost of at least one hundred dollars. Included in this object class are
    weapons, vehicles, photographic equipment, automotive maintenance
    equipment, electronic equipment, investigative equipment, etc. The
    increase includes $97,000 to restore the budget for vehicle
    replacements which was reduced in fiscal year 1997.

                                                      SCHEDULE 3--JOINT--BY APPROPRIATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fiscal year 1996 actual      Fiscal year 1997          Fiscal year 1998         Net change 1997/98
                                                     --------------------------         estimate                  estimate         -------------------------
                                                                               ----------------------------------------------------
                                                         Staff        Amount       Staff        Amount       Staff        Amount       Staff        Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Appropriation: U.S. Capitol Police:
        Salaries:
            House...................................          637      $34,213          637      $33,437          637      $35,507  ...........       $2,070
            Senate..................................          662       35,919          662       35,919          665       38,428            3        2,509
                                                     -------------------------------------------------------------------------------------------------------
              Subtotal..............................        1,299       70,132        1,299       69,356        1,302       73,935            3        4,579
        Rescission (Public Law 104-208).............  ...........        3,000  ...........  ...........  ...........  ...........  ...........  ...........
                                                     -------------------------------------------------------------------------------------------------------
          Total Salaries............................        1,299       67,132        1,299       69,356        1,302       73,935  ...........        4,579
                                                     =======================================================================================================
        General Expenses............................  ...........        2,560  ...........        2,782  ...........        5,401  ...........        2,619
                                                     =======================================================================================================
    Breakdown by Object Class:
        11 Personnel Compensation...................  ...........       54,314  ...........       56,378  ...........       60,456  ...........        4,078
        12 Personnel Benefits.......................  ...........       12,818  ...........       12,978  ...........       13,479  ...........          501
        21 Transportation of Persons................  ...........          250  ...........          250  ...........          275  ...........           25
        22 Transportation of Things.................  ...........            5  ...........            5  ...........            5  ...........  ...........
        23 Rent Comm., and Utilities................  ...........          137  ...........          137  ...........           76  ...........          -61
        25 Other Services...........................  ...........        1,070  ...........        1,195  ...........        3,666  ...........        2,471
        26 Supplies and Materials...................  ...........          938  ...........          938  ...........          996  ...........           58
        31 Capital Assets...........................  ...........          160  ...........          257  ...........          383  ...........          126
                                                     -------------------------------------------------------------------------------------------------------
          Total.....................................  ...........       69,692  ...........       72,138  ...........       79,336  ...........        7,198
    --------------------------------------------------------------------------------------------------------------------------------------------------------

                                      SCHEDULE B--JOINT--ANALYSIS OF CHANGE TO BUDGET BASE BY ORGANIZATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Mandatory pay and                               Program Type Changes                                Net total changes
                                         related costs   ---------------------------------------------------------------------------------------------------
                                     --------------------     Price level         Legislation          Workload           Equipment,
                                                                changes      ----------------------------------------    alterations,
                                                         --------------------                                            maintenance,
                                        Staff    Amount                                                                  repairs, etc.      Staff    Amount
                                                            Staff    Amount     Staff    Amount     Staff    Amount  --------------------
                                                                                                                        Staff    Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Object Class:
        11 Personnel Compensation...  ........    $3,905  ........  ........  ........  ........         3      $173  ........  ........  ........    $4,078
        12 Personnel Benefits.......  ........       462  ........  ........  ........  ........  ........        39  ........  ........  ........       501
        21 Transportation of Persons  ........  ........  ........  ........  ........  ........  ........        25  ........  ........  ........        25
        22 Transportation of Things.  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        23 Rent, Comm., and
         Utilities..................  ........  ........  ........  ........  ........  ........  ........       -61  ........  ........  ........       -61
        25 Other Services...........  ........  ........  ........  ........  ........  ........  ........     2,371  ........      $100  ........     2,471
        26 Supplies and Materials...  ........  ........  ........       $58  ........  ........  ........  ........  ........  ........  ........        58
        31 Equipment................  ........  ........  ........  ........  ........  ........  ........  ........  ........       126  ........       126
                                     -----------------------------------------------------------------------------------------------------------------------
          Total.....................  ........     4,367  ........        58  ........  ........         3     2,547  ........       226  ........     7,198
    --------------------------------------------------------------------------------------------------------------------------------------------------------

         SCHEDULE C--JOINT--DETAILED ANALYSIS OF CHANGE BY ORGANIZATION
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                   Calculation of Base
                                            --------------------------------
                                                  Staff           Amount
    ------------------------------------------------------------------------
    Appropriation, 1997....................           1,299         $69,356
    Budget Base, 1997......................           1,299          69,356
                                            --------------------------------
              Adjustments to Base
    (1)1998 Request
                                            --------------------------------
    Mandatory Pay and Related Costs:
        Federal Employees Retirement System
         (FERS), CSRS and Health Benefits..  ..............             462
        Projected fiscal year 1998 COLA....  ..............           1,201
        Annualization of fiscal year 1997
         COLA..............................  ..............             316
        1998 Comparability Pay Increase....  ..............             267
        Capitol Police Board Pay
         Initiative:
            Scheduled Leave Toward
             Threshold.....................  ..............             676
            Night Differential.............  ..............             783
            Sunday Pay.....................  ..............             521
            Holiday Pay....................  ..............             402
        Estimated Lapse/FLETC Classes......  ..............            (261)
    Price Level Changes....................  ..............  ...............
    Program Type Changes...................  ..............  ...............
        Legislation........................  ..............  ...............
        Workload: Personnel Compensation
         and Benefits......................               3             212
        Equipment..........................  ..............  ...............
    Net Increase/Decrease Requested........               3           4,579
                                            --------------------------------
          Total Appropriation Request, 1998  ..............          73,935
    ------------------------------------------------------------------------

     SCHEDULE D--JOINT (SALARIES)--SUMMARY OF AGENCY FISCAL YEAR 1998 BUDGET
                                     REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................           1,299     \1\ $69,356
    Budget Base, 1997.......................           1,299      \1\ 69,356
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............           4,367
        Price Level Changes.................  ..............  ..............
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................               3             212
            Equipment.......................  ..............  ..............
                                             -------------------------------
              Total Proposed Changes........               3           4,579
                                             ===============================
              Fiscal year 1998 Budget
               Request......................  ..............          73,935
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $4,000,000 and employee
      benefits at approximately $13,479,000.

     explanation of change--fiscal year 1998 to accompany schedule d--house
                              adjustments to base
    Mandatory Pay and Related Costs--$2,070,000
        Retirement System and Health Benefits--$174,000. The increase is
    requested commensurate with other increases in personnel compensation.
        Projected fiscal year 1998 COLA--$576,000. The projected COLA is
    2.8 percent for nine months (2.1 percent).
        Annualization of the fiscal year 1997 COLA--$153,000. This amount
    is estimated on the basis of 2.3 percent for three months.
        Fiscal year 1997 Comparability Pay Increase--$126,000. This
    increase is requested to provide USCP officers with a comparability
    increase similar to that received by other Federal law enforcement
    officers. The projected increase is .7 percent for nine months (.53
    percent).
        Estimated Employment Lapse--($103,000). This amount is estimated to
    lapse due to the scheduling of FLETC classes and the vacancies that
    accrue prior to the hiring of classes.
        Scheduled Leave Inclusion--$325,000. This amount is requested to
    allow the Department to administer the FLSA in the same manner as other
    Federal law enforcement agencies by allowing scheduled leave to be
    counted toward meeting pay period thresholds for purposes of overtime.
        Differential Pay Rates:
      --Sunday Pay--$250,000. This amount would fund a differential rate of
            25 percent for officers that work on Sunday.
      --Night Differential--$376,000. This amount would provide for a night
            differential at rates between 7.5 and 10 percent.
      --Holiday Pay--$193,000. This amount is requested to fund a holiday
            pay differential of 100 percent.

    SCHEDULE D--JOINT (GENERAL EXPENSES)--SUMMARY OF AGENCY FISCAL YEAR 1998
                                 BUDGET REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............          $2,782
    Budget Base, 1997.......................  ..............           2,782
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............  ..............
        Price Level Changes.................  ..............              58
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................  ..............           2,335
            Equipment.......................  ..............             226
                                             -------------------------------
              Total Proposed Changes........  ..............           2,619
                                             ===============================
              Fiscal year 1998 Budget
               Request......................  ..............           5,401
    ------------------------------------------------------------------------

    SCHEDULE D1--HOUSE (SALARIES)--SUMMARY OF AGENCY FISCAL YEAR 1998 BUDGET
                                     REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............     \1\ $33,437
    Budget Base, 1997.......................  ..............      \1\ 33,437
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............           2,070
        Price Level Changes.................  ..............  ..............
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................  ..............  ..............
            Equipment.......................  ..............  ..............
                                             -------------------------------
              Total Proposed Changes........  ..............           2,070
                                             ===============================
              Fiscal year 1998 Budget
               Request......................  ..............          35,507
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $6,435,000.

       SCHEDULE D2--SENATE (SALARIES)--SUMMARY OF AGENCY FISCAL YEAR 1998
                                 BUDGET REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............     \1\ $35,919
    Budget Base, 1997.......................  ..............      \1\ 35,919
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............           2,297
        Price Level Changes.................  ..............  ..............
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................               3             212
            Equipment.......................  ..............  ..............
                                             -------------------------------
              Total Proposed Changes........               3           2,509
                                             ===============================
              Fiscal year 1998 Budget
               Request......................  ..............          38,428
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $7,044,000.

                             JOINT PERSONNEL SUMMARY
    ------------------------------------------------------------------------
                                                1996       1997       1998
                                               Actual    Estimate   Estimate
    ------------------------------------------------------------------------
    Chief..................................          1          1          1
    Assistant Chief........................          1          1          1
    Deputy Chief...........................          3          3          3
    Inspector..............................          8          8          8
    Captain................................         15         15         15
    Lieutenant.............................         37         37         37
    Sergeant/Special Tech..................        148        148        148
    Detective..............................         47         47         47
    Technician/K-9.........................         50         50         50
    Officer................................        783        783        783
    Non-Sworn Personnel....................        206        206        209
                                            ================================
    Average salary/FTE \1\.................    $40,285    $41,615    $42,863
    Number of FTE's........................      1,226      1,256      1,259
    Number of FTE's authorized.............      1,299      1,299      1,302
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $4,000,000 and employee
      benefits at approximately $13,479,000.

                                                      SCHEDULE A--HOUSE--BY APPROPRIATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fiscal year 1996 actual      Fiscal year 1997          Fiscal year 1998         Net change 1997/98
                                                     --------------------------         estimate                  estimate         -------------------------
                                                                               ----------------------------------------------------
                                                         Staff        Amount       Staff        Amount       Staff        Amount       Staff        Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Appropriation: U.S. Capitol Police:
        Salaries:
            House...................................          637      $34,213          637      $33,437          637      $35,507  ...........       $2,070
            Rescission (Public Law 104-208).........  ...........        2,200  ...........  ...........  ...........  ...........  ...........  ...........
                                                     -------------------------------------------------------------------------------------------------------
              Subtotal..............................          637       32,013          637       33,437          637       35,507  ...........        2,070
                                                     =======================================================================================================
        General Expenses............................  ...........        2,560  ...........        2,782  ...........        5,401  ...........        2,619
                                                     =======================================================================================================
    Breakdown by Object Class:
        11 Personnel Compensation...................  ...........       25,959  ...........       27,176  ...........       29,072  ...........        1,896
        12 Personnel Benefits.......................  ...........        6,079  ...........        6,261  ...........        6,435  ...........          174
                                                     -------------------------------------------------------------------------------------------------------
          Total.....................................  ...........       32,038  ...........       33,437  ...........       35,507  ...........        2,070
    --------------------------------------------------------------------------------------------------------------------------------------------------------

                                      SCHEDULE B--HOUSE--ANALYSIS OF CHANGE TO BUDGET BASE BY ORGANIZATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Mandatory pay and                               Program Type Changes                                Net total changes
                                         related costs   ---------------------------------------------------------------------------------------------------
                                     --------------------     Price level         Legislation          Workload           Equipment,
                                                                changes      ----------------------------------------    alterations,
                                                         --------------------                                            maintenance,
                                        Staff    Amount                                                                  repairs, etc.      Staff    Amount
                                                            Staff    Amount     Staff    Amount     Staff    Amount  --------------------
                                                                                                                        Staff    Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Object Class:
        11 Personnel Compensation...  ........    $1,896  ........  ........  ........  ........  ........  ........  ........  ........  ........    $1,896
        12 Personnel Benefits.......  ........       174  ........  ........  ........  ........  ........  ........  ........  ........  ........       174
        21 Transportation of Persons  ........  ........  ........  ........  ........  ........  ........       $25  ........  ........  ........        25
        22 Transportation of Things.  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        23 Rent, Comm., and
         Utilities..................  ........  ........  ........  ........  ........  ........  ........       -61  ........  ........  ........       -61
        25 Other Services...........  ........  ........  ........  ........  ........  ........  ........     2,371  ........      $100  ........     2,471
        26 Supplies and Materials...  ........  ........  ........  ........  ........  ........  ........        58  ........  ........  ........        58
        31 Equipment................  ........  ........  ........  ........  ........  ........  ........  ........  ........       126  ........       126
                                     -----------------------------------------------------------------------------------------------------------------------
          Total.....................  ........     2,070  ........  ........  ........  ........  ........     2,393  ........       226  ........     4,689
    --------------------------------------------------------------------------------------------------------------------------------------------------------

         SCHEDULE C--HOUSE--DETAILED ANALYSIS OF CHANGE BY ORGANIZATION
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                   Calculation of Base
                                            --------------------------------
                                                  Staff           Amount
    ------------------------------------------------------------------------
    Appropriation, 1997....................             637         $33,437
    Budget Base, 1997......................             637          33,437
                                            --------------------------------
              Adjustments to Base
    (1)1998 Request
                                            --------------------------------
    Mandatory Pay and Related Costs:
        Federal Employees Retirement System
         (FERS), CSRS and Health Benefits..  ..............             174
        Projected fiscal year 1998 COLA....  ..............             576
        Annualization of fiscal year 1997
         COLA..............................  ..............             153
        1998 Comparability Pay Increase....  ..............             126
        Capitol Police Board Pay
         Initiative:
            Scheduled Leave Toward
             Threshold.....................  ..............             325
            Night Differential.............  ..............             376
            Sunday Pay.....................  ..............             250
            Holiday Pay....................  ..............             193
        Estimated Lapse/FLETC Classes......  ..............            (103)
    Price Level Changes....................  ..............  ...............
        Program Type Changes:
            Legislation....................  ..............  ...............
            Workload: Personnel
             Compensation and Benefits.....  ..............  ...............
            Equipment......................  ..............  ...............
    Net Increase/Decrease Requested........  ..............           2,070
                                            --------------------------------
          Total Appropriation Request, 1998  ..............          35,507
    ------------------------------------------------------------------------

    SCHEDULE D1--HOUSE (SALARIES)--SUMMARY OF AGENCY FISCAL YEAR 1998 BUDGET
                                     REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............     \1\ $33,437
    Budget Base, 1997.......................  ..............      \1\ 33,437
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............           2,070
        Price Level Changes.................  ..............  ..............
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................  ..............  ..............
            Equipment.......................  ..............  ..............
                                             -------------------------------
              Total Proposed Changes........  ..............           2,070
                                             -------------------------------
              Fiscal year 1998 Budget
               Request......................  ..............          35,507
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $6,435,000.

                             HOUSE PERSONNEL SUMMARY
    ------------------------------------------------------------------------
                                                1996       1997       1998
                                               Actual    Estimate   Estimate
    ------------------------------------------------------------------------
    Chief..................................          1          1          1
    Assistant Chief........................  .........  .........  .........
    Deputy Chief...........................          2          2          2
    Inspector..............................          4          4          4
    Captain................................          8          8          8
    Lieutenant.............................         20         20         20
    Sergeant/Special Tech..................         81         81         81
    Detective..............................         21         21         21
    Technician/K-9.........................         23         23         23
    Officer................................        353        353        353
    Non-Sworn Personnel....................        124        124        124
                                            ================================
    Average salary/FTE \1\.................    $40,608    $41,948    $43,206
    Number of FTE's........................        584        600        601
    Number of FTE's authorized.............        637        637        637
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $6,435,000.

                                                SCHEDULE A--SENATE (SALARIES)--BY APPROPRIATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fiscal year 1996 actual      Fiscal year 1997          Fiscal year 1998         Net change 1997/98
                                                     --------------------------         estimate                  estimate         -------------------------
                                                                               ----------------------------------------------------
                                                         Staff        Amount       Staff        Amount       Staff        Amount       Staff        Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Appropriation: U.S. Capitol Police:
        Salaries:
            Senate..................................  ...........      $35,919  ...........      $35,919  ...........      $38,428  ...........       $2,509
            Rescission (Public Law 104-208).........  ...........          800  ...........  ...........  ...........  ...........  ...........  ...........
                                                     -------------------------------------------------------------------------------------------------------
              Subtotal..............................  ...........       35,119  ...........       35,919  ...........       38,428  ...........        2,509
                                                     =======================================================================================================
    Breakdown by Object Class:
        11 Personnel Compensation...................  ...........       28,355  ...........       29,202  ...........   \1\ 31,384  ...........        2,182
        12 Personnel Benefits.......................  ...........        6,739  ...........        6,717  ...........        7,044  ...........          327
                                                     -------------------------------------------------------------------------------------------------------
          Total.....................................  ...........       35,094  ...........       35,919  ...........       38,428  ...........        2,509
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Personnel Compensation in fiscal year 1998 reflects overtime estimate of $2,000,000.

                                     SCHEDULE B--SENATE--ANALYSIS OF CHANGE TO BUDGET BASE BY ORGANIZATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Mandatory pay and                               Program Type Changes                                Net total changes
                                         related costs   ---------------------------------------------------------------------------------------------------
                                     --------------------     Price level         Legislation          Workload           Equipment,
                                                                changes      ----------------------------------------    alterations,
                                                         --------------------                                            maintenance,
                                        Staff    Amount                                                                  repairs, etc.      Staff    Amount
                                                            Staff    Amount     Staff    Amount     Staff    Amount  --------------------
                                                                                                                        Staff    Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Object Class:
        11 Personnel Compensation...  ........    $2,009  ........  ........  ........  ........         3      $173  ........  ........  ........    $2,182
        12 Personnel Benefits.......  ........       288  ........  ........  ........  ........  ........        39  ........  ........  ........       327
        21 Transportation of Persons  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        22 Transportation of Things.  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        23 Rent, Comm., and
         Utilities..................  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        25 Other Services...........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        26 Supplies and Materials...  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        31 Equipment................  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
                                     -----------------------------------------------------------------------------------------------------------------------
          Total.....................  ........     2,297  ........  ........  ........  ........         3       212  ........  ........  ........     2,509
    --------------------------------------------------------------------------------------------------------------------------------------------------------

         SCHEDULE C--SENATE--DETAILED ANALYSIS OF CHANGE BY ORGANIZATION
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                   Calculation of Base
                                            --------------------------------
                                                  Staff           Amount
    ------------------------------------------------------------------------
    Appropriation, 1997....................             662         $35,919
    Budget Base, 1997......................             662          35,919
                                            --------------------------------
              Adjustments to Base
    (1)1998 Request
                                            --------------------------------
    Mandatory Pay and Related Costs:
        Federal Employees Retirement System
         (FERS), CSRS and Health Benefits..  ..............             288
        Projected fiscal year 1998 COLA....  ..............             625
        Annualization of fiscal year 1997
         COLA..............................  ..............             163
        1998 Comparability Pay Increase....  ..............             141
        Capitol Police Board Pay
         Initiative:
            Scheduled Leave Toward
             Threshold.....................  ..............             351
            Night Differential.............  ..............             407
            Sunday Pay.....................  ..............             271
            Holiday Pay....................  ..............             209
        Estimated Lapse/FLETC Classes......  ..............            (158)
    Program Type Changes:
        Legislation........................  ..............  ...............
        Workload: Personnel Compensation
         and Benefits......................               3             212
        Equipment..........................  ..............  ...............
    Net Increase/Decrease Requested........  ..............           2,509
                                            --------------------------------
          Total Appropriation Request, 1998               3          38,428
    ------------------------------------------------------------------------

    explanation of change--fiscal year 1998 to accompany schedule d--senate
                              adjustments to base
    Mandatory Pay and Related Costs--$2,297,000
        Retirement System and Health Benefits--$288,000. The increase is
    requested commensurate with other increases in personnel compensation.
        Projected fiscal year 1998 COLA--$625,000. The projected COLA is
    2.8 percent for nine months (2.1 percent).
        Annualization of the fiscal year 1997 COLA--$163,000. This amount
    is estimated on the basis of 2.3 percent for three months.
        Fiscal year 1997 Comparability Pay Increase--$141,000. This
    increase is requested to provide USCP officers with a comparability
    increase similar to that received by other Federal law enforcement
    officers. The projected increase is .7 percent for nine months (.53
    percent).
        Estimated Employment Lapse--($158,000). This amount is estimated to
    lapse due to the scheduling of FLETC classes and the vacancies that
    accrue prior to the hiring of classes.
        Scheduled Leave Inclusion--$351,000. This amount is requested to
    allow the Department to administer the FLSA in the same manner as other
    Federal law enforcement agencies by allowing scheduled leave to be
    counted toward meeting pay period thresholds for purposes of overtime.
        Differential Pay Rates:
      --Sunday Pay--$271,000. This amount would fund a differential rate of
            25 percent for officers that work on Sunday.
      --Night Differential--$407,000. This amount would provide for a night
            differential at rates between 7.5 and 10 percent.
      --Holiday Pay--$209,000. This amount is requested to fund a holiday
            pay differential of 100 percent.
        Price Level Changes--$0.
        Program Type Changes:
        Workload--$212,000.
        New Positions--$212,000. Compensation and benefits to fund three
    new positions. Two positions are requested to staff internal payroll/
    personnel functions in support of the National Finance Center payroll
    operation. The third position is requested for assignment to the Office
    of General Counsel in support of administering the Congressional
    Accountability Act.

       SCHEDULE D2--SENATE (SALARIES)--SUMMARY OF AGENCY FISCAL YEAR 1998
                                 BUDGET REQUEST
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............     \1\ $35,919
    Budget Base, 1997.......................  ..............      \1\ 35,919
                                             ===============================
    Proposed Changes for fiscal year 1998:
        Mandatory Pay and Related Costs.....  ..............           2,297
        Price Level Changes.................  ..............  ..............
        Program Type Changes:
            Legislation.....................  ..............  ..............
            Workload........................               3             212
            Equipment.......................  ..............  ..............
                                             -------------------------------
              Total Proposed Changes........               3           2,509
                                             -------------------------------
              Fiscal year 1998 Budget
               Request......................  ..............          38,428
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $7,044,000.

                            SENATE PERSONNEL SUMMARY
    ------------------------------------------------------------------------
                                                1996       1997       1998
                                               Actual    Estimate   Estimate
    ------------------------------------------------------------------------
    Chief..................................  .........  .........  .........
    Assistant Chief........................          1          1          1
    Deputy Chief...........................          1          1          1
    Inspector..............................          4          4          4
    Captain................................          7          7          7
    Lieutenant.............................         17         17         17
    Sergeant/Special Tech..................         67         67         67
    Detective..............................         26         26         26
    Technician/K-9.........................         27         27         27
    Officer................................        430        430        430
    Non-Sworn Personnel....................         82         82         85
                                            ================================
    Average salary/FTE \1\.................    $40,135    $40,459    $42,703
    Number of FTE's........................        642        656        659
    Number of FTE's authorized.............        662        662        662
    ------------------------------------------------------------------------
    \1\ Includes overtime currently estimated at $2,000,000 and employee
      benefits at approximately $7,044,000.

                                             SCHEDULE 3--HOUSE (GENERAL EXPENSES)--BY APPROPRIATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fiscal year 1996 actual      Fiscal year 1997          Fiscal year 1998         Net change 1997/98
                                                     --------------------------         estimate                  estimate         -------------------------
                                                                               ----------------------------------------------------
                                                         Staff        Amount       Staff        Amount       Staff        Amount       Staff        Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Appropriation: U.S. Capitol Police:
        General Expenses............................  ...........       $2,560  ...........       $2,782  ...........       $5,401  ...........       $2,619
                                                     =======================================================================================================
    Breakdown by Object Class:
        11 Personnel Compensation...................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ...........
        12 Personnel Benefits.......................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ...........
        21 Transportation of Persons................  ...........          250  ...........          250  ...........          275  ...........           25
        22 Transportation of Things.................  ...........            5  ...........            5  ...........            5  ...........  ...........
        23 Rent Comm., and Utilities................  ...........          137  ...........          137  ...........           76  ...........          -61
        25 Other Services...........................  ...........        1,070  ...........        1,195  ...........        3,666  ...........        2,471
        26 Supplies and Materials...................  ...........          938  ...........          938  ...........          996  ...........           58
        31 Capital Assets...........................  ...........          160  ...........          257  ...........          383  ...........          126
                                                     -------------------------------------------------------------------------------------------------------
          Total.....................................  ...........        2,560  ...........        2,782  ...........        5,401  ...........        2,619
    --------------------------------------------------------------------------------------------------------------------------------------------------------

                            SCHEDULE B--HOUSE (GENERAL EXPENSES)--ANALYSIS OF CHANGE TO BUDGET BASE BY ORGANIZATION AND OBJECT CLASS
                                                                [Amounts in thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Mandatory pay and                               Program Type Changes                                Net total changes
                                         related costs   ---------------------------------------------------------------------------------------------------
                                     --------------------     Price level         Legislation          Workload           Equipment,
                                                                changes      ----------------------------------------    alterations,
                                                         --------------------                                            maintenance,
                                        Staff    Amount                                                                  repairs, etc.      Staff    Amount
                                                            Staff    Amount     Staff    Amount     Staff    Amount  --------------------
                                                                                                                        Staff    Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Breakdown by Object Class:
        11 Personnel Compensation...  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        12 Personnel Benefits.......  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        21 Transportation of Persons  ........  ........  ........  ........  ........  ........  ........       $25  ........  ........  ........       $25
        22 Transportation of Things.  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........  ........
        23 Rent, Comm., and
         Utilities..................  ........  ........  ........  ........  ........  ........  ........       -61  ........  ........  ........       -61
        25 Other Services...........  ........  ........  ........  ........  ........  ........  ........     2,371  ........      $100  ........     2,471
        26 Supplies and Materials...  ........  ........  ........       $58  ........  ........  ........  ........  ........  ........  ........        58
        31 Equipment................  ........  ........  ........  ........  ........  ........  ........  ........  ........       126  ........       126
                                     -----------------------------------------------------------------------------------------------------------------------
          Total.....................  ........  ........  ........        58  ........  ........  ........     2,335  ........       226  ........     2,619
    --------------------------------------------------------------------------------------------------------------------------------------------------------

      SCHEDULE C--HOUSE (GENERAL EXPENSES)--DETAILED ANALYSIS OF CHANGE BY
                                  ORGANIZATION
                        [Amounts in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Calculation of Base
                                             -------------------------------
                                                   Staff          Amount
    ------------------------------------------------------------------------
    Appropriation, 1997.....................  ..............          $2,782
    Budget Base.............................  ..............           2,782
                                             -------------------------------
               Adjustments to Base
    (1)1998 Request
                                             -------------------------------
    Mandatory Pay and Related Costs.........  ..............  ..............
    Price Level Changes: Supplies and
     Materials..............................  ..............              58
    Program Type Changes....................  ..............           2,561
        Workload:
            Transportation of Persons.......  ..............              25
            Rent, Comm., and Utilities......  ..............             -61
            Other Services..................  ..............           2,371
        Equipment, Alterations, Maintenance,
         Etc................................  ..............             226
    Net Increase Requested..................  ..............           2,619
                                             -------------------------------
          Total Appropriation Request, 1998.  ..............           5,401
    ------------------------------------------------------------------------

    Explanation of change--fiscal year 1998 to accompany Schedule C--General
    expenses

    Adjustments to Base:
        Mandatory Pay and Related Costs.....................................
        Price Level Changes.......................................  $58,000
            Supplies and Materials................................   58,000
        Program Type Changes......................................2,335,000
            Transportation of Persons.............................   25,000
            Rent, Comm., and Utilities............................  (61,000)
            Other Services........................................2,371,000
        Equipment, Alterations, Maintenance.......................  226,000
            Other Services........................................  100,000
            Equipment.............................................  126,000

                     summary statement of wilson livingood

        Senator Bennett. Let us go on.
        Mr. Livingood. Mr. Chairman, I am Bill Livingood, the House
    Sergeant at Arms, and Mr. Chairman, members of the committee,
    first of all it is an honor to appear before you and discuss
    the fiscal year 1998 budget request for the U.S. Capitol
    Police.
        I would like to join Mr. Casey in welcoming the new
    Architect, Alan Hantman, to the Capitol Police Board. During my
    tenure, which has been 2 years as Sergeant at Arms, I have
    found my service on the board to be both challenging, exciting,
    and rewarding. I know that Mr. Hantman will find this
    experience equally satisfying. The expertise he brings to the
    table I think will provide valuable insight on many board
    decisions.
        I would like to say there is a big change today. The world
    is changing, and the threat that the Capitol Police and the
    Capitol itself encounters, and the Members, is changing. With
    additional training that the Capitol Police has now been
    receiving and will receive additional other training, I feel
    that the Capitol Police is prepared today to meet this
    challenge.
        I would like to say I am really proud of what they have
    done and how they have met this challenge, because in the last
    4 or 5 years it is a different world today, and it is a
    different Capitol Police, and we feel that the Capitol Police
    Board's responsibility was to assure that they had the tools to
    meet this challenge.
        The U.S. Capitol Police is a unique law enforcement agency.
    It is charged with protecting 535 Members of Congress. It is
    charged with protection of their families, congressional staff,
    the visiting public, which has meant astronomical proportions
    this year, a large increase in visiting public, and the
    buildings, comprising the Capitol complex.
        To successfully meet its mission, the department has
    evolved into a full service security agency which also provides
    comprehensive law enforcement and protective operations to the
    legislative branch of Government. The U.S. Capitol Police also
    interacts on an equal basis with agencies that deal in national
    security and intelligence matters.
        Due to the leadership and support of this committee, and
    the dedication and hard work of our personnel, the U.S. Capitol
    Police has made great strides in its operational capabilities.
    The board feels it is now time to focus its efforts on the
    department's internal management mechanisms, as Mr. Casey
    mentioned. In particular, the board will commission review of
    the department's internal accounting, personnel, and
    information management functions to ensure that they are being
    performed in a manner which is consistent with industry
    standards.
        In addition, police post and staffing level study has been
    conducted to ensure that our personnel are deployed in a manner
    which is both operationally effective and fiscally efficient.
    It is hoped that overtime expenditures will be further reduced
    once the results of this study are instituted.
        With regard to personnel issues, it has been the
    longstanding goal of the U.S. Capitol Police Board to ensure
    that the men and women of the U.S. Capitol Police maintain pay
    parity with their counterparts in other law enforcement
    agencies. Therefore, the U.S. Capitol Police fiscal year 1998
    budget submission contains a request to fund two pay
    initiatives, scheduled leave inclusion and differential pay.
    These pay rates are consistent with rates paid for the officers
    of other similar law enforcement agencies. In order for the
    Capitol Police to attract and retain highly qualified officers,
    I feel it is imperative that these initiatives be fully funded.
        I would like to thank the committee for your support of the
    transfer of the physical security responsibilities from the
    Architect of the Capitol to the U.S. Capitol Police, and for
    providing funding for necessary security upgrades recommended
    in the U.S. Capitol Police/Secret Service study. This study
    provided the board with numerous recommendations on how to
    improve security within the Capitol complex.
        I also would like to thank the committee for your
    assistance in providing emergency funding to relocate the U.S.
    Capitol Police K-9 facility to the Architect's facility at Blue
    Plains. This has been a huge improvement. We look forward to
    occupying the former Metropolitan Police Department facility
    this summer, and urge the committee to approve the Architect's
    request to renovate that facility for the department's use.

                               prepared statement

        A detailed budget for the Capitol Police has been submitted
    to the committee, as Mr. Casey mentioned, and we will be happy
    to answer any questions.
        [The statement follows:]

                     Prepared Statement of Wilson Livingood

        Mr. Chairman and members of the Committee, as a member of
    the U.S. Capitol Police Board, it is my honor to appear before
    you to discuss the fiscal year 1998 Budget Request for the U.S.
    Capitol Police.
        I join Mr. Casey in welcoming Mr. Hantman to the U.S.
    Capitol Police Board. During my tenure as House Sergeant at
    Arms, I have found my service on the Board to be both
    challenging and rewarding. I know that Mr. Hantman will find
    the experience equally satisfying. The expertise he brings to
    the table will provide valuable insight on Board decisions.
        The United States Capitol Police is a unique law
    enforcement agency. It is charged with protecting the 535
    Members of Congress and their families, congressional staff,
    the visiting public, and the buildings comprising the Capitol
    complex. To successfully meet its mission, the Department has
    evolved into a full service security agency which also provides
    comprehensive law enforcement and protective operations to the
    Legislative Branch of government. The U.S. Capitol Police also
    interacts on an equal basis with agencies that deal in national
    security and intelligence matters.
        Due to the leadership and support of this Committee, and
    the dedication and hard work of our personnel, the U.S. Capitol
    Police has made great strides in its operational capabilities.
    The Board feels it is now time to focus its efforts on the
    Department's internal management mechanisms. In particular, the
    Board will commission a review of the Department's internal
    accounting, personnel, and information management functions to
    ensure they are being performed in a manner which is consistent
    with industry standards. In addition, a police post and
    staffing level study has been conducted to ensure that our
    personnel are deployed in a manner which is both operationally
    effective and fiscally efficient. It is hoped that overtime
    expenditures will be further reduced once the results of the
    study are instituted.
        With regard to personnel issues, it has been the long-
    standing goal of the U.S. Capitol Police Board to ensure that
    the men and women of the U.S. Capitol Police maintain pay
    parity with their counterparts in other law enforcement
    agencies. Therefore, the USCP fiscal year 1998 Budget
    submission contains a request to fund two pay initiatives;
    scheduled leave inclusion and differential pay. These pay rates
    are consistent with rates paid for the officers of other
    similar law enforcement agencies. In order for the U.S. Capitol
    Police to attract and retain highly-qualified officers, I feel
    it is imperative that these initiatives be fully funded.
        I would like to thank the Committee for your support of the
    transfer of the physical security responsibilities from the
    Architect of the Capitol to the U.S. Capitol Police and for
    providing funding for necessary security upgrades recommended
    in the U.S. Capitol Police/U.S. Secret Service study. This
    study provided the Board with numerous recommendations on how
    to improve security within the Capitol Complex.
        I also thank the Committee for your assistance in providing
    emergency funding to relocate the U.S. Capitol Police K-9
    facility to the Architect's facility at Blue Plains. We look
    forward to occupying the former Metropolitan Police facility
    this summer and urge the Committee to approve the Architect's
    request to renovate that facility for the Department's use.
        A detailed budget for the U.S. Capitol Police has been
    submitted to the Committee. I will be happy to answer any
    questions you may have.

                       summary statement of gary abrecht

        Senator Bennett. Thank you very much. Chief, are you next,
    or are you coasting on your statement? [Laughter.]
        Mr. Abrecht. I have a couple of issues I would like to
    address. Last year was a time of operational growth for the
    department due to the lessons learned from the sarin gas attack
    which occurred in the Tokyo subway system. We developed a whole
    chemical and biological response capability for the Capitol
    complex. This capability complements the exemplary explosive
    device detection and disposal ability that the department has
    maintained since 1971.
        In addition, as Mr. Casey mentioned, we have expanded our
    protective intelligence capability. We now routinely exchange
    information which impacts on the security of the Capitol
    complex and Congress with other national security and
    intelligence organizations. These increased operational and
    intelligence exchange capabilities have significantly enhanced
    our ability to deter, interdict, or respond to acts of violence
    directed against the Congress and those who work and visit in
    the Capitol complex.
        You will recall that last year I reported that threats
    against Members of Congress nearly doubled from the year
    before. I am pleased to report that cases this year have
    decreased from last year's peak, although the number of threat
    cases is still above the average for the previous year.
        Compared with the previous 12 month period, the
    department's threat assessment section has recorded a 33-
    percent decrease in direct threats against Members of Congress.
    Implied threats have also decreased, while direction of
    interest cases have significantly increased. We continue to
    diligently investigate each case that is brought to our
    attention, and work closely with other law enforcement agencies
    to successfully resolve those cases.
        The crime situation in the Washington area and in the city
    in particular has been of concern in recent months, so we have
    been particularly diligent in looking out for the safety of the
    public, Members, and the staff in our area of jurisdiction, and
    I am pleased to report that crimes against persons within the
    Capitol complex continue to decline.
        Last year, within our primary jurisdiction, crimes against
    persons dropped by 8 percent. This year, such crime decreased
    again by 33 percent, and there were only 16 reported incidents
    for the entire year of crimes against persons on the Capitol
    Grounds. This figure is remarkable, when one considers the
    millions of people who visited or traveled through the
    buildings, streets, and parks of the Capitol complex last year.
        Property crimes also decreased by 29 percent compared to
    the previous 12 month period. Unfortunately, in the area
    surrounding the Capitol complex which comprises the extended
    jurisdiction zone, 731 crimes against persons and 3,124
    property crimes were reported. I am fairly proud that our
    patrol and enforcement efforts deter this level of criminal
    activity from occurring within the Capitol complex itself.
        As both the Sergeants at Arms have mentioned, this year's
    budget request contains a pay initiative which is intended to
    assure that the salaries and benefits that Congress provides
    for the men and women of the U.S. Capitol Police remain
    comparable to those which are provided to their counterparts in
    other similar Federal law enforcement agencies.
        Aside from the issue of fairness, this initiative will
    ensure that the department will continue to improve and retain
    the highly qualified officers we need to effectively perform
    our mission.
        The issue of attracting the best possible officer
    candidates has become even more critical due to the
    increasingly complex and technical nature of our mission.
    Therefore, I urge the committee to support this request, and
    provide funding to institute these pay initiatives. I think
    both Mr. Casey and Mr. Livingood have mentioned the physical
    security initiative and the progress we are making on that, and
    I think I will coast, as you say, on their statement in that
    regard.
        They also both made mention of the fact that while our
    operational capabilities have increased--we reduced crime,
    increased training, and improved our response capabilities--
    that there is some work needed in our administrative
    operations.
        As Mr. Livingood mentioned, we have conducted an extensive
    review of every post, to include staffing levels and the hours
    each post is required to be staffed in order to determine if
    our personnel can be redeployed. The results are now being
    compiled and analyzed, and I expect to make some
    recommendations to the Capitol Police Board in June which, if
    they prove acceptable, could result in reduced police post
    staffing costs without affecting security.
        We are also reviewing staffing of our support and
    administrative positions to see if there are additional
    reductions that could be made there.
        The second initiative consists of a management review of
    our internal accounting and information management systems. The
    weakness of our administrative infrastructure were highlighted
    by the onset of the Congressional Accountability Act. As an
    example, our antiquated mainframe custom-designed time and
    attendance system cannot be successfully reprogrammed to handle
    the accounting requirements imposed by the Fair Labor Standards
    Act.
        Despite a year's worth of effort, we have been unsuccessful
    in making that work in a streamlined fashion for us. For that
    reason, we have had great difficulties in providing accurate
    overtime reports and reconciling pay issues, and I am delighted
    the board has sought to provide assistance by commissioning an
    administrative systems and information management review. It is
    hoped that once this review is completed the department will
    have state-of-the-art systems in place to support the officers
    in the field.
        As directed by the committee last year, we have included
    amounts for reimbursing the Senate Sergeant at Arms for
    computer and telecommunications services in our budget. I would
    just like to point out that should these amounts not be
    approved, they will need to be restored to the Senate Sergeant
    at Arms budget, since obviously data processing and
    telecommunications are the lifeblood of any police agency, and
    without that we would just cease to be effective.
        Mr. Casey. And they are out of our budget, Mr. Chairman.
        Mr. Abrecht. In closing, I would like to again thank the
    committee for the appropriation you provided to relocate our K-
    9 operation to the Architect's facility at Blue Plains. These
    dogs are an important, vital element of the department's
    security operations, and we take great pride in running the top
    explosives detection K-9 program in the country. In fact, just
    2 weeks ago, Officer George Lyter and his dog Maik took first
    place at the U.S. Police Canine Association's national trials
    in St. Paul, MN, in the explosive detection area.

                               prepared statement

        It is essential that our K-9's be well cared for and
    provided with adequate kenneling and training facilities so
    that we can continue to provide the highest quality and most
    effective service. This summer we will move into the
    Metropolitan Police K-9 building. This building is currently in
    a state of disrepair. Therefore, I hope the committee approves
    the Architect's request to renovate this facility for the
    department's use.
        I will be happy to answer any questions you have.
        [The statement follows:]

                     Prepared Statement of Gary L. Abrecht

        Mr. Chairman and members of the Committee, I am honored to
    appear before you to discuss the fiscal year 1998 Budget
    Request for the United States Capitol Police.
        Last year was a time of operational growth for the United
    States Capitol Police. Due to the lessons learned from the
    sarin gas attack which occurred in the Tokyo subway, we have
    developed a chemical/biological incident response capability
    for the Capitol complex. This capability complements the
    exemplary explosive device detection and disposal ability the
    Department has maintained since 1971. In addition, we have
    expanded our protective intelligence capabilities. We routinely
    exchange information which impacts on the security of the
    United States Congress with other national security and
    intelligence agencies. These increased operational and
    intelligence exchange capabilities have significantly enhanced
    our ability to deter, interdict, or respond to acts of violence
    directed at the Congress and those who work and visit within
    the Capitol complex.
        You will recall that last year I reported that threats
    against Members of Congress nearly doubled from the year
    before. I am pleased to report that cases this year have
    decreased from last year's peak, although the number of threat
    cases is still above the average for previous years. Compared
    with the previous twelve month period, the Department's Threat
    Assessment Section has recorded a 33 percent decrease in direct
    threats to physically harm Members of Congress. Implied threats
    have also decreased while direction-of-interest cases have
    significantly increased. We continue to diligently investigate
    each case that is brought to our attention and work closely
    with other law enforcement agencies to successfully resolve
    these cases.
        The crime situation in the Washington area, and in the city
    in particular, has been of concern in recent months, so we have
    been particularly diligent in looking out for the safety of the
    public, Members, and staff in our area of jurisdiction, and I
    am pleased to report that crimes against persons within the
    Capitol complex continue to decline. Last year within our
    primary jurisdiction, crimes against persons dropped by 8
    percent. This year, such crimes decreased again by 33 percent
    for a total of only 16 reported incidents for the entire year.
    This figure is remarkable when one considers the millions of
    people who visited or travelled through the buildings, streets,
    and parks of the Capitol complex last year. Property crimes
    also decreased by 29 percent compared to the previous twelve
    month period. In the area surrounding the Capitol complex which
    comprises the Extended Jurisdiction Zone, 731 crimes against
    persons and 3,124 property crimes were reported. I feel that
    our patrol and enforcement efforts deter this level of criminal
    activity from occurring within the Capitol complex.
        This year's budget request contains a pay initiative which
    is intended to ensure that the salaries and benefits the
    Congress provides to the men and women of the U.S. Capitol
    Police remain comparable to those which are provided to their
    counterparts in other similar federal law enforcement agencies.
    Aside from the issue of fairness, this initiative will ensure
    that the Department can continue to recruit and retain the
    highly qualified officers we need to effectively perform our
    mission. The issue of attracting the best possible officer
    candidate has become even more critical due to the increasing
    complexity and technical nature of our mission. Therefore, I
    urge the Committee to support this request and provide funding
    to institute these pay initiatives.
        As a result of the leadership and support of the Committee,
    the responsibility for the physical security systems within the
    Capitol complex has been transferred from the Architect of the
    Capitol to the new Capitol Police Physical Security Division. I
    appreciate the Committee's recent approval of Phase One of our
    system design and installation plan. Once the installation is
    completed, all of the security systems will be state-of-the-art
    and completely integrated. This means that the systems will be
    more easily maintained and police operations and alarm response
    will be streamlined and improved. The installation of these
    systems is a significant advance in the security of the
    Congressional community. I thank the Committee for your support
    of the project and I am confident you will be pleased with the
    results.
        Over the past several years, the Department has made great
    strides in our operational capabilities. We have reduced crime,
    increased training, improved our response capabilities,
    addressed new threats, and as I have just stated, we are in the
    process of making vast improvements in the physical security
    systems. Now it is time for us to look inward and identify
    areas in our administrative infrastructure where improvements
    can be made and fiscal savings realized. We are pursuing two
    initiatives to attain this goal. First, we have conducted an
    exhaustive review of every police post to include staffing
    levels and the hours each post is required to be staffed in
    order to determine if our personnel can be redeployed. The
    results are now being compiled and analyzed and I expect to
    make some recommendations to the U.S. Capitol Police Board in
    June, which if they prove acceptable, could result in reduced
    police post staffing costs without affecting security.
    Furthermore, we are also reviewing staffing of support and
    administrative positions to seek additional reductions.
        The second initiative consists of a management review of
    our internal accounting and information management systems. The
    weaknesses of our administrative infrastructure were
    highlighted by the onset of the Congressional Accountability
    Act. Our antiquated, mainframe, custom-designed Time and
    Attendance System cannot be successfully reprogrammed to handle
    the accounting requirements imposed by the Fair Labor Standards
    Act. Therefore, we have great difficulties in providing
    accurate overtime reports and reconciling pay issues. I am
    delighted that the Board sought to provide assistance by
    commissioning an administrative systems and information
    management review. It is hoped that once the review is
    completed, the Department will have state-of-the-art systems in
    place to support the officers in the field.
        As directed by this Committee last year, we have included
    amounts for reimbursing the Senate Sergeant at Arms for
    computer and telecommunications services. I would like to point
    out that should these amounts not be approved, they will need
    to be restored to the Sergeant at Arms' fiscal year 1998
    budget.
        In closing, I would like to thank the Committee for the
    appropriation you provided to relocate our K-9 operations to
    the Architect's Blue Plains facility. These dogs are an
    important element of the Department's security operations and
    we take great pride in running the top explosives detection
    canine program in the country. In fact, just two weeks ago
    Officer George Lyter and his dog Maik took first place at the
    United States Police Canine Association national trials in St.
    Paul, Minnesota. It is essential that our canines be well cared
    for and provided with adequate kenneling and training
    facilities so that we can continue to provide the highest
    quality and most effective level of service. This summer, we
    will move into the Metropolitan Police K-9 building. This
    building is currently in a state of disrepair. Therefore, I
    hope the Committee approves the Architect's request to renovate
    this facility for the Department's use.
        I will be happy to answer any questions you may have.

        Senator Bennett. Thank you. Mr. Hantman, do you have a
    statement?
        Mr. Hantman. I am basically here in support of the others.
    At my confirmation hearing Senator Warner recommended I be
    greatly involved in any considerations on security as it
    relates to accessibility of the Capitol.
        It is a very delicate operation we are involved with, and
    we need to guarantee the security, but yet not be a closed
    facility to the public and to the visitors. The overall
    reevaluation of security on Capitol Hill is a critical one, and
    we are cooperating very well in terms of the Sergeant at Arms
    in both the Senate and the House.
        We will take a serious look at what is happening in
    security and how we can improve it and still make it compatible
    with the historic nature of the Capitol of our country. It is a
    real challenge. I welcome it, and I would like to be part of
    this board and I think we will serve the Capitol well.
        Senator Bennett. Thank you. Senator Dorgan, do you have a
    statement?
        Senator Dorgan. Mr. Chairman, I regret I was late. My
    schedule said 10:30. In any event, I have read the statements
    and appreciate the testimony.

                              upgrading Computers

        Senator Bennett. Let me ask a few quick questions, and
    Senator Craig, can I ask you to Chair between 10:30 and 10:35,
    if you would?
        Senator Craig. Yes.
        Senator Bennett. Thank you. I have a 5-minute assignment I
    need to leave for.
        I recognize the need to update your computers and technical
    assistance. Have you looked far enough ahead in your planning
    to be able to speculate, or put a tougher word on it, that
    expenditures in this area will go down once you have acquired
    the equipment necessary, or are we looking for an ongoing level
    of increased activity in this area, and I do not ask that with
    any loaded intent. I just want to be forewarned as to where we
    would go in years to come with this.
        Mr. Casey. I will go ahead and speculate. One of the
    reasons that including the resources in the Sergeant at Arms
    budget back in the police budget is to give the police the
    resources rather than relying on somebody else to begin
    managing in the way they see fit, rather than coming to us as
    sort of a forced client of ours and accepting what we give
    them.
        What we are hoping happens, and, in fact, in our
    preliminary discussion we are hoping happens, is that they now
    have these resources. They can begin to better utilize those
    resources to accomplish what they want to get done. I believe
    that the amount we have in there is more than sufficient, and
    they should probably go down thereafter.
        Senator Bennett. How much of this is for acquisition of
    hardware and how much is for new programming of software
    techniques?
        Mr. Abrecht. About $1 million of the $2 million is for
    hardware acquisition to replace the work stations which are
    486/33's at the present time, and there is quite a lot of other
    hardware acquisition in there. I would say about three-quarters
    at the present time is for hardware acquisition and about one-
    quarter of it is software and software support.
        Senator Bennett. So presumably the hardware will last more
    than 1 year.
        Mr. Abrecht. Yes, sir.
        Senator Bennett. Although in this fast-changing environment
    you can never be sure.
        Mr. Abrecht. Certainly more than 1 year, but there seems to
    be a trend that these things have a life cycle of 3 or 4 years.
        Senator Bennett. This is a very tiny nit-pick because the
    amount of money is so small in Federal terms that it is almost
    not worth raising, and I raise it solely because it might
    indicate a management issue.

                           Transportation of persons

        Your request for transportation of persons includes an
    increase of $25,000, and in fiscal 1996 the Capitol Police
    spent $439,360 for transportation of persons, and it strikes me
    that there is again a very small amount of money, but a
    disconnect between what you are requesting and what you are
    actually doing. It appears you are constantly reprogramming
    money into this, and should you not just say that we need
    $400,000, or whatever the number is, instead of these
    unrealistically low figures?
        Mr. Abrecht. I guess we are always hoping they will go back
    down. It is very hard to estimate this because it is
    essentially driven by threats against Members of Congress and
    by CODEL's and substantial committee hearings. Excuse me, not
    CODEL's but committee hearings at remote locations, and so it
    is just very hard for us to figure them.
        We are always hopeful we will not spend as much money as we
    have in the past year, and so basically I am a cheapskate. I
    say, no, we have got to keep these costs down, and so I do not
    look every year to say, well, we will have as bad a year next
    year as we had the last year. Maybe they will go back down to
    the level they were before, and so I have not sought to budget
    for every eventuality.
        This year we just did a very expensive hearing in Puerto
    Rico, and the distance is a long way away. It took a large
    number of people. There were demonstrations of substantial size
    scheduled, and so we incurred a very large expense doing that.
    I hope next year that will not happen, and so I have not just
    given myself a comfort zone of everything that could possibly
    happen.
        It is a problem. These things are not schedulable, and that
    is why we have tended to be on the conservative side, and I
    realize we impose a burden on the committee when we have to ask
    for reprogramming to cover those.
        Senator Bennett. Again, it is not a major item, but it
    raised in my mind the question of management circumstance here.
        With that, I will yield to Senator Dorgan.
        Senator Dorgan. Mr. Chairman, thank you very much. I am
    told that this is the first time the entire board has appeared
    with the chief at this appropriations hearing, and we
    appreciate that. The board has an excellent reputation, and we
    very much appreciate the work that the force does.
        I would like to ask about the chart behind you. Who brought
    the chart?
        Mr. Abrecht. I did.

                                  Jurisdiction

        Senator Dorgan. That is a striking chart, and with that
    chart you described the extended jurisdiction of the Capitol
    Hill Police and the crimes committed within that jurisdiction
    in a 1-year period, is that right?
        Mr. Abrecht. That's right, sir. The red line is the primary
    jurisdiction, the Capitol Grounds, and the green line is the
    extended jurisdiction.
        Senator Dorgan. And the extended jurisdiction, can you
    describe that for me? What does the extended jurisdiction mean?
        Mr. Abrecht. In 1992 the Congress recognized the fact that
    our officers inevitably are off the grounds quite a bit and
    going to take care of various congressional facilities that are
    located off the ground, and there have been some incidents
    where they've been unable to take the police cases that they
    have made out there. They were thrown out of court because we
    did not have jurisdiction. So in 1992 the Congress gave us
    jurisdiction out to this green line in order that our officers
    could be protected from civil liability and have arrest
    authority within that area when they were out there doing their
    congressional business.
        Senator Craig. You do not normally patrol out to the green
    line?
        Mr. Abrecht. No, sir.
        Senator Craig. You just go out there, as you said, for
    congressional facilities and other targeted activities?
        Mr. Abrecht. That is correct. We do not do a general patrol
    for the deterrence of crime in the green area. We are only
    there for some congressional purpose.
        Senator Dorgan. Do you have a second chart as well?

                                Property crimes

        Mr. Abrecht. Yes; I have the property crimes.
        Senator Craig. Senator, I was just thinking of moving to
    the Hill. [Laughter.]
        I have decided not to. [Laughter.]
        Mr. Abrecht. Do not do that. I have lived on the Hill
    myself for 25 years.
        Senator Dorgan. But I look at these charts and it looks
    like a virtual crime wave in this jurisdiction. I come from a
    town of 300 people, where we had one felony last year, which
    was extraordinary. It was the talk of our county, because we
    have not had a felony for years and years and years, but this
    looks like a virtual crime wave. Is that an isolated year, or
    would you expect that next year?
        Mr. Abrecht. Obviously, we hope next year always will be
    better. The indications are that in the District of Columbia it
    has begun to go back down. It is not unusual for large urban
    areas. If you look at the city as a whole, it is certainly not
    the worst part of the city, but it is a substantial amount of
    crime. It is for an entire year.
        Senator Craig. Is this activity an increase over fiscal
    year 1994? Let us see, this is for--OK.
        Mr. Abrecht. This is the last fiscal year.
        Senator Craig. The fiscal year before, how does it stack
    up? Has it declined?
        Mr. Abrecht. For the Capitol Grounds it is a decline. Let
    me just get you it for the extended jurisdiction. I believe it
    is about the same as my recollection.
        Senator Dorgan. Just adding in my head, it looks as though
    crimes against persons and against property number about 4,000
    crimes on these two charts, which is an extraordinary number of
    crimes in a relatively small part of the city.
        Mr. Abrecht. The vast bulk of that is car break-ins, what
    makes up the huge volume of it, which is the yellow dots on
    this map.
        Senator Dorgan. We view car break-ins as serious in our
    county. [Laughter.]
        Mr. Abrecht. I certainly view them as serious as well, sir.
    It is one of the few crimes we do have to do something about on
    the Capitol Grounds.
        To answer your question, Senator, there was a decrease in
    the extended jurisdiction zone of 4 percent between the last 2
    fiscal years. There had been a substantial increase the
    previous year, so actually 1996 is down 4 percent from 1995,
    which was up substantially from 1994, so that is a trend at the
    present time.
        Senator Dorgan. I appreciate that. I will go on to a couple
    of other questions, but I was just curious about the chart.
    That is the first time I have seen a chart like that, and it is
    staggering to see the amount of crime in the extended
    jurisdiction in 12 months.

                                   Pay parity

        You, chief, indicated that there was a need to establish a
    pay parity initiative, and my question would be, with whom
    would the Capitol Police force achieve parity if the initiative
    was funded?
        Mr. Abrecht. The agencies we compare ourselves with
    primarily are the two other Federal uniformed law enforcement
    agencies in town, being the U.S. Park Police and the U.S.
    Secret Service's Uniformed Division, and we also, of course,
    seek to maintain parity with the large suburban police
    departments which are essentially the agencies we compete for
    personnel with. If we lose officers it is typically to either
    the Park Police or the Uniformed Division or the large suburban
    agencies, Montgomery County, Fairfax County, Prince Georges.
        Senator Dorgan. You are asking in the budget for a COLA
    increase as well as comparability increase. Who will receive
    the comparability increase, and how will that be distributed if
    you receive it?
        Mr. Abrecht. The comparability increase is essentially a
    term of art that has come around here to represent what is
    known in the executive branch as locality pay.
        You recall, essentially the Federal Government in its
    wisdom now divides its pay, annual COLA, if you will, into two
    parts, the cost of living, which is national, and a regionally
    based locality pay, and we have essentially called that
    comparability pay for our purposes, and it is essentially the
    same COLA that would be received by all of our people, so it
    would go across the board. Whatever is put in place in the
    Executive Office we would ask the same for our office.
        Senator Dorgan. Well, I want to thank the board for its
    work, and chief, thank you, and say that most of us spend our
    days here not thinking about the work of the law enforcement
    officials of the Capitol, but they do a wonderful job, and we
    need to think more and appreciate more about the work that they
    do for us. We may have other questions about the specifics of
    the budget, but we appreciate your appearance.
        Thank you. Senator.
        Senator Craig [presiding]. Chief, let me also echo what
    Senator Dorgan has just said. I am sitting here looking at
    these charts, and my goodness, I did not realize that I worked
    every day in a virtual war zone. Now, that speaks well for you
    in the sense that I come from an area of the country and a
    community not unlike the Senator's, in which crime in itself is
    still a happening and viewed with alarm, almost any level of
    crime, and so when you see these kinds of figures or portrayals
    you react to them.
        But I must say that working here I do not sense that it is
    the No. 1 terrorist threat or target, although I recognize,
    from your statistics and all the other things you have to deal
    with, that is exactly true because of the character of this
    building and what goes on in it.

             consolidating Library and Supreme Court Police forces

        Let me ask a question about an effort that the board sought
    to undertake last year: to consolidate the Library of Congress
    Police force and the Supreme Court Police with the Capitol
    Police. A one-time cost of the transition was estimated at
    approximately $3.2 million. Has any study been done to
    determine the long-term benefits and cost savings of
    consolidating the forces?
        Mr. Abrecht. When we did the study, and at least one
    previous study, we could not identify any substantial long-term
    cost savings, the reason being that there is essentially no
    post duplication. There is no place where there is a Capitol
    Police officer walking the same place that there is a Library
    officer walking.
        There was one post, the Cannon tunnel. We discovered that
    one, and it was brought to our attention, and we took care of
    it. We worked out an agreement with the Library, and we share
    the work there. There are not two officers there any more.
    Other than that, there is really no overlap in work.
        Another thing we determined was that the Library, maybe you
    would think that there were administrative structures that were
    duplicated, but it turns out all of the administrative work for
    the Library Police is essentially done by their Library
    entities.
        They do not have their own personnel shop, data processing
    shop. All of that is essentially done by the Library's total
    operation, so we could not come up with any substantial cost
    savings in doing this.
        We tried fairly hard, and could come up with no
    duplications that would obviously disappear if we were to take
    over that operation, so it did not look like there was any real
    long-term savings.
        Senator Craig. So that the $3.2 million as a cost of
    transition, is that now a fixed cost in the budget that you
    need annually?
        Mr. Abrecht. It would be a one-time cost. If Congress were
    to decide to do that, and I have not heard any discussion of
    that issue, there would be a one-time cost, a substantial cost
    for training and to replace officers to get them trained up to
    our standard.

                                  K-9 facility

        Senator Craig. I see you are getting a new doghouse. Tell
    me about the K-9 facility. Out of pure curiosity, how many dogs
    do you have on the staff?
        Mr. Abrecht. We have 30 dogs. Their primary purpose is bomb
    detection. We had an absolutely horrible facility about 2 years
    ago, and got to the point where the dogs died from a vermin,
    what appeared to be a vermin infestation in the old facility at
    the old Poplar Point Nursery.
        And so after that crisis this committee very generously
    provided some interim funding to put up a temporary facility
    out at Blue Plains, where the Architect has a large warehouse
    and nursery facility, and we moved over there.
        The Metropolitan Police Department was sort of essentially
    squatting on the Architect's facility there, and they finally
    are in the process of building themselves a new facility, after
    which we will take over their facility, which is quite rundown.
    It is going to need a little work, but after that we will have
    a good indoor kennel facility at Blue Plains, and we will be
    able to take care of all of our needs.
        Senator Craig. Well, it is interesting for you to explain
    what role these dogs play. I know we see them quite often. I
    understand why they are around, and also recognize that we have
    maybe one of the best in the country, if not the best. It is
    interesting, and it certainly fits well with the concern about
    the Capitol being the No. 1 target of terrorists, and I suspect
    that a bomb or bombs would be the weapon of choice in most
    instances with terrorists, so it is good to hear about that.
        Mr. Abrecht. Yes; it is a great program. It is not one I
    can say I started. It has been around for about 20 years. They
    have an excellent training, and it is first-rate at the present
    time, and we are going to work to keep it that way.
        Senator Craig. Thank you very much, Mr. Chairman.
        Senator Bennett [presiding]. Senator Stevens, do you have
    any questions?

                                     Bombs

        Senator Stevens. I only have one question, thank you.
    During my watch as whip we had two bombs, and I have been very
    concerned about bombs and various things. We have talked about
    the general problem of overall readiness for terrorist-type
    activities.
        One of the things that always sticks in my mind was that
    bomb upstairs was placed there because someone had studied the
    routine. It was about 8 minutes after the change of personnel,
    and personnel were a little late in getting there. They did not
    overlap. There was a gap at the time that bomb was placed
    there.
        But do we have some sort of instruction to our people about
    how to deal with routine--I mean, if everybody is at the same
    place every day, and they know exactly where you are going to
    be and who is going to be there and what time, and know the
    idiosyncracies of being late, or changing, or going to get a
    sandwich or whatever it might be?
        The briefings we had at that time indicated that the best
    way to foil attempts of that kind of terrorism was to not have
    such routines that are so strict. As a matter of fact, as I
    told you, they even told the Senators not to drive in the same
    way, to vary the cars they drive in, and various other things.
    But I do not see much attempt at that now. Have we abandoned
    that practice of having different schedules and different
    people at different places and times of change being different,
    every day?
        Mr. Abrecht. We try very hard to have officers avoid
    becoming routine, particularly in the performance of their
    duties, and we try to rotate posts as much as we can. There are
    obviously tradeoffs here. There are tradeoffs between knowledge
    of the post and complacency, essentially.
        It is obviously an advantage for us to have officers at
    certain places who know the Members who are coming through that
    area, know the routine, know the senior staff who work in that
    area, and when you constantly rotate people you lose that
    aspect of it, but you are also correct that you gain in the
    battle against complacency.
        So there is sort of a constant balancing that we have to go
    through, and if we are moving in any direction we are moving
    toward more of a rotation and less permanently assigned
    officers for just that, among other reasons, and it is
    something that we have to constantly guard against.
        Every time there is an incident like the Oklahoma City
    bombing people tend to be more alert, more careful, and to
    avoid this tendency toward complacency and routine. Then, over
    time it tends to get complacent again and to get routine again,
    and we know that we have to continue to battle that.
        Senator Stevens. Thank you.
        Mr. Casey. There is also, Mr. Chairman, the continual
    conflict between what they have as general orders, and their
    officers following the general orders to the letter, and the
    inconvenience that it sometimes puts both the visitors and the
    Members to.
        We get a lot of pressure on occasion to ease up,
    particularly at the staff doors, with things like that and
    become familiar with those people and to sort of change the way
    you interpret that order to allow those people that you would
    ordinarily recognize to come through, but we constantly get
    that kind of pressure, too, but they have been very, very good
    about trying to be as good and gentle as they can about
    enforcing that general order to the letter so something like
    that familiarity does not creep in.
        Senator Stevens. Thank you.
        Mr. Livingood. If I could add one other thing, one of the
    big issues in this area is training. Specifically, a terrorist
    will generally do a surveillance prior to coming, as you
    mentioned, to try something, and what we are going to be doing
    in our new classes, in-service classes, is adding a course of
    countersurveillance so the officers know what people to be
    looking for and how to sort of pick them out. That will add to
    the alertness of the officers.
        Senator Stevens. Well, I can understand having the same
    people and get to know sort of the clientele for a particular
    entry or passage, but it does seem to me that the mistake we
    made back in those days is that we were just letter perfect in
    every shift change. People came in 10 minutes late, and
    everyone was doing the same thing. I was always impressed with
    the lectures they gave us on how to avoid that, where you have
    shifts change at different times, and only announce them the
    day before instead of posting them on the wall so people could
    see them.
        It does seem to me that we ought to be more attuned, and I
    still think we are going to be a target. We are a main target
    for terrorism against the Government, either these facilities
    or the White House, but not in the sense of our personnel. I
    think it is the buildings.
        Thank you, Mr. Chairman.
        Senator Craig. Mr. Chairman, possibly one more question in
    this area. I am curious, in the training that you put your
    staff and the officers through. Do you ever attempt to have an
    unknown penetrate the area? Is that part of the training, to
    actually attempt to do that?
        Mr. Abrecht. We have not in recent times done testing of
    our facilities.
        Senator Craig. How do you do countersurveillance, then,
    from the sense that, I mean, obviously I can appreciate
    training people to look for certain things and certain patterns
    and certain kinds of human behavior or human activity, but
    unless you really attempt to have somebody penetrate a
    location----
        Mr. Abrecht. We train officers in how to watch for people
    who appear to be conducting surveillance of facilities, or who
    are lurking around, or try to figure out what is happening. We
    are essentially testing our system itself, rather than just
    shoo them away, to actually find out what they might be up to.
    Someone trying to come in through a garage door on foot, for
    instance.
        Mr. Casey. There are a number of things you may want to
    discuss on that in executive session.
        Senator Craig. I appreciate this is a public meeting.
        Mr. Chairman, I have one personal request. I drive by your
    facility at Blue Plains, and I see those greenhouses, and I
    would love to go visit that sometime, and I would like to see
    the dog facility also.
        Senator Bennett. I would recommend while the Architect is
    here that all members of the subcommittee take advantage of the
    opportunity to tour some of those facilities, particularly when
    we are getting ready to increase the budget for repair.
        Some of these buildings are what, 60 years old or
    something, and we are going to have to make a major renovation.
    I have been through them, and I recommend that every member of
    the subcommittee take the opportunity.
        The Architect has been very generous with his time, but I
    am sure he will be happy to take the opportunity.
        If there are no further questions----
        Mr. Casey. Mr. Chairman, I do have a detailed breakdown of
    the cost, and I can make that available to your office so that
    you can go through that.

                         Additional committee questions

        Senator Bennett. Thank you. Any further questions will be
    submitted in writing.
        Mr. Casey. Thank you, Mr. Chairman. On behalf of the Police
    Board we appreciate your time.
        Senator Bennett. We appreciate your coming. We will move
    quickly to the next panel.
        [The following questions were not asked at the hearing, but
    were submitted to the board for response subsequent to the
    hearing:]
                         Additional Committee Questions
                                 new positions
        Question. You are requesting three new positions in fiscal year
    1998. What are these positions? Can these positions be absorbed through
    attrition?
        Answer. Two of these positions are in support of the anticipated
    migration of the Senate-side payroll to the National Finance Center.
    The third position will be assigned to the Office of General Counsel in
    support of administering the Congressional Accountability Act.
        It is increasingly difficult to absorb the staffing of new
    functions through attrition. In fiscal year 1992, the Capitol Police
    had an authorized staffing level of 1,357 positions. For the past two
    years we have operated at a level of 1,299 positions, a reduction of 58
    positions.
                            cola/comparability costs
        Question. In addition to the $212,000 requested for new positions,
    you are requesting $1.985 million for ``Mandatories''. Specifically,
    what is included in this amount?
        Answer. The amounts requested are to fund the anticipated cost of
    living allowance in fiscal year 1998 as well as a comparability
    increase for sworn personnel. In the current fiscal year, uniformed
    personnel received an increase of 3.33 percent, which included the
    nation-wide cost of living increase of 2.3 percent. Civilian personnel
    received the 2.3 percent COLA.
        The fiscal year 1998 cost of these increases is estimated to be
    $1,468,000. This increase would become effective on January 1, 1998,
    and reflects the rate of 2.8 percent, for the COLA and .7 percent for
    the comparability pay. The amount of $403,000 is also requested to
    cover the cost of the 1997 increases in fiscal year 1998. The net
    increase in employee benefits associated with these increases is
    estimated at $114,000.
                             pay parity initiatives
        Question. You have requested that the committee fund a pay parity
    initiative. Parity with whom? If we approved this initiative, would you
    require statutory authority to implement?
        Answer. Over the past several years, the Capitol Police Board, with
    the support of this committee, has pursued the on-going objective of
    gaining and maintaining parity with other similarly situated Federal
    law enforcement agencies with are covered under Title 5 of the USC.
    Principally, these agencies are the U.S. Park Service and the Uniformed
    Service of the Secret Service.
        Notably, recent initiatives have included the Capitol Police
    Retirement Act, pay compression, mandatory retirement, Cost of Living
    Adjustments and Comparability pay.
        The USCP competes directly with other Federal law enforcement
    agencies in recruiting and it is essential that we maintain salary and
    benefit parity with them.
        The requested funding would allow us to pay USCP uniformed
    personnel for various differentials that are paid to other law
    enforcement personnel under Title 5, including Sunday, Holiday and
    Night pay. Obviously, we would defer to the prerogative of the relevant
    House and Senate authorizing entities to determine what additional
    actions, if any, would be required prior to implementation.
                           scheduled leave/threshold
        Question. You have requested that scheduled leave be counted toward
    the earning of overtime. Do you have current authority to make this
    adjustment?
        Answer. Current authority exists for us to administratively make
    the adjustment. However, I would be remiss if I didn't point out that
    the amount requested to fund this initiative would be disbursed as
    overtime and as such would increase our current estimate from $4
    million to $4.676 million.

                                                   PAYROLL COMPARISON--USCP VS. OTHER LAW ENFORCEMENT AGENCIES
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         FLSA OT   Including  Including                        Percent
                                                                        threshold  scheduled  scheduled ----------------------------------------------------
                                  Agency                                   (in       annual      sick        Night        Sunday        Holiday     COLA and
                                                                          hours)     leave      leave    differential  differential  differential   locality
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    U.S. Capitol Police...............................................         85         No         No         None          None          Comp        3.33
    U.S. Park Police..................................................         80        Yes        Yes           10            25           100        3.33
    U.S. Secret Service...............................................         85         No         No           10            25           100        3.33
    FBI...............................................................         80        Yes        Yes           10            25           100        3.33
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Sunday Pay @ 25 percent. Holiday Pay @ 100 percent. Evening: 1800 to 0600 @ 10 percent; 1500 to Midnight @ 7.5 percent; Midnight to 0800 @ 10 percent.

                            remaining parity issues
        Question. If the pay parity initiatives are approved, what
    remaining differences would remain. Please enumerate.
        Answer. There are no other parity issues of substance. The USCP
    retirement system mirrors that of other Federal law enforcement
    agencies.
                            other services increase
        Question. In the category of ``Other Services'' you have requested
    an increase of $2.4 million. Please explain the increase.
        Answer. Of the $2.4 million requested, $2.1 million will be used
    for telecommunications and computer services. The inclusion of these
    items is at the direction of the Senate Subcommittee on the Legislative
    Branch and represents a budget authority transfer from the Office of
    the Senate Sergeant at Arms which previously budgeted for these
    services.
        Also included in our ``other services'' request are funds to
    upgrade the departmental accounting system, possibly through a cross-
    servicing agreement. The amount of $100,000 is requested in this area
    which will include funding for the annual agreement, outside
    consultation on meeting Comptroller General standards, assuring that
    internal and external interaction requirements are met and that data
    can be collected and reported consistent with Federal fiscal
    standardization. Finally, it may be necessary to acquire specific
    hardware and connectivity to implement the new system dependent upon
    which option is selected.
        The amount of $170,000 is also included in this object class to
    fund the biennial cost of the promotion exam.
                        computer and telecommunications
        Question. You have requested funds to reimburse the Senate Sergeant
    at Arms for Computer and Telecommunications services? Please explain
    what services are provided.
        Answer. In fiscal year 1998, we have requested $1,247,000 for
    computer products and services, and $929,000 for telecommunications
    services that were previously provided by the Senate Computer Center
    (SCC). These amounts are included at the direction of the Senate
    Subcommittee on the Legislative Branch. We will have the option of
    purchasing these products and services directly from private vendors,
    or reimbursing the SAA.
        In general, the types of services in the computer area include
    hardware and software upgrades, a pro rata share of software licensing
    and maintenance contracts, replacement of obsolete workstations and
    funding to migrate our applications from the SCC's mainframe
    environment.
        In the telecommunications area, funding is requested for
    maintenance for circuits, facsimile equipment and radio systems,
    monthly usage charges for local telephone service, radio telephone
    circuits, cellular phones and pagers. Funds are also requested for
    upgrades of systems, new consoles for the CAD system and new command
    center.

    New hardware--5 color printers, control card, cables, and
        other accessories.........................................   $14,000
    Hardware and software maintenance--reimburse the Senate
        Computer Center for the maintenance of 300 personal
        computers, 105 printers, 8 file servers, and software.....    53,463
    Mainframe to PC migration--Senate requires us to migrate our
        applications from a mainframe environment to personal
        computers within two years. These funds will pay for
        consulting services, and we will require more funding in
        fiscal year 1999..........................................    70,000
    Software and software upgrades--upgrade to Corel Office Suite
        and Windows NT 4.0........................................    89,589
    Replacement of existing workstations--current 486/33
        workstations are approaching obsolescence and cannot run
        applications currently on our system. Faster, workstations
        with greater memory are needed in order to complete the
        migration project......................................... 1,020,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal computer services.............................. 1,247,052

        In fiscal year 1998, we have requested $929,000 for
    Telecommunication products and services. Summarized costs are
    as follows:

    Frame Relay Circuit and Routers...............................    $1,920
    10/100 Ethernet Network Interface Cards.......................     4,000
    Cellular Telephones and Pagers................................     4,804
    Facsimile Maintenance.........................................     6,100
    NFC Conversion Telecommunication Services.....................     9,000
    Streetguard Computer Aided Dispatch (CAD) System Maintenance..    14,000
    Radio Circuits................................................    15,000
    Upgrade of Police Metropolitan Area Radio System..............    20,000
    Business Telephone Lines......................................    25,000
    Technical Support for Senate Security while traveling.........    25,000
    AT&T System 75 Maintenance....................................    32,000
    Hand Held Radio Maintenance...................................    50,000
    New Hand held Radios..........................................    60,000
    Replacement and/or repair of GE Radio Receivers...............    60,000
    New Consoles for the CAD System in the Communication Center...    70,000
    Upgrade of System 75 to Definity G3I..........................    70,000
    Local telephone Service.......................................    98,000
    Radio Coverage................................................   100,000
    Radio System Maintenance......................................   114,000
    New Command Center............................................   150,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal telecommunication services.....................   928,824
                                 house services
        Question. What services are provided to the USCP by the House? Is
    there any reimbursement to the House offices for theses services?
        The Office of the Chief Administrative Officer performs payroll
    disbursement services for the House side and the disbursement function
    for the general expenses appropriation. In addition, the House Sergeant
    at Arms pays for telephone services of the USCP on the House side. We
    provide no reimbursement for these services.
                     accounting function/management review
        Question. You have requested funds to possibly have your accounting
    functions cross-serviced by another agency. Have you discussed this
    option with the Library of Congress? Would this initiative save money?
        Answer. Also included in our ``other services'' request are funds
    to upgrade the departmental accounting system, possibly through a
    cross-servicing agreement. The amount of $100,000 is requested in this
    area which will include funding for the annual agreement, outside
    consultation on meeting Comptroller General standards, assuring that
    internal and external interaction requirements are met and that data
    can be collected and reported consistent with Federal fiscal
    standardization. Finally, it may be necessary to acquire specific
    hardware and connectivity to implement the new system dependent upon
    which option is selected.
        The accounting function within the department is currently being
    performed on an outdated system which has been in use for over ten
    years. There are several options available to the department, including
    developing our own accounting system. We believe that it may be more
    cost efficient however to be cross-serviced by another agency and we
    have begun discussions with several agencies to determine which may
    meet our requirements. There are no savings to be gained from this
    initiative in that the functions that would be provided are not
    currently being received.
                  physical security supplemental spending plan
        Question. In September of 1996, you received a supplemental
    appropriation of $3.25 million. How will these funds be expended? Do
    you have a plan in place for improving physical security?
        Answer. As the Committee is aware, early in 1995 the USCP and the
    U.S. Secret Service conducted a comprehensive physical security survey.
    In fiscal year 1996, responsibility for installations of physical
    security equipment was transferred to the USCP.
        Since that time, the USCP established a Physical Security Division
    (PSD), appointed a director and hired staff. A five-year budget and
    program plan was developed, approved by the Board and forwarded to the
    Senate and House Appropriation Committees. The Board then directed the
    PSD to provide a comprehensive security implementation plan based on
    the USCP/USSS survey. In December 1996, the USCP engaged the Department
    of the Army, Physical Security Equipment Management Office to assist in
    the development of the implementation plan. This survey was initiated
    in January and included technical design, equipment selection,
    installation and cost estimates.
        In fiscal year 1997 responsibility for the maintenance of physical
    security was transferred to the USCP. At the time of this transfer,
    there were only 52 on-line accounts on the House side for the Members'
    duress alarm system, which had taken over three years to install. Since
    that time, the USCP has installed 245 additional systems in less than
    six months. Additionally, the Maintenance Section has completed more
    than 1,000 requests for service repairs since October 1, 1996. This is
    double the amount completed in the entire preceding year prior to the
    transfer. We have accomplished this without increase in personnel,
    funding or overtime while expanding coverage to seven days each week.
                                    aoc mou
        Question. The implementation of physical security plans in the
    Capitol complex will require close coordination with the Architect of
    the Capitol on matters relating to design. How will you assure that
    this coordination will be carried out?
        Answer. We have executed a Memorandum of Understanding with the
    Office of the Architect as specified in the Conference Report
    accompanying H.R. 3610, Making Omnibus Consolidated Appropriations for
    Fiscal Year 1997 to delineate the process for implementing security
    projects.
                                  k-9 facility
        Question. Last year, emergency funding was arranged to alleviate
    serious problems associated with your K-9 facility. What is the current
    status of the project to take over the D.C. facility? Once you have
    moved into the facility occupied by D.C., are there plans to share any
    of the facilities since they will still be adjacent to your kennels?
        Answer. The Architect of the Capitol (AOC) has completed all their
    assigned work related to the emergency funding. The obedience, attack,
    and agility fields have been completed and fenced. All the trailers and
    storage areas have been put in place. The Metropolitan Police
    Department (MPD) will turn over their old facility, which includes 12
    indoor kennels, to the U.S. Capitol Police in April, after they move to
    their new training facility, which is now under construction. Even
    though these kennel facilities are an improvement from the one at
    Poplar Point, they still need considerable renovation. The AOC has
    requested funds to renovate our kennel facilities in fiscal year 1998
    and fiscal year 1999. We plan to share the obedience, attack, and
    agility fields with MPD.
                             senate/house positions
        Question. You have 637 positions on the House side, and 662 on the
    Senate side. Please explain why there are unequal numbers of positions.
        Answer. There has never been an attempt to divide the total number
    of positions equally between the two houses. Variations have occurred
    over time due to the implementation of various initiatives such as the
    screening of all freight destined for the Senate loading dock at the
    off-site delivery center, the security aide initiative, the physical
    security initiative, and so forth. It should be noted however that
    assignments overall are made without regard to the payroll on which an
    officer resides.
                                   nfc status
        Question. What is the status of the project to move the House
    payroll to NFC.
        Answer. Conversion of all House-appropriated U.S. Capitol Police
    positions and employees to the USDA/NFC payroll became effective on
    March 30, 1997. This included the transfer of payroll processing,
    salary and benefits disbursement, and retirement/benefits counseling
    functions from the House Finance Office to the Department. Appointing
    authority is retained by the Committee on House Oversight.
        In 1992, Title 40, Section 207a., was amended by legislation, and
    mandated that the House and Senate act jointly to provide for a unified
    payroll administration for the USCP. To that end, the USCP has been
    actively engaged in providing information to relevant Senate leadership
    regarding the conversion of Senate-appropriated positions to the USDA/
    NFC. Currently, the matter is under serious consideration by the Senate
    Committee on Rules and Administration, and the Committee on
    Appropriations. We have determined that should the Senate decide to
    expedite approval, a unified payroll could be achieved by the beginning
    of fiscal year 1998, at little or no cost incurred above that
    appropriated for fiscal year 1997. Thereafter, we have estimated that
    the total (unified) cost of USDA/NFC cross-servicing costs would be
    approximately $160,000 per annum.
                                unified payroll
        Question. What remaining impediments remain toward a unified
    payroll? What is keeping us from a unified payroll and consolidated
    reporting?
        Answer. Bifurcated administrative systems result in a complex and
    inconsistent infrastructure. Differences in the administrative systems
    and practices of the two chambers have created disparities between
    employees working side by side. They also result in critical
    inefficiencies when trying to capture and report management information
    for budget, accounting, manpower utilization, position management, etc.
    With the assistance of this committee, the USCP is addressing these
    problems through legislation, to eliminate the disparities between the
    two chambers. Some of the most visible inequities that exist are:
        Difference in personnel practices.--Nonpay status; payroll cycles;
    wage and earnings reporting; and pay setting.
        Differences in work/information flow.--Approval processes; and
    information feedback.
                              unionization status
        Question. What is the current status of unionization efforts in the
    USCP under the Congressional Accountability Act?
        Answer. The following is a chronology of activities to date
    regarding the unionization of USCP officers.
                          uscp unionization chronology
        October 1996.--Petition for Certification as exclusive bargaining
    representative by International Brotherhood of Teamsters, Fraternal
    Order of Police, and International Union of Police Associations.
        January 1997.--Board of Directors, Office of Compliance Decision
    Order. Excluding certain divisions of the USCP.
        February 1997.--Decision and Direction of Election issued by Board
    of Directors, Office of Compliance.
        April 1997.--Election held at USCP Headquarters. (Challenges
    sufficient to affect results.) International Union of Police
    Associations eliminated.
        May 1997.--Decision and Direction on Challenged Ballots.
        June 1997.--Second Election Runoff between International
    Brotherhood of Teamsters and Fraternal Order of Police.
        June 1997.--Certification of Representative certifies the Fraternal
    Order of Police as exclusive representative of all employees in the
    bargaining unit.
        TBD.--Collective Bargaining Agreement negotiations to begin.
                               accounting system
        Question. You have requested the amount of $100,000 within the line
    item ``other services'' to have the accounting function performed
    through a cross-servicing agreement. Please explain.
        Answer. The accounting function is part of a broader review that
    the Board will undertake within the department. While the USCP has made
    great strides in recent years in operational areas, the board will now
    place renewed emphasis on assuring that the administrative and
    management areas are in compliance with prescribed standards of the
    Comptroller General. We plan to conduct a department-wide survey and
    evaluation of internal accounting and administrative controls for the
    purpose of identifying weaknesses so that they can scheduled and
    assigned for corrective action.
        The accounting function within the department is currently being
    performed on an outdated system which has been in use for over ten
    years. There are several options available to the department, including
    developing our own accounting system. We believe that it may be more
    cost efficient however to be cross-serviced by another agency and we
    have begun discussions with several agencies to determine which may
    meet our requirements.
        In addition, we have included funds for an outside consultant to
    perform a requirements analysis leading to the design of an information
    technology plan which will meet the management needs and reporting
    requirements of the department.
                               physical security
        Question. Can you provide us with a brief overview of activities
    undertaken to date regarding the physical security function for the
    Capitol complex?
        Answer. As the Committee is aware, early in 1995 the USCP and the
    U.S. Secret Service conducted a comprehensive physical security survey.
    In fiscal year 1996, responsibility for installations of physical
    security equipment was transferred to the USCP.
        Since that time, the USCP established a Physical Security Division
    (PSD), appointed a director and hired staff. A five-year budget and
    program plan was developed, approved by the Board and forwarded to the
    Senate and House Appropriation Committees. The Board then directed the
    PSD to provide a comprehensive security implementation plan based on
    the USCP/USSS survey. In December 1996, the USCP engaged the Department
    of the Army, Physical Security Equipment Management Office to assist in
    the development of the implementation plan. This survey was initiated
    in January and will include technical design, equipment selection,
    installation and cost estimates.
        In fiscal year 1997 responsibility for the maintenance of physical
    security was transferred to the USCP. At the time of this transfer,
    there were only 52 on-line accounts on the House side for the Members'
    duress alarm system, which had taken over three years to install. Since
    that time, the USCP has installed 245 additional systems in less than
    six months. Additionally, the Maintenance Section has completed more
    than 1,000 requests for service repairs since October 1, 1996. This is
    double the amount completed in the entire preceding year prior to the
    transfer. We have accomplished this without increase in personnel,
    funding or overtime while expanding coverage to seven days each week.
        Finally, we are nearing the completion of Memorandum of
    Understanding with the Office of the Architect as specified in the
    Conference Report to accompany H.R. 3610, Making Omnibus Consolidated
    Appropriations for Fiscal Year 1997 to delineate the process for
    implementing security projects.
                           library of congress merger
        Question. For several years, there have been discussions and
    studies involving a merger with the police and security of the Library
    of Congress. What is the status of this proposal?
        Answer. In House Report 104-141 on the 1996 Legislative Branch
    Appropriations Bill, the Subcommittee on Legislative Appropriations
    instructed the United States Capitol Police to undertake discussions
    and a study to determine the extent to which the police and security of
    the United States Capitol, the Library of Congress and the United
    States Supreme Court can be combined as a unified operation under a
    single command utilizing common personnel.
        From an administrative perspective, the absorption of the Library
    of Congress Police (LOCP) by the USCP is feasible. If approved, we
    would anticipate entering into a Memorandum of Understanding with the
    LOC, with a projected date of transfer six months thereafter. The MOU
    would address issues regarding retirement, transfers of leave balances
    and training.
        In addition to personnel costs which we anticipate would be covered
    pursuant to an appropriation transfer, we have developed one-time cost
    estimates associated with the transfer.
        There are a variety of important administrative issues that would
    need to be addressed if the merger occurs. Many of these issues will be
    contingent upon specific congressional directives and mandates. Equally
    important is the merger's impact upon the budgets of those entities
    that provide valuable services to the USCP, e.g., Architect of the
    Capitol, and the House and Senate Sergeants at Arms.
                              systems acquisition
        Question. You have indicated that a review will be made of
    administrative and financial areas to replace an antiquated
    infrastructure. What provision is made for the cost of new systems?
        Answer. Included in our request is the amount of $100,000 which is
    dedicated to replacing the current expense control system in the
    accounting and financial management functions. Ideally, this
    replacement system will be attained through a cross-servicing
    arrangement with another agency.
        Secondly, within the overall amounts requested for reimbursement to
    the Senate Sergeant at Arms for computer services, are amounts to
    enable us to begin upgrading workstations, phase in a migration from
    the SCC workstation, and acquire a replacement for the time and
    attendance system.
        The pace and scope of all of the planned improvements will not be
    known until after our review is completed. At that time we will inform
    the committee of our plans and requirements. In the interim, we feel
    that the current request will allow us to move forward in all of these
    areas.
                          CONGRESSIONAL BUDGET OFFICE

    STATEMENT OF HON. JUNE E. O'NEILL, DIRECTOR
    ACCOMPANIED BY:
            JAMES L. BLUM, DEPUTY DIRECTOR
            GAIL DEL BALZO, GENERAL COUNSEL
            STANLEY L. GREIGG, DIRECTOR, OFFICE OF INTERGOVERNMENTAL
                RELATIONS
            POLLY E. HODGES, BUDGET AND FINANCE OFFICER
            DAVID M. DELQUADRO, PERSONNEL OFFICER
            MARK G. DESAUTELS, ASSISTANT FOR INTERGOVERNMENTAL RELATIONS
            DANIEL F. ZIMMERMAN, CHIEF, SYSTEMS DEVELOPMENT AND RESEARCH
                UNIT

                                 Budget request

        Senator Bennett. Our next panel is headed by the Honorable
    June O'Neill, the Director of the Congressional Budget Office,
    and we will dispense with the usual formalities and
    congratulations and greetings, because both Senator Dorgan and
    I are conferees of the conference that must convene at 11
    o'clock. I can be a little later than he can. He has a more
    direct interest in what is happening here than I do, so you are
    probably going to get a much lighter going over than you might.

                               summary statement

        Ms. O'Neill. Thank you, Mr. Chairman. I am accompanied by
    Mr. James Blum and the staff that has helped prepare the
    statement. I will be brief. Our budget request for fiscal year
    1998 is for $24,995,000, which allows an increase of 1.9
    percent, or $463,000, over our fiscal year 1997 appropriation.
        The amount of our request is about one-half of the 4
    percent increase that CBO would need to maintain its budget at
    the current services level--that is, taking account of pay and
    benefit increases and other rising costs.
        The requested amount would fund our current staff ceiling
    of 232 full-time equivalent positions, or full-time
    equivalents. But in order to hold our requested increase to 1.9
    percent, we would reduce spending on automated data processing
    [ADP] and on printing and postage by a total of $542,000.
        Although we should be able to maintain our current workload
    with the funds requested here, I would like to point out that
    the law dealing with unfunded mandates as well as the
    Congressional Accountability Act will continue to have a
    significant cost impact on our budget.
        CBO has now had a full year of operation under the Unfunded
    Mandates Act, and the cost of carrying out its responsibilities
    has become clearer. Both our fiscal year 1997 and fiscal year
    1998 budgets are based on the assumption that the required
    level of work on mandates will decline somewhat after the first
    year. But in view of the pace of work, that assumption could be
    optimistic.
        Moreover, a number of legislative proposals have been made
    for expanding the scope of work on mandates, and, of course,
    that could cause a significant diversion of resources from our
    basic work.
        As for the Congressional Accountability Act, CBO used an
    estimated two full-time equivalents in staff and $320,000 to
    assure compliance in fiscal 1996. No additional staff or funds
    were provided for that purpose. For fiscal years 1997 and 1998,
    we estimate that a similar level of effort will be required.
    That cost is also being absorbed. Of course, estimating how
    much it will cost annually to comply with the act beyond 1996
    is extremely difficult.
        Mr. Chairman, given our role in the budget process, we are,
    of course, very aware of Congress' intention to balance the
    budget and downsize the Federal Government, including the
    legislative branch. However, maintaining a strong analytical
    capability in the Congressional Budget Office is essential, I
    believe, to helping achieve those goals.
        Our request is for less than is necessary to maintain our
    budget at its current services level. I think it is a prudent
    budget in which we absorb over 50 percent of our mandatory pay
    and benefit increases by making reductions elsewhere.

                               prepared statement

        We believe that our requested increase of 1.9 percent would
    allow us to serve the Congress at the level it has come to
    expect of us. I would be happy to answer any questions you may
    have right now or in writing and will submit our complete
    prepared testimony for the record.
        [The statement follows:]
                     Prepared Statement of June E. O'Neill
        Mr. Chairman and Members of the Subcommittee, I am pleased to
    present the fiscal year 1998 budget request for the Congressional
    Budget Office (CBO). The mission of CBO is to provide the Congress with
    the objective, timely, nonpartisan analysis needed for economic and
    budget decisions and the information and estimates required for the
    Congressional budget process. CBO does not make policy recommendations
    but presents the Congress with options and alternatives in a wide range
    of subjects, all of which have economic and budgetary impacts.
        Our fiscal year 1998 request is for $24,995,000, a 1.9 percent
    increase--$463,000--over our fiscal year 1997 appropriation of
    $24,532,000. That requested level would fund 232 full-time-equivalent
    positions (FTE's), our current staff ceiling. No additional staff is
    requested. Our requested increase is about half of the 4 percent
    increase that would be needed to maintain CBO's budget at the fiscal
    year 1997 current-services level. CBO is able to hold its overall
    request to 1.9 percent by cutting back on the number of reports and
    studies to be published in fiscal year 1998, which will lower printing
    and postage costs, and by reducing spending for automated data
    processing (ADP) systems, data, and model development and for ADP
    hardware.
        At the requested level, CBO's fiscal year 1998 budget remains--in
    real terms--below the amount that would be required to restore our real
    resources to their fiscal year 1988 level. In the meanwhile, CBO's
    staff ceiling has been increased by six positions since 1988, and its
    duties expanded by legislation numerous times.
        Over the years, CBO has taken a number of steps to absorb the cuts
    in real resources it has experienced, including holding down salaries
    when turnovers occur; continuing our efforts to reduce administrative
    expenses, especially in the areas of report production, distribution,
    and storage; and, aggressively renegotiating contract terms for ADP and
    other administrative services. We have been aided further in our
    efforts to absorb cuts in real resources over the years by a steady
    decline in the cost of computing power.
        Before discussing our fiscal year 1998 request in more detail, I
    would like to describe for the Committee two major new CBO work efforts
    of the past fiscal year.
                       major new work efforts during 1996
        CBO undertook two new major efforts during the past year. One was
    to develop estimates of the costs of federal mandates imposed on state
    and local governments and on the private sector in new legislative
    proposals. The other was to prepare long-term budget projections to
    show the increased pressures on the federal budget after 2010 that will
    come with the retirement of the baby-boom generation and the aging of
    the U.S. population.
    Federal Mandate Cost Statements
        On January 1, 1996, the Unfunded Mandates Reform Act of 1995 (UMRA)
    took effect. The act established new procedures designed to ensure that
    the Congress fully considers the potential effects of unfunded federal
    mandates before imposing them on state, local, and tribal governments
    or the private sector. Among the new procedures, CBO is required to
    provide statements to authorizing committees about whether reported
    bills contain mandates and, if so, their estimated costs.
        In carrying out its new responsibilities under the act last year,
    CBO used an estimated 24 work years of staff effort. CBO's
    appropriation for 1996 provided funds for 13 additional staff
    positions, and we reallocated an additional 11 staff years of effort
    from other work. Originally, we estimated that we would need 25 work
    years of staff effort to carry out our new duties, based on an
    assumption that we would have to prepare 550 intergovernmental and 550
    private-sector mandate analyses.
        In fact, we transmitted to the Congress last year 718
    intergovernmental and 673 private-sector mandate cost statements, using
    about the level of resources expected. Among the proposals analyzed, 69
    contained intergovernmental mandates and 91 included private-sector
    mandates. Of those, 11 intergovernmental and 38 private-sector mandates
    had costs exceeding the thresholds established in the Unfunded Mandates
    Reform Act.
        Earlier this year, CBO completed a report analyzing its first year
    of operation under UMRA titled ``The Experience of the Congressional
    Budget Office During the First Year of the Unfunded Mandates Reform
    Act.'' I would like to provide copies of the report for the Committee's
    information.
    Long-Term Budget Projections
        CBO's annual report to the Congress on the economic and budget
    outlook last year included a chapter that looked at the budget through
    the first half of the 21st century and the implications of the
    retirement of the baby-boom generation. Together with CBO's work on
    unfunded mandates, the long-term budget projections constituted a
    second major analytic effort by CBO last year.
        For the past several years, CBO has been preparing 10-year budget
    projections of current laws and policies to serve as a baseline in
    considering the budgetary effects of new policy proposals. A 10-year
    time frame, however, is not sufficient to show the dramatic effects on
    the federal budget of projected long-term demographic changes in the
    U.S. population. To illustrate those future pressures, CBO prepared
    some long-term budget projections to 2050, using a standard model of
    economic growth and the actuarial projections used by Social Security
    and Medicare trustees.
        The longer-term CBO projections showed that the federal deficit
    would begin to mount rapidly after 2010 under current budget policies.
    A sharply rising federal deficit would have adverse consequences for
    interest rates and economic growth, making the budget and economic
    outlook bleaker. The growth in federal spending over the period was
    largely in Medicare and Social Security, and CBO included a special
    chapter in its annual report, ``Reducing the Deficit: Spending and
    Revenue Options'' (August 1996), that discussed various options for
    limiting the long-term growth of outlays for those programs. Because we
    believe that analysis to be significant, this spring we published it as
    a stand-alone report titled ``Long-Term Budgetary Pressures and Policy
    Options'' (March 1997).
    Other CBO Work
        As in other years, CBO maintained its normal support of the
    Congressional budget and legislative processes throughout the fiscal
    year, performing cost estimates for hundreds of bills, as well as
    maintaining a steady flow of scorekeeping reports to the Appropriations
    Committees. CBO's divisions published 20 reports in fiscal year 1996,
    and CBO staff members testified 18 times before 11 Congressional
    committees last year, demonstrating the broad range of its analytic
    expertise. Appendix A to this statement provides an overview of CBO's
    work for the Congress under current law in fiscal year 1996.
        Also, I should note that CBO has new responsibilities under the
    Line Item Veto Act, beginning January 1, 1997. Although the work
    required will not be nearly as demanding as that required by UMRA, each
    time the President exercises his authority under the act, CBO is
    required to provide the Budget Committees with an estimate of the
    reductions in budget authority and outlays stemming from the
    President's action. CBO will prepare any additional information that
    the Budget and Appropriations Committees may need to track the effects
    of the new law.
                            fiscal year 1998 request
        As I indicated previously, Mr. Chairman, CBO's fiscal year 1998
    request is for $24,995,000, an increase of 1.9 percent, or $463,000,
    over our fiscal year 1997 appropriation. That request funds our staff
    ceiling of 232 full-time-equivalent positions. No additional positions
    are being requested. Specifically, our request includes:
      --$938,000 in mandatory pay increases, the major components of which
            are: (a) $424,000 for a projected 2.8 percent employment cost
            index (ECI) adjustment on January 1, 1998; (b) $295,000 for the
            annualization of fiscal year 1997 pay raises; and (c) $198,000
            for merit increases, budgeted at 4 percent of salaries, with 50
            percent of the cost offset by savings from staff turnover.
      --$67,000 in various price increases, from printing to ADP
            timesharing;
      --A $334,000 reduction in planned spending for ADP timesharing and
            systems, data, and model development and for lower printing and
            postage costs; and
      --A $208,000 reduction in spending for equipment, primarily ADP
            hardware and software.
        The request is lower than the roughly $25.5 million that would be
    necessary to maintain our budget at the current-services baseline
    level, which would require an increase of 4 percent. To limit our
    request below that level, we have partially offset combined mandatory
    pay and benefit increases and general price increases of $1,005,000
    with reductions in ADP spending and in our printing and postage budget
    amounting to $542,000.
        In our budget, more than 85 percent of the total constitutes
    personnel costs. Of the cost increases CBO faces in fiscal year 1998,
    over 93 percent are mandatory increases associated with pay and
    benefits. CBO has carefully scrubbed other parts of its budget to
    absorb more than half of the increases, cutting ADP spending 12.2
    percent and administrative spending 10.1 percent. At 8.3 percent of
    CBO's budget, ADP spending is at a historic low. Moreover,
    administrative expenses--6.6 percent of the total budget--are well
    below their historic average. As a result, those areas of spending
    cannot be counted on to yield similar savings on an annual basis in the
    future, even though mandatory costs will continue to rise.
        Although CBO should be able to maintain its current workload with
    the funds requested here, it is important to point out that the law
    dealing with unfunded mandates and the Congressional Accountability
    Act, both high priorities for the Congress, will continue to have a
    significant cost impact for our budget.
        CBO now has had a full year of operation under the Unfunded
    Mandates Act, and the costs of carrying out its responsibilities under
    the act are becoming more clear. Expecting that the level of work
    effort will fall somewhat after the first year, both the fiscal year
    1997 and fiscal year 1998 budgets assume seven FTE's and more than
    $600,000 in costs above the base provided by the Congress for our work
    on unfunded mandates. Considering the pace of work on unfunded mandates
    last year, however, even that estimate could prove too low.
    Furthermore, a number of legislative proposals have been made for
    expanding our work duties on mandates, which could cause an even
    greater diversion of our analytic efforts from our basic budget work.
        The number of analytic studies we provided to the Congress last
    year was sharply reduced. Part of the slowdown in the production of
    programmatic analyses was the result of diverting analysts from doing
    in-depth analysis of various budget issues to the more immediate
    requirements of work on unfunded mandates.
        Over the years, CBO's analytic reports produced by our program
    divisions have helped to provide committees with important information
    on legislative options and alternatives to current policies.
    Subsequently, as committees reported legislation incorporating
    alternatives analyzed by CBO, our cost estimates for the proposed
    legislation often relied on the methodologies developed by the program
    divisions. By diverting analysts away from long-term programmatic work
    to attend to unfunded mandates duties, CBO may one day be unable to
    perform policy analysis for committees in a timely fashion during the
    legislative process. Subsequently, that lack of research may have an
    effect on the quality of CBO's cost estimates of bills.
        As for the Congressional Accountability Act, CBO used an estimated
    two FTE's and $320,000 to assure compliance in fiscal year 1996. No
    additional staff or funds were provided for that purpose. For fiscal
    years 1997 and 1998, we estimate that a similar level of effort will be
    required. That cost is also being absorbed. Of course, estimating how
    much it will cost annually to comply with the act beyond 1996 is
    extremely difficult. In addition to the ongoing cost of compliance,
    another possible cost component exists that depends on the number of
    employee disputes and whether any result in lawsuits. A lawsuit would
    not only incur significant legal expenses but also disrupt CBO's work
    while management and administrative staff met with lawyers, provided
    needed documentation, and testified.
        At this point, I would like to discuss two specific and important
    administrative concerns. The first has to do with attracting and
    retaining a high-quality workforce. As we pointed out to the Committee
    last year, the restrictions on compensation that CBO has faced in
    recent years--the same restrictions the Congress itself has faced--have
    already affected our ability to attract and retain highly qualified
    staff. During the last two years, CBO has experienced an unusually high
    turnover among its most skilled staff and managers, who have left to
    take more lucrative positions. If the pay freeze for Members of
    Congress and other senior level positions continues, which is likely,
    it will exact a heavy toll on CBO's managers and senior staff.
        The executive branch, and even some other legislative branch
    agencies, use several options for compensation, such as bonuses and
    locality pay. However, those options are not available to CBO. As a
    result, we are at a serious competitive disadvantage with both the
    private sector and other governmental agencies. CBO is in danger of
    losing employees with years of institutional knowledge--staff members
    who have helped to shape CBO's products and to train new staff members.
    That situation has implications for the quality of CBO's service in the
    future.
        Our second concern has to do with the ADP services that are
    currently being provided to us by House Information Resources (HIR).
    CBO does a sizable amount of computing on HIR's mainframe on a
    reimbursable basis. However, we have recently learned that HIR is
    reviewing a ``Mainframe Computer Retirement'' plan that could have
    serious implications and consequences for the Congressional Budget
    Office. If this service to CBO is terminated without ample notice, it
    will have an adverse effect on our ability to meet Congressional demand
    for CBO's products and even on our ability to operate. To address that
    concern, we intend to explore the ramifications on CBO's budget and
    operations of moving to outside vendors in the event HIR curtails its
    service to CBO.
        Finally, let me update the Committee on CBO's efforts to
    accommodate those interested in receiving our work products in
    electronic format. For a number of years, CBO has maintained a gopher
    site on the Internet. At that site, people can get copies of CBO's
    published reports in electronic format, either in Word Perfect or
    ASCII. In the short time that we have been offering that service, a
    revolution has occurred on the Internet. File transfer protocol sites
    like our gopher site are now obsolete, and Internet users have moved on
    to the graphically oriented and more interactive World Wide Web. CBO,
    which was once out front in terms of the electronic distribution of its
    material, is now trying to catch up.
        Sometime this fiscal year, CBO expects to move the electronic
    distribution of its documents from its gopher site to the World Wide
    Web. Once we have established a web site, we intend to offer not just
    our published documents--which are basically all we currently offer on
    our gopher site--but all of CBO's work products, at least eventually.
    We are closely coordinating our efforts with those who are developing
    the Legislative Information System for the Congress, and CBO's site
    will be fully integrated with that system when both are completed.
                                   conclusion
        Mr. Chairman, no agency is more keenly aware than CBO of the
    Congress's intention to balance the budget and downsize the federal
    government, including the legislative branch. However, maintaining a
    strong analytic capability in the Congressional Budget Office is
    essential to achieving those goals. Our request is for less than is
    necessary to maintain our budget at the current-services level. It is a
    prudent budget in which we absorb over 50 percent of our mandatory pay
    and benefit increases with reductions elsewhere. We do believe,
    however, that our requested increase of 1.9 percent would allow us to
    continue to serve the Congress at the level it has come to expect.
                                     ______

     Appendix A.--Major Responsibilities of the Congressional Budget Office
        The Congressional Budget Office (CBO) was created by the
    Congressional Budget and Impoundment Control Act of 1974 (Public Law
    93-344) and began operations on February 24, 1975, with the appointment
    of Director Alice M. Rivlin. Its mission, then as now, is to provide
    the Congress with economic and budgetary information. Compared with the
    missions of the Congress's other support agencies--the Congressional
    Research Service and the General Accounting Office--CBO's mandate is
    relatively narrow. But its subject matter is extremely broad,
    reflecting the extensive array of activities that the U.S. budget
    covers and the major role the budget plays in the national economy.
        A substantial part of what CBO does is to support the work of the
    two other Congressional institutions created by the 1974 Budget Act: a
    Committee on the Budget in both the House of Representatives and the
    Senate, each with its own staff. Those committees are in charge of the
    process, spelled out in the Budget Act, by which the Congress sets its
    own targets for the federal budget, including the overall levels of
    revenues and spending, the surplus or deficit that results, and the
    distribution of federal spending by broad functional categories. Each
    spring the Congress adopts the result of that process, the
    Congressional budget plan, in the form of a concurrent resolution. The
    resolution imposes an overall framework and discipline on the way
    appropriations, other spending measures, and tax legislation are
    passed.
        The policies and principles that have shaped CBO since its
    inception are key factors in its effectiveness. CBO is a professional,
    nonpartisan staff office; it does not make recommendations on policy.
    This nonpartisan stance has been instrumental in preserving the
    agency's reputation for professionalism and has enhanced the
    credibility of its products. CBO prepares independent analyses and
    estimates relating to the budget and the economy, and it also presents
    options and alternatives for the Congress to consider. It routinely
    discloses the assumptions and methods it uses, which enhances the
    general perception of CBO's products as objective and impartial.
        Some of CBO's activities are statutory tasks; others are carried
    out at the request of Congressional committees. According to the Budget
    Act, CBO must give priority first to requests for services from the
    House and Senate Budget Committees; second, to requests from the two
    Appropriations Committees, the House Committee on Ways and Means, and
    the Senate Committee on Finance; and finally, to requests from all
    other Congressional committees. CBO prepares various types of analyses
    for the Congress, including cost estimates for bills that individual
    Members have introduced or plan to introduce. But committee requests
    always have priority; CBO handles requests from individual Members only
    to the extent that its resources permit.
        CBO's services can be grouped into four categories: helping the
    Congress formulate a budget plan, helping it stay within that plan,
    helping it assess the impact of federal mandates, and helping it
    consider issues related to the budget and to economic policy.
               helping the congress develop a plan for the budget
        The House and Senate Budget Committees prepare the annual
    Congressional budget plan, drawing on the views and estimates of the
    other committees. A major part of CBO's role in this process is to
    prepare an annual report, divided into two volumes. The first volume
    provides economic forecasts and budget projections for a multiyear
    period, currently 10 years. Typically, it also includes a discussion of
    a current economic or budget policy issue, such as the chapter on the
    economic and budgetary implications of balancing the budget in the most
    recent report. The second volume is a collection of spending and
    revenue options for reducing the budget deficit. The current edition of
    this volume--the 18th we have done--was published in March. CBO
    customarily updates its economic and budget projections in mid-August.
    Economic Forecasts and Projections
        CBO is the only entity of the legislative branch whose mandate
    includes making economic forecasts and projections. Its forecasts cover
    18 to 24 months (it does not attempt to forecast cyclical fluctuations
    in the economy more than two years ahead) and involve the major
    economic variables--gross domestic product, unemployment, inflation,
    and interest rates. Its ten-year projections of the economy present a
    longer-term view based on trends in the labor force, productivity, and
    saving.
        In preparing its forecast, CBO consults the major econometric
    models and commercial economic forecasting services, as well as the
    expertise of its staff. The models currently available to CBO represent
    a broad range of assumptions about how the economy works; they include
    Data Resources, Inc.; the Macroeconomic Advisers Model; the MSG
    multicountry model, developed by Warwick McKibbin and Jeffrey Sachs;
    and a standard growth model developed at CBO. CBO also relies on the
    advice of a distinguished panel of economic advisers (see Appendix B).
    Usually, CBO's forecasts are fairly close to the Blue Chip consensus of
    private forecasters.
    Baseline Budget Projections
        The purpose of CBO's biannual budget projections is to give the
    Congress a baseline for measuring the effects of proposed changes in
    taxing and spending laws. The projections start with the Congress's
    most recent budgetary decisions and show what would happen to the
    federal budget if no new policy decisions were made over the projection
    period. The budget committees use those projections to develop annual
    budget resolutions and directives to other committees. CBO uses them to
    produce cost estimates for proposed legislation and in scorekeeping
    tabulations (described later).
        For revenues and entitlement programs, such as Social Security or
    Medicare, the baseline projections generally assume that current laws
    will continue without change. For discretionary spending, the
    projections are based on the most recently enacted appropriation bills
    or on any statutory spending limits that may be applicable.
        CBO's projections do not represent a forecast of future budgets
    because the Congress makes numerous policy decisions in response to
    changing national needs and economic circumstances. A longer-term
    framework is helpful in making annual budget choices because those
    decisions sometimes have little impact on the budget in the short run
    but significantly influence relative budget priorities over a period of
    several years.
        CBO's capability to do budget projections has enabled the Congress
    to move increasingly in the direction of multiyear budgeting. In the
    past, both budget committees have used CBO's baseline budget
    projections as a starting point for formulating their recommendations
    for the annual budget resolution. CBO's baseline spending projections
    are distributed to the appropriations committees and the authorizing
    committees as background information for preparing their ``views and
    estimates'' reports to the budget committees. The budget committees
    then use the CBO baseline projections in their markup materials for the
    budget resolution to assess how spending and revenues should be altered
    in the future to meet fiscal policy goals and national needs.
    Deficit Reduction Options
        The most widely distributed of all CBO publications is the volume
    of deficit reduction options that the agency prepares as part of its
    annual report. The volume discusses various strategies for reducing the
    deficit and offers more than 200 specific spending and revenue options
    for the Congress to consider. Members of Congress, as well as many
    outside groups, use the report to develop deficit reduction proposals
    and to educate the public about the difficult choices that must be
    made. Over the years, this report has become a standard reference for
    developing deficit reduction plans and has been relied on heavily by
    both budget committees in developing the budget resolution each year.
        The policy options included in this report come from many sources,
    and most have been considered by the Congress at some time. In
    accordance with CBO's mandate to provide objective and impartial
    analyses, the discussion of each option presents the cases for and
    against it as fairly as possible. CBO does not endorse the options
    included, nor does exclusion of any proposal imply a recommendation.
    All divisions of the Congressional Budget Office contribute to this
    report.
    Analysis of the President's Budget and Other Assistance
        Each year, at the request of the Senate Committee on
    Appropriations, CBO analyzes the President's budget to see how its
    revenue and spending proposals would affect the projections. In the
    analysis, CBO uses its own economic assumptions and estimating
    techniques to recast the budget that the President has proposed and
    submitted to the Congress. To keep those techniques and methods as
    accurate as possible, CBO staff carefully monitor both actual spending
    trends, as reported monthly by the Treasury, and various program data
    series that provide information on recent trends in the use of federal
    benefits and services, the growth in beneficiaries, and other factors
    affecting federal spending. CBO uses those independent methods to
    reestimate the effect of the President's budgetary proposals. In some
    years, those so-called economic and technical reestimates have been
    significant.
        In addition, as the Congress moves toward adopting its annual
    budget resolution, CBO helps the budget committees and other committees
    estimate the effects of alternative budget plans. Frequently, the
    agency is asked to testify before Congressional committees about the
    outlook for the economy and the budget and about other matters related
    to developing the annual budget plan. Finally, the Congressional Budget
    Act of 1974 requires CBO each year to provide the Congress with a
    report on unauthorized appropriations and expiring authorizations. This
    year, that report was filed with the Congress on January 15.
                helping the congress stay within its budget plan
        Once the Congress adopts the annual budget resolution, the budget
    committees take the lead in enforcing its provisions. To help them with
    that work, CBO supplies estimates of the budgetary impact of bills
    reported by the different committees and up-to-date tabulations of the
    status of Congressional actions on legislation affecting the budget.
    CBO also prepares a series of sequestration reports that advise the
    Congress and the Administration on two matters: whether the
    appropriation limits for discretionary spending established by the
    Balanced Budget and Emergency Deficit Control Act of 1985 have been
    exceeded, and whether the enactment of any direct spending or receipt
    legislation has increased the budget deficit.
    Cost Estimates for Bills
        CBO is required to develop cost estimates for virtually every bill
    reported by Congressional committees to show how those legislative
    proposals would affect spending or revenues over the next five years.
    For most tax legislation, CBO uses estimates provided by the Joint
    Committee on Taxation, a separate analytic group that works closely
    with the two tax-writing committees. CBO also prepares cost estimates
    for use in drafting bills (especially in the early stages), for
    formulating floor amendments, and for working out the final form of
    legislation in conference committees. To the extent that its resources
    permit, CBO provides estimates of the cost of bills in response to
    requests by individual Members.
        CBO's cost estimates have become an integral part of the
    legislative process, and committees increasingly refer to them at every
    stage of bill drafting. The estimates may also have an impact on the
    final outcome of legislation because they are used to determine whether
    committees are complying with the annual budget resolutions and
    reconciliation instructions.
        The number of such cost estimates varies each year, depending on
    the amount of legislation being considered and reported by legislative
    committees. In 1996, CBO prepared 652 federal cost estimates, as shown
    in Table 1. A large part of CBO's bill costing in certain years has
    been for the House and Senate committees receiving reconciliation
    instructions in the budget resolution. CBO's system for tracking cost
    estimates has treated work on the reconciliation proposals as if they
    were a few large bills. Work on a reconciliation bill alone is often
    equivalent to 100 or more bill cost estimates. That was particularly
    true last year when CBO worked closely with a number of committees in
    evaluating the savings from the large number of options that were
    considered for reforming welfare.

                               TABLE 1.--NUMBER OF FEDERAL COST ESTIMATES PREPARED BY CBO
    ----------------------------------------------------------------------------------------------------------------
                                                       1989    1990    1991    1992    1993    1994    1995    1996
    ----------------------------------------------------------------------------------------------------------------
    Cost Estimates..................................     628     855     638     733     603     622     517     652
    ----------------------------------------------------------------------------------------------------------------

        In addition to the cost estimates for bills that the legislative
    committees report, CBO provides the appropriations committees with
    estimates of outlays for all appropriation bills. Those estimates are
    prepared for each appropriation account and are transmitted to the
    staffs of the committees largely in the form of computer tabulations.
    For example, many reports display data on both budget authority and
    outlays in the Comparative Statement of Budget Authority formats that
    the appropriations committees use. CBO's estimates may be critical in
    determining whether the legislation complies with allocations in the
    annual budget resolution and with statutory limits on discretionary
    appropriations.
    Scorekeeping
        One of CBO's most important functions is to keep track of all
    spending and revenue legislation considered each year, so that the
    Congress can know whether it is acting within the limits set by the
    annual budget resolutions. CBO provides the budget and appropriations
    committees with frequent tabulations of Congressional action on both
    spending and revenue bills.
        The bulk of CBO's scorekeeping activities involve spending actions.
    The spending side of the federal budget is complex, consisting of more
    than 1,000 separate accounts. Furthermore, the Congress acts each year
    on a large number of individual legislative bills that affect spending,
    including 13 appropriation bills. CBO's scorekeeping system tracks
    Congressional action on all of those bills from the time they are
    reported from committee to their enactment into law. As a result, the
    CBO scorekeeping database for budget authority and outlays is extremely
    complex, and keeping it current represents a major effort. That effort
    is all the more intense now that caps have been placed on discretionary
    appropriations and a pay-as-you-go requirement has been placed on
    mandatory spending and receipts.
        CBO's scorekeeping estimates are derived from its analysis of the
    President's budget, baseline budget projections, and bill cost
    estimates, as well as from the economic assumptions used for the
    concurrent budget resolution. CBO conducts a comprehensive review of
    its scorekeeping estimates at least twice a year to determine how its
    projections fit with actual fiscal activity. It incorporates new
    information provided by the Office of Management and Budget (OMB) and
    other federal agencies and any revised economic assumptions that the
    budget committees may adopt in addition to other relevant data.
        Specially designed computer scorekeeping reports are provided
    weekly--and sometimes daily--to the budget and appropriations
    committees. Frequent letters are also sent to the chairmen of the two
    budget committees to advise them on current budgetary levels. In
    addition, advisory letters have been sent on request to the chairmen of
    the Senate and House Appropriations Committees on the budgetary impact
    of individual appropriation actions, such as a supplemental
    appropriation bill or a continuing resolution. CBO's automated
    scorekeeping database also provides special computer reports to the
    appropriations committees to use in preparing their ``views and
    estimates'' reports due on February 25, and in dividing the allocations
    from the budget resolution among subcommittees.
        CBO also prepares a weekly report on the legislative status of
    selected entitlement legislation and other bills that would directly
    affect budgetary requirements. Similar reports contain information on
    the legislative status of bills providing authorizations for
    appropriations and proposed revisions of the Congressional Budget Act
    of 1974. Copies of those reports are provided to the staffs of the
    appropriations and budget committees of both Houses.
        Revenue scorekeeping reports with bill-by-bill detail are sent
    biweekly, or as needed, to the staffs of the Ways and Means, Finance,
    and Budget Committees. The reports provide five-year estimates of the
    revenue effects of each tax bill in the legislative process and compare
    the cumulative revenue effects of enacted legislation with the targets
    set in the budget resolution. The revenue estimates shown in the
    reports are drawn from CBO cost-estimate letters and are furnished to
    the tax-writing committees when each tax bill is reported.
    Sequestration Reports
        Each year, CBO prepares three sequestration reports as part of the
    enforcement procedures specified by the Balanced Budget Act. Those
    reports are advisory and serve only as a benchmark for judging the
    accuracy of similar sequestration calculations made by the Office of
    Management and Budget. Under the law, OMB can trigger the cancellation
    of budgetary resources when the limits on discretionary appropriations
    are breached or when direct spending and receipt legislation increases
    the deficit. Those provisions apply through fiscal year 1998.
        In addition to the sequestration reports, the Balanced Budget Act
    specifies another task: CBO must notify the Congress whenever it or OMB
    projects a recession in the next year (defined as two consecutive
    quarters of less-than-zero real economic growth) or the Department of
    Commerce reports two consecutive quarters of real economic growth of
    less than 1 percent. If the President concurs, the Congress can then
    elect to set aside the statutory appropriation limits and other budget
    enforcement procedures.
                  helping the congress assess federal mandates
        To better assess the impact of its laws on state, local, and tribal
    governments and the private sector, the Congress passed the Unfunded
    Mandates Reform Act of 1995. The act amends the Congressional Budget
    Act to require CBO to give authorizing committees a statement about
    whether reported bills contain federal mandates. If the five-year
    direct costs of an intergovernmental or private-sector mandate exceed
    specified thresholds, CBO must provide an estimate of those costs (if
    feasible) and the basis of that estimate.
        CBO's statement must also include an assessment of what funding is
    authorized in the bill to cover the costs of the mandates and, for
    intergovernmental mandates, an estimate of the appropriations needed to
    fund such authorizations for up to 10 years after the mandate is
    effective. When requested, CBO is also required to assist committees by
    preparing studies of legislative proposals containing federal mandates.
    The law took effect January 1, 1996.
        helping the congress consider budget and economic policy issues
        CBO's responsibilities also entail analyzing specific program and
    policy issues that affect the federal budget and the economy. For the
    most part, requests for those analyses come from the chairman or
    ranking minority member of a full committee or subcommittee. The
    leadership of either party in the House or Senate may also request a
    CBO analysis. The analyses cover a variety of federal activities such
    as examining current policies, suggesting other approaches, and
    projecting how the alternatives would affect current programs, the
    federal budget, and the economy. In keeping with its nonpartisan
    mandate, CBO does not offer recommendations on policy in those studies.
        Some studies may take 9 to 12 months, or sometimes longer, to
    complete. Other analyses may be conducted in a much shorter time frame,
    appearing as CBO papers or memorandums. Many CBO publications have
    helped to shape public discussion of the issues they address, not only
    on Capitol Hill but in the nation at large. Over the years, CBO has
    responded to requests for analyses of key program issues from almost
    every committee of both Houses of Congress. The following discussion
    demonstrates the range of issues addressed in the agency's
    publications. Included in the discussion is an illustrative list of
    reports issued by CBO during fiscal year 1996.
    U.S. Economic and Fiscal Policy
        CBO has published a number of analyses of macroeconomic issues
    related to economic growth and other topics. Many of those studies are
    based on simulations that use computer models of the economy. The
    following reports were among those completed last fiscal year on
    macroeconomic issues: ``Labor Supply and Taxes'' (January 1996); ``Who
    Pays and When? An Assessment of Generational Accounting'' (November
    1995); and ``CBO's Method for Estimating Potential Output'' (October
    1995).
    Federal Taxes
        CBO's analyses of the U.S. tax system have explored the effects of
    taxes on taxpayer behavior and how changes in current tax laws or the
    enactment of new taxes may affect taxpayers and the budget. Reports
    published last fiscal year include: ``Incidence of the Corporate Income
    Tax'' (March 1996); ``Projecting Capital Gains Realizations'' (November
    1995); and ``The Growth of Federal User Charges: An Update'' (October
    1995).
    Natural Resources and Commerce
        CBO's policy analyses in the areas of natural resources and
    commerce cover agriculture, energy, the environment, industry and
    trade, transportation, public works infrastructure, and research and
    technology. The range of those efforts in fiscal year 1996 is indicated
    by the studies listed below: ``Emerging Electronic Methods for Making
    Retail Payments'' (July 1996); ``How the Medicaid Rebate on
    Prescription Drugs Affects Pricing in the Pharmaceutical Industry''
    (December 1995); and ``High-Tech Highways: Intelligent Transportation
    Systems and Policy'' (October 1995).
    Health and Human Resources
        A number of CBO studies have examined the rising cost of health
    care in the United States and the expansion of health insurance
    coverage. These studies have dealt with both federal health care
    programs (Medicare and Medicaid) and national health care issues. CBO's
    analyses have also treated other topics within the framework of human
    resources and social services, including education, employment and
    training, housing, and community development. The following reports of
    this type were sent to the Congress last fiscal year: ``An Analysis of
    Alternative Child Support Assurance Programs'' (April 1996); and ``The
    High-Deductible/MSA Option Under Medicare: Exploring the Implications
    of the Balanced Budget Act of 1996'' (March 1996).
    National Security
        Military manpower, strategic forces, general-purpose forces, and
    other programs of the Department of Defense are some of the subjects of
    CBO's analyses related to national security. The studies examine the
    costs, other economic effects, and strategic significance of current
    defense programs, proposed legislation, and alternative programs of
    interest to Congressional committees. Publications in fiscal year 1996
    included: ``Bonuses for Nuclear-Trained Officers in the Navy: Current
    Programs and Alternatives'' (September 1996); ``Improving the
    Efficiency of Forward Presence by Aircraft Carriers'' (August 1996);
    ``The Cost of Expanding the NATO Alliance'' (March 1996); ``An Analysis
    of U.S. Army Helicopter Programs'' (January 1996); and ``Military Pay
    and the Rewards for Performance'' (December 1995).
    Budget Concepts and Processes and General Government
        Periodically, the Congress asks CBO to analyze concepts and
    procedures related to the federal budget--both the process and budget
    accounting--as well as general government and personnel issues. Those
    studies have included the budgetary treatment of credit and insurance
    programs and the risks posed to the federal government by government-
    sponsored enterprises. Listed below are similar studies completed in
    1996: ``Changes in Federal Civilian Employment'' (July 1996);
    ``Assessing the Public Cost and Benefits of Fannie Mae and Freddie
    Mac'' (May 1996); and ``Mandatory Spending Mechanisms'' (February
    1996).
                                     ______

                    Appendix B.--Panel of Economic Advisers
        Dr. Robert J. Barro, Professor of Economics, Harvard University.
        Dr. Michael Boskin, Professor of Economics, Hoover Institute,
    Stanford University.
        Dr. Barry P. Bosworth, Senior Fellow, The Brookings Institution.
        Dr. Robert Dederick, Economic Consultant, The Northern Trust
    Company.
        Dr. Rudiger Dornbusch, Professor of Economics, Massachusetts
    Institute of Technology.
        Dr. Martin Feldstein, President, National Bureau of Economic
    Research.
        Dr. Robert J. Gordon, Professor of Economics, Northwestern
    University.
        Dr. Lyle E. Gramley, Consulting Economist, Mortgage Bankers
    Association of America.
        Dr. Robert E. Hall, Hoover Institution, Stanford University.
        Dr. Marvin Kosters, Resident Scholar, American Enterprise
    Institute.
        Dr. Anne Krueger, Professor of Economics, Stanford University.
        Dr. N. Gregory Mankiw, Professor of Economics, Harvard University.
        Dr. Allan Meltzer, University Professor, Graduate School for
    Industrial Administration, Carnegie-Mellon University.
        Dr. Rudolph Penner, Director, Economic Studies, KPMG Peat Marwick.
        Dr. James Poterba, Professor of Economics, Massachusetts Institute
    of Technology.
        Dr. Robert Reischauer, Senior Fellow, The Brookings Institution.
        Dr. Sherwin Rosen, Professor of Economics, University of Chicago.
        Dr. Joel Slemrod, Professor of Economics, University of Michigan.
        Dr. John Taylor, Professor of Economics, Stanford University.
        Dr. James Tobin, Sterling Professor Emeritus, Cowles Foundation for
    Research in Economics, Yale University.

                      reductions in ADP and other spending

        Senator Bennett. Thank you very much.
        Let me talk for just a minute about the reduction in
    computer data and processing-related spending. Is this
    reduction because of efficiencies that you are getting as a
    result of computers that you installed in prior years?
        Ms. O'Neill. It is partly that and partly because we have
    been very aggressive in pursuing different contractual
    arrangements and in doing more and more of our work in ways
    that are more parsimonious. In addition, we have been able to
    take advantage of declining computer costs.
        At the same time, we have been trying to expand our public
    service by installing an up-to-date web site, which should be
    in place pretty soon. We hope that will make our work available
    to many, many people who would not have had access to it
    before.
        Senator Bennett. Do you think it will cut costs, and that
    people will be satisfied with the information they get?
        Ms. O'Neill. There may not be an actual dollar savings,
    because the audience will be larger.
        Another way we have saved in the past is by postponing some
    work that would have involved additional outside contracts to
    provide data of one kind or another. We have been able to do
    that. Eventually that comes to an end though.

                      changes in CBO's revenue projections

        Senator Bennett. I would give you an opportunity to put on
    this record what you have said elsewhere. During the budget
    negotiations, an additional $225 billion over 5 years was spent
    as a result of your interim reports. Some people have accused
    you of responding to political pressures where the negotiator
    said, would it not be wonderful if we had this additional
    money. I am not one of those who so accused you, and would give
    you the opportunity now to explain for the record exactly what
    happened.
        Ms. O'Neill. The money was not actually found. It was
    simply not anticipated by us when we prepared our annual
    report.
        Every month we track receipts based on monthly Treasury
    reports, and in addition to that we follow daily accounts of
    what is happening with receipts, particularly in April. We then
    prepare a monthly report for the Budget Committees on our
    findings.
        A month prior to our report in April, we had noted that
    receipts had come in higher than anticipated, and if that was
    extrapolated through the end of the fiscal year, it would
    produce a significantly lower deficit than the $112 billion we
    had been estimating for 1997. Specifically, $10 billion extra
    had come in through March in withheld receipts.
        During the month of April--which is the heaviest tax
    receipt month, understandably--we follow receipts on a daily
    basis. Starting around April 15, money begins coming in from
    the April 15 tax filings. As it turned out, $25 billion more
    came in during the month of April than expected, so added to
    the extra in March, that already brought receipts to $35
    billion above what we had been estimating would come in for
    1997.
        It seemed to us perfectly plausible that an additional $10
    billion would come in over the remaining months of 1997.
    Putting that together gets you to an additional $45 billion.
        That was not a revised projection or forecast or anything.
    That was cash in hand that was above our forecast. We would
    normally have been recording that anyway in our monthly reports
    on the Treasury statements. However, we thought that we had an
    obligation not to be inflexible at that point in time and to
    transmit the information to the Budget Committees--which had
    also been noticing, because news accounts had begun to appear,
    that the Treasury was awash in cash. The Treasury was paying
    off some of the Federal debt, and it was apparent publicly that
    this was going on. Ignoring it did not seem to be at all
    prudent.
        The Budget Committees asked us what we expected the deficit
    for 1997 to be in view of the additional $45 billion, and since
    nothing much had come in different than what we anticipated on
    the outlay side, the extra $45 billion in receipts meant a $45
    billion lower deficit.
        The next question, which is perfectly reasonable, is, What
    effect would this have on future years? We do not revise our
    forecast or projections. We update them in the summer. But we
    met within CBO to discuss what effect we thought this could
    have on future years, and taking into account the reports of
    higher growth than we had originally foreseen, we thought that
    this was not something that would evaporate next year.
        One component would certainly not evaporate, which is that
    the reduced deficit in 1997 would mean reduced interest on the
    debt. That was automatic. It seemed to us that it would be a
    cautious forecast of what the effect would be to say that some
    of this may be temporary and some permanent. From what we knew
    that seemed perfectly logical.
        Therefore, we thought that even if we were projecting
    somewhat lower receipts, there would be offsetting debt service
    that together would reduce the deficit by approximately $45
    billion each year over the next few years.
        This is one of those situations where it is true that the
    timing may have seemed unseemly, but we cannot really worry
    about something like that. I mean, had we not said anything, I
    think that would have been highly damaging to the budget
    negotiations that were going on, because this was something
    that was really large. Rigidity at that point in time did not
    seem to be a good way of dealing with the information.
        Senator Bennett. Thank you. I appreciate that.
        I note the 45 times 5 is 225.
        Ms. O'Neill. That is where the $225 billion comes from,
    yes.

      relationship with the Joint Committee on Taxation and other agencies

        Senator Bennett. The projection of revenues, of course, is
    not made by CBO, as I have learned to my embarrassment, having
    yelled at CBO directors in previous hearings.
        Ms. O'Neill. No; it is a complicated story. We are
    responsible for the projection of revenues for legislation that
    is already passed. We are not responsible for the estimates for
    new legislation, but we do the projections of total revenues.
        Senator Bennett. I see. Well, this is done by the Joint
    Committee on Taxation, and I would just urge you to stay as
    close to them as you can. I am sure you are already doing that,
    but I was surprised, as a businessman, to come here and find
    that there were two agencies involved in that, and that calls
    for the greatest of coordination back and forth.
        Ms. O'Neill. We do work very closely with the Joint
    Committee on Taxation, and we also confer with the Treasury.
    The information on daily receipts comes from the Treasury. I
    would point out that we were not alone in underestimating
    revenues for this year. Actually, OMB's estimate of revenues
    for 1997 was lower than ours, and its estimated deficit
    somewhat higher.

                         Additional committee questions

        Senator Bennett. Thank you very much. We may have some
    additional questions for you in writing.
        We appreciate your coming. We appreciate your stewardship
    in trying to absorb the increased upward pressures by sound
    management practices within the agency so that the amount you
    request from the Congress is as modest as it is.
        Ms. O'Neill. Well, we try.
        [The following questions were not asked at the hearing, but
    were submitted to the Office for response subsequent to the
    hearing:]

                         Additional Committee Questions

        Question. In your testimony before this subcommittee last
    year, you indicated that CBO's fiscal year 1996 appropriation
    provided an increase of $1.1 million and 13 additional FTE's to
    handle the increased workload required by the Unfunded Mandates
    Reform Act. At that time, CBO estimated that the total
    resources CBO would need to devote to fulfilling those
    responsibilities would be $2.2 million and 24 FTE's. What was
    the total amount of resources CBO devoted in fiscal year 1996?
    What do you estimate for fiscal year 1997?
        Answer. In carrying out its new responsibilities under the
    act last year, CBO used an estimated 24 staff-years of effort
    and about $2.3 million--almost double the amount of additional
    resources provided in the appropriation for fiscal year 1996.
    Because we are expecting the amount of work to fall somewhat
    after the first year, both the fiscal year 1997 and fiscal year
    1998 budgets include 20 full-time-equivalent staff-years and
    about $2.1 million for preparing the mandate estimates required
    by the act.
        Question. CBO's ability to continue to contract for use of
    the House Information Resources mainframe computer has been an
    issue over the last few years. Last year you indicated you were
    pursuing other alternatives. In your testimony before the House
    this year you indicated you were going to use savings in the
    contract to study other alternatives. What is the status of
    your investigation into alternatives? What are their cost
    estimates?
        Answer. Over the years we have enjoyed a very good
    relationship with HIR. Given the choice, CBO would prefer to
    continue that association rather than move to another mainframe
    computer. However, should that not be possible, it is important
    that CBO be given enough time to ``migrate'' its applications
    to a new facility.
        Given the uncertainty of this situation, we have held
    preliminary meetings with a firm that specializes in
    converting, integrating, and testing older (so-called
    ``legacy'') systems. However, additional discussions with the
    firm, as well as the participation of key CBO staff, will be
    necessary before a contract can be agreed to. Still, we
    anticipate that a contract will be awarded and the work
    completed during this fiscal year.
        Our current agreement with HIR will not expire until the
    end of the fiscal year. By then, we expect to have an inventory
    of all mission-critical systems as well as migration strategies
    and their estimated costs. Those strategies will include
    possibly moving (``rehosting'') and modifying (``re-
    architecting'') CBO applications that now reside on the HIR
    mainframe. As a related task, we will ask the vendor as part of
    this contract to analyze all CBO systems (including those on
    the HIR mainframe) for problems that could arise in two years
    when the calendar shifts to the year 2000.

                              subcommittee recess

        Senator Bennett. Thank you. The subcommittee is recessed.
        [Whereupon, at 11:05 a.m., Tuesday, May 20, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

             LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1998

                                  ----------

                             THURSDAY, JUNE 5, 1997

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room S-128, the
    Capitol, Hon. Robert F. Bennett (chairman) presiding.
        Present: Senators Bennett, Stevens, and Dorgan.

                              LIBRARY OF CONGRESS

    STATEMENT OF DR. JAMES H. BILLINGTON, LIBRARIAN OF
                CONGRESS
    ACCOMPANIED BY:
            GEN. DONALD L. SCOTT, RETIRED, DEPUTY LIBRARIAN OF CONGRESS
            WINSTON TABB, ASSOCIATE LIBRARIAN FOR LIBRARY SERVICES
            RUBENS MEDINA, LAW LIBRARIAN
            JO ANN C. JENKINS, CHIEF OF STAFF, OFFICE OF THE LIBRARIAN
            LLOYD A. PAULS, ASSOCIATE LIBRARIAN FOR HUMAN RESOURCES
            LINDA J. WASHINGTON, DIRECTOR, INTEGRATED SUPPORT SERVICES
            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
            KENNETH E. LOPEZ, DIRECTOR OF SECURITY

                  OPENING STATEMENT OF HON. ROBERT F. BENNETT

        Senator Bennett. The subcommittee will come to order.
        This morning we are looking forward to hearing from three
    agencies: the Library of Congress, the Government Printing
    Office, and the General Accounting Office.
        I will comment that under the chairmanship of Senator Mack,
    for whom I worked for the 2 previous years in the last
    Congress, we worked very hard to decrease the spending in all
    three of these agencies. As I said in a previous subcommittee
    meeting, I think we did a pretty good job across the board for
    the legislative branch in bringing down expenses.
        The General Accounting Office in particular was faced with
    the challenge of absorbing a 25-percent budget reduction over
    the past 2 years. We will hear this morning on how these past
    reductions have been handled and how management has been
    conducted in these agencies.
        I am one who believes that once you have a belt tightening
    of this kind, it does not need to go on forever and the
    agencies need to be commended for doing a decent job. For this
    reason I have made it clear that I am not in favor of the
    position expressed by some Members of the House regarding a
    freeze in legislative branch appropriations. Such a freeze
    would indicate that we had not done our job in previous years
    and that some of the out of control activities that had been
    identified have not been brought under control.
        I would like to begin by commending the Library of Congress
    for its cooperation with the General Accounting Office as well
    as private consultants, Booz Allen and Price Waterhouse, in
    conducting a comprehensive review of the operations of the
    Library.
        The Library appears committed to improving the financial
    and management operations and has taken a number of steps which
    should result in cost savings and operating efficiencies. We
    look forward to hearing about those this morning.
        So, Dr. Billington, we welcome you and General Scott to the
    committee. We look forward to hearing from you.
        Senator Dorgan, the ranking member, has joined us.
        Do you have an opening statement, Senator?
        Senator Dorgan. Let me also welcome Dr. Billington and
    General Scott. We appreciate very much the service that you
    give to our country. I deeply admire the institution you serve
    and we are anxious to hear your testimony.
        Senator Bennett. Senator Stevens, do you have any comment
    at this time?
        Senator Stevens. No, thank you.
        Senator Bennett. Then, Dr. Billington, we are happy to hear
    from you.

                      opening statement of dr. billington

        Dr. Billington. Thank you, Mr. Chairman. I have submitted
    my full statement for the record which contains considerable
    detail both on our current operations and on the specifics of
    our request for the 1998 budget. I will also submit a full list
    of witnesses for the record. But I would like especially to
    introduce Gen. Donald L. Scott, the new Deputy Librarian, whom
    you will also be hearing from in just a minute.
        Senator Bennett. Without objection, your full statement
    will appear in the record.
        Dr. Billington. Thank you, sir.
        Mr. Chairman, the Library is like no other agency of the
    legislative branch and in many respects it is unique among
    institutions in the world. It is the world's largest, best
    organized, most accessible repository of knowledge and the most
    diverse, as well, in terms of the kinds of materials and
    languages it covers.
        With the support of the Congress, the Library of Congress
    serves both the national legislature, as well as the libraries,
    scholars, and plain citizens of the Nation. It is a resource
    that will be of increasing, incalculable value in ways we
    cannot even yet fully foresee to all Americans as we move into
    the information age.
        The Library is playing an important role in moving the
    legislative branch into that information age. Thanks to strong
    support from the Congress, the Library was able to rapidly
    develop the THOMAS system for making congressional information
    available online in a searchable form at the start of the 104th
    Congress. We are also working with the House and Senate to
    build an integrated legislative information retrieval system
    online at the start of the 105th.

                                     THOMAS

        THOMAS has already recorded more than 75 million electronic
    transactions, pretty clearly indicating the usefulness and
    appeal of congressional information to the American public.
        Congressional support, supplemented by major funding from
    private philanthropy for our national digital library, has
    enabled the Library to become a world leader in providing high
    quality content for the Internet.
        Congress is delivering back, in effect, increasing amounts
    of the Library's content to the American people.
        We are now recording about 42 million electronic
    transactions a month on all of our data bases, which is four
    times the number in 1993 and is close to 2 million transactions
    every working day.
        Our web site is widely recognized as one of the best.

                     Library's vision for the 21st century

        The Library's vision for the 21st century is to lead the
    Nation in ensuring access to knowledge and information and in
    promoting the Library's creative use for the Congress and for
    the Congress' constituents through the acquisition,
    organization, and dissemination of knowledge and solid
    information.
        Today, the Library faces the daunting, basic challenge of
    effecting a full transition to new, electronic services and
    more efficient electronically enhanced operations while at the
    same time continuing its basic services to Congress and the
    Nation. To maintain its services in the present, in other
    words, the Library must both preserve the past and embrace the
    future.

                                 Strategic plan

        The Library has established priorities and carefully worked
    out a strategic plan that extends through the year 2004. The
    two key requirements are, first, a modest, but inescapable,
    capital investment in technology now to build an integrated
    automation system; and second is basic, continuing support from
    the Congress to sustain our traditional work of cataloging,
    collection security, and access to the collections.
        This basic support particularly requires funding mandatory
    pay increases and unavoidable price level increases. Otherwise,
    we face erosion of what we have already done; and make the
    transition, that will eventually have to be made anyway, even
    more costly in the future simply to keep up to date.
        In only 3 years, Mr. Chairman, the year 2000, the Library
    of Congress will mark its bicentenary. This, along with the
    millennium that approaches will put both added burdens and
    added opportunities on the Library, but it will, we think, be
    an occasion to show the Nation and the world that America's
    elected representatives have had the wisdom to create and
    sustain the greatest repository of human knowledge and
    creativity in world history and to make it important not just
    for today's Congress and today's citizens but for future
    generations.
        By funding the Library's 1998 budget request, the Congress
    will enable the Library to head into the 21st century with the
    capacity to make its operations more efficient, to broaden
    vastly its access to its collections, and to provide even
    better service to the Congress and to the American people.

                              prepared statements

        So, Mr. Chairman, I urge the subcommittee to support the
    Library's budget request and I now ask that the Deputy
    Librarian also make a short introductory statement that will
    cover the important areas of management for which he has
    assumed, I think quite extraordinarily, fast control.
        General Scott.
        [The statements follow:]
                   Prepared Statement of James H. Billington
        Mr. Chairman and Members of the Subcommittee: I appreciate the
    opportunity to appear here to discuss the Library of Congress budget
    request for fiscal year 1998.
        With Congressional support and direction, the Library of Congress
    has developed over 197 years a massive collection of more than 111
    million items, cost-effective institutional networks, and a superbly
    knowledgeable staff. It has a potential unmatched by any other
    institution for making knowledge and information accessible to almost
    anyone almost anywhere.
        The Library directly serves not only the Congress but the entire
    nation with the most important commodity of our time: information. It
    is a unique resource of incalculable future value for the United States
    in the Information Age: a time when our society's economic productivity
    is increasingly based on information and individual achievement
    requires ever more life-long learning. The Library of Congress is
    fundamentally different from any other institution in the legislative
    branch of government.
        The Library's mission is to make its resources available and useful
    to the Congress and the American people and to sustain and preserve a
    universal collection of knowledge and creativity for future
    generations. The Library's first priority is to make knowledge
    available and useful to the United States Congress. This primary
    purpose can be realized only if the Library also preserves, secures,
    and sustains its incomparable collections for present and future use.
    These two activities are the top priorities in the Library's overall
    statement of mission and strategic priorities (attachment 1), closely
    followed by the imperative to make the Library's resources maximally
    accessible to the American people. The Library's ability to continue
    meeting these priorities rests on its ability to modernize its
    infrastructure and to advance its use of technology.
        The Library requests $387.6 million (including $30.4 million in
    authority to use receipts) for fiscal year 1998 to support its mission
    and strategic priorities. This is an increase of 7.1 percent over
    fiscal 1997; it includes $14.7 million to fund mandatory pay raises and
    unavoidable price-level increases and $11 million to meet critical
    growing workload increases (net of program decreases). The recent
    budget agreement includes a proposal that would increase the Library's
    mandatory pay costs by another $2 million due to higher agency
    retirement contributions. The additional $2 million in mandatory costs
    is not included in our budget request.
        During the past nearly 200 years, the Congress and the Library
    have, at critical times, taken necessary steps to integrate into
    Library operations the technology that will keep the Library's
    collection useful and relevant to the Congress and the Nation. The
    Library currently faces the fundamental challenge of effecting a full
    transition to the new electronic services and more efficient operations
    required for the Information Age while, at the same time, continuing to
    sustain its basic services. To ensure the Library's future utility to
    the Congress and the Nation, we are requesting this year new funds for:
    (1) a modern electronic Integrated Library System (ILS) that will
    provide inventory control and vastly improve the efficiency of core
    library functions including acquisitions, cataloging, collections
    security, and circulation and will ultimately save money; (2) continued
    implementation of our highest priority security initiatives, including
    additional police to cover newly renovated space and additional staff
    for an expanded reader registration program; (3) a temporary increase
    in additional FTE's and funds to support our staff succession plan to
    help ensure continuity of high-quality congressional and national
    services; (4) a temporary increase of $0.5 million for the Copyright
    Office to maintain registration processing at an acceptable level; and
    (5) the purchase of an additional 10,000 talking book machines to
    ensure the continued availability of the equipment for blind and
    physically handicapped people.
        In this time of budget austerity, the Congress has been extremely
    supportive of the Library of Congress, continuing to increase its
    budget over the past several years. However, the actual number of
    appropriated full-time equivalent (FTE) positions has declined by 435
    or 10 percent since fiscal 1992. The Library's budget has simply not
    increased enough to support the same number of FTE's that were funded
    in fiscal 1992. The Library has so far managed to accomplish its
    mission with fewer staff by: (1) identifying functions and activities
    that may have been desirable in the past but do not support high enough
    priorities to justify their costs in today's budget environment (for
    example, the Library has eliminated less popular reading room hours on
    Sundays and Tuesday and Friday evenings for the Main Reading Room, Law
    Library, and five other reading rooms); and (2) implementing changes in
    its business processes that improve the efficiency of operations (for
    example, the Library re-engineered the Federal Transfer Program,
    dramatically reducing the receipt and processing of millions of surplus
    materials from Federal agencies, thereby eliminating substantial
    handling costs).
        In fiscal 1997, the Library will shift some resources, with
    Congressional approval, to address general management improvements and
    security initiatives recommended in two recent GAO-commissioned reports
    (a management review by Booz-Allen & Hamilton and a financial audit by
    Price Waterhouse LLP). Because the Library did not receive price-level
    increases in fiscal 1997 and must fund several non-payroll priorities
    (e.g., auditor fees) from existing funds, the shift in fiscal 1997
    resources will cause a projected reduction of another 7 FTE's (see
    attachment 3). The Library is working on ways to carry out economy
    measures while addressing key GAO-sponsored recommendations, but it
    does not appear likely that they will provide large-scale financial
    savings in fiscal 1998.
        Since the Library's services are extremely labor intensive (some 70
    percent of our budget is for payroll costs), future economies must come
    primarily from re-engineering our major operations and from investing
    further in automation; both steps will improve the productivity of our
    staff. The Library's fiscal 1998 budget requests an increase of $6.1
    million for automation projects needed to improve internal operations
    and make the collections more accessible. The investment in better
    automation now will greatly improve service and save money in the long-
    term. The investment the Congress made during the late 1980's and early
    1990's in the Library's automation program made possible both the rapid
    implementation of THOMAS in 1994 and the first release of a retrieval
    component of the Legislative Information System in January 1997.
    Investments made today may take several years to bear fruit, but will
    produce major productivity and quality improvements in our basic
    library and copyright operations. If we are to stay at the cutting edge
    for the Congress and the nation, we must invest today in three
    automation projects--the Integrated Library System (ILS), the Copyright
    Office Electronic Registration, Recordation and Deposit System (CORDS),
    and the Global Legal Information Network (GLIN).
        These major re-engineering and automation projects must be
    completed if the Library is to be as relevant to the emerging needs of
    the Congress and the Nation as it has been to those of the recent past.
    Funding our fiscal 1998 budget request, including provisions for
    mandatory pay and price-level increases, will enable the Library to
    sustain its basic services while continuing to modernize its operations
    for the future. It would bring the Library's automated systems up to
    the level now being achieved by other major research libraries in
    America. If this request cannot be granted, and we are, as a result,
    required to make further staff cuts before major productivity projects
    are implemented, we would make reductions in accordance with our
    priorities. We would regrettably have to begin fairly rapidly to reduce
    public programs--particularly those which preferentially serve the non-
    governmental Washington area such as public reading room hours,
    reference support, and local access to the Library's buildings. We
    would reduce further, if not eliminate altogether, exhibits,
    publications, and other outreach programs.
        It would be tragic to cut back drastically on these traditional
    services on which so many who live in or come to Washington depend--and
    for which Congress has created such exciting new opportunities through
    its glorious restoration of the Thomas Jefferson and John Adams
    buildings. But the damage would be irretrievable if we cut back even
    for a year the basic acquisition and servicing of the collections, and
    it would be inadmissable not to sustain and advance the leadership role
    the Congress has encouraged the Library to take in sharing more of its
    contents with the nation as a whole. Future generations will not
    forgive us if we fail to make electronically accessible via the
    Internet the Library's unique and useful materials at precisely the
    moment when the Library's proven technological capability to provide
    such access is enjoying enthusiastic public--and growing private--
    support. In short, we believe that the Congress should sustain its
    fruitful investment in the Library and not let erode the great
    institution it has wisely created and supported for 197 years.
        A brief review of the Library's past and present is essential for
    understanding the Library's priorities for fiscal 1998.
                                 early history
        The Library of Congress is a living monument to the remarkable
    wisdom of the Founding Fathers who saw access to an ever-expanding body
    of knowledge as essential to a dynamic democracy. The Library's three
    buildings are named for Thomas Jefferson, John Adams, and James
    Madison. With their support, the Congress established the Library in
    1800 as soon as it moved to the new capital city of Washington and
    established the Joint Committee on the Library as the first Joint
    Committee of the Congress in 1802.
        Jefferson, in particular, took a keen interest in the new
    institution. After the British burned the Capitol and the Library
    during the War of 1812, Congress accepted Jefferson's offer to
    ``recommence'' the Library and purchase his multilingual 6,487-volume
    collection (then the finest in America) at a price of $23,940. It
    contained volumes on everything from architecture to geography and the
    sciences. Anticipating the argument that his collection might seem too
    wide-ranging for Congress, Jefferson said that there was ``no subject
    to which a Member of Congress might not have occasion to refer.''
        Jefferson's ideals of a ``universal'' collection and of sharing
    knowledge as widely as possible still guide the Library. With
    Congressional blessing, it has grown to serve the Congress and the
    nation--largely as a result of four milestone laws: (1) the copyright
    law of 1870, which stipulated that two copies of every book, pamphlet,
    map, print, photograph, and piece of music registered for copyright in
    the United States be deposited in the Library; (2) the 1886
    authorization of the first separate Library building that contained
    openly accessible reading rooms and exhibition space for the general
    public; (3) the 1902 law which authorized the Library to sell its
    cataloging records inexpensively to the nation's libraries and thus
    massively help to subsidize the entire American library system; and (4)
    the law in 1931 that established the program in the Library to create
    and supply free library materials to blind and physically handicapped
    readers throughout the country. Congress thus established the basis
    both for the continued growth of the collections and for the extension
    of the Library's services to citizens everywhere.
        Congress created in 1914 the Legislative Reference Service (LRS) as
    a separate entity to provide specialized services to ``Congress and
    committees and Members thereof.'' In 1946, the Congress granted LRS
    permanent status within the Library and directed it to employ
    specialists to cover broad subject areas. Congress renamed the LRS the
    Congressional Research Service (CRS) in 1970 and enhanced its
    analytical capabilities by adding additional staff and emphasizing
    research support to the committees of Congress.
        More recently, Congressional statutes have created the American
    Folklife Center (1976), the American Television and Radio Archives
    (1976), the National Center for the Book (1977), the National Film
    Preservation Board (1988), and the National Film Preservation
    Foundation (1996)--further extending the Library of Congress' national
    role.
                         the library of congress today
        The core of the Library is its incomparable collections--and the
    specialists who interpret and share them. The Library's 111 million
    items cover more than 530 miles of shelf space and include research
    materials in more than 450 languages and almost all media through which
    knowledge and creativity are preserved and communicated.
        The Library has more than 26 million volumes, including 5,700
    volumes printed before the year 1500; 13 million prints, photographs,
    and posters; 4 million maps, old and new; 700,000 reels of film,
    including the earliest movies and television shows; 4 million pieces of
    music; 48 million pages of personal papers and manuscripts, including
    those of Presidents Washington through Coolidge; and hundreds of
    thousands of scientific and government documents.
        New treasures are added each year. Recent acquisitions, to name a
    few, include the collection of Marion S. Carson, the nation's most
    extensive private collection of Americana, which includes the earliest
    photographs ever taken of a human face and of an urban scene, as well
    as more than 10,000 manuscripts, rare books, broadsides, photographs,
    drawings, prints, and other original documents; the personal papers and
    several hundred original drawings of cartoonist, playwright, and
    screenwriter Jules Feiffer; the collection of jazz great Ella
    Fitzgerald, comprising some 10,000 music scores; and important rare
    books such as Antonio de Medina's Viaggio di terra Santa (1590), an
    extremely rare and richly illustrated Italian translation of a Spanish
    pilgrimage to the eastern Mediterranean.
        Every work day the Library's staff takes in approximately 10,000
    new items for its collections, organizes them, catalogs them, and finds
    ways to share them with the Congress and the nation--through on-line
    access across the nation, through in-person access in the Library's
    reading rooms, and through cultural programs that feature the Library's
    collections and reach across the country.
        The Library of Congress programs and activities are funded by four
    salaries and expenses (S&E) appropriations, which support congressional
    services, national library services, copyright administration, and
    library services to blind and physically handicapped people. A separate
    appropriation funds furniture and furnishings. Major services (see
    attachment 2) include providing annually responses to some 500,000
    congressional requests, registering more than 560,000 copyright claims,
    cataloging some 300,000 books and serials, and circulating more than 23
    million audio and braille books and magazines to blind and physically
    handicapped individuals all across America. The Library also now
    processes over one million Internet transactions every day (which
    provide access to the Library's on-line information files that contain
    more than 40 million records).
        The Library has become a world leader in providing high quality
    content for the expanding Internet, and was recently cited by Time
    magazine, among others, as one of the best websites of 1996. The
    Congress--and this Committee in particular--has made it possible for
    the Library to help bring the Legislative Branch into the Information
    Age. We believe that much more can be accomplished by investing further
    in the transforming technology required to exploit this unique national
    resource.
                         the library's planning efforts
        During fiscal 1996, the Library developed a Management Improvement
    Plan (MIP) to focus its efforts on implementing the Library's
    priorities: Provide Support to the U.S. Congress; Preserve, Secure and
    Sustain a Universal Collection; Make the Library's Collections
    Maximally Accessible; and Enhance the Educational Value of the
    Library's Collections.
        The MIP also addressed the useful recommendations contained in two
    reports commissioned by GAO and completed in 1996--a management review
    conducted by Booz-Allen & Hamilton and a financial audit conducted by
    Price Waterhouse LLP. The MIP contains nine parts: plans and programs;
    security (of people, facilities, collections, and data systems);
    management-employee communications; training and development;
    accountability mechanisms; support functions' efficiency and
    responsiveness; streamlined management processes; financial management;
    and broader understanding and appreciation of the Library.
        Using as our guide the Library's statement of mission and strategic
    priorities endorsed by the 104th Congress, we updated our 1993-2000
    strategic plan to take us through the year 2004. The Library's
    challenge, under the 1997-2004 strategic plan, is to sustain past gains
    while becoming a more efficient and effective operation. The Library's
    vision for the 21st century is to ``lead the nation in ensuring access
    to knowledge and information and in promoting its creative use for the
    Congress and its constituents.'' The United States has, and must
    continue to have, the finest national library in the world.
        With that background, I am happy to present the Library's fiscal
    1998 budget request, relating it to our priorities:
    Support to the United States Congress
        The first priority of the Library of Congress is, and will remain,
    to serve the information and research needs of the Congress. The
    Congressional Research Service, the Law Library, the Library Services'
    Loan Division, and other elements of the Library of Congress provide a
    cost-effective, shared resource that serves all Committees and Members
    in a nonpartisan manner.
        The fiscal year 1998 budget request seeks funding for 25 additional
    FTE's in the Congressional Research Service as part of a multi-year
    succession plan. By 2006, nearly 52 percent of CRS' staff will be
    eligible to retire. This poses a significant threat to CRS' ability to
    maintain its current analytic and information services unless training
    of replacement staff can begin soon, under the tutelage of the senior
    staff who are eligible for retirement.
        As directed by the Legislative Branch Appropriations Act of 1997,
    the Library and CRS worked with the House, the Senate, and legislative
    agencies to put into production the initial release of a new retrieval
    component of the legislative information system (LIS). The retrieval
    component is based on national standards and is being built on an open
    architecture, which will enable the system to accommodate future
    improvements to data management systems. The purpose of the LIS is to
    improve the efficiency of dissemination of information for the
    legislative branch and to avoid unnecessary duplication of effort. The
    LIS will provide the Congress with far greater on-line access to a
    variety of legislative documentation, including: full-text legislation,
    bill summaries, committee reports, floor schedules, and the
    Congressional Record. The on-line availability of this information will
    make it easier for Members and staff to track bills through the law-
    making process, and will also help CRS to do its work in a more cost-
    effective and timely manner.
        In addition to the retrieval component of the LIS, the Library has
    participated in a number of discussions and meetings with legislative
    branch staff to support the establishment of a program for the exchange
    of information between legislative branch entities that would over time
    significantly improve information technology planning and evaluation.
        CRS also completed a major initiative during the past year to
    improve on-line delivery of its products and services. All CRS issue
    briefs are now available electronically to congressional offices
    through the CRS home page. This effort is part of a continuing program
    to improve the speed and delivery of CRS products and services by
    providing them to Members and staff on-line. CRS continuously updates,
    refines, and improves the availability of information on the CRS Home
    Page to ensure that we remain responsive to congressional needs.
        For its part, the Law Library is rapidly expanding its
    multinational electronic database called the Global Legal Information
    Network (GLIN) to ensure that the Congress has rapid and reliable
    information on foreign, international, and comparative law. GLIN made
    its debut on the Library's home page in July 1996. Member nations are
    contributing abstracts and full text of laws at the rate of 15 entries
    per day and growing. Fourteen countries have been fully trained to
    participate via the Internet, and the Library projects that GLIN
    membership will soon increase to 15-20 nations. The fiscal year 1998
    budget requests $223,362 and three additional FTE's to support the
    expansion of GLIN. The Library has been funding GLIN so far by
    reallocating existing resources, and NASA has provided support to
    explore and test satellite communications. In addition, international
    agencies (e.g., the World Bank) have provided support to participating
    nations. We project that GLIN will attract at least 50 members by 2002
    and will create an easy-to-use database, allowing faster service to the
    Congress. It should eventually produce savings to the Library's budget
    as other nations begin sharing the costs to acquire, catalog, and make
    accessible international laws.
    Preserve, Secure and Sustain a Universal Collection
        The second priority of the Library of Congress is to preserve,
    secure and sustain for the present and future use of the Congress and
    the nation a universal collection of human knowledge, including
    comprehensive records of American history and creativity.
        A universal collection is even more essential today than it was a
    few years ago if the Congress is to meet its legislative and
    representational responsibilities. There are many more countries,
    institutions, and individuals creating important information on more
    subjects, and the Congress and U.S. Government have more complex and
    far-ranging concerns and needs than ever before. To keep America
    competitive and to foster creativity in the Information Age, Americans
    will increasingly have to rely on better and more timely use of
    knowledge. This, in turn, requires continuing access to the many
    languages and to the expanding range of formats in which important
    knowledge is now being generated, recorded, and communicated.
        The Library's unique resources provide an indispensable reservoir
    of information upon which important legislative decisions are made. If
    a democratic society is to be dynamic and productive, access to
    information is not a luxury, it is a necessity.
        The fiscal 1998 budget request supports this priority by funding
    several major items:
        Library Materials.--A price level increase of $1,161,000 is
    necessary to sustain purchasing power at fiscal 1995 levels and to
    recoup fiscal 1996 and 1997 price level increases for books, machine-
    readable works, and other materials. Many of these are foreign
    publications--on all subjects--that are purchased from countries with
    high rates of inflation. The amount of material we can afford to
    purchase from appropriated funds has declined seriously--from 930,747
    pieces in fiscal 1992 to 707,695 pieces in fiscal 1996. We cannot
    permit further erosion in these acquisitions--particularly since these
    reductions disproportionately hurt precisely those foreign acquisitions
    which only the Library of Congress makes and which often have growing
    importance for our international competitiveness. We should not risk
    depleting what is, in effect, the nation's strategic information
    reserve. It will have many uses tomorrow that we cannot even imagine
    today.
        Copyright Office.--The fiscal 1998 budget request also supports a
    growing workload increase of five FTE's and $304,179 to continue
    implementation of the Copyright Office's pioneering Electronic
    Registration, Recordation and Deposit System (CORDS). We have reached a
    critical point in the development and implementation of CORDS. The
    Copyright Office has proved during its pilot of 1996 that electronic
    registration and deposit works. Now the CORDS system is being perfected
    through a number of critical test phases with external participants.
    CORDS will both (1) help the Copyright Office streamline its complex
    internal registration, recordation and deposit processes; and (2)
    provide the Library with copies of new copyrighted works in digital
    form for its collections. Re-engineering the Copyright Office's
    registration processes and integrating them with the Library's
    acquisition and cataloging processes is critical to the long-term cost-
    effectiveness of operations. Electronic publishing is growing
    exponentially; and the Library must be a leader in testing and
    demonstrating the means to acquire, authenticate, store securely and
    provide authorized access to this vast body of new copyrighted works in
    electronic form. CORDS is a crucial component.
        For many years, the Copyright Office has been steadily increasing
    overall productivity even as its staff has shrunk. In fiscal 1980, a
    staff of 628 FTE's processed 483,000 claims; in 1996, a staff of 471
    FTE's processed 609,000 claims representing more than 700,000 works. At
    the simplest level, the staff in 1996 is 25 percent lower than in 1980,
    yet it processed more than 26 percent more claims. These gains were the
    result of systematically automating various processes and increasing
    the efficiency of manual procedures by eliciting ideas at all levels in
    the Copyright Office.
        More recently, however, the Copyright Office has been able to keep
    up with its irreducible clerical workload only by using overtime and
    additional temporary help. By the end of fiscal 1995, the steady loss
    of trained staff (particularly examiners, whose number fell from 64 to
    49 FTE's in three years, and whose expertise cannot be replaced with
    temporary staff) resulted in growing backlogs. The registration
    processing period has grown alarmingly from a norm of five to seven
    weeks in 1993 to more than 18 weeks now.
        To stem this growing backlog, the Copyright Office requests
    additional funding of $538,953 and 14 FTE's. Fiscal relief can come in
    the future through a legislated ability to increase the fee schedule,
    but a temporary increase for fiscal 1998 is needed to cope with the
    current workload.
        Security.--A fiscal 1998 increase of $1.3 million is requested to
    improve security. A number of needed security improvements have been
    funded by changing the priority for existing resources and by
    reprogramming resources, such as the fiscal 1997 reprogramming of funds
    that has enabled us to hire our new Director of Security. We have made
    major efforts here, as supported by the Congress.
        A key component of the collections security program is the reader
    registration program. Under this program, each researcher using the
    reading rooms is required to provide positive identification. Once such
    identification (photo ID with address) is presented, the Library issues
    a Reader Identification Card to the individual with the person's photo
    and signature, as well as a machine readable card number. Thus, patron
    information is available for management--including the Library's Office
    of the Inspector General, if necessary. The funding requested
    ($393,410) will permit the operation of two reader registration
    stations, one in the Thomas Jefferson Building and one in the James
    Madison Building, the buildings in which most of the Library's reading
    rooms are located. The Library anticipates issuing 100,000 Reader
    Identification Cards annually.
        The fiscal 1998 budget proposes $417,035 and 18 FTE's for
    additional police officers. Seven additional police FTE's are needed to
    staff posts in the Library's Thomas Jefferson Building now that it has
    reopened. Funding for three FTE's (and authorization for a total of 11
    additional police FTE's) are also necessary to reduce the present
    police overtime rate. In fiscal year 1996, the Library contracted with
    Computer Sciences Corporation (CSC) to conduct an in-depth physical
    security survey of the Library and review police operations. CSC's
    report indicated that Library police are currently understaffed to
    accomplish their mission and must work excessive overtime which reduces
    their effectiveness. The Library's goal is to reduce police overtime,
    now computed at approximately 26,000 hours per year (roughly 25 percent
    of total scheduled hours), to approximately 10,000 hours (roughly 10
    percent of total scheduled hours). The Library believes a 10 percent
    overtime rate will not compromise the effectiveness and quality of
    performance. Our security requirements have increased since the
    Oklahoma City bombing incident in 1995, but we have not been able to
    increase our police staffing sufficiently to handle these new
    requirements without excessive overtime. Funding for $268,000 in non-
    personal increases is also needed to train and uniform the new police,
    to support contract staffing for two new cloakrooms, for installation
    and maintenance of security equipment, and for contract support of some
    non-police functions.
        The copyright system is a major source of acquisitions for the
    Library. The high volume and great variety of materials that come in
    daily to the Library and are temporarily stored in tubs, on book trucks
    and on open shelves while awaiting processing create a point of serious
    vulnerability to untraceable loss. A key need of security is to gain
    item level control at the earliest point of entry into the Library. The
    fiscal 1998 budget requests $242,072 and six FTE's to apply magnetic
    strips and accession labels to all works as soon as they enter the
    Library through copyright.
        We have developed a Library Security Management Plan to integrate
    recommendations from CSC and others into a management level framework
    for phased and prioritized implementation of efficient, cost-effective
    solutions. The Library's highly-qualified new Director of Security will
    oversee the implementation of this plan.
        Integrated Library System (ILS).--Essential to improved security
    and overall process improvements is the Library's request for a $5.6
    million increase to purchase and install an Integrated Library System.
    This initiative builds on our previously-identified need to provide
    inventory control over our collections through the conversion of two
    very large manual files--our shelflist of over 12 million cards and our
    serial record file with cards for almost 900,000 serial titles. These
    files constitute the only comprehensive record of what book and serial
    copies have been added to the Library's collections over the course of
    nearly two hundred years. Information about these materials needs to be
    available to all staff and to public users from any location, not just
    to the relatively few staff with access to the card files.
        An integrated library system is essential for ensuring the security
    of the Library's collections. Currently, there is no Library-wide
    system for recording what we have and where it is. The security of the
    Library's collections depends to a very large degree on our procuring
    an automated system that will allow us to document and to track
    collection materials on a continuing basis from the point they enter
    the Library.
        The time has come when we must begin the systematic and overall
    replacement of our several separate, outmoded computer systems. These
    systems have served us well for over 25 years, and we are fortunate
    that there have been no major breakdowns or failures. But these legacy
    systems are simply not adequate to support us as we move into the 21st
    century. In order to continue re-engineering our business processes, we
    need a single system that integrates all major functional areas, such
    as cataloging, acquisitions, inventory, and circulation. Better
    automation support will enable Library staff to be more productive,
    permitting the Library to deliver existing products and services with a
    smaller workforce. For example, by streamlining cataloging, by
    eliminating inefficient and error-prone re-keying in several areas, by
    reducing duplicate acquisitions, and by minimizing the handling of
    materials, we expect to be able to reallocate substantial resources to
    other critical mission work, such as collection security. We estimate
    that we will be able to reallocate approximately $6 million per year to
    high-priority mission work once the new system is fully in place in six
    years. Overall, systems replacement will result in greatly improved
    service by providing a simple yet powerful public catalog, up-to-date
    information about the status and availability of materials in our
    collections, and easily traversed connections to a wide variety of
    research tools, including the rich resources of the National Digital
    Library.
        Preservation.--On the preservation front, the decay of materials
    printed and written on acidic paper continues to be a serious problem.
    Paper-based books and records are in effect being consumed by ``slow
    fires'' no less deadly than the fast fires that destroyed the Capitol
    and the Library of Congress in 1812. Though printing on more permanent
    alkaline paper is a recent encouraging development, millions of books
    published during the past 150 years on acidic paper bear the seeds of
    their own destruction.
        Since the 1970's, the Congress has supported the Library's national
    leadership in a scientific odyssey to solve the problem of
    deteriorating acidic paper. The objective has been to develop or obtain
    the use of mass deacidification processes to neutralize the acid in
    books and other paper-based materials before they become so brittle
    that the only way of saving the contents is by much more costly
    reformatting, such as microfilming.
        Congress approved our plan two years ago to expend no-year funds
    previously appropriated for mass deacidification development in order
    to work with a private firm to improve the Bookkeeper process and then
    to begin deacidifying books on a limited scale. For the first time
    since we began our search for a mass deacidification process 20 years
    ago, the Library moved beyond research and testing during the past year
    and began deacidifying books from the Library's collections, committing
    ourselves to deacidifying 72,000 books using the Bookkeeper process. We
    successfully treated 25,000 books in fiscal 1996 from the general
    collections, the Law Library, and the Asian Division and expect to
    treat an additional 47,000 books in fiscal 1997. A plan to deacidify
    another 275,000 books and evaluate other processes is pending approval
    of the Committee.
        There is more good news on the preservation front. As a result of
    installing a state-of-the-art audio preservation system to digitize
    audio materials, the Library took a giant step in 1996 toward
    preserving and increasing access to these hitherto little used
    materials in the Library's collections. This system's impressive
    features will allow the Library to preserve and restore at least 80
    percent of its audio collections, including more than 98 percent of the
    audio cylinders, at an unprecedented level of quality, and to undertake
    research essential for the preservation of digital audio data.
        Arrearage Reduction.--Arrearage reduction efforts remain a major
    Library enterprise. Despite steady reductions in staff, we continued
    during fiscal 1996 to reduce the backlog of unprocessed materials--by
    1.5 million items--while remaining current with new receipts. As of
    March 31, 1997, we have achieved a cumulative 50 percent decrease (19.7
    million items) in our backlog since the arrearage reduction project
    began. We are well ahead of our target goals for reducing the books and
    serials arrearage. We will continue to streamline cataloging and
    processing; but arrearage reduction work is unavoidably labor
    intensive, and we have reached the point where any further reductions
    in staff (before the cataloging process is re-engineered), which would
    result from not funding mandatory pay increases, would seriously slow--
    and could reverse--the continued success in this major effort.
    Make the Library's Collections Maximally Accessible
        The Congress has extended the services of the Library of Congress
    to the nation by providing public access to its rich resources through
    its 20 public reading rooms, through interlibrary loan, through a
    variety of special programs, and most recently through electronic
    access.
        The Congress also established in 1931 a program in the Library of
    Congress that creates and supplies free library materials to blind and
    physically handicapped readers throughout the country. Administered by
    the National Library Service for the Blind and Physically Handicapped,
    this service actually began in 1897 when the new Library of Congress
    building opened with a special reading room for blind patrons. The
    fiscal 1998 budget request includes a growing workload increase of
    $2,500,000 for procurement of audio cassette book machines.
    Approximately 10,000 units will be added to those currently scheduled.
    These machines will permit service without interruption and waiting
    lists.
        In fiscal 1996, the Congress approved a braille centralization
    initiative that had the potential of saving millions of dollars for the
    network of non-Federal libraries but would have cost the Library of
    Congress nearly $700,000 annually. Initially, the Library believed a
    portion of its costs could be absorbed; however, current budgetary
    constraints would unacceptably decrease the production and distribution
    of braille materials, the primary mission of the Library, to support
    this centralization initiative. Therefore, the Library is not
    implementing this centralization project and has encouraged the network
    libraries to pursue this initiative without Federal support.
        The Congress approved and funded the National Digital Library
    program as part of the fiscal 1996 budget. This is a public-private
    partnership to digitize the most important and interesting historical
    Americana materials from the Library for viewing by American citizens,
    in schools, libraries and homes everywhere. The overall goal is to
    digitize, in collaboration with other institutions, millions of
    American history items from the Library of Congress and other
    repositories by the year 2000--the Library's bicentennial. We are
    increasingly working in collaboration with other great American
    repositories with unique materials; and we are on schedule with our
    public-private partnership for raising the $60 million needed over the
    five-year period from 1996 to 2000: $15 million from the Congress and
    $45 million from the private sector. Making these priceless treasures
    of American history accessible to all Americans in their own local
    communities, is central to the Library's goal of enriching education in
    America and widening access to the documentary record of America's
    knowledge and creativity.
        This pathbreaking public-private partnership has so far generated
    the direct contribution by the private sector of $24.5 million, matched
    by the Congressional appropriation of $3 million per year beginning in
    fiscal 1996.
        The Library has seventeen large and unique collections online,
    fascinating archives of American history that have drawn wide public
    acclaim. They attract more than 4 million electronic hits a month. The
    National Digital Library Program was featured at the National
    Educational Summit attended by all state governors in April of 1996 and
    has been cited by Time magazine and many other sources as one of the
    best of all Internet websites.
        To date we have multi-year contracts in place for digitizing more
    than 1.7 million digital items in addition to the more than 300,000
    already archived. We have established a dozen ways to process and
    convert collections materials to digital form and to develop new
    technical standards for storing and sharing these items electronically.
    Operationally, we have built an efficient organization which will work
    to integrate this five-year public-private effort into the internal
    functions of the institution. Our pioneering work in making high
    quality content electronically available in a reliable and user-
    friendly format is providing valuable experience for our (and other
    libraries) overall programs of electronic modernization.
        The Library of Congress has historically served not only Congress
    but the nation's libraries, providing leadership in cataloging and the
    development of technical standards. The creation of the catalog record
    and MARC standard, now used world-wide, was the Library's gift to the
    nation. Great economies of scale were possible by these developments,
    saving libraries the cost of duplicative cataloging and enabling the
    easy exchange of information. This role continues unabated in the
    digital era as we play a similar role, often in collaboration with
    other great research libraries, by helping the library and educational
    community gain local access to not just our catalog records but also to
    full documents, musical scores, collections of photographs, and many
    other types of materials which have never before been widely available.
        Standards and best practices will be crucial to the handling of
    electronic materials. Our Copyright Office is creating a system and
    technical architecture that will also handle full documents (digital
    objects), and is working closely with Library Services and the National
    Digital Library Project to develop an infrastructure for the future.
    Enhance the Educational Value of the Library's Collections
        Through interpretive and educational programs, the Library shares
    its rich collections of printed books, manuscripts, prints and
    photographs, maps, sound recordings, and films with the nation's
    citizens. The Library's World Wide Web site has been particularly
    useful in reaching its various constituencies, including the general
    public. Electronic exhibits, one of the most popular areas on the Web
    site, permit people who cannot journey to Washington, D.C. to view in
    their own localities materials from the Library's exhibits and to learn
    about their significance in the history of mankind. Electronic exhibits
    are cost-effective--permitting the public everywhere to enjoy and
    benefit from them long after the physical exhibit has been dismantled.
    Library-developed publications are also becoming increasingly available
    on the Web, and active collaboration with publishers has resulted in an
    increased public awareness of the extraordinary and unique materials in
    the collections.
        The Library's interpretive and educational programs are fourth
    priority activities and have thus been made heavily dependent on
    private funding for their operation. Although the demand for more
    exhibits, programs, and publications grows, a combination of gift and
    trust funds, improved operational management, and technological
    opportunities have been and will continue to be relied upon to meet the
    need. The Library's private fund-raising has resulted in generous
    contributions from donors and from the James Madison Council in support
    of exhibits, scholarly programs, and publications. In fiscal 1996, we
    raised $10.6 million in new pledges and non-pledge philanthropic gifts
    with one of the smallest development offices of any major national
    cultural institution.
        In its centennial year of 1997, the Thomas Jefferson Building,
    magnificently restored with the support of the Congress, is now largely
    reopened. Scholars and researchers are able to use exceptional global
    resources in the new European, Asian, and African and Middle Eastern
    Reading Rooms. The Library opened a permanent and privately-funded
    ``American Treasures of the Library of Congress'' exhibit on May 1,
    1997. This exhibit enables visitors to see for the first time a wide
    variety of the inspirational original documents of American history
    from the collections. More than 200 objects from the Library's
    incomparable record of America's memory from Thomas Jefferson's rough
    draft of the Declaration of Independence and Benjamin Franklin's
    letters to original musical scores by Gershwin and Jelly Roll Morton to
    Alexander Graham Bell's first sketch of a telephone and the earliest
    copyright deposit moving images from Thomas Edison's laboratory--all
    are on display in the Treasures Gallery. This sweeping exhibition, on
    display in the magnificent Thomas Jefferson Building, re-establishes
    the Library of Congress as a major tourist attraction; and for those
    who cannot visit Washington, an expanded on-line version of
    ``Treasures'' is accessible on the Internet.
        In the year 2000, the Library of Congress will celebrate its
    bicentenary. Our 200th birthday provides the opportunity to heighten
    the nation's awareness and utilization of the Library as a major
    resource for the Congress and the American people as we enter the new
    millennium in the midst of the information age. Planning is underway
    for a national celebration with advice and participation from the
    Congress as well as the library, scholarly, and educational
    communities. The National Digital Library Program, through which the
    Library's collections directly reach American citizenry, is a key
    element of the celebration. Preliminary plans include on-site and
    digitized exhibitions on Thomas Jefferson, democracy, and knowledge,
    and on the history of the Library of Congress in American life; an
    illustrated history of the Library; the issuance of a commemorative
    stamp; Congressional authorization of a Bicentennial Advisory
    Commission and a commemorative coin series; national television and
    radio programming; and events at local levels. Most of the funding will
    come from private sources.
                            enabling infrastructure
        The Library's strategic planning process has developed objectives
    for the supporting infrastructure to ensure that the Library is able to
    carry out its mission efficiently in accordance with its priorities.
    The key objectives are motivating and mobilizing human resources,
    efficiently delivering electronic services and using space and
    equipment, and providing modern financial and information systems.
        In December 1996, the U.S. Court of Appeals for the District of
    Columbia approved the final settlement of the Cook class action
    lawsuit, which dates back to 1982. The Library has already put in place
    many of the agreement's provisions, including changing the selection
    process to ensure that it is fair and equitable; training all managers
    and supervisors in diversity awareness; promoting 39 class members; and
    reassigning three others. Working closely with the Departments of
    Justice and Treasury, payments totalling $8.5 million were made to
    class members in April. Above and beyond the implementation of this
    settlement, the Library has a continuing commitment to ensure equal
    opportunity and fairness in all our activities.
                         library buildings and grounds
        The Architect of the Capitol (AOC) is responsible for the
    structural and mechanical care of the Library's buildings and grounds,
    which are critical components of the Library's infrastructure. Each
    year, the Library suggests priority capital improvement requirements to
    the AOC, and the AOC is responsible for submitting the budget request.
    The Library Buildings and Grounds budget request for fiscal 1998 totals
    $15,755,000--a $6 million increase from fiscal 1997, primarily for
    capital improvements required to support Library programs.
        Our prime concern has been off-site storage of Library materials at
    Fort Meade, Maryland. The Library has been working closely with the AOC
    on the building design for Storage Module 1, the first of several
    storage modules to be constructed at Fort Meade. The final designs and
    logistics plans will be reviewed within the next few months.
    Construction is expected to begin by the end of 1997. The AOC plans to
    have the facility completed in time for the Library to begin occupancy
    by mid 1999. Additional modules for collections, materials screening/
    holding, furniture and equipment storage, and copyright deposits are to
    be constructed and occupied over the next 10 years. We envision a
    continuous building program at Fort Meade to ensure that the Library's
    growing collections remain secure and accessible. Additional funding
    will be needed in the future to support this building program as we
    vacate existing leased storage space in Landover, Maryland.
        Although the Library's plans for Fort Meade originally included
    building a nitrate film processing and storage facility, the Department
    of the Army has indicated that such a facility could not be constructed
    there. As a result, the Library has been exploring other alternatives,
    including seeking private sector donations to fund a major part of a
    facility at another location. The Library has developed a comprehensive
    plan for a new National Audio-Visual Conservation Center and is now
    developing a funding strategy that will likely seek congressional
    authorization for a public-private partnership similar to that which
    has made the National Digital Library program so successful.
                              proposed legislation
        The Library is seeking legislation to allow the Copyright Office to
    set the fees for basic services, to improve the efficiency of the
    copyright arbitration process, to improve financial management
    activities, to support the Library's bicentennial activities, and to
    seek permanent authorization of the American Folklife Center.
        Much of the work that the Copyright Office performs is a service
    for which the public pays a fee. In the past, the ideal ratio was
    thought to be 66 percent funded by fees with the other 34 percent
    funded out of appropriated funds. The latter was considered to be a
    reasonable offset for the value of materials that the Library acquired
    through the copyright system.
        Most copyright fees are set by Congress. From time to time Congress
    raises these fees, usually at the request of the Copyright Office. Each
    time the fees have been raised to reestablish the 2/3 fee-funded goal.
    The most recent increase was in 1991, when the fee was raised to $20.
        In the 104th and now in the 105th Congress, the House of
    Representatives passed legislation that gives the Register the
    authority to set the basic fees, subject to Congressional veto. The
    Senate did not act on this legislative proposal before adjournment of
    the 104th Congress and the legislation is now pending before the Senate
    (S. 506). The legislation would also authorize the Library to pay
    arbitrators involved in the settlement of royalty distribution
    proceedings directly with funds coming from the relevant royalty pool.
    Currently, the parties to an arbitration proceeding pay the
    arbitrators. The fiscal year 1997 budget authorized the use of
    offsetting receipts to pay the arbitrators pending approval of the
    authorizing legislation. We are again requesting the authority to use
    offsetting receipts in the fiscal 1998 budget.
        Early passage of this legislation is critical, since the Copyright
    Office is severely hampered by a lack of staff in several essential
    areas, and the registration and issuance of certificates is
    unacceptably now taking more than 18 weeks.
        The services provided by the Copyright Office are important both to
    copyright owners and to the economy. To provide these services in a
    reasonable time frame will require additional personnel, which in turn
    requires enactment of fee-setting authority early in the 105th
    Congress.
        We believe that this is relatively non-controversial legislation
    that both the majority and minority of the Senate Judiciary Committee
    will support. Because this legislation is essential for the budget, we
    request the help of the Appropriations Committees in expediting its
    consideration.
        Early in the 105th Congress, we will also seek approval, as we have
    for the past several years, of legislation to implement improvements in
    our financial management as recommended by GAO and by recently
    completed management studies. A key element needed to improve our
    financial management practices is a revolving fund to operate fee
    service activities. Particularly urgent is our need for revolving fund
    authorization to continue operating the Library's overseas Cooperative
    Acquisitions Program on the same financial basis as has been done so
    economically for 30 years. The General Accounting Office sent a letter
    to the Library at the end of January which stated that the Library
    could not continue to retain and use all of the funds collected for
    operating costs without clear legislative authority. Without new
    revolving fund authority to operate this Cooperative Acquisitions
    Program, the Library would need to end a cost-effective, widely
    appreciated service which benefits nearly 100 research libraries
    throughout the nation.
        The Library is seeking authorization for an Advisory Commission to
    guide the planning of its bicentennial in the year 2000. The membership
    will be largely Congressional, but will also include private citizens
    and representatives from other branches of government as well as the
    library and educational communities. The Congress of the United States
    created our oldest Federal cultural institution, has sustained and
    improved it over the years, and deserves to receive public credit and
    visibility at this 200th birthday as the greatest library patron of all
    time.
        Finally, the Library continues to work closely with the Board of
    Trustees of the American Folklife Center to pursue permanent
    authorization for the Center, and at a meeting last month, the Board
    adopted draft legislative language which is planned to be introduced in
    Congress later this year.
                                    summary
        The Library's proposed fiscal 1998 budget supports the Library's
    mission and priorities. Thanks to the foresight and continuing support
    of the Congress, the Library of Congress has become the nation's
    principal knowledge reserve. The Library's ability to acquire,
    organize, preserve, and make increasingly accessible its unique
    resources is of critical importance to our knowledge-based democracy
    and to legislative policy-making.
        In only three years, the Library of Congress will mark its
    Bicentenary. By funding fully the Library's fiscal 1998 budget request,
    the Congress would prevent further staff reductions and the erosion of
    core programs that have already been reduced as a result of unfunded
    price level increases and other factors. This budget will enable the
    Library to improve internal operations through the use of new
    technology, to tighten the security of its staff and collections, and
    to position the Library to move into the 21st century with sufficient
    state-of-the-art services for the Congress and the Nation in the
    information age.
        For fiscal 1998, we submit a budget request that will enable us to
    continue to make the major contributions to the American people that
    Congress has supported for 197 years through its Library.
                                     ______

     Attachment 1.--The Mission and Strategic Priorities of the Library of
                                    Congress
                                    mission
        The Library's mission is to make resources available and useful to
    the Congress and the American people and to sustain and preserve a
    universal collection of knowledge and creativity for future
    generations.
                                   priorities
        The first priority of the Library of Congress is to make knowledge
    and creativity available to the United States Congress.
        The second priority of the Library of Congress is to preserve,
    secure and sustain for the present and future use of the Congress and
    the nation a comprehensive record of American history and creativity,
    and a universal collection of human knowledge.
        The third priority of the Library of Congress is to make its
    collections maximally accessible to (in order of priority): the
    Congress, the U.S. government more broadly, and the thinking and
    creative public.
        The fourth priority is to add interpretive and educational value to
    the basic resources of the Library.

                                 ATTACHMENT 2.--LIBRARY OF CONGRESS COMPARISON OF APPROPRIATIONS, STAFF, AND WORKLOAD STATISTICS
                                                  [For the fiscal years 1992, 1993, 1994, 1995, 1996, and 1997]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Fiscal year--
                                          ------------------------------------------------------------------------------------                     Percent
                                                                                                                     1997       Change 1992-97     change
                                               1992          1993          1994          1995          1996        projected
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Library appropriations--actual.......  $328,170,000  $334,316,000  $330,864,000  $348,230,000  $352,399,000  $361,896,000     +$33,726,000        +10.28
    Full-time equivalent [FTE] positions
     (appropriated)......................         4,549         4,492         4,163         4,180         4,114         4,107             -442         -9.72
    Size of Library collections..........   101,395,257   104,834,652   107,814,587   108,433,370   111,080,666   113,580,666      +12,185,409        +12.02
    Workload statistics:
        Unprocessed Library arrearages...    33,576,196    27,456,787    25,431,296    22,491,071    20,970,523    18,900,000      -14,676,196        -43.71
        CRS--requests and services
         provided Congress...............       645,000       607,000       536,000       492,000       487,000       500,000         -145,000        -22.50
        Loans of collections to Congress.        48,790        43,876        43,465        36,368        31,026        35,000          -13,790        -28.26
        Copyright claims registered......       606,253       600,000       530,332       609,195       550,422       560,000          -46,253         -7.63
        Copyright inquires...............       430,773       433,700       402,163       500,746       432,397       450,000          +19,227         +4.46
        Services to the blind and
         physically handicapped [BPH]--
         readership......................       761,300       767,800       777,300       772,100       777,500       782,500          +21,200         +2.78
        BPH:
            Books and magazines; total
             circulated..................    21,284,200    21,802,200    22,586,000    22,909,400    23,100,000    23,300,000       +2,015,800         +9.47
            New braille and audio books
             and magazines titles........         2,206         2,322         2,327         2,328         2,568         2,309             +103         +4.67
        Print materials cataloged........       266,793       260,957       279,809       276,348       289,509       300,000          +33,207        +12.45
        National coordinated cataloging
         operation [NACO]:
            Library of Congress
             contribution................       122,861       118,921       114,333       124,911       115,714       115,800           -7,061         -5.75
            Outside contribution.........        61,730        75,794        78,176        96,655       106,182       120,000          +58,270        +94.39
        Exhibits, displays, and
         publications (funded by
         appropriations).................            35            31            31            27            15            18              -17        -48.57
        Regular tours....................        44,440        27,954        29,952        47,300        47,847        48,000           +3,560         +8.01
        Reference service................     1,326,945     1,306,264     1,198,358     1,145,757     1,129,952     1,200,000         -126,945         -9.57
        Main Reading Room and five other
         reading rooms hours per week....            78            69            65            65            65            65              -13        -16.67
        Items circulated.................     2,522,620     2,345,151     2,403,002     2,289,981     2,175,075     2,300,000         -222,600         -8.82
        Preservation treatment--original
         format..........................       269,388       304,134       288,111       339,636       274,086       290,000          +20,612         +7.65
        Mainframe computer transactions..    97,372,626   112,491,847   152,095,306   197,216,679   204,297,492   210,000,000     +112,627,374       +115.67
        Machine readable cataloging
         [MARC] records..................    23,981,266    24,670,791    25,090,965    26,100,661    26,320,667    27,000,000       +3,018,734        +12.59
        Internet transactions (LOCIS,
         MARVEL, worldwide web, and
         THOMAS public transactions) \1\.            NA     7,028,995    38,422,986    92,873,807   134,416,660   175,000,000     +167,971,005     +2,389.69
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Comparison based on 1993-97 data.

    NA: Not available.

    Attachment 3.--Total Library appropriations--Actual full time equivalent
    (FTE) positions

                                                                Total actual
                                                                       FTE's
    Fiscal year:
        1992.......................................................... 4,549
        1993.......................................................... 4,492
        1994.......................................................... 4,163
        1995.......................................................... 4,180
        1996.......................................................... 4,114
        1997 (projected)...........................................\1\ 4,107
        1998 (requested).............................................. 4,203

    \1\ Cumulative decrease of 442 FTE's or 9.7 percent from 1992 to 1997.
    ---------------------------------------------------------------------------
                                     ______

                     Prepared Statement of Marybeth Peters
        Mr. Chairman and Members of the Subcommittee: I appreciate the
    opportunity to present the budget request of the Copyright Office for
    fiscal year 1998.
        The Copyright Office's duties and responsibilities include issuing
    certificates of registration and recording statutory licenses and other
    important documents in an accurate, reliable and timely manner and
    creating and maintaining a public record of these actions.
    Additionally, it oversees and administers the copyright arbitration
    royalty panel system (CARP's), provides technical assistance on
    copyright to the Congress and to Executive Branch agencies, provides
    information services to the public and serves as a resource to domestic
    and international copyright communities. Importantly, it supports the
    Library of Congress, and thereby Congress and the nation, by obtaining
    and making available copies of copyrighted works for the Library's
    collections.
        Copyright is one of the shining stars of our economy. Domestically
    and internationally the copyright industries (those who produce and
    distribute computer software, books, music, motion pictures, television
    programming, recordings, and databases) are at the forefront of our
    economy, and copyrighted works are one of our leading exports. The
    copyright industries and those who support them account for almost 6
    percent of our Gross National Product.
        For the past two years you have heard references to the ``national
    information infrastructure,'' the ``information society,'' the
    ``information superhighway,'' and the ``global information
    infrastructure.'' All these terms refer to the merging of computer and
    communications technology whereby copyrighted works in digital form
    travel all over the world. Domestically and internationally we are
    adjusting our copyright norms to bring us into the 21st century and to
    ensure copyright owners that their rights will be protected. Two new
    treaties which included ``digital agenda issues'' were concluded in
    Geneva, Switzerland on December 20, 1996. Protection of American
    creativity through copyright protection is critical to our continued
    progress and prosperity. The Copyright Office and the Library of
    Congress play a vital role in all this.
        Timely action by the Copyright Office, and complete, reliable and
    objective records of copyrights showing their authorship, ownership and
    legal status as well as licensing information are essential to
    copyright owners. Many benefits are tied to registration; United States
    copyright owners may not initiate a copyright infringement suit without
    first registering with the Copyright Office or without obtaining the
    Office's refusal to register. Certificates of registration along with
    certified copies of transfers of copyright ownership are relied on not
    only by our courts but by customs officials, foreign courts and various
    rights organizations.
        Despite several setbacks during the past year, the Office managed
    to accomplish much work. We processed approximately 609,000 claims
    representing more than 700,000 works and recorded more than 16,600
    documents containing more than 200,000 titles. Our requests for public
    information rose to 432,000. The Licensing Division collected
    approximately $187 million in royalty fees.
        There were several firsts in 1996.
      --On February 27, 1996, the first claim was received via the Office's
            Electronic Registration, Recordation and Deposit System
            (CORDS); the submission came from a graduate student at
            Carnegie Mellon University who electronically submitted for
            registration her doctoral thesis in computer science.
      --The first copyright arbitration royalty panel, which dealt with
            more than $550 million in cable royalties for the years 1990-
            1992, was concluded. The arbitrators delivered their final
            report in August, followed by the recommendation of the
            Register of Copyrights to the Librarian of Congress, who issued
            his decision in October.
      --The first claims to copyright and documents concerning rights came
            in under the Uruguay Round Agreements Act which restored
            copyright protection to millions of foreign works on January 1,
            1996.
        Notwithstanding these and many other accomplishments, the Office
    lost ground in providing essential copyright services, and we are
    currently in a bind.
        In fiscal 1980 with a staff of 628 full time employees (FTE's) we
    processed 483,000 claims; in fiscal 1996 with a staff of 471 FTE's, we
    processed 609,000 claims. Thus, a staff which is reduced by 25 percent,
    processed a 26 percent increase in claims. This is even more
    remarkable, given the direction of the Office to expand its group
    registrations--that is, the use of a single application to encompass
    multiple works at a reduced fee. Group registration is possible for:
    unpublished works that are authored and owned by the same individual;
    serials; daily newspapers; newsletters; databases; and works whose
    copyright protection was restored under the Uruguay Round Agreements
    Act. Group registrations were established to encourage publishers of
    works that the Library needs for its collections to register their
    works immediately after publication, and in certain cases to ease the
    burden on individual creators. The result is that the number of
    registrations decreases but work does not decrease proportionately
    since each individual work in the group must be examined.
        The reality is that today we are confronted with an unacceptable
    backlog. During the past year, we coped with the backlog to some extent
    by using overtime and temporary employees. However, the steady loss of
    trained professional staff (particularly examiners, whose number fell
    from 64 FTE's to 49 FTE's in three years, and whose expertise cannot be
    replaced with temporary staff) resulted in the processing time for
    registration going from the norm at the beginning of 1993 of six weeks,
    to an average of 12 weeks in 1994 and 1995, and then, as a result of
    additional losses in the examining corps, to the current time of 18
    weeks.
        This unacceptable time frame must be reduced; otherwise, the
    copyright system will collapse--copyright owners will not be able to
    pursue infringers in a timely manner and will suffer irreparable harm.
    Furthermore, these excessive delays cause much additional work in the
    form of numerous inquiries about the status of in-process claims.
        To turn the situation around, the Copyright Office is requesting 14
    additional positions ($538,953) to support the processing of claims in
    a reasonable time. This would enable the Office to cope with the
    current work until fiscal relief comes in the form of legislation which
    would allow the Office to adjust fees as needed.
        Let me explain my reference to fee setting legislation. Two years
    ago I recognized that the Office needed additional funding to cover its
    basic services. I sought legislation to allow us to: (1) raise the
    existing fees in any year through a cumulative adjustment based on the
    rise in the consumer price index; and (2) allow us to invest a
    percentage of our prepaid fees in U.S. interest-bearing securities. The
    House passed legislation giving the Office fee setting authority; the
    language of the House bill was incorporated in S. 1961 at the end of
    the legislative session last year. Unfortunately, time ran out and the
    Senate adjourned without taking action on this.
        The House passed similar legislation on March 18, 1997 (H.R. 672).
    Mr. Hatch, chairman of our oversight committee, introduced the same fee
    provisions on March 20, 1997 in S. 506; that bill has cleared all
    committees and is awaiting action by the full Senate. Hopefully, the
    Senate will pass this bill in the near future. However, even if enacted
    within the next two months, the basic fees could not be raised until
    late fiscal 1999 or more likely fiscal 2000 due to the need to conduct
    a fee study, propose a fee schedule and hold hearings on that schedule,
    finalize a schedule to submit to Congress, which has 120 days to review
    the schedule and if it disagrees, reject it.
        Meanwhile, it is important that the Copyright Office not only
    maintain its service, but that it continue to development and implement
    its electronic registration, deposit and recordation system (CORDS).
    This system, which is an essential investment in the future, is
    critical to the Copyright Office and the Library of Congress. It will
    streamline our internal procedures and ultimately lead to major savings
    and improved service. It will provide the Library with the vast array
    of information products that are being created and disseminated in
    digital form.
        With respect to the Copyright Office, the benefits of the system
    are impressive. Today it takes 6 FTE staff members to handle 10,000
    claims annually; with CORDS fully implemented, this will drop to 2.5
    FTE staff members. Even where the full CORDS system is not used, i.e.,
    Mixed CORDS, where the application is received electronically and the
    hard copy is sent separately, results in savings. The number of FTE
    staff members needed to handle 10,000 claims in such submissions drops
    to 4.5. Additionally, there are nonpersonal savings such as postage,
    space, printing and supplies, and the processing time for claims
    submitted through CORDS drops dramatically thereby benefitting the
    copyright communities and the public.
        CORDS is at a crucial juncture. During fiscal year 1998, the
    Library and the Copyright Office must take over the operation of CORDS
    from our expert consultant, the Corporation for National Research
    Initiatives. Additionally, CORDS, which uses the latest technology,
    must be integrated with existing automated systems. It must be expanded
    to additional user platforms, and a more powerful database engine is
    needed to handle an increasing volume of transactions.
        Additional development work also is needed to expand the system to
    handle all of the different formats in which works are being
    distributed. At present, the system can only handle text and images;
    but in the future, it must also handle sound recordings and audiovisual
    productions.
        Finally, we must begin to train Copyright Office staff as well as
    copyright owners to use the system. To accomplish these goals, which
    will move this project from the testbed stage to a production system,
    we are requesting five additional technical positions--two program
    analysts and three computer specialists ($304,179), which are essential
    for development and implementation activities.
        Let me now turn to security of the collections. We are asking for
    the authority to hire six mail technicians ($160,072) and to spend
    $82,000 for security targets and accession labels. The Copyright Office
    is the front door for copies that come to the Library's collection
    through the copyright system. It is important that security controls
    are attached to the copies at the earliest possible moment.
        In 1993 the Office, with the assistance of the Collections
    Management Division of Library Services, began targeting hardbound
    books. Approximately 71,000 books are targeted annually.
        The Copyright Office is requesting funding so that targets or
    accession labels can be attached to all items (CD's, videotapes,
    architectural drawings, prints, audio tapes, sheet music, microfilms,
    CD-ROM's, etc.).
        There is one additional matter. The Copyright Office is seeking
    legislation which would allow the Library to directly pay the
    arbitrators in distribution proceedings with funds coming from the
    relevant royalty pool. Currently, parties appearing before a copyright
    arbitration royalty panel must pay the arbitrators themselves. If this
    legislation is enacted, (it is included in the bill allowing the Office
    to set fees), we will need to continue the authority Congress approved
    in fiscal 1997 to expend up to $1.8 million from offsetting collections
    to pay the arbitrators engaged in distribution proceedings in fiscal
    year 1998.
        Thank you, and I welcome your questions which I would be pleased to
    answer now or more fully in writing.
                                     ______

                   Prepared Statement of Daniel P. Mulhollan
        Mr. Chairman and Members of the Subcommittee: I am pleased to
    appear here today to discuss the fiscal year 1998 budget request for
    the Congressional Research Service.
        As I hope each of you has confirmed in your experience, the
    Congressional Research Service is your organization. The Congress has
    given CRS the task of providing the best information, research, and
    policy analysis, in contexts and formats you can apply directly to each
    stage of lawmaking. You expect our work to be reliable, accurate,
    unbiased, timely, and confidential. You want us to be efficient in how
    we manage and effective in what we do--providing quality products and
    services.
        Our budget request seeks funding to support two major priorities
    that the Service must meet in fiscal year 1998 to carry out its role
    successfully and to continue to fulfill your expectations. First, we
    must sustain the quality, quantity, and scope of work that the Congress
    expects from the Service, including completing the specific activities
    that the Congress directed the Service to undertake in fiscal year
    1997. Second, we must prepare for the potential concentrated loss of a
    large number of CRS professional staff due to retirement.
        To meet these priorities we are requesting a total budget increase
    of $4,189,000 in fiscal year 1998. Three-quarters of this increase,
    $3,051,127, is necessary to provide current services and covers
    mandatory pay and price-level increases. The recent budget agreement
    includes a proposal that would increase CRS's mandatory costs by
    $432,000; these additional costs are not included in the budget request
    before you. We also are asking for $1,137,873 to undertake a major
    initiative to address the second priority--provide a temporary increase
    in staff in order to manage the anticipated retirements of a large
    number of CRS staff and to ensure continuity in our services. The
    request maintains the current proportional funding split of
    approximately 90 percent to staff costs and approximately 10 percent to
    nonpersonals. Our priorities and challenges are outlined below.
    our highest priority: sustain the scope and enhance the quality of crs
                                    services
        I would like to review briefly the work we undertook in fiscal year
    1996 that demonstrates our commitment to meeting your needs.
        The Congress called on CRS for information and analysis on
    approximately half a million occasions. In response to these requests,
    we created more than 1,000 new written research products. We delivered
    nearly 2,800 custom, confidential memoranda and gave 2,600 in-person
    briefings and consultations. More than 690,000 copies of our reports
    and issue briefs were distributed to the Congress last year.
        CRS staff provided research and analysis to Members and
    congressional staff on hundreds of legislative issues: on sweeping
    changes in welfare and immigration law, health care legislation, social
    security and retirement, wages and employment, telecommunications
    reform, the line-item veto, taxes, banking and finance reform, the Farm
    Bill and agricultural concerns, environmental issues, juvenile crime,
    and research and development policy. In addition, we covered issues
    related to the defense budget and to U.S. relations with Russia, China,
    and Japan, and monitored the situations in Bosnia and the Middle East.
    Strategic Initiatives
        The Congress has undergone significant changes in recent years, and
    to respond CRS has undertaken several important strategic management
    challenges focusing on improving our services. In fiscal year 1996 our
    strategic initiatives produced a number of positive results, on which
    we continue to build.
        Budget and Appropriations Process.--A CRS analysis of Senate
    activity indicated that more than 70 percent of Senate roll call votes
    on the floor in 1996 was devoted to budget-related matters. As budget
    issues have increasingly become the focus of congressional work, CRS
    has enhanced its analysis of budget and appropriations issues and
    delivery of this work to the Congress. For example, new electronic
    formats available on the CRS Home Page have allowed the Service to
    present its analysis of appropriated measures in a dynamic environment
    that leads the user directly from the CRS report to relevant
    congressional and executive branch documents. In mid-March we met with
    the majority and minority staff of the Senate Appropriations Committee
    to discuss how CRS is analyzing and presenting budget and
    appropriations information. In addition to making this information
    available, we continue to analyze the implications of budget and
    appropriation issues as they impact specific policies and programs.
    Ongoing work with our sister agencies, CBO and GAO, seeks to improve
    the exchange of budget information.
        Impact of the High Turnover of Members of Congress.--In responding
    to high turnover in the membership of the Congress, a recurring pattern
    over the past three Congresses (with 39 new Senators coming on board
    since the November 1992 general election), we continued to offer
    assistance tailored to the unique needs of new Members. This assistance
    included organizing new Member seminars and preparing new products on
    public policy issues designed not only to meet the challenges of new
    Members and staff, but also to address the needs of returning Members
    and staff taking on new assignments. This year we intensified our
    efforts for the 105th Congress by scheduling visits to all new Member
    offices to brief Members and congressional staff about the services CRS
    provides. We are honored that the Senate Committee on Rules and
    Administration, in conjunction with the joint leadership, asked CRS to
    conduct the policy sessions for new Senators of the 105th Congress. We
    particularly appreciate the positive comments about the program by
    Chairman Warner, who personally attended a number of the sessions.
        Other Responses to Congressional Needs.--In addition to these
    efforts, we also are working closely with the Congress to apply new
    technology to the work of the legislative branch, to emphasize the
    importance of objectivity and nonpartisanship in CRS products and
    services, to review and improve CRS capabilities concerning the
    devolution of federal programs to the states, and to develop a strategy
    to allocate resources in light of legislative branch budgetary
    constraints.
        I am pleased to report that during the past year these initiatives,
    which drew upon the resident expertise within CRS, have enhanced the
    quality of our congressional services. I am providing for the record my
    report entitled ``CRS Strategic Goals for Meeting Changing Needs of the
    Congress,'' which provides a more detailed account of our work in these
    areas.
    Service Improvements
        I also would like to bring you up to date on several other service
    improvements we have been working on for the past few years.
        First, the system we use to record and track inquiries from the
    Congress--the Inquiry Status and Information System (ISIS)--has been
    replaced by a new, networked request system (ISIS 96). This new system
    offers improved capabilities for assigning, monitoring, and responding
    to the high volume of congressional requests CRS receives each day. As
    the original system, which was installed 18 years ago, began to fail,
    it became critical to replace the system with one that will accommodate
    and more efficiently process the large number of congressional requests
    we receive.
        The new ISIS 96 is an integral element in our ability to provide
    timely, efficient responses to your requests and is serving as the
    backbone of our efforts to build an integrated management information
    system. In recognition of the critical nature of the system, I want to
    thank the Library of Congress for its continued support in this
    replacement effort and its cooperation in sustaining the system's
    reliability and ensuring its security.
        Second, the CRS Home Page makes available online exclusively to
    congressional offices all CRS issue briefs and numerous reports, as
    well as other linkages to resources related to the legislative work of
    the Congress. Through our Home Page the Congress has integrated access
    to a wide range of products and information. This service is now
    readily accessible electronically to Members and staff 24 hours a day.
        Third, we continue to improve the timeliness and accessibility of
    the Legislative Alert, our weekly listing of selected CRS products that
    focus on legislative issues expected to receive floor action in the
    Senate or the House. The Legislative Alert now is faxed to all
    congressional offices at the beginning of each week that Congress is in
    session; it is also available on the CRS Home Page. We appreciate the
    support and cooperation of the leadership of both chambers in assisting
    us with timely identification of these legislative issues.
        Fourth, we have been working to enhance information security at
    CRS. Growing reliance on local networks, the World Wide Web, and linked
    systems and documents makes it imperative for CRS to maintain vigilance
    against unauthorized access or manipulation of information. We have
    formed a permanent CRS systems security team to undertake a
    comprehensive assessment of our security needs. This team will conduct
    ongoing monitoring of CRS obligations as technology and intrusion
    capability evolve, coordinate efforts with the Library, and make
    recommendations when incursions or vulnerabilities are detected. We
    give high priority to the task of protecting the information needed to
    serve the Congress and will take the necessary steps to address
    possible risk of unauthorized penetration of stored material and
    transmissions.
    Specific Congressional Directives
        CRS also is addressing specific congressional directives outlined
    in the conference report that accompanied the fiscal year 1997
    legislative branch appropriation. In that report the Congress asked CRS
    to coordinate the development of a retrieval capability for an
    electronic Legislative Information System for the Senate. The report
    further directed the Library's Information Technology Services office
    to provide the necessary technical support for that effort.
        Mr. Chairman, I am pleased to report that the initial version of
    this new legislative retrieval system provides the text of bills, the
    text of the Congressional Record and the Congressional Record Index
    since the 103rd Congress; summaries of bills and their status beginning
    with the 104th Congress; committee reports on bills for the 104th and
    105th Congresses; and the full text of all active CRS issue briefs. We
    soon will begin to add summaries of legislation back to the 93rd
    Congress.
        The retrieval system also provides links to floor and committee
    schedules and activities; GAO and CBO reports; connections to other
    Senate and House resources such as the Senate's Webster Home Page and
    the Senate Recording Studio's database of current floor debate; and
    access to copies of historical documents such as the Constitution and
    the Federalist Papers.
        In addition, as a result of a joint project initiated by the Senate
    Rules Committee and directed by the Office of the Secretary, a new
    component of the system soon will provide access to the text of
    amendments within minutes of their being offered on the Senate floor.
        In the fiscal year 1997 appropriations report the Service also was
    asked to contribute to meetings and discussions of the Senate Committee
    on Rules and Administration and the Committee on House Oversight in an
    effort to provide for ``the widest possible exchange of information
    among legislative branch agencies with the long-range goal of improving
    technology planning and evaluation.'' An important part of this effort,
    in which CRS has been an active participant, is to eliminate
    duplication, ensure better integration of data and systems between the
    two chambers, and thereby provide more effective service to the entire
    Congress.
        During the next year we will continue to work toward meeting these
    specific directives. We realize the importance of these projects to the
    work of the Congress, and we welcome the opportunity to assist with
    these efforts.
       our challenge: to prepare for the concentrated loss of crs experts
        Mr. Chairman, it is incumbent on me as the Director of CRS to
    apprise you that within a few years, as a result of the age and service
    profile of CRS personnel, the Service will lose a substantial share of
    its most experienced and valued staff through retirements. More than 20
    percent of current CRS staff will be eligible to retire by the year
    2000; more than 50 percent by 2006. The major historical reason for
    this extraordinary proportion of potential retirees is the consequence
    of the Legislative Reorganization Act of 1970, which expanded the
    capacities of CRS in order to match the analytical ability of the
    legislative branch with that of the executive branch. Another
    circumstance that created the current challenge is that, due to
    budgetary constraints, CRS has been unable to fill many vacancies
    during the past decade. Because of the concentration of senior CRS
    staff who are eligible to retire in the next few years, we consider
    projected retirement losses to be one of the greatest challenges facing
    the Service in the future.
    Maintaining Our Information and Research Capability
        Last year we initiated a survey to determine the planned
    retirements and an analysis of implications for our research capacity
    through the year 2006. Such planning is essential if we are to prepare
    adequately for, and manage the impact of, this anticipated loss of CRS
    professional expertise. The survey indicated our projected losses in
    many issue areas, including health policy, social security, tax policy,
    defense budgeting, international trade, constitutional law, crime,
    biomedical policy, environmental issues, agricultural policy, and
    science and technology. The retirees' knowledge of their disciplines,
    their subject expertise, and their legislative experience will be
    exceedingly difficult to replace.
        The succession initiative presented in our fiscal 1998 budget
    request calls for an increase of 60 staff, hired over a three-year
    period; the first year, for example, adds 25 positions. This small
    increase in staffing will be eliminated during the following six years
    through retirements, returning CRS to its present staff size in fiscal
    2006. In addition, this temporary increase is one of a number of
    complementary strategies in our overall plan to minimize the risk to
    our research capacity created by the projected retirements of hundreds
    of senior staff in a short period of time. I emphasize that this
    increase is temporary: it does not represent a permanent expansion of
    the CRS personnel base or of the CRS baseline current services budget.
    Effectiveness and Continuity of Service
        We believe that our succession initiative is an effective approach
    to address significant staff loss, while preserving continuity of
    service to the Congress. While part of our planning for the future
    entails detailing staff within CRS to meet temporary shifts in
    congressional priorities and supplementing staff with consultants where
    feasible, we need to build our long-term ability to maintain quality
    service to the Congress. Let me briefly describe the reasons for
    proposing this initiative.
        First, this succession initiative would allow CRS to hire the
    necessary staff in time to develop the breadth and depth of on-the-job
    knowledge about public policy issues needed to replace departing senior
    analysts and specialists, permit new staff to be mentored by those who
    will soon retire, allow us to increase diversity, and enable the new
    staff to more quickly develop familiarity with congressional processes
    and procedures. This multiyear initiative will require significant
    effort to recruit, select, train, and assimilate new staff.
        Today there are few ``apprentice'' staff working with more seasoned
    CRS analysts. This situation is in contrast to practices that prevail
    in many professional settings where generally there is an opportunity
    to develop planned annual additions to the intellectual base--such as
    associates in law firms, residents in medical settings, junior analysts
    in investment banking--where typically there are planned, annual
    additions to the stock of intellectual capital through multiyear
    apprenticeship programs.
        Second, the initiative would allow new staff the time to acquire
    the appropriate mix of capabilities to serve the Congress:
      --Developing a working knowledge of legislative and budget processes
            as actually practiced.
      --Obtaining experience in examining and presenting issues from an
            unbiased, public policy perspective.
      --Gaining knowledge of, and ability to take into account and convey,
            a broad range of views on issues.
      --Developing a working knowledge of specialized subject-area
            information resources.
      --Establishing contacts with experts in academia, government
            agencies, and elsewhere.
      --Becoming proficient in using technology to acquire and analyze
            information and incorporating it in products for the Congress
            according to prescribed formats and standards.
        In addition, the six CRS-specific qualities that are part of the
    culture of the Service must be developed--objectivity, timeliness,
    accuracy, confidentiality, responsiveness, and resident expertise.
        Third, hiring some staff at the entry level typically brings aboard
    personnel who are familiar with the most recent and advanced
    methodologies and skills being taught or practiced--staff who are able
    to adjust to evolving demands for professional growth and who
    invigorate the institution.
        I want to underscore the importance of continuity of service--or
    the institutional memory, as we often call it--provided by CRS. The
    average tenure of a legislative assistant in the Senate today is 2.8
    years; the average legislative director has been on the job 3.5 years.
    By contrast, our average CRS analyst and information specialist has
    been building expertise at CRS on issues and how they are addressed
    within the legislative framework for 18.5 years. These CRS staff
    provide invaluable expertise, experience, and institutional memory on
    which Members and congressional staff have come to rely.
        I am providing for the record a copy of my report, ``Succession
    Initiative of the Congressional Research Service,'' which provides more
    detail on our succession initiative as well as the skills and expertise
    we seek to maintain.
        Thank you, Mr. Chairman, for allowing me to share with you and the
    other members of this Committee some of our recent accomplishments as
    well as our challenges for the future. We are grateful for the support
    of the Senate Subcommittee on the Legislative Branch in the past, and
    we are committed to working closely with you in the coming years to
    meet the challenges facing both the Congress and the Service.
                                     ______

    Director's Report--Succession Initiative of the Congressional Research
                              Service, March 1997

                               executive summary
        CRS is requesting funds to finance a succession plan designed to
    sustain its research capacity through the expected retirements of over
    half its staff between now and the year 2006. To responsibly manage
    this expected loss of senior capability, the plan would allow CRS to
    hire 60 additional full-time equivalent (FTE) staff over the next three
    years (25 in fiscal year 1998, 25 in fiscal year 1999, and 10 in fiscal
    year 2000) followed by an equal reduction in staff level during the
    following six years. By 2006 CRS would return to its current level of
    747 full-time equivalent staff positions without any interruption in
    the quality of its support to the Congress.
        By 2006, almost 52 percent of CRS staff will be eligible to retire.
        The overall succession plan would allow CRS to hire 60 additional
    full-time equivalent staff over the next three years to begin a
    replacement cycle designed to minimize the impact of the potential loss
    of nearly 400 staff.
        Funding for the succession plan requested for fiscal year 1998
    would allow CRS to hire 25 additional full-time equivalent employees in
    fiscal year 1998 to begin the replacement cycle set forth in the plan.
        The design of the succession plan is to bring new staff to CRS
    before its experts retire so that their institutional memory on issues,
    their knowledge of the legislative process, and the CRS service
    qualities of confidentiality, objectivity, timeliness, accuracy, and
    responsiveness which they have mastered can be passed on. This plan
    seeks to avoid shortfalls in the level and quality of service to the
    Congress during this period.
        The value of the institutional memory of CRS staff to the Congress
    is suggested by the fact that the average tenure of 18.5 years of CRS
    staff is in marked contrast to that of most congressional staff (e.g.,
    less than 2 years for legislative assistant).
        The plan is effective because it allows CRS to hire, train and
    mentor new staff at entry-level salaries.
        This is not an initiative to permanently increase the Service's
    staffing. The succession plan would temporarily adjust the Service's
    FTE's. The proposed initiative anticipates hiring 60 additional FTE's
    over a three year period, with a subsequent net decrease of 60 FTE's
    over the following 6 years. By fiscal year 2006 CRS would return to the
    fiscal year 1997 authorized level of 747 FTE's.
        The Service has determined the highest priority staff needs for
    this initiative and is prepared to undertake a focused recruitment
    effort to expedite the hiring of these additional staff. Some of the
    legislative policy areas where the Service projects the need to act
    quickly are Social Security; Welfare; Transportation; Immigration;
    Crime and Criminal Justice; Agriculture; Military Personnel; Natural
    Resources; and Biomedical Policy.
        The Service will continue to consult with its appropriations and
    oversight committees as this initiative progresses.
        Throughout this effort, CRS will continue to pursue diversity, in
    the racial and ethnic makeup of its future staff, and in experience,
    perspective and skills.
                                  introduction
        By 2006, almost 52 percent of CRS' staff will be eligible to
    retire. Unless planning and training of replacement staff can begin
    soon, CRS' ability to maintain services will be threatened. This, in
    turn, could compromise CRS' role as the primary congressional source of
    analysis and evaluation of legislative proposals as well as
    representational assistance.
    CRS Risk Assessment
        Background.--The CRS mission and staff were greatly expanded by the
    enactment of the Legislative Reorganization Act of 1970. A large
    percentage of staff hired at that time make up the capacity of the
    Service today. Recognizing this, CRS undertook a methodical two-year
    assessment of the threat posed to its services by the prospect of
    concentrated loss of staff due to retirements. This threat and the work
    CRS had underway to address it were also discussed in the 1996 General
    Accounting Office audit of the Library of Congress conducted by Booz-
    Allen and Hamilton. The audit report stated that ``CRS is currently
    conducting planning to sustain its intellectual capital'' which ``can
    alleviate the potential pitfalls and costs of any extreme change in its
    workforce in the future.''
        In order to more clearly define the risk posed, CRS conducted a
    survey of all eligible staff to estimate specific time frames within
    which its staff expected to retire, identify the planned retirements,
    and analyze the implications of those retirements for its research
    capacity through the year 2006. The assessment was conducted in order
    to (1) refine and sharpen the framework CRS uses to identify and
    prepare for congressional priorities over the next decade; (2) identify
    the losses CRS is likely to experience over the next several years in
    specific subject areas and across functional capabilities within CRS;
    and (3) determine what competencies and expertise will be needed during
    that time period to match CRS capacity to congressional needs.
        Findings.--The risk assessment showed that CRS is faced with a
    major threat to its ability to maintain services to the Congress
    resulting from the possibility that over 50 percent of the staff
    (nearly 400 staff) may retire between now and 2006. The policy areas in
    which the Service projects an immediate need include: Social Security;
    Welfare; Transportation; Immigration; Crime and Criminal Justice;
    Agriculture; Military Personnel; Natural Resources; and Biomedical
    Policy.
        The data regarding retirement eligibility, coupled with staff
    projections about when they will actually retire, led to the
    identification of a large number of issue areas where the one or two
    experts in a given policy area could leave at the same time, leaving
    CRS with little or no capacity to provide high-level analysis.
    Fortunately, data show that everyone does not retire on the first day
    of eligibility, but good management necessitates planning for their
    retirement to avoid any major disruption of services.
        Due to budgetary constraints during the past decade, today there
    are few ``apprentice'' staff working with senior CRS analysts. This
    situation is in contrast to practices that prevail in many professional
    settings where typically there are planned annual additions to the
    intellectual base--such as associates in law firms, residents in health
    and medical practices, and junior analysts in investment banking. In
    these fields, regular renewal of the stock of intellectual capital
    occurs through a multi-year apprenticeship program.
        The results of the CRS study of potential retirees and additional
    research and analyses \1\ laid the groundwork for the succession plan
    contained in the fiscal year 1998 budget request.
    ---------------------------------------------------------------------------
        \1\ Several private sector succession planning initiatives were
    useful in assisting the Service develop its plan. Senior CRS managers
    conducted discussions with Motorola and Proctor & Gamble Company to
    learn about how these companies approach succession planning.
    Additional information and insights were also obtained from researching
    succession planning in such companies as Corning Glass, AT&T, General
    Electric, and K-Mart.
    ---------------------------------------------------------------------------
    CRS Succession Plan
        Introduction.--The anticipated loss of nearly 400 experienced
    staff, coupled with the knowledge that it will take 5-10 years to
    replace the breadth and depth of knowledge about the public policy
    issues resident in top level analysts and specialists, led to this
    proposed multi-year initiative. The initiative anticipates a temporary
    increase in staff by hiring 60 additional FTE's over a three-year
    period, with a subsequent net decrease of 60 FTE's over the following 6
    years. By fiscal year 2006 CRS would return to the fiscal year 1997
    authorized level of 747 FTE's. By fiscal year 1998 CRS will be ready to
    recruit in the highest risk areas, and begin the multi-year effort that
    will sustain essential services to the Congress.
        This initiative would allow CRS to hire and accomplish the most
    effective training of new staff before veteran expertise is lost.
    Hiring at the entry-level typically brings aboard personnel who are
    familiar with the most recent and advanced methodologies and expertise
    being taught or practiced--staff who are able to adjust to evolving
    demands for professional growth and who invigorate the institution.
    Failing to anticipate the need for new expertise usually results in
    discontinuities between the departure of an existing expert and the
    hiring of a new one, and reduces capability while a new staffer is
    acclimating to his or her new CRS role.
        In the meantime, CRS will continue to reassign staff to meet the
    most critical needs, and fill vacancies as they occur. However, the
    inability to provide a period of mentorship by retirees will result in
    gaps in coverage and quality of service while new staff members ``get
    up to speed''.
        The purpose of the succession initiative is not to restore staff
    lost through downsizing in past years nor to restore discontinued
    services.
        Projected Costs.--As noted above, the succession initiative is
    based on a temporary increase in staffing--hiring 60 additional staff
    over a three-year period (twenty-five in fiscal year 1998, twenty-five
    in fiscal year 1999, and ten in fiscal year 2000) followed by a net
    decrease of ten FTE's each year from 2001 to 2006--by 2006 CRS would
    return to the present FTE level of 747.
        The following table summarizes the year-by-year costs in comparison
    with the present base, and also shows the net change from one year to
    the next.

                            CRS SUCCESSION INITIATIVE FTE AND COST PROJECTIONS, YEAR BY YEAR
    ----------------------------------------------------------------------------------------------------------------
                                                                  Net change from prior      Net change from fiscal
                                                                       fiscal year           year 1997 (747 FTE's)
                            Fiscal year                        -----------------------------------------------------
                                                                  FTE's        Dollars       FTE's        Dollars
    ----------------------------------------------------------------------------------------------------------------
    1998......................................................        +25     +$1,137,873        +25     +$1,137,873
    1999......................................................        +25      +1,585,146        +50      +2,723,019
    2000......................................................        +10      +1,177,560        +60      +3,900,579
    2001......................................................        -10        -121,962        +50      +3,778,617
    2002......................................................        -10        -364,210        +40      +3,414,407
    2003......................................................        -10        -534,403        +30      +2,880,004
    2004......................................................        -10        -787,452        +20      +2,092,552
    2005......................................................        -10        -972,059        +10      +1,120,493
    2006......................................................        -10      -1,120,493  .........  ..............
    ----------------------------------------------------------------------------------------------------------------

        In projecting the costs of the initiative, a number of assumptions
    were made. First, it was assumed that the fiscal year 1997 staffing
    level of 747 FTE's will be maintained in each year by full funding of
    mandatory costs--cost of living and locality pay increases, for
    example--which will permit rapid refilling of positions which become
    vacant.
        Second, the plan is based on hiring staff at the entry-level,
    typically at GS-9 or GS-11. It is assumed that these new staff will
    perform successfully and will therefore progress at normal rates
    through promotion plans. This is consistent with the mix of positions
    CRS has maintained for decades. As senior staff leave, their positions
    are usually filled at a lower level, and the new hires promoted as they
    demonstrate work at the next higher grade. At any given moment, we have
    staff at different grade levels, each of whom progresses based on
    performance. The funding in the base assumes that there will be such a
    mix of staff at different stages in their promotion plans.
        Third, the cost projections in the table above include an estimated
    cost of living increase for each year, based on Congressional Budget
    Office estimates at the time the proposal was developed. All costs
    cover both salaries and benefits.
        With regard to benefits, the cost of new employees, who are covered
    by the Federal Employee Retirement System (FERS) in place for all hires
    after 1984, is significantly higher than the benefit rate paid for the
    projected retirees, most of whom are covered under the Civil Service
    Retirement System (CSRS). While the actual benefits will vary for each
    individual depending upon the specific elections with regard to health
    and life insurance and other benefit items, on average the
    Congressional Research Service budget must pay approximately 27.2
    percent for FERS employees compared to the average CSRS employee
    benefit cost of 11.8 percent.
        The following table shows the number of staff eligible to retire
    and the additional full-time equivalent positions requested under the
    initiative for each fiscal year.

     CONGRESSIONAL RESEARCH SERVICE STAFF ELIGIBLE TO RETIRE (CUMULATIVE BY
              YEAR) AND ADDITIONAL FTE'S REQUESTED UNDER INITIATIVE
                         [Full-time equivalents (FTE's)]
    ------------------------------------------------------------------------
                                                                  Additional
                                                      No. of        FTE's
                                                    eligible to   requested
                                                      retire      (above 747
                                                   (cumulative)   FTE level)
                                                                     \1\
    ------------------------------------------------------------------------
    Fiscal year:
        1998.....................................            95           25
        1999.....................................           113           50
        2000.....................................           139           60
        2001.....................................           175           50
        2002.....................................           209           40
        2003.....................................           254           30
        2004.....................................           314           20
        2005.....................................           344           10
        2006.....................................           382  ...........
    ------------------------------------------------------------------------
    \1\ Assumes fiscal 1997 funding will be increased each year to cover
      mandatory costs, and departing staff will be replaced to maintain an
      FTE level of 747. The temporary increase in FTE's from 1998 to 2000,
      with a subsequent reduction of these FTE's (to be completed by 2006),
      will permit CRS to mentor a small group of replacement staff in a few
      critical subject areas prior to the retirement of experienced staff.

        Timing.--The concept of the initiative is to hire entry-level staff
    before senior analysts retire. Allowing staff to overlap accelerates
    the learning process through on-the-job mentoring and allows time for
    the orderly transfer of institutional knowledge of public policy issues
    and of the congressional environment and process--knowledge which makes
    CRS so effective in support of the Congress.
        Based on CRS experience with entry-level analysts, several years of
    on-the-job experience are required for a new analyst to become reliably
    self-sufficient and to work with topics of greater complexity in
    meeting the needs of the Congress.
        A period of overlap, which will be possible only with funding for
    additional positions under the succession initiative, is needed for
    entry-level staff to acquire the knowledge of how Congress and CRS have
    dealt with issues in the past, and of the legislative process. Once the
    first group of retirements takes place--and hopefully their
    replacements will already be here as a consequence of this initiative--
    these vacancies will be used to anticipate the next group. Ultimately,
    CRS will replace all of the retirees, but the headstart will allow this
    to occur in an orderly way without disruptions of congressional
    support. The plan to provide a multi-year period of overlap in critical
    subject areas in order to transfer institutional expertise will require
    significant effort to recruit, select and then train and assimilate
    staff into CRS.
        Recruitment.--CRS plans to recruit through a variety of mechanisms,
    with emphasis on a very successful approach used in past years--the
    Graduate Recruit Program. Under this program, CRS has conducted
    intensive recruitment from the graduate public policy schools which are
    found in universities throughout the country. These students represent
    a pool of strong candidates, with good grounding in advanced
    methodological techniques--traits which are necessary to provide
    Congress with a firm foundation for policy decisions. Many Graduate
    Recruits will come for a summer between their 1st and 2nd year. The
    next year, those who are successful will be placed in permanent
    positions. The program provides the opportunity for both CRS and the
    students to assess whether this is the right environment for them; it
    is also an excellent way to attract some of the best students. CRS has
    reached an agreement with its labor union to reinstate the Graduate
    Recruit Program, and is awaiting other required final approvals before
    embarking on this recruitment effort. In addition to Graduate Recruit
    placements, some positions will be filled through the normal posting
    process, or through a Law Recruit Program (a variant of Graduate
    Recruit) designed for law school recruitment.
        It is the CRS practice to pursue the institutional gains derived
    from diversity, in the racial and ethnic makeup of its future staff,
    and in experience, perspective and skills. A critical component of the
    Service's recruitment strategy is to attract professionals who are
    dedicated to public service and who have the greatest potential for
    remaining with the Service over time.
        Alternative Strategies.--The succession initiative is one of a
    number of strategies CRS is already implementing to help maintain its
    research and information capacity. Other strategies include detailing
    and reassigning staff internally, mentoring staff assigned to new
    areas, and using contractors for certain activities.
        As a matter of long-term practice, CRS has reassigned analysts to
    work on issues that require additional support due to immediate
    legislative needs. This past year the Service, with the approval and
    support of its labor organization (CREA), instituted a program that
    allowed for formal ``details''. Under this program the Service
    identifies areas that require temporary assistance as congressional
    priorities shift, notifies staff of the opportunity to provide this
    assistance, and selects from among interested staff to fill this need.
        CRS continues to carefully examine activities to determine which
    are appropriate to contract out and which should be performed with in-
    house staff. The Service has successfully used consultants in a variety
    of subject areas to provide written products when in-house staff either
    do not have a specific type of expertise (actuarial services, for
    example), or when they are fully committed and cannot meet
    congressional deadlines without temporary outside assistance.
        The Service expects that contractors will continue to be an
    important resource, but that if it is to fulfill the mission that
    Congress has established, CRS must maintain a shared pool of resident
    policy experts and information specialists.
    Unique Attributes Required of CRS Staff
        As a service organization CRS has focused its efforts on six
    service qualities that it must meet if it is successfully to fulfill
    the legislative needs of the Congress. These qualities define not only
    the standards which the organization must meet as it performs its
    mission, but also frame the attributes that are essential for its
    staff, both current and future. As CRS undertakes its succession
    planning and focused recruitment efforts, designed to replenish the
    loss of critical expertise, it must do so bearing in mind the special
    skills and talents requisite to the work it performs.
        It is therefore incumbent upon CRS to ensure the necessary period
    of training and mentoring by resident and seasoned experts in order to
    instill these unique skills in those that are hired and who will be
    responsible for providing the continuity of service that the Congress
    expects.
        The attributes required of CRS analysts are a combination of
    subject specialty training, which may be acquired elsewhere, and in-
    house experience developed over time, working in the congressional
    setting with the specific responsibilities of such an analyst. Many of
    these skills are not routinely developed in academic nor in other work
    environments. Acquiring the proper mix of these capabilities requires
    not only talent, but ``time in training'', working along side
    experienced staff who can guide and assist in the learning process.
        These capabilities include, in general:
      --Acquiring working knowledge of legislative and budget procedures as
            actually practiced.
      --Obtaining experience with examining and presenting issues from an
            unbiased, public policy perspective.
      --Gaining knowledge of and ability to take account of a broad range
            of views on issues.
      --Learning to present products and services in the manner and form
            that best matches the needs of the client.
      --Developing a working knowledge of specialized subject-area
            information resources.
      --Establishing contacts with experts in academia, government
            agencies, and elsewhere who have related subject expertise.
      --Becoming proficient in using technology to acquire and analyze
            information and use it in preparing products for the Congress
            in prescribed formats and standards.
        In addition, a summary description of the six CRS-specific service
    qualities is provided below, accompanied by a listing of some of the
    skills required to successfully demonstrate these qualities.
                                  objectivity
    Service Quality
        The hallmark of CRS legislative assistance--that its work is non-
    partisan and objective--must never be compromised. The Congress has
    available to it a wide variety of sources for research analysis and
    information. Unlike most of these sources, CRS adheres strictly to a
    policy of providing products and services which can be relied upon to
    be free of policy advocacy or partisan or other bias. This imprimatur
    of objectivity, combined with the other elements of its service
    quality, makes CRS uniquely valuable in the legislative arena. This
    attribute was central to the purposes for which CRS was created and
    remains essential to its future success.
    Skills Needed
        Acquiring the skill to present policy issues in an objective, non-
    partisan manner devoid of any appearance of advocating a personal or
    institutional viewpoint.
        Learning to remain independent of prevailing paradigms or
    assumptions in order to fairly treat all perspectives.
        Understanding and practicing the requirement that all Member and
    committee clients, regardless of party affiliation, majority or
    minority status, or particular viewpoint receive equal consideration
    and treatment.
        Developing the skill to frame responses in a manner that is clear,
    unambiguous, and minimizes the risk of misinterpretation in an often
    polarized environment.
                                   timeliness
    Service Quality
        The press of congressional business is such that the importance of
    timeliness as an objective for CRS cannot be overemphasized. Indeed,
    the speed with which CRS responds to client demands is unique among the
    many information resources available to the Congress. In order to
    satisfy expectations, the Service must meet or beat all client
    deadlines for legislative assistance and anticipate and be responsive
    to legislative timetables. CRS can only meet complex needs within a
    reasonable time frame if the Service maintains the requisite expertise.
    But in order to successfully meet those needs CRS must also be adept at
    managing conflicting deadlines through the negotiation process,
    anticipating needs to the extent possible, staying abreast of
    legislative timetables as they develop on specific issues, maintaining
    reasonable turn-around times for requests without specific deadlines,
    and insuring that all delivery methods--both manual and electronic--are
    as swift and predictable as possible.
    Skills Needed
        Acquiring the skills to juggle priorities to meet immediate and
    often unanticipated legislative deadlines.
        Developing familiarity with legislative timetables and
    understanding implicit time constraints placed upon staff and Members
    at various stages of the legislative process.
        Fully understanding that information that is late may be of little
    or no value to a congressional client.
        Learning the skill of anticipating the unique needs of
    congressional clients as they work through legislatively active topics
    so that the knowledge base and products necessary to respond to urgent
    needs are available as needed.
        Cultivating a professional demeanor that consistently demonstrates
    the ability to endure pressures and interpersonal tensions natural to a
    fast-paced, high-stakes political environment.
                                    accuracy
    Service Quality
        CRS' goal is to provide 100 percent factual accuracy. The analysis
    and information CRS presents must be accurate and complete whether it
    originates within CRS or with others. CRS does not shade the
    presentation of information or its analyses to influence outcomes. The
    Service places critical thinking and broad and deep subject knowledge
    on top of solid research when undertaking its work for the Congress.
    CRS products and services on legislative matters must be reliable,
    current, and comprehensive. Analysis and information, in whatever form,
    must be current in relation to the time requested, and written products
    must reflect all relevant information available as of their dates of
    release. CRS products should explicitly state the assumptions,
    methodology, and resources relied upon.
    Skills Needed
        Developing the ability to balance the need for timeliness with the
    critical need for accuracy.
        Acquiring the facility to maintain the currency of multiple
    products on a variety of subjects so that they reflect the latest
    developments.
        Becoming adept at the requirement of specifying assumptions,
    methodologies and sources for all analysis and conclusions.
        Developing the ability to make appropriate use of original sources
    while assessing their limitations and attaching appropriate caveats.
                                confidentiality
    Service Quality
        The identity of a congressional client from whom the Service
    receives a request, the subject of such request, and the specific
    products and services provided in response, constitute confidential
    information which CRS will not disclose without prior authorization
    from the client. In meeting that obligation, the Service has drawn
    careful distinctions between written products which are advertised as
    available for congressional distribution, and those written
    specifically for an individual client with expectations of
    confidentiality. In the absence of specific authorization to the
    contrary, CRS always presumes a confidential relationship and acts
    accordingly.
    Skills Needed
        Becoming familiar with the rules and procedures pertaining to the
    handling and sharing of all congressional information.
        Developing a trust relationship with all congressional clients.
        Becoming facile at working simultaneously for multiple clients with
    different viewpoints on the same or similar subjects without
    compromising confidentiality.
                                 responsiveness
    Service Quality
        As a support agency working closely with and exclusively for its
    congressional clients, CRS is expected to provide assistance which best
    meets specific congressional needs. Thus, CRS must respond with the
    most useful, legislatively-relevant products and services. The utility
    of CRS services depends upon clarity, brevity, product format, and
    sensitivity to audience expectations and levels of knowledge. To
    achieve the objective of being ``responsive'' the Service must maintain
    close contact with Members and staff generally, as well as with
    specific committee and Member offices. These relationships allow CRS to
    become familiar with the needs expressed by clients (and perhaps more
    importantly, needs which may not be expressed) and the nature of the
    intended use of requested responses. This close relationship also
    facilitates negotiations between clients and CRS staff as to
    appropriate responses.
    Skills Needed
        Developing the skills of lucidity and brevity.
        Understanding client needs and the legislative context in which
    they arise.
        Learning the most appropriate way to present information and
    analysis in the manner and form that best meets the needs of the
    clients and is most useful to them.
        Developing the skill to present complex issues in language which is
    easily understood and free of jargon; developing the ability to write
    concisely in the vernacular of the legislative arena and to translate
    the language of specific disciplines into common parlance.
        Becoming skillful at framing the discussion of issues to contribute
    to the likelihood of achieving common ground for legislative
    consideration and debate.
                               resident expertise
    Service Quality
        The breadth of knowledge, level of expertise, and legislative
    sensitivity of resident CRS staff are the underpinnings of all support
    the Service provides to the Congress. CRS must provide expert, multi-
    disciplinary, and analytical support on all legislative matters before
    Congress. The concept of ``one-stop shopping'' for the Congress is
    critical in a time of wide ranging and complex legislative issues. So
    too, the institutional memory provided by a diverse CRS staff (made up
    of individuals who generally have tenure well beyond that of
    congressional staff) is of great value in dealing with recurring
    substantive and procedural legislative issues. CRS integration of
    knowledge from a variety of disciplines, such as law, economics, the
    social sciences, political science and international relations, as well
    as science, technology, natural resources, and library and information
    sciences provides the Congress with a unique source for analyses of the
    multi-faceted issues before it. This multi-disciplinary staff enhances
    CRS' ability to anticipate legislative issues and to provide creative,
    interdisciplinary analyses. This knowledge base must be maintained and
    nurtured to assure that the quality of service is not compromised.
    Skills Needed
        Learning to apply academic training and experience in the context
    of lawmaking.
        Developing expertise in legislative procedures and legislative
    branch organization which cannot be acquired elsewhere.
        Applying subject knowledge in an interdisciplinary context, working
    closely with CRS experts covering virtually all public policy areas.
        Acquiring experience over time which becomes invaluable
    institutional memory that can be used to assist Members and staff on
    matters and precedents that pre-date their tenure in the Congress.
        Learning how to remain constantly vigilant to new methodologies,
    programs, and research designs that could be applied to analytical
    research.
        Adapting to information and research technologies available to CRS
    and the Congress and utilizing those technologies to best serve the
    client.
                                   conclusion
        The past 25 years of experience suggests that it takes at least
    five years for an entry-level analyst to develop subject expertise and
    knowledge of the legislative environment sufficient to handle complex
    issues in the way a senior analyst can. Brief examination of the CRS
    service qualities reinforces this need to anticipate and prepare for
    internal staff turnover. New analysts can make this transition more
    easily if mentored for a few years by senior staff--in this way the
    previous legislative efforts become part of the knowledge base and
    improve analysis of each issue. If the Service waits until all of the
    retirement-eligible leave before replacing them, it will lose the
    opportunity for such mentoring and will reduce its analytical capacity
    in a large number of critical areas during the period that new staff
    are developing expertise.
        The average tenure of a legislative assistant in the Congress today
    is less than 2 years. The average Legislative Director has only been on
    the job for less than 3 years. Congress cannot obtain the analysis it
    needs, set against the knowledge of what Congress has done in the past
    and an in-depth understanding of the legislative process, unless it
    develops and has continuing access to a shared staff.
        As discussed above it is clear that it takes years for a staff
    member to develop the breadth and depth of expertise Congress needs to
    provide close support on complex public policy issues. This expertise
    develops from basic subject expertise (which new staff have) combined
    with knowledge of how Congress has addressed issues in the past, and
    from an in-depth understanding of the legislative process which takes
    years to acquire.
        The succession initiative is one of a number of strategies CRS is
    already implementing, including detailing and reassigning staff
    internally, increasing mentoring, and using volunteers for certain
    activities. These measures, while important in providing continuity,
    cannot in themselves remedy the cumulative expected loss of
    institutional memory and capability created by anticipated staff
    retirements.
        The purpose of the initiative described here is to provide a multi-
    year mentoring and development period for new staff to be trained by
    retiring staff. In this way, CRS hopes to manage the transition
    smoothly, and maintain its current analytic capacity.
                                     ______

     Director's Report--CRS Strategic Goals for Meeting Changing Needs of
                          the Congress, December 1996

                      accomplishments and work-in-progress
                                   memorandum
                        Congressional Research Service,
                                           Library of Congress,
                                                     December 27, 1996.
    TO: All CRS Staff.
    FROM: Daniel P. Mulhollan, Director Congressional Research Service.
    SUBJECT: Report on work toward CRS strategic goals.

        One year ago, in December 1995, I convened senior CRS managers for
    a two-day session to examine evolving changes in the character and the
    work of the Congress and to identify goals and initiatives for assuring
    that CRS would continue to strengthen its support for the Congress by
    anticipating and meeting its changing needs. At this focused and highly
    productive session we identified six significant, strategic goals for
    CRS and a number of specific actions for achieving these goals.
        The six strategic goals for enhancing CRS service to the Congress
    are (1) improving our ability to meet information needs as the Congress
    addresses public policy issues increasingly through the budget and
    appropriations process; (2) making creative and effective use of
    technology to improve our services and internal work processes; (3)
    strengthening our effectiveness in providing objective support to the
    Congress during a time of increased political and ideological
    polarization; (4) positioning ourselves to meet increasing needs for
    research and analysis regarding state and local developments; (5)
    developing a framework for decision-making about resource allocation in
    an environment of constrained budgets; and (6) providing support
    specifically designed for new Members and staff as they assume their
    duties, as well as for returning Members and staff taking on new
    assignments.
        Over the last year, support for achieving these goals has come from
    all quarters of CRS. Approximately 150 CRS employees, representing all
    divisions and offices, volunteered to serve on six goal-oriented teams.
    These team members, in turn, consulted widely throughout the Service to
    gather information, to solicit suggestions, and try out new ideas. They
    conferred with many individuals and consulted larger groups, including
    conducting consultative management meetings in each division.
        I am pleased to report that all specific actions identified by
    senior managers in support of the six strategic goals have received
    effective, conscientious attention. Most of the originally specified
    actions, and some additional tasks identified by teams while pursuing
    their work, have been completed. Other actions, by their nature,
    require and are receiving continuing attention. Those relating to the
    sixth goal, serving needs arising from increased congressional turn-
    over, are being pursued in the context of the arrival of the 105th
    Congress.
        Because the six strategic goals derive directly from the needs of
    the Congress and because we have made significant progress toward
    achieving these goals, I have highlighted these accomplishments before
    our appropriations and oversight committees and in discussions with
    individual Members. Uniformly, congressional reactions have been
    favorable.
        As a direct result of work on the six strategic goals, CRS has
    already experienced important improvements in its service to the
    Congress and can look forward to further significant gains. These gains
    come from establishing or refining organizational arrangements and
    responsibilities in such areas as technology policies, budget and
    appropriations coverage, and sharing of Federal/State resources across
    LC/CRS organizational lines. They come from reviewing and improving CRS
    policies and procedures including clarifying and emphasizing
    objectivity standards, developing criteria for allocating resources,
    and setting performance objectives for the evolving Legislative
    Information System. They also come from a number of more specific
    actions such as adopting WordPerfect 7.0 as the next generation word
    processing package for CRS and initiating appropriate application
    tests, enhancing the CRS Home Page, including information resource
    pages, and being selected by both the House and the Senate to provide
    the official public policy orientation for new Members.
        This report summarizes accomplishments and work-in-progress for
    each of the goal-oriented teams. I want to thank each of you for your
    direct and indirect support of this process. Our work has been both
    productive and effective with highly constructive results. We have
    accomplished many goals we set for ourselves. These accomplishments are
    reflective of the thoughtful, creative, and analytical staff of CRS. I
    thank you all for the time and energy you continue to devote to ensure
    that CRS remains a unique and highly valued resource to the Congress.
                               budget focus team
        The Budget Focus Team has enhanced CRS capacity to meet the
    analytical and information needs of the Congress as it addresses public
    policy issues increasingly through the budget and appropriation
    process. The team reviewed the manner in which the entire Service
    addresses budget and appropriations-related issues. This team worked in
    concert with a pre-existing team (the Appropriations Team). Beginning
    with fiscal year 1996, the Director's Office worked with an
    interdivisional team whose members became authors of reports analyzing
    the major issues inherent in each appropriation bill. Their efforts,
    coupled with those of the Budget Focus Team, addressed seven specific
    goals and identified additional actions, as specified below.
    Goal:
        Evaluate adequacy of CRS coverage of budget issues, identify high
    priority areas and whether client needs are met.
    Accomplishments:
        CRS will continue the practice begun in fiscal year 1996 of
    analyzing the issues arising from each of the 13 appropriations bills
    and preparing an overview of all bills.
        CRS will report on all significant budget developments; budget-
    related products will be regularly updated; and budget products will be
    easily identifiable.
        CRS will continue to develop products covering the four basic
    components of the budget process: the President's budget, the budget
    resolution, appropriations, and reconciliation. Specific products to
    analyze supplementals, rescissions, and continuing resolutions will be
    created as needed for significant bills when it is determined that a
    product is required.
    Work in Progress:
        Starting with the 105th Congress, CRS will enhance coverage and
    analysis of policy issues that are addressed in the budget and
    appropriations process. For example: (1) products covering major non-
    budget policy issues, but with large potential budget implications,
    will contain an analysis of these implications; (2) on a case-by-case
    basis, mentors will be assigned by management to work closely with
    analysts newly assigned to budget-related issues; and (3) all CRS
    products on policies or programs will cover the implications of the
    budget or appropriations whenever these implications figure
    significantly in policy formulation or program change.
    Goal:
        Address the knowledge base of CRS staff on budget issues, determine
    training needs, and design an introductory budget course for CRS staff.
    Evaluate adequacy of resources to support budget-related projects.
    Accomplishments:
        Examined the current level of budget related training and
    recommended three levels of training: beginning, advanced and
    specialized.
        Designed a two-day intensive introductory class on the
    appropriations process. Classes were held for Appropriations Team and
    Budget Team members and other CRS staff in October and November of 1996
    (28 staff members attended). Additional classes will be held in
    January, with priority given to Budget Team and Appropriations Team
    members. The Congressional Reference Division conducted a course on
    budget documents and information sources for members of the
    Appropriations Team.
        Developed the capability within the Library Services Division to
    acquire, organize, and distribute both paper and electronic budget and
    appropriation materials to divisions and analysts.
    Goal:
        Determine the role of CRS in the budget arena vis-a-vis CBO and
    GAO. Assess adequacy of relationships of CRS staff with staff of CBO,
    GAO and OMB and agency budget and program personnel.
    Work in Progress:
        Compared functions of CRS, CBO and GAO in the budget arena. The
    team found uneven but generally good working relationships with GAO and
    CBO. Several activities are under way to improve the relationship and
    exchange of information among CRS, CBO, and GAO, including (1) the
    Associate Director for Research will review methods of gaining easier
    access to CBO and OMB computer runs of budget-related material and ways
    of facilitating access to some other CBO material, including scoring of
    appropriations and other budget bills; and (2) division-level
    management will identify ways to improve communications between CBO and
    CRS.
    Goal:
        Assess adequacy of relationships between CRS staff and staff of
    authorizing, appropriations, and budget committees.
    Accomplishments:
        Appropriations reports listed specific analysts responsible for
    issues covered in the report.
    Work in Progress:
        Continue to develop closer relationships with the staffs of the
    appropriations subcommittees.
    Goal:
        Evaluate the efficiency and effectiveness of the management and
    coordination of budget related projects.
    Work in Progress:
        Recommended that senior management adopt a clear and consistent
    policy involving increased attention to budget products. Coordination
    of ongoing work across division and office lines in CRS would be
    facilitated by a team approach working within the existing
    organizational framework. The team advocated creating an ``Advisory
    Group on the Budget'' to coordinate, advise, and consult with the
    Associate Director for Research on issues related to budget-related
    products and services. For the fiscal year 1998 budget cycle,
    coordinators of the appropriations team will play this role in
    consultation with the Deputy Director.
        The Appropriations Team will continue under the direction of the
    Deputy Director to lead the Service coverage of budget and
    appropriation issues.
                                technology team
        The Technology Team sought to make the most creative and effective
    use of technology in improving CRS services to the Congress and also
    CRS internal work processes. The team addressed three specific goals
    and recommended a number of additional actions.
    Goal:
        Take a snapshot of current electronic infrastructure, including
    hardware, software, internal and external data bases, staffing for
    technical support, and training.
    Accomplishments:
        Interviewed and gathered documentation from CRS offices and
    divisions to provide a comprehensive view of the current electronic
    infrastructure of CRS.
        Constructed charts outlining the baseline technological
    infrastructure of CRS and specifying hardware and software capability
    supporting the major functions and activities of CRS.
        Gathered additional information consisting of inventories of CD-
    ROM's in CRS and of audio-visual equipment and descriptions of
    electronic activities of the Automation Office teams, the Electronic
    Research Products Office, the Bill Digest Section, and the Library
    Services Division.
    Goal:
        Elicit initial staff input on development of a comprehensive and
    integrated legislative information system.
    Accomplishments:
        With the CRS Automation Office, conducted a series of six meetings
    to which all CRS staff were invited. Staff suggestions included 51
    types of data to be considered for inclusion in a Legislative
    Information System (LIS) and 35 suggested functional attributes for the
    system.
        Worked to ensure that suggestions incorporated in the design and
    construction of the LIS, as its development progresses incrementally,
    provides CRS staff with accessible resources for meeting the needs of
    the Congress.
    Goal:
        Examine the current process for determining division and CRS-wide
    technology needs.
    Accomplishments:
        Developed an understanding of current processes for determining
    technology needs and formulated recommendations for improving those
    processes by providing a structure that accommodates change while
    taking into account effects on and needs of users.
        Planning under way to form a CRS-wide technology policy group that
    will consult with technology users, recommend CRS technology
    priorities, disseminate relevant technology information, and review and
    approve implementation plans for new projects. Previously established
    special-focus groups such as the CRS Web Policy Group and the CD-ROM
    Policy Group are to be subgroups of the larger CRS-wide group.
        Modified the CRS staff Home Page to provide information about
    automation training opportunities and user tips such as the ``Database
    News,'' the ``CRD Searcher'' and similar aids.
        Developed a pilot program in the CRS Automation Office for
    improving troubleshooting support throughout CRS.
        Installed Windows 95 as the new operating system for CRS.
        Selected the next generation word-processing program for CRS,
    WordPerfect 7.0, and began efforts to simplify and streamline
    production processes as an integral part of introducing this software.
    An interdivisional team is now doing preliminary testing.
        Helped design professionally moderated focus group sessions with
    congressional staff, conducted by Westat, to explore congressional
    experiences with CRS electronic services. Six focus groups met. The
    average number of congressional staff participating was eight.
    Proposals arising from these sessions are now being considered:
    availability of all CRS products on-line, development of electronic
    ordering capability, enhancement of search features, and creation of a
    less complex, more readily accessible Home Page design. Suggestions
    were also offered for new services for the Home Page.
    Work in Progress:
        The Technology Team is exploring additional actions for achieving
    objectives set for the team.
      --Establish and attain technology competencies throughout CRS,
            appropriate for specific jobs and functions.
      --Enhance technology support by developing the necessary skills for
            the requisite number of staff and determine the extent to which
            technology support staff should be centrally located and
            supervised or be dispersed throughout CRS.
      --Initiate a pilot study to examine the feasibility of establishing a
            CRS-wide approach to purchasing or subscribing to electronic
            resources. Planned implementation includes capabilities such as
            on-line databases, CD-ROM's and specialized software to ensure
            consideration of evolving choices of electronic resources,
            compatibility with existing systems, accommodation of needs for
            paper-based resources, accessibility wherever needed throughout
            CRS, and minimum costs to CRS.
      --Examine alternatives for enhancing electronic production and
            delivery of CRS products and congressional use of electronic
            delivery systems.
                           decreasing resources team
        The Decreasing Resources Team developed a framework for making
    decisions about resource allocations and resource use in an environment
    of constrained budgets in order to continue to place the highest
    priority on the legislative needs of the Congress. Subteams completed
    several tasks, including service-wide consultative management meetings
    to elicit staff perceptions and ideas for improving CRS products and
    services and supporting systems.
    Goal:
        Generate processes, criteria, requirements that must be met when
    any additional resources are sought (personnel and non-personals).
    Accomplishment:
        Developed selected factors or criteria for divisions and offices to
    address in seeking additional personnel and postings. These criteria
    were used to select fiscal year 1996 postings. Criteria included
    ability to move staff or work to meet changing demands, definition of
    the scope of the recruitment effort, diversity and upward mobility
    goals, and overall budget impact. The purpose of the exercise was to
    focus on the implications of hiring decisions, the necessity of linking
    hiring with legislative needs, and alternatives to hiring within a
    division or CRS as a whole.
    Goal:
        Examine the bases used to determine current allocation of non-
    personals.
    Accomplishments:
        Examined the allocation of non-personal resources and recommended
    changes in the process of making allocations to divisions and offices.
    Recommended modifications include a reexamination of built-in costs of
    database and print subscriptions and development of a new, easily
    understandable sub-allotment process at the beginning of each fiscal
    year. Opportunities will be provided for divisions and offices to seek
    changes in allocations throughout the year as needs arise.
        Reviewed CRS database and subscription budgets to determine the
    most efficient ways to utilize these increasingly important resources
    throughout CRS (See Technology Team section).
    Goal:
        Determine guidelines for division and office authority for final
    decision making on already allocated resources.
    Accomplishment:
        Reviewed and endorsed the current system for final decision making
    on the disbursement of allocated resources.
    Goal:
        Elicit staff input to (1) develop a high-priority list of work
    processes for streamlining within each division or office; (2) identify
    five or more products, services or activities, within each division and
    within CRS, for potential elimination, transfer to the Library, or
    restructuring; and (3) create an environment, among managers and staff,
    conducive to moving staff and work within and between divisions and
    offices to improve subject-area coverage and service to Congress.
    Work in Progress:
        In May 1996 began to elicit ideas on opportunities for efficiencies
    within CRS and to identify products, services, or activities that might
    be eliminated, transferred to the Library, or restructured. The Deputy
    Director and the Associate Director for Finance and Administration
    conducted discussions with staff in each division and office to gather
    suggestions throughout the Service.
        Continue to track the many specific and useful suggestions being
    discussed by individual divisions or offices responsible for specific
    programs or services as well as discussions that are part of current
    CRS efforts to anticipate increased staff retirements.
        Encourage consideration by Division Chiefs of a list of
    alternatives to explore shifting staff and work to high priority
    subjects. An independent effort to provide staff details for up to one
    year, based on an agreement with CREA, provided the kind of flexibility
    contemplated by this task.
    Goal:
        Reexamine the need for time accounting.
        No modifications were determined to be immediately necessary, but
    examination of the issue continues.
    Goal:
        Brainstorm options to ensure uniform application of performance
    evaluation standards.
    Work in Progress:
        Continue to examine options that will foster a clearer
    understanding of performance standards and methods and ensure that all
    divisions and offices are applying them consistently. This examination
    continues efforts initiated in 1995 to encourage Division Chief and
    manager participation in promotion reviews outside their divisions or
    offices.
    Goal:
        Identify the impact of ISIS 96 on work processes and make necessary
    adjustments.
    Accomplishment:
        Established a service-wide group of coordinators to ensure that the
    components of the first release of ISIS 96 meets CRS needs. A new team
    has been established to ensure subsequent releases consider service-
    wide and individual division and office needs.
    Goal:
        Complete senior level managerial performance evaluation revisions
    and seek Library adoption.
    Work in Progress:
        The Director submitted to the Library in late December 1995 a set
    of recommendations to Library of Congress regulations governing senior-
    level managerial performance. CRS will continue to work with the
    Library in refining and improving these regulations.
    Goal:
        Distribute to RPC materials on LCR and contract performance
    provisions.
    Accomplishment:
        In March 1996 the Office of Policy Compliance completed and
    distributed to supervisors a CRS Supervisor's Manual providing clear
    guidance on the meaning and application of Library resolutions as well
    as collective contractual bargaining provisions relating to staff
    performance.
                      objectivity and nonpartisanship team
        The Objectivity and Nonpartisanship Team looked at ways to preserve
    and strengthen CRS effectiveness in providing objective support to the
    Congress and ensure inclusion of the broadest possible range of diverse
    viewpoints in the work of the Service. This team anticipates that the
    environment in which the Congress acts will continue to be polarized
    along political and ideological lines. The team's work focused on four
    specific goals.
    Goal:
        Consider and modify (if necessary) guidelines for policy review to
    reflect diverse viewpoints.
    Accomplishments:
        Reviewed and refined CRS procedures, guidelines, and practices
    relating to achieving objectivity and nonpartisanship in CRS products
    and services.
        Compiled a set of current CRS guidelines, LC regulations, and other
    documentation concerning objectivity and nonpartisanship as an aid to
    understanding policy and practices concerning balance and objectivity.
    The compilation was distributed to all CRS staff in December 1996.
    Goal:
        Reexamine CRS disclaimers.
    Accomplishment:
        Reviewed statements on the CRS Home Page and drafted statements
    about CRS nonpartisanship and disclaimers regarding non-CRS resources
    appearing on CRS products and services.
    Goal:
        Review acquisitions and data base resources to ensure diverse
    viewpoints.
    Work in Progress:
        Worked with divisions to review and assess the ideological balance
    of public policy literature including the Public Policy Literature
    File. Resulting recommendations for changes in coverage are being
    implemented.
    Goal:
        Hold consultative management meetings in each division to discuss
    the need to recognize diverse view points and to provide opportunities
    to discuss related problems and issues.
    Work in Progress:
        Began scheduling for staff meetings in each division to provide the
    opportunity to consider objectivity and nonpartisanship issues in the
    context of the new Congress.
                           federal-state shifts team
        The Federal-State Shifts Team addressed increasing congressional
    needs for research and analysis regarding state and local developments
    as the Congress shifts responsibilities for many programs from the
    federal government to the state level. The team developed four specific
    goals and identified additional actions.
    Goal:
        Determine congressional needs for CRS assistance relating to
    program and policy shifts occurring between federal and state
    governments.
    Accomplishments:
        Built on the assumption that the congressional need for CRS
    information and analysis concerning federal-state policy issues will
    continue to grow. Such congressional interests reflect a long-term
    devolution of responsibility and authority and the fact that states are
    and will continue to serve as laboratories for innovations in many
    policy areas.
    Goal:
        Assess the extent to which CRS is currently supporting Congress on
    federal-state policy issues.
    Accomplishments:
        Conducted an internal survey of 78 CRS analysts, librarians, and
    other staff who work on federal-state issues. The survey found that CRS
    currently devotes substantial resources to providing information and
    analysis to Congress on federal-state issues. All divisions have
    responsibility for issues in these areas.
        Collected information from all CRS divisions about the types of
    requests from Congress for information and analysis at the substate
    geographic level and CRS's ability to answer them. This information is
    currently being analyzed.
        Completed a checklist of CRS products on federal-state issues and
    issued the product on November 29, 1996 (96-964 L).
        Began preparation of a new issue brief on federal-state issues that
    may be part of an info pack on the subject.
    Goal:
        Identify problems related to availability, collection, and use of
    information concerning federal-state policy issues.
    Work in Progress:
        Actively seek a replacement source for information issued by the
    now-terminated Advisory Commission on Intergovernmental Relations
    (ACIR), particularly the report ``Significant Features of Fiscal
    Federalism.'' The Rockefeller Institute of Government is planning to
    publish both volume 1 (the survey of state budget and tax laws) and
    volume 2 (the repackaging of Census of Governments data) in May 1997.
    CRS will explore these and other possible alternative sources.
        Work with Library staff to address access to archived government
    electronic resources.
        Develop recommendations on how to respond to decisions by executive
    branch statistical agencies pertaining to the availability and utility
    of information; monitoring changing availability and formats of
    products; improving accessibility of electronic products to CRS staff;
    and preserving present data for the future.
        Monitor a pilot study now under way to assess state materials
    received by the Library's Exchange and Gift Division State Documents
    Unit and to determine the value of this material to CRS and the impact
    its integration would have on CRS.
        Begin to assess the usefulness of commercial on-line systems, such
    as State Track and Legislate's state regulation files.
    Goal:
        Identify CRS staff and resource requirements to support Congress on
    federal-state policy issues.
    Accomplishments:
        Determined that CRS needs to improve interdivisional and staff
    communications, develop better ways to communicate with Congress about
    the work of the Service in this area, and establish better databases
    and models to facilitate manipulation of large data sets on federal-
    state developments.
        Obtained a prototype version of the Catalog of Federal Domestic
    Assistance (CFDA) in an electronic database format from Westat. The
    CFDA electronic database will be integrated into the Education and
    Public Welfare Division's pilot Program Information Explorer (PIE) to
    be tested in early 1997. It will allow analysts to locate statutory and
    administrative information on federal programs and link this to federal
    budget data.
    Work in Progress:
        Create an internal CRS federal-state issues Home Page to serve as a
    vehicle for providing and sharing information within CRS about federal-
    state issues and the availability of materials relating to these
    issues. This Home Page will list new reports by CRS and others that
    focus entirely or in part on the federal-state-local system and
    relationships. After this staff Home Page is operational (expected
    early in 1997) information can be made available to congressional
    offices.
        Monitor a pilot project involving the CRS welfare reform team and
    Lotus Notes, a Groupware application, to facilitate communication and
    the sharing of information resources regarding federal-state issues.
                          congressional turnover team
        This team identified ways to prepare CRS to meet congressional
    needs in an environment increasingly marked by high congressional
    turnover. Much of the team's work is assigned to subteams that have
    been or will be established to complete specific actions or groups of
    actions. Work began in August with a series of focus groups designed to
    elicit information on CRS services and continues with efforts focused
    on programs for the 105th Congress.
    Goal:
        Conduct a focus group review of CRS support for new Members and
    staff.
    Accomplishments:
        The social science research firm, Westat, conducted five focus
    groups with professional staff from 104th Congress new Member offices
    (one focus group with new Senate offices and four with House offices).
    Elicited congressional staff perceptions on what services CRS provides,
    how well CRS meets their needs, how available and objective CRS staff
    are, and whether or not CRS responds appropriately to sensitive
    matters.
        Identified through these focus groups characteristics of CRS that
    are especially valued by Congress: ready response, institutional
    knowledge, coverage on legislative matters, nonpartisan information,
    complement to committees as information source, and a supplement to
    office staff.
        Gathered suggestions to enhance CRS services. The suggestions
    ranged from creation of a legislative hotline to increased outreach,
    better tracking of information requests, and more electronic services.
    Focus group suggestions are being examined more fully by the team and
    by the Director's Office.
    Goal:
        Prepare for the 105th Congress by (a) reviewing and revising
    orientation materials, programs (seminars, open house, etc.), and
    correspondence, (b) planning policy issues coverage including products
    and seminars, (c) organizing new Member seminars, (d) conducting in-
    person outreach (e.g. office visits), (e) supporting congressional
    sponsored programs for new Members, (f) exploring additional support
    targeted at new Members/staff, and (g) developing systematic monitoring
    and data collection of CRS experience with new Members.
    Accomplishments:
                Orientation Materials
        Produced a new 12-minute introductory videotape on CRS, which will
    be distributed to Member offices and will be shown at CRS regular
    weekly briefings on services.
        Redesigned CRS printed orientation materials for the 105th Congress
    to more carefully target and tailor products. A subteam created two new
    brochures, ``Services to Members'' and ``Services to Congress,'' the
    latter designed for staff; two new rolodex cards (one for Members); and
    a wallet size card for Members with key CRS telephone numbers. The team
    also created a portfolio describing CRS services with fact sheets on
    CRS assistance and on each function within congressional offices.
        Sent all Members-elect a letter several days after the election
    describing CRS services; will send a letter to each Member office's
    administrative assistant and legislative director describing CRS
    services and offering in-person briefings on CRS.
                Seminars and Programs
        Received congressional endorsement to provide the official public
    policy orientation for new Members of the House and Senate. This task
    included a one-day policy seminar at the Library for Senators-elect on
    December 5. Five Senators-elect attended. A three-day program for new
    House Members will be held in Williamsburg on January 22-24. Both
    programs received support from the bipartisan leadership of the House
    and Senate.
        Initiated review of current seminars and programs that will be
    provided directly the first few months of the First Session of the
    105th Congress, including the budget seminar series.
                Reports and Other Services
        Issued the CRS Report, ``105th Congress: Key Issues and Early
    Agenda'' (97-1 F), on December 3, 1996.
        Installed a Members-only telephone line to facilitate access to CRS
    analysts and services.
        Created a Guide to the Legislative Process on the CRS Home Page.
                Evaluating Programs
        Review CRS efforts to prepare for the 105th Congress and develop
    management systems to collect and evaluate relevant information and
    report findings.
    Goal:
        Evaluate committee liaison effort and recommend options for the
    future.
    Work in Progress:
        Create a subteam to address how CRS can best ensure effective, on-
    going liaison with the committees of the 105th Congress.
                     appendix--strategic goals team members
                               budget focus team

                       Donald Kiefer (ECON), Team Leader

    Michael Anderson (CRD)
    Patricia Ayers (CRD)
    John Blodgett (ENR)
    Stephen Daggett (FAND)
    Michael Davey (SPR)
    John Fischer (ECON)
    Sharon Gressle (GOV)
    Paul Irwin (EPW)
    Jean Jones (ENR)
    Nancy Jones (ALD)
    Robert Kirk (LSD)
    Janet Kline (EPW)
    Martin Lee (ENR)
    Paul Rothberg (SPR)
    Mallary Stouffer (RSH/ERPO)
    Patricia Wertman (ECON)
    Philip Winters (ECON)
                          appropriations coordinators

                         Angela Evans (DO), Team Leader

    Michael Anderson (CRD)
    Carl Behrens (ENR)
    Suzanne Cavanagh (GOV)
    Ralph Chite (ENR)
    Stephen Daggett (FAND)
    Michael Davey (SPR)
    Paul Dwyer (GOV)
    John Fischer (ECON)
    Alfred R. Greenwood (ENR)
    Marc Humphries (ENR)
    Paul Irwin (EPW)
    Nancy Jones (ALD)
    Janet Kline (EPW)
    Robert Kirk (LSD)
    Edward Knight (ECON)
    Sylvia Morrison (ECON)
    Nonna Noto (ECON)
    Larry Nowels (FAND)
    Barbara Schwemle (GOV)
    George Siehl (FAND)
    Sandy Streeter (GOV)
    Susan Vanhorenbeck (ECON)
    Philip Winters (ECON)
                                technology team

                   Jane Bortnick Griffith (SPR), Team Leader

    Richard Ehlke (ALD)
    Susan Finsen (FIN)
    Peggy Garvin (CRD)
    Jeffrey Griffith (RSH)
    Steven Hildreth (FAND)
    James Jackson (ECON)
    Michael Koempel (GOV)
    John Moore (ENR)
    Richard Rimkunas (EPW)
    Stephanie Williams (LSD)
                           decreasing resources team

                      Richard Ehlke (ALD), Co-Team Leader

                     Michael Koempel (GOV), Co-Team Leader

    Time Accounting
      Roger White (ECON)

    Consultative Management Meetings
      Angela Evans (DO)
      Susan Finsen (FIN)
      Lynne McCay (CRD)
      Donna Scheeder (CRD)

    Performance Standards
      Charlotte Preece (FAND)
      Jay Hadlock (CRD)
      Donald Kiefer (ECON)
      Bessie Alkisswani (FIN)
      James Richardson (LSD)
      Jean Jones (ENR)
      Clay Wellborn (GOV)
      Sharon House (EPW)
      Lennard Kruger (SPR)
      Karen Lewis (ALD)
      Douglas Warshof (POL)
    LCR and Contract Performance
      Douglas Warshof (POL)
      Hugh Elsbree (POL)
      Marie Anderson (FIN)
      Joseph Broderick (POL)
      Gloria Hines (FIN)

    Nonpersonals
      Research Policy Council

    Personnel Resources
      Research Policy Council

    Senior Level Managerial Performance
      Hugh Elsbree (POL)
      James Richardson (LSD)
      Douglas Warshof (POL)

                      objectivity and nonpartisanship team

                         John Moore (ENR), Team Leader

    Pat Ayers (CRD)
    Bill Cox (ECON)
    Mark Eddy (GOV)
    Hugh Elsbree (POL)
    James Robinson (POL)
    Irene Stith-Coleman (SPR)
    Kris Vajs (LSD)
                           federal-state shifts team

                       P. Royal Shipp (EPW), Team Leader

    Keith Bea (GOV)
    Eugene Boyd (GOV)
    Thomas Carr (ALD)
    Claudia Copeland (ENR)
    Kathleen Doddridge (CRD)
    Thomas Gabe (EPW)
    Peggy Garvin (CRD)
    Robert Goldich (FAND)
    David Huckabee (GOV)
    Gerald Mayer (ECON)
    Nonna Noto (ECON)
    James Riehl (CRD)
    Tangela Roe (LSD)
    Alix Salinas (LSD)
    Wendy Schacht (SPR)
    Margot Schenet (EPW)
    Clay Wellborn (GOV)
    Jennifer Williams (GOV)
                          congressional turnover team

                       Janet Kline (EPW), Co-Team Leader

                    Charlotte Preece (FAND), Co-Team Leader

                               Orientation Video

    Robert Bamberger (ENR)
    John Blodgett (ENR)
    Linda Cox (RSH/SB)
    Gary Levine (RSH/AV)
    Robert Nickel (RSH/AV)

                             Orientation Materials

    John Blodgett (ENR)
    Robert Newlen (RSH/IQ)
    Karen Wirt (RSH)

                                  Senate Fair

    Mildred Amer (GOV)
    Keith Bea (GOV)
    Chandell Butler (DO)
    Vanessa Cieslak (CRD)
    Michael Davey (SPR)
    Susan David (RSH/AU)
    Mark Eddy (GOV)
    Carl Ek (FAND)
    Kelly Garcia (RSH/SB)
    Kevin Greeley (ALD)
    Amy Johnson (DO)
    Frederick Kaiser (GOV)
    Robert Keith (GOV)
    John Kelley (RSH/AU)
    Lynne Kennedy (CRD)
    Fran Larkins (CRD)
    Jennifer Manning (CRD)
    Clyde Mark (FAND)
    Lynne McCay (CRD)
    Robert Newlen (RSH/IQ)
    JoAnne O'Bryant (GOV)
    Dylan Perkins (RSH/IQ)
    Jill Roberts (RSH/SB)
    Barbara Salazar (CRD)
    Karen Spar (EPW)
    Rita Tehan (CRD)
    Lorraine Tong (GOV)

                                  105th Report

    Karen Alderson (LSD)
    Jean Bowers (LSD)
    Ted Burch (LSD)
    Felix Chin (LSD)
    Lisa Dove (LSD)
    Kerry Dumbaugh (FAND)
    Susan Fletcher (ENR)
    Sharon Gressle (GOV)
    Robert Howe (LSD)
    Paul Irwin (EPW)
    Nancy Jones (ALD)
    Robert Kirk (LSD)
    Lennard Kruger (SPR)
    Valentin Leskovsek (LSD)
    Terrence Lisbeth (FAND)
    Bonnie Mangan (LSD)
    Tangela Roe (LSD)
    Alix Salinas (LSD)
    Margot Schenet (EPW)
    Sherry Shapiro (LSD)
    Edith Sutterlin (LSD)
    Jack Taylor (ECON)
    George Walser (LSD)
    Karen Wirt (RSH)
    Amy Woolf (FAND)

                         Management Information System

    Robert Bury (RSH/AU)
    Janine D'Addario (DO)
    Edward Ecklund (RSH/AU)
    Richard Huang (RSH/AU)
    Ernestine Wang (RSH/AU)
    Brenda Wesner (RSH/ISIS)

                                      PPI

    Claudia Copeland (ENR)
    Michael Davey (SPR)

                                    Letters

    Chandell Butler (DO)
    Janine D'Addario (DO)
    Amy Johnson (DO)
    Michael Koempel (GOV)
    Rosslyn Richardson (DO)

                              Westat Focus Groups

    Walter Albano (LSD)
    Bette Alberts (RSH/SB)
    Marie Anderson (FIN)
    Jane Bortnick Griffith (SPR)
    Lizanne Dinoto (RSH/IQ)
    Pamela Dragovich (CRD)
    Mary Geraghty (RSH/IQ)
    Penny Heavner (FIN)
    Evelyn Howard (RSH/SB)
    Lynne Kennedy (CRD)
    Janet Kline (EPW)
    DeMarie Lawrence (RSH/ERPO)
    Patricia Raap (SPR)
    Jill Roberts (RSH/SB)
    Kent Ronhovde (RSH)
    Mary Smith (EPW)
    Karen Wirt (RSH)

                              New Member Seminars

    Vee Burke (EPW)
    Joseph Cantor (GOV)
    William Cooper (ECON)
    Claudia Copeland (ENR)
    Linda Cox (RSH/SB)
    William Cox (ECON)
    Janine D'Addario (DO)
    Stephen Daggett (FAND)
    Susan David (RSH/AU)
    Charles Doyle (ALD)
    Susan Finsen (FIN)
    Paul Gallis (FAND)
    Kelly Garcia (RSH/SB)
    Peggy Garvin (CRD)
    Jane Gravelle (ECON)
    Penny Heavner (FIN)
    George Holliday (ECON)
    Nancy Jones (ALD)
    Robert Keith (GOV)
    John Kelley (RSH/AU)
    Donald Kiefer (ECON)
    Janet Kline (EPW)
    Michael Koempel (GOV)
    David Koitz (EPW)
    Lynne McCay (CRD)
    Jennifer Manning (CRD)
    John Moore (ENR)
    Raphael Perl (FAND)
    Charlotte Preece (FAND)
    Richard Price (EPW)
    Jill Roberts (RSH/SB)
    Paul Rundquist (GOV)
    Denis Steven Rutkus (GOV)
    Wendy Schacht (SPR)
    Judith Schneider (GOV)
    P. Royal Shipp (EPW)
    Stanley Sloan (FAND)
    James Stedman (EPW)
    Robert Sutter (FAND)
    David Teasley (GOV)
    Joyce Vialet (EPW)
    Ruth Wasem (EPW)
    Stephanie Williams (LSD)
                                     ______

                                     The Librarian of Congress,
                                         Washington, DC, July 23, 1997.
    The Honorable Robert F. Bennett,
    Chairman, Subcommittee on the Legislative Branch, Committee on
            Appropriations, United States Senate, S-125, The Capitol,
            Washington, DC.
        Dear Senator Bennett: On behalf of all the Library's staff, I want
    to thank you for your leadership and support of the Library in the
    Senate Legislative Branch bill. By a wonderful coincidence, the news of
    the Senate levels arrived at the Library just as we began a briefing
    for all of the Library's managers and supervisors about the Library's
    updated five-year strategic plan.
        I enclose a copy of the plan for your perusal. It sets out both
    clear goals and challenges for all of us at the Library. Our principal
    challenge is to sustain past gains while becoming a more efficient and
    effective operation. The Senate appropriations bill for the Library
    recognizes the importance of the Library's workforce, supports critical
    areas of technological innovation, and provides additional needed
    support for security of the Library's collections, data, and workforce.
        We are grateful for both your personal support and your leadership
    on the Committee on behalf of the Library and the entire Legislative
    Branch.
                Sincerely,
                                           James H. Billington,
                                             The Librarian of Congress.

                 Library of Congress Strategic Plan (1997-2004)

                     letter from the librarian of congress
        With Congressional support and direction, the Library of Congress
    has developed over 196 years a massive collection of more than 111
    million items, cost-effective institutional networks, and a superbly
    knowledgeable staff. It directly serves not only the Congress, but the
    entire nation with the most important commodity of our time--
    information.
        At a time when our collective economic productivity is increasingly
    based on information and our creative use of individual freedom
    requires more lifelong learning, the Library of Congress has become
    increasingly important to the country as a unique resource. Because of
    its past stewardship and thanks to current technology, the Library can
    be tapped not only by the Congress and people in the Washington
    metropolitan area but by schools, libraries, and the private sector
    everywhere.
        Our National Digital Library effort--providing remote electronic
    access to the multimedia Americana collections here and in other great
    repositories--has already begun to revolutionize local public access to
    information and to spur increased interest in learning. Access to this
    great information bank is expected to stimulate and inspire young and
    old, and to increase the interest in and demand for libraries, books,
    and reading.
        The future of all the Library's efforts depends on solid gains in
    the Library's core activities: serving the Congress efficiently;
    acquiring, organizing, protecting, and preserving a universal
    collection; reducing arrearages on schedule; and making the Library's
    newly renovated facilities increasingly useful and hospitable to the
    Congress, scholars, and researchers.
        Our staff has made great gains under the 1993-2000 strategic plan:
    the National Digital Library effort is ahead of schedule; our
    arrearages have been significantly reduced; the Library's historic
    Jefferson Building is re-opening in April; the secondary storage plan
    and the book preservation efforts have borne fruit; the financial
    system is being modernized; collections security has vastly improved;
    and technological progress is well beyond what we imagined when we
    created the 1993-2000 plan. We fell short in some areas, particularly
    those related to performance accountability and infrastructure support,
    and must act decisively to address these issues; we remain accountable
    to the Congress and the people.
        As we adjust our strategic plan, we seek to strengthen and preserve
    our primary asset, a diverse workforce--renewing it with fresh talent
    that is both developed within the Library and recruited from outside.
    We will work smarter with staff who are well trained, motivated, and
    strongly supported in carrying out the Library's mission in the
    Information Age. We will embrace change--stressing quality,
    productivity, and tangible results in all phases of our work.
        I am confident that we can and will do what is necessary.

                                           James H. Billington,
                                             The Librarian of Congress.
                                  introduction
        The opportunities for the Library of Congress to make major
    contributions to the Congress and the nation are greater now than ever:
    to provide services to the Congress as it faces increasingly complex
    issues; to continue to acquire, organize, preserve, secure and sustain
    our collections; to make our collections more accessible, both online
    and off, to the country's schools, libraries, and the private sector;
    and to make our renovated facilities a true center of scholarly
    productivity and creativity.
        In coordination with the Congress, we have re-examined our
    management operations to improve our services and to identify
    priorities critical to our future success. Out of these efforts, we
    must strengthen accountability. To realize that end we have designed a
    Management Improvement Plan with specific tasks, timetables, and goals.
    We will continue to evaluate our operations and our services
    critically.
        We believe that the Library's greatest strength is the knowledge
    and expertise of its workforce, which, despite job losses, has
    preserved a widespread devotion to excellence and to the service of the
    Congress and the nation. In the end, the talents and dedication of a
    diverse Library staff will enable the Library to achieve and sustain
    its leadership role in the 21st century.
        Another great strength of the Library is its standing, not only as
    the world's greatest repository of recorded knowledge, but also more
    recently as a leader in the new age of digital information, through our
    National Digital Library Program.
        The Library's challenge, under the 1997-2004 strategic plan, is to
    sustain past gains while becoming a more efficient and effective
    operation. We will do this by using mission and strategic priorities to
    identify funding and resource requirements. We will also identify
    specific objectives and action items to use as performance measures.
        Our strategic plan maps the changes that will ensure that the
    Library--the research and information arm of the national legislature
    and the world's foremost storehouse of knowledge--continues its worthy
    tradition of collecting, preserving, sharing, and fostering creativity
    and learning in support of the Congress, the public and the democratic
    ideal. In so doing, the Library of Congress, in cooperation with other
    strong institutions, will strive to spark a renaissance in learning.
                          vision for the 21st century
        The Library leads the nation in ensuring access to knowledge and
    information and in promoting its creative use for the Congress and its
    constituents.
                                     values
                  the eight values of the library of congress
        Service.--Best possible service to our constituents.
        Quality.--Highest quality in every aspect of our activities.
        Effectiveness.--Resources applied in direct support of our mission.
        Innovation.--New and creative methods to improve our services.
        Fairness.--Fairness and respect in our treatment of all staff and
    users.
        Participation.--Widespread staff involvement in planning,
    implementing, and improving our activities.
        Communication.--Clear and consistent communication with staff and
    constituents.
        Excellence.--Encouragement and support of staff excellence.
                                    mission
        The Library's mission is to make its resources available and useful
    to the Congress and the American people and to sustain and preserve a
    universal collection of knowledge and creativity for future
    generations.
                                   priorities
        The first priority of the Library of Congress is to make knowledge
    and creativity available to the United States Congress.
        The Congress is the lawmaking body of the United States. As the
    repository of a universal collection of human knowledge and the
    creative work of the American people, the Library has the primary
    mission to make this material available and to identify, analyze and
    synthesize the information it contains to make it useful to the
    lawmakers who are the elected representatives of the American people.
        The second priority of the Library of Congress is to acquire,
    organize, preserve, secure and sustain for the present and future use
    of the Congress and the nation:
      --A comprehensive record of American history and creativity. The
            record of American history and creativity has to be maintained
            in order both to protect intellectual property rights (a
            constitutional mandate statutorily exercised by the Copyright
            Office) and to preserve the record of the past for the sake of
            future creativity (the constitutional mandate ``to promote the
            Progress of Science and useful Arts'').
      --A universal collection of human knowledge.\1\ A collection that
            includes all languages and formats is essential to meet the
            present and potential needs of the Congress (the statutory work
            of the Congressional Research Service) and of the government
            more broadly (Law Library, Federal Research Division, general
            reference services).
    ---------------------------------------------------------------------------
        \1\ Except for technical agriculture and clinical medicine, which
    are covered by the National Agricultural Library and the National
    Library of Medicine respectively.
    ---------------------------------------------------------------------------
          All other services and activities of the Library of Congress
            support the core mission of maintaining and continuing to build
            on the world's greatest treasury of recorded human knowledge.
        The collections must continue to be comprehensive in order to keep
    pace with the rapid proliferation of information. The Library of
    Congress is the only library in the world that collects universally. If
    this time-honored tradition were diminished, the present functioning
    and future creativity of both the Federal government and the American
    free enterprise system would suffer.
        The third priority of the Library of Congress is to make its
    collections maximally accessible to (in order of priority): the
    Congress; the U.S. government more broadly; and the public.
        It is unprecedented in human history--yet uniquely American--to
    offer open public access to an institution that at the same time serves
    in many ways as the working library of a government and a de facto
    national library.
        The unifying purpose of providing the public with essential library
    services, such as cataloging and reference help, is to extend as much
    access to useful information as possible to each of these three
    constituencies. The National Digital Library is dramatically broadening
    public access by making the most interesting and important documents of
    American history and culture remotely available electronically for
    local schools, libraries, businesses, and homes across America.
        The unique and ambitious mandate that the Congress has given its
    Library during the past two centuries is a stunningly original
    expression of a broader American democratic ideal. For a democracy to
    be dynamic and self-correcting, its governing institutions must be not
    only continuously accountable to the people but also solidly based on a
    body of knowledge that is both constantly expanding and available
    equally to those who legislate and to those who elect the legislators.
        Equal access to knowledge for both governors and governed, rich and
    poor, represents an essential minimal form of empowerment in a
    pluralistic democracy, and has found expression in our system of public
    libraries and public schools. The Congress has assigned to the Library
    a series of centralized national functions that are essential to the
    health of these local institutions: setting bibliographic standards,
    providing subsidized cataloging, storing the records and artifacts of
    the copyrighted creativity of America, and creating and delivering
    nationwide free reading materials for blind and physically handicapped
    persons.
        The Congress has now recognized that, in an age in which
    information is increasingly communicated and stored in electronic form,
    the Library should provide remote access electronically to key
    materials. For the general public, the Congress has endorsed the
    creation of a National Digital Library Program through a private-public
    partnership that will create high-quality content in electronic form
    and thereby provide remote access to the most interesting and
    educationally valuable core of the Library's Americana collections.
    Schools, libraries, businesses, and homes will have access to important
    historical material in their own localities--together with the same
    freedom readers have always had within public reading rooms to
    interpret, rearrange, and use the material for their own individual
    needs.
        The fourth priority is to add interpretive and educational value to
    the basic resources of the Library in order to enhance the quality of
    the creative work and intellectual activity derived from these
    resources, and to highlight the importance of the Library's
    contributions to the nation's well-being and future progress.
        Implicit in the broad and international inclusiveness of the
    Library's clientele (both here and elsewhere) is another ideal of
    American democracy: the desire to promote the free exchange of ideas.
        There are three essential aspects to this priority that are
    uniquely available through the Library of Congress: greater use by the
    Congress, government officials, and the private sector of the vast
    special (i.e., non-book) and foreign language collections that are
    often unique to the Library and that have generally been underused
    resources; greater use of the Library's Capitol Hill facilities by
    scholars for the kind of interdisciplinary, cross-cultural,
    multimedial, multilingual, and synthetic writing that is important to
    Congressional deliberation and national policy-making, but inadequately
    encouraged by either academic specialists, special interest groups, or
    advocacy-oriented think tanks; and greater use by the general public
    through programs that stimulate interest, increase knowledge, and
    encourage more citizens to use the collections in more varied ways both
    on-site and electronically.
        The Library staff will increase its role as knowledge navigators by
    helping more people find appropriate materials in a swelling sea of
    unsorted information and pointing them to services and resources unique
    to the Library of Congress. This requires not merely more development
    and retraining of staff than the Library has previously been able to
    do, but also facilitating in new ways more extensive and systematic use
    by researchers of the distinctive materials that only the Library of
    Congress has. Programs for the general public, such as exhibits or
    publications, must demonstrate the value and usefulness of the
    collections.
    Enabling infrastructure
        To accomplish its mission and support the Library's four
    priorities, the Library must have an efficient and effective
    infrastructure with five key components:
      --The mobilization and motivation of human resources in all parts and
            at all levels of the Library.
          There are four important elements within this category:
            recruiting, assessing, rewarding and holding accountable
            employees on the basis of objective evaluations of knowledge,
            skills and performance; training, developing and, where needed,
            retooling the workforce to perform new functions in new ways;
            promoting fairness, equal opportunity, and respect for
            diversity at all levels and in all parts of the Library; and
            fostering communication by using early and frequent
            consultation to promote innovation and increase participation
            in decision-making and in implementing change.
      --The provision and delivery of electronic services in order to serve
            the departments of the Library in the execution of the
            Library's mission and priorities with speed, quality, and
            economy.
      --The allocation and use of space and equipment in order: to preserve
            and make accessible the artifactual collections; and to
            maximize the efficiency, productivity and wellbeing of the
            staff.
      --The operation of modern financial and information systems to
            facilitate decisionmaking and ensure accountability.
      --The operation of effective security systems that ensure adequate
            access and at the same time provide maximum protection for the
            staff and patrons, facilities, data, and collections.
                             operating assumptions
        Congressional Support.--Library of Congress managers will work with
    the Congress to secure appropriate financial and legislative support.
        Library Management.--Library Management will make timely decisions
    consistent with and in support of the Library's mission and priorities.
        The Library's Infrastructure.--The Library's infrastructure will be
    strong, responsive and activist. Human resources support will be
    provided in a timely and efficient manner; current technology and
    technology training support will be available on a timely basis;
    technology forecasting will be fully integrated into the Library's
    planning; space planning and the execution of plans will be
    streamlined; financial information will be readily available to all who
    need it; and improved security systems will be in place.
        Library Leadership.--Relying on its incomparable collections, the
    Library will continue taking a leading role in facilitating the
    information revolution, creativity, and research--ensuring that 21st
    century Americans will have a well developed, sophisticated and
    increasingly global supply of information.
        Copyright Office.--The Copyright Office, a major source of Library
    of Congress collections, will remain an integral part of the Library,
    and it will begin providing copyright deposits in digital form for LC's
    selection and collections.
        Emerging Technologies.--The Library of Congress will keep pace with
    the new technologies to enable it to remain a leader in the field of
    librarianship and the delivery of information and to ensure that its
    collections are developed qualitatively in support of its mission.
        Public-Private Partnerships.--The Library will rely on support from
    a broad range of public-private partnerships and coalitions, both
    nationally and internationally, to build and maintain the National
    Digital Library Program and other Library programs. The transition to a
    national digital library requires the Library to launch an enormous
    cooperative effort with the American library community and to establish
    a global digital library coalition to which many libraries and other
    institutions contribute. The Library will establish policies that
    encourage such partnerships.
        Fundraising.--The Library will continue to seek public-private
    funding to support its outreach programs.
        Quantity of information.--Far more information will be generated in
    more ways, more places, and more formats than in the past.
        Congressional needs.--The knowledge/informational needs of the
    Congress and the government will be more complex and extensive than
    ever before.
                           strategic plan objectives
        Priority I.--To make knowledge and creativity available to the
    United States Congress.
    Strategic Plan Objectives:
        To fulfill all Congressional mandates so well that the Congress
    confidently continues to rely upon the Library to meet those needs;
        To meet or exceed needs and expectations of the Congress for
    legislative research, analysis and information services at a level of
    sustained excellence; and
        To assure that the Congress is fully cognizant of the services and
    resources of the Library of Congress, and has ready and reliable access
    to them.
        Priority II.--To acquire, organize, preserve, secure, and sustain
    for the present and future use of the Congress and the Nation a
    comprehensive record of American history and creativity and a universal
    collection of human knowledge.
    Strategic Plan Objectives:
        To develop and maintain the Library's universal collections in all
    formats and languages, acquiring them through copyright, gift,
    exchange, purchase, and transfer, in the most timely and cost-effective
    manner to support the Library's mission;
        To ensure that the Library's collections, both physical and
    electronic, are appropriately secure;
        To achieve arrearage reduction goals;
        To provide innovative and effective bibliographic, intellectual,
    and physical control that is appropriate, timely, and of high quality
    for all of the Library's collections;
        To ensure the preservation of the Library's collections for current
    and future use, using appropriate preservation treatment and
    technologies;
        To lead the development, maintenance, and dissemination (both
    nationally and internationally) of standards needed for: effective
    electronic interchange of documents and bibliographic data;
    preservation; and the theory and practice of cataloging; and
        To organize, sustain and make more usable the record of American
    creativity through copyright registration, deposit, and recordation
    systems.
        Priority III.--To make the Library's collections maximally
    accessible to the Congress, the U.S. government more broadly, and the
    public.
    Strategic Plan Objectives:
        To lead in the area of electronic outreach by contributing to a
    national digital library that provides both broad access to the
    Library's collections and links to other significant, publicly
    available information, regardless of its location and format;
        To make the Library's collections available both nationally and
    internationally through use of digital technology, lending, and
    document delivery;
        To provide high-quality service to users accessing the Library by
    telephone, correspondence, and electronic means;
        To sustain high-quality service to users of the Library's reading
    rooms, research areas, and collections;
        To broaden awareness and use of the Library's special and foreign-
    language collections and reading rooms;
        To sustain and improve high-quality service to blind and physically
    handicapped patrons; and
        To develop a plan to continue the National Digital Library Program
    beyond the year 2000.
        Priority IV.--To add interpretive and educational value to the
    basic resources of the Library in order to enhance the quality of the
    creative work and intellectual activity derived from these resources,
    and to highlight the importance of the Library to the nation's well-
    being and future progress.
    Strategic Plan Objectives:
        To foster creative scholarship in the Library's unique collections
    including foreign-language and special-format materials;
        To promote awareness of the Library and fuller and more varied use
    of its resources through national and international copyright services,
    exhibits, concerts, publications, associations, conferences, colloquia,
    and other interpretive programs.
        Enabling infrastructure.--To accomplish its mission the Library
    must have an efficient and effective infrastructure.
    Strategic Plan Objectives:
                Financial Services
        To provide financial services (budget, accounting, disbursal and
    travel) to its clients and to conduct program activities, allocate
    resources, and ensure accountability; and
        To improve the Library's financial and legal framework, policies
    and procedures.
                Human Resources
        To provide human resources leadership in service to the Library's
    internal constituency;
        To formulate and put in place a comprehensive personnel program
    that will significantly improve timeliness, efficiency and
    responsiveness to client needs; and
        To promote equal employment opportunity at the Library of Congress
    and facilitate resolutions of disputes fairly and quickly.
                Security
        To ensure the security of Library staff, visitors, facilities,
    collections, and other assets.
                Support Services
        To promote occupational health and safety and to provide a healthy,
    safe environment for staff and visitors;
        To provide facility management, space, and interior design support;
        To provide procurement and logistic support; and
        To provide records management, mail distribution, printing, and
    transportation services.
                Technology
        To align the Library's current information technology resources
    with its overall priorities and develop technological architecture that
    will support the Library's objectives;
        To improve information technology customer satisfaction; and
        To establish and enforce information technology standards that will
    ensure compatibility of information technology systems.
                    the library of congress in the year 2004
        We designed our strategic priorities and objectives (1997-2004) to
    lead the Library into the 21st century and to promote cooperation with
    and support for our constituencies. When we accomplish our objectives,
    the Library, because of its staff and vast and comprehensive
    collections, will be a major component of a worldwide information
    network. Modern storage and retrieval systems will be in place, and our
    integrated information system will support sustained, high-quality
    service to the Congress, visitors, readers, the Copyright Office, and
    the core functions and services of the Library. Our efficiency and
    communication will be greatly improved; our staff, visitors,
    collections, and facilities will be protected; and we will serve as a
    security model for the nation's libraries.
        Focused training, education, advancement, and redeployment of our
    diverse staff and aggressive recruitment of high-quality talent will
    enable us to fill the gap left by retirements. The resulting well-
    motivated and gifted staff will harness the latest technology to
    provide service in the most creative and efficient way.
        The promise of the magnificently restored Thomas Jefferson Building
    will be fulfilled; and the Jefferson Building will be the site of
    distinguished exhibitions, seminars, educational conferences, and
    altogether new forms of scholarly communication. Scholars, researchers,
    and students will, more than ever before in the Library's 200-year
    existence, be able to mine the Library's unique collections and to make
    connections across barriers of language, medium, and discipline that
    will make the Library the most vibrant center of intellectual activity
    in the world.
        The electronic outreach the Library will be making in every
    Congressional district will significantly contribute to educational
    renewal and to a fresh, mature appreciation of the richness and
    diversity of our common American heritages. The model of the National
    Digital Library will have helped stimulate a number of other national
    public-private undertakings that will take advantage of much more of
    the Library's immense basic resources as well as of the special skills
    of CRS, the Law Library and the Copyright Office to increase the
    creativity, productivity, and international competitiveness of the
    United States.
                                 moving forward
        Using the Government Performance and Results Act (GPRA) as a guide,
    the Library organized the strategic planning process into two parts.
    Part one identified the mission, priorities, values, and expectations
    to take us into the 21st century. Each service unit and support area
    identified its role in accomplishing the mission, priorities, and
    objectives. From these individual plans, the Library produced a single
    unified strategic plan that will drive the planning, programming, and
    budget process into the future.
        In part two of the planning process, each service unit and support
    area will develop specific action items to accomplish agreed-upon
    priorities and objectives. Each action item will be assigned to a
    service unit(s) or individual(s) and be subject to periodic review. The
    items will also be used in developing performance plans.
        In November 1996, the Library created a Planning, Management, and
    Evaluation Directorate (PMED) to monitor the plan's implementation.
    PMED and the Financial Services Directorate (FSD) will work jointly
    with the Deputy Librarian to synchronize and monitor the planning,
    programming, and budgeting process.
        Following the completion of part two, the staff will create the
    Library's Five-Year Resource Program, which will translate the plan
    into affordable programs. The first year of the Five-Year Resource
    Program will become the basis for subsequent budget requests.

                       opening statement of general scott

        Senator Bennett. General Scott, we welcome you.
        General Scott. Thank you, Mr. Chairman and members of the
    committee. I thank you for this opportunity to appear with Dr.
    Billington to present the Library's 1998 budget.
        Last September, Dr. Billington appointed me as the Deputy
    Librarian responsible for the day-to-day operations of the
    Library of Congress, which is a great national institution. In
    my 7 months at the Library, I have found that all of the staff
    have a strong will to succeed and that they are receptive to
    new ideas.

                            Facilitative leadership

        In that time, I introduced a 3-day workshop, called
    Facilitative Leadership. All of the 557 managers and
    supervisors have to date completed the workshop. What they
    learned from the training was a better understanding of how to
    get more people involved in the decisionmaking process, pushing
    down accountability and responsibility.
        This has been an exciting 7 months for me and we do face
    many challenges. Some of the challenges I speak of I will
    highlight in my statement.

                          Management improvement plan

        We have developed a plan that encompasses the findings of
    the GAO and the other audit agencies over the past few years.
    This improvement plan has specific goals and timetables for
    individual managers to improve performance in areas critical to
    library operation--in collection security, in financial
    management, in human resources, and in other key areas. We are
    making progress in fiscal year 1997.
        With your support, we can make even greater progress in
    fiscal year 1998 and beyond.
        These current management improvement efforts are all part
    of our long-range strategic plan which also calls for new
    automation systems across the Library to allow us to work
    smarter and faster with fewer resources.
        This is why in our 1998 budget request we have asked you to
    make a 5-year commitment to an integrated automated system for
    basic operations within the Library. Nearly every other major
    American research library, including Brigham Young University,
    has converted to modern, commercially available, integrated
    systems.
        Within this past year, these new commercial systems have
    shown that they are now capable of handling a library the size
    of the Library of Congress.

                            Automated system charts

        I have four charts that I would like to use to show you
    what we have done as far as our automated system goes, how it
    is outmoded, what we desire, and then the costs spread over the
    next 4 years. You do have these charts in your packet, but I
    can hold them up and speak to the issues.
        Currently, we have a system that resembles more of a
    smokestack function than it does an integrated function. That
    means that we do all of the Library's functions a function at a
    time.
        We have 2,000 employees who must rely on this inadequate
    system at a tremendous cost of time, duplication of effort, and
    the upkeep of outmoded technology.
        As you see on your left, we have actually five large,
    separate systems and many smaller systems that support the
    Library's manual functions. Now again, these do not share data.
    We do some of the inventory and some of the data by hand, which
    makes it slow and cumbersome, and we have a lot of paper that
    we have to file and store.

                             new Integrated system

        All of this impairs not only our operations but it also
    impairs collection security. So we want to replace the old
    systems with a single, integrated system to support all of the
    functions, such as acquisition, such as collection,
    circulation, and certainly security and related activities.
        So the new integrated system that we are asking for will
    allow for centralizing control and security while streamlining
    the workflow and helping to reduce and eliminate maintenance
    costs.
        As an example of how the current system is slow and time
    consuming, you can see on your left [indicating] that if you
    were to request a book and the item was not where it was
    supposed to be, it could take up to 20 steps to locate that
    item. Under the new system, that could be reduced to four
    steps. Thus, as you can see, it would be a tremendous boon to
    inventory and knowing where the collections are.

                           cost for Integrated system

        This chart shows that we are asking you for $5.6 million in
    1998 and another $9 million that would be spread over 5 years
    to complete this project. Now all of these costs will include
    the hardware, the software, the training, and the data
    conversion that is necessary to do this. The new system will
    enable us to redirect some labor to other critical areas--
    circulation, arrearage, backlog, and you can see that we would
    not expect to have that redirecting group of staff until about
    the year 2000.
        Putting this in would help us to meet the increased demands
    on the Library's operations.
        In addition to the automation, we also are asking that our
    near-term goals and requirements be considered by you. We
    depend on your funding $14.7 million in mandatory wage and
    price increases, which is the largest single item in our
    budget.

                            reduction in Work force

        We are keenly aware of the competition for resources and
    that Congress has given the Library very considerable
    treatment. Despite the committee's best efforts, however, we
    know we now have little flexibility left to absorb such costs.
    During the last 5 years, we have had a net reduction in our
    work force of 435 FTE's, many of them highly skilled
    professionals. Without congressional funding for these
    mandatories, we would be forced to cut another 178 positions.
    That could mean a tangible erosion in services, services that
    no other institution provides.

                             Talking book machines

        It is also important that we ask you to give consideration
    to our request for $2.5 million to acquire 10,000 additional
    talking book machines. These machines will allow the Library
    services for 750,000 blind and physically handicapped Americans
    in every State to continue without interruption.
        Again, we need your continuing investment in the future of
    the Library, in our people, and in our technology. That would
    enable us to do more than serve the Congress and the Nation
    with fewer staff.
        Thank you for this opportunity. Dr. Billington and I are
    now available for your questions.

                       questions on ILS investment chart

        Senator Bennett. Thank you very much.
        Can we go back to your fourth chart there?
        General Scott. Yes, sir.
        Senator Bennett. As I understand it, the red bars are the
    investment in the present system and they come down by the year
    2004 to virtually nothing.
        General Scott. The red bar is the investment for the new
    system, what we estimate the new system would cost. It's for us
    to put in the new system.
        Senator Bennett. OK. Then I don't understand it properly.
    That's why I am asking the question.
        So the red bars are the investment in the new system. Then
    what are the green bars?
        General Scott. The green bar would show that we estimate by
    the year 2000, as a result of this investment in this new
    system, that we would recoup about $3.4 million in productivity
    to reallocate to other necessary needed functions, such as the
    arrearage and collections security.
        Senator Bennett. I am glad to have that because I had
    understood that the red bar is what you are paying for the
    present system and that will come down to zero, and the green
    bar as what you are investing in the new system and the amount
    of money we have to pay as the combination of the two bars.
        General Scott. No.
        Senator Bennett. I get it now that the green bar should
    actually be below the line as a saving.
        General Scott. The red bar is what it will take for us to
    put in the new system.
        Senator Bennett. But the green bar is the saving?
        General Scott. The green bar would be the savings.
        Senator Bennett. Not an expenditure?
        General Scott. Not an expenditure.
        Senator Stevens. If it is reinvestment, you are really
    using the people that you are freeing up by the modernization
    in other aspects and you will not have to hire new people. But
    it is a reallocation of manpower more than it is money as I
    understand it.
        General Scott. Yes, sir; that is correct.
        Senator Bennett. OK. I am glad to get that clarification.

                            Electronic transactions

        You say that you've got four times the hits on your home
    page than you had in 1993. Did I understand that correctly?
        Dr. Billington. Yes; well, that is total electronic
    transactions.
        Senator Bennett. Total electronic transactions. OK.
        Has there been a corresponding or any kind of measurable
    decrease in transactions that are not electronic that would
    indicate there is any kind of shift away from traditional ways
    of accessing the Library toward the electronic? Or could you
    say that has all been incremental?
        Dr. Billington. It is practically all incremental because
    there has been very little change in the basic amount. We get
    more than 1 million inquiries every year from around the
    country and that has stayed fairly constant. These are the
    traditional reference methods, with people telephoning in or
    making use of the Library. There has not been a dramatic change
    in interlibrary loans which we do free. Other libraries charge
    for it.
        So this electronic access is largely additive. It is very
    exciting because it means a whole new universe is coming in to
    use Congress' Library that has never really had access to it
    before. It shows that the largest single component in those 42
    million a month is for the THOMAS system, which shows an
    interest in the functions of the Congress. But the national
    digital library, the digitization of the core things in
    American history for educational purposes is rapidly rising in
    its usage, too.
        Exhibits are also widely used. All of the Library's major
    exhibits in the last, I guess, 4 years now have been put
    online. They get greater usage all the time, classroom usage--
    and so forth.
        So there is a very well spread and rapidly developing thing
    here. That is all incremental. Almost all of it is incremental,
    added usage of the Library.

                                   Year 2000

        Senator Bennett. In one of my other assignments, I am
    focusing on the challenges and costs of dealing with the year
    2000 problem as it affects computers.
        General Scott, as you look forward, are you going to have
    some year 2000 programming problems? How much are they going to
    cost to fix if they are there? Or are you free of that
    situation?
        General Scott. Yes, sir; we are not free of the year 2000
    problem. We have started to examine the magnitude of the
    problem and we have made some assessment that if we are
    fortunate enough to get the ILS going, that will help us
    resolve the year 2000 problem. If not, then we still will have
    a year 2000 problem and we are still looking at the effort it
    is going to take to resolve it without an ILS. But I don't have
    a price tag that I can give you right now.
        Senator Bennett. Do you have any kind of estimate? It is
    not going to be in this bill. Is it going to be in a
    supplemental or in next year's bill?
        General Scott. I would like to defer that to Herb Becker or
    I could give that to you for the record, sir.
        Senator Bennett. Fine. Thank you.
        [The information follows:]
                                     The Librarian of Congress,
                                         Washington, DC, June 25, 1997.
    Honorable Ted Stevens,
    Chairman, Committee on Appropriations, United States Senate, S-128,
            Capitol, Washington, DC.
        Dear Mr. Chairman: I am pleased to provide the following responses
    to the several questions you raised in our recent Senate Appropriations
    hearing. We appreciate and share your concerns, and we are focussing
    significant resources on these important matters.
    Federal Communications Commission ruling on universal access
        While interested parties have already convened major efforts to
    educate potential beneficiaries, much is still unknown about the impact
    on the Library of this May 7, 1997, ruling. The Universal Service Fund,
    which could make up to $2.25 billion available annually, will require
    an organizational structure and procedures which are not anticipated
    until calendar 1998. Some 65 percent of the K-12 schools are already
    wired to the Internet,\1\ and the Library's National Digital Library
    (NDL) is already being utilized by a large number of schools. The
    Library's NDL is providing well-organized and rich content on American
    history and culture that is of broad interest to teachers, students and
    parents. The Library has been working with teachers for several years
    specifically to develop materials useful to them. However, the Library
    does not see technology training as an appropriate part of our mission.
    ---------------------------------------------------------------------------
        \1\ National Center for Education Statistics survey, February 1997.
    ---------------------------------------------------------------------------
        We are continuing to select from those items of broadest interest
    and importance for the educational community, which is one component of
    Secretary Riley's 1996 National Long-Range Plan for Educational
    Technology. The Library will work in consultation with the Department
    of Education on other elements of the plan as appropriate, but we see
    our function as being limited to the historical library mission of
    making quality content more widely accessible.
        The Library's own cumulative growth over the last two years, as
    judged by ``hits'' or electronic transactions recorded on our website,
    has doubled each year since 1995. This growth mirrors the increase in
    Internet users. Our current systems planning and investments are
    predicated on this pattern of continuing growth. With the universal
    service initiative, we will continue to monitor its impact closely and
    revise our planning and resource requirements accordingly. As I stated
    at the hearing, providing continuing access to our collections is not
    nearly so costly as the one-time investment needed to digitize a wide
    variety of different, often multi-media, formats from the Library's
    collections that we are including in the NDL.
    Impact of the Year 2000
        Using a model similar to the GAO Year 2000 Conversion Model, the
    Library is assessing the impact of the year 2000 on our automated
    systems. Our financial, personnel, reader registration and other
    commercially-supported systems will be compliant. Our office automation
    systems will be migrated to newer office systems and will be
    implemented with Year 2000 compliant software. Our telecommunication
    (data/voice) systems have been assessed and are already compliant.
    Copyright systems will be migrated to new software and hardware systems
    which will be Year 2000 compliant. We have identified specific
    replacement systems for each retrieval application, such as those in
    the CRS SCORPIO system, which will be in place for Year 2000 operation.
        The Integrated Library System (ILS) requested in fiscal year 1998
    is indispensable to making the Library's major bibliographic and
    inventory controls Year 2000 compliant. Our ILS request-for-proposal
    provides that the new system comply with Year 2000 requirements that
    the Senate has identified and endorsed. The most substantive support
    the Congress can provide the Library to address the year 2000 problem
    is to fund fully the 1998 ILS initiative.
        We will insure that all other automation systems being replaced are
    delivered with the capacity to manage this problem.
    Computer Security
        In response to the recent incident where CRS Issue Briefs were
    compromised, we have thoroughly analyzed the events that allowed
    unauthorized access. This specific incident happened because of an
    application programming problem. That problem has been resolved. As a
    standard practice, we report all automation system ``Incidents'' to the
    National Computer Emergency Response Task Force (CERT) which tracks
    trends and patterns in computer abuses. We have recently cooperated in
    a pilot program with the National Institute of Standards (NIST) to
    design an incident-handling system. In addition, with contractor's
    assistance, we have recently completed a risk assessment of our
    computer center, and with the help of KPMG, we recently completed an
    Internet security scan. We are using this information and the
    identification of high-risk vulnerabilities in these two studies to
    draft a plan for systems security by the end of July 1997. Preliminary
    plans suggest that we will need an additional $400,000 in the near
    future for computer security upgrades. We will provide the Committee
    with possible additional needs for the longer term and our over-all
    program for systems security after our plan is completed.
        We have implemented improved back-up and recovery procedures
    through data-vaulting in a cooperative arrangement where we share space
    in our computer center with the House for its back-up storage
    equipment, and the House reciprocates. Our workstations are configured
    with standardized communications software to mitigate against computer
    viruses and abuses. AT&T provides the Library with a monthly audit of
    ``attacks'' against our telecommunications systems. The Library will
    continue to participate in legislative branch initiatives to refine
    CAPNET security.
    Authority to Deter and Respond to Computer System Breaches
        All legislative branch information technology offices should have
    standardized measures to respond, through legal prosecution, to
    computer security breaches. The Library will participate in any
    procedural or statutory review that seeks appropriate standardization
    within the legislative branch.
        We look forward to continuing this discussion with you and the
    committee, as well as our colleagues on the Hill. We will, of course,
    provide more detail or answer any further questions you may have. Thank
    you again for your continued interest in, and support of, the Library.
    I have forwarded a copy of this letter to Senator Bennett and to
    Senator Dorgan. Merely,
                Sincerely,
                                           James H. Billington,
                                             The Librarian of Congress.

                     money raised through private Donations

        Senator Bennett. Senator Dorgan.
        Senator Dorgan. Dr. Billington, I wanted to ask you a
    question about the amount of money that you have raised. You
    have raised some private donations to the goal of digitizing
    millions of Library of Congress items and developing a digital
    library project. As I understand it, you have a private
    donation goal of about $45 million.
        Dr. Billington. Yes, sir.
        Senator Dorgan. And you have raised about one-half of that.
    I want to ask two questions about that.

               coordination of LOC's digital project with others

        One, how is the Library coordinating its work on the
    digital project with other libraries to prevent duplication of
    effort?
        Dr. Billington. First of all, we have taken the lead in
    forming with 15 other major institutions a federation, a
    digital library federation, in order to coordinate. We have
    been working with them on standards, on setting standards, and
    storage protocols. The Library in 1902 assumed for the print
    culture the major burden of cataloging, which we still assume,
    which is an enormous and invisible subsidy to the library
    system of America, as it costs more to catalog a book than to
    buy it. Likewise, what we are doing in the digital universe is
    we are coordinating with the major repositories in this
    federation.
        Second of all, we have raised some private money
    specifically for other institutions, one of which was North
    Dakota State University, which was a successful competitor in
    our Ameritech competition. Incidentally, the Library does not
    pick the winners. We do not want to be in the business of
    playing God in this respect. But we had some outside panels
    that are very capable here. This competition stimulated
    tremendous interest.
        We had hundreds, well dozens, of interesting applications
    from all around. There were 10 winners. We will have two more
    of these competitions. It is money that we raise, not for the
    Library, but to bring in others so that this is a genuine
    national digital collection, even beyond the collections of the
    Library of Congress.
        So we have taken the lead. We have developed a kind of
    archival protocol which, at the request of the other
    institutions, we are maintaining and keeping up so that there
    is a central reference point on this. The work we are doing
    with the national digital library is setting, I think,
    standards of searchability and standards of indexing that we
    are, more or less, coordinating continually with other
    institutions. So I think this is developing rapidly as a
    cooperative undertaking.

                          cost of Digitizing materials

        Providing online access is exciting because it means that
    we are assuming, I think, a doubling of Internet traffic every
    year. So we are already in our planning--while it is going to
    take some upgrading in capacity to deal with--it will not take
    as much as you would think. The real expense is digitizing
    materials. That is $60 million, $45 million of which comes from
    the private sector, is going to do. We are going to digitize 5
    million items by the year 2000.
        We have about 350,000 already digitized for which we are
    getting 5.5 million transactions a month directly, and that has
    only begun. We have 1.7 million items in the pipeline. We have
    well over one-half now of the private money raised and we are
    hopeful that we will be able to raise the rest. There is a lot
    of interest in this and there is also an interest in developing
    exciting cooperative projects, which we are discussing with a
    number of people.

                          LOC's network relationships

        What you are really seeing emerge is a new type of library
    that is going to be available everywhere. You won't even have
    to go to the library to get this material. It involves all
    kinds of network relationships.
        The Library is trying to enter in and play a facilitative
    role, as General Scott has told us about. Facilitative
    leadership does not mean you do it all yourself; rather, you
    facilitate others to participate. So we already have now 10
    other institutions who are digitizing their material with money
    that we have raised for them.
        There will be two more competitions. In addition, a lot of
    people have been stimulated because of entering this
    competition to think of digitizing their material. So it is a
    very exciting cooperative operation.

                      Storage as a possible future expense

        One of the possible future expenses, of course, is the
    question of storage. We think that is going to be a distributed
    activity. It is important that people not only get their
    collections on the Internet but that they have a stored backup.
    But we think that is something that other institutions will be
    able to do, but requires maintenance.
        So the burden of central storage is not going to be nearly
    as great, we do not think, as the heavy startup burden. It is
    the same thing with the integrated library system. For the year
    2000 problem, it is going to be much easier to deal with that
    if we have an integrated library system and we do not have to
    make the adjustments on each of these smokestack systems we
    presently have.
        That is another reason for moving ahead with that.

                       Grant from the Kellogg Foundation

        We think this is very exciting. It is going to involve some
    added expense and there will be some unforeseen problems. But
    these are being talked about in a cooperative spirit among the
    major institutions. We are also involved, incidentally, in
    determining what gets into the digital library--that is the
    core of the Americana--we are involving teachers. We have a $3
    million grant from the Kellogg Foundation which we have just
    completed and we are hoping to devote some of that $60 million
    to sort of seeding, to getting some of the top notch teachers
    around the country to advise what it is people really want and,
    indeed, to establish protocols of how you could use this for
    teaching purposes.
        We are not trying to prescribe a course on American
    history. We are just simply trying to make accessible to the
    electronic age what the Congress did just a century ago by
    opening up public reading rooms and making its Library
    accessible to the public who could get to Washington. We are
    now trying to take the best of it, the most interesting and
    important parts of it, those items of wide interest, make them
    available to the general public, but particularly to the
    schools and libraries in the electronic environment.
        So we are not really delivering products. We are not going
    to get engaged in all of that commercial activity. The market
    will take care of that.

                            expense in Digitization

        The fundamental expense is the problem of digitization
    itself, which is extremely labor intensive when you are dealing
    with the wide variety of formats and materials that we have.
    While the price may come down to some extent, that is still
    going to be a big expense.
        But in other areas, the rapid development of technology and
    the improvement in the competitive atmosphere which is
    developing gives promise that, while there will be increasing
    expenses so that you do not buy yourself into obsolescence,
    there will also be offsetting economies as the market drives
    this forward.

                          Fort Meade storage facility

        Senator Dorgan. May I ask one additional question about the
    plans that you have for Fort Meade and the additional record
    storage? You were talking about 1999 in your statement.
        Would you describe your long-term plans that provide for
    expansion beyond that? If so, what are they?
        General Scott. Yes; we do. If it is all right, I would like
    to ask Linda Washington to come forward and explain that if it
    is all right with you.
        Senator Dorgan. Yes; and just briefly, please.

                           First book storage module

        Ms. Washington. We are planning this now. We have
    coordinated with the Architect of the Capitol the utilization
    of the Fort Meade facility and we are planning to have our
    first book storage module ready in mid-1999. Thereafter, we
    will have another storage module every 2 years. So we do have a
    5-year plan for utilization of the Fort Meade facility for book
    storage and for storage of other material as well.
        Dr. Billington. I think we expect to break ground, do we
    not, by the end of this year, the Architect of the Capitol, on
    the first of these?
        Ms. Washington. Correct.
        Senator Dorgan. Thank you.
        Senator Bennett. Senator Stevens.

                   hooking schools to LOC information systems

        Senator Stevens. Dr. Billington, you and I had an informal
    discussion yesterday, and Senator Dorgan is on the Commerce
    Committee, too. We were informed about the rapid acceleration
    of hooking up the schools of the United States to the
    information systems of the country, if not the world.
        Basically, that means hooking them up to you. I want to
    make sure that we have the funding now to handle that rapid
    expansion of demand when it comes about. Were you there,
    Senator, when they talked about the President's program to
    utilize funds from the universal service concept to hook up all
    of the schools of the United States? We are not talking about
    just simple access. It means, I understand, a substantial
    increase in the total number of classrooms that will be capable
    of teaching children totally on computer.
        Now what that does, in my mind, is say that you have to be
    ready for that. Will you be ready for it?
        Dr. Billington. Well, I think we will be ready to do our
    part in that, which will be substantial. But as I already
    indicated in my answer to the previous question, the way this
    is developing--the way it has to develop--is in a cooperative
    network environment. So I do not think all of the burden will
    fall on us, but a very substantial amount will.
        Our present planning assumes, as I say, a doubling of our
    web site activity every year to the end of the century. I think
    that is a realistic projection. It is impossible to give you
    precise figures on this, but I would assume that for constant
    service, related equipment, and updating in order to keep up
    with demand, it will cost us perhaps $200,000 a year more. But
    we don't foresee, you know, major breakdowns. We don't foresee
    that there is going to be some wild escalation of prices. But
    there are a lot of uncertainties in all of this.

                             Upgrading the systems

        I think that we have begun already, for instance, technical
    planning to upgrade the speed of our Internet connection. We
    are currently installing increased server capacity, and
    planning for the acquisition of more. We will soon be
    implementing a high speed backbone network within our computer
    center.
        All of these are within plans, those actions that are in
    our current equipment/software based budget, and assume that
    the technology budget will not be either cut directly by the
    Congress or indirectly by allocating technology funds to other
    programs inside the Library.

                                 Budget impact

        We see three major impacts, budget impacts, resulting from
    an increasingly digital world and the digital conversion of
    conventional materials. That is the most predictably expensive
    thing. We have front loaded a big effort to get these 5 million
    items in NDL so that we can really make a major impact early on
    in the educational life of the country. Also we are finding
    that the experience we are getting is of great value to others
    and to ourselves, and, with the national digital library, to
    our other efforts. But that is the big expense because it is so
    labor intensive.

                            additional Storage media

        Second, additional storage media will be necessary for
    these digital collections and data bases. We do not see
    ourselves assuming the storage burden for everybody else, as
    other players come into it, because that will be a distributed
    cost, and the network costs in general are going to be
    distributed costs.

                              Software development

        The third expense is software development and maintenance
    of necessary applications to organize, store, and provide
    retrieval to the growing volume of digital information. That is
    a much harder need to estimate.
        But the real answer to your question is that this is a
    major continuing adventure, really, and we are out there in the
    frontier.
        I do not think, though, at least we do not presently
    foresee, that even this highly accelerated and increased usage
    is going to cause major, additional expenditures or a very
    serious breakdown.
        Senator Stevens. Do you have anyone that is acting as
    liaison with the administration's program to understand the
    demand that is coming from their activities?
        Dr. Billington. I think we have several committees. I would
    refer this to Herb Becker who would be the best person to
    respond to that as the head of our information technology
    services area.

                   concerns for school hookup to the Internet

        Senator Stevens. It is a simple question. Is there anyone
    working with the administration to understand the scope of the
    demands that will come on the Library as a result of the
    initiative to hook up all of the schools to the Internet?
        Mr. Becker. I should say that we are monitoring very
    closely what the administration's program is. There are a
    number of organizations that include people from the Federal
    Government as well as the library and university community,
    like the Coalition for Network Information, which track what is
    going on, which have briefings and seminars and invite
    administration leaders to talk about their plans.
        There are a number of techniques for keeping up with what
    is going on. There is a group that is part of the information
    infrastructure task force, an applications group of which I am
    the Library's member. We used to have formal meetings. Now we
    communicate mostly by e-mail over the network. So we are aware
    of the administration's goals that way.
        I should also say that we, at the Library, in the
    technology area, have continuing meetings with the
    telecommunications industry who are involved in making these
    infrastructure investments across the country to find out the
    progress and the speed with which this is all happening.

                       Federal Communications Commission

        Senator Stevens. Well, I urge you to get together with FCC
    and understand what they are doing because they have decided
    now to use a fund that is available. It won't be the private
    sector directly. But the private sectors contribute to this
    fund. That fund will be dedicated to this one, sole objective,
    and their objective is to have it done by the year 2000. If
    they have it done by the year 2000 and you are not ready for
    that onslaught, we are going to face substantial costs which we
    might be able to handle on an incremental basis now much
    easier.
        So I think you ought to find out about this. It is not
    going to be an evolutionary thing with industry coming in and
    hooking up as they want. The cable people thought they would do
    it over a period of 10 years. The telephone people thought it
    would be 10, 12, or 15 years. This plan now is to have it done
    by the year 2000--2\1/2\ years away. It is going to happen and
    it is going to happen with the use of this universal service
    fund.
        I am not going to belabor this but I think it is going to
    bring you a wave that is a sunami in terms of the impact on the
    demand for information services and you are the keystone of
    that.

                       concerns on the Year 2000 problem

        I will just leave it there, Mr. Chairman. But on the year
    2000 problem that the chairman mentioned, I looked into that
    substantially when I was chairman of the Governmental Affairs
    Committee. My conclusion was that if institutions were
    modernizing their computer systems and integrating the new
    computers within the system, it was a fairly simple matter to
    handle the year 2000 problem which, basically, was that the
    numbers would run out at the year 2000 and you could not
    compute beyond 2000.
        The new computers did not have that impediment built in. I
    guess their limit is the year 3000, which we don't need to
    worry about yet, right? [Laughter.]

                       funding to avoid Year 2000 problem

        Have you looked to see how much--and you have sort of
    answered the chairman's question? Is there any additional
    funding you need now to avoid having a year 2000 problem?
        General Scott. I would like to take a crack at that. We
    don't know exactly what we will need right now as far as money
    goes.
        Herb, would you say it would be another 4 or 5 months
    before you complete all of your assessments?
        Mr. Becker. Yes; that's true.
        We have a great variety of systems in the Library. Some of
    them are being modernized and a solution to the year 2000
    problem is exactly what you have said, Senator. It goes away
    with the replacement system.
        Some of the systems are supported by commercial vendors and
    they are developing new software. Our financial management
    system is supported by AMS and the next release of that system,
    which we will implement early in 1998, will be year 2000
    compliant. So there are a variety of solutions.
        One area where we have the biggest challenge is in what we
    refer to as our legacy systems that support the direct library
    activities for which we are proposing a replacement. The ILS
    would replace those and modernize that whole environment and
    deal effectively with the year 2000 problem.
        Senator Stevens. I discussed the matter with Arnold
    Penzias, who was the head of Bell Labs and now he has his own
    company. He examined it for the Bell system and came to the
    conclusion that it is manageable for those who are modernizing.
    It is not manageable for those who are not in a modernization
    program.
        So I think if you have it in the forefront of your mind as
    you modernize, we should not have any unforeseen demands for
    money in the year 1999, which is what we would look at. Right?
        We can be assured that in 1999 we are not suddenly going to
    wake up and find out we need hundreds of millions of dollars to
    replace systems now, are we?
        General Scott. We do not foresee that. And, of course, as I
    said, a lot of what we are counting on is getting this new,
    integrated system.
        Dr. Billington. I think the integrated library system will
    do precisely what you say. It will give us a central system
    that, in itself, will be modernized, rather than a lot of
    inefficient and expensive submodernizations of other systems.
    So if we can assume that we are going to be going ahead with
    that, we will have a cost of this conversion that will be much
    less and that we will try to compute for you in the next few
    months when our internal study is done.
        Senator Stevens. I am using more than my share of time but
    I do have one last question, Jim, before I have to leave.
        Dr. Billington. Yes, sir.

                              Digitizing materials

        Senator Stevens. It is this. You are digitizing new
    acquisitions immediately, right?
        Dr. Billington. No.
        Mr. Becker. No.
        Senator Stevens. You are not? How do you determine whether
    you digitize, then, in terms of new acquisitions?
        Dr. Billington. We are not basically digitizing new
    acquisitions. We are digitizing the most interesting and
    important elements of past Americana for the national digital
    library, our digital project. We will shortly be receiving a
    great number of collection items in digital form. We already
    have a public catalog and we are receiving digital materials.
        Senator Stevens. Let me back up. One of the reasons you get
    books is that we have a requirement about providing copies to
    the Library of Congress. Should we change the law to make sure
    that any books that are digital and that do have the digital
    capability, are filed with you in both ways, both as printed
    and digitized material?
        You don't need to answer that now. You can answer it later.
        [Clerk's note.--The information is provided in the
    committee questions for the record.]

                          Fort Meade storage facility

        Senator Stevens. The thing I am getting at right now is
    this. With your digitized material, you are going to store the
    stuff that has been digitized.
        Dr. Billington. Yes, sir.
        Senator Stevens. Is that what the Fort Meade facility is?
        Dr. Billington. Well, no, that is not what Fort Meade is
    for. Fort Meade is for basically storing the large, archival
    items, books, and other materials.

                         security plan for LOC systems

        Senator Stevens. I don't know that the authorizing
    committee has looked at the security plan. Has it looked at the
    security plan?
        Dr. Billington. At which security plan?
        Senator Stevens. Security for your systems, both those that
    are computerized and the storage as far as materials are
    concerned. You do have a new security plan?
        Dr. Billington. Yes; we do.
        Senator Stevens. Has that been approved by the authorizing
    committees?
        General Scott. It has not been approved. We have had
    preliminary discussions with the authorizing committee staff
    about review of the plan when completed.
        Senator Stevens. I would like to make sure that it is and
    that there is a determination made that the existing law is
    adequate to give you the authority that you need to protect the
    security of these systems, particularly those that are totally
    computerized and digitized.

                                 System viruses

        Some of the things I am hearing now concern a new
    generation of viruses that can be entered into a system as
    large as yours. Are we adequately protected?
        Dr. Billington. We have a committee looking into that. We
    corrected a recent element that was of concern to CRS. That has
    been taken care of.
        We have a committee that is looking into this very
    thoroughly; this is an important area that we will have some
    firm policies on that we will present to the committees.
        Senator Stevens. The Department of Defense has some very
    specific legislative protection and the capability to really
    retaliate very quickly on anybody who gets involved in this.
    You ought to have at least equal to that if you are the
    information center of this Congress and of the Federal
    Government. So I want to make sure you take it to the
    legislative committee.
        Thank you very much, Mr. Chairman.

                                    Security

        Senator Bennett. Thank you. That was one of my questions as
    well, the question of security.
        I have a list of questions that I will submit for the
    record and you can respond to them in writing. But I want to
    underscore what Chairman Stevens said about the issue of
    security.
        General Scott. Right. And, as Dr. Billington said, we do
    have a committee. We have corrected the recent incident in
    which someone had misfiled some legislative information which
    caused someone to have access to it.
        But we are in the process now of identifying what needs to
    be done and how much it would cost to make sure that we have
    the necessary software and procedures to harden it up.
        Senator Bennett. Senator Dorgan, do you have any further
    questions?
        Senator Dorgan. No, thank you.
        Dr. Billington. I would just like to say, Mr. Chairman, on
    this other issue, that we will also take a hard look at the
    administration plan to wire schools and libraries and what its
    implications are. So I assume it will be useful to get back and
    answer both Senator Stevens' concern and the subcommittee's
    concern.
        Nobody really knows and one isn't even entirely sure, as I
    understand it, of all of the implications of the plan to get
    the schools wired up. But we will try to get you an indication
    of the study, do a special study on this problem and get it to
    you some time in the next few months.

                         Additional committee questions

        Senator Bennett. Fine. Thank you very much. We appreciate
    your being here and look forward to receiving answers to some
    of our written questions.
        If there is nothing further, thank you and we will go on to
    the Government Printing Office.
        Dr. Billington. Thank you, Mr. Chairman.
        General Scott. Thank you, sir.
        [The following questions were not asked at the hearing, but
    were submitted to the Library for response subsequent to the
    hearing:]
                         Additional Committee Questions
                                financial audit
        Question. The Library recently received a clean opinion on their
    financial statements. Were there any material weaknesses or reportable
    conditions associated with the audit, if so, please explain.
        Answer. The 1996 financial statement audit report represents a
    major achievement for the Library as a result of receiving a ``clean''
    opinion on the financial statements, but it also reiterates that more
    work is needed to address all of the Library's internal control issues.
    The independent accounting firm, KPMG Peat Marwick, identified one
    material weakness and seven reportable conditions.
        The accounting firm made 43 recommendations to address the need for
    internal control improvements. Most of the recommendations relate to
    conditions found during the 1995 audit that require more time to
    implement. For example, eleven out of the 43 recommendations (26
    percent) pertain to improving the safeguarding of the Library's
    collections--a long-term task. The one material internal control
    weakness addresses the security practices over information technology
    systems. The Library has already taken steps to improve these security
    practices (e.g., requiring that the Computer Security Officer sign off
    on the separation clearance forms), and the Library is taking
    additional steps to implement the recommendations.
        The 1996 audit found two new reportable internal control
    conditions--year 2000 compliant software changes were needed and that
    the Inspector General's oversight functions were limited. The Library
    is taking steps to address both of these findings.
                                internal control
        Question. What has the Library done over the last year to safeguard
    its assets? Does the Library believe that it now has the internal
    controls in place to adequately safeguard the collections?
        Answer. Over the last year the Library has implemented the
    following measures to improve safeguarding of the collections: improved
    and modernized cages and vaults holding high value collections;
    increased locking of work places in selected areas; updated
    instructions and procedures for administration of stack passes and key
    cards; enhanced key control by completing an inventory of 5,000 keys
    and documenting procedures for key control; imposed restrictions on
    bringing personal items into selected reading rooms (patrons must use
    cloak rooms and lockers for personal belongings); installed
    electronically controlled access system in book storage areas on
    Capitol Hill; inserted anti-theft strips in nearly 1 million additional
    volumes, bringing the total number of volumes thus protected to over 5
    million; and completed installation of closed-circuit video
    surveillance cameras and other electronic security systems in newly-
    reopened areas (reading rooms and stacks) of the Jefferson and Adams
    Buildings.
        Also in the past year, the Library began the multi-year task of
    assessing risk to the collections (the Heritage Assets), of identifying
    actions and practices to mitigate those risks that have not yet been
    addressed, and of implementing those recommended actions and practices.
    In addition, it is developing a methodology to review those internal
    controls annually, as part of the annual audit process. A task force
    comprising representatives from all parts of the Library that have
    permanent or temporary custodial responsibility for the collections is
    working with an outside auditing firm to develop a systematic risk
    assessment of the Heritage Assets (something that has never been done
    by a comparable institution and for which there is no existing model).
    The task force has completed a full risk assessment of one collection
    area (Geography and Map) and has moved on now to do the Copyright
    Office.
        While great progress has been achieved, the Library does not yet
    have adequate internal controls in place for the over 112 million items
    which comprise the Heritage Assets. Of the four major areas of
    control--inventory, bibliographical, preservation, and physical
    security--the area of greatest vulnerability, inventory, cannot
    properly be controlled until the full implementation of the ILS, for
    which the Library has requested funds in fiscal year 1998.
    Bibliographical controls are addressed by the Library's Arrearage
    Reduction Plan, which continues to be implemented according to
    schedule. The single most important initiative for preservation control
    is the building and proper outfitting of environmentally controlled
    storage modules at Ft. Meade, for which funds have also been requested.
                               title 44 proposal
        Question. How will the proposed Title 44 revisions affect the
    Library's collections and its budget?
        Answer. The draft proposal's treatment of the Library is unclear.
    Specific Title 44 changes would await subsequent legislation.
        Several likely changes to Title 44 contemplated by the proposal
    would be detrimental to Library service to Congress, and to its
    collections and programs. Examples:
      --the possible end to the Library' statutory guarantee of
            Congressional and other federal publications would greatly
            hamper the Library's ability to serve the Congress. When
            Congressional documents were discontinued through the fiscal
            year 1996 appropriations process, the Library found it
            necessary to obligate more than $150,000/year to purchase the
            minimum necessary to fulfill Congress' research needs. This
            means, for example, that the Law Library has had to reduce its
            acquisitions of other legal materials by $1 for each dollar
            spent on the purchase of Congressional documents. It would cost
            upwards of $1,000,000 to purchase all federal publications, and
            the Library would need additional resources to identify and
            request federal documents needed for Congressional research,
            for exchange purposes and for the collections.
      --the proposed elimination of cooperative publications, and
            vulnerability of our employees to personal civil liability for
            engaging in cooperative publishing activities, would
            effectively end private publications, based on the Library's
            collections, that are now produced under contractual
            arrangements that benefit the Library as well as the public.
      --the implied repeal of the current copyright protection against
            unauthorized foreign distribution of government publications
            would end the Library's ability to license foreign distribution
            of cataloging and other products.
                             capitol visitor center
        Question. The Library recently testified before the House
    Subcommittee on Public Buildings and Economic Development regarding the
    Capitol Visitor Center. What costs does the Library anticipate it will
    occur on a one-time basis and on a yearly basis if it is connected to
    the Visitor Center as currently included in the Architect of the
    Capitol's plan?
        Answer. The means of financing for the construction of the proposed
    Capitol Visitor Center has not been determined. H.R. 20 envisions
    totally private funding for Center construction. The cost of
    constructing the Library-requested auditorium and ancillary viewing
    rooms are estimated to be approximately $10 million. The costs of
    constructing a tunnel between the Center and the Thomas Jefferson
    Building which would allow for the easiest movement of people and
    materials is estimated at about $5 million with an additional $3 to $5
    million needed for interior modifications to the Jefferson Building.
        Once the Center is constructed, the Library of Congress will
    participate by (1) providing unique materials from our collections for
    the Center's exhibits on the history and role of Congress, and (2) by
    showing items from our audio and visual collections in the auditorium
    and other smaller viewing/listening rooms.
        It is difficult to estimate resource requirements at this time
    because the Center's exhibition and program cycles have not been mapped
    out. We expect that we can do a fair amount of program participation
    from existing resources. For large projects, such as major exhibitions
    or programs in the auditorium, we would require additional resources,
    which we expect would be primarily from private funding.
                                  staff level
        Question. In response to a question previously submitted, CRS
    responded that it was not able to determine whether there had been an
    increase as projected in requests from offices regarding the Personal
    Responsibility and Work Opportunity Reconciliation Act of 1996. If that
    is the case, how does CRS determine staff levels for specific analytic
    expertise areas?
        Answer. CRS division chiefs are responsible for identifying the
    expertise they need to cover Congress' legislative agenda. They do so
    through a variety of mechanisms, including assessment of issues or
    policies which will have certain or likely congressional action in the
    next Congress, evaluation of the expertise available in CRS, appraisal
    of the current and expected workload of subject area specialists, and
    identification of ways in which staff on board can be developed to
    facilitate shifts in subject coverage. While these assessments and
    projections are integral to day-to-day management of the research
    activities in each subject division, there are also periodic formal
    CRS-wide reviews.
        These reviews, led by the Director, assure that hiring,
    reassignment, and detail, and other resource allocation decisions are
    made in the context of the legislative agenda and Service-wide needs.
        After assessing critical work needs, managers submit to the
    Director requests for staff resources and include information and
    analysis as part of the request, including: (1) How does the requested
    position help achieve the CRS' mission (e.g. new initiative,
    maintaining workload); (2) What are alternative ways of providing the
    service (details from other areas, reassignments, contracts, etc.); (3)
    What is the relationship to our current or expected workload; (4) What
    is the relationship to existing or anticipated shortage of expertise,
    including the impact of projected retirements; (5) What is the
    relationship to legislatively active subject areas and what is the
    likelihood of the subject area staying on the legislative agenda; (6)
    How would the position contribute to coverage of other related issues;
    (7) What are the immediate and future costs of the additional resource;
    (8) What are the current division and Service-wide capacities to
    support the legislative agenda in the subject area; (9) What measures
    has the division already taken to address the need; and (10) What is
    the appropriate scope of recruitment and what is the likely impact on
    diversity and upward mobility objectives.
        All of these requests are discussed at a Research Policy Council
    meeting, a weekly meeting held with the division chiefs, associate
    directors, deputy director and the director. Other managers ask
    questions and make suggestions about the request, and there is an
    effort to reach consensus about the highest priorities. After this
    meeting the director decides on the highest priorities that can be
    addressed within current budget restrictions.
                            security management plan
        Question. Has the Library completed its security management plan
    and has it been presented to the authorizing committees?
        Answer. The Library has completed a preliminary security management
    plan. The plan has been reviewed by the new Director of Security, and
    he is now making enhancements to it. The enhancements being made to the
    preliminary plan are adding specific security actions and timetables,
    and establishing milestones. The final plan will serve as the guiding
    document for all our security efforts, including collections security,
    physical security, information security and personnel security.
        Finalization of the plan for presentation to the Library's
    authorizing committees is being given top priority by the Director of
    Security.
                           congressional publications
        Question. What items and approximately how much does the Library
    pay to the Government Printing Office to secure government documents
    for its work and collections?
        Answer. The Library is currently spending approximately $210,000 to
    acquire Congressional publications needed for its collections,
    international exchange, and use by Congressional Research Service (CRS)
    staff. These publications include hearings, committee prints, the
    Congressional Record, Statutes at Large, House and Senate journals, the
    Economic Report of the President, the Budget, Statistical Abstracts,
    and other documents.
                          management improvement plan
        Question. One of the Management Improvement Plan recommendations
    last year was for the Library to establish a position of Chief
    Information Officer. Why has the Library's Executive Committee deferred
    its decision to establish the position?
        Answer. Deputy Librarian of Congress Donald L. Scott was appointed
    to his position in October of 1996 and charged with managing the day-
    to-day operations of the Library. General Scott required a six month
    period to learn, review, and assess the structure, personnel,
    operations, and present and future challenges of the Library's
    Information Technology Services directorate. The Deputy has concluded
    that ITS is a one-of-a-kind unit whose main operations are composed of
    a mix of internally-developed and commercially-procured automated
    systems. A great number of those legacy systems are in dire need of
    replacement with an integrated, off-the-shelf vendor's system. Given
    the challenges facing ITS, the Deputy Librarian concurs with the
    external recommendation to establish a CIO position and will recommend
    to the Executive Committee that the Library proceed with the
    establishment and filling of this position beginning in July 1997.
                                police overtime
        Question. The Library plans on reducing the amount of overtime
    worked by its police force to 10 percent and hire additional police to
    provide necessary coverage. What is the cost savings estimated for
    fiscal year 1998 due to the hiring of additional police?
        Answer. No cost savings are estimated because a new police FTE
    costs more than equivalent overtime hours. A police person's assignable
    (regular) work hours total 1,445 out of a total 2,087 payable hours a
    year (non-assignable hours include leave and training time). In
    addition, employee benefits (approximately 27.6 percent of total base
    salary) do not increase for overtime hours. Therefore, one new police
    FTE that costs $45,930 (including benefits) is equivalent to 1,445
    overtime hours that cost $37,382. The Library is planning to reduce
    excessive overtime to improve the effectiveness and quality of police
    performance, but this effort will not decrease costs.
                       fiscal year 1998 budget priorities
        Question. What are the Library's priorities in its fiscal year 1998
    budget?
        Answer. The two highest priorities are mandatory pay and price
    level increases totalling $14.7 million. These increases are needed to
    maintain current services. Without funding for mandatory pay increases
    ($10.7 million), the Library would need to cut 178 positions, which is
    on top of the 435 FTE's lost since 1992--a cumulative cut of 13.6
    percent since 1992. A price level increase is necessary to sustain our
    purchasing power for goods and services including books, machine-
    readable works, and other materials. The amount of material we can
    afford to purchase from appropriated funds has declined seriously--from
    930,747 pieces in fiscal 1992 to 707,695 pieces in fiscal 1996. We must
    not permit further erosion in these acquisitions--particularly since
    these reductions disproportionately hurt precisely those foreign
    acquisitions which only the Library of Congress makes and which often
    have growing importance for our international competitiveness. We
    should not risk depleting what is, in effect, the nation's strategic
    information reserve. It will have many uses tomorrow that we cannot
    even imagine today.
        The next two highest priorities would be the Integrated Library
    System ($5.6 million) and security. Investing in technology would
    enable the Library to re-engineer its major business process and
    improve productivity. The new system would also improve collections
    security. The Library is requesting $685,035 to hire additional police
    officers and to fund various contract security initiatives. Additional
    security funds are needed to handle the reopening of the Jefferson
    building including staffing new police posts and installing security
    equipment. Further, additional security funds are requested for two
    reader registration stations ($393,410) and for inserting detection
    targets into items received by the Copyright Office ($242,072).
                                ils installation
        Question. How many FTE's will be saved once ILS is completely
    installed?
        Answer. The Library expects that current staffing levels will be
    maintained through the year 2000, which will be the first year in which
    the Integrated Library System (ILS) will have been fully implemented.
    Major efficiencies will begin to be realized in 2001. During the first
    few years we will need all existing staff to get the ILS up and
    running.
        From 2001-2005, the workforce is anticipated to be reduced
    significantly through attrition. Therefore, once the ILS has been
    installed and staff have been trained, we will need to reallocate the
    majority of the positions eliminated by the ILS to a variety of
    critical tasks that have long been understaffed, such as arrearage
    reduction, collections inventory, and security.
        Our initial estimates indicate 120 FTE could be reinvested in
    crucial areas for arrearage reduction, collection security, and
    inventory control when the ILS is completely installed and fully
    operational by year 4 (2003). It must be emphasized that these
    projections are very preliminary. Until the ILS has been chosen and
    installed and staff have become familiar with the capabilities of the
    new system--a prerequisite for the redesign of many Library Services'
    business processes--the projections will remain rough estimates.
                                 loc collection
        Question. Would it be helpful for the Library to receive its
    collection in both a hard copy and in digital form?
        Answer. At present, the Library is working from the hypothesis that
    some kinds of works should be deposited in hard copy only, some in
    digital form only, and some in both formats. Currently when a work is
    published in CD-ROM format and hard copy, copyright regulations require
    that the CD-ROM version be deposited. However, it is most often the
    case that the CD-ROM and hard copy editions of a work are sufficiently
    different from each other that they must be registered and deposited
    separately.
        A new Copyright Office initiative--CORDS (Copyright Office
    Electronic Registration, Recordation and Deposit System)--that will
    become operational in 1998 will allow digital works to be submitted
    through the Internet using public key/private encryption technology.
    The system is in a test phase with Carnegie Mellon, Stanford University
    and MIT Press as participants. In 1998 the types of works that will be
    submitted electronically are technical reports, electronic journals and
    newsletters, books, dissertations, and home pages and websites. From
    1999-2004 the Copyright Office will systematically incorporate
    additional categories of materials, working closely with CRS and
    Library reading room staff to determine which formats best serve user
    needs. If we determine that we need both hard copy and digital versions
    of identical works, the Copyright Office has authority under Title 17
    to amend its deposit regulations to require deposit of one copy of each
    edition. The Law Library under its Global Legal Information Network
    (GLIN) Project is currently receiving both a hard copy and a digitized
    format of some countries' official gazettes. This procedure will
    continue until preservation standards are established to replace hard
    copies completely. The ultimate goal is to acquire only a digitized
    format for primary sources of laws.
                          management improvement plan
        Question. According to the MIP, the Library's Executive Committee
    was to review on March 2, 1997 its previous decision not to establish a
    Chief Information Officer position to provide leadership in technology
    across the organization. What did the Executive Committee decide?
        Answer. The Library's Executive Committee has deferred its decision
    on establishing a Chief Information Officer position.
        Question. Which senior Library official will have oversight
    responsibility for the purchase and implementation of the Integrated
    Library System (ILS), if approved by Congress, which the Library
    estimates will cost more than $40 million and require training of more
    than half the Library's staff?
        Answer. If funds are appropriated by the Congress for the purchase
    and implementation of the Integrated Library System, Deputy Librarian
    Donald Scott will serve as the source selection authority for the ILS
    procurement. Barbara Tillett will serve as ILS project manager.
                        streamlined management processes
        Question. Who are the members of the Executive Committee and the
    Senior Management Reporting Group, and what are their separate roles
    and responsibilities?
        Answer. The Library's Executive Committee (EC) is the primary
    decision- and policy-making body for the institution. Its members are
    responsible for the achievement of the Library's mission and its
    priority work. The EC is also responsible for assuring that all key
    issues are identified and addressed in a timely fashion. The head of
    each of the Library's seven service units serves on the EC. When there
    is lack of consensus on an issue, the committee presents options and
    viewpoints to the Librarian or the Deputy Librarian for his decision.
        Members of the Executive Committee are as follows:
          James H. Billington, Librarian of Congress
          Donald L. Scott, Deputy Librarian of Congress (chair)
          Jo Ann Jenkins, Chief of Staff/Senior Advisor for Diversity
          Rubens Medina, Law Librarian
          Daniel P. Mulhollan, Director, Congressional Research Service
        Marybeth Peters, Register of Copyright/Associate Librarian for
                Copyright Services
          Winston Tabb, Associate Librarian for Library Services
        The following directors of the primary service functions within the
    institution rotate serving as the infrastructure representative at
    Executive Committee meetings. They are considered voting members in
    terms of decision-making.
          Herbert Becker, Director, Information Technology Services
          Kenneth Lopez, Director of Security
          Lloyd Pauls, Associate Librarian for Human Resources Services
          Linda Washington, Director, Integrated Support Services
          John Webster, Director, Financial Services
        The Senior Management Reporting Group (SMRG), consisting of the
    primary senior level managers, is the main managerial mechanism for
    imparting critical information within the institution. The group's
    weekly meetings are the forum in which the Executive Committee
    communicates decisions, goals, and assignments. SMRG members are
    responsible for sharing information on their individual areas of
    responsibility, as well as bringing forward issues requiring
    deliberation, coordination, or other action; congressional concerns are
    given particular priority.
        Members of the SMRG are as follows:
          James H. Billington, Librarian of Congress
          Donald L. Scott, Deputy Librarian of Congress (chair)
          Herbert S. Becker, Director, Information Technology Services
          Peter Braestrup, Senior Editor and Director of Communications
          Jill D. Brett, Public Affairs Officer
          Jo Ann Jenkins, Chief of Staff
          Lana Jones, Acting General Counsel
          Kenneth Lopez, Director of Security
          Rubens Medina, Law Librarian of Congress
          Daniel P. Mulhollan, Director, Congressional Research Service
          Geraldine M. Otremba, Director, Congressional Relations Office
          Lloyd Pauls, Associate Librarian for Human Resources Services
        Marybeth Peters, Register of Copyrights/Associate Librarian for
                Copyright Services
          John W. Rensbarger, Inspector General
          Winston Tabb, Associate Librarian for Library Services
          Linda J. Washington, Director, Integrated Support Services
          John D. Webster, Director, Financial Services
          Andre Carl Whisenton, Director, Dispute Resolution Center
          Harry Yee, Chief, Labor Management Relations Office
                              building compliance
        Question. In February before the House Legislative Branch
    Appropriations subcommittee, the Office of Compliance testified that
    there were conformance problems, particularly electrical safety issues,
    with the Library buildings. At the time, no estimates had been prepared
    on the cost to bring the buildings into compliance. What has the
    Library done to address the compliance problems? Have any cost
    estimates been prepared? Will this impact the Library's fiscal year
    1998 budget?
        Answer. Electrical safety problems identified in Library of
    Congress Buildings by the General Counsel, Office of Compliance, report
    of June 28, 1996, ``Report on Initial Inspections of Facilities for
    Compliance With Occupational Safety and Health Standards Under Section
    215,'' are not the responsibility of the Library.
        All electrical safety problems identified were in spaces under the
    control of the Architect of the Capitol (AOC). These spaces included
    mechanical equipment rooms, elevator equipment rooms, AOC shops, etc.
    Consequently, the Library has made no cost estimates for correction of
    the problems. Since this area of action falls under the jurisdiction of
    the AOC, there will be no impact on the Library's fiscal year 1998
    budget.
                        congressional accountability act
        Question. At the time of the 1997 Senate appropriations hearing,
    the Office of Compliance was preparing a study regarding the
    comprehensiveness and effectiveness of various laws affecting the
    Library of Congress as well as other legislative branch agencies. What
    was the outcome of the study?
        Answer. The study, presented to the Congress on December 31, 1996,
    did not make any recommendations, stating that any recommendations this
    early in the life of the implementation of the Act would be
    ``premature.'' Rather, the study describes how the legislative branch
    entities enforce the rights and protections under the statutes they
    studied and concluded that, ``* * * overall, the rights, protections,
    procedures and relief afforded to employees at the GAO, the GPO and the
    Library * * * are, in general, comprehensive and effective when
    compared to those afforded other legislative branch employees covered
    under the [Congressional Accountability Act].''
        While not offering legislative remedies, the study did note some
    areas where there are discrepancies between the letter and spirit of
    the CAA and the administration of workplace-related laws at the
    Library. The study made several references to the fact that Library of
    Congress employees, uniquely within the federal government, have no
    appeal to an administrative body independent from, and external to, the
    head of the agency, with respect to fair employment and other claims.
        In the absence of a legislative proposal from the Office of
    Compliance, the Library will be seeking needed legislative changes
    through its authorizing committees. These changes include: (1) creation
    of an avenue to seek administrative relief in fair employment cases
    through the Office of Compliance, as noted above; (2) technical changes
    needed in the implementation by the Library of the Family and Medical
    Leave Act; (3) placing the Library under the Americans with
    Disabilities Act-public access procedures outlined for the Capitol
    complex under the CAA; and (4) placing the Library under the labor-
    management relations provisions of the CAA.
                                financial audit
        Question. At the Senate Rules Committee hearing on March 20, 1997,
    Dr. Billington stated that KPMG had been contracted to do the Library's
    external audit and the audit report was due at the end of March. The
    Library has been given a final copy of the report. Do you concur with
    the findings? Please summarize them and provide the Committee with a
    copy of the final report when it is completed.
        Answer. The Library's consolidated financial statement report for
    fiscal 1996 was issued on April 30, 1997, and a copy was sent to the
    Committee. The independent accounting firm, KPMG Peat Marwick, gave the
    Library an unqualified ``clean'' opinion on the financial statements
    and made 43 recommendations for improvements. The Library concurs with
    38 and partially concurs with 5.
        The 43 recommendations address the one material internal control
    weakness and seven reportable internal control conditions found by the
    auditors. Most of the recommendations relate to conditions found during
    the 1995 audit that require more time to implement. For example, eleven
    out of the 43 recommendations (26 percent) pertain to improving the
    safeguarding of the Library's collections--a long-term task. The one
    material internal control weakness addresses the security practices
    over information technology systems. The Library has already taken
    steps to improve these security practices (e.g., requiring that the
    Computer Security Officer sign off on the separation clearance forms),
    and the Library is taking additional steps to implement the
    recommendations.
        The 1996 audit found two new reportable internal control
    conditions--year 2000 compliant software changes were needed and that
    the Inspector General's oversight functions were limited. The Library
    is taking steps to address both of these findings.
        Consistent with the 1995 audit report, the 1996 audit report again
    found that the Library had two areas of noncompliance with laws and
    regulations--operating gift revolving funds beyond the scope of
    authority and retaining certain money from the Cooperative Acquisition
    Program. The Library continues to request legislation to correct both
    of these issues.
        In summary, the 1996 audit report represents a major achievement
    for the Library as a result of receiving a ``clean'' opinion on the
    financial statements, but it also reiterates that more work is needed
    to address all of the Library's internal control issues.
                          management improvement plan
        Question. According to the Library's Management Improvement Plan
    (MIP), the Executive Committee has had under consideration since June
    1996 the elevation of a Chief Financial Officer's position to focus
    attention on improving the Library's financial systems and controls.
    When does the Executive Committee expect to make a decision on this
    Booz Allen recommendation?
        Answer. The Director of Financial Services is the Library's Chief
    Financial Officer responsible for budget, accounting, financial
    systems, and disbursing activities. As evidenced by the unqualified
    audit opinion on our fiscal 1996 financial statements, the Library has
    improved its financial systems and controls.
                               library technology
        Question. When was the ILS Request for Comment issued? What is the
    closing date?
        Answer. The Request for Comment (RFC) was issued by the Library on
    December 3, 1996. The 60-day comment period ended on February 3, 1997.
    All nine vendors who responded to the RFC indicated their intent to
    respond to the Request for Proposal.
        Question. What is the estimated cost of staff training for the ILS?
    Is it included in the $24,030,000 of earmarked existing resources? If
    not, does the Library expect to commit other existing resources to
    cover training costs?
        Answer. The estimated cost of staff training related to the ILS is
    $5,939,605. All of these costs are included in the $24,030,000 figure
    with the exception of $64,992, which is requested for fiscal year 1999
    to pay the selected vendor to ``train the trainers.''
                         unprocessed library arrearages
        Question. From 1992 to 1997 the arrearages were reduced by 43.71
    percent. What is the projected date for eliminating the remaining
    arrearages?
        Answer. If current staffing levels remain steady, the Library plans
    to (1) eliminate the print and map arrearages by December 2000 and (2)
    reduce the remaining arrearages 80 percent by December 2005.
                      systematic training and development
        Question. According to the Booz-Allen management review, their
    assessment of training and development capability revealed a strong
    need for leadership-management training for all three levels of
    management.
        When do you estimate training in leadership and management
    developed under the approved continuum concept will begin for: (1)
    first-line managers; (2) middle management; and (3) senior management?
        Answer. We have just concluded a comprehensive three-day
    Facilitative Leadership Training Program for all Library managers and
    supervisors. The program was designed to enhance management skills and
    abilities, particularly those which help build more productive
    relationships and achieve more focused results.
                           accountability mechanisms
        Question. To ensure standard applications of the performance
    appraisal across the Library, an audit is now being conducted of the
    performance appraisal process for bargaining unit employees. The
    objective is to make certain they are being conducted in accordance
    with applicable collective bargaining agreements.
        What is the estimated completion date of the audit? Please provide
    the Committee with the findings of the completed audit.
        Answer. We expect to complete the audit no later than December 31,
    1997, and we will provide the Committee with a report of our audit
    findings.
                support functions' efficiency and responsiveness
        Question. As a way of developing increased communications between
    labor and management, the Library facilitated a meeting held with the
    Executive Committee, Chief of Labor Relations, ALHR, three union
    presidents, and two FLRA representatives. Tentative agreements
    subsequently were reached with unions on final regulations implementing
    the Americans with Disabilities Act, the Family Medical Leave Act, and
    the Family Friendly Leave Act. In addition, they reached an agreement
    on new fitness for duty procedures for bargaining unit staff.
        Have the tentative agreements since been finalized? If so, have
    they been implemented? Has the agreement on fitness for duty procedures
    been implemented? If not, what is the estimated date for
    implementation?
        Answer. Bargaining has been completed and new Library regulations
    issued implementing Americans with Disabilities Act, Family Medical
    Leave Act, and Family Friendly Leave Act. In addition, bargaining has
    been completed on new fitness-for-duty medical examination procedures,
    and the new regulation will be issued shortly.
                             accident compensation
        Question. Included in the 1998 budget request (Salaries--
    Mandatory--Accident Compensation) are funds to cover $1,034,867 in
    accident compensation for 1996. The Library's FTE level for that year
    was 4,114. What was the cost of the Library's accident compensation for
    each fiscal year 1992 through fiscal year 1996?
        Answer. The cost of the Library's accident compensation for fiscal
    year 1992 through fiscal year 1996 was as follows:

    Fiscal year:
        1992......................................................  $889,219
        1993...................................................... 1,012,541
        1994...................................................... 1,030,782
        1995......................................................   940,521
        1996...................................................... 1,034,867

        Question. What is the norm for an agency with a staff level of
    approximately 4,000?
        Answer. We consulted with the Department of Labor to determine the
    norm for an agency with a staff level of approximately 4,000. Their
    closest comparative figure was the Small Business Administration which
    had an fiscal year 1996 accident compensation cost of $2,500,000 for a
    staff of 4,800.
                                security report
        Question. Computer Sciences Corporation issued its report assessing
    the physical security of the Library of Congress on August 25, 1995. In
    Dr. Billington's March 20, 1997, statement for the Senate Rules
    Committee hearing, he states that the Library Security Management Plan
    is in place. Does it incorporate all the recommendations of the
    Computer Sciences Corporation report? If not, which ones are not
    included and why?
        Answer. Regarding the recommendations of the Computer Sciences
    Corporation (CSC) report, the following is noted:
      --The Security Management Plan was not intended to incorporate all
            the recommendations of the CSC report.
      --The majority of the over 800 CSC recommendations are being tracked
            separately from the Plan.
      --Tracking the implementation of CSC report recommendations is best
            accomplished by a separate process due to the detailed and/or
            technical nature of the many recommendations.
      --Only those CSC report recommendations dealing with broad security
            program management matters such as structure and policy are
            included in the Plan.
        The new Director of Security, who joined the Library this past
    February, has reviewed the Security Management Plan and is in the
    process of adding enhancements. The Plan will be continuously updated
    to reflect changes in threat conditions, risk factors and security
    technology.
                          management improvement plan
        Question. Security of People, Facilities, Collections, and Data
    Systems. March 31, 1997 is the estimated completion date for the risk
    assessment for the Library collections using reports from Computer
    Sciences Corporation and other consultants, plus broad input from
    within the Library. Is it completed? Please provide the Committee with
    a copy of the report.
        Answer. The risk assessment for the Library collections is not
    completed. Library Services, with the assistance provided by the firm
    of KPMG Peat Marwick, is leading an Internal Control Review Task Force
    with the charge of preparing a risk assessment of the Library's
    collections. The March 31, 1997, estimated completion date shown in the
    Library's Management Improvement Plan, underestimated the work required
    to prepare a comprehensive risk assessment. The risk assessment, when
    completed, will be comprised of a series of individual assessments
    covering the major collections divisions. Preparation of the
    collections risk assessment is expected to extend beyond this year
    because it is a complex and time consuming undertaking. The task force
    is focusing initially on completing a risk assessment for one division,
    Geography and Map (G&M). Once the task force has completed the G&M
    model, estimated to be by July 31, 1997, other collections divisions
    will prepare their respective risk assessments. Risk assessment results
    will be incorporated into the Library's Security Management Plan.
                                library security
        Question. As referenced earlier, in fiscal year 1996, the Library
    contracted with Computer Sciences Corporation to conduct a
    comprehensive survey of collections security and police operations. As
    part of its findings, the report indicated that Library police are
    currently understaffed. The Library's goal is to reduce police overtime
    (roughly 25 percent of total scheduled hours) to 10 percent of total
    scheduled hours. Funds to achieve the goal are included in the
    Library's 1998 budget request. What is the Capitol Police's percentage
    of overtime and what do they consider an acceptable norm.
        Answer. From discussions with the Capitol Police it was determined
    that their percentage of overtime approximates the Library's overtime
    goal of 10 percent of total scheduled hours which they consider an
    acceptable norm.
                           revolving fund legislation
        Question. With regard to the finding of the GAO General Counsel
    concerning the Cooperative Acquisition Program, Dr. Billington recently
    notified the Committee that: ``Absent proper statutory authorization to
    operate the program under a revolving fund, the Library must
    reluctantly cease operating the Cooperative Acquisitions Program by
    October 1, 1997.''
        This Committee recently approved the reprogramming of funds to
    temporarily keep alive this program. What is the current status of your
    legislative proposal?
        Answer. The Library submitted draft legislation to Senate Rules and
    House Oversight; Senate Rules held an oversight hearing in March and
    the Library was asked to submit additional information. House Oversight
    also has the draft and we have met with staff counsel to discuss it but
    no action is scheduled at this time.
                                  crs workload
        Question. A comparison of the Library's fiscal year 1997 and fiscal
    year 1998 Budget Requests shows the following regarding Workload
    Statistics for CRS Requests and Services Provided Congress:

    ----------------------------------------------------------------------------------------------------------------
                                                                                 Fiscal year--
                                                         -----------------------------------------------------------
                 Fiscal year budget request                                                                  1996
                                                             1992        1993        1994        1995      estimate/
                                                            actual      actual      actual      actual      actual
    ----------------------------------------------------------------------------------------------------------------
    1997................................................     644,668     615,913     593,000     592,731  \1\ 593,00
                                                                                                                   0
    1998................................................     645,000     607,000     536,000     492,000     487,000
    Variance (1998-97)..................................        +332      -8,913     -57,000    -100,731    -106,000
    ----------------------------------------------------------------------------------------------------------------
    \1\ Estimate.

        Why are there variances in actual workload statistics for fiscal
    years 1992 through 1995?
        Answer. For fiscal year 1992 the difference in numbers reported
    results from rounding. For fiscal years 1993-1996, workload statistics
    previously reported in the fiscal 1997 request were revised to exclude
    some data on client use of automated services. CRS recently discovered
    a programming error in capturing Internet electronic access for House
    offices and committees, and the decision was made to exclude these
    questionable data from reported workload. Therefore, statistics from
    1993 through 1996 were revised to eliminate the questionable data.
    Statistics for access to files via modem or hard-wired terminals in the
    House, and all access from the Senate were found to be valid. The
    client access data now include only Senate and House access of SCORPIO
    databases via modem, Senate Internet access, and calls to the CRS Stats
    Line.
        Fiscal 1996 data do include initial client access to the CRS
    Homepage on the World-Wide Web. This method of counting access is
    extremely conservative, as it does not record retrieval of documents or
    complex and lengthy searches. We are continuing to evaluate how we
    should count electronic services, which is an increasing method of
    delivering our products to congressional clients, and will very likely
    revise the methodology as we gain more experience with the new delivery
    electronic delivery systems.
        Question. Based on the fiscal year 1998 budget request, for fiscal
    year 1992 through fiscal year 1996 there was a cumulative reduction of
    -24.49 percent in CRS Requests and Services Provided Congress. What is
    the basis for the projected increase of 13,000 in fiscal year 1997?
        Answer. The projection was made last fall, before the legislative
    agenda and timetable for the 105th Congress was known. CRS projected a
    slight increase based on historical experience which shows that in some
    past Congresses, the first session workload for research and analysis
    requests was higher than in the second session.
        At this time we are tentatively projecting a fiscal year total of
    between 485,000 and 495,000. This guesstimate is based on data trends
    for the 105th through the end of March, coupled with actual experience
    during the last quarter of the 104th 2d session. Actual numbers will
    vary if the legislative agenda changes significantly as a result of
    national or world events.
        Question. Mr. Mulhollan's statement before the House appropriations
    hearing on February 12, 1997, included the following: ``With the
    overall reduction of CRS, committee staff, and staff of other
    legislative branch resources, we developed a strategy to respond to
    these losses and ensure that we avoid unnecessary duplication of effort
    with the committees and legislative branch support offices. We
    formulated and implemented a decision-making process within CRS for
    resource allocation which ensures that we continue to devote our
    resources to the highest priority work that supports the legislative
    needs of the Congress.'' When was the new process implemented? Are
    there plans to evaluate its effectiveness? If so, please describe, and
    include a time table.
        Answer. The purpose of the new resource allocation process, which
    was initially implemented in fiscal 1996 and revised in January 1997,
    is to assure that hiring, reassignment, and detail, and other resource
    allocation decisions are made in the context of the legislative agenda
    and Service-wide needs.
        CRS managers use a standard format when requesting additional staff
    or consultant services, and address specific criteria including an
    assessment of (1) the division and Service-wide capacity to support the
    legislative agenda in the subject area; (2) measures the division has
    already taken to address the need; (3) whether staff could be
    reassigned within the division or from elsewhere in the Service to meet
    the workload needs; (4) the impact of any projected retirements on
    research capacity; (5) appropriate scope of recruitment; (6) the impact
    on diversity and upward mobility objectives; (7) infrastructure
    requirements; (8) whether the need is most appropriately met through
    staffing or through consultant services; and (9) the short and long
    term budget impacts of the request. Decisions are made by the Director
    after periodic submissions--expected to be quarterly--and after
    discussion in the Research Policy Council, which consists of the
    Director, the Deputy Director, the Associate Directors and the Division
    Chiefs.
        The resource allocation process also included an examination of the
    distribution of non-personal resources, particularly database and print
    subscriptions. The Research Policy Council agreed on a simplified
    process and appropriate factors for making division and office
    suballotments at the beginning of each fiscal year. The process
    provides mechanisms to reduce or increase division allocations as needs
    arise.
        Evaluation of the process is ongoing; with each use, the Research
    Policy Council improves information gathering and changes are made
    accordingly.
                                 crs personnel
        Question. CRS is requesting funds to hire 60 additional FTE's over
    the next three years (25 in fiscal year 1998, 25 in 1999, and 10 in
    fiscal year 2000). During the subsequent six years they plan to return
    to their current service level of 747 FTE's. At the February 12, 1997,
    House appropriations hearing, Dr. Billington stated that the Library
    had a very low turnover rate--about 3.7 annual rate for several years.
        For each fiscal year from 1992 through 1996, what percentage of CRS
    staff was eligible to retire? For each of those years, what percentage
    of those eligible did retire?
        Answer.

    ------------------------------------------------------------------------
                                                                Percent of
                                                Percent of      retirement
                                                 permanent     eligibles who
                                              staff eligible  retired during
                                               to retire (as   the year (as
                                                 of 9/30)        of 9/30)
    ------------------------------------------------------------------------
    1992....................................             5.6             4.7
    1993....................................             9.2             4.4
    1994 \1\................................            10.9            31.2
    1995....................................            10.3             5.6
    1996....................................            11.1            10.5
    ------------------------------------------------------------------------
    \1\ Retirement incentives of up to $25,000 were offered during fiscal
      1994.

        Question. CRS has conducted a survey to determine the planned
    retirements of eligible CRS staff in future years. According to the
    survey results, for each fiscal year from 1997 through 2000, what
    percentage of eligible CRS staff plan to retire?
        Answer. The retirement survey asked CRS staff, on a voluntary
    basis, to estimate, as accurately as possible, retirement plans based
    on current expectations. Each staff member who would be eligible to
    retire through 2006 was asked to identify the time interval (a two-year
    span) most likely to correspond with current retirement plans. Nearly
    93 percent of staff eligible to retire by 2006 responded to the survey.
    The raw results are provided below. We are now assessing the impact of
    these retirements on the overall capacity of the Service to maintain
    analytic expertise in the areas we believe critical to serving Members
    and committees in the coming years.

    ----------------------------------------------------------------------------------------------------------------
                                                                           Total        Percent of      Percent of
                                                                        retirements   eligible staff  eligible staff
                                                                       projected by      likely to       likely to
            Time period considered most likely for retirement         staff (through  retire in each  retire in each
                                                                        survey) for     time period     time period
                                                                        time period   (year by year)   (cumulative)
    ----------------------------------------------------------------------------------------------------------------
    1997-1998.......................................................              21             5.5             5.5
    1999-2000.......................................................              36             9.4            14.9
    2001-2002.......................................................              41            11.0            25.9
    2003-2004.......................................................              50            13.1            39.0
    2005-2006.......................................................              90            22.8            61.8
    2007 and beyond.................................................             116            31.1            92.9
                                                                     -----------------------------------------------
          Subtotal..................................................             354            92.9  ..............
    No Response.....................................................              27             7.1  ..............
                                                                     -----------------------------------------------
          Total.....................................................             381             100  ..............
    ----------------------------------------------------------------------------------------------------------------

                              federal-state shifts
        Question. During the 1997 Senate appropriations hearing, the
    Library made reference to increasing congressional needs for research
    and analysis regarding state and local government developments as the
    Congress considers shifting responsibilities for many programs and
    policies from the federal government to the state level. Has there been
    an increase in requests from senatorial offices regarding the impact of
    the Personal Responsibility and Work Opportunity Reconciliation Act of
    1996 (Public Law 104-193) on state and local governments? If so, how
    significant? Please provide a general description of the types of
    information CRS has developed to respond to this need.
        Answer. We are now developing the capacity to analyze requests on
    specific issues, but cannot yet do so. Therefore, we do not currently
    have data on the actual number of requests by Senate offices for the
    specific issues associated with this legislation. However, we do have
    distribution data to the whole Congress for the reports we have
    prepared on these issues, which are elaborated below. Since August 1996
    CRS provided 7,041 copies of these reports to congressional clients
    through the Product Distribution Center.
        To answer congressional inquiries on the new federal-state funding
    and policy relationships and on state-specific information, we have
    developed a number of products on the issues associated with the
    Personal Responsibility and Work Opportunity Reconciliation Act of
    1996. At an overview level, we prepared a report which summarizes state
    Temporary Assistance for Needy Families (TANF) programs--CRS Report 97-
    380 (Welfare reform: State Programs Under the Block Grant for Temporary
    Assistance for Needy Families).
        To answer questions about the new state block grant TANF, the CRS
    welfare team developed an integrated data base about state TANF plans
    and pre-TANF reforms that states are continuing under waivers. The
    plans show that some states are delegating more authority to local
    units of government. The data base enables us to provide details about
    more than 70 elements of TANF programs, state by state.
        In addition, specific reports provide information about aspects of
    the reform law, such as Alien Eligibility for Benefits Under the New
    Welfare and Immigration Law (CRS Report 96-617), the provisions
    affecting Native Americans, Indian Tribes and the New Welfare Law (CRS
    Report 97-86), Child Care for Low-Income Families: Federal Programs and
    Welfare Reform (CRS Report 96-780), and New Welfare Reform and
    Subsidized Public Sector Jobs (CRS Report 97-360).
        To answer questions about state funding, we have compiled data
    comparing TANF grants and child care funding with funds provided under
    old law, state-by-state. This has included projections of some
    supplemental TANF funds for states with above-average population growth
    and below-average federal funding per poor person. A memorandum
    entitled Grants to the States for Temporary Assistance for Needy
    Families and Child Care provides state-by-state funding levels under
    the new TANF and child care block grants.
        An issue brief--Welfare Reform (IB93034) analyzes continuing
    issues, such as proposals to continue benefits for legal immigrants
    here when the law was enacted, the dispute over application of federal
    (and state) labor laws to welfare recipients in ``workfare'' programs;
    whether generous work exemption provisions of existing state waivers
    can override TANF's work participation rules; what state spending will
    count toward the requirement that state maintain 75 percent of their
    historic spending level; the authority for states to administer TANF
    through private, religious or charitable organizations; the President's
    budget proposals related to the new law (extra spending of $22.5
    billion over 5 years), and what role, if any, the federal government
    should play in creating and/or subsidizing jobs for TANF recipients.
        A number of reports have been written to (1) provide a side-by-side
    comparison of TANF with the replaced programs of Aid to Families with
    Dependent Children (AFDC) and Job Opportunities and Basic Skills
    Training (JOBS) (New Welfare Law: Comparison of the New Block Grant
    Program with Aid to Families With Dependent Children, CRS Report 96-
    720); (2) summarize the omnibus welfare law (New Welfare Law: the
    Personal Responsibility and Work Opportunity Reconciliation Act of
    1996, CRS Report 96-687); (3) describe new SSI rules for children
    (Supplemental Security Income (SSI) for Children: New Rules, CRS Report
    97-340), (4) discuss Child Support Enforcement: New Reforms and
    Potential Issues (CRS Report 97-408), and (5) present new AFDC program
    rules (Aid to Families With Dependent Children (AFDC): Program Benefit
    Rules, July 1, 1996 CRS Report 97-188).
                        copyright office processing time
        Question. In fiscal 1996, the processing time went from nine weeks
    to 14 weeks. What was the percentage of staff reduction for fiscal
    1996?
        Answer. The number of staff in fiscal year 1996 declined 1.1
    percent from 506 to 500, continuing the loss of trained professionals.
    Since the end of fiscal 1996, processing time for the bulk of routine
    claims has claimed steadily to 18 weeks before a certificate is issued.
    CORDS will enable the Copyright Office to process claims with far fewer
    staff. However, in fiscal 1998 the percentage of CORDS claims will be
    very low, and the savings will not be apparent until fiscal 2000. In
    the meantime the Office will need the additional FTE's to hire
    examiners and catalogers lost over the past few years to restore
    processing time to acceptable levels.
                    copyright office retirement eligibility
        Question. What is the Copyright Office staff retirement eligibility
    rate for 1997 and 1998? Please provide similar retirement eligibility
    data for the Copyright Office that you did for the CRS.
        Answer. The eligibility rate in fiscal 1997 is 9 percent and 11
    percent in fiscal 1998. The Chart shows the cumulative eligibility rate
    through the year 2006, with a total eligibility of 42 percent.
                                copyright cords
        Question. Contingent on (1) enactment of legislation that permits
    the setting of higher fees; and (2) increased processing of claims
    under the CORDS system, when do you estimate the Copyright Office could
    reduce its fiscal year 1998 request for 502 FTE's and by how much?
        Answer. Legislation that would permit the Copyright Office to set
    higher fees has passed the House and is now before the Senate. Once
    enacted, the legislation will require the Office to conduct a study
    followed by administrative hearings to establish a new fee schedule
    consistent with the objectives of the U.S. copyright system. Then
    Congress has a 120-day period in which to disapprove the recommended
    fee schedule. Therefore, we do not believe a fee increase could be
    implemented before fiscal 1999. A fee increase could permit a reduction
    in the net appropriation, but reduction in staff would only occur if
    the workload declined.
        CORDS will not enable the Office to reduce the 502 FTE's requested
    in fiscal 1998. However, CORDS will enable the Office to avoid future
    increases in staff costs by accommodating an increasing workload and by
    processing claims more efficiently and in less time without adding as
    many new FTE's. We estimate that the workload will increase to 635,000
    by the year 2000, of which 50,000 will be processed under CORDS, while
    the remaining 585,000 would still have to be processed using current
    manual procedures.
                          management improvement plan
        Question. In June 1996 the Library issued a Management Improvement
    Plan (MIP-96) which was aimed at addressing many of the findings and
    recommendations contained in the Booz-Allen and Price Waterhouse
    reviews. It also included items related to the findings of the report
    by the Computer Sciences Corporation regarding physical security of the
    Library. An updated plan (MIP-97) was issued in February 1997.
        MIP-97.--Sec. 1 Updated Library Plans and Programs Phase II of the
    development of a Strategic Plan calls for the service units to identify
    the key tasks necessary to accomplish the goals and identify
    performance indicators, responsible authorities, resource requirements
    and time frames needed for completion of each objective. The target
    completion date for Phase II was March 31, 1997.
        Is Phase II of the Strategic Plan completed? Please provide the
    Committee with a copy of the completed Phase II report.
        Answer. The first draft of Phase II has been completed. At the
    present, the areas of Library that constitute the infrastructure (Human
    Resources, Financial Services, Integrated Support Services, and
    Information Technology Services) are modifying their own operational
    plans in order to support the infrastructure needs of the service
    units. Phase II will be finalized after the strategic planning
    committee reviews all the plans and prioritizes the enabling
    infrastructure's action items based on the available resources. We
    anticipate this action to be complete by the end of this fiscal year.

                        additional submitted statements

        [Clerk's note.--The subcommittee has received statements
    from the Association of Research Libraries and the American
    Association of Law Libraries which will be inserted in the
    record at this point.]
        [The statements follow:]
          Prepared Statement of the Association of Research Libraries
        On behalf of the Association of Research Libraries, the American
    Library Association, the American Association of Law Libraries and the
    Special Libraries Association, we urge the Subcommittee to support the
    fiscal year 1998 budget request of the Library of Congress.
        Last year, in landmark telecommunications legislation, Congress
    recognized that libraries are primary points of access for the public
    to participate in the information age. Libraries and librarians have
    embraced this challenge with enthusiasm. Since many Federal Depository
    Libraries are housed in academic and public libraries and libraries of
    all types that utilize the resources of the Library of Congress, some
    statistics regarding connections to the World Wide Web (WWW) are
    important. In academic institutions: 83 percent of doctorate granting
    institutions provide access to the World Wide Web; 67 percent of
    Master's degree granting institutions provide access to WWW; and it is
    important to note that access to the Internet outside the Library in
    these institutions is extremely high, 95 percent and 76 percent
    respectively. 44.4 percent of public libraries in the United States
    were connected to the Internet in 1996 and it is anticipated that 60
    percent will be connected by the end of 1997. Although only 23.7
    percent of public libraries offer full WWW access to the public, the
    discounted rates now being implemented by the Federal Communications
    Commission are expected to increase this percentage rapidly. All of
    these efforts are undertaken with an appreciation of the importance of
    ensuring citizens with access to needed information resources as well
    as necessary skills to fully participate in the information age.
        The Library of Congress has invested in many technological efforts
    to promote access to a diverse array of information resources to the
    public throughout the United States. Programs and activities such as
    the Library's digitized American Memory collections, the National
    Library for the Blind and Physically Handicapped, those relating to
    preservation and cataloging, and electronic information services such
    as the Global Legal Information Network (GLIN), all serve
    constituencies throughout the Nation. These and other programs of the
    Library merit the Subcommittee's continued support.
        For the last several years, there has been a rather significant
    transformation in how information is created, managed, used, accessed,
    and preserved. Libraries are at the forefront of this change and it has
    required and will continue to require, investments in infrastructure--
    technological and human resources. The Library of Congress fiscal year
    1998 budget request of $387.6 million (including the authority to
    obligate $30.4 million in receipts) positions the Library to realize
    the benefits of the digital networked environment while ensuring that
    important programs and services are maintained. This request would fund
    mandatory increases, provide the necessary continuity for many
    programs, and target selected strategic technological activities such
    as the Integrated Library System (ILS) and the Global Legal Information
    Network (GLIN).
        Five LC programs are the focus of our interests: Services for the
    Blind and Physically Handicapped; Electronic Initiatives; American
    Folklife Center; Arrearage Reduction and Cooperative Cataloging; and
    Collection Security.
    National Library Service for the Blind and Physically Handicapped
        The National Library Service for the Blind and Physically
    Handicapped (NLS) is a critically important service to the Nation. This
    national library service provides recorded and Braille materials to
    777,000 blind and physically handicapped persons and is accomplished
    via a cooperative network of 142 regional, subregional libraries
    (state, regional, and public libraries throughout the nation) and two
    multi-state centers that circulate these resources to eligible
    borrowers by postage-free mail. Some 23 million items are borrowed
    annually. The network of libraries also serves as distribution points
    for specialized playback equipment and accessories. We support the
    request for $2.5 million for the purchase of cassette book machines to
    ensure the availability of these machines for the blind and physically
    handicapped individuals.
    Electronic Initiatives
        There has been progress in achieving the goal of building a
    networked-based, distributed program of access to library collections
    throughout the country, and indeed the world. Recent investments in
    digital initiatives indicate the need for: many years of sustained
    support with a particular focus on technological, economic, and human
    resource issues; changes in how libraries select and collect resources,
    and how these collections are managed; and greater understanding of how
    users access these resources.
    Integrated Library System
        Since the late 1970's, research libraries have invested in systems
    which permit the integrated processing of records. Such systems or
    integrated library system(s) (ILS), are in fact, fundamental building
    blocks of digital libraries and electronic initiatives in libraries
    throughout the United States. Research libraries have instituted such
    systems to achieve greater efficiencies and productivity and
    importantly, to better serve the user community. An ILS can integrate
    key library functions including acquisitions, cataloging, inventory
    control, serials management, circulation, binding and preservation,
    searching of the library's holdings, management statistics, and more.
    The experience of Yale University Library is illustrative of the
    efficiencies gained in research libraries through the adoption of more
    effective automated systems. The Yale University Library realized a 70
    percent increase in cataloging throughput per full time equivalent
    (FTE) over the past 10 years, from 762 to 1,325 titles per FTE per
    year.
        The Library's request for $6.1 million for automation projects
    would include first year funding for an ILS, the Global Legal
    Information Network (GLIN), and more. This request does not reflect the
    necessary reprogramming of funds within the Library to move to an
    integrated model. Such reprogramming is critical to the success of an
    ILS and would not be unique to the Library of Congress. The Library
    will benefit from the ``lessons learned'' by other research libraries
    as ILS is now the dominate model in the community.
    Digital Libraries
        A variety and diversity of collaborative projects are underway to
    explore the potential of digital libraries. Given the number of
    institutions, collections, and differing constituencies that must be
    served, there is a need for many models. A number of collaborative
    projects and programs are exploring these models with an array of
    public and private partners. The Library is participating in many of
    these projects. One unique and valuable digital library effort at the
    Library is the Global Legal Information Network (GLIN), an automation
    project that began production in the spring of 1995. Under the
    leadership of the Law Library of Congress, the de facto national law
    library serving the needs of members of Congress and the American
    people, GLIN is an international cooperative program in which
    participating nations share the work of indexing and abstracting each
    Nation's Official Gazette in exchange for electronic access to the laws
    of other nations. GLIN is an on-going effort that improves upon
    traditional acquisitions methods to provide ready electronic access to
    valuable legal sources of information. Its timely and ready access to
    the laws and regulations of other countries enables the Law Library to
    better serve Congress and its constituents. Eleven member countries
    currently participate in GLIN, and membership is expected to nearly
    double in the coming year. We fully support all efforts by the Library
    of Congress to expand GLIN to its full capability, and request the
    Subcommittee's approval of the Library's appropriations request for
    this valuable project for fiscal year 1998.
        The Library is also participating in the National Digital Library
    Federation. The Federation is a cooperative program among 16 public and
    academic institutions. The Library's National Digital Library (NDL)
    program focuses on American history and culture, adding an important
    dimension to the work of the Federation and to the building of global
    digital libraries. In 1996, NDL vastly increased the number of
    collections on the WWW. There are more than 350,000 digital files
    available with 1,700,000 digital files in production or under contract
    for digitization. We applaud the Subcommittee for its support of the
    Library's digitization efforts and believe that this support provides
    leverage to the digital library efforts underway in libraries
    throughout the Nation.
        Finally, the Library is engaged in a collaborative effort between
    ARL and the Association of American Universities. These associations
    are pursuing a networked-based distributed program for coordinated
    development for foreign acquisitions of research materials. Three pilot
    projects are underway for materials that originate in Latin America,
    Japan, and Germany. The Library of Congress has taken a leadership role
    in the German pilot project, the cornerstone of which is building the
    collections and electronic infrastructure to improve access to and
    delivery of German research resources. This is but one example of the
    Library's leadership in the acquisition of foreign research resources.
    The overseas offices service libraries throughout the United States,
    thus assisting in the building of these collections.
        Recently the General Accounting Office noted that the Library of
    Congress does not have the full legal authority to retain direct and
    indirect funds from approximately 100 participating research libraries
    throughout the United States. Our Associations welcome the opportunity
    to work with the members of the Subcommittee to clarify the Library's
    authority to continue this collaborative relationship that is both cost
    effective to the Congress and participating libraries. Continued
    investment in these initiatives will enable the Library, with other
    partners, to build digital libraries that will greatly enhance the
    education, research, and life-long learning opportunities for the
    public.
    American Folklife Center
        The American Folklife Center and its Archive of Folk Culture are
    uniquely qualified to collect and preserve the sound recordings,
    photographs, histories, and traditions that document the threads that
    make up our distinctly American society. The Center plays a key role in
    preserving and presenting American Folklife to the Nation. ALA, ARL,
    AALL, and SLA support the request for $966,5000 for this important
    program and were actively engaged in the recent two-year
    reauthorization. The Associations support continued authorization of
    the Center.
    Arrearage Reduction and Cooperative Cataloging
        The Library of Congress, in collaboration with others in the
    library community, continues to reduce the volume of unprocessed
    materials. The Library was able to reduce the arrearages this year by
    1.5 million items; a reduction of 47.2 percent since 1989. Cooperative
    programs with others in the library community, and in particular, the
    utilization of cataloging copy from other institutions has continued
    and indeed has increased this past year. The Program for Cooperative
    Cataloging is illustrative of collaborative efforts. 213 libraries are
    participating in the Program and contributed 14,173 bibliographic
    records, 97,964 name authorities, 8,074 series authorities, 2,026
    subject authorities, and 780 classification numbers. With the
    introduction of the ILS, even greater productivity and efficiencies
    should be realized.
    Collection Security
        The Library requested several evaluations regarding the security of
    the collections to ensure that these unique resources are secure. The
    Library is in the process of implementing many of the consultants'
    recommendations including implementing a Reader Registration System,
    installation of anti-theft gates in the Library's reading rooms, and
    more. As in past years, the library community supports the Library's
    request for additional funding to improve the security of the
    collections. Funding security measures is yet one more important facet
    in making the resources of the Library publicly available. The
    successful integration of the ILS within the Library will also
    significantly enhance other security related measures.
        ARL, ALA, AALL, and SLA look forward to working with members of the
    Subcommittee and we appreciate your continuing support for the Library
    and its programs that seek to provide public access to the Library's
    varied and unique resources.
                                     ______

                           organizational biographies
        The American Association of Law Libraries (AALL).--The American
    Association of Law Libraries is a nonprofit educational organization
    with over 5,000 members nationwide. Our members respond to the legal
    and governmental information needs of legislators, judges, and other
    public officials at all levels of government, corporations and small
    businesses, law professors and students, attorneys, and members of the
    general public.
        The American Library Association (ALA).--The American Library
    Association is a nonprofit educational organization of 58,000
    librarians, library educators, information specialists, library
    trustees, and friends of libraries representing public, school,
    academic, state, and specialized libraries dedicated to the improvement
    of library and information services. A new five-year initiative, ALA
    Goal 2000, aims to have ALA and librarianship be as closely associated
    with the public's right to a free and open information society--
    intellectual participation--as it is with the idea of intellectual
    freedom.
        The Association of Research Libraries (ARL).--The Association of
    Research Libraries is a not-for-profit organization representing 120
    research libraries in the United States and Canada. Its mission is to
    identify and influence forces affecting the future of research
    libraries in the process of scholarly communication. ARL programs and
    services promote equitable access to, and effective use of, recorded
    knowledge in support of teaching, research, scholarship, and community
    service.
        The Special Libraries Association (SLA).--The Special Libraries
    Association is an international professional association serving more
    than 14,000 members of the information profession, including special
    librarians, information managers, brokers, and consultants. The
    Association has 56 regional/state chapters in the U.S., Canada, Europe,
    and the Arabian Gulf States and 28 divisions representing subject
    interests or specializations. Special libraries/information centers can
    be found in organizations with specialized or focused information
    needs, such as corporations, law firms, news organizations, government
    agencies, associations, colleges, museums, and hospitals.
                                     ______

             Letter From the American Association of Law Libraries
                                         Washington, DC, June 12, 1997.
    Honorable Robert F. Bennett,
    Chair, Subcommittee on Legislative Branch, Senate Committee on
            Appropriations, S-125 Capitol, Washington, DC.
        Dear Mr. Chairman: On behalf of the American Association of Law
    Libraries, the American Library Association, the Association of
    Research Libraries and the Special Libraries Association, we urge the
    Committee to support fully the fiscal year 1998 budget request of
    $30,477,000 for the Superintendent of Documents Salaries and Expenses
    appropriation. We believe that this amount is necessary to maintain the
    Federal Depository Library Program, through which citizens have no-fee
    access to government information, as it moves towards a more electronic
    program. This appropriation request was made by the Public Printer at
    the June 5, 1997 hearing on the Government Printing Office. We ask that
    this letter be added to the public record of that hearing.
    Transition to a More Electronic Federal Depository Library Program
        Recognizing the need to centralize government printing and to
    establish a mechanism to provide our Nation's citizens with no-fee
    access to Federal government information, Congress passed the Printing
    Act of 1895 that created the Federal Depository Library Program (FDLP)
    within the Government Printing Office. The FDLP has evolved over more
    than one hundred years to become today one of the most effective and
    successful partnerships between the Federal government and the American
    people. The goals of the FDLP are based on principles that Congress and
    the library community have long affirmed as being essential to our
    democratic society. These principles were most recently expressed in
    the Government Printing Office's Study to Determine Measures Necessary
    for a Successful Transition to a More Electronic Federal Depository
    Library Program (June 1996). This study was conducted at the request of
    the conference committee on the Fiscal Year 1996 Legislative Branch
    Appropriations Act.
        We urge this Subcommittee to reaffirm these important principles
    and to support their implementation through adequate funding for the
    FDLP:
        Principle 1: The Public Has the Right of Access to Government
    Information.
        Principle 2: The Government Has an Obligation to Disseminate and
    Provide Broad Public Access to its Information.
        Principle 3: The Government Has an Obligation to Guarantee the
    Authenticity and Integrity of its Information.
        Principle 4: The Government Has an Obligation to Preserve Its
    Information.
        Principle 5: Government Information Created or Compiled by
    Government Employees or at Government Expense Should Remain in the
    Public Domain.
        The public's access to government information and the future
    success of the FDLP will only be achieved if the government, as creator
    and disseminator of information, staunchly upholds these principles.
        Under the direction of the Public Printer, the GPO Study was
    successful in analyzing many of the complex issues regarding the
    government's use of electronic information dissemination technologies.
    Attached to this statement is a letter from our associations to the
    Public Printer reiterating the continuing concerns of the library
    community during the transition years to a more electronic-based FDLP.
    Our two most critical concerns are the public's ability to locate
    information in a distributed electronic environment and the fundamental
    need to guarantee that electronic government information will be
    permanently accessible.
        We believe that, as the average user requires assistance in
    navigating through the complex layers of technology and the confusing
    maze of government to find the information they require, the role of
    depository libraries and librarians is more important than ever before.
    These libraries willingly invest substantial funds to provide highly
    trained staff, adequate space, costly equipment, and Internet
    connections so that the public has equitable, ready, efficient and no-
    fee access to government information in both print and electronic
    formats.
        Your constituents, whose tax dollars fund the collection and
    dissemination of information from agencies in all three branches of
    government, use the resources of their local depository library daily
    to access needed information. The results of GPO's most recent Biennial
    Survey are startling. In 1995, an estimated 189,000 to 237,000 users
    each week were provided expert service in locating and using depository
    materials at the 1,370 partner libraries. These numbers represent
    people from all walks of life and all levels of experience and
    technical sophistication. Without the local resources and services
    provided at depository libraries, these requests for government
    information would go unmet.
    Fiscal Year 1996 Enhancements to GPO Access Commendable
        GPO is to be commended for the steady progress in moving towards a
    more electronic FDLP. The development of the GPO Access system in terms
    of both increased public use and the growing number of electronic
    information products that are now available is laudable. With the
    passage of the GPO Electronic Information Access Enhancement Act of
    1993 (Public Law 103-40), Congress sought to develop an access point to
    information from all three branches of government. In December 1995, we
    applauded the decision of the Public Printer to provide free public
    access to all GPO Access products and services. As a result of that
    decision and the addition of many new titles to the system, recent
    monthly usage statistics are dramatic. In March 1997, over 4 million
    documents were downloaded from GPO Access.
        GPO has added many new electronic online products that provide
    timely and important information to your constituents. GPO Access
    continues to grow and currently includes 48 titles from all three
    branches of government in more than 70 databases. Some recent additions
    include the Congressional Pictorial Directory; the Annotated
    Constitution; the Code of Federal Regulations; historical Supreme Court
    opinions from the U.S. Air Force's Federal Legal Information Through
    Electronic (FLITE) file; and the Commerce Business Daily. These
    databases exemplify GPO's commitment to the continued development of
    GPO Access to meet the government information needs of the public.
        Another example of this commitment is the development in fiscal
    year 1996 of the Superintendent of Documents (SuDoc) Web site (http://
    www.access.gpo.gov/su__docs). With the rapid and pervasive growth of
    electronic government information, one of the greatest challenges for
    users is simply identifying and locating the database or source that
    they need. GPO's SuDoc Web site provides centralized bibliographic
    access to government resources in all formats through the online
    Monthly Catalog. Another valuable finding tool, GPO's electronic
    Pathway Indexer, links users to information resources at over 1,274
    other federal agency Web sites and indexes over 112,000 pages. In
    addition, GPO maintains a centralized database that allows users to
    search through the Government Information Locator Service (GILS)
    records of twenty-six federal agencies. These finding tools are
    essential services in a distributed electronic environment.
    GPO Fiscal Year 1998 Budget Request Essential
        To ensure the continued transition to a more electronic FDLP and
    continued improvement of GPO Access to meet the government information
    needs of the public, we urge the Subcommittee to fully support the
    Public Printer's fiscal year 1998 appropriations request of $30,477,000
    for the Superintendent of Documents Salaries and Expenses, of which
    $25,886,000 will maintain the FDLP. While some may view the move to
    electronic information as a means of cutting government costs, no data
    exists to support this assertion. In fact, the opposite is likely to be
    true particularly during the transition period.
        Congress and agencies are channeling substantial funds into
    developing information resource systems that take advantage of new
    technologies. It is equally important, however, that the channels of
    public access to government information remain open, efficient, and
    technologically relevant. Libraries and your constituents are doing
    their part by investing in technologies to assist them in accessing
    electronic information. Congress and the Federal government must
    continue to invest in systems and services like GPO Access that provide
    the public with government information. It is essential that GPO
    receive adequate funding for its many electronic initiatives so that
    the substantial progress of the past year continues.
    Erosion of Federal Government Information from the Public Domain
        One of the most serious concerns of the library community is that
    government entities, pressured by growing fiscal constraints or a
    failure to understand their full responsibilities under Title 44,
    circumvent the letter and spirit of the law. Unfortunately, librarians
    have long found it necessarily to track down missing or fugitive
    documents for your constituents. Now librarians and users are
    increasingly frustrated by the steady removal of important government
    resources from the public domain. The information needs of the American
    public are not served when agencies move to contract with private
    publishers and fail to supply these resources to the Superintendent of
    Documents for distribution to depository libraries. Furthermore, wide
    access and use of publicly-funded information is substantially impaired
    when licensing agreements prevent or curtail redissemination. To
    copyright or restrict distribution and use of government information is
    anathema to the principles of access that we uphold.
        The historical record of key government titles is also jeopardized
    by the discontinuation of print formats in favor of electronic
    distribution only. We have long recommended that format decisions
    should be based on the value and usability of the materials, and not
    solely on cost concerns. As directed by the Fiscal Year 1997
    Legislative Branch Appropriations Act, the distribution of two of the
    most important historically-significant Congressional titles, the U.S.
    Congressional Serial Set and the bound Congressional Record, has been
    severely cut. ALA and AALL have formally expressed concern with the
    impact of this decision on long-term public access.
        The Serial Set will be limited to only one depository library in
    each state. The bound Congressional Record, previously limited to only
    one copy per state, has been eliminated altogether. In neither case has
    a proven, comprehensive, permanent electronic replacement been
    developed that ensures long-term public access with the ability to
    migrate from one technological platform to another. We consider these
    titles among the core documents of our democracy and vital to the
    public's right to know. Electronic formats such as CD-ROM at this time
    fail to meet the necessary standards to ensure permanent long-term
    access and preservation, nor are they the official, authoritative
    versions (see attached AALL Resolution and Scientific American
    article). We welcome the opportunity to work with the Subcommittee on a
    timetable to guarantee that these core Congressional materials are
    usable, effective, permanently accessible, archivable and
    authoritative.
    Revision to Title 44 Needed Now
        The GPO Study provides a necessary framework to assist Congress in
    analyzing some of the very complex technical and policy issues that
    must be addressed as revisions to Title 44 are debated. Despite
    provisions of the Paperwork Reduction Act of 1995 and OMB Circular A-
    130, electronic information is not systematically made available to
    depository libraries. We strongly urge members of the 105th Congress to
    implement necessary changes to Title 44 so that there is no longer any
    doubt that the definition of government information extends to
    electronic resources. In addition, Congress must also continue its
    oversight of the FDLP and develop incentives to assure that all
    entities of the Federal government comply with the law.
        There are complex implementation challenges and significant costs
    ahead, particularly in terms of preservation and permanent public
    access of electronic information. Valuable government information
    resources, made available through agency Web sites, disappear daily. If
    these are not systematically captured for permanent, continuous public
    access, the information is useless to the American public. Any
    revisions to Title 44 must establish a systematic and comprehensive
    means for ensuring the preservation and permanent public access of
    government information. In the print world, this role has been uniquely
    filled by regional depository libraries. Their collections, located in
    every state, guarantee that the public will have ongoing and long-term
    access to publications from all agencies in the federal government. In
    the electronic environment, however, no equivalent system exists.
    Publishing agencies are not equipped to permanently maintain online
    access to electronic data, nor is it in their mission to do so. Nor is
    it within the mission or scope of the National Archives to provide the
    general public with ready and reliable access to this information on an
    ongoing basis.
        Libraries play an important part in providing the public with
    access to online services, and some libraries may have a role in
    electronically storing and maintaining databases in cooperation with
    publishing entities. But in the absence of a coordinated national
    program to systematically capture, preserve, and maintain ongoing
    access to electronic government data, important information is lost
    everyday as files come and go from agency web sites and computer
    servers. GPO has taken a lead in investigating partnership
    opportunities with agencies and libraries to develop models for
    permanent public access. These efforts must be supported with
    appropriations and based in statute on the government's affirmative
    responsibility to preserve and provide long-term public access to its
    information.
        Mr. Chairman, we are in the process of working with Congress to
    draft revisions to Title 44 that will guarantee that new technologies
    realize the potential of the information age by improving public access
    to government information. Our associations consider the problems of
    access to government information so pressing that in January we formed
    an Inter-Association Working Group on Government Information Policy.
    This group has identified the key issues that need to be addressed by
    legislation. Our Goals for Revising U.S.C. Title 44 to Enhance Public
    Access to Federal Government Information are attached.
        In addition, we have recently transmitted to members of the Joint
    Committee on Printing a legislative proposal from the library community
    to amend Chapter 19, Title 44. This draft bill, the ``Federal
    Information Access Act of 1997,'' meets our goals to improve the
    public's ability to access and use government information, paid for by
    their tax dollars, in all formats. We will be pleased to share the
    progress of this important endeavor with this Subcommittee. We thank
    you for your continued strong support for the Federal Depository
    Library Program and for this opportunity to enter our statement into
    the record of your recent hearing.
                Sincerely,
                                       Robert L. Oakley,
        Washington Affairs Representative, American Association of Law
                                                             Libraries.
                                       Carol C. Henderson,
               Executive Director--Washington Office, American Library
                                                           Association.
                                       Prudence S. Adler,
       Assistant Executive Director, Association of Research Libraries.
                                       David R. Bender,
                     Executive Director, Special Libraries Association.
                                     ______

                                  Attachment 1

                                                        April 26, 1996.
    Michael F. DiMario,
    Public Printer, U.S. Government Printing Office, 732 N. Capitol Street,
            N.W., Washington, D.C. 20401.
        Dear Mr. DiMario: Thank you for this opportunity to respond to the
    recently released Report to the Congress: ``Study to Identify Measures
    Necessary for a Successful Transition to a More Electronic Federal
    Depository Library Program.'' We are responding to your request to
    submit written comments based on the oral remarks delivered at last
    week's joint meeting between members of the Working Group and the
    Advisors. Our comments today reflect the views of the members of the
    American Association of Law Libraries, the American Library
    Association, the Association of Research Libraries and the Special
    Libraries Association.
        We are pleased that our associations, which represent more than
    75,000 professionals in public, academic and special libraries
    throughout the country, were included in an advisory capacity during
    the lengthy study process. We commend the Government Printing Office
    for carrying out this legislatively-mandated study in a manner that
    considered the views of all three branches of the government, the
    library community and the private sector. It is especially noteworthy
    that members of the Working Group consisted of representatives from key
    agencies, including the National Archives and Records Administration
    (NARA), as well as many Congressional staff. It is hoped that one
    outcome of this collaborative approach will be improved understanding
    by all stakeholders of the serious issues of concern to libraries and
    other users of government information as the transition to a more
    electronic Federal Depository Library Program (FDLP) proceeds.
        The FDLP has existed for one hundred and thirty-nine years as a
    very successful partnership program between the federal government,
    libraries and the public. This partnership must become even stronger in
    the future in order that the move to a more electronic program succeeds
    in reaching its goal: that is, the use of new technologies to expand
    the public's access to government information. We are pleased with the
    draft report's principles for federal government information, including
    the publics right to know and the government's responsibility to
    disseminate and provide broad and permanent access to its information.
    The well-articulated goals for an electronic FDLP, as noted in the
    draft report, must be realized to ensure that these important
    principles are achieved.
        It is especially gratifying that many of the comments and concerns
    addressed in our previous joint letter to you regarding the Transition
    Plan were incorporated into the draft report. We do wish to offer some
    additional general comments on the draft study as there continue to be
    many areas of serious concern and importance to our members.
        Time frame.--We are pleased that the draft report offers a more
    realistic and technologically feasible five to seven year time frame
    for the transition. The Transition Chronology proposed in the strategic
    plan better reflects the nations technological infrastructure: the
    ability of agencies to create and provide access to information
    electronically; and the capabilities of libraries and users to
    effectively utilize such information. We will urge members of the
    Congressional authorizing and appropriating committees to support this
    more realistic time frame so that no barriers develop during the
    transitional years that would reduce the public's access to government
    information.
        Viability of print.--We are pleased that the draft study recognizes
    the continued viability of a variety of formats, including print, to
    meet user needs. Format decisions should be based on usage on the needs
    of the user community, and also on an agency's own dissemination
    requirements. While electronic information offers many advantages to
    paper, including timeliness, the ability to perform full-text searches
    and to manipulate data, certain types of materials will continue to be
    more efficiently created, disseminated and used in paper format.
        Another problematic area regarding format decisions concerns fee-
    based products and services; namely, when an agency stops production of
    a title in print and moves it into a fee-based online service. One
    example of this is that depository libraries have in the past been able
    to select the FBIS and JPRS reports in print formats but these are now
    available online through paid subscriptions to the new World News
    Connection service of the National Technical Information Service
    (NTIS). It is planned that by the end of this year these important
    materials while available only online while the printed and microfiche
    reports will be phased out. Valuable materials that have traditionally
    been available to depositories will no longer be included in the
    program since NTIS does not offer no-fee access to the World News
    Connection for depository libraries.
        Redundancy and diversity.--We are pleased that the draft study
    recognizes the principles of redundancy and diversity as articulated in
    NCLIS Principle #5: The Federal Government Should Ensure a Wide
    Diversity of Sources of Access, Private as Well as Governmental, to
    Public Information. Redundancy--in access, in formats, and in
    preservation--is both a necessity and an advantage. It provides a
    safeguard in case of overloaded systems, natural or man-made disasters,
    and even government shutdowns.
        It is the government's affirmative obligation to ensure permanent
    access to the information that it produces. In the electronic
    environment diverse and multiple partners are needed to promote and
    ensure access and preservation to government information long after its
    initial creation and dissemination. At the same time a diversity of
    other public, private and not-for-profit sources is critical to
    ensuring that information remains available in useful and convenient
    ways.
        Centralization.--We are pleased that the draft study recognizes the
    need for coordination and centralization to meet the goals of the FDLP.
    The program in a distributed electronic environment requires
    coordination to bring all participants together on issues of: (1)
    standardization and guidelines to ensure ease of locating information
    and guarantees of long-term access; (2) no-fee access to all government
    information, including fee-based products and services; and (3)
    usability. The complexities of these issues, particularly when many
    agencies are creating their own web sites, seems to be underestimated
    in the draft report. We commend GPO ACCESS as the legislatively-
    mandated centralized point of entry to electronic government
    information and the GPO locator service that assists the public in
    finding information across diverse government entities. Users must have
    timely and comprehensive funding aids to the growing vast universe of
    electronic government information, and centralized coordination is the
    most efficient means.
        In addition to the above general comments on the draft study, we
    firmly believe that the study's goal of ensuring broader public access
    through electronic means will not be achieved unless the following
    concerns are addressed. While details of the draft study and the
    strategic plan remain to be worked out, these issues are critical to
    the transition's success. We hope also that the collaborative approach
    which GPO brought to the study itself will be maintained so that all
    interested and involved partners, including our associations, may
    continue to participate in the process.
        More data needed.--We remain very concerned that although some
    useful information was gathered during the study process, neither the
    draft report, the models developed as part of the task force reports,
    nor the strategic plan are based on substantive data regarding costs to
    and capabilities of the government, libraries or the public to produce,
    access and use predominately electronic information. We believe that a
    technical scan is necessary and we will urge Congress to approve
    funding for the Technical Implementation Assistance which the report
    proposes.
        No-fee access.--We strongly support the study's first goal
    statement which ensures that the public has equitable, no-fee local
    access to government information through depository libraries. The
    draft study addresses this issue by suggesting that reimbursement to
    agencies for fee-based services could come from the Superintendent of
    Documents. There are no assurances, however, that there will be
    continued adequate funding to support the transition plan.
    Consequently, we are concerned that government information for which
    agencies must recover costs, particularly fee-based products and
    services, will become a new generation of fugitive information.
        Long-term permanent access and preservation.--The draft report
    acknowledges that issues relating to long-term access and preservation
    of electronic government information require new relationships, indeed
    new strategies between all stakeholders: GPO, agencies, NARA and
    participating libraries. Yet the draft fails to identify what these
    strategies may entail and the responsibilities for each partner. Long-
    term access and preservation issues are critical to the success of the
    FDLP: thus it is crucial that additional information regarding these
    activities be provided.
        In addition, the draft report includes the recommendation that GPO
    will assume new responsibilities in the archival arena. Through many
    years of maintaining preservation and archival programs and
    collections, libraries have learned that these efforts require
    significant investments in technological solutions (e.g.
    deacidification and digitization pilots), personnel, and facilities. To
    be successful in undertaking new preservation and archiving
    responsibilities, GPO will need to provide additional detail regarding
    how such tasks will be accomplished. We suggest that a comprehensive
    study be undertaken among all partners to guarantee permanent long-term
    access and preservation. For example, it is not clear how and when GPO
    would support the ``periodic review and refreshing of data to different
    mediums.''
        The issues of long-term permanent access and preservation are
    central to the transition to a more electronic program and thus we are
    especially concerned that the draft study offers no specifics, no data,
    no costs and no assurances. We reaffirm that these critical issues are
    the responsibility of the government and that they must be
    comprehensively addressed before the transition plan is implemented.
    The questions are very basic ones: first, how do we assure that
    electronic information will be available and usable next month, next
    year, or in twenty-five, fifty, or even a hundred years from now; and
    second, who will be responsible for ensuring long-term permanent
    access. In shifting long-term access from depository libraries to the
    government, as the draft study suggests, we must be assured that
    funding will remain adequate so that the government can refresh and
    migrate information. Otherwise, our national historical records will
    disappear into a black hole and the advantages of electronic
    information will be nullified.
        Copyright-like restrictions.--Principle 5 states that Government
    information created or compiled at Government expense or by Government
    employees as part of their official duties, regardless of the format in
    which it is published, is in the public domain. We strongly affirm this
    principle and note that some agencies are imposing copyright-like
    restrictions on electronic information. Worrisome patterns are already
    being proposed; for example, in the case of agency restricting the
    downloading of information or its electronic re-transmission. This is
    an egregious barrier not only to the publics current and long term
    access to information but also to innovative and creative forces in the
    private sector to develop enhanced products and services. Further,
    regarding the proposal of the National Technical Information Service,
    libraries can neither restrict nor control users from placing
    electronic information on the Internet.
        Fee-based products and services.--In order to fulfill the goals of
    an enhanced FDLP program, it is vital that materials not currently in
    the program, such as those created by self-supporting agencies who are
    by law required to recover their costs, be included. While the draft
    report proposes models through which these materials would enter the
    program, the key question is, of course, who is going to pay. GPO
    suggests that the Superintendent of Documents would reimburse agencies
    for the cost of including these products and services in the program.
    However, there are no guarantees that Congress would assure the
    necessary funding.
        This issue addresses the troubling question of cost recovery and
    quasi-business corporations. Regarding the NTIS proposal for example,
    it is very troubling that libraries would be asked to become watchdogs
    to ensure that these electronic materials do not leak out into the
    public domain. We are also concerned that these or similar restrictions
    could potentially be used by agencies for access to services for which
    users have paid subscriptions. A strong affirmation on redistribution
    without copyright-like restrictions for agency cost-recovery programs
    is imperative.
        Role and responsibilities of program libraries.--We are concerned
    that since all depository libraries will soon be required to have
    Internet access and since, according to the plan, most government
    information will be available in electronic format, even the smallest
    program library will by default become a ``regional'' for electronic
    government information. Requiring all libraries to fulfill the regional
    depository libraries' statutory responsibilities of access and service
    will place undue burdens on selectives. In order to prevent this
    occurrence, more flexibility must be built into the program that allows
    libraries to provide access to electronic information in a manner they
    can accommodate. We must all acknowledge the tremendous value of
    program libraries and it is important to provide incentives for their
    continued participation in the program.
        Conclusion.--These comments on the draft study and the strategic
    plan supplement our oral comments delivered at last week's joint
    Working Group and Advisors meeting. We will submit additional comments
    on the draft study and particularly on some of the specific Task Force
    Reports within the next few weeks. In particular, we are troubled that
    some proposed alternative models in several of the Task Force Reports
    may not be wholly in accord with the study's affirmed principles and
    goals and thus are very problematic to our members.
        We are especially pleased to see the new draft language of the
    definitions in Chapter 19, Title 44 that acknowledge that electronic
    information is explicitly defined in the law as being a key component
    of the FDLP. It is crucial that Chapter 19 be amended to reflect these
    changes in definitions and the broader scope of the FDLP to assure that
    the goals for a more electronic program are achieved.
        We believe that funding for the technology grants will provide seed
    money for small selective libraries which otherwise would be unable to
    provide access to electronic products and services to members of their
    local communities. One-time technology grants are a step in the right
    direction although they may not be sufficient since technology itself
    changes so rapidly as do user needs. To strengthen the justification
    for these technology grants we suggest that GPO determine the number of
    libraries that would be unable to provide access to the expanding array
    of electronic FDLP materials without these start-up grants.
        We would like to make the following recommendations: (1) that the
    substantial progress and inter-agency dialog achieved throughout the
    past year continue; (2) that GPO and agencies work together to
    determine consistency regarding format and standards; and (3) that the
    Working Group model continue with Information Resource Management
    representatives from GPO the Library of Congress, the Office of
    Management and Budget, and the Administrative Office of the United
    States Courts as well as the library community and users.
        We remain concerned that the draft study lacks clear incentives for
    agencies to participate in the program, particularly when their budgets
    are being cut. We also firmly believe that means of oversight and
    compliance must be provided in a meaningful and effective way. Our
    associations, representing the broader library community, are willing
    to work with you to supplement and strengthen the study by offering
    additional information in the following areas: the capabilities of and
    impact on libraries and users; the role and responsibilities of
    regional and selective depository libraries; and the troublesome
    questions of oversight and compliance. Thank you very much for this
    opportunity to comment on the draft report.
                Sincerely,
                                       Robert L. Oakley,
        Washington Affairs Representative, American Association of Law
                                                             Libraries.
                                       Carol C. Henderson,
               Executive Director--Washington Office, American Library
                                                           Association.
                                       Prudence S. Adler,
       Assistant Executive Director, Association of Research Libraries.
                                       David R. Bender,
                     Executive Director, Special Libraries Association.
                                     ______

    Attachment 2.--Resolution on the U.S. Congressional Serial Set and the
                           Bound Congressional Record

        WHEREAS, The U.S. Congressional Serial Set and the bound
    Congressional Record together comprise a significant portion of the
    official historical record of Congress; and
        WHEREAS, The U.S. Congressional Serial Set has been produced since
    1813 in a bound, numbered edition, and includes Senate and House
    documents, congressional committee reports, presidential and other
    executive publications, treaty materials, and selected reports of
    nongovernmental organizations; and
        WHEREAS, The bound Congressional Record has been produced since
    1873 as the official record of the proceedings and debates of Congress
    in a uniform, numbered edition, superseding its predecessors, the
    Annals of Congress (1789-1824), the Register of Debates (1824-1837),
    and the Congressional Globe (1833-1873); and
        WHEREAS, The U.S. Congressional Serial Set and the bound
    Congressional Record are important historical materials for the legal
    and research communities, particularly for the compilation of
    legislative histories needed to determine legislative intent in
    interpreting federal statutes; and
        WHEREAS, The U.S. Congressional Serial Set and the bound
    Congressional Record have been available through the Federal Depository
    Library Program, providing ready no-fee access to the official version
    of these important titles in nearly every Congressional district; and
        WHEREAS, The U.S. Congressional Serial Set and the print bound
    Congressional Record, as official, authoritative records of the
    deliberations of Congress, are produced on acid free permanent paper to
    ensure their preservation for future research and scholarship; and
        WHEREAS, The production and dissemination of these historically-
    significant titles in microfiche, CD-ROM or other electronic formats do
    not at this time meet required standards to ensure permanent long-term
    access and preservation, nor are they the official, authoritative
    versions; now, therefore, be it resolved that
        RESOLVED, The American Association of Law Libraries urge Congress
    to continue to fund the production of the U.S. Congressional Serial Set
    and the bound Congressional Record in the permanent, print versions
    required for long-term access and preservation; and be it further
        RESOLVED, That the American Association of Law Libraries urge
    Congress to recognize the historical significance of these print titles
    as the official record of their deliberations, and to guarantee their
    continued no-fee availability to the American public through local
    depository libraries; and be it further
        RESOLVED, That the American Association of Law Libraries transmit a
    copy of this resolution to Members of the House and Senate Legislative
    Appropriations Subcommittees, to other appropriate congressional
    committees, and to the Public Printer.
        Endorsed by the A.A.L.L. Executive Board, July 19, 1996.
                                     ______

                                  Attachment 3

                   [From the Scientific American, Jan. 1995]

                  Ensuring the Longevity of Digital Documents

                              (By Jeff Rothenberg)
        The digital medium is replacing paper in a dramatic record-keeping
    revolution. But such documents may be lost unless we act now.
        The year is 2045, and my grandchildren (as yet unborn) are
    exploring the attic of my house (as yet unbought). They find a letter
    dated 1995 and a CD-ROM. The letter says the disk contains a document
    that provides the key to obtaining my fortune (as yet unearned). My
    grandchildren are understandably excited, but they have never before
    seen a CD--except in old movies. Even if they can find a suitable disk
    drive, how will they run the software necessary to interpret what is on
    the disk? How can they read my obsolete digital document?
        This imaginary scenario reveals some fundamental problems with
    digital documents. Without the explanatory letter, my grandchildren
    would have no reason to think the disk in my attic was worth
    deciphering. The letter possesses the enviable quality of being
    readable with no machinery, tools or special knowledge beyond that of
    English. Because digital information can be copied and recopied
    perfectly, it is often extolled for its supposed longevity. The truth,
    however, is that because of changing hardware and software, only the
    letter will be immediately intelligible 50 years from now.
        Information technology is revolutionizing our concept of record
    keeping in an upheaval as great as the introduction of printing, if not
    of writing itself. The current generation of digital records has unique
    historical significance. Yet these documents are far more fragile than
    paper, placing the chronicle of our entire period in jeopardy.
        My concern is not unjustified. There have already been several
    potential disasters. A 1990 House of Representatives report describes
    the narrow escape of the 1960 U.S. Census data. The tabulations were
    originally stored on tapes that became obsolete faster than expected as
    revised recording formats supplanted existing ones (although most of
    the information was successfully transferred to newer media). The
    report notes other close calls as well, involving tapes of the
    Department of Health and Human Services; files from the National
    Commission on Marijuana and Drug Abuse, the Public Land Law Review
    Commission and other agencies; the Combat Area Casualty file containing
    P.O.W. and M.I.A. records for the Vietnam War; and herbicide
    information needed to analyze the impact of Agent Orange. Scientific
    data are in similar jeopardy, as irreplaceable records of numerous
    experiments conducted by the National Aeronautics and Space
    Administration and other organizations age into oblivion.
        So far the undisputed losses are few. But the significance of many
    digital documents--those we consider too unimportant to archive--may
    become apparent only long after they become unreadable. Unfortunately,
    many of the traditional methods developed for archiving printed matter
    are not applicable to electronic files. The content and historical
    value of thousands of records, databases and personal documents may be
    irretrievably lost to future generations if we do not take steps to
    preserve them now.
                             from here to eternity
        Although digital information is theoretically invulnerable to the
    ravages of time, the physical media on which it is stored are far from
    eternal. If the optical CD in my attic were a magnetic disk, attempting
    to read it would probably be futile. Stray magnetic fields, oxidation
    and material decay can easily erase such disks. The contents of most
    digital media evaporate long before words written on high-quality
    paper. They often become unusably obsolete even sooner, as media are
    superseded by new, incompatible formats--how many readers remember
    eight-inch floppy disks? It is only slightly facetious to say that
    digital information lasts forever--or five years, whichever comes
    first.
        Yet neither the physical fragility of digital media nor their
    lemminglike tendency toward obsolescence constitutes the worst of my
    grandchildren's problems. My progeny must not only extract the content
    of the disk but must also interpret it correctly. To understand their
    predicament, we need to examine the nature of digital storage. Digital
    information can be saved on any medium that is able to represent the
    binary digits (``bits'') 0 and 1. We will call an intended, meaningful
    sequence of bits, with no intervening spaces, punctuation or
    formatting, a bit stream.
        Retrieving a bit stream requires a hardware device, such as a disk
    drive, and special circuitry for reading the physical representation of
    the bits from the medium. Accessing the device from a given computer
    also requires a ``driver'' program. After the bit stream is retrieved,
    it must still be interpreted. This task is not straightforward, because
    a given bit stream can represent almost anything--from a sequence of
    integers to an array of dots in a pointillist-style image.
        Furthermore, interpreting a bit stream depends on understanding its
    implicit structure, which cannot explicitly be represented in the
    stream. A bit stream that represents a sequence of alphabetic
    characters may consist of fixed-length chunks (``bytes''), each
    representing a code for a single character. For instance, in one
    current scheme, the eight bits 01110001 stand for the letter q. To
    extract the bytes from the bit stream, thereby ``parsing'' the stream
    into its components, we must know the length of a byte.
        One way to convey the length is to encode a ``key'' at the
    beginning of the bit stream. But this key must itself be represented by
    a byte of some length. A reader therefore needs another key to
    understand the first one. Computer scientists call the solution to such
    a recursive problem a ``bootstrap'' (from the fanciful image of pulling
    oneself up by the bootstraps). In this case, a bootstrap must provide
    some context, which humans can read, that explains how to interpret the
    digital storage medium. For my grandchildren, the letter accompanying
    the disk serves this role.
        After a bit stream is correctly parsed, we face another recursive
    problem. A byte can represent a number or an alphabetic character
    according to a code. To interpret such bytes, therefore, we need to
    know their coding scheme. But if we try to identify this scheme by
    inserting a code identifier in the bit stream itself, we will need
    another code identifier to interpret the first one. Again, human-
    readable context must serve as a bootstrap.
        Even more problematic, bit streams may also contain complex cross-
    referencing information. The stream is often stored as a collection, or
    file, of bits that contains logically related but physically separate
    elements. These elements are linked to one another by internal
    references, which consist of pointers to other elements or of patterns
    to be matched. (Printed documents exhibit similar schemes, in which
    page numbers serve as pointers.)
                           interpreting a bit stream
        Suppose my grandchildren manage to read the bit stream from the CD-
    ROM. Only then will they face their real challenge: interpreting the
    information embedded in the bit stream. Most files contain information
    that is meaningful solely to the software that created them. Word-
    processing files embed format instructions describing typography,
    layout and structure (titles, chapters and so on). Spreadsheet files
    embed formulas relating their cells. So-called hypermedia files contain
    information identifying and linking text, graphics, sound and temporal
    data.
        For convenience, we call such embedded information--and all other
    aspects of a bit stream's representation, including byte length,
    character code and structure--the encoding of a document file. These
    files are essentially programs: instructions and data that can be
    interpreted only by appropriate software. A file is not a document in
    its own right--it merely describes a document that comes into existence
    when the file is interpreted by the program that produced it. Without
    this program (or equivalent software), the document is a cryptic
    hostage of its own encoding.
        Trial-and-error might decode the intended text if the document is a
    simple sequence of characters. But if it is complex, such a brute-force
    approach is unlikely to succeed. The meaning of a file is not inherent
    in the bits themselves, any more than the meaning of this sentence is
    inherent in its words. To understand any document, we must know what
    its content signifies in the language of its intended reader.
    Unfortunately, the intended reader of a document file is a program.
    Documents such as multimedia presentations are impossible to read
    without appropriate software: unlike printed words, they cannot just be
    ``held up to the light.''
        Is it necessary to run the specific program that created a
    document? In some cases, similar software may at least partially be
    able to interpret the file. Still, it is naive to think that the
    encoding of any document--however natural it seems to us--will remain
    readable by future software for very long. Information technology
    continually creates new schemes, which often abandon their predecessors
    instead of subsuming them.
        A good example of this phenomenon occurs in word processing. Most
    such programs allow writers to save their work as simple text, using
    the current seven-bit American Standard Code for Information
    Interchange (or ASCII). Such text would be relatively easy to decode in
    the future if seven-bit ASCII remains the text standard of choice. Yet
    ASCII is by no means the only popular text standard, and there are
    proposals to extend it to a 16-bit code (to encompass non-English
    alphabets). Future readers may therefore not be able to guess the
    correct text standard. To complicate matters, authors rarely save their
    work as pure text. As Avra Michelson, then at the National Archives,
    and I pointed out in 1992, authors often format digital documents quite
    early in the writing process and add figures and footnotes to provide
    more readable and complete drafts.
        If ``reading'' a document means simply extracting its content--
    without its original form--then we may not need to run the original
    software. But content can be lost in subtle ways. Translating word-
    processing formats, for instance, often displaces or eliminates
    headings, captions or footnotes. Is this merely a loss of structure, or
    does it impinge on content? If we transform a spreadsheet into a table,
    deleting the formulas that relate the table's entries to one another,
    have we affected content? Suppose the CD in my attic contains a
    treasure map depicted by the visual patterns of word and line spacings
    in my original digital version of this article. Because these patterns
    are artifacts of the formatting algorithms of my software, they will be
    visible only when the digital version is viewed using my original
    program. If we need to view a complex document as its author viewed it,
    we have little choice but to run the software that generated it.
        What chance will my grandchildren have of finding that software 50
    years from now? If I include a copy of the program on the CD, they must
    still find the operating system software that allows the program to run
    on some computer. Storing a copy of the operating system on the CD may
    help, but the computer hardware required to run it will have long since
    become obsolete. What kind of digital Rosetta Stone can I leave to
    provide the key to understanding the contents of my disk?
                                 migrating bits
        To prevent digital documents from being lost, we must first
    preserve their bit streams. That means copying the bits onto new forms
    of media to ensure their accessibility. The approach is analogous to
    preserving text, which must be transcribed periodically. Both
    activities require ongoing effort: future access depends on an unbroken
    chain of such migrations frequent enough to prevent media from becoming
    physically unreadable or obsolete before they are copied. A single
    break in this chain renders digital information inaccessible, short of
    heroic effort. Given the current lack of permanence of media and the
    rate at which their forms evolve, migration may need to be as frequent
    as once every few years. Conservative estimates suggest that data on
    digital magnetic tape should be copied once a year to guarantee that
    none of the information is lost. (Analog tapes may remain playable for
    many years because they record more robust signals that degrade more
    gradually.)
        In the long run, we might be able to develop long-lived storage
    media, which would make migration less urgent. At the moment, media
    with increased longevity are not on the horizon. Nevertheless, the cost
    of migration may eventually force the development of such products,
    overriding our appetite for improved performance.
        An ancient text can be preserved either by translating it into a
    modern language or by copying it in its original dialect. Translation
    is attractive because it avoids the need to retain knowledge of the
    text's original language, yet few scholars would praise their
    predecessors for taking this approach. Not only does translation lose
    information, it also makes it impossible to determine what information
    has been lost, because the original is discarded. (In extreme cases,
    translation can completely undermine content: imagine blindly
    translating both languages in a bilingual dictionary into a third
    language.) Conversely, copying text in its original language (saving
    the bit stream) guarantees that nothing will be lost. Of course, this
    approach assumes that knowledge of the original language is retained.
        Archivists have identified two analogous strategies for preserving
    digital documents. The first is to translate them into standard forms
    that are independent of any computer system. The second approach is to
    extend the longevity of computer systems and their original software to
    keep documents readable. Unfortunately, both strategies have serious
    shortcomings.
        On the surface, it appears preferable to translate digital
    documents into standard forms that would remain readable in the future,
    obviating the need to run obsolete software. Proponents of this
    approach offer the relational database (introduced in the 1970's by
    E.F. Codd, now at Codd & Date, Inc., in San Jose, Calif.) as a
    paradigmatic example. Such a database consists of tables representing
    relations among entities. A database of employees might contain a table
    having columns for employee names and their departments. A second table
    in the database might have department names in its first column,
    department sizes in its second column and the name of the department
    head in a third. The relational model defines a set of formal
    operations that make it possible to combine the relations in these
    tables--for example, to find the name of an employee's department head.
        Because all relational database systems implement this same
    underlying model, any such database can in principle be translated into
    a standard tabular form acceptable to any other system. Files
    represented this way could be copied to new media as necessary, and the
    standard would ensure readability forever.
                              flaws of translation
        Regrettably, this approach is flawed in two fundamental ways.
    First, relational databases are less standardized than they appear.
    Commercial relational database systems distinguish themselves from one
    another by offering features that extend the relational model in
    nonstandard ways. Moreover, the limitations of such databases are
    already leading to the adoption of new models. The tables in a
    relational database cannot transparently show structure. That is, the
    database could not immediately make it clear that a corporation
    consisted of one headquarters, five national offices, 25 divisions and
    100 departments. Various object-oriented database models (which can
    represent structure directly) are evolving to satisfy this need. Such
    rapid evolution is neither accidental nor undesirable. It is the
    hallmark of information technology.
        Furthermore, far from being a representative example, relational
    databases are practically unique. No other type of digital document has
    nearly so formal a basis for standardization. Word processors, graphics
    programs, spreadsheets and hypermedia programs each create far more
    varied documents. The incompatibility of word-processing files
    exemplifies this problem. It did not arise simply because companies
    were trying to distinguish their products in the marketplace. Rather it
    is a direct outgrowth of the technology's tendency to adapt itself to
    the emerging needs of users.
        As yet, no common application is ready to be standardized. We do
    not have an accepted, formal understanding of the ways that humans
    manipulate information. It is therefore premature to attempt to
    enumerate the most important kinds of digital applications, let alone
    to circumscribe their capabilities through standards. Forcing users to
    accept the limitations imposed by such standards or restricting all
    digital documents to contain nothing but text as a lowest common
    denominator would be futile. The information revolution derives its
    momentum precisely from the attraction of new capabilities. Defining
    long-term standards for digital documents may become feasible when
    information science rests on a more formal foundation, but such
    standards do not yet offer a solution.
        Translating a document into successive short-term standards offers
    false hope. Successive translation avoids the need for ultimate
    standards, but each translation introduces new losses. Would a modern
    version of Homer's ``Iliad'' have the same literary impact if it had
    been translated through a series of intermediate languages rather than
    from the earliest surviving texts in ancient Greek? In theory,
    translating a document through a sequence of standards should enable
    scholars to reconstruct the original document. Yet that requires each
    translation to be reversible without loss, which is rarely the case.
        Finally, translation suffers from a fatal flaw. Unlike English and
    ancient Greek, whose expressive power and semantics are roughly
    equivalent, digital documents are evolving so rapidly that shifts in
    the forms of documents must inevitably arise. New forms do not
    necessarily subsume their predecessors or provide compatibility with
    previous formats. Old documents cannot always be translated into
    unprecedented forms in meaningful ways, and translating a current file
    back into a previous form is frequently impossible. For example, many
    older, hierarchical databases were completely redesigned to fit the
    relational model, just as relational databases are now being
    restructured to fit emerging object-oriented models. Shifts of this
    kind make it difficult or meaningless to translate old documents into
    new standard forms.
        The alternative to translating a digital document is to view it by
    using the program that produced it. In theory, we might not actually
    have to run this software. If we could describe its behavior in a way
    that does not depend on any particular computer system, future
    generations could re-create the behavior of the software and thereby
    read the document. But information science cannot yet describe the
    behavior of software in sufficient depth for this approach to work, nor
    is it likely to be able to do so in the near future. To replicate the
    behavior of a program, there is currently little choice but to run it.
        For this reason, we must save the programs that generate our
    digital documents, as well as all the system software required to run
    those programs. Although this task is monumental, it is theoretically
    feasible. Authors often include an appropriate application program and
    operating system to help recipients read a digital document. Some
    applications and system software may remain ubiquitous, so that authors
    would need only to refer readers to those programs. Free, public-domain
    software is already widely available on the Internet. Moreover, when
    proprietary programs become obsolete, their copyright restrictions may
    expire, making them available to future users.
        How can we provide the hardware to run antiquated systems and
    application software? A number of specialized museums and ``retro-
    computing'' clubs are attempting to maintain computers in working
    condition after they become obsolete. Despite a certain undeniable
    charm born of its technological bravado, this method is ultimately
    futile. The cost of repairing or replacing worn out components (and
    retaining the expertise to do so) must inevitably outweigh the demand
    for any outmoded computer.
        Fortunately, software engineers can write programs called
    emulators, which mimic the behavior of hardware. Assuming that
    computers will become far more powerful than they are today, they
    should be able to emulate obsolete systems on demand. The main drawback
    of emulation is that it requires detailed specifications for the
    outdated hardware. To be readable for posterity, these specifications
    must be saved in a digital form independent of any particular software,
    to prevent having to emulate one system to read the specifications
    needed to emulate another.
                             saving bits of history
        If digital documents and their programs are to be saved, their
    migration must not modify their bit streams, because programs and their
    files can be corrupted by the slightest change. If such changes are
    unavoidable, they must be reversible without loss. Moreover, one must
    record enough detail about each transformation to allow reconstruction
    of the original encoding of the bit stream. Although bit streams can be
    designed to be immune to any expected change, future migration may
    introduce unexpected alterations. For example, aggressive data
    compression may convert a bit stream into an approximation of itself,
    precluding a precise reconstruction of the original. Similarly,
    encryption makes it impossible to recover an original bit stream
    without the decryption key.
        Ideally, bit streams should be sealed in virtual envelopes: the
    contents would be preserved verbatim, and contextual information
    associated with each envelope would describe those contents and their
    transformation history. This information must itself be stored
    digitally (to ensure its survival), but it must be encoded in a form
    that humans can read more simply than they can the bit stream itself,
    so that it can serve as a bootstrap. Therefore, we must adopt bootstrap
    standards for encoding contextual information; a simple, text-only
    standard should suffice. Whenever a bit stream is copied to new media,
    its associated context may be translated into an updated bootstrap
    standard. (Irreversible translation would be acceptable here, because
    only the semantic content of the original context need be retained.)
    These standards can also be used to encode the hardware specifications
    needed to construct emulators.
        Where does this leave my grandchildren? If they are fortunate,
    their CD may still be readable by some existing disk drive, or they may
    be resourceful enough to construct one, using information in my letter.
    If I include all the relevant software on the disk, along with
    complete, easily decoded specifications for the required hardware, they
    should be able to generate an emulator to run the original software
    that will display my document. I wish them luck.
                                     ______

      Attachment 4.--Goals for Revising U.S.C. Title 44 to Enhance Public
                    Access to Federal Government Information

        developed by the inter-association working group on government
                          information policy--may 1997
        Congress currently is examining ways to improve public access to
    government information and public accountability of government entities
    through revisions to Title 44 of the United States Code and other
    applicable statutes. We affirm that any changes to Title 44, the
    Federal Depository Library Program (FDLP), or federal government
    information policies must incorporate the following fundamental
    principles and goals of public access.
    GOAL 1: The law must broaden, strengthen, and enhance public access to
            all forms of government information.
                PRINCIPLES:
        The public has the right to access the information produced by
    their government. All government information in all formats should be
    published initially by the government and be made available, with no
    restrictions, to the public through libraries.
        To foster an informed citizenry capable of fully participating in
    our democratic process and provide for economic development, the public
    must be ensured easy and equitable access to federal government
    information from the legislative, executive, and judicial branches at
    no cost to the citizen.
        To guarantee the availability of its information, the government
    should disseminate it in usable formats to the public, libraries, and
    other information providers and provide timely, equitable, effective,
    no-fee public access to its information through depository libraries.
        Government information created or compiled by government or
    contractor employees or at government expense must remain in the public
    domain with no copyright-like restrictions. The public's access to
    government information must not be denied or impeded by exclusive
    arrangements that apply copyright-like restrictions on the use or
    redissemination of government information. Republication of government
    information is the right of all citizens, and no obstacles should be
    placed in the way of that right.
                AREAS OF REFORM:
        Legislation must guarantee the public's fundamental right to
    government information. Providing for the dissemination of and access
    to government information is an affirmative responsibility of every
    entity of the federal government. The definition of ``government
    information'' under Title 44 should include information from all
    government agencies, military agencies, independent regulatory
    agencies, government corporations, government-controlled corporations,
    and other establishments in the executive, legislative, or judicial
    branches of the federal government, as well as information created,
    compiled, or published under government contract.
        Legislation must provide for the availability or dissemination of
    information in the most appropriate format(s). The format of
    dissemination must take into account the use of the information and the
    reliability of the format over time. Legislation should provide for
    multiple formats for some types of government information to meet
    users' needs and ensure the integrity, long-term preservation and
    permanent public access to the information.
        The definition of ``government information'' to be made available
    to the public and included in the depository program must include all
    information, regardless of form or format, which is created or compiled
    by employees of a component of the government, or at government
    expense, or as required by law, except that which is required for
    official use only, is for strictly administrative or operational
    purposes having no public interest or educational value, or is
    classified for reasons of national security.
        Legislation must clarify the definition of ``government
    information'' to explicitly include electronic information products and
    services. The definition of government information must include the
    broadest possible array of publicly funded information of public
    interest or educational value and should not be limited only to those
    materials originally intended for public dissemination (e.g., sales
    publications, brochures).
        Legislation must specify that agency information products and
    services, including those developed under a fee-based mandate or
    statute, must be made available to the public at no fee through
    depository libraries. Legislation should ensure that access to
    government information is not hindered by exclusive arrangements that
    apply copyright-like restrictions on use or redissemination of
    government information.
        Legislation must ensure that, regardless of any other agreements or
    mandates, government information created or compiled at taxpayer
    expense must be made available to the public at no fee through
    depository libraries. This includes: government information accessible
    only through government contracts with private commercial services;
    cooperative publications, or government information created, compiled,
    or disseminated through contracts, cooperative research and development
    agreements, or other formal arrangements.
    GOAL 2: The law must strengthen the role of the Superintendent of
            Documents and the Federal Depository Library Program in
            providing public access to government information.
                PRINCIPLES:
        The government must provide a strong, centralized, coordinated, and
    managed program that provides for the acquisition, bibliographic
    control, dissemination, and long-term public access of government
    information at no cost to the public through depository libraries.
        To facilitate broad public access to electronic government
    information, the government must develop, adopt, and utilize
    government-wide standards for the production, dissemination, and access
    to government information in electronic formats.
                AREAS OF REFORM:
        Legislation should strengthen the Federal Depository Library
    Program, the Superintendent of Documents Sales Program, and the GPO
    Access online service as essential mechanisms for ensuring public
    access to government information. [To reflect the impact of electronic
    technologies on public access, the name of the FDLP should be changed
    to the ``Federal Depository Library and Public Access Program.'']
        The law must unequivocally state that electronic information be
    made publicly available and included in the FDLP.
        Library services included in the FDLP must span the entire life-
    cycle of government information (creation, dissemination, access, use,
    preservation, and evaluation) and include: cataloging and bibliographic
    control; administration of access to online electronic information
    products; distribution of physical publications and tangible electronic
    products; preservation and permanent public access; development of
    standards; training; feedback and participation in the design and
    evaluation of government information products and services; and other
    services that enhance public access to government information. These
    services must be centrally coordinated to facilitate public access and
    to meet most effectively the needs of libraries and the public.
        Legislation must provide the statutory basis for appropriations for
    broad public access to government information. This includes the
    distribution of physical publications to depository libraries at no
    charge, and to all others at no more than the incremental cost of
    printing and distribution. Likewise, electronic access to government
    information should be provided at no fee to the broadest possible
    audience; in cases where access fees are required, no-fee access must
    be guaranteed to the public through depository libraries. Adequate
    appropriations to the FDLP must be included to provide depository
    libraries with copies of publications and access to online databases.
    The Superintendent of Documents should be empowered to reimburse
    publishing agencies at the incremental rate for replicating depository
    copies of tangible products. Appropriations must cover the costs of
    producing and disseminating products through the FDLP as well as any
    costs for software licenses that accompany electronic products.
        Legislation must make it clear that regardless of any other legal
    or administrative requirements, government information must be made
    accessible to the public through the FDLP; specifically, an agency's
    mandate to recover costs does not relieve it from fulfilling its
    depository obligations under Title 44.
        Legislation must provide for a centrally managed procurement and
    production system for government information products and services.
    Such a system should facilitate the identification of information
    products for inclusion in the FDLP. It is essential also that the
    system provide for appropriate penalties and enforcement power to
    ensure agencies' compliance with their FDLP obligations under Title 44.
        Legislation must require that each branch of government develop a
    standardized system to describe their electronic information products
    and services at the database level (e.g., GILS/Government Information
    Locator Service) in consultation with the national libraries and the
    judicial branch libraries. These records should provide interactive
    links to online databases and information resources.
        Legislation should provide for the utilization of advisory
    council(s) that include members from all three branches of government,
    librarians, and the public.
    GOAL 3: The law must establish the affirmative responsibility of the
            federal government to preserve and provide permanent public
            access to its information, and to ensure the authenticity of
            government information.
                PRINCIPLES:
        The government has an affirmative obligation to guarantee: the
    preservation of government information to ensure its availability for
    future generations; permanent public access to government information;
    and authenticity and integrity of its information to ensure that it is
    ``official.''
                AREAS OF REFORM:
        Legislation must provide for the central coordination of permanent
    public access to government information. The federal government,
    including the Superintendent of Documents working in cooperation with
    the federal agencies, the National Archives and Records Administration,
    the Library of Congress and other national libraries, depository
    libraries, and other library partners, must be responsible for
    establishing and maintaining a system of permanent public access to all
    formats of government information. Implementation of this should
    include a distributed system that provides for adequate redundancy and
    is based on official/contractual agreements between partners. The
    Superintendent of Documents should be responsible for coordinating and
    overseeing the formal contracts and interagency agreements that ensure
    the preservation and permanent public access to government information.
        Legislation must account for the public's need to be assured that
    the information that the government provides is authentic. Policies and
    practices should provide for ``official'' versions of government
    information on which the public can rely in conducting its business and
    affairs.
    GOAL 4: The law must resolve the constitutional or inter-branch issues
            regarding the oversight and administration of the life-cycle of
            government information (creation, acquisition, production,
            bibliographic control, dissemination, and permanent public
            access) to establish clear accountability and facilitate public
            access to government information from the legislative,
            executive, and judicial branches.
                PRINCIPLES:
        Congress must continue to provide effective oversight in a manner
    that will ensure that the executive, legislative, and judicial branches
    of government comply with the principles of public access.
                AREAS OF REFORM:
        Legislation must provide for strong congressional oversight of
    government information policies and practices and the power to effect
    government-wide standards that facilitate public access. Legislation
    should underscore the important role of Congress in providing public
    access to government information. As the branch of government closest
    to the people, Congress must ensure local access to federal government
    information nationwide.
        Legislation must provide enforceable compliance mechanisms for
    procurement and production systems. Enforcement authority should be
    established encompassing all three branches of government to ensure
    compliance with the public access and dissemination requirements of the
    law.
        Legislation must include incentives for agencies and libraries to
    participate in the depository program. Statutory authority should be
    provided to ensure agency participation in programs designed to
    facilitate and provide public access to government information.
         document of the inter-association working group on government
                               information policy
        The Inter-Association Working Group on Government Information
    Policy is a cooperative team of representatives from several major
    library associations working to enhance public access to government
    information through the revision of U.S.C. Title 44. Together, these
    associations represent more than 80,000 librarians, information
    specialists, library trustees, libraries, and others interested in
    library issues.
        For more information, please contact: Francis Buckley, IAWG Chair;
    Director, Shaker Heights Public Library, 216/991-2030 or
    francis.buckley@shpl.lib.oh.us.
        Mary Alice Baish, American Association of Law Libraries, 202/662-
    9200 or baish@law.georgetown.edu.
        Anne Heanue, American Library Association, 202/628-8410 or
    aah@alawash.org.
                           GOVERNMENT PRINTING OFFICE

    STATEMENT OF MICHAEL F. DiMARIO, PUBLIC PRINTER
    ACCOMPANIED BY:
            WAYNE P. KELLEY, SUPERINTENDENT OF DOCUMENTS
            WILLIAM M. GUY, BUDGET OFFICER
            CHARLES C. COOK, SUPERINTENDENT, CONGRESSIONAL PRINTING
                MANAGEMENT DIVISION

                           introduction of Associates

        Senator Bennett. For this next panel we welcome Michael
    DiMario, the Public Printer, and he is accompanied by Wayne
    Kelley, the Superintendent of Documents from the Government
    Printing Office.
        I have no opening statement.
        Senator Dorgan, do you?
        Senator Dorgan. Nor do I, Mr. Chairman.
        Senator Bennett. Fine. We will go directly to our
    testimony.
        Mr. DiMario. Thank you, Mr. Chairman. Also with me is Mr.
    Bill Guy, who is our budget officer.
        Senator Bennett. I'm sorry. I apologize. I was not looking
    in this direction.
        Mr. DiMario. Mr. Guy sits to my left. We also have Mr.
    Charles Cook, who is the head of our Congressional Printing
    Management Division, who is in the audience but is available to
    us.
        Senator Bennett. Thank you.
        Mr. DiMario. In the interest of time, I will briefly
    summarize my prepared statement which has been submitted for
    the record.
        Senator Bennett. Without objection, it shall be included in
    the record.

                           Public Printer's statement

        Mr. DiMario. Mr. Chairman, I deeply appreciate the time you
    took from your busy schedule recently to visit GPO and observe
    our operations. We look forward to working with you through the
    subcommittee. We also invite other members of the subcommittee
    to come down and visit, to see our operation, because I think
    that is an important aspect of understanding what we do.
        For fiscal year 1998 we are requesting a total of $114.5
    million for those programs requiring annual appropriations
    directly to GPO. This includes $84 million for the
    congressional printing and binding appropriation and $30.5
    million for the salaries and expense appropriation for the
    Superintendent of Documents.
        The total amount we are requesting is an increase of $3.8
    million, or 3.4 percent, over the funding approved in fiscal
    year 1997.
        For congressional printing, we are seeking $2.4 million
    more than was approved this year due to workload increases
    anticipated for the second session of the 105th Congress as
    well as cost increases due to employee pay and expenses for
    supplies, utilities, and maintenance.
        For the Superintendent of Documents salaries and expenses
    appropriation, we are requesting $1.4 million more to fund
    unavoidable cost increases as well as the continued
    transformation of the Depository Library Program to an
    electronic basis.
        My prepared statement includes information on GPO's mission
    and programs to assist you in your review of our appropriations
    request.
        I specifically want to direct your attention to the fact
    that our use of electronic printing and information
    technologies over the past two decades has generated
    substantial savings for Congress and the taxpayers while
    improving public access to congressional and other Government
    information.
        Twenty years ago, our congressional printing budget was the
    equivalent of $209.5 million in today's dollars. Today our
    budget request is for $84 million, a reduction of nearly two-
    thirds. That reduction was achieved primarily through our
    utilization of successive generations of electronic printing
    and information technologies to serve Congress.
        A major outcome of the productivity improvements generated
    by these technologies has been an ability to downsize our
    operation significantly. Since the mid-1970's, our work force
    has been reduced by more than 55 percent, from over 8,200
    employees to the current 3,626 employees.
        We are continuing to manage downsizing to achieve savings
    without interrupting critical services to Congress and the
    public. Our use of electronic technologies means that Congress
    can achieve improved information services for its own use and
    for public access. The GPO infrastructure supporting Congress
    is capable of receiving congressional data in electronic format
    in order to reduce production costs. Already we are receiving
    more than 60 percent of Congressional Record copy from the
    Senate in electronic format.
        We provide the necessary standardization of congressional
    information products as well as the systems for widespread
    public dissemination of this important information. We are
    prepared to assist the Senate and the House in electronically
    disseminating committee materials and we have a pilot program
    for online access to committee hearings.
        Our GPO Access online service currently averages more than
    4 million document downloads per month. Now we measure this
    differently than the Library of Congress does. They are
    measuring hits on their system. We are measuring actual
    downloads of documents. So that is an important distinction.
    GPO Access provides widespread public access to congressional
    and other Government documents.
        We are successfully moving our Depository Library Program
    toward a predominantly electronic basis as originally directed
    by this subcommittee. Altogether, GPO's systems and services
    are dedicated to supporting Congress' move to increase
    utilization of electronic formats. We have the resources and
    experience to help make the cyber-Congress a reality.

                               prepared statement

        Mr. Chairman, this concludes my opening remarks. I would be
    pleased to answer any questions the subcommittee may have. And
    I would submit my formal statement for the record.
        [The statement follows:]
                    Prepared Statement of Michael F. DiMario
        Mr. Chairman and Members of the Subcommittee, I am pleased to be
    here today to present the funding requirements of the Government
    Printing Office (GPO) for fiscal year 1998. In addition to our funding
    request, I am also providing additional information on GPO's mission
    and programs.
                    fiscal year 1998 appropriations request
        For fiscal year 1998, we are requesting $114.5 million for those
    programs that require annual appropriations directly to GPO. This is an
    increase of $3.8 million, or 3.4 percent, over the funding approved for
    fiscal year 1997. However, it is also $1.2 million, or 2.6 percent,
    less than the amounts appropriated 5 years ago. The request includes
    $84 million for the Congressional Printing and Binding Appropriation
    and $30.5 million for the Salaries and Expenses Appropriation of the
    Superintendent of Documents. The increase is due primarily to general
    price level increases, although for congressional printing there are
    also workload increases in various product categories that are typical
    for a second session of Congress.
                           gpo's appropriated funding
        Unlike the other agencies that come before this Subcommittee, only
    a small part of our annual budget is appropriated directly to GPO. Our
    budget instead is financed through a businesslike revolving fund, which
    is reimbursed by payments from customer agencies, sales to the public,
    and transfers from our appropriated funds. For fiscal year 1996, the
    total operating expenses charged against our budget were $835.4
    million. Appropriated funds from Congress provided $113.7 million of
    this amount, or 13.6 percent. They included $82.4 million for
    Congressional Printing and Binding and $31.1 million for the Salaries
    and Expenses of the Superintendent of Documents. All other GPO
    activities were financed through the revolving fund by customer agency
    payments and revenues from sales to the public. Each year, in addition
    to our appropriations request, we request congressional authorization
    for operation of the revolving fund.
        The Congressional Printing and Binding Appropriation is critical to
    the maintenance and operation of our inplant printing capacity, which
    is structured to serve Congress's printing needs. The appropriation
    covers the costs of congressional printing, such as the Congressional
    Record, bills, reports, hearings, documents, and other products. Each
    year, a substantial volume of this work is requisitioned by Congress.
    In fiscal year 1996, nearly 2 billion copy pages of congressional
    products were produced at an average cost of about 4 cents per page,
    inclusive of all prepress (database preparation) work, printing,
    binding, and delivery.
        The majority of the Superintendent of Documents Salaries and
    Expenses Appropriation is for the Federal Depository Library Program
    (FDLP). While some of the funding for this program is for salaries and
    expenses, the majority is for printing and distributing publications
    (including publications in CD-ROM and online formats) to depository
    libraries. As long as Federal publications meet the requirements for
    depository distribution established by law, the copies must be
    distributed. In this sense, the volume of this work is controlled by
    the publishing activities of Federal agencies and Congress.
                congressional printing and binding appropriation
        Our request of $84 million for the Congressional Printing and
    Binding Appropriation is an increase of $2.4 million, or 2.9 percent,
    over the amount approved for fiscal year 1997. However, it is $5.6
    million, or 6.2 percent, less than the amount appropriated 5 years ago,
    without adjusting for inflation. Of the total request, $21.2 million,
    or 25 percent, is for the Congressional Record, including the Index and
    the permanent edition. Hearings constitute the second largest component
    of our request, totaling $17.1 million, or 20 percent. Legislative
    bills together total $11 million, or 13 percent.
        Estimated Requirements and Workload.--Based on historical data, in
    the second session we expect to see increases in certain categories of
    work, such as Congressional Record pages, but decreases in other
    categories, such as hearings. Overall operating costs are anticipated
    to increase marginally due to the increased cost of employee pay and
    benefits, utilities, maintenance, materials, and supplies. We will
    continue to work to offset these increased costs with savings from
    technological improvements and adjusting staffing requirements.
        The most significant price level changes anticipated are for the
    production of the Congressional Record, where due to cost decreases
    associated with improved production processes and the increased
    submission of Record text electronically from Congress, we anticipate a
    3.5 percent reduction in costs for data preparation. In most other
    product categories, we anticipate marginal price increases to recover
    the cost of current services, although most of the increases are at or
    below the rate of inflation. Altogether, price changes account for
    approximately $.7 million of the requested $2.4 million increase.
        We anticipate workload volume increases during the second session
    for Congressional Record pages, committee reports, business and
    committee calendars, bills, document envelopes and franks, and
    documents. We anticipate workload reductions for committee prints,
    hearings, miscellaneous publications (since there will be no printing
    of the Congressional Directory and other publications in the second
    session), miscellaneous printing and binding (such as letterheads and
    envelopes), and details to Congress based on trends for reduced
    requirements.
                 study on privatizing the congressional record
        In the House report accompanying the Congressional Printing and
    Binding Appropriation for fiscal year 1997 (H. Rpt. 104-657), we were
    required to conduct a study, using independent outside experts, to
    determine if opportunities exist for outsourcing the Congressional
    Record and the Federal Register. This requirement was based on the
    rationale, as provided in the report, that ``the Congressional Record
    and the Federal Register workloads are somewhat predictable and
    sufficiently routine so that it may be possible that one or both
    products can be outsourced'' (pp. 28-29). The report also directed us
    to consider the option of converting to a two-shift operation in GPO's
    printing plant.
        The Chairman of the JCP has suggested that anticipated reforms to
    Title 44 may diminish the need for such a study at this time, and that
    the rapid evolution of technology may impact the need for this study. I
    concur. Technology initiatives in both the Senate and the House may
    result in changes to the operations for the production of the
    Congressional Record. It may not be possible at this time to accurately
    project all of the technology developments and procedural changes that
    might result from these plans.
        In addition, the basic premise behind the requested study--that the
    workloads for the Record and the Register are ``somewhat predictable
    and sufficiently routine''--is not wholly accurate. As I have testified
    many times, these workloads are in fact far from predictable and
    routine; the Record one night may be 20 pages long, and the next night
    400 pages, necessitating daily workload scheduling and production
    changes. These variances are at the heart of the reason why the Record
    and the Register are produced in GPO, and not contracted out. I believe
    what the study is likely to conclude is this very point, at a
    potentially significant expense to the taxpayers.
                      salaries and expenses appropriation
        Our request of $30.5 million for the Salaries and Expenses
    Appropriation of the Superintendent of Documents is an increase of $1.4
    million, or 4.8 percent, over the amount approved for fiscal year 1997.
    The increase is primarily due to price level increases and pay raises
    and related costs. Of the total request, $25.9 million, or 85 percent,
    is for the FDLP; $3.6 million, or 12 percent, is for the Cataloging and
    Indexing Program; $555,000, or 2 percent, is for International
    Exchange; and $486,000, or 1 percent, is for distribution of
    publications to recipients required by law.
        Estimated Requirements and Workload.--Price level changes and cost
    increases due to pay raises and related expenses represent $858,000, or
    about 62 percent, of the requested increase of $1.4 million. The
    majority of this amount, $631,000, is for price level changes
    calculated at the assumed rate of inflation for the year (2.7 percent).
    The remaining $526,000, or 38 percent, of the requested increase is for
    program changes related to workload, including improvements to GPO
    Access in order to continue the transition of the FDLP to an electronic
    basis. We are projecting a decreased number of paper copies distributed
    to depositories, staffing reductions due to increased efficiencies, and
    other program cost reductions.
                      gpo's mission in the information age
        An abiding commitment to public access to Government information is
    deeply rooted in our system of Government. GPO is one of the most
    visible demonstrations of that commitment. For more than a century, our
    mission under the public printing and documents statutes of Title 44 of
    the U.S. Code has been to fulfill the needs of the Federal Government
    for information products and distribute those products to the public.
    Formerly, our mission was accomplished through the production and
    procurement of traditional printing technologies. However, a generation
    ago we began migrating our processes to electronic technologies, and in
    1993 Congress amended Title 44 with the GPO Electronic Information
    Access Enhancement Act (Public Law 103-40) to require us to disseminate
    Government information products online. This Act is the basis of GPO
    Access, our Internet information service.
        Today, GPO is dedicated to producing, procuring, and disseminating
    Government information products in a wide range of formats. In GPO the
    Government has a unique asset that combines a comprehensive range of
    conventional production and electronic processing services, procurement
    facilitation, and multi-format dissemination capabilities to support
    the information life cycle needs of Congress, Federal agencies, and the
    public.
        We provide printed and electronic information products and services
    to Congress and Federal agencies through inplant processes and the
    purchase of information products from the private sector. In fact, we
    buy approximately 75 percent of all information products requisitioned
    from us in one of the Government's most successful procurement
    programs. We disseminate Government information through a low-priced
    sales program and to Federal depository libraries nationwide where the
    information may be used by the public free of charge. We also
    disseminate a growing volume of information via the Internet. We
    catalog and index Government information products, and we distribute
    them on behalf of other Federal agencies. Information on all of our
    programs and services, as well as access to a large and growing range
    of Government information, is available through our home page on the
    World Wide Web, at http://www.gpo.gov.
        We conduct all of our services in a non-partisan, service-oriented
    environment that emphasizes the primacy of the customer's requirements
    for timeliness, quality, security, and economy, and we are committed to
    achieving the greatest access and equity in information dissemination
    whether through printed publications, CD-ROM, or online. At the bottom
    line, our programs reduce the need for duplicative and costly
    production facilities throughout the Government, achieve significant
    taxpayer savings through a centralized procurement system, and enhance
    public access to Government information.
                                gpo and congress
        GPO was originally established to provide Congress with immediate,
    reliable service in a work environment under its direct control. That
    mission continues today. We produce the daily and permanent editions of
    the Congressional Record, bills, committee and business calendars,
    hearings, committee reports, committee prints, documents, stationery,
    and a wide variety of other products that are essential to the
    legislative process in Congress. We produce this work in our central
    office facility on North Capitol Street in Washington, DC, through the
    creation and storage of electronic databases of publications for
    printing and dissemination, as well as the provision of CD-ROM, online
    access, and print-on-demand services. All of this work is funded
    through an annual appropriation for Congressional Printing and Binding.
        Our Congressional Printing Management Division (CPMD) serves as
    GPO's liaison with the Congress for printing and information product
    needs. CPMD staff provide assistance to Members and officials of
    Congress as well as committees and support staffs regarding the
    printing and electronic availability of congressional information
    products. The CPMD is also responsible for managing approximately 59
    GPO employees detailed to congressional committees and offices to
    assist with printing requirements. To ensure the timely delivery of
    printed materials, there are 19 congressional receiving clerks, who are
    part of the CPMD staff, assigned to congressional buildings. In
    addition, the CPMD coordinates and maintains distribution lists for all
    agency requests for congressional products.
        Support for the Cyber-Congress.--We have built a core capability
    for electronic information and communications services to support
    Congress's information needs. Today, our state-of-the-art electronic
    systems are characterized by a complex of direct electronic linkages
    via CAPNET to a variety of congressional offices on Capitol Hill for
    data interchange. Once considered only the by-product of the print
    production process, digitized electronic databases of congressional
    information are now the primary product: they are the databases from
    which the official versions of documents are produced in print, CD-ROM,
    and online access formats and made available to the public through GPO
    Access, as well as other systems such as the Library of Congress's
    THOMAS information system.
        Our electronic systems and staff expertise position us to continue
    supporting the development of the cyber-Congress, including the
    proposed Legislative Information System for the Senate and a comparable
    House Document Management System. We are committed to supporting
    Congress's effort to provide more committee materials online to the
    public.
        More than 60 percent of Congressional Record files from the Senate
    are currently submitted electronically. We are currently working with
    the Senate Appropriations Committee to provide online dissemination of
    appropriations hearings. We operate a print-on-demand system in the
    Senate Document Room that has reduced the requirement for printing
    extra copies of legislative products, eliminating the need for storage
    space and providing for effective future distribution. This system, and
    another print-on-demand system located at our central office facility,
    are both networked to congressional databases resident at GPO.
        Advantages from Electronic Support.--Our electronic systems provide
    a standardized system for use by both Houses of Congress, resulting in
    compatibility of production processes and uniformity in the resulting
    products. They provide for the interchangeable use of databases to
    produce different congressional publications, generating significant
    savings. Our systems are a centralized resource where production and
    dissemination equipment and staffing can be concentrated, yielding
    significant economies of scale. Finally, they facilitate both
    production and dissemination. Databases prepared for printing are
    easily converted into databases suitable for CD-ROM distribution and
    for online dissemination via the Internet to libraries, schools,
    offices, and homes nationwide and around the world.
        Savings from the Use of Technology.--Productivity increases
    resulting from technology have enabled us to make substantial
    reductions in staffing requirements while continuing to improve
    services for Congress. In the mid-1970's, on the threshold of our
    conversion to electronic photocomposition, we employed more than 8,200
    persons. Today, we have 3,626 employees on board, fewer than at any
    time in this century. In the past 4 years our staffing has been reduced
    by 25 percent. The reduction was accomplished while at the same time
    modernizing and improving our services.
        Electronic technologies have significantly reduced the cost, in
    real economic terms, of congressional publications. In fiscal year
    1978, the appropriation for Congressional Printing and Binding was
    $84.6 million, the equivalent in today's dollars of $209.5 million. By
    comparison, our approved funding for fiscal year 1997 is $81.7 million,
    a reduction of nearly two-thirds in real economic terms. This has
    yielded a savings to the taxpayer of well over $100 million per year.
    The vast majority of the reduction is due to productivity improvements
    and staffing reductions made possible through the use of improved
    technology.
                            gpo and federal agencies
        GPO's Printing Procurement Program.--Approximately 75 percent of
    the printing and information products requisitioned from GPO are
    procured from the private sector. GPO historically has retained for
    inplant production only work which cannot be procured on a controlled,
    timely, and cost-effective basis. The vast majority of the work
    procured from the private sector is for Federal agencies in the
    executive branch. We provide procurement services through our central
    office facility and through a network of 20 regional and satellite
    procurement offices nationwide. All work for Federal agencies is paid
    for by the agencies themselves. The payments are processed through
    GPO's revolving fund.
        Our printing procurement program saves a significant amount of
    money for the taxpayers. The program operates on a highly competitive
    basis, driving prices down. Approximately 10,000 firms--or about a
    quarter of the nationwide printing industry, representing nearly
    200,000 employees--are registered on GPO's Master Bid List according to
    their equipment, staffing, and production capabilities. About 3,500 of
    these firms do business with us on a regular basis, ensuring intense
    competition for Government printing and information product contracts.
        By consolidating the Government's specialized printing procurement
    skills and resources in GPO, agencies save money in their printing
    programs. Moreover, agencies achieve savings without giving up
    essential controls when they work through us. Most of our printing
    procurements are conducted through direct deal term contracts,
    permitting agencies to place their printing orders directly with the
    contractor. Our centralized program utilizes a service infrastructure
    that allows agencies to directly control the vast majority of their
    printing needs from the point of origination. Electronic versions of
    printing procurement bid solicitations are now accessible from the
    Internet via GPO's World Wide Web home page.
        CD-ROM Services.--Since 1988 we have been a leading Government
    producer of CD-ROM technology, providing agencies with a complete range
    of CD-ROM production services. We have received the annual CD-ROM Award
    from the Special Interest Group for CD-ROM Applications and Technology
    (SIGCAT), the largest CD-ROM user group in the world, in recognition of
    the CD-ROM services we provide. The General Accounting Office has cited
    our CD-ROM program as one of the most cost-effective in the Government,
    specifically noting that GPO's CD-ROM products are among the least
    expensive for users.
        World Wide Web Services.--For the World Wide Web, we provide
    database development services, mounting on our servers, database
    maintenance, access based on agency needs, promotion of the service,
    training, and user support. GPO Access features a unique service in
    making most databases available not only in ASCII format but in
    Portable Document Format (PDF), which provides a searchable database
    that exactly replicates the printed product.
        The New Commerce Business Daily.--We recently entered into an
    alliance with the Department of Commerce in the development of a new
    Commerce Business Daily (CBD). The new CBD has made it easier and more
    timely for agencies to electronically submit notices for inclusion in
    CBD, significantly reduced the cost per notice for these submissions
    (from $18.00 to $5.00), allowed for the continuation of a billing and
    reporting process for these charges, provided support to both agencies
    and users of the CBD, reduced the time necessary to typeset and compose
    the printed version, and enhanced the delivery of the final copy to the
    printing contractor for the production of the daily printed issues. It
    has also enabled commercial value-added providers who offer CBD
    products to receive the daily CBD information much faster, in an
    enhanced format, and at a 20 percent reduction in cost. On April 21,
    1997, our CBD partnership with the Commerce Department was the
    recipient of a ``Hammer Award'' from the National Performance Review.
        Inplant Services.--In addition to procuring printing for Federal
    agencies, GPO produces work in our central office plant and regional
    printing plant in Denver. A significant portion of the agency work
    produced inplant is associated with the Federal Register, and includes
    the List of Sections Affected and the Code of Federal Regulations.
    Other work includes U.S. passports, postal cards, the U.S. Budget, and
    other jobs that are performed by GPO due to concerns for cost,
    timeliness, and control over sensitive Government information.
        The continued need for GPO's regional printing plants has declined.
    In response, we have closed plants in Chicago, Seattle, San Francisco,
    and New York, and previously a separate printing and reproduction
    facility at the Washington, DC, Navy Yard was consolidated with GPO's
    central office facility. A facility in Alaska, transferred from the
    GSA, has also been closed. The remaining plant in Denver continues to
    satisfy regional production and security printing needs.
                       gpo and information dissemination
        The Printing Act of 1895, which is the basis for the public
    printing and documents statutes of Title 44 of the U.S. Code, relocated
    the Superintendent of Documents function from the Interior Department
    to GPO. By linking the authority for the distribution of documents with
    GPO's printing operations, Congress created an effective system for
    ensuring comprehensive public access to the publications produced by
    the Government. As the success of GPO Access demonstrates, this linkage
    continues to be an effective means for the development and
    dissemination of electronic databases in the Information Age.
        The information dissemination programs of GPO's Superintendent of
    Documents include the distribution of publications to approximately
    1,400 Federal depository libraries nationwide, cataloging and indexing,
    distribution to recipients designated by law, and distribution to
    foreign libraries designated by the Library of Congress which in turn
    agree to send copies of their official publications to the Library
    pursuant to international treaty. These programs are funded by the
    annual Salaries and Expenses Appropriation of the Superintendent of
    Documents.
        The Superintendent of Documents also operates a nationwide sales
    program. This program, the Government's single largest information
    dissemination network, operates 24 bookstores in major metropolitan
    areas around the U.S. as well as an extensive order service equipped to
    receive mail, phone, fax, and Internet-based orders for publications
    nationwide and worldwide. This program is funded entirely by revenues
    earned on sales of publications. The Superintendent of Documents also
    distributes publications for Federal agencies which reimburse us for
    comprehensive warehousing and dissemination services. Altogether, we
    distribute about 100 million copies of Government publications per year
    through these programs (not including information made available
    online).
        GPO Access.--GPO Access provides free access to more than 70
    Federal databases, including the Congressional Record, the Federal
    Register, the Commerce Business Daily, Supreme Court opinions,
    congressional bills and reports, and other publications, as well as
    Government Information Locator Service (GILS) records for a growing
    number of Federal agencies. The first online service of its kind
    established by Congress, GPO Access allows users to locate a wide
    variety of electronic products available via the Internet and to order
    Government publications online. GPO Access is the only Government
    online service providing access to a wide range of information from all
    three branches of the Federal Government, and the only service
    providing official access to this important Government information. In
    April 1997, retrievals topped 4.5 million. During peak usage periods
    there are more than 15,000 GPO Access sessions per hour.
        GPO Access has drawn praise from a variety of sources, including
    the library community (which gave GPO Access the 1995 James Madison
    Award), the Federal technology community, the legal community, and
    others. In December 1996, in a guest column in Roll Call,
    representatives of the Congressional Accountability Project and the
    Heritage Foundation together called GPO Access ``an enormous success.''
    In January 1997, OMB Watch released a report on Government Information
    Locator Services which noted that ``GPO Access has become the largest
    single location for GILS services and records in the Federal
    Government,'' and that ``GPO should be seen as an example to agencies
    that are struggling with their GILS implementation.''
                       federal depository library program
        Principles.--The dissemination of Government information to
    libraries for the use of the public began in 1813, making the FDLP
    America's oldest ``freedom of information'' program. From its
    beginning, the FDLP has been built on several underlying principles:
      --A well-informed citizenry, cognizant of the policies and activities
            of its representative Government, is essential to the proper
            functioning of democracy.
      --The public has a right to Government information which has been
            prepared and published at public expense.
      --The Government has an obligation to ensure the availability of, and
            access to, public information at no cost to the user.
      --The publications provided through the FDLP are a permanent and
            official source of Government information.
      --The public, participating libraries, and the Government all benefit
            from the efficiencies afforded by a centralized distribution
            system, such as the FDLP, which ensures the wide availability
            of Government publications at no charge to the user.
        Statutory Requirements.--Libraries are designated as depositories
    by Senators and Representatives as well as by law. Under the law, we
    send the libraries copies of all Government publications processed
    through GPO that are not purely of an administrative nature,
    cooperatively sponsored, or classified for reasons of national
    security. These copies are paid for by the annual Salaries and Expenses
    Appropriation of the Superintendent of Documents. If Federal agencies
    themselves produce publications that belong in the FDLP, they are
    required by law to pay for the production and distribution of those
    copies sent to the depositories. In return for receiving Government
    information products at no cost, the libraries must make them available
    to the public without charge and provide appropriate assistance to
    users.
        The majority of the depository libraries are selective depositories
    which tailor their Government publications acquisitions to local needs,
    choosing from among 7,000 organizational and series categories. Fifty-
    three libraries, or roughly one per State (depending on size and
    resources, some States have no regionals while others have more than
    one), are regional depositories that receive every publication
    distributed by the FDLP. They are required to retain permanently every
    Government publication they receive.
        Users.--Based on 1995 data, we estimate that 750,000 to 950,000
    persons use FDLP information each month. A 1989 study estimated a
    minimum of 670,000 depository users per month in academic and public
    libraries.
        Workload.--In fiscal year 1996, nearly 16.4 million copies of about
    57,000 titles were distributed to depository libraries in paper and
    microfiche. In addition, we distributed 639 titles in tangible
    electronic formats, mostly CD-ROM. All GPO Access databases and
    services are available to depository users. Our locator services point
    to an additional 971 agency titles, and there are 1,148 Monthly Catalog
    records hot-linked to agency Internet sites.
        Library Participation.--There are now 1,372 depository libraries,
    including the 53 regionals. Of these, 55 percent are academic
    libraries, making the FDLP a major component of the Nation's education
    and research programs. Another 20 percent are public libraries, 11
    percent are law school libraries, 6 percent are State libraries, 5
    percent are Federal agency libraries, and the remaining 3 percent are
    special libraries. All Federal depositories are now expected to offer
    public users access to computer work stations with a graphical user
    interface, CD-ROM capability, Internet connections, and the ability to
    access Government information via the World Wide Web. However, there
    are still some depositories which cannot fully handle all electronic
    Government information offerings.
        Continuing Justification for the FDLP.--The FDLP will continue to
    be needed even as Federal agencies put more information on the
    Internet. The FDLP, funded out of legislative branch appropriations, is
    the means by which Congress asserts its historical role in keeping the
    American public informed about the activities of the Government.
        Depository libraries have developed skills and collections based on
    the needs of their local constituents. This affords the public a local
    setting in which they can use Government information at no charge,
    regardless of whether they own or can operate a computer, and be
    assisted by trained Government information professionals.
        As authorized by Public Law 103-40, GPO creates a variety of
    electronic ``Pathway'' locator services, which enable users to identify
    and connect to agency electronic resources. Since these activities are
    funded by the FDLP appropriation, the locator services sponsored by the
    FDLP may be used at no cost by the public. Within our suite of locator
    services, the Monthly Catalog on the Web is unique in how it locates
    both physical items in depository libraries and agency products on the
    Internet.
        The FDLP is the vehicle which provides permanent public access to
    Government information. Copies of physical items are permanently held
    for public use in the regional depository libraries. GPO, acting in
    partnership with other Program stakeholders, including the National
    Archives and Records Administration and libraries which elect to
    participate, is leading an effort to ensure that agency Internet
    products are permanently retained and made accessible to the public.
        It will be many years, if ever, before all Government information
    is available electronically. In the meantime, it is essential to have a
    single program which is charged with acquiring and distributing the
    vast array of printed products which the Government produces. Neither
    libraries nor the public would be well served by having to contact
    scores of individual agencies for the information they need.
        Fugitive Documents.--Many publications produced by the Government
    fail to be included in the FDLP. Documents that belong in the Program,
    but which are excluded, are known as fugitive documents. Their absence
    from depository library collections impairs effective public access to
    Government information. While many studies of the fugitive document
    problem have been conducted, the exact number of publications that are
    not in the FDLP has been difficult to isolate. Sometimes administrative
    errors are made by GPO in document selection and distribution. Most
    commonly, however, documents become fugitives from the Program due to
    their production outside of GPO, such as in agency printing plants.
    There is also a growing number of fugitive documents due to increased
    agency use of electronic systems to produce and disseminate their own
    documents.
        Although no study has resulted in a definitive answer, we estimate
    that more than 50 percent of all tangible Government information
    products are not being made available to the FDLP. Of these, we
    estimate that there are about 55,000 scientific and technical documents
    and reports which are neither printed through GPO nor furnished by the
    issuing agencies to the FDLP as required by law. The issuing agencies
    do, however, provide either a printed copy or an electronic image file
    of each of these documents to the National Technical Information
    Service (NTIS) of the Department of Commerce.
        In fiscal year 1996, NTIS took in about 160,000 scientific,
    technical, and business-related titles, most but not all of which were
    published by the Government. We estimate that about 70 percent, or
    112,000, of NTIS's total intake belongs in the FDLP. Compared with the
    57,000 titles in the FDLP in fiscal year 1996, this leaves about 55,000
    fugitive titles which should have been provided to GPO by publishing
    agencies, had they fully complied with Title 44 requirements.
        In addition, there is an unknown number of fugitives which are
    primarily general, public interest materials produced by agencies other
    than through GPO. It is virtually impossible to estimate the total
    number of these titles, but they may well number in the thousands and
    include such publications as decisions of the Federal district courts
    and courts of appeals, Federal Election Commission financial disclosure
    statements, and reports produced by the Library of Congress's
    Congressional Research Service.
        Recently, four major factors have contributed to increasing losses
    of key general interest publications for the FDLP: (1) electronic
    information dissemination via agency web sites without notification to
    the FDLP; (2) decreasing compliance with statutory requirements for
    agencies to print through GPO or to provide copies of publications not
    printed through GPO to the FDLP; (3) the increasing trend for agencies
    to establish exclusive arrangements with private sector entities that
    place copyright or copyright-like restrictions on the products involved
    in such agreements; and (4) increasing use by agencies of language in
    44 U.S.C. 1903 that permits publications to be excluded from the FDLP
    if they are ``so-called cooperative publications which must necessarily
    be sold in order to be self-sustaining.''
        Fugitive documents defeat the purpose of the FDLP and undermine the
    public's ability to access information critical to their lives.
    Historically, the FDLP has relied heavily on the ability of the Program
    to automatically obtain material as it is produced or procured through
    GPO. With the growing emphasis on electronic dissemination, and
    decreasing compliance with statutory requirements for agencies to use
    GPO, identifying and obtaining information for the FDLP is becoming
    increasingly difficult.
        FDLP Compliance Issues.--When an agency uses GPO for production or
    procurement of a publication (defined in section 1901 as
    ``informational matter which is published as an individual document at
    Government expense, or as required by law''), GPO ensures that
    distribution is made through our own processes. If a publication is
    produced elsewhere than GPO, the publishing agency is required to
    supply the requisite number of copies to GPO, at its own expense, for
    dissemination to depositories.
        GPO is confronted with two kinds of compliance issues today. First,
    a number of Federal agencies are seeking new methods of printing
    information gathered at public expense. These methods do not involve
    GPO and, as a result, they impede or prevent effective public access to
    critical Government information. I have reported previously to Congress
    on several such instances, including such publications as Big Emerging
    Markets, U.S. Export Administration Regulations, and U.S. Industrial
    Outlook.
        Other efforts are ongoing by agencies that often involve allowing
    third parties to copyright the information or impose copyright-like
    restrictions on it. The result is that the information does not get
    produced or procured through GPO, and the agencies do not provide
    copies to GPO for distribution to depositories.
        A recent example of this is the Journal of the National Cancer
    Institute. For many years the National Cancer Institute (NCI) procured
    its Journal (JNCI), a major publication devoted to cancer research,
    through GPO and it was distributed to depository libraries. In January
    1997, however, the NCI notified GPO that it had signed a Cooperative
    Research and Development Agreement (CRDA) with Oxford University Press,
    under which ``the name of the publication will be retained, and Oxford
    will assume all responsibility for printing the Journal and will hold
    copyright to the Journal's content''. According to the letter received
    by GPO, the JNCI ``has been privatized, and effective January 1, 1997,
    ownership of the Journal will be transferred from the National Cancer
    Institute to Oxford University Press-USA, Inc.'' The letter also stated
    that ``[b]ecause the Journal is no longer a publication of the U.S.
    Government, copies of the Journal and JNCI Monographs will not be
    provided to the Depository Library Program nor will sales copies be
    available at the GPO bookstore.'' At the time of this notification, GPO
    was receiving 827 copies of each issue of JNCI for distribution to
    depository libraries. We have no further information on the terms and
    conditions of the CRDA between NCI and Oxford University Press because
    the NCI's legal counsel has informed us that the details of the CRDA
    are not public information.
        The second compliance issue involves publications in electronic
    formats. Several agencies have taken the position that Title 44 does
    not apply to Government information in electronic formats. OMB's
    Circular No. A-130, ``Management of Federal Information Resources,''
    requires agencies to cooperate with GPO for print publications, but
    only ``encourages'' cooperation for publications in electronic formats
    and provides agencies with a rationale for exempting electronic
    information products from the FDLP based on cost.
        An example of this is our recent experience with the NTIS Order Now
    CD-ROM. NTIS recently converted its printed sales catalog to a
    quarterly CD-ROM subscription called Order Now. NTIS did not procure
    this product through GPO. Although NTIS makes this catalog available
    online on a no-fee basis to depository libraries, the online product
    does not include the two years' worth of abstracts and indexes
    available on the CD-ROM. This makes the CD-ROM more complete and useful
    than either the online or former printed products. NTIS expressed a
    willingness to make the CD-ROM available as a benefit to the public and
    as a promotional tool for their sales program, provided GPO pays the
    retrieval software licensing fees. After due consideration, it was
    decided that the Superintendent of Documents could not pay these fees,
    and that since the CD-ROM was not procured through GPO, NTIS was
    obligated to provide copies to the FDLP under section 1903 of Title 44.
    In a letter to the Staff Director of the JCP concerning this matter,
    NTIS made the statement that ``[a]t no time did we consider this to be
    a question of compliance with Title 44,'' apparently based on the fact
    that the publication in question is electronic rather than print.
    However, without the NTIS Order Now CD-ROM, it will be more expensive
    for depository libraries to locate and purchase scientific and
    technical documents. More broadly, such attempts to evade the
    requirements of Title 44 represent a serious challenge to free public
    access to Government information through the FDLP.
        We believe that the spirit and intent of the law since the FDLP's
    founding in 1813 has been to make information produced at taxpayer
    expense available to the public through depository libraries regardless
    of format. In a 1990 opinion, GPO's General Counsel stated, ``[i]t is
    our opinion that Congress did not intend to carve a distinction based
    upon the technology employed to disseminate the Government publication
    and that Title 44 U.S.C. Sec. 1903 governs regardless of whether the
    publication is in the traditional ink-on-paper format or some new
    medium.'' Congress itself created GPO Access in large part to provide
    for online dissemination of Government information to depositories.
    While we make every effort to work closely with agencies to ensure the
    inclusion of their information products in the FDLP in all formats, the
    continuing agency practice of not providing electronic products to the
    FDLP is creating gaps in information availability to the public.
        Transitioning the FDLP to a More Electronic Basis.--In spite of the
    contention that electronic information products are not required to be
    included in the FDLP, Congress has encouraged us to transition the
    Program to a more electronic basis. The Legislative Branch
    Appropriations Act for Fiscal Year 1996 required GPO to conduct a study
    to identify measures necessary for a successful transition to a more
    electronic FDLP. In response to direction from Congress for broad
    consultation, GPO formed a group comprising representatives from GPO,
    the JCP, the Senate and House Appropriations Committees, the Senate
    Rules and Administration Committee, the House Oversight Committee, the
    House Government Reform and Oversight Committee, OMB, the Congressional
    Research Service of the Library of Congress, the National Archives and
    Records Administration, Federal publishing agencies, the Administrative
    Office of the U.S. Courts, the depository library community, and
    others. The final report, titled ``Study to Identify Measures Necessary
    for a Successful Transition to a More Electronic Federal Depository
    Library Program,'' was submitted to Congress in June 1996.
        Study Conclusions.--Two major conclusions emerged from the study.
    The first was strong support for retaining the authority for a broad-
    based public information program in the legislative branch. High value
    was placed on the presence of the FDLP in every congressional district
    to directly serve the public in local library settings.
        There was also strong support for having a single entity in the
    Superintendent of Documents to coordinate library-related information
    dissemination activities. The depository library community has
    consistently affirmed the utility and cost-effectiveness of a ``one
    stop shopping'' approach to acquiring Government information. The study
    participants agreed that it is not only possible but desirable to
    increase the dissemination of electronic information to depository
    libraries within the overall structure of current law and program
    operations, and that having a central entity to assist libraries and
    the public in accessing electronic Government information in a
    distributed environment is more vital now than ever.
        Strategic Plan.--The Strategic Plan included in the final Study
    Report proposes a gradual transition during the period fiscal year
    1996-2001. Under the plan, the FDLP will provide official Government
    information products in a variety of formats to depository libraries.
    Incorporating electronic Government information into the FDLP will
    augment the traditional distribution of tangible products with
    connections to Government electronic information services such as
    Internet sites. Electronic information will be accessible to the public
    directly or through depository libraries from a system of Government
    electronic information services administered by GPO, other Government
    agencies, or institutions acting as agents for the Government. The FDLP
    will identify and connect users to electronic information services of
    other agencies or, when appropriate, obtain electronic source files
    from agencies for mounting on GPO Access. Tangible Government
    information products will be distributed to libraries, including CD-
    ROM's, diskettes, paper, or microfiche, as appropriate to the needs of
    users and intended usage.
        The FDLP will ensure that electronic Government information
    products are maintained for permanent public access, in the same spirit
    in which regional depositories provide permanent access to print
    products. Effective public use of Government information, especially in
    the less-structured environment of the Internet, also depends on the
    ability of users to identify and locate the desired information.
    Through continuation of its cataloging services, and the development of
    ``Pathway'' information locator services, the FDLP will meet this need.
        Mr. Chairman and Members of the Subcommittee, this concludes my
    prepared statement, and I would be pleased to answer any questions you
    may have.

                              Financial management

        Senator Bennett. Thank you very much. We on the committee
    want to commend the GPO for your ongoing efforts to improve
    financial management operations. We understand you now produce
    financial statements that can be audited and that for years you
    have received a clean opinion on those statements.
        Mr. DiMario. Yes, sir.
        Senator Bennett. Further, you have committed yourself to
    comply with the goals and objectives of the Legislative Branch
    Financial Managers Council, and that includes adopting the
    Federal Government's accounting and internal control financial
    system standards. That will help us in our goal to get
    auditable statements, consolidated financial statements for the
    entire legislative branch. It is a continuing source of
    amazement and frustration to me, coming from the business
    community to Government, to discover that there are no
    auditable financial statements in many areas of Congress.
        We hope to continue our good working relationship with you
    and in conjunction with the Joint Committee on Printing, your
    authorizing committee, to see if we can find other ways to
    further refine the internal operations.

                               Year 2000 problem

        You were here in the room and heard our conversation about
    the year 2000 problem with the Library of Congress. As Chairman
    Stevens said, the year 2000 problem basically divides the old
    computer people with programs written in Cobol from the new
    computer people. The new computer people say it's no problem at
    all, we can fix it in a matter of an hour or so. But the old
    computer people say hundreds of millions of dollars and 2 years
    is not enough.
        How many of your computer systems are Cobol dependent and,
    therefore, subject to panic? Do you anticipate any specific
    dollar figure to remedy this?
        Mr. DiMario. At this point in time, we are in the process
    of working on the problem. We have compiled an inventory of
    computer applications which will be affected by the turn of the
    century. Some of our applications and data bases have been
    identified for total replacement while others will be or are
    being modified to accommodate the date problem.
        GPO has acquired two off-the-shelf software packages to
    facilitate the changes and these packages have worked well with
    Cobol applications. However, we are still looking for a good
    package that will assist us in identifying changes to many of
    our older Cobol ALC programs, and natural programming code of
    Software AG's ADABASE data base management system, that need to
    be changed.
        We are doing all of that. But we are also changing the way
    we do business internally. We are planning to implement a
    client server environment utilizing Oracle and NT tools, and we
    are designing relational tables and populating them under
    Oracle and NT. As this effort progresses, we are moving toward
    data warehousing for the entire GPO.
        So at this point in time, we do not foresee major year 2000
    dollar impacts, but we are attempting to do it incrementally
    before that point in time so that we avoid those kinds of
    problems.
        Senator Bennett. How much money in the fiscal year 1998
    budget request is tied to this problem, the year 2000 problem?
        Mr. Guy. Our budget request is for the services that we
    provide to Congress, largely. Our other operations are funded
    through reimbursements from the agencies that we support and
    from sales to the public. So we would be recovering costs tied
    to the year 2000 problem indirectly through our overhead
    charges, which are allocated to all activities.
        Senator Bennett. But you don't have a single number in the
    budget for that?
        Mr. DiMario. No, sir.
        What we have is an appropriation request for congressional
    printing and binding. We are in the process currently and have
    acquired a specific server to accommodate the legislative
    branch, but we are absorbing those costs within the existing
    congressional printing and binding funding.

                             Revolving fund losses

        Senator Bennett. Your workload has been declining in recent
    years. You have been continually incurring losses--$21.8
    million in fiscal year 1994, $3 million in fiscal year 1995,
    $16.9 million in fiscal year 1996, and you are projecting
    losses for 1997. Do you have any plans to avoid losses in 1998?
        Mr. DiMario. We are continuing to reduce our costs and to
    attempt to avoid losses in that way. But the losses are
    generated largely because we do not have all the work flowing
    into the office that we had anticipated in a given time.
        As an example, we anticipated for this particular session
    of Congress a greater amount of work coming to us from Congress
    than we have received.
        Senator Bennett. Do we solve your problem by staying in
    later at night and giving bigger speeches?
        Mr. DiMario. Yes; to some degree. [Laughter.]
        Senator Bennett. But that may be self-defeating.
        Mr. DiMario. The funding that we request is based on our
    anticipated workload.
        Under our system of charges and accounting, if we do not
    have the work, then we will show a loss. What that means is
    that we will fund the activities in GPO not through the
    appropriation but through retained earnings that we have from
    previous years. That becomes a subsidy.
        So it is not a loss in the sense of going beyond an
    appropriation or something of that sort. We are actually under
    the appropriation and we have come back and accommodated that
    at the end of certain fiscal years by adjusting reimbursements
    to actual cost.
        With respect to fiscal year 1996, I might point out that of
    the $16.9 million that was the loss shown, $10 million of that
    was in our sales program. Mr. Kelley, being well aware of that
    problem, has attempted through a new planning structure to
    relieve that situation. We believe we will be in a break-even
    situation or slightly profitable one within the sales program
    by the implementation of this program. To a large degree, it
    focuses on controlling inventory. We have had excess inventory
    and we are trying to reduce the inventory, and we are trying a
    new procedure to accommodate that.
        Wayne may want to add to this.
        Senator Dorgan. If I may ask you, what kind of retainer
    exists that you can call upon? You indicated that when you
    exercise an operating loss, you can call upon some retained
    earnings.
        I'm sorry to interrupt, Mr. Chairman.
        Senator Bennett. Not at all.
        Mr. DiMario. We operate through a revolving fund, and when
    we have work, we have to reimburse the revolving fund based on
    the work that we do. The revolving fund over a period of time,
    40 years, had built up a reserve.
        Senator Dorgan. How much of that reserve now exists? I
    guess that was my question.
        Mr. Guy. The retained earnings is $85 million. That is used
    for several purposes. It is used for working capital,
    primarily, to fund the operation of the Government Printing
    Office. We have revenues of about $850 million a year and we
    need a certain amount of working capital because we produce the
    work, provide the services, and then we get paid.
        So most of that is tied up and necessary for the operation.

                               Billing practices

        Senator Bennett. I just have one further question relating
    to your response to Senator Dorgan.
        Under current practice, you have up to 3 years in which to
    bill for work. I found that a little surprising, that you can
    work until 3 years later to send a bill.
        Do you have a reason for this long billing period and does
    anybody complain about it?
        Just help me understand that, please.
        Mr. DiMario. There are complaints and we are attempting to
    deal with that issue by working out firm pricing arrangements
    with the agencies.
        But as a general rule, when agencies come to us or the
    Congress comes, if we are procuring work--and we procure about
    75 percent of our work--in the end we are dependent on knowing
    what that specific contract calls for.
        Senator Bennett. When you say you are procuring your work,
    what does that mean?
        Mr. DiMario. We buy the work through private sector
    contracts. We enter into contracts with contractors around the
    United States.
        Senator Bennett. My verb for that would be that we
    subcontract, not that we procure.
        Mr. DiMario. Yes, sir; we subcontract. If we were in the
    private sector, that is precisely what we would call it. We are
    subcontracting to these individuals and we are acting as a
    contractor to the agencies.
        Senator Bennett. OK.
        Mr. DiMario. In this process, we are dependent on the
    contractors providing invoices to us for their work under the
    contracts that are let. We, in turn, have to pay those
    contractors who may go back and forth.
        As a general rule, we do not bill the agency until the
    contractor is paid. We have started the practice--and it is
    totally within the law--because we have come to be cash short
    at times in this revolving fund, of advance billing the
    agencies. This provides us the money up front for the product
    that we are going to provide that we are billing for.
        That is accommodating the situation to a large degree. But
    there has been this past history of not billing for a
    substantial period of time. We have worked actively with our
    largest customer, the Department of Defense, to work on an
    acceptable structure in that regard.
        Do you have anything to add to that?
        Mr. Guy. Well, most of the work is billed promptly.
        Mr. DiMario. Right.
        Mr. Guy. Some of the jobs do take a while to complete and
    in some cases we will bill in advance. In other cases, we will
    wait until the job is actually delivered to the customer before
    giving the customer a final bill.
        Senator Bennett. Do you have any further questions?
        Senator Dorgan. Nothing further. Thank you.
        Senator Bennett. Thank you very much.
        Mr. DiMario. Thank you, Mr. Chairman.

                         Additional committee questions

        Senator Bennett. We appreciate your coming in. We
    appreciate all the hard work you do.
        Mr. DiMario. Thank you.
        [The following questions were not asked at the hearing, but
    were submitted to the Office for response subsequent to the
    hearing:]
                         Additional Committee Questions
               revolving fund/gpo year end losses/printing rates
        Question. Section 309 of Title 44 requires that the revolving fund
    be reimbursed for the full cost of services. The GPO revolving fund has
    sustained losses since fiscal year 1991. For fiscal year 1994 through
    fiscal year 1996, the losses were:

    GPO Revolving Fund

                            [In millions of dollars]

                                                                Surplus/loss

    Fiscal year 1994 actual.......................................     -21.8
    Fiscal year 1995 actual.......................................      -3.0
    Fiscal year 1996 actual....................................... \1\ -16.9
    Fiscal year 1997 est..........................................         ?

    \1\ Increase in printing rates went into effect in May 1996.

        The fiscal year 1996 revolving fund sustained a loss of $16.9
    million, more than five times the fiscal year 1995 loss of $3 million.
    How much of the losses for 1994, 1995, and 1996 are generated by
    congressional printing, executive branch work, and judicial branch
    work? What steps has GPO taken to prevent similar losses in fiscal year
    1997?
        Answer. The estimated distribution of the losses follows:

    ----------------------------------------------------------------------------------------------------------------
                                                                          1994             1995            1996
    ----------------------------------------------------------------------------------------------------------------
    Legislative Branch:
        Congressional Printing and Binding........................     ($8,500,000)     ($3,000,000)  ..............
        Other Legislative Branch Agencies.........................      (1,478,730)        (235,208)      ($614,046)
                                                                   -------------------------------------------------
          Subtotal, Legislative Branch............................      (9,978,730)      (3,235,208)       (614,046)
                                                                   =================================================
    Judicial Branch...............................................         (86,893)         (14,071)        (33,175)
    Executive Branch..............................................     (18,158,377)      (2,988,721)     (7,015,779)
                                                                   -------------------------------------------------
          Subtotal Printing and Binding...........................     (28,224,000)      (6,238,000)     (7,663,000)
                                                                   =================================================
    SuDocs........................................................       6,450,000        3,213,000      (9,248,000)
                                                                   -------------------------------------------------
          Total...................................................     (21,774,000)      (3,025,000)    (16,911,000)
    ----------------------------------------------------------------------------------------------------------------

        Printing and Binding revolving fund losses were allocated to the
    branches of government indirectly based on the proportion of total work
    billed to each. These losses were the result of several factors. The
    primary cause of the under recovery in Printing and Binding was that
    rates were frozen since 1990. While cost savings were being achieved
    through reductions in the workforce and other measures, significant
    cost increases had to be absorbed, such as pay raises and supplier
    price increases. Workloads also decreased.
        Section 309(b) of Title 44 requires that the revolving fund be
    reimbursed for the cost of all services and supplies furnished. In a
    letter to the Public Printer, dated April 16, 1996, Chairman Thomas
    indicated that the Joint Committee on Printing (JCP) expects the Public
    Printer to comply with the provisions of section 309.
        Unliquidated obligations, totaling $6.2 million, reimbursed the
    fund for the full cost of Congressional work in fiscal year 1996. Since
    rates were not adjusted until May of 1996, the full cost of executive
    agency work could not be recovered from them because they did not
    obligate the necessary amounts through requisitions. During fiscal year
    1994 and fiscal year 1995, CP&B appropriation accounts also incurred
    costs which significantly exceeded reimbursements to the fund. The
    unliquidated obligations, totaling $11.5 million, were reimbursed to
    the fund during fiscal year 1997. In addition, $1.3 million was
    reimbursed to the fund during fiscal year 1997 from S&E appropriation
    accounts for under recovered cost during fiscal year 1994-1996. Losses
    which were not reimbursed have been financed through reductions in
    retained earnings in the revolving fund.
        In order to prevent similar losses in fiscal year 1997, GPO is
    reducing staffing levels, investing in technology, and managing rates.
    However, many factors affecting workload and operating costs are beyond
    the control of GPO. Unless workload increases substantially and GPO is
    able to serve a larger share of the Government's printing requirements,
    it may not be possible to avoid losses in fiscal year 1997.
        Question. At the beginning of fiscal year 1997, what was the GPO
    estimate of the revolving fund revenues and expenses? Was it revised at
    the end of the second quarter? If so, what were the adjusted estimates?
        Answer. At the beginning of fiscal year 1997, GPO budgeted revenue
    of $843 million and total expenses of $840 million. Through the first
    half of fiscal year 1997, revenue totaled $403 million and expenses
    totaled $408 million. This compares to total revenue of $443 million
    and expenses of $453 million for the first six months of fiscal year
    1996. Based on experience to date, revenue is now expected to fall
    significantly short of the budgeted level. Workload volume has fallen
    short of projections.
        Question. Does GPO now estimate the revolving fund will sustain a
    loss for fiscal year 1997? If so, how much of a loss?
        Answer. In order for losses to be avoided, workloads will have to
    increase significantly. GPO cannot control the level of work requested
    by customers. If workloads do not increase substantially, price
    increases will be necessary. Congressional workloads are expected to
    increase substantially for the remainder of the year. Agency workloads
    will largely depend on compliance with the requirement to procure
    printing through GPO. A significant volume of publications that were
    previously printed through GPO and sold through the Superintendent of
    Documents Sales Program are being diverted to other agencies, such as
    NTIS, UNICOR, GSA and DAPS, or being ``privatized''.
                       depository library transition plan
        Question. By the end of fiscal year 1998 (assuming funding at or
    near the fiscal year 1996 level), GPO plans to provide about 50 percent
    of FDLP information electronically. In his Senate testimony last year
    on the fiscal year 1997 budget request and in his House testimony this
    February on the fiscal year 1998 budget request, Mr. DiMario made the
    following statement: ``Significant progress toward a more electronic
    FDLP can be made by the end of fiscal year 1998 with essentially flat
    funding. For the out years, fiscal year 1999 and beyond, there are too
    many variables involved to accurately project program funding
    requirements at this time.''
        In the GPO Budget Justification for fiscal year 1998 on page III-6
    for 2h (Workload--Misc. Services), it states that the increase
    ($1,141,000) represents additional expenses needed to transfer the
    Federal Depository Library Program to an electronic format. Does GPO
    consider this essentially flat funding?
        Answer. The request is essentially flat compared to the amount
    requested for fiscal year 1997, and compared to fiscal year 1996 and
    fiscal year 1995 appropriations. The fiscal year 1998 request of
    $30,477,000 is $350,000 less than what was initially requested for
    fiscal year 1997; however, it is $1.4 million more than what was
    approved for fiscal year 1997. The request is essentially flat compared
    to the $30.3 million appropriated for fiscal year 1996, and the $31.6
    million appropriated for fiscal year 1995 (net of a $600,000
    rescission). These numbers have not been adjusted for inflation.
        As the program transitions from ink-paper to electronic formats,
    the workload mix is changing. This will cause some object classes, like
    ``Other Services,'' to increase and others, like printing, to decrease.
    A major portion of the fiscal year 1998 funding request is for ``Other
    Services'' in support of the transition to a more electronic Federal
    Depository Library Program, including source data file acquisition,
    preparation, and loading of agency databases into the GPO Access
    system.
        Question. When will GPO be able to project program funding
    requirements for fiscal year 1999, fiscal year 2000 and fiscal year
    2001?
        Answer. GPO will submit funding requests for the Federal Depository
    Library Program for fiscal year 1999 to the Congress in December 1997.
    We anticipate an overall S&E funding request in the $30 million range
    for fiscal year 1999. However, in this period of rapid change there are
    too many variables, such as the initiatives to amend 44 U.S.C., changes
    in agency printing practices, technological developments, and the like,
    to allow any early projections for the fiscal year 2000 and fiscal year
    2001 requests to be more than purely speculative.
        Question. All Federal depositories are now expected to offer public
    users access to computer work stations with a graphical user interface,
    CD-ROM capability, Internet connections, and the ability to access
    Government information via the World Wide Web. However, as of 1995
    nearly 25 percent of the depository libraries lacked Internet access
    for public patrons.
        What is the status of this directive? Have there been any new
    developments or changes in its implementation?
        Answer. For fiscal year 1997, House Report 104-657 provided a
    $50,000 reduction in the Salaries and Expenses Appropriation and a
    $1,050,000 reduction in the Congressional Printing and Binding
    Appropriation by converting the Bound Congressional Record to CD-ROM.
    The Report also directed GPO to produce and distribute the permanent
    Congressional Record at the direction of the Joint Committee on
    Printing. Accordingly, correspondence was sent to the Chairman, JCP on
    March 28, 1997, asking for the distribution requirements of the Record
    both in CD-ROM and paper. We have not yet received a response.
        GPO has been advised of very serious concerns within the depository
    library community about the discontinuation of the paper format bound
    Congressional Record in the Federal Depository Library Program (FDLP).
    Depository librarians view the bound Congressional Record as an
    essential reference resource which should be maintained in the FDLP in
    paper format. There are also legitimate questions about the permanency
    of the CD-ROM format, from an archival medial standpoint, as well as
    issues concerning computer hardware and software obsolescence. The
    depository library community considers the permanent Congressional
    Record one of the core documents of our democracy, one which should, at
    a minimum, be preserved in paper format for the free use of the public
    in at least one library in every state.
               house clerk's proposed document management system
        Question. In Mr. DiMario's testimony on February 11, 1997, before
    the House Legislative Subcommittee, he voiced several serious concerns
    about this plan. During his appearance, Mr. DiMario was advised to
    contact the House Clerk and request a meeting since the two of them had
    not previously discussed the earlier report or the Clerk's proposed
    Document Management Plan.
        Has Mr. DiMario met with the House Clerk yet? If so, what was the
    outcome?
        Answer. Yes, Mr. DiMario recently had a cordial meeting with the
    House Clerk to discuss the House's proposed document management system.
    A new channel of communications has been opened. The Public Printer
    pledged support for the Clerk's efforts. Over the past three decades,
    GPO has built a core capability for electronic information and
    communications services to support Congress' information needs. Today,
    GPO has state-of-the-art electronic systems characterized by a complex
    of direct electronic linkages via CAPNET to a variety of congressional
    offices on Capitol Hill for data interchange. Once considered only the
    by-product of the print production process, digitized electronic
    databases of congressional information are now the primary product:
    they are the databases from which the official versions of documents
    are produced in print, CD-ROM, and online access formats made available
    to the public through GPO Access as well as other systems such as the
    Library of Congress's THOMAS information system.
                  upcoming rules committee hearing on title 44
        Question. The Rules Committee has scheduled hearings on Title 44
    U.S.C. for April 24 and April 30, 1997. The focus of the hearings will
    be the reform of Title 44 U.S.C. and the implementation of means to
    assure that the American public retains access to information created
    by the Federal Government at taxpayer expense.
        Has GPO, or any other group, conducted a study or review to
    determine why GPO customers are seeking alternative printing options
    which has resulted in GPO's reduced customer base. For example, when
    was the last evaluation conducted of customer satisfaction with the GPO
    work product in terms of timeliness, quality, security, and economy in
    printing?
        Answer. The vast majority of GPO's customers are not actively
    seeking alternative printing options. Misunderstanding resulting from
    statements in the National Performance Review, which referred to GPO as
    a ``monopoly'', and a controversial opinion by the Justice Department's
    Office of Legal Council, which characterized GPO as having ``extensive
    control'' over executive branch printing, have created an ambiguous
    environment regarding administration policy and direction. This has
    encouraged agencies to seek alternatives.
        There has been misinformation generated over the last couple of
    years by groups such as the National Technical Information Service
    (NTIS) and the General Services Administration (GSA) regarding Title 44
    and the value of the services that GPO provides. This, and claims that
    these groups can provide better prices and a less restrictive printing
    environment, has resulted in much uncertainty and confusion, which has
    caused some customers to question the need to come to GPO. Some
    publications previously printed and sold through GPO have been diverted
    to other agencies.
        There has been an increasing tendency for some agencies to attempt
    to benefit financially from the value of the information they create at
    taxpayer expense, through such means as copyright-like restrictions.
    There has been a tendency for certain agencies to occasionally
    overbuild in-house printing capacity; and, to contract independently
    for printing, at higher cost. GPO's centralized printing procurement
    contracts allow the government to aggregate demand, promote broad
    competition, and obtain the best prices. GPO also offers performance
    control and other support services that would be too expensive for each
    agency to duplicate.
        The last survey of customer satisfaction was performed by GPO's
    Office of the Inspector General in 1995. A comprehensive survey of
    GPO's performance, including timeliness, quality, and economy was sent
    to 111 of GPO's Executive Branch agency customers. The IG's final
    report, ``Results of the Office of Inspector General Survey of Customer
    Satisfaction in the Executive Branch,'' was issued in August 1995.
    During the survey period, the customer agencies rated GPO's service and
    performance to be satisfactory or better. Results from interviews
    conducted with GPO's ten largest billing Executive Branch agencies
    indicated that, despite some areas of concern, GPO performs a valuable
    service for them. The GPO entities involved have taken actions to
    investigate and improve these problem areas.
        In 1994, Customer Services surveyed customers to solicit feedback
    regarding the success of GPO's efforts to improve total operations and
    to measure how its customers perceived the quality of service they were
    receiving. Surveys were distributed each quarter to approximately one-
    fourth of the customer base, comprising a mix of large, medium, and
    small customers (as determined by the most recent year-end billings).
        The surveys were compiled and analyzed each quarter. Although the
    results of each survey indicated general overall satisfaction, any
    problem areas indicated were examined and brought to the attention of
    the applicable GPO area. Quarterly survey results were then compared to
    gauge the success of overall efforts to improve service. The results of
    each survey were provided to upper management and applicable Customer
    Services personnel.
        Because of discussions with OMB, the possible rewriting of Title
    44, and the comprehensive nature of the IG's 1995 survey, we have
    refrained from taking any additional formal customer satisfaction
    surveys at this time. While we continue to monitor customer
    satisfaction on a daily basis, we will resume the formal surveys when
    appropriate. A GAO survey of Federal Agencies in 1987 found that the
    vast majority of agencies were satisfied with GPO services.
        GPO's workload has declined largely because agency printing budgets
    have been seriously impacted by reductions in appropriations. There has
    been a shift in format from paper to electronics. This has resulted in
    a substantial decrease in both the number and size of orders. GPO's
    printing procurement and information dissemination programs continue to
    offer the best value and fulfill important public policy goals.
                            gpo 1998 budget request
        Question. For fiscal year 1998 GPO is requesting $114.5 million for
    those programs that require annual appropriations directly to GPO. This
    is an increase of $3.8 million, or 3.4 percent, over the funding
    approved for fiscal year 1997. The request includes $84 million for the
    Congressional Printing and Binding Appropriation and $30.5 million for
    the Salaries and Expenses Appropriation of the Superintendent of
    Documents. According to GPO, the increase is due primarily to general
    price level increases, although for congressional printing there are
    also workload increases in various product categories that GPO states
    are typical for a second session of Congress.
        The following budget items show significant changes to the budget
    base.
      --GPO projects more than a 16.7 percent increase in the number of
            copies of the Daily Record over the 1997 level.
      --GPO projects a 50 percent increase in the number of copies of
            Business and Committee Calendars.
      --GPO projects a 23.2 percent increase in the number of Committee
            Reports.
        For the Daily Record, the Business and Committee Calendars, and
    Committee Reports, what was the percentage increase in production for
    the second session over the first for the 101st, 102nd, 103rd and 104th
    Congresses?
        Answer. The percentage increase in the Second Session production
    (pages) over the the First Session production for each Congress is
    shown in the following table:

    ------------------------------------------------------------------------
                                                   Congress
                                 -------------------------------------------
                                    101st       102d       103d      104th
    ------------------------------------------------------------------------
    Daily Record................       26.3       14.6       25.0       24.1
    Business and Committee
     Calendars..................       43.2      101.8       52.6       50.9
    Committee Reports...........       11.8       50.5       22.6       38.6
    ------------------------------------------------------------------------

                                   personnel
        Question. GPO has an FTE limitation in its appropriations language.
    For the past two years it has been stated in terms of an end-of-the-
    year staff on board level. For fiscal year 1997 the target is 3,600.
    GPO projects it will be at 3,550 by the end of fiscal year 1998. During
    Mr. DiMario's testimony this February before the House Legislative
    Appropriations Subcommittee, he stated that GPO currently had 3,674 on
    board.
        What is your current on board staff level? Do you still expect to
    reach a level of 3,600 on board by September 30, 1997?
        Answer. As of April 30, 1997, the total on board level was 3,645
    employees and the rate of FTE utilization was 3,578 for the month of
    April. The appropriations language refers to FTE's (Full Time
    Equivalent) employment at the end of the fiscal year. FTE's are
    normally less than on board employment because some employees take
    leave without pay and some employees work part-time. Only paid
    employment is counted in FTE's. GPO expects to comply with the ceiling
    established by the appropriations language and, based on April data, is
    already below that level.
        Question. At a previous Joint Committee on Printing hearing in
    1995, several questions were asked about GPO supervisory staff levels.
    At the time, Mr. DiMario stated that regarding senior level super
    grades, in 1992 there were 32 and in 1995 there were 22 (a 31.3 percent
    reduction). However, in the fiscal year 1998 Budget Justification (page
    V-3), a Summary of Employees by Organization indicates the following:

    ------------------------------------------------------------------------
                                                                   Percent
               Organization             1993 Staff   1996 Staff    Decrease
    ------------------------------------------------------------------------
    Executive Offices................          102          102  ...........
    Office of Administration.........          843          690          -18
    Procurement Services.............          775          588          -24
    Production Services..............        1,921        1,500          -22
    Customer Services................          232          200          -14
    Superintendent of Documents......          912          719          -21
                                      --------------------------------------
          Grand Total................        4,785        3,799          -21
    ------------------------------------------------------------------------

        How can both of these statistics be accurate?
        Answer. The above table does not identify the number of senior
    level employees at GPO, but rather is a summary of total employees by
    organization at the end of each fiscal year. The numbers stated by the
    Public Printer at the hearing were accurate. As of April 21, 1997,
    there were 19 senior level employees on board.
        Question. Not all of the segments at GPO have shared the burden of
    downsizing, and those which did, did not share the burden equally.
    Please explain.
        Answer. The Executive Offices for fiscal year 1996 includes 10
    employees returning from OWCP (Office Workers Compensation Program) and
    who have light duty assignments in various office throughout GPO. In
    fiscal year 1993, employees on this category were not reported in the
    Executive Offices total, but instead were included in the organizations
    to which they were assigned for duty.
                              energy conservation
        Question. Last year GPO proposed legislative language to achieve
    energy conservation as part of the Fiscal Year 1997 Legislative Branch
    Appropriations Act. The language was not acted on by Congress.
        Please briefly describe last year's efforts, and the current status
    of this legislation.
        Answer. GPO requested authority to enter into contracts for energy
    conservation services with performance guarantees. These services are
    estimated to have a potential annual savings of $500,000. The savings
    would be used to replace inefficient and worn out air conditioning
    equipment, which is environmentally unsafe, and to upgrade necessary
    electrical equipment. The Architect of the Capitol was provided this
    authority when it was included in the National Energy Conservation
    Policy Act (42 U.S.C. 8287) by Public Law 103-211, dated February 12,
    1994; but, GPO was not included.
        In the last session of Congress, the necessary language was passed
    by the Senate, but was not included in the House-passed version. The
    provision was deleted in conference. GPO was asked to work through the
    House Commerce Committee on the amendment. GPO has been working with
    staff of the Commerce Committee on the request.
             privatizing the congressional record/federal register
        Question. In the House report accompanying GPO's Congressional
    Printing and Binding Appropriation for fiscal year 1997 (H. Rpt. 104-
    657, pp. 28-29), GPO is required to conduct a study, using independent
    outside experts, to determine if opportunities exist for outsourcing
    the Congressional Record and the Federal Register. According to Mr.
    DiMario's testimony before the House subcommittee last February, GPO
    recently posted a notice in the Commerce Business Daily.
        When do you expect to award the contract and what is the estimated
    completion date?
        Answer. GPO does not have the authority to procure consulting
    services in excess of $50,000 without the approval of the Joint
    Committee on Printing (JCP), based on a resolution passed by the JCP in
    1987. GPO estimates that the cost of the study could be as much as
    $600,000. In order to comply with House Report 104-663, GPO wrote to
    the Chairman of the JCP requesting approval for the procurement, but
    approval has not been given.
                              by-law distribution
        Question. About 2,190 copies of the Congressional Record are
    distributed without charge to recipients designated by Senators.
        Please provide a copy of the Senate distribution list.
        Answer. The list has been provided to the committee.
             pilot project for online access to committee hearings
        Question. GPO is currently piloting a system for providing online
    access to congressional hearings that will assist House committees in
    fulfilling the recent House rules change requiring online dissemination
    of committee materials.
        Please provide additional information on this project as well as
    the feasibility, benefits and drawbacks of it being adapted to Senate
    Appropriations Committee hearings.
        Answer. A small pilot was initiated in January 1997, involving GPO,
    House Committee on Government Reform and Oversight, House Committee on
    Science, and the Senate Appropriations Committee. Its purpose was to
    explore the feasibility/cost-effectiveness of providing complete
    hearings and committee prints online via GPO Access. The advantage was
    sought to include even submitted material in encapsulated PostScript
    (EPS), to enable citing the online Portable Document Format (PDF)
    version as a facsimile of the official printed version. GPO believes
    that the preferable approach would be for congressional leadership to
    stipulate (with GPO's assistance/participation), standardized data
    structures for submission of data to be included in these publications.
    Such an approach would result in all data being searchable and
    reproducible in a variety of formats. The pilot procedures have already
    been successfully employed and could be continued to make critical
    publications available electronically on an interim basis. The
    procedures necessitate scanning images to arrive at EPS versions that
    sometimes require inordinate amounts of computer disk space and tend to
    exceed some committees' present computer configurations. The pilot is
    expected to determine whether these functions would be performed by
    committees, by GPO, or a combination of both, while providing a basis
    for cost analysis.
        In addition to this pilot, World Wide Web (WWW) ``home pages'' have
    been incorporated into GPO Access for all House and Senate committees.
    These WWW pages facilitate listings of, and access to, all publications
    processed by the committees through GPO. These pages also include
    extracts from appropriate congressional publications which provide
    access to committees' membership, jurisdiction, and rules of procedure.
    The Uniform Resource Locators (URL's) for these pages can be used by
    committee WWW sites to minimize unnecessary and duplicative processing
    of publication data. Further development of GPO Access was undertaken
    at the request of the Senate Committee on Rules and Administration to
    permit remote WWW sites to link directly to documents resident on GPO's
    servers. The software has been developed and GPO is in the process of
    incorporating unique identifiers within each resident document to
    facilitate its use. A WWW page (http://www.access.gpo.gov/getdoc.htm)
    is under development to explain how to establish links. This page
    describes the HTML coding necessary to link directly to documents
    resident on GPO's WAIS Servers. HTML code from these pages can be
    copied to remote web sites (such as the House or Senate), to allow
    direct linking to all documents resident on GPO's WAIS servers. Two
    different CGI scripting interfaces are described: (1) a text link, (2)
    a graphic button. External sites desiring to link to a specific
    document on GPO's servers may choose either of the two interfaces. This
    method can be used for linking to both text and PDF documents within
    multi-document databases as well as linking to text and PDF versions of
    single-document databases.
                   gpo long-range planning for the year 2000
        Question. In the GPO 1998 budget request, long-range planning for
    increased printing requests for the year 2000 is not addressed. Such an
    increase is likely in view of the fact that in 1989 the Bicentennial
    Commission ordered 3.7 million pocket-sized copies of the Constitution.
        Please describe any long-range planning which GPO has done
    regarding: (a) printing increases due to the year 2000, (b) conversion
    of computer systems for the year 2000.
        Answer. Regarding printing increases, GPO has requested input from
    Congressional offices. As the Government printer, GPO does not usually
    suggest to the Congress or Agencies what to print. The printer's role
    is to respond to requisitions for printing from the customer source.
    The printer must maintain up-to-date technology which will enable, or
    facilitate economic creation of the desired product. The GPO does
    maintain up-to-date technology or the ability to procure printing
    related commodities providing for economy of scale. GPO's long-range
    planning includes provisions for the continued improvement in the
    performance of our mission.
        Some ideas for printing for the year 2000 would include vehicles
    which could provide for the reproduction and/or creation of some first
    class, high quality, printed products as described below:
      --Produce two special ``Year 2000 Calendar'', one for the House and
            another for the Senate, as had been printed until a few years
            ago.
      --Produce an edition of ``The `Capitol'--Year 2000'' which could
            commemorate the ending of one century and the beginning of
            another century. This publication is usually printed as a
            Senate Document.
      --``The Constitution of the United States of America'' and ``Our
            Flag'' are two other examples of publications which could be
            provided with a ``Year 2000'' theme. These publications could
            have wide distribution and would surely provide the recipient
            with a sense of pride in our Government.
      --The ``Biographical Directory'', ``History of the Committee on Ways
            and Means'', ``Guide to Former Members Papers, 1789-1987'',
            ``Bicentennial Publications on House Record'', ``Research Guide
            to Members Papers at Archives'', ``The U.S. Capitol--a Self
            Guided Tour'', ``History of the House'', ``Establishment of the
            House'', and ``Senate Bicentennial Minutes'' are other
            publications which could be suitably designed for a Year 2000
            commemoration. These publications and other similar
            publications were printed to commemorate the Bicentennial of
            the Congress.
      --Another suggestion is to prepare an electronic data base of the
            ``Serial Set'' material (House and Senate Documents and
            Reports) for the past century. This would provide legacy data
            for on-line research for centuries to come.
        GPO has completed a year 2000 impact assessment on mission critical
    systems. We have compiled an inventory of computer applications which
    will be affected by the turn of the century. Some of our applications
    and databases have been identified for total replacement while others
    will be, or are being, modified to accommodate the date problem. GPO
    has acquired two off-the-shelf software packages to facilitate the
    changes. These packages have worked well with COBOL applications.
    However, we are still looking for a good package that will assist us in
    identifying changes to many of our older COBOL/ALC programs and Natural
    Programming code of the Software AG's ADABASE Database Management
    System that need to be changed. GPO is planning to implement a client/
    server environment utilizing ORACLE and NT tools. We are designing
    relational tables and populating them under ORACLE/NT. As this effort
    progresses, it will set up a Data Warehouse for the entire GPO and
    thereby reduce the Year 2000 modification effort for the report
    producing and end-user data access programs. Our goal is to complete
    this effort well in advance and test all modifications before year
    1999. Additionally, we plan to upgrade our mainframe operating system
    from IBM MVS/XA to MVS/ESA, which will be critical to effectively
    transition to the year 2000.
                 government performance and results act [grpa]
        Question. Is GPO covered by the GPRA? Please describe any steps GPO
    has taken to comply with the Act?
        Answer. For purposes of the GPRA, ``the term `agency' means an
    Executive agency under Section 105 * * *''. Section 105 of Title 5,
    United States Code, defines the term ``executive agency'' as ``an
    Executive department, a Government corporation, and an independent
    establishment.'' Since GPO does not fall within any of the above
    categories or definitions, we must conclude that it is not subject to
    the provisions of the GPRA.
        Last year, a strategic plan on the Federal Depository Library
    Program was included in the final Study Report, covering the period
    fiscal year 1996-2001. In 1993, GPO developed a comprehensive strategic
    plan, but this has not been updated. GPO has testified frequently
    before various committees of Congress on strategic issues facing the
    agency, most recently in relation to proposals for Title 44 reform. GPO
    has developed performance objectives for priority areas and includes
    them in the annual report.
        Question. In response to questions previously submitted regarding
    the year 2000 computer problem, GPO stated that they have purchased two
    off-the-shelf software packages, they are looking for a third package
    for older equipment, and anticipate completing all testing by fiscal
    year 1999. How much money does GPO expect to spend in fiscal year 1998
    to fix the year 2000 problem?
        Answer. GPO expects to spend about $1 million in fiscal year 1998
    to fix the year 2000 problem. This includes upgrading the mainframe
    computer, certain application programs, and modifications to software.
        Question. The workload at GPO has been declining in recent years.
    At the same time, GPO has been continually incurring losses--$21.8
    million in fiscal year 1994, $3 million in fiscal year 1995, and $16.9
    million in fiscal year 1996 ($7 million if losses from the
    Superintendent of Documents is excluded.) What is GPO projecting for
    losses in fiscal year 1997? Excluding the Superintendent of Documents
    program, how does GPO plan to avoid losses in fiscal year 1998?
        Answer. Losses in fiscal year 1997 through May total $5.9 million,
    primarily in the Materials Handling Operations and Printing
    Procurement. These losses are due to a reduced workload in the Plant
    and a reduction in the volume of work procured for certain agencies,
    such as Treasury and the Postal Service. A reduction in paper prices
    has been a significant factor in losses because GPO is reimbursed
    partially through surcharges based on the cost of paper. GPO's
    objective is to break-even for the remainder of the year, but actual
    results will depend largely on adequate workload levels and a reversal
    of some of the adverse trends cited above. Upcoming Congressional
    recesses could result in temporary workload reductions. Demand is not
    falling in a uniform, predictable manner, but rather fluctuates in a
    general downward trend. In order to avoid losses, controllable costs
    will continue to be reduced. Investments in technology will enable
    continued attrition while allowing services to be improved. Major
    technology investments are the Integrated Processing System in
    Documents, an information network in Printing Procurement, and the
    computer-to-plate system in the Plant. We are expanding electronic
    means and services. Improved compliance by Executive agencies with
    title 44 requirements to utilize GPO programs would increase revenue,
    reduce government-wide costs, and increase the availability of
    government information to the public.
        Question. Under current law and practice, GPO has up to three years
    in which to bill for work. What is the reason for this long billing
    period and what would be required for GPO to be able to bill for work
    within the year the work was performed?
        Answer. GPO generally bills for work after it is completed and
    actual costs are known. Often, jobs are not ready to print at the time
    of requisition, usually because the customer requires additional pre-
    press work such as revisions. An example is congressional committee
    hearings where the final production of the hearing record may take
    several months, perhaps overlapping fiscal years. Sometimes commercial
    printers do not bill GPO promptly for the work they perform, which
    delays GPO's billing process.
        The major goals of any change in billing procedure should be to
    reduce administrative cost, simplification, and control. GPO can
    advance-bill an estimated amount, rather than the actual cost, before
    the work is completed. The amount billed would be intended to reimburse
    the complete cost of a job, regardless of when the work is required and
    performed. GPO can work with congressional committees and offices to
    speed up the billing process for their products. The alternative to
    close out all congressional jobs every year, regardless of their
    status, and to reissue new requisitions for uncompleted work annually,
    would impose significant administrative costs on GPO and Congress.
        GPO has made a number of improvements to alleviate the delayed
    billing problem by use of deposit accounts, credit cards, firm pricing,
    and automating some of the billing functions using personal computers.
    Congressional rider billings to agencies are now being processed daily
    rather than after all of the orders for the year are complete. For
    commercially procured work, where billings are not received from the
    printing contractors, GPO estimates the job costs and bills the
    ordering agencies approximately six months after the scheduled delivery
    date. We have also implemented a firm pricing policy which establishes
    the amount to be billed when the order is received. Agencies can
    request that GPO provide a firm price so they can obligate the proper
    amount of money. We honor all firm price quotes regardless of actual
    cost.
        GPO has been encouraging agencies to use the VISA IMPAC credit card
    as a method of payment for printing and binding orders. GPO began
    accepting credit card payments from agencies in May 1994 and the dollar
    volume has steadily increased to about $300,000 per month. Use of the
    credit card coupled with a firm price from GPO reduces the billing and
    collecting cycle time to one day.
        Another payment option that GPO offers is a GPO Deposit Account.
    Under this option, the customer agency deposits an amount of money with
    GPO and places printing and binding orders against these funds. GPO
    reduces the Deposit Account by the cost of the orders and sends the
    ordering agency a statement at the end of each month which includes a
    detailed listing of the print jobs and their actual cost and the
    deposit account balance at the end of the month.
        GPO has been able to offer these new streamlined payment options by
    automating many of the functions involved in the billing and accounting
    processes. The major goal of these initiatives is to reduce the
    accounting staff and paperwork at GPO and throughout the rest of the
    Federal Government, while improving the accuracy and timeliness of
    accounting information. GPO can work with Congress to utilize these
    initiatives to speed up the billing process for congressional products.
        Question. GPO estimated that there was a $9.2 million deficit in
    fiscal year 1996 for the Superintendent of Documents account. Please
    explain why there was a loss and provide details surrounding the
    program GPO plans to implement to avoid future losses in this program.
        Answer. The shutdowns of Federal Government operations during the
    budget impasse and the Government closure in Washington, DC, due to
    inclement weather negatively impacted order and sales activity for
    fiscal year 1996, leading to unanticipated revenue declines. While the
    Sales Program was not closed during the second Government budget
    shutdown, many of our customers nationwide mistakenly believed it was.
    The January 1996 snow storm caused the entire region to shutdown for
    four days, including GPO's telephone order system in Washington, DC,
    and publications shipping facility in Laurel, MD.
        In the latter half of the year a concerted effort was made to
    remove from the inventory all publications considered unsalable,
    resulting in a high unsalable publications expense in fiscal year 1996.
    Several steps aimed at preventing a future build up of unsaleable or
    surplus publications have been taken. These include the establishment
    of new product ordering guidelines and the formation of a team to
    review product requisitions.
        Since the beginning of fiscal year 1997, the sales program has
    taken steps to improve sales and decrease expenses. Sales revenue has
    increased from last year. Several of these projects have already
    resulted in changes that have been fully implemented. Others are
    expected to take longer to implement and produce results.
        Question. In previously submitted questions GPO stated that it
    estimates congressional workloads to increase substantially for the
    remainder of the year. How do you estimate your workload levels?
        Answer. Workload levels are estimated by analyzing the level of
    demand for each category or classification of work for previous years.
    GPO considers such factors as first session year of a Congress; second
    session year of a Congress; Presidential election years; first year of
    Presidential term; second year, etc. Consideration is also given for
    known atypical circumstances. Congressional workload during the first
    quarter of fiscal year 1997 was very low by historical standards.
    Therefore, a return to a more normal workload level was expected to
    result in increased workload. We have seen a significant increase in
    workload over the past several months in some areas.
        Question. In testimony before the Rules Committee this year, it was
    stated that the ``reserves'' are at a critically low level. What is
    considered ``critically low'' and what are the problems associated with
    such a ``low'' level.
        Answer. The minimum acceptable cash balance is $15 million. When
    cash drops to that level, the Comptroller implements GPO's cash
    management plan which requires issuance of partial billings and advance
    billings to GPO's customers. These actions cause processing of
    additional GPO invoices by our customers and in extreme cases could
    cause us to delay paying suppliers until cash is restored to an
    acceptable level.
        GPO spends an average of $3.6 million per day for normal operating
    expenses and plans to spend more than $8 million during the remainder
    of fiscal year 1997 for capital improvements. If cash falls below the
    $15 million minimum, certain expenditures may have to be deferred until
    such time as the cash balance is increased.
        Question. A previous question asked if the revolving fund revenues
    and expenses were revised at the end of the second quarter, and if so,
    what were the adjusted estimates? Your response did not address these
    questions. Was the revolving fund estimate revised at the end of the
    second quarter of fiscal year 1997, and if so what are the revised
    estimates? Based on these revisions, will GPO break even this year? If
    not what further steps is GPO planning to take to break even?
        Answer. At the beginning of fiscal year 1997, GPO budgeted revenue
    of $843 million and total expenses of $840 million, with a net surplus
    of $3 million. These amounts have been included on the Monthly
    Financial Estimates and JCP Financial Package throughout fiscal year
    1997. However, during the second quarter we reassessed the GPO's
    revolving fund financial operations and revised the year-end fiscal
    year 1997 projection from a $3 million surplus to a $.3 million
    surplus. Actual financial results of operations through May of fiscal
    year 1997 are a loss of $5.9 million. These losses are due to reduced
    workload in the Plant, a reduction in the volume of work procured, and
    reduced paper prices. GPO achieved a small net income in the month of
    May and the objective is to break-even for the remainder of the year.
    Actual results will depend largely on adequate workload levels. We are
    continuing to attrit the workforce in an effort to balance this major
    controllable cost with anticipated revenues. GPO management will
    continue to monitor the workload and revenues in the final quarter to
    determine whether additional financial cost control measures become
    necessary.
        Question. In response to a previous question, you state that
    workloads will have to be increased significantly in order for GPO to
    avoid losses. Are there not other steps GPO can take to avoid these
    losses?
        Answer. Financial results are very closely correlated with changes
    in workload levels. Apart from efforts to increase workload, customer
    service, and enhanced services, GPO is reducing costs and investing to
    become more efficient. GPO has achieved significant reductions in
    employment and overtime over the past four years, and continued cost
    reduction is planned. Planned investments focus on the use of
    information and communications technology.
        Question. Does your response to a previous question suggest that
    GPO plans to do more work in-house than it originally planned?
        Answer. Based on experience to date, GPO does not expect in-house
    workload to exceed the level planned, but does expect an increase in
    the remainder of the year over the first four months.
        Question. How will that affect the agency's printing procurement
    program?
        Answer. The increase in plant workload is expected from increased
    customer requirements for core products generally performed in-house,
    not from diverting work usually procured.
        Question. How does the Government Printing Office forecast its
    revenues and expenses? Are they based solely on the previous year's
    level of activity, or is there some other more reliable measurement
    upon which GPO bases its estimates?
        Answer. Revenue, in particular, cannot be forecast with reliability
    because of the many uncontrollable and unpredictable factors involved.
    The following factors are considered in forecasting revenue and
    expense, many of which are largely qualitative in nature:
      --Past trends in workload, including cyclical patterns.
      --The impact of information technology on workload mix.
      --Known or anticipated changes in workload planned by customers.
      --Initiatives that might impact on compliance with title 44.
      --Activities of competing agencies, such as DAPS and NTIS.
      --Economic factors, such as paper prices, and rate adjustments.
      --The impact of capital investments.
      --Projected workforce level.
      --Cost factors, such as wage agreements and supplier price increases.
        Question. It has been suggested that agencies be required to
    prepare an annual printing plan as part of their budget submission.
    Would GPO find this a helpful tool for its internal programming
    purposes? What other uses could GPO find for such a plan? Please
    provide the committee with an outline of the question which should be
    asked in such a planning tool.
        Answer. This would help GPO planning. GPO could assist OMB in the
    technical evaluation of these plans. They could provide information to
    aid the process of determining whether to establish, maintain or expand
    internal capacity or to rely on commercial sources through GPO's
    printing procurement program. GPO can be a resource for availability
    and estimated cost information to aid in this decision making process.
    The following information would be useful:
        How do you estimate prospective printing costs?
      --How are cost saving options considered, including optional
            production methods, papers, trim sizes, and new technologies?
      --Do you utilize the expertise of the Government Printing Office?
        If your plan includes in-house production,
      --How are costs determined?
      --Do demands fluctuate?
      --How do you balance capacity with demand?
      --How are costs compared with what is available from the private
            sector?
      --Is the private sector able to provide required service levels? At
            what cost? How is this determined?
      --Did you utilize the expertise of the Government Printing Office?
      --How do you plan to take advantage of new technologies?
        The Superintendent of Documents would find annual agency printing
    plans a useful tool in tracking down fugitive publications for
    distribution to the Depository Libraries. The Sales Program would find
    these plans helpful in alerting us in advance to new products, changes
    in publication scheduling for recurring products, and the discontinuing
    of existing products. This would be particularly useful for planning
    sales promotions and in forecasting anticipated customer demand. The
    following information would be helpful, if included in the plan:
      --Title of publication or subscription.
      --Expected date of publication.
      --Is publication for in-house use only? If not, what is the Target
            market for that product?
      --Expected size and binding type if printed.
      --If not printed, then expected alternative format.
      --Planned distribution method; free, Internet only, sales by agency,
            sales by GPO, Depository Library program, distribution by other
            second party in government or private industry.
      --Is product to be co-produced and distributed with a private
            company?
      --Will agency do any advertising prior to making the publication
            available for distribution?
      --Is publication required to be produced by law?
      --Is publication of public interest or educational value?
        Question. You have forwarded to the Joint Committee on Printing a
    proposal to acquire computer to plate technology. What is benefit of
    that technology?
        Answer. The two major benefits of computer-to-plate technology are:
    (1) the GPO will be able to continue to significantly reduce its
    workforce in areas of the plant directly involved in the printing
    processes; and (2) GPO will retain the capability of delivering a
    comparable volume of quality print products to Congress at reduced
    labor costs, without diminishing its ability to produce electronic
    products. Potential labor cost reductions and the large volume of time-
    critical work which can be processed with fewer GPO personnel resources
    insures the cost-effectiveness of this equipment.
        Other benefits:
      --Establish networked, high-speed, fully-automated platemaking
            capabilities, saving both labor and materials.
      --Greatly reduce the need for negatives and manual imposition,
            thereby eliminating redundant images of the same data, as well
            as several steps in the production process.
      --Greatly reduce film and chemical disposal/recycling and
            environmental concerns.
      --Greatly reduce film and plate handling and the corresponding
            damage/spoilage.
      --Greatly reduce film contact problems due to the elimination of
            film.
      --Improve scheduling as well as increase productivity.
      --Create electronic storage of imposition where none previously
            existed.
        Question. What cost savings do you anticipate with its
    implementation?
        Answer. The estimated annual savings of two-thirds of the staffing
    will be accomplished over a period of three years. It is assumed that
    about one-third of the savings will be achieved in the first year; two-
    thirds in the second year; and a full $7,345,000 in the third year. The
    reason that the savings are so large is that in order to make a plate
    GPO must first create negatives and then use them to make a plate. The
    direct to plate system eliminates the need to make a negative and also
    streamlines the plate making process. The operating and maintenance
    cost of some current equipment will be saved, and total space
    requirements will be reduced, as cameras and processors are surplused.
        Recognizing that the savings will be achieved gradually, it still
    makes good sense to proceed with procurement to gain the benefits in
    the production process. The revolving fund has enough cash to purchase
    the direct to plate systems which are estimated to cost $1,625,000. The
    cost of the equipment will be capitalized and appear on GPO's statement
    of financial position as a fixed asset. The equipment will be
    depreciated over a 5 year period which will generate depreciation
    expense of $325,000 per year ($1,625,000/5 = $325,000) which will
    appear on the statement of income and expense each year for five years.
        Question. How long will it take for those savings to be realized?
        Answer. The system will pay for itself in about one and one-half
    years. Labor cost reductions will begin in the first year and will be
    fully accomplished within three years of installing the new technology.
    The reduction in labor will be accomplished through normal attrition,
    retraining, and voluntary reassignments.
        Question. Is there a specific volume of work which must be
    maintained in order for this technology to be cost effective?
        Answer. A specific volume of work would have to be maintained
    during the short pay back period to insure that acquisition of the
    technology was cost-effective. However, since computer-to-plate (CTP)
    requires only a bare minimum of employees, cost effectiveness is
    assured. The large volume of agency work being processed provides
    additional assurance.
        Question. Are there other technological changes which must occur
    before this technology is effective or useful (e.g. Should the House
    and Senate be electronically transmitting all their proceedings to GPO
    in an identical language before this technology can be useful)?
        Answer. This has no bearing on whether GPO's employment of CTP
    technology would be useful or cost effective. No other technological
    changes are necessary to make GPO's employment of CTP technology useful
    and cost effective.
        Question. If so, would it not be more practical for other steps to
    be taken before the JCP approves your request?
        Answer. JCP approval of the pending request will permit continued
    attrition of the workforce presently assigned to these activities and
    materially reduce labor costs, without adversely impacting the
    capability to process a comparable volume of work.
        Question. The Joint Committee on Printing has asked the House
    Appropriations Committee to reconsider its request that GPO undertake a
    study to determine what Congressional printing needs could be
    outsourced. This request was made in light of current review of Title
    44 and other policy considerations currently affecting GPO. If the
    request to fund the acquisition of computer to plate technology is
    approved, will that lock GPO and the Congress into a situation where
    economically it will be impractical or impossible to consider
    outsourcing Congressional printing needs in the future?
        Answer. Although the CTP request before the JCP has a 5-year
    depreciation period, the system will pay for itself through savings in
    a much shorter period of time. Additionally, a large volume of
    Executive Branch publications are expected to be processed utilizing
    this same CTP equipment. Whether the work is outsourced or continues to
    be produced by GPO, any CTP expenditures would be completely recovered
    by the time such outsource contracts can be fully implemented.
                           GENERAL ACCOUNTING OFFICE

    STATEMENT OF JAMES F. HINCHMAN, ACTING COMPTROLLER
                GENERAL OF THE UNITED STATES
    ACCOMPANIED BY:
            J. DEXTER PEACH, ASSISTANT COMPTROLLER GENERAL FOR PLANNING AND
                REPORTING
            JOAN M. DODARO, ASSISTANT COMPTROLLER GENERAL FOR OPERATIONS
            RICHARD L. BROWN, CONTROLLER

                           introduction of Associates

        Senator Bennett. We will now go to the General Accounting
    Office.
        We welcome the General Accounting Office. I am not sure I
    have the right names here. I do not want to repeat my gaffe of
    last time.
        We have James Hinchman, who is the Acting Comptroller
    General of the United States, and he is accompanied by Mr.
    Dexter Peach, Assistant Comptroller General for Planning and
    Reporting; Ms. Joan Dodaro, Assistant Comptroller General for
    Operations; and Mr. Richard Brown, Controller.
        Thank you. We commend GAO for its ability to handle a 25-
    percent reduction in your budget over the past 2 years. I
    understand that that kind of downsizing can be painful. But in
    my visits with you, I have found you willing to accept it and
    implement it without complaint. That is kind of rare around
    here. We want to make it clear that it does not go unnoticed
    and unappreciated.
        You have maintained the number of products you produce,
    increased the timeliness of your jobs, and reduced the job
    duration and cost while absorbing that 25-percent cut. So it is
    appropriate that you are the watchdog of Congress. If you have
    been able to do it yourself now, go out and get them to do
    likewise, whoever the them may be in the circumstance.
        We look forward to your testimony.
        Senator Dorgan, do you have an opening statement for this
    group?
        Senator Dorgan. Mr. Chairman, I only want to observe that
    the GAO in my judgment does really outstanding work. The work
    that they have done for me and others and for the committees on
    which I have served has really been extraordinary work. I have
    felt a great regret in the past several years where on a number
    of occasions the GAO, I think, was unfairly victimized by
    statements by some in Congress--not many, but by a few. I think
    it unfairly characterized GAO's work.
        My own impression is that this watchdog agency provides the
    kind of service to Congress that we cannot get elsewhere. We
    spend through the Appropriations Committee well over $1
    trillion, over $1.5 trillion a year, and the ability to call on
    an agency like the GAO to evaluate how is this money spent,
    what the taxpayer gets for this expenditure is critical.
        I am not convinced that we did the right thing in making
    the kind of sizable cuts that were made. But the climate here I
    guess required that that be done. I just would express regret
    at some statements that have been made over the last several
    years which I felt were not fair.
        The GAO may be like every other agency. It may have its
    failings as well. It may be that I am not aware of these. But
    my own experience has been a first rate experience with this
    organization and I hope very much that we can find the
    resources to continue the GAO as the premier watchdog agency,
    that all of us can have confidence in and that we can continue
    to trust due to your important work.
        So, Mr. Chairman, thank you very much.
        Senator Bennett. Thank you.
        Mr. Hinchman.
        Mr. Hinchman. Thank you, Mr. Chairman. I have a prepared
    statement, and with your permission, I would like to summarize
    it briefly this morning, if that is acceptable.
        Senator Bennett. You have not only our permission but our
    encouragement.
        Mr. Hinchman. Thank you, Senator. I ask that my statement
    be put in the record.
        Senator Bennett. Without objection.

                            highlights of statement

        Mr. Hinchman. I only want to make two very brief points.
    First, I believe we are accountable to you for our stewardship
    of the taxpayers' dollars that you give us. I want to say a
    couple of words about this year's appropriation.
        As you pointed out, we are completing a downsizing of the
    agency primarily due to a 25-percent funding reduction over 2
    fiscal years. We are now below 3,500 staff. That is the lowest
    level since before World War II. It represents a one-third
    decrease from the 5,300 level where we were in 1992.
        I think we have downsized successfully and maintained our
    productivity and our contribution to the work of the Congress.
        We now have in place a spending plan for this year which is
    consistent with the 25-percent funding reduction, and we will
    successfully complete the downsizing this year within the
    funding which has been provided.
        The initial indications are that this year's performance
    will be equal to last year's, and that we will be able to
    maintain the productivity to which we have been committed in
    order to support the oversight and legislative agenda of
    Congress.
        So, overall, I think our report to you about our
    stewardship is a positive one. Our downsizing has been
    difficult, but successful, both in terms of reducing
    expenditures and in terms of maintaining institutional
    capability and level of service to the Congress.
        My second point is just a brief word about our 1998
    request. Having completed that downsizing, our goal now is to
    stabilize the agency and normalize its operations at the new,
    reduced level of staffing. For that purpose, we have asked for
    an increase over this year's funding.
        The most important part of that request is for our
    mandatory cost increases--those increases we cannot control.
    Essentially, those are statutorily mandated pay adjustments and
    statutorily and regulatorily mandated increases in the
    contributions that we make for employer retirement plans and
    employee life and health insurance plans.
        We know that resources continue to be limited and that you
    face difficult budget decisions. We are striving to be prudent
    stewards of our resources. But if we are to stabilize the
    agency and normalize its operations, we do need the resources
    to meet these uncontrollable cost increases.

                               prepared statement

        I think those are the two points that we have to make
    today. With that, let me stop, and any of us would be happy to
    answer any questions that you may have.
        [The statement follows:]
                    Prepared Statement of James F. Hinchman
        Mr. Chairman and Members of the Subcommittee: I am pleased to be
    here today to testify on GAO's fiscal year 1998 budget request. GAO has
    undergone major changes over the last few years, including significant
    cutbacks in people and resources. Our budget request for 1998 reflects
    needs that have resulted from some of those changes.
        The General Accounting Office was created to help ensure that
    taxpayers' dollars are wisely spent. We seek to fulfill this mission by
    encouraging honest, efficient management and full accountability
    throughout the federal government. We serve U.S. interests by providing
    Congress, other policymakers, and the public with accurate information,
    unbiased analyses, and objective recommendations on the use of public
    resources.
        The issues we examine span the breadth of national and
    international concerns, including health care, financial management and
    accountability, law enforcement and banking, information technology,
    national security, energy and the environment, aviation security,
    defense procurement, education and employment, transportation, tax
    administration, income security, housing, international relations and
    trade, and many others.
        About 78 percent of GAO's work during fiscal year 1996 was done at
    the request of Congress. GAO is required by law (Public Law 67-13) to
    do work requested by congressional committees and assigns equal status
    to requests from committee chairs and ranking minority members. More
    and more in recent years, congressional legislation has mandated GAO
    audits and evaluations, and to the extent possible within resource
    constraints, GAO also responds to requests from individual members.
    Finally, GAO undertakes assignments independently in accordance with
    its basic legislative responsibilities.
        While audits and evaluations are the most visible aspects of GAO's
    work and absorb the largest share of its resources, GAO has other
    important functions. We prescribe accounting standards for the entire
    federal government, in conjunction with the Office of Management and
    Budget and the Department of the Treasury, and issue generally accepted
    government auditing standards for all levels of government entities. We
    also issue legal decisions on matters involving government revenues and
    expenditures, such as protests against the award of federal government
    contracts.
                fiscal year 1996 accomplishments and highlights
        During the past year, we marked two important milestones. We bid
    farewell to Charles A. Bowsher, who retired as Comptroller General at
    the end of his 15-year term on September 30, and celebrated our 75th
    anniversary of service to Congress and the nation.
        GAO is proud of its long tradition of service to Congress, the
    contributions it has made toward improving federal government
    operations, and congressional actions based on GAO recommendations. In
    fiscal year 1996, GAO provided Congress and federal agencies with
    recommendations for measurable financial benefits and management
    improvements and with numerous testimonies, audit and evaluation
    products, and legal opinions.
        As a result of GAO's recommendations and audit findings, the
    legislative and executive branches took actions with financial benefits
    of over $17 billion. These actions included budget reductions, costs
    avoided, appropriation deferrals, and revenue enhancements that are
    directly attributable to or were significantly influenced by GAO's
    work.
        Further, we made other recommendations and documented audit
    findings that resulted in or contributed to improvements in the
    effectiveness and efficiency of government operations and services.
    Although these improvements cannot always be quantified in monetary
    terms, their impact is significant because they lead to a better-run,
    more streamlined government. Past experience shows that about 70
    percent of our key recommendations are implemented within 4 years,
    through the passage of implementing legislation and agencies'
    corrective actions.
        In all, we produced 1,306 audit and evaluation products. These
    products include 908 reports to Congress and agency officials, 217
    formal congressional briefings, and 181 congressional testimonies
    delivered by 68 GAO executives before 85 congressional committees and
    subcommittees. We also provided 29 statements for the record to
    congressional committees and subcommittees and produced 3,041 legal
    decisions.
            actions taken to absorb the 25-percent budget reduction
        As you are aware, our budget was reduced in fiscal years 1996 and
    1997 by a total of 25 percent from the 1995 level. Since employee
    compensation constitutes about 80 percent of our budget dollars, most
    of the actions taken to manage the budget reductions necessitated a
    loss of people. Today, as a result of those reductions, GAO's staffing
    is at its lowest level since before World War II.
        To manage the reduction in staff, we continued the hiring freeze
    which has been in place since 1992, obtained Congress' permission to
    pay ``buyouts'' to employees willing to leave voluntarily, and offered
    early-out retirement to eligible staff. Several hundred staff were also
    involuntarily separated as a result of the closure of three field
    offices and the elimination of many administrative, technical, and
    support positions, mostly at headquarters. In addition, GAO transferred
    its claims function to the executive branch. At the end of fiscal year
    1996, we had about 3,500 staff on board, which amounted to a 35-percent
    workforce reduction since fiscal 1992.
        In addition to reducing staff, we also substantially reduced
    funding in other areas. For example:
      --Promotions and awards were frozen during the last 2 years, and GAO
            has not funded bonuses since fiscal year 1992.
      --We reduced the amount budgeted for office rent by over $11 million
            through the closure of offices and the consolidation of local
            audit sites and offices at our headquarters building.
      --We reduced funding for travel, training, subscriptions, supplies,
            and equipment by almost 40 percent.
      --We have reduced funding for information management technology by 38
            percent since fiscal year 1995 and have deferred most of our
            capital investment.
        In all, funding reductions already taken at GAO will total over $1
    billion over the next 5 years.
                        fiscal year 1998 budget request
        Having worked hard to successfully implement this 25 percent
    reduction in our appropriations in fiscal years 1996 and 1997, we
    believe an increase in our funding is essential in fiscal year 1998 if
    we are to stabilize our organization and maintain our capacity to serve
    Congress effectively. We are therefore asking that the Subcommittee
    consider a fiscal year 1998 budget of $368,828,000 to support our staff
    of 3,500 people and an full-time equivalent staff level of 3,450. The
    increase included in this request is for five purposes: mandatory pay
    and benefits increases; price-level increases to cover the higher costs
    of transportation, printing, supplies, personnel services, and other
    essential mission support goods and services; pay-related costs for
    promotions and employee recognition, which we have foregone in recent
    years; information technology upgrades; and maintenance and repair of
    GAO's headquarters building.
        Mandatory pay and benefit increases are the most important piece of
    our request. Without the funding to cover uncontrollable costs such as
    locality pay, cost of living, and personnel benefits increases, we will
    have to reduce our staff level even further. The people who work at GAO
    are our most valuable resource, and a further reduction in staff will
    hamper our ability to maintain our current level of operations.
        It is also important to offset other uncontrollable inflationary
    increases, such as the higher cost of travel and transportation,
    printing, and supplies. Without the funding to cover these costs,
    further funding reductions will be necessary, impairing our capacity to
    function effectively.
        In addition, funding for promotions and employee recognition will
    help us to retain and recruit the talent needed to continue our support
    of Congress. We are losing many of our key people to executive branch
    agencies and professional firms offering pay incentives, such as
    promotions, bonuses, and awards, that GAO has been unable to offer for
    several years.
        Investment in our information technology program is needed to
    replace older and nearly obsolete computer equipment and software, as
    well as to upgrade our systems to support GAO's new reengineered job
    processes. While the network and data collection software applications
    are in place and fully operational, we need to upgrade workstations,
    software, applications, and network operating system hardware and
    software. We need these upgrades to ensure continued efficient
    operation and to maximize the productivity gains that information
    technology makes possible.
        Finally, the GAO building, built in the early 1950's, continually
    requires maintenance and repair to ensure a safe, healthy, and
    efficient work environment for our people.
                               concluding remarks
        For over 75 years, GAO has assisted the Congress in carrying out
    its legislative and oversight responsibilities, shifting its focus and
    updating its operations to accommodate changing congressional needs.
    Through the results of our work in many diverse areas, GAO has given
    Congress a high rate of return on its investment, in which Congress can
    take justifiable pride. Each year, GAO's goal is to identify at least
    $10 billion in financial benefits. Although this amount fluctuates from
    year to year, between fiscal year 1992 and 1996, financial benefits
    totaled over $103 billion, or nearly $50 for every dollar appropriated
    for GAO.
        We recognize, Mr. Chairman, that resources are limited throughout
    government. GAO is committed to holding down costs wherever possible,
    as our record demonstrates, and we have sought to be prudent in our
    budget submission. However, if GAO is to maintain its long tradition of
    service to Congress, the agency needs the resources necessary to
    maintain a strong and effective organization. This includes the funds
    necessary to pay for mandatory increases in people-related costs and
    increases in the prices of the goods and services we buy. We also need
    to address those capital investment and facility maintenance needs that
    should not be deferred.
        This concludes my statement. We would be happy to answer any
    questions the Members of the Subcommittee may have.

                            GAO building usage study

        Senator Bennett. Thank you.
        I would like to talk about your building. I understand from
    my visit there that you have one floor that presumably you
    won't need.
        Mr. Hinchman. That's correct.
        Senator Bennett. Also you have an asbestos removal problem
    on that floor. Does it make sense for you to do an internal
    study of yourself on this and report back to the House and
    Senate as to whether or not you will eventually need that
    space, or the alternative of having a tenant move in there and
    charge the tenant for the cost of the asbestos removal and the
    renovation? Or have you already come to a determination as to
    which way you think you ought to go?
        Mr. Hinchman. I think we ought to do the study and report
    back to you.
        Obviously, the original plan for the renovation of the
    building was developed at a time when we were a larger agency.
    As you correctly point out, it is now clear that we will not
    need one floor of the facility, and I think it is appropriate
    for us to examine all of the alternatives for the use of that
    floor and to report to you. I think we can do that in a
    relatively brief period of time.

                        Consolidated financial statement

        Senator Bennett. OK. Under the Chief Financial Officers
    Act, the CFO Act, you have been very involved. Do you have any
    summary you can give the committee on your experience with this
    act and how you are fulfilling your responsibilities? Any
    general observations about how it is working?
        Mr. Hinchman. The goal of the Chief Financial Officers Act,
    as you are aware, Mr. Chairman, is to get the financial
    management and reporting of the Federal Government in order. I
    think that basically means bringing to it the discipline that
    has characterized financial management and reporting in the
    private sector, and in State and local government, for that
    matter, for decades.
        In order to carry out that responsibility, we are pursuing
    three major initiatives. First, we are working with OMB and
    Treasury to develop standards for financial management and for
    accounting and auditing of those financial systems. Second, we
    are working with the inspector general community and OMB to
    develop a comprehensive plan for auditing those financial
    reports. That is going to take a large effort, not only by us
    but by the inspector general community and by private
    accountants as well, working under contract for the inspectors
    general. Then, finally, we are doing some of the most important
    agency audits ourselves. We are currently auditing major
    components of the Treasury Department, for example, and major
    financial management issues in Defense.
        Hopefully, out of all of that will come a consolidated
    financial statement for the United States next spring. I think
    everyone is committed to that goal, and we will be required to
    render an opinion on that statement.
        I think that will be an important milestone. I don't know
    what that opinion is going to say. But I do know that we will
    have made enormous progress toward the goal of providing the
    kind of accountability for our financial resources that we
    expect of private companies in this country and that the market
    demands of State and local government.

                                Biennial budgets

        Senator Bennett. I was very impressed by the testimony of
    Mr. Raines before the Governmental Affairs Committee. He
    addressed this issue. The subject was the question of a 2-year
    budget. He said if you give me a 2-year budget, I can then put
    the ``M'' into ``OMB.'' Right now I do nothing but the ``B.''
        Coming from the private sector, as he does, he said that
    the idea of an annual close of books is terrifying to many of
    these agencies. Where I come from, you want a monthly close,
    which is just beyond conception. [Laughter.]
        Mr. Hinchman. Yes.
        Senator Bennett. I was enormously impressed with him. Based
    on that brief experience, I am telling people he is the most
    impressive Director of OMB of either party that I have ever
    seen. I am delighted to hear you say that you are working
    closely in that effort.
        Mr. Hinchman. Yes; and with him and with Mr. Koskinen, his
    deputy for management.
        Senator Bennett. Senator Dorgan.

                   process for selecting Comptroller General

        Senator Dorgan. Mr. Hinchman, you have been serving as the
    Acting Comptroller General since September of last year.
        Mr. Hinchman. Yes, sir; since September 30.
        Senator Dorgan. Is the process underway to find a permanent
    successor to Mr. Bowsher? Can you describe where we are in that
    process?
        Mr. Hinchman. Under the statute, a commission composed of
    10 congressional leaders is responsible for developing a list
    of individuals to recommend to the President for the
    Comptroller General position. That commission is composed of
    the President pro tempore of the Senate, the Speaker of the
    House, the majority and minority leader of each House and the
    chair and ranking minority member of our two oversight
    committees, Governmental Affairs in this body and Government
    Reform and Oversight in the other body.
        From that list, the President either selects a name or
    sends the list back for further names. Once he has found a
    person he finds acceptable, he then nominates that person who
    then goes through a full confirmation process before the
    Senate.
        The commission has not yet met. However, there have been
    discussions among both members of the commission and their
    staffs, laying the groundwork for that process.
        Senator Dorgan. I guess you probably cannot answer this,
    but it is bizarre to me that 9 months after Mr. Bowsher left,
    the commission established to, at least, recommend names has
    not even met.
        Mr. Hinchman. I leave it to the members of the commission
    to decide what their schedule is.
        Senator Dorgan. I did not really expect you to answer that
    question.
        Mr. Hinchman. I have spent the last 6 months throughout our
    agency talking about our responsibilities during this interim
    period. I think we see ourselves, all 3,500 of us, as trustees,
    stewards accountable to this committee and to others for our
    management of this agency over this interim period. We leave it
    to you to decide when it is time for us to have a new
    Comptroller General and who that new Comptroller General should
    be.
        Senator Dorgan. That was very diplomatic. [Laughter.]

                   need for Congressional commission to meet

        It seems to me, though, Mr. Chairman, that we ought to
    begin to stimulate and agitate. The leadership of an agency, of
    any agency, is important. I am not suggesting that there is not
    now leadership. But establishing a permanent solution for
    leadership is very important.
        It appears to me that there has been a dropping of the ball
    here if, after 9 months, we do not even have a commission
    meeting and making some recommendations.
        I don't know what the reason for that might be. But maybe
    you and I should look into this.
        Senator Bennett. I don't know, either. But I agree with you
    completely. I understand that in this circumstance, the statute
    says the old Comptroller General cannot serve until his
    successor is in place. He serves for--is it 15 years?
        Mr. Hinchman. Yes, sir.
        Senator Bennett. The 15 years is up and then he is gone. So
    you don't have here the circumstance that you have elsewhere
    where the person can hang around until his successor is in
    place.
        I am as appalled as you are and agree with you that we
    probably ought to start stimulating our respective leaders.
        Senator Dorgan. Perhaps we could agitate with a joint
    letter indicating that this commission which, apparently,
    exists should meet and should make recommendations. I think
    there should be a goal here established of, at least, by 1 year
    after Mr. Bowsher has left that a leader be selected for the
    GAO.
        I don't have other questions. Again, I appreciate the work
    of the General Accounting Office. I will continue, as a Member
    of Congress, to call on you and rely on the services that you
    provide for us. We appreciate very much your work.
        Mr. Hinchman. Thank you, sir.

                               Year 2000 problem

        Senator Bennett. We will have some other questions that we
    will submit to you in writing.
        So that we have a degree of continuity through this whole
    hearing this morning, let me ask you about the year 2000
    problem and how you are prepared to deal with it and if you
    have any money in this 1998 request for that.
        Mr. Hinchman. We have included within our strategic plan
    for information and resource management a solution to the year
    2000 problem. We are addressing that problem, both by making
    the changes that we need to make in software which we expect to
    continue to have in use by the time we reach 2000, and by
    assuring that software which we acquire for replacement
    purposes between now and then does not include that problem.
        I feel comfortable that we have that problem under control.
        We are also, by the way, doing an extensive amount of work
    in assisting executive branch agencies in addressing that
    problem as well, and have a large body of work underway to
    identify where that problem exists and how it can be solved.

                         Additional committee questions

        Senator Bennett. Thank you very much for coming in. Thank
    you for all you do.
        I share Senator Dorgan's admiration for the work product
    you produce.
        Mr. Hinchman. Thank you, Mr. Chairman.
        [The following questions were not asked at the hearing, but
    were submitted to the Office for response subsequent to the
    hearing:]
                         Additional Committee Questions
        Question. What is the status of your downsizing efforts?
        Answer. In fiscal year 1997 GAO completed its downsizing efforts,
    which began in fiscal year 1992 with a GAO-wide hiring freeze. Since
    fiscal year 1992, we have dropped from about 5,325 to about 3,500
    staff--a reduction of approximately 34 percent. To accomplish this
    reduction of more than a third of our staff, we conducted two voluntary
    separation incentive programs involving buyouts and early outs; closed
    12 field offices and 2 overseas locations; reduced administrative,
    professional and support staff through a reduction-in-force (RIF); and
    transferred the claims adjudication function and staff to the executive
    branch.
        In anticipation of becoming a smaller organization, we began in
    1995 to re-design our job processes, with a goal of producing quality
    work more quickly and at lower cost. This was a project we had been
    working towards for several years. The budget climate provided added
    incentives to continue to assess how we do our work and how we can get
    it done employing fewer and fewer resources.
        Our production shows that we are clearly doing more with less--our
    staff is working harder and more efficiently, and we are taking
    advantage of available technology. After completing the downsizing, we
    believe that our diminished resources are better aligned (headquarters
    issue areas and regional core groups) and better balanced (support
    staff versus mission staff).
        Because of the downsizing, we have been able to bring all our staff
    back from audit sites and temporary space into the main GAO building
    without having to complete asbestos removal and renovation of all seven
    floors of the GAO building.
        Our fiscal year 1998 budget request reflects funds needed to
    stabilize the agency and return to ``normal'' operations. A first step
    to returning to normal was to reinstate human resource systems that had
    been frozen or otherwise stopped in recent years. We lifted a 5-year
    hiring freeze, and have added a few staff to fill critical specialized
    vacancies. We also had a limited round of promotions, ending a 2-year
    freeze.
        We need to continue to upgrade technology (workstations, software
    applications, and network system hardware) to allow staff to maximize
    the productivity gains that information technology makes possible.
        We also need to complete work on abating and renovating the GAO
    building to make it a more positive work environment for our staff.
        In addition, we have requested funding to reinstate our employee
    awards and recognition system, which we have not used since 1992, and
    to implement a revised incentive awards program, dormant for several
    years. If we are able to accomplish these initiatives, we may be able
    to stem the tide of key people leaving GAO for positions with executive
    branch agencies and professional firms offering these incentives.
        Question. Last year the committee recommended that GAO produce an
    assessment of its downsizing experience, including lessons learned and
    recommendations that could be helpful in other downsizing situations.
    Please summarize that assessment.
        Answer. As GAO experienced its downsizing, we learned several
    lessons that might prove useful to other agencies facing similar
    circumstances. Of primary importance was advance knowledge and
    foresight regarding the nature and extent of pending reductions which
    allowed GAO to plan actions to maintain productivity and efficiency,
    and to take advantage of emerging technological capabilities, while we
    reduced personnel and operating costs. We believe it is vital to make
    necessary decisions quickly and decisively and ensure they are
    communicated to affected staff. Once downsizing actions are complete,
    it is important to stabilize the organization and return to normal
    operations as quickly as possible. A discussion of our experiences were
    included in a letter, dated May 16, 1997, to the Chairman, Committee on
    Appropriations, Subcommittee on the Legislative Branch, United States
    Senate.
                           letter from joan m. dodaro
    Assistant Comptroller General of the United States,
                                     General Accounting Office,
                                        Washington, D.C., May 16, 1997.
    The Honorable Robert F. Bennett,
    Chairman, Subcommittee on the Legislative Branch, Committee on
            Appropriations, United States Senate.
        Dear Mr. Chairman: During our 1997 Senate appropriations hearings,
    the Committee recommended that GAO produce an assessment of our
    downsizing experience, including lessons learned and recommendations
    for similar or different procedures in different situations. This
    letter responds to that request.
        As you know, in July 1995, the Committee committed to reducing GAO
    funding by 25 percent from fiscal year 1995 levels by the beginning of
    fiscal year 1997, a period of about 14 months. We were fortunate that
    the Congress allowed us to spread the cuts over two fiscal years, and
    that we were given the authority to develop new reduction-in-force
    (RIF) regulations allowing us to minimize disruption to our operations.
        To operate under this reduced budget, we had to lower our staff
    level from about 4,350 to 3,500 staff. This was successfully
    accomplished (as of September 30, 1996, GAO had 3,492 staff on board)
    through an early out/buyout program, the transfer of our claims
    function to other agencies, the closure of three field offices, a RIF
    of support staff, and normal attrition. To meet our staffing objective
    while maintaining a high level of productivity, we re-engineered our
    work processes and enhanced our use of technology. This enabled us to
    successfully perform our mission responsibilities while adjusting to a
    dramatically smaller workforce. As we implemented these changes, we
    learned several lessons that might prove useful to other agencies
    facing similar circumstances.
    Anticipate Change
        By the early 1990's, it was becoming clear that budgetary restraint
    was necessary. After discussion with our Appropriations Committees, and
    facing an uncertain financial future, we began to take steps to reduce
    both personnel and operating costs. To reduce personnel costs, we
    initiated a hiring freeze (begun in 1992); conducted an ``early-out/
    buyout'' program (1993) during which about 400 staff left voluntarily;
    and closed 8 field office locations (1993). To reduce other operating
    costs, we introduced videoconferencing GAO-wide (1993) which reduced
    travel costs; and subsequently connected all GAO offices agency-wide
    computer network and voice message telephone system, reducing the need
    for some support functions and staff.
        All these steps were taken or underway prior to the 25 percent
    budget reduction. Had we waited until the 25 percent cuts were
    finalized, our position during the ensuing reductions would have been
    much more difficult, requiring a much larger involuntary reduction-in-
    force. Accordingly, it might be wise for agencies to anticipate
    reductions and take cost-cutting steps before they are mandated.
    Move Quickly and Decisively
        In June 1995, the Comptroller General appointed a high level team
    of managers to assess the impact of potential funding reductions, and
    to recommend how to downsize the agency. The team was given a short
    deadline, reporting back in late July. On August 7, 1995, the
    Comptroller General adopted the recommendations, which included closing
    three additional field offices, offering buyouts and early outs as
    approved by Congress, and a RIF of support staff. These recommendations
    were sudden, dramatic, and quite sobering.
        At the same time, the Comptroller General issued a memo to all
    staff outlining the downsizing steps that would follow. The memo also
    established time periods for each activity and assigned responsibility
    for carrying out the recommended tasks. Throughout late 1995 and all of
    1996, this timetable was adhered to scrupulously. Management
    decisiveness and determination was an important ingredient in
    efficiently and effectively implementing a painful set of decisions
    which cost hundreds of effective and productive staff their jobs.
    Ensure Constant, Effective Communication
        In the year leading up to the major downsizing announcement, GAO
    had attempted to keep employees informed about events in Congress that
    could affect the agency, especially its funding levels. The normal
    means were used: staff meetings, memoranda, electronic mail, and video
    conferences. Unfortunately, in the midst of congressional budget
    deliberations, and before Congress had finalized our funding level,
    misinformation and rumors often outnumbered facts.
        Once the downsizing plan was announced, an extensive agency-wide
    communications strategy was established to communicate the truth.
    Initially, the focus was on the recommendations of the downsizing team,
    especially to those in the most adversely affected units. The Senior
    Executive Service (SES) core was educated on the plan to help them
    effectively address staff concerns. Numerous meetings and briefings
    were held so that all staff could learn about the downsizing firsthand
    from the implementing managers and ask questions as it moved forward.
    In addition, the team that was established to develop new RIF
    regulations held a first round of briefings for all interested staff to
    learn of their concerns and then a second round to describe proposed
    regulations and obtain staff comments on them.
        Technology was a big asset in communicating quickly and efficiently
    all personnel. Important information, including draft RIF rules was
    posted on the agency-wide computer network, making it immediately
    available, unfiltered, to everyone. Similarly, telephone voice mail
    served us well in communicating efficiently.
    Ensure Personnel Records and RIF Rules are Up-to-date
        Key components in a RIF include the RIF rules, staff position
    descriptions, employee appraisal scores, and other employee information
    such as veteran's status and employment dates. For agencies
    anticipating a RIF, it is imperative that RIF regulations and employee
    data are up-to-date and accurate. It is also important to insure that
    the information is verified well in advance of the RIF, and that last
    minute changes to position descriptions or job assignments are not
    made. Inaccurate employee records, or assignment changes increase the
    mistrust in an already negative atmosphere, and can lead to legal
    challenges.
    Educate Managers About RIF Ramifications
        A RIF is traumatic not only to the affected staff, but also to the
    managers who deliver the bad news. The way managers deal with RIFed
    staff can affect the implementation of the RIF. GAO briefed the
    managers in the units where the RIF's were to occur on what was going
    to happen. Our Office of Counselling and Career Development briefed
    these managers on what reactions to expect from employees, and
    distributed a handbook suggesting ways to handle emotional reactions
    and potential security issues. The handbook also contained numerous
    questions typically asked by staff facing a RIF, and suggested
    responses to various situations. We believe that preparing our managers
    in this way contributed to the relative lack of problems in our RIF.
    Provide Assistance to Affected Staff
        The most difficult aspect of downsizing was the traumatic affect it
    had on hundreds of individuals who had served GAO well over the years.
    The agency contacted each RIFed employee and offered them a full range
    of services, including counseling, job search and development, resume
    assistance, outplacement, and other services to staff affected by the
    downsizing decisions, both in headquarters and the closing field
    offices. The services started shortly after the August announcement was
    made, and continued until about three months after the last
    involuntarily separated staff had left the agency. Most of the eligible
    staff took advantage of the services. Information available to us
    indicate that the services helped many former staff members make a
    successful transition to other employment.
        In addition to outplacement and career counselling services, GAO
    provided detailed information to staff on severance pay and retirement
    benefits that would accrue to those who were RIFed or left
    voluntarily--information vital to helping them choose the best option
    for them.
        Providing such information and services is obviously important for
    the people whose lives have been disrupted by job loss. It is also
    important to those who remain to know that their colleagues are
    receiving assistance.
    Return Human Resource Functions to Normal as Soon as Possible
        Anticipating reduced funding levels, GAO took numerous steps
    outlined above. In addition, we eliminated our pay-for-performance
    system bonuses in 1993, and froze promotions and reassignments in 1995
    and 1996. In essence, several of our human resource functions were
    temporarily suspended. We believe it is necessary for the morale of the
    remaining staff to return human resource functions to normal operation
    as quickly as possible after the RIF. In GAO's case, in March we
    promoted evaluators for the first time in 2\1/2\ years, and have begun
    hiring a limited number of specialists and technical experts to replace
    attritions.
        GAO has emerged from a dramatic reduction ready and able to provide
    quality service to the Congress. We have taken steps to further
    streamline our job management processes to allow us to be more
    responsive to the Congress and to maintain our productivity. Smaller
    than at any time since World War II, we have been able to retain the
    integrity and efficacy of the agency, as we look forward to future
    challenges.
                Sincerely,
                                                Joan M. Dodaro,
                          Assistant Comptroller General for Operations.

        Question. Over the past few years the GAO has been making large
    investments in technology. How much has GAO spent on Information
    Technology since fiscal year 1996?
        Answer. Our information technology budget funds a variety of
    services, under lying agency operations, including mainframe computing
    services for administrative systems, local and long distance voice
    communications, video conferencing services, network customer support,
    and maintenance and support for hardware and software. In fiscal year
    1996, GAO spent $24.7 million on information technology (IT). The
    current estimate for fiscal year 1997 IT spending is $21 million.
        Since fiscal year 1996, GAO has spent very little on IT
    investments, deferring most technology investments because of budget
    limitations. We have restricted our investments to critical hardware
    and software purchases to support GAO's network and improve network
    management and labor support for (1) upgrades to the data collection
    and analysis application and (2) preparatory efforts to convert our
    network operating system to Novell's Netware 4.x, our desktop operating
    system to Windows 95, and applications suite to Office 97, replacing
    our existing, but obsolete, installed base of software (e.g.,
    WordPerfect 5.2, which is no longer supported by the vendor).
        Investments in earlier fiscal years (specifically, dating back to
    fiscal year 1992), allowed GAO to implement a wide area computer
    network linking staff throughout the agency; integrate video-
    conferencing and voice mail into its operations; implement an automated
    data collection and analysis application streamlining routine audit
    assignment tasks and providing greater access to GAO workpapers;
    reengineer the audit process to streamline the way work is done and
    ensure consistent high quality products; and publish and distribute GAO
    reports electronically on the Internet. Because this technology was in
    place, GAO was able to reduce the average cost of jobs, increase the
    percentage of products delivered on time, improve product quality, and
    increase measurable financial benefits resulting from GAO's audit
    findings and recommendations--despite significant budget and staffing
    reductions.
        Question. What is GAO requesting in the fiscal year 1998 budget for
    technology?
        Answer. GAO is requesting $5.1 million for crucial investments
    needed to operate and maintain GAO's technology base. The increase
    would be targeted primarily to (1) replacements of and/or improvements
    to aging microcomputer workstations and network hardware (such as
    servers, routers and storage devices), (2) completion of efforts to
    migrate GAO to Windows 95 and MS Office 97, and (3) initial design
    efforts to migrate some of GAO's administrative systems from costly
    mainframe systems to a client/server environment. The investments are
    necessary for GAO to ensure efficient operation and maximize
    productivity gains and timeliness made possible through technology--and
    to continue to be responsive to congressional information needs.
        Question. Has video conferencing saved enough travel money to
    offset its costs?
        Answer. GAO has installed video conferencing in headquarters and
    all its field offices and has a pilot on desktop video in Seattle,
    Portland, Richland, and Sacramento. GAO uses video conferencing in
    carrying out mission work and for training and other administrative
    activities. In terms of mission work, video conferencing has allowed
    dispersed workgroups in headquarters and field offices to conduct
    meetings--focusing on key decision points in an audit assignment,
    coordination between audit sites, and development and review of
    briefing documents and draft reports without the need to travel. In
    addition, GAO has used video conferencing to coordinate with other
    government agencies and the Congress. GAO has also used video
    conferencing for training and found the approach both timely and
    effective. And, GAO uses video conferencing for management and
    administrative matters, such as staff meetings, when it is cost
    effective to do so.
        GAO has conducted two assessments of its videoconferencing program.
    The assessments found videoconferencing an effective means of helping
    GAO accomplish its mission and identified benefits, including
    significant savings in travel costs and time. Participants in the
    assessment reported that video conferencing was typically as effective
    as traveling to meet ``in person.'' Participants also reported
    extensive non-quantifiable benefits that enhance product quality and/or
    reduce cycle time. They include having key decision makers present at
    the same time, enabling developmental staff and specialists to be
    present, making decisions in a more timely manner, improving
    coordination and teamwork between sites, avoiding potential rework, and
    providing more timely training. Our assessment report covering fiscal
    1993 noted that GAO avoided 650 days of travel time and approximately
    $400,000 of travel expenses during that period. While these figures
    have not been updated, given the increased usage of video conferencing
    and increased costs to travel, the dollar savings should be even
    greater. (Current agency-wide operating costs--which include
    maintenance, technical support, as well as recurring and usage charges
    for telecommunications services--are $750,000.)
        Question. Much of GAO's work is done at the request of the
    Congress--either by statute or individual request. Of the total number
    of jobs completed last year, how many were statutorily required and how
    many were requested by Members or Committees?
        Answer. During fiscal year 1996, GAO issued 1,306 audit and
    evaluation products. Of these products, 1,139 or 87 percent were
    requested by committees or members of Congress (1,021), or mandated
    (118). The remaining 167 or 13 percent resulted from important, self-
    initiated work undertaken as part of GAO's basic legislative
    responsibilities.
        During fiscal year 1996, 78 percent of GAO's available audit
    resources were spent on work requested by the Congress and 22 percent
    on self-initiated work.
        Question. Once a request is made, does GAO make a determination as
    to what jobs should be done and what jobs should not be done?
        Answer. The source of a request for GAO work is a major factor in
    determining what jobs should be done. In this regard, GAO is required
    by law to respond to legislative mandates and to undertake work
    requested by congressional committees. As a matter of policy, GAO
    assigns priority to requests from both committee chairs and ranking
    minority members. Requests from individual Members are undertaken to
    the extent resources are available. GAO also undertakes important self-
    initiated work. The ability to pursue such issues that auditors or
    investigators uncover in the course of their work is essential to the
    maintenance of generally accepted standards of independence and
    impartiality. Such self-initiated work has been instrumental in
    alerting the Congress to emerging problem areas ranging from the
    identification of growing problems in the thrift industry in the mid-
    1980's to more recent work highlighting the need for management reforms
    in federal programs especially susceptible to waste, fraud, abuse, and
    mismanagement.
        GAO's planning process also guides decisions on which assignments
    to pursue. GAO has developed an agency-wide strategic plan that
    emphasizes several broad areas of importance to guide the work of the
    entire agency for the next two or three years. In addition, each of
    GAO's issue areas prepares multi-year strategic plans after consulting
    with congressional staff (both majority and minority) agency, academic,
    industry, and other experts to identify important national issues.
    Decisions on assignments included in these plans are influenced by such
    factors as the extent of congressional interest, the possibility for
    cost savings, and the potential for significantly improving government
    programs.
        Question. Do you inform requesters of the cost of their request
    before the work is performed?
        Answer. GAO has reengineered its job management process using best
    practices found in the public and private sectors to increase its
    efficiency and to enhance its ability to produce timely, high quality
    products at reduced cost. For congressional requesters, the new process
    means greater focus on them and a more business-like working
    relationship. Requesters receive a prompt response and GAO meets with
    them early in the process to reach agreement on the scope, approach,
    and associated resource implications of completing requested work. GAO
    follows up the meeting with a written commitment to deliver its work
    within agreed-upon timeframes.
        Using its new job management process, GAO has substantially reduced
    an assignment's average and median duration and cost, while increasing
    significantly its ability to meet the date it commits to for producing
    a product. For example, the median duration of a GAO assignment in
    fiscal year 1996 has decreased by 18 percent when compared to fiscal
    year 1995 and 47 percent when compared to fiscal year 1994. Similarly,
    the median cost of a GAO assignment has decreased by 19 percent and 40
    percent, respectively. GAO expects further improvements in these
    efficiency measures as more of its jobs go through, and benefit from,
    the redesigned process.
                                     ______

                  Questions Submitted by Senator Byron Dorgan
        Question. Please specify the consequences if GAO received no
    additional funding or a funding reduction in fiscal year 1998.
        Answer. Faced with the twenty-five percent funding reduction over
    fiscal years 1996 and 1997, GAO developed a plan in concert with
    Congress to reduce agency staffing to 3,500. To achieve this reduction,
    we maintained the hiring freeze imposed in 1992, managed an early
    retirement program, offered separation incentives to staff willing to
    retire or leave GAO, closed several field offices, transferred
    functions and staff to the Executive Branch, and conducted a reduction-
    in-force for administrative and support staff. During this time we also
    reengineered our work processes and benefited from technology
    enhancements made in prior years, thus helping us maintain productivity
    as we downsized.
        This plan was executed with the understanding that at the end of
    the 2-year period, we would stabilize at 3,500, promote and reward
    staff, undertake necessary technology improvements and become a
    smaller, more stable organization. The downsizing plan did not allow
    for reductions below the 25 percent level. To absorb mandatory pay
    increases and uncontrollable price increases or further, unplanned
    reductions would seriously affect our ability to maintain our current
    workload and meet the needs of our congressional customers.
    Zero Additional Funding
        In considering the various funding scenarios, it is important to
    realize that, to stay even, GAO's fiscal year 1998 budget would need to
    be increased by about $18 million just to fund mandatory increases in
    personnel and other uncontrollable costs such as pay raises and the
    anticipated, January congressionally-approved increase in agency
    retirement contributions.
        Because of these mandatory increases, level funding would seriously
    impact GAO's ability to serve the Congress. GAO would lose much of what
    remains of its flexibility in undertaking assignments for congressional
    committees. In many issue areas, we would likely be forced to extend
    waiting times before we could begin assignments and we would find it
    difficult to respond to requests for rapid turn-around evaluations.
        On the personnel side, level funding would mean that GAO could only
    support a staffing level somewhat under 3,300--more than 200 full-time
    equivalent staff below our authorized level. GAO would maintain the
    hiring freeze imposed in 1992, and continue the freeze on awards and
    recognition programs imposed in fiscal year 1993. We would be unable to
    correct the skills imbalance in specialized areas created through
    continued downsizing. Funding for technology would be limited to a
    maintenance level, while not allowing needed upgrades to keep pace with
    technological capabilities widely available in the private sector and
    other agencies of the government. Additional reductions will be imposed
    in all program areas, which affect staff morale and our ability to
    maintain productivity levels, and our need to retain qualified,
    motivated staff.
    A Funding Reduction
        A funding reduction would begin to erode GAO's ability to carry out
    its statutory responsibility to serve the committees of Congress.
    Serious imbalances in GAO staff resulting from such a reduction would
    make our ability to undertake assignments problematic; some assignments
    would have to be refused for lack of expertise or lack of personnel to
    carry them out, and waiting times would increase. More specifically,
    further staff erosion, combined with an inability to replace lost staff
    expertise in technical areas like information management technology and
    accounting would place GAO's mandated financial audit work as well as
    work on high risk information systems at risk.
        A funding reduction in fiscal year 1998 would necessitate
    reductions in GAO's staffing level. The continued hiring freeze, our
    inability to promote and reward good staff, and the necessary budget
    cutbacks in technology, training, and travel would almost certainly
    have a significant negative effect on staff morale. The likely outcome
    would be increased attrition of our most skilled staff and further
    serious delays in getting the agency back to normal operations.
        Question. GAO is required by law to respond to legislative mandates
    and to undertake work requested by congressional committees and the
    majority of its resources are devoted to these purposes. GAO also has
    authority to conduct self-initiated work as part of its basic
    legislative responsibilities.
        Why is it important for GAO to be able to conduct some work on a
    self-initiated basis?
        What benefits have resulted from GAO's self-initiated work in prior
    years?
        Answer. Over the past several years, the proportion of GAO's
    resources spent at the specific request of the Congress has ranged from
    70 to 80 percent of available audit resources. The remaining audit
    resources are devoted to important, self-initiated work undertaken as
    part of GAO's basic legislative responsibilities. Specifically, during
    fiscal year 1996, 78 percent of GAO's available audit resources were
    spent on work requested by the Congress and 22 percent on self-
    initiated work. Although there is no congressional sponsor at the start
    of GAO's self-initiated work, the majority of this work is ultimately
    addressed to congressional committees because of their interest and
    legislative or oversight responsibilities.
        Self-initiated work is essential to any audit organization. The
    ability to pursue issues that auditors or investigators uncover in the
    course of their work is essential to the maintenance of generally
    accepted standards of independence and impartiality. Self-initiated
    work undertaken by GAO has been instrumental in alerting the Congress
    to emerging problem areas and has provided information and analysis on
    some of the most pressing matters faced by the Congress such as the
    growing problems in the thrift industry in the mid-1980's, the more
    recent gaps and weaknesses in the regulation, accounting, and
    management of derivative products, and serious financial management
    systems and information problems across government. Every year, this
    work leads to significant financial benefits and improvements in the
    efficiency and effectiveness of government operations.
        Question. The Health Insurance Portability and Accountability Act
    (better known as Kassebaum/Kennedy) enacted last August requires that
    GAO contract for a comprehensive study of the effects of Medical
    Savings Accounts (MSA's), both on the individual and small group health
    insurance markets. GAO is to report to Congress not later than January
    1, 1999.
        What is the nature of the study, and what is its status?
        Answer. The Health Insurance Portability and Accountability Act
    (Public Law 104-191) requires that GAO contract with an organization
    with expertise in health economics, health insurance markets, and
    actuarial science to conduct a comprehensive study regarding the
    effects of medical savings accounts in the small group market on: (1)
    selection, including adverse selection, (2) health costs, including any
    impact on premiums of individuals with comprehensive coverage, (3) use
    of preventive care, (4) consumer choice, (5) the scope of coverage of
    high deductible plans purchased in conjunction with such accounts and,
    (6) other relevant items.
        In order to provide the best possible information to Congress about
    MSA's, we designed a study that consists of 4 parts: A study of
    insurers; A study of MSA enrollees; A study of financial institutions;
    and A study of small employers.
        In February 1997, we issued a Request of Proposal to firms having
    the competence and necessary experience to perform this complex work.
    In early April, we completed the proposal evaluation process and
    qualified four firms to bid on task orders to perform this work; these
    firms are well-known for their experience in the conduct of large scale
    health insurance-related surveys and analyses.
        We also completed and awarded the first two of what we anticipate
    as at least six task orders. At this time, work is underway on the
    survey of insurers, and the design of the survey of MSA enrollees. We
    expect to provide Congress preliminary information on the MSA insurance
    market in the fall of 1997.
        Question. Downsizing an organization the size of GAO can be a very
    complex management task. People don't always leave from the places that
    are most beneficial. Are your people able to move effectively from one
    area of expertise to another, or are you finding some areas where
    expertise is becoming very thin? If you are not able to hire for
    another year, and in fact have to reduce staff even more, will there be
    some functions critical to GAO's mission that will not be able to
    operate?
        Answer. The closure of three regional offices as well as many
    suboffices, the elimination of one headquarter's division, the
    retirement of many experienced staff, and the reduction-in-force of
    almost thirty percent of our support staff have resulted in many staff
    reassignments throughout the agency. However, one of the impacts of the
    downsizing has been the disproportionate loss of employees who are
    skilled in technical areas. For example, we have reassigned staff from
    other parts of the organization into technical positions such as
    accountants, financial systems specialists and information systems
    analysts wherever possible, but we have not been able to compensate for
    the loss of capability experienced in these critical disciplines over
    the past four years. It has now reached the point where we must hire
    some additional staff with the right skills from outside GAO if we are
    to meet our responsibilities under the Chief Financial Officers Act and
    properly support Congressional efforts to reform the government's
    financial and information management systems. We also need to begin to
    develop a strategy for hiring other technical experts in certain areas
    where we have critical staff shortages, such as statistics and health
    care. Although this re-balancing effort will take some time, it is
    essential that we begin this fiscal year.
        If GAO maintained the hiring freeze imposed in 1992, we would be
    unable to correct the skills imbalance in specialized areas created
    through continued downsizing. Further funding reductions would begin to
    erode GAO's ability to carry out its statutory responsibility to serve
    the committees of Congress. Serious imbalances in GAO staff resulting
    from a further funding reduction would make our ability to undertake
    assignments problematic; some assignments would have to be refused for
    lack of expertise or lack of personnel to carry them out, and waiting
    times would increase. More specifically, further staff erosion,
    combined with an inability to replace lost staff expertise in technical
    areas like information management technology and accounting would place
    GAO's mandated financial audit work as well as work on high risk
    information systems at risk.
                           NONDEPARTMENTAL WITNESSES

    STATEMENTS OF:
            JANET S. ZARGORN, CHAIR, AMERICAN BAR ASSOCIATION STANDING
                COMMITTEE ON THE LAW LIBRARY OF CONGRESS
            HON. BILL ORTON, FORMER U.S. REPRESENTATIVE FROM UTAH

        Senator Bennett. I understand there is one additional
    witness. Senator Dorgan has to leave, but I am happy to welcome
    an old friend.
        We welcome Janet Zargorn from the American Bar Association,
    accompanied by former Congressman Bill Orton, who is always
    welcome.
        We understand you have an issue you want to raise with the
    committee regarding the Library of Congress and we will be
    happy to receive whatever you have to tell us.
        Ms. Zargorn. Thank you. I am the chair of the American Bar
    Association Standing Committee on the Law Library of Congress.
    On behalf of the ABA I want to thank you, Mr. Chairman, for
    allowing me to make this very brief remark.
        The Standing Committee on the Law Library of Congress was
    created 60 years ago to support the Law Library of Congress'
    goal and mission. It is an institution which we believe is the
    preeminent legal resource in the entire world.
        I know you have already heard their appropriation request
    this morning from Dr. Billington. So I will summarize my
    remarks.
        We believe that the Law Library of Congress is one of the
    critical institutions in preserving American democracy and that
    the Library of Congress and the Law Library in particular serve
    Congress as its research arm in many ways. But it also serves
    the public. Right now, it is engaged in a very unusual
    challenge, which is trying to help many of the emerging nations
    and countries of the world to access their own statutes and
    regulations and, in fact, use the U.S. democratic process and
    our legislative process as a role model.
        I am a law librarian, so as a law librarian, I can say that
    I think, as we sit on the edge of the digital century, it is
    critical to cost effective research, but certainly to
    increasing access to information that we use technology. I
    think that the Law Library of Congress through its global legal
    information network has really assumed a leadership role. I am
    very proud of it.
        We at the American Bar Association are doing what we can to
    help support them. We don't think there is any more powerful
    statement that America can make than actually showing the rest
    of the world that our citizens and our Congress have free and
    open access to all of our laws, our statutes, our regulations,
    our legal cases and briefs, and by, in a very nonthreatening
    way, helping them to do the same for their citizens.
        While we understand at the bar that you have a lot of
    demands for very scarce appropriation dollars, I think the Law
    Library has done a very good job in using the dollars that they
    have had. They have cut costs to the maximum. But at this
    moment in time, we hope that the committee will consider their
    request favorably for their appropriation because we think they
    need to preserve both their American law collection as well as
    to move forward on automation so that we will have the ability
    to export this technology and our unparalleled legal resources
    as a model for the rule of law throughout the world.
        I would like to ask the committee's indulgence and ask that
    Bill Orton be allowed to speak for a moment.
        Senator Bennett. Of course.

                               prepared statement

        Ms. Zargorn. We are very honored that he had agreed to join
    me on the committee and to help me with my work in behalf of
    the Law Library. He will become a formal member of the
    committee in August.
        [The statement follows:]

                     Prepared Statement of Janet S. Zagorin

        Mr. Chairman and Members of the Subcommittee, the American
    Bar Association (ABA) appreciates the opportunity to present
    testimony on the fiscal year 1998 Legislative Appropriations
    budget. My name is Janet S. Zagorin. I am Chair of the American
    Bar Association (ABA) Standing Committee on the Law Library of
    Congress. This testimony is being submitted on behalf of the
    ABA at the request of N. Lee Cooper, President of the
    Association.
        In my non-volunteer life, I am a law librarian. I am
    currently the Director of Practice Development of the New York-
    based law firm of Stroock & Stroock & Lavan LLP. I appreciate
    the opportunity to testify on behalf of the ABA in support of
    the budget request of the Library of Congress and its Law
    Library.
        With over 348,000 members, the ABA is the world's largest
    professional organization. Due in large part to a sophisticated
    volunteer network, the ABA has been able to play a crucial role
    in ensuring that our government is committed to leadership in
    the development and maintenance of a first-rate library. It is
    our hope that the Library of Congress and its Law Library
    continue to receive adequate funding.
        The ABA has given special focus to the Law Library of
    Congress through its Standing Committee on the Law Library of
    Congress, which was created in 1932 because the Association was
    committed to its growth as the nation's principal repository of
    legal literature and sources. And we have watched in awe as
    that collection has become one of the most prestigious and
    comprehensive legal collections in the world. It is an archive
    of the best that the world's legal minds have produced, and
    also a living resource that reflects our vision of democracy
    and promotion of the rule of law throughout the world. As
    Americans consider the globalization of our economy, the spread
    of democracy, and the advancement of fundamental freedoms and
    human rights, Congress' commitment to the Law Library of
    Congress becomes more imperative.
        The Library of Congress has requested $387.6 million for
    fiscal year 1998 (which includes $30.4 million in authority to
    use receipts), a net increase of $25.7 million or 7.1 percent
    over its current budget. More than half of this request, or
    $14.7 million, is needed for mandatory pay and unavoidable
    price increases for goods and services. Since 1993, the Library
    has been forced to absorb many such increases and now, as it
    prepares for 1998 and beyond, there is no flexibility left to
    absorb these costs. These kinds of cuts adversely affect every
    department of the Library, including its Law Library. While we
    appreciate Congress' continued interest and support for the
    Library of Congress during these austere fiscal times, we urge
    you to prevent further erosion of its workforce and resources.
        Of the remaining $12.3 million in the requested increase,
    $6.1 million is targeted for automation projects that will
    improve the Library's efficiency and effectiveness both in
    internal operations and in public access to the collections.
    One such project is the Global Legal Information Network
    (GLIN), developed and directed by the Law Library.
        GLIN is an innovative effort involving government partners
    throughout the world who share via the Internet the full text
    of their nation's laws and regulations. It performs the dual
    function of expediting the Law Library's research services to
    Congress as well as promoting international communication,
    exchange, and comprehension of legal information.
        As the Library of Congress continues to meet new
    technological demands, its challenge to remain a leader in
    serving the Congress and the nation, without adequate
    resources, becomes more difficult. While economic realities are
    forcing our major public institutions to be more competitive,
    current technology is simultaneously providing opportunities to
    be cost-effective. GLIN, as part of the entire digital effort
    of the Library of Congress, reflects the Law Library's efforts
    toward that end. Moreover GLIN, a true multinational database,
    enables the Law Library of Congress to enhance its leadership
    role in providing expertise on matters of interest to Congress
    and the nation.
        Although the Congress is the priority client of the Library
    of Congress and its Law Library, I know that you will agree
    that this important institution renders a great deal of
    valuable service to the nation. That service should be
    supported by the Congress because it enhances the lives of all
    of us. Given the challenges of today's world and the great
    resources of the Library, it should be made more--not less--
    accessible.
        I know that you are facing many difficult choices as you
    search for savings in the Legislative Branch budget, but I hope
    that you will spare our nation's Library in that search. As it
    has in recent years, the Library has requested only the vital
    essentials and a modest increase to continue to meet the
    demands of its strategic plan and a rapidly changing world. Its
    Law Library, likewise, must be able to continue to maintain its
    role as a global legal information center.
        Faced with the necessity of developing a leading presence
    in the electronic age while maintaining its preeminent legal
    collection, the Library of Congress must have adequate funding
    to continue to serve our nation's law makers, the legal
    community, and the public. We believe that proper funding is
    vitally important to ensure the integrity of the Law Library's
    collections and the services dependent upon them.
        Finally, as we celebrate the valiant restoration and
    reopening of the Thomas Jefferson Building, we are reminded
    that the Library of Congress is a tremendous source of pride
    for the nation and a true symbol of its founding ideals. At a
    time when nations all over the world are questioning their
    leaders, their systems of justice, and their very foundations,
    it is imperative that we support the primary institution that
    preserves the knowledge and ideas that sustain us as a
    community and a nation.
        Mr. Chairman and Members of the Subcommittee, the American
    Bar Association appreciates your courtesy in allowing me to
    appear before you today. We hope that you will look most
    favorably upon the budget request of the Library of Congress
    and its Law Library.

        Senator Bennett. You are always welcome, Bill.
        Mr. Orton. Thank you. I have a request of the committee
    before giving testimony.
        As you know, having been away from the Congress for less
    than 1 year, I am under restrictions for postemployment
    activities in contact with Congress. I don't believe that my
    support of an appropriation for the Library of Congress
    violates that, but I have received an opinion from the House
    Ethics Committee that there is an exception for sworn testimony
    before committees of Congress. So I would request, if you
    could, to swear me in so that I could meet that exception and
    there would be no question about my appearance here.
        Senator Bennett. We will be happy to do that. I am
    interested because sometimes we have suggested to witnesses
    that they be sworn, and they take exception to that. They
    resent that.
        You will just have to trust my memory.
        Raise your right arm. Do you swear that the testimony you
    shall give before this committee shall be the truth, so help
    you God?
        Mr. Orton. I swear.
        Senator Bennett. Thank you. You are now appropriately
    protected.
        Mr. Orton. Thank you. [Laughter.]
        It is a pleasure and I will be very brief. I did not submit
    prepared testimony.
        I support the testimony of the American Bar Association's
    standing committee. I just want to make the point that, as a
    former Member of Congress, while I was in Congress, recognizing
    that the principal purpose of the Library of Congress is to
    support Congress and provide for the needs of Congress, I had
    an opportunity on many occasions to use the Library's services.
    I know that they are not only the preeminent law library but
    the employees there are striving to do the very best job for
    the least dollar that they possibly can do. And having served
    on the Budget Committee in the House, and I know you have
    served in the Senate, it is my impression that we have cut more
    than the fat out of the Library of Congress.
        They have had to assume expenses, the normal increasing
    expenses as a result of inflation, and so on, out of other
    portions of their budget, and there is just no more room left
    to take any more.
        They are requesting an increase and, as they move to
    digital operation so that they can go online with all of the
    various services which will have tremendous cost savings to the
    Congress as well as the public, it does cost money to do that.
    And particularly, since I am here in specific support of the
    Law Library of Congress, as they are developing the global
    legal information network, GLIN, as part of their digital
    process, it is costly to do this. But it is extremely
    beneficial.
        I served on the Foreign Affairs Committee and also
    independently with the Center for Strategic International
    Studies, CSIS, as a member of the St. Petersburg Commission,
    and on that commission I know that in Russia, as I have met in
    meetings with them, we have, as the commission--I know that the
    Nation of Russia has relied upon the information from the
    Library of Congress and the Law Library of Congress as they are
    trying to develop their statutes so that they will be able to
    fully interface their open market society with the Western
    countries, including the United States.
        So it is an area where we can't afford to be foolish in our
    cuts, simply to cut money and balance the budget. There has
    been no stronger supporter of a balanced budget in Congress
    than myself. But I also believe I am one of the strongest
    supporters of the Library of Congress and I am here to support
    their full request for the increase that they have put in as a
    line item increase.
        I would encourage you, if at all possible, to include that
    in your appropriation.
        Senator Bennett. Thank you very much.
        As I said in my opening comments at the beginning of the
    hearing and certainly including the Library of Congress, as a
    member of this subcommittee, working with Chairman Mack when
    there was a change in control, we did work hard to reduce
    legislative branch appropriations in the 104th Congress, and we
    feel pretty good about what we accomplished.
        Having accomplished that, I am not sympathetic to the
    demand that is coming out of the House that we now freeze at
    those levels. I think a freeze implies that we did not exercise
    our stewardship in the 104th Congress. I think we did, and
    appropriate increases relating to mandatory pay increases and
    appropriate inflation now make sense from the base level that
    we laid down.
        So I am sympathetic to what you are saying here and wanted
    you to know, in case you had not picked up that earlier comment
    on my part, that this subcommittee, speaking not only for
    myself but for the other members of the subcommittee with whom
    I have had obvious conversations, is not disposed to go along
    with the House call for a freeze.

                              subcommittee recess

        Your testimony is very helpful. We will pay close heed to
    it.
        Mr. Orton. Thank you.
        Ms. Zargorn. Thank you very much for your time.
        Senator Bennett. Thank you for coming in.
        The subcommittee is recessed.
        [Whereupon, at 11:38 a.m., Thursday, June 5, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

             LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 1998

                                  ----------

                             TUESDAY, JUNE 10, 1997

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10:04 a.m., in room S-128, the
    Capitol, Hon. Robert F. Bennett (chairman) presiding.
        Present: Senators Bennett and Dorgan.

                              OFFICE OF COMPLIANCE

    STATEMENTS OF:
            GLEN NAGER, CHAIRMAN OF THE BOARD
            RICKY SILBERMAN, EXECUTIVE DIRECTOR
    ACCOMPANIED BY:
            DENNIS DUFFY, GENERAL COUNSEL
            JAMES STEPHENS, DEPUTY EXECUTIVE DIRECTOR FOR THE HOUSE
            PAM TALKIN, DEPUTY EXECUTIVE DIRECTOR FOR THE SENATE
            BETH HUGHES-BROWN, BUDGET OFFICER

                  OPENING STATEMENT OF HON. ROBERT F. BENNETT

        Senator Bennett. The subcommittee will come to order.
        This morning we are scheduled to hear testimony from the
    Office of Compliance, the Secretary of the Senate, the Sergeant
    at Arms, and the Architect of the Capitol in their budget
    requests for 1998. We will start with the Office of Compliance.
    We have as witnesses, Mr. Glen Nager, Chairman of the Board,
    and Ms. Ricky Silberman, Executive Director.
        I want to commend the Office of Compliance for carefully
    reviewing their budget and keeping their budget request not
    only within bounds of inflation, but they actually have a 0.3-
    percent reduction from their fiscal year 1997 level.
        That is the good news in statistical terms. The bad news in
    overall terms is it is only $9,000. Folks who would love to
    spend that elsewhere will find that that is relatively small,
    but nonetheless you start out with a small budget and any kind
    of reduction is much appreciated.
        Mr. Nager, we will go with you.

                statement of Chairman of the Board of Directors

        Mr. Nager. Thank you very much, Mr. Chairman. It is
    obviously an honor for me to be here. Today marks the first
    time that the Office has appeared before this committee and it
    is the first time I have had an opportunity to appear before
    you.
        As a private citizen for most of my life, and as a public
    servant for a small portion of it now in this part-time
    position, it is a special honor to be here before you today.
        The Office of Compliance was established by the
    Congressional Accountability Act as an independent office
    within the legislative branch. It has a Board of Directors of
    private citizens who are experienced in the labor and
    employment laws made applicable to Congress by the
    Congressional Accountability Act.
        As Chair of the Board, my first responsibility was to
    appoint the four officers who would serve on a full-time basis
    and provide the full-time management for the Office. We have
    assembled that team and I think it is a remarkable team that
    has done remarkable work in the first 2 years, including work
    with respect to the budget to try to keep this as lean an
    agency as we can and still perform the required statutory
    functions.
        If the chairman would allow me the honor, I would like to
    introduce these officers to you.
        Senator Bennett. We would be delighted.
        Mr. Nager. The Executive Director is Mrs. Ricky Silberman.
    Sitting behind me starting with my right is Mr. Dennis Duffy
    who is the General Counsel of the Office, Beth Hughes-Brown who
    is our Budget Officer, and then behind me is Mr. Jim Stephens
    who is the Deputy Executive Director for the House of
    Representatives, and Pam Talkin who is the Deputy Executive
    Director for the Senate.
        During our first 2 years as a Board, we have devoted the
    bulk of our time to putting out the regulations required for
    each of the laws that the Congressional Accountability Act
    applied to the legislative branch. The Office has implemented
    mediation and counseling programs designed to facilitate
    compliance with those regulations and the underlying laws. As
    of December 31, 1996, all of the regulations that the
    Congressional Accountability Act asked the Board to promulgate,
    have been promulgated and either have been approved by the
    Congress, or are awaiting approval by the Congress.
        With that initial phase completed, the Board now is turning
    to its other principal task which is the adjudication of cases
    that have been filed and have not, unfortunately, been resolved
    in the mediation and counseling processes that precede Board
    consideration.
        The bulk of the Office's activities, though, are in the
    mediation, counseling, and case processing areas, and these
    operations are under the direction and responsibility of the
    Executive Director--including identifying the funding needs of
    the Office. So, if I might, I would like to turn to Ms.
    Silberman to discuss the operations of the Office and our
    budget request.
        Thank you for the opportunity to appear before you.
        Senator Bennett. Thank you, sir.

                      testimony of the Executive Director

        Ms. Silberman.
        Ms. Silberman. Mr. Chairman, it is a pleasure for me to be
    here and to thank you and the committee and its staff,
    particularly Christine Ciccone, for your guidance and support.
    Getting this fledgling agency started has been no small task,
    but we are now 2 years into it. The chairman described us as
    lean. I hope we are not lean and mean, but we try to be lean
    and tough and fair.
        The Congressional Accountability Act of 1995 applied for
    the first time 11 employment and labor laws to the legislative
    branch and created the Office of Compliance, an independent
    agency with a unique structure and responsibilities, to
    implement, administer, and enforce the CAA. Today I would like
    to very briefly summarize how the work of the Office and the
    Board has been organized in order to fulfill the important
    promises of this landmark legislation, and why we come before
    you today with the budget request that we do.
        Under the CAA, the Board, composed of five experienced
    labor and employment lawyers appointed by the bipartisan
    leadership of both Houses who serve on a part-time basis, has
    responsibility for promulgating regulations, conducting
    statutorily mandated studies and reports, and considering
    adjudicative appeals arising from complaints filed under the
    CAA, as well as other specifically designated decisions.
        Operational responsibilities are assigned to the four
    statutory appointees whom Chairman Nager introduced. We are
    appointed by the Chair with the Board's approval. As the
    Executive Director, I am the statutory chief operating officer
    of the Office, and the Deputy Directors for the Senate and the
    House have their own statutory roles. With the General Counsel,
    together we are responsible for, among other things, the
    alternative dispute resolution and adjudicative systems, the
    education and information function, which is enormously
    important, the liaison function with the Senate and House, and
    for developing recommendations to the Board for substantive
    regulations.
        Additionally, the CAA assigns responsibility to the
    Executive Director for promulgating procedural regulations, and
    to the General Counsel for the inspection and prosecutorial
    functions arising under OSHA and ADA and the investigation and
    prosecution of unfair labor practices under the labor-
    management relations section of the CAA.
        Thus, the Congress has assigned certain responsibilities to
    the Board, certain responsibilities to the Executive Director,
    and certain responsibilities to the General Counsel. One of the
    great challenges that we have had in organizing and staffing
    the Office has been to keep those functions and
    responsibilities separate which, by statute and principles of
    constitutional and administrative law, must be separate, while
    at the same time maintaining the flexibility to get the job
    done with as few full-time staff as possible.
        Although the Office is operating with far fewer people than
    we originally thought necessary to fulfill the mandates of the
    CAA, we have with this small, lean, full-time staff promulgated
    hundreds of pages of regulations, researched and written
    reports and studies, developed and disseminated voluminous
    educational materials, and I am proud to say have met every
    statutory obligation imposed by the CAA in a timely manner. I
    think that is because we recruited and hired staff who not only
    have the requisite qualifications but also the talent and
    versatility to perform the various functions mandated under the
    CAA.
        I should add here that the decision to out-source mediators
    and hearing officers was based on principles of both separation
    and cost effectiveness, as well as the necessity of having
    their great experience and wide-ranging expertise available to
    us on an as-needed basis.

               Alternative dispute resolution and case processing

        I want to take just a couple of minutes to describe the
    Office's core function which is what we are spending a lot of
    the money that you are giving us on, and that is the
    alternative dispute resolution and case processing system which
    is predicated on the notion that an informed, regulated
    community, and early resolution of disputes is best for
    everyone, that is, both employees and employers.
        Thus, the system is designed to be front-loaded with
    information and counseling so that disputes can be resolved as
    early as possible. To that end, the Office provides information
    on the rights and responsibilities under the CAA with
    briefings, printed materials, brochures, posters, factsheets,
    manuals, a web site which has been used as a model for other
    agencies, a 24-hour automated telephone information response
    system and trained counselors who answer questions and give
    advice informally. The formal process begins with counseling,
    followed by mediation, both of which are prerequisites to
    filing a complaint under the CAA either in Federal court or in
    the Office of Compliance.
        Strict confidentiality is maintained during both counseling
    and mediation, and that is mandated under the statute. The
    Congress made very clear that that is something that they felt
    was very important, and that is something that we have sought
    to maintain, and have, in fact, maintained.
        Our adjudicatory process consists of a hearing in which an
    independent hearing officer ascertains the facts, applies the
    law, and renders a written decision which can then be appealed
    to the Board. The requirements of confidentiality of
    independent experienced mediators and adjudicators as well as
    the availability of the same remedies as provided in Federal
    court ensure the essential perception and reality of the
    credibility, neutrality, and fairness of our processes.
        Our written testimony describes these functions and
    accomplishments in detail, and I thought you might be
    interested in a very brief snapshot of how well the alternative
    dispute resolution and adjudication systems, the core functions
    of the Office, are working. They went into effect on January
    23, 1996.
        Between January 23, 1996, when the act went into effect and
    May 31, 1997, the Office has received over 2,400 calls and
    visits from employees and employing offices requesting
    information. The vast majority of the employees making
    inquiries did not find it necessary to go further in the
    process. In fact, as of May 31, only 184 formal requests for
    processing, which is the way the actual complaint is started,
    were filed and many of these were resolved satisfactorily very
    early in the process. Following the counseling period, there
    have been 138 requests for mediation and 85 cases have been
    closed or settled during the counseling and mediation period.
    We still have 59 cases in which that period is ongoing, so we
    cannot draw conclusions about these cases yet.
        The bottom line is that in the 17 months since the act went
    into effect, 15 complaints have been filed with the Office,
    five hearings have been held, and the decisions of the hearing
    officers in those cases are now being appealed to our Board. I
    think it is significant that of the 184 formal requests for
    counseling, only two legislative branch employees have filed
    cases in Federal district court.
        In the 18 short months since this Office came into
    existence, much has been accomplished. We have endeavored to
    fulfill our statutory mandate faithfully, effectively, and in a
    cost-efficient manner. Although we come before you today better
    able to assess our experience and project from that experience
    our future needs, of course, there remains the uncertainty that
    is a concomitant of sailing in unchartered waters--which is
    what we have been doing from the beginning. But at this point I
    think it is fair to say that the processes are working
    extremely well. This speaks not only to the good work of the
    Office but more importantly to the commitment of Congress to
    the important principles of the Congressional Accountability
    Act.

                               prepared statement

        The Chairman and I are here to answer your questions, and I
    thank you very much for the opportunity to be here today.
        [The statement follows:]
                     Prepared Statement of Ricky Silberman
        Mr. Chairman and Members of the Subcommittee, I am pleased to
    present the budget request of the Office of Compliance (Office) for
    fiscal year 1998. The Office of Compliance, an independent office
    within the legislative branch of the Federal Government, is authorized
    by the Congressional Accountability Act of 1995 (CAA) to apply the
    rights and protections of eleven labor and employment laws to covered
    employees of the legislative branch. The Office is charged with
    implementing and enforcing the provisions of the CAA, providing
    education and information regarding the provisions, and administering a
    neutral dispute resolution and adjudication process for claims arising
    under the Act.
        To carry out these functions, the Office is requesting $2,600,000
    for fiscal year 1998, a decrease of $9,000 from the Office's fiscal
    year 1997 appropriation, with no increase in staff, based on an
    analysis of the agency's actual expenditures during its first year of
    operations. The request includes: funding for 19 full-time equivalent
    positions (FTE's); funding for a 3 percent cost of living increase for
    salaries; a reduction of 20 percent in personnel benefits; and a 23
    percent reduction in other services, primarily for hearing officers,
    mediators, and court reporting services.
        This request is based on two assumptions: that the Office of
    Compliance will remain co-located with the Library of Congress, and
    that the Office's caseload will remain at roughly its current level.
    Additional funding and staffing will be requested should either of
    these assumptions prove erroneous.
        Additionally, sections 210 and 215 of the CAA, which mandate
    investigations and allow for hearings with regard to both the public
    services and accommodations provisions of the Americans with
    Disabilities Act and the Occupational Safety and Health Act, went into
    effect on January 1, 1997. Although the Office is requesting the same
    number of FTE positions as in fiscal year 1997, we cannot predict how
    the major new ADA and OSHA functions will affect staffing requirements.
    Finally, pursuant to section 230 of the CAA, we submitted a study to
    Congress on December 30, 1996, on the application of the employment and
    labor laws incorporated in the CAA to the General Accounting Office,
    the Government Printing Office, and the Library of Congress. Should
    Congress decide that GPO, GAO and/or the Library of Congress should be
    covered under all of the provisions of the CAA, additional funding and
    staffing will be requested for the Office of Compliance.
             office of compliance's authority and responsibilities
        The Congressional Accountability Act of 1995 (CAA) established an
    independent Office of Compliance (``Office'') in the federal
    legislative branch. In addition to the five-member Board of Directors
    who serve on a part-time basis, the CAA establishes four statutory
    officers: the Executive Director, the Deputy Executive Directors for
    the House and Senate, and the General Counsel.
        Under the CAA, the Office is charged with establishing and
    administering alternative dispute resolution procedures, including
    adjudicative hearings and appeals for covered legislative branch
    employees. The CAA requires the Office's Executive Director, subject to
    Board approval, to adopt rules governing the procedures of the Office,
    and requires the Board to adopt substantive regulations for
    implementation of the CAA.
        The Office is also charged with providing education and information
    to Members of Congress, other employing offices, and employees of the
    legislative branch. Additionally, the Office of the General Counsel is
    charged with enforcement of the sections of the CAA dealing with unfair
    labor practices, safety and health, and disability access. This
    includes investigation and prosecution of claims under these sections,
    and periodic inspections to ensure compliance with health and safety,
    as well as disability access requirements.
        In general, the CAA applies the rights and protections of eleven
    labor and employment statutes to covered employees within the
    legislative branch: the Fair Labor Standards Act of 1938, Title VII of
    the Civil Rights Act of 1964, the Americans with Disabilities Act of
    1990, the Age Discrimination in Employment Act of 1967, the Family and
    Medical Leave Act of 1993, the Occupational Safety and Health Act of
    1970, chapter 71 of title 5 of the U.S. Code (relating to Federal
    service labor-management relations), the Employee Polygraph Protection
    Act of 1988, the Worker Adjustment and Retraining Notification Act, the
    Rehabilitation Act of 1973, and chapter 43 of title 38 of the U.S. Code
    (relating to veterans' employment and reemployment).
        On January 23, 1996, key provisions of the law took effect,
    covering the House of Representatives, the Senate, the Capitol Guide
    Service, the Capitol Police, the Congressional Budget Office, the
    Office of the Architect of the Capitol, the Office of the Attending
    Physician, the Office of Compliance, and their employees. On October 1,
    1996, section 220, the labor management section of the CAA took effect,
    as did the OSHA and ADA sections on January 1, 1997.
        Before discussing our request in detail, the following describes
    the primary functions and processes of the Office, highlighting our
    major accomplishments of fiscal year 1996 and noting the changes we
    anticipate in the upcoming fiscal years.
                           dispute resolution process
    Information, Counseling, and Mediation
        The Office provides covered employees in the legislative branch
    with a neutral, confidential, and efficient process for resolving
    disputes relating to employment rights and protections. Employees and
    employing offices may, at any time, seek informal advice and
    information on the procedures of the Office and the rights,
    protections, and responsibilities afforded under the CAA. The Office
    responds to all inquiries on a confidential basis, and tracks both the
    number and the nature of the inquiries.
        Under the CAA, employees must request counseling and mediation
    under the auspices of the Office of Compliance before filing a formal
    complaint. If the employee's concerns are not resolved during the 30-
    day counseling period and the employee requests mediation in a timely
    manner, the Office provides neutral, trained mediators to assist the
    parties in resolving the dispute. The period for mediation is generally
    30 days, but may be extended at the request of the parties. Pursuant to
    section 416 of the CAA, all counseling and mediation is confidential.
    Adjudication
        After counseling and mediation, if the dispute remains unresolved,
    the employee may choose either to pursue the claim through the
    adjudicative hearing process under the auspices of the Office, or file
    suit in Federal District Court. An employee who elects the adjudicative
    procedures of the Office must file a formal complaint with the Office.
    The Executive Director appoints an independent Hearing Officer to
    consider the case and render a written decision, which may be appealed
    to the Office's Board of Directors. The Board of Directors issues
    written decisions, which may then be appealed to the U.S. Court of
    Appeals for the Federal Circuit. The administrative hearing process
    offers speedier resolution and confidentiality, while offering the same
    remedies as civil action.
        Since January 23, 1996, when the CAA's dispute resolution process
    went into effect, a total of 2,420 requests for information were made
    to the Office directly, or to the Office's information line. In fiscal
    year 1996, a total of 61 formal counseling requests were filed. Of
    these, 23 were resolved during, or were not pursued past, this early
    stage of the alternative dispute resolution (ADR) process. Twenty-five
    requests for mediation were received in fiscal year 1996. Two hearings
    were held, involving nine complainants.
        In the first eight months of fiscal year 1997, a total of 123
    formal counseling requests were filed. A total of 113 requests for
    mediation have been received thus far in fiscal year 1997, some
    resulting from cases initiated in fiscal year 1996. Sixty-two cases
    were either resolved during, or not pursued past, the counseling and
    mediation stages of the ADR process. Three hearings have been held, and
    two more are scheduled.
        Although we are still working with limited statistics, the data
    demonstrate the effectiveness of the ADR process provided under the
    CAA. Because sufficient information is provided on an informal basis,
    the vast majority of potential claims never reach the counseling stage.
    Other claims are resolved in counseling, and thus do not require
    mediation. Mediation has been most effective in resolving many cases
    either through settlement, or by providing the employees with
    information that satisfies them that further proceedings are not
    warranted. Complaints have been filed in only a very few of our cases,
    necessitating hearings after the mediation stage. The ADR system is
    working as Congress envisioned.
        The Office has developed a computerized case-tracking system in
    order to meet statutory time frames, efficiently manage and report to
    Congress as mandated.
              inspections, technical assistance and investigations
    Occupational Safety and Health
        Pursuant to section 215 of the CAA, the Office of the General
    Counsel (OGC) conducts regular periodic inspections--at least once each
    Congress--of all facilities in which employees covered by the CAA work.
    On the basis of these inspections, the OGC reports on compliance with
    the provisions of section 5 of the Occupational Safety and Health Act
    of 1970, as applied by section 215 of the CAA. The OGC also assists the
    Office of the Architect of the Capitol and other covered entities, by
    arranging for inspections and other technical assistance at their
    request.
        In fiscal year 1996, the OGC completed the initial inspection of
    all facilities of the House of Representatives, the Senate, the Capitol
    Guide Service, the Capitol Police, the Congressional Budget Office, the
    Office of the Architect of the Capitol, the Office of the Attending
    Physician, the Office of Compliance, the Library of Congress, and the
    General Accounting Office, between January and June of 1996. The report
    submitted to the 104th Congress detailed findings on almost 20 million
    square feet inspected. I am pleased to transmit with this testimony a
    copy of this report (which was printed and bound by the Government
    Printing Office, as were the other attached reports).
        Effective January 1, 1997, under section 215 of the CAA, the
    General Counsel is responsible for receiving and processing requests
    for inspections, and for inspecting and investigating facilities and
    issuing citations regarding violations of occupational safety and
    health standards.
    Public Accommodations under the Americans with Disabilities Act
        Pursuant to section 210 of the CAA, the Office of the General
    Counsel conducts regular periodic inspections--at least once each
    Congress--of all facilities in which employees covered by the CAA work.
    On the basis of these inspections, the OGC reports on compliance with
    the rights and protections against discrimination in the provision of
    public services and accommodations established by the Americans with
    Disabilities Act, as applied to covered facilities by section 210 of
    the CAA. The OGC also assists the Office of the Architect of the
    Capitol and other covered entities by arranging for inspections and
    other technical assistance at their request.
        Between January and June, 1996, the OGC completed the initial
    inspection of the House of Representatives, the Senate, the Capitol
    Guide Service, the Capitol Police, the Congressional Budget Office, the
    Office of the Architect of the Capitol (including the Senate Restaurant
    and the Botanic Garden), the Office of the Attending Physician, and the
    Office of Compliance, and submitted a report on the findings to the
    104th Congress. A copy of the report is transmitted with this
    testimony.
        Effective January 1, 1997, the General Counsel is authorized by
    section 210 of the CAA to receive complaints of alleged violations of
    the public accommodation provisions of the Americans with Disabilities
    Act. He is to investigate such charges and, if warranted, issue and
    prosecute complaints against any entity responsible for correcting the
    alleged violation.
    Labor-Management Relations
        Effective October 1, 1996, the Office has carried out the Board's
    investigative authorities under section 220(c)(1) of the CAA, involving
    issues concerning the appropriateness of units for labor organization
    representation, the duty to bargain, and exceptions to arbitrators'
    awards. Since that time, three representation petitions have been
    filed, two pre-election investigatory hearings have been held, and two
    elections have been conducted.
        The General Counsel is responsible for receiving and investigating
    allegations of unfair labor practices filed under section 220 of the
    CAA, and for filing and prosecuting complaints of unfair labor
    practices with the Office.
        The Office of the General Counsel has received a total of 188
    requests for information and/or technical assistance since July 1,
    1996, under sections 210, 215, and 220. Most of these have been
    regarding the OSHA and ADA provisions of the CAA. Eight requests for
    inspection have been filed under section 215 (safety and health), and
    five unfair labor practices charges have been filed under section 220.
                           education and information
        The CAA mandates an ongoing education and information effort by the
    Office. The Office provides to Congress, other employing offices of the
    legislative branch, and covered employees information on the laws
    applied by the CAA, the Office of Compliance, and its procedures for
    dispute resolution and adjudication of claims, as well as any other
    information the Office deems necessary.
        During fiscal year 1996, a 330-page reference manual was
    distributed to approximately 600 employing offices that included
    summaries of the eleven laws applied by the CAA, a question and answer
    section for each law, and a complete set of the Office's procedural and
    substantive rules, updates, and other materials. Periodic updates to
    the manual are distributed to all employing offices throughout the
    year. In addition, a poster providing information on the eleven laws
    applied by the CAA, the Office's address, and phone numbers was
    distributed to all employing offices; an informational brochure
    containing brief summaries of the eight laws applied by the CAA on
    January 23, 1996, employee rights and protections, and the procedures
    of the Office was mailed to the residences of the 26,000 employees
    covered by the CAA. Briefings were presented by the Office to employing
    office staff to provide information and guidance on the CAA; the
    sessions were videotaped for use in district offices and for loan to
    new employing offices; and introductory briefings on the CAA were
    conducted for covered employees. The first quarterly newsletter, The
    CAA News, containing updated information on the CAA was mailed in
    October to the residences of the 20,000 employees covered by the CAA.
        A world wide web site was developed and implemented for
    disseminating Office of Compliance information via the Internet. The
    web site (www.compliance.gov), is maintained on a GPO server and is
    accessible via GPO's ACCESS system; it is updated on an ongoing basis.
    An interactive telephone information line was established which directs
    callers to recorded information, or to an Office staff member who can
    discuss claims and provide resource referrals, and keeps statistics on
    how many calls are received by category. The CAA also requires the
    Office to publish statistics on the use of the Office by covered
    employees. We anticipate publishing the first such report based on
    statistics for the year ending June 30, 1997, and annually thereafter.
                               regulation writing
        The CAA requires the Executive Director, subject to Board approval,
    to adopt rules governing the procedures of the Office. The CAA further
    requires the Board to adopt, subject to Congressional approval,
    substantive regulations implementing provisions of the Fair Labor
    Standards Act, the Family and Medical Leave Act, the Employee Polygraph
    Protection Act, the Worker Adjustment and Retraining Notification Act,
    Titles II and III of the Americans with Disabilities Act, the
    Occupational Safety and Health Act, and the Federal Service Labor-
    Management Relations Statute, as applied by the CAA.
        During fiscal year 1996, the Office reviewed thousands of pages of
    executive branch regulations, solicited comments and consulted
    extensively with interested parties in developing substantive
    regulations and procedures. Comprehensive procedural rules for the
    Office were developed, published for comment, and adopted and issued on
    December 22, 1995. The substantive regulations implementing the Fair
    Labor Standards Act, the Family and Medical Leave Act, the Employee
    Polygraph Protection Act, and the Worker Adjustment and Retraining
    Notification Act, as applied by the CAA, became effective on January
    23, 1996. The regulations for the implementation of the three remaining
    laws made applicable, i.e., OSHA, Titles II and III of the ADA, and the
    Federal Service Labor-Management Relations Statute, were developed,
    published for comment, and adopted by the Board between February and
    December 1996. The procedural rules were then amended to provide for
    implementation of sections 210, 215 and 220.
                              studies and reports
        The CAA mandates several studies to be completed during fiscal year
    1996 and 1997. Under section 230 of the CAA (2 U.S.C. Sec. 1371), the
    Administrative Conference of the United States (ACUS) was required to
    undertake a study on the application of the rights, protections, and
    procedures under the eleven employment and labor laws in the CAA to the
    General Accounting Office, the Government Printing Office, and the
    Library of Congress and their employees. Pursuant to section 309 of the
    Legislative Branch Appropriations Act for Fiscal Year 1996, the Board
    was made responsible for this study, which was presented to Congress on
    December 30, 1996.
        Section 102(b)(2) of the CAA required the Board to submit a report
    to Congress on the applicability to the legislative branch of
    employment laws, beginning on December 31, 1996, and every two years
    after that. The report was submitted to Congress on December 30, 1996.
        Sections 210(f)(2) and 215(e)(2) of the CAA required the General
    Counsel of the Office to submit, at least once every Congress, a report
    to Congress and the Office of the Architect of the Capitol containing
    the results of the periodic inspections required by the CAA. These
    studies, discussed in the Inspections, Technical Assistance, and
    Investigations section above, must also outline the steps necessary to
    remedy a violation, describe the consequences of each violation, and
    estimate the cost and time needed to correct the violation. The initial
    section 210 and section 215 studies were presented to Congress on June
    28, 1996.
        Much of the research for and writing of the section 102(b) and
    section 230 studies were completed in fiscal year 1996. For the section
    230 study, the Office conducted outreach and collected data from the
    three instrumentalities, as well as other interested parties. For the
    section 102(b) study, all new and existing legislation was surveyed,
    including regulations relating to the terms and conditions of
    employment of employees and access to public services and
    accommodations. Reports on both studies may be found on the Office's
    home page (http://www.compliance.gov), and I am pleased to present a
    copy of each to you with this testimony.
        The Board has approved an interim section 102(b) study on those
    sections of the CAA laws not specifically incorporated into the CAA. We
    anticipate the publication of this interim study early in fiscal year
    1998. In addition, as noted, section 102(b) of the CAA mandates the
    examination of all new and existing legislation on a biannual basis.
    The second full 102(b) study will be conducted during fiscal year 1998,
    and the report will be issued in early fiscal year 1999.
                   administrative and financial improvements
    Accomplishments in fiscal year 1996
        Early in fiscal year 1996, the Office occupied a small suite of
    offices in the Adams building of the Library of Congress on a temporary
    basis. It was expanded with considerable assistance from the Library
    and its staff in January of this year.
        The Office developed a budget and accounting system that complies
    with Generally Accepted Accounting Principles, tracks expenditures by
    primary process or function, complies with appropriations law, and,
    voluntarily, with FAR guidelines. The new system was implemented on
    October 1, 1996. The Office also implemented the Debt Collection
    Improvement Act of 1996, which required all new vendors to be paid via
    electronic fund transfer (EFT) effective on July 26, 1996. Although
    requiring that existing vendors be paid via EFT is not mandatory until
    January 1, 1999, the Office has already achieved upwards of 85 percent
    compliance with this requirement. The Office also prepared and
    submitted its first President's and Legislative Branch budgets and
    justifications.
        With considerable help from Library of Congress financial, budget,
    and personnel staff, we planned for and effected a change in the agency
    that provides administrative support--from GSA to the LOC. The Library
    now provides disbursement and budget support, obligations and voucher
    processing, and payroll services through the National Finance Center.
    The Office has on-line access to both the Library's Federal Financial
    System and Reports Management System, for purposes of producing reports
    and analyzing budget status.
        The Office developed and installed a completely internal Local Area
    Network (LAN). The primary consideration in the design of the LAN was
    strict compliance with section 416 of the CAA, which requires
    confidentiality in most of our processes; therefore, its design allows
    for no external physical connectivity. The e-mail, word processing,
    spreadsheet, and other software used by Office staff reside on the LAN.
    The cabling for the network was provided and installed by the Library
    of Congress and the Architect of the Capitol. The majority of the
    equipment was obtained from the Office of Technology Assessment.
        In order to ensure consistency with statutory time frames,
    efficiently manage and report to Congress as mandated, the Office's
    computerized case-tracking system has been developed and also resides
    on the LAN, in test mode. The system is both flexible and highly
    secure, also in accordance with the confidentiality requirements of
    section 416 the CAA, allowing even Office staff to access data only on
    a ``need-to-know'' basis.
        The Office implemented a phone system, voice mail system, and the
    world wide web site and interactive information line discussed in
    Education and Information above. The Office has Internet access, access
    to Westlaw on-line legal information services, and access to the
    Architect of the Capitol via e-mail, and we are linked to the Library
    of Congress's Federal Financial Services on-line system, all of which
    are via stand-alone computer (not connected to the LAN). The Office
    also developed and implemented a disaster recovery system for its
    confidential data. All files are backed up regularly on magnetic tape,
    and stored off-site.
        The Office established a small internal library of legal
    publications. For other publications, the Office relies on the
    collections of the Library of Congress.
                            fiscal year 1998 request
        The Office of Compliance's fiscal year 1998 budget request of
    $2,600,000 reflects a $9,000 (-0.3 percent) decrease from the fiscal
    year 1997 appropriation of $2,609,000. The request is predicated on two
    assumptions--that the Office will remain housed within the Library of
    Congress, and that the current workload will remain fairly constant.
        Since its inception, the Office has been located in the Adams
    building of the Library of Congress. Pursuant to an agreement with the
    Library, the space was expanded to accommodate our initial operations.
    On this basis, no additional funding for moving expenses, rent,
    utilities, or system and phone wiring has been included in this
    request. If the Office is required to relocate in fiscal year 1998,
    additional funding will be sought in a supplemental request.
        Although the Office is requesting the same number of FTE positions
    as in fiscal year 1997, we should again note that the CAA has not been
    in effect long enough to accurately predict future needs. It is
    similarly difficult to predict how the added responsibility of the ADA
    and OSHA functions will affect staffing requirements. In addition, on
    December 30, we submitted a study to Congress on the application of the
    employment and labor laws incorporated in the CAA to the General
    Accounting Office, the Government Printing Office, and the Library of
    Congress. Should Congress decide that GPO, GAO and/or the LOC should be
    covered under the CAA, additional funding and staffing will be needed
    for the Office of Compliance.
        Similarly with respect to projected costs for mediators, hearing
    officers, and court reporters, this budget request was extrapolated
    from fiscal year 1996 actual data that represented only two months of
    hearings and five months of mediations. Moreover, the Office's new
    functions under sections 210 and 215 of the CAA will include
    investigations and hearings with regard to both the public services and
    accommodations provisions of the ADA, and OSHA, and the labor
    management sections of the CAA. These functions could increase the need
    for mediation and hearing-related services.
        Costs for employee benefits are expected to be approximately
    $88,000 less in fiscal year 1998 than had been projected for fiscal
    year 1997. Our fiscal year 1997 request had been based on the average
    benefits ratio experienced by other agencies which did not turn out to
    be an accurate predictor.
        We continue to hire permanent full-time staff who are capable of
    performing the range of functions for which the Office has
    responsibility. Thus, we are requesting a total of $35,000 for the
    services of temporary employees, who will be needed to fill in on a
    targeted basis.
        Based on fiscal year 1996 actual expenditures, increases in
    postage, courier services, long distance data communications, and
    office supplies are requested, as is an increase in printing and
    reproduction, necessitated by the numbers of publications required to
    fulfill our statutory mandate for education and information. We are
    also requesting a $14,000 increase in equipment over the fiscal year
    1997 request.
        The Office is requesting a total increase of $10,000 for cost-
    reimbursable services specified in our interagency agreement (IAG) with
    the Library of Congress, including copying, manual labor, and graphics
    design.
        No specific amount is requested for the Awards and Settlements
    appropriation, as the Office can predict neither the numbers nor
    amounts of awards in advance. In the first eight months of fiscal year
    1997, the Executive Director approved disbursements of a total of
    $36,429 to five complainants.
                                   conclusion
        In the less than two years since this Office came into existence
    much has been accomplished. We have endeavored to fulfill our statutory
    mandate faithfully, effectively, and in a cost efficient manner.
    Although we come before you today better able to assess our experience
    and to project from that experience our future needs, of course there
    remains the uncertainty that is a concomitant of sailing in uncharted
    waters. But at this point, it is fair to say that the processes are
    working extremely well. This speaks not only to the good work of the
    Office, but, more importantly, to the commitment of Congress to the
    important principles of the Congressional Accountability Act.

        Senator Bennett. Thank you very much.
        Senator Dorgan.
        Senator Dorgan. Mr. Chairman, my regrets for being late. I
    have been involved in some meetings on the disaster bill which
    is obviously consuming the interests of my constituents and me
    and that has delayed me. I apologize.
        Senator Bennett. More than understandable.
        Senator Dorgan. I do not have any questions at the moment,
    but I appreciate very much the testimony and the good work of
    the witnesses.
        Senator Bennett. I do not have any serious questions that
    we need to spend a lot of time on. We will submit some
    questions in writing that we would ask you to respond to.

                          space in Library of Congress

        I understand you are housed in space within the Library of
    Congress and that there are a number of items in your budget
    that go to reimburse the Library. Could you briefly summarize
    what those are and give us your view as to what the future may
    hold in terms of where your offices might be and what that
    might do to future expenses?
        Ms. Silberman. Right now we have an administrative support
    services contract with the Library of Congress. We felt that
    that was the most cost-efficient way to get such things done as
    payroll and disbursements, because we are contiguous. They have
    given us very, very good service in these things. We switched
    from GSA to the Library of Congress.
        With respect to our space, it is kind of an awkward
    question, Mr. Chairman. We are very happy in the space. We do
    not know how happy they are to have us continue to be in that
    space.
        Senator Bennett. If it is nice space, they want it back.
    [Laughter.]
        Ms. Silberman. Well, I am sure that is true. Like with
    everything else on Capitol Hill, space is the most difficult
    issue, and I have to tell you that when I came up here after 11
    years with the EEOC in the executive branch, I had absolutely
    no idea that the first 5 months of my tenure would be consumed
    by finding this homeless agency some space. I will not go into
    that story now. It is not really for public consumption.
        At any rate, suffice to say that we are happy where we are.
    We understand that there are certain questions that need to be
    explored with our landlord. We do not think we are probably the
    best people to explore those questions, but if we have to move,
    there is no doubt that that will mean added costs for us which
    we did not factor into this budget request. The balance of
    interests with respect to how those costs are best allocated is
    not something we can speak to.
        What we wanted was space that was close to the constituents
    so that if people needed information and help, they could come
    to us easily, that was relatively secure in terms of the
    confidentiality requirements--and the Library has done a
    wonderful job in helping us to make that happen--and that was
    most cost efficient. We have done that now.

                         Additional committee questions

        Senator Bennett. OK, fine. Thank you very much for coming
    in. Our best wishes to you. It sounds from your testimony that
    your primary emphasis is on prevention not adjudication. I wish
    I had the same feeling about many of your sister efforts in the
    private world where the gotcha mentality seems to reign and
    they are not so interested in preventing things from happening
    or helping people understand. I commend you for that and look
    forward to visiting with you next time.
        Ms. Silberman. Thank you so much.
        Senator Bennett. Thank you very much.
        [The following questions were not asked at the hearing, but
    were submitted to the Office for response subsequent to the
    hearing:]
                         Additional Committee Questions
        Question. The Office of Compliance determined that generally the
    rights of employees at GPO, LOC and GAO were comprehensive and
    effective. However, the Office did note that some gaps exist--what are
    these gaps?
        Answer. The study under section 230 of the CAA evaluated the rights
    and protections at the instrumentalities by making comparisons with the
    rights and protections under the CAA. Following this methodology, the
    study identified the following gaps:
        Substantive rights.--Employees at GPO are not covered under the
    Worker Adjustment and Retraining Notification Act or the Employee
    Polygraph Protection Act of 1988.
        Adequacy of administrative processes.--LOC employees have no right
    of appeal to the EEOC or to any other administrative body external to,
    and independent from, the Library when the Librarian of Congress denies
    a complaint of employment discrimination. Nor can a Library employee
    appeal to an outside agency when the Library takes action against the
    employee in violation of the Family and Medical Leave Act. GPO is not
    subject to the investigatory or enforcement authority of any outside
    agency in the occupational safety and health area. Nor can a GPO
    employee apply to an outside regulatory agency if the Public Printer
    denies the employee's complaint of discrimination on the basis of
    disability, or if the employee wishes to enforce rights under the
    Uniformed Services Employment and Reemployment Rights Act.
        Adequacy of judicial processes and relief.--Employees at GPO, like
    most federal civil service employees, do not have a private right of
    action for violations of the Family and Medical Leave Act or the
    Uniformed Services Employment and Reemployment Rights Act. Furthermore,
    while GAO and Library employees have been granted a private right of
    action under the Family and Medical Leave Act, they may not be entitled
    to a jury trial, because courts ordinarily do not provide jury trials
    in cases against the federal government without express statutory
    authority, and no statute expressly authorizes jury trials in cases
    brought under the Family and Medical Leave Act. For similar reasons,
    jury trials may be unavailable to employees of all three
    instrumentalities in cases under the Age Discrimination in Employment
    Act, the Fair Labor Standards Act, and the Equal Pay Act. Employees of
    the three instrumentalities, like most federal civil service employees,
    are also not entitled to recover compensatory damages under 42 U.S.C.
    Sec.  1981 or liquidated damages under the Age Discrimination in
    Employment Act. Finally, while GAO employees may have their
    discrimination complaints adjudicated administratively, and may then
    obtain judicial review in a court of appeals, a judicial decision has
    left some uncertainty as to whether GAO employees may pursue a
    discrimination complaint as a civil action.
        Adoption of substantive regulations.--In issuing an order to
    establish its labor-management program, GAO exercised discretion under
    the General Accounting Office Personnel Act to establish limits on
    appropriate bargaining units and on the scope of bargaining that are
    more restrictive than the provisions of the Federal Service Labor-
    Management Relations statute, 5 U.S.C. chapter 71, as made applicable
    by the CAA.
        Question. Are there instances in which GAO, GPO, or LOC are
    governed by laws enforced by executive branch agencies, and in other
    instances where the same agency has the law enforced by a legislative
    branch agency, i.e.: the Office of Compliance?
        Answer. The situation described in the question is present at GAO
    and LOC, but not at GPO. With respect to GAO and LOC, certain laws are
    enforced by executive branch agencies (i.e., executive branch agencies
    may impose regulations, hear and decide employee complaints, conduct
    investigations, and/or take enforcement actions), while other laws are
    enforced by the Office of Compliance. With respect to GPO, some laws
    are enforced by executive branch agencies, but no laws are enforced by
    the Office of Compliance with respect to GPO. Furthermore, some laws
    are to be implemented by the three instrumentalities themselves,
    without enforcement by either an executive branch agency or the Office
    of Compliance.
        The following chart lists the laws made applicable to Congress by
    the CAA, and identifies where executive branch agencies enforce these
    laws with respect to GAO, GPO, and LOC, where the Office of Compliance
    enforces the laws, and where neither an executive branch agency nor the
    Office of Compliance enforces the laws.

    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                            Executive branch or legislative branch agencies that enforce the law with respect to--
     Laws made applicable to Congress by -----------------------------------------------------------------------------------------------------------------------------------------------------------
                   the CAA                                        GAO                                                 GPO                                                 LOC
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    Employment discrimination laws......  Regulatory authority is exercised by the            EEOC, except that, under the Americans with         Regulatory authority is exercised by the Librarian
                                           Comptroller General and the GAO Personnel Appeals   Disabilities Act, regulatory authority is           of Congress.
                                           Board (PAB).                                        exercised by the Public Printer.
    Fair Labor Standards Act............  Office of Personnel Management (OPM)..............  OPM...............................................  Department of Labor. Also, OPM may hear some
                                                                                                                                                   employee claims.
    Family and Medical Leave Act........  OPM until 12/30/97. Beginning on 12/30/97, under    OPM. Also, the Merit Systems Protection Board       OPM until 12/30/97. Beginning on 12/30/97, under
                                           an amendment made by the CAA, regulatory            (MSPB) may hear some employee claims.               an amendment made by the CAA, regulatory
                                           authority will be exercised by the Comptroller                                                          authority will be exercised by the Librarian of
                                           General. The PAB may hear some employee claims.                                                         Congress.
    Occupational Safety and Health Act..  Office of Compliance, beginning on 12/30/97. (Now,  The law is to be implemented by GPO. Also, reports  Office of Compliance, beginning on 12/30/97. (Now,
                                           reports must be filed with the Labor Department.).  must be filed with the Labor Department.            reports must be filed with the Labor
                                                                                                                                                   Department.).
    Federal Service Labor-Management      Regulatory authority is exercised by the            Federal Labor Relations Authority.................  Federal Labor Relations Authority.
     Relations Statute.                    Comptroller General and the PAB.
    Worker Adjustment and Retraining      Office of Compliance, beginning on 12/30/97.......  Law does not apply................................  Office of Compliance, beginning on 12/30/97.
     Notification Act.
    Uniformed Services Employment and     Office of Compliance, beginning on 12/30/97. (Now,  The law is to be implemented by GPO. (Also, the     Office of Compliance, beginning on 12/30/97. (Now,
     Reemployment Rights Act.              OPM, Labor Department, Office of Special Counsel,   Labor Department may investigate and seek           the Labor Department may investigate and seek
                                           MSPB.).                                             compliance by informal means.).                     compliance by informal means.).
    Employee Polygraph Protection Act...  Office of Compliance, beginning on 12/30/97.......  Law does not apply................................  Office of Compliance, beginning on 12/30/97.
    Public access provisions of the       Regulatory authority is exercised by the            Regulatory authority is exercised by the Public     Regulatory authority is exercised by the Librarian
     Americans with Disabilities Act.      Comptroller General. Additional administrative      Printer. Additional administrative remedies and     of Congress. Additional administrative remedies
                                           remedies and procedures become effective on 12/30/  procedures become effective on 12/30/97 under an    and procedures become effective on 12/30/97 under
                                           97 under an amendment made by the CAA, but the      amendment made by the CAA, but the Public Printer   an amendment made by the CAA, but the Librarian
                                           Comptroller General remains responsible for         remains responsible for implementation.             of Congress remains responsible for
                                           implementation.                                                                                         implementation.
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

        Furthermore, at all three instrumentalities, certain civil service
    laws outside the scope of the CAA are enforced by executive branch
    agencies. For example, the Office of Personnel Management (OPM)
    enforces laws on position classification and grading with respect to
    GPO and LOC. OPM, the Office of Special Counsel, and the Merit Systems
    Protection Board also enforce laws on prohibited personnel practices,
    adverse actions, and RIF's with respect to GPO. OPM's regulations on
    premium pay and on flexible and compressed work schedules apply to GAO,
    and OPM's regulations on benefits and annual and sick leave apply to
    all three instrumentalities.
                                  U.S. SENATE

                     Office of the Secretary of the Senate

    STATEMENT OF HON. GARY SISCO, SECRETARY OF THE SENATE
    ACCOMPANIED BY:
            SHARON ZELASKA, ASSISTANT SECRETARY OF THE SENATE
            STUART BALDERSON, FINANCIAL CLERK OF THE SENATE
            LOUISE CAMPANALE, SPECIAL ASSISTANT, FINANCIAL MANAGEMENT
                INFORMATION SYSTEM AND LEGISLATIVE INFORMATION SYSTEM

                                opening remarks

        Senator Bennett. The next panel will be the Secretary of
    the Senate. We will have the Honorable Gary Sisco. Gary, I ask
    you to introduce whomever you have with you.
        Mr. Sisco, we want to welcome you before the committee.
    This is your first time testifying as Secretary of the Senate.
        The Office of the Secretary has been actively pursuing two
    large projects: Implementation of the financial management
    system and the legislative information system.
        Mr. Sisco. That is correct.
        Senator Bennett. We look forward to hearing about your
    progress in these areas and whatever other information you wish
    to share with us.
        Senator Dorgan, do you have any opening remarks?
        Senator Dorgan. No; I welcome Mr. Sisco and appreciate the
    service he is giving the Senate. We have great cooperation from
    his office, and since this is his first appearance, we are here
    to say welcome and we are anxious to hear your testimony.

                           introduction of Associates

        Mr. Sisco. Thank you. Mr. Chairman and Senator Dorgan, I do
    thank you for the invitation to appear before the committee
    today to present the fiscal year 1998 budget request for the
    Office of the Secretary. This is a short summary which should
    run only 10 to 12 minutes, and the longer statement has been
    submitted previously in writing.
        This is my first appearance before the committee, and it is
    an honor and a pleasure to have served as the Secretary of the
    Senate since October. I look forward to working with this
    committee and each Senator and the full Senate in the future.
        With me this morning are three people whom I want to
    introduce: Sharon Zelaska, who is the Assistant Secretary, who
    supervises the day-to-day administration of the Secretary's
    office, and by law she would perform most of my duties in the
    event of my absence. She came to the Senate in February,
    bringing two decades of experience in the Congress and in the
    executive branch of Government.
        Also here is someone familiar to you, Stuart Balderson, the
    Financial Clerk of the Senate. He has submitted to you a
    separate report concerning the overall budget of the Senate and
    the requests there. My testimony this morning will be limited
    to the Secretary's office itself.
        Also here with me this morning is Louise Campanale. Ms.
    Campanale, who comes to us from one of the major big six
    national accounting and consulting firms and who has an M.B.A.
    in accounting with a lot of experience, has joined the office
    as a special assistant to me for financial and legislative
    systems development to make sure we move these two systems
    along.
        In addition to Sharon, Stuart, and Louise, there are other
    people here, and there are more than 200 capable and dedicated
    staff who make up the departments of the Secretary's office. I
    just want to go on record that I think their contributions have
    been highly valued. They have been easy to work with and they
    are essential for us to continue to perform the constitutional
    responsibilities of the Senate.
        As Secretary, I serve as the Senate's chief legislative,
    administrative, and financial officer. My responsibilities are
    established variously in statutes, in rules, resolutions, and
    precedents of the Senate, and in direction from the Senate
    leadership and the committees, of course. But all of our
    responsibilities have a common focus and that is to enable or
    assist the Senate in fulfilling its role within our
    constitutional form of Government.
        In this statement this morning, though, my main emphasis is
    where we are now and where we are going in the future with your
    support and the support of the Senate.

                      proposed Budget for fiscal year 1998

        I have proposed a budget for the Office of the Secretary
    for fiscal year 1998 of $14,942,000, of which 89.1 percent, or
    about $13,431,000 is for salaries and $1,511,000 is for
    expenses. Compared to last year, there is a freeze on expenses
    and the salary request is a 5.64-percent increase.
        This increase includes $342,000 for cost-of-living
    allowances, $75,000 for potential overtime as we take on these
    new responsibilities, $150,000 for new positions, and $150,000
    for merit-based salary increases. There is no increase, as I
    said, for the total expenses, but there are some realignments
    based on past spending patterns and some increases that are
    narrowly focused to bring us into target with what we want to
    do today and looking forward.
        Broadly stated, the priorities that I am operating under
    and that are driving the budget are, first, to preserve the
    best and improve the rest of our current legislative,
    administrative, and financial services to the Senate.
        Second, to implement, under strategic planning--working
    very closely with the Rules Committee and the Sergeant at
    Arms--in the areas of improved financial management and
    legislative information management.
        Third, to achieve our vision--the Senate and the House
    vision--for the Capitol visitor center.
        I think the budget request being presented is sensitive to
    the demand of the leadership of the Senate, the Appropriations
    Committee, and the American public that Government become more
    efficient. But, we did not put it together with the emphasis on
    cutting for cuts' sake. We exist to serve the Senate.
        In 1995 to 1996, the Secretary's office absorbed a
    reduction across the board of 12 percent. For the current
    fiscal year, 1997, my predecessor requested what was
    essentially a freeze of the 1996 budget, and since 1995 we have
    taken on significant new responsibilities without any
    significant new funding, and we have got two major initiatives
    coming up.
        For these reasons and others, I am not looking for cuts, as
    I said, for the sake of cuts, but wherever I can, I am going to
    save dollars and make us more efficient. For example, after my
    arrival in October, at the end of 1996, we consolidated the
    Office of Printing Services with the Document Room, resulting
    in a new Printing and Document Services Division, and we had
    some significant salary and office space savings by that
    consolidation and it made sense at the time.

                               Strategic planning

        Strategic planning was initiated under the direction of the
    Committee on Rules and Administration long before I came to the
    Senate, but since I have been here, I have been active in the
    process and I am fully committed to it, as are the leaders and
    the Sergeant at Arms.
        Through strategic planning, the Senate has directed us to
    take on infrastructure and operational issues that have been
    pending before, as well as to assume some new important
    responsibilities. Where the Senate has asked that we undertake
    large scale projects, new or reallocated resources will be
    needed.
        Strategic planning has focused at the outset on four major
    operational and technological areas. Two we have mentioned--the
    financial management and legislative information systems--are
    the focus right now. Two others are human resources management
    and procurement reform.

                    Financial management information system

        On financial management, I am renaming FMS-II as FMIS. It
    is a new day. I am not superstitious, but I think it is time to
    rename it and move on.
        The objective of the financial management information
    system, or FMIS, is to develop and implement an obligation- and
    accrual-based financial management system that will provide for
    accounting and tracking and reporting and analysis of our
    financial information, which can produce an auditable
    consolidated financial statement for the entire Senate. FMIS
    will benefit all the Senate offices and the committees and
    everyone who works here by allowing all of us to control and
    track expenditures of their individual accounts.
        FMIS will replace, by October 1, 1999, several obsolete
    systems, including the Disbursing Office's general ledger
    system, which now operates on a cash basis rather than an
    accrual basis, and the Sergeant at Arms' accounting system for
    payables, which is isolated from the Disbursing Office system.
    The installation of a new general ledger system also will
    resolve--prior to it being a problem for us--the year 2000
    problem. Within the same timeframe, the Disbursing Office's
    payroll system will be made year 2000 compliant. So, that would
    not be a problem for us.
        As you are already aware, the old FMS-II experienced
    significant delays from its outset. In 1995 you appropriated $7
    million for the system, and the 1997 act extended availability
    of those funds through the year 2000. Candidly, when I took
    office last October, little progress had been made and only
    $200,000 had been spent.
        I have a handful of top priorities. FMIS is the No. 1
    priority and I plan on catching it up to implementation as we
    move forward.

                         Legislative information system

        The legislative information system, or LIS, like FMIS is a
    comprehensive Senate-wide information system that has long been
    needed. The Senate continues to rely on the information system
    that has been dated from the 1970's. Last year the Legislative
    Branch Appropriations Act mandated that we do it and that we
    implement it.
        The Legislative Branch Appropriations Act of 1997, as I
    said, directs the Secretary to develop and implement LIS under
    the oversight of the Committee on Rules and Administration. We
    are committed through the strategic planning and just through
    day-to-day management to have it online as soon as possible but
    no later than December 31, 1999. It will be a system that will
    be about preparing, storing, retrieving, and tracking and
    distributing legislative information to each Senate office and
    each committee, and each other interested person who is tied to
    the system, through their own personal computers on their own
    desks.
        An early phase of LIS became available as of last week. We
    have installed the amendment capture distribution system, the
    new equipment and software allowing the bill clerks to scan the
    floor amendments in the Chamber as they come to the desk. The
    clerks add the amendment numbers. They will add the bill
    numbers. They will add who the sponsor is, and then they will
    electronically scan that and it will enter the system. Then
    Senators and staff can view it from their own personal
    computers.
        The chairman and ranking member of the Rules Committee
    announced that about 10 days ago and we have a followup letter
    that went out yesterday on that particular phase of the
    legislative information system. Through the testing that we
    have done, we have had really good feedback from some Member
    offices. I think maybe it was in your office, Senator Dorgan.
        The legislative information system will begin with the
    floor functions, but it has significant potential for many
    other additional kinds of information that can be added once we
    get it installed. It can be designed to provide ready access
    effectively to anything that may aid a Senator in being
    knowledgeable to create informed public policy.
        As you know, no funds have been provided specifically for
    LIS to this date. I was given authority--the Secretary was--
    last year to extend surplus funds from FMS-II subject to the
    committee's approval. I have not made a request to date but
    will need to do so unless we receive the $5 million for LIS
    that is in the supplemental appropriations bill. If that
    passes, we will not be requesting any more money for LIS. If it
    does not, we will ask for transfers over from the financial
    management money that was allocated previously.
        At this point, the system cost is subject to a number of
    variables that we will flesh out during the strategic planning
    process and that we are evaluating. For example, the system
    implementation that we originally planned to be done by Senate
    staff might instead be more effectively done by an outside
    contractor. We are looking at those things.

                                 Senate library

        I will touch on the Senate library. In 1994 the
    Appropriations Committee provided full funding for the
    relocation of the Senate library in the amount of $4,900,000.
        Our intent remains the same, which is to create a state-of-
    the-art library facility in space that is more conveniently
    located to Senators' and committee offices. The Rules Committee
    has designated space in the Russell Building, which I found
    would be quite sufficient, right next to the CRS offices that
    are over there now. The Architect of the Capitol is at present
    doing asbestos removal from that space, and it is in the
    planning process. So, we will come with a new plan for that. I
    think it will be in Russell. We propose that it would be in
    Russell, as opposed to the more elaborate $4.9 million plan,
    and that will keep the volumes that are needed in the Capitol
    in the Capitol, but the others will be in the Russell Building
    in redesigned space there. I think we can do that with less
    money than has been approved.

                              Personnel management

        One other area that I want to note is personnel management.
    In terms of the internal personnel management of the
    Secretary's office in 1997, I think we have got a particularly
    important personnel challenge in the future.
        During 1996, as you know, the Secretary's office introduced
    its first job classification and compensation system through
    the Hay Group, and new market salary ranges were established
    for specific positions. In light of the requirements of the
    Congressional Accountability Act, it was absolutely necessary
    for that to have been done. But there remain questions as to
    how certain jobs in the Secretary's office which do not have
    any direct counterpart in the executive branch or in private
    industry could be compared.
        This committee in its report last year commended the
    efforts but noted that certain positions with little
    comparability to private sector occupations are essential to
    the Senate's constitutional responsibilities.
        The Hay system, we found, is useful in organizations with
    one-of-a-kind jobs, but I do not think it gave enough weight to
    the institutional knowledge of the Senate that is required in
    certain positions here. Therefore, since October I have
    exercised my discretion to modify the Hay system and to make
    adjustments for some positions, recognizing institutional
    knowledge and some other unique circumstances, and I would plan
    under good management to continue to do so in the future.
        Further, we will begin adjusting salaries for specific
    positions in the Secretary's office and awarding increases to
    specific employees on a merit basis. Though the new system is
    still under study--and I should receive it by the end of this
    month, the end of June--its essential feature will be to link
    future salary increases to merit, productivity, skill, service,
    or other factors that are measurable and that demonstrate the
    value of that employee to the Secretary's office and to the
    full Senate.

                              Succession planning

        The positions within our office that depend on
    institutional knowledge and experience present us with a major
    challenge for the future. We have people in these key
    positions, and particularly within the legislative departments,
    but not exclusively there, who are or will be eligible to
    retire in the near future. Positions with duties in the
    Chamber, as well as some others, can require 4 to 8 years of
    on-the-job training to master--at the clerk's desk in the
    Chamber, for example. We need to plan now to maintain the
    constitutionally essential functions that these departments
    perform.
        I went into that in more detail in the full statement, but
    basically there are five or six people here in key positions,
    in the Chamber or otherwise in the Senate and the Secretary's
    office, that are critical, but who are eligible for retirement
    now or who could retire in 1 year or 2. In some cases there is
    a gap because no people have been brought in underneath for on-
    the-job training to move up over time.
        So, accordingly, I am beginning a process to plan for
    succession into these essential positions in future years with
    no disruption in any critical function, looking first from
    within the Secretary's office itself and hiring from the
    inside. But this might require us, or probably will require us,
    to identify a number of prospective new hires who are highly
    qualified, possibly with experience in a related field, who are
    able to commit to a career in the Senate or for a long-term
    basis as they learn how to meet the professional standards that
    these individual positions require. Not this year, but our
    future budget for salaries will take that into account. The
    1999 budget will take that into account.

                            Capitol visitors center

        Last and quickly, the Capitol visitors center. November 17,
    1800, was the date that Congress met in the Capitol for the
    first time. So, for nearly 200 years the Capitol has stood as
    the world's greatest visible symbol of representative democracy
    for people coming here from within the country--our citizens--
    and for others from around the world.
        At the request of the leaders and the Rules Committee, I
    have at least temporarily taken the lead in preparing a Senate
    bill that would authorize construction and fundraising for a
    Capitol visitors center. We have had a series of meetings with
    the Architect of the Capitol on various issues, with the Senate
    historian and curator, with the Sergeant at Arms and with the
    House Clerk and the Sergeant at Arms of the House to consider
    educational components, and also--a big, big point, I think--
    the security component of the new Capitol visitors center and
    what that could do for us there.
        I believe that the hard construction costs can be raised
    without the use of taxpayers' funds, other than the front-end
    funding to allow the project to begin. Further, the visitor
    center will not impact my budget directly, even though key
    staff, myself, and others within the Secretary's office will
    need to make some major contributions of our time.
        We have got $24 million, or just in excess of $24 million,
    in privately raised money now in the existing Capitol
    preservation fund, and there is little doubt in my opinion, and
    the opinion of others that I talk with, that this money can be
    raised to build the Capitol visitors center from private
    sources and that the fundraising effort would be successful in
    doing that. If, however, sufficient funds for the project are
    authorized and set aside and appropriated at the outset, to be
    used as needed to draw against whatever money we have now or
    that we raise privately, then the visitor center can be begun
    without delay and built within the targeted completion date of
    November 2000. Even though that is aggressive, it will be a
    nice thing to open on the 200th anniversary of the moving of
    the Government here from Philadelphia. It would let the
    Architect go ahead and let construction contracts and proceed
    while we raise the money. While the appropriated funds can be
    drawn, they would be repaid or offset as we raise money.
        So, I am preparing that with everyone's input on the Senate
    side, and am looking to the leadership of the Senate and the
    House to pass that as soon as we can. I am personally committed
    to it and my staff and I will assist in every way that we
    possibly can.

                              prepared statements

        So, that took a little longer than I hoped for, but that
    completes my statement and I am, of course, available for
    questions.
        [The statement follows:]

                        Prepared Statement of Gary Sisco

                                 budget summary

                      OFFICE OF THE SECRETARY OF THE SENATE
    ------------------------------------------------------------------------
                                                        Amount       Percent
    ------------------------------------------------------------------------
    Fiscal year 1997 budget:
        Payroll Budget............................     $12,714,000      89.4
        Operating Expense Budget..................       1,511,000      10.6
                                                   -------------------------
          Total...................................      14,225,000     100.0
                                                   =========================
    Suggested fiscal year 1998 Budget request:
        Payroll Budget............................      13,431,000      89.9
        Operating Expense Budget..................       1,511,000      10.1
                                                   -------------------------
          Total...................................      14,942,000     100.0
    ------------------------------------------------------------------------

                                            EXPENSES--OFFICE OF THE SECRETARY
    ----------------------------------------------------------------------------------------------------------------
                                                                          Amount
                                                                         available        Budget
                                  Item                                  fiscal year      estimate       Difference
                                                                        1997 Public     fiscal year
                                                                       Law  104-107        1998
    ----------------------------------------------------------------------------------------------------------------
    Historical office:
        Books and documents.........................................          $2,500          $2,500  ..............
        Photographic supplies.......................................           7,000           7,000  ..............
    Library:
        Online information services.................................          47,000          47,000  ..............
        Microform publications......................................          31,000          35,000         +$4,000
        Books.......................................................          12,000          12,000  ..............
        Subscriptions...............................................          20,000          20,000  ..............
        Standing orders.............................................          20,000          20,000  ..............
        CD-ROM......................................................           4,000           4,000  ..............
        Audio/visual materials......................................             500             500  ..............
    Office of Conservation and Preservation.........................           3,000           5,000          +2,000
        Book preservation...........................................           5,000           5,000  ..............
        Office of Public Records (Public Law 92-342)................           8,000          10,000          +2,000
    Travel and registration fees (Public Law 94-59).................          12,000          60,000         +48,000
    Consultants (not more than two) (Public Law 95-26)..............          25,000          75,000         +50,000
    Legal reference volumes and dictionaries (Senators' offices)
     (Public Law 92-51).............................................          80,000          90,000         +10,000
    Contractual legal and administrative services and miscellaneous
     expenses.......................................................         295,000         270,000         -25,000
    Disbursing office: Payroll forms, notary fees, supplies, and
     insurance......................................................          29,000          15,000         -14,000
    Orientation and training (Public Law 95-94).....................          10,000          10,000  ..............
    Newspapers......................................................          25,000          25,000  ..............
    Senate service awards (S. Res. 21, Sept. 10, 1965)..............          23,000          23,000  ..............
    Postage.........................................................           1,000           1,000  ..............
    Education of Senate pages (Public Law 98-51 and Public Law 98-
     125) (S. Res. 184, July 29, 1983)..............................          58,000          58,000  ..............
    Stationery......................................................          50,000          50,000  ..............
    Senate Commission on Art (Public Law 100-696, Nov. 18, 1988)....          28,000          33,000          +5,000
    Representation expenses (Public Law 100-71, July 11, 1987)......          30,000          50,000         +20,000
    Office of Captioning Services (Public Law 101-163, Nov. 21,
     1989)..........................................................         235,000         163,000         -72,000
    Senate Chief Counsel for Employment.............................         450,000         420,000         -30,000
                                                                     -----------------------------------------------
          Total.....................................................       1,511,000       1,511,000  ..............
    ----------------------------------------------------------------------------------------------------------------

                            legislative departments
    Bill Clerk
        The Bill Clerk records official actions of the Senate, keeps an
    authoritative historical record of Senate business, enters daily
    legislative activities and votes into the automated legislative status
    system, and assigns numbers to all bills and resolutions.
        Legislative activity.--The legislative materials processed by the
    Bill Clerk during the last two Congresses are included in the following
    comparative chart.

                               LEGISLATIVE SUMMARY
    ------------------------------------------------------------------------
                                              104th Congress  103rd Congress
    ------------------------------------------------------------------------
    Days in Session.........................             343             291
    Hours in Session........................       2,875"/55       2,513"/15
    Measures Passed.........................             822             938
    Measures Reported.......................             509             608
    Roll Call Votes.........................             919             724
    Senate Bills............................           2,199           2,569
    Senate Joint Resolutions................              65             232
    Senate Concurrent Resolutions...........              74              80
    Senate Resolutions......................             324             294
    Quorum Calls............................               5               8
    Amendments Submitted....................           5,439           2,655
    House Bills.............................             472             498
    House Joint Resolutions.................              31              54
    House Concurrent Resolutions............              68              80
    Senate Reports..........................             398             433
    Roll Call Votes.........................             919             724
    ------------------------------------------------------------------------

        As indicated, the volume of legislative materials processed by the
    Bill Clerk during the 104th Congress was 76 percent higher than during
    the 103rd Congress, a result largely due to a substantial rise in the
    number of amendments submitted and roll call votes recorded, despite a
    general decline in the number of bills introduced over the past six
    years.
        Relations with GPO.--Although relations with GPO's Congressional
    Desk remained good, the work product was affected by the retirement of
    experienced printers, coupled with cutbacks in overall staff. The
    record on specific GPO printings for the 1996 calendar year is
    summarized below:
      --Star Prints.--The number of Star Prints authorized was down to 13,
            continuing a three-year trend in such printings.
      --``Bates List''.--Overnight rush printing was ordered on 34
            occasions.
      --``Committee Discharges'': The Secretary discontinued printing of
            ``committee discharge'' bills, saving approximately $200,000
            during the 104th Congress.
        Projects.--Two significant projects occupied the Bill Clerk in
    ``spare'' moments during the 104th Congress:
      --LEGIS 2000: The system used by the Bill Clerk for entry of status
            information is being reviewed and will be incorporated into the
            Legislative Information System (LIS).
      --Amendment Scanning: After a year of discussion, the scanning of
            proposed amendments will be a reality as of June, 1997. The
            effect this may have on our workload is unclear; current plans
            are to incorporate this additional work into the Bill Clerk's
            daily routine.
    Daily Digest
        The Daily Digest section of the Congressional Record provides a
    concise accounting of all official actions taken by the Senate on a
    particular day. All Senate hearings and business meetings (including
    joint meetings and conferences) are scheduled through the Daily Digest,
    and are published in the Congressional Record.
        Chamber Activity.--The Senate was in session a total of 132 days,
    for a total of 1,036 hours and 45 minutes. There were 2 quorum calls
    and 306 recorded votes.
        Committee Activity.--Senate committees held 522 hearings and 184
    business meetings (total 736), contrasted with 795 hearings and 227
    business meetings (total 1,022), during the 2nd Session of the 103rd
    Congress.
        All hearings and business meetings (including joint meetings and
    conferences) are scheduled through the Office of the Senate Daily
    Digest and are published in the Congressional Record and entered in the
    LEGIS hearings file. Meeting outcomes are also published by the Daily
    Digest in the Congressional Record each day.
        Government Printing Office.--Continuing a practice in preceding
    Congresses, the Daily Digest office discusses with the Government
    Printing Office problems encountered with the printing of the Daily
    Digest section. Corrections or transcript errors have become very
    infrequent.

                       HEARING/BUSINESS MEETING STATS-1996
    ------------------------------------------------------------------------
                                                         Business
                                              Hearings   meetings    Totals
    ------------------------------------------------------------------------
    January................................         14          3         17
    February...............................         43          8         51
    March..................................        122         32        154
    April..................................         59         19         78
    May....................................         89         23        112
    June...................................         76         34        110
    July...................................         67         27         94
    August.................................          7          7         14
    September..............................         60         29         89
    October................................         10          2         12
    November...............................          3  .........          3
    December...............................          2  .........          2
                                            --------------------------------
          Totals...........................        552        184        736
    ------------------------------------------------------------------------

                       HEARING/BUSINESS MEETING STATS-1994
    ------------------------------------------------------------------------
                                                         Business
                                              Hearings   meetings    Totals
    ------------------------------------------------------------------------
    January................................         18          2         20
    February...............................        100         25        125
    March..................................        161         26        187
    April..................................         99         17        116
    May....................................        133         26        159
    June...................................         86         49        135
    July...................................         67         26         93
    August.................................         50         21         71
    September..............................         52         22         74
    October................................         22         13         35
    November...............................          2  .........          2
    December...............................          5  .........          5
                                            --------------------------------
          Totals...........................        795        227      1,022
    ------------------------------------------------------------------------

    Enrolling Clerk
        The Enrolling Clerk prepares, proofreads, corrects, and prints all
    Senate passed legislation prior to its transmittal to the House of
    Representatives, the National Archives, the Secretary of State, the
    United States Claims Court, and the White House, as applicable.
        During 1996, 54 enrolled bills (transmitted to the President) and
    11 concurrent resolutions (transmitted to the Archives) were prepared,
    printed, proofread, corrected and printed on parchment.
        A total of 476 additional pieces of legislation were enacted or
    agreed to by the Senate, requiring processing and printing from this
    office.
    Executive Clerk
        The Executive Clerk prepares a record of actions taken by the
    Senate in executive session (proceedings on nominations and treaties)
    which is published as the Executive Journal at the end of each session
    of Congress. A daily Executive Calendar is prepared when nominations,
    treaties, or resolutions are pending.
        Nominations.--During the second session of the 104th Congress,
    there were 523 nomination messages sent to the Senate by the President,
    transmitting 26,211 nominations to positions requiring Senate
    confirmation. There were 11 messages withdrawing nominations previously
    sent to the Senate during the first and second sessions. Of the total
    nominations transmitted, 223 were for civilian positions other than
    lists in the Foreign Service, Coast Guard, National Oceanic and
    Atmospheric Administration and Public Health Service. In addition,
    there were 1,558 nominees in the ``civilian list'' categories named
    above. Military nominations received this session totaled 24,430 (6,213
    in the Air Force, 8,720 in the Army, 7,165 in the Navy and 2,332 in the
    Marine Corps). The Senate confirmed 33,176 nominations this session. A
    total of 748 nominations were returned to the President pursuant to the
    provisions of paragraph 6 of Senate Rule XXXI at the sine die
    adjournment of the 104th Congress.
        Treaties.--Fourteen treaties were transmitted to the Senate by the
    President during the second session of the 104th Congress for its
    advice and consent to ratification, which were ordered printed as
    treaty documents for the use of the Senate (Treaty Docs. 104-23 through
    104-36).
        The Senate gave its advice and consent to twenty-eight treaties--
    ten without reservation and eighteen with various conditions,
    declarations, understandings or provisos.
        Executive Reports and Roll Call Votes.--Twenty-five executive
    reports relating to treaties were ordered printed for the use of the
    Senate during the second session of the 104th Congress (Executive
    Repts. 104-11 through 104-36).
        The Senate conducted four roll call votes in executive session,
    three on or in relation to nominations and one on the START II treaty.
        Operations of the Executive Clerk.--This office was contacted early
    last year with concerns about the military serial numbers (i.e., Social
    Security numbers) appearing in the Congressional Record as part of the
    nomination process. Since the Record is available on the Internet there
    was apprehension about the possible fraudulent use of names and social
    security numbers. At the suggestion of this office, and with the
    agreement of all four branches of the Armed Forces, only the last four
    digits will be used, thereby eliminating any foreseeable problems in
    the future.
        In an effort to modernize the publication of the Executive Journal
    it was decided to obtain a desktop publishing system. This required the
    acquisition of new computer hardware in December, which delayed
    publication of the 1996 Executive Journal.
    Journal Clerk
        The Journal Clerk takes notes of the daily legislative proceedings
    of the Senate in the ``Minute Book'' and prepares a history of bills
    and resolutions for the printed Senate Journal that is in effect the
    index of legislative action. The Senate Journal is published each
    calendar year.
        Publication of Senate Journal.--The 1996 Senate Journal was
    completed on December 18, 1996. The Journal totaled 882 pages
    representing 132 days of Senate session. This compared with a total of
    1,244 pages for 1995, representing 211 days of Senate session. The fall
    break gave us a chance to ``catch up'' since 1994 was the first year we
    type-set the Journal ``in-house''.
    Legislative Clerk
        The Legislative Clerk sits at the Secretary's desk in the Senate
    Chamber and reads aloud bills, amendments, the Senate Journal,
    Presidential messages, and other such materials when so directed by the
    Presiding Officer of the Senate. The Legislative Clerk calls the roll
    of members to establish the presence of a quorum and to record and
    tally all yea and nay votes. This office prepares the Senate Calendar
    of Business, published each day that the Senate is in session, and
    prepares additional publications relating to Senate class membership
    and committee and subcommittee assignments. The Legislative Clerk
    maintains the official copy of all measures pending before the Senate
    and must incorporate into that measure any amendments that may be
    agreed to. This office retains custody of official messages received
    from the House of Representatives and conference reports awaiting
    action by the Senate. In addition, this office is responsible for
    verifying the accuracy of that information entered into the LEGIS
    system by the various offices of the Secretary.
        Summary of Activity.--The second session of the 104th Congress was
    typical for a presidential election year. The Senate completed its
    legislative business as early as possible before the elections and
    adjourned on October 3, 1996. During 1996, the Senate was in session
    132 days, over 1,000 hours and conducted 306 roll call votes. There
    were 260 measures reported from committees, 476 total measures passed
    and there were 267 items remaining on the Calendar at the time of
    adjournment. In addition, there were over 2,300 amendments submitted.
    Official Reporters of Debates
        The Official Reporters of Debates prepare and edit for publication
    in the Congressional Record a substantially verbatim report of the
    proceedings of the Senate, and serve as liaison for all Senate
    personnel on matters relating to the content of the Record. The Chief
    Reporter functions as editor-in-chief of the Senate portion of the
    Record, and the Coordinator of the Congressional Record functions as
    technical production manager of the Senate portion of the Record.
        Electronic Submission.--The Reporters continued the practice of
    having all spoken words of floor proceedings transcribed by this office
    sent to GPO over the fiber optic system. Although this system has not
    decreased the workload of this office, it should result in substantial
    cost savings in the preparation of the Record by GPO, in that they no
    longer have to rekeyboard the transcript prepared by this office.
        Additionally we are encouraging Senate offices to submit electronic
    versions of Record statements as well via the Senate's cc-mail system.
    The extra steps within this office of processing and formatting to
    conform with Record style will continue, however. At this point it
    should be noted that this processing of electronic files would not be
    possible without the continued cooperation of GPO in providing this
    office with a detailee. The current GPO detailee provides immeasurable
    contribution by entirely processing the electronic transcript files for
    shipment to GPO; this frees the Chief Reporter and Coordinator of the
    Congressional Record to, among other things, request of offices a data
    version to accompany the printed statement when none is provided, and
    to deal with the resulting heavy volume.
        Morning Business.--The Morning Business section experienced a
    marked increase in items processed for the Congressional Record; the
    statistics reflect a 140 percent increase in Executive Communications
    due to the passage of Public Law 104-121 (The Contract with America
    Advancement Act of 1996) which requires that every regulation be sent
    to the Congress for review. Further, concurrent resolutions were up 100
    percent; amendments were up 74.7 percent; President's Messages were up
    67.6 percent; resolutions were up 57.3 percent; joint resolutions, up
    44.4 percent; petitions, up 40.4 percent; and bills up 39.7 percent.
        Cost Savings.--During 1996, the office adhered very strictly to
    policies preventing duplicate printing of amendments offered during
    debate. In January 1996, a 10-page maximum was established for an
    amendment to be printed in the body of the Record at the time the
    amendment is offered. (During the prior year the limit was 15 pages.)
    Amendments in excess of 10 pages are referenced at the time of offer
    and printed one time only in the Morning Business portion of the Record
    under ``Amendments Submitted.'' This policy has produced substantial
    cost savings. Vigorous enforcement of the provisions of paragraph 13 of
    the Laws and Rules for Publication of the Record, the ``two-page
    rule'', entailed many telephone calls and trips to the floor, informing
    staff and Senators of the procedure necessary to have extraneous
    materials printed in the Record that exceed the two-page limit, but has
    resulted in substantial savings.
    Parliamentarian
        The Parliamentarian advises the Chair, Senators and their staff,
    committee staff, House members and their staffs, and administration
    officials on all matters requiring an interpretation of the Standing
    Rules of the Senate, the precedents of the Senate, and provisions of
    public law affecting the proceedings of the Senate.
        The Parliamentarian's office advises the Chair, Senators and their
    staff and committee staff, as well as House members and their staffs,
    administration officials, the media and members of the general public
    on all matters requiring an interpretation of the Standing Rules or
    precedents of the Senate, unanimous consent agreements, or provisions
    of public law affecting the proceedings of the Senate. The office is
    responsible for the referral of all legislation introduced in the
    Senate, all legislation received from the House, and all communications
    received from the Executive Branch. The office works extensively with
    Senators and their staffs to advise them of the jurisdictional
    consequences of particular drafts of legislation, and evaluates the
    jurisdictional effect of proposed modifications in drafting.
        The atmosphere that surrounded the parliamentary process in 1996
    resulted in an unprecedented number of questions that the
    Parliamentarian's office was asked to resolve. These questions often
    required hours of meetings with competing groups of staff. At every
    stage of the budget cycle, this office was called upon to arbitrate
    large numbers of budget-related questions. The Byrd Rule on extraneous
    matter in reconciliation bills led to intensive analysis. Concern about
    the budget deficit promises to keep the budget process (with all of its
    parliamentary complexity) in the forefront of the legislative agenda.
    Printing and Document Services
        Printing and Document Services documents Senate printing expenses
    and functions as GPO liaison to schedule and/or distribute Senate bills
    and reports to the Chamber, Senate staff, and the public; provides page
    counts of Senate hearings to commercial reporting companies, orders and
    tracks all paper and envelopes provided the Senate, provides general
    printing services for Senate offices, and assures that Senate printing
    is in compliance with Title 44, U.S. Code, as it relates to Senate
    documents, hearings, committee prints, and other official publications.
        Background.--In February 1996, the Office Services staff were
    merged into the Office of Printing Services. In December 1996, Printing
    Services was merged with the Document Room, forming the new Office of
    Printing and Document Services. From an administrative standpoint, the
    responsibility for printing and/or distribution of most of the Senate's
    official Title 44 printing is now housed within one office. The
    coordination of all Senate documents, hearings, committee prints, and
    miscellaneous publications between the Senate and GPO is our
    responsibility, as is the distribution of Senate and House legislation.
    Additionally, virtually all Senate blank paper, letterhead, and
    envelopes are ordered through this office.
        The merger and move from the Capitol into the Hart building also
    made eminent sense from a practical standpoint. The office is closer to
    its ``customers,'' in that ninety-five per cent of the offices served
    are located in the Senate office buildings. This provides better access
    for Senate staff, and more timely deliveries to Senate offices.
        Total Publications.--During the second session of the 104th
    Congress, 504 publications (hearings, committee prints, Senate
    documents, Senate Publications) were printed. This compares with 657
    publications printed during the second session of the 103rd Congress,
    or a decrease of about 23 percent.
        Hearings Transcripts and Billing Verifications.--Billing
    Verifications are the vehicle by which reporting companies request
    payment from a committee for their transcription services.

    ----------------------------------------------------------------------------------------------------------------
                                                                                                         Increase/
                                                                           1995            1996          decrease
                                                                                                         (percent)
    ----------------------------------------------------------------------------------------------------------------
    Billing verifications...........................................           1,195             782             -35
    Transcribed pages...............................................         210,839          66,188             -32
    Average pages/committee.........................................          10,039           2,545             -25
    Transcribed pages cost..........................................        $690,336        $440,875             -36
    Average cost/committee..........................................         $32,873         $16,957             -48
    ----------------------------------------------------------------------------------------------------------------

        Paper, Letterhead, and Envelopes.--Printing and Document Services
    provides and maintains an accounting of blank paper, letterheads, and
    envelopes for all Senate offices. The total blank sheets and
    letterheads ordered in 1996 were about 72.5 million sheets, a decrease
    of almost 58 million sheets compared to 1995. Envelope use continued to
    decline. In 1996, the Senate used about 7.6 million envelopes, compared
    to about 12 million in 1995.
        Service Center.--In September 1995, at the direction of the Rules
    Committee and the Joint Committee on Printing, the Secretary's Office
    undertook responsibility for management of the GPO/JCP Service Center.
    The Service Center (now located in SH-B-07) is staffed by experienced
    GPO printing specialists who provide Senate committees and the
    Secretary's Office with complete publishing services for hearings,
    committee prints, and preparation of the Congressional Record. Services
    include keyboarding, proofreading, scanning, and composition.
        During 1996, the Service Center assisted 14 committees with the
    preparation of 116 hearings, committee prints, and Senate documents
    including the Tribute to Reverend Halverson, and the Tributes to
    Senator Dole.
        Congressional Record.--Total approximate cost to produce the Record
    was $13.1 million. Based upon the percentage of content and
    distribution quantities, the proportional Senate cost was $5.9 million,
    the House cost was $6.8 million, and all other recipients $412,400. Per
    copy cost is about $8.57 (Record costs are based upon GPO estimated
    appropriation costs, not including costs to produce the Record Index or
    microfiche copies).
        Legislation.--The office captures data regarding all printed
    versions of all measures considered in the Senate. Beginning in the
    105th Congress, it will capture House measures as well. For brevity,
    the following information is summarized by major category of
    legislation, such as Senate bills. Each category includes the
    successive versions in which all measures were printed during their
    legislative cycle (such as a Senate bill which is introduced, placed on
    the Calendar, read the second time, read the third time and passed),
    including Star Prints. Information relating to specific versions of all
    legislation is available. The following table is for the second session
    of the 104th Congress.

    ----------------------------------------------------------------------------------------------------------------
                                                                                 Number of
                                  Measure                                Count     pages    Senate cost   Total cost
    ----------------------------------------------------------------------------------------------------------------
    Senate Bills......................................................      859     22,851   $1,500,000   $2,200,000
    Senate Reports....................................................      199      8,404      600,000      825,000
    Senate Resolution.................................................      136        710       45,500       64,000
    Senate Joint Resolution...........................................       22      1,044       75,400      101,800
    Senate Concurrent Resolution......................................       41        540       42,600       47,400
    House Bills (in Senate)...........................................      328     11,440      528,200    1,050,000
    House Joint Resolution............................................       17         86        3,600        7,800
    House Concurrent Resolution.......................................       41        218       14,800       19,900
    House Conference Report...........................................       34      9,004      800,300      907,500
    Treaties/Executive Reports........................................       33      1,765      149,400      152,900
    Public Laws.......................................................      236      5,044      400,000      450,200
                                                                       ---------------------------------------------
          Totals......................................................    1,946     61,106    4,200,000    5,800,000
    ----------------------------------------------------------------------------------------------------------------

        Document Services.--The Document Services section coordinates
    requests for printed legislation and miscellaneous publications with
    other departments within the Secretary's Office, Senate committees, and
    the Government Printing Office, to ensure the most current version of
    all material is available, and that sufficient quantities are in
    storage to meet projected demand.
        The primary responsibility of this section is to provide services
    to the Senate. However, it also serves the general public, the press,
    and other government agencies. Requests for material are received at
    the walk-in counter, through the mail, by FAX, and recorded messages.
    Recorded messages and FAX messages operate twenty-four hours a day, and
    are filled the same day they are received, as are mail requests.
        Summary of Annual Statistics.--The following chart summarizes
    activities and trends in Document Services from 1987 through 1996.

    ----------------------------------------------------------------------------------------------------------------
                                                                                                        Percent over
     Calendar year/Congress/session     Calls     Percent      Mail     Walk-in     Staff      Total      previous
                                       received    change    requests   requests   requests   requests      year
    ----------------------------------------------------------------------------------------------------------------
    1988: 100/2nd...................    107,871     20,579    104,000     79,163        N/A    203,742        N/A
    1989: 101/1st...................    114,580     24,415    103,540     85,488        N/A    213,443         +5
    1990: 101/2nd...................    154,497     23,322    105,823     96,330        N/A    225,475         +6
    1991: 102/1st...................    158,714     29,301    112,700     94,503        N/A    236,504         +5
    1992: 102/2nd...................    144,478     21,634    187,790     64,543        N/A    273,967        +16
    1993: 103/1st...................    135,035     23,679    143,468     64,752        N/A    231,899        -15
    1994: 103/2nd...................    128,463     20,460    128,314     54,919      4,934    203,693        -12
    1995: 104/1st...................    134,062     22,704    112,463     45,466     10,182    180,633        -11
    1996: 104/2nd...................    110,742     15,140    136,352     35,479      8,043    186,971         +4
    ----------------------------------------------------------------------------------------------------------------

                                                      DOCUTECH DATA
    ----------------------------------------------------------------------------------------------------------------
                                                                         Original     Printed     Cost
                                                    Count   Run length    pages        pages      each    Total cost
    ----------------------------------------------------------------------------------------------------------------
    1995:
        Totals..................................   1,042      93,136     31,682     1,800,000     $0.39   $36,459
        Daily average...........................       5.5       490        167         9,583       N/A       191.89
    1996:
        Totals..................................     762      43,710     43,478     3,200,000      1.46    63,727
        Daily average...........................       4.6       342        225.4      12,784       N/A       255.86
    Agencies printing--1995:
        Totals..................................      81     237,265      9,908     2,400,000       .20    47,227
        Daily average...........................       1.5     4,313.9      180.1      42,931.1     N/A       858.68
    Agencies printing--1996:
        Totals..................................     284     302,625     84,852     5,100,000       .34   101,834
        Daily average...........................       1.8     1,800        527        31,622       N/A       632.51
    ----------------------------------------------------------------------------------------------------------------

    Captioning Services
        The Office of Captioning Services provides real-time captioning of
    televised Senate floor debates for hearing-impaired persons. The office
    also provides the unofficial transcripts available to offices on the
    Senate Intranet.
        Real-time captioning refers to the live electronic subtitling of
    the audio portion of a television program by specially trained court
    reporters utilizing computers and specialized translation software. The
    Office of Captioning Services was established in 1991 to provide access
    to Senate debates to the hearing impaired in conjunction with passage
    of the Americans with Disabilities Act. The captioning text is also
    provided to Senate offices on the intranet. The office provides other
    captioning services for the Senate and Senators upon request.
        Technology Update.--Real-time captioning software upgrades during
    1996 provided stability and reliability and additional functionality.
    Upgraded broadcast router display panels in each of our two control
    rooms improved our ability to monitor our work product, systems status
    and activity in the Chamber. Quality is advanced through continuous
    tracking of translation data and weekly peer reviews.
                             administrative offices
    Disbursing Office
        The Disbursing Office compiles Senate budget estimates for
    presentation to the Committee on Appropriations, maintains and
    disburses all Senate appropriated funds and all Senate payrolls,
    interprets and carries out all matters related to budgeting,
    appropriations, compensation, payroll deductions, retirement, life and
    health insurance, and other employee benefits authorized for members
    and staff.
        Front Counter--Administrative and Financial Services.--The Front
    Counter is the main service area of all general Senate business and
    financial activity. It is the receiving point for most incoming expense
    vouchers, payroll actions, and employee benefits related forms, and is
    the initial verification point to insure that paperwork received in the
    Disbursing Office conforms to all applicable Senate rules, regulations,
    and statutes. All new Senate employees (permanent and temporary) who
    will be working in the Capitol Hill Senate offices are administered the
    required oath of office and personnel affidavit and provided verbal and
    written detailed information regarding their pay and benefits. Numerous
    inquiries are handled daily, ranging from pay, benefits, taxes, Senate
    laws and regulations, in our commitment to provide the highest degree
    of customer service.
        The Front Counter issued approximately 1,500 cash advances for
    official Senate travel; received more than 25,000 checks from Senate
    entities; administered oath and personnel affidavits to more than 3,000
    new Senate staff; maintained brochures for 28 Federal health carriers,
    and distributed approximately 2,500 brochures to staff during the
    annual FEHB open season.
        Payroll Section.--The Payroll Section maintains the Payroll/
    Personnel System and is responsible for the following: processing,
    verifying and warehousing all payroll information submitted to the
    Disbursing Office by Senators for their personal staff, by Chairmen for
    their committee staff, and by other elected officials for their staff;
    issuing salary payments; processing overtime payments; maintaining the
    Automated Clearing House (ACH) Fedline facilities for the normal
    transmittal of payroll deposits to the Federal Reserve; distributing
    the appropriate payroll expenditure and allowance reports to the
    individual offices; issuing the proper withholding and agency
    contributions reports to the Accounting Section and transmitting the
    proper Thrift Savings Plan (TSP) information to the National Finance
    Center, while maintaining earnings records for distribution to the
    Social Security Administration, and maintaining employees' taxable
    earnings records for their W-2 statements, which are prepared by this
    section.
        In 1996, the Payroll Section designed a new Payroll Information
    Notice (PIN) and new W-2 mailer. The new PIN forms are cheaper to
    produce and mail, and are more informative, and qualify for U.S. Postal
    Service mailing discounts. The combined savings to the Senate from both
    forms are more than $20,000 annually.
        Employee Benefits Section.--The Employee Benefits section
    administers Senate employees' health and life insurance and retirement
    programs for the Senate. The section's work includes research and
    verification of prior Senate or other federal service for new
    appointees. The section prepares these forms for payroll input and
    after they are returned, verifies the accuracy of the information when
    the Official Personnel Folder is received. Employment verifications for
    loans, the Bar, the Federal Bureau of Investigation, the Department of
    Defense, and for outside insurance are completed. Unemployment claim
    forms are completed, and employees are counseled. Department of Labor
    billings for unemployment paid to Senate employees are checked and
    submitted by voucher to the Accounting Section to be paid. Designations
    of Beneficiaries for life insurance, retirement, and for unpaid
    compensation are filed and checked by the section.
        Seminars were held for outgoing and incoming Members' staffs, as
    well as Committees facing reorganization. Information disseminated
    included retirement, health and life insurance, unemployment, and
    Ramspeck privileges.
        Since 16 Members left office, the section's work in the end of 1996
    included approximately 700 new appointments; 700 termination packets,
    counseling and processing, retirement planning and processing, and
    providing records to other agencies hiring former Senate employees.
    Since most of the Members leaving were long term Members who were
    retiring, our retirement caseload set a new record (250 retirement
    cases).
        Audit Section.--The Audit Section is responsible for auditing
    vouchers, answering questions regarding voucher preparation, monitoring
    payments related to contracts, training new Office Managers and Chief
    Clerks in Senate financial practices, training Office Managers in the
    use of the Senate Office Accounting System (SOAS), and producing the
    Report of the Secretary of the Senate. The Section also maintains the
    Senate's central vendor file (MODA) and monitors the Fund Advance
    Tracking System (FATS) by ensuring that advances are charged correctly,
    vouchers repaying such advances are entered, and balances adjusted for
    reuse of the advance funds.
        The Audit Section received and audited approximately 82,200
    vouchers in 1996. This is a 7 percent decrease from 1995. These include
    vouchers from: Senators' Offices--51,200 vouchers (62 percent of all
    vouchers) of which 22,650 (28 percent of all vouchers) were for travel;
    Sergeant at Arms--14,700 (18 percent of all vouchers); Stationery &
    Gift Shop--7,500 (9 percent of all vouchers); and Others--8,800 (11
    percent of all vouchers).
        Training sessions were conducted for 28 new Office Managers/Chief
    Clerks and 25 SOAS users.
        Accounting Section.--The Accounting Section compiles the annual
    operating budget of the United States Senate for presentation to the
    Committee on Appropriations, and ensures adherence to appropriation
    limitations established by the Legislative Branch Appropriations Act,
    and Title 2 of the United States Code. The Accounting Section
    accomplishes its control of appropriation limitations through the
    maintenance of the general ledger of the Senate.
        Monthly financial reporting requirements to the Department of the
    Treasury include a Statement of Accountability that details all
    increases and decreases to the Accountability of the Secretary of the
    Senate, such as checks issued during the month and deposits received,
    as well as a detailed listing of cash on hand. Also reported to the
    Department of the Treasury on a monthly basis is the Statement of
    Transactions According to Appropriations, Fund and Receipt Accounts
    that summarizes all activity at the appropriation level of every penny
    disbursed by the Secretary of the Senate through the Financial Clerk of
    the Senate. All activity by appropriation account is reconciled with
    the Department of Treasury on a monthly and annual basis. The annual
    reconciliation of the Treasury Combined Statement is also used in the
    reporting to the Office of Management and Budget as part of the
    submission of the annual operating budget of the Senate.
        The Accounting Section also transmits all Federal tax payments on a
    monthly basis for Federal, Social Security and Medicare taxes withheld
    from payroll expenditures as well as the Senate's matching contribution
    for Social Security and Medicare to the Federal Reserve Bank. The
    Section also performs quarterly reporting to the Internal Revenue
    Service and annual reporting and reconciliation with the IRS and the
    Social Security Administration. Payments for Senate employee
    withholding for state income taxes are reported and paid on a quarterly
    basis to each state with applicable state income taxes withheld.
    Monthly reconciliations are performed with the National Finance Center
    regarding the Senate's employee withholding and agency matching
    contributions for the Thrift Savings Plan. All employee withholdings
    and agency contributions for life and health insurance, and federal
    retirement programs are transmitted to the Office of Personnel
    Management on a monthly basis. Any adjustment to employee contributions
    to any of the health, life and retirement plans from previous
    accounting periods are also processed by the Accounting Section.
        Internally, the Accounting Section prepares and transmits ledger
    statements monthly to all Member offices and all other offices showing
    payroll and non-payroll expenditures. These ledger statements detail
    all of the financial activity for the appropriate accounting period
    with regard to official expenditures in detail and summary form. On a
    semiannual basis all committee ledgers are reconciled with the
    Accounting Section records, and the results are reported to the
    Committee on Rules and Administration. Also, on a semiannual basis, the
    Accounting Section prepares necessary reports and information to be
    included in the Report of the Secretary of the Senate. On a monthly and
    semiannual basis, a complete reconciliation of the Senate payroll is
    performed.
        Currently, more than 9,000 active ledger accounts are tracked daily
    through the Disbursing Office Voucher Entry System (DOVES). All voucher
    reimbursement payments, checks written, deposit and adjustment entries
    are processed in this system. While routine maintenance and
    enhancements to the DOVES system continue, the primary focus is to
    prepare for the replacement of the Senate general ledger system. The
    Senate currently operates on a cash basis accounting system. With the
    implementation of the new general ledger system (FMS-II) there will be
    a conversion to an accrual and obligation-basis accounting system.
    Office of Human Resources
        The Office of Human Resources implements and coordinates human
    resources policies, procedures, and programs for the Office of the
    Secretary of the Senate including hiring; training; performance
    management; job analysis; compensation planning, design, and
    administration; leave administration; records management; job
    advertisements and postings; employee handbooks and manuals; employee
    relations; and organizational planning and development.
        Several key personnel programs were developed and implemented
    during 1996, with a primary goal of ensuring consistency and equity
    throughout the organization and complying with the requirements of the
    Congressional Accountability Act.
        Job Classification and Compensation System.--The Office of the
    Secretary's first job classification and compensation system was
    implemented in June 1996. This new system was a joint endeavor between
    an Office of the Secretary Steering Committee and a Project Team
    comprised of the Office's Director of Human Resources and Hay
    Management Consultants (or the Hay Group). The team used Hay's point
    factor job evaluation system to evaluate the content of each job within
    the Office. Widely recognized as the most advanced and effective way to
    determine equitable compensation, the Hay Method is used to establish
    consistent relationships, expressed in precise points, for jobs within
    and between organizations. These points were then compared with
    compensation data from Hay's National Survey of All Organizations,
    market rates were determined, and salary ranges were established. These
    salary ranges--representing the continuum along which each employee can
    expect to progress based upon merit, or quality of performance--were
    provided to each employee. Now, in addition to ensuring compensation
    equity throughout the Office of the Secretary, employees have greater
    visibility into job worth and pay and greater individual control over
    future compensation decisions and career development.
        Employee Handbook.--The Office's Employee Handbook underwent a
    major revision on October 1, 1996, to incorporate policy stemming from
    the Congressional Accountability Act and, where appropriate, to clarify
    or strengthen some earlier provisions. Major changes include (1) rules
    governing the acceptance of gifts, including foreign gift rules and
    travel; (2) mass mailing reporting requirements; (3) the public law and
    Office policy on employment of relatives; (4) Office compensation
    practices, including the overtime provisions of the Congressional
    Accountability Act, new employee pay classifications, and time and
    attendance reporting; and (5) leave policy, including a new ``leave
    year,'' carryover provisions, and a Family and Medical Leave Act (FMLA)
    Reserve account.
        Time and Attendance System.--In order to accurately report time
    worked, the Office developed a new time sheet, appointed time keepers
    for each department, and conducted training for time keepers and/or
    department heads. This system allows time to be maintained, calculated,
    and reported on the employee's personal computer and cumulative data to
    be maintained and tracked for major time-off categories and for extra
    time worked.
    Library
        The Senate Library is a legislative and general reference library
    which provides both traditional and computerized information services
    and cataloging and maintains a comprehensive collection of
    congressional, governmental and other publications for the use of
    Senate offices and the press.
        Information Services.--Information Services was established as a
    function from the merger of two previously separate functions,
    Legislative Tracking and Reference Services. This merger was in
    response to changing patterns of client demand for library services.
    Reference requests for the period 1989 through 1995 increased (75
    percent) while the number of legislative tracking requests declined (38
    percent) during the same period. The decline in legislative tracking
    requests was due to the availability of online access to the
    information in Senator's offices. This anticipated shift allowed the
    Library to focus resources on the research needs of the Senate.
        Technical Services.--Organizational changes, including reassignment
    of work flow, modification of tasks, and revisions of position titles
    and job descriptions, were undertaken to facilitate the final stage of
    a three-year process to fully implement the Library's integrated
    library system (DataTrek). Centralization of the acquisitions,
    cataloging and circulation functions on DataTrek has resulted in the
    closing of two separate in-house databases as well as the mainframe-
    based SLCC database, formerly maintained by the Senate Computer Center.
    These changes have redirected resources toward providing quicker and
    more efficient access to collection resources, thereby allowing Library
    staff to respond more effectively to Senate requests. Anticipated
    vendor-developed software will allow direct access to our catalog by
    Senate offices via the Senate Intranet.
        Acquisitions.--The reality of flat and reduced budgets for the past
    three fiscal years, coupled with the rising cost of publications,
    resulted in a reduction in the overall number of books, standing
    orders, subscriptions and microform titles purchased. In 1996, the
    number of congressional documents also declined from the previous year,
    due in part to an increased effort by committees to hold down printing
    costs, which resulted in fewer documents printed. The decline in books
    and congressional materials was offset by an increase in the number of
    executive branch publications received cost-free through the Depository
    Library Program administered by the Government Printing Office.
    Consequently, acquisitions of all types of material increased 9 percent
    over the pervious year.
        Cataloging.--The number of bibliographic records added to the
    library catalog in 1996 was 5,800 an increase of 26 percent over the
    previous year. This was the result of a concerted effort to complete
    the retrospective cataloging of executive branch publications. In
    addition, 26,000 item records were created, each containing the barcode
    and other information needed to permit the borrowing of these materials
    by Senate staff.
        Conservation and Preservation.--The Office of Conservation and
    Preservation provided valuable assistance by funding a cleaning project
    in the Library's space located in the basement of the Adams Building of
    the Library of Congress. This cleaning, which had last been done about
    ten years ago, is necessary for the long-term preservation of Senate
    materials. In addition, the OCP repaired and cleaned numerous 19th and
    early 20th-century volumes in order to permit their use by Senate
    staff.
        Public Relations.--Library personnel participated in 30 orientation
    seminars sponsored jointly by the Secretary of the Senate and the
    Sergeant at Arms. These seminars are the primary means to inform Senate
    staff of services available through the Library. The Library launched
    its homepage on the Senate Intranet in March 1996. On September 24,
    1996, the Library hosted a reception to celebrate the 125th anniversary
    year of the establishment of the Senate Library in 1871. Senators
    Thurmond, Hatfield, Byrd, Cochran, Simon and Robb were in attendance
    along with an estimated 350 patrons, colleagues and friends of the
    Library.
        Library Relocation.--In December 1995, the plan to relocate the
    Senate Library was placed on hold pending a review by the Senate
    Committee on Rules and Administration. In October 1996, the Secretary
    of the Senate requested that the Library explore options to move staff
    and portions of the collection to designated space in the basement of
    the Russell Senate Office Building. A new proposal was submitted in
    November 1996.
    Office of the Senate Chief Counsel for Employment
        The Office of Senate Chief Counsel for Employment is a non-partisan
    office established at the direction of the Leadership in 1993, after
    enactment of the Government Employees Rights Act, which established a
    hearing process for allegations of employment discrimination in the
    Senate followed by court review. With enactment of the Congressional
    Accountability Act of 1995, which brings the Senate under 11 federal
    laws regulating the employer-employee relationship in the private
    sector, the Office provides legal advice and representation to Senate
    employing offices in all areas of employment law.
        Background.--The Office of the Senate Chief Counsel For Employment
    (``SCCE'') is a non-partisan office formed in 1993 at the direction of
    the Leadership. It is charged with providing legal advice and
    representation of Senate offices in all areas of employment law.
    Collectively, the office's attorneys have more than 55 years of
    experience at major national law firms representing clients in
    employment litigation and labor law matters.
        Pursuant to the Congressional Accountability Act (CAA), each Senate
    office is a separate employer; the Senate as a body cannot be sued
    under that law. Accordingly, each of the 180 offices of the Senate is
    an individual client of the SCCE, and each office maintains an
    attorney/client relationship with the SCCE.
        Compliance with the Congressional Accountability Act.--Most
    provisions of the CAA became effective in January 1996. A primary
    responsibility of the SCCE is to advise Senate management about their
    obligations under the CAA, and the number of requests the SCCE received
    for legal consultation in 1996 was more than twice the number in 1995.
        The SCCE advised Senate offices about the CAA and assisted them in
    complying with it through four principal means: addressing the
    Senators, giving large group seminars for AA's and office managers,
    providing legal advice to offices on an individual basis, and preparing
    and distributing written information. Specifically, the SCCE did the
    following:
      --Spoke to Senators at 4 policy lunches (2 Republican and 2
            Democratic) to advise them of their legal obligations under the
            CAA;
      --Gave a 90-minute orientation speech to Senators-elect regarding
            employment and labor laws;
      --Presented 14 large group seminars (75-200 attendees) to
            Administrative Assistants, Chiefs of Staff, Office Managers,
            Staff Directors and/or Chief Clerks regarding employment laws
            and the implementation of the CAA;
      --Met individually with 98 of the Members' offices, at their
            requests, to advise them about how to comply with the CAA while
            minimizing costs;
      --Responded to more than 1,850 telephone requests from Members'
            offices for information/advice about employment law matters.
            Most of these requests required at least one face-to-face
            meeting with the office's Chief of Staff and/or Office Manager;
      --Prepared sample employee handbooks and other forms for offices' use
            in complying with the CAA, including a sample employee
            handbook, employee performance evaluations, a sample time
            sheet, sample job descriptions, exempt/non-exempt
            questionnaire, etc.; these were prepared and provided in both
            hard copy and on disk;
      --Prepared and distributed to all Senate offices a management guide
            pertaining to the Occupational Safety and Health Act;
      --Prepared a several-hundred page manual for Senators-elect entitled
            ``Management's Rights and Obligations'' under the CAA; and
      --Prepared and distributed a manual for all Senate offices to inform
            them of their obligations under the CAA.
        Defense of Senate Offices in the Federal Court and at Hearings.--
    The second major activity of the SCCE in 1996 was defending Senate
    offices in federal court and at hearings involving alleged violations
    of employment laws. The SCCE defended Senate offices in 15 such cases,
    under the CAA and the predecessor Government Employees Rights Act.
    These cases were brought against Members' offices (both sides of the
    aisle), the Sergeant at Arms, and the Secretary of the Senate. The SCCE
    either won or successfully negotiated a resolution to 13 of the 15
    cases with the remaining two cases still pending.
        In other instances, the SCCE negotiated and prepared separation/
    termination agreements for Senate offices. These involved situations
    where a Senate office learned, either directly from the employee or
    indirectly, that the employee was considering initiating a case against
    the employing office. Working with the employee and/or his/her
    attorney, the SCCE successfully resolved the matter.
        Representation of Capitol Police in Union Organizing Drive.--The
    SCCE has assisted the General Counsel for the Capitol Police in his
    representation of the Capitol Police Board in the unionization of the
    Capitol Police.
        Advising the Senate about CAA Regulations.--A fourth major activity
    of the SCCE in 1996 was to advise the Senate about the CAA regulations
    proposed by the Office of Compliance.
    Office of Conservation and Preservation
        The Office of Conservation and Preservation develops and
    coordinates programs directly related to the conservation and
    preservation of Senate records and materials for which the Secretary of
    the Senate has statutory authority. Responsibilities of the office
    include deacidification, phased conservation for books and documents,
    collection surveys, and contingency planning for disaster response and
    recovery.
        Leadership.--For more than twenty years, this office has bound a
    copy of Washington's Farewell Address for the annual Washington's
    Farewell Address ceremony. In 1996, the volume was bound for and read
    by Senator Daniel K. Akaka.
        Seven marbled paper slipcases were fabricated for the book, The
    United States Capitol: Photographs by Fred J. Maroon, and were
    presented to visiting dignitaries.
        Three hundred seventy-two items were matted and framed, including
    resolutions, photographs, letters and photographic compilations.
        At the direction of the Secretary of the Senate, and through the
    Office of Interparliamentary Services, fifteen photo albums
    illustrating a congressional trip to Canada and Southeast Alaska were
    embossed with Senator's names.
        At the request of the Secretary of the Senate's Office, four books
    titled, The Senate 1789-1989, were embossed and presented to the French
    National Assembly on behalf of the United States Senate.
        Senate Library.--In 1996, conservation treatments were completed
    for 276 volumes. 374 books were prepared and sent from the Senate
    Library to the Government Printing Office (GPO) for binding.
        In consultation with the Senate Librarian, monies from the 1994
    Book Preservation Fund (established for the preservation of the Senate
    Library books) funded cleaning of books housed in the Senate Library
    vault located at the Library of Congress, Adams Building.
        Office of the Senate Curator.--The office assisted the Office of
    the Senate Curator in the preparation and installation of two exhibits.
    As in past years, the office again repaired, matted and framed a
    quantity of graphics for display in various areas of the Senate wing of
    the Capitol.
        Historical Office.--At the request of the Senate Historian, our
    office bound thirteen volumes of the circa 1940 Acceptance of the
    Statue of Huey P. Long for Senator Russell B. Long.
        Miscellaneous Projects.--We continue to utilize our spray
    deacidification system, encapsulator, and dry mounting press. This year
    we deacidified 153 items, encapsulated 145 items, and dry mounted 115
    items.
        At the request of the Chairman of the Appropriations Committee,
    Senator Hatfield, four books about the Vietnam War were bound in
    leather for presentation.
        At the request of Senator Kerrey of Nebraska, we bound two leather
    books, and matted and framed one item with Senator's signatures for
    Senator Exon's retirement from the United States Senate.
        At the request of the Democratic Policy Committee, ninety-eight
    folders were embossed with the name of each of the committee members.
        The office continued conservation treatment of Appropriation Bills
    from 1877 to 1943. We completed twelve books, last year, with seventy-
    eight books remaining for conservation treatment. These books are part
    of the Appropriations Committee collection.
    Office of Senate Security
        The Office of Senate Security was established in 1987 by Senate
    Resolution 243 (100th Congress, First Session). The office is
    responsible for the administration of classified information,
    personnel, communications and computer security programs in Senate
    offices and committees. Under the policy direction of the Leadership,
    it serves as the Senate's liaison to the Executive Branch in matters
    relating to the security of classified information in the Senate.
        Personnel Security.--OSS initiated requests for personnel security
    clearances on 165 Senate employees during 1996. OSS conducted or hosted
    81 security briefings for Senate staff. An OSS Web Page was developed
    to facilitate the dissemination of security information to Senate
    offices.
        Counterintelligence.--OSS conducted, with the FBI, a review of the
    foreign intelligence threat to the Senate, and the OSS Director
    attended a foreign counterintelligence course taught by the FBI.
        Document Control.--2,563 classified documents were processed
    through OSS' automated document control system. 3,418 classified
    documents, no longer required for the conduct of official Senate
    business, were destroyed. Secure storage of classified material in the
    OSS vault was provided for 120 Senators, committees and support
    offices. This arrangement keeps to a minimum the number of different
    storage areas throughout the Capitol and Senate office buildings,
    thereby affording classified material greater security.
        Secure Meeting Facilities.--OSS secure conference facilities were
    utilized on 704 occasions during 1996. 340 hearings/meetings/briefings
    were conducted in OSS' three conference rooms. In addition, OSS
    provided to Senators and staff secure telephones, secure computers, a
    secure facsimile machine, and secure areas for reading classified
    material on 364 occasions.
        Technical Surveillance Countermeasures.--At the request of the
    Department of Defense, the Deputy Director presented classes on TSCM
    techniques at the Interagency Training Center (ITC). The ITC is the
    Intelligence Community TSCM training facility.
        Automation Projects.--A new local area network was installed during
    1996. The new network includes hardware and software for all office
    applications, including a new classified document control system. Two
    PolicyNet terminals were installed at OSS, to provide Senate employees
    access to a classified, interagency computer network. PolicyNet
    provides on-line access to intelligence reporting and analysis, permits
    secure video conferencing, and facilitates multimedia presentations.
        Classified Document Imaging System.--The processing and storage of
    classified material for the Senate is one of the most important tasks
    performed by the office. OSS receives approximately 2,200 classified
    documents from 98 different departments, agencies and commercial
    sources yearly. The office maintains about 3,400 classified documents
    consisting of 103,000 pages for 106 Senate offices.
        The current archive space for classified documents is reaching
    critical mass. The physical aspects of OSS data storage needs to be
    reduced. Migrating these documents into electronic form exponentially
    reduces the documents into a set of very manageable compact disks. This
    would eliminate the physical document as the media for long term
    storage of Senate classified material.
        A system analysis will be conducted to identify the appropriate
    hardware and software to accommodate the new function. As OSS recently
    upgraded the office local area network, the new network should be able
    to accommodate additional hardware and software to implement a document
    imaging system.
    Senate Stationery Room
        The Stationery Room provides stationery and other office supplies
    for Senators committees, and offices of the Senate. At the request of
    Senate offices, stationery items not carried by the store can be
    obtained through special order.

    Fiscal year 1996 statistical operations

    Gross sales.............................................      $2,961,635
    Sales transactions......................................          88,367
    Generated purchase orders...............................          58,584
    Vouchers processed......................................           6,785
    Metro fare media sold...................................           5,547

        For fiscal year 1996, gross sales were down by $275,593 though the
    number of sales transactions increased by 25,955.
        The Stationery Room customer base consists of approximately 242
    offices and or other legislative organizations which are located in
    nine buildings, many of which have multiple locations. In addition to
    offices' official requirements, the Stationery Room also accommodates
    staff members' personal purchases.
        The Stationery Room carries approximately 1,250 items in inventory,
    supplied by 200 vendors throughout the United States.
        Stationery Room personnel spent considerable time during 1996
    preparing, planning and coordinating activities associated with
    election of 15 new Senators and their entry into the Senate community.
    Interparliamentary Services
        Interparliamentary Services is responsible for administrative,
    financial, and protocol functions for all Interparliamentary
    conferences in which the Senate participates by statute: the North
    Atlantic Assembly; Mexico-United States Interparliamentary Group;
    Canada-United States Interparliamentary Group; and Interparliamentary
    Union. It also handles arrangements for special delegations authorized
    by the Leadership and for other Senate delegations.
        The Office of Interparliamentary Services has completed its
    fifteenth year of operation as a department of the Secretary of the
    Senate. IPS is responsible for administrative, financial, and protocol
    functions for all interparliamentary conferences in which the Senate
    participates by statute, for interparliamentary conferences in which
    the Senate participates on an ad hoc basis, and for special delegations
    authorized by the Majority and/or Minority Leaders. The office also
    provides appropriate assistance as requested to other Senate
    delegations.
        The statutory interparliamentary conferences are: North Atlantic
    Assembly; Mexico-United States Interparliamentary Group; Canada-United
    States Interparliamentary Group; and Interparliamentary Union.
        Known by many in the Senate as the ``protocol office'',
    Interparliamentary Services maintains regular contact with the Office
    of the Chief of Protocol, Department of State, and with foreign Embassy
    officials. Official foreign visitors are frequently received in this
    office and assistance is given to individuals as well as to groups by
    the IPS staff. The staff continues to work closely with other offices
    of the Secretary of the Senate and the Sergeant at Arms in arranging
    programs for foreign visitors. In addition, IPS is frequently consulted
    by individual Senators' offices on a broad range of protocol questions.
    Occasional questions come from state officials or the general public
    regarding Congressional protocol.
        On behalf of the Leadership, the staff arranges receptions in the
    Senate for Heads of State, Heads of Government, Heads of Parliaments,
    and parliamentary delegations. Required records of expenditures on
    behalf of foreign visitors pursuant to Section 2 of H.R. 1827-33 are
    maintained in the Office of Interparliamentary Services.
        As in previous years, all foreign travel authorized by the
    Leadership is arranged by the IPS staff. In addition to Delegation
    trips, IPS provided assistance to eight individual foreign trips. Also,
    Senators and staff authorized by Committees for foreign travel continue
    to call upon this office for assistance with passports, visas, travel
    arrangements, and reporting requirements.
        IPS receives and prepares for printing the quarterly financial
    reports for foreign travel from all committees in the Senate.
        In May, the 37th Annual Meeting of the Canada-U.S.
    Interparliamentary Group was held in Southeast Alaska. Arrangements for
    this successful event were handled by the IPS staff.
        Planning is underway for the 36th Annual Meeting of the Mexico-U.S.
    Interparliamentary Group which will be held in 1997. Also, in 1997,
    advance work, including site inspection, will be undertaken for the
    38th Annual Canada-U.S. Interparliamentary Group Meeting and the 1999
    British-American Parliamentary Group Meeting, both to be held in the
    United States.
        In 1996, IPS moved its office from S-414A of The Capitol to SH-808.
                   interparliamentary services--trips in 1996
        March 31-April 9--Codel Hatfield: Costa Rica, Brazil, and Chile.
    (Senators Hatfield, Pell, Simpson, Heflin, and Murkowski).
        April 3-12--Codel Daschle: Hungary, Serbia, Bosnia, Albania,
    Macedonia, Slovenia, and Croatia. (Senators Daschle, Hatch and Reid).
        April 15-19--Interparliamentary Union--Spring Meeting. Chairman:
    Senator Burns. (No Senators attended).
        May 3-5--Mexico-U.S. Interparliamentary Group--Zacatecas, Mexico.
    Chairman: Senator Hutchison. Vice Chairman: Senator Dodd. (Senators
    Hutchison, Murkowski, Brown, and Coverdell).
        May 10-14--Canada-U.S. Interparliamentary Group--Southeast Alaska.
    Chairman: Senator Murkowski. Vice Chairman: Senator Murray. (Senators
    Murkowski, Chafee, Pryor, Grassley, Gorton, Jeffords, Mack, Burns,
    Bennett, Inhofe, DeWine, and Grams).
        May 16-20--North Atlantic Assembly--Spring Meeting. Vouliagmeni,
    Athens, Greece. Chairman: Senator Roth. Vice Chairman: Senator Heflin.
    (Senators Roth, Heflin and Akaka).
        June 29-July 8--Codel Cochran: Indonesia, Vietnam, and Hong Kong.
    (Senator Cochran).
        September 16-21--Interparliamentary Union--Fall Meeting--Beijing,
    China. Chairman: Senator Burns. (No Senators attended).
        November 8-17--Codel Daschle: Japan, Vietnam, China, Hong Kong and
    Taiwan. (Senators Daschle, Glenn, Leahy, Dorgan and Kempthorne).
        November 16-21--North Atlantic Assembly--Fall Meeting--Paris,
    France/London, England. Chairman: Senator Roth. Vice Chairman: Senator
    Heflin. (Senators Roth, Heflin, Hollings, Sarbanes, Hatch, Warner,
    Grassley, Specter, Murkowski, Breaux, Mikulski, Akaka and Bennett).
         interparliamentary services: official foreign visitors in 1996
        January 22--Members of Parliament of South Africa (11)
        January 31--Delegation of Russian Officials (5)
        January 31--North Atlantic Assembly Defense & Security Committee
    (19)
        February 8--Standing Committee of the Nordic Council (9)
        February 13--Members of Parliament of Ukraine, Romania, and Slovak
    Republic (18)
        February 13--Congressional Scholars from Brazil (2)
        February 29--Secretary General and Members of Parliament of Romania
    (4)
        March 12--Members of Parliament of Belarus (12)
        March 29--His Royal Highness The Duke of York (1)
        May 7--Members of Parliament of Ukraine (5)
        May 8--His Excellency Dr. Janez Drnovsek, Prime Minister of the
    Republic of Slovenia (3)
        May 23--Ms. Sue-chung Chang, Section Chief, National Assembly of
    Taiwan (1)
        June 20--His Excellency Mangala Samaraweera, Minister of Posts and
    Telecommunications of Sri Lanka (6)
        June 26--His Excellency Lennart Meri, President of the Republic of
    Estonia His Excellency Algirdas Mykolas Brazauskas, President of the
    Republic of Lithuania His Excellency Guntis Ulmanis, President of the
    Republic of Latvia (12)
        June 27--Mr. Ming-chuan Chen, Council for Economic Planning and
    Development of Taiwan (1)
        July 9--Delegation of Parliamentarians from Russia, Ukraine,
    Belarus, Kazakhstan, Georgia, and Uzbekistan (14)
        July 10--Delegation from National People's Congress of China (4)
        July 10--Delegation of European Parliament Members (16)
        July 25--Delegation from Chamber of Deputies and Senate of Romania
    (3)
        July 25--Members of Parliament of South Africa (4)
        July 29--North Atlantic Assembly Bureau Meeting (10)
        July 31--His Excellency Mohammed Hosni Mubarak, President of the
    Arab Republic of Egypt (6)
        September 19--His Excellency Dan Meridor, Minister of Finance of
    Israel (5)
        September 23--Mr. Roman Romanovich, Deputy Secretary of the Russian
    Federation Council (1)
        September 27--Her Excellency Wu Yi, Minister of Foreign Trade and
    Economic Cooperation, People's Republic of China (10)
        October 4--Members of Parliament of Bangladesh (10)
        October 9--Members of Parliament and Government Officials from
    France (12)
        November 15--Members of Parliament of Uzbekistan (3)
    Senate Gift Shop
        The Senate Gift Shop provides for the sale of United States Senate
    memorabilia and gift items to the general public, Senators and their
    staff, and foreign visitors in accordance with Public Law 102-392,
    October 6, 1992.
        The Senate Gift Shop completed its first full year of operation
    supporting two locations. The main store opened in October 1992 in Room
    180 of the Russell Senate Office Building, and the second, a sales
    counter, opened in November 1995, in the Capitol Building across from
    the Appointment Desk.
        The Gift Shop provides unique, Senate-specific mementos for sale at
    convenient locations. Sales have dramatically increased in the last
    twelve months and, for the first time, exceeded $1,000,000 for a fiscal
    year. As in previous years, the Gift Shop will be introducing a number
    of new products in 1997.
        The continued sales growth makes it necessary to consider
    increasing and improving the warehousing and mail order areas that are
    now available.
        The Gift Shop is currently working with the Stationery Room on
    separating and upgrading the current computer system that is now a
    shared unit. We are considering several different methods of achieving
    this and will take into consideration growth projections and the
    potential future needs of both the Gift Shop and the Stationery Room.
    Office of Public Records
        The Office of Public Records receives, processes, and maintains
    records, reports, and other documents filed with the Secretary of the
    Senate under the Federal Election Campaign Act, as amended; the
    Lobbying Disclosure Act of 1995; the Senate Code of Official Conduct:
    Rule 34, Public Financial Disclosure; Rule 35, Senate Gift Rule
    filings; Rule 40, Registration of Mass Mailing; Rule 41, Political Fund
    Designees; and Rule 41(6), Supervisor's Reports on Individuals
    Performing Senate Services; and Foreign Travel Reports. The office
    provides for public inspection, review, and reproduction of these
    documents.
        Byrd Amendment.--The final filings under the Byrd Amendment (a
    filing obligation repealed by the Lobbying Disclosure Act of 1995)
    generated submissions from 36 Federal agencies totaling 141 reports
    with 276 pages.
        Federal Election Campaign Act.--The Act required Senate candidates
    running for election in 1996 to file quarterly, pre-election and post
    election reports in an election year. Candidates running for election
    in a year other than 1996 filed semi-annual reports. Filings totaled
    6,791 documents containing 95,584 pages.
        Federal Regulation of Lobbying Act.--This law was repealed
    effective January 1, 1996. From October 1995 through January 1996,
    9,205 reports totaling 56,599 pages were filed, processed and made
    available to the public.
        Lobbying Disclosure Act of 1995.--The Lobbying Disclosure Act of
    1995 superseded the Federal Regulation of Lobbying Act effective
    January 1, 1996. The goals we established and met were: (1) to develop
    forms and informational material for outreach to the filing community;
    (2) to determine the scope and nature of automation for the resulting
    filings; (3) to review the filings for accuracy and completeness; and
    (4) to provide the appropriate context for the information to the
    public and press examining the reports. As of September 30, 1996, 3,557
    registrants represented 8,188 clients and employed 11,702 individuals
    who met the statutory definition of ``lobbyist.'' The lobbying
    documents were microfilmed and indexed into a temporary data base
    pending the development of an automated data base system to include
    imaging (for paper copies received) and electronic components. The
    Public Records staff has reviewed the filings and is notifying those
    whose forms are incomplete.
        Public Financial Disclosure.--A total of 2,821 reports and
    amendments were filed containing 16,089 pages. There were 484 requests
    to review or receive copies of the documents.
        Senate Rule 35 (Gift Rule).--On January 1, 1996, the revised Senate
    Rule 35 took effect as a result of passage of S. Res. 158 on July 28,
    1995. The Rule contained four new filing requirements for Senators and
    Senate staff. The office received over 1400 reports totaling 1560 pages
    during fiscal year 1996.
        Registration of Mass Mailing.--Senators file mass mailings
    registrations quarterly. The number of pages filed were 781.
        Public Inquiries.--From October, 1995, through September, 1996, the
    Public Records office staff assisted more than 2,700 individuals
    seeking information from reports filed with the office. This figure
    does not include telephone assistance. A total of 115,217 photocopies
    were sold in the period.
        Automation Activities.--During 1996, Public Financial Disclosure
    reports were scanned using optical imaging technology. Due to passage
    of the Lobbying Disclosure Act, the lobbying function will be converted
    from microfilming to optical imaging (for paper reports) before the
    Federal Election Campaign Act application. The office has been working
    to develop an automated data base that is able to accept non-paper
    transmissions (electronic filing) as well as paper filings.
    Senate Historical Office
        Serving as the Senate's institutional memory, the Historical Office
    collects and provides information on important events, precedents,
    dates, statistics, and historical comparisons of current and past
    Senate activities for use by members and staff, the media, scholars,
    and the general public. The Office advises senators, officers, and
    committees on cost-effective disposition of their non-current office
    files and assists researchers in identifying Senate-related source
    materials. The Office keeps extensive biographical, bibliographical,
    photographic, and archival information on the more than 1,700 former
    senators. It edits for publication historically significant transcripts
    and minutes of selected Senate committees and party organizations, and
    conducts oral history interviews with retired senior Senate staff.
        Vice Presidents of the United States, 1789-1993.--Working with
    Senator Mark Hatfield, the Historical Office completed a series of 44
    chapter-length essays tracing the career of each Vice President through
    1993. The Government Printing Office published the resulting 700-page
    book in April 1997.
        Fiftieth-Anniversary Histories of the Republican and Democratic
    Policy Committees.--In cooperation with the Senate Republican Policy
    Committee, the Office completed an 80-page narrative history of that
    organization for publication in mid-1997. Work also advanced on a
    companion volume detailing the first half-century of the Democratic
    Policy Committee.
        Minutes of the Republican and Democratic Party Conferences, 1903-
    1964.--The Office is editing for publication the official minutes of
    each party conference, dating from the start of the twentieth century
    through the mid-1960's. Democratic Conference minutes are ready,
    subject to Conference review. Work is proceeding on a companion volume
    for the Republican Conference.
        Documentary History of the United States Senate.--The Historical
    Office is currently at work on two volumes in this ongoing project
    designed to bring together fundamental sources illuminating development
    of the Senate's constitutional powers and institutional prerogatives.
    Volume One deals with the impeachment process; Volume Two details the
    evolution of the Senate's rules.
        Biographical Guides.--The Historical Office continued to maintain
    and update its large biographical databases, including the Biographical
    Directory of the United States Congress, 1774 to present (Senate
    entries), Senators of the United States: A Historical Bibliography, and
    Guide to Research Collections of Former United States Senators, 1789 to
    present.
        Oral History Program.--During the year, the Office conducted oral
    history interviews with the following former Senate officials:
    Secretary of the Senate Kelly Johnston, Senate Legal Counsel Michael
    Davidson, Enrolling Clerk Brian Hallen, Democratic Secretary C. Abbott
    Saffold, and Charles Caldwell, a staff member of former Senator Ralph
    Yarborough (D-TX).
        On-line Reference Service.--In March the Office began providing on-
    line reference assistance to Senate offices and the public via the
    Internet. The Office offers information on the Senate's history and
    practices, and biographical and bibliographical information on former
    members.
        Senate Chronology.--The Office began a chronology outlining
    significant events in the Senate's institutional history. This work,
    currently comprising 1,200 entries, is approximately half-way to the
    point where it can be considered reasonably comprehensive.
        Senators' Office Records Management and Disposition Assistance.--
    The 104th Congress saw sixteen senators depart. The Office provided
    extensive assistance to these closing offices.
        Committee Records Management and Disposition Assistance.--By year's
    end, the Office had processed 1,700 cubic feet of committee records for
    transfer to the National Archives.
        Educational Outreach: Historical Information for the Senate Home
    Page.--Beginning with September, the Office produced a home-page
    feature entitled ``This Month in Senate History.'' The entries for each
    month highlight approximately twenty institutionally significant events
    that have occurred during that month throughout more than 200 years of
    Senate history. The Office also participated in the construction of a
    ``Quick Time Virtual Reality Tour of the Senate.''
        Advisory Committee on the Records of Congress.--The Historical
    Office provides staff support to this eleven-member permanent
    committee, which meets twice a year to advise Congress on the
    management and preservation of its records.
        Photographic Collection.--The Office maintains a collection of
    approximately 30,000 still pictures that includes photographs and
    illustrations of most former senators, as well as news photographs,
    editorial cartoons, pictures of committees in session, and related
    images documenting Senate history. The Office provided photographic
    reference assistance to congressional offices, scholars, journalists,
    and publishing houses, and furnished photographic images to individual
    requestors. The photo historian instituted a system ensuring coverage
    of the contemporary Senate by photographing each committee while in
    session, collecting formal portraits of each incumbent Senator, and
    identifying and capturing significant Senate events.
    Office of the Senate Curator
        The Office of Senate Curator, under the direction of the Senate
    Commission on Art, administers the museum programs of the Senate for
    the Capitol and Senate office buildings. The Curator and staff suggest
    acquisitions, provide appropriate exhibits, engage in research, and
    write and edit publications. In addition, the office studies,
    identifies, arranges, protects, preserves, and records the historical
    collections of the Senate, including paintings, sculpture, and
    furnishings, and exercises supervisory responsibility for those
    chambers in the Capitol under the jurisdiction of the Senate Commission
    on Art. All records of research and documentation related to these
    areas of responsibility are available for use by members' offices, the
    media, scholars, and the public. With the establishment of the United
    States Capitol Preservation Commission, the Senate Commission on Art
    became the designated recipient of objects with Senate association
    received by the Preservation Commission.
        Exhibitions and Publications.--The Curator's office maintained an
    active exhibition program, installing four new exhibits in the Senate
    wing of the Capitol, including a major presentation on ``Isaac Bassett:
    The Venerable Doorkeeper, 1832-1895.'' An exhibit panel for the
    painting The Battle of Lake Erie was developed, as part of a continuing
    effort to provide educational information to visitors. In addition, the
    office installed the second in a series of interactive exhibitions.
        In the area of publications, the office redesigned and reprinted
    the small booklet on the Lyndon Baines Johnson Room (S-211), and the
    brochures The United States Capitol and Congress and Postmarked
    Washington D.C.: Visitors to the Capitol, and finalized printing of the
    publication on the Dedication and Unveiling of the Statue of Richard
    Brevard Russell, Jr.
        Historic Chambers.--The Curator's staff continued to maintain the
    Old Senate and Old Supreme Court Chambers, coordinating periodic use of
    both rooms for special occasions. Along with general care and
    maintenance, other concerns included reconditioning two historic clocks
    and repair of water damage to the Old Senate Chamber ceiling. Work was
    completed on a permanent ramp in the Old Senate Chamber, which meets
    ADA compliance for historic structures.
        Collections: Acquisitions and Management.--A number of significant
    works and documents were donated to the Senate collection, including a
    portrait of Senator Hattie Caraway (D-AR), the full-length painting of
    Senator Mike Mansfield (D-MT), a portrait of Senator Lee Slater Overman
    (D-NC), the ``Isaac Bassett Papers,'' and objects from the
    Smithsonian's Warshaw Collection of Political Memorabilia. A major
    collection of 68 drawings detailing the filming of the movie Advise and
    Consent was obtained for the collection, and the Curator's office
    acquired 111 19th century prints.
        In the area of collections management, the staff processed incoming
    and outgoing loans for the Senate leadership, continued to loan and
    monitor the approximately 280 reproduction prints in offices under the
    jurisdiction of the Secretary of the Senate, assisted several Senator's
    offices with loans, and continued to research and catalogue the
    extensive Clifford and Jim Berryman political cartoon holdings.
        Conservation and Restoration.--The office completed the first phase
    of the reorganization and reinterpretation of the vice presidential
    bust collection, had professionally cleaned and conserved the 20 vice
    presidential busts in the Senate Chamber, and began conservation on the
    frame for the painting The Electoral Commission and the frame and
    painting Leiv Eiriksson Discovers America.
        Collaborations, Educational Programs, Events.--The staff continued
    to assist the seminar program under the Secretary of the Senate and the
    Senate Sergeant at Arms by presenting three new lectures to Senate
    staff. The office collaborated with the Senate Historical office in a
    new educational venture with C-SPAN, presenting short historical
    programs, narrated by a Senator or Senate officer, highlighting some
    aspect of the Senate's history or art.
        Automation.--The office worked closely with the Senate Computer
    Center to expand the Curator's homepage on the internet and develop a
    virtual tour of the Capitol using QTVR technology.
        Plans for 1997.--Conservation concerns continue to be a priority,
    with plans to conserve several major paintings in the Senate
    collection. Two new exhibits are scheduled, along with explanatory
    labels for several works of art. Publications planned include booklets
    on the history of the Foreign Relations Committee Room, the Presidents
    Room, and the Vice President's Room. Editing and fact-checking of the
    Guide to Senate Fine Arts is scheduled, as is work on the second volume
    highlighting the Senate's collection of prints. A comprehensive
    disaster preparedness, management, and response plan will be developed
    for the Senate collection.
    Senate Page School
        The Senate Page School provides for the education of Senate pages
    pursuant to Public Law 98-51, Public Law 98-125 and Senate Resolution
    184, July 29, 1983.
        Summary of Accomplishments.--The Senate recess this past fall
    provided the Page School with the opportunity to offer additional
    instructional time during the months of October-December. Normally,
    school is conducted between the hours of 6:15-9:45 A.M. For the three
    months of recess, school was conducted from 7:15-11:15 A.M.
    Additionally, school was in session on average an additional half day a
    week. School also met on three Saturdays during the fall 1996 semester.
        Field trips were taken to various historic sites, government
    buildings, museums, and theatrical performances. Speakers included
    college and military representatives. Dr. Ogilvie, Chaplain of the
    Senate, Kelly Johnston, then Secretary of the Senate, and Bob Dove,
    Senate Parliamentarian, shared information about their work in the
    Senate.
        New equipment and software were purchased and installed. Six
    computers for student use were installed in the math classroom to
    accommodate the math curriculum. CyberPatrol, a software package which
    allows regulated access to the Internet was ordered and a CD tower
    which will allow for further networking has been delivered. A color
    printer has also been delivered.
        A new precalculus text, a replacement physics text, and an updated
    American history text were purchased. An advanced composition test was
    also selected and purchased, as well as a workbook for all English
    classes.
        A PSAT preparation course was offered this fall to interested pages
    and the PSAT was administered on the national testing date. Foreign
    language tutors worked with students in the areas of French, Latin,
    Spanish, and German. The Page School staff remained the same as in the
    previous year. The four teachers taught a combination of eleven courses
    this year. All faculty attended ``The Critical Thinking Workshop''; the
    science teacher participated in the Space Policy Institute workshop
    conducted at George Washington University; the English instructor
    attended a workshop entitled ``Developing Writing and Thinking Skills
    Across the Curriculum,'' and was selected to participate in a summer
    offering at the Holocaust Museum; the social studies instructor
    attended the 1996 History Forum in Williamsburg, Virginia last fall.
        Summary of Plans.--Students will complete their semester
    curriculum. Needs of the incoming students will determine the second
    semester schedule. Supervised study exists for pages attending Page
    School less than a semester. Extended day schedules, tutoring by
    teachers on an as-needed basis, and individualized small group
    instruction will continue. These various strategies will provide for
    the delivery of the curriculum.
        Foreign language tutors will accommodate the needs of the incoming
    pages. Field trips to Williamsburg and Baltimore are planned for the
    second semester. The focus is on historic and political significance as
    well as architecture. College visits are incorporated where possible as
    a critical component of the junior year curriculum.
        The self-study phase of the accreditation process by the Middle
    States Association of Colleges and Schools will be completed by the
    staff. Plans to host the accreditation visitors will be finalized, and,
    hopefully, the visit will take place spring 1997.
        Staff development opportunities will be explored. A review will be
    conducted in all subjects to determine which, if any, textbooks need to
    be replaced. Software will be reviewed and new requests will be
    investigated. The Windows scheduling component of the records
    management system will be installed.
    Information Systems Department
        The staff of the Department of Information Systems provide
    technical and user support for the Office of the Secretary of the
    Senate. Information Systems staff also work closely with the Government
    Printing Office (GPO), the Senate Computer Center (SCC), and the Senate
    Office of Telecommunications (Telecom) on technical issues and joint
    projects. The Department provides technical and user support for the
    ten computer systems in the Office of the Secretary of the Senate (five
    Novell LAN's; three Windows NT LAN's; a retail computer system in the
    Stationery Room; and a FileNet imaging system in the Office of Public
    Records).
        Improvements to the Secretary's LAN's.--The Senate chose Windows NT
    as the standard network operating system several years ago and the
    Secretary's Office will use Senate-supported systems whenever possible.
    Every new system installed in 1996 was a Windows NT system, and
    additional conversions from Novell to Windows NT are planned. This may
    allow the Office of the Secretary to rely on the Senate Computer Center
    and I-Net for some system support.
        The Secretary's Novell LAN supports approximately 175 users in the
    Capitol and the Senate Hart Buildings. The LAN operating system was
    upgraded, new servers were installed in October, and all 386 PC's were
    replaced with new Pentium computers.
        Telecom and the Secretary's IS staff worked together this year to
    migrate the Office of the Secretary from the older technology of
    accessing the mainframe via coax cabling and controllers to accessing
    it via IP and the fiber optic cabling backbone now in place. Also the
    Secretary's network cable configuration was upgraded to switched
    ethernet.
        Several technology resources were made available for use by all
    Secretary staff: laptop computers and portable printers; a high-end
    scanner; a low-end color printer; Lexis/Nexis and Westlaw commercial
    information services; and Internet e-mail and World Wide Web access.
        Several departments have had repetitive tasks automated using the
    macro scripting language in Word Perfect. When a new version of
    WordPerfect is installed, all the macros must be updated and re-coded.
    These scripts should be written in a programming language independent
    of any application. Microsoft Visual Basic 4.0 and Delphi were
    purchased and computer staff will begin recreating WordPerfect macros
    in Visual Basic when feasible.
        For a variety of reasons several Departments have their own
    computer systems. In most cases the separate systems hold unique
    applications. In some cases, separate LAN's were set up for security
    reasons.
        The Official Reporters' and Captioners' LAN.--The Official
    Reporters and Captioners have a separate Novell server. They use
    specialized software called Computer Aided Transcription (CAT) for
    translating their steno code into English. The Xscribe CAT software was
    upgraded to the newer version. Also in 1996 we upgraded the Novell LAN
    operating system and installed a new server and, to support their heavy
    printing needs, a high-end printer was purchased and installed.
        The Senate Gift Shop's LAN (in two separate locations).--At the
    request of GAO, for security reasons, the Gift Shop LAN cannot be
    connected to the Secretary's LAN or to the Senate Fiber Network (SFN).
    The Gift Shop LAN houses their inventory and transaction records. Plans
    are underway to set up some workstations in the Gift Shop that would be
    connected only to the Secretary's LAN to provide cc:mail and internet
    access.
        The Page School's LAN.--The Page School currently has a Novell LAN,
    but a Windows NT LAN will be installed in the near future. Users
    include the administrative staff, teachers, and students.
    Administrative staff use the Blackbaud program for students records and
    grades. These records are confidential. In 1996 Internet access and e-
    mail was provided to students and staff and CyberPatrol, a software
    package which regulates access to the Internet was installed to prevent
    access to unacceptable sites. A CD tower was purchased and will be
    installed in early 1997.
        The Office of Senate Security's LAN.--The Office of Senate Security
    inventories and tracks all classified information that comes into the
    Senate. In the Fall of 1996 their system was completely upgraded from a
    Novell system to a new Windows NT LAN with top-of-the-line equipment
    and a new Document Management System was purchased. For security
    reasons, the computer systems in Senate Security cannot be connected to
    any other system in the Senate so two PC's connected to the Secretary's
    LAN (and not to their LAN) have been installed so that staff can have
    access to cc:mail and the internet.
        The Senate Disbursing Office LAN.--In 1996 the Disbursing Office
    installed a Windows NT LAN in Disbursing for desktop applications, and
    attempted to install a server to run DOVES, the general ledger. The
    office automation upgrade was fine, but the upgrade of the DOVE's
    server caused data to be corrupted and after almost two-weeks of
    attempts to salvage the upgrade the Disbursing Office had to roll-back
    to their original system. Thus, the Disbursing Office still maintains
    one separate 3-Com LAN for DOVES.
        The Office of Public Records (OPR).--OPR uses FileNet, a UNIX-based
    document management and imaging system, for maintaining public records
    such as lobbying forms; campaign finance reports; and financial
    disclosure reports. PC's are available to the public for searching,
    viewing, and printing these documents. The FileNet workflow system
    includes scanning the original document into the database, inputting
    some data regarding the document, and then microfilming it for archival
    purposes. In 1996 we installed a unique, high-end, Kodak 990D scanner
    that handles the dual functions of digitizing images and microfilming
    documents.
        When the Lobbying Disclosure Act was signed into law, a system to
    capture only the minimum identifying data on each report filed was
    created. A complete database system for lobbying is being developed.
        A working group has been established to tackle the many issues
    currently facing OPR, including: upgrading the System Hardware and the
    FileNet; finishing applications for on-site public access to the
    records; and developing a system for remote public access via the
    internet.
        One staff member of the Department has been assigned to OPR as
    full-time Systems Administrator, and the Senate Computer Center has
    assigned a full-time programmer to write an application to allow the
    public access to various filings, including: Financial Disclosure
    Reports, Campaign Finance Reports, and Lobbying Reports. Currently only
    the Financial Disclosure part of the application is finished.
    Development continues on the other modules.
    Senate-wide information technology projects authorized by the Secretary
        The Strategic Planning Process Initiative.--The strategic planning
    project was initiated by the Rules Committee in early January 1996. The
    first meeting set up a structure for the project. A management team,
    consisting of the Secretary of the Senate, the Sergeant at Arms, and
    the Chairman and Ranking Member of the Rules Committee (or their
    representatives). A Working Group of representatives of these offices
    began meeting and identified several items which we felt were
    significant and should be looked at during this process, including: an
    integrated legislative information system; an integrated financial
    management system; internet services; desktop strategies (technology at
    each person's workstation); security; constituent mail systems;
    customer service and support; video conferencing; and infrastructure.
    Advisory groups studied each issue and produced final reports.
        Consultants with an expertise in strategic planning have been hired
    to formalize the strategic planning process in the Senate.
        The Senate Legislative Information System Initiative.--The
    Legislative Information System (LIS) initiative will automate the
    preparation of legislative information moving closer to a paperless
    process and provide comprehensive search mechanisms for helping users
    access the information they need without having to know where that
    information is stored. Legislative information is currently created and
    maintained by several different offices in the legislative branch, and
    official information (legislative information that has reached the
    Floor) is not available online until the next day.
        Other legislative branch agencies are currently redesigning their
    legislative information systems. With proper cooperation and
    communication among the legislative branch agencies we can develop
    systems that work together, without unnecessary duplication, and that
    meet everyone's needs. To achieve our objectives, this project will
    require a sustained, multi-year effort by the Senate, in coordination
    with the House, and supported by the legislative branch support
    agencies.
        The 1996 Legislative Branch Appropriations Act required the LOC to
    undertake a study and submit a plan for developing a single, integrated
    legislative information system. The goal was the development of a
    system that would reduce duplication and at the same time improve the
    quality of the legislative information available to the entire
    Congress. In 1996 we successfully worked with the appropriators to have
    the authority and funding for this project addressed in statute (see
    Title I, Sec. 8 of the 1997 Legislative Branch Appropriation Act).
        Designing the System.--The Senate, through a standard RFP
    procurement process, contracted with KPMG/Peat Marwick to provide a
    design concept for the Legislative Information System, and at the
    option of the Senate, to draft a detailed requirements document for
    inclusion in a solicitation should the Senate decide to proceed with
    the actual development of the System. Specifically, KPMG performed the
    following functions:
        Developed of an overall, high-level, design concept:
      --Conducted an operational analysis of the existing legislative rules
            and procedures;
      --Analyzed and assessed the needs of the potential users of the
            System;
      --Analyzed and recommended potential system designs and architectures
            to capture information from document creation and that include
            workflow and tracking capabilities;
      --Analyzed existing applications for potential integration into the
            new system and recommended development of new internal
            applications, where needed;
      --Identified aspects of the existing legislative process which are
            not subject to automation; and
      --Explored the benefit and feasibility of integrating existing
            commercial legislative and news services into the Legislative
            Information System.
        Developed an overall program plan:
      --The final deliverable by KPMG was an overall implementation plan
            based upon the design concept approved by the Senate. This
            program plan included a project schedule; identified resources
            required to develop the System; and established a multi-year
            project budget with a detailed breakdown of first-year
            expenditures. KPMG finished their study and provided the
            program plan on January 24th. The Secretary of the Senate, the
            Sergeant at Arms, and the Staff Directors of the Rules
            Committee met and accepted the final report.
        A Program Office, staffed by KPMG and Senate staff, was established
    in early 1997 and a project manager was hired. The program office and
    project manager will set up a management structure for the remainder of
    the LIS project; detail the scheduling and staffing for six
    subprojects; manage and track the projects through their completion;
    produce a detailed RFP for publication; and provide oversight on the
    development of the LIS system.
        Full Text Amendment Scanning Project.--KPMG developed functional
    requirements for an amendment scanning system. They recommended using a
    document management system similar to what might be used in the larger
    LIS system. Based on KPMG's design, the SCC developed the amendment
    scanning system in two months. The Bill Clerks receive the xeroxed copy
    of the amendment and scan it in within minutes of its introduction on
    the Floor. The amendment number, bill number, and sponsor are added to
    the record and the amendment is available for viewing by all Senate
    staff with a browser and Acrobat Reader. A pilot test is underway and
    in a few weeks it will be released to the full Senate.
        The Senate/House SGML Data Standards Initiative.--The Secretary of
    the Senate and the Clerk of the House are working together to establish
    a standard for data exchange. That standard will be the Standard
    General Markup Language (SGML). Each Legislative Branch agency was
    surveyed about their ongoing SGML projects. We contracted with The
    Mulberry Group, to analyze agency survey responses and make
    recommendations as to our next step. Based on the findings of the
    Mulberry report and negotiations between the Clerk and Secretary, the
    next step is to begin work on developing a SGML DTD (an agreed upon
    structure) for Bills. A Committee of representatives from the Senate
    (including staff from the Secretary, the SAA, and the Legislative
    Counsel), House, Library, and GPO will work together on this project.
        Internet Technologies: The Senate WWW Home Page.--The Senate World
    Wide Web (WWW) Home Page was one year old on October 20, 1996. The Page
    had been averaging 50,000 hits a day and that number rose to about
    70,000 per day in September 1996. The Secretary's Office is responsible
    for the legislative and institutional content of the Home Page.
        The Financial Management System (FMS-II) Project.--This project
    will take the Senate from a cash-based to an obligation-based
    accounting system. It will provide online data entry of purchase and
    voucher information, and storage and retrieval of scanned images of
    supporting documentation for viewing side-by-side with voucher data.
    The Secretary has hired a high-level Project Manager to run this
    project.
        As a first step in the ``paperless'' bill paying process envisioned
    under the FMS-II project, the project team, in previous years,
    developed the Senate Office Accounting System (SOAS), a Paradox-for-
    DOS-based standalone system, used by Senate offices to prepare vouchers
    and track office accounts. This system eased the administrative burdens
    of bill paying for Office Managers and introduced the concepts of
    obligation-based accounting to the Senate. During 1996, the project
    team continued to enhance SOAS, provide ``follow-up'' training for new
    users, troubleshoot hardware and software problems, and write
    procedures for using the system.
        The project team arranged access to SOAS for departing Senators so
    that vouchers can be prepared for invoices received after the Senator's
    term expires. SOAS records were copied from each Senator's office
    requesting it, and were copied to either a PC in the Disbursing Office
    available by appointment to Office Managers from these offices, or to
    the PC of a former Office Manager who accepts a job in a new Senator's
    office. Although requested, the project team did not copy data to the
    personal PC's of any former Office Managers.
        A first version of the Senate Time and Attendance Reporting System
    (STAR) was virtually completed by January 1996. This system was
    developed before the governing regulations were issued by the Office of
    Compliance. The initial version had a standard Monday-Sunday workweek.
    Deployment was halted when it became apparent that users needed a
    system that provided for variable workweeks. Incorporating such
    flexibility required a near total rewrite of the system that was
    completed only near the end of 1996. The new version not only allows
    offices to have different workweeks, but allows offices to establish
    different workweeks for each employee. The new version of the system
    has been in operation in two pilot offices since June 1996 while it was
    under development. In December 1996 it was deployed to three additional
    pilot offices. These offices have had some suggestions for change and
    enhancement that are being incorporated as it is deployed further. The
    system will be provided to additional pilot offices during the Spring
    of 1997.
        During 1996, the Request for Proposals that was issued in 1995 for
    the central accounting system, which will be the core of the overall
    new Senate Financial Management System, was canceled and a different
    solicitation--a Letter of Interest--was issued to the seven vendors
    with such products on the GSA Schedule. Responses were received from
    five companies. Evaluations were put on hold pending the Secretary's
    employment of a high-level Project Manager.
        During the year, a Memorandum of Understanding was entered into
    with the Department of the Treasury, Financial Management Service,
    Center for Applied Financial Management for assistance in evaluating
    proposals and in installing and implementing the new system.
        Advisory Committee on the Records of Congress.--An eleven-member
    permanent committee, established by Public Law 101-59, meets twice a
    year to advise Congress and the Archivist of the United States on the
    management and preservation of the records of Congress. Its Senate-
    related membership includes appointees of the Majority and Minority
    Leaders, the Secretary of the Senate, and the Senate Historian.
        A Task Force on the Impact of Technology on Archival Documentation
    of Congress will compile an inventory of major computer systems in use
    in the Senate and the House of Representatives, identify permanently
    valuable information, and make recommendations for data migration and
    preservation. The Task Force in conjunction with representatives of the
    Clerk of the House is in the process of identifying all types of
    electronic data in the Secretary's office that need to be archived. A
    draft report is due to the full committee in June.
                                     ______

                      Biographical Sketch of Gary L. Sisco
        Gary L. Sisco was elected and sworn in as Secretary of the Senate
    on October 1, 1996. Born and raised in Bolivar, Tennessee, he was
    educated at the University of Mississippi, where in 1967 he earned a
    bachelor of science degree in civil engineering, and The George
    Washington University, where in 1970 he earned a master of science
    degree in administration.
        Secretary Sisco served in the United States Army from 1968 to 1970.
    In 1970, he rejoined IBM's Memphis, Tennessee, Data Processing
    Division, where he had been employed prior to entering military
    service. A year later, he joined the staff of Senator Howard H. Baker,
    Jr. (TN). He left Senator Howard Baker's staff as executive assistant
    in 1973, when Lamar Alexander appointed him manager for his 1974
    campaign for governor of Tennessee. Mr. Sisco then served, from 1975 to
    1977 as administrative assistant to U.S. Congressman Robin Beard (TN).
        From 1977 until 1996, Mr. Sisco was in the real estate investment
    business in Nashville, Tennessee. Secretary Sisco is married and has
    three children.
                                     ______

                   Prepared Statement of Stuart F. Balderson
        Mr. Chairman, I appreciate the opportunity to present to your
    Committee, the Budget of the United States Senate for fiscal year 1998.
        Mr. Chairman, the fiscal year 1998 budget estimates for the Senate
    have been included in the Budget of the United States Government for
    Fiscal Year 1998. This Budget has been developed in accordance with
    requests and proposals submitted by the various offices and functions
    of the Senate. The total budget estimates for the Senate are
    $522,751,000, which reflect an increase of $39,156,000, or 8.10 percent
    over the amount appropriated for fiscal year 1997 and does not reflect
    any adjustments to these estimates which may be presented to your
    Committee during these hearings. The total appropriations for the
    Senate for fiscal year 1997 are $483,595,000. An individual analysis of
    the budget estimates for all functions and offices has been included in
    the Senate Budget Book, previously provided to your Committee.
        The budget estimates for fiscal year 1998 are divided into three
    major categories as follows:

    Senate Items............................................     $83,847,000
    Contingent Expense Items................................     394,928,000
    Joint Items of the Senate...............................      43,976,000

        Specifically, Mr. Chairman, the increase for fiscal year 1998 over
    the fiscal year 1997 enacted levels is a result of: (1) $15,989,000
    increase in the budget estimate for Senators' Official Personnel and
    Office Expense Account to fully fund the allowances which are under-
    funded as a result of the consolidation of population categories,
    increases in the populations of various states, and the increase in the
    Legislative Assistance Allowance authorized in the Legislative Branch
    Appropriations Act, 1993; (2) $5,034,000 for the anticipated 2.8
    percent cost of living increase for fiscal year 1998, and the
    annualization costs of the fiscal year 1997 cost of living adjustment;
    (3) $3,737,000 for personnel adjustments other than the cost of living,
    attributable primarily to Expenses of Inquiries and Investigations, and
    to the Capitol Police, including $141,000 for Capitol Police
    comparability increases; (4) $210,000 for estimated overtime costs,
    excluding Capitol Police; (5) $3,453,500 increase in agency
    contributions applicable to the cost of living adjustments and other
    personnel increase requests; (6) $10,732,500 increase in non-payroll
    expense requests, attributable primarily to the Office of the Sergeant
    at Arms and Doorkeeper.
        Mr. Chairman, I submit for the consideration of your Committee, the
    Budget of the United States Senate for fiscal year 1998.

        Senator Bennett. Thank you. You anticipated a number of the
    questions that I was intending to ask. We appreciate that and
    we appreciate your service.

                            Hearing tracking service

        Let me stray a little bit to ask you a question you are
    probably not prepared for, so you might want to think about it.
    But in the legislative information service, think about how
    difficult it would be to add a tracking service of hearings so
    that someone could call in--someone being not only the public,
    but more particularly perhaps a Senator's office--and say what
    hearings are scheduled on x number of days and what conflicts
    exist between Senators. You could track that Senator Dorgan,
    for example, had this hearing coinciding with a Democratic
    leadership meeting that is taking place simultaneously and he
    has to shuttle back and forth between the two of them. A
    chairman of a subcommittee could access and realize that if
    this hearing were scheduled at 10 o'clock, the members of the
    subcommittee would run into these kinds of conflicts. If the
    hearing were at 11 o'clock, they would be alleviated somewhat
    and so on.
        Do you have a view as to how tough that would be to
    implement?
        Mr. Sisco. My view is that that would be fairly simple to
    implement, to design, and incorporate into it. I think the key
    to that would be having everyone participate and actually input
    their own schedules where there would be good information in
    it.
        We have retained KPMG Peat Marwick to do a design document
    with all the requirements for LIS, and this and anything else
    that you would want we can put in there and see what would be
    required to do it. But my take is that that would be an
    excellent thing to do and would be easy to do.
        Senator Bennett. I would appreciate your doing a little
    work on that.
        As I go around to my fellow Senators in my assignment from
    Senator Lott to talk about ways in which the Senate can be
    restructured to make it more efficient, I find other Senators
    list this as one of their most serious complaints. Their
    schedules are constantly conflicting. I realize you probably
    cannot train committee chairs to ever pay any attention to
    anybody's initiatives but their own, but if this service were
    available and some kind of moral suasion out of the leader's
    office could be brought to bear on committee and subcommittee
    chairs to get them to check with this and try to make their
    schedule a little more compatible to the circumstances of the
    committee members, we might begin to move in the direction that
    people would like us to move around here.
        I would appreciate it if you would give that some thought,
    and then at some point we might visit again about it.
        Mr. Sisco. I will.
        Senator Bennett. Some quick housekeeping questions. When
    your office receives a voucher, how long does it take before
    the vendor is paid?
        Mr. Sisco. When I got here, it was 6 to 7 weeks. There were
    five or six positions in the Disbursing Office that were not
    filled and they were short-handed. We addressed that. Stuart
    Balderson and his people have done an excellent job. We have
    added some people and without raising unrealistic expectations,
    we are now down below 2 weeks.
        The first goal was to pay our bills within 30 days, which
    ought to be done with no problem. Second, to make sure that we
    pay them on time. Third, to get discounts, and just move them
    up on a responsive basis.
        Right now I am informed that we are under 2 weeks and that
    is what we plan to continue to do. If anyone in the room knows
    anything to the contrary, I would like for them to see Stuart
    and me afterward.
        Senator Bennett. OK, very good.
        Are the amount of discounts available for prompt payment a
    significant amount of money? Are we talking about--what
    percentage if the bill is paid within 10 days?
        Mr. Sisco. I have not personally looked at that. I was
    going on the assumption that with the funds there and with the
    obligation there, that once we got caught up and we were
    looking at the financial system, that whatever money there is
    there for prompt payment or for discount, that we ought to get
    it.
        Senator Bennett. Prior to your coming, the office began to
    look into cost savings that could be generated by consolidating
    the Office of the Stenographers and the Hearing Impaired
    Transcribers. Do you have any information on where that study
    is or what became of it?
        Mr. Sisco. Senator Bennett, I have read that study and it
    probably has some merit just from an organizational standpoint
    or an efficiency standpoint. But candidly, it is not a high
    priority of mine--it has not been and it is not right now--with
    everything else that we have got going. It is something that I
    will continue to review, but again the critical thing there, I
    think, is service--getting the information from the floor and
    getting it transcribed timely and accurately and getting it in
    written form. But I do not have a plan for that right now.
        Senator Bennett. OK, thank you very much.
        As I say, I think you covered the other questions in your
    statement. If we decide you did not, we will send you a
    question or two in writing. But we appreciate your being here
    and we appreciate your service to the Senate.
        Mr. Sisco. Thank you, Mr. Chairman.
                 Office of the Sergeant at Arms and Doorkeeper

    STATEMENT OF HON. GREGORY S. CASEY, SERGEANT AT ARMS
    ACCOMPANIED BY:
            LORETTA SYMMS, DEPUTY SERGEANT AT ARMS
            LARRY HARRIS, ADMINISTRATIVE ASSISTANT
            CHRISTOPHER DEY, CHIEF FINANCIAL OFFICER
            DUANE RAVENBERG, HEAD OF TELECOMMUNICATIONS

                           introduction of Associates

        Senator Bennett. We now go to the Sergeant at Arms' office,
    and I understand in the proper tradition of the modern Senate,
    the Sergeant at Arms has some charts. [Laughter.]
        Mr. Casey. You would expect nothing less, would you?
        Senator Bennett. We cannot have a debate on the floor of
    the Senate without a bunch of charts.
        Mr. Casey. I have some props too.
        Senator Bennett. OK, very good.
        For the record, Greg Casey is the Sergeant at Arms and he
    is accompanied by Ms. Loretta Symms, the Deputy Sergeant at
    Arms, and Mr. Larry Harris, the Administrative Assistant. Mr.
    Casey, we are happy to have you here and look forward to seeing
    your charts and watching your visual aids.
        Mr. Casey. I hope I do not disappoint you, Mr. Chairman,
    with the charts.
        I would like to introduce one other individual joining me
    at the table, the Chief Financial Officer for the Sergeant at
    Arms, Mr. Christopher Dey.
        Senator Bennett. Mr. Dey, we welcome you as well.

                               summary statement

        Mr. Casey. Thank you, Mr. Chairman. I am Greg Casey, the
    34th Sergeant at Arms and the Doorkeeper of the Senate, and it
    is an honor for me to be with you today. I am familiar with all
    the staff sitting along the back wall and compliment the
    chairman on having such competent individuals with him.
        Mr. Chairman, when the majority leader told me he was going
    to make me the Sergeant at Arms, he gave me a very clear two-
    part mandate. The first was to make sure that the financial
    operations of the Sergeant at Arms were properly run. The
    second was to look at the management functions to make sure
    that we could increase the service to the Senators in a cost-
    efficient manner.
        With the help of retired Senator Hank Brown, we put
    together a skilled evaluation team that built on an audit that
    was done of the Sergeant at Arms in 1994. The evaluation team
    concluded that we did, in fact, have the necessary financial
    tools in place to ensure that we are running in a proper
    fashion.
        That evaluation team also told us, however, that we needed
    to get on with the massive restructuring of the Sergeant at
    Arms' office.
        As part of the study for that evaluation team, I had this
    organizational chart prepared. This chart represents the
    current operations of the Sergeant at Arms. As you can see, it
    is a vertically oriented conglomerate of nonintegrated
    functions. This is not an organization. It is a group of
    organizations that have been strung together over the last 20
    years or so.
        In it, more than 25 separate managers reported directly to
    the Sergeant at Arms, and in this nominal chain of command, as
    many as 70 employees were not accounted for. Duplication of
    effort was common. Consistency in compensation, evaluation, and
    performance measurement did not exist. What little planning and
    communication existed between these various departments served
    only the interests of the individual units. There was little
    concern for the organization as a whole or for the Senate as a
    customer.
        In this format, Member offices were subjected to four
    separate inventories by four separate departments. Under this
    format, we had one SAA department developing a technology that
    was totally inconsistent with the technological standard being
    developed in another Sergeant at Arms' department.
        In this structure, printers are procured and maintained by
    the computer center, copiers procured and maintained by the
    service department, and fax machines procured and maintained by
    telecommunications. I am sure there are many in this room who
    have a single machine in their house that performs all three of
    those functions.
        I think it should be obvious that advances in technology
    and the passage of time have erased whatever reason we had to
    build this kind of a stovepipe structure.
        To improve our productivity, Mr. Chairman, we needed to do
    more than nibble at the edges of change in this organization.
    We needed to do some profound, systemic reengineering.
        Interestingly enough, this is not the first time that the
    Senate of the United States has come to exactly that same
    conclusion. This is the commission report on the operations of
    the Senate, 1976-77. It was an exhaustive study of how the
    Senate does business. Included in that is an extensive study of
    administrative operations, including our own.
        Here is the conclusion. ``The administrative structure of
    the Senate is antiquated, fragmented, and lacking clear lines
    of authority and responsibility.''
        Among its recommendations was that, ``The administration of
    the Senate services needs to be reorganized within a unified
    modern management structure with clear lines of authority and
    responsibility.''
        Unfortunately, the structure that was so maligned in this
    report 20 years ago is essentially the same structure I just
    showed you on the chart.
        Now, in 1995 the Senate Rules Committee contracted with
    Performance Engineering Corp. They gave them the charge to come
    back with a review of the Senate's information technology
    infrastructure. This is that report. In short they said--and I
    quote--``The Sergeant at Arms should develop a new
    organizational structure.'' The report gave us a list of things
    that we should probably pursue in order to implement that new
    organization. Unfortunately, that report went largely unheeded.
        Now, the need for changing the way we do business as a
    Government and a Senate is not new. Congress recently passed
    several laws that require Federal agencies to adopt strategic
    planning and performance measurements, such as the Clinger-
    Cohen Act, the CFO Act, the Government Performance and Results
    Act, among others.
        I even have a quote from Vice President Al Gore's
    ``National Performance Review'' talking about the need for
    dynamic change.
        There is also a great deal that we do in the Sergeant at
    Arms and the Senate as a whole, Mr. Chairman, that simply must
    be changed because the Congressional Accountability Act makes
    us change it.
        Mr. Chairman, I think it was clear from the get-go that the
    Sergeant at Arms' office needed to change the way we did
    business, and we are.
        Our vision for the future is this. I think you can see from
    this chart that we have really sort of changed our approach. In
    the organization that we are building, we focus on improved
    service quality, increased efficiency, maximum responsiveness
    to clearly identifiable customer bases within the confines of
    available resources. While this is still very much a work in
    progress, you can see that this is a totally different model--
    this is a horizontally integrated model--than the one that you
    just saw. We can focus on planning, product development
    delivery, customer service, and quality assurance. We do this
    with a Sergeant at Arms institutionwide approach rather than a
    unit-by-unit one, recognizing that we have a clearly
    identifiable customer base and that is who we need to serve.
        One of the differences between what we are creating and
    what we were before is that all of our engineers will be in the
    technical operations division, whereas now we have engineers
    spread all over our operation working on piecemeal bits of
    technological answers to problems that people bring to our
    attention. We are going to put our engineers in one place and
    say that your job is to develop a technological vision for the
    future of the Senate. That is what we are going to do there.
        Also, we have gathered together a centralized customer
    support program, and so for the first time, there will be one
    person who is going to be the central point of contact for
    every office in the Senate helping to develop answers to
    questions that Senate offices may have before they become
    problems. We are going to do that over here in the customer
    relations program.
        We have developed an office operations division. Anybody
    who works in an office knows it is very difficult to know who
    you call when you have a problem. We have all experienced that.
    Instead of trying to educate all the offices as to whom that
    may be, we are developing a 228-HELP line so that all you have
    to know is to call 228-HELP. When you get that line, we will be
    able to give you the answer that you need.
        Mr. Chairman, moving from where we are now, where we have
    been for two decades, to this new organization is going to be a
    challenge. We have started it step by step in a logical
    fashion. It is going to take us some time. The challenge is not
    only making the reorganization work, but that we are not going
    to be allowed to miss a step in performing those services under
    the old organization as we get there.
        I have some interesting statistics in how our workload has
    also gone up considerably that I will give you near the end of
    the presentation.
        Even so, I think we have taken some logical first steps,
    but there are far too many for me to go into them all here.
    Time does not allow us to do that unless, of course, you ask me
    to do that. But I would like to give you just a few examples.
        We have created a Capitol division, and within the Capitol
    division, which basically takes care of the Capitol and the
    historical functions of the Sergeant at Arms, we have the
    Doorkeeper. The Doorkeepers are one of the oldest parts of the
    Sergeant at Arms' operation. As it is one of the most
    historical changes to the Sergeant at Arms, we decided to start
    there in implementing our management philosophy.
        We reengineered their operations. We trained them. We set
    down some standards. We have invested in our Doorkeeper corps.
    As a result, we believe that we get a far more professional
    Doorkeeper corps providing far better service, and we have done
    this while also reducing the FTE's in the Doorkeepers by 20
    percent.
        As we proceed, we are going to analyze each element in the
    Sergeant at Arms' office in the same way, applying the same
    kind of management philosophy, analyzing each position and each
    responsibility as we go, hopefully, with similar results. We
    are going to find out that we are going to have to do things a
    lot better. We are also discovering that we are going to have
    to do things a lot differently.
        A case in point is long distance billing. We went before a
    bipartisan meeting of office managers, and they complained
    about the huge amount of paperwork that goes along with long
    distance billing. We did some investigating and found that we
    were spending $1 for every 90 cents we collected. It did not
    make a whole lot of sense, so we simply eliminated the charge-
    back provision.
        But I think nothing is more indicative of the kind of
    change we are talking about than what we are proposing to do
    with support for State offices. Currently we have an arbitrary
    set of numbers that restricts State offices to a particular
    square footage, along with some artificial barriers on the kind
    of equipment that you can use in those offices.
        Now, the Sergeant at Arms' office provides every State
    office that you have with furniture and equipment at no cost to
    those individual offices, whether you have 5 offices or 10
    offices. We are on the line to have to support those offices.
        That did not make any sense to us. In the age of increased
    communication, it makes sense that your offices and others are
    going to put more of their resources in their home States where
    both the services are delivered and where the voters are.
    Rather than trying to artificially restrict the expenses for
    those offices arbitrarily, which is 40 percent of our expense
    budget, providing for those State offices, we came up with the
    solution that we offered to the Rules Committee. The Rules
    Committee has granted permission for us to move ahead with
    developing the following program.
        We will give each Senator a budget, much the same as we do
    with the computer budget, and say that, you can do this how you
    see fit, allowing you to develop the kind of offices that you
    want, the kind that best meet your constituent philosophies. We
    believe in the long run this is not only going to be a better
    solution for the Senators, but it is going to be a better
    solution for the taxpayers as well.
        We also created a project management tracking system. This
    is the first time this has ever been used here in the Senate.
    What it gives you, the oversight committees, is the ability to
    look at the way we are spending money in the Sergeant at Arms'
    office, to know what the purpose is, to know how much money we
    have spent, and to know whether we are on target or not. It
    gives us, the managers, the same information so that we, at a
    glance, can know what we are doing, how we are doing it, and
    whether or not we are keeping up with where we are supposed to
    be. This good management practice has been incorporated into
    quarterly reports, the first of which your office should have
    already received.
        Now, the beauty of this is twofold. No. 1, this is going to
    give you a report on major expenditures, the projects and
    initiatives in the Sergeant at Arms' office, without regard to
    the organization. This particular project deals with enterprise
    management. It will be the same project in the new organization
    as it was in the old organization.
        Additionally, we think this is going to be important for us
    as we move away from product development into more project and
    contract management for the future.
        As I alluded to earlier, the human resource management part
    of the Sergeant at Arms' operation has not served the Senate
    very well. If we are to demand more from our employees, we must
    be prepared to provide our employees with the tools they need
    to improve and the incentives required to award that
    improvement.
        To that end, we have hired a top-notch human resource
    professional and we have begun an extensive management training
    program. We now have a standard system on pay outlines Sergeant
    at Arms-wide, something we did not have before. We just
    finished training 120 front-line managers in the Sergeant at
    Arms' operations on how to perform on a consistent basis our
    personnel evaluations, as well as ADA training and FMLA
    training.
        Yesterday we awarded a job classification and salary range
    study, much the same as what the Secretary's office had done
    last year.
        We have instituted an employee awards program and already
    presented five merit awards in the first 6 months of this year.
    We are planning other programs that will award performance and
    help us retain the kind of skilled and technical professionals
    we are going to need in the new millennium.
        Other near-term efforts include a career path program
    within the Sergeant at Arms' operations, family/friendly leave
    programs, and the institution of individual technical training.
        The recent flooding in the Midwest also highlighted some
    problems that we had. We need to be rapid and flexible in
    supporting affected Members' offices when they are faced with
    such disasters. We found that we not only needed to change our
    own regulations and the way we respond to Members' needs, but
    we had to get some changes made in Federal law. With your help
    and the help of Senator Dorgan, those technical corrections
    were in the disaster supplemental that got vetoed, but I am
    confident that those technical corrections will make it into
    law.
        Senator Bennett. I doubt that those were the reasons for
    the veto.
        Mr. Casey. Good, glad to hear that. [Laughter.]
        That makes me feel better.
        But I think the point there is that we need to be far more
    capable in our response to the needs of our Members, and I
    think what we have put together is a program to do just that.
        As the Senate's primary contracting officer, our General
    Counsel has implemented progressive contract management
    techniques. These have resulted in significant savings to the
    Senate and the taxpayer. This check is a check that we
    presented to the majority leader and Senator Warner in April.
    It basically represents our share or the taxpayers' share of
    the proceeds that came about from what is known as a
    gainsharing practice. This practice creates financial
    incentives for both the contractor and for the client to
    increase productivity. We received national attention and kudos
    from all across the country for our efforts in this area, and
    our General Counsel deserves congratulations for that effort.
    We hope this will be the first of many such aggressive contract
    renegotiations.
        We also did some renegotiations which I did not mention
    earlier with regard to telecommunications and our
    telecommunications department was able to generate significant
    savings there as well.

                                          OFFICE OF THE SERGEANT AT ARMS AND DOORKEEPER FISCAL YEAR 1998 BUDGET REQUEST
                                                             [In millions of dollars by fiscal year]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Current organization                              Proposed organization
                         Description                     ---------------------------------------------------------------------------------------------------
                                                            1997      1998      1999      2000      2001      1997      1998      1999      2000      2001
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Operations and maintenance..........................      95.3      95.2     102.6     106.1     109.3      95.3      95.2      95.2      95.2      95.2
    Capital expenditures................................       4.6      18.1      17.0      13.1      14.4       4.6      18.1      17.0      13.1      14.4
                                                         ---------------------------------------------------------------------------------------------------
          Total budget..................................      99.9     113.3     119.6     119.2     123.7      99.9     113.3     112.2     108.3     109.6
    --------------------------------------------------------------------------------------------------------------------------------------------------------

        Now, unfortunately, Mr. Chairman, the budget request which
    you have been given for fiscal year 1998 was prepared prior to
    the implementation of this reorganization. It neither reflects
    the cost savings we anticipate through better management, nor
    the organizational groupings under which we will soon be
    operating.
        Even so, we developed this budget last fall integrating our
    new operation philosophy. We divided our budget into operations
    and maintenance and strategic initiatives, or capital budget.
        Our prepared budget request for fiscal year 1998 is $113
    million, an increase of $13 million over 1997, or 13 percent.

        ----------------------------------------------------------------

           OFFICE OF THE SERGEANT AT ARMS AND DOORKEEPER FISCAL YEAR 1998 BUDGET REQUEST--CAPITAL EXPENDITURES
                                         [In millions of dollars by fiscal year]
    ----------------------------------------------------------------------------------------------------------------
                              Description                             1997      1998      1999      2000      2001
    ----------------------------------------------------------------------------------------------------------------
    Telecom infrastructure........................................  ........       2.0       4.0       2.8       2.4
    Telecom network upgrades......................................       1.7      11.0       7.2       6.5       8.5
    Year 2000 compliance..........................................  ........        .8       1.0        .4        .1
    Financial systems.............................................       1.3       1.5       2.0       1.0       1.1
    LEGIS reengineering...........................................       1.2       1.7       1.7       1.8       1.8
    Other.........................................................        .5       1.1       1.1        .6        .6
                                                                   -------------------------------------------------
          Total capital expenditures..............................       4.7      18.1      17.1      13.1      14.4
    ----------------------------------------------------------------------------------------------------------------

        ----------------------------------------------------------------

        Our ongoing operations and maintenance budget is
    essentially flat at $95 million. That reflects the nominal
    reduction in FTE's that we anticipated last fall when we began
    this reorganization. Virtually all of the increases are the
    result of easily identifiable capital expenditures for
    strategic initiatives, infrastructure, and capital
    improvements. They aggregate a total of $18 million in 1998, an
    increase of $13 million.
        As you can see, they are mainly in the area of telecom
    infrastructure, finishing up work in the Russell, and moving
    into the Dirksen Building, as well as wiring, and providing
    network telecoms for State office operations. This was
    identified as a need because we had a lot of offices whose
    systems were too slow, and I think you are probably aware of
    exactly what we are talking about.
        There is a series of longer-term options that we can go
    into, but you can see that it is clearly identifiable where
    that money is to be spent.
        In 1998 we have a request on salaries of $35.1 million.
    That is a 3-percent increase over 1997 and essentially reflects
    the cost of living.
        Now, Mr. Chairman, I will go out on a limb here. Had we
    been able to prepare our budget submission today and its
    outward projections subsequent to the completion of our
    reorganization, it would have reflected the reduction in FTE's
    and O&M which is now being realized. Even some of the increases
    in capital expenditures we believe would be moderated, as the
    ongoing information technology strategic planning in which we
    are now engaged adds a discipline to technological improvements
    that currently does not exist.
        It would have looked more like this, had we been able to
    prepare the chart. The difference is rather striking. In 2001,
    the budget we had originally prepared was $123.1 million. This
    one was $109.6 million.
        Now, obviously this is based on some preliminary
    information. We have to finish this kind of a budget analysis
    of the new organization when that organization is completed
    before we can submit that to you as the plan for where we
    really want to go.
        As indicated earlier, we were able to significantly reduce
    the FTE requirements for our doorkeeper operation by
    implementing some sound management philosophy. Although it is
    premature to forecast year-end figures right now, the Sergeant
    at Arms' organization is currently running 50 to 80 FTE's below
    what we had anticipated, and we are currently $3 to $5 million
    below projections on salaries.
        I would remind you that with some of these savings, we are
    going to ask for reprogramming which will be necessary to
    offset the deferred organizational infrastructure that I
    referenced earlier, in particular, the human resource aspects
    of it.
        Now, what this does not include or this organization does
    not include is the product of the ongoing strategic planning
    that is being led by the Rules Committee in conjunction with
    the Sergeant at Arms and the Secretary of the Senate. There
    will be probably some suggestions for major changes and some
    major cost shifts between these offices or inclusions that are
    not reflected here.
        Again, Mr. Chairman, I am honored to be here today. I am
    also very proud of the dedicated men and women who serve the
    Senate in the Office of the Sergeant at Arms. As you can see,
    we have embarked on a fairly aggressive program, and as we move
    forward to address these challenges, I could not ask for a
    finer group of people with which to work, and in that regard, I
    am truly blessed. I would like for them to raise their hands,
    my crew who are here.
        [A show of hands.]

                               prepared statement

        Mr. Casey. This is truly a fairly remarkable group of
    people, Mr. Chairman, and I am blessed to have them working
    with me.
        I look forward to working with you and Senator Dorgan, and
    I would be glad to answer any questions that you may have.
        [The statement follows:]
                  Prepared Statement of Hon. Gregory S. Casey
        Thank you Mr. Chairman. I'm Greg Casey. On six September of 1996,
    the Senate elected me the 34th Sergeant At Arms and Doorkeeper. It is
    an honor for me to appear before you today.
        Mr. Chairman, when the Majority Leader told me he was going to
    nominate me for this position, the Leader gave me a clear two part
    mandate. First, evaluate the financial operations to insure their
    propriety. Second, evaluate and manage the operations in such a way as
    to increase service to the Senate in the most efficient and productive
    manner possible.
        Retired United States Senator Hank Brown graciously agreed to help
    lead a skilled evaluation team to assist in this effort. Building on a
    General Accounting Office audit done in 1994, the team concluded in
    their January 1997 report: ``* * * we concur with the GAO and believe
    that the Sergeant at Arms financial operations have the necessary
    internal controls in place to insure proper financial management.''
        They also emphasized the critical need to begin strategic planning
    and reorganize and reengineer the operations of the Sergeant at Arms.
        As part of this evaluation, I had prepared this organizational
    chart of the current operations of the Sergeant At Arms. As you can
    see, it is a vertically oriented conglomerate of non-integrated
    functions.
        More than 25 separate managers report directly to the Sergeant At
    Arms and more than 70 employees worked outside this chain of command.
        Duplication of effort was common, consistency in compensation,
    evaluation and performance measurements was not.
        What little planning and communication existed between departments,
    served the interests of each unit and not the organization as a whole
    or its customers.
        In this format, member offices are subjected to four separate
    inventories by four separate departments; one each for
    telecommunications, computer and general office equipment and one for
    furniture.
        One SAA department was developing a product that was inconsistent
    with the technical operating standards being developed by another
    department.
        In this structure, printers are procured and maintained by the
    Computer Center, copiers by the Service Department, and fax machines by
    Telecommunications Department. At home I have one machine that can do
    all three things.
        Clearly, technology and time has erased the lines of distinction
    that existed in the creation of this stovepipe structure. To improve
    our productivity we need to do more than nibble at the edges of change,
    we need to make systemic changes in the way we do business.
        Interestingly, we found this wasn't the first time that conclusion
    had been reached. ``The Commission on the Operation of the Senate;
    1976-1977'' was an exhaustive review of Senate operations to include
    the administrative operations of the Sergeant At Arms itself. It found:

              ``The administrative structure of the Senate is antiquated,
            fragmented, and lacking in clear lines of authority and
            responsibility.
              Summary of Recommendations.--The administration of the Senate
            services should be reorganized within a unified modern
            management structure having clear lines of authority and
            responsibility.'' (Commission on the Operation of the Senate,
            1976-1977)

        Unfortunately, the organizational structure of the Sergeant at Arms
    maligned in this 20 year old report is essentially the same as the
    current structure I just described.
        In 1995, the Performance Engineering Corporation was contracted to
    perform a review of the Senate's Information Technology Infrastructure.
    They concluded that the ``Sergeant at Arms should develop a new
    organizational structure * * *'' and went on to suggest on how to
    proceed. That report went largely unheeded.
        The need for changing the way we do business is not new to
    government or the Senate. Congress recently required that all federal
    agencies adopt strategic planning, performance measurements, and employ
    best business practices in their operations. These laws include the
    Clinger-Cohen Act, the CFO Act, Government Performance and Results Act,
    among others.
        Quoting from Vice President Al Gore's ``National Performance
    Review'',

              ``The idea of reengineering * * * is critical. We don't want
            to automate the old, worn processes of government. Information
            Technology was and is the great enabler for reinvention. It
            allows us to rethink, in fundamental ways, how people work and
            how we serve our customers.''

        In addition Mr. Chairman, there is simply much that we do here that
    the Congressional Accountability Act requires us to change.
        Mr. Chairman, I think what must be done is clear. The Sergeant at
    Arms office must change the way it does business and we are. We are
    rethinking how we work and serve our customers, changing and improving
    outdated processes, implementing performance measurements for our
    employees, contractors and the organization as a whole.
        Our vision for the future organizational structure is this (chart).
    It is a single, integrated organization focused on improved service
    quality, increased efficiency and maximum responsiveness to customer
    needs within the limits of available resources.
        While this is still a ``work in progress'', you can see how
    different this model is. In this model, planning, product development
    and delivery, customer service and quality assurance are emphasized
    enterprise wide, not unit by unit.
        We've gathered the dispersed engineering resources into a single
    unit, focused not on piecemeal solutions to individual problems but on
    proactive long term, Senate wide technology solutions.
        For the first time, we'll have centralized customer support to
    provide each Senate office with one point of contact for all Sergeant
    at Arms services.
        We intend to provide one-stop ``228-HELP'' line for all services,
    similar to systems now in use by Fortune 100 companies. We are in the
    field as we speak identifying and evaluating such systems.
        Mr. Chairman, moving from the old to the new isn't going to happen
    overnight. In addition to the challenges of our reorganization, we
    still have to perform our ongoing operations. This requires that the
    timing of our reorganization effort be measured and thoughtful. One
    step at a time.
        Even so, we have already taken many steps forward.
        Within the nearly completed Capitol Division we've concentrated
    activities and services critical to the operations of the Capitol
    Building and Senate Floor. It's under the direct responsibility of the
    Deputy Sergeant at Arms, Loretta Symms.
        In this division you'll find the Doorkeepers, whose charge of
    maintaining order and decorum on the Senate floor is the most
    historical duty within my operation. It is here we have tested our
    management philosophy; planning, reorganizing and reengineering,
    training and investment. As a result, we believe we provide a higher
    level of more professional service with a twenty percent reduction in
    FTE's.
        As we proceed, we intend to analyze each and every service we
    provide applying similar best business practice techniques to increase
    productivity. This will not only involve doing what we do better but
    wholesale changes in the way we do business.
        One area where that becomes most obvious is in the support of
    member's state offices. As you know, approximately forty percent of the
    Sergeant At Arm's expense budget is spent in support of state offices
    and it goes up every year. Currently, state office support is based on
    a square footage allotments and some artificial restrictions on
    computers and office equipment.
        Now, although state operations are limited by square footage, the
    Sergeant at Arms provides each state office with furniture and
    equipment it may or may not need because it comes at no cost to the
    individual offices. It's wasteful and unresponsive.
        Instead of providing services under this confusing allocation
    scheme, the Rules Committee has granted our request to develop a new
    process that gives Senate offices the responsibility and flexibility to
    meet their own needs and constituent services philosophies. Under our
    new approach, each Senator will be provided a state office budget to be
    used as the individual Senator sees fit within broad guidelines. We
    think this will result in a more cost effective arrangement for both
    the members and the taxpayer.
        A bi-partisan group of office managers asked if anything could be
    done to reduce the paperwork associated with telecommunication billing.
    We found we were spending a dollar to collect ninety-five cents. We
    eliminated the charge back process.
        We will soon adopt the use of government Credit Cards for the
    procurement of small purchases, something the federal government has
    already adopted because it reduces administrative costs.
        We developed the Technology Review Panel to increase the
    communication and consistency in technical standards, and eliminate
    duplication and/or conflict of effort.
        We created a Project Management tracking system to give the
    oversight committees and us sound business information on the progress
    and status of our expenditures and operations. The first of these
    quarterly reports has already been submitted to the committee.
        The current report reflects our current structure and budget. As we
    proceed with our reorganization and strategic planning efforts, you
    will see changes in priorities and respective resources. However, the
    project reporting will allow the committee to be fully and regularly
    informed as to our progress. This will become more important as we
    moves toward more project and contract management and less internal
    product development.
        As mentioned earlier, Sergeant At Arms Human Resource Management
    has not served the Senate well. If we are to demand more from our
    employees, we must be prepared to provide them with the tools they need
    to improve and the incentives required to reward improvement.
        To that end, we have hired a top notch Human Resource professional
    and begun an extensive management training program. We have
    standardized a system wide pay outline and just finished training 120
    front line Sergeant At Arms managers on how to perform personnel
    evaluations.
        A job classification and salary range study contract is about to be
    awarded.
        We have instituted an employee awards programs and given away at
    least five merit awards in the first six months and have other programs
    that will reward performance and help us retain skilled technical
    professionals.
        Additional near term efforts include a career path program, more
    family friendly leave programs and individual technical training.
        The recent flooding in the Midwest highlighted the need for more
    rapid and flexible support to affected member's state office
    operations. We found we needed to change not only our internal
    regulations, but a federal statute delayed our ability to respond.
    Thanks to your leadership, Mr. Chairman, and the ranking member,
    Senator Dorgan, we were able to have a technical correction to the law
    included in the recent disaster supplemental.
        As the Senate's primary contracting officer, the General Council
    for the Sergeant At Arms has implemented progressive contract
    management techniques that resulted in substantial savings to the
    Senate and the taxpayer. This ``gain sharing'' practice creates
    financial incentives for both the contractor and the client to increase
    productivity and has received national attention. This check was
    presented to the Majority Leader and Senator Warner in April.
        Unfortunately, Mr. Chairman, the budget request for fiscal year
    1998 you are considering today was prepared prior to the reorganization
    we have been discussing. It neither reflects the cost savings we
    anticipate through better management nor the organizational groupings
    we will soon be operating under.
        Even so, Mr. Chairman, we developed this budget to reflect our new
    operational philosophy, dividing it into the categories of Operations
    and Maintenance and Strategic Initiatives.
        Our prepared budget request for fiscal year 1998 is $113 million,
    an increase of $13 million over 1997.
        Our ongoing O&M budget is flat, at $95 million. It also reflects
    the nominal reduction in FTE's we anticipated last fall would result
    from our reorganization effort. Virtually all of the increase is the
    result of easily identifiable capital expenditures for strategic
    initiatives, infrastructure and capital improvements, which aggregate
    $18 million in 1998, an increase of $13 million from 1997.
        The 1998 request of $35.1 million for salaries itself is a 3
    percent increase over the current year and essentially represents the
    cost-of-living increase.
        Mr. Chairman, had we been able to prepare this budget submission
    and its out year projections subsequent to the completion of our
    reorganization, it would have reflected the reduction in FTE's and O&M
    budget now being realized. Even some of the increases in the capital
    expenditures would be moderated as the ongoing Information technology
    strategic planning effort begins to introduce a discipline on
    technology improvements that currently does not exist.
        It would have looked more like this chart, which actually indicates
    reduced budgets in the out years. This is based on some very
    preliminary results from the reorganization to date.
        As indicated earlier, we were able to significantly reduce the FTE
    requirements of the Doorkeeper operation by implementing our management
    philosophy. Although it is premature to forecast year end figures at
    this point, the Sergeant At Arms organization is currently running 50
    to 80 FTE's below projection and $3 to $5 million below projection on
    salaries. Some of those savings, however, will be required to offset
    the deferred organizational infrastructure that needs to be rebuilt.
        Additionally, the Senate-wide strategic planning effort lead by the
    Rules and Administration Committee may also have an effect on our
    current year budget.
        Again, I am honored to appear before the committee and appreciate
    the time you have allowed. I am very proud of the dedicated men and
    women who serve the Senate in the Office of the Sergeant at Arms. As we
    move forward to address the staggering challenges that face us in the
    coming months, I could not ask for a finer group of people with which
    to be affiliated. In that, I am truly blessed.
        I look forward to working with you, Mr. Chairman, and Senator
    Dorgan, and look forward to your continued leadership and support.
        Mr. Chairman, this concludes my prepared statement and I would be
    happy to answer any questions the committee may have.
                                     ______

                  Biographical Sketch of Hon. Gregory S. Casey
        Gregory S. Casey was elected the 34th Sergeant at Arms and
    Doorkeeper of the United States Senate on September 6, 1996. As such,
    he is the chief law enforcement and protocol officer of the United
    States Senate, and the principal administrator of most of the support
    services provided to Senators and their staffs.
        Prior to his election as an officer of the Senate, he served six
    years as Chief of Staff for U.S. Senator Larry Craig of Idaho, where he
    managed every aspect of the Senator's operation in Washington, D.C.,
    and Idaho.
        Four years prior, Mr. Casey was the President and CEO of the Idaho
    Association of Commerce and Industry (IACI), an organization
    representing the business interests of more than 65 percent of the
    total commerce conducted in the state of Idaho. As IACI President, he
    was Idaho business' chief spokesman.
        During that time, he also served as an officer or member of the
    board of several organizations including the Idaho Council on Economic
    Education, The Idaho Foundation for Free Enterprise, The Boise Futures
    Foundation, Buy Idaho and Idaho Business Week and, in 1989, he was
    elected to the six member Executive Committee of the National Council
    of State Manufacturing Associations.
        From 1981 until 1986, Mr. Casey served on Congressman Larry Craig's
    Washington, D.C. staff, in positions ranging from Staff Assistant,
    Legislative Director, to Administrative Assistant and Chief of Staff.
    He was also active in various campaign organizations. During this
    period, he served as Vice President of the House Administrative
    Assistants Association and as Director of the Congressional Leaders
    United for a Balanced Budget (CLUBB) organization.
        Previous to joining Mr. Craig, he was Vice President and General
    Manager of Pioneer Title Company of Ada and Canyon Counties and prior
    to that, the Executive Vice President of the Homebuilders Association
    of South West Idaho. He has served on the board of directors for
    several civic organizations including the YMCA and The American Legion
    Boys State.
        Mr. Casey is a graduate of the University of Idaho with a degree in
    Political Science and has completed graduate programs in Legislative
    Affairs through the Library of Congress.
        Mr. Casey is a fifth generation Idaho native and is married to the
    former Julia Laky of Boise, Idaho. They have a son, Greg Junior.

                             Overlapping management

        Senator Bennett. Thank you very much, and I commend you on
    your presentation and, more importantly, on the tremendous
    amount of work that has gone on behind it and gone on in an
    effort to bring us to this point.
        I will make a general comment which you may want to respond
    to later, but will not have to here. Again, wearing my hat from
    the majority leader as chair of the task force to talk about
    ways in which the Senate can be made more efficient, I would
    like you to think about, if you have not already, those
    portions of overlapping management between the Sergeant at Arms
    and the Secretary of the Senate.
        I think we have two excellent officers in those positions,
    yourself as Sergeant at Arms and Mr. Sisco as Secretary of the
    Senate, and the traditional kinds of turf battles that one runs
    into and expects in the Federal Government probably can be
    minimized with the quality of leadership that you and Mr. Sisco
    provide.
        Have you ever sat down in a quiet room with him, put your
    feet on the ottoman, looked at the ceiling, and said, why are
    there two offices and where is a really clear line of
    demarcation? Because a lot of what you do I think he might do.
    A lot of what he does you might do. I think the two offices
    started out with no overlapping functions, and as they have
    grown over the centuries, overlapping functions have been
    created by the previous holders of these two offices who did
    fight turf battles.
        Mr. Casey. I have heard that. [Laughter.]
        Senator Bennett. As I say, I will not expect a detailed
    response from you now, but as you are going through your
    reinvention and reengineering activities, it must occur to you
    that there are some functions you might just spin off
    altogether in your organizational chart and say to Mr. Sisco,
    here, you can do this more efficiently than we can. There may
    be some things that he could spin off to you. Maybe at some
    future point, perhaps long after I am here, you who are both
    younger than I, might say there will just be a single office,
    whatever it is called, that provides all of the management and
    support for the Senate.
        Do you have any quick reaction to that? And if you do not,
    I will understand that, but I want to get you thinking in those
    terms.
        Mr. Casey. Anybody who has ever heard me talk about this
    before, I usually have a chapter in the book. Christine is over
    there laughing. She knows. I have a chapter in this book I can
    read you about that very thing, if you want.
        Senator Bennett. And I can read the book.
        Mr. Casey. The Secretary and I have sat in a room, not
    asking why the two of us are here. There are very distinct
    reasons there is a Secretary and there is a Sergeant at Arms
    and there are roles that these people should play. Over the
    years, as this book correctly points out, things have been
    added to both our jobs and not added in maybe as logical a
    fashion as it should.
        We have sat down with the Rules Committee and are engaged
    in a strategic planning process right now, and part of the
    questions that we are asking ourselves is should this go here
    or should this go there. So, it is an extremely difficult thing
    to sort through.
        But yes, Gary Sisco and the Rules Committee staff and I and
    also the Architect have had exactly those conversations.
        Senator Bennett. Yes; you have to include the Architect in
    that.
        Mr. Casey. We are having those conversations in the hopes
    that we can give you some solid things. In fact, I have tried
    to get Gary to take a couple things already. [Laughter.]
        So, we have already had those discussions and we will
    continue to have those discussions. I think you are absolutely
    right. There is a feeling that the two of us have that we are
    here in a short tenure and our job is to serve the institution
    and not to build our own empires. So, I am very confident we
    will be able to give you some good news, Mr. Chairman, while
    you are still the chairman.
        Senator Bennett. Thank you. I am confident I will be
    chairman for a little while.

                                Customer service

        A relatively minor item but it is always the minor items
    that rise up and bite you in terms of your customer service.
        Mr. Harris. He reminds us every day about that.
        Mr. Casey. I remind him every day of that.
        Senator Bennett. Where is the phone book?
        Mr. Ravenberg. Senator, the phone book is in the final
    stages of proofreading right now. There has been a tremendous
    amount of changes that occurred, as you well know, in the past
    year and that has caused us some delay. We expect to get that
    to GPO by the end of this week.
        Mr. Casey. Thank you, Mr. Chairman, for asking that
    question. [Laughter.]
        May I just emphasize, I have been asking exactly the same
    question.
        Senator Bennett. OK, well, in the overall scheme of what
    you put up on your chart here, it is a very minor item. In
    terms of the day-to-day operation----
        Mr. Casey. I learned from my friends in the police
    department, if you take care of the little things, the big
    things will take of themselves. We are sorry that it has taken
    us so long.
        Senator Bennett. Senators are used to having an interim
    phone book sometime in March, and I will not tell you how to do
    your business, but it might not be a bad idea for you to think
    about even a mimeographed copy, something, more quickly than
    the major phone book.
        Also on the list of minor things, but high visibility,
    particularly with some of our friends in the press, talk about
    the consolidation of the barber shop and the beauty salon and
    how much you think this will save and where it is.
        Mr. Casey. We asked the Rules Committee to allow us to
    proceed with a two-part program. Part one was to consolidate
    the two operations into one, to have that consolidated
    operation submit to us a plan that closed the gap between what
    they bring into the rollover funds and what they cost us in
    actual expenditure.
        I put together a task force to make that evaluation, hoping
    they would come back with a very clear one-two-three step
    process. The task force came back with a split decision.
        So, by the end of this month, I have asked the two managers
    in charge to put together a plan that consolidates those two
    operations and closes the gap. I want a fundamental glide path
    plan that closes the gap between what it costs us and what we
    have in those rollover funds, to include increasing prices if
    that is what is necessary, reducing staffing if that is what is
    necessary, doing advertising if that is what is necessary, or
    extending their hours. That should be to me by the end of this
    month.
        If we cannot come up with a plan that does that--and the
    Rules Committee has given me the OK--I will go back to the
    Rules Committee and ask to exercise the second alternative
    which would be to outsource.
        Senator Bennett. You may have discussed this in detail in
    your presentation, but let us highlight it. We understand you
    intend to request a transfer of $5 million from salaries to
    contingent expenses. Did you cover that?
        Mr. Casey. I do not know that I quantified the number that
    we will intend to transfer, but that is essentially correct.
        Senator Bennett. And that was to get increased flexibility
    into each individual Senator's office? That was part of that
    particular approach?
        Mr. Casey. No; I do not think we are going to ask for a
    transfer of funds for that.
        We are going to, hopefully, be able to convert some of the
    moneys that we are saving in our management into other
    infrastructure developments like some of our human resource
    programs. The other moneys that we are talking about on
    strategic initiatives are asked for in this budget here.
        Senator Bennett. So, the transfer----
        Mr. Casey. Would be from salaries to expenses.
        Senator Bennett. OK. Does this mean that in future years,
    the salary base will go down by $5 million?
        Mr. Casey. I believe we are going to be able to continue to
    see a reduction in the FTE's required to meet our operations.
    What we are finding is that we simply have redundancy in so
    many of our functions. I cannot tell you right now, Mr.
    Chairman, how far that is going to go down because we are
    implementing. At the same time we are reducing and analyzing
    the old ways of doing business, we are adding some new ones.
        I do not know how much the 228-HELP line is going to
    require. We have folks within our institution right now who do
    that, but they do it unit by unit. Can I save by bringing them
    together in one unit or is it going to require the same amount
    of personnel? So, I am not able to answer that question until
    we get this thing fully implemented.

                         Full-time equivalent positions

        Senator Bennett. Well, in fiscal year 1999, your FTE's
    start going back up again. They come down by six in fiscal year
    1998. In 1999 they go up a little bit. In 2000, well, you are
    kind of level in there.
        Mr. Casey. I do not believe our FTE's will go above 800.
        Senator Bennett. So, this is your best estimate but you are
    hoping to get to 800 and stay there.
        Mr. Casey. We are now probably at 775 or below.
        If you are asking me what I think is going to happen--and
    it looks like the trends are that way--our O&M will be flat,
    our FTE's will begin a gradual decline. Our infrastructure
    capital expenditures will spike in 1998 and 1999 and begin to
    level out. I believe with that spike that we put forward on our
    capital expenditures, I will be able to continue the O&M and
    the FTE trend line down.
        I believe that we are going to continue to see a decline in
    our FTE's and probably get down to around maybe 100 less than
    the FTE's we show on the chart. That is the difference between
    the chart I had to give you based on the old organization last
    fall and this new one that we are working on.
        I have not finished the total reorganization, so I cannot
    give you this kind of a book. When that is done, we will get
    that to you as soon as we can.
        Senator Bennett. Well, that, of course is every manager's
    dream of what happens with your capital expenditures, that you
    get a very substantial return on the investment later on in
    terms of a more efficient operation.
        Mr. Casey. We can point to where we have redundant services
    now as to where we can get a significant savings, but we have
    not implemented it yet. So, it is projection so far.
        Senator Bennett. Again, I commend you for what you are
    doing. This is the kind of presentation that I hear on those
    very rare occasions where I am allowed to return to my former
    life in private industry and have a management team come in and
    make a presentation to the board. This is a first-class effort.
        Mr. Casey. Thank you, sir.
        Senator Bennett. I commend you and all the happy people
    that accompany you. [Laughter.]
        Mr. Casey. Thank you, Mr. Chairman.
        Senator Bennett. If there are no further comments from any
    witness, I have no further questions. Thank you.
                            ARCHITECT OF THE CAPITOL

    STATEMENT OF ALAN M. HANTMAN, ARCHITECT OF THE CAPITOL
    ACCOMPANIED BY STUART PREGNALL, BUDGET OFFICER/DIRECTOR OF FINANCIAL
                SERVICES

                       opening remarks of Senator Bennett

        Senator Bennett. We will now hear from the final panel, the
    Honorable Alan Hantman, Architect of the Capitol. Our final
    panel this morning consists of the Honorable Alan Hantman,
    Architect of the Capitol, and Mr. Hantman is accompanied by
    Stuart Pregnall, the Budget Officer and Director of Financial
    Services, and others from the Architect of the Capitol, which
    we expect you, Mr. Hantman, to introduce if they are called
    upon.
        Not to be outdone by the Sergeant at Arms, Mr. Hantman is
    appropriately accompanied by charts and graphs. We appreciate
    your being here. This is the first time, we must note for the
    record, that Mr. Hantman has testified before this committee.
    We welcome you in that circumstance and look forward not only
    to hearing from you today but for a long time to come.
        We understand the Office of the Architect has been working
    on upgrading its financial management system. Mr. Pregnall,
    that is undoubtedly why you are here, to report on the progress
    of that. We, of course, have particular interests in
    projections of capital costs necessary to maintain the
    buildings which house Congress and congressional functions,
    even some functions that have been assigned to Congress for
    reasons that may be a little obscure this far from the time
    that it was actually done.
        So, Mr. Hantman, we again welcome you not only to the
    committee but to your office formally and look forward to your
    testimony.

                               summary statement

        Mr. Hantman. Thank you very much, Mr. Chairman, and good
    morning to you and all assembled.
        As you know, I officially assumed my duties on February 3,
    some 4 months ago, and as you can appreciate, the process of
    mastering the complexities of my new position might take a bit
    longer than that. But in these 4 months, my first priority has
    been preparing for this series of budget presentations. I
    forget if this is my seventh or eighth in the 4 months so far.
        As you are well aware and as I am learning, the role of the
    office is complex and multifaceted. It can fairly accurately be
    summarized by stating that the core mission of the AOC is to
    provide for the Congress, on a bicameral, nonpartisan basis,
    expertise and advice relating to preserving the physical
    environment and operating the infrastructure supporting the
    Congress. Implicit in this mission is to me the assumption that
    in providing this expertise and advice, that I am part of a
    congressional team that shares the same goals of preserving the
    physical environment and operating the infrastructure
    supporting the Congress in a responsible and cost-effective
    manner.
        I welcome the opportunity of working with the members of
    this committee, of discussing the issues at hand, and of
    developing solutions that serve the Congress well.
        As you know, the AOC appropriations request for the fiscal
    year 1998 was prepared under the stewardship of William Ensign.
    It is that budget request that I present to you today and I
    present it to you in the context of the first 5-year capital
    budget ever prepared by this agency. I fully concur with Mr.
    Ensign's statement that there is a need to provide the Congress
    with a 5-year capital improvement budget to assist the Congress
    in making the wisest and best informed financial judgments
    based on a formal evaluation of future cost implications and
    with the assurance that we have undertaken a rigorous
    examination of related needs.
        I applaud Mr. Ensign for having initiated the systematic,
    agencywide planning effort which has also included in-depth
    involvement of all of the agency's clients. On the Senate side,
    this included the Sergeant at Arms and the Secretary of the
    Senate.
        The projects included in this budget, therefore, include
    all the needs that have been identified to date. I have
    evaluated these needs, reviewed the priority levels assigned to
    them, and assessed their budgetary implications.
        Before I address the budget, however, it might be helpful
    if I shared some of my thoughts and findings to date regarding
    this agency and its performance as I currently see it.

                        Condition of the physical plant

        With respect to the quality and condition of the physical
    plant, for a facility that is as heavily used as the Capitol,
    for a complex of older buildings such as this, it is in
    surprisingly good shape. The condition of the physical plant is
    directly tied to the institutional knowledge, the skill levels,
    and the dedication of the work force. This is a major reason
    that significant segments of our infrastructure have held up
    this well, despite having outlived its normal life expectancy.
    It has been patched and repatched and held together until there
    is finally material failure.
        We have a little show and tell over here. If you just pick
    up that finial over there. This is from the Library of
    Congress. We are still doing work, as you can see from the
    scaffolding up on the Library of Congress. This indicates that
    our sheet metal workers have been up there on many occasions
    patching and repatching, sealing and resealing, until finally
    the joints are giving way and there is just no way to support
    the integrity of any of these decorative or waterproofing
    pieces.
        We have many other pieces in our little box of show and
    tell over there. There is a section of copper which is really
    the status of the existing roof. Again, it shows the
    deterioration of the material itself which over time has been
    patched and repatched. The sealant is no longer holding. In
    fact, that is why we are redoing the entire dome.
        We have situations like this throughout the Capitol,
    including the Capitol dome itself.
        This, as you can see, is a pipe. We have lots of these
    throughout the Capitol, pipes that are totally occluded, very
    little room to go through, rusting out in major pieces. We have
    vent lines and drain lines that are totally sealed and not
    functioning at all throughout all of our major buildings.
        This, believe it or not, sir, is what is left of a valve,
    totally gone. It used to look something like this, but over
    time--we talked about water just before the session started--
    the chlorine and the minerals in the water in Washington, DC,
    tend to leach out zinc and other minerals and metals. It causes
    premature failure of sprinkler heads and lots of systems
    throughout the Capitol. So, we really have to look at ways to
    try to preclean the water, make sure this does not happen
    again, and constantly monitor elements that, in fact, should
    have much longer life expectancies than they do here on Capitol
    Hill.
        We have a team of sheet metal workers working on the
    Capitol roof, patching as necessary. Many other systems have
    outlived their useful life, have been patched up, and now
    require replacement. Good maintenance alone cannot solve these
    problems.

                       training needs of AOC supervisors

        As far as staff supervision is concerned, there are many
    aspects to this. Projects get done and in most instances they
    seem to get done well. But too many supervisors and foremen
    have little or no supervisory training, and they have
    difficulty working effectively with their subordinates. Much
    training needs to be done in this area.

                       Construction management employees

        An issue that also needs to be resolved is the temporary
    employees in our construction management division. They have
    been temporary for 10 or 20 years right now. There are some
    very capable people there and their status needs to be
    resolved. I will be coming back to you at a later date with
    further thoughts on this and other issues.

                              AOC management needs

        As far as management systems are concerned, they are not at
    all uniform across the campus, nor are they as professional as
    they need to be. Existing policies and procedures need to be
    reexamined and standardized. The human resources department has
    deteriorated over the last several years, along with our
    piping. It has been a major source of discontent for AOC
    employees.
        A new human resources director, Hector Suarez, who is with
    us here today was hired 2 months ago. Hector, are you here? OK.
        He is determining how best to rebuild the department and
    bring it into the 21st century and he will be filling several
    HR vacancies we currently have with strong and needed additions
    to the department.

                         Outsourcing and privatization

        With respect to outsourcing and privatization, this issue
    is wound up with the status of changes that have already been
    made or are currently contemplated, as well as with other
    outstanding issues that have yet to be resolved. I have no
    interest in continuing past policies and procedures that
    negatively impact the performance of this agency.
        That is why I have taken a show-me attitude toward the
    Arthur Andersen study that was completed in the last quarter of
    1996. Arthur Andersen was commissioned to develop a methodology
    to enable the AOC to calculate in-house costs and consider
    qualitative factors such as unique workplace characteristics,
    compare this information equitably with the private sector.
    They then analyzed the results of this comparative methodology
    and provided the AOC with recommendations on whether to
    privatize or reengineer various segments of its function.
        But the Arthur Andersen study is just one piece of the AOC
    equation, and as such it needs to become part of an overall
    strategic plan for the future of this agency rather than as a
    blueprint in and of itself.
        In the past 4 months, I have had interviews with many
    people. I have met one on one with approximately 40 of the key
    people in the agency, had group meetings with virtually all AOC
    employees, including shop workers, Power Plant employees,
    restaurant workers, night custodial employees, operating
    engineers, and so on. I brought two people with me to these
    group meetings: Art McIntye, our Inspector General, to deal
    with issues of fraud, waste, and abuse, and Kathy Gause, our
    EEO Director, to deal with issues concerning the Compliance
    Board and fair labor practices. Both of these people are
    generally well trusted by our employees.
        We often met first with line workers and then separately
    with the supervisory staff so that neither group would be
    inhibited in sharing their perspectives on how we could work
    more effectively on problem areas in general and in opening a
    dialog with management.
        I often found the level of frustration and discontent to be
    high. Employees have been in limbo for more than 2 years, ever
    since George White retired and when he was ill before that, and
    they are very concerned about privatization issues.
        I learned much from this series of meetings. This
    information, when coupled with the Arthur Andersen report,
    provides two major elements of the information necessary to
    allow this agency to make informed decisions and
    recommendations.
        The third component will be provided directly by AOC
    customers. We are reaching out to a cross section of Members of
    Congress and their staffs who interact with AOC employees to
    ask how we are doing on a wide range of interface areas, to ask
    if the level of service needs to be improved, or if, in fact,
    we can live with vacuuming carpets and dusting every other day
    instead of every day, or if we can save money on the scope of
    services that we are currently providing, whether they should
    be provided internally or by outside contractors, what security
    concerns might there be. All of these issues need to be
    addressed and understood from our clients' perspective.

                   AOC and Sergeants at Arms responsibilities

        We are also meeting with both the Sergeants at Arms to
    review the services we each provide to see if there can be some
    consolidation of overlapping responsibilities. There is
    confusion on what does respond and report to the Sergeants at
    Arms or to the AOC, for instance, with respect to cleaning. The
    Sergeant at Arms cleans the Senate portion of the Capitol
    Building. The AOC cleans the rest of the Capitol Building and
    all of the Senate office buildings. Does this make sense? Do we
    need to consolidate?

                             AOC consolidation plan

        We are also investigating the possible centralization of
    shop staff used by each major superintendent's jurisdiction. We
    intend to leave day-to-day quick response capabilities with
    each superintendent, but perhaps preventative maintenance
    forces might be centralized or privatized if that is found to
    be effective and efficient.
        Our goal is to reshape this agency to become as efficient
    as possible while still providing a level of service required
    by our customers and at levels that are appropriate to the
    Capitol. We are currently in transition and union issues may
    impact how we operate going forward.

                              AOC project request

        The above, Mr. Chairman, was all background to the critical
    issue of the 1998 budget. My overall assessment is that that
    budget prepared by my predecessor is basically valid. I have
    examined each of the 132 projects with the responsible
    designers and consultants. A file has been prepared on each to
    justify the need and the priority, and these are some of the
    examples of them. Some we have talked about already such as the
    Dirksen renovation, the $34 million project, and the rationale
    and the necessity for it. We have an entire report in here, and
    as we talked about on our walk-through, the necessity for that
    project.
        There is a project on plumbing renovations in the Capitol
    Building, some photographs of piping in the Capitol Building on
    the Senate side and the condition that it currently is in.
    Clearly if we find sections like that, we replace it, but we
    have an ongoing budget that needs to address these type of
    issues. So, $400,000 on an annual basis going forward for a
    total of some $2 million is what we are estimating at this
    point for that project.
        Other projects, minor ones. Replace the fire pump in the
    Russell Senate Office Building. It is a wonderful looking piece
    of equipment, but it no longer provides the power to deal with
    the sprinkler systems and the fire standpipe systems that we
    need. The pressure cannot be developed in this. So, that is a
    $75,000 piece of work.
        We have a carton back here with every one of the 132
    projects. We can review each of them with anybody who would
    care to do so.
        This is the Senate call system. It has diodes and tubes and
    things that are clearly outdated. They no longer respond. You
    cannot get replacement parts for them any longer. So, we are
    looking for design money to be able to look at alternative
    systems and develop a full budget for ultimate replacement of
    those systems.
        We could go on and on. Here is deterioration of the Capitol
    itself, columns that are deteriorating on the west front. We
    are requesting funding to take a look at the deterioration and
    what we need to do on the columns, the column capitals, in the
    Capitol Building itself and other buildings.
        The issue here is a good part of our budget really deals
    with studies and design issues that we want to get into so that
    we can come back to you more intelligently and say, OK, these
    are our studies, these are the results, this is what we want to
    do as a result of those studies, and these are the real dollars
    that we need going forward.
        Since it would be helpful if the individual budget numbers
    that we are presenting to you were understood in the context of
    past and projected future budgets, I prepared a series of
    charts to help illustrate these relationships. I believe they
    are important because they deal not only with the proposed 1998
    budget, but also with the budget pattern of the last 5 years
    and the 5-year master plan as well. If I may direct your
    attention to the charts, Jack Boertlein, our assistant in the
    budget department, will assist in the presentation.

                     Operating budget and capital projects

        The first chart has two components to it. Operations is
    shown in blue and capital projects are shown in red. Please
    note that the operating budget has held fairly steady since
    1993. It went from $137 million in 1993 to $148 million in 1995
    to a requested $147 million for 1998. Increasing utility costs
    are a part of this. Mandated raises are also part of this. The
    growth over time--COLA increases and raises and all have been
    absorbed basically by decreases in staff sizes and other
    efficiencies.
        The 1998 operating budget represents a 6-percent increase
    over 1997 and it is a worst case scenario. Clearly our mandate
    is to explore ways to achieve greater efficiencies through
    appropriate means such as privatizing, outsourcing,
    consolidating, achieving better utility rates, et cetera. The
    operating budget will be decreasing as we bring these
    recommendations to you through the year.
        The capital budget in red has, however, been steadily
    decreasing, from $32.8 million in 1993 to $27.9 million in
    1995, to one-half that amount or $14.4 million in 1997. In my
    view this is no way to effectively preserve an aging
    infrastructure such as ours.
        In 1998, the first year of the 5-year plan, it proposes an
    increase to $54 million. I have examined the appropriateness
    and priority of many of these projects, made some
    modifications, and reprioritized them as we just discussed, but
    let us discuss the breakdown of this 1998 budget itself.
        The next chart shows two main categories: operating on the
    left and capital costs on the right. Operating costs represent
    73 percent of the budget, 46 percent of that for pay and
    benefits. We will be evaluating those, as I indicated, going
    forward.
        Utilities make up 15 percent of the budget, and we believe
    there are savings there as well, including administrative
    measures such as suggesting to people they shut lights off when
    they leave the room.
        The capital budget represents 27 percent and it is divided
    into client-initiated projects, AOC-initiated projects, and
    cyclical maintenance projects. I will talk more about this in a
    moment.
        The next chart that we have here illustrates the 16 percent
    FTE staff reduction over the last 5 years, from 2,407 people in
    1992 to 2,034 FTE's in 1997. This again is a worst case
    scenario for 1997-98. I do not yet have a complete answer to
    whether the 16-percent reduction indicates that there was a lot
    of fat in the agency--and there may still be more fat to cut--
    or whether the agency is as lean and mean as it really can be
    at this point in time. I am working with my managers to analyze
    their current staffing levels with an eye toward achieving
    greater efficiencies.
        As a point of information, cuts in many other Federal
    agencies over the same time period have been below the 16-
    percent level that we have achieved to date.

                          Cyclical reinvestment budget

        Let us go back to the capital budget, if we can. The green
    bars represent the level of cyclical reinvestment as a part of
    the overall capital budget. The yellow represents new
    facilities, new projects. Here you can clearly see the pattern
    of actual decreasing reinvestment in our buildings and
    infrastructure from 1993 through 1997, and the proposed
    increases from 1998 onward. You can also clearly see the
    magnitude of new projects in the master plan shown in yellow.
    Many of these projects are related to the Library of Congress
    and their proposed facilities out at Fort Meade, or film
    storage, things of that nature.
        It is reasonable to ask how does anyone know how much to
    reinvest in a complex such as ours. We can clearly look project
    by project to see what needs to be done, each project approved
    on its own merits, and that is clearly what we intend to do.
    But what is a reasonable benchmark to measure total budgets
    against?
        The next chart attempts to show this, to put it in some
    kind of a perspective.
        Back in 1991-92, three university campuses were contacted
    to discuss their cyclical reinvestment budgets. Basically we
    have a campus here. What type of complex of buildings is more
    appropriate for us to benchmark against? The campuses were in
    Illinois, Michigan, and Stanford. They average 1.7 percent of
    the value of their buildings and infrastructure each year, the
    replacement value basically. The replacement value for our
    Capitol complex of some 13 million square feet was estimated at
    that time to exceed $3 billion. At 1.7 percent per year, that
    would be over $50 million in an annual reinvestment.
        Another check on this 1.7 percent is the IRS depreciation
    allowance for commercial properties. They currently allow 40
    years for full properties. That would imply a 2.5-percent per
    year depreciation level, or conversely a reinvestment. Clearly
    for equipment, they allow 15 years, which is certainly less
    than the 40-year building depreciation as well.
        What this graph attempts to do is plot a $50 million annual
    investment level in blue--and that is accelerated at 3 percent
    escalation per year--and measure that against the 1993 to 1997
    actual reinvestment costs that we have spent, showing $14.4
    million in 1997 as the low point. The dotted red line plots the
    proposed reinvestment portion of the 5-year master plan with
    $54 million in 1998 and goes on from there.
        Clearly what we see is if the $50 million is anywhere close
    to correct, over the last 5 years, we should have invested $250
    million in our infrastructure. We basically invested $100
    million and are digging ourselves into a hole which the next
    few years, hopefully, will help solve and realistically relate
    to.
        The following chart lists additional corroborating
    benchmarks related to this 1.7 number. The top of the chart,
    our current replacement value in 1997-98 is $3.6 billion. The
    first benchmark relates to the 1.7 percent we discussed. Army
    Corps of Engineers talks about 1.75 percent as a budget
    objective. University Federal research cost recovery, the OMB
    A-21, calls for a 2-percent replacement value or reinvestment.
    Conservative commercial depreciation we talked about at 40
    years, 2.5 percent. National Research Council of the Academy of
    Sciences has a low of 1.5 and a high of 3 percent. Our 1998
    proposed budget numbers relate to 1.4 percent of the estimated
    replacement value at this point in time.

                       Capitol complex replacement value

        Senator Bennett. Let me interrupt you----
        Mr. Hantman. Please.
        Senator Bennett [continuing]. And I apologize for that--
    long enough to ask how you calculated the replacement value. Is
    that on a per square foot basis?
        Mr. Hantman. We took the actual construction costs of each
    building, each component of Capitol Hill, and brought it
    forward--what is it--CPI--we used?
        Mr. Pregnall. We used the Consumer Price Index for those
    projects that began before the building construction cost index
    was established. I think the BCI was established in the early
    1900's. Before that time we used the CPI.
        Senator Bennett. But you did not say x number of square
    feet at current building costs of so much per square foot----
        Mr. Pregnall. No; we did not.
        Senator Bennett [continuing]. And it would cost us to
    replace this in the market x amount.
        Mr. Hantman. We did not do that. Clearly we are talking
    about unique individual buildings here.
        Senator Bennett. I understand that, but how difficult would
    it be to make that calculation simply as a ballpark----
        Mr. Hantman. If we wanted to take 13 million square feet
    and take current costs of commercial office buildings--it
    certainly would not be the quality of what we are talking
    about.

                     benchmark for Monumental construction

        Senator Bennett. You could not replace it with that kind of
    construction. The citizenry would not allow it. But there is, I
    am sure, a benchmark for monumental construction. Maybe the
    Ronald Reagan Building is considered monumental construction.
        Mr. Hantman. This is true.
        Mr. Pregnall. The difficulty with that type calculation is
    that does not take into consideration architectural and
    artistic finishes such as you have in this room. How would you
    calculate the cost of recreating this room? That would not be
    included in a square foot cost calculation.
        Mr. Hantman. We could look at the Ronald Reagan Building
    and see what those costs were and talk about 13 million square
    feet.
        Senator Bennett. I think the committee would be well served
    by having a ballpark understanding of what it would be, and
    understand that we are sophisticated enough to realize that we
    are not talking about putting up an IBM headquarters on this
    campus. Again, the citizenry would demand that the National
    Capitol, if it were to be replaced, would be replaced in a
    monumental form and the cost of doing that would clearly be
    higher than the cost of an ordinary office building no matter
    how nice. But $3.6 billion is a big enough figure that I think
    you ought to have some justification for it other than just the
    one benchmark method of arriving at it.
        Mr. Hantman. Fine. We will get back to you on that then,
    Mr. Chairman.
        Senator Bennett. Thank you. I apologize for interrupting.
        Mr. Hantman. No problem. No problem at all.
        As a point of information, several weeks ago we had a
    contingent from Australia come in, basically the folks who
    built, designed, and run their Federal office buildings in
    Canberra, less than 10 years old. They allocate on a flat sum
    basis 1 percent of replacement value even for a building
    complex that young. That is just a normal appropriation on an
    annual basis.

                          Cyclical maintenance project

        Perhaps the next chart. This pie chart shows the 1998
    cyclical maintenance projects in red. It shows $21 million for
    some 57 projects. This includes restoration of the Senate
    legislative garage, plumbing renovations for the Russell
    Building, repair of failed waterproofing over ST-71,
    rehabilitation of the Capitol dome. It also includes the USBG
    Conservatory, the $8 million, in that number right now.
        The AOC-initiated improvements are in green, and they
    amount to some $24 million for 50 projects. That includes ADA
    requirements, HVAC, electrical, telecom, sprinkler renovations
    in the Dirksen Building, electrical telecom systems in the
    Russell Building as examples.
        The blue indicates client-initiated projects, some 23 of
    them for $6.9 million. Infrastructure for security
    installations, mail room renovations in the Dirksen Building,
    centralized control room in the Senate recording studio, et
    cetera.
        Senator Bennett. When you say client-initiated, you mean--
    --
        Mr. Hantman. Others have asked us to do that.
        Senator Bennett [continuing]. The Secretary of the Senate
    and the Sergeant at Arms?
        Mr. Hantman. Yes, Mr. Chairman, that is correct.
        Senator Bennett. Thank you.
        Mr. Hantman. Now, for our clients' new projects, the yellow
    over there, these are also requested by clients, but these are
    new as opposed to renovation or restoration projects. The K-9
    facility at D.C. Village, copyright deposit facility at Fort
    Meade, et cetera.

                             Reprioritized projects

        One thing that I have done to Mr. Ensign's breakdown, which
    is indicated by this pie chart, is to reprioritize them. I
    think the next chart clearly indicates the way we restudied
    this bundle of projects, starting with life safety up at the
    top at 12 percent of the budget. These are projects related to
    fire protection, air quality, employee, and visitor safety. It
    includes installation of sprinkler systems, fire pump upgrades,
    chiller plant replacement, things of that nature. If we only
    got $6.2 million those would be the projects we would put it
    toward.
        The next two headings we might switch. ADA could come next
    or security could come next, either way. The projects under ADA
    are related to improvements of building and facility access for
    the handicaped, restroom modifications, elimination of
    barriers, some $2 million, or 4 percent of the budget.
        Security has 11 projects, $3.5 million. Projects related to
    the protection of Members, staff, visitors, and property,
    replacement of the north and south drive delta barriers on the
    Capitol Grounds, replacement of the security planters, Library
    of Congress upgrade of security systems, things of this nature
    are in that security category.
        The next major category represents 27 percent of the
    budget. This is cyclical maintenance, eight projects at $14.4
    million. These include projects that will increase building
    system functionality while replacing deteriorated or outdated
    systems. These include electrical and telecommunication system
    renovations in the Cannon Building, replacement of legislative
    call system and clocks throughout the complex, sound system
    replacements, committee and hearing rooms. I think Cannon is on
    the other side of the complex. We are talking about Russell
    here.
        Botanic Garden Conservatory is shown here also, some $8
    million or so for that complex.
        Cyclical maintenance is the rest, 22 percent of it, some 49
    projects at $12 million. Now, cyclical maintenance projects are
    those that will replace deteriorated or outdated systems with
    no significant increase in functionality. This is your pointing
    and caulking of facades. It is changing roofs, nothing
    improves. It is just the basic core needs. The Capitol dome is
    a part of that, garage floor repairs. It does not gain us
    anything, but they are things that need to be done.
        Let me review the other categories fairly quickly.
    Technology management systems provide the AOC with more
    efficient and effective operations. This includes computer-
    aided facility management, integrated management system we will
    be talking about, implementation of AOC-net, CAD data base, et
    cetera.
        The next is improvement projects for the AOC, some $1.2
    million, installation of lighting systems, extend the chilled
    water lines to the Conservatory, rotunda lighting upgrade,
    things of that nature.
        And the last is some $4.3 million for client improvements,
    conceptional facilities master plan for the police, completion
    of the K-9 facility, screening/holding facility, et cetera.
        So, this kind of breaks it down, and the next chart just
    summarizes that, talking about the total AOC budget in the
    bottom chart of some $43 million versus the $53 million dealing
    only with Senate and joint activities.

                         Five-year capital budget plan

        If I could move on to our last chart, it shows the 5-year
    capital budget. Now, this last chart plots the breakdown of
    cyclical and new projects for the 5-year master plan. It shows
    cyclical maintenance in blue, AOC new projects in yellow, and
    client projects in green.
        Senator Bennett. If I may, the cyclical maintenance is both
    improvement and stability maintenance.
        Mr. Hantman. Basically yes.
        Senator Bennett. In your previous chart you had those
    divided but those two numbers are joined for the blue number
    here. Is that correct?
        Mr. Hantman. Well, we have new projects over here.
        Senator Bennett. Go back to your pie chart.
        Mr. Hantman. OK.
        Senator Bennett. This is what I am trying to correlate. You
    have got improvement cyclical maintenance at 27 percent on the
    pie chart, and cyclical maintenance at 22 percent.
        Mr. Hantman. Correct.
        Senator Bennett. Those two numbers are combined in the blue
    bar on the bar chart. Is that correct?
        Mr. Hantman. That is correct.
        Senator Bennett. OK, that is all I wanted to clarify.
        Mr. Hantman. I have reviewed these projects in depth, I
    validated their need, and I have reprioritized as we have
    discussed.
        There will continue to be changes over the 5-year period,
    including schedule shifts, adjustments to reflect some of the
    concerns raised by members of this committee, possible changes
    that may come out of meetings with the Sergeant at Arms, the
    Secretary of the Senate as we review areas of responsibility
    and possible overlaps in service. The 5-year capital budget
    will be reviewed, revised, and updated each year to allow the
    Congress to maintain a broad overview of ongoing needs.

                                 Visitor center

        Outside the scope of this budget, of course, is a project
    called the visitor center project which is proposed to be built
    with private funds. There are no dollars in our budget for that
    at this point in time.
        I have met with the design team. We have begun reviewing
    the scope of the center and the functions proposed within.
    Reviewing the nature of the exhibits that might potentially be
    designed is really the critical path in any visitor center
    project. A group of 30 to 35 or so from both Houses of Congress
    visited the Newseum a couple of weeks back. I think it is in
    Arlington.
        Senator Bennett. Yes.
        Mr. Hantman. What we found, from talking with the people
    who ran that project, the people who designed the exhibits,
    that of the $48 million cost for the total project, one-half
    was for capital projects. The other one-half, some $24 or $25
    million, was for the exhibits themselves. That turned out to be
    the critical path that took them some 4 or 5 years to resolve.
        The wealth of information that we have to draw on that will
    describe our democratic processes, going back to the foundation
    of our Nation, is mind-boggling. The concept of winnowing that
    down to something that everybody can agree on that deserves to
    be in a confined space and be shown to the public and be
    accessible to the public is going to be a real challenge. I see
    that as being the critical path. Certainly the Sergeant at Arms
    and the Secretary of the Senate have offered and are very much
    involved in this process as well.

                               prepared statement

        That is pretty much the presentation, Mr. Chairman. I would
    welcome any questions. We can review in detail individual
    projects, total projects, where we are going, or any specific
    issues you might want to raise.
        [The statement follows:]
                     Prepared Statement of Alan M. Hantman
        Mr. Chairman, I am Alan Hantman, Architect of the Capitol. Under
    provisions of Public Law 101-163, enacted November 21, 1989, I was
    named the primary candidate of three candidates sent to the President
    for consideration by the bipartisan, bicameral Architect of the Capitol
    search commission. I have been greatly honored by the faith the
    commission placed in me through their recommendation, by the
    President's formal nomination, and by the subsequent confirmation by
    the Senate. I officially assumed my duties on February 3rd of this
    year. As you can appreciate, the process of mastering the complexities
    of my new position will take a little time. In this process, however,
    one of my first priorities has been reviewing the fiscal year 1998
    budget which was prepared by my predecessor.
               role of the office of the architect of the capitol
        Mr. Chairman, I would like to take a brief moment to describe
    broadly the present role of the agency. The Office of the Architect of
    the Capitol (AOC) is the agency responsible for the structural and
    mechanical care, maintenance, cleaning, and operation of the buildings
    and facilities supporting the Congress, including the Capitol Power
    Plant. This responsibility extends to the Botanic Garden, the
    structural and mechanical care and maintenance of the Library of
    Congress Buildings and grounds, as well as the Supreme Court Building
    and grounds. The office also undertakes the design and construction of
    new facilities and alteration of existing facilities.
        The core mission of the AOC is to provide for the Congress, on a
    bicameral and non-partisan basis, expertise and advice relating to
    preserving the physical environment and operating the infrastructure
    supporting the Congress. In so doing, the AOC utilizes staff and
    consultant architectural, engineering and professional expertise to
    provide the Congress with appropriate, timely and cost effective
    recommendations. The AOC also manages trade and service personnel who
    are charged with ensuring that the building systems operate efficiently
    and reliably in support of Congressional activities. The AOC also
    administers a wide variety of contracts for building and design
    services.
        Critical to achieving this mission is the institutional knowledge
    that has accrued in the agency. The value of the long term role of the
    Architect as an advocate for the physical environment was recognized by
    the Congress when it established a ten year renewable term for the
    Architect. Such an advocacy role is no less appropriate for the core
    professional and trades staff. The merit of maintaining a long-term
    view for preserving and protecting the historical environment is self-
    evident. To the credit of the agency, Congressional activities have
    never been interrupted by failure of any major building system.
        It goes without saying that many of the Congressional buildings are
    national treasures and require intimate knowledge and significant
    forethought for their preservation. The U.S. Capitol, which is ``the
    people's building,'' for example, is a unique combination of National
    capitol, museum, office building, meeting center, ceremonial site, and
    tourist attraction. The building's systems are required to support all
    of these activities, and its architectural design, decorative arts and
    historical significance must all be carefully considered before
    undertaking any work or implementing any changes to the building.
        Another benefit of the neutral, bicameral role of the AOC is the
    ability to provide technical and professional coordination in
    connection with ``joint'' activities. Over the years, the role of the
    office has broadened as a result. There are now functions and
    activities, such as the shuttle service and telecommunications, as well
    as Inaugural and Rotunda ceremonies, conducted or supported by the AOC,
    that are often not recognized as being within the scope of the office's
    professional, architectural and engineering roles, yet the Congress has
    acknowledged the merit of the AOC's neutral, bicameral coordination
    capacity.
        For over 200 years, an officer discharging the role of the
    Architect of the Capitol has provided to the Congress credible
    expertise on these matters. During this time, the ongoing and ever-
    changing institution of the Congress has been served by an agency that
    has responded to changing Congressional needs.
        Mr. Chairman, I wish to assure you that I am reviewing our
    operations and will be preparing suggestions for improving service
    delivery, quality responsiveness to the Congress, and cost
    effectiveness. During this process, I will involve the Superintendents
    of the Senate Office Buildings and the Capitol Building as their roles
    and functions pertain to supporting the needs of the Senate. If this
    means proposing changes in the role of the agency or how it relates to
    other Congressional entities, I will bring these suggestions to the
    appropriate oversight bodies for consideration. I will of course keep
    this Subcommittee informed of any suggestions that may affect Senate
    funding and operations.
            background information--fiscal year 1997 budget request
        As I have stated, the AOC appropriations request for fiscal year
    1998 was prepared under the stewardship of William Ensign who assumed
    the position of Acting Architect of the Capitol upon the retirement of
    George M. White on November 21, 1995. In his presentation last year
    before this Subcommittee for the fiscal year 1997 appropriation
    request, Mr. Ensign, in recognition of the need for immediate budget
    restraint, brought forward a budget of $152,363,000, which represented
    a $6,088,000 reduction, or four percent less than the fiscal year 1996
    appropriation of $158,451,000. This was partially achieved through a
    five percent, 108 full time equivalent (FTE) staff reduction, bringing
    the total FTE count down to 2,043. This resulted in an overall staff
    reduction over the prior five years of more than 15 percent, a
    reduction that was generally mirrored by the reduction in Senate staff.
    Of particular interest to this Committee, the funding request for
    Senate and Joint activities was reduced to $120,773,000, a $4,677,000
    reduction.

    ----------------------------------------------------------------------------------------------------------------
                                                               Fiscal year    Reduction     Reduction    Fiscal year
                                                               1996 budget     amount        percent     1997 budget
    ----------------------------------------------------------------------------------------------------------------
    AOC.....................................................  $158,451,000    $6,088,000             4  $152,363,000
    Senate and Joint Activities.............................  $125,450,000    $4,677,000             4  $120,773,000
    FTE total...............................................         2,151           108             5         2,043
    ----------------------------------------------------------------------------------------------------------------

        In requesting these reductions, Mr. Ensign stated that it was ``* *
    * important to recognize that the requested reductions will necessitate
    deferring many needed improvements to Legislative Branch facilities.
    Many cyclical maintenance programs will also be deferred.'' He further
    stated ``* * * that this one year hiatus would give the agency an
    opportunity to conduct comprehensive agency-wide planning and
    coordination of cyclical maintenance projects and building system
    enhancements in a thorough systematic and programmed manner.''
        Mr. Ensign also had prepared an ``Architect of the Capitol
    Efficiency Initiative'' in response to 1996 direction from both the
    House and Senate ``* * * to develop proposals for downsizing,
    streamlining and privatizing various activities and report back to
    Congress in the fiscal year 1997 budget cycle.'' This initiative
    outlined eleven goals aimed at improved service delivery at reduced
    costs. While I have been briefed on the details of these goals, I have
    not had time to learn enough about the existing organization and its
    strengths and weaknesses, to adequately explore the range of options
    relative to staffing profiles, or to assess the validity of the
    specific goals that were presented. This office is now actively
    proceeding to investigate the existing organization in the context of
    overall Congressional support services.
        There are two major components to this budget request: an Operating
    Budget and a Capital Budget, as described below. The total budget that
    I bring to this Committee today amounts to $201,294,000, comprised of
    $147,323,000 for operating costs and $53,971,000 for capital costs.
    That amount, adjusted to reduce the House items, totals $161,891,000,
    of which $117,841,000 is for operating costs and $44,050,000 is for
    capital costs.
                       fiscal year 1998 operating budget
        Increases in the costs that comprise the operating budget--that is,
    those costs that support operations and maintenance, including
    salaries, are relatively small, in the range of six percent overall.
    The requested increase compares to several years of gradual declines in
    dollars appropriated for operating the Capitol complex. In fiscal year
    1995, for example, the operating budget totaled $148,277,000. This
    fiscal year we are operating with an appropriation level of
    $138,964,000, a 6.3 percent decrease from fiscal year 1995, not
    adjusted for inflation.
        The requested increase for fiscal year 1998 falls into several
    categories. Nearly two thirds of the operating increase is due to
    mandated pay costs and the government's share of benefits costs. Nearly
    ten percent relates to increased utility costs for the Capitol complex.
    An agency-wide uniform program is being proposed, which accounts for
    six percent of the increase. And the Librarian of Congress has
    requested that this agency increase the level of support and services
    in the three Library Buildings, and that cost increase accounts for
    five percent of the increase.
        The following table indicates these increases by appropriation.

    ----------------------------------------------------------------------------------------------------------------
                                                       Fiscal year 1997     Fiscal year 1998           Change
                                                            budget              estimate      ----------------------
                       Base costs                   ------------------------------------------
                                                      FTE      Dollars     FTE      Dollars       Dollars    Percent
    ----------------------------------------------------------------------------------------------------------------
    Capitol Buildings: Operating Budget............    394    29,059,000    394    31,234,000    +2,175,000     7.5
    Capitol Grounds: Operating Budget..............     77     4,770,000     77     5,008,000      +238,000     5.0
    Senate Office Buildings: Operating Budget......    609    36,010,000    609    37,063,000    +1,053,000     2.9
    Capitol Power Plant: Operating Budget..........     99    30,749,000     99    31,876,000    +1,127,000     3.7
    Library Buildings and Grounds: Operating Budget    146     8,343,000    146     9,450,000    +1,107,000    13.3
    Botanic Garden: Operating Budget...............     51     2,902,000     51     3,210,000      +308,000    10.6
    ----------------------------------------------------------------------------------------------------------------

        Of particular interest is the operations of the Senate Restaurants.
    I am reviewing these functions and will be making recommendations to
    the Committee on Rules and Administration.
                   fiscal year 1998 five year capital budget
        The fiscal year 1998 capital budget request I present to you today
    was prepared under William Ensign's stewardship and flows from the
    first five-year capital budget prepared by this agency. This five-year
    budget is grounded in a comprehensive and systematic agency-wide
    planning effort with in-depth involvement by all of the agency's
    clients. On the House side, these included the Sergeant at Arms, the
    Chief Administrative Officer and the Clerk of the House. On the Senate
    side these included the Sergeant at Arms and the Secretary of the
    Senate. The U.S. Capitol Police provided a detailed outline of their
    needs, and the Librarian of Congress was also extensively involved. A
    total of 205 capital projects have been identified for the five year
    period, requiring a total funding level of $353,516,000.
        While within the relatively short time I have held this office I
    clearly cannot be fully conversant with all the details on each of
    these projects, I have spent many hours reviewing all 205 projects. The
    reviews have included examining the scope, estimates, and priorities of
    the projects and visiting project sites. As a result of these reviews,
    I have concluded that the requested projects are needed and by-in-large
    the costs estimated are accurate, but in several cases may actually be
    somewhat conservative. I have categorized the projects into nine areas,
    reordered the priorities for some of the projects and, to provide more
    detail to the appropriations committees, I have subpriortized the
    projects.
        I fully concur with Mr. Ensign's statement that there is a need to
    provide the Congress with a five-year capital improvement budget to
    assist the Congress in making the wisest and best informed financial
    judgments ``* * * based on a formal evaluation of future cost
    implications and with the assurance that we have undertaken a rigorous
    examination of related needs.''
        The projects included in this budget, therefore, reflect all the
    needs that have been identified to date. I intend to continue to
    evaluate these needs and to update them to ensure that the capital
    budget is responsive to programmatic changes, the condition of the
    buildings and their systems, and any other needs that may arise.
        At last year's House of Representatives Subcommittee on Legislative
    Branch Appropriations Hearing a question was raised by Congressman
    Fazio, the Ranking Member, regarding the potential of a future
    ``balloon payment'' that might result from the accumulated costs of
    deferred maintenance. This question was right on target. The five-year
    capital budget that is being presented today establishes a multi-year
    funding plan that offers the Congress a clear view of what it will cost
    to maintain the Legislative Branch infrastructure in proper operating
    condition. The capital budget also identifies improvements that respond
    to new legally imposed standards and guidelines, such as improvements
    to meet the requirements of the Americans with Disabilities Act and the
    Occupational Safety and Health Act. There are also several projects
    that will enhance the operations of the Congress, as well as new
    projects requested by our clients to serve their programmatic needs.
    Balancing the needs of maintaining the existing infrastructure while
    keeping pace with technological enhancements and program needs is
    clearly costly. But I firmly believe that deferring these
    infrastructure reinvestment costs in the short to mid term can
    ultimately lead to far greater costs in the future. We are all also
    aware of the effect that technological pressures can have on aging
    building systems, especially from the perspective of being capable of
    delivering new telecommunications technologies.
        These projects are prioritized for your consideration as follows:
        Priority 1--Critical.--This category totals $36,856,000 and
    includes programs essential to the integrity of the Capitol complex
    infrastructure, including the following needs: assuring the structural
    and operational integrity of the Capitol complex infrastructure and
    building systems; assuring that programs essential for security, fire
    and life safety, and environmental and hazardous materials protection
    are provided; and assuring that programs under Congressional direction
    are carried out.
        Priority 2--Highly Desirable.--This category totals $7,631,000 and
    includes costs for highly desirable enhancements to the programs
    outlined in the ``Critical'' priority level, as well as new program
    initiatives that would improve the delivery of services.
        Priority 3--Desirable.--This category totals $376,000 and includes
    costs for programs that are desirable to implement, but that could be
    deferred in the near term without major interruption to current
    services.
        Priority 4--Client Request.--This category totals $9,108,000 and
    includes costs for new facilities or building renovations or
    enhancements to support programs that have been requested specifically
    by clients such as the Library of Congress, the U.S. Capitol Police,
    and congressional officers such as the Senate Sergeant at Arms and
    Secretary. Although funds to carry out the projects are requested in
    the Architect of the Capitol's budget, the responsibility for
    justifying these projects remains with the requesting client. However,
    in my revised prioritization I have included my recommendation of the
    client requested projects in our ranking categories.
        It is important to note that over $9 million of the nearly $54
    million requested in fiscal year 1998 are for capital projects related
    directly to client requests, i.e., $3,300,000 for the Library of
    Congress and $2,965,000 for the U.S. Capitol Police.
        It is also important to recognize that these requirements do not
    simply disappear if deferred. If projects requested for fiscal year
    1998 are deferred, the costs to accomplish them will rise due to added
    deterioration, increased maintenance costs to sustain the systems in
    the interim, inflation, and fluctuations in market conditions. The
    deferred projects also will then add to the fiscal year 1999 funding
    need, which has already been identified at $68 million. It is
    recognized that the total funding in the request is very large when
    compared to past years' submissions. Here is why:
        Replacement of Aging Building Systems.--Several of the buildings in
    the Capitol complex are reaching an age and condition that require
    major renovation or replacement of building systems. For example, the
    Ford House Office Building was renovated in the mid-1970's. Now, over
    twenty years later, some of its building systems are reaching the end
    of their useful life expectancies. Various improvements are therefore
    recommended for the Ford Building. Similar factors affect the Jefferson
    and Adams Library of Congress Buildings. Building systems that were
    evaluated in the late 1970's and early 1980's (during development of
    the Renovation and Restoration project) as being in adequate condition,
    now require substantial improvement. Likewise, systems in the James
    Madison Memorial Building that were originally designed and constructed
    in the mid 1970's are beginning to require replacement.
        Technological Advances.--Technology is changing far more rapidly
    than existing building infrastructures can support and adapt to. This
    is especially true in the rapidly expanding area of telecommunications,
    but there is a corollary effect that is felt in any building system
    that uses any sort of electronic technology for operation or support.
    The latter is a more subtle factor in building system maintenance,
    repair and replacement cycles. The subtlety lies in building systems
    that operate quite well for a time on a particular version or vintage
    of electronic technology. However, as these electronic systems wear
    out, compatible replacement components are not always readily
    available. Building systems that appear to be relatively ``new'' may
    require electronic upgrades to keep them operating. As an example of
    this type of project, funds are requested to upgrade the infrastructure
    supporting the Dirksen Building's telecommunications systems.
        Regulatory Compliance Requirements.--Programs essential for
    complying with the Americans with Disabilities Act, the Occupational
    Safety and Health Act, security, and environmental and hazardous
    material protection have received very high priority in terms of
    advancing the timetables for completion. Although efforts have been
    underway for several years in all these areas, recent external factors
    have caused this Office to reexamine the policy of meeting these needs
    over a longer term. Passage of the Congressional Accountability Act has
    reinforced our resolve to ensure that the Capitol complex is free of
    barriers and hazards to the Members, Senators, staff and visitors.
    Also, terrorist activity throughout the world has increased, and as a
    result there is a heightened sensitivity toward threats to security at
    the Capitol complex. These external factors have led this Office to
    include several projects in the fiscal year 1998 capital budget.
        Infrastructure Reinvestment.--Replacement Value--In 1991, the AOC
    sought to validate the level of funding that was being requested for
    reinvesting in the Capitol complex infrastructure. Cyclical maintenance
    funding methodologies which had been developed and used by three major
    universities were applied to the Capitol complex to determine the
    appropriate level of funding required to maintain these facilities. The
    result of applying these methodologies yielded an annual investment
    rate that averaged 1.7 percent of the replacement value of the Capitol
    complex. Based on the average investment rate of 1.7 percent, an annual
    reinvestment of approximately $57.5 million should be made in the
    physical plant of the Capitol complex in fiscal year 1998. The Capitol
    complex is valued conservatively at $3.6 billion. When the cost of new
    facilities are deducted from the capital funding levels presented for
    each of the five years in the capital budget, the remaining
    reinvestment levels are below this amount. As an order of magnitude
    point of reference, an annual investment of $36 million would represent
    approximately one percent of the hypothetical replacement value of the
    Capitol complex. I have reviewed other benchmark data and found that
    annual renewal investment rates realistically range from 1.5 to 3.0
    percent. In comparison, the fiscal year 1998 request related to
    existing facilities of $52 million is a 1.4 percent investment rate.
        The following table summarizes the funding levels presented in the
    five-year capital budget, and indicates the value of the amounts
    requested as cyclical maintenance items for reinvestment in the
    physical plant, client requests, and new initiatives requested to
    enhance existing support systems or those that may be requested in
    response to advances in technology. These five year projections will be
    reviewed, modified and updated each year as new information becomes
    available through detailed studies and evolving needs and priorities.

                                              FIVE-YEAR PLAN FUNDING LEVELS
    ----------------------------------------------------------------------------------------------------------------
                                                              Cyclical       Client     Continuing and
                          Fiscal year                        maintenance    requests    initiating \1\      Total
    ----------------------------------------------------------------------------------------------------------------
    1998..................................................   $20,960,000    $8,908,000    $24,103,000    $53,971,000
    1999..................................................    25,308,000    12,995,000     29,857,000     68,160,000
    2000..................................................    30,189,000    40,000,000     24,417,000     94,606,000
    2001..................................................    22,573,000    27,900,000     22,253,000     72,726,000
    2002..................................................    12,260,000     8,200,000      7,533,000     27,993,000
    2003-2007.............................................    17,765,000  ............     18,295,000   \2\ 36,060,0
                                                                                                                  00
    ----------------------------------------------------------------------------------------------------------------
    \1\ Including Regulatory Compliance Requirements and Technological Advances.
    \2\ To complete above projects.

        Mr. Chairman, I also wish to point out that this budget was
    prepared with the intent of requesting planning and design funding well
    in advance of large renovation and construction projects. Only design
    funding is requested for these large capital projects in fiscal year
    1998 in order to prepare detailed designs and firm cost estimates for
    justifying appropriations requests for construction in later years.
        The following table indicates the capital budget increases for
    fiscal year 1998.

    ----------------------------------------------------------------------------------------------------------------
                                                                        Fiscal year     Fiscal year
                             Capital projects                           1997 budget    1998 request       Change
    ----------------------------------------------------------------------------------------------------------------
    Capitol Buildings: Capital Budget...............................      $3,400,000     $10,830,000     +$7,430,000
    Capitol Grounds: Capital Budget.................................         250,000       1,610,000      +1,360,000
    Senate Office Buildings: Capital Budget.........................       4,280,000      14,958,000     +10,678,000
    Capitol Power Plant: Capital Budget.............................  ..............       1,895,000      +1,895,000
    Library Buildings and Grounds: Capital Budget...................       1,410,000       6,305,000      +4,895,000
    Botanic Garden: Capital Budget..................................  ..............       8,452,000      +8,452,000
    ----------------------------------------------------------------------------------------------------------------

        I assure the Chairman that I will work closely with him and the
    Committee staff between now and the time the Committee marks up this
    portion of the appropriations bill to achieve a rational and adequate
    funding level to support the needs of the Congress.
                                  human factor
        I have noted earlier in this Statement that it is premature for me
    to draw specific conclusions on how to best comply with the
    Congressional direction to downsize, prioritize and streamline the
    agency. It is projected that the portion of the budget presented here
    today that is related to salaries and benefits will be a worst case
    scenario, since staffing levels will not be increasing. When detailed
    recommendations about agency structure and composition are developed, I
    will present them for your consideration. At that time, whatever
    staffing efficiencies that are recommended to achieve the mid- to long-
    term savings we are striving for, will include recommendations relative
    to employee considerations.
        Achieving any goals that involve significant privatization or
    downsizing will mean a work force reduced beyond what has been realized
    in the past several years. Consequently, another goal identified
    previously must be to proceed in the most humane and caring way for our
    dedicated, long-term employees. I am reviewing our organization and
    responsiveness in areas affecting human resources management and equal
    employment opportunity. I will also review previously implemented
    measures, such as employee involvement in organizational issues through
    the Architect's Workteams which involve all employees through their
    elected representatives.
        I will also be evaluating the previously proposed Employee
    Protection Plan which called for Congressional approval of severance
    pay coverage, authority to declare ``early-out'' eligibility, and
    competitive status for all employees who may be released from our
    employ. That proposal also called for separation incentives to
    encourage turnover, waiver of the 2 percent reduction in annuity for
    each year under age 55 (perhaps modified), and other incentives for
    employees to volunteer for separation. I understand that some of these
    approaches have been instituted with Congressional authority by other
    government agencies, and I will evaluate whether they may be needed to
    provide us with the proper incentives and flexibility to deal fairly
    with agency employees during any transition brought about by downsizing
    or privatization measures. I also understand that in the past some
    confusion has existed over why these protections need to be made
    available to our employees. There are two reasons, one legal, one
    philosophical. First, our employees, unlike those in the Senate, are
    covered under title 5 of the U.S. Code, the AOC Human Resources Act of
    1995, and other statutes governing our employees' rights. These
    statutes place certain restrictions on how we could undertake any
    downsizing efforts. The Employee Protection Plan was developed to
    accommodate some of those restrictions. The philosophical difference
    between our employees and those of the Senate lies in the notion that
    is strongly held by our employees that employment here is a civil
    service career: they come to work here, earn their pay, contribute to
    their government retirement fund, and eventually, after a long career,
    retire. On the other hand, many Senate employees come and go as their
    Senators are re-elected and majority parties change.
        There is one aspect of the human factor that I wish to bring to
    your attention. As I learn more and more about this agency I have noted
    that it has a deep core of institutional knowledge that extends from
    top management down through the trades shops. It would seem appropriate
    to balance the desirability of downsizing the agency with the necessity
    of retaining this vital knowledge. I hope to be able to offer some
    thoughts on this subject in the near future.
                                   next steps
        As you can appreciate, the task ahead of assessing the agency with
    a fresh perspective and striving to arrive at cogent and feasible
    conclusions is a major one. I will be taking into consideration many
    factors, including the evaluation, recently performed for the agency by
    Arthur Andersen, an independent consulting firm. This evaluation
    provides benchmarking parameters comparing the nature and cost of
    services provided by the agency with those that could be provided by
    the private sector. Arthur Andersen data indicates that many of our
    services are quite competitive with private sector costs and services.
    I have been briefed by the Arthur Andersen team and it appears that
    their assumptions and study parameters are valid.
        I also intend to undertake a rigorous examination of our services
    and how the delivery of those services is viewed by our clients: Are we
    viewed as efficient and timely? In what areas do our clients feel we
    can improve? Do we clearly communicate to our clients how services are
    provided, and who should be contacted to initiate service requests? Do
    we follow up to make certain that our service efforts take care of our
    clients' needs?
        I have begun these efforts, and I assure this Committee that I
    intend to continue with these assessments expeditiously.
                                    summary
        I would like to conclude with two observations, one related to the
    capital budget request and one related to the agency's mission and
    services.
        With respect to the capital budget, I readily acknowledge that the
    amount requested is large, and given the current pressures to balance
    the Federal budget it will be extremely difficult to meet these needs.
    It is essential that this Committee and the Congress realize, however,
    that many of these projects are clearly necessary to properly conserve
    the ``peoples building'' and supporting structures for future
    generations. The need for funding these projects will continue.
        With respect to the agency's mission and services, I am committed
    to undertaking a timely evaluation of the specific reports and
    proposals that were prepared by my predecessor. I am equally committed
    to improvements in service delivery across the range of congressional
    support, and to making reasoned and validated adjustments to increase
    cost efficiency.
        I wish to assure you that I will report to you periodically on our
    progress as we examine all these issues. I believe that we can be more
    effective and more cost-efficient and still continue to fulfill the
    core mission of the agency. And with respect to our dedicated
    employees, I believe that we can be sensitive and humane as we proceed
    toward these ends. The Office of the Architect of the Capitol will
    continue to be professional and effective in meeting the challenges
    ahead.
        Mr. Chairman, that concludes my statement and I shall be pleased to
    respond to any questions that you and the Committee may have.
                                     ______

                     Biographical Sketch of Alan M. Hantman
        Born on October 13, 1942, in New York City, Alan M. Hantman, AIA,
    was appointed by President Bill Clinton on January 6, 1997 and
    confirmed by the Senate on January 30, 1997, to be the tenth Architect
    of the Capitol.
        Alan M. Hantman was graduated from the City College of New York
    with a bachelor's degree in architecture and earned a master's degree
    in urban planning from the City University of New York Graduate Center.
    He is a member of the American Institute of Architects, the Building
    Owners and Managers Association, the New York Building Congress, and
    the National Trust for Historic Preservation. He is certified by the
    National Council of Architectural Registration Boards and is currently
    licensed in the states of New York and New Jersey.
        Prior to his appointment he was Vice President of Facilities
    Planning and Architecture for the Rockefeller Center Management
    Corporation of New York City for 10 years and then served as their
    consultant. He received the Sidney L. Strauss Award from the New York
    Society of Architects for his work at the Center. He previously worked
    as a development consultant, assistant chief architect, and project
    manager at major architectural and real estate services firms.
        Mr. Hantman is the first Architect of the Capitol to be appointed
    under the new selection procedure established by legislation in 1989.

                             Inaugural sound system

        Senator Bennett. Well, I congratulate you on your
    presentation. It has been lucid and succinct and very clear.
        I have a few questions. I may submit some more for you in
    writing to respond to. I will start with perhaps some minor
    ones, but once again high visibility.
        Have you undertaken any studies regarding the sound system
    that is used for the inauguration?
        Mr. Hantman. We had a meeting last week--when I say we, I
    talk about the Senate Rules, Sergeants at Arms, the Secret
    Service--kind of a postmortem of the last inauguration with
    respect to security issues, life safety issues. We are
    beginning that process to review that going forward. We
    actually have a request for $100,000 in our fiscal year 2000
    budget which would be the year before the next inauguration.
        Our problems basically are that we normally do not start
    the process until the year of the inauguration, which does not
    give us enough time to really go through the issues whether it
    is reviewing the structure for the podium itself or the sound
    system. That $100,000 would include the research and
    investigation of an appropriate sound system and other issues
    related to the inauguration. But we are discussing them now. We
    are asking for funding in the fiscal year 2000 to actually go
    out and start doing that 1 year in advance of the inauguration
    itself.

                           Year 2000 system problems

        Senator Bennett. We have spent time in the committee
    talking about the year 2000 problem. Do you have some 2000
    problems?
        Mr. Hantman. We have an abacus, Mr. Chairman, that we are
    going to use very carefully.
        Senator Bennett. If you had an abacus, we would not have a
    year 2000 problem.
        Mr. Hantman. Exactly.
        Mr. Pregnall. Mr. Chairman, we have two types of year 2000
    problems that I am prepared to talk about, those affecting our
    financial systems, but we also have electronic systems that
    perhaps our Director of Engineering might speak to in terms of
    elevators, the subway system, and other electronically operated
    systems throughout the Capitol complex. Our energy management
    control system turns on and turns off fans on a 24-hour basis.
    Those little chips that affect that system may have a year 2000
    problem as well. So, we have a two-pronged effort in analyzing
    and developing a plan to make sure that come the year 2000, the
    agency can support the needs of the Congress.
        With respect to our financial systems, about 1\1/2\ years
    ago, we began implementing a task force to look at upgrading
    all of our legacy systems in the agency. Bill Ensign
    consolidated the accounting and budget functions under my
    predecessor's hat, and I now wear that mantle. We decided to
    begin emulating the rest of the Federal Government in terms of
    its financial processing, meeting the intent of the CFO Act,
    Government Performance and Results Act, and so forth.
        In looking at that, we discovered that our existing
    financial systems do not meet current Federal requirements, and
    not only that, they were standalone, homegrown, built-up
    systems that did not talk to each other. We also learned that
    we had a year 2000 problem in all of those systems. That
    clearly was our biggest concern in terms of meeting the year
    2000 deadline.
        We sought solutions for that, including cross-servicing
    with other agencies in the legislative branch, agencies in the
    executive branch that had systems. We looked at some other
    options as well going into our existing legacy systems and
    specifically reprogramming them to achieve a year 2000 fix even
    though they were not now compliant with Federal systems.
        Based on all of the analysis that we did and after talking
    this through with many people throughout the legislative
    branch, we decided to adopt a somewhat unique solution. We have
    an existing procurement system, which is a private sector-based
    system. It also has accounts payable, inventory, and other
    functions that we can use as a year 2000 fix and buy us a
    little bit of time until we can proceed with a full federally
    compliant financial management system. We have a funding
    request in the fiscal year 1998 to begin the procurement and
    implementation of that full integrated management system.
        During the discussion over the past 6 months, we have come
    across another opportunity based on some input from the
    legislative branch Financial Managers Council. This is a group
    representing all the budget officers for legislative branch
    agencies. The staff from Appropriations sit on it ex officio I
    believe as well. This is sort of a guidance group that we
    developed about 1\1/2\ years ago.
        We are looking at cross-servicing or possibly sharing an
    application for a standard general ledger system, a fully
    Government compliant SGL, that would bring us into full
    compliance with CFO, GPRA, the Federal Financial Management
    Improvements Act of 1996. If we can pursue this option with our
    somewhat unique solution for procurement, accounts payable, and
    inventory, we will be a step ahead of most of the other
    legislative branch agencies, and that is the course of action
    we are pursuing at this time.
        We are proceeding with the implementation of our year 2000
    fix with existing applications by implementing the fully
    integrated features in our procurement system. During fiscal
    year 1998 we will be exploring, especially with the Government
    Printing Office which has a similar type function that we have,
    acquiring a general ledger system. They have a year 2000
    problem with their general ledger as well. So, we are both
    quite interested in pursuing this. That would bring us into
    full compliance for the time being with all Federal financial
    requirements.
        [The information follows:]
                          Letter From Alan M. Hantman
                                  The Architect of the Capitol,
                                         Washington, DC, June 16, 1997.
    The Honorable Robert F. Bennett,
    Chairman, Subcommittee on Legislative Branch Appropriations, Committee
            on Appropriations, United States Senate, Washington, DC
        Dear Mr. Chairman: I am writing on a matter related to our present
    financial systems. The present systems will be affected by the year
    2000 coding problem that affects so many computer applications. Thus,
    there is an immediate need to change out the present systems. I also am
    aware that the Committee has directed this office to consult with the
    General Accounting Office and the Library of Congress on this matter as
    it relates to our long term financial systems needs. I want to assure
    you that I support the stated goal of converging on a standard
    financial accounting and management system for the legislative branch.
        Based largely on the initial guidance of the General Accounting
    Office and the Library of Congress, this office has spent much of the
    past year defining functional requirements for our new financial
    systems. We have also drafted a schedule for acquisition and
    implementation of this new system. As we have proceeded with this
    process, because of the imminence of the year 2000 problem with the
    existing systems, we have became quite concerned over the timing of the
    planned system implementation effort.
        This concern is apparently shared by the GAO and LOC, since both
    have provided cautionary advice to us over the last year concerning our
    office's ability to acquire and implement a totally new, fully
    integrated financial system within the next two fiscal years. Although
    we have remained hopeful that cost savings for implementation might be
    achieved through an advantageous cross-servicing agreement with another
    Legislative Branch or other government entity, we are still somewhat
    concerned about the potentially high costs even under such an
    arrangement. For these reasons, we have requested $650,000 in our
    fiscal year 1998 budget funding for system acquisition and
    implementation costs.
        We have explored potential interim measures that would enable the
    AOC to meet its financial requirements through the year 2000 without a
    major expenditure of funds and/or resources. We have discovered that
    there is a year 2000 fix for the software that is used by our
    Procurement Division that can interact with our Accounting Division.
    The existing Procurement application (referred to as CAS software) is
    an integrated software package which contains financial modules (for
    Procurement, Inventory, Accounting, and Budget functions) capable of
    supporting most of our agency's immediate needs. We must upgrade our
    agency's existing CAS Procurement application to address the year 2000
    fix. We therefore intend to use the additional financial modules in the
    CAS software package as an interim fix for addressing the full scope of
    our year 2000 problem. It has an added benefit of achieving more than
    just a year 2000 fix. The various modules provide a total system
    integration solution for our agency's Procurement, Accounting,
    Inventory and Budget functions which will eliminate the dual, and
    sometimes triple, manual data entry currently performed by many of our
    personnel.
        We have compared the cost of fixing the existing systems with the
    cost of the CAS solution. Fixing the present procurement and accounting
    systems would cost more than $100,000, and would gain no increased
    functionality or bring the agency any closer to meeting our stated
    financial system goals. The cost of the CAS solution is approximately
    $130,000, and would significantly increase functionality between
    procurement, accounting, inventory and budgeting processes. We are very
    comfortable that the incremental cost increase of pursuing the CAS
    solution will provide the agency with the best possible solution to the
    year 2000 problem.
        We intend to proceed within the next week based on our immediate
    need to achieve a year 2000 fix. Under this timetable, the full CAS
    software application package can be installed for our agency by the
    beginning of fiscal year 1998. Additionally, funds are available for
    this purpose. We intend to proceed with this interim fix with the
    understanding of and commitment to the greater long-term solution in
    consonance with the Committee's direction.
        I shall, of course, be pleased to provide you with any additional
    information on this matter you may deem desirable.
                Cordially,
                                          Alan M. Hantman, AIA,
                                              Architect of the Capitol.

        Senator Bennett. Thank you.
        What is the timeframe for your ability to produce auditable
    financial statements?
        Mr. Pregnall. In order to produce auditable financial
    statements, Mr. Chairman, we first have to have that general
    ledger system in place and collecting data and then producing
    information. If we are successful during fiscal year 1998 of
    implementing a general ledger system, we will collect data
    during fiscal year 1999. We will have financial statements at
    the end of 1999, albeit they will be somewhat clumsy and
    incomplete because it will only have 1 year of information
    included.
        Our goal is to be able to produce auditable statements by
    the year 2000. Now, we do not expect to get a clean audit the
    first time out of the block. Other legislative branch agencies
    have not been able to do this. It usually takes one or two
    runthroughs to get a clean audit based on financial statements,
    but our goal right now is to have a first go in the year 2000
    and shoot for having a clean audit by the year 2001 or 2002.
        Senator Bennett. Thank you.

                         Additional committee questions

        I have no further questions. As I say, we may submit some
    to you for inclusion in the record.
        Let me conclude as I began with welcoming you and
    commending you for the work you have done and the staff that
    you have assembled and retained. We look forward to working
    closely with you to resolve the various problems.
        I am one who believes very strongly from my experience in
    the private sector that the most foolish financial thing you
    can do is cut down on routine maintenance for a short-term
    financial benefit, only to face very substantial long-term
    requirements as your physical plant collapses.
        We face a problem here in that unlike a private enterprise
    we cannot tear down the deteriorating physical plant and build
    a new one. As I say, the American people would not permit us to
    do that even if we were to suggest it. The reverence they have
    for this building, I think well deserved, is sufficiently
    strong enough that tearing it down is not an option.
        Mr. Hantman. I would not have suggested that, Mr. Chairman.
        Senator Bennett. I understand.
        Thank you very much.
        Mr. Hantman. Thank you very much.
        [The following questions were not asked at the hearing, but
    were submitted to the office for response subsequent to the
    hearing:]
                         Additional Committee Questions
                                 privatization
        Question. What is the status of your review regarding functions
    within the Office of the Architect of the Capitol which could be
    privatized?
        Answer. In the few months I have been in office, I have been in the
    process of learning as much as possible about the overall operations of
    the agency. Internally, I have held meetings with virtually every
    employee of the agency to open lines of communication about what they
    see as needs and to let them know what I have learned in my short
    tenure. In order to learn about how our services are perceived by our
    customers, I have also held meetings with key staff and office managers
    on both sides of the Congress to learn their perspectives on the
    agency: are we doing a good job? Are there areas where we need to be
    doing a better job? I am asking questions and getting responses at that
    level. And I have opened dialogue with my colleagues, the Senate
    Sergeant at Arms and Secretary of the Senate, and their counterparts on
    the House side as well, to see if there are areas were we might jointly
    improve operations and to see if there are areas where we have
    overlapping responsibilities and might achieve efficiencies. And I have
    begun the process of following up on my initial job interviews for this
    position with key Senators and Representatives of the House, as well as
    our oversight committees, to gain their views. Finally, I have sought
    outside expertise in looking at the overall operations of the agency.
    We have an initial study done by Arthur Andersen that has provided a
    third view of the agency.
        All of this information is being processed, and we are still
    gathering more. Once I have collected all this data, I intend to
    examine it from the framework of an overall strategic planning effort:
    let us make sure that we are clear in our mission goals and that we
    have the organization and resources to meet that mission. The
    organization I foresee will definitely have some mix of privatized and
    in house services, but I am not knowledgeable enough at this point to
    say precisely how much or even what services might be privatized.
    Clearly, we have much work ahead of us in the near future to move this
    plan forward. I will continue to keep this Subcommittee and its staff
    informed of our progress, and will seek input at appropriate junctures.
                                 visitor center
        Question. Mr. Hantman, have you reviewed the plans for the Visitor
    Center? Do you have any suggestions or modifications to the plan? What
    is the estimated cost of this project and construction time? How much
    has already been raised in private funds? What are the long-term
    maintenance costs to your office? Will the Visitor Center impose any
    addition or reduction in responsibilities for your office?
        Answer. I have reviewed the plans for the Capitol Visitor Center
    and have met with the associate architects on the project. Although I
    raised a few questions with them on some details, I believe the design
    of the core and shell of the project is basically quite sound.
        In my judgment it would be prudent to assume that the entire
    project will cost approximately $125 million, which would allow for
    cost escalations, plan modifications resulting from the design of
    exhibits and security enhancements, certain Capitol interface
    conditions and the cost of exhibit design itself. A construction period
    of 3\1/2\ to 4 years is anticipated.
        No private funds have as yet been raised for the project, there
    being as yet no authority to solicit them. My understanding is that
    approximately $24 million in private funds now held by the Capitol
    Preservation Commission may be applied to the project in whatever way
    would be most useful to its financing.
        We believe that if net revenues generated by the cafeteria, gift
    shop and other income generating activities of the project are
    allocated to operating the Visitor Center, the project could be self-
    supporting. The structural, mechanical and custodial care of the
    project will be added to the responsibilities of the Capitol
    Superintendent, but it may be possible to privatize many aspects of the
    management of the Visitor Center.
                     operating and capital projects budget
        Question. Mr. Hantman, now that you have had time to review the
    operating and capital projects budget submitted by your predecessor, do
    you have any changes that you would recommend for the fiscal year 1998
    budget of the Architect of the Capitol?
        Answer. I have held lengthy review sessions to personally look at
    the capital and operating budget requests. As a result of these
    reviews, I can say that there are only a few very minor dollar changes
    that I would make at this time. I have revised the overall
    categorization of the projects to define them in terms of life safety
    issues, security issues, infrastructure reinvestment issues, and so on.
    These project categories convey more clearly the type of work that we
    are intending to do and give the Committee an indication of the type of
    result that can be expected from expending these dollars: a life safety
    project will clearly result in a safer building environment; an
    infrastructure reinvestment project will extend the useful life of a
    facility by repairing or replacing worn out components.
        The other major point that I would make is that the five year
    capital budget is an ongoing process. We will review it in light of the
    final action taken during this appropriations cycle, and also look at
    new needs that may be identified as upcoming requirements. Thus, when
    we come before this Committee for the fiscal year 1999 budget request,
    you can be assured that we have not simply rolled forward projects
    deferred this year and added them to what we now think will be needed
    next year.
                          integrated management system
        Question. The budget includes a request for $650,000 for an
    integrated management system to develop a fully integrated financial
    management system. When do you estimate that system to be completed?
        Answer. The funds requested in the fiscal year 1998 budget for the
    IMS in the amount of $650,000 were originally estimated to be
    sufficient to procure and begin implementation of the system. Based on
    guidance from the LBFMC, we are now concerned that the requested
    funding level is insufficient. Additionally, and with guidance and
    concurrence with the LBFMC, we are proposing to utilize the fiscal year
    1998 funds to explore the possibility of acquiring through cross-
    servicing or shared applications a government-approved general ledger
    application. This would bring the agency into compliance with current
    federal financial systems. If we can successfully pursue this approach
    during fiscal year 1998, we would be in a position to allow the next
    generation of federal financial systems now being sold in the market
    place to mature. We would then seek funding to procure and implement a
    wholly integrated IMS.

                             conclusion of hearings

        Senator Bennett. If there is no further business, the
    subcommittee stands in recess.
        [Whereupon, at 12:09 p.m., Tuesday, June 10, the hearings
    were concluded, and the subcommittee was recessed, to reconvene
    subject to the call of the Chair.]

           LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                                  ----------
                                                                       Page
    Abrecht, Chief Gary L., U.S. Capitol Police......................
      45, 71.........................................................
        Prepared statement...........................................    74
    American Association of Law Libraries, letter from...............   183
    Archer, Hon. Bill, Chairman, Joint Committee on Taxation.........    13
        Prepared statement...........................................    15
    Association of Research Libraries, prepared statement............   179

    Balderson, Stuart, Financial Clerk of the Senate, Office of the
      Secretary of the Senate, U.S. Senate...........................   265
        Prepared statement...........................................   295
    Becker, Herbert S., Director, Information Technology Services,
      Library of Congress............................................   105
    Billington, Dr. James H., Librarian of Congress, Library of
      Congress.......................................................   105
        Prepared statement...........................................   108
    Blum, James L., Deputy Director, Congressional Budget Office.....    91
    Brown, Richard L., Controller, General Accounting Office.........   227

    Campanale, Louise, Special Assistant, Financial Management
      Information System and Legislative Information System, Office
      of the Secretary of the Senate, U.S. Senate....................   265
    Casey, Hon. Gregory S., Chairman, U.S. Capitol Police Board;
      Sergeant at Arms, Office of the Sergeant at Arms and
      Doorkeeper, U.S. Senate........................................
      45, 299........................................................
        Biographical sketch..........................................   310
        Prepared statements..........................................
          49, 307....................................................
    Cook, Charles C., Superintendent, Congressional Printing
      Management Division, Government Printing Office................   199
    Cylke, Frank Kurt, Director, National Library Service for the
      Blind and Physically Handicapped, Library of Congress..........   105

    Del Balzo, Gail, General Counsel, Congressional Budget Office....    91
    Delquadro, David M., Personnel Officer, Congressional Budget
      Office.........................................................    91
    Desautels, Mark G., Assistant for Intergovernmental Relations,
      Congressional Budget Office....................................    91
    Dey, Christopher, Chief Financial Officer, Office of the Sergeant
      at Arms and Doorkeeper, U.S. Senate............................   299
    DiMario, Michael F., Public Printer, Government Printing Office..   199
        Prepared statement...........................................   201
    Dodaro, Joan M., Assistant Comptroller General for Operations,
      General Accounting Office......................................   227
    Dorgan, Hon. Byron, U.S. Senator from North Dakota, questions
      submitted by...................................................   239
    Duffy, Dennis, General Counsel, Office of Compliance.............   249

    Ford, Hon. Wendell H., prepared statement........................     5
    Frenze, Christopher, Executive Director, Joint Economic Committee     7

    Greigg, Stanley L., Director, Office of Intergovernmental
      Relations, Congressional Budget Office.........................    91
    Guy, William M., Budget Officer, Government Printing Office......   199
    Hantman, Alan M., Architect of the Capitol; and member, U.S.
      Capitol Police Board...........................................
      45, 315........................................................
        Biographical sketch..........................................   332
        Letter from..................................................   334
        Prepared statement...........................................   326
    Harris, Larry, Administrative Assistant, Office of the Sergeant
      at Arms and Doorkeeper, U.S. Senate............................   299
    Hinchman, James F., Acting Comptroller General of the United
      States, General Accounting Office..............................   227
        Prepared statement...........................................   229
    Hodges, Polly E., Budget and Finance Officer, Congressional
      Budget Office..................................................    91
    Hughes-Brown, Beth, Budget Officer, Office of Compliance.........   249

    Jenkins, Jo Ann C., Chief of Staff, Office of the Librarian,
      Library of Congress............................................   105

    Kelley, Wayne P., Superintendent of Documents, Government
      Printing Of- fice..............................................   199
    Kies, Kenneth J., Chief of Staff, Joint Committee on Taxation....    13

    Livingood, Hon. Wilson, Sergeant at Arms, U.S. House of
      Representatives, member, U.S. Capitol Police Board.............    45
        Prepared statement...........................................    71
    Lopez, Kenneth E., Director of Security, Library of Congress.....   105

    Medina, Rubens, Law Librarian, Library of Congress...............   105
    Mulhollan, Daniel P., Director, Congressional Research Service,
      Library of Congress............................................   105
        Prepared statement...........................................   123

    Nager, Glen, Chairman of the Board, Office of Compliance.........   249

    O'Neill, Hon. June E., Director, Congressional Budget Office.....    91
        Prepared statement...........................................    92
    Orton, Hon. Bill, former U.S. Representative from Utah...........   243

    Pauls, Lloyd A., Associate Librarian for Human Resources, Library
      of Congress....................................................   105
    Peach, J. Dexter, Assistant Comptroller General for Planning and
      Reporting, General Accounting Office...........................   227
    Peters, Marybeth, Register of Copyrights, Library of Congress....   105
        Prepared statement...........................................   121
    Peterson, Eric C., Staff Director, Joint Committee on Printing...     1
    Pregnall, Stuart, Budget Officer/Director of Financial Services,
      Architect of the Capitol.......................................   315

    Ravenberg, Duane, Head of Telecommunications, Office of the
      Sergeant at Arms and Doorkeeper, U.S. Senate...................   299

    Saxton, Hon. Jim, Chairman, Joint Economic Committee.............     7
        Prepared statement...........................................     8
    Schmitt, Bernard A., Deputy Chief of Staff, Revenue Analysis,
      Joint Committee on Taxation....................................    13
    Schmitt, Mary M., Deputy Chief of Staff, Law, Joint Committee on
      Taxation.......................................................    13
    Scott, Gen. Donald L., retired, Deputy Librarian of Congress,
      Library of Congress............................................
      105, 152.......................................................
    Silberman, Ricky, Executive Director, Office of Compliance.......   249
        Prepared statement...........................................   253
    Sisco, Hon. Gary, Secretary of the Senate, Office of the
      Secretary of the Senate, U.S. Senate...........................   265
        Biographical sketch..........................................   294
        Prepared statement...........................................   271
    Stephens, James, Deputy Executive Director for the House, Office
      of Compliance..................................................   249
    Symms, Loretta, Deputy Sergeant at Arms, Office of the Sergeant
      at Arms and Doorkeeper, U.S. Senate............................   299

    Tabb, Winston, Associate Librarian for Library Services, Library
      of Con- gress..................................................   105
    Talkin, Pam, Deputy Executive Director for the Senate, Office of
      Compli- ance...................................................   249

    Warner, Hon. John W., Chairman, Joint Committee on Printing......     1
        Prepared statement...........................................     3
    Washington, Linda J., Director, Integrated Support Services,
      Library of Congress............................................   105
    Webster, John D., Director, Financial Services, Library of
      Congress.......................................................   105
    Williams, Kathy A., Budget Officer, Library of Congress..........   105

    Zargorn, Janet S., chair, American Bar Association Standing
      Committee on the Law Library of Congress.......................   243
        Prepared statement...........................................   244
    Zelaska, Sharon, Assistant Secretary of the Senate, Office of the
      Secretary of the Senate, U.S. Senate...........................   265
    Zimmerman, Daniel F., Chief, Systems Development and Research
      Unit, Congressional Budget Office..............................    91

                                 SUBJECT INDEX

                                  ----------

                            ARCHITECT OF THE CAPITOL

                                                                       Page
    Additional committee questions...................................   336
    AOC:
        And Sergeants at Arms responsibilities.......................   319
        Consolidation plan...........................................   319
        Management needs.............................................   317
        Project request..............................................   319
        Supervisors, training needs of...............................   317
    Background information--fiscal year 1997 budget request..........   327
    Capitol complex replacement value................................   322
    Construction management employees................................   317
    Cyclical maintenance project.....................................   323
    Cyclical reinvestment budget.....................................   321
    Five-year capital budget:
        Fiscal year 1998.............................................   328
        Plan.........................................................   325
    Human factor.....................................................   331
    Inaugural sound system...........................................   332
    Integrated management system.....................................   337
    Monumental construction, benchmark for...........................   322
    Next steps.......................................................   331
    Office of the Architect of the Capitol, role of the..............   326
    Operating and capital projects budget............................   337
    Operating budget:
        And capital projects.........................................   320
        Fiscal year 1998.............................................   328
    Outsourcing and privatization....................................   317
    Physical plant, condition of the.................................   316
    Privatization....................................................   336
    Reprioritized projects...........................................   324
    Visitor center...................................................
      325, 337.......................................................
    Year 2000 system problems........................................   333

                              CAPITOL POLICE BOARD

    Accounting:
        Function/management review...................................    86
        System.......................................................    88
    Additional committee questions...................................    83
    AOC MOU..........................................................    87
    Bombs............................................................    81
    COLA/comparability costs.........................................    84
    Computer and telecommunications..................................    85
    Computers, upgrading.............................................    76
    House services...................................................    86
    Jurisdiction.....................................................    77
    K-9 facility.....................................................
      80, 87.........................................................
    Library and Supreme Court Police forces, consolidating...........    80
    Library of Congress merger.......................................    89
    New positions....................................................    84
    NFC status.......................................................    87
    Other services increase..........................................    85
    Parity issues, remaining.........................................    85
    Pay parity.......................................................    79
        Initiatives..................................................    84
    Physical security................................................    89
        Supplemental spending plan...................................    87
    Property crimes..................................................    78
    Scheduled leave/threshold........................................    84
    Senate/House positions...........................................    87
    Systems acquisition..............................................    90
    Transportation of persons........................................    77
    U.S. Capitol Police fiscal year 1998 budget request..............    50
    Unified payroll..................................................    88
    Unionization status..............................................    88

                          CONGRESSIONAL BUDGET OFFICE

    Additional committee questions...................................   103
    ADP and other spending, reductions in............................   101
    Budget request...................................................    91
    CBO's revenue projections, changes in............................   102
    Fiscal year 1998 request.........................................    94
    Joint Committee on Taxation and other agencies, relationship with
      the............................................................   103
    Major new work efforts during 1996...............................    93

                           GENERAL ACCOUNTING OFFICE

    Accomplishments and highlights, fiscal year 1996.................   229
    Additional committee questions...................................   234
    Associates, introduction of......................................   227
    Biennial budgets.................................................   232
    Budget request, fiscal year 1998.................................   230
    Comptroller General, process for selecting.......................   233
    Congressional commission, need for to meet.......................   233
    Consolidated financial statement.................................   232
    GAO building usage study.........................................   231
    Highlights of statement..........................................   228
    25-percent budget reduction, actions taken to absorb the.........   230
    Year 2000 problem................................................   234

                           GOVERNMENT PRINTING OFFICE

    Additional committee questions...................................   213
    Appropriations request, fiscal year 1998.........................   201
    Associates, introduction of......................................   199
    Billing practices................................................   212
    By-law distribution..............................................   219
    Congressional printing and binding appropriation.................   201
    Congressional Record, study on privatizing the...................   202
    Congressional Record/Federal Register, privatizing the...........   218
    Depository library transition plan...............................   215
    Energy conservation..............................................   218
    Federal depository library program...............................   206
    Financial management.............................................   210
    Government Performance and Results Act [GRPA]....................   220
    GPO:
        And Congress.................................................   203
        And Federal agencies.........................................   204
        And information dissemination................................   205
        Appropriated funding.........................................   201
        Long-range planning for the year 2000........................   219
        Mission in the information age...............................   203
        1998 budget request..........................................   217
    Hearings, pilot project for online access to committee...........   219
    House clerk's proposed document management system................   216
    Personnel........................................................   217
    Public Printer's statement.......................................   199
    Revolving fund losses............................................   211
    Revolving fund/GPO year end losses/printing rates................   213
    Salaries and expenses appropriation..............................   202
    Title 44, upcoming Rules Committee hearing on....................   216
    Year 2000 problem................................................   210

                          JOINT COMMITTEE ON PRINTING

    Congressional printing and binding appropriation.................     5
    GPO's revolving fund.............................................     4
    JCP budget increase..............................................     5
    Staff, introduction of...........................................     1
    Title 44:
        Costs relating to violations.................................     3
        Legislative proposal to revise...............................     2
        Reform.......................................................     3

                          JOINT COMMITTEE ON TAXATION

    Additional committee questions...................................    35
    Appropriation request, details of fiscal year 1998...............    16
    Budget request...................................................    13
        Summary of fiscal year 1998..................................    15
    Joint Committee on Taxation:
        Review of operations during calendar year 1996...............    18
        Summary of anticipated workload for calendar year 1997.......    20
    Luxury boat tax..................................................    31
    Macroeconomic estimates..........................................    32
    Responsibilities, additional.....................................    28
    Revenue estimating...............................................    29
    Tracking experience..............................................    30

                            JOINT ECONOMIC COMMITTEE

    Opening statement................................................     7

                              LIBRARY OF CONGRESS

    Accident compensation............................................   174
    Accountability mechanisms........................................   173
    Additional committee questions...................................   166
    Automated system charts..........................................   153
    Budget:
        Impact.......................................................   161
        Priorities, fiscal year 1998.................................   169
    Building compliance..............................................   172
    Capitol visitor center...........................................   168
    Congressional Accountability Act.................................   172
    Congressional publications.......................................   169
    Copyright CORDS..................................................   179
    Copyright Office:
        Processing time..............................................   178
        Retirement eligibility.......................................   179
    CRS:
        Personnel....................................................   177
        Workload.....................................................   175
    Digitization, expense in.........................................   160
    Digitizing materials.............................................   164
        Cost of......................................................   159
    Donations, money raised through private..........................   158
    Early history....................................................   110
    Electronic transactions..........................................   155
    Enabling infrastructure..........................................   117
    Facilitative leadership..........................................   152
    Federal Communications Commission................................   163
    Federal-State shifts.............................................   177
    Financial audit..................................................
      166, 172.......................................................
    First book storage module........................................   160
    Fort Meade storage facility......................................
      160, 165.......................................................
    ILS:
        Installation.................................................   170
        Investment chart, questions on...............................   154
    Integrated system:
        Cost for.....................................................   154
        New..........................................................   153
    Internal control.................................................   167
    Internet, concerns for school hookup to the......................   162
    Kellogg Foundation, grant from the...............................   159
    Legislation, proposed............................................   118
    Library of Congress:
        Buildings and grounds........................................   117
        Collection...................................................   170
        Digital project with others, coordination of.................   158
        Information systems, hooking schools to......................   161
        Network relationships........................................   159
        Planning efforts.............................................   111
        Security.....................................................   175
        Systems, security plan for...................................   165
        Technology...................................................   173
        Today........................................................   111
        Vision for the 21st century..................................   107
    Management improvement plan......................................
      153, 169, 170, 173, 175, 179...................................
    Our challenge: To prepare for the concentrated loss of CRS
      experts........................................................   126
    Our highest priority: Sustain the scope and enhance the CRS
      services, quality of...........................................   124
    Police overtime..................................................   169
    Revolving fund legislation.......................................   175
    Security.........................................................   165
        Management plan..............................................   169
        Report.......................................................   174
    Software development.............................................   162
    Staff level......................................................   168
    Storage:
        As a possible future expense.................................   159
        Media, additional............................................   162
    Strategic plan...................................................   107
    Streamlined management processes.................................   171
    Support functions' efficiency and responsiveness.................   174
    System viruses...................................................   165
    Systematic training and development..............................   173
    Talking book machines............................................   154
    THOMAS...........................................................   107
    Title 44 proposal................................................   167
    Unprocessed Library arrearages...................................   173
    Upgrading the systems............................................   161
    Work force, reduction in.........................................   154
    Year 2000........................................................   156
        Concerns on the problem......................................   163
        Funding to avoid problem.....................................   163

                              OFFICE OF COMPLIANCE

    Additional committee questions...................................   260
    Administrative and financial improvements........................   257
    Alternative dispute resolution and case processing...............   252
    Dispute resolution process.......................................   254
    Education and information........................................   256
    Fiscal year 1998 request.........................................   258
    Inspections, technical assistance, and investigations............   255
    Library of Congress, space in....................................   259
    Office of Compliance's authority and responsibilities............   254
    Regulation writing...............................................   256
    Studies and reports..............................................   257

                                  U.S. SENATE

                     Office of the Secretary of the Senate

    Administrative offices...........................................   279
    Associates, introduction of......................................   265
    Budget:
        Proposed for fiscal year 1998................................   266
        Summary......................................................   271
    Capitol visitors center..........................................   270
    Financial management information system..........................   267
    Hearing tracking service.........................................   295
    Legislative:
        Departments..................................................   272
        Information system...........................................   268
    Personnel management.............................................   269
    Senate library...................................................   269
    Strategic planning...............................................   267
    Succession planning..............................................   270

                 Office of the Sergeant at Arms and Doorkeeper

    Associates, introduction of......................................   299
    Customer service.................................................   312
    Full-time equivalent positions...................................   314
    Overlapping management...........................................   311

                                      (all)