[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



                 TREASURY, POSTAL SERVICE, AND GENERAL

                     GOVERNMENT APPROPRIATIONS FOR

                            FISCAL YEAR 2002

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS
                              FIRST SESSION
                                ________
  SUBCOMMITTEE ON THE TREASURY, POSTAL SERVICE, AND GENERAL GOVERNMENT 
                             APPROPRIATIONS
                ERNEST J. ISTOOK, Jr., Oklahoma, Chairman
 FRANK R. WOLF, Virginia             STENY H. HOYER, Maryland
 ANNE M. NORTHUP, Kentucky           CARRIE P. MEEK, Florida
 JOHN E. SUNUNU, New Hampshire       DAVID E. PRICE, North Carolina
 JOHN E. PETERSON, Pennsylvania      STEVEN R. ROTHMAN, New Jersey
 TODD TIAHRT, Kansas                 PETER J. VISCLOSKY, Indiana   
 JOHN E. SWEENEY, New York
 DON SHERWOOD, Pennsylvania         
                          
 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
       Michelle Mrdeza, Jeff Ashford, Kurt Dodd, and Tammy Hughes,
                            Staff Assistants
                                ________
                                 PART 2

                  EXECUTIVE OFFICE OF THE PRESIDENT AND
                   FUNDS APPROPRIATED TO THE PRESIDENT
                                   AND
                          INDEPENDENT AGENCIES

                              

                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 73-567                     WASHINGTON : 2001





                      COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio                  DAVID R. OBEY, Wisconsin
 JERRY LEWIS, California             JOHN P. MURTHA, Pennsylvania
 HAROLD ROGERS, Kentucky             NORMAN D. DICKS, Washington
 JOE SKEEN, New Mexico               MARTIN OLAV SABO, Minnesota
 FRANK R. WOLF, Virginia             STENY H. HOYER, Maryland
 TOM DeLAY, Texas                    ALAN B. MOLLOHAN, West Virginia
 JIM KOLBE, Arizona                  MARCY KAPTUR, Ohio
 SONNY CALLAHAN, Alabama             NANCY PELOSI, California
 JAMES T. WALSH, New York            PETER J. VISCLOSKY, Indiana
 CHARLES H. TAYLOR, North Carolina   NITA M. LOWEY, New York
 DAVID L. HOBSON, Ohio               JOSE E. SERRANO, New York
 ERNEST J. ISTOOK, Jr., Oklahoma     ROSA L. DeLAURO, Connecticut
 HENRY BONILLA, Texas                JAMES P. MORAN, Virginia
 JOE KNOLLENBERG, Michigan           JOHN W. OLVER, Massachusetts
 DAN MILLER, Florida                 ED PASTOR, Arizona
 JACK KINGSTON, Georgia              CARRIE P. MEEK, Florida
 RODNEY P. FRELINGHUYSEN, New Jersey DAVID E. PRICE, North Carolina
 ROGER F. WICKER, Mississippi        CHET EDWARDS, Texas
 GEORGE R. NETHERCUTT, Jr.,          ROBERT E. ``BUD'' CRAMER, Jr., 
Washington                           Alabama
 RANDY ``DUKE'' CUNNINGHAM,          PATRICK J. KENNEDY, Rhode Island
California                           JAMES E. CLYBURN, South Carolina
 TODD TIAHRT, Kansas                 MAURICE D. HINCHEY, New York
 ZACH WAMP, Tennessee                LUCILLE ROYBAL-ALLARD, California
 TOM LATHAM, Iowa                    SAM FARR, California
 ANNE M. NORTHUP, Kentucky           JESSE L. JACKSON, Jr., Illinois
 ROBERT B. ADERHOLT, Alabama         CAROLYN C. KILPATRICK, Michigan
 JO ANN EMERSON, Missouri            ALLEN BOYD, Florida
 JOHN E. SUNUNU, New Hampshire       CHAKA FATTAH, Pennsylvania
 KAY GRANGER, Texas                  STEVEN R. ROTHMAN, New Jersey    
 JOHN E. PETERSON, Pennsylvania
 JOHN T. DOOLITTLE, California
 RAY LaHOOD, Illinois
 JOHN E. SWEENEY, New York
 DAVID VITTER, Louisiana
 DON SHERWOOD, Pennsylvania
   
 VIRGIL H. GOODE, Jr., Virginia     
                                  
                 James W. Dyer, Clerk and Staff Director

                                  (ii)

 
  TREASURY, POSTAL SERVICE, AND GENERAL GOVERNMENT APPROPRIATIONS FOR 
                                  2002

                              ----------                              

                                             Thursday, May 3, 2001.

                   EXECUTIVE OFFICE OF THE PRESIDENT

                               WITNESSES

PHILLIP D. LARSEN, SPECIAL ASSISTANT TO THE PRESIDENT AND DIRECTOR OF 
    THE OFFICE OF ADMINISTRATION, EXECUTIVE OFFICE OF THE PRESIDENT
JAMES F. DANIEL, ASSOCIATE DIRECTOR FOR FINANCIAL MANAGEMENT, OFFICE OF 
    ADMINISTRATION, EXECUTIVE OFFICE OF THE PRESIDENT
    Mr. Istook. I call the subcommittee to order. Good 
afternoon. I am pleased to welcome on behalf of the White House 
and the Executive Office of the President the Special Assistant 
to the President and Director of the White House's Office of 
Administration, Phil Larsen. Mr. Larsen, you are not a stranger 
to the White House and you are not a stranger to the Congress. 
You have a long, distinguished career. We appreciate that, your 
service to the legislative and executive branches; and I was 
told it's 34 years; is that correct?
    Mr. Larsen. Probably closer to 27.
    Mr. Istook. Okay. Well, I wasn't going to be surprised if 
it was 34 years. I was just going to be surprised that you 
would actually admit it. So we certainly all appreciate and 
commend your dedication to civil service and commitment to 
ensure that the President has all the tools he needs. And with 
you this afternoon, if you want to----
    Mr. Larsen. With me this afternoon at the table is Jim 
Daniel. He's the Associate Director for Financial Management in 
Office of Administration.
    Mr. Istook. We are glad to have you here, Mr. Daniel. I 
know it's a lot of hard work and it's been especially hard work 
going through the transition that you both have been through 
and to some extent are still going through right now. So we 
appreciate the efforts that you have made.
    I certainly share your desire to make sure that we have a 
close and solid working relationship and, as I know you 
reference in your opening statement, one that always keeps in 
mind our respective roles. There's a special level of deference 
that I know this subcommittee has always felt necessary toward 
the White House and the Executive Office of the President. I 
know that Mr. Hoyer certainly shared that during his time in 
chairing this subcommittee. That doesn't change our roles as 
fiscal stewards and watchdogs, but we do recognize the 
difference in the branches under our Constitution. And I want 
to assure you that I, and I believe every member of this 
subcommittee, is committed to making sure that the President 
has the tools, the staff, and the resources that he needs to 
carry out his responsibilities.
    Over the past several years we have certainly seen 
tremendous growth in some of the costs associated with the 
Executive Office of the President and the Executive Residence, 
something that we all find necessary to maintain in peak 
condition because it is a very unique institution, a very 
unique place in the entire country.
    As appropriators, we have the responsibility to make sure 
the Federal dollars are used for their intended and authorized 
purposes, no others, and in ways that reflect sound management 
and sound business judgment. So, because of this, there's been 
different changes to the White House account over recent years. 
I don't anticipate any rescission being proposed by the Bush 
administration of those. We do have a draft budget amendment 
for the Executive Office of the President that focuses on 
consolidating 16 separate appropriations accounts into one, 
which we look forward to discussing with you. Certainly we can 
recognize some merits of what the President would like to do 
with streamlining and centralizing some basic support 
functions, but we have concerns about implications on our 
ability to have proper oversight with the necessary degree of 
information flowing back and forth. So I assure you that, just 
as we had maintained scrutiny during the prior Administration 
to look after taxpayers' dollars, we wish to have that same 
level of scrutiny with the current Administration. I don't 
think that you would have any disagreement with that principle 
either.
    The President is calling on all the Federal agencies to 
tighten their belts, to be smart with the resources that they 
employ. Obviously given the freeze plus budget that the 
President has requested, he's taking that burden upon himself 
as well. And we all recognize that one important attribute of 
leadership is leadership by example. While I'm certain there 
are some economies of scale that the White House could achieve, 
as I mentioned to you before, I have some concern where the 
White House nevertheless may shortchange itself. We all want to 
make sure that the President has all the necessary resources. 
For instance, I am aware the White House has had unanticipated 
expenses in connection with ongoing efforts to reconstruct e-
mail, and even though that activity has been transferred to the 
National Archives, the EOP still has an active role in that. It 
involves unexpected activity, with additional costs exceeding a 
million dollars, which the Bush Administration, through no 
fault of its own, has had to absorb. That's an absorption that 
we certainly don't hold against the Administration and want to 
rectify, if the White House so wishes.
    I am curious that there was not a supplemental request for 
appropriations for transition-related expenses, realizing that 
some of the expenses of the outgoing Administration, with the 
changes associated with that, and severance pay required, that 
they were certainly spending some amounts in excess of what we 
expected would be spent. That obviously could create a desire 
by the President for a supplemental appropriations to make sure 
that he has the requisite personnel.
    So it's been a little unusual to us that there was not such 
a request. We're not begging you to take any money that you 
don't want. We are simply trying to signal to you that this 
body does want to make sure that the President has the 
appropriations, the funding, the resources, and the personnel 
that he deems are necessary to carry out his enormous 
responsibilities.
    [The information follows:]

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    Mr. Istook. So, Mr. Larsen, we are pleased to have you. I 
look forward to your testimony. But before we hear that, I'd 
like to recognize our Ranking Member, Mr. Hoyer.
    Mr. Hoyer. Thank you very much, Mr. Chairman. I must say 
where you sit apparently, I want to say somewhat cynically, 
affects how much resources you think the White House ought to 
have. I've gone through now 5 years of hearings where the White 
House did not receive as receptive a hearing as I thought they 
deserved. I'm pleased at your comments but it's a very, very 
different tone in dealing with a Republican administration than 
a Democratic administration.
    I want to tell you, very frankly, I'm going to be very 
serious about this budget. I've served on this committee for 18 
years. For 13 years this committee, headed by Democrats, gave 
to Republican Presidents everything they wanted, with minuscule 
exceptions dealing with the Environmental Council. In the past 
5 years, this budget has been subjected to scrutiny far beyond 
what I thought was appropriate as it related to the comity that 
should exist between the executive and the legislative agencies 
and unlike anything that had occurred, notwithstanding the fact 
that there was substantial difference between the Reagan 
administration and this House, headed by Democrats and 
controlled by Democrats overwhelmingly, and indeed by the Bush 
administration.
    Frankly, I had not intended to be as pointed in my opening 
remarks, but nobody was falling all over themselves last time 
to make sure the White House had sufficient resources to do 
their job or, when they got in crunches as it related to 
computers, to facilitate their handling that.
    Now, this is not directed at either one of you, but it is 
to say that we are going to be very serious about making sure 
that the criteria applied to the former White House is applied 
to this White House. I will do it in the framework of a very 
strong commitment to that first 13 years that I was on this 
committee, where I think that the White House, the executive 
agency, the Office of the President, deserves deference, and I 
don't intend to change from that mode of operation. I agree 
with the Chairman's comments that the White House does in fact 
need the resources necessary to carry out the duties to which 
the American public elected it.
    I intend to follow that conviction. I don't want you to 
think that because what I thought was done to the White House 
last time was not appropriate that I intend to follow that same 
conduct. I do not, because I do believe, as the Chairman 
indicates, that you are due deference, but I want to say in all 
fairness that it will not affect me in terms of the 
consideration that I give the White House that Jim Daniels 
lives in my district, but it will be an important point in 
dealing with him. I want you to know that.
    But I don't know how familiar you are or how much of a 
review of the record you have made over the last 5, 6, 7, 8 
years, but we have had real contention with respect to this 
minuscule budget, in my opinion for political reasons, not for 
budget reasons, and some of that time the Chairman was not on 
this committee and the Chairman of this committee was somebody 
for whom I have great respect and, more importantly, great 
admiration and affection and who is, I think, my good friend, 
Mr. Kolbe. But we have very serious differences on how this 
White House budget was treated under the Clinton 
administration.
    So I want to place in context for you what my focus might 
be. Again, I do not intend to apply what I perceive to be the 
same criteria that were applied in the past, but I will be 
cognizant of them and do intend to point out on an appropriate 
basis discrepancies that I see between the treatment of the 
former White House and this White House by the Majority.
    Thank you very much Mr. Chairman.
    Mr. Istook. Thank you, Mr. Hoyer. I think that if you went 
back through the record during my prior service on this 
subcommittee, you will certainly find that I made the same type 
of comments with the attitude of deference and respect for the 
institution and the individual serving as President. We may all 
sometimes have disagreements on specific items, whether we 
think it's merited or whether it's being done in a 
straightforward matter and so forth, but I don't think that 
undercuts what you have and that I have, and I believe every 
member of our subcommittee has, which is a healthy and proper 
respect for the Presidency and for those that serve the 
Presidency.
    Mr. Larsen, we are prepared for your testimony. It's our 
practice before we receive it to swear all witnesses, and I 
don't know if Mr. Daniel would be intended to share in the 
testimony or not, so whether he should receive the oath also. 
If you would stand.
    [Witnesses sworn.]
    Mr. Istook. Thank you both. And please feel free, Mr. 
Larsen, since we have your written statement which will be in 
the record in its entirety, feel free to depart from it or even 
to be extemporaneous, however you wish.
    Mr. Larsen. Thank you, Mr. Chairman, members of the 
committee. I will summarize my statement for you and we can, 
with your permission, put the balance of it in the record.
    I'd like to respond to the comments both from the Chairman 
and Mr. Hoyer. As I said in my opening statement, we are 
absolutely committed to working with this committee and its 
counterpart in the Senate to open a dialogue and have close 
collaboration on everything we are doing.
    I have been fortunate, as the Chairman pointed out, to have 
had the opportunity to sit both at this table and on the other 
side, and I know the importance of having open communications, 
and accurate information. Most problems can be resolved if we 
work together on that. I have had the pleasure of meeting with 
you. I'm delighted to see Michelle there. I have known Michelle 
for a long time. We hope to keep this dialogue open at all 
times.

                         TRANSITION ACTIVITIES

    The testimony that I'm going to present today consists of 9 
of the 13 components of the Executive Office of the President. 
But before I go into some of the details, I might just mention 
a few highlights of the last 15 weeks or so. As the Chairman 
mentioned, we are finishing up the transition period. We did 
what I believe--and I have been through a few of them--a very 
smooth transition, at least as far as the Executive Office of 
the President and the White House is concerned. In accordance 
with the direction of the President and the Chief of Staff, all 
new employees completed their personnel action and payroll 
actions in the required time; that is, within the first 14 days 
following the date of their appointment. In addition, they all 
completed the standard Form 86, which is the security 
questionnaire, and had it turned in within 30 days of the date 
of their employment.
    During the first 50 days we appointed 334 new employees in 
the Executive Office of the President, and of those 323 of them 
were drug tested within the first 30 days of their appointment.
    Within the first 60 days, we produced an employee manual 
which is about this thick, which provides guidance for all the 
new staff on how to do things around the White House. It is an 
administrative manual. And we were able to put out an Executive 
Office of the President-wide telephone book within the first 60 
days.
    As I said, I have been through several Presidential 
transitions. This one went very, very smoothly and I attribute 
that basically to two factors. Number one, we were fortunate in 
that many of the people that were coming into the White House 
had been there before. Two of the people coming in, Vice 
President Cheney and Chief of Staff Andy Card, had served as 
Chiefs of Staff in the White House before. So we had a good 
foundation and we had a good group of people who knew what to 
expect when they arrived.
    Secondly, I think credit goes to the administrative and the 
career staff that is in the White House that carries over from 
administration to administration. Jim is an example of them, 
and several of them behind me. These are folks who work every 
day to support the EOP, Office of the President, regardless of 
who the President is. When we came in and we had 15 weeks to 
get ready for this hearing and even shorter times to do other 
things, these are the folks we turned to, and they're the ones 
who produced the results. We certainly couldn't have had a 
good, smooth transition without them.
    Now, in addition to getting through the transition--and as 
you indicated, we're not all the way through all of it yet--we 
have initiated a couple of things that we'd like to share with 
the committee. As you all know, the Chief Financial Officers 
Act was amended last year to include the Executive Office of 
the President, and it was to go into effect on Inauguration 
Day, on January 20th. We're excited about that. We see that as 
an opportunity to streamline some processes and get a better 
handle on this sprawling enterprise of 13 different agencies.
    Under the CFO Act, all financial management activities in 
the Executive Office of the President will come under the 
jurisdiction of the Chief Financial Officer, CFO. We are 
recruiting at the present time. I am interviewing people at the 
present time to come down to a group of final 5, from which the 
selection will be made. We hope that will be done by the end of 
the month.
    In addition, the act requires a person designated by the 
President to serve as the agency head for the EOP. That 
designation has been prepared and a person has been designated, 
but it has not been approved yet by the President. As soon as 
it has been approved I will let you know who it is.
    In addition, and you touched on it briefly, in addition, in 
order to make the CFO Act work, we believe it would be 
appropriate to consolidate the EOP separate appropriations into 
a single appropriation. And I know OMB has had discussions with 
many of you on this amendment which is also on the President's 
desk to be signed and should be to you, later today.
    What this allows the CFO to do is to give him full 
jurisdiction, within limits, over the entire financial 
management activities of the Executive Office of the President. 
Currently that is splintered among 13 different agencies. Each 
agency head has complete control over his own group of money. 
That makes it very difficult for us to do anything on an EOP-
wide basis, because all it takes is one agency head to say he 
or she doesn't want to play, and then it's all back to separate 
accounting again.
    Another initiative that we started, and are very, very 
happy with the results, is the effort we are putting into 
supporting Presidential travel in a new and unique way. This is 
the sixth administration I've served under in the Executive 
Office of the President. There's been a continuing problem with 
Presidential travel in trying to get all the bills in, trying 
to get all the vouchers in, and getting them all paid in a 
reasonable time, so that you are not beyond the time limit to 
pay the bill and so you don't have unhappy vendors. It's always 
been a major concern.
    What we have done is taken an individual, or individuals, 
from the Office of Administration financial management staff 
and send them out on the trips as the business manager. They go 
out with a government credit card. They pay the bills as they 
order things, so the vendors are happy; and when they come 
back, they process all remaining bills. Our goal is to have all 
of the trips closed out, from a financial point of view, within 
30 days after the end of the trip. Right now we are running at 
an 80 percent closeout rate for vendors and 97 percent rate for 
the traveling staff. We have been running this program now for 
4 weeks, 5 weeks.
    Mr. Daniel. About--it will be about 4 or 5.
    Mr. Larsen. Mr. Chairman, I'm aware that the committee is 
interested in the EOP's information technology program. As I 
said in my statement, we were disappointed in what we found 
when we came in, but I want to make it clear that it is through 
no fault of the staff that was here. I guess we were just 
expecting a little higher level of technology than what we 
found. There could be a number of reasons for it. I don't think 
it's necessary to go into them, but because the level of 
technology that we were looking for is not there, we have taken 
a very hard look about putting anything new up at the current 
time. We're going through the current plan, the current capital 
investment plan, project by project. Some of those, 
particularly in the development of various applications, we put 
on a temporary hold until we get a better handle on what 
exactly that product is going to be and what it is it going to 
do for us. Some of the other capital investment program items 
are not on hold. They have to do with infrastructure. They're 
going to be necessary to do, regardless of what kind of 
applications we end up with: such things as cabling in the 
various buildings. Those things are not on hold and we will 
proceed with them.
    In addition, we've asked the Secretary of Defense to put 
together his top people to come in and give us an independent 
review of the communication and information technology support 
that is available to the President and the Office of the 
President. That group of people should be providing an interim 
report within a matter of just a couple of days and the final 
report is due within 45 days after that.
    Again, let me say to the committee we don't believe that it 
has anything to do with the career staff that are running the 
computer center. Rather, we believe the main root cause is a 
lack of strategic planning. There is no strategic plan for 
running the computer operation in the Executive Office of the 
President. To that end, we are also recruiting at the present 
time for a senior level chief information officer, who will be 
given three or four positions to work along with, to come in 
and take over the computer operation and to become the chief 
planner of that entire operation. We can't buildan architecture 
until we have a plan. We have an architecture but it's not based on a 
plan. So we eventually probably are going to just have to stop for a 
while until we get--go back to basics, go back to square one, build a 
plan, and then march forward.
    I can continue on and summarize basically the high points 
or the dollar amounts in each of the budgets. As you know, most 
of the budgets presented here are a freeze at current fiscal 
year '01 levels, with a moderate increase in personnel that 
covers the January 2002 pay increase. There are a couple of 
accounts that have small increases. The Vice President has 
requested an additional two FTEs. There's a couple of other 
accounts that have a minor increase. The Vice President's 
residence has a reduction of $40 thousand in dealing with the 
transfer of the responsibility for utilities.
    I believe those are the main increases and decreases. 
There's a couple more but basically it's a flat budget.
    Again, in closing let me say, as someone who has served in 
both the House, the Senate, and the White House, I believe I 
understand what your requirements are and am committed to 
working with you to make sure everybody is on the same page. I 
think we can resolve a lot of issues by doing that before we 
end up in a committee hearing.
    I started my career as part of the career staff in the 
Executive Office Building back when it was still called the 
Bureau of the Budget and sort of worked my way up through the 
ranks, and it's a special honor for me now to be the person in 
charge of the Office of Administration as I close out my 
career. I will be available; you can call me at any time. Thank 
you.
    [The information follows:]

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    Mr. Istook. Thank you very much, Mr. Larsen. I thought you 
were about to tell us that you started out in the Old Executive 
Office Building back when it was still the young Executive 
Office Building, but I guess not.
    For the record will you tell us, since you are appearing on 
behalf of, as you say, of 9 of the 13 components of the 
Executive Office of the President, would you tell us for the 
record--perhaps it's easier--which 4 you are not appearing on 
behalf of?
    Mr. Larsen. Those I am not appearing on behalf of are the 
Office of Management and Budget, the Office of National Drug 
Control Policy, the United States Trade Representative, and the 
Council of Environmental Quality.

                         INFORMATION TECHNOLOGY

    Mr. Istook. Okay, I appreciate that. There are several 
things that we might start with. Let me ask regarding the 
information technology. You said there's an ongoing evaluation, 
which to me indicates there may be some uncertainty with 
whether you believe the current budget request is going to 
prove adequate or whether there may be some adjustment that's 
desired by the White House. Is the nature of the situation that 
systems are either, not modern or not compatible or is it that, 
although they may be compatible, there's such a variation in 
the types of systems employed that there's not the ability to 
do uniform adjustments and uniform updates and use the uniform 
software across them?
    Mr. Larsen. I think there's some of both of that. I think 
the biggest concern we have is the lack of the strategic plan 
which puts everybody in a reactionary mode, and what happens is 
a requirement will come up in somewhat of a crisis mode and 
there will be a bit of a planning on how to handle the crisis, 
and they come up with a solution and we hang it up on the 
computer and then we don't do any more planning. And so what we 
end up with is this collection of different kinds of programs 
that eventually have to get jerryrigged to work with each 
other. It would just be so much more economical for all of us 
to have a plan, that from that plan you have an architecture 
and from that architecture you have an implementation plan, and 
that way when requirements come up you know how to fill them. 
Right now, we don't do that.
    Mr. Istook. So, although some of the equipment may be 
fairly modern, nevertheless there's a lot of individuality in 
the individual systems that doesn't give you the consistency 
that you need across the entire operation.
    Mr. Larsen. That's correct.
    Mr. Istook. Okay. And should we anticipate that there will 
be a request to increase the amount related to information 
technology as you are going through this review process?
    Mr. Larsen. I don't believe so. My charge, not only with 
regard to information technology but everything else, including 
transition, was to we are to live within the money we've got.
    Mr. Istook. And what's the difference between the strategic 
plan that you say you are seeking to put in place regarding the 
information technology and that which the former Administration 
told us they had in place?
    Mr. Larsen. From what I've been able to see, what they had 
in place was the information technology architecture. The 
strategic plan to me is a more general document where you go 
out on an enterprise-wide basis and you identify what's going 
on here, who's doing what, what are they doing, and without any 
reference at all as to whether or not it could be automated or 
improved. You have got to first identify what the requirements 
are and then you go into your information technology 
architecture and say okay, what applications would serve to 
perform this function, and then following that you go into an 
implementation plan, so you make sure you implement A before B 
and not vice versa.

                            TELEPHONE SYSTEM

    Mr. Istook. Let me ask as far as unanticipated expenses--we 
realize there was certainly some confusion regarding the phone 
system coming in and I believe you had contractors that had to 
come in--what was the unanticipated expense of resolving that 
confusion?
    Mr. Larsen. I don't believe--do you have that with you?I 
can get it for you for the record. There always is additional cost in a 
transition, particularly in the area of telephones. It is just because 
a lot of telephones have to be moved around.
    [The information follows:]

                 Transition Telecommunications Expenses

    The Executive Office of the President expended $134,846.90 
for telecommunications equipment and repairs during the 
presidential transition. During this period, the effort focused 
on providing the new Administration with reliable 
telecommunications support as quickly and efficiently as 
possible. We did not track, nor do our records show, the cause 
of the repairs that were made.

    Mr. Istook. Right. I understand. There was a concern, about 
being able to match the particular instrument that had to be 
programmed to meet the particular plug. Am I mistaken--tell me 
if I'm wrong, but I was understanding that it was not just the 
anticipated expense of having to move some phones around, but 
you had some expense that you did not anticipate in having to 
bring in contractors who could then match up the plugs or 
reprogram the plugs and the instruments so they would work with 
one another.
    Mr. Larsen. There was some of that. There was a contractor 
had been put on contract prior to us getting there, just in 
anticipation, knowing there's going to be a lot of phones have 
to be moved around as a normal part of the transition, and in 
that process obviously some did get disconnected, so the 
contractors in some cases did spend time searching to find the 
right plug.
    Mr. Istook. I was just looking for the number, if you have 
it, of what portion of that was the unanticipated portion.
    Mr. Larsen. Right.
    Mr. Istook. Okay. As compared with that which is part of 
the normal transition, if you could let me come back to some 
other things, but I think it is time to yield to Mr. Hoyer.

                          WHITE HOUSE STAFFING

    Mr. Hoyer. Thank you very much. Thank you, Mr. Larsen, for 
your testimony. What's the total staffing level for fiscal year 
2002 in the White House?
    Mr. Larsen. In the White House?
    Mr. Hoyer. Yes.
    Mr. Larsen. The FTE request is for 400. Right now we are at 
362, 362 FTE is where we're running.
    Mr. Hoyer. How does that relate to last year's budget, do 
you know?
    Mr. Larsen. It is--the 400 FTE is the same.
    Mr. Hoyer. Is the same; so it is flatlined.
    Mr. Larsen. Right.
    Mr. Hoyer. There are 362. Do you expect to have any 
substantial staffing changes during the course of the year? I 
know it's still early.
    Mr. Larsen. No, I don't believe so.
    Mr. Hoyer. Now, there are two additional for the Vice 
President's office.
    Mr. Larsen. Yes.
    Mr. Hoyer. What does that bring the Vice President's FTEs 
to? Do you know off the top of your head?
    Mr. Larsen. Twenty-four.
    Mr. Hoyer. Twenty-four. Do you know what the two new FTEs 
will be doing.
    Mr. Larsen. The reason the two new FTEs were requested is 
because 24 is more of a historical number for the Vice 
President's office, more consistent with what it's always been. 
Second of all, there will be an effort to use less detailees 
than have been used in the past. So instead we have two full-
time FTEs. Vice President Cheney as you probably can tell is 
very, very active and very, very involved--and it's just a 
feeling that they need two additional FTEs to fill out the 
component of all of the responsibilities that the Vice 
President has. Specific functions I really can't tell you at 
this time.

                        CHIEF FINANCIAL OFFICER

    Mr. Hoyer. I understand. Now you talked about the Chief 
Financial Officer. Now, you may have said this. Has a CFO been 
selected?
    Mr. Larsen. No.
    Mr. Hoyer. Okay. Which organizational unit will the CFO be 
in?
    Mr. Larsen. At the present time--and what I can give you is 
what our thinking is--I don't want to preempt the President 
because he's not signed off on this.
    Mr. Hoyer. Right.
    Mr. Larsen. Our thinking is that he/she will be in the 
Office of Administration.
    Mr. Hoyer. And I don't want to imply by that question I 
think he ought to be one place or the other.
    Mr. Larsen. I understand.
    Mr. Hoyer. And as a result, will that position report to 
whom, to you?
    Mr. Larsen. Yes, that's correct. Well, let me put it this 
way. It's--when the law was passed, they took the CFO Act from 
1990, and that act says that the CFO shall report to the head 
of the agency. And then they got to looking at it and said, 
well, who is the head of the EOP, because the EOP itself is not 
an agency, it's an umbrella term for a collection of agencies.
    Mr. Hoyer. Right.
    Mr. Larsen. So the statute was written to say that. The 
President shall designate an individual from his senior staff 
to serve as the head of the agency called the EOP for the 
purposes of administering the Financial Management Act or the 
CFO Act. There's a designation that has been prepared to make 
the director of OA as the head of the agency. That also is on 
the President's desk. And, you know, he may change his mind and 
have somebody else do it.
    Mr. Hoyer. Okay I understand you. So maybe you or maybe 
somebody else the President designates.
    Mr. Larsen. That's correct.
    Mr. Hoyer. Okay. How many staff will the CFO have? Has that 
been decided?
    Mr. Larsen. Well, the Congress gave us five positionslast 
year, in midyear, through the CFO Act. We haven't decided entirely. I 
can share with you what my thinking will be.
    Mr. Hoyer. Okay.
    Mr. Larsen. That if the CFO becomes a part of the OA staff, 
Jim's operation, the Financial Management Division--which 
currently how many do you have?
    Mr. Daniel. Twenty-four.
    Mr. Larsen. Twenty-four will be merged up with those other 
five positions to create a whole office.
    Mr. Hoyer. All right. Now, what will Jim's relationship to 
the CFO be?
    Mr. Larsen. He's going to be like his deputy.
    Mr. Hoyer. Okay. I understand you. And that would be 29 
people; 5 plus, 29.
    Mr. Larsen. In that range, that's correct.

                          UNANTICIPATED NEEDS

    Mr. Hoyer. Okay. Now, on the unanticipated needs account, 
am I correct you reduced that?
    Mr. Larsen. Yes. It was reduced by 2 million.
    Mr. Hoyer. Two and a half million.
    Mr. Larsen. Two and a half million. And the reason for that 
is there was a special allocation approved by the Congress for 
the Puerto Rico vote, and the money has not been transferred to 
the Puerto Rican Election Commission yet. We have been in 
contact with them, but they have certain requirements they have 
to do under the statute to organize and so forth, and once that 
has been done, then we will release that money to them. And I 
believe it was the congressional intent that this was a one-
time thing, so that's the reason for the reduction.

                  VICE PRESIDENT'S RESIDENCE UTILITIES

    Mr. Hoyer. Okay. Let me ask you another question first. You 
indicate that the Vice President's office is being reduced by 
approximately $40,000.
    Mr. Larsen. Yes, sir.
    Mr. Hoyer. But I understand that reduction is essentially a 
transfer of utility responsibilities to the Navy.
    Mr. Larsen. That's right, and that's the Vice President's 
residence.
    Mr. Hoyer. Now, while I understand that that residency is 
operated by the Navy, in shifting over that expense there's 
been a great focus from time to time on how much utilities were 
spent at certain agencies. There's been a lot of discussion 
about how much it costs to keep the lights on for extra guests 
at the White House, as you know.
    Now a convenient way to get out of that, frankly, is to 
transfer utility costs to the Navy. So you can see my 
consternation at that request, not because you are making it; 
normally I would ignore that if we hadn't spent hours, I 
underline hours, hours of hearings on how much Bill Clinton 
spent by having people stay in the Lincoln bedroom and how much 
the lights were on and itemizing food costs. So you know this 
subcommittee is going very carefully into this.
    How am I going to know if Mr. Cheney has a lot of parties 
and the utility bills go up substantially? Do I have to ask the 
Navy?
    Mr. Larsen. I would guess that's the answer. This decision 
was made prior to us arriving on January 20th. This was in the 
original budget. It was negotiated in the prior administration. 
Jim, you were there.
    Mr. Hoyer. You mean Senator Lieberman was anticipating this 
problem.
    Mr. Larsen. No, I don't attribute anything to it.
    Mr. Hoyer. We are all chuckling, because I think it sounds 
ridiculous myself. I'm making perhaps a small significant 
point--but we spent hours on it as we transfer this expense 
from one budget to another--and it looks like the Vice 
President's budget is going down when in fact we're simply 
taking a line from one to one which I think is insignificant, 
frankly. But you indicate that it was proposed in the original 
budget as submitted.
    Mr. Larsen. That's my understanding.
    Mr. Hoyer. So the prior administration had done that.
    Mr. Larsen. That's correct.
    Mr. Hoyer. They were tired of, I guess, getting the utility 
questions themselves.

                  INFORMATION TECHNOLOGY ARCHITECTURE

    Mr. Hoyer. Now, going back to the issue of the--you are 
going to in terms of the computer system--we've had a lot of 
discussion about the computer system. We have had a lot of 
trouble with computer systems, not just the White House but a 
lot of other agencies, in term of both--and this committee 
was--I think frankly helped the White House, as I've said, in 
the past in terms of demanding architecture. Now you are saying 
that the architecture is in place. It's the strategic plan 
that's not in place.
    Mr. Larsen. The architecture is partially in place. I don't 
believe at this point in time that I'm willing to sign off on 
that document as what I would consider to be the final 
document.
    Mr. Hoyer. Okay. When do you expect there to be a final 
document?
    Mr. Larsen. I would expect we could have that done within 
the next 5 to 6 weeks.
    Mr. Hoyer. And would you expect to submit that to the 
committee?
    Mr. Larsen. Absolutely.
    Mr. Hoyer. Prior to us approving any expenditures.
    Mr. Larsen. Absolutely.
    Mr. Hoyer. My time is probably up on the first round, Mr. 
Chairman. Thank you for your consideration.
    Mr. Istook. Thank you. Since we have a different situation 
than this morning, I was will be more lenient.
    Mr. Hoyer. Thank you, sir.
    Mr. Istook. Mr. Sherwood. Grab the mike if you would, 
please, sir. Thank you.
    Mr. Sherwood. You said, Mr. Larsen, that you are a little 
disappointed with the technology, or the hardware and the 
system. And how long do you think it will get to take to get 
that upgraded to where you are happy with it?
    Mr. Larsen. Oh, I think there's some things we can do in 
the short term but there's some major issues that are going to 
require several years, as evidenced by the capital investment 
plan which this committee has been so instrumental in providing 
for us which goes all the way out to fiscal year '06. There are 
some big jobs that need to be done. For example, the cabling of 
the buildings; those are huge jobs. There's other things of 
that nature that I think short-term fixes we can probably have 
up by the end of the fiscal year or calendar year.
    Mr. Sherwood. So this, it looks as if this hasn't--hasn't 
been done in some time.
    Mr. Larsen. No. I think--I think there's been a number of 
reasons. You know, number one, as I stressed, there is no 
strategic plan. Another problem that I didn't mention--and you 
know this goes back even beyond the prior administration, this 
goes just to the way the EOP has run its computer shopfor many 
years. In the last 10 years there's been 13 directors of that office, 
and that's pretty hard for any kind of stability, particularly in a 
high-tech area, because about the time the director comes in and 
develops a plan, they move on and the new one comes in and says this is 
no good, and they start a new plan. And consequently, you end up with a 
staff who only reacts to things as they come down the pike and nothing 
ever gets put into place in a logical, sequential, systematic way. And 
I think that's where we're at today.
    Mr. Sherwood. You are here to assure us that you will be 
there long enough to get the job done.
    Mr. Larsen. Yes. I'll be here for quite a while yet, I 
hope.
    Mr. Istook. Maybe until it's the ancient Executive Office 
Building.
    Mr. Sherwood. But if I might, you sort of told us that you 
had a smooth transition with very experienced people and were 
presenting us with basically a flat budget.
    Mr. Larsen. Yes that's correct.
    Mr. Sherwood. Well, I think that's what I came to hear, and 
thank you.
    Mr. Larsen. You are welcome.
    Mr. Istook. Thank you, Mr. Sherwood.
    Mr. Rothman.
    Mr. Rothman. Thank you, Mr. Chairman. Mr. Larsen, it is a 
pleasure to see you, and Mr. Daniel, thank you as well for 
being here. I'm a new member of the Appropriations Committee 
and I have a couple of questions. I hope you can walk me 
through the answers.

                 ELECTRONIC DOCUMENTS MANAGEMENT SYSTEM

    One part of the Executive Office of the President's 
operations that received a lot of attention in the recent past 
was the system for retaining electronic documents generated in 
the Executive Office of the President.
    Mr. Larsen. Correct.
    Mr. Rothman. And in reviewing the budget request you've 
submitted, the capital investment plan of the information 
systems and technology division, it appears that you are paying 
some attention to that problem.
    Mr. Larsen. That's correct.
    Mr. Rothman. And as a matter of fact, the submission says 
that the primary need is for top-to-bottom redesign of the 
EOP's critical electronic records management system.
    Mr. Larsen. That's correct.
    Mr. Rothman. And you have asked for $2 million to perform 
that task.
    Mr. Larsen. Yes, sir.
    Mr. Rothman. Since, as your request says, you need a top-
to-bottom redesign, could you tell me a couple of things about 
the system itself? How long will it take to get up to speed or 
to implement a new system? Do you have a plan for that? And in 
between now and when you get to implement that plan, what's 
going to happen to the electronic documents? Are they going to 
be archived? Who has them?
    Mr. Larsen. Okay. Our current system, called the ARMS 
System, will remain in place until the new system is found or 
developed, is brought up, is tested, and run parallel for a 
while until we are absolutely sure we can stop the old system 
and bring up the new one. We are currently working with the 
National Archives and Records Administration very closely in a 
cooperative effort to identify the type of system that we need 
to either buy or build, and that's where we're at right now on 
that.
    The old ARMS system--and I don't want to go back and redo a 
whole lot of history--but the old ARMS system had problems in 
it that it didn't capture things right and all of that. As 
those things have been discovered they have been fixed. And 
NARA, the National Archives and Records Administration have 
been in, they have met with us during the transition twice. 
They have met with us three or four times since we have been in 
office. They're working with our IS&T people, and all of these 
anomalies that caused problems in the past have been fixed. 
We're comfortable that we have an adequate system right now, 
but it's not a good system.
    Mr. Rothman. Are all of the communications currently being 
saved somewhere?
    Mr. Larsen. Oh, yes.
    Mr. Rothman. And----
    Mr. Larsen. They're backed up every day.
    Mr. Rothman. And who's responsible for saving those?
    Mr. Larsen. As has always been, the IS&T staff has those.
    Mr. Rothman. And you are not yet, if I understand you 
correctly--correct me if I'm mistaken--you haven't yet fixed on 
a new system. What's the best system yet to improve things, and 
are you working with the National Archives on that.
    Mr. Larsen. That's correct.
    Mr. Rothman. Okay. Mr. Chairman, do I have time for another 
question?
    Mr. Istook. Yes, Mr. Rothman. As I indicated before, we 
have more leeway this afternoon than we were able to have this 
morning, so please go ahead.

                         FAITH-BASED INITIATIVE

    Mr. Rothman. Thank you. Mr. Larsen as my friend Mr. 
Sherwood is delighted to hear, you are submitting a flat 
budget. You've cited the level of quality of your staff and 
your own experience in order to accomplish the mission that you 
need to, but doing so on a flat budget request basis. There is 
of course more than one new initiative, but the one that I am 
most familiar with is the faith-based initiative.
    Mr. Larsen. Yes.
    Mr. Rothman. And I was wondering if that in fact comes out 
of your budget; is that correct?
    Mr. Larsen. Comes out of the White House Office budget, 
yes.
    Mr. Rothman. And could you tell us a little bit about the 
cost of that initiative or the costs to the budget? And if in 
fact there's an otherwise flat budget and there is a new 
program, this faith-based initiative which is costing X 
dollars, where is the savings coming from in your operations in 
order to pay for that new program?
    Mr. Larsen. Sure. Be glad to. Currently there's 7 FTEs or 
individuals employed in the faith-based initiative. The funding 
is actually part of the White House Office, and because we have 
a transition--the prior administration had numerous initiatives 
that they had funded through the White House Office, like the 
Millennium Council and others. Several of them went away with 
the change.
    They were funded previously, but it is a different council. 
That same amount of money just flows across. It's all part of 
the annual appropriation. And the second part of it is we 
areholding staff down. We are not up to our full 400 FTE, we're running 
at 362.
    Mr. Rothman. Thank you.
    Mr. Larsen. You are welcome.
    Mr. Istook. Thank you, Mr. Rothman.

                          WHITE HOUSE STAFFING

    Mr. Larsen, do you intend within this fiscal year to get up 
to the 400 level, or at some future time?
    Mr. Larsen. One never knows in the White House environment. 
It depends a lot on the world situation. Things could happen 
tomorrow that would require the President to immediately bring 
in, as many top level people on a particular issue as possible. 
But I think as a general rule, the tone that I'm hearing from 
the Chief of Staff is we're lean and mean and we are not going 
to be filling up the 400 just because we're authorized 400.
    Mr. Istook. Do you have a particular target that you 
believe will be the level when you achieve the normal operating 
level, as we might call it? You know, not staffing up for some 
sort of emergency circumstance?
    Mr. Larsen. No, I don't. I am not sure what that would be. 
It's too hard to predict in the White House. Too much could 
happen on the outside.
    Mr. Istook. So as far as you know right now, if we were to 
take a snapshot look at the FTE a month from now, it would 
still be 362.
    Mr. Larsen. As far as I know right now, would be right in 
that area.

                            DETAILEE POLICY

    Mr. Istook. What is the policy--I know we've certainly had 
concerns before regarding detailees, and I think Mr. Hoyer 
mentioned those briefly--what is the policy of this 
administration regarding detailees from other agencies who are 
providing staffing at the White House or the EOP?
    Mr. Larsen. First let me say I'm very cognizant of the 
regulations governing the use of detailees and other government 
employees in the White House. I was the Director of the Human 
Resources Division under former President Bush's 
administration. That is when the GAO audit of the White House 
was done, and that GAO report lays out the categories and 
criteria of different kinds of people that work at the White 
House and how they are defined.
    In terms of detailees we're following that policy exactly. 
I've met with GAO already to assure them that we're going to be 
following those policies. Essentially what it says is a person 
comes in on a detail to the White House, they are 
nonreimbursable for the 180 days, and on the 181st day it 
becomes reimbursable. This is the policy this has been in 
effect since back to, I believe, President Reagan; and we 
follow that policy.
    Mr. Istook. And are they issued the same type--for example, 
when you are trying to account for differentiating between a 
White House employee, say, and a detailee, are they issued the 
same type of passes if they're coming to actually perform their 
work on a regular basis at the White House?
    Mr. Larsen. That's correct. The pass is issued on the basis 
of where they need to work. They may get a White House pass, 
they may only get an EOB pass, just depending upon the nature 
of their work.
    Mr. Istook. Can you tell us the number of detailees that 
currently are performing their services within the White House 
or the EOP?
    Mr. Larsen. Sure. In the White House Office currently there 
are 14, and there are 9 in the Vice President's office. There 
is one in Office of Administration. OMB has 12. And I might add 
with regard to OMB, the large number of detailees for a short 
period of time during budget season has historically been going 
on for forever. Council of Economic Advisers has one. We can 
provide you with a complete list.
    Mr. Istook. Certainly. But if this is a complete list, you 
are saying that the total number of those is probably--I don't 
know what others there might be that you didn't get to--but 
probably less than 40 at this time.
    Mr. Larsen. No, it's going to be--it's going to be up 
around 100 when you include National Security Council, which 
historically has a large number of people detailed from the 
State Department and Defense.
    Mr. Istook. Okay. And again as far as the White House 
intent, and I realize the flexibility concern that you 
mentioned before, but as far as on a regular basis, the intent 
of the White House would be to have approximately the same 
number or some different number of detailees.
    Mr. Larsen. I believe the target we're shooting at is not 
to exceed 30 FTEs for the detail work.
    Mr. Istook. So right now it's significantly higher than 
that during this transition phase.
    Mr. Larsen. Excuse me. I was speaking only of the White 
House office.
    Mr. Istook. Excuse me. I was talking about whole EOP.
    Mr. Larsen. I don't believe there's a target set for that.
    Mr. Istook. Okay. And I don't recall, I didn't look up, how 
does that compare for example, with the past usages?
    Mr. Larsen. We can look it up for the record. I just want 
to caution on doing that. We tried to do a couple comparisons, 
and it depends on at what point in time during that 8-year 
span.
    [The information follows:]

Executive Office of the President--Detailees by EOP Agency as of: April 
20, 2001

                                                               Number of
        EOP agency                                             detailees
The White House Office........................................        14
Office of the Vice President..................................         9
Office of Management and Budget...............................        12
Council of Economic Advisers..................................         1
National Security Council.....................................        76
Office of the U.S. Trade Representative.......................         9
Office of Science and Technology Policy.......................         3
Office of National Drug Control Policy........................         2
                    --------------------------------------------------------------
                    ____________________________________________________

    Total.....................................................       126
    Mr. Istook. Certainly.
    Mr. Larsen. If you look at the tail end of the 
administration when a lot of the detailees have gone back, that 
gives you one type of a look. If you look at it the very start 
in 1993, they probably had a large number of detailees to help 
them get up and running. So to take, for example, say May the 
3rd for this administration and try to compare it in a 
meaningful way, I just don't know what day you would pick.
    Mr. Istook. And I am not trying to play any sort of game 
of, you know, who's using the most or such. I just want to 
understand the different approaches to management that are 
being taken so that we can understand as that relates to the 
resources that are necessary and so forth that are there. So 
perspective is all that I'm trying to have there.
    Mr. Larsen. I understand.

                      IMPACT OF NOMINATION PROCESS

    Mr. Istook. I know that there's significant concern 
regarding getting all the Administration's nominees nominated, 
approved by the Senate when necessary, and in place. Is the 
fact that that process is still underway, and evidently still 
has a long ways to go, is that impacting your budget in any 
way, your expenditures, and causing any difference between your 
expenditures as they are right now and as they may be as more 
people are confirmed?
    Mr. Larsen. No, I don't believe so. The Executive Office of 
the President is pretty well staffed. What you are seeing now 
are the folks that are being confirmed from the various 
departments and agencies.
    Mr. Istook. Is there any workload, for example, that's 
greater on anyone that is involved in assisting the nominees, 
whether it be the White House Counsel, Office of Ethics or 
anyone?
    Mr. Larsen. There is--probably the heaviest burden right 
now is on the Office of Presidential Personnel which does the 
vetting of the various candidates. I think, based on my 
experience, every administration's Office of Presidential 
Personnel comes in with a very large number and as you get 
close to the end of the first year, that number of people tails 
off because most of your positions are filled by that time.
    Mr. Istook. Okay. Thank you, Mr. Larsen. Let me yield to 
Mr. Hoyer.

                          EXECUTIVE RESIDENCE

    Mr. Hoyer. Thank you very much, Mr. Chairman. Last year, 
Mr. Larsen, we appropriated 968,000 for repairs at the White 
House and directed the Executive Residence to submit a complete 
design to the committee. What's the status of the repairs 
provided for in last year's budget, do you know?
    Mr. Larsen. I do if I can get my paper. I'm sorry.
    Mr. Hoyer. That's okay.
    Mr. Larsen. There's an ozone purification project that was 
put in; moving and packing of items and that kind of thing. Due 
to the transition, the family quarters was upgraded. There's 
about $100,000 there. The linen replacement project was about 
$150,000. The ozone purification was $100,000. Is there any 
money left over out of that $968,000 Jim, from any other 
projects? We have a complete spread. We'll be happy to give it 
to you along with what the money is requested for this fiscal 
year.
    [The information follows:]

  Executive Residence: Status of Repair and Restoration Projects for 
                            Fiscal Year 2001

    Ozone Purification Project: In FY2001 $99,780 was 
appropriated to design and install a purification system to 
improve safety and increase the efficiency of the Residence 
cooling towers. After extensive additional consultation with 
professional engineers and industry experts, the decision was 
made to install a more sophisticated automatic chemical 
treatment system as opposed to zone purification as originally 
specified. The new installed system should be effective in 
protecting the purity and safety of the cooling tower water 
while being less damaging to the existing mechanical 
components.
    Transition Impact: In FY2001 $99,780 was appropriated for 
the impact of the transition in moving and packing items for 
the outgoing First Family and setting up the living quarters 
for the incoming First Family. This project is currently in 
progress.
    Family Quarters Redecoration: In FY2001 $99,780 was 
appropriated to redecorate the family living quarters. This 
project is currently in progress.
    Linen Replacement Project: In FY2001 $149,670 was 
appropriated for replacement of Presidential Seal Napkins, 
First Family and Guest Room Linens and Banquet cloths. This 
project is currently in progress.
    Computer Modernization Project: In FY2001 $59,868 was 
appropriated for ongoing modernization of the Computer Network. 
This project is currently in progress.
    Design of Communication System Repairs: In FY2001 $456,992 
was appropriated for design and planning of repair/rehab of 
deteriorated concrete conduit (raceway) which serve the East 
Wing and the Residence. This project is currently in progress.

    Mr. Hoyer. Okay. Fine. That was going to be my next 
question, what are we doing this year. But if you have that, 
why don't you go ahead and submit that.
    Mr. Larsen. Sure, be happy to.

          SECURITY ENHANCEMENTS AT VICE PRESIDENT'S RESIDENCE

    Mr. Hoyer. Last year we provided 3.9 million to the Secret 
Service for security enhancement at the Vice President's 
residence. Do you know the status of that budget?
    Mr. Hansen. I believe I would have to yield to someone who 
was here at that time.
    Mr. Daniel. Actually, that amount would be in the Secret 
Service's budget, I believe. I don't think that amount was 
appropriated to EOP but I am not----
    Mr. Hoyer. You are correct on that. It was 3.9 to the 
Secret Service for those. And you don't know the status of 
that?
    Mr. Larsen. We don't but we could certainly coordinate with 
the Secret Service when we get back and get you an answer.
    Mr. Hoyer. That's fine.

                       NATIONAL SECURITY COUNCIL

    Would you tell me again, the National Security Council what 
are their FTE's this year? I am sorry, I am looking at your 
statement, let me answer my own question. 60 FTE's seems to be 
in your statement, page 9 of your statement.
    Mr. Larsen. That's right. Full-time permanent personnel, 
payroll personnel.
    Mr. Hoyer. This doesn't say--how does that--do you know how 
that relates to last year? Is that flatlined?
    Mr. Larsen. I believe it is a little less at the current 
time.
    I stand corrected. It is the same.
    Mr. Hoyer. It is the same. So that's both FTE's and 
dollars.
    Mr. Larsen. Dollars are higher obviously because of the pay 
raise.
    Mr. Hoyer. That takes in the 3.6 percent that you referred 
to, the 4.2 percent increase. So there is additional 
enhancement as well, right?
    Mr. Larsen. That's right. There was an adjustment in the 
GSA rental of $70,000.
    Mr. Hoyer. Where do we rent property for NSC?
    Mr. Larsen. Well, it is the GSA program.
    Mr. Hoyer. This is in lieu of, this was a SLUC?
    Mr. Larsen. Yes, this is SLUC. I wasn't sure if anybody 
around still called it that.
    Mr. Hoyer. We have a much nicer phrase than that, but I 
still remember that. I call it in lieu of payment. But 
whatever. Now, does any other agency pay that, I mean, does the 
office administration?
    Mr. Larsen. Absolutely.
    Mr. Hoyer. Throughout the White House we pay a certain sum 
for rental value?
    Mr. Larsen. That's correct. It is actually one of the 
largest components of any EOP budget.
    Mr. Hoyer. Now, there were press reports that the NSC was 
cutting their staff by a third. I take it that's not the case.
    Mr. Larsen. I don't believe they have reached that goal 
yet. What they were doing, I think there may have been some 
misunderstanding also in that story. What they are doing is 
reducing the number of personnel from other government agencies 
that have historically been assigned, so technically you can 
say that's part of their staff. But at the same time, they're 
trying to put more people actually on the payroll than had been 
used in the past. So that's why there is some increases there.
    Mr. Hoyer. I would be interested in those figures when you 
get a chance if you could. NSC O1 to O2 comparisons on that. 
Not only FTE comparison and dollar comparison, but also 
detailees.
    Mr. Larsen. I can do that.

                          WHITE HOUSE STAFFING

    Mr. Hoyer. And going to detailees I understand what the law 
says you need to do. In terms of your answers to the chairman's 
question with reference to whether or not you could be 
confident of staying at or about 362 FTE in the White House 
itself, and you indicated that that might fluctuate, depending 
upon situations that might occur, crisis, or this, that or the 
other, wouldn't most of those be covered presumably by 
detailees for given periods over time, particularly--hopefully 
the crisis would less than 180 days?
    Mr. Larsen. I think there are certainly situations where 
that would happen, most certainly. But also, things could come 
up where the President may want to establish a presidential 
initiative that may last for 2 years, like the Faith-Based 
initiative. He now has the flexibility, he could set up a small 
office of four or five people and fund it.

                         FAITH-BASED INITIATIVE

    Mr. Hoyer. You brought up the faith-based and Mr. Rothman 
asked you questions about that, and you indicated that 
obviously there were other initiatives of the prior 
administration that this administration has chosen perhaps not 
to pursue, and has taken the resources available in people and 
dollars and moved them over to this faith-based, what do we 
call it, Office of Faith-Based----.
    Mr. Larsen. Initiatives.
    Mr. Hoyer. Initiatives. Is there an item for that in the 
budget or is that included in your budget?
    Mr. Larsen. No, it is in the White House budget, and it is 
just included as part of the personnel, the salaries in the 
White House budget. And I'd like to say, with regard to some of 
the Presidential initiatives from the prior administration, 
wasn't that this administration chose not to continue them. 
Several were established in the prior administration for a 
specified period of time and they expired by operation of the 
executive order, or whatever instrument created them.
    Mr. Hoyer. Okay. But we had budgeted for them as if they 
were ongoing so the dollars are available.
    Mr. Larsen. That's correct. There's what I was trying to 
say.
    Mr. Hoyer. How many folks are in the Faith-Based Office?
    Mr. Larsen. Seven.
    Mr. Hoyer. Seven. And they're--are they in the 362 number?
    Mr. Larsen. Yes.
    Mr. Hoyer. That's where it is. All right. I have some other 
questions, Mr. Chairman, but I'll submit them for the record. 
Thank you very much, Mr. Larsen. I want to, in closing, I don't 
want you to misconstrue my comments. I expect our relationship 
to be a very positive one as my relationship was with the 
Reagan White House and first Bush White House.
    Mr. Larsen. I remember those days.
    Mr. Hoyer. Yes, sir. I really do strongly believe we need 
to work together in comity. And very frankly, I am not 
interested in the White House telling us what our budget ought 
to be, and I presume you return the favor. And seeing as how I 
don't want it done to me, I am not particularly inclined to do 
it to you. Thank you, sir.
    Mr. Larsen. Thank you sir.
    Mr. Istook. Thank you, Mr. Hoyer.
    Mr. Rothman.
    Mr. Rothman. I have no further questions, Mr. Chairman. I 
look forward to working with you and the White House to achieve 
the goals that we are all here for the best interest of the 
people of this country.
    Mr. Larsen. Thank you very much.
    Mr. Istook. Thank you. Mr. Larsen, I could pose other 
questions, but I don't think they are anything that couldn't be 
handled for the record. I don't see any need to extend the 
hearing beyond that. I appreciate the brevity of the other 
members of this. And I appreciate the straightforwardness of 
your responses and the businesslike approach that you are 
taking to this. I certainly hope that we can establish the good 
kind of relationship that we all want to have between the 
branches involved here.
    Mr. Larsen. Look forward to it.
    Mr. Istook. So thank you very much to you, Mr. Daniel. And 
we stand adjourned.

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                                            Thursday, May 10, 2001.

                    OFFICE OF MANAGEMENT AND BUDGET

                                WITNESS

MITCHELL E. DANIELS, JR. DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET
    Mr. Istook. Good morning. Calling our subcommittee to 
order. I apologize to everyone for the delays, both of myself, 
a call to the White House with the appointment for the new 
Director of the Office of Drug Control Policy and then, of 
course, we had the vote. So I wish we did not have these 
personal and institutional impositions, but I know everyone 
understands, but that does not give you the time back.
    I am pleased to welcome this morning the Director of the 
Office of Management and Budget, Mitch Daniels, who is the last 
in a long line of witnesses testifying on behalf of the 
President's fiscal year 2002 appropriations.
    And, of course, as the new Director of OMB, Mr. Daniels, we 
know it is your first time before the subcommittee. We will try 
not to bite.
    As I review the appropriations request for the upcoming 
year, I note that within the EOP, you are requesting a fairly 
modest increase, lower than the rest of government, of 2.7 
percent. We appreciate the effort to lead by example with the 
President's desire to restrain spending and we certainly 
applaud your efforts to manage effectively the resources of 
OMB.
    We have discussed some things informally earlier. We 
understand your desire to do some consolidation of accounts, 
which I am uncertain as to how that might be treated by the 
Congress, but I share the goal of achieving economies of scale 
and making sure the President has the ability to organize the 
people that work directly with him in the way that he sees best 
and to achieve the efficiencies that I know you want.
    I want to touch on some broad concerns before we get 
underway. Certainly, of course, OMB has a very unique role, a 
central role, regarding the oversight of federal agencies, not 
only in respect to the budget, but in respect to management.
    Now, I have spent a great amount of time reading different 
things regarding OMB's management responsibilities and it is 
clear there is an inherent tension between when you focus on 
the budget and when you focus on management issues: We 
certainly know that when you have a brand new Administration 
with immediate budget requirements and, of course, a lot of 
focus is going to go there at the first part of the term. But I 
am concerned as to whether the necessary oversight of the 
management part is going to be handled.
    It is not something that I think we ought to be debating, 
but it is something that relates to your personal style and 
your delegations of which gets the most focus. There is a great 
need for better management oversight and certainly in the area 
of information technology. The OMB has very specific 
responsibilities, statutory responsibilities, which basically 
give it superintending control over federal information 
technology investments, which is in the tens of billions of 
dollars each year. We have significant amounts in this 
subcommittee and I think that is one of the places where OMB 
can best contribute to help with management. But still, I 
think, an area of weakness within OMB is management efforts, 
which we hope that we can assist you in strengthening.
    In addition to the budget concerns, oversight and federal 
regulations, there is specific authority for the OMB relating 
to reviewing regulations that come forward. There is one in 
particular that I want to bring up and discuss with you which 
is pursuant to former President Clinton's Executive Order 
13166, which has sparked a whole flurry of regulations. They 
are very interesting regulations because nominally they claim 
to be policy guidelines. They are not. They are actually the 
imposition of regulations and rules upon society, which is 
plain from a reading of them, and it was clear when we had GSA 
in here this week that they are not internal policy guidelines. 
It is just like you took a regulation and put a different label 
on it and expect that that is going to pass muster.
    I have reviewed the statutes, I have reviewed the pertinent 
executive orders regarding OMB's authority and to me it is 
extremely clear that it is within the realm of OMB's and OIRA's 
areas of responsibility, which I think has been escaping a lot 
of notice, which I will get into after we receive your 
testimony.
    But regulatory oversight is a key responsibility of OMB. I 
think that is an excellent test case with this particular 
executive order and the multitude of extremely burdensome and 
expensive regulations that have been issued pursuant to it.
    Finally, I want to highlight our concerns regarding the 
President's proposals on law enforcement within the Treasury 
Department. In the testimony by the Secretary of the Treasury 
and with the individual law enforcement bureaus, we covered 
this. I am concerned about the absence of any specific funding 
for the Treasury Department's role and the Secret Service and, 
in particular, in the upcoming winter Olympics, which has been 
designated as a special national security event.
    It is especially interesting when you compare the law 
enforcement within Treasury, which is, I believe, approximately 
40 percent of the overall federal law enforcement, with the 
other law enforcement budgeting in the President's proposal. We 
have a couple of charts here.
    Over the past 14 years, as this chart illustrates, funding 
for the Department of Justice and its related law enforcement 
has increased 139 percent, but at the same time funding for 
Treasury law enforcement has increased by 47percent.
    If you look at employment levels, you will see the same 
disparity on the second chart. Justice personnel have increased 
by 49 percent over this period of time and Treasury law 
enforcement personnel have increased by 8 percent.
    Looking at the third chart, if we were to compare just 
Customs and INS, which, of course, have complementary 
responsibilities between controlling the border and controlling 
the immigration and naturalization process, there are similar 
growth patterns. Funding for INS increasing by 244 percent, yet 
for Customs by just 35 percent.
    The final chart is personnel. INS has seen an increase of 
80 percent in its FTEs since 1989, Customs 5 percent.
    So, Mr. Daniels, I bring the historical reference to your 
attention because it seems to me that there is still a 
disparity in the President's budget. That may relate to actual 
priorities, it might relate to some differences in some 
internal processing that perhaps ended up with an unintended 
disparity, but in any event it is fascinating that the special 
funding for the Winter Olympics security issues is contained 
expressly within the DOJ proposed budget, but not within the 
Treasury Department's law enforcement budget. That is troubling 
because it is a challenge for the Treasury agencies to absorb 
the cost to the tune of $52.6 million in fiscal year 2002. So 
we certainly want to get into that as well.
    I know those have been a little bit long remarks, 
considering the late start, but I have nevertheless tried to 
shorten them and I know that these issues are indeed, Mr. 
Daniels, of concern to you. It is something that we want to 
achieve, a level of cooperation and mutual agreement and comity 
in resolving those, as well as things that may be on your plate 
that perhaps you think we are not paying sufficient attention 
to. I certainly recognize and OMB has had testimony before this 
Congress pointing out that sometimes Congress criticizes OMB 
for not getting a good enough handle on regulations, when a lot 
of the regulations trace back to actions by the Congress itself 
or sometimes inaction by it. That is why I think it is 
important that we have mutuality of understanding and of 
sharing a common goal to reduce the burden on the American 
public and, frankly, reduce the spending burden that it creates 
for the agencies under our charge as well.
    So let me recognize Mr. Hoyer first and then we can receive 
your testimony.
    Mr. Hoyer. Thank you very much, Mr. Chairman. I want to 
welcome the Director to this hearing and welcome to the 
committee. I am sure we will be working very closely together 
in the coming years.
    O.M.B. is requesting a very modest $2 million increase. To 
that extent, it is within the framework of that which it is 
setting for the rest of the executive branch. However, as the 
director knows from our conversations, I believe that these 
government-wide levels are insufficient to provide the services 
that the American people expect.
    I am going reference at some of the agencies under our 
jurisdiction, Mr. Director. The Treasury budget is not 
sufficient, in my opinion, to fund inflationary costs necessary 
to maintain current operating levels if you take out IT, which 
is a dedicated objective.
    The Customs modernization project known as ACE is flat 
lined. With the current stream of funding, the development of 
ACE could take up to 14 years to complete. Secretary O'Neil 
observed that he did not think that was the most efficient way 
we ought to proceed. He was not referring to that specifically, 
the general concept of if you are going to do IT and you think 
you have the right program, the Secretary's view was you ought 
to go ahead and do it. I agree with that.
    Not only will the costs increase to develop the ACE system, 
it puts the legacy system, in my opinion, in a position to 
crash and immobilize trade in this country. Congress is going 
to be talking a lot about free trade. As you know, Mr. 
Director, I am one of those Democrats who has voted pretty 
consistently for NAFTA, GATT, Fast Track and PNTR, but you have 
to have a system that accommodates it as well.
    No funding is included for Treasury and law enforcement 
efforts for the winter Olympics. We could argue about this 
chart, up or down, and I think the Chairman makes a good point 
on these charts, but the fact of the matter is we all knew the 
2002 Winter Olympics was coming and there is no funding in the 
budget. The irony is that there is funding for the FBI, so that 
while they were funded for this, the Treasury Department was 
not.
    The first accounts program, a small program which was 
established to provide low income workers with greater access 
to financial institutions, is zeroed out, and although it is 
small, it is a very significant outreach program to try to 
empower people. I think that is absolutely good talk. I think 
we ought to empower people, whether it is by giving them more 
of their money back or whatever it is, this is an effort to 
empower people.
    The administration has continued the trend of under funding 
the courthouse request at will. As I have discussed with you, 
this is a bipartisan administration activity, the Clinton 
administration did it as well. I am, very concerned about 
whether or not we can plus up the program so we can do what is 
critically necessary to enforce laws, and to have criminals 
indicted brought to justice and off the streets. We need to 
provide places for that to be done.
    I am also concerned about how federal employees are treated 
in the fiscal year 2002 budget. The budget assumes a 3.6 
percent pay raise, as you know, Mr. Director. This is, however, 
in my opinion, inconsistent with FEPCA, the Federal Employee 
Pay Comparability Act, which, by the way, was passed in this 
committee in 1990 and signed by President Bush. I worked very, 
very closely with Connie Newman of the Bush administration on 
that legislation, so it was a bipartisan piece of legislation.
    In addition, it is inconsistent with the military pay raise 
of 4.6 percent. As you know, the law says that there ought to 
be parity between Federal employees and military employees.
    The budget also proposes to delete language that ensures 
contraceptive coverage for federal employees. I am not 
surprised at that, but that is going to be a bone of contention 
here.
    The budget also makes reference to a plan to, and I quote, 
``reduce the number or layers in the upper echelons of the 
government.'' However, there are no details provided as to how 
that is going to be done. Hopefully, we can flesh that out.
    Mr. Daniels, the concerns I am raising I think are 
notpartisan concerns, although in time we will debate them in partisan 
terms, I think, and many of them are not new. I have also expressed my 
concern over Treasury law enforcement, courthouse construction and 
federal pay, as I said to previous administrations.
    With the possible enactment of a large tax cut, I am 
concerned that funding for these essential activities and 
things that I think we are agreed are essential activities, and 
other priorities like education will be unavailable in the 
future. In my opinion, we need to pay down the debt, invest in 
our people, our programs and infrastructure, or we will be 
facing the same problems we faced in the early 1990s, huge 
deficits and crumbling programs.
    Mr. Director, we had a good discussion in my office. At 
least you learned what I had to say and I look forward to 
sitting down and listening to you at this hearing.
    But first, let me read two paragraphs, if I can, from the 
book that I have referenced. This is David Stockman's book 
Truth in Politics, as he looked back on his term as OMB 
director. Page 12 in the prologue to his book, ``I have been 
flooded with new evidence about the course of the economy and 
the resourceful intransigence of congressional politicians.'' 
He meant congressional politicians on both sides of the aisle 
he thought wanted to spend too much money.
    ``I knew we were on the precipice of triple-digit deficits, 
a national debt in the trillions, and destructive and profound 
dislocations throughout the entire warp and woof of the 
American economy. By then, all the major errors which would 
eventually shatter the nation's fiscal stability were 
apparent.''
    That has to be pretty chilling. He is talking about, of 
course, 1981.
    ``I had most of the diagnosis down already. It was only the 
full and final magnitude of the numbers that would materialize 
later. But I kept quiet and tried to work inside. It proved to 
be of no avail. After November 1981, the administration locked 
the door on its own disastrous fiscal policy and threw away the 
key. The president would not let go of his tax cut. Cap 
Weinberger hung on for dear life to the 1.46 trillion defense 
budget. Jim Baker carried around a bazooka, firing first and 
asking questions later of anyone who mentioned the words Social 
Security. Deaver, Meese and others ceaselessly endeavored to 
keep all the bad news out of the Oval office and off the tube. 
The nation's huge fiscal imbalance was never addressed or 
corrected, it just festered and grew.''
    The conversation that you and I had, Mr. Director, was 
about what I think is an awesome responsibility that you have 
and that is to tell the president the truth. Dick Darmon, I 
think, told President Bush the truth. It may have cost him the 
presidency, but in my opinion, President Bush's father did the 
right thing in 1990. In 1990 and 1993 and 1997--1993 in a 
partisan way, 1990 in a bipartisan way, and in 1997 in a 
bipartisan way, the Congress acted with the president, in my 
opinion, to provide the surpluses that we have that give us the 
opportunity to pay down the debt, save Social Security and 
Medicare and invest in some of the programs that I think all of 
us want to invest in.
    The president says he wants to leave no child behind and he 
wants to defend America. I agree with him on both points.
    You have an awesome responsibility and speaking truth to 
power will be one of your most awesome responsibilities. I 
welcome you to the committee and I wish you the best as you 
undertake these responsibilities and look forward to working 
with you.
    Thank you, Mr. Chairman.
    Mr. Istook. Thank you, Mr. Hoyer.
    Mr. Daniels, it is our practice to swear the witnesses and 
then have your testimony.
    [Witness sworn.]
    Mr. Istook. We have your written testimony for the record. 
It will appear in the record in its entirety, so I always 
encourage witnesses to feel free to be extemporaneous, if they 
prefer, in their comments. We will be happy to hear from you.
    Mr. Daniels. I see no reason to spend the Committee's 
scarce time on my testimony. I hope it is self-explanatory and 
each of these two terrific opening statements touched on pieces 
of it, so maybe somebody has even read it already, I do not 
know. But I think in view of the time, I would be happy to move 
directly to your questions, if you prefer.
    [The information follows:]

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    Mr. Istook. That is unheard of, Mr. Director.
    Mr. Daniels. I screwed up again. Oh, no. [Laughter.]
    Mr. Istook. I was not timing you, but that was probably 
under 30 seconds.
    Mr. Daniels. I am still learning, Mr. Chairman.
    Mr. Istook. Do not run for the U.S. Senate. [Laughter.]
    Mr. Istook. Now I am going to hear from the senators. Okay.

  E.O. 13166, ``Improving Access to Services for Persons with Limited 
                         English Proficiency''

    Thank you. Mr. Daniels, let me start on the one thing that 
relates to the management side and the regulatory side of OMB. 
We know there has been a great amount of consideration by the 
Bush Administration--whether it be last-minute or last-year 
activity by the former Administration and that is a political 
hot potato, we understand that. There is a particular one that 
I think has not been on people's radar screens but I have 
become increasingly aware of it, especially during the last 
week, and that is the consequences of President Executive Order 
13166, which was issued in August of last year. I think because 
there was so much media focus on the Democratic National 
Convention at the time, perhaps it did not receive the 
attention then.
    Immediately with the issuance of the Executive Order 
camethe issuance of so-called policy guidance statements by the 
Department of Justice and published in the Federal Register. After 
that, of course, federal agencies were directed to prepare their own. 
They did.
    Almost all of those occurred before the inauguration. 
However, in the case of the Department of the Treasury, theirs 
were published in the Federal Register on March 7th of this 
year. And the first time it was brought up in any of our 
hearings was yesterday with the General Services 
Administration. I read to them from the laundry list contained 
in their own internal policy guidance, as it is called, which 
imposes obligations on anyone who is involved in an assistance 
program with GSA, which includes a ton of non-profits around 
the country, and it includes for-profit entities. I thought it 
was fascinating that, among other things, it says people who 
operate the vendor stands which are done by the blind 
nevertheless are under a requirement to provide not only but 
written translations of documents into foreign languages.
    That is the stated purpose of these regulations, because 
that is what they are, to impose a requirement, as the 
Department of Justice guideline says, really on anyone who 
contracts with the federal government as well as those who 
receive some form of federal assistance in the form of grants 
or otherwise. It even, for example, expressly includes those 
who participate in the Americorp program, the organizations 
that are involved with it.
    And I do no think anybody has done a calculation at this 
stage of how many untold millions of dollars, millions of 
manhours will be caught up by this requirement that says if you 
have persons with limited English proficiency with whom you are 
doing business because you have received some sort of 
assistance or contracted with the federal government now you 
come under this requirement, which is burdensome, it is vague, 
and it imposes an untold cost on businesses and individuals 
throughout the nation. Nobody seems to have calculated that, 
which is the purpose of a lot of the oversight by OMB.
    Under the normal protocol, both statutory and by executive 
orders, OMB should have reviewed those regulations before they 
were issued. I mean, calling it a policy guidance statement 
does not make it one. That is kind of like saying, you know, is 
is not is, just changing the label on it. And I believe the 
statutes and the executive orders are sufficiently clear that 
it does not matter what you call it; what matters is the effect 
of it.
    Since these were not reviewed before they were issued, they 
were not reviewed by OMB in the prior Administration, some of 
them have been issued during this Administration, again, 
without OMB's involvement in assessing the burden. I thought 
that would be a good place to start with whether OMB is taking 
any active role to take charge of this burden that has been 
placed, and make a determination of whether these should be 
rescinded as I believe they should. I would certainly like the 
Administration's opinion because one bottom line thing that I 
have not mentioned is that these were predicated on an 
interpretation of the law which has been overturned by the U.S. 
Supreme Court in the past month, in the Alabama Sandoval case.
    Now, I could go on and I could read to you from some of 
these, even the Transportation Department regulations, which 
seems like they are saying to Departments around the country, 
you might better look at not putting signs up in English, but 
putting them up in symbols instead for traffic signs around the 
nation. They go into that much detail and that much degree.
    Before I go any further, I really should give you a chance 
to tell us about the Administration's and OMB's policy and 
whether anyone has measured the federal resources through you, 
through these agencies that are involved in issuing, 
interpreting and enforcing these regulations and the burden on 
the nation.
    Mr. Daniels. The honest answer to the last question is no, 
there has not yet been a measurement of costs imposed. I think 
that is only one of several important concerns that this 
situation surfaces and you just named, I think, most of them, 
Mr. Chairman. They are both substantive and procedural.
    The intention of the Administration is to leave the 
executive order in place, but to scrutinize very carefully the 
actions taken underneath that Executive Order, both as to their 
substance and possibly to their form. You, I think, raised a 
question that does need a look, which is whether the 
administrative requirements of our law have been fully observed 
and perhaps even, for all I know, some congressional 
prerogatives usurped in the process. All of that is going to be 
under active review.
    You are correct that as far as I know just one department's 
so-called guidance emerged since January 20th, but one could 
well be too many if it is later determined that it was flawed 
or excessive, so we will be looking at it very carefully with 
an eye both to the law that ought to govern in this area and 
also to the process in the situation so far.
    Mr. Istook. You state that the Administration's intent is 
to keep the Executive Order in place. Of course, I have keyed 
on the administrative ones, but the Executive Order is what set 
off these responses by the federal agencies and I frankly 
wonder if it is consistent to have an Executive Order telling 
them to issue things and then saying, ``but we disagree with 
the fact that they have issued them.''
    I frankly wonder if this is an Executive Order which the 
current Administration might see fit either to rescind or 
amend, whatever it may be. I hope that attention is being given 
to that. But this whole thing kind of brings up the issue of 
what are the current priorities--and I understand the immediate 
budget situation--but what are the current priorities of OMB 
and how is that reflected in what you have or have not done in 
this area of your responsibility?

                        OMB's Management Agenda

    Mr. Daniels. Thank you, really, for raising what I believe 
is one of the most important questions about our stewardship of 
this agency. I am very determined that the budgetary 
responsibilities, which are probably the first that most people 
associate with our work, not consume and devour management 
attention and, agency energy during President Bush's 
Administration. We will soon be sharing with Congress and the 
public an ambitious management agenda, much of it marked off by 
the President during his campaign for the presidency, other 
pieces of it drawn from the excellent work of our predecessors, 
of GAO, and of congressional oversight committees, about areas 
of special urgency for better management in the Federal 
government.
    We have prepared an agenda for ourselves that we intend to 
hold OMB accountable for. We have prepared a menu of what we 
believe are important management opportunities department by 
department, which I will be sharing with the cabinetnext week. 
So we take that very, very seriously.
    Likewise, we have the related responsibility for regulatory 
review, which we intend to be thorough, grounded in the best 
science and the best economics possible. We believe we have 
recruited a first rate person to lead that regulatory effort 
and we hope to see that person confirmed and in the job very 
quickly.
    Mr. Istook. Let me ask one final quick question because I 
need to yield to the other members of the subcommittee.
    The pending efforts, as you mentioned, on management and 
the focus and the changes that it may bring about, do you 
anticipate that that will cause any revision of the budget 
request that is before this subcommittee or, for that matter, 
before any of the other subcommittees?
    Mr. Daniels. No, I do not. I think we can and will live 
within the requests that we have made. The quality of the 
workforce at OMB is very high, in my opinion. It can always be 
better, but I think the career professionals there are folks 
that the American taxpayer ought to be very proud of. We have 
nearly 500 on board, the budget would make possible 527, so 
there is a little room for more personnel as we may need them. 
More management attention than it is resources.
    Mr. Istook. Thank you, Mr. Daniels.
    Mr. Hoyer.

             Federal Employee Pay Comparability Act (FEPCA)

    Mr. Hoyer. Thank you very much, Mr. Chairman.
    Director, let me concentrate to begin with on the Federal 
Employee Pay Comparability Act and I am going to ask a series 
of what are relatively straightforward questions. We obviously 
have a timeframe for questions. You may not have, I understand, 
specific answers to each question, but to the extent you can, 
either give your answer now or submit them for the record.
    As I discussed, we passed the Federal Employee Pay 
Comparability Act in the Treasury Postal Bill for fiscal year 
1991 in 1990. I worked with Connie Newman, then director of the 
OPM, President Bush and, Ed Meese, who was very, very helpful 
in working on federal employee issues.
    Let me ask you, do you agree there is a pay gap between the 
federal and non-federal pay?
    Mr. Daniels. I am not yet clear, Congressman. I have been 
reading the history and the data provided by the system we have 
in place now. It seems to be in some conflict and there is 
obviously some difference of opinion about the reliability of 
the methodology. But I am aware of the range of estimates here. 
I just confess I am still not able to tell at this point which 
ones to trust.
    Mr. Hoyer. That, by the way, position is consistent with 
almost all of your predecessors with whom I have discussed this 
matter. But, as you know, the Federal Salary Council says there 
is a 25 percent, almost 26 percent disparity between private 
sector and public sector pay around the country. Are you aware 
of that report? Have you had an opportunity to see that?
    Mr. Daniels. Well, I have seen a range of estimates that 
appear to differ somewhat, but they are in that ballpark. I 
have seen 17 percent, I believe. That is another number I am 
familiar with.
    Mr. Hoyer. At some point in time, you will have to provide, 
in August and in November, some advice to the president with 
regard to the Federal Employee Pay Comparability Act. Will it 
be your advice to follow the Federal Employee Pay Comparability 
Act?
    Mr. Daniels. I hope you will not be surprised if I say it 
is too soon for me to know to tell you that, Congressman. It is 
a very fair question. I made only in recent days the delightful 
discovery that I am a part of something called the federal pay 
agent, a further wonderful distinction of this job I have come 
into. I am really looking forward, very honestly, to the 
deliberations of that group because this is a fascinating 
subject and I have a lot of questions about the way we do this 
as well as the gap that may be there and, obviously, the big 
question, what do we do about this after we have agreed.
    Mr. Hoyer. Right. And I am hopeful that we can agree. I 
have told every one of your predecessors, as I told you in my 
office, that if you do not believe that the pay agents systemic 
treatment and analysis of the disparity, is correct, show me an 
alternative system and I will probably be in agreement with it 
because I am convinced that it will show, whether it is 17 
percent or 25 percent, a substantial disparity which we have 
not been meeting.
    Let me ask you, do you believe the country is facing 
serious economic conditions affecting the general welfare to 
the point that the law cannot be followed?
    At this point, if you were making that advice, have you 
made any conclusion as to whether or not the waiver provisions 
of the law would be applicable today?
    Mr. Daniels. No, I have not. I am aware that the law does 
circumscribe the conditions under which waiver can occur and I 
am also aware that that finding has been made repeatedly by 
previous Administrations, but I am not yet ready to say whether 
I think, in all honesty, it can be said about this year.
    Mr. Hoyer. I had a significant disagreement with Director 
Raines, Panetta and others as to whether or not when you had a 
surplus that you could qualify under that waiver. My 
presumption is that we are going to have surpluses and it seems 
to me difficult under that scenario, because the language was 
adopted when we had, as you know, those triple-digit inflation 
numbers of which former Director Stockman wrote.
    Mr. Daniels. Well, just to differentiate for a moment, I 
think that the law speaks of economic circumstances.
    Mr. Hoyer. Yes, sir.
    Mr. Daniels. As opposed to fiscal. Fiscal difficulty often 
coincides with economic difficulty, but not always. In other 
words, we had a roaring economy with fiscal deficits at one 
point and at the same time one could imagine, for instance, a 
concern about inflation, even when the fiscal circumstances 
were currently strong. I just wanted to refine that point.
    Mr. Hoyer. As a member of the pay agents just let me make 
an observation. I know I am running out of time, Mr. Chairman, 
that we have specifically constructed the statute so we do not 
add to inflation in the sense that the federal employees follow 
the private sector. And, in fact, it is ECI, which is the 
Employment Cost Index for the private sector, less a half a 
point. We specifically built into the law that the federal 
employees will get less than the ECI adjustment in the private 
sector.
    Mr. Chairman, I have some other questions. I am sure I have 
run out of time and I appreciate you extending the courtesy of 
asking those questions. I will come back during thesecond 
round.
    Mr. Istook. Thank you, Mr. Hoyer. I regret that we are not 
going to have as much time today as we would all like to have.

                 Federal Employee Pay Comparability Act

    Ms. Northup.?
    Ms. Northup. Thank you.
    Following up on the previous questions, the pay 
disparities, do they take into consideration the entire benefit 
package, including the job protection merit employees have, the 
retirement benefits and so forth?
    Mr. Daniels. They do not. Now, my limited reading of this 
does, I think, reflect--I can say confidently that that is one 
question that can be asked about the comparisons that are made. 
They are not taking into account sort of the all-in costs or 
all-in benefits of public versus private employment and there 
are other questions. I am especially curious about the whole 
matter of grade leveling, both the difficulty that they seem to 
have experienced in doing it, maybe the imprecisions in what 
they found, also the fact that it is supposed to take so darn 
long before this particular piece of the computation is final.
    And so I think there are big questions about the methods 
which I look forward to learning more about.
    Ms. Northup. Well, I have become increasingly concerned 
about the employee benefits and reimbursement levels. Quite 
honestly, I think that in many case the public sector pay has 
fallen behind private sector, even if we increase it at the 
cost of living increase, the fact is the cost of living has not 
been rising so fast, but private sector pay has been rising 
more quickly because of the increased productivity.
    On the other side, it seems to me that so often public 
employees' benefits are to some degree constrained by our years 
of early retirement benefits that often are not matched in the 
private sector and this is becoming an enormous cost, 
considering that most Americans are living longer, many are 
working longer, we are actively considering extending at what 
age you are allowed to retire, at the same time we keep seeing 
bills being introduced that would allow public employees to 
retire earlier with fewer years of service. And we all 
understand that years ago this was done because people did die 
at an earlier age, but today as Americans are living longer and 
healthier lives, it seems to me like public employees, whether 
we are talking about teachers or what area we are talking 
about, that the cost to the governmental unit that pays is 
enormous because of retirement benefits and fewer years of 
service before those retirement benefits are able to be drawn 
down, and at the same time the year-to-year pay has failed to 
match what it ought to match.
    It is harder for us to attract good teachers, public 
employees and to their credit they are concerned about their 
pay because during the years they are working, they still pay 
the same amount for a house, for a car, for what they buy.
    So it seems to me like we have two problems in this, the 
question of pay and the question of benefits that ought to be 
looked at.
    Mr. Daniels. I think those are quite excellent points, 
Congresswoman, and I would only observe further that the entire 
framework for this discussion may or may not suit the age in 
which we now live. It may have been well designed in 1990, but 
I come most recently from well over a decade in a company that 
worried a lot about pay and the starting point was always to 
look, really, job by job, at what we were trying to accomplish, 
who we were trying to recruit and retain and what the market 
was for those particular skills. And it was changing all the 
time.
    And I guess an overall predisposition I bring to this whole 
subject is that flexibility is sadly lacking in the entire 
federal personnel system. This goes not merely to pay and 
benefits, but to the entire way in which we attempt to recruit 
and get the best out of the skills and the people we bring in. 
And it could be that we will always struggle to perfect a 
system which attempts to establish sort of one giant formula, 
one size fits all, generate answers that we are all comfortable 
with and have confidence in.
    I think the answer may well lie in the other direction, 
which is to dramatically enhance the flexibility of federal 
managers to pay people and to manage them in a way that suits 
the task.
    Ms. Northup. Well, you know, that would sort of coincide 
with the view by many economists that while the United States 
has increased productivity because of computers and able to 
adjust--the private sector, able to adjust, whereas Europe, 
they may have the computer capability, they may actually have 
it, the abilities of companies to down size, to really cut 
costs because of their productivity has been lacking.

                             Privatization

    Let me ask one other area of question and that is my 
concern with the questions of privatization. I see sort of two 
sides of this. One is I saw a number of times in the last 
administration where in an effort to show fewer employees 
private contracting was done with just the fewest benefits. For 
example, the security services at the federal building in 
Louisville, no benefits, no health benefits, none of the things 
that every federal worker would expect.
    On the other hand, I happen to be a supporter of us 
contracting out when there are benefits to be gained, when we 
serve the American taxpayer and the American public at large 
better.
    I see a growing number of cases where federal employees and 
federal agencies are initiating competition with the private 
sector. Just offhand----
    Mr. Istook. Ms. Northup----
    Ms. Northup. Yes?
    Mr. Istook. I hate to interrupt you----
    Ms. Northup. Yes. My time----
    Mr. Istook. Continuing. But since our time is so limited 
today, I need to ask that.
    Ms. Northup. Okay
    Mr. Istook. I think the Director, I am sure, has understood 
your remarks.
    Ms. Northup. All right.
    Mr. Istook. Thank you.
    Ms. Northup. Can he respond?
    Mr. Istook. Yes.
    Mr. Daniels, if you want to respond, please go ahead.
    Mr. Daniels. I will respond briefly by saying that a drive 
to--I would say reinvigorate competition in the provision of 
public services will clearly be near the top of the management 
agenda that I talked about earlier. This was a consistent theme 
of the President and most, I think, scholars of good government 
for a long time and for whatever reasons, and the reasons do 
not matter, there has been a lot of momentum lost in this area 
in recent years.
    There is an enormous opportunity under conditions 
ofcomplete fairness which have to be ensured for the incumbent public 
employees for competition with all the productivity enhancing, cost 
reducing, customer pleasing effects that competition tends to have to 
be brought to that huge unexploited part of the federal inventory of 
activities which has already been marked off as ripe for competition. I 
am not convinced that inventory is as big as it could be, so this will 
be a major theme. And I also take your point about the sort of inverse 
situation of we have to be careful about federal or governmental 
activities competing with the private sector unless those competitions 
also are non-subsidized and fair.
    Mr. Istook. Thank you.
    Mr. Rothman.
    Mr. Rothman. Thank you, Mr. Chairman.
    Director Daniels, good to see you.
    Mr. Daniels. Yes, sir. You, too.

                         Secure Our Schools Act

    Mr. Rothman. And thank you for coming here and giving us an 
opportunity to ask you some questions.
    Before I had the privilege of being elevated to this 
Committee, I was on the Judiciary Committee and, as you know, 
that is a committee where the folks there do not always agree. 
They express their opinions in very strong, strident terms, and 
it is very rare that there is agreement on either side, one 
bringing a few votes to either side's position. However, there 
was a bill that Chairman Hyde and I put forth called the Secure 
Our Schools Act. It was enacted into law under another 
provision, but it made its way out of the Judiciary Committee 
unanimously and then it got to the floor and was voice voted 
and included in the Victims of Trafficking and Violence 
Protection Act.
    The Secure Our Schools Act was for $30 million a year for 
three years specifically, narrowly focused on a matching grant 
program so that if a local school felt that they had the 
problem of guns or weapons in their schools and they wanted to 
put up half the money for metal detectors or training of 
security personnel or security cameras, the federal government 
would put up the other half. If they could not afford it, we 
would pay for it. Not a mandatory program, purely voluntary, if 
the school board felt they needed the help.
    And so it passed unanimously out of the Judiciary 
Committee, and former Chairman Hyde and Chairman Sensenbrenner 
and I and others sent a letter to you on March 7th and you were 
kind enough to respond in your letter of April 4th. And while I 
appreciate that President Bush and the administration, as you 
say, includes over $300 million to help our young people from 
gun-related crimes, most of the money goes to other things: 
child safety locks or for task forces or for school resource 
officers.
    The Secure Our Schools Act request of $30 million a year 
was focused narrowly on metal detectors and those kind of 
security devices in a matching grant program.
    Now, we all voted for this in the Judiciary Committee and 
then on the floor of the House, a voice vote, because this is 
not an urban problem or suburban problem, it is a problem 
affecting the whole country. And children have written to me 
countless times saying they were afraid to go to school. And I 
was hopeful--and am hopeful--that you can find some money in 
your budget to meet this need. Certainly it is my highest 
priority, and I know the Judiciary Committee and Chairman 
Sensenbrenner and Mr. Hyde and others feel the same way, that 
we can get funding for this program. It has a very narrow focus 
of metal detectors because so many of the crises that we face 
in the schools where kids have brought guns and weapons into 
schools would be eliminated if there were metal detectors at 
the door and not every school system can pay for it and that is 
why I hope you will find money for that in the budget.
    Mr. Daniels. Thank you, Congressman, and it was an 
impressive bipartisan group of people that supported that 
particular approach. I mean, here is clearly an area in which I 
am sure everyone present and everyone not present shares the 
objective in mind.
    As you pointed out, the budget as submitted increases 
rather significantly the total amount of money aimed at this 
general problem. We believe that the problem can be approached, 
including through the means that your bill is very specifically 
aimed at, through a variety of other programs and we have tried 
to increase the flexibility with which schools and also local 
law enforcement can access federal funds to match the available 
money to the specific needs they have and I know in many cases 
metal detectors is exactly the need; other schools may, 
however, find that an extra officer or some other program would 
be better suited.
    Mr. Rothman. I understand. If I may just follow up very 
briefly, I understand that, but as I have read the description 
of the other programs and their focus, it is not on metal 
detectors and security cameras. It is on other things. And 
since there was this strong bipartisan message given by the 
entire House of Representatives, the whole Congress and signed 
by the president, on just this narrow range, I was disappointed 
that there was not a penny allocated for this specific program, 
which in all of our minds is really going to solve the problem 
more directly and, you know, with 88,000 public elementary and 
secondary schools, we need all the help we can get. I am 
hopeful that you will be able to find some money for this 
program.
    Mr. Daniels. Well, we very well may and you will certainly 
find the President and the Administration very flexible about 
the means of achieving common objectives and this is an 
excellent example of that. We will obviously be mindful of 
total spending and keeping within some restraint there, but 
particularly where the objective is as much a universal one as 
this one, we will be glad to work with the relevant people and 
committees on the means.
    Mr. Rothman. Thank you.
    Mr. Istook. Thank you, Mr. Rothman.
    Mr. Tiahrt.
    Mr. Tiahrt. Thank you, Mr. Chairman.
    Welcome to the committee, Mr. Director.
    Mr. Daniels. Thank you, sir.
    Mr. Tiahrt. Mr. Hoyer brought up the pay discrepancy, the 
25 percent, and I think Ms. Northup talked about some of the 
differences. I guess the private sector is really market 
driven, based on performance and productivity and some risk in 
the job, which we currently do not have any measurement, do we, 
of productivity in government service? Do we have any metrics 
at all that we can measure how jobs are being done? Because I 
think if there was something where we could have some type of a 
yard stick, we might have more justification for increasing pay 
for government workers. Is there anything that you know of now?

                   Budget and Performance Integration

    Mr. Daniels. Very, very few such measurements exist. The 
number one management objective of the Administration at the 
very top of the list that we will be working off is the 
measurement of performance in government programs and 
ingovernment activity and eventually its linkage to the resource 
allocation process.
    Now, this will be the single most complex thing we deal 
with and I am under no illusions that major gains can come 
quickly, but we have to start somewhere and some time and 
every--I think on a bipartisan basis, every relevant committee 
of Congress has urged that this occur, the framework is in 
place through some legislation passed during the 1990s and it 
is really time to utilize that framework and this is the first 
objective we will have.
    Mr. Tiahrt. I know from dealing with education in the state 
of Kansas, the average teacher there makes in the low 30s. The 
average worker at the Department of Education is in the low 
50s, some significant amount higher. Yet I would argue that 
most productivity is in the classroom. So somehow there ought 
to be some kind of measurement to see what is going on around 
the country and see if there is a metric that we could apply.
    But when I talk about the Department of Education, it 
reminds me that we need also some metric when it comes to 
accounting in our government agencies, some way of determining 
whether we are getting a good job done for the amount of money 
we are investing or not, because right now the Department of 
Education cannot account for some $500 million and there is 
just no good best practices accounting system available. Are 
there any plans to convert the existing system to some system 
that could be a good management tool to see if you are on 
schedule, to see if you are on budget, to see if there are any 
performances? I do not know of anything going now. Do you have 
some idea of what it in the works?
    Mr. Daniels. My fear is there is too much going on and I 
will explain what I mean by that. I think this is a subject of 
great concern in various departments. I take your question to 
range beyond just the Department of Education, although that is 
a graphic example.
    There are efforts, as you know, underway in virtually all 
departments to improve financial management. There have been 
some real successes and there have been some very conspicuous 
failures. There is a very closely related effort which we will 
pursue vigorously to bring overall information management to 
the activities of the Federal government. There will be really 
more than one person at OMB acting as Chief Information Officer 
of the Federal government. I say more than one because this 
will be a principal assignment of the Deputy Director for 
Management, a job we are going to attempt to elevate as high as 
we can, and at least one person working solely on the question 
of information systems reporting to that deputy.
    When I say there may be too much going on, I am really not 
being facetious. What I mean is that with a variety of flowers 
blooming, $45 billion scheduled to be spent on information 
technology across the government this year, I am concerned and 
we want to get a handle on it to make certain that in an 
attempt to make an individual department or part of a 
department better we are not just further proliferating 
inconsistent systems, non-communicative systems, such that we 
cannot get consistent comparative data of the kind you are 
talking about.
    Mr. Tiahrt. That is my concern, is that it becomes--you 
know, right now, we do not have any one good measurement system 
for across the agencies or even within an agency. No good 
management tool, yet there are those out there in the private 
sector and there are best practices that are accepted, part of 
the CPA exams are based on some of those best practices, yet 
they are not inherent in our current system of accounting. And 
I just would encourage you to find somewhere, somehow, 
something that we can use to measure agencies, also inter as 
well as outside.
    One last thing I want to ask about----
    Mr. Istook. Mr. Tiahrt, I am afraid I need to call time on 
that or we will not get around to everyone. Thank you.
    Mr. Price.
    Mr. Price. Thank you, Mr. Chairman.
    Mr. Daniels, welcome.
    Mr. Daniels. Thank you.
    Mr. Price. I have a couple of specific questions for the 
record regarding OMB reports that I would like to get a status 
report on.

                           Budget Resolution

    I would like to spend my time this morning on the bigger 
issue that is before us at this moment or was before us 
yesterday and we will be living with for the rest of this 
session and that is the budget resolution conference report.
    The passage of this in the House yesterday, as you know, 
has been treated as something welcomed by this administration 
and actually something of a triumph for the president, but when 
one looks at that resolution more carefully one sees that every 
discretionary budget function is basically just set at 
baseline.
    The education funds that were added in the Senate were 
stripped out, but that is not all that was done. The budget 
resolution also stripped out the president's request which was 
included in the House budget resolution. This budget resolution 
has $21.4 billion less than the president requested for 
education.
    The budget--perhaps I should put budget in quotes, because 
these appear to be just--these numbers appear just to be plugs, 
just to be numbers put there as a holding action. The budget 
provides $61.4 billion less than the president requested for 
appropriated health programs like Ryan White AIDS treatment, 
maternal and child health block grants, Center for Disease 
Control, FDA and so forth.
    In what sense can this be called a budget that embodies the 
president's program?
    My understanding was that the president was not proposing 
simply to set every budget function to baseline, that he had 
some priorities that he was intending to push up here.
    Mr. Daniels. Indeed he does, Congressman, and we think they 
are fairly reflected there.
    Mr. Price. Fairly reflected in those budget numbers that we 
passed yesterday?
    Mr. Daniels. Yes, I do. The budget resolution contemplates 
now about a 5 percent increase in discretionary spending, 
apples to apples. So that is about $31 billion over last year. 
It is over baseline. Not in every account, obviously, because 
certain functions, including national defense and education and 
HHS, principally due to NIH and so forth, are significantly 
ahead and then others were restrained in our submission to keep 
the total inbounds.
    Mr. Price. I am not talking about the aggregate numbers 
here. I am talking about the individual functions. Are you 
saying that the budget resolution as passed by the House 
yesterday is an accurate reflection of the president's 
priorities in terms of programmatic functions?
    Mr. Daniels. It is with a couple of qualifiers.Obviously, 
we believe it is as to the fiscal year just ahead. One of the 
qualifiers is that it is expected and has been made plain all along 
that after the Department of Defense has completed its comprehensive 
review there will be some additional requests, of a size I cannot 
forecast right now, and placeholder has been left or a reserve fund 
created for that purpose, for instance. So not all his priorities or 
his eventual priorities are there now, but the framework is.
    Mr. Price. What about education? Is it a matter of some 
concern that this budget resolution falls $21.4 billion short 
of the president's request in education?
    Mr. Daniels. Well, I am not sure what is being compared to 
what. It is perfectly likely----
    Mr. Price. The functional number is being compared to 
president's request. It is quite straightforward.
    Mr. Daniels. Well, the resolution takes full account of the 
original request we made. There have been discussions about 
additional enhancements of education spending as the education 
bill moves forward and, you know, there are several billion in 
the resolution, much of which may wind up in the education 
account, for all we know.
    Mr. Price. Well, I think there have been many claimants for 
that small amount of flexible money, no doubt defense would be 
in line, as would the veterans programs, as would health care, 
as would education; I know on the VA/HUD subcommittee there is 
a severe funding squeeze; for NSF, EPA, space, HUD, veterans. I 
do not quite know where the slack comes from.
    Mr. Daniels. Well, this, I think, reflects the hazards of a 
time of surplus, Congressman. The Congress lived for several 
years during the 1990s with much smaller increases year on year 
than this resolution would contemplate and somehow a way was 
found. We did not propose those kinds of limits and recognize 
there is a fair difference of opinion, people who think 5 
percent is inadequate, but there are some recent demonstrations 
by the Congress that somehow the activities of government can 
continue without growth at levels higher than this.
    Mr. Price. Well, I am saying is the presence of that small 
amount of flexible money cannot be an all purpose explanation. 
It cannot cover everything.
    Thank you, Mr. Chairman.
    Mr. Istook. Thank you, Mr. Price.
    Mr. Sherwood.

                        PaperWork Reduction Act

    Mr. Sherwood. Thank you, Mr. Daniels. Appreciate your being 
here.
    Paperwork reduction, the Paperwork Reduction Act requires 
OMB to manage government-wide paperwork reduction, but I 
understand in each of the last five years if we have a good 
handle on it, that really we have not had any reduction, as a 
matter of fact, it continues to grow which is, I am sure, the 
reason for the act. And I understand that on April 24th that 
the Government Reform Subcommittee held a hearing on this, but 
I understand that OMB did not identify any specific paperwork 
reductions expected for this year.
    I would like to know why that is and if you do accept that 
as one of your functions and when might you identify some 
specific candidates.
    Mr. Daniels. We are delinquent on that report, on the 
expected report, but it is in preparation and should be 
available soon, Congressman. We take this responsibility very 
seriously. It is statutory, for one thing, but the subject 
matter is very important, too.
    Mr. Sherwood. I think the starting point for any discussion 
on paperwork reduction probably needs to be the recognition 
that over four out of every five pieces of paper demanded by 
the federal government of its citizens come under the IRS 
heading and we probably will never make real headway, material 
headway, against paperwork excesses until we make some real 
headway in terms of tax simplification.
    So that is a starting point. I will not pause for a 
commercial break about estate tax repeal, but these are the 
kinds of things that would more than any nibbling we may be 
able to do around the edges that will really finally alleviate 
this burden.
    Well, I understand that IRS Commissioner Rizzotti testified 
that the potential for greater paperwork and burden reduction 
is enormous, that the potential for that reduction is enormous. 
But I understand that you do not have anybody working on that 
issue.
    Mr. Daniels. Well, no. We have a number of people working 
on the issue in the Office of Information and Regulatory 
Affairs. That office, like the office of the Deputy for 
Management, awaits confirmation and so we are eager to get 
started and to do much more and will take your admonition to 
work harder on it.
    Mr. Sherwood. Well, I would just like to--I think that, you 
know, you have been our source over the years for budget 
numbers that we can trust and that is a very enormous 
responsibility and we think you have done very well with that, 
but there is also the management in the title and it has been 
my limited observation that nothing in the world needs more 
management than the federal government.
    Mr. Daniels. Well, it may be limited, but it is a very 
accurate observation and we share it.
    Mr. Sherwood. Thank you.
    Mr. Istook. Thank you, Mr. Sherwood.
    Ms. Meek.
    Ms. Meek. Thank you, and welcome, Mr. Daniels.
    Mr. Daniels. Thank you, ma'am.
    Ms. Meek. I am sorry I could not be here to hear your 
opening statement.
    Mr. Daniels. When I say you did not miss a thing, I speak 
literally.
    Ms. Meek. I had another meeting across the hall. Treasury 
finally decided to be halfway human and during the last two 
years made some progress. I am concerned about some of the 
funding that you are doing now and knowing--I do not know the 
way you make decisions. I think I would disagree with them, but 
I do not know how OMB makes decisions because a lot of the 
agencies who have proven to be credible in their record of 
performance have been good. In my opinion, they have not been 
given any incentive to do the level of work they were doing or 
even better. It seems to me that you are waiting around for us 
to do it and that is the worst mistake you could ever make, to 
wait for the Congress to put in what you did not ask for. And 
that concerns me.

            First Accounts Program, CDFI and Secret Service

    You had a first accounts program that I worked very hard 
for last year and the committee put it in. People have problems 
getting into banking services and this year it was just giving 
people equal access to banking and we did not increase it, we 
eliminated it. It is eliminated in your budget. And it could 
end some of the ripoffs that happen in urban communities and 
rural communities as well. And I am concerned about that. It is 
geared up to meet low incomeAmericans.
    Also, I notice that the CDFI fund gave me a lot of pain 
when I looked at what CDFI is getting from Treasury and that 
CDFI fund is supposed to promote access to capital and local 
economic development. It is measured by the degree of its 
success and you know how tight Treasury is. This program has 
been run very well and it is doing very well. But yet what 
happened, you gave them an increase of $125 million. That would 
be appropriate, but you did not--you cut them almost 42 
percent. That is a very drastic cut. I think that is sending a 
message to CDFI, even though you have had a very strong proven 
record, you have done what you have purported to do, we are 
going to cut you.
    Let me tell you why you did it, at least why I think you 
did it. You wanted to put in a new program, a new program, that 
is the new markets program, an unproven program. CDFI is 
proven. The new markets program is not. It will take you two or 
three years to gear up to it, even if you were to bring it in 
now, no matter how good it is.
    So when I look at the $40 million that is coming out of 
CDFI, it really pains me because I do know that you could do 
quite a bit through CDFI, which you have already done.
    And in the end I would like you to tell me, you know, give 
me a little confidence in that particular program.
    And the last one has to do with the Secret Service. It is 
just--I was able to talk to the Secret Service people and they 
have about an average of 55 agents that are now leaving the 
force each year, six times the rate only seven years ago, and 
the amount of overtime that these agents have to do to do the 
job they are doing, but I think we should be very, very afraid 
of that practice of stretching good men too far and not giving 
them time to try and retain them by giving them certain kinds 
of things that Secret Service people require and you have lost 
a lot of good skilled men and women and they will be very 
difficult, very hard for you to replace them.
    So that is why I am interested in how you do your budgets 
and what changes that you expect to make that will affect the 
nature of the passback to these agencies.
    I have other questions, I know that our time is short, but 
those three, Mr. Daniels, I wish you would really focus on and 
give me a succinct answer.
    Mr. Daniels. Let me do that and I will be glad also to 
follow up with a letter, Congresswoman, which a couple of these 
I think require some elaboration.
    Ms. Meek. All right.
    Mr. Daniels. The Secret Service issue is one to keep a 
close eye on. I think you are aware that a lot has been done to 
strengthen the service, 478 new agents in the last two years, 
including the year that we are in and that is about a 21 
percent increase, and substantial enhancements of pay on the 
uniformed side.
    We will just have to have a look at what demands are there. 
There is, I think, some reason to think that recent increases 
in demand for those services will not just continue on straight 
up, they are a function of travel, the number of people 
protected and other variables, not all of which are necessarily 
givens, but that is certainly nothing to be unwisely economical 
on and we do not think our budget is, especially given, as I 
say, the increases that have come just recently.
    The first accounts program I am aware of, I know it is 
fairly modest, I think about $10 million.
    Ms. Meek. That is right.
    Mr. Daniels. But we saw it as redundant or duplicative with 
at least two other programs in government, which I can write 
you, and for that reason--you know, we want to be careful not 
to proliferate programs. We would rather find in any given area 
the one or two or three that work best and strengthen them and 
be careful not to add others, which with the same good 
intentions, might only diffuse the federal effort and perhaps 
make it less effective than it could be. And I will be glad to 
follow up with a letter wrapping up all these three subjects.
    Ms. Meek. I would be interested in knowing what other 
programs did do what the first accounts program did.
    Mr. Daniels. I will send you a note and let you know which 
they are.
    Ms. Meek. Thank you.
    Mr. Istook. Thank you, Ms. Meek.
    Mr. Daniels, I understand you need to leave at noon and we 
have about five 'til. I would like to finish up on the 
questions I asked and to ask on the law enforcement; Mr. Hoyer 
might have some others. We can have you out of here probably by 
five after, if that----
    Mr. Daniels. I am at the committee's disposal, but I would 
appreciate it if----
    Mr. Istook. I understand your time commitments and we are 
trying to be considerate of those.

  E.O. 13166, ``Improving Access to Services for Persons with Limited 
                         English Proficiency''

    Let me just first follow up to what I was asking you 
regarding the translation requirements. I certainly hope that 
your statement that you expect Mr. Bush to keep the underlying 
Executive Order in place is an opinion rather than a policy 
statement because I looked back at the terminology of the 
actual Executive Order and it indeed requires the agencies to 
issue these guidelines and the Executive Order incorporates by 
reference the so-called guidance document that was issued 
simultaneously by the Department of Justice and requires the 
agencies to do so, that in essence, however innocuous some of 
the terminology in the Executive Order may appear, by requiring 
them to follow the much more detailed and extremely cumbersome 
DOJ guidelines, it is imposing that requirement through the 
Executive Order. I think some attention to that might be 
appreciated and that is why I think that a rescission or at 
least an amendment would be in order.
    Also, when Mr. Rothman was asking about education, it 
occurred to me and I have not yet had the chance to personally 
review the guidelines, the four of them issued by the 
Department of Education. We know the challenges of bilingual 
education as well, but it is entirely possible that this may be 
telling public schools that since they receive vast amounts of 
federal money they are required to provide personal translators 
for students who do not speak English or not proficient in 
English, as well as written materials or even undoing whatever 
the current requirements are in bilingual education.
    I should mention the pervasive effect in health care. It is 
actually through physicians that this first came to my 
attention, that with the guidance out of HHS and so forth, they 
are told that it is not enough if a family member of a patient 
can provide translation, it has to be someone that is familiar 
with medical terminology and so forth, that the physician 
provides at their expense. So that by seeing any Medicare 
patient, it is not just when they see the Medicarepatient, by 
having any Medicare patient they are required to do this for all their 
patients and, you know, when you look at the large number of people in 
these programs, because these statements do not just say when you are 
dealing with a participant in a federal program, they say that because 
you participate in a federal program, you are required to do this in 
the ordinary course of all of your business. Thus, and through the fact 
that DOJ guidelines include those who contract with the federal 
government as well, you are extending this requirement broadly across 
most businesses and institutions in the country. So I wanted to bring 
back that particular emphasis or, for that matter, a bank, if they 
participate in the student loan program, and so on.
    I think I have made my point clear on that. If you want to 
respond, you certainly may, but, if not, I wanted to move on to 
the law enforcement questions.
    Mr. Daniels. Well, you have very much impressed me with the 
possible implications of all this and I would be, I think, 
better advised to respond later after I have looked at it 
further.
    Mr. Istook. Certainly. I appreciate that. I appreciate that 
because we are hoping for a substantive response, of course.

                  Treasury Department Law Enforcement

    On the law enforcement within Treasury, as I mentioned, we 
are concerned about the basically unfunded obligations, the 
extensive hours, I think someone else referred to them, of 
overtime that Secret Service agents are required to work to 
fulfill their mission, which is protecting the President and, 
of course, others as well, the unfunded mandate regarding the 
national security interests at the 2002 Winter Olympics.
    We heard from Secretary O'Neil that this may indeed involve 
going into the anti-terrorism fund, but if that is the intent, 
I do not see any purpose in appropriating money to the anti-
terrorism fund and then draining that fund in order to provide 
it for the known expense of providing security at the Olympics; 
besides which, if you have a depleted anti-terrorism fund, are 
you prepared for any potentiality that may occur?
    I know the President has devoted some attention to this 
issue recently regarding the appointment of FEMA as a central 
response agency and so forth.
    Can you address why we see this disparity in the funding 
for the 2002 Winter Olympics and the overall funding level 
between the Treasury law enforcement agencies and the other law 
enforcement agencies?
    Mr. Daniels. It is a very important question and I am glad 
to respond. We do believe the Olympics will be amply provided 
for, it is a little over 100, about $103 million, I think, 
total bill across agencies in this area. Within Treasury, we do 
have $43 million of unexpended funds left over from the past 
year in the counter-terrorism accounts. The guidelines drafted 
originally that govern those accounts do, as I understand it, 
certainly encompass an activity like the Olympics and so it 
will not drain the 2002 fund if it is at the appropriate level 
of 45 million. We will need a few million of that in addition 
to the carryover funds to meet the Olympic obligation of 
Treasury.
    So that seemed a common sense way to handle it in Treasury 
and we think that all in all the American people can be 
confident that each agency is going to be able to conduct its 
Olympic activities and its standing ongoing activities within 
this budget.
    Mr. Istook. As I mentioned, it begs the question of, well, 
why have the money go into the fund and then go right back out 
for a foreseen event? And it also kind of begs the question, we 
do not have the answer, we have asked for answer, what is the 
optimum level at which that particular anti-terrorism fund 
should be maintained in order to be prepared for response to 
things?
    Mr. Daniels. That is a very important question.
    Mr. Istook. There is no sense appropriating too much or too 
little to that account and we do not know----
    Mr. Daniels. That is a very important question we will all 
have to work on together. Terrorism is an escalating problem. I 
do not think--and the President has assigned, I think, the 
right people to focus very intently on it.
    Mr. Istook. Well, it has an Oklahoman in charge, so I would 
not disagree with that.
    Mr. Daniels. That is a good start. But I do not think any 
of us at this point can be really sure how big the threat is or 
will become, nor exactly in which departments the response 
capabilities ought to be, but you have your finger on something 
very fundamental for us all that we will work with you on.
    Mr. Istook. Do you have any other comment on the overall 
funding levels between Treasury law enforcement and the others 
that is not specific to the 2002 Winter Olympics?
    Mr. Daniels. Well, I want to have a longer look at it. It 
is interesting but I am not sure it is an all together 
persuasive comparison. There are very different missions 
between between these two departments and I would observe 
that--or at least the numbers I have seen, I am not sure 
whether the chart confirms them or not, but I believe that 
Treasury in the last couple of years has grown at somewhat 
faster rates than Justice, but I think the fundamental point is 
that I think we ought to be careful not to draw too big a 
conclusion from a simple comparison of personnel, for example, 
because who they are, the skills they have, the assignments 
they have, are very, very different, of course.
    Mr. Istook. We know the difference and, of course, we do 
not want a running debate on that.
    I need to yield time to Mr. Hoyer.
    Mr. Hoyer. Thank you very much, Mr. Chairman.
    I wanted to make it clear that the 25 pay gap that I 
referred to, actually the gap is 32 percent. The 25 percent is 
the dollars that would be necessary to get to the 5 percent 
target, 5 percent below the private sector.
    I have several questions here, but I am just going to ask 
you one now. I am going to submit for the record, questions on 
pay parity, on law enforcement, on the winter Olympics, on 
proposed language changes in the budget, on the FAIR Act 
review, and on OMB's unspecified management improvements. As I 
said, although those improvements are not specified, I think we 
all would applaud them.
    Also, I will submit some questions, what he will be doing 
on the electronic government initiative. You have mentioned 
briefly, where the Adminstration's plans are. As well as the 
consolidation of the Executive Office of the President. I am 
very interested in your proposals, and what you think they will 
accomplish. And information technology and official 
representation accounts.
    I will submit all of them.
    Mr. Daniels. Okay.

                            Selection Reform

    Mr. Hoyer. Let me ask a question with reference to 
electionreform which is a very critical issue. We have had, as you may 
know, before the House Administration Committee, bipartisan testimony, 
including the Secretary of State of Florida, who appeared before the 
Committee and testified very eloquently.
    Florida has now adopted a substantial reform bill, very 
similar to a lot of the federal legislation pending, including 
a bill I have introduced. Bob Ney, the chairman of the House 
Administration Committee, and I are going to be working on a 
bipartisan bill, that will be called the Ney-Hoyer Bill. Mr. 
Director there is no money suggested by the president for 
election reform.
    Republicans, Democrats, conservatives, liberals, all 
regions of the country, essentially everybody agrees that the 
federal government has a role in helping. They, after all, are 
federal elections as well as state and local elections.
    Can you comment on the position of the administration with 
reference to funding legislation that might be adopted to 
assist localities in replacing outworn technology, in educating 
election officials, educating votes, providing for provisional 
voting and things of that nature which seem to have universal 
support?
    As you know, the Florida legislation passed with but two 
dissenting votes, Senate and House, cast against it. In the 
Senate, it was 38 to zip, otherwise known as zero.
    I would like your comment on it because I think it is going 
to be important for this subcommittee, which oversees FEC, to 
come up with, frankly, very substantial dollars to assist 
states so that we can get to 2002 and 2004 without having the 
same kinds of problems that nobody wants to see repeated.
    Mr. Daniels. Well, Congressman, I think that the President 
would take a very open stance toward activity in this area. I 
say that while I think continuing in the view that elections 
and their conduct are and will always remain overwhelmingly a 
state and local responsibility, but we had unprecedented and I 
think novel circumstances just recently that caused everybody 
to look at this in a slightly different way.
    We did not attempt--I would not have known where to start 
to anticipate in this budget what the Congress might choose to 
do, what the right way might be, let alone the right 
investment, for the Federal government to make if it enters the 
area of helping states with their responsibility, but the 
President is very interested in election reform and in 
supporting it and so I think that if and when things move in 
this area we will sure listen.
    Mr. Hoyer. Thank you.
    Thank you very much, Mr. Chairman.
    Mr. Daniels. Yes, sir.
    Mr. Istook. Thank you, Mr. Hoyer.
    Mr. Daniels, thank you. We realize--as I said, we have had 
a bit of an imposition and I did want to end on a note of 
appreciation for the fact that you have submitted your own 
budget at a growth rate below the average growth rate in the 
president's own budget and I do believe that when people seek 
to lead by example that that should be noted and appreciated, 
so thank you for that.
    Mr. Daniels. Thank you all.
    Mr. Istook. We stand adjourned.


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                                            Wednesday, May 9, 2001.

                  U.S. GENERAL SERVICES ADMINISTRATION

                               WITNESSES

THURMAN M. DAVIS, SR., ACTING ADMINISTRATOR
PAUL CHISTOLINI, ACTING COMMISSIONER, PUBLIC BUILDINGS SERVICE
DONNA D. BENNETT, COMMISSIONER, FEDERAL SUPPLY SERVICE
SANDRA N. BATES, COMMISSIONER, FEDERAL TECHNOLOGY SERVICE
G. MARTIN WAGNER, ASSOCIATE ADMINISTRATOR, OFFICE OF GOVERNMENTWIDE 
    POLICY
WILLIAM R. BARTON, INSPECTOR GENERAL

                      Chairman's Opening Statement

    Mr. Istook. The subcommittee will come to order. We regret 
having to get started late, but we appreciate people's patience 
with us. This morning we're welcoming Mr. Thurman Davis, the 
Acting Administrator of the General Services Administration. 
And of course, Mr. Davis, I look forward to hearing your 
testimony on the budget request for fiscal year 2002 and all 
the other issues. Given the nature of the organization, I think 
that the concerns of the subcommittee will go beyond just the 
budget request itself. I know some people might look at it and 
say, well, GSA isn't that important if the direct appropriation 
is only, as they see it, $198 million.
    Of course that's only the direct appropriation as opposed 
to other funds that you must handle. Even adding the forward 
funding that was in last year's bill, compared to some agencies 
the GSA appropriation might seem a bit more modest, but that's 
not a good measure of GSA. As you point out in your written 
testimony, the importance and the reach of the GSA extend far 
beyond the norm of most agencies, because it extends into most 
Federal agencies.
    The GSA projects its total fiscal year 2002 obligations 
will be about $18.2 billion. When you consider all the transfer 
and pass-through accounts, most of that is related to revolving 
funds that do not require the direct appropriations but of 
course I and all Members, I think, of Congress are concerned 
not only with the management of the funds but the health of the 
entire agency and its impact on the rest of government. 
Especially the private sector has a major role, because I 
believe it's--I was given the figure of about 94 percent of 
GSA's actual budget flows to the private sector for supplies 
and services.
    The size of funding, of course, is not the only thing that 
affects the visibility of things. We recognize, of course, you 
have high profile accounts such as that for the former 
Presidents, about which we've visited, and I appreciate your 
attention to resolving that matter. And even though the total 
appropriation for the accounts of former Presidents is only 
about $3 million, it always gets a level of attention far 
beyond the dollars involved.
    We're seeing an emphasis on information technology in GSA 
and other government agencies, and GSA, of course, has a 
central role in much of the government work with IT. Your 
budget, of course, follows the trend of emphasizing information 
technology. For example, there's increases regarding 
governmentwide Web sites, governmentwide encryption 
capabilities for safeguarding financial transactions, for 
responding to computer incidents and for a new account 
involving e-government initiatives.
    I have questions regarding several of those. We may not get 
to all of them during the hearing. We'll probably have some 
significant quantity that will be part of the questions for the 
record.

                         FEDERAL BUILDINGS FUND

    There is the perennial concern of the Federal Buildings 
Fund, especially as it relates to new courthouse construction. 
And of course it's not just courthouses alone. You're certainly 
aware, Mr. Davis, of my interest in the new Federal campus that 
will be breaking ground soon at Oklahoma City to replace the 
Murrah Building, which was bombed in 1995. But in FY '02, 
there's almost half a billion dollars proposed in construction 
funding for 13 different courthouses. Many of them are not yet 
authorized, or the funding levels of authorization are below 
the request levels. So it is certainly the policy of our 
committee not to fund such projects that don't have 
authorization, and then we always have concerns over the cost 
on a per-square-foot basis or per-project basis. It's not a 
question of whether new courthouses are needed. It's a question 
of should they cost the amounts that they have. I certainly 
appreciate your attention to different controversies. I know of 
one in Florida that we've met about before that I hope we can 
get resolved, but it appears that that is still not at that 
stage of resolution.
    We have increases in other parts of the Federal Building 
Fund. For repair and alteration, there's $145 millionincrease, 
but I recognize there's a major backlog, and estimations of a far 
greater number that would be necessary to bring everything up to the 
desired standard. There's increases in building operations covering 
rising fuel and utility costs. And frankly, Mr. Davis, knowing what has 
happened with energy prices since the budget was prepared and 
submitted, I think we need to get into the adequacy of that particular 
figure.
    We do want to make sure that all accounts and certainly 
those that have any sort of increase are prudent and 
appropriate levels. It's a difficult role that GSA plays. On 
many occasions I recognize Congress and the public may not 
fully understand or appreciate all that you do, but that does 
not mean that we don't appreciate your devoted efforts. And 
speaking of that, I understand that you have a significant 
retirement coming up with the Inspector General, William 
Barton, who's had 50 years of Federal service, and until June 
the 1st?

                     RECOGNITION OF WILLIAM BARTON

    Mr. Barton. June 1st.
    Mr. Istook. I hope there's little bit more than just a gold 
watch that's involved in that after 50 years. I understand, Mr. 
Barton, that your career goes back to active duty in the 
Pacific with the Marines during the Second World War, 32 years 
with the Secret Service, and now completing your service with 
the GSA. So we very much appreciate your devoted service, as 
well as, Mr. Davis, all of you who have worked diligently on 
behalf of the citizens of the country.
    And, Mr. Barton, we certainly wish you the best----
    Mr. Barton. Thank you very much, Mr. Chairman.
    Mr. Istook [continuing]. In the retirement that you've been 
looking forward to probably for a very long time.
    That concludes my opening remarks. Mr. Hoyer is not yet 
here. So I would certainly reserve to him the opportunity for 
his opening statement.
    Mr. Price, was there something you were wishing to say?
    Mr. Price. No, Mr. Chairman. I have no opening statement. I 
do want to welcome our witnesses and we'll await their 
testimony with interest.
    Mr. Istook. Very good. I thank you. I remind witnesses that 
although prepared statements have been submitted which will be 
included in the record in their entirety, I always encourage 
people to feel free to be extemporaneous. Oftentimes that will 
help us to have a better understanding or get into areas that 
might not be fully covered in the written testimony. It is our 
policy, of course, to swear the witnesses. So if I could do 
that at this time. And I should ask, Mr. Davis, the lady you 
have with you I haven't met. Would you like to identify her for 
the record?
    Mr. Davis. Yes, sir. This is Deborah Schilling. She's our 
Director of Budget. Paul Chistolini, of course, is the Acting 
Commissioner. And I'll introduce a couple of other people if--
should I do that now?
    Mr. Istook. Let's go ahead and just--I just want to make 
sure we swear anyone that you expect might be actually 
testifying.
    Mr. Davis. Well, all of these people might be testifying.
    Mr. Istook. Let's have them swear together, and then you 
can introduce them immediately thereafter. Thank you.
    [Witnesses sworn.]
    Mr. Istook. Mr. Davis, if you would like to identify the 
four persons not at the table who are potential witnesses, and 
then we'll be happy to receive your testimony.

                         Statement of Mr. Davis

    Mr. Davis. Thank you, sir, and thanks again for allowing us 
to appear before you and present our requests this morning. 
Joining me for testimony is Bill Early, who is the Chief 
Financial Officer of GSA; Commissioner Sandy Bates from the 
Federal Technology Service; Commissioner Donna Bennett from the 
Federal Supply Service; and Associate Administrator Marty 
Wagner, Governmentwide Policy; and of course you've already 
recognized our distinguished Inspector General, who we will 
miss sorely. He's been a tremendous asset to us and a wise 
counsel for many years.
    Mr. Istook. Certainly.
    Mr. Davis. Thank you, sir.
    Mr. Istook. And I don't think for the record we've 
identified Mr. Chistolini.
    Mr. Davis. Oh, I'm sorry. Acting Commissioner Paul 
Chistolini from the Federal Public Buildings Service. We just 
always thought everybody up here knows him already anyway.

                         ELECTRONIC GOVERNMENT

    We just want to cover a couple of points if we may. The 
first is GSA's ongoing involvement in electronic government, 
which you've mentioned earlier. Electronic government, with the 
emphasis on improved citizen access to the government, and the 
efficiencies made possible through the Internet, is a major 
focus for the new administration. GSA's budget request includes 
funding for several critical programs aimed at enhancing and 
protecting our Nation's information technology, including the 
administration's proposed Electronic Government Fund for 
initiatives that use the Internet and other electronic methods 
to make the Federal Government more accessible, efficient, and 
productive; FirstGov, which will provide a single e-portal for 
public access to the Federal Government with links to State and 
local governments as well; PKI, the Public Key Infrastructure 
program, which will use digital signal and encryption to 
facilitate e-government; and finally, the FedCIRC, which 
assists Federal civilian agencies in identifying, containing 
and recovering from adverse events impacting our information 
infrastructure.
    In addition to these governmentwide programs, more and more 
of our businesses at GSA take advantage of new technology and 
the Internet offers our customers great deals and prices. GSA 
Advantage, for example, offered 1.2 million products on-line by 
the end of FY 2000. Buyers.gov is a Web-based government 
business and auction exchange, which private citizens can bid 
on surplus property through GSAauctions.gov. Our Federal 
customers can track rent bills, work orders on-line, and an 
increasing number of other payables and receivables are handled 
electronically.
    Our business volume continues to grow as our customers take 
advantage of the cost efficiencies we offer them. Even though 
our business continues to expand, our employee base has reduced 
by about 30 percent since 1993. We're continuing to do more 
with less. Our total budget, as you already mentioned, is 
$18.--budget request was $18.2 billion, of which 94 percent, as 
you've already mentioned, goes to the private sector.

                            CAPITAL PROGRAM

    The other topic I'd like to mention just briefly is our 
capital program for the Federal Building Fund. At $1.5 billion, 
this would be the largest capital program since 1994. $276 
million of this total is funded by advance appropriations 
enacted in FY 2001 for FY 2002, and $1.2 billion is funded from 
the fund'srevenues.
    The top priority of our capital program is the request of 
$827 million for repair and alterations. This represents the 
largest request for this program since 1991. Our existing 
government-owned space inventory has a fair market value of 
over $33 billion, with an identified workload inventory of over 
$4 billion. More than half of our government-owned buildings 
are over 50 year old, and more than a quarter of the inventory 
bears historic designations. This is a little different than 
what our private sector counterparts face. A recent study 
released by the Government Accounting Office has recognized 
that billions of dollars will be needed in coming fiscal years 
to maintain the value and condition of these assets. Approval 
of this request will go a long ways towards helping that 
effort.
    Our capital request also includes significant construction 
programs, $663 million, including funding for courthouse 
constructions, six border station projects, a new NOAA 
satellite monitoring facility, and design of a new Census 
facility at the Suitland Federal Center and funding for ongoing 
FDA headquarters consolidation out in White Oak, as well as 
several other projects. Unlike previous years, most of our 
construction program would be paid for by resources from the 
Federal Building Fund.
    We are proud of the work that's going on within the Public 
Buildings Service, with innovative programs like linking budget 
to performance, customer satisfaction ratings over 80 percent 
and operating costs per square foot at 17 percent below the 
private sector. Our improved management of resources in the 
Federal Buildings Fund has allowed us to plan for significant 
capital investments.
    Thank you, Chairman Istook, thank you, Mr. Hoyer, and other 
members of the committee for the opportunity to be here this 
morning. And we'll take your questions, if we may.
    [The information follows:]


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    Mr. Istook. Thank you, Mr. Davis. Let me yield first to Mr. 
Hoyer to give him an opportunity for his opening statement.

                     Mr. Hoyer's Opening Statement

    Mr. Hoyer. Mr. Chairman, it's my understanding Mr. Price 
has a real scheduling problem. I will yield to him. No? Okay.
    Thank you, I apologize for being late. I was on the House 
floor. I want to welcome Thurman Davis and Paul Chistolini to 
the room. You don't have a name tag, or I would welcome you as 
well. Debbie, do you know who you are? There you go. And she's 
the Director of the Budget. I should know who you are. We need 
more Debbies.
    I want to make a few comments as we open, Mr. Chairman. 
First of all, I want to recognize and thank Inspector General 
William Barton----
    Mr. Barton. Thank you very much.
    Mr. Hoyer [continuing]. For his service, both to the Secret 
Service, which he served so ably for 32 years, and now since 
1985 for his service as Inspector General of General Services 
Administration. The country owes you a debt of gratitude. I 
don't know whether the chairman expressed that. I guess he did, 
and I want to join him.
    Mr. Chairman, GSA is presenting a budget request that 
provides, $18.239 billion in total obligations connected to its 
revolving fund. That is of course only $474 million in direct 
appropriations. Of that, some 94 percent will go to the private 
sector. I think we need to keep that in mind. $276 million is 
requested to pay for Federal courthouse projects forward-funded 
in fiscal year 2001, so that was in the pipeline before this 
year.
    The Courthouse Construction program is an integral part of 
this budget submission, one that I feel frankly doesn't go 
nearly far enough. It is irresponsibly underfunded, and we need 
to do something about that. Very frankly, the past 
administration didn't really step up to the bar on this, nor 
has this administration. So it's been bipartisan neglect, in my 
opinion. Luckily, I think the Congress is cognizant of this 
issue.
    Since fiscal year '96, when the GSA started approving 
prioritized 5-year courthouse project plans, Mr. Chairman, over 
$3.4 billion has been requested to meet the infrastructure 
needs. And I underline needs, as assessed by the Office of the 
Court Administrators and the General Services Administration. 
This is not a partisan list. This is not constructed by 
politicians, but by those who know the needs in the communities 
and the capabilities of the Federal Government to construct.
    Because of funding constraints, only 1.7 billion has been 
appropriated, leaving a backlog of $1.7 billion, to which we're 
responding by appropriating or requesting another $250 million 
or thereabouts. We must get serious about this program, Mr. 
Chairman. The courthouses on the Judiciary's priority list are 
busting at the seams in terms of caseload. Some have serious 
security vulnerabilities, and some are just dilapidated 
structures that cry out for replacement. The longer we wait, 
Mr. Chairman, the larger the backlog grows, and the cost 
increase. That's the key, Mr. Chairman. The costs are 
increasing as we wait, not decreasing. They will not go away.
    Your budget also includes the funding for two initiatives 
that I think require further analysis. The first is $20 million 
for an e-government initiative, the second $11 million for 
computer security. I'm going to ask more detailed questions 
later about them.
    I also plan to ask questions, Mr. Davis, on the conditions 
of our Federal facilities, one that said the Federal Government 
is $4 billion behind in repairs to these buildings.
    I serve on the board of directors of the Naval Academy. We 
have a capital structure, and what we're trying to do is 
between, one, 5 and 2 percent a year on maintenance and repairs 
to keep our infrastructure up to snuff. I'd like to hear, A, 
what our capital investment is, our inventory, thevalue of 
that, and what percentage we are spending on an annual basis to keep 
that maintained and repaired properly.
    I also want to learn more about the progress we are making 
with the Food and Drug Administration consolidation, and 
replacement of the Census Bureau facility and the Suitland 
Federal campus. Mr. Chairman, I don't know that you've been out 
to the Suitland campus, but it was built during the Second 
World War. It is essentially temporary buildings that are not 
only unsightly but also unhealthy and clearly do not lend 
themselves to productivity and an atmosphere in which employees 
are going to do well. You might want to take an opportunity to 
see the Suitland Campus at some point in time.
    Mr. Davis, I want to thank you. Mr. Chairman, I had the 
opportunity to work with Thurman Davis for a long period of 
time now. He is one of the best professionals we have in 
government. He has been relied upon by succeeding 
administrations of both parties for his fairness and his 
ability. Mr. Davis, I appreciate your testimony and lament my 
lateness. So I couldn't look forward to it.
    Mr. Davis. Thank you.
    Mr. Hoyer. Thank you.

                    Timetable for New Administrator

    Mr. Istook. Thank you very much, Mr. Hoyer. Mr. Davis, let 
me pose to you one thing, and I recognize, of course, your 
professionalism and years of experience. Of course, at this 
time, you know, you have the acting designation on top of that. 
I think it would be helpful to have you advise us what your 
understanding is of the timetable in which there might be any 
sort of permanent appointment, which potentially could 
obviously affect different policies and decisions that we may 
have to make.
    Mr. Davis. Mr. Chairman, we have a nominee for 
Administrator, General Services. My understanding is that there 
might be possible hearings before the end of the month. We 
would hope that we would have an Administrator on board by the 
first of next month. That's just a----
    Mr. Istook. Certainly.
    Mr. Davis [continuing]. Hope.
    Mr. Istook. That general overview is fine. We wouldn't 
expect anything more detailed from you. We know that you're not 
in control of that process.

                  Rising Energy Prices and Consumption

    Let me--with so many potential things to dig into, but let 
me start with one of the pressing issues. Energy. I refer in my 
opening statement, of course, to the impact of rising energy 
prices and questions about supply levels. Could you give us an 
overview, please, of the energy consumption that is involved 
with GSA on an annual basis, not only in--associated with the 
Federal buildings but also the Federal motor vehicle fleet and 
what you see as the issues and challenges that will affect the 
cost and availability of that energy in the future years?
    Mr. Davis. Okay. I'm going to invite Commissioner 
Chistolini and Commissioner Bennett to answer two parts of that 
question, if I may.
    Mr. Istook. Certainly.
    Mr. Chistolini. Mr. Chairman, you've hit one very important 
issue for us, and that's energy. During this current year, we 
have seen energy prices go up considerably over what we 
estimated just a year ago. To deal with this, we have in a lot 
of places entered into long-term contracts, where we've 
aggregated Federal needs for energy and, therein, have gotten 
better prices for all of that. The budget before you talks 
about an energy increase of at least $22 million. During our 
current year, we're monitoring both our consumption and our 
plan against the budget on a monthly basis. Our budget this 
year has somewhere in the range of around $260 million for 
energy. And so monitoring that, following energy conservation 
guidelines and practices are very important to us.
    With regard to the recent memorandum that President Bush 
issued, it really stresses conservation. For States such as 
California it requires the Federal Government to actively 
participate in the types of actions that are taking place based 
on the energy levels, for instance. Normally out in California, 
they have a 7 percent reserve. When they get to a stage 2, 
that's down to 5 percent. And a stage 1, it's below 1.5 
percent. Yesterday they were in a stage 3, and that's in the 
month of May, and that impacted over 165,000 customers across 
the country. So we've taken a lot of measures to be ready for 
that.
    We have energy curtailment plans for all our buildings in 
California and actually we have plans for all our buildings 
where we're expecting high energy uses. The Northeast, the 
Midwest, the Northwest and California are the areas that we're 
most concerned about and where we're seeing the greatest 
increases.

                       Alternative Fuel Vehicles

    Mr. Istook. Let me come back to some specifics on that, but 
on the motor vehicle fleet and any other energy consumption 
issues?
    Ms. Bennett. GSA is a major supporter of buying alternative 
fuel vehicles. We have in fact bought some 44,000 vehicles 
since 1991, and we have also, from our own fleet program, 
offered $4 million a year that we use to assist our customer 
agencies in placing AFVs in areas of high pollution, in 
particular, Albuquerque, Minneapolis, Denver, Salt Lake City, 
Melbourne-Titusville and San Francisco. Our goal for our fleet 
program is to meet all of the customer requests for AFVs, to 
the extent that they are available in the market.
    Mr. Istook. Well, let me ask for some perspective on that. 
You mentioned 44,000 alternative fuel vehicles purchased since 
1991.
    Ms. Bennett. Yes.
    Mr. Istook. That's against an overall purchase number of 
what?
    Ms. Bennett. We buy about 50,000 vehicles a year.
    Mr. Istook. So that would be maybe 8, 9 percent?
    Ms. Bennett. Yes.
    Mr. Istook. Over that particular period of time? And it is 
by request of agencies that that is----
    Ms. Bennett. It is by request, although we actively educate 
our customers about the importance of the program. We've worked 
hard with industry to build the infrastructure, that is one of 
the impediments to really getting better acceptance.
    Mr. Istook. And most of these alternative fuel vehicles are 
using what fuel?
    Ms. Bennett. At this point I think they're using ethanol.
    Mr. Istook. And do you know if there weredesire, because, 
as you mention, there's an infrastructure with the availability, 
whether it be ethanol or LPG or natural gas, whatever it may be. 
Considering the availability of the fuel in different areas, what would 
be the maximum number of vehicles that could be purchased and 
maintained from alternative fuels?
    Ms. Bennett. The infrastructure is a limitation. That's why 
we have concentrated the $4 million that we have put into the 
pool for customers to try to concentrate the use of vehicles in 
certain areas so that industry will come in and build the 
fueling sites to support those vehicles. So it is hard to 
spread it out throughout the country without building that sort 
of infrastructure.
    Mr. Istook. Sure. But under current circumstances, you 
know, right now----
    Ms. Bennett. Yes.
    Mr. Istook [continuing]. If you desired to have all 50,000 
annual purchases be alternative fuel vehicles, I'm sure you 
could not. What is the maximum number that you believe could be 
sustained with the existing infrastructure, if you maximized 
that purchase?
    Ms. Bennett. I don't think I have a figure for you. I'm not 
sure that I know how to estimate that number.

                FEDERAL BUILDINGS PROJECTED ENERGY COSTS

    Mr. Istook. Okay. All right. I appreciate that. I might 
have some others on that, but let me get back to the Federal 
buildings a moment before I yield to a different member here.
    I'm going to mispronounce it again. Chistolini?
    Mr. Chistolini. Chistolini.
    Mr. Istook. The figures you mentioned, and you mentioned a 
$21 million plus-up, but I don't know really the aging of that 
figure, recognizing that a lot of your calculations by 
necessity were done last year when you were making budget 
preparations, and the major spike in energy prices has happened 
since January 1st. What is the projection, considering both the 
prices today and the trends today? How does that change your 
figures of your estimation of the expenses at the Federal 
buildings, and do you have a mechanism where that is passed 
through under your leases with other Federal agencies so that 
the cost is ultimately absorbed by their budgets rather than by 
GSA's?
    Mr. Chistolini. We actually modified our budget in January 
of this year and we really spent a lot of effort in trying to 
project what was happening in the different markets. We have an 
energy center of expertise, and their job is to keep track of 
what's going on in the market. So they did use the best 
information that we have. We have tried to recapture as much as 
possible. In looking ahead at the following year's budget, 
we're in that process right now of making sure that our numbers 
that we're going to pass on to our customers reflect the 
ability to recapture that energy cost, just as you mentioned.
    Mr. Istook. Are you saying that you believe that the figure 
that you've supplied in your budget you believe will hold up 
and will be adequate for FY '02?
    Mr. Chistolini. Right now we believe it will be adequate.
    Mr. Istook. Even considering the spikes in price, even 
since January the 1st?
    Mr. Chistolini. Yes.
    Mr. Istook. Okay. And what proportion of that is passed 
through to the tenant agencies of GSA?
    Mr. Chistolini. In government buildings, that's part of our 
operating costs which we pass on, too. So the vast majority is 
passed on to our clients.

                 LONG-TERM CONTRACTS TO PURCHASE ENERGY

    Mr. Istook. And the final question I have in the series: 
You mentioned long-term contracts in a number of places. 
Considering the annual energy purchases by the GSA agencies, 
what proportion of those are covered by long-term contracts 
rather than by current pricing and its variations?
    Mr. Chistolini. I'll have to get you exact numbers but I 
think it's about half. For instance, in California, a couple of 
years ago, as States deregulate, we try to aggregate what the 
Federal usage is and then bring all the Federal agencies' use 
to the marketplace and have them bid on that, and that's worked 
very well. Recently in Pennsylvania we were able to get a 
reduction of about 8 percent over what the previous rate was. 
But not a lot of States have gone to deregulation and permit 
that, but we do have other long-term utility contracts, and I 
will get that information for you.
    [The information follows:]


              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



    
    Mr. Istook. Okay. I would appreciate that for the record, 
and including, of course, information about expiration dates of 
those contracts, because renegotiation might be very 
interesting. Thank you.
    I need to yield time. I understand, Mr. Hoyer, you wanted 
to yield to Mr. Price, who has commitments and needs to go 
forward. Is that correct, or am I mistaken?
    Mr. Hoyer. Well, I was trying to determine that.
    Mr. Istook. Okay. I'll tell you what, Mr. Hoyer, I'll yield 
to you. If you want to then yield to Mr. Price, that's fine--
certainly fine. We'll come back to you.
    Mr. Hoyer. Mr. Price says he's okay.
    Mr. Istook. Okay.
    Mr. Hoyer. Mr. Davis, let me go through quickly the 
courthouse construction questions that I have. I think you know 
what I'm going to ask and will provide that information. First 
of all, what's the total request for the courthouse 
construction program?

                    COURTHOUSE CONSTRUCTION REQUEST

    Mr. Chistolini. It's--including last year's advance 
appropriations, it's approximately $490 million.
    Mr. Hoyer. And how much was the advance appropriation, 
$276?
    Mr. Chistolini. $276 million, yes.
    Mr. Hoyer. So, then, the net is $220 or $214?
    Mr. Chistolini. Approximately, that's correct.
    Mr. Hoyer. So it's plus $214. How much money did the 
Administrative Office of the Courts (AOC) request this year for 
new courthouses?
    Mr. Chistolini. Well, the priority listing of the next 
segment of projects was approximately $626 million.
    Mr. Hoyer. So the request did not include the $276, or did 
it?
    Mr. Chistolini. It did not.
    Mr. Hoyer. So then in effect, of the $626 million 
requested, $214 was granted?
    Mr. Chistolini. That's right.
    Mr. Hoyer. Okay. So some $408--$412 million low. What was 
the GSA's request to OMB?
    Mr. Chistolini. When we began the budget process in 
October, we asked for the full amount.
    Mr. Hoyer. $626?
    Mr. Chistolini. $626 million. As we went through the 
process, some projects dropped out. They simply would not be 
available or ready for award.
    Mr. Hoyer. I understand there are two projects that fall in 
that category?
    Mr. Chistolini. There's Salt Lake City and Eugene, Oregon, 
and those have to do with the site selection and being ready 
for a chosen site.
    Mr. Hoyer. Can you tell me how much the request for Salt 
Lake City was?
    Mr. Chistolini. Those two projects together come to about 
$150 million.
    Mr. Hoyer. So the difference between the $412 and the $150 
would be what the current needed between the Administrative 
Office of the Courts and GSA?
    Mr. Chistolini. That is correct.

                 FISCAL CONSTRAINTS ON CAPITAL PROGRAM

    Mr. Hoyer. Okay. Can you provide any insight as to the 
rationale for not including the AOC's full request in the 
fiscal year 2002 budget? In other words, I'm not getting at the 
politics, but just is there a rationale for not doing this 
beyond fiscal constraints--pursuant to fiscal constraints?
    Mr. Chistolini. All our decisions were based on fiscal 
constraints. Once we knew that all of the projects, the repair 
and alterations, new construction projects all had to come out 
of the Federal Buildings Fund, we tried to get a balance. We 
had the recent GAO report before us, so we tried to put a lot 
of emphasis on our repair and alterations program. So we 
balanced repair and alterations with some new construction of 
border stations and some new courthouses and tried to balance 
all of those needs out within the resources of the fund.
    Mr. Hoyer. So its fair to say that OMB gave you a number 
and you then worked the distribution of that money internally?
    Mr. Chistolini. That's how it works, yes, sir.

             IMPACT OF NOT FULLY FUNDING COURTHOUSE PROGRAM

    Mr. Hoyer. Okay. What's the financial impact on GSA of not 
providing full funding for the particular courthouses that were 
on the list or delaying the anticipated start of construction?
    Mr. Chistolini. Well, it varies from project to project. 
Not having a steady stream of money to deal with courthouse 
projects makes the initial stages of site selection and design 
very difficult and causes a lot of problems. Sites are 
purchased by someone else. They get into city development 
plans, and so we often lose opportunities to get the best sites 
that are adjacent to existing courthouses, which make for ease 
of administration within the court system. And some of the 
markets where the greatest needs are also have some of the 
highest construction inflation. So it's not uncommon to see 
these construction costs go up 5 to 7 to 8 percent a year in 
some of the markets. So that if you delay a project, a $100 
million courthouse project delayed a year might cost $108 
million the next year.
    Mr. Hoyer. So that--would I be correct--if you're 262 
million under the request for this year and if you take your 
low figure of 5 percent, approximately $13 million a year 
escalated cost on the $262?
    Mr. Chistolini. At least, and part of that included what 
unfunded requirements were for some sites, and site to site 
costs are escalating faster than construction indices, although 
the site is just a small part of the overall project cost.

                     ADDITIONAL COURTHOUSE PROGRAM

    Mr. Hoyer. Mr. Chistolini, we are getting to the point in 
the courthouse construction program, where there needs to be 
additions to buildings that have been constructed. Have you 
discussed this issue with the Administrative Office?
    Mr. Chistolini. Yes. One of the things that we're doing now 
is we're looking at major renovations of existing courthouses--
in fact, in the budget, there's over $100 million for repair 
and alterations money that's targeted toward existing 
courthouse buildings, where we're coming in and doing major 
systems, security work, fixing up the infrastructure of some of 
these buildings. And in courthouses, particularly, many of them 
are in historic buildings on the National Register or have a 
great many historical considerations you have to take care of 
as you do the work.
    Mr. Hoyer. Now, two last questions. Thank you, Mr. 
Chairman. Since the Judiciary started approving prioritized 5-
year project plans, what facilities are ready for expansion 
repairs or renovations but have not made it on the 5-year list 
because of delays in funding? Now, if there are a number of 
them, you may want to include that for the record.
    Mr. Chistolini. I would like to consult and provide that 
for the record.
    [The information follows:]

                       Judiciary's Five-Year Plan

    The Judiciary's five-year rolling plan outlines their new 
courthouse construction requirements for a five-year period; it 
includes construction of new, stand-alone courthouses and 
expansion of existing courthouses by construction of an annex. 
It does not include renovation of existing courthouses. The 
Judiciary has identified a number of projects for future new 
construction which they have not yet placed on their five-year 
plan.
    The General Services Administration's (GSA's) policy is to 
build new courthouses identified on the Judiciary's five-year 
plan to meet the 10-year needs of the courts, with a site 
capable of accommodating the 30-year expansion needs of the 
courts.
    The Greenbelt, Maryland United States Courthouse is the 
only completed project that GSA is aware of at this time that 
the judiciary has identied for future expansion on their list 
of future new construction needs. This project will be 
considered in relation to all other new courthouse construction 
projects under the Judiciary's prioritization process as they 
develop their future five-year plans.

    Mr. Hoyer. Okay. Thank you. What process is in place to 
determine how these projects will be considered in relation to 
new construction projects? Now, you may want to include that in 
the record as well, because obviously that relates to a 
question nine. And as you know what I'm getting at, some 
courthouses were built on the theory that they would be every 
10 years expanded so that they were not built on 30-year 
projection of needs. And so that's what I'm getting at. If you 
could answer that in your question.
    Thank you very much, Mr. Chairman.
    Mr. Istook. Thank you very much, Mr. Hoyer, and I need to 
remind our subcommittee members, we've had a number of members 
come in, and we certainly do need to follow the 5-minute rule 
then. Realizing that Mr. Price has a possible scheduling 
concern, I'd certainly yield time now to Mr. Price.
    Mr. Price. Thank you, Mr. Chairman. Mr. Davis, I want to 
welcome you and your colleagues to the subcommittee.
    Mr. Davis. Thank you, sir.
    Mr. Price. And take particular note of your North Carolina 
roots which we're very proud of. You might feature that a 
little more prominently in your biography here, I'd say. We 
know you haven't lived there for a number of years, but still 
have family in Raleigh. So I particularly welcome you on that.
    Mr. Istook. Mr. Price, would you like to recognize anyone 
else in the room that has North Carolina roots?
    Mr. Price. Well, don't get me started.

                  EPA Facility--Research Triangle Park

    Mr. Davis, the main project I've had going with the GSA in 
my district, in recent years has, as you know, been the new 
state of the art EPA facility in Research Triangle Park in 
North Carolina. Employees from 13 rented locations in the 
Raleigh-Durham area will soon be moving into this facility, and 
I want to thank you and your agency for the parts you've had in 
the planning and design of this new facility. Some years ago 
with Mr. Hoyer at the helm of this subcommittee, we managed to 
telescope the planning and design funds, which were 
considerable, into 3 years instead of 5 and to move that long 
delayed project ahead with a joint EPA/GSA appropriation. And 
now of course you're working with EPA on plans for completing 
the project and for moving the employees into the new facility.
    Can you give us any updated information as to when this 
move will start and when it will in all likelihood be 
completed?
    Mr. Davis. I don't know the particulars, Mr. Price. I'll 
ask Mr. Chistolini. I have visited the facility. It is going to 
be a great facility.

                     Move Schedule For EPA Facility

    Mr. Chistolini. Some parts will start this fall, and I'd be 
glad to provide you with a very detailed schedule of when the 
move-in will take place.
    [The information follows:]

     Environmental Protection Agency Research Triangle Park Campus

    The new Environmental Protection Agency (EPA) Research 
Triangle Park Campus consists of three separate facilities. 
Areas 1 through 6 (one building with separate towers) consist 
of office, general, and lab areas. The High Bay Building is 
connected with a breezeway and will house the industrial, 
process systems construction area. The National Computer Center 
is the third building.
    The following dates are the construction completion 
schedules. The EPA scheduled move-in dates are approximately 
three months after construction completion.
    Note: The early date shown below is reflecting the earliest 
possible construction completion date and the latest possible 
date shown is the latest possible completion date.

----------------------------------------------------------------------------------------------------------------
                                                      Early date                           Late date
----------------------------------------------------------------------------------------------------------------
Area 1:
  Office..............................  June 1, 2001.........................  July 1, 2001.
  Lab.................................  August 1, 2001.......................  September 1, 2001.
Area 2:
  Office..............................  June 1, 2001.........................  July 1, 2001.
  Lab.................................  August 1, 2001.......................  September 1, 2001.
Area 3:
  Office..............................  July 1, 2001.........................  August 1, 2001.
  Kitchen (special)...................  September 1, 2001....................  January 1, 2002.
Area 4: Plaza, auditorium, Classrooms,  October 1, 2001......................  January 1, 2002.
 etc.
Area 5:
  Office..............................  November 1, 2001.....................  December 1, 2001.
  Lab.................................  December 1, 2001.....................  February 1, 2002.
Area 6: Lab...........................  January 1, 2002......................  April 1, 2002.
High Bay Building.....................  August 1, 2001.......................  October 1, 2001.
National Computer Center..............  October 15, 2001.....................
----------------------------------------------------------------------------------------------------------------

    Mr. Price. All right. I know that we're--I understand we're 
on schedule for an early fall beginning to this move. I also 
know that it's a long complicated process.
    Mr. Chistolini. It is. It involves moving out of, as you 
mentioned, a number of lease locations and people move in 
different stages and they move out of buildings at different 
times. It has a PERT chart that would fill the entire wall of 
this room.

                   LOCATING FEDERAL OFFICES IN DURHAM

    Mr. Price. I know the move is going to contribute to a 
greater efficiency for EPA, which is now, as I said, in 13 
rented locations, but the agency will be sorely missed as the 
presence in downtown Durham, where a lot of those employees are 
now located. I do appreciate GSA's awareness of that 
sensitivity to it and willingness to work with us to see what 
we can do to locate other Federal offices in spaces that will 
come available as a result of EPA's move or otherwise to help 
fill the gap that that will leave. I do appreciate your 
cooperation on that, and we'll count on that cooperation 
continuing.

                       FSS SCHEDULE 1122 PROGRAM

    Let me ask you briefly about the 1122 program, which, as 
you know, was designed to provide State and local law 
enforcement access to counterdrug equipment on the Federal 
supply schedules. We had some problems a few years ago with the 
expansion of that program, which I understand is now back to 
the original 10 supply schedules. Is that program continuing to 
operate with the same 10 schedules it had originally included?
    Mr. Davis. That's correct, sir.
    Mr. Price. Now, in fiscal 2000, you would have operated the 
entire year under those 10 schedules. Is that right?
    Mr. Davis. I think that's right.
    Ms. Bennett. We have actually consolidated some of those 
schedules. We're down to 7, but it is the same items that were 
originally covered.
    Mr. Price. So the same items are covered?
    Ms. Bennett. That is correct.
    Mr. Price. And with the close of fiscal 2000, were you 
operating that entire year on these 10 schedules, essentially?
    Ms. Bennett. I'm not certain when those consolidations 
occurred.
    Mr. Price. If you could check that.
    Ms. Bennett. I certainly will.
    Mr. Price. I'd appreciate for the record the final totals 
for 1122 sales in fiscal 2000 and the year to date totals for 
this year just to give us some indication of the status of that 
program.
    Ms. Bennett. With regard to the sales, we no longer can 
measure those. GSA originally in this program served as the 
agent that took the orders from the States and actually placed 
them with the vendors. When we went to a pure solution of just 
having them pass the orders to the vendors, we no longer 
actually measure those sales except in one area. And that is in 
motor vehicles, where we place the orders. In 1999, the last 
year we had full sales, motor vehicles represented about 41 
percent of the sales. In the year 2000, we actually saw a 
decline in those sales of about 15 percent. That's the extent 
of the sales figures I have.
    Mr. Price. That's the extent of the figures.
    Ms. Bennett. Yes.
    Mr. Price. Well, I appreciate the agency's cooperation in 
first of all maintaining this program, which is important to 
State and local law enforcement agencies, providing the kind of 
economies they need in their counterdrug efforts, but also 
keeping that program within bounds.
    Ms. Bennett. Yes.
    Mr. Price. So that we're not hurting local businesses or 
otherwise expanding its reach in ways that do go counter to its 
original intent. So I thank you for that report.
    How am I doing on time, Mr. Chairman?
    Mr. Istook. You have about 60 seconds, Mr. Price.

                    REPAIRS AND ALTERATIONS REQUEST

    Mr. Price. Well, let me just get into an area that Mr. 
Hoyer raised, and then maybe we can return to it. Mr. Davis, 
your testimony indicates that your first capital program 
priority is for repairs and alterations to existing properties. 
The administration has requested $827 million for these 
projects. I am appreciative of the security enhancements that 
have been funded from this account, for example, in our Terry 
Sanford Federal Building in Raleigh. But I know there's a 
continuous need at that building and most other Federal 
buildings for repair and alterations. GAO reported last year 
that GSA needs about $4 billion to bring many buildings up to 
acceptable quality, health and safety standards. I assume 
that's a number you agree with. It's not a new number. Funding 
continues to be an issue.
    Could you give us an outline, either now or for the record, 
of the status of initiatives undertaken by GSA to provide 
better program oversight, a more strategic approach to managing 
repair and alterations needs? Clearly this request falls far 
short of the need. Are there ways that you can do more with 
less, achieve efficiencies, and in addition, what are these 
criteria that you referenced in your testimony that you used to 
evaluate and rank proposals? What are those criteria, and are 
they working to achieve some economies?

        CRITERIA FOR SELECTING REPAIRS AND ALTERATIONS PROJECTS

    Mr. Chistolini. Well, let me talk about the criteria first, 
and then we can talk about the others, either here or for the 
record. We look at buildings and look at the tenants' needs in 
the buildings, the infrastructure needs of the buildings, the 
health and safety issues of the buildings, what is the economic 
sense of doing the project, is moving out of leased space and 
into government-owned space involved. And we have an algorithm 
that looks at all these projects from across the country and 
ranks them, and then based on the availability of funds we're 
then able to fund a certain level of projects.
    At the same time, though, we don't just draw the line 
there. We go back to look to make sure that those projects that 
don't get funded do not have conditions that really need to get 
addressed atthis time.

                    REPAIRS AND ALTERATIONS BACKLOG

    Your comment about the $4 billion backlog, that's accurate. 
We recognize that. We've worked with GAO on that. We know the 
backlog is growing at a rate of about 10 percent a year, and so 
we need to get additional funding into this. I think both the 
chairman and Mr. Hoyer recognized in their comments that it's 
necessary to address or put at least 2 to 4 percent of the 
valuation of the assets into these properties. So with a $33 
billion inventory, we should be putting at a minimum of $660 
million and preferably about $1.2 billion into that. Squeezing 
that much out of the Federal Buildings Fund and taking care of 
some of these other needs has been difficult, if not 
impossible. GAO has recommended a number of other measures that 
could be used to finance projects like that so that we could do 
renovations.
    Mr. Price. And your security----

                         SECURITY IMPROVEMENTS

    Mr. Istook. Mr. Price, the gentleman's time has expired.
    Mr. Price. For the record, if you could let us know how 
much of this goes for security improvements, which I understand 
do come out of this account. What percentage of this overall 
are we talking about?
    Mr. Chistolini. I'd be pleased to do that.
    [The information follows:]

               Repairs and Alterations--Building Security

    The fiscal year 2002 Repairs and Alterations program 
contains $24,900,000 for building security. This amount is 
three percent of the total Repairs and Alterations request of 
$826,676,000.

    Mr. Price. Thank you. Thank you, Mr. Chairman.
    Mr. Istook. Thank you, Mr. Price.
    Mr. Tiahrt.
    Mr. Tiahrt. Thank you, Mr. Chairman. Mr. Davis, welcome to 
the committee.
    Mr. Davis. Good morning, sir.

                            NEW TECHNOLOGIES

    Mr. Tiahrt. Reading through your statement, I notice that 
you--in your accomplishments and new directions, you deal quite 
a bit with technology, and I think that's good that you're 
expanding the Internet, making e-procurement a priority and 
simplifying the process so that people have--small businesses, 
in particular, have processes to many providing services, and I 
commend you on that.

                      COMPUTER SECURITY INCIDENTS

    There is one thing that sort of struck me when I was going 
through here. The FedCIRC is collaborating a partnership with 
addressing computer security related incidents. What are those 
incidents? Are they related to fraud or waste or terrorism, or 
what is your risk that you have there?
    Mr. Davis. I'm going to invite Commissioner Bates to 
respond. It could be any number of incidents, and it's in her 
area of responsibility, so I'll let her respond to that.
    Mr. Tiahrt. Welcome, Ms. Bates.
    Ms. Bates. Thank you. Good morning. The incidents that the 
FedCIRC is primarily involved with have to do with cyber crime, 
as well as hacking that you read about, computer incidents. 
It's not so much fraud, waste and abuse but, rather, computer 
hacking and computer crime.
    Mr. Tiahrt. Have you noticed any of it coming from outside 
of the United States, or was it mostly just kids? What 
incidents have you experienced, and do we know where they've 
come from?
    Ms. Bates. Our information is based solely on what is 
reported to us, and the incidences are from everywhere 
worldwide and they come in all sizes, shapes and forms. It's 
not just limited, by any means, to children or pranksters. We 
have every reason to believe that this is a very serious threat 
that's facing everyone today.

                  COLLABORATION FOR COMPUTER SECURITY

    Mr. Tiahrt. Do you have any overlap with other government 
agencies working in the same area, or do you rely on other 
agencies for protection from these types of hackers?
    Ms. Bates. One of the very important cornerstones of the 
entire program is that of collaboration with other government 
agencies and other entities, the industry, everybody, as well 
as relying on education of the entire population. So there are 
many, many entities that we deal with in the collaborative 
effort. While there may be some perceived overlap, it's 
probably very good at this point, because we can't have enough 
information and cannot encourage people strongly enough to 
report the incidences. There's a common feeling that many 
incidences go unreported for a variety of reasons. But we do 
collaborate very strongly with the law enforcement community as 
well as industry, communities, State and local governments and 
international bodies.

                    OVERNIGHT PACKAGE DELIVERY RATES

    Mr. Tiahrt. Okay. Thank you very much. Mr. Davis, on page 
6, your overnight package delivery, it says you're 46 percent 
lower than comparable corporate rates. Do you use private 
carriers or do you use the Post Office for overnight?
    Mr. Davis. I'm sorry. I didn't understand the question, 
sir. I'm sorry.
    Mr. Tiahrt. In overnight package delivery, it's noted that 
you're 46 percent lower than corporate rates. Do you use the 
Post Office for overnight package or is it Fed Ex or UPS?
    Mr. Davis. We're using Fed Ex right now, but I think we're 
going to--come on up, Donna. We're going to be doing some 
further competition to involve more contractors in that 
particular program.
    Ms. Bennett. The current Fed Ex contract expires this 
summer. We have received offers on a multiple award 
solicitation which opens up the business to a wider array of 
carriers. We'll be making awards sometime in the next couple of 
months.
    Mr. Tiahrt. When you make an award, will it just be with 
one air carrier or will they have access to several carriers?
    Ms. Bennett. There will be access to several carriers.
    Mr. Tiahrt. I think that's very wise. I was wondering if 
you're responsible for the $2 billion overrun that the Post 
Office was having. I don't think you are.
    Ms. Bennett. No, sir.

                   SALE OF ALTERNATIVE FUEL VEHICLES

    Mr. Tiahrt. Another question, since you're here, Ms. 
Bennett. When you sell vehicles after they're used and you've 
converted them to ethanol, do you convert them back, or do you 
sell them as they are? Do you have any experience along those 
lines now about getting rid of----
    Ms. Bennett. We sell them as they are.
    Mr. Tiahrt. As they are?
    Ms. Bennett. Yes.
    Mr. Tiahrt. So these go through a regular bidding process?
    Ms. Bennett. Yes, we auction them.
    Mr. Tiahrt. Auction them off?
    Ms. Bennett. Yes.
    Mr. Tiahrt. Do you have any Harley Davidsons? I need a 
Harley Davidson.
    Ms. Bennett. Well----
    Mr. Istook. The gentleman is out of order.
    Mr. Tiahrt. Thank you, Mr. Chairman.
    Mr. Istook. I have priority if any Harley comes up.
    Mr. Tiahrt. Thank you, Mr. Chairman.
    Mr. Istook. I wasn't meaning to cut you off, Mr. Tiahrt. If 
you're not----
    Mr. Tiahrt. Well, I was wondering--just curious about the 
ethanol vehicles, because I think that's sort of the next step 
in our energy policy is to have a heavier reliance on ethanol. 
It solves two problems, partial solving of the import of 
foreign oil, plus it helps farm commodity prices, which are 
greatly in need of help right now.
    Mr. Istook. Certainly. And I don't know if they have any 
ethanol motorcycles or other alternative fuel motorcycles but--
--
    Mr. Tiahrt. It would be the cutting edge there.
    Mr. Istook. Certainly. Thank you. Mr. Hoyer, did you want 
to----
    Mr. Hoyer. I just wanted to warn both the chairman and Mr. 
Tiahrt that of course the chairman of the Senate committee will 
be very concerned about us undermining his supply of Harley 
Davidsons.
    Mr. Istook. Point well taken, Mr. Hoyer. Point well taken.
    Mr. Tiahrt. Do those dinosaurs drive motorcycles?
    Mr. Hoyer. Pardon?
    Mr. Istook. Very good. I think we have a hearing to 
continue. Thank you all, and we'll meet you out in the parking 
lot and all get on our hogs and drive off.
    Mr. Rothman.
    Mr. Rothman. Thank you, Mr. Chairman. Acting Administrator 
Davis, it's a pleasure to have you here, and thank you for 
coming.
    Mr. Davis. Thank you, sir.

              REPAIRS TO THE PETER RODINO FEDERAL BUILDING

    Mr. Rothman. Thank you for bringing all of your extremely 
qualified coworkers. I understand that the General Services 
Administration has requested $5,295,000 dollars for the repair 
and alteration of the Peter Rodino Federal Building in Newark, 
New Jersey, which pleases me. The bulk of this money will be 
used for construction, with a smaller portion used for design, 
management and inspection. I understand that the main agency 
that will be benefitting from this new construction or 
expansion is the, Immigration and Naturalization Service, which 
is apparently going to be consolidating several locations into 
the Rodino Building. Can you tell me please, what the time line 
is for design and construction and completion of this project?
    Mr. Chistolini. Well, you're correct, sir, that this 
project is a renovation of the existing building. It will bring 
INS in from three lease locations. Part of the design is 
underway now. They expect we will make a construction award 
about a year from today. The budget is approved. And it has 
about an 18-month construction period. As you know, this is the 
main place for INS in Newark, which basically makes it the main 
place in northern New Jersey.
    Mr. Rothman. Right. I would say I'm interested for several 
reasons. I formerly served on the Judiciary Committee, and 
we're very proud of Mr. Rodino's legacy. And also, I would say 
immigration constitutes close to 90 percent of our case work, 
and so it is a priority for us. We have a lot of new Americans 
anxious to become citizens, and so we hope your timetable turns 
out to be as you say. And if you can expedite it and keep the 
quality level up to your standards, that would be even better.
    I have no further questions, Mr. Chairman.
    Mr. Istook. Thank you very much, Mr. Rothman. Mrs. Meek 
or--whoops. She's--okay.
    Ms. Meek. I'll be right back.
    Mr. Istook. That's okay. We'll get back to you. Thank you.
    Ms. Meek. I didn't know I was next in the rotation.
    Mr. Istook. We try to surprise you, Mrs. Meek.
    Ms. Meek. Am I next? If so, I'll come back.
    Mr. Istook. I'll recognize you if you wish or I'll 
recognize you when you come back. Mr. Sherwood--I'm sorry. Mrs. 
Northup. I'm going to get myself in big trouble in a second.

                  CONTRACT GUARDS AT FEDERAL BUILDINGS

    Ms. Northup. You're right. Thank you. I'm not sure who's 
best to answer this question, but I know that in the last 
couple of years there's been an effort to reduce the number of 
Federal employees. I was surprised to find out that the 
employees now that provide all the security at the Federal 
building where my offices are located are not Federal employees 
anymore. They're under contract, and they get no benefits, no 
health insurance, no vacation, and I was quite surprised by 
that and wondered if that's true in all of our facilities and 
exactly what the reasoning is behind that.

                 INCREASE IN NUMBER OF CONTRACT GUARDS

    Mr. Chistolini. Well, since the tragedy of Oklahoma City, 
we have more than doubled the number of contract guards 
providing the type of service that you're talking about. We now 
have more than 6,000 contract guards on duty at Federal 
buildings and lease locations across the country and it has 
been done for a couple of reasons. One, we've had a ceiling 
limitation as to the number of Federal employees we could have 
and, two, the types of services that the contract guards 
provide, which is mainly a security service as opposed to law 
enforcement, seems to work very well with this here.
    Ms. Northup. Well, it seems to me like why it works well is 
to be able to point to a reduction in Federal employees but 
actually have the same number. I think that there were always 
these security provisions. Am I not right, that this--this is a 
Federal building. This isn't an area that I represent off 
Federal property, that they always had formerly Federal 
employees, but they've always had security officers there at 
the entrance?
    Mr. Chistolini. Without knowing the specific building, 
generally our policy is that--we use contract guards to assist 
the Federal officers at these locations, and now that we have 
more magnetometers and other security measures, the types of 
duties that these contract guards provide fit into that mold of 
security a lot better. In fact, we actually have more law 
enforcement people on board now than we've had since 1995.
    Ms. Northup. So what you're saying is that they are not 
needed for the house security needs but more for personnel--
they have less training?
    Mr. Chistolini. Well, they don't need to have the law 
enforcement training or credentials, but they do need to help 
provide the security measure, such as manning the magnetometer, 
looking at people's identification, signing contractors in and 
escorting them throughout the building. So it's more of 
matching the task with the person's qualifications.
    Ms. Northup. Well, that's fine. I mean, you can put them at 
wherever that rank is that they would fall, any other building, 
but the fact is that they are full-time employeesserving a 
Federal purpose, and I'm pretty shocked to find out that, you know, we 
see all the time Members of Congress talking about fair employment, 
about reasonable benefits and that we have this whole staff, none of 
whom are getting what we think are sort of the goal of basic packages 
that we hope employers will provide in the private sector. I don't know 
if that surprises anybody else at this table, but I think that's pretty 
shocking.
    Mr. Hoyer. Will the gentlelady yield?
    Ms. Northup. Sure.

                             PRIVATIZATION

    Mr. Hoyer. It's known as privatization. It's known as 
contracting out. It's known as trying to get rid of Federal 
employees theoretically on the rolls and having private sector 
do it, which, as you know, many people on both sides of the 
aisle are strongly in favor of. As you know, I'm not 
particularly a fan of contracting out.
    Ms. Northup. Well, if the gentleman will yield, I--first of 
all, let me say that I think privatization is a reasonable 
thing. I do not believe that when the goal is to point to how 
many fewer Federal employees we have, that when actually we 
have the same number, we're just moving them from a--from 
actually naming them as employees to a contract, that that 
should count as a reduction. But more importantly, I think that 
when we have a request for a proposal, what a basic level of 
benefits are would be expected. I don't--I happen to believe 
that sometimes privatization is a good way to go. But I don't 
think providing such a low level of benefits and in particular, 
like I said, even health insurance isn't provided for these 
employees. I find that pretty surprising.
    Mr. Hoyer. If the gentlelady would yield again. In the 
Defense Department, for instance, when we have these 
discussions about cutting the Federal employees, many say, oh, 
yes, we've cut a lot of people in the Defense Department. 
That's why, the assertion being that that's why we got the 
numbers down. In fact, if you look at the Defense Department, 
there is a very high level of contract employees in the Defense 
Department, and the net number, if you combine them both, may 
not have gone down but you make a good point on two levels. 
First of all, the claim that we're reducing numbers of 
employees may or may not be accurate, depending upon, whether 
we kept them on as contract employees. And secondly, that if 
there is a cost savings, particularly in the short-term--I'm 
not convinced there's a long term savings but if there's a cost 
saving in the short term, it is in many respects because the 
employees are paid less or the benefits are less. I think you 
make a good point.
    Ms. Northup. Well, again let me just say it's not the 
privatization. The reason we talk about fewer employees is if 
you look at the private sector, whether it's building trucks or 
whether it's building washing machines, they make a lot more 
washing machines with a far lot fewer employees, and the 
benefits are still there for those employees. They've just 
relied on technologies and efficiencies to do more. My concern 
is, is that there should be--when you have a request for 
proposal, that there should be a basic level of what the 
benefits would be. I'm not presuming that, you know, quite 
honestly, you know, we--we could debate for a long time what 
the private sector's acceptable level of benefits are, but no 
benefits, no benefits strike me as going in the opposite--you 
know, going to the opposite extreme.

                       FSS SCHEDULE 1122 PROGRAM

    Let me ask you another question. I think that Mr. Price 
approached this with you. The selling to the private sector, to 
State governments and local governments, to nonprofits, a list 
of--while I understand that that permissive legislation is 
there for the purpose of law enforcement, which is seven 
schedules, what was purchased went far beyond what would be 
necessary for law enforcement.
    Mr. Davis. The 1122 Program has been cleaned up and we're 
sticking to those particular items that have been included. I 
think it's down to seven schedules now, you're saying?
    Ms. Bennett. Yes.
    Mr. Davis. Those items have been included specifically for 
law enforcement purposes and that has been the case for the 
last year.
    Ms. Northup. If you are no longer able to track them 
because they go directly to the supplier, how do you know who--
whether or not the entity is entitled to purchase off the 
Federal schedule for--and if they're purchasing for, example, 
law enforcement? For example, if you allow local government to 
buy cars, it's one thing if they buy police cars or unmarked 
cars. It's another thing if they buy them for their park 
service.
    Ms. Bennett. The States are actually required to designate 
State Points Of Contact who are specifically designated as the 
authorized entity to buy from the schedules, and they are 
familiar with which schedules are open to them for that 
purpose. We educate our schedule holders or our contractors at 
the same time. They meet periodically to review their 
activities. In fact, we are conducting a large customer meeting 
later this month. They will actually be meeting as a group just 
to make sure that they understand the program, and we will be 
talking to them again about the controls on the program and the 
limitations on it.
    Ms. Northup. Recently I was looking for a printer, and I 
went to a Web site of, you know, one of the computers, and 
there you could access for businesses, for individuals or for 
the U.S. Government. Now, it asked for a U.S. Government 
number, and I suppose if I had had my number, I could have 
actually put it in there, but I didn't have it. But it struck 
me that, you know, I might be able to, you know--which I think 
is wrong, be able to buy a home printer if I wanted to. It was 
all on-line. You purchased it. Is that true, could I have done 
that?
    Ms. Bennett. It would depend on what on-line site you were 
looking at. There are certainly some sites that commingle the 
offerings of a company with regard to what's available to a 
government buyer versus a nongovernment buyer. I can only speak 
to the site that GSA hosts, GSA Advantage, which does require 
specifically that the buyers from Advantage have designated 
code numbers or they won't be recognized.
    Ms. Northup. But my point is as a Federal employee and as 
an office myself, could I or anybody else that has access to 
that number put it in and purchase--purchase from that 
schedule?
    Ms. Bennett. If you know the schedule number.
    Ms. Northup. Well, it was--I didn't need to know a schedule 
number. What I needed to know was what my Federal Government 
purchasing number was.
    Ms. Bennett. Yes, if you have a Federal Government 
purchasing number, meaning you have a charge card or an 
authorized account number, then you are authorized to buy from 
a schedule.
    Ms. Northup. And so no one would have checked to see 
whether that was a private purchase? I could have purchased it 
for my children's private school? I could have purchased it for 
the friends who live across the street? I mean, is that the 
only safeguard that exists?
    Ms. Bennett. Well, if you buy it with a government charge 
card and you get caught buying in fact for personal uses, you 
are fraudulently using that card and there is follow-up action 
taken.
    Ms. Northup. Actually, I think this was asking not for a 
charge card number. I think I could have put in my personal 
credit card. It was asking for--for a purchase number, like 
apparently my office has----
    Ms. Bennett. It would not be, at least in an authorized GSA 
site, it would not be any personal number. We assign numbers. 
We know who the numbers are assigned to in terms of 
authorization codes.
    Ms. Northup. All right. And so if I use that, my question 
is how carefully do you document what's purchased with an 
authorized number, and for what purpose is it purchased?
    Ms. Bennett. GSA does not monitor those purchases. Those 
are done within agencies.
    Ms. Northup. And this was--I think this was the Sony Web 
site. Does Sony--if what you said earlier was that local 
governments purchase directly from the----
    Ms. Bennett. From the contractor?
    Ms. Northup [continuing]. Producer, the person selling it--
I mean, I guess what I'm trying to figure out is if--let's say 
the Web site I'm on, let's say it is the City of Louisville, 
and they decide they're going to purchase a computer for their 
policemen. All right. That's an okay. Then they decide, well, 
let's go and purchase them for the health department to and, 
hey, while we're at it why don't we purchase some computers for 
the parks department. Is that possible?
    Mr. Davis. It's possible. But if one of our purchasing 
agencies using a card or a code goes onto the system and makes 
a purchase, it is the responsibility of the manager to ensure 
that that expenditure of funds is correct and appropriate. 
That's true with any other agency, too. GSA itself is not 
responsible for ensuring that other agencies expend their funds 
in an appropriate fashion. The other agency has that 
responsibility.
    Ms. Northup. I think you're missing my point. My point----
    Mr. Sherwood [presiding]. Mrs. Northup, I think maybe we 
better see if you can follow this up with----
    Ms. Northup. Okay. Let me just--I'm concerned about taking 
the commerce out of the local community and allowing much more 
expanded purchasing from the GSA account, which makes us become 
like the Wal-Mart of a small community.
    Mr. Davis. I understand. Okay.
    Mr. Sherwood. Thank you. Mrs. Meek.
    Ms. Meek. Thank you, Mr. Davis, and I welcome your staff.
    Mr. Davis. Thank you. Good to see you.

                     GSA COORDINATION WITH CONGRESS

    Ms. Meek. Good to see you. I have just 5 minutes, and I'll 
make a comment first regarding GSA. I just wish I knew more 
about what GSA does. I know that this has been something that 
your people have tried to help me with all the time, and we've 
met with them. They've come to Miami and back and forth. But 
there still is that gap, you know, of knowing what you do. It 
makes us better Congress people when we know what GSA is doing, 
so that sometimes when you're going to run into sticky wickets, 
we don't know about it until you are in the sticky wicket. Now, 
if we were to know about it ahead of time, many times we could 
run interference for you. That's happened a lot in my area, 
particularly with INS buildings--I'm sure you're aware of 
that--and a lot of other facilities you plan to bring to my 
area that I know nothing about until there's some little 
turmoil or something going on in the community.
    My point is, is there any way that you could improve the 
contact? You know, we're getting almost like pothole people 
these days in the Congress, particularly in an area such as 
mine, in my district. People want to know--they ask me 
questions that I can't answer. I know to call you, but I would 
like to know ahead of time some of these things that are going 
on. Is my point well understood?
    Mr. Davis. Yes, ma'am. We would be pleased to sit down with 
you at any time and give you an update as to what we're doing 
in your district, what's going on there and so forth. We could 
do that either here or in your district with your State 
director or your district director.
    Ms. Meek. That would be very helpful, Mr. Davis. Your 
procurement responsibilities are critical in building this 
Federal Government of ours that works better and costs less, 
and you're making good progress with this. Your real estate 
activities are commendable. You're doing a good job in that 
regard, but I want to focus my points on two areas, and I know 
each of your workers know about this. Every time you see me 
it's courthouse, courthouse, courthouse, in that it's been a 
while in trying to bring this courthouse situation to a head. 
And I'm hoping that it's ended before I go to the senior 
citizens center. Before I'm in a retirement home, I am hoping 
that the Miami courthouse will become a reality, and that's 
been a long process.
    The status of this--at this point I want you to talk a 
little bit more about it. I know a lot about it, but certainly 
time is important, and the more time that--the more time it 
turns over, the more money it's going to take to put this 
courthouse--have it to come up.
    The second thing I want to ask you about has to do with one 
of my favorite agencies, and that's the Consumer Product Safety 
Commission, and they have some initiatives going on, and you're 
involved with that. It appears to me that you are moving just 
like a--not a torque or a terrett, as my mother would say, in 
moving in this particular account. And this is a very small 
agency, but they're doing some extremely important work with 
children and the safety of children, and you promised to build 
them a warehouse. It doesn't sound much to you, I know, but 
it's important that this warehouse, which they're trying to 
get, comes on-line. And it's sort of slowing up what they're 
doing.
    But first of all, would you address the Miami courthouse 
for me? Tell me something you haven't told me in the last three 
times.

                   STATUS OF MIAMI COURTHOUSE PROJECT

    Mr. Chistolini. Well, it's in the budget. There is $121 
million in the budget for the Miami courthouse. In fact,this 
afternoon, one part of this project has been authorized by the Senate 
but not the House, and this afternoon we'll be talking to people on the 
House authorizing subcommittee about scheduling a hearing and about 
getting this project authorized. We have completed the design. It's a 
very attractive building, designed by a world class firm that's 
renowned for both security and for first-class architecture. I'm very 
hopeful that next year at this time they will be breaking ground.

                    DISAGREEMENTS CONCERNING DESIGN

    Ms. Meek. That's very good. I'll have to show you some of 
the things we get involved in. We've been in a big hassle about 
the design. I have nothing to do with the design, but there are 
people who have problems with the design. We have a very mixed 
populace in Miami and Florida, and of course I'm glad that GSA 
is open to the many vicissitudes of what it takes to be a 
Congress person in that area, and the more I can stay in 
contact with your office or with your people, the better it 
will be. And I'll tell you a sign they used to have on my desk, 
and I need to put it back when it comes to agencies. ``Assume 
nothing.'' Please contact us, let us know what's going on. 
Don't assume that the people are going to like what you're 
doing. And I'd appreciate that.

         STATUS OF CONSUMER PRODUCTS SAFETY COMMISSION PROJECT

    And my last part has to do again--you know, I accept your 
answer. I hope we can get it authorized very soon. The second 
one that is back to the consumer product safety in the quick 
time I have. When will they get their laboratory, and when will 
they get a sample warehouse at the laboratory site? Now, are 
you aware of this problem?
    Mr. Chistolini. Just vaguely, and I have no dates rolling 
around in my memory. But I'd be pleased to provide you that 
information within a day or so.
    [The information follows:]

                  Consumer products Safety Commission

    GSA will complete the master plan for the site in early 
September 2001. It will then be submitted to the National 
Capital Planning Commission (NCPC) fro review. Given the normal 
time required for processing, and assuming community support, 
the earliest date for NCPC and Montgomery County approval is 
December 15, 2001.
    The time required to design and build the warehouse is nine 
months. Therefore, the earliest possible date that the facility 
will be available for Consumer Products Safety Commission 
occupancy is September 2002.

    Ms. Meek. All right. Thank you. Well, I can't fuss anymore, 
because you don't know what I'm talking about. That's the end 
of my questions, Mr. Chairman. Thank you.
    Mr. Sherwood. That's a good reason, Ms. Meek. Mr. Davis.
    Mr. Davis. Yes, sir?

          CRITERIA FOR CONSTRUCTION/ALTERATION OF COURTHOUSES

    Mr. Sherwood. I'd like to continue on this courthouse chat 
a little bit, but I may look at it a little bit differently. 
Your opening statement says your--one of your principal goals 
are to promote responsible asset management in the Federal 
Government, and I certainly think that's the case. But what is 
the new administration's, or what is your criteria for the 
construction and alteration of courthouses? You know, in view 
that--in my understanding, on average, trial courtrooms are 
used for trial or nontrial purposes on only about 54 percent of 
all days that could be used in the Federal workyear. In other 
words, the Nation's courtrooms are on average used for some 
purpose 135 days and vacant 115 days of the 250-day Federal 
workyear. Now, I realize that every Federal judge in the world 
would like to own his own courtroom, but is that something we 
can afford to do, and is it because of the fact that we've been 
setting unrealistic goals for courthouses that have something 
to do with their high cost and being behind schedule?
    Mr. Davis. Well, let me say--and then I'll turn it over to 
Mr. Chistolini, who's more familiar with this than I am, but 
let me say that we've worked awfully hard to negotiate a design 
guide for the court system, and we try to adhere to that, 
because that at least has the agreement of all the parties 
involved.

                         COURTHOUSE PRIORITIES

    With the specifics, Paul, do you want to respond to that?
    Mr. Chistolini. We use the court's priority list. The 
Administrative Office of the Courts has a matrix that they use 
to evaluate needs, and it takes into account a number of 
things: the security at a location, the caseload, the 
deficiencies of the existing location, etc. And out of that, 
they get a ranking, and they give us the projects of what's 
actually needed. We defer to them in terms of what project 
should be done next based on their expert analysis of the 
needs, the use of the courtrooms and the court facilities 
themselves.
    Mr. Sherwood. Gentleman, you told me everything except what 
I wanted to know.
    Mr. Chistolini. I didn't pick up about the costs?

                           COURTROOM SHARING

    Mr. Sherwood. No. Are you designing them for single usage 
or multiusage? In other words, we understand that courtrooms on 
the average are used 135 days a year. Now, there's more than--
you know, that would be--in a one-judge court, that would be 
one thing, but any court I know of has several Federal judges. 
What is the design criteria?
    Mr. Chistolini. The design criteria in the court's design 
guide is that each active judge has a courtroom.
    Mr. Sherwood. That may be part of our problem.
    Mr. Chistolini. I think last year the Administrative Office 
of the Courts conducted a study. They had an outside consultant 
come in and look at utilization and come up with some 
recommendations about how better to use courtrooms. Last year 
at this time, the administration had taken a position that once 
you get above a certain size, there ought to be some economies 
of sharing, that once, let's say, you had 10 judges, maybe you 
could get by with eight courtrooms, by better efficient 
management. The AOC did their own study, and I'll defer to them 
when they testify, but I believe it's still one courtroom for 
every active judge.

                        COST OF MIAMI COURTHOUSE

    Mr. Sherwood. It was interesting to me that the cost that 
you told Mrs. Meek for the Miami courtroom was--courthouse was 
to be $214 million. Is that--did I----
    Mr. Chistolini. $121 million, sir.
    Mr. Sherwood. Oh, $121. Excuse me, Mrs. Meek. I wouldn't 
want to make it any worse than it is.
    Ms. Meek. Would the gentleman yield?
    Mr. Sherwood. Certainly.
    Ms. Meek. One thing. I'm glad you mentioned Miami.And who 
is this--Chistolini? Is it Chistolini?
    Mr. Chistolini. Chistolini.
    Ms. Meek. Sorry about that, Mr. Chistolini. I understand 
these inflationary pressures that you're having, but the Miami 
project, because of the delays that came up, the costs have 
been increased by about $13 million as a result of these 
delays, and these costs should have been included in the 
administration's 2002 budget request. And I'd request that they 
be placed in our bill. Why were the increased costs of the 
Miami courthouse project not included in the 2002 request?
    Mr. Chistolini. The project that's in here anticipates a 
certain number of courtrooms, 12. The project that's been 
authorized by the Senate anticipates more courtrooms. The 
administration's budget is only for the number of courtrooms 
called for in the design guide, and to get back to----
    Ms. Meek. I thank you, gentlemen.

              JUDICIARY LATITUDE IN COURTROOM CONSTRUCTION

    Mr. Chistolini. The chairman's point here, and that was 
that the judges and the courts have a certain amount of 
latitude about the number of courtrooms, the usage, for senior 
judges and all of that. This particular project has been the 
pinnacle of a lot of that discussion about utilization sharing 
and that sort of thing.
    Mr. Sherwood. And I sympathize with you for being in the 
middle of those pressures, but I think it needs to be said here 
today that resources are finite, and if we are behind on the 
schedule to build our new courthouses, I think that it would 
bear looking at whether or not we're building them to a design 
standard, which might be delaying other projects because of the 
finite resources. And I think that that needed to be said.
    Mr. Visclosky.

                    STATUS OF HAMMOND, IN COURTHOUSE

    Mr. Visclosky. Thank you, Mr. Chairman, and if I could 
follow up on the line of questioning on courthouses, we have 
one under construction in Hammond, Indiana, as you may know. I 
would preface my remarks by saying that after several years of 
construction, within about the last 30 to 45 days, I did a tour 
of the facility. My curiosity after 51 years got the better of 
me and I asked the employees who were giving me a tour whether 
or not I could see one of the restrooms that was being provided 
for the Federal judges. The GSA employee got on her cell phone 
to see if she could get permission from the Federal judge for 
me to see this restroom in a building that's under 
construction. And for a moment, I thought I was in the NRO 
building. I suggested that we didn't need to impose on the 
judge's time, that I would let my imagination simply run wild. 
And I note your observation about the judges having a certain 
amount of latitude. To be very frank with you, I believe during 
the 8 years, the former chair, Mr. Lightfoot, Mr. Hoyer and 
others and I fought to get that courthouse built, that there 
was way too much discretion as far as the Federal judiciary. I 
would point out the courthouse in Hammond was to be opened and 
occupied in November of 1999, then in January of 2000, then in 
September of 2000, then in March of 2001, and now it's simply 
sometime later this year. Would you, for the record, give us a 
date as to when that building will be open?

                    DELAY OF HAMMOND, IN COURTHOUSE

    Secondly, in October of 2000, David Wilkinson, who was a 
spokesman for GSA, stated that the minor work to be completed 
primarily consisted of discolored limestone, which was not 
identical in shade or color. Thereafter, in December of 2000, 
Mr. Wilkinson stated that the major reason for the delay now 
was that the wood paneling for two courtrooms was--and I'm 
using his words--aesthetically impaired, end quote. I 
understand the paneling is English brown oak and that it is a 
fairly standard but also a very expensive material. I am 
wondering why a project is being held up for aesthetic reasons, 
and is there paneling of a less interesting grain that could be 
substituted?
    Mr. Chistolini. Well, this is one of the----
    Mr. Visclosky. In this room, we have no wood--well, we do 
have some wood paneling behind us.
    Mr. Chistolini. This is a project that I've visited twice 
in the past 6, 7 months, with a specific goal of urging it 
toward completion. I'm aware of the limestone issue and the 
fact it's some 80 or 90 panels that look a little different. To 
me, that's part of the natural character of the building. I've 
also looked at the wood paneling in the--one particular judge's 
chambers, and it's not up to his particular standard, and so 
we're trying to work through that. With regard to a date, best 
information I have--and I will confirm it in writing--is that 
we're looking for a September date--September this year, 
September 2001 date to move people into that building.
    [The information follows:]

                      Courthouse, Hammond, Indiana

    The Hammond, Indiana United States Courthouse project has 
incurred significant delays due to the dwindling size of the 
workforce on the project. The General Services Administration 
(GSA) is scheduled to meet with the contractor on May 24, 2001, 
to address this issue and the timeframe for the expected 
completion of the project.
    Although the wood paneling for one courtroom and the 
library have been unsatisfactory, new paneling has been located 
and will be installed at no additional cost to the Federal 
Government. The affected judge will use another courtroom until 
the replacement paneling is satisfactorily installed. This will 
not delay occupancy of the courthouse.
    By the same token, GSA does not expect any delay or 
additional cost due to the courthouse's limestone. It is 
anticipated that the natural drying process of the stone will 
result in more uniform colors. After the drying is completed, 
if any stone is considered to be too dark, a surface treatment 
will be used to address the situation.

                     HAMMOND, IN COURTHOUSE BUDGET

    Mr. Visclosky. When we started this project, the price tag 
was going to be about $50 million, and then additional security 
issues were raised. And I don't think anybody can complain 
about that. But now the additional costs amount to about $15.4 
million, which is in the ballpark of about 25 to 30 percent. 
And also I had always defended the program on the basis that if 
we could get these disparate Federal agencies all in one unit, 
the U.S. attorneys wouldn't be paying rent to a private 
landlord. I think the delays certainly have added to that 
rental cost.
    I have several other questions, if I could submit them for 
the record, but I would urge you to tell people to step on it. 
And as I said publicly before, I am a tenant at IUN and GSA 
helps us as far as being the Federal landlord. From my 
perspective judges are tenants, too, but I do think that this 
has really gotten out of hand.
    Mr. Chistolini. Sir----
    Mr. Visclosky. I don't mean this as a personal attack on 
judges, but it certainly seems very endemic to these types of 
programs.
    Mr. Chistolini. With regard to the budget, it is my 
understanding we're going to finish this project within the 
appropriation that Congress has given us.
    Mr. Visclosky. Thank you, Mr. Chairman.
    Mr. Sherwood. Thank you. I thank you also for helping make 
my point before you--that I was talking about before you came 
in. If we have finite resources, we're going to have good 
courtrooms and up to standard throughout the country, we've got 
to have that be a reasonable standard, not an unreasonable 
standard.
    Mr. Hoyer.

                    NEED FOR ADDITIONAL COURT SPACE

    Mr. Hoyer. I have some questions on the Census Bureau that 
submit for the record, because I don't think that I can come 
back. The questions will take longer to develop than we have 
time before the vote. But let me make a comment with respect to 
Mr. Sherwood's observations. There has been a tug of war 
between the Judicial Conference Congress and the appropriators, 
and GSA. It's going to continue to be a tug of war. Judge Roth 
testified last year on this issue. But very frankly, that is a 
side issue, and we can talk about it all we want. We can talk 
about waste and fraud all we want. We can pretend all we want, 
but the fact of the matter is we have a very substantial 
surplus and a very big need, not to accommodate judges but to 
accommodate the public, to accommodate justice being relatively 
prompt, not being delayed, being conducted in an environment 
which is healthy for those who are there and who work there 
every day, being secure so that when we take some dangerous 
people, that we have places to accommodate them. Places do not 
pose a risk either to the court personnel or to the public. We 
ought not to divert ourselves from the critical need that 
exists.
    That is not to say that we ought not to address, Mr. 
Sherwood, the legitimate--very legitimate questions you raise, 
but I will guarantee you you're not going to save $200 million 
by having multiple judges use one courtroom. I think that makes 
sense when you get to a certain number of judges.
    You observed that one-judge courthouse, obviously you 
couldn't have. But above that, I think it's a legitimate 
discussion to have. But the crisis that we have is that we are 
costing the taxpayers of the future more money. We are 
shortchanging the users of the courthouse. We are a nation of 
laws. We resolve disputes in courthouses across the land, and 
the fact is that we are woefully underfunding the courthouse 
construction in America. Why? For the same reason that the 
private sector and the public sector get into trouble with 
respect to their infrastructure, because we can delay it for a 
year, we can delay it for 2 years, we can delay it for 3 years 
without an immediate consequence, because it's easy to delay 
maintenance and replacement. But doing so, particularly when 
you have a surplus, particularly when you're in good times as 
opposed to bad times where you need to pull in the reins, 
building a courthouse will not cost you more operating funds. 
Why? Because the courthouse personnel exists. In fact, because 
of efficiencies that may well be built into your new structure, 
you may save money. However it seems to me that when you have a 
surplus, you need it is the most rational thing to apply that, 
because it does not put you in a trick bag when you have leaner 
times by building in additional operating costs, which creation 
of a new program does.
    We have 3\1/2\ minutes. We better go.
    Mr. Sherwood. Yeah. We better go, but I'd like to make the 
final point that whether we have a surplus or not, prudent use 
of our money will give us the best courthouses in the future, 
and if we're holding them up because of the color of the marble 
and the texture of the wood and spending lots of money in that 
regard, somebody else isn't going to get a new one that they 
need.
    Thank you very much. The hearing is adjourned--recessed. 
Excuse me. Correction. The hearing is recessed.
    [Recess.]

          GUIDANCE REGARDING LIMITED ENGLISH PROFICIENCY (LEP)

    Mr. Istook. No problem, Mr. Davis. You're mighty good to 
put up with the difficulties of our back and forth schedule 
between the floor and here today. Let me ask you, Mr. Davis, 
how frequently does GSA issue a policy guidance to entities 
with which it's involved?
    Mr. Davis. I'm not sure I understand your question.
    Mr. Istook. Let me be specific. Sure. Certainly. GSA 
published in the Federal Register January 17th of this year a 
policy guidance. This was in follow-up to an executive order 
that had been issued by President Clinton in August, relating 
to persons who were described as having limited English 
proficiency. And that is a policy guidance, which--and I'm 
reading from it; ``General Services Administration provides 
this policy guidance for its recipients of Federal financial 
assistance to ensure meaningful access to Federally assisted 
programs and activities for persons with limited English 
proficiency. This policy guidance does not create new 
obligations but rather clarifies existing responsibilities, 
under title VI of the Civil Rights Act of 1964, as amended, its 
implementing regulations and relevant case law.''
    So that's why my first question related to this is how 
common is it for GSA to issue a policy guidance that's 
addressed to persons that are involved in Federal financial 
assistance programs relating to GSA? Do you know of any other 
instances?
    Mr. Davis. Marty Wagner, sir.
    Mr. Istook. Certainly. Thank you.
    Mr. Wagner. Mr. Chairman, I'm afraid I know 
absolutelynothing about what you've described, but we will submit an 
answer to the record. In general, we issue policy guidance under the 
Property Act for, you know, the standard how the government manages 
itself. We have the Federal acquisition regulations, which are 
published roughly quarterly. We'll have the Federal travel regulations 
which will do the per diem every year. So there is actually a fair 
amount of policy machinery issuing regulations and guidance on all the 
issues about how the government manages itself.
    I'm afraid I'm not at all familiar with the issue you 
raised, but I will find out about it.
    [The information follows:]

                       GSA Policy Guidance on LEP

    It is not a common practice for GSA to issue policy 
guidance to persons involved in Federal financial assistance 
programs. GSA's Office of Civil Rights has issued policy 
guidance to State Agency Directors for Surplus Property because 
they assist us in implementing our Title VI program. However, 
the Office of Civil Rights has never issued policy guidance to 
recipients of surplus property.

    Mr. Istook. As you describe it, those are matters of 
internal management. You don't know--if I understand you 
correctly, you're saying you don't know of any other occasion 
when GSA has issued a policy guidance that is not directed 
internally within GSA but instead is directed to people with 
whom it does business or people who are beneficiaries of one of 
it programs?
    Mr. Wagner. The only thing I would try to be absolutely 
clear on, a lot of regulations that GSA would apply would apply 
to the government as a whole, e.g., all government travelers.
    Mr. Istook. Certainly, or all contractors.
    Mr. Wagner. Certainly.
    Mr. Istook. This one, however, is not addressed to the 
government. It's addressed--as it states, for recipients of 
Federal financial assistance, which is described further on 
therein, but if I understand you correctly, you don't know of 
any other occasion when GSA has issued a policy guidance for 
people outside of GSA?
    Mr. Wagner. Outside the--outside of, yes.
    Mr. Istook. Okay. Certainly. Let me--and I understand that 
you may not know specific answers, but I think it's important 
to go through this so that you might understand the 
significance of this or the difficulty with this.
    Now, put briefly, the policy guidance states that the 
entities and the people to whom it's addressed have an 
obligation, at their own expense, to provide an oral translator 
and written translations of documents from English into other 
languages, depending upon the language with which another 
person that's doing business with them or is receiving some 
assistance is familiar. And it imposes that obligation to 
provide translation orally and with documents, including what 
it terms are vital documents, which frankly is so broadly 
stated that it can include just about any documents, including 
certain things posted on Web pages, and here is what I want to 
get to, because when you say, well, to whom is this addressed? 
And the question of the legal authority, because this policy 
guidance hinges--a lot of the statements that it contains hinge 
upon some lower court decisions that were reversed by the U.S. 
Supreme Court last month in the Sandoval decision. I think it 
was actually, what, Alexander v. Sandoval, whatever the style 
of the case was before the U.S. Supreme Court. That particular 
one was an Alabama case where Alabama said you had to take your 
driving license test in English. They claimed they didn't, that 
that was unlawful to require them to do it in English, and the 
Supreme Court ruled in favor of the State of Alabama. So the 
legal authority, much of it that's cited in this policy 
guidance, has been overruled by the U.S. Supreme Court within 
the last month.
    Now getting to the question of, well to whom is this 
addressed that GSA is telling people that this is your legal 
obligation, and the persons--as I say, it's people who are 
involved in Federal financial assistance programs. And I'm 
going to read from the document as it describes those 
assistance programs and who is involved with them. As it 
states, the two major programs at Federal Financial Assistance 
are the Federal surplus personal property donation programs and 
the disposal of Federal surplus real property for public use. 
The Federal surplus personal property donation program enables 
certain non-Federal agencies, institutions, organizations and 
certain small businesses to obtain property that the Federal 
Government no longer needs. And it goes on to describe the 
broad variety of that property, everything from hand to machine 
tools to motor vehicles, boats, airplanes, electronic equipment 
and so forth.
    And then it describes the entities: Federal surplus 
personal property may be donated to nonprofit educational and 
public health activities. Eligible recipients include nonprofit 
educational and public health activities, such as medical 
institutions, hospitals, clinics, health centers and drug abuse 
treatment centers, schools, colleges and universities, schools 
for persons with mental or physical disabilities, child care 
centers, educational radio and television licensed by the 
Federal Communications Commission, museums attended by the 
public, and libraries, nonprofit tax exempt organizations that 
provide food, shelter or support services to homeless people. 
Additionally, public agencies involved in such activities as 
conservation, economic development, education, park and 
recreation programs, public safety, public health, programs for 
the elderly and programs for the homeless. Public agencies 
generally include States, the departments, divisions and other 
instrumentalities, political subdivisions of States, cities, 
counties and other local government units and economic 
development districts, instrumentalities created by compact or 
other agreement between State or political subdivisions, Indian 
tribes, bands, groups, pueblos or communities located on State 
reservations, states and local government bodies and certain 
nonprofit institutions, community-based educational 
organizations, schools, nonprofit groups. It mentions the 
allocation of space for little or no cost to Federal credit 
unions, vending stands operated by blind persons and child care 
centers.
    These are the entities which, under the policy guidance, 
are affected by those programs, and which, therefore, are 
covered by this policy guidance issued by the GSA. In being--it 
then goes into great detail of what they're being required to 
do regarding making translations from Englishinto an unlimited 
number of other languages available at their expense, both oral and 
written. It even has recommendations that sometimes you probably need 
to hire two different people to provide the translation services to 
make sure they're accurate and so forth. And it goes on to say that 
enforcement--enforcement--well, first, it says compliance. It states 
that all recipients--and I described the category of recipients. 
Paragraph 13 says, all recipients must take reasonable steps consistent 
with this policy guidance to overcome language differences that result 
in barriers and provide the language assistance needed to ensure that 
persons with LEP, limited English proficiency, have meaningful access 
to services and benefits. Paragraph 14 goes into enforcement, that it's 
going to be GSA's Office of Civil Rights will be enforcing this, and 
including compliant investigations, compliant reviews--compliance 
reviews, efforts to secure voluntary compliance and technical 
assistance, and it goes on to state that they will follow existing 
procedures under the Code of Federal Regulations if people do not 
comply, which I presume would mean that entities such as I've described 
would lose their ability to participate in these GSA programs to 
receive surplus government property or to use government services at 
little or no cost under the designated circumstances, that these are 
going to be enforced by GSA, which can include removal of a large 
number of entities from participation in those programs. All of this, 
of course, without any act of Congress that says that this is the law 
or this is what's supposed to be done.
    Do you have any idea, Mr. Davis, how many people and 
institutions and entities would be affected by this guideline 
that GSA has issued, and have they been notified about it?
    Mr. Davis. Well, the first part, quite a few people would 
be, from what you're describing to me.
    Mr. Istook. Certainly.
    Mr. Davis. And I have to admit to you, I'm completely cold. 
I need to go back and find out what all this is about. But 
quite a few people would be affected, and I'm somewhat 
surprised, really. I need to go back and find out where we are 
and get back to you.
    [The information follows:]

                       LEP Guidance to Recipients

    The requested information on how many people, institutions 
and entities would be affected by GSA guidelines is not readily 
available for all programs. GSA is currently compiling the 
information and will furnish this data to the Committee upon 
its completion. Concerning notification, the Office of Civil 
Rights is in the process of notifying those entities and 
institutions by sending out videos to recipients explaining LEP 
and by meeting with recipients during on-site compliance 
reviews.

    Mr. Istook. Certainly. And I appreciate, I understand you 
may not have personal familiarity with it, but I don't think 
the entities that are about to be cut off from their 
participation in programs established by Congress are aware of 
it either, and I can only imagine, you know, even if GSA were 
trying to notify all these people of what it says is their 
legal requirement and that GSA is going to be enforcing it 
through its Office of Civil Rights, I think they would be very 
surprised. And I imagine they would be very angry and coming to 
GSA, coming to the Congress, going to the White House, and 
saying, do you realize what kind of burden you're imposing upon 
us and the cost of it and the enormous uncertainty? If you read 
through--I mean, I haven't hit all the high points in this 
particular document, but it was published by GSA, and it states 
that it's effective immediately. That was on January 17th. It 
also says comments are to be submitted on or before March 20th. 
I'd certainly like to know what feedback you got, but, again, I 
think most people in this Nation are totally unaware of this, 
and I think most of the affected people--I think by reading 
this obviously the number of people affected would be in the 
millions, that they are unaware of this, and we don't want them 
to find out by somebody saying, got you, when they file a 
complaint with GSA's Office of Civil Rights. And I don't know 
how much it might cost us in the appropriations of GSA to fund 
the kind of investigations and compliance efforts that this 
document outlines.
    So I think there's a very severe problem. It's not limited 
just to GSA. It's other government agencies also, pursuant to 
that executive order that was issued last August, but as I say, 
not pursuant to an act of Congress and relying on court 
decisions that have been overturned by the U.S. Supreme Court.
    So I would appreciate certainly your responses to the 
record relating to this, and your review of what you're going 
to do, whether you're going to rescind this, whether--you know, 
or if you think it's justified, how people whose rights are 
dramatically affected would be notified by this. But I think 
it's an enormous burden upon taxpayers, upon nonprofit groups, 
upon government agencies, schools, I mean, even vending stands 
operated by the blind, as it states. And I certainly don't want 
us to have to appropriate untold millions of dollars for GSA to 
be involved in trying to enforce this particular policy 
guideline, as it's called. And evidently--and I know you'll 
correct me if--if you're mistaken. Evidently it seems to be 
very unique in the history of GSA, and it was published, as I 
say, on January 17th.
    Mr. Davis. We will get back to you on that.
    [The information follows:]

                     Status of LEP Policy Guidance

    The Policy Guidance was drafted in direct response to 
Executive Order 13166, which is under the jurisdiction of the 
Department of Justice (DOJ). We are awaiting further guidance 
from DOJ, who is awaiting a formal announcement from the White 
House. At that time a decision will be made regarding LEP.

    Mr. Istook. I appreciate that, Mr. Davis, and I realize 
it's always a challenge when you have things brought up for 
which you're not prepared to respond, but that's just part of 
the price of dealing with a large government agency and 
handling it.
    Mr. Davis. Yes, sir.
    Mr. Istook. We certainly have other things that we'll be 
submitting for the record. I appreciate your remaining, and 
we'll look forward to getting that further information.
    Mr. Davis. Okay.
    Mr. Istook. Thank you very much, and the hearing is 
adjourned.


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                           W I T N E S S E S

                              ----------                              
                                                                   Page
Barton, W.R......................................................   841
Bates, S.N.......................................................   841
Bennett, D.D.....................................................   841
Chistolini, Paul.................................................   841
Cohen, S.R.......................................................  1579
Comstock, A.L....................................................  1474
Daniel, J.F......................................................     1
Daniels, M.E., Jr................................................   243
Davis, T.M., Sr..................................................   841
Larsen, P.D......................................................     1
Mason, D.M.......................................................   611
Slavet, B.S......................................................  1271
Wagner, G.M......................................................   841
Wells, Chief Judge T.B...........................................  1909


                               I N D E X

                              ----------                              --
--------
                                                                   Page
Executive Office of the President:
    Budget Justification.........................................   123
    Chief Financial Officer......................................    24
    Detailee Policy..............................................    30
    Electronic Documents Management System.......................    28
    Executive Residence..........................................    32
    Faith-based Initiative.......................................29, 34
    Impact of Nomination Process.................................    32
    Information Technology.......................................    22
    Information Technology Architecture..........................    22
    National Security Council....................................    33
    Opening Remarks, Chairman Istook.............................     1
    Opening Statement, Chairman Istook...........................     4
    Opening Statement, Phillip Larsen............................    12
    Questions Submitted by the Committee.........................    36
    Security Enhancements at the Vice-President's residence......    33
    Telephone System.............................................    23
    Transition Activities........................................     8
    Unanticipated Needs..........................................    25
    Vice-President's Residence Utilities.........................    26
    White House Staffing.....................................24, 30, 34
Executive Residence at the White House: Budget Justification.....   225
Office of Management and Budget:
    Budget Justification.........................................   421
    Budget and Performance Integration...........................   262
    Budget Resolution............................................   263
    E.O. 13166, ``Improving Access to Services for Persons with 
      Limited English Proficiency''............................253, 268
    Federal Employee Pay Comparability Act (FEPCA).............256, 257
    First Accounts Program, CDFI and Secret Service..............   266
    Opening Statement, Chairman Istook...........................   246
    Opening Statement, Director Daniels..........................   249
    OMB's Management Agenda......................................   255
    Paperwork Reduction Act......................................   265
    Privatization................................................   259
    Questions Submitted by the Committee.........................   272
    Representative Hoyer.........................................   297
    Representative Meek..........................................   325
    Representative Northup.......................................   319
    Representative Price.........................................   323
    Representative Rothman.......................................   318
    Representative Tiahrt........................................   315
    Secure Our Schools Act.......................................   260
    Selection Reform.............................................   270
    Treasury Department Law Enforcement..........................   269
Office of National Drug Control Policy:
    Acting Director Edward H. Jurith's Written Statement.........   443
        Introduction.............................................   443
        Current Drug Use Trends..................................   444
        The Consolidated Fiscal Year 2002 Drug Control Budget....   446
        ONDCP's Coordinating Role................................   447
        ONDCP's FY 2002 Budget Request...........................   448
        Conclusion...............................................   460
    Questions for the Record.....................................   461
    ONDCP's Fiscal Year 2002 Budget Submission...................   502
    Letter to Representative Meek from OMB Director Mitchell E. 
      Daniels, Jr................................................   582
Committee for Purchase From People Who Are Blind or Severely 
  Disabled: Budget Justification for FY 2002.....................   585
Federal Election Commission:
    Statement Submitted by David M. Mason, Vice Chairman.........   611
    Questions for the Record Submitted by the Subcommittee.......   625
    Budget Justification for FY 2002.............................   640
Federal Labor Relations Authority: Budget Justification for FY 
  2002...........................................................   791
General Services Administration:
    Alternative Fuel Vehicles....................................   865
    Alternative Fuel Vehicles, Sale of...........................   884
    Barton, Recognition of William...............................   842
    Capital Program..............................................   844
    Capital Program, Fiscal Constraints on.......................   877
    Computer Security, Collaboration for.........................   883
    Computer Security Incidents..................................   883
    Contract Guards at Federal Buildings.........................   885
    Contract Guards, Increase in Number of.......................   886
    Courthouse Construction Request..............................   876
    Courthouse Priorities........................................   892
    Courthouse Program, Additional...............................   877
    Courthouse Program, Impact of Not Fully Funding..............   877
    Courthouses, Criteria for Construction/Alteration of.........   891
    Courtroom Sharing............................................   892
    Court Space, Need for Additional.............................   895
    Davis, Statement of Mr.....................................843, 846
    Dearie, Statement of the Honorable Raymond J.................   912
    Hammond, IN Courthouse Budget................................   895
    Hammond, IN Courthouse, Delay of.............................   894
    Hammond, IN Courthouse, Status of............................   893
    Disagreements Concerning Design..............................   891
    Durham, Locating Federal Offices in..........................   880
    Electronic Government........................................   844
    EPA Facility, Move Scheduled for.............................   879
    EPA Facility--Research Triangle Park.........................   879
    Federal Buildings Fund.......................................   842
    Energy Costs, Federal Buildings Projected....................   866
    Energy, Long-term Contracts to Purchase......................   867
    Energy Prices and Consumption, Rising........................   865
    FSS Schedule 1122 Program..................................880, 887
    GSA Coordination with Congress...............................   889
    Limited English Proficiency (LEP), Guidance Regarding........   896
    Hoyer, Opening Statement of Mr...............................   863
    Istook, Opening Statement of Chairman........................   841
    Judiciary Latitude in Courtroom Construction.................   893
    Judiciary's Five-Year Plan...................................   878
    Miami Courthouse, Cost of....................................   893
    Miami Courthouse Project, Status of..........................   891
    New Technologies.............................................   882
    Overnight Package Delivery Rates.............................   883
    Privatizaton.................................................   887
    Repairs and Alterations Backlog..............................   882
    Repairs and Alteration Projects, Criteria for Selecting......   881
    Repairs and Alterations Request..............................   881
    Repairs to the Peter Rodino Federal Building.................   885
    Roth, Statement of Judge Jane R..............................   902
    Security Improvements........................................   882
    Consumer Products Safety Commission Project, Status of.......   891
    Timetable for New Administrator..............................   864
U.S. Merit Systems Protection Board:
    Statement Submitted by Beth S. Slavet, Chairman..............  1271
    Budget Justification for FY 2002.............................  1280
National Archives:
    Questions for the Record Submitted by the Subcommittee.......  1297
    Budget Justification for FY 2002.............................  1351
U.S. Office of Government Ethics: Budget Justification for FY 
  2002...........................................................  1473
Office of Personnel Management:
    Statement Submitted by Steven R. Cohen, Acting Director......  1549
    Questions for the Record Submitted by the Subcommittee.......  1561
    Statement Submitted by Patrick E. McFarland, Inspector 
      General....................................................  1673
    Budget Justification for FY 2002.............................  1678
Office of Special Counsel: Budget Justification for FY 2002......  1859
U.S. Tax Court:
    Statement Submitted by Chief Judge Thomas B. Wells...........  1879
    Budget Justification for FY 2002.............................  1881

                                
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