[Senate Hearing 108-543]
[From the U.S. Government Publishing Office]



 
         LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 2005

                              ----------                              


                        THURSDAY, MARCH 11, 2004

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 11 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Ben Nighthorse Campbell (chairman) 
presiding.
    Present: Senators Campbell and Stevens.

                          LIBRARY OF CONGRESS

STATEMENT OF HON. JAMES H. BILLINGTON, THE LIBRARIAN OF 
            CONGRESS
ACCOMPANIED BY:
        DONALD L. SCOTT, DEPUTY LIBRARIAN OF CONGRESS
        JO ANN C. JENKINS, CHIEF OF STAFF, OFFICE OF THE LIBRARIAN
        LAURA CAMPBELL, ASSOCIATE LIBRARIAN FOR STRATEGIC INITIATIVES
        RUBENS MEDINA, LAW LIBRARIAN
        DANIEL P. MULHOLLAN, DIRECTOR, CONGRESSIONAL RESEARCH SERVICE
        MARYBETH PETERS, REGISTER OF COPYRIGHTS
        DEANNA MARCUM, ASSOCIATE LIBRARIAN FOR LIBRARY SERVICES
        FRANK KURT CYLKE, DIRECTOR, NATIONAL LIBRARY SERVICES FOR THE 
            BLIND AND PHYSICALLY HANDICAPPED
        KENNETH E. LOPEZ, DIRECTOR OF SECURITY
        MARY LEVERING, ACTING DIRECTOR, INTEGRATED SUPPORT SERVICES
        JOHN D. WEBSTER, CHIEF FINANCIAL OFFICER
        KATHRYN B. MURPHY, BUDGET OFFICER, OFFICE OF THE CHIEF 
            FINANCIAL OFFICER

          OPENING STATEMENT OF SENATOR BEN NIGHTHORSE CAMPBELL

    Senator Campbell. The subcommittee will come to order.
    We meet today to hear from Dr. James Billington, Librarian 
of Congress, on the fiscal year 2005 request for the Library of 
Congress. Dr. Billington will also have testimony for the 
record on the Open World Leadership Program.
    Dr. Billington is accompanied by the Deputy Librarian, 
General Donald Scott, and a team of others; and we welcome you 
this morning.
    The Library is requesting almost $563 million, an increase 
of 7.6 percent over the current year. In addition, a total of 
$161 million is requested by the Library buildings and grounds 
appropriation, under the Architect of the Capitol.
    Clearly, there are many critical areas for which the 
Library seeks increases, including funding activation of the 
new audiovisual conservation center in Culpeper, Virginia, and 
increasing acquisition costs, in addition to routine payroll 
and inflationary increases. With the increases being requested, 
this budget will be very tough to accommodate in the budget 
environment we face this year, so we will be looking to you to 
prioritize and to help us make some very difficult choices as 
we move forward. Thank you very much.
    The chairman of the full committee is here this morning and 
I would like to yield to him.

                    STATEMENT OF SENATOR TED STEVENS

    Senator Stevens. Well, thank you very much. I am glad to be 
here with Dr. Billington and General Scott, but I cannot stay 
long because of other matters. I did want to come and show my 
support, basically, for the programs that are outlined in the 
budget. And I agree with you, it is going to be a difficult 
year. I want to make sure that we do the best we can to help 
the Library. Thank you.
    Senator Campbell. Dr. Billington, if you would like to 
proceed. Your complete testimony will be included in the 
record; as General Scott's will, too, if he has any comments.

            PREPARED STATEMENT OF SENATOR RICHARD J. DURBIN

    Before you proceed, Dr. Billington, we have received a 
statement for Senator Durbin who could not make it today, but 
asked that his statement be submitted for the record.]
    [The statement follows:]

            Prepared Statement of Senator Richard J. Durbin

    Mr. Chairman, thank you for scheduling today's budget 
oversight hearing on the Library of Congress and the Open World 
Leadership Center.
    I want to welcome you Dr. Billington. It has been a 
pleasure working with you in your capacity as Librarian of 
Congress. My staff informs me that you are now in your 18th 
year as the Librarian. I would also like to welcome the Deputy 
Librarian, General Donald Scott, to today's hearing.
    I recently had the opportunity to visit the Churchill 
Exhibit. It was extremely well done and I enjoyed it 
tremendously.
    Your fiscal year 2005 budget request is 7.6 percent over 
the fiscal year 2004 enacted level. While this is not as high 
as some of our legislative branch agencies' requests, it is 
rather high. I hope you will shed some light on your priorities 
so we can make informed decisions in what promises to be a very 
tight year.
    I understand that due to security upgrades at the Jefferson 
Building the retail store has been relocated. I hope you will 
talk a little bit about how the retail sales are going, both 
from the shop and from the Library's website, and what affect, 
if any, relocating the shop will have on its visibility to 
visitors to the Library.
    I'd like to hear about how your security needs at the 
Library are being addressed. I noticed in your budget request 
that you are asking for an additional 45 police personnel. I 
hope you will address the need for these extra personnel to the 
subcommittee, particularly in light of the pending merger of 
your force with the Capitol Police.
    I'm very happy with the continuing success of the Open 
World Leadership Center. The United States just hosted the 
first delegation from Lithuania and I understand it went quite 
well. I congratulate you on the success of this program, Dr. 
Billington.
    I hope you will provide us with an update on the Culpeper 
National Audio-Visual Conservation Center. I noticed a request 
for $5.28 million and 16 FTEs in your budget. It would be 
helpful to know the particulars of the request and the need for 
extra personnel.
    You are requesting $160.7 million in Library of Congress 
building projects under the Architect of the Capitol. In light 
of our tight budget constraints, I hope you will explain to the 
subcommittee what your priorities are for these projects.
    I'd also like to hear more about the Veterans' History 
Project.
    I'm anxious to hear more about your technological advances 
to the Blind and Physically Handicapped Program. I hope you 
will describe to the subcommittee the Digital Talking Book 
Machine.
    Thank you both for attending today's hearing. I look 
forward to hearing your testimony.
    Thank you, Mr. Chairman.

      INTRODUCTION OF THE ASSOCIATE LIBRARIAN FOR LIBRARY SERVICES

    Dr. Billington. Thank you, Mr. Chairman. First, I would 
like to introduce Deanna Marcum, our new Associate Librarian 
for Library Services.
    She is coming back to the Library from a decade-long 
position as President of the Council on Library and Information 
Resources, which is the only think-tank in the world, Mr. 
Chairman, devoted exclusively to library concerns.
    She was with us before as Director of Public Service and 
Collection Management at the Library of Congress; and she was 
previously Dean of the Library School at Catholic University. 
So, we are very fortunate and grateful to have her with us.

                   OPENING STATEMENT OF THE LIBRARIAN

    The Library, Mr. Chairman, in many ways can be seen as the 
Nation's strategic information reserve, at a time when our 
security, economic competitiveness, and our creative dynamism 
is increasingly dependent on information. The Library provides 
America with the world's largest and most diverse collection of 
retrievable human knowledge. At the same time, it is the mint 
record of American private sector creativity and a world leader 
in freely distributing high-quality material on the Internet.
    From this time last year to this year, we estimate that we 
had about 3 billion electronic transactions. At the same time, 
we are digitally transforming our internal processes, ranging 
from re-engineering the Copyright Office to moving into new 
user-friendly digital materials for the blind and physically 
handicapped.
    We are also developing a national plan to store digital 
collections, even as we continue to add 10,000 new analog items 
to the Library every day. We are doing all this with 7.7 
percent fewer full-time equivalent staff than we had in 1992, 
before all this began, and with a magnificent but somewhat 
aging workforce, 25 percent of whom will be eligible for 
regular retirement by September of this year with potentially 
another 23 percent, if early retirement is offered as an option 
at the Library.
    Guided by our strategic plan and a rigorous review process, 
we are requesting some resources needed to continue performing 
our statutory obligations and core mission for Congress and the 
Nation. We must increase our modest acquisition budget for 
traditional print materials, which are growing by an estimated 
15 percent, particularly in troubled regions of the developing 
world that are of concern to American foreign policy.

           ACQUISITION AND PRESERVATION OF LIBRARY MATERIALS

    In our extraordinary Arabic collections, we discovered an 
autobiography of Osama Bin Laden and two volumes of 
Afghanistan's traditional laws, that were destroyed by the 
Taliban. These were, in part, reconstructed largely by our Law 
Library, which digitized them within 24 hours for distribution 
to 1,000 institutions in Afghanistan. So, these acquisitions 
are extremely important and we must also adequately preserve 
and store them. We have 128 million analog items.

                            NAVCC--CULPEPER

    By far the largest private gift ever received by the 
Library, is an unprecedented $120 million, which is being 
donated by the Packard Humanities Institute. This is to build a 
national facility for housing the audiovisual heritage of 20th 
century America, where much of the world's history and of our 
Nation's creativity is preserved, but in presently fragile and 
perishable forms at widely scattered locations.
    This will be a state-of-the-art facility in Culpeper. The 
construction is already well underway but it requires some 
modest, largely one-time increases in our own budget to equip 
it, to prepare for the move, and to sustain for the future of 
the good relationship with our extremely generous donor.

                          FORT MEADE PROJECTS

    We are also requesting in the Architect of the Capitol's 
budget, continuation of the Fort Meade storage project for 
specially formatted collections. About 15 million of them will 
be housed here in accordance with a plan previously discussed 
with the committee. We also need a copyright deposit facility 
for housing the vast, but presently scattered, creative record 
of America into one location. This is needed to fulfill our 
preservation obligations to depositors and to assure 
continuation of the voluntary deposit system that annually 
provides more than $30 million worth of material for the 
Library's collections. These occur, actually, in the 
Architect's budget.

                         FLEXIBLE HIRING TOOLS

    Now, the single greatest challenge facing the Library in 
the digital age is to develop a workforce that can think and 
work in new ways, without losing the immense inherited 
traditional knowledge and memory embedded in our staff. We will 
soon need the committee's support for a package of flexible 
human capital tools, in line with practices already in use 
within the Federal Government. The Library simply must be able 
to train a new type of objective knowledge navigator, to 
provide Congress and the Nation with seamlessly integrated old 
analog and the new digital materials.

                             POLICE MERGER

    With regard to the police merger, Mr. Chairman, the Library 
is fully engaged in increasing security, integrating police 
operations, and improving budget economy here on Capitol Hill. 
We are, however, deeply troubled by the proposed plan that the 
U.S. Capitol Police have issued for implementing the merger of 
the Library's police force with that of the U.S. Capitol.
    The proposed plan that the U.S. Capitol Police have 
submitted for congressional approval does not protect the 
statutory responsibilities that we bear and the distinct 
problems connected with protecting the collections, as well as 
the buildings and people of the Library. The merger is 
happening de facto and is eroding the Library's authority to 
exercise this core task, since we no longer can hire our own 
police.

                   NATIONAL FILM PRESERVATION PROGRAM

    The Library also submitted, during the first session of the 
108th Congress, a request for re-authorization of the National 
Film Preservation Program that has brought 375 motion pictures 
into the National Film Registry, which was created by Congress 
in 1988. This program has played the leading role in 
identifying endangered films, and setting national preservation 
standards, and working with other archives to save American 
films of all kinds from otherwise irreversible deterioration.

                          PREPARED STATEMENTS

    On behalf of the Library and all of its staff, I want to 
thank this committee for its continued support for, and 
interest in, the Library. Individual members of this committee 
have provided continuity and guidance for the Library. We are 
all in your debt and we will be happy to answer your questions.
    Senator Campbell. Thank you, Dr. Billington.
    [The statements follow:]
               Prepared Statement of James H. Billington
    I appreciate the opportunity to discuss the Library of Congress 
budget request for fiscal year 2005. This unique institution has become 
increasingly important to the nation as the economic and security needs 
become increasingly dependent on knowledge and the wise use of 
information. All libraries--and especially the Library of Congress--
must deal with the greatest upheaval in the transmission of information 
and knowledge since the invention of the printing press--the electronic 
onslaught of digitized information and communication. The Library is 
responding to this challenge, with program-focused goals and objectives 
contained in our new strategic plan, which was forwarded to the 
Congress in September 2003. The plan will undergo continuous 
improvement to ensure our place as the foremost library of the 21st 
century.
    The Library's mission is unchanging--to make its resources 
available and useful to the Congress and the American people and to 
sustain and preserve a universal collection of knowledge and creativity 
for future generations. What is new is the need to acquire, sort, and 
provide access to the massive unfiltered content of the Internet in 
order to keep our collections universal and continue to provide full 
information and services to Congress and the American people.
    The Library must continue to acquire, preserve, and provide access 
to analog collections with new storage facilities and mass 
deacidification. At the same time, the Library must implement 
fundamental technological changes to accommodate the digital 
revolution. Both collections and staff are being reconfigured by new 
initiatives in digital preservation, digital talking books, and 
Copyright reengineering, and by the increased reliance on digital 
services. The fiscal year 2005 budget request addresses this 
``Challenge of Change; Maintenance of Tradition.''
    The priorities of our fiscal year 2005 budget, reflecting the major 
objectives in the Library's strategic plan, are: to bring the National 
Audio Visual Conservation Center into operation; to restore the 
diminished acquisition capabilities for our collections; to regain full 
funding for the Congressional Research Service staff capacity at 729 
full-time-equivalent (FTE) positions; to implement the Copyright 
Office's reengineered processes; to support the conversion to digital 
talking book technology for people who are blind and physically 
handicapped; to fund the fifth increment of the Library's mass 
deacidification program; to accelerate the Veterans History Program; to 
gain additional security for the Library's systems, staff, buildings, 
and collections; and to address critical infrastructure support 
requirements.
    For fiscal year 2005, the Library of Congress requests a total 
budget of $602.3 million ($562.6 million in net appropriations and 
$39.7 million in authority to use receipts), a total increase of $43.0 
million above the fiscal year 2004 level. The total increase includes 
$20.5 million for mandatory pay and price-level increases and $34 
million for program increases, offset by $11.5 million for non-
recurring costs. The Library's fiscal year 2005 budget request is a net 
appropriations increase of 7.6 percent above that of fiscal year 2004. 
The Library has submitted a fiscal year 2005 budget amendment, which is 
reflected in the above numbers, that increases the net appropriations 
amount by $1 million, which is discussed under the headings ``Copyright 
Office'' ($.8 million) and the ``Sustaining the Collections'' ($.2 
million).
    Requested funding supports 4,363 FTE positions, a net increase of 
80 FTEs above the fiscal year 2004 level of 4,283. The 80 additional 
FTEs are requested to support the core needs of the collections, 
security, and management.

                     THE LIBRARY OF CONGRESS TODAY

    The core of the Library is its incomparable collections and the 
specialists who interpret and share them. The Library's 128 million 
items include almost all languages and media through which knowledge 
and creativity are preserved and communicated.
    The Library has more than 29 million books and other print items; 
12 million photographs; 4.8 million maps; 2.7 million audio materials; 
925,000 films, television, and video items; and 57 million manuscripts.
    Every workday, the Library's staff adds some 10,000 new items to 
the collections. Major annual services include handling more than 
875,000 on-line and customized Congressional inquiries and requests, 
registering more than 534,000 copyright claims, and circulating 
approximately 23.8 million audio and braille books and magazines free 
of charge to blind and physically handicapped individuals all across 
America. The Library annually catalogs more than 300,000 books and 
serials and provides the bibliographic record inexpensively to the 
nation's libraries, saving them millions of dollars annually.
    The Library also provides free on-line access, via the Internet, to 
its automated information files, which contain more than 75 million 
records, including more than 8.5 million multimedia items from its 
American Memory collections. The Library's acclaimed Web site 
(www.loc.gov) will record more than 3 billion hits in 2004.

                          21ST CENTURY LIBRARY

    As impressive as the everyday work of the Library of Congress is, 
we recognize the need to address the future. All libraries are rapidly 
changing in response to new digital technologies. The Library of 
Congress, like other research libraries, is building digital 
collections, making them readily accessible on-line, and developing 
search services previously not feasible. Digital technology also 
benefits smaller libraries because it allows them to expand and enhance 
resources for their patrons in colleges, schools, and communities. 
Libraries, in effect, are moving their catalogs and collections from 
physical buildings into patron's computers and are transforming their 
individual storage repositories into collaborative information-service 
centers. As this transformation continues, 21st century libraries will 
develop in the following significant ways: libraries will collect at 
the point of creation rather than after publication; libraries will 
complement classification systems with simpler search services; 
libraries will work with information creators and publishers to create 
digital preservation repositories; libraries will work with legislators 
to balance copyright against access needs; and libraries will retrain 
print oriented staffs for digital information services.
    In a world in which Google is the preferred search mechanism, the 
library of the future will be less the custodian of a collection in a 
physical building than a guide to Internet-accessible resources and a 
creator and provider of on-line information services. Realizing this 
library of the future depends on providing opportunities for today's 
librarians to learn to take advantage of digital developments and on 
integrating this new digital technology into the basic library 
processes of acquisition, cataloging, preservation, and reference 
services. The Library's strategic plan and this fiscal year 2005 budget 
request are helping guide us in making this inevitable change to a 21st 
century library.

                    FISCAL YEAR 2003 ACCOMPLISHMENTS

    Even as the Library plans for a dramatic new future, the immediate 
challenges continue to be addressed. In fiscal year 2003, the Library 
provided concerted congressional research support in more than 150 
major policy areas, including terrorism, health care, the U.S. economy, 
environmental and resource issues, and space exploration. The Library 
supported the war effort by making information and services available 
to the Congress as it executes its constitutional responsibilities, by 
documenting for future generations the war as it progresses, and by 
helping reconstruct the national libraries in Afghanistan and Iraq. 
Specifically, the Law Library helped reconstruct the destroyed law 
codes of Afghanistan from its collections.
    The Library also received congressional approval for the plan for 
the National Digital Information Infrastructure and Preservation 
Program; expanded the Global Legal Information Network to include the 
laws of 48 countries and international organizations; added seven new 
multimedia historical collections to the American Memory Web site; 
increased to more than 8.5 million the number of items freely available 
on-line or in digital archives; recorded more than 2.6 billion 
electronic transactions on the Library's Web sites; registered more 
than 534,000 copyright claims; added more than 1.8 million items to our 
collections; opened the off-Capitol Hill storage facility at Fort 
Meade, Maryland; and produced more than 2,700 new braille, audio books, 
and magazine titles for the blind and physically handicapped. Private 
funding enabled the Library to make notable new acquisitions, including 
the great Alan Lomax collection of Americana, and brought into 
residence a distinguished new cohort of invited senior scholars and 
competitively chosen junior researchers in the Thomas Jefferson 
Building with the opening of the John W. Kluge Center.

            NATIONAL AUDIOVISUAL CONSERVATION CENTER (NAVCC)

    An increase of $5.28 million and 16 FTEs is requested for the 
NAVCC, a projected state-of-the-art facility for audiovisual 
collections. These funds are needed to continue the construction of the 
NAVCC and to begin the move-in of collections and staff of the Motion 
Picture, Broadcasting and Recorded Sound Division of the Library. The 
Packard Humanities Institute (PHI) is generously providing the majority 
of the funding to build the NAVCC--consolidating in one place and 
enhancing film and recorded sound preservation. The Library continues 
to work closely with PHI representatives and the Architect of the 
Capitol (AOC) on this much-needed project.
    Construction on this national repository for America's audiovisual 
treasures began in early September 2003, and the current schedule calls 
for the newly renovated Collections Building and Central Plant to be 
ready for collections to be moved in by summer 2005. The new Nitrate 
Vaults and Conservation (Laboratory) Building is scheduled to be ready 
for staff move-in by summer 2006. The Library's ability to procure, 
deliver, and install NAVCC furnishings, equipment, and infrastructure 
will require close coordination with PHI's construction schedule. The 
requested additional funding in the current budget is essential to 
maintain the construction schedule and the various components and 
procurements that support the transition to the new facility. Fiscal 
year 2005 funding will support staff relocation, collections 
relocation, and the design, procurement, and integration of the complex 
digital preservation systems within the NAVCC's audiovisual 
laboratories.
    The NAVCC will enable the Library to redress significant 
limitations in its current ability to store, preserve and provide 
access to its moving image and recorded sound collections. When the 
entire NAVCC complex is opened in 2006, the Library for the first time 
will be able to consolidate all of its collections in a single, 
centralized storage facility that provides space sufficient to house 
projected collections growth for 25 years beyond the NAVCC move-in 
date. Without the NAVCC, the Library's current preservation rate would 
result in the preservation of only 5 percent of its total endangered 
sound and video materials by the year 2015. By contrast, we project 
that the new NAVCC laboratories will enable us to preserve more than 50 
percent of these endangered collections in the same 10-year period 
after move-in. The NAVCC will also include a Digital Audiovisual 
Preservation System that will preserve and provide research access to 
both newly acquired born-digital content and analog legacy formats. 
This new system is contributing to the Library's overall development of 
a digital content repository and signals a new paradigm of producing 
and managing computer-based digital data.
    The Packard Humanities Institute's contribution to building this 
new state-of-the-art facility will represent the largest private 
donation to the Library of Congress in its entire history.

                       SUSTAINING THE COLLECTIONS

    Acquiring timely and comprehensive collections for the National 
Library and Law Library as well as the highly specialized research 
materials required for the Congressional Research Service (CRS) is 
among the most essential tasks the Library performs. All else depends 
on acquiring needed materials--preferably at the time they appear on 
the market. The rising tide of new kinds of knowledge and new formats 
make it essential that the Library address the already-serious 
catastrophic projected shortfalls in these areas. A total of $4.462 
million and seven FTEs are requested for addressing--for the first time 
in many years--this critical area. Lost purchasing power and the 
increased complexity and cost of acquiring proprietary electronic 
resources make this a critical problem that must be addressed.
    Serial subscriptions prices alone have increased by 215 percent 
over a 15-year period ending in 2001, yet the Library's GENPAC 
appropriation--used to purchase library materials--has grown at an 
annual average rate of only 4 percent. These shortfalls accumulated 
because the Library understated annual price-level increases for 
research materials. The Congress, in most years, has supported the 
Library's modest requests for inflationary increases in research 
materials, but the Library's methodology did not adequately factor in 
the value of the dollar, the sharp escalations in market prices for 
serials, budget rescissions, and the changes in how research materials 
are packaged and sold. The Library's fiscal year 2005 acquisitions 
budget proposals include funding for the recovery of lost purchasing 
power (a one-time increase to the Law Library [$205,000] and CRS [$1 
million], and a one-time and incremental increase in the National 
Library [$2.333 million]), for a total of $3.538 million. The $3.538 
million request includes a $.2 million budget amendment for the CRS 
element; the original CRS catchup amount was determined through fiscal 
year 2004 rather than fiscal year 2005. During the next year, the 
Library will develop a new formula that will adequately reflect the 
inflationary increases for research materials beginning in fiscal year 
2006.
    In addition, $479,000 and 7 FTEs are requested to support the new 
acquisitions methodology and policy that has been successfully piloted 
in China. Collecting materials published in China is difficult, but a 
three-year pilot project, funded by private donations, successfully 
demonstrated that the Library can acquire high quality, hard-to-obtain 
and politically sensitive materials, which traditional channels are not 
providing. Funding of $479,000 is requested to establish six teams of 
experts in the social sciences, located at carefully selected sites 
throughout China. The teams will recommend materials from their 
regions, which will then be shipped by the Library's established 
vendors. The Library's pilot program has proven that important added 
information about China can be obtained in this way. The Library 
requests funding to make this a permanent acquisition process for the 
world's largest country as it assumes an even-greater world role.
    Lastly, $445,000 is needed to allow the Law Library to begin 
properly reclassifying 800,000 volumes or one-third of its legal 
collections from the ``LAW'' class--previously used to shelve legal 
materials--to the ``Class K,'' (the new international standard for the 
classification of legal materials that was developed by the Library of 
Congress). Currently, one out of every four foreign legal documents 
cannot be located because of the outdated classification system, and 
the inevitable change to the new ``Class K'' cataloging system is 
required to effectively provide foreign legal research. The five-year 
project would enable the Law Library to meet its own cataloging 
standards before the few remaining staff with the experience and 
knowledge of the outdated ``LAW'' class cataloging leave or retire.

                           CRS STAFF CAPACITY

    In fiscal year 2005, CRS must face the increased cost of sustaining 
the research capacity needed to meet the legislative needs of the 
Congress. CRS is requesting a base increase of $2.71 million--the 
equivalent of about 25 FTEs. During the past ten years, the total size 
of CRS has decreased from 763 to 729. However, the salary costs per 
person have increased at a rate that exceeds the funding provided in 
the budget process. Without the proposed base increase, CRS would have 
to staff down further to a level of about 704 FTEs. The impact of this 
reduction would be a loss of CRS capacity in serving the Congress of 
about 275 hours a year in each of more than 150 major policy areas in 
which the Congress can be expected to be engaged. CRS would lose 
between eight and nine weeks of capacity per major policy area.
    CRS has been evaluating workforce opportunities and authorities to 
improve the productivity, efficiency, and attractiveness of CRS as an 
employer. During fiscal year 2003, CRS hired approximately 90 new 
staff--nearly 13 percent of the total staff population. To enhance 
retention of new staff and to further staff development Service-wide, 
CRS is requesting $546,000. This funding would be used to initiate a 
pilot student loan repayment program, to increase slightly its training 
and related travel budgets, and to provide monetary incentive awards to 
the Service's most highly talented and productive employees. The CRS 
Director will provide more details of this request in his statement.

                            COPYRIGHT OFFICE

    The Copyright Office's Reengineering Program, which will be 
completed in fiscal year 2006, requires additional funding authority 
for fiscal year 2005. The extensive multiyear Reengineering Program has 
redesigned the Office's business processes, developed a new information 
technology infrastructure, created new work-flows and new job roles, 
and developed a new facilities plan. The program will allow the 
Copyright Office to replace outdated information systems with 
technology that promotes the use of electronically transmitted 
applications and works. The Library requests $3.66 million, in budget 
authority and equal offsetting collections authority (zero net 
appropriations), in order to implement the facilities portion of the 
Reengineering Program. This funding will support relocation of staff, 
redesign and construction of current space, and acquisition of 
furniture and other equipment.
    In developing the fiscal year 2005 budget request, inflationary 
factors for mandatory pay and price level increases were applied to 
both the Copyright Office's net appropriated funds and receipts funds. 
In reviewing this approach and upon further analysis, the Library has 
determined that the increases needed to cover inflationary growth 
cannot be met by the initially requested receipt level. As a result, 
the Library is requesting, via a budget amendment, that the fiscal year 
2005 receipt level be reduced by the inflationary adjustment of 
$810,000, with a corresponding increase in net appropriations. The 
Register of Copyrights will provide in her statement more details about 
the Reengineering Program and this adjustment.

                      DIGITAL TALKING BOOK MACHINE

    In support of the Blind and Physically Handicapped (BPH) program, 
the National Library Service (NLS) for the BPH is implementing a 
revolutionary change from analog to digital technology, which has been 
projected and planned since the early 1990s. The service will replace 
cassette tape players with Digital Talking Book (DTB) players and 
introduce a new medium for distributing the DTBs: solid-state 
(``flash'') memory, replacing the present cassette tape.
    NLS plans to introduce the DTB players to its customers by fiscal 
year 2008. The Library is requesting a total of $1.5 million in fiscal 
year 2005, of which $1 million will support the beginning of the design 
phase of the DTB player. In concert with the development of a DTB 
player, NLS will begin converting its current analog collection to 
digital format to ensure that its patrons will have a large and diverse 
collection of DTBs by fiscal year 2008. The balance of $500,000 in the 
request is for the first installment of a three-year conversion of 
10,000 audio titles from analog to digital format. Support for the 
fiscal year 2005 budget will help prepare the way for the new delivery 
system to replace the current analog cassette tape technology.

                          MASS DEACIDIFICATION

    A total increase of $948,000 is requested for the fifth increment 
of the Library's five-year, $18 million initiative to save through 
deacidification one million endangered acidic books and five million 
manuscript sheets during the period 2001-2005. The Congress has 
approved the first four increments of this critical preservation 
program, and the Library requests the planned increase to continue to 
scale up to $5.7 million annually. By 2005, the Library plans to have 
reached the capacity to deacidify 300,000 books and 1,000,000 
manuscripts annually.

                        VETERANS HISTORY PROJECT

    Additional funding of $1.035 million and four FTEs is required for 
this important and growing project. Support is requested to increase 
public participation in interviewing veterans and creating the 
collection; to preserve accounts and documents for researchers, 
educators, and future generations; and to disseminate this compelling 
material to the public more widely. The overwhelmingly positive 
nationwide reaction to this program has exceeded our expectations, and 
will require additional resources to respond to the growing demands of 
this mandated program.

                                SECURITY

    The Library is requesting an increase of $7.306 million and 47 FTEs 
to support improved security of the Library's systems, staff, 
buildings, and collections. The Library continues to work with the 
Architect of the Capitol (AOC) to support major perimeter security 
improvements, consistent with the entire Capitol Hill campus (e.g., 
garage barriers, bollards, entrance reconfigurations). Seventy-five 
percent of Phase I (Jefferson and Madison Buildings) perimeter security 
project construction has been completed. However, unforeseen structural 
conditions below the James Madison Building have resulted in a partial 
redesign and additional AOC costs to complete the Phase I work. The 
Library understands that the AOC is working with the Committee to fund 
the additional costs and complete the initial phase. We ask the 
Committee to support the funds required to bring our perimeter security 
fully up to Capitol Hill standards.
    The Library is also working with the Capitol Police regarding the 
filling of 23 new police officer positions authorized by the Committee 
for the Library's campus. Capitol Police officers will be detailed to 
the Library to fill the new positions beginning in March 2004.
    Components of the Library's fiscal year 2005 security budget 
request are:
    Police Staffing.--The Library is requesting $3.825 million and 45 
FTEs for the continuation of the fiscal year 2004 hiring initiative, 
which identified a police staffing shortfall of approximately 100 FTEs. 
This is the second of three fiscal year requests for funding beginning 
in fiscal year 2004. For fiscal year 2005 funding and staffing are 
being requested in the Library of Congress's budget to ensure that this 
critical need is set forth to the Congress. The staffing requirements 
will not diminish if and when the Library's Police Force merges with 
the Capitol Police Force. The requirements will be the same, regardless 
of which force provides the service. The Library needs additional 
police positions to meet minimum staffing levels at all public building 
entrances; to staff new and enhanced fixed exterior posts; and to 
ensure an overtime rate that does not exceed 10-15 percent above the 
standard 40-hour workweek.
    Police Merger.--On August 6, 2003, the Library responded in a 
letter to U.S. Capitol Police Chief Gainer regarding the U.S. Capitol 
Police Implementation Plan for the Merger of the U.S. Capitol Police 
and the Library of Congress Police. In this response, we relayed our 
concerns about how this proposed plan will impact the Librarian's 
statutory responsibility to protect Library assets.
    The Library remains concerned about the how the merger of the 
Library of Congress Police Force with the U.S. Capitol Police Force 
diminishes the Librarian's authority to exercise his responsibilities. 
The current plan proposed by the Capitol Police does not take into 
account the statutory obligation of the Librarian of Congress to 
oversee the Library's collections and buildings. The Library's police 
force is focused not only on the physical safety of our staff, 
visitors, and buildings, but on the integrity and security of our 
invaluable collections and is the primary arm for the Librarian of 
Congress in discharging this responsibility. At the very least, the 
Library must have a presence on the Capitol Police Board in order to 
argue for the level of resources made available to protect the 
Library's assets. The Capitol Police officers that serve on Library 
property must also be under the technical direction of and accountable 
to the Librarian of Congress. The Library looks forward to working with 
this Committee and the authorizing Committees to ensure that the merger 
is completed in a manner that preserves the mandated authority of the 
Librarian.
    Security Equipment Maintenance.--A total of $930,000 is requested 
for the maintenance and repair costs of five new major electronic 
security systems, which will become fully operational in fiscal year 
2005. Sustaining their operations will be crucial for Library security. 
The requested funding will ensure that these vital security systems, 
installed in accordance with the Library's Security Enhancement Plan, 
are adequately maintained and repaired by accepted best industry 
practices.
    Intrusion-Detection System.--$1 million is requested to build-out 
the electronic access control and primary intrusion detection systems 
requirements identified in the Library's Security Plan's risk framework 
and needed to mitigate safety risks within the Library.
    Alternate Computer Facility (ACF).--An increase of $622,000 is 
needed for CRS to support the annual recurring operating costs of this 
all-important facility. The ACF will provide for IT business continuity 
in the event of a catastrophic failure of the Library's computer 
center. In the event that the Library's primary computer center becomes 
inoperable, the ACF will also provide continued on-line service to the 
Library's remote/local users, preventing disruption of service to the 
Congress and its constituency.
    IT Security Certification and Accreditation.--Security must be 
treated as an integral part of the Library's overall IT infrastructure 
if risks are to be systematically reduced. Accordingly, the Library has 
embarked upon a thorough review of its IT security. Funding of $929,000 
and two FTEs is requested in fiscal year 2005 for ITS to certify and 
accredit existing, mission-critical IT applications, systems, and 
facilities of the Library ($720,000) and to conduct computer security 
audits by the Inspector General Office ($209,000/2 FTEs).

                         INFRASTRUCTURE SUPPORT

    The Library is requesting $6.531 million and nine FTEs to address 
critical support systems, space, and staff initiatives. These Library-
wide initiatives support all organizational entities and are key to 
performing our varied tasks efficiently and to providing our customers 
with efficient and seamless services. Funding supports:
    Information Technology (IT).--IT is a critical tool for achieving 
organizational success in the Library. An additional $3.316 million is 
needed for the Library's IT infrastructure. To keep pace with the rapid 
increase in electronic traffic, ITS server processing power and 
associated storage has increased, and the corresponding funding for 
maintenance must also increase. A total of $1 million is needed to 
cover ITS's actual and projected maintenance costs (we anticipate a 14 
percent increase in hardware maintenance and a 6 percent increase in 
software maintenance in fiscal year 2005). The Library's technology 
needs change as services expand, and they require 24-hour support to 
satisfy the Library's customers, which sharply raises contract costs. 
The requested $1.017 million will allow ITS to support the increasing 
costs of the IT service provider contract, which the current ITS budget 
cannot fund. Without added funding, ITS will have to either curtail 
services or dangerously cut back on equipment purchases or maintenance. 
One-time funding of $1.299 million is also needed to implement a single 
integrated search function for the Library's primary on-line 
information sources (LIS/Thomas, American Memory, LC Web pages, and the 
Integrated Library System bibliographic catalogs). This initiative will 
support searching with the commonly used data standard (XML) that the 
Congress is now applying to the preparation of its publications. As the 
House and Senate develop and implement new authoring systems that 
support XML, the congressional clientele expect the Library to have a 
search engine and related software that can handle XML. CRS will be 
partnering with the ITS Office to identify the requirements, develop 
solutions, and procure, migrate, configure, and optimize the needed new 
search engine tools.
    Facilities Management.--An increase of $1.880 million and nine FTEs 
are requested to modernize the Library's facilities services, 
supporting space management ($1.658 million/8 FTEs) and custodial 
services ($222,000/1 FTE). The Library's Facilities Services Division 
cannot effectively meet current and future Library space support 
requirements, and lacks flexibility to respond to the Library's rapidly 
changing needs. Multiple internal and external audits and studies of 
Facilities Services have identified fundamental problems in facilities 
programs that only division-wide modernization and workforce 
development can improve. The funding request addresses the most urgent 
recommendations identified by the auditors, several outside expert 
consultants, the ISS Director, and the Facilities Services management 
team. Implementation of these recommendations will provide the Library 
with the basic support tools, previously not available to the Library 
but used throughout industry and by other government agencies, to 
increase the efficiency of all space-related projects, and enable 
rotated scheduling of preventive maintenance (reducing costly repairs 
Library-wide). These steps are especially important for the Offices of 
Safety Services, Security and Emergency Preparedness, and for ITS.
    Reduced funding for custodial services in recent years has resulted 
in a general deterioration of building conditions, and an additional 
$196,000 and one FTE (custodial work inspector) is needed to supplement 
the current contract. Since Fort Meade will add 335,000 square feet of 
space between fiscal year 2005-2009, the Library is requesting $26,000 
to fund the needed custodial services.
    Personnel Management.--A total of $1.335 million is requested to 
upgrade the Library's personnel hiring system. The future of all of the 
Library's efforts depends on our greatest asset the expertise, 
intellect, and dedication of a Library staff that makes our vast 
collections and services relevant and accessible. Library management 
must be able to train, develop and renew its staff and add fresh talent 
to sustain the Library's leadership role amid the massive technological 
changes in the 21st century. The Library's Human Resources Services 
(HRS) needs a fully integrated and comprehensive Web-based Human 
Resource Information System (HRIS) that interfaces with the Library's 
payroll provider. The added funding of $1.335 million requested for 
fiscal year 2005 will procure and implement staffing and classification 
modules that will be integrated with the emerging HRIS and will improve 
the timeliness and efficiency of the Library's hiring and 
classification processes.

                     LIBRARY BUILDINGS AND GROUNDS

    The Architect of the Capitol (AOC) is responsible for the 
structural and mechanical care and maintenance of the Library's 
buildings and grounds. In coordination with the Library, the AOC has 
requested in its fiscal year 2005 budget an increase of $121.8 million 
for Library-related work and support. The AOC budget includes funding 
for six key projects requested by the Library. The two most crucial 
projects are (1) continuation of the Fort Meade construction program by 
the construction of Book Storage Modules 3 and 4 ($38.5 million) and 
(2) construction of the Copyright Deposit Facility ($59.2 million). 
Both of these capital improvement projects are critical in addressing 
basic storage and preservation deficiencies, as well as serious 
environmental, fire, and employee safety issues. Delay in funding this 
construction will make an already-critical situation worse and will 
increase the future cost of construction. Funding is also requested for 
increased space modifications ($150,000), construction of six secure 
storage rooms/vaults ($860,000), a dishwashing machine for the Madison 
cafeteria ($210,000), and an integration and upgrade study ($400,000) 
of our aging book conveyor system. The Library strongly recommends the 
approval of the AOC's Library Buildings and Grounds budget, which is 
essential for the effective functioning of the Library.

                        LEGISLATIVE INITIATIVES

    The Library has proposed language to extend, by five years, the 
period for securing commitments from partners to join the National 
Digital Information Infrastructure and Preservation Program (NDIIPP), 
to provide the mandated matching funds, and to work out formulae to 
include grants, cooperative agreements, contracts, and other legally 
enforceable pledge agreements entered into before 2010.
    The Library's strategy for meeting the requirements of the 
legislation revolves around making investments that require mutual 
participation and cost-sharing agreements with a wide variety of 
stakeholders. Given the current economic climate, the Library 
anticipates that a substantial volume of non-federal matches will be in 
the form of in-kind, cost sharing contributions to the joint NDIIPP 
projects that will be defined and developed by the Library over time. 
The Library seeks to extend the period of time in which these non-
federal contributions can be solicited and received. The Library's 
ability to support these jointly funded projects will be substantially 
enhanced if the $75 million that is subject to a matching requirement 
can be made available for obligation over the extended time frame in 
which the different schedules of pledge donations are likely to be 
fulfilled.
    The Library is funding the NDIIPP by investing in a first set of 
practical experiments and tests. Following an assessment, we will fund 
a second set of investments as described in the plan that was submitted 
to and approved by the Congress in December 2002. The initial planning 
and fact-finding phase of NDIIPP made it clear that the entire amount 
available to NDIIPP could not be responsibly committed without the 
benefit of the earlier testing and iterative learning, followed by 
reinvestment in a second generation of work. The language we are 
proposing for fiscal year 2005 is required to implement this approach, 
which was needed for the Congressionally approved NDIIPP plan. 
Attaining the $75 million of matching federal funding and achieving the 
desired results in the preservation of digital material requires 
investing the initial $20 million in a series of practical projects 
that will unfold over a five-year period.
    The creation of an attainable national preservation strategy will 
occur incrementally, because of the complexity of the challenge and the 
number and diversity of partners involved. The Library is taking 
actions to begin building the preservation infrastructure by: building 
the technical architecture that can support these multiple 
partnerships; developing a network of partners who will share the 
responsibility in the course of the next five years; and participating 
in joint collaborative research on long-term digital preservation and 
archiving issues.
    A first formal call for network partners was released in August 
2003, and we received final proposals on November 12, 2003. The 
Library, along with the National Endowment for the Humanities, is 
making selections among the proposed applicants to seed the NDIIPP 
network with partners for long-term preservation of digital content. 
The Library anticipates awarding up to $15 million of the available $20 
million available in this initial round of investments.
    The Library is simultaneously funding a test of existing 
architectures to assess how digital content can be shared and inter-
operate among different institutions. This will result in a revised 
technical architecture and a second generation of investments in 
developing the overall technical preservation architecture.
    The Library is partnering with the National Science Foundation 
(NSF) in a digital archiving and long-term preservation research 
program. The goal of the program is to stimulate research that builds 
capacities for long-term management and preservation of digital 
materials. The intent of the program is to support both technical and 
economic, social, and legal research topics related to archiving 
digital materials. The Library signed a memorandum of understanding 
with NSF in February 2004.
    Language is also proposed to prohibit transferring funds from the 
Library of Congress to the State Department (DOS) for the construction 
of embassies. The DOS has proposed establishing a Capital Security 
Cost-Sharing Program that, by fiscal year 2009, would cost the Library 
as much as and possibly more than the entire present cost of our 
overseas offices. Under the proposed new program, the Library would be 
paying DOS, by fiscal year 2009, approximately $7.4 million for 202 
positions located in 12 locations--95 percent of which are located in 
only six locations. This assessment would be equivalent to 90 percent 
of the Library's fiscal year 2004 total present overseas budget of 
$8.231 million. The DOS proposal does not follow government cost-
sharing standards and would unfairly leverage additional costs on the 
Library's overseas acquisitions programs that are essential for our 
continued understanding of the Near East and other foreign areas of 
national concern.
    The budget before this subcommittee reflects important needs for 
the Library--preservation of its collections, expansion of its services 
to the Congress increasingly services for the nation. As the national 
library leading and working with a complex network of partners at the 
beginning of the 21st century, the Library's workforce--now and in the 
future--is an essential element to the success of our mission and 
goals. In previous appearances before this Subcommittee, I have 
stressed the need to transfer knowledge and expertise to a new 
generation of knowledge specialists. An estimated 40 percent of the 
Library's workforce will be eligible to retire by 2009. The Library 
must also be able to attract and retain the very best talent 
available--in CRS, the Law Library, the Copyright Office, in its core 
library management areas.
    Elsewhere in the federal government--widely in the Executive Branch 
and within sister agencies such as GAO--the recruitment, management, 
and pay scales of the federal workforce are being changed. The Library 
will be seeking from the 108th Congress authorization for broad-based 
human capital tools and flexibilities, in line with practices already 
in use within the federal government. We need to ensure that the 
Library of Congress can attract, retain, motivate, and reward a top 
quality and high performing workforce to serve the Congress and to 
sustain and make even more usable the nation's strategic information 
and knowledge reserve. In order to meet the ambitious goals of our 
strategic plan and accomplish our goals, we must be able to compete on 
a level playing field within the federal government for the best 
talent. The Library's services to Congress and the nation are unique 
and multi-faceted, and they require the Library's workforce to possess 
cutting-edge knowledge and skill sets.

                                SUMMARY

    As the keeper of America's--and much of the world's--creative and 
intellectual achievements, the Library of Congress is keenly aware of 
its awesome responsibility. This Library is the research and 
information arm of the national legislature and contains the world's 
largest storehouse of knowledge and the mint record of America's 
creativity. The strategic plan and supporting fiscal year 2005 budget 
request will continue the Library's great tradition, which covers the 
world and has now been expanded to include Congressionally mandated 
leadership in the massive task of sorting and preserving digital 
material. All of this is needed to support the Congress, the public, 
and the democratic ideal.
    The Library's vision for the 21st century is to lead the nation in 
ensuring access to knowledge and information by promoting the Library's 
creative use of its unmatched human and material resources for the 
Congress and its constituents. By 2008, the Library plans, with the 
support of the Congress, to have achieved the following:
  --The Library's National Audiovisual Conservation Center is operating 
        and is recognized as having assumed international leadership in 
        providing film and recorded sound preservation and 
        accessibility. The new storage facilities at Fort Meade are 
        operating and are recognized as an outstanding example of how 
        to perform off-site storage, long-term preservation, and rapid 
        access to the material.
  --The core national programs of Library Services and the Office of 
        Strategic Initiatives are recognized to have sustained the 
        breadth and depth of the universal artifactual and digital 
        collections. These programs will also have provided positive, 
        verifiable assurance that the Library is acquiring, 
        establishing bibliographic control, preserving, providing 24/7 
        access, and securing the collections for future generations 
        regardless of the information's format.
  --The Congressional Research Service has succeeded in restructuring 
        both its permanent workforce and its supplemental interim 
        capacity so that it is always the first-choice research 
        provider of the Congress for authoritative, nonpartisan, 
        timely, and objective research and public policy analysis in 
        support of legislative deliberations. It will have improved 
        both the quality of its analysis as well as its overall 
        research capacity.
  --The National Library Service for the Blind and Physically 
        Handicapped has completed the development of digital talking 
        book technology and has begun conversion to use of the 
        technology through distribution of the new talking book 
        machines.
  --The Copyright Office is a leading advocate of an effective national 
        copyright system that serves both creators and users of 
        copyrighted works; is the primary advisor to the Congress on 
        national and international copyright matters and is a relied-
        upon source of information and assistance to federal agencies 
        and the judiciary on these matters; is providing its services, 
        including registrations, electronically; and is creating 
        registration records compatible with the Library's cataloging 
        system.
  --The Law Library of Congress will have achieved and maintained an 
        enhanced electronic system involving almost all countries 
        important to the U.S. Congress in order to provide it with more 
        comprehensive, authoritative, and timely global legal 
        information.
  --The Library has implemented human capital management initiatives 
        resulting in recruitment, development, and maintenance of a 
        diverse, well-trained, highly skilled, and high-performing 
        workforce to filter, navigate, analyze, and objectively 
        interpret knowledge for the Congress and the nation. Further, 
        the workforce functions in a management-supported environment 
        characterized by open communication, innovative thinking, 
        leadership in managing change, and effective and efficient 
        program and supporting processes rivaling the best commercially 
        available services. Special emphasis will be paid for providing 
        flexible rewards and responsibility for staff with substantive 
        expertise that leads to productivity improvements.
    On behalf of the Library and all of its staff, I thank the Congress 
for its continued support of the Library and its programs. I ask for 
the support of the Library's fiscal year 2005 budget request as the 
next step in moving toward achieving these strategic outcomes.

                                 ______
                                 

               Prepared Statement of Daniel P. Mulhollan

    Mr. Chairman and Members of the Committee: I am pleased to appear 
before you today to discuss the work of the Congressional Research 
Service (CRS) and our fiscal year 2005 request. I want to thank this 
Committee for the confidence it has shown in CRS in the past and the 
support that has enabled CRS to serve the Congress during these 
difficult times of demanding policy deliberations, which have been made 
especially challenging because of our heightened need to provide for 
security at home and abroad, and because of greatly increased fiscal 
constraints.
    As CRS completes its ninth decade of service to the Congress, we 
continue to uphold our sole mission: We work exclusively and directly 
for the Congress, providing research and analysis that is 
authoritative, timely, objective, nonpartisan, confidential, and fully 
responsive to the policy-making needs of the Congress.
    The Congress continually and routinely calls on CRS research 
assistance as it examines policy problems, formulates responses, and 
deliberates on them across the broad range of complex and challenging 
issues on the legislative agenda. Our paramount concern, especially 
given the critical constitutional role of the Congress during a time of 
war, is preserving independent, accessible, and responsive analytic 
capacity in the legislative branch.
    Mr. Chairman, my statement today highlights CRS accomplishments in 
supporting the Congress over the past year. My statement also outlines 
the fiscal challenges CRS will face in the upcoming year and reports on 
the steps we have been taking to contain costs. I am concerned about 
the Service's ability to continue providing the level of support 
Congress has come to rely upon. For the coming year, we seek to 
maintain our research support for the Congress including priorities 
targeted to meet major law-making needs as Congress faces continuing 
and unfolding policy concerns, as well as significant, unanticipated 
crises.

         FISCAL YEAR 2003 HIGHLIGHTS IN CRS LEGISLATIVE SUPPORT

    Throughout fiscal year 2003 Congress called on CRS as it confronted 
numerous, challenging public policy problems in its demanding schedule 
of legislative and oversight activities. Today I will touch upon some 
issues emanating from the war with Iraq and efforts to enhance homeland 
security last year. CRS has and continues to play a significant role in 
keeping the Congress abreast of policy questions, options and their 
implications during rapidly changing situations of vital importance to 
the Nation.
    The War with Iraq.--U.S. involvement in Iraq--the diplomatic 
activities and military preparations leading up to the war, the war 
itself, and the war's aftermath--dominated the congressional foreign 
affairs and defense agenda during the year. CRS specialists responded 
to diplomatic, military, and postwar issues; provided briefings on the 
congressional joint resolution authorizing the President to use force 
against Iraq; and fielded queries on war powers, declarations of war, 
and the preemptive use of force under international law.
    As military action began, CRS assisted with issues such as Iraq's 
relations in the Middle East, U.S. efforts to change the Iraqi regime, 
and the United Nations oil-for-food program. Analysts examined the 
postwar needs of Iraq for humanitarian and reconstruction assistance, 
the role of the international community and the United Nations, Iraq's 
economy and foreign debt, and the likelihood that any U.S. loans to 
future Iraqi governments would be repaid.
    Homeland Security and the Potential for Terrorism.--To assist the 
Congress as it addressed homeland security and terrorism, CRS continued 
its Service-wide, coordinated response that draws upon a wide range of 
expertise. Following passage of the Homeland Security Act, CRS experts 
developed a comprehensive organization chart that identified statutory 
requirements for congressional staff who monitor the establishment of 
the Department of Homeland Security (DHS). As Congress began oversight 
activities pertaining to this new government agency, CRS provided help 
with procedural and jurisdictional questions, briefings on the 
operational and organizational aspects of DHS, and analyses on the 
protection, use, and disclosure of critical infrastructure information 
submitted to DHS. Anticipating the subsequent intense demand for 
information and analyses on new or expanded programs related to 
homeland security, CRS examined such matters as emergency management 
funding programs, federal disaster recovery programs, and federal 
assistance programs aiding state and local government in terrorism 
preparedness.
    Other related domestic policy issues related to the war and 
terrorism arose late in the 107th and continued throughout the 108th 
Congresses. CRS responded to requests regarding bioterrorism and health 
issues, such as the public health system's ability to respond to health 
threats posed by chemical and biological agents; border and 
transportation safety; the continuity of Congress in the event of a 
catastrophic attack; critical infrastructure security including 
communications systems, oil and gas pipelines, electrical power grids, 
and highway systems; immigration concerns such as restructuring the 
issuance of visas; and legal ramifications of anti-terrorist 
enforcement, including the roles and authorities of law enforcement and 
the intelligence community.
    The Service's overall productivity and performance in fiscal year 
2003 are best illustrated by four measures of its workload during the 
year: (1) support for 160 major policy problems at all stages of the 
legislative agenda; (2) maintenance of 900 key products in major policy 
areas, representing a 30-percent increase over the 700 products 
maintained at the close of last fiscal year; (3) immediate 24/7 online 
access to key products and services through the Current Legislative 
Issues (CLI) system on the CRS Web site, with a 10-percent increase in 
congressional use of our electronic services over use last year; and 
(4) custom work for the Congress--thousands of confidential memoranda, 
in-person briefings, and telephone consultations. In fiscal year 2003, 
CRS delivered 875,197 research responses, a number that includes 
analysis and information requests, product requests, in-person requests 
and services at Research Centers, electronic services, and seminars.

                        COST CONTAINMENT EFFORTS

    Over the past several years, in order to sustain the level of 
research support on issues such as those outlined above, CRS has 
conducted numerous management reviews to evaluate current operations, 
maximize value, and implement cost containment measures. As stewards of 
the taxpayers' money, it is our obligation to review continuously how 
we can work most cost-effectively. Our reviews identified opportunities 
for containing operational costs of current services: for example, 
closure of the Longworth Research Center and one copy center, 
elimination of the Info Pack, and reorganization of the Service's 
information professional staff. In addition, the Service formed 
collegial research partnerships with major public policy universities 
to enhance research capacity, created a hiring strategy that does not 
routinely replace staff attrition one-for-one, but rather continually 
adjusts the work force composition to respond to the evolving needs of 
the Congress, and examined outsourcing of selected activities where 
cost efficiencies could be realized. I assure you that CRS has 
exhausted all reasonable means of realigning existing resources to 
maximize its efficiency and effectiveness in supporting the Congress. 
Yet despite these many efforts, our research priorities for the future 
remain in jeopardy without additional funding.

                    FISCAL YEAR 2005 BUDGET REQUEST

    Mr. Chairman, I am requesting a total of $100.9 million for fiscal 
year 2005. This represents a 10.7 percent increase in funding over 
fiscal year 2004. This funding request is critical to the continual 
delivery of high-quality analysis to the Congress. A 2001 congressional 
directive obligates the CRS director to: ``. . . bring to the attention 
of the appropriate House and Senate committees issues which directly 
impact the Congressional Research Service and its ability to serve the 
needs of the Congress. . . .'' [H. Rept. 1033, Cong. Rec. 146, H12228, 
November 30, 2001]. I am fully aware of the fiscal realities that the 
Congress faces and the hard choices that must be made in the coming 
months, and I make a request for this funding because I believe that 
these resources are critical to preserving our ability to provide the 
Congress with the level of expertise and breadth of services it has 
come to rely upon so heavily.
    The remainder of my statement summarizes three critical challenges 
facing the Service this upcoming year preserving the Service's research 
capacity, meeting congressional requirements, and funding 
uncontrollable increases for essential research materials.

                 PRESERVATION OF CRS RESEARCH CAPACITY

    Preserving CRS's research capacity is of the highest priority. Over 
the last several years, with the help of the Congress, the Service has 
been able to abate erosion of its workforce. The Service's capacity--
measured by the number of full-time equivalent positions (FTEs)--has 
decreased from 763 in 1994 to 729 this year. After delays due to the 
implementation of the Library's new merit selection, the Service has 
nearly rebuilt its capacity by hiring much needed analytic staff. To 
preserve this capacity the Service is requesting two actions full 
funding for its mandatory pay and inflationary increases and a one-time 
adjustment to sustain its current ceiling of 729 full time equivalent 
staff.
    CRS needs $4.3 million to cover its mandatory and price-level cost 
increases. Without this adjustment, the Service would have to reduce 
its full-time equivalent (FTE) capacity by 37 staff. In addition, the 
Service's budget request includes a one-time financial adjustment of 
$2.7 million to sustain the CRS current FTE level of 729. Without the 
one-time funding adjustment, CRS would have to staff down further by 
another 25 FTEs.
    Change in the CRS workforce composition is an increasingly 
significant factor affecting personnel costs. The nature of the work--
reflecting the increasingly complex and specialized research and 
information requirements of the Congress--dictates that CRS hire 
individuals with high levels of formal education and specialized 
experience. In the period from fiscal years 1995 to 2003, the grade 
level of the average competitive CRS hire has increased from a GS-7, 
step 9, to a GS-13, step 1.
    When Congress confronts unanticipated major policy events, it turns 
immediately to CRS to draw on the existing stock of knowledge of CRS 
experts and their proven ability to assess situations and options 
reliably and objectively. Congress gained significant, immediate 
support from CRS experts as the world listened to early reports of the 
Columbia Space Shuttle accident, during the electricity blackout last 
August, when Mad Cow disease was found in the United States, when ricin 
was discovered in a Senate office building, and on many other 
occasions.
    Congress routinely turns to CRS as it engages in long-term policy 
endeavors for which precedents or experience is limited. Congress is 
receiving continuing assistance from CRS experts in formulating, 
implementing and overseeing a complex complement of provisions for 
homeland security; in grappling with major revisions in government 
personnel practices; in responding to an array of novel assaults on 
corporate and financial integrity; in responding to world health 
threats from SARS, avian flu, and AIDS; in assessing unique conditions 
in Iraq and Afghanistan relating to security, reconstruction and 
governance; in relating a mix of policy objectives across the use of 
the tax code and providing for a robust economy in a far more 
globalized setting than experienced before.
    Without the full funding of our mandatory costs and the one-time 
adjustment to our salary base, CRS would loose a total of 62 full-time 
equivalent staff--a 9 percent reduction to its workforce. The results 
would be devastating. What could be said with certainty is that, 
overall, CRS would not be able to provide the Congress with 102,300 
productive work hours per year. For example, for the 160 active policy 
areas for which CRS maintain ongoing research coverage, 682 productive 
work hours--more than 21 weeks per year--per major issue--would be 
unavailable to the Congress. While the Service would do its best to 
carry out its mission to serve the Congress as it carries out its 
legislative function, this outcome would, by the very scope of its 
effect, force the Service to reduce seriously or eliminate customized, 
timely, and integrative analyses of some critical policy issues. It 
would be difficult to predict what issues would be the most impacted 
but seasoned, expert staff working on high demand issue areas will 
likely leave and we would not be able to replace them.

                   MEETING CONGRESSIONAL REQUIREMENTS

    Another challenge facing the Service is to support CRS business 
continuity and improved technological infrastructure activities as 
required by the Congress. I am seeking $622,000 for continuing 
operations of the alternative computer facility (ACF) that houses back-
up and emergency computer and other technology capacity for the 
Congress, the Library and CRS. With this facility CRS will be able to 
meet needs of the Congress in emergency situations while maintaining a 
secure and reliable technology environment.
    The Service is also requesting $549,000 to develop the XML 
international standard authorized by the Congress as the data standard 
for the creation and accessibility of all congressional documents 
through the Legislative Information System (LIS). CRS will continue to 
work with the House Committee on House Administration, the Senate 
Committee on Rules and Administration, and the Library's Information 
Technology Services to implement this much-needed capability. Without 
funds to replace the existing search system, the LIS will need 
extensive, costly, and proprietary modifications to be able to receive 
and index the legislative documents you need.

 MEETING UNCONTROLLABLE INFLATIONARY INCREASES FOR ESSENTIAL RESEARCH 
                               MATERIALS

    And the last challenge facing the Service is funding research 
materials. Providing accurate, timely, authoritative, and comprehensive 
research analysis and services to the Congress has become increasingly 
difficult due to the high annual increases in the costs of research 
materials. Thus our budget includes a one-time financial adjustment of 
$1.0 million to meet cumulative increases over recent years in 
subscription and publication prices. Restrictive industry policies 
limit our alternatives for obtaining needed materials, especially 
electronic resources, in a more cost-effective manner. Information 
resources sought with the additional funding include those that provide 
information on port security, prescription drug pricing, and the nature 
and status of corporate financial reporting.
    In closing, Mr. Chairman, I appreciate the opportunity to inform 
the Committee about the state of CRS. During a time of war, Congress, 
the First Branch of Government, must ensure that it maintains its 
independent capacity to analyze the complex challenges that the Nation 
confronts in combating terrorism and sustaining homeland security.
    I trust that you agree that CRS contributes significantly to this 
independent capacity of the Congress. I also trust that you believe we 
are fulfilling our mission in a way that warrants your continued 
support. I am, of course, always available to answer any questions that 
the Committee might have.

                                 ______
                                 
                 Prepared Statement of Marybeth Peters

    Mr. Chairman and Members of the Subcommittee: Thank you for the 
opportunity to present the Copyright Office's fiscal year 2005 budget 
request.
    For fiscal year 2005, the Copyright Office is seeking the 
Committee's approval of two major requests. First, we are requesting 
$3,660,000 in new offsetting collections authority and spending 
authority to construct the new office space required to support our 
reengineered business processes. I am pleased that, with this 
Committee's support, we have been able to keep our Reengineering 
Program moving ahead and are now planning for full implementation in 
fiscal year 2006. Second, as part of the Architect of the Capitol's 
budget, we are requesting $59.2 million to construct a Copyright 
Deposit Facility at Fort Meade. This facility will, for the first time, 
ensure that copyright deposits not selected by the Library are stored 
for certain periods in environmental conditions that allow us to meet 
our legal requirements to retain, and be able to produce copies of, 
these works.
    I will review these two areas in more detail, but first will 
provide an overview of the Office's work.

          REVIEW OF COPYRIGHT OFFICE WORK AND ACCOMPLISHMENTS

    The Copyright Office's mission is to promote creativity by 
sustaining an effective national copyright system. We do this by 
administering the copyright law; providing policy and legal assistance 
to the Congress, the executive branch, and the judiciary; and by 
informing and educating the public about the principles of our nation's 
copyright system. The demands in these areas are growing and becoming 
more complex with the rising use and evolution of digital technology.
    I will briefly highlight some of the Office's current and past 
work, and our plans for fiscal year 2005.
Policy and Legal Work
    We have continued to work closely with Members and committees on 
copyright policy and legal questions during the present Congress. 
During the past year, I testified at hearings on peer-to-peer networks, 
state sovereign immunity and the ``broadcast flag'' issue, and the 
Office's General Counsel testified at a hearing on additional 
protection for databases.
    Last April, the House Subcommittee on Courts, the Internet, and 
Intellectual Property held a hearing on the Copyright Royalty and 
Distribution Reform Act of 2003 (H.R. 1417), a matter which could 
impact the operations and budget of the Office. This bill, which was 
reported to the House on January 30, would replace Copyright 
Arbitration Royalty Panels (CARPs) with three full-time independent 
Copyright Royalty Judges appointed by the Librarian of Congress. CARPs 
are ad hoc panels composed of arbitrators which determine royalty 
rates, distributions, and conditions of payment. Panels have been 
operating under Copyright Office auspices since Congress eliminated the 
Copyright Royalty Tribunal in 1993.
    The current system authorizes the Copyright Office to deduct CARP 
administrative costs from royalty fees collected by the Office. The new 
program would require funding primarily from net appropriations. We 
estimate these new costs could approach $1 million.
    During the remainder of this session, the Office expects to assist 
Congress with legislation on and oversight of a number of copyright 
issues, including the extension of the Satellite Home Viewer Act (which 
expires December 31, 2004) and review and possible revision of section 
115 of the Copyright Act, and in particular, the provisions of section 
115 governing digital transmissions of music.
    Last year, we assisted the Department of Justice in a number of 
important copyright cases, including cases before the Supreme Court. We 
also completed the bulk of our work on the second Section 1201 
rulemaking to determine whether any particular classes of copyrighted 
works should be exempted from the protection afforded by the 
prohibition on circumventing technological protection measures that 
control access to such works. As a result of this rulemaking, four such 
classes of works were exempted, including one proposed by the American 
Federation for the Blind and supported by library organizations aimed 
at making sure that the blind and visually impaired gained meaningful 
access to literary materials.
    The Copyright Office continues to provide ongoing assistance to 
executive branch agencies on international matters, particularly the 
United States Trade Representative (USTR), the Department of Commerce, 
and the Department of State.
    As part of this work, our staff participated in U.S. delegations to 
negotiations of several bilateral and plurilateral Free Trade 
Agreements that have been recently concluded, including with Australia, 
Morocco, and a group of Central American countries, and will continue 
involvement with ongoing negotiation efforts, such as with the Free 
Trade Area of the Americas and Bahrain. We also were active in drafting 
and negotiating the intellectual property provisions of the bilateral 
Free Trade Agreements with Chile and Singapore signed in 2003.
    We have also participated in U.S. delegations to multilateral fora 
such as meetings of the World Intellectual Property Organization's 
Standing Committee on Copyright and Related Rights and ad hoc Committee 
on Enforcement, and the preparatory meetings for the World Summit on 
the Information Society. We completed reviews of draft copyright laws 
for a number of countries and, for USTR, provided assistance to other 
nations in their World Trade Organization accession processes. In the 
past year, we also advised and assisted the Bureau of Customs and 
Border Protection in resolving issues and developing new procedures 
relating to border enforcement.

Registration and Recordation
    In fiscal year 2003, we made it a priority to complete our recovery 
from the fiscal year 2002 mail disruption while also improving the 
timeliness of our registration and recordation services. During fiscal 
year 2003, the Copyright Office received 607,492 claims to copyright 
covering more than a million works. Of these, it registered 534,122 
claims. The Examining Division reduced its registration work on hand by 
half and continued toward a goal of currency in correspondence. Two 
years ago, the Office required an average of approximately 200 days to 
issue a registration certificate. By the beginning of fiscal year 2003, 
we had shortened the average processing time to approximately 130 days. 
In January 2003, the Office began a focused effort, reducing the number 
of claims awaiting processing by nearly a third over the course of the 
last nine months of the fiscal year. At year's end, the average time to 
process a claim was 90 days.
    We also reduced processing times in the Cataloging Division. The 
Division created cataloging records for 543,105 registrations in fiscal 
year 2003. Throughput time from receipt in the division until the 
completion of a public record was reduced from over seven weeks to less 
than five.
    As part of its statutory recordation services, the Copyright Office 
creates records of documents relating to copyrighted works that have 
been recorded in the Office. These documents frequently involve works 
of significant economic value. During fiscal year 2003, the Documents 
Recordation Section recorded 16,103 documents covering approximately 
300,000 titles of works. The majority of documents involve transfers of 
rights from one copyright owner to another. Other recorded documents 
include security interests, contracts between authors and publishers, 
and notices of termination of grants of rights. During the course of 
the year, the Section cut its processing time by more than half.

Licensing Activities
    As part of our responsibilities for the copyright law's statutory 
licenses, we administered six Copyright Arbitration Royalty Panel 
proceedings. Five involved rate adjustments, and one was a distribution 
proceeding. The use of electronic funds transfer (EFT), including the 
Treasury Department's ``Pay.gov'' Internet-based remittance collection 
system, in the payment of royalties increased. The percentage of 
remittances made via EFT was 94.5 percent at the end of fiscal year 
2003. The Licensing Division deducts its full operating costs from the 
royalty fees.

Public Information and Education
    In fiscal year 2003, the Office responded to 371,446 in-person, 
telephone, and e-mail requests for information, a 4 percent increase. 
The Office web site received 16 million hits, a 23 percent increase. We 
were pleased to inaugurate new Spanish-language web pages on our site 
which provide basic information on copyright and instructions on how to 
register a work.
    Finally, we worked throughout the year on a project to develop a 
new official seal and an updated logo for the Office. For more than 25 
years, the Office's seal and logo has been a representation of a pen in 
a circle. The new seal and separate logo became effective on January 1, 
2004.

                    FISCAL YEAR 2005 BUDGET REQUEST

    I will now describe the two principal areas of our fiscal year 2005 
request.

Reengineering Program
    Since my testimony last year, we have made significant progress in 
our Reengineering Program:
  --On August 22, we awarded a contract to SRA International to build a 
        new integrated IT systems infrastructure which will support our 
        new processes and public services. This work began in 
        September; since then we have defined the system architecture, 
        refined our system requirements to match the selected software 
        environment, and completed the preliminary design of staff 
        screens and the system's data model.
  --We completed a facilities project plan, a program report 
        identifying facilities and requirements across the Office, 
        adjacency and blocking diagrams, and began detailed design work 
        for each division.
  --We completed much of the process of reviewing and revising the more 
        than 135 position descriptions for jobs that will be changed, 
        in some way, in our new processes.
    Our challenge over the next two years is to coordinate our 
execution across the three reengineering fronts of information 
technology, facilities, and organization. Since our processes are 
changing so dramatically, our Office structure in each of these areas 
will change dramatically as well to the point that our new processes 
cannot begin without full implementation of each front.
    At the same time we are making this dramatic transition to our new 
processes, we need to make sure that we continue to provide our 
services to the public including registration, recordation, licensing 
activities, and acquisition of copyrighted works for the Library's 
collections. We realize that the most significant impact on our public 
services, in terms of the Office's transition, will be in the area of 
facilities. As such, we need to complete our facilities work as quickly 
as possible. We determined that under the fastest construction 
schedule, this redesign would take at least six months. We then 
concluded that, in order to keep providing our services to the public, 
the best option would be to move off site into rental space during the 
construction period.
    Our plans are to begin construction in October 2005 and complete 
this work in April 2006.
    We are including in our fiscal year 2005 approximately $7.5 million 
in spending in the facilities area, consisting of both relocation and 
construction costs. As I mentioned, this budget submission requests an 
increase of $3,660,000 in offsetting collections authority to allow us 
to use funds in the No-Year Account for these tasks.
    We are working with the staff of the Architect of the Capitol on 
the overall facilities approach, and are very appreciative of their 
understanding of our requirements and willingness to work with us to 
address them. We are on schedule to fully complete the design and 
construction documents this year so that the Architect can request 
fiscal year 2006 funding to perform the structural and safety aspects 
of the construction work.
    In addition to our facilities work, in fiscal year 2005, we will be 
piloting our new processes with the new IT systems, obtaining Library 
approval of our new organization, and completing bargaining with the 
unions.
    While we still have a lot of work ahead of us, I believe the entire 
Copyright Office staff is excited that they are involved in building 
the Copyright Office of the future. The result will be better service 
to our customers, including more of our products being available 
online, and a better work environment for our staff.

Fort Meade Copyright Deposit Facility
    The imperative for the Copyright Deposit Facility at Fort Meade is 
to fulfill the requirement under the Copyright Act for the Office to 
provide for long-term preservation of copyright deposits. The Copyright 
Office is required by statute to retain unpublished copyright deposits 
for the full-term of copyright, which is the life of the author plus 70 
years, and to retain published deposits for the longest period 
considered practicable and desirable by the Register. Retention periods 
of 120 years for unpublished deposits and 20 years for the published 
deposits have been established to fulfill this legal requirement.
    Deposits serve as evidence of what was registered; they reflect the 
nature and extent of the material that has been registered. Copies of 
copyright deposits, certified by the Copyright Office, are used in a 
variety of legal proceedings. The Office retrieves approximately 2,500 
works from its offsite storage each year.
    The present retention requirements took effect in 1978. If we 
continue to hold deposits under the conditions that have been in place 
since then, some works will deteriorate to such an extent that we would 
not be able to either ascertain the full work or make a copy.
    The Office currently stores about 50,000 cubic feet of deposits at 
the Landover Center Annex, a GSA leased facility. In addition, the 
Office stores over 85,000 cubic feet of deposits at a commercial 
records management storage facility in Sterling, Virginia run by Iron 
Mountain.
    The legal deposits consist of a variety of formats and types, which 
include: paper in varying quality and size such as books, architectural 
drawings, sheet music, and computer code printouts; magnetic tape (both 
audio and video); photographs; CD-ROMs, CDs, and LPs; and fabric.
    The current storage space, both at the leased facility and the 
commercial records storage facility, fails to provide the appropriate 
environmental conditions necessary to ensure the longevity of the 
deposit materials. The storage space at the Landover Annex is subject 
to wide temperature variances, high humidity levels and water leaks. 
The commercial records storage facility is also subject to seasonal 
temperature fluctuations and uncontrolled humidity levels.
    Continued storage under present substandard environmental 
conditions will accelerate the aging of the deposit material and reduce 
the useful life span by 75 percent, i.e., deterioration that would 
occur in 100 years occurs in 25 years. These conditions place these 
legal deposits at risk in the long term. This is particularly 
applicable to the video and audio magnetic tapes in storage which are 
especially sensitive to environmental conditions. In addition, the 
current storage space at the Landover Annex and the commercial records 
storage facility does not meet the NARA fire protection requirements 
for storage of long-term records which must be in place by fiscal year 
2009.
    The Fort Meade facility would be a highly secured, environmentally 
controlled, high-density storage building with sufficient space for 
retaining current and future deposits. The facility has been 100 
percent designed and construction documents are complete. It will be in 
full compliance with the NARA regulations for records storage 
facilities, and would bring together all copyright deposits in a single 
location, improving retrieval time and our service to the public.
    The Fort Meade facility will allow for 245,000 cubic feet of 
storage. When the building is ready for occupancy in fiscal year 2007, 
we would immediately occupy about two-thirds of that space. Currently, 
the Copyright Office is adding an average of 3,500 cubic feet of 
deposits of published works and records and 3,500 cubic feet of 
deposits of unpublished works annually. Although it is difficult to 
estimate the volume of copyright deposits that we will receive in the 
future, we project that the facility would provide adequate storage 
space at least through 2020.
    We consulted with the Library's Preservation Directorate to 
determine the climate control requirements to ensure that the useful 
life of the legal deposits would be sufficient to meet the legally 
mandated retention periods. Because published and unpublished deposits 
retention periods are different, the necessary environmental 
requirements are different as well. Published deposits need to be 
stored in a temperature of 68 degrees Fahrenheit (F), and 45 percent 
relative humidity (RH). Unpublished deposits must be stored in a 
climate-controlled area maintained at 50 degrees F and 30 percent RH.
    We have briefed the Committee staff on our current storage problems 
and our need for this facility. The Committee staff has asked us to 
ascertain whether there are acceptable alternative storage options. We 
have contacted NARA and Iron Mountain to determine whether other 
storage options exist. All options need to be evaluated based on our 
requirements in the areas of environmental conditions, security and 
retrieval of deposits. We will report our findings to the Committee 
shortly.

       FISCAL YEAR 2005 OFFSETTING COLLECTIONS AUTHORITY REQUEST

    As I have mentioned, for fiscal year 2005 the Office is requesting 
a one time increase of $3,660,000 in offsetting collections authority, 
to be funded by fee receipts in the No-Year Account, for the facilities 
work related to our Reengineering Program. In addition, the budget 
submission contained inflationary factors for mandatory and price level 
increases that were applied to both the Copyright's appropriated and 
receipt funds. This resulted in an additional $809,594 increase to 
offsetting collections authority for a total increase of $4,469,594.
    In reviewing this approach, and upon further analysis of receipt 
projections, we have determined that inflationary increases cannot be 
met by the requested increase in offsetting collections authority. 
Receipts have generally been level since fiscal year 2001 and there 
does not appear to be any basis to believe they will increase in fiscal 
year 2005. As a result, we are requesting that the fiscal year 2005 
offsetting collections authority be reduced by the inflationary 
adjustment of $809,594, with a corresponding increase in net 
appropriations. We have submitted a formal budget amendment to make 
this change.
    Certain factors support a conservative receipt projection in fiscal 
year 2005. Currently, there is no mail backlog, so all receipts have 
been accounted for. Recent delays in the delivery of mail, however, 
underscore the Office's vulnerability to unforseen events and the need 
for conservatively projecting receipts. The relocation and construction 
phase of the Reengineering Program could disrupt fee processing for a 
few weeks, reducing the receipt level in fiscal year 2005.
    In summary, I ask that the fiscal year 2005 budget request for 
Copyright Basic offsetting collections authority be reduced to 
$26,843,406, and that net appropriations be increased by $809,594 for a 
total of $20,178,594. The use of the no-year funds to partially fund 
the facilities piece of the reengineering implementation will leave 
approximately $620,000 in the account for unanticipated decreases in 
fee receipts.
    I would be most grateful for the Committee's acceptance of this 
budget amendment.

                               CONCLUSION

    Mr. Chairman, this fiscal year we are determined to continue the 
improvements we have made in providing public services and to maintain 
steady progress in our Reengineering Program.
    Our fiscal year 2005 request permits us to move forward on the 
facilities work critical to the final implementation of our 
Reengineering Program. The new Copyright Deposit Facility at Fort Meade 
gives us the assurance that we will be able to meet the copyright law's 
requirement that deposits be retained under proper conditions.
    I thank the Committee for its consideration of this request and for 
its support of the Copyright Office in this challenging time of 
transition and progress.

                     OPEN WORLD LEADERSHIP PROGRAM

    Senator Campbell. Since the chairman of the full committee 
is here, I would like to ask one question first, that I was 
going to get to a little later, but as the chairman of the 
Board for the Open World Program, this is a program that 
Senator Stevens was instrumental in helping move.
    Would you give us a quick update on the program, since we 
authorized that expansion to new countries?
    Dr. Billington. Yes, sir, Mr. Chairman. We will shortly be 
delivering the Open World's 2003 Annual Report to the Congress; 
but just a few highlights.
    In 2003, a total of 1,201 families, in 542 communities in 
46 States, hosted people from this program. We have completed 
pilot programs also in Ukraine, Uzbekistan, and Lithuania, 
launched a new cultural program in Russia, while continuing to 
bring political and civic leaders in Russia. Our alumni now 
total 7,547. There is also a group who came from Belarus.
    This has been extremely useful. I think the addition of 
Russia's cultural leaders, who play an important role in the 
development of the country, has been an important new 
dimension; and it focused on vibrant areas outside of Moscow 
and Petersburg that have not previously had the opportunity to 
come. The first hosting was in North Carolina and Michigan, and 
it has already spurred some collaborative efforts in historic 
preservation and plans for exchanges of exhibitions. So, the 
spin-out, the roll-out, of this is very gratifying.
    The focus on the rule of law continues. We have had 838 
Russian judges and legal professionals hosted by Federal and 
State judges, and that has lead to the establishment of sister 
courts and all kinds of relationships.
    Senator Campbell. Do they come over one time?
    Dr. Billington. Yes, they come--well, there have been 
occasional repetitions but almost all of them are one time, 
yes, from--and that is just terribly important, because they 
have a lot of professional demands.

              GAO REVIEW OF OPEN WORLD LEADERSHIP PROGRAM

    Senator Campbell. There is a GAO review of the program now; 
isn't there? Do you know what their preliminary findings are?
    Dr. Billington. Yes. The GAO review, which has been 
completed, and we have had a chance to comment on it. I do not 
know that it has been published yet, but I have reviewed the 
draft, which should be published, I think, this week.
    They spent a lot of time on this, and I want to give them 
full credit, traveling to Russia and Ukraine to interview State 
Department officials and Open World alumni. The draft report 
found that our delegates were highly favorable about their Open 
World program, and noted that the congressional sponsorship was 
particularly important because it helped the program attract 
emerging leaders who might otherwise not have participated.
    The program also came up with some recommendations for 
long-term strategic and business planning, which we have 
already begun on and will be incorporating into the next 
meeting of the board. So, I think it has been very helpful and 
it has generally reinforced the impressions we have had very 
distinctly. With the average age of 38, these people--large 
numbers of women, something totally new for Russia. It is 
really a different kind of exchange program--and it has been 
valuable to the American hosts, communities, families, and 
community leaders that have given so much in-kind support.
    One of the GAO recommendations is that we try to quantify 
that. It is going to be hard to quantify it because it is real 
people from all 89 regions of Russia----
    Senator Campbell. Those are personal relationships that 
carry on.
    Dr. Billington. Our American hosts are real people from all 
over the States, all 50 States, and the District. So, it has 
been a very rewarding program that has gotten good reviews and 
I think has been very successful.
    We also had a group from Belarus that was very important. 
They met with the Governor of Virginia, with the Helsinki 
Commission.
    Senator Campbell. Yes. I met several from Belarus as 
Chairman of the Helsinki Commission.
    Dr. Billington. Yes, sir.

                   FUNDING PRIORITIES AND CHALLENGES

    Senator Campbell. Dr. Billington, I guess I need to ask you 
what we have asked every agency that has come before the 
committee, and that is: What happens if we do get a freeze in 
the fiscal year 2004 level on your budget, and have you 
prioritized things that you are--I mean from the wants to the 
desperate; and are you prepared, if we have to, to make any 
cuts in your programs?
    Dr. Billington. Well, if we had a freeze, the most 
immediate effect would be to radically reduce staff, since 
personnel costs represent, on average, almost 65 percent of our 
overall budget; and in the case of CRS, it is 89 percent. So 
probably, we would have to consider RIFs, furloughs, and so 
forth.
    Without the requested $20.5 million, for instance, for 
mandatory pay and price staff increases, we would have staff 
reductions that would be about 195 FTEs in the LC,S&E 
appropriation--a 7 percent reduction in capacity, 62 FTEs in 
CRS--a 9 percent reduction in capacity, and 26 FTEs in the 
Copyright Office.
    Senator Campbell. Well, the committee is thinking of 
staffing and hiring.
    The committee understands that years ago you instituted a 
new hiring system; is that correct?
    General Scott. Yes; that is correct.
    Senator Campbell. What is the status of that hiring system? 
I understood in your testimony, I am not sure if that was an 
across-the-board number you mentioned, of 7.7 percent fewer 
staff than 1992, was that----
    Dr. Billington. Yes. We presently have 7.7 percent fewer 
FTEs now than we had in 1992, and we are doing a tremendous 
amount more work, as I think is evident. So, to have further 
reduction beyond that would be quite serious.
    There would be all kinds of implications for many important 
ongoing initiatives, for example Culpeper--not to do our part 
that prepares for the processing and the movement of things 
into the building--when the construction is underway largely 
with private sector costs would upset a whole set of 
relationships there.

                            AGING WORKFORCE

    Senator Stevens. Yield to me right there. I must leave. But 
would you enlighten the chairman about the problem of the aging 
of your staff, and then assess these for really reaching out 
now to train people, to take the place of so many people? I 
think it is unique.
    Also, the one thing I would like to see you consider is, I 
spent some time with the archivists the other evening, and they 
are now going through a digitalization program similar to what 
you have gone through. I wonder if you could find the 
opportunity to confer with them to see if you could assist them 
in the progress of their new program to go digital with all of 
their materials as possible, particularly in terms of the aging 
of the staff? That worries me considerably.
    Dr. Billington. Yes, this is tremendous; 48 percent of 
Library staff by this September will be either eligible for 
regular retirement or eligible for early out retirement, if 
they are given that option. This is very serious, particularly 
at a time when we are, in effect, re-tooling people to get into 
the new electronic age and we are losing a lot of our subject 
expertise that has enabled us to find these important things, 
particularly in trouble spots around the world. But, I invite 
General Scott to comment on this. We hope to bring a package 
forward quite soon, and perhaps General Scott can elaborate on 
this.
    General Scott. Yes, sir.
    Senator Campbell. General Scott.
    General Scott. Thank you.
    Senator Campbell. Go ahead.
    General Scott. Yes, Mr. Chairman. With respect to the 
Library's workforce, it is a highly qualified, aging workforce. 
By the end of September this year, 25 percent of our workforce, 
some 1,033 individuals, will be eligible to retire. We also 
estimate that another 23 percent would be eligible to retire if 
we had an early out this year.
    For each year projected ahead, we would of course continue 
to have more employees eligible to retire. By 2009, or 
thereabout, we could be looking at one-half of our workforce 
that would be eligible to retire.
    Dr. Billington has just referenced that our challenge is to 
retain those who we can, retrain staff to handle the new 
knowledge navigation requirements under the digital period, and 
remain competitive in the hiring process. We will be submitting 
a legislative proposal that would in addition to other 
management tools give Dr. Billington some flexibilities for 
handling the fluctuation with staff retirements that we expect 
to happen within the next 3 to 4 years.
    Senator Campbell. What is the average years of service of 
the people who are retiring?
    General Scott. It ranges from 22 to 24 years.
    Senator Campbell. They stay a long time.
    General Scott. Yes, sir.
    Dr. Billington. This requires succession planning which 
includes both retraining current staff, and hiring new staff. 
To successfully accomplish our planing effort, we are going to 
need a great deal more flexibility. We will have a package to 
present to you, Mr. Chairman, very soon that will build on the 
recognition of this problem, capitalizing on HR initiatives 
that have been approved by Congress for other agencies.
    The demands on this institution, with a very low training 
budget and an extremely high demand for skills dictate that we 
focus even more energy on succession planning; CRS has been in 
the forefront but this is an extremely important institutional 
issue that we gain greater flexibility and competitiveness. 
This is important because what our people are doing.

                    COLLABORATION WITH THE ARCHIVES

    Incidentally, on the question on collaboration with the 
Archives, we would be very happy to do that. We have been 
talking with the Archives in connection with the digital 
preservation plan and with other Federal agencies, as well. So, 
we are happy to share our experience and to work 
collaboratively with other institutions.

                           FLEXIBLE WORKFORCE

    But this is really the development of a flexible, well-
trained workforce that is able to work seamlessly between the 
old traditional materials, of which we have unique copies, 
particularly in these trouble spots in the Third World that no 
other library really has the materials on, and at the same 
time, integrate it with the digital world, which is exploding 
at an exponential rate.
    The demands on our people are going to be colossal. We will 
be coming back to you with proposals for legislation that can 
help us in that regard.

                           CRS STAFF CAPACITY

    Senator Campbell. Along the manpower line, I had a question 
relating to CRS and I did not know if you wanted to try to 
answer it; or Mr. Mulhollan, if he is with you here. Mr. 
Mulhollan, come on up to the table there.
    Could you tell the committee why the CRS needs $2.7 million 
for what is called ``lost purchasing power''? What does that 
mean? Does it mean your average pay level has increased 
significantly, or are you requesting more staff, or what does 
lost purchasing power mean?
    Mr. Mulhollan. Yes, sir, that refers to the budgetary 
resources needed to sustain the current CRS staff. You, the 
Congress, are facing more complex issues--whether it is the war 
on terrorism, homeland security issues, aging of the U.S. 
population, infrastructure problems, or nuclear proliferation--
you require greater expertise on each of these complex issues. 
For many years, CRS and this committee has been supportive of 
what Dr. Billington referred to with regard to succession 
planning. CRS faces the possibility of having half of our staff 
retire by 2006. We have already begun replacing them--in fact, 
last year, we filled 91 vacancies.
    The cumulative financial impact of these two phenomenum has 
been an overall shift in the composition of the CRS workforce. 
In 1995, aside from special recruiting programs, the average 
new hire was a GS-7, step 10. Today, it is a GS-13, step one. 
This increase is indicative of the greater level of expertise 
needed by the Congress. In addition, the vast majority of our 
losses are staff who are covered by CSRS, the older Civil 
Service Retirement System. Where the average costs of employer-
paid benefits are 13\1/2\ percent.
    Nearly all of new employees are covered under the newer 
retirement system, FERS, where the average benefit is 27 
percent. That fact alone doubles the employer-paid benefit--
which is significant in an organization where the average grade 
is a GS-13, step nine.
    Another influence contributing to lost purchasing power is 
the gap on the pay raise. In fiscal year 2004, we requested, 
and you approved, a pay increase of 3.7 percent; however a 4.2 
percent pay raise was enacted--creating a $400,000 deficit in 
our fiscal year 2004 budget. That is four FTEs.
    Finally, the rescission of 0.59 percent, in the CRS budget 
was $540,000--equating to five FTEs. So, that is a loss of nine 
FTEs in fiscal year 2004 alone. We are looking for the 
committee to provide the Service with a one-time adjustment to 
sustain an FTE level of 729.
    Senator Campbell. I wish I had not asked that question.
    I am just kidding. I appreciate that, for the record.
    Mr. Mulhollan. You are welcome.
    Senator Campbell. Thank you, Mr. Chairman.

                        NAVCC--CULPEPER DONATION

    Dr. Billington, the very generous donation that Mr. Packard 
did of $120 million, how does that compare with what we are 
investing in that National Audiovisual Conservation Center?
    Dr. Billington. Well, the original arrangement was that 
over a period of time, the Congress would provide $16.5 million 
and the Packard Humanities Institute would match it with some 
$50 million. That adds up to about $66 million. The Congress 
has appropriated its part for that original investment but the 
costs overall have doubled to $120 million--or, actually, more 
than that, but the Packard Humanities Institute has agreed to--
very generously agreed to--absorb all the additional 
construction costs.
    So, all we are asking for, in the current budget, is for 
added staff who can work on the processing and sorting of these 
materials, which is widely scattered. A lot of that is 
permanent value for--as well as to begin the move; because the 
train is moving very fast, thanks largely to their added 
investment in this. And we will be, by next summer, ready to 
move into the re-done vaults for storage; and the following 
year, a whole new building will come on stream. So, this is 
moving very rapidly and all the added construction costs have 
been absorbed by the Packard Humanities Institute.
    What our part of the bargain is, it was attached to the 
agreement, the tripartite agreement among us, the Packard 
Humanities Institute; and the Architect of the Capitol, of 
course, is making sure that all of this conforms to all of the 
relevant standards and so forth.
    We are asking for some FTEs and some added funding that 
will enable us to fully process this material and prepare for 
the move. A lot of that is one-time cost, which will not stay 
in the base; but it is essential that it be done now so that 
the schedule of moving these things in can be done immediately 
and will not hold up construction.
    Let me see, a total of $16.5 million was appropriated for 
the acquisition.
    Senator Campbell. $16.5 million?
    Dr. Billington. Yes, but we will need additional funding 
for the annual carrying costs, which must be covered. A lot of 
the requests that are included for this year will be one-time 
costs that will not be repeated but are essential to come on 
stream at this point, so that the whole process can go forward.
    So, those are the basic outlines, Mr. Chairman. I can give 
you a full, detailed accounting and projection, if you would 
like, on this, for the record.
    [The information follows:]

    From fiscal year 2000 to fiscal year 2003, the Congress 
appropriated $16.5 million to the Architect for the acquisition 
of the facility. In fiscal year 2004, the Congress appropriated 
$14.8 million to the Library for the National Audio-Visual 
Conservation Center to support one-time equipment and other 
implementation costs. In fiscal year 2005, the Library is 
requesting an increase of $5.3 million for a total project cost 
of $20.1 million. Total Library funds through fiscal year 2008 
are projected to be approximately $77 million of which $9.8 
million reflect ongoing program costs for fiscal year 2009 and 
beyond.

             LIBRARY BUILDINGS AND GROUNDS--BUDGET REQUEST

    Senator Campbell. Your budget request includes $161 million 
for buildings and grounds, which is a 312 percent increase over 
the prior year appropriation for that activity. There are two 
projects which account for the majority of that money; $39 
million for the two new book storage modules at Fort Meade, and 
$59 million for the new copyright storage facility.
    Can you just briefly describe those two facilities? Are 
there any alternatives to those buildings?
    Dr. Billington. Well, just briefly. The one--the copyright 
deposit facility is already essential for the reasons that I 
have indicated. They are examining some variant options but it 
does not appear that any will be cheaper than the presently 
projected one.
    The other is dealing with basic storage for special format 
collections. For copyright deposit, the obligation to store 
unpublished works has been extended for 20 years, because of 
the extension of the copyright term. So, we have a much bigger 
pile-up even than we had before; the same is true of our 
special collections.

                              LEASED SPACE

    Senator Campbell. The storage now of all that material, is 
it mostly in leased space or in Government buildings scattered 
around?
    Dr. Billington. It is in leased space, namely at Landover. 
I think I will let General Scott, who has been working most 
closely on these issues, elaborate, if he would.
    Senator Campbell. Okay.
    General Scott. Thank you, sir. With respect to modules 
three and four, Mr. Chairman, those modules are for special 
collections. With special collections, we are talking about 
maps, and we are talking about microfilm, we are talking about 
prints and photographs.
    Currently, those items are being stored in leased 
facilities, the largest of which is in Landover. Now, modules 
three and four--first, let me just make a statement that all of 
the construction for the modules is about 5 years behind, which 
sort of exacerbates the problem of deterioration, and making 
sure that we can preserve those items.
    Now, we also are concerned that in a delay, particularly 
with the copyright deposit facility, any delay increases the 
risk of further deterioration. There is----
    Senator Campbell. Are those leased spaces climate 
controlled?
    General Scott. Yes. Some of it is not climate controlled, 
others have minimal climate control.
    Senator Campbell. What is the cumulative cost of all that 
leased space to the Library of Congress, do you know off hand?
    General Scott. I do not have the cumulative total, Mr. 
Chairman, but I will provide that for the record.
    Senator Campbell. I would like to know that, if you could 
get that to us.
    General Scott. Yes, sir.
    Senator Campbell. It would help----
    General Scott. Will do.
    Senator Campbell [continuing]. When we talk about that big 
increase for facility construction, if we would know the 
comparative costs of what it is costing us now. I think the 
committee would be interested in that.
    [The information follows:]

    Lease space for storage collections is costing the Library 
approximately $1.293 million in fiscal year 2004 and $1.390 
million in fiscal year 2005.

                       COPYRIGHT DEPOSIT FACILITY

    General Scott. Yes, sir. I will add that with the copyright 
deposit facility, that the Copyright Office is currently 
looking at three alternatives. The first is in Lenexa, Kansas, 
where the National Archives has leased some storage space.
    Senator Campbell. Kansas?
    General Scott. Yes, sir. Lenexa, Kansas. There is a cave 
out there that meets some of the requirements for preservation 
controls, and that sort of thing.
    Senator Campbell. What is in that cave now?
    General Scott. Some National Archives material. We are 
looking at it to come up with some cost comparisons. We are 
also looking at the alternative computing facility, which is 
new out at Manassas, Virginia. And the third site is a 
limestone cave at Iron Mountain. We expect to have our report 
completed within 2 or 3 weeks, and we will certainly make sure 
that the Committee has access to all of that information.
    Senator Campbell. Okay. I appreciate that.
    Dr. Billington. There are two considerations, Mr. Chairman, 
on this; one is effective preservation and the other is 
accessibility. One of the great things about Fort Meade module 
one, which is more than two-thirds filled now, is that every 
single request to retrieve has been answered successfully. They 
found it and brought it to the main reading rooms, where the 
stuff can be used fairly rapidly.
    So, you may get excellent preservation at one of these 
distant locations but you will not get the access. We have to 
have continued access because you never can tell what is going 
to be important, German archaeological records----

                    PRESERVATION OF THE COLLECTIONS

    Senator Campbell. Let me ask you, in some of this leased 
space that is not climate controlled, have you been able to 
monitor deterioration of any of the things that you have stored 
there or have you lost anything, because of it being stored in 
places that are not controlled?
    Dr. Billington. Well, we--yes. We do monitor our 
preservation department physically restores or does 
preservation treatment of some chemical or just physical sort 
to somewhere between 300,000 and 500,000 physical items every 
year. We have a very active program for deacidification but 
also transposition into more safety-based films and so forth. 
So, part of this whole process of moving into these things is 
to assure that we can get the highest state-of-the-art 
preservation protocols, which Congress has encouraged us to 
make, and for various formats, actually brought into place.
    I mean Culpeper--for instance, an archive of radio and 
television materials was mandated by the Congress in 1976. 
Culpeper will finally enable us to realize that. It will also 
include film and recorded sound of all kinds. So, this 
preservation is of capital importance; it is monitored very 
heavily. We estimated that something like 75,000 or 77,000 
printed volumes a year risk disintegration. So, we have turned 
the pages into----
    Senator Campbell. How many volumes?
    Dr. Billington. So, these are problems that our 
preservation department works on very intensively; and we are 
making great progress thanks to the Congress' support. But 
without these facilities, we cannot be sure that the progress 
is uniform and that the immense 128 million item collections 
are going to be safely preserved for posterity.

                 EMBASSY CONSTRUCTION--BUDGETARY IMPACT

    Senator Campbell. I understand. Thank you. The last 
question, the Library has six overseas field offices for 
acquiring international publications, and you requested a 
provision exempting the Library from a State Department 
proposal to charge all U.S. Government agencies with an 
overseas presence to pay a portion of the Department of State's 
new building program.
    Why do you believe the Library should be exempt from the 
State Department's proposal and what would be the budgetary 
impact if the State Department's proposal is enacted?
    Dr. Billington. Well, the budgetary impact, I can give you 
the exact computations on this, Mr. Chairman. But let me just 
say that this would be really quite catastrophic. The way the 
assessment is computed, in any case, is based on constructing 
150 Embassies--95 percent of the Library's staff is located in 
only six positions--none of which are a part of the proposed 
new construction. While the Library does have three positions 
in two locations where new Embassies are projected to be built, 
we question the $7 million price tag for three positions.
    So if you figure it up, this is an extremely cost-effective 
way, not only for the Library of Congress but for the other 
research universities that use these things. These offices are 
almost all in trouble spots in the so-called developing world, 
which are of extreme importance to the United States. We would 
have to reduce, immediately, the budget for actually gathering 
in these works.
    I can give you some exact statistics. Let me see, the 
proposal would nearly double the cost of our overseas offices 
eventually to about $15 million from the $8.2 million they cost 
today. As I say, it is based on the number of all employees 
overseas, as opposed to the actual use of space and services.
    Overseas offices are critical, as I say, to the gathering 
of the information of this developing world. So, I think we 
just have to block this inequitable charge from the State 
Department and we would appreciate your help--these overseas 
offices have never been more important. Islamabad, Delhi, 
Djakarta, Nairobi, Cairo, these are areas that are extremely 
important to the United States--there are very few secrets in 
the world. So much can be discovered from more effectively 
reading; and, to jeopardize the ability to put their maximum 
effort on acquiring materials, rather than just paying this 
inequitable surcharge, would make a huge difference.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Campbell. Thank you. I appreciate it. I have no 
further questions, Dr. Billington. Thank you for appearing. 
There may be some in writing from other members of the 
committee. Senator Durbin, the ranking member, was tied up 
today and could not get here. He may have some questions that 
he will send to you in writing.
    Thank you both for appearing.
    General Scott. Thank you, sir.
    Dr. Billington. Thank you.
    Senator Campbell. General Scott, thank you for being here.
    [The following questions were not asked at the hearing, but 
were submitted to the Library for response subsequent to the 
hearing:]

            Questions Submitted by Senator Richard J. Durbin

                              RETAIL SALES

    Question. Dr. Billington, as you know I have been a strong advocate 
of retail sales within the Library of Congress. Could you please update 
me on the status of the Library's retail activities initiatives?
    Answer. The Congress appropriated $335,000 per year for 3 years to 
the Library to support its retail initiatives, beginning in fiscal year 
2004.
    Both the Retail Sales Shop and the Photoduplication Service (PDS) 
ended fiscal year 2003 in the black.
    Our online sales revenues have totaled $105,000 in the year since 
the last hearings. This represents an increase on the $73,000 we 
reported this time last year.
    We have introduced a new website that allows visitors for the first 
time to purchase pre-selected images from the Library's collections.
    We concentrated on major activities to implement the Business 
Enterprises strategy developed and presented to Congress last year.
    We focused on (1) improving and expanding existing e-commerce 
operations; and (2) adding key infrastructure fixes to improve the 
financial management and operations of the Sales Shop and PDS.
    We took actions that included: reducing operating costs, installing 
a new accounting application in PDS, and setting new pricing policies.
    We have developed a ``Strategic Plan Fiscal Year 2004-2006'' and an 
``Implementation Plan Fiscal Year 2004'' that provides a planning 
framework, goals, and implementation actions.
    We have established a team dedicated to the development of this 
program in the areas of business, retail, finance, and marketing.

                    CONSTRUCTION IMPACT ON SECURITY

    Question. I understand that the retail store is changing locations 
in the Jefferson Building due to new security initiatives. Will the new 
location be more visible to visitors to the Library of Congress? What 
impact, if any, has the construction related to the new security 
initiatives in the Jefferson Building had on the retail store?
    Answer. The retail store is scheduled to move from its current 
location to one directly across from where it is now. The current move 
date is targeted for between mid-January and the end of February 2005, 
in order to minimize the impact of sales during the store's busy 
holiday season, late October through December. Its new location will be 
equally visible to visitors.
    We do not expect the new security initiatives to have a negative 
impact on the retail shop. In fact, in its new location, it will be 
immediately accessible to visitors as they exit the Jefferson Building, 
which should be an advantage for sales purposes.

                              POLICE FORCE

    Question. Dr. Billington, I notice you are requesting $3.825 
million and 45 FTEs for the Library of Congress' Police force. Given 
that there are relatively concrete plans in place to merge the 
Library's Police force with the Capitol Police, are you coordinating 
your plans with the Capitol Police Board to ensure a proper skills mix 
in the merged police force?
    Answer. The Library did not coordinate its fiscal year 2005 
staffing request with the Capitol Police Board, but the request is 
consistent with the Library's multi-year fiscal year 2004 request that 
was reviewed by the United States Capitol Police (USCP). The Library's 
fiscal year 2005 staffing request, which reflects year two of a three-
year staffing request of 100 Library Police Officers, is consistent 
with the USCP minimum staffing standards.

                             HUMAN CAPITAL

    Question. Dr. Billington, in your statement you indicate that the 
Library will be seeking broad-based human capital tools and 
flexibilities to enhance recruitment and retention activities. What new 
authorities will the Library be requesting? Are you working with the 
authorizing committees?
    Answer. The Library seeks to exercise authorities that Congress has 
granted throughout the federal government, and to do so without seeking 
executive branch approval. For example, consistent with that already 
granted to both the executive and judicial branches, we will request 
authority to offer early outs and buyouts to Library employees. We will 
also be seeking authorities that will ease significant competitive 
disadvantages the Library would otherwise experience in recruitment and 
retention of senior managers, and skilled professionals, who would be 
better compensated or experience better leave, bonuses or training 
opportunities in the executive branch.
    As Dr. Billington testified in his appearance before this 
subcommittee, as well as the Joint Committee on the Library, we will be 
sending our legislative request to the Library's House and Senate 
authorizing committees.

                     OPEN WORLD LEADERSHIP PROGRAM

    Question. I understand that the United States recently hosted the 
first Open World Leadership delegation from Lithuania. How was the 
expansion received in Lithuania? When will other delegations from 
Lithuania be arriving?
    Answer. The expansion of the Open World Program to Lithuania was 
received with great enthusiasm in Lithuania. U.S. Ambassador to 
Lithuania Stephen Mull and his colleagues at the U.S. Embassy were 
extremely supportive of the idea from the start, and planning this 
pilot would not have been possible without their assistance. A number 
of Lithuanian and American organizations nominated strong candidates 
under the theme ``civil society.'' The first delegation traveled to the 
United States in February 2004 to examine topics such as business, 
community development, media, NGO development, and youth initiatives. 
Ambassador Mull spoke at their pre-departure orientation in Vilnius, 
and upon arrival in Washington D.C. the delegation was greeted by 
Ambassador Vygaudas Usackas Lithuanian Ambassador to the United States. 
Initial feedback from this delegation is very positive, the trip gave 
the Lithuanian participants the opportunity to build long-lasting 
professional partnerships and friendships with their American 
counterparts. The Open World Leadership Center plans to host its next 
delegation of Lithuanian leaders in the fall of 2004.
    Question. How is the Open World program working in Russia and other 
former Soviet satellites? Do you believe it is workable in the rest of 
the former eastern bloc and elsewhere?
    Answer. The Open World Program has made a considerable contribution 
to bettering United States-Russian relations as well as to the 
development of civil society and democracy in Russia. Since the 
program's inception in 1999, Open World has brought over 7,500 Russian 
leaders to the United States, allowing them to experience first-hand 
American style democracy and free enterprise. Now, these Russian 
leaders comprise an active Open World alumni network, a network that is 
working together for positive change in Russia.
    In 2003, the Open World Program was expanded to Lithuania, Ukraine, 
and Uzbekistan. In total, 148 participants were hosted in the United 
States from the three countries under the theme ``civil society.'' 
While each program was adapted to meet the specific needs of the 
country, these pilot exchanges prove that the Open World Program model 
is applicable and useful to countries around the world. Open World 
participants returned to their home countries with new contacts and 
fresh ideas and inspiration. In Uzbekistan, for example, Open World 
alumni are putting their Open World experience to work to better their 
communities by writing articles in the local press, establishing Rotary 
clubs, drafting proposals for developing child and maternity health 
care services, and planning new programs for children with 
disabilities.
    The pilot exchanges demonstrate that leaders and activists from a 
variety of countries can benefit greatly from meeting and sharing ideas 
with their American counterparts. In addition, the Open World Program 
has contributed significantly to furthering bilateral relations between 
the United States and other countries.

                 CRS SCIENCE AND TECHNOLOGY CAPACITIES

    Question. Mr. Mulhollan, what distinguishes the work done by the 
Congressional Research Service in providing analysis of science and 
technology issues for the Congress from those which were performed by 
the OTA, and are now conducted by the General Accounting Office, the 
Congressional Budget Office, the National Academy of Sciences, or other 
sources?
    Answer. Each of the entities that you mention performs different 
activities serving different purposes. The sum total of the work being 
conducted by all is complementary in that each organization brings a 
different perspective or different scope of analysis to the same 
problem.
    The Office of Technology Assessment (OTA) conducted technology 
assessments--a recognized and structured methodology that is very 
distinct from legislative and public policy support. These assessments 
addressed the multiple positive and negative impacts of technology on 
society and offered policy options.
    OTA studies were performed at the request of any congressional 
committee Chairman. The Chairman may have requested work on behalf of a 
Ranking Minority Member or on behalf of a majority of committee 
Members. The OTA Board could also request assessments as could the OTA 
Director. In practice, most assessments were requested by the Chairman 
and the Ranking Minority Member of a Committee.
    OTA assessments, which usually took over a year to complete, relied 
heavily upon groups of external experts and involved extensive external 
review, monitored by internal staff. The contracts issued to obtain 
information or to write parts of the reports could cost well over 
$100,000 each--with the total costs of each study reported to range 
from $500,000 to nearly $1 million each.
    OTA's enabling legislation permitted its reports to be made 
available to the public and its work typically was not prepared on a 
confidential basis.
    The General Accounting Office's (GAO) current technology 
assessments are being conducted on a pilot basis, pursuant to law and 
report language originating in Legislative Branch appropriations.
    To date, GAO has worked on three assessments--each of which has 
taken about a year to complete and has cost in the hundreds of 
thousands of dollars.
    While GAO reports normally make recommendations, its assessment 
reports seem to offer policy options, together with a discussion of 
legislative implications.
    The Congressional Budget Office (CBO) provides budgetary analysis 
on a wide range of issues related to science and technology, ranging 
from health policy to high-technology industries.
    The National Academy of Science (NAS) conducts studies which are 
oriented to resolving technical issues or policy issues.
    Most of the NAS science and technology studies are not mandated by 
Congress--even those which are requested by Congress, via statutory or 
report language, are contracted for by federal executive branch 
agencies. Seven such studies were mandated in public laws and completed 
for the 107th Congress.
    The NAS studies usually cost several $100,000 and take between one 
and two years to complete.
    NAS retains control over the scope of these studies. The NAS 
typically convenes panels of scientific and technical experts to write 
reports, which undergo extensive Academy review prior to transmittal to 
the agency requestor.
    NAS reports typically contain recommendations and advice and are 
not done on a confidential basis.
    Extensive use is made of the expertise provided by the NAS and 
their staff, via contracts. The topics of assessments are typically 
suggested by a few interested Members of Congress.
    The Congressional Research Service (CRS) undertakes analyses for 
both committees and Member offices in scientific and technological 
areas to: (1) assess the overall policy context on specific broad-scale 
legislative issues; (2) assess tradeoffs and alternatives; (3) evaluate 
proposals with heavy technical components; (4) help Congress to 
understand technical and scientific background and developments; and 
(5) provide program and institutional memory.
    Because of the diverse and open-ended needs of Committees and 
Members, the Service must work carefully to ensure that the appropriate 
research capacity is available to the Congress when it needs it.
    Some CRS analyses take several months to over a year to complete. 
The agency's specialization, however, is on integrative policy analysis 
that is legislatively oriented, client-focused, confidential, and 
decision-oriented in nature.
    Science and technology support includes personal, confidential 
consultations, briefings, seminars, workshops, a variety of programs 
for Members of Congress and their staff, technical analytical memos, 
and background reports that assess oversight and legislative issues 
relating to technical subjects.
    For instance, CRS staff have written analytical reports on such 
subjects as management and technical issues relating to the National 
Ignition Facility; vaccine policy issues for the 108th Congress; 
technical, trade, and policy issues for space launch vehicles; digital 
television; and bioterrorism policy issues posed by ricin and 
monkeypox, among many others.
    Several projects involving science and technology in the aging area 
are under way including Medicare assessment of molecular technologies 
and interventions for coverage; biomedical issues in diagnosis and 
treatment of Alzheimers disease; chronic illnesses among older people 
and implications for health care programs; coverage of genetic testing 
by private payers; shifting of risk and responsibilities in an aging 
society; bioethical issues at the end of life; and factors driving 
health care costs; among others.
    CRS has also developed more formal, comprehensive, and systematic 
assessments of technical and/or scientific issues
    These assessments often address broad questions requiring 
foresight, analysis, and synthesis.
    Examples of these in-depth studies include: children's 
environmental health; various global climate change studies; invasive 
species issues; ecosystems management; health benefits of air pollution 
control; electricity restructuring; external costs of oil used in 
transportation; chemical and biological agents and pathogens; and 
various studies on acid rain issues.
    Such in-depth studies take several forms: some--including the ones 
on children's environmental health, the health benefits of air 
pollution control, and ecosystems management--have been implemented 
through national symposia. Some in-depth studies have been undertaken 
with internal resources, but because of their scope and the effort 
required, others have been conducted under contract or through 
foundation grants typically in the range of $20,000 to $100,000.
    CRS continues to monitor its science and technology requests and 
workload through close work with committee staff, discussions with 
nationally recognized scientists, and analysis of scientific 
developments. These actions help CRS anticipate issues as well as 
signal future needs for resources and technical capabilities. For 
example, concerns about terrorism in the 1990s led CRS to begin, before 
September 11, 2001, an assessment of chemical and biological agents and 
pathogens--a study that proved useful during the Homeland Security 
debates of 2002 and 2003.

                   CRS ONE-TIME FINANCIAL ADJUSTMENT

    Question. Mr. Mulhollan, can you explain the $2.7 million ``one-
time financial adjustment'' in your budget request?
    Answer. CRS is seeking a one-time budgetary adjustment of $2.7 
million to sustain a total capacity of 729 FTEs. Without the additional 
funding, we estimate that the current budget base will afford the 
Service approximately 704 FTEs in fiscal year 2005 and beyond--25 FTEs 
short of its current ceiling. Any reduction from the current level of 
729 FTEs will result in a diminution in the Service's ability to meet 
the needs of the Congress.
    The basis for the one-time cost adjustment in fiscal year 2005 is 
the confluence of two dynamic influences:
    A change in the work force composition is the most significant 
factor. During the past ten years, the total size of CRS has decreased 
from 763 FTEs to 729 FTEs. Within these shrinking resources, CRS has 
consistently produced ``more with less'' and demonstrated increased 
productivity in responding to congressional needs. Economies that were 
previously realized from technology and contractual assistance are no 
longer possible. Assisting the Congress as it addresses increasingly 
dynamic and complicated issues requires a cadre of highly skilled, 
knowledgeable, and motivated workers--a work force that is increasingly 
more expensive to sustain.
    The second influence is related to the changing proportion of staff 
in the two federal retirement systems. CRS is behind the CSRS-to-FERS 
transition curve when compared to the rest of the federal sector. The 
CRS workforce has historically remained with the Service for the 
duration of their career--and often beyond their retirement-eligibility 
dates. Recent experience confirms that: (1) the majority of CRS 
retirements/separations are CSRS staff, and (2) the majority of CRS 
hires are from the private sector/school--eligible only to participate 
in the FERS. The employer-paid benefit rate for a FERS employee is 
nearly double that of CSRS employee making the same base salary. For 
fiscal year 2003, the benefits rate for a FERS employee was just over 
27 percent of his/her salary versus 13.5 percent benefit rate for a 
CSRS employee making the same basic pay.
    Without the one-time funding adjustment, CRS services to the 
Congress would be reduced by about 206 hours a year in each of over 150 
major policy areas in which the Congress can be expected to be actively 
engaged--between 5 and 6 weeks of lost capacity per major policy area. 
Across the Service as a whole, this reduction would equate to a loss of 
about 365 productive hours per week that would not be available to 
provide critical research and analytical support for the Congress.

                          SUBCOMMITTEE RECESS

    Senator Campbell. This subcommittee is recessed.
    [Whereupon, at 11:39 a.m., Thursday, March 11, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]