[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]




 
                       FULL COMMITTEE HEARING ON
                        IMPROVING THE PAPERWORK
                   REDUCTION ACT FOR SMALL BUSINESSES

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

                      COMMITTEE ON SMALL BUSINESS
                 UNITED STATES HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBRUARY 28, 2008

                               __________

                          Serial Number 110-75

                               __________

         Printed for the use of the Committee on Small Business


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                NYDIA M. VELAZQUEZ, New York, Chairwoman


HEATH SHULER, North Carolina         STEVE CHABOT, Ohio, Ranking Member
CHARLIE GONZALEZ, Texas              ROSCOE BARTLETT, Maryland
RICK LARSEN, Washington              SAM GRAVES, Missouri
RAUL GRIJALVA, Arizona               TODD AKIN, Missouri
MICHAEL MICHAUD, Maine               BILL SHUSTER, Pennsylvania
MELISSA BEAN, Illinois               MARILYN MUSGRAVE, Colorado
HENRY CUELLAR, Texas                 STEVE KING, Iowa
DAN LIPINSKI, Illinois               JEFF FORTENBERRY, Nebraska
GWEN MOORE, Wisconsin                LYNN WESTMORELAND, Georgia
JASON ALTMIRE, Pennsylvania          LOUIE GOHMERT, Texas
BRUCE BRALEY, Iowa                   DAVID DAVIS, Tennessee
YVETTE CLARKE, New York              MARY FALLIN, Oklahoma
BRAD ELLSWORTH, Indiana              VERN BUCHANAN, Florida
HANK JOHNSON, Georgia
JOE SESTAK, Pennsylvania
BRIAN HIGGINS, New York
MAZIE HIRONO, Hawaii

                  Michael Day, Majority Staff Director

                 Adam Minehardt, Deputy Staff Director

                      Tim Slattery, Chief Counsel

               Kevin Fitzpatrick, Minority Staff Director

                                 ______

                         STANDING SUBCOMMITTEES

                    Subcommittee on Finance and Tax

                   MELISSA BEAN, Illinois, Chairwoman


RAUL GRIJALVA, Arizona               VACANT, Ranking
MICHAEL MICHAUD, Maine               BILL SHUSTER, Pennsylvania
BRAD ELLSWORTH, Indiana              STEVE KING, Iowa
HANK JOHNSON, Georgia                VERN BUCHANAN, Florida
JOE SESTAK, Pennsylvania             JIM JORDAN, Ohio

                                 ______

               Subcommittee on Contracting and Technology

                      BRUCE BRALEY, IOWA, Chairman


HENRY CUELLAR, Texas                 DAVID DAVIS, Tennessee, Ranking
GWEN MOORE, Wisconsin                ROSCOE BARTLETT, Maryland
YVETTE CLARKE, New York              SAM GRAVES, Missouri
JOE SESTAK, Pennsylvania             TODD AKIN, Missouri
                                     MARY FALLIN, Oklahoma

        .........................................................

                                  (ii)

  
?

           Subcommittee on Regulations, Health Care and Trade

                   CHARLES GONZALEZ, Texas, Chairman


RICK LARSEN, Washington              LYNN WESTMORELAND, Georgia, 
DAN LIPINSKI, Illinois               Ranking
MELISSA BEAN, Illinois               BILL SHUSTER, Pennsylvania
GWEN MOORE, Wisconsin                STEVE KING, Iowa
JASON ALTMIRE, Pennsylvania          MARILYN MUSGRAVE, Colorado
JOE SESTAK, Pennsylvania             MARY FALLIN, Oklahoma
                                     VERN BUCHANAN, Florida

                                 ______

            Subcommittee on Urban and Rural Entrepreneurship

                 HEATH SHULER, North Carolina, Chairman


RICK LARSEN, Washington              JEFF FORTENBERRY, Nebraska, 
MICHAEL MICHAUD, Maine               Ranking
GWEN MOORE, Wisconsin                ROSCOE BARTLETT, Maryland
YVETTE CLARKE, New York              MARILYN MUSGRAVE, Colorado
BRAD ELLSWORTH, Indiana              DAVID DAVIS, Tennessee
HANK JOHNSON, Georgia

                                 ______

              Subcommittee on Investigations and Oversight

                 JASON ALTMIRE, PENNSYLVANIA, Chairman


CHARLIE GONZALEZ, Texas              VACANT, Ranking
RAUL GRIJALVA, Arizona               LYNN WESTMORELAND, Georgia

                                 (iii)

  
?

                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page

Velazquez, Hon. Nydia M..........................................     1
Chabot, Hon. Steve...............................................     2

                               WITNESSES


PANEL I:
Dudley, Honorable Susan E., Administrator, Office of Information 
  and Regulatory Affairs, Office of Management and Budget, 
  Washington, DC.................................................     3

PANEL II:
Brady, Dr. Linda, Kingsbrook Jewish Medical Center, Brooklyn, NY, 
  on behalf of the American Hospital Association.................    12
Daly, Jr., Robert P., Kaw Roofing and Sheet Metal, Inc., on 
  behalf of the National Roofing Contractors Association.........    14
Katzen, Honorable Sally, George Mason University Law School, 
  Arlington, VA..................................................    16
Greenblatt, Drew, Marlin Steel Wire Products, LLC, Baltimore, MD, 
  on behalf of the National Association of Manufacturers.........    18
Garbini, Robert, National Ready Mixed Concrete Association, 
  Silver Spring, MD..............................................    20

                                APPENDIX


Prepared Statements:
Velazquez, Hon. Nydia M..........................................    29
Chabot, Hon. Steve...............................................    31
Dudley, Honorable Susan E., Administrator, Office of Information 
  and Regulatory Affairs, Office of Management and Budget, 
  Washington, DC.................................................    33
Brady, Dr. Linda, Kingsbrook Jewish Medical Center, Brooklyn, NY, 
  on behalf of the American Hospital Association.................    43
Daly, Jr., Robert P., Kaw Roofing and Sheet Metal, Inc., on 
  behalf of the National Roofing Contractors Association.........    54
Katzen, Honorable Sally, George Mason University Law School, 
  Arlington, VA..................................................    59
Greenblatt, Drew, Marlin Steel Wire Products, LLC, Baltimore, MD, 
  on behalf of the National Association of Manufacturers.........    65
Garbini, Robert, National Ready Mixed Concrete Association, 
  Silver Spring, MD..............................................    75
Attachment from National Ready Mixed Concrete Association: 
  Driver's Daily Log.............................................    81

Statements for the Record:
Altmire, Hon. Jason..............................................    32
Associated Builders and Contractors, Inc.........................    82

                                  (v)

  


                  FULL COMMITTEE HEARING ON IMPROVING
                    THE PAPERWORK REDUCTION ACT FOR
                            SMALL BUSINESSES

                              ----------                              


                      Thursday, February 28, 2008

                     U.S. House of Representatives,
                               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 10:00 a.m., in Room 
2360 Rayburn House Office Building, Hon. Nydia Velazquez 
[chairwoman of the Committee] presiding.
    Present: Representatives Velazquez, Clarke, Chabot, and 
Graves.

           OPENING STATEMENT OF CHAIRWOMAN VELAZQUEZ

    Chairwoman Velazquez. Good morning. I call this hearing to 
order to address improving the Paperwork Reduction Act for 
small businesses.
    The federal paperwork burden continues to grow for small 
firms. As agencies churn out regulations and notices at a rate 
of nearly 1,500 pages per week, it seems that every day brings 
some new paperwork on small businesses. In their most recent 
annual report, OMB found that the overall burden increased 
nearly 700 million hours from F.Y. 2005 to F.Y. 2006.
    Paperwork is costly for small firms. According to an NFIB 
study, paperwork and recordkeeping costs small businesses 
nearly $50 per hour. Not surprisingly, small businesses cited 
the volume as being the one of the most difficult problems.
    The Paperwork Reduction Act, or PRA, was created in 1980 
with the intent of curtailing the growth of paperwork, but, 
unfortunately, it hasn't done so. One question the Committee 
seeks to address today is whether current law provides OMB with 
the right tools to limit their growth or if changes must be 
made to the PRA to improve its effectiveness.
    At today's hearing, we have present the administrator of 
the office that was created as part of the Paperwork Reduction 
Act, the Office of Information and Regulatory Affairs. 
Administrator Dudley is charged with overseeing and enforcing 
this important law. It is my hope that she can talk frankly 
about the underlying weaknesses of the law and whether she has 
adequate resources to enforce it. While OIRA has a difficult 
task, small businesses deserve to know exactly why their 
paperwork burden continues to grow.
    In today's testimony, we will surely hear about some of the 
successes of OIRA, but we also wish to understand the obstacles 
that are preventing the office from reducing paperwork 
requirements for small businesses. Additionally, it is critical 
to get answers why some agencies continue to violate the law.
    It is our hope to identify what steps are needed to reverse 
the growth in paperwork. Some critics have pointed out the 
reason there is poor compliance with PRA may be due to the fact 
that OMB guidance is inconsistent with the intent of the Act.
    While the statute says that agencies should work to reduce 
paperwork burdens on small businesses, OMB guidance seems to 
incorrectly limit the scope of the law. I am interested in 
hearing the reasons for this inconsistency and whether the 
small business sections of the law are being misinterpreted by 
OIRA.
    Ensuring that agencies are considering the economic impact 
of their regulations and paperwork requirements on small firms 
is critical. It is a primary reason the Committee established 
the Regulatory Flexibility Act: to focus on reducing 
unnecessary paperwork burden created due to federal 
regulations. We have already has passed legislation to 
strengthen RegFlex this Congress, but it is important to 
examine whether that law and the PRA are working in a cohesive 
manner.
    The PRA should not serve to discourage agencies from 
conducting proper regulatory flexibility analyses. All too 
often we see agencies implementing regulations that ignore or 
understate economic impacts on small businesses. In many 
instances, this is because of a lack of communication between 
the agencies and the small business community.
    Under PRA, an agency that wishes to survey more than 10 
small businesses to determine the economic impacts of a rule is 
required to receive OMB approval. Since approval may take 
months, agencies that are eager to move forward with 
regulations may not be properly assessing potential impacts on 
small businesses.
    Enforcement and oversight of PRA is important, but we have 
to open the prospects of strengthening it to achieve real 
change. Today's panels will offer insight on what types of 
reforms may be needed and if the need for further 
accountability is required.
    The reality is the federal paperwork burden continues to 
grow at a troubling rate, and it is harming our nation's 
entrepreneurs. And it is clear that the purpose of the 
Paperwork Reduction Act is not being realized. I look forward 
to working with Ranking Member Chabot to ensure this important 
law is meeting its full potential for small businesses.
    I want to thank all of the witnesses for coming here today, 
and I yield to the ranking member for his opening statement.

                OPENING STATEMENT OF MR. CHABOT

    Mr. Chabot. Thank you, Madam Chairwoman. And thank you for 
holding this hearing on the Paperwork Reduction Act.
    Although this Committee has legislative jurisdiction over 
the Act, it has not undertaken a comprehensive review of the 
Act since it was last reauthorized back in 1995. During the 
1960s and 1970s, Congress enacted dozens of pieces of 
legislation that imposed recordkeeping and reporting 
requirements on the American citizenry, including millions of 
small businesses.
    In response to this mushrooming growth in paperwork, small 
businesses cried out at a White House conference. And Congress 
responded with the passage of the Paperwork Reduction Act back 
in 1980.
    The Act has three primary objectives: one, minimization of 
federal reporting and recordkeeping requirements on individuals 
and business, especially small businesses; reduction in the 
government's cost of collecting and utilizing the information 
obtained from the public; and, three, maximization of the value 
of the information obtained.
    To meet these objectives, the Paperwork Reduction Act 
prohibits the establishment of a recordkeeping or reporting 
requirement unless it is approved by the Office of Management 
and Budget's Office of Information and Regulatory Affairs, or 
OIRA.
    Prior to such approval, the agency requesting information 
from the public must perform an extensive assessment of the 
cost and benefits of the collection of the information. After 
completing that task, the agency then sends a formal request to 
OIRA for approval of the collection of information.
    Prior to OIRA approval, that office must satisfy itself, 
after providing the public with an opportunity to comment, that 
the collection of information satisfies ten specific statutory 
standards, which are designed to ensure that paperwork burdens 
on the public are minimized while still providing the federal 
government with the necessary information.
    Despite the Act and extensive review by the agency and 
OIRA, the number of hours spent by the public in reporting to 
the federal government increased from 7.4 billion hours in 
fiscal year 2000 to 9.2 billion hours in fiscal year 2007.
    Given this, it remains an open question whether the 
Paperwork Reduction Act is meeting the laudable goals of 
minimizing paperwork burdens on the public. I am particularly 
interested in hearing what recommendations the witnesses have 
to modify the Act to achieve its goal of burden reduction 
without sacrificing the government need to obtain critical 
information.
    With that, I yield back.

    Chairwoman Velazquez. It gives me great pleasure to welcome 
the Honorable Susan E. Dudley. She was nominated by the 
President on July 31st, 2006 and appointed on April 4th, 2007 
to serve as Administrator of the Office of Information and 
Regulatory Affairs at the Office of Management and Budget.
    From 1998 through January 2007, Ms. Dudley served at the 
Mercatus Center at George Mason University, where she directed 
the Regulatory Studies Program, 2003 to 2006. She has authored 
more than 25 scholarly publications and regulatory matters, 
ranging from e-rulemaking to electricity, health care, the 
environment, and occupational safety.
    Ms. Dudley, you are welcome.

      OPENING STATEMENT OF THE HONORABLE SUSAN E. DUDLEY, 
 ADMINISTRATOR, OFFICE OF INFORMATION AND REGULATORY AFFAIRS, 
        OFFICE OF MANAGEMENT AND BUDGET, WASHINGTON, DC

    Ms. Dudley. Thank you very much. Thank you, Chairwoman 
Velazquez and Ranking Member Chabot. I am happy to be here to 
testify about improving the Paperwork Reduction Act for small 
businesses.
    I actually have had the pleasure of testifying before this 
Committee before, but this is the first time as OIRA 
Administrator. And I want to assure you that I do share your 
commitment to reducing the regulatory and paperwork burdens 
that America's small businesses confront daily, and I 
appreciate the opportunity to explore new approaches to 
advancing this important goal.
    Small entrepreneurs are the engine of economic growth in 
America. They represent over 99 percent of all employers and 
provide 60 to 80 percent of net new jobs. Yet, they bear 
disproportionate burdens when it comes to paperwork and 
regulatory burdens.
    OIRA, along with SBA's Office of Advocacy and other federal 
agencies, is working both to minimize unnecessary burdens and 
to help America's small businesses comply with regulatory and 
reporting requirements.
    As you both have mentioned, my office has an important role 
in the Paperwork Reduction Act. The PRA that created OIRA back 
in 1980 and the reauthorizations of the Act in 1985 and 1995 as 
well as the Small Business Paperwork Relief Act of 2002 have 
further enhanced OIRA's role in eliminating unnecessary, 
duplicative, and unjustified paperwork burdens, particularly on 
small entities. And these goals remain high priorities for my 
office.
    Through OIRA's day-to-day reviews of agency information 
collection requests, we seek to ensure that agencies reduce the 
paperwork burdens associated with existing collections of 
information and impose the least burden necessary when they 
issue new collections of information.
    Motivated by the PRA and the SBPRA requirements, federal 
agencies have taken a number of steps over the past several 
years to reduce the amount of information they collect from 
small businesses and to ease their compliance burdens. 
Nonetheless, as you both mentioned, we continue to see 
paperwork burdens grow. The government-wide paperwork burden 
increased more than eight percent in fiscal year 2006.
    I strongly support the PRA's goal of reducing government 
reporting burdens while improving the management of agency 
information resources, and I generally believe it is having a 
positive effect. However, there may be things we can do, both 
administratively and legislatively, to improve it further.
    We face two challenges. I will divide it into two 
categories. One involves streamlining the method of collection 
to ease the burden, particularly on small businesses. And the 
other involves reducing the amount of information being 
collected.
    So to address the first challenge, agencies have worked to 
simplify and redesign forms. And they are relying more on 
technology and e-commerce to streamline reporting.
    SBA's business gateway initiative, a result of the SBPRA 
task force recommendations, offers small businesses a single 
access point to federal regulatory and paperwork compliance 
resources. For example, business.gov is an innovative search-
focused Web site where businesses can access up-to-date 
regulatory and paperwork compliance information and save time 
doing so. We have also made some progress on the second 
challenge: reducing the amount of information collected.
    The IRS is responsible for over 75 percent of the federal 
government's total reporting burden. Recently its Office of 
Taxpayer Burden Reduction launched an initiative to reduce 
burden on small business taxpayers who owe $1,000 or less in 
employment tax by allowing them to file those ET returns as 
well as pay taxes due on an annual, rather than a quarterly, 
basis. IRS estimates this change will reduce reporting burdens 
by 30 million hours annually.
    Despite efforts such as these, agency implementation of new 
statutes has continued to increase paperwork burdens. In each 
session of Congress, laws are passed that create new programs 
for federal agencies to implement and quite frequently new 
agency demands for information. This is the biggest challenge 
we face in trying to minimize paperwork burdens, in large part 
because there are real tradeoffs associated with these new 
collections.
    For example, third party disclosure requirements, such as 
nutrition labeling on food, imposes burdens but may be the most 
effective and least intrusive method of protecting consumers. 
Surveys and other information collection may improve the design 
and enforcement of regulations, making them more effective and 
less burdensome in the long run.
    Nevertheless, it would be valuable for legislators as they 
draft new legislation to consider the paperwork implementations 
of alternative proposals, particularly as they affect small 
entities.
    For OIRA's part, we will continue to work with agencies 
such as IRS and EPA, which impose paperwork burdens that are 
particularly demanding for small businesses, to minimize the 
burden and maximize the utility of information collected.
    I look forward to discussing these further with you and 
other ideas that you may have to improve the effectiveness of 
the PRA. Thank you.
    [The prepared statement of Ms. Dudley may be found in the 
Appendix on page 33.]

    Chairwoman Velazquez. Thank you, Ms. Dudley.
    Administrator Dudley, I mentioned in my opening remarks the 
study that was conducted by the General Accounting Office in 
2006 that found that agencies were not adequately complying 
with the small business provisions.
    And in the study, it was determined that most of the 
information collection records failed to explain small 
businesses' impacts or examine less burdensome alternatives for 
small firms. Can you tell us, since that study was released in 
2006, has the situation improved for small businesses?
    Ms. Dudley. I can tell you that this is something that my 
office working with the agencies as they issue new requests and 
as we review because every three years we review existing 
requests for information as well, this is something that we do 
pay attention to. We pay attention to the burden that is 
imposed and the effect it has on small entities.
    That doesn't mean that that's not something that we can do 
better and that we continue to work on doing that better and 
understanding what the real implications are and whether there 
are things within the statutory constraints that we can do 
better.
    Chairwoman Velazquez. What specific steps has OIRA taken to 
ensure agencies are complying with the small business provision 
of the Paperwork Reduction Act?
    Ms. Dudley. One of the things that we are recently 
working--and this is going to get a little into the weeds--the 
system by which agencies submit their data to us, so their 
information collection requests. And we have an element of 
that.
    So it's a data field that they need to enter what are the 
small business impacts. And that is something that I think one 
of the things it will do is still a work in progress, but I 
think within the next few years, it will give us a better sense 
of this total burden, what is the impact on small businesses.
    Chairwoman Velazquez. But can we wait a few years when we 
know the costs that represents for small businesses?
    Ms. Dudley. I am not saying we wait a few years to see for 
us to work. Each information collection we try to focus on the 
small business impacts as well. What I'm saying, in a few 
years, we may have a better sense of, of that eight billion 
hours, how much of that is borne by small businesses?
    So I think it's a twofold maybe answer to your question. 
One is, in our individual reviews, we are focusing on the 
burden. And we are looking at the impact on small businesses. 
And separately in the long run, we hope to be able to get a 
better handle on exactly what is it that small businesses face.
    Chairwoman Velazquez. Okay. One of the goals of the 
Paperwork Reduction Act was to stop unnecessary paperwork 
requirements within the agencies before they were sent to OMB. 
However, this is not happening. The General Accounting Office 
has found the agency's processes for reviewing information 
collection requests are ineffective.
    Agency chief information officers tasked with this 
responsibility are simply not giving them sufficient scrutiny. 
Do you believe that other officials in the agencies should be 
given the responsibility of reviewing information collections, 
rather than CIOs?
    Ms. Dudley. Well, that is a good question. I think there 
are various officials in agencies that we work with when we 
review information collections because often they are part of a 
regulatory program or another program. So there are different 
officials within each agency that are responsible.
    I recently had a meeting with a deputy secretary of an 
agency on an issue involving paperwork. So I don't know whether 
that requires any kind of statutory change because I think it 
is happening. I think there are senior officials, including the 
CIO but maybe not exclusively the CIO.
    Chairwoman Velazquez. Let me ask you, can you tell me if 
the CIOs have the necessary resources to do their job, training 
and expertise to do their job?
    Ms. Dudley. I think it does go back to the fact that it is 
ultimately the head of the agency or department that is 
responsible. And it may not always be the CIO. The CIOs have I 
think taken some good initiatives to streamline reporting of 
information, make it easier to report.
    Chairwoman Velazquez. What is the main focus of the CIOs?
    Ms. Dudley. They have a lot of IT responsibilities.
    Chairwoman Velazquez. But they focus more on keeping the 
system going, working?
    Ms. Dudley. That may be the case in some areas. And I think 
in those areas, I don't think that means the Paperwork 
Reduction Act is not being paid attention to by others. At 
least my experience has been the program office often is the 
ones that take the initiatives to reduce burdens working with 
the CIOs.
    Chairwoman Velazquez. Some people, some critics have 
suggested that to make the Paperwork Reduction Act more 
effective, the volume of information collection requests that 
are being sent to OMB needs to be reduced. This could be done 
by limiting OMB review to significant paperwork collections and 
shifting more of the review responsibility to the agencies.
    OMB already has delegation authority under the Paperwork 
Reduction Act. Would delegating more authority to agencies on 
lower-priority information requests help OIRA focus on more 
significant paperwork issues? If so, how would you envision 
this delegation occurring?
    Ms. Dudley. I have not focused on this enough, although I 
think that is a very interesting question. I would like to look 
at that and perhaps get back to you.
    Chairwoman Velazquez. I think this is a very important 
issue here. And so I would like to get an answer in writing 
within the next week.
    Ms. Dudley. We will do that. Thank you.
    Chairwoman Velazquez. Now I would yield to Mr. Chabot.
    Mr. Chabot. Thank you, Madam Chair.
    What are some of the reasons that small businesses spend 
more time to comply with federal paperwork requirements than, 
say, large businesses would, in your opinion?
    Ms. Dudley. I think some of the requirements are not per-
employee. So if there are some paperwork requirements that a 
firm with several hundred employees could handle and spread 
over a lot of employees, I think often those analyses are on a 
per-employee basis. And so obviously with fewer employees, it's 
more per employee.
    Mr. Chabot. Sure. Okay. Thank you.
    The Paperwork Reduction Act was last reauthorized in 1995, 
as we know. What effect has the utilization of the Internet, 
for example, had on federal reporting and recordkeeping 
requirements that are not reflected in the statutory language 
of the Paperwork Reduction Act?
    Ms. Dudley. I think business.gov. So we have made some 
improvements there. Business.gov I think has. I think it is 
exciting, the opportunities that we have with eGov so that you 
have one place to go for grants, grants.gov, e-filing of income 
tax returns. I think that it has improved. So it hasn't reduced 
the amount of information that is collected, but it has 
streamlined and made it easier.
    Mr. Chabot. Thank you.
    If you know, what has been the feedback from small 
businesses with respect to the SBA's business gateway?
    Ms. Dudley. I don't know.
    Mr. Chabot. Okay. Can you get that information later for 
us?
    Ms. Dudley. Yes, I can.
    Mr. Chabot. Okay. Thank you.
    And, finally, do you think there should be an effort to 
incorporate plain language initiatives to reduce reporting and 
recordkeeping requirements on small business?
    Ms. Dudley. I mean, that makes sense. And what I don't know 
is how far we have already come there and how much. So that is 
something I can also look into.
    Mr. Chabot. Okay. Very good. All right. Thank you very 
much.
    I yield back, Madam Chair.
    Chairwoman Velazquez. Ms. Clarke?
    Ms. Clarke. Thank you very much, Madam Chair and Ranking 
Member Chabot.
    Honorable Dudley, in your written testimony, small 
businesses represent 99 percent of all employers and provide 60 
to 80 percent of net new jobs. You stated that research by the 
SBA suggests that small entities disproportionately shoulder 
regulatory and paperwork burdens. How does your research 
explain some of the criticisms in regards to complying with 
regulatory and reporting requirements?
    Ms. Dudley. The criticisms from small businesses about the 
difficulties?
    Ms. Clarke. Yes.
    Ms. Dudley. This would be the Office of Advocacy's research 
and I think might suggest that the reason for the criticism is 
that they feel they bear a greater burden.
    Ms. Clarke. How has the OIRA been particularly sensitive to 
small businesses?
    Ms. Dudley. In our reviews of paperwork, of information 
collections, we do try to look at the effect of those. First of 
all, we try to make sure that the burden estimates are 
accurately represented. We look at the effect on small entities 
as well as the general population.
    Ms. Clarke. So you would say that the burden estimates are 
accurate?
    Ms. Dudley. That is something that I would say we spend--in 
our reviews of agencies' information collection requests, that 
is the bulk of our effort, to ensure that they are. So we 
scrutinize them carefully to try to make sure that they are as 
accurate as possible.
    Ms. Clarke. And so you would say that they are accurate?
    Ms. Dudley. I think it is not an exact science. So I don't 
think that there are intentional misrepresentations, but, 
unlike the budget, where we really know how much is being 
spent, it's harder to know.
    Ms. Clarke. It kind of defies the reasoning for measurement 
if there is no indication or you don't have some sort of 
measurement tool that would indeed give you the sense of the 
tipping point, right?
    Ms. Dudley. Yes. I would say, actually, that the fact that 
you have given us the Paperwork Reduction Act does give us a 
need to measure. And we have been improving the measurement.
    So I think, even if the measurement is never going to be 
perfect because different people will take different amounts of 
time, I think you really have provided the incentives to get 
that measurement better and better.
    An example would be the IRS last year. Part of the eight 
percent increase that I mentioned in burden, a lot of that came 
from the IRS just reestimating the burden of filing taxes. And 
so we didn't really change the burden, but we have a better 
model for estimating it. And it turns out it is bigger than we 
thought.
    Ms. Clarke. So how do we, then, flag it for change?
    Ms. Dudley. I think it is changing. I think you have. And I 
think you provided agencies a strong incentive. And we are 
working with them to make sure it is accurate.
    Ms. Clarke. And following a short period of modest decline 
from 2002 to 2004, the federal paperwork burden has increased 
at a rapid rate. Do you know why there was such a rapid 
increase?
    Ms. Dudley. There are probably three factors. And one is 
these adjustments to the burdens that I just mentioned. And so 
it is actually not a change in the burden, but we are 
estimating it more accurately. So that is one factor.
    Another is legislative changes. And that was a large change 
in the 2002 to 2005. That was the bulk of it. It was things 
like Medicare part D.
    And then the third tends to be the smaller of the three, is 
discretionary agency actions. And that is where we feel we have 
the most control as we review paperwork collections.
    Ms. Clarke. And so it just seems to me that what we have 
done is put a spotlight on the problem. We have begun to 
essentially get a sense of how broad the problem is.
    But what I am not hearing is where our act basically serves 
as the trigger for reduction and what you are prepared to do to 
help in that process.
    Ms. Dudley. I think your act is actually doing more than 
you may suggest because we don't know what paperwork would look 
like if we weren't tracking it. So if we weren't measuring or 
tracking paperwork at all, who knows what it would look like.
    I mean, so I agree. We all would like to find a way to 
reduce it further.
    Ms. Clarke. Who do you believe has the responsibility at 
the end of the day to making that change, to identifying that 
tipping point and really enforcing a change?
    And, of course, we are all looking at this because we know 
of the cost to the small business. And the more that we kind of 
study the study and draw this process out, the more that these 
businesses are really suffering a huge burden.
    So we don't want to be so academic about this that we are 
not bringing relief to the problem. And having an active place 
which highlights and spotlights that is great. To me it's the 
action that we are able to put in place through each of our 
agencies that says, you know, this is the time that we are 
going to change this.
    Do you have a sense of where we are with regards to that?
    Ms. Dudley. You had asked where the responsibility lies?
    Ms. Clarke. Right.
    Ms. Dudley. I think it does lie with all of us. And I think 
the other thing I think we need to realize was I mentioned in 
my prepared remarks that there are real tradeoffs. So sometimes 
asking for more information may avoid other costs on small 
businesses and is valuable in itself. And so there are real 
tradeoffs. And it is hard to take all of those tradeoffs into 
account.
    So I would say when we pass new legislation, we need to 
understand what will this require? And I think my office and 
the federal agencies, we need to continue to work and say, 
given the constraints that we have, what is the most efficient 
way that we can do this to avoid burdening small businesses?
    Ms. Clarke. Has there been given significant thought to 
integrated information sharing through technology? Oftentimes 
we know that these businesses are filling out paperwork for a 
myriad of regulatory agencies. And it is all the same 
information over and over.
    And they, too, can use the technology to update any 
information that would then be disseminated to the various 
entities that would need that information. Has there been a lot 
of conversation or thought around that sort of integrated 
technological system?
    Ms. Dudley. Yes, conversation and thought and some pilot 
studies. But I think you're right. I think that is an exciting 
opportunity for improvement, the data harmonization.
    So if a lot of different agencies ask for similar but not 
quite the same information using several different forms, how 
can we do that so that there is one place to provide the 
information and then have it shared?
    We are working on that. There is resistance to it. There 
are barriers to it. But I think that we are making some 
progress towards that.
    And I think you are right. I think that is an exciting 
opportunity not to limit the amount of information we have but 
to collect it in a much more streamlined way.
    Ms. Clarke. Thank you very much, Madam Chair. Thank you, 
Honorable Dudley.
    Chairwoman Velazquez. Ms. Dudley, I am concerned that the 
Paperwork Reduction Act is discouraging agencies from properly 
conducting analysis of small business impacts pursuant to 
RegFlex. This is because the law requires OMB approval when an 
agency conducts a survey of small firms regarding the potential 
impacts of regulations. Agencies often try to avoid these types 
of delays in the rulemaking process.
    Do you believe the PRA should be amended to exempt 
information collection requests from OMB clearance if they are 
purely voluntary and requested for the purpose of doing a 
RegFlex analysis?
    Ms. Dudley. That is something that I think is something 
that is worth exploring. And I know it is very different from 
the way the PRA was initially created to include voluntary as 
well as mandatory. So I think that will take a little--I 
certainly can't give you an off-the-top-of-my-head answer.
    Chairwoman Velazquez. What can you tell us today is a 
recommendation from your end where you feel that legislatively 
changes should be made to make the PRA more effective?
    Ms. Dudley. I know that there have been efforts to examine 
that. The administration has not developed a position on how to 
make it and I think, in large part, because it doesn't always 
appear to be, but I think it is working pretty well and so 
whether there are specific changes that we can make to fix the 
things that I think you have all accurately identified.
    Chairwoman Velazquez. Well, I think that if you stay here 
for the second panel--
    Ms. Dudley. There will be recommendations?
    Chairwoman Velazquez. --they will say that it is not 
working for them. And so, Ms. Dudley, do you have any staff 
that will remain for the second panel?
    Ms. Dudley. Yes. Yes, I do.
    Chairwoman Velazquez. Mr. Chabot, do you have any more?
    Mr. Chabot. I don't have any other questions.
    Chairwoman Velazquez. Well, Ms. Dudley, you are excused. 
And, again, thank you for your participation this morning.
    Ms. Dudley. Thank you very much.
    Chairwoman Velazquez. I will ask for the witnesses from the 
second panel to please take your seats. And now we recognize 
Ms. Clarke for the purpose of introducing our first witness on 
the second panel.
    Ms. Clarke. Thank you very much, Madam Chair and Ranking 
Member Chabot.
    It is truly a privilege for me to introduce the 
distinguished panelist, whose work has been of great benefit to 
the people I serve in the 11th congressional district. I am 
very honored today to introduce Dr. Linda Brady.
    She is currently the President and the CEO of Kingsbrook 
Jewish Medical Center, located in Brooklyn, New York. Dr. Brady 
has served in her current role at the medical center since 
1999. A cum laude graduate of Barnard College, Dr. Brady 
received her medical degree from New York University School of 
Medicine and completed her psychiatric residency at the Albert 
Einstein College of Medicine, Bronx Municipal Hospital Center.
    Kingsbrook Jewish Medical Center, located in the East 
Flatbush section of central Brooklyn, was founded in 1925 as a 
chronic care facility to serve the then Jewish community within 
a cultural context. As the community diversified, Kingsbrook 
expanded its services and programs to meet community needs. An 
864-bed medical training institution, Kingsbrook comprises a 
326-bed acute care hospital and a 538-bed adult and pediatric 
skilled nursing long-term care facility.
    Today Dr. Brady is here to testify on behalf of the 
American Hospital Association. The AHA is the national 
organization that represents and serves all types of hospitals, 
health care networks, and their patients and communities. Close 
to 5,000 hospitals, health care systems, networks, and other 
providers of care, and 37,000 individual members come together 
to form the AHA.
    I am proud to have Dr. Brady here representing my district. 
I am grateful for you being here today. And I look forward to 
hearing your testimony.
    Thank you very much, Madam Chair.
    Chairwoman Velazquez. Welcome, Dr. Brady. And you will have 
five minutes to make your presentation.
    Thank you.

  STATEMENT OF MS. LINDA BRADY, PRESIDENT AND CEO, KINGSBROOK 
   JEWISH MEDICAL CENTER, ON BEHALF OF THE AMERICAN HOSPITAL 
                          ASSOCIATION

    Dr. Brady. Good morning, Madam Chairwoman, Ranking Member. 
And hello to Congresswoman Clarke.
    I am Dr. Linda Brady, President and CEO of Kingsbrook 
Jewish Medical Center in Brooklyn, New York. On behalf of the 
American Hospital Association's nearly 5,000 member hospitals, 
health systems, and other health organizations, and its 37,000 
individual members, I appreciate the opportunity to share with 
you the administrative burdens faced by hospitals and what 
should be done to reduce them.
    As a valued and trusted public resource, our society holds 
hospitals in special regard. As a result, we are closely 
monitored and evaluated by local, state, federal, and private 
regulators charged with protecting the public and ensuring that 
public funds are spent wisely and in the public's best 
interest. However, providers are increasingly concerned that 
health care regulation is out of control and has lost a sense 
of fairness and common sense.
    Currently administrative costs comprise between $145 and 
$294 billion of our nation's health care spending and are a 
chief factor in the growth of that spending. It is time for a 
dramatic change.
    Should all regulations be eliminated? No. The issue is not 
whether to regulate but how. Just as providers constantly work 
to ensure that what they do benefits patients first and makes 
prudent use of resources, government must do the same by 
standardizing requirements, being efficient in its demands, and 
eliminating some of the redundant administrative burden placed 
on providers.
    Hospitals operate in an increasingly constrained financial 
environment. As a result, every dollar is precious to 
preserving our mission. Medicare currently reimburses hospitals 
only 91 cents for every dollar of care that they provide to a 
Medicare patient. And Medicaid payments are worse, only 86 
cents for each dollar of services. In 2006 alone, this combined 
underpayment totaled $30 billion. That is on top of an 
additional $31 billion in uncompensated care. Meanwhile more 
and more of hospitals' precious resources are being diverted to 
comply with inefficient, duplicative, and burdensome 
regulations.
    Nearly 30 federal agencies regulate hospitals. And little 
coordination exists among them or between similar agencies at 
the state and local levels. As a result, redundancy abounds.
    For example, CMS conducts six types of activities to 
protect against improper payments, waste, fraud, and abuse. 
Multiple contractors are tasked with carrying out these 
activities to one degree or another.
    While each contractor has an individual purpose, they often 
seek the same information, requiring duplicate effort by 
hospital personnel, who must pull, review, and process patient 
charts and appeals time and time again.
    The Medicare Recovery Audit Contractor Program is 
particularly troublesome because the RACs are paid on a 
contingency fee basis, meaning they keep a percentage of the 
payments they recover, with limited risk for making the wrong 
decisions that unfairly hurt providers. This bounty hunter-like 
payment mechanism has led to excessive chart requests and 
aggressive denials on the part of the RACs.
    Kingsbrook, for example, has seen many cases of wound 
debridement denied for incorrect coding. In 119 cases, the RAC 
claimed that we used the improper code because the word 
``excisional'' was not written on the patient's chart. However, 
the charts contained skin biopsy results clearly demonstrating 
that skin had been removed for testing.
    The RAC was unwilling to accept clinical addenda to the 
medical record, despite the fact that every medical and legal 
expert we consulted said that such documentation was sufficient 
to make a determination.
    As of December 31st, 64 cases, totaling $894,000, have been 
overturned in our favor upon appeal. Fifteen cases are still 
pending. The cost to us in terms of money and man-hours 
expended to overturn these erroneous denials and recoup money 
that was rightfully owed us was great.
    And, yet, we continue to be subjected to denials for the 
same documentation issue because the RAC program lacks a 
feedback loop. This example only hints at the levels of 
confusion and waste caused by duplicative oversight mechanisms.
    In conclusion, we urge the administration and Congress to 
work together to ease the regulatory burden confronting health 
care providers by creating a more common sense approach to 
developing and issuing future regulations. Equally critical is 
the need to provide relief from the most burdensome, 
inefficient, or ineffective regulations, those that take away 
critical time spent with patients.
    My written statement contains specific actions the AHA 
believes will help ease this burden. Hospitals are committed to 
doing the right thing the first time to ensure quality patient 
safety and payment accuracy. However, duplicative regulatory 
and oversight mechanisms only increase confusion and drive up 
costs for both hospitals and the health care system as a whole 
as well as for the government.
    We need smarter, more efficient regulation, rather than 
additional rules and oversight so that the people of America's 
hospitals can spend more time with patients and less time with 
paperwork.
    [The prepared statement of Ms. Brady may be found in the 
Appendix on page 43.]

    Chairwoman Velazquez. Thank you very much, Dr. Brady.
    And now our second witness is Mr. Robert Daly, who is the 
President of the Kaw Roofing and Sheet Metal Inc., established 
in 1923 in Kansas City. And he is testifying on behalf of the 
National Roofing Contractors Association.
    Mr. Daly has served on NRCA's Board of Directors and many 
NRCA committees and in 2007 was elected as president of the 
association. Established in 1886, NRCA is one of the 
construction industry's oldest trade associations and the voice 
of professional roofing contractors worldwide.
    Welcome, sir.

 STATEMENT OF MR. ROBERT P. DALY, JR., PRESIDENT, KAW ROOFING 
   AND SHEET METAL, INC., ON BEHALF OF THE NATIONAL ROOFING 
                    CONTRACTORS ASSOCIATION

    Mr. Daly. Thank you, Madam Chairwoman, Ranking Member 
Chabot, and distinguished members of the Committee.
    My name is Robert Daly. I am President of Kaw Roofing and 
Sheet Metal, a small business in Kansas City, Kansas. I also 
serve as President of the National Roofing Contractors 
Association. NRCA welcomes the opportunity to testify on the 
growing paperwork burden on small business.
    NRCA not only represents over 4,600 contractor members, but 
what we accomplish ultimately affects over 20,000 roofing 
contractors in the United States. Our burden also mirrors that 
probably of every specialty contractor in the U.S. as well.
    Let me state at the outset that small business owners 
recognize the need for sensible regulation in order to protect 
employees, consumers, and the environment. However, it is 
critical that the implementation of regulations and the 
required paperwork be governed by the type of common sense that 
small business people must employ every day if we are to 
survive.
    It is not an exaggeration to say that small businesses are 
drowning in a rising flood of paperwork. My experience bears 
this out, and statistics back it up. Paper files that I must 
keep that used to be one-quarter or a half-inch thick are now 
anywhere from 6 to 12 inches. The paperwork requirements in our 
business are at least 10 times what they were 20 years ago.
    If you are a small business person like myself, forget 
about filing cabinets. Instead, you need to think in terms of 
entire storage rooms to accommodate your paperwork. Paperwork 
requirements in our relations with general contractors, or GCs 
as we call them, demonstrate the challenges we face.
    Just a few years ago, we had to provide general contractors 
with duplicates or at most three copies of government 
paperwork. Today we often have to provide six copies of this 
paperwork.
    There have been instances in which my firm provided three 
copies of certain paperwork to a general contractor, when they 
needed six. Rather than copying the three copies they already 
had, they demanded that we provide those three copies.
    It appears that the further down the food chain you are, 
the more one has to produce while others up the food chain tend 
to manage things. Therefore, not only does the paperwork burden 
fall on us, but also we have to maintain copies for our own 
records.
    The onslaught of government regulatory agencies include 
paperwork requirements that are not entirely cohesive of 
everything such as OSHA to deal with in regards to material 
safety data sheets, and safety policies that must be placed on 
the job in a written form.
    We have DOT daily logs. We have forms regarding the 
disposal of materials in regards to EPA. The Department of 
Homeland Security requires that we fill out forms for 
transportation of certain materials. Prevailing wage jobs 
require that we fill out weekly wage reports. And the list goes 
on and on.
    I understand that these entities' mission is to improve 
worker safety and the security of our country. And we fully 
subscribe to that. But there must be a way to streamline the 
proliferation of paperwork while still achieving that goal.
    The paperwork burden is most acute for small construction 
firms that wish to work on federal projects. In my experience, 
10 to 15 years ago, our firm would often bid federal projects. 
And the paperwork was manageable.
    Now paperwork requirements for federal projects are so 
excessive that a firm has a difficult choice to make. You 
either don't bid on federal contracts or if you are going to 
bid on federal contracts, you must hire additional staff to 
deal with the extra paperwork demands. This drives up overhead 
costs and puts small businesses at a disadvantage to larger 
competitors. Small businesses' decisions not to bid leaves the 
government with less-qualified contractors to choose from.
    Small businesses often do not have the resources capable of 
tracking government regulations. Even diligent small business 
owners may inadvertently make an error or miss deadlines 
associated with government paperwork. It is particularly 
disturbing to be hit with fines or penalties for minor 
inadvertent paperwork violations.
    One of my pet peeves is that people knock on my doors and 
come in and start crying to me about how the river is dirty, 
but nobody suggests how to clean it up. I think one of the 
things we would like to do as a part of this is make some 
recommendations as to what we would like to see done.
    We recommend that Congress provide increased funding for 
the Office of Information and Regulatory Affairs at the Office 
of Management and Budget. OIRA has had some success over the 
years in reducing or streamlining paperwork requirements. 
However, the office has been constrained in recent years by 
declining budgets.
    To address the problem of inadvertent paperwork violations, 
NRCA urges Congress to consider the Small Business Paperwork 
Relief Act of 2007. The bill would direct federal agencies to 
not impose civil fines for certain first-time paperwork 
violations.
    The bill does not exempt businesses from paperwork 
requirements but merely gives an owner acting in good faith 
some leeway to correct a first-time mistake. This is a common 
sense approach to reducing the paperwork burden on small 
businesses while still providing for the safety and health of 
workers in our communities.
    NRCA urges the Committee members to take a serious look at 
this bill as a proposal that could be taken as a first step to 
address the paperwork burden on small businesses. NRCA looks 
forward to working with this Committee to develop effective 
solutions to the paperwork problem facing small businesses.
    Thank you, again, for considering NRCA's views. I would be 
pleased to answer any questions which you may have.
    [The prepared statement of Mr. Daly may be found in the 
Appendix on page 54.]

    Chairwoman Velazquez. Thank you, Mr. Daly.
    Now it is with great pleasure that I welcome the Honorable 
Sally Katzen. Ms. Katzen is a former Administrator at the 
Office of Information and Regulatory Affairs in the Office of 
Management and Budget. She served as Deputy Assistant to the 
President for Economic Policy and Deputy Director of the 
National Economic Council at the White House. She has had 
various leadership roles in the American Bar Association and is 
a visiting professor of law in George Mason University.
    Welcome.

THE HONORABLE SALLY KATZEN, FORMER OIRA ADMINISTRATOR, VISITING 
           PROFESSOR OF LAW, GEORGE MASON UNIVERSITY

    Ms. Katzen. Thank you so much, Chairwoman Velazquez, 
Ranking Member Chabot, Congresswoman Clarke.
    My written testimony will be included in the record, so I 
want to use my time to emphasize a few points. First, each of 
you and all of these witnesses have spoken repeatedly and 
eloquently about the heavy burden of paperwork on small 
businesses. I just want to drop a footnote here that use of 
total burden hours, the nine billion hours, can be misleading 
because that figure includes not only the hours spent incurring 
a liability or monitoring an obligation like a tax form, but 
also hours spent to obtain a benefit, like a small business 
loan or a student loan or veterans' benefits or Social Security 
benefits or Medicare benefits. All of those hours are combined. 
And to speak of the totals repetitively I think masks the very 
important differences.
    Now, it is true that the heaviest burden comes from the 
IRS, and it is customary to beat up on the IRS for its heavy-
duty forms. I would like to point out that the IRS is the most 
aggressive agency in attempting to streamline and simplify 
forms. Administrator Dudley referred to it this morning. The 
GAO cited it as a model, along with EPA, two years ago for an 
effort to try to break through all of this.
    There is also the benefit side of the burden, and, again, 
Administrator Dudley spoke about it. It is in my written 
testimony, and I won't go through that.
    Clearly, all of this aside, paperwork does pose very 
serious burdens on small businesses. And I think you are right, 
it is great that you convened this hearing, and that you asked 
the questions.
    As to the issue you posed to Administrator Dudley, is the 
PRA really working, I was at OIRA for five years during the 
Clinton administration. My own instinct--no empirical data is 
there because there is no counter-factual baseline from which 
to measure--my instinct is it does work. Some of the proof of 
that is in the remarks that you and others have made about the 
fact that agencies are reluctant to send things forward to 
OIRA. They realize that the PRA process imposes time, cost, 
effort, and constraints, and negotiating with OMB is not always 
the most fun thing to do. And, therefore, I think agencies have 
held back.
    Now, can we do better? I think, yes, we can. And I wanted 
to move to the positive side. To do that, we must first 
identify the barriers. We are all in agreement that the single 
largest barrier is the fact that Congress mandates these 
information collections.
    I suspect as we sit here talking about reducing burdens, 
there are hearings in other rooms in this building and across 
the way, where committees are thinking about how they should 
impose new obligations. National security, we have seen a lot 
of that. We see it in a lot of other areas as well. And the 
fact that Congress is making these decisions is something that 
the PRA can't do anything about, regrettably. The PRA does not 
trump another statute.
    The other barrier goes to the issue that Congresswoman 
Clarke was talking about, which is the multiplicity of same 
requests. How do we stop that? Well, I think the government is 
taking some steps with this business gateway to try to get 
information once and use it for several purposes. But a lot of 
times a form will have specialized questions with specialized 
terms or, you might say, idiosyncratic definitions.
    The term ``employee'' might be used by various programs in 
the same agency or in different agencies in different ways. So 
you can't take the answer from one form and incorporate it 
wholesale into another form. Why do those definitions' 
differences exist? It is not because of agency silliness or 
stubbornness. It is because the underlying program creates 
certain terms which the agency has to abide with.
    Now, one of the things that I was very excited about was 
when the task force was set up. The first item on the agenda 
was, come up with ways of consolidating information requests 
across agencies and even within an agency. And I eagerly 
awaited the first report.
    The first report was long on the challenges they face, but 
short on the accomplishments. There were I think five or six in 
appendix 5, several of which had gone back several years. And 
what was particularly disappointing is that there was no road 
map of how to go further.
    Why not call for the agencies to put forth a list of 
instances where, with some technical modifications in the 
definitions or the cutoffs or some of the other qualifications, 
you could, in fact, consolidate a number of requests within an 
agency or across agencies? And then this Committee, working 
with the committees of jurisdiction, can serve this up to the 
Congress and actually accomplish some real difference.
    I have to invoke the committees of jurisdiction. Dr. Brady 
was talking about the source of this, of the regulations, which 
come from HHS or CMS or the different agencies. It's not clear 
that by your saying, ``Reduce paperwork, reduce paperwork, 
reduce paperwork'' is going to produce anything until the 
committees of jurisdiction say, ``Let's get real.''
    Two other quick things, if I may. The suggestion of the 
Chairwoman on the role of the CIO and on whether OIRA should be 
limited to review of significant forms are two items that I 
discussed at some length in my testimony before the House 
Government Reform Committee, it was then called, I think, in 
2006. I would be happy to get you a copy of that testimony, but 
those are ideas that I think do bear looking at. Otherwise I 
would continue pressing on what you have accomplished in 
setting up the agenda in the Small Business Paperwork Relief 
Act.
    I am not saying the PRA works perfectly. To the contrary, 
we need to do more. But there are ways of doing it that are 
smart and productive. And I would encourage you to work in that 
regard.
    Thank you. I will be happy to take any questions.
     Chairwoman Velazquez. Thank you very much.
    Our next witness is Mr. Drew Greenblatt. Mr. Greenblatt is 
testifying on behalf of the National Association of 
Manufacturers. He is the President of the Marlin Steel Wire 
Products, established in 1968 in Baltimore, Maryland. Marlin 
manufactures wire racks, baskets, and hooks.
    The National Association of Manufacturers was founded in 
Cincinnati, Ohio in 1895 and represents 130,000 manufacturers 
in all 50 states.
    Welcome. And you will have five minutes. Thank you.
    [The prepared statement of Ms. Katzen may be found in the 
Appendix on page 59.]


STATEMENT OF MR. DREW GREENBLATT, PRESIDENT, MARLIN STEEL WIRE 
    PRODUCTS LLC, ON BEHALF OF THE NATIONAL ASSOCIATION OF 
                         MANUFACTURERS

    Mr. Greenblatt. Thank you, Chairwoman Velazquez, Ranking 
Member Chabot, and members of the Committee on Small Business. 
Thank you for the opportunity to testify today on behalf of the 
National Association of Manufacturers regarding the Paperwork 
Reduction Act and the work of this Committee to improve it for 
small businesses.
    The National Association of Manufacturers is the nation's 
largest industrial trade association, and it represents small 
and large manufacturers in all 50 states. Three-quarters of 
NAM's membership is small and medium-sized manufacturers. We 
represent the 14 million men and women that actually make 
things.
    My name is Drew Greenblatt. And I am the President and 
Owner of Marlin Steel Wire Products. We make steel wire 
baskets, and we make wire hooks, like this. We make them all in 
Baltimore City, Maryland. We import nothing from China. And we 
make everything in Baltimore.
    Marlin Steel Wire custom-builds wire products for clients 
in the pharmaceutical industry, automotive industry, and 
aerospace manufacturing. We employ 27 people. We have grown 33 
percent in the last 2 years. And we tripled in the last ten 
years. We are adding people. And we want to keep on adding 
people, but we don't want to keep on adding paperwork.
    NAM's mission is to enhance the competitiveness of 
manufacturers by shaping a legislative and regulatory 
environment conducive to U.S. economic growth and to increase 
the understanding among policy-makers, media, and the general 
public about the vital role of manufacturing to America's 
economic future and living standards.
    I compiled all the forms in my business--if you look over 
at this picture right over here--that we generated in a single 
year. We piled them up on top of each other. As you can see, it 
is more than six feet tall. If you look at this photo, you can 
see my plant manager, Simon Matthews; our production 
specialist, Nan Brand, all next to last year's paperwork. This 
is crazy.
    That's why it is no surprise to me that the federal 
government reported that it imposed 9.2 billion hours of 
paperwork on the public in 2007. The cost per employee for 
small firms was almost $22,000 per employee. It's $10,000 per 
employee if you are a medium-sized firm. And it's almost $9,000 
for large firms per employee.
    NAM did a very good report on the structural costs imposed 
on U.S. manufacturers that harm workers and threaten our 
competitiveness. They examined these structural costs that are 
borne by us, and they compared our tax and regulations burdens 
against our competitors in Canada, Mexico, Japan, et cetera. 
And the finding was that our government is imposing 32 percent 
more paperwork on us than our foreign competitors. That is a 
major disadvantage for us.
    We welcome the role that Chairwoman Velazquez and this 
Congress are addressing because it is so important for small 
business. Improving the Paperwork Reduction Act is necessary, 
and it is a noble enterprise.
    The federal government can do much better. No one can say 
with a straight face that we have eliminated as much of the 
unnecessary burden that we can. No one is saying that there is 
no fat left in the system.
    We have to find ways to identify true duplication of our 
information within agencies. But OIRA currently has no way to 
validate an agency's certification of duplication. They just 
take agencies at their word.
    OIRA's staff has shrunk from 90 employees to 50 employees. 
The staff dedicated to writing, administering, and enforcing 
regulations has grown from 146,000 to 242,000 people. OIRA's 
budget has actually shrunk by $7 million in inflation-adjusted 
terms.
    Every hour I spend on paperwork is an hour of lost 
productivity. And lost productivity means I am unable to hire 
the next employee, I am unable to make capital equipment 
purchases, or I can't spend time growing my business.
    Let me give you an idea what I would do with the freed-up 
time. We sell a great deal of products to foreigners. Toyota is 
my second biggest account. Today we are running jobs for 
GlaxoSmithKline in England. We also run jobs for Unilever out 
in Holland. In the last six months, our company has exported 
products to the U.K., Mexico, Belgium, Canada, New Zealand, and 
Japan. My favorite is Taiwan.
    We actually exported. We made it in Baltimore. We exported 
to Taiwan. There is a guy in Taiwan that opened up a box of 
wire baskets, and it said, ``Made in the U.S.A.'' That is neat. 
We are doing a lot of things right.
    We design products with the most sophisticated computer-
aided-design, like this product for Hubert in Congressman 
Chabot's district in Harrison, Ohio. They are a very good 
account of mine, and we appreciate them.
    We make high-quality products that don't get returned, but 
we have to do a lot of paperwork. And this is a distraction to 
our mission. We are afraid that the paperwork we are going to 
fill out, there are going to be typos in it or mistakes. So a 
lot of times we will farm out this paperwork and have to pay 
vendors to fill out paperwork for us because we are not good at 
filling out paperwork.
    Millions of small businesses like mine pay these outside 
fees. Our competition in China doesn't have to pay that fee. In 
India, they don't have to pay that fee.
    In Marlin's case, we have to pay to comply for our 401(k) 
plan, to do our payroll. We have to farm all of that out. We 
pay them so much a year that we can't hire a $15 an hour person 
who is going to work full-time on our production floor.
    We would be more competitive if we could hire that person. 
That person would have a job, a job here in America. Thus 
paperwork actually reduces employment because we are diverting 
cash from hiring people. Instead, we are filling out forms.
    We want our small businesses vibrant since we hire people 
and we take the risks to grow. Government's goal should be take 
off the shackles of the small business hiring machine.
    Again, Madam Chairwoman, thank you for this opportunity to 
testify. And I would be happy to respond to any questions.
    [The prepared statement of Mr. Greenblatt may be found in 
the Appendix on page 65.]

    Chairwoman Velazquez. Thank you, Mr. Greenblatt.
    And our last, but not least, Mr. Robert Garbini. He is the 
President of the National Ready Mixed Concrete Association. Mr. 
Garbini has been active in the association since 1991, serving 
as the executive vice president and chief operating officer. 
The NRMCA was founded in 1930 and represents the ready-mixed 
concrete industry.
    Welcome, sir.

 STATEMENT OF ROBERT GARBINI, P.E., PRESIDENT, NATIONAL READY 
                   MIXED CONCRETE ASSOCIATION

    Mr. Garbini. Good morning, Madam Chairwoman Velazquez, 
Ranking Member Chabot, and Congresswoman Clarke. First off, I 
would like to compliment Mr. Greenblatt on being a fine 
representative of small business in the United States.
    I am Robert Garbini, the President of the National Ready 
Mixed Concrete Association. Thank you for inviting me to 
testify about the Paper Reduction Act and the federal paperwork 
burdens faced by the ready-mixed concrete industry.
    NRMCA is a national trade association representing 
producers of ready-mixed concrete, the vast majority of which 
are small businesses. Nationwide there are roughly 7,000 ready-
mixed concrete plants, employing and using 70,000 ready-mixed 
concrete mixer drivers' trucks that are annually delivering 450 
million cubic yards of ready-mixed concrete to the point of 
placement.
    Ready-mixed concrete producers recognize that as small 
businesses, Congress specifically intended them to benefit from 
the Paper Reduction Act mandates that agency collection of 
information have practical utility, are not duplicative and 
impose the least burden possible.
    I would like to take this opportunity to share with the 
Committee an example of how the Paper Reduction Act could be 
better utilized to unsaddle at least the ready-mixed concrete 
industry and other short-haul operators from a lingering 
paperwork burden.
    Concrete mixer drivers are an on-call and delivery product 
on a just-in-time basis. They operate exclusively in the short-
haul construction industry, generally beginning and ending each 
shift at the same plant location and rarely exceeding a 50 air-
mile radius.
    In fact, the industry's studies show that a concrete mixer 
driver's average delivery is only 14 miles from the ready-mixed 
plant. They actually only drive four to six hours per day. As a 
result, industry truck drivers are eligible for an exemption 
from the Federal Motor Carrier Safety Administration's hour-of-
service requirement that a driver's daily log be kept.
    Currently a 100 air mile radius log exemption is available 
if the driver returns to the plant and is released from work 
within 12 consecutive hours; at least 10 consecutive hours of 
off-duty separate each 12 hours on duty; and, third, the driver 
does not exceed 11 hours maximum driving time. If these 
restrictions are met, instead of the daily log, an electronic 
time clock can be used to record a driver's hours.
    It is notable that the Federal Motor Carrier Safety 
Administration cited paperwork burden reduction as a basis for 
the 100-mile air log exemption when it was first provided in 
1980. Unfortunately, concrete mixer truck drivers are unable to 
take full advantage of the exemption. This is almost always 
caused by a driver surpassing the 12-hour return time limit.
    The hours of service regulations afford a driver, all 
drivers, a maximum of 14 consecutive hours of on-duty time per 
shift, after which drivers may not drive. Yet, ready-mixed 
drivers who otherwise meet the requirements of the 100 air mile 
log exemption must still complete a log if they exceed the 12 
hours on-duty time during the shift. Unlike in the long-haul 
trades, it is very difficult in the ready-mixed concrete 
industry to predict on any given day whether the 12-hour 
threshold will be surpassed.
    If the driver surpasses the threshold but does not expect 
to do so, which is most times the case, he must go back and 
retroactively log his time status for the entire day on a sheet 
similar to this in 15-minute increments, no less. This is 
simply not practical for a concrete mixer driver as their duty 
status changes frequently throughout the day and completing an 
accurate log from memory is difficult.
    To preempt this difficulty, many ready-mixed concrete 
producers have instructed their drivers to log every day every 
15 minutes in case they exceed the 12-hour threshold. The 
Federal Motor Carrier Safety Administration has claimed that 
the threshold is necessary as a safeguard to ensure that 
drivers adhere to driving time limitations. Yet, concrete mixer 
drivers only drive four to six hours per day. Requiring them to 
return to the plant within 12 hours so that they don't exceed 
the 11 hours of driving time is regulatory overkill by itself.
    The Federal Motor Carrier Safety Administration has, with 
one hand, used the Paperwork Reduction Act to provide the 100 
air mile long exemption; yet, with the other hand, has taken 
the exemption away by establishing a seemingly arbitrary 12-
hour return time limit.
    NRMCA urges the agency and the Office of Information 
Regulatory Affairs to take another look at the 100 air mile log 
exemption to see if the Paperwork Reduction Act can be better 
utilized to correct this problem.
    The solution for the ready-mixed industry is a very simple 
one. The 100 air mile exemption should be consistent with the 
hours of service regulations by changing the 12 hours on-duty 
time to 14 hours, which would allow ready-mixed drivers to take 
full advantage of the 100 air mile log exemption for their 
entire shift.
    This seemingly small fix, which can be effected by a 
regulatory change only, would have no safety impacts and would 
provide real relief from paperwork, the paperwork burden that 
has plagued the ready-mixed concrete industry for decades.
    I would also say that a change such as this would impact, I 
think, the third purpose of the Paper Reduction Act, which was 
examining the value of information required.
    Madam Chairman, that concludes my statement. And I would be 
pleased to answer any questions.
    [The prepared statement of Mr. Garbini may be found in the 
Appendix on page 75.]

    Chairwoman Velazquez. Thank you, Mr. Garbini.
    We are going to have a series of votes, three votes, but I 
am going to start asking some questions. And we are going to 
stand in recess and come back right after the votes.
    I would like to cut right to the chase and ask each one of 
you. We heard the Administrator, Administrator Dudley, saying 
that the PRA is working. So do you all agree with the 
Administrator that--and I heard Ms. Katzen. And I would like to 
come back to you with some specific questions regarding this 
matter, but to each one of the witnesses, would you say that 
the PRA is working; that is, reducing the burden that small 
businesses are facing regarding paperwork and reduction?
    Dr. Brady. I can just tell you that the amount of paperwork 
or information that is required and the burden to us has only 
increased. It is very hard for me to say that this is working 
and that there really is a successful effort, not effort but 
outcome, in terms of the ability to reduce duplicative 
reporting and regulation.
    Chairwoman Velazquez. Mr. Daly?
    Mr. Daly. I would have to agree with Dr. Brady. Basically I 
see no evidence of it decreasing. However, it is kind of like 
having a safety program where you don't really know how bad or 
how serious someone is injured. So, relatively speaking, it 
could be worse than what it is now.
    So to say that it's not doing any good I would not think is 
fair, but it needs to be improved. And I think duplication is 
one of the problems.
    Chairwoman Velazquez. Thank you.
    Mr. Greenblatt?
    Mr. Greenblatt. No, I don't think it is helping. And I 
think the government is strangling small businesses. And we 
cannot compete because of all of the paperwork.
    Mr. Garbini. Madam Congresswoman, I would also say that I 
think your own evidence shows that. If the volume of paperwork 
declined, I think then in that case, we would all agree it was 
working but not so.
    Chairwoman Velazquez. Ms. Katzen, can you talk to us about 
your experience during the five years that you were at OIRA? Do 
you feel that the resources that OIRA has today are sufficient 
for them to do their job?
    Ms. Katzen. I think you can always do more with more. And I 
noticed that a number of the witnesses have called for an 
increase of funding and staff for OIRA, I would not disagree 
that additional staff would be helpful.
    I think it is also important to have additional funding for 
the agencies who are being asked to do these tasks in addition 
to what else they have to do. In a day of fiscal discipline and 
in a time when we're trying to straight-line or decrease 
funding for domestic agencies to satisfy our general fiscal 
needs, the agencies have an enormous difficulty in bringing to 
the table the kind of expertise they need.
    Chairwoman Velazquez. Thank you.
    So the Committee stands in recess.
    [Brief recess.]
    Chairwoman Velazquez. I recognize Mr. Chabot.
    Mr. Chabot. Thank you very much, Madam Chair.
    Dr. Brady, I will begin with you, if I can. Of the funds 
spent on administrative costs by hospitals, what percentage 
derives from private insurance carriers and what percentage 
stems from federal, state, or local government paperwork, if 
you know or you can estimate if you don't know exactly?
    Dr. Brady. I don't know exactly. I would say most I would 
suspect is probably government-related, although, you know, 
some of the insurers now, like the Medicaid advantage plans, 
it's sort of a hybrid, if you will. So if there were an 
opportunity, if government could use some standards or the 
government plans or government insurers to abide by, that would 
be a plus.
    Mr. Chabot. Mr. Daly? And I, first of all, have to comment 
that your name, Daly, is my wife's maiden name.
    Mr. Daly. Oh, really?
    Mr. Chabot. So her name was Daly.
    Mr. Daly. Spelled the same way?
    Mr. Chabot. Yes, spelled the same way and everything. And 
when I first got started, Cincinnati City Council was the first 
office I ran for and not too long after we got married. And 
because my name is Chabot, and nobody in my family had ever 
been involved in politics, so people weren't familiar with the 
name. We sort of thought kiddingly about maybe going with her 
last name, running with a political name like Daly, rather than 
Chabot, although we weren't in Chicago.
    Mr. Daly. Right, right.
    Mr. Chabot. And we're not Democrats. But other than that, 
it would have been a great opportunity there. But we appreciate 
your testimony.
    Let me ask, in your firm, who handles the reporting and 
recordkeeping requirements? And do you ever have to request 
assistance from lawyers or other outside consultants to comply 
with the paperwork requirements?
    Mr. Daly. Yes. Basically what we do is--a good example, 
eight to ten years ago, one of my primary parts of being in the 
family business, in the business itself, was I estimated and 
did quite a bit of this task.
    I literally quit doing that because I took on the 
responsibility of making sure that we properly met a lot of 
these regulatory requirements. Since then, I have been able to 
delegate that to one or two people in my office to the extent 
that they were all able to handle it.
    We now keep an attorney on retainer, which we have never 
done before in order to review and look at a lot of what we get 
into.
    Mr. Chabot. Thank you.
    And, Dr.--is it Dr. Katzen?
    Ms. Katzen. Whatever.
    Mr. Chabot. Ms. Katzen. Whatever, yes. What would be the 
drawback to reducing the reporting burdens on small businesses 
seeking to obtain benefit from the government if there would be 
any?
    Ms. Katzen. Well, as a generality, there is no down side to 
reducing burden. What would we be losing since some of the 
parts of the applications are to verify eligibility? You would 
have to have that information if you want to hold the agency 
accountable to say only those who are eligible have received 
the benefit. We read each day in the newspaper about scandals 
that are uncovered where an agency has paid money out, good 
money, good taxpayer money, to people who weren't really 
eligible for the benefit.
    Now, if you eliminated all the forms and you just said, ``I 
want a student loan, whether I qualify or not,'' you would lose 
that ability.
    That is not to say the forms can't be streamlined more. I 
am not saying we are perfect by a long shot, but the answer to 
your question has to be, I think, it depends. It depends on 
what it is you would be cutting out.
    And, if I may, we talk about the IRS being the major source 
of the burden. Some of that is, as I said, the 1040s. Some of 
it is that people can get tax benefits. If you want standard 
depreciation, it doesn't take a whole lot of form filling out. 
But if you want accelerated depreciation, if you want to be a 
subchapter S corporation, if you want to be a limited 
partnership, if you want to take advantage of things which 
Congress, in its infinite wisdom, has decided are necessary and 
beneficial, then it takes filling out forms.
    Now, would you have people simply say, ``I am a small 
business, and I want to accelerate depreciation. So I am just 
going to put down an amount''? What is it that you would be 
reducing in the burden for these people who would be receiving 
a benefit?
    Mr. Chabot. Thank you.
    Mr. Greenblatt, first of all, I just had a question. You 
all were started back in the 1800s, I think you said, and it 
was in Cincinnati. Is that correct or--
    Mr. Greenblatt. No. I'm sorry. NAM, National Association of 
Manufacturers, was established in Cincinnati. My company was 
established in 1968.
    Mr. Chabot. And you were actually established in Baltimore 
at that time?
    Mr. Greenblatt. Actually, we were established in New York. 
In the last ten years, we have been in the State of Maryland, 
in Baltimore City.
    Mr. Chabot. Okay. But the National Association of 
Manufacturers had its origins in Cincinnati, then?
    Mr. Greenblatt. Yes.
    Mr. Chabot. Back in the 1800s?
    Mr. Greenblatt. Yes.
    Mr. Chabot. Okay. All right. Thank you very much.
    I thought something that you had said was particularly 
interesting. You mentioned that, I think, the United States has 
32 percent worse paperwork requirements than other countries 
around the world. And when one considers I guess we are 
including in that communist China, People's Republic of China, 
for example. We are not including in that?
    Mr. Greenblatt. No, no. It is our nine biggest trading 
partners.
    Mr. Chabot. Oh, it is our trading partners only. Okay.
    Mr. Greenblatt. And these are the people that are ruthless 
against us out in the real world.
    Mr. Chabot. So what countries are we talking about?
    Mr. Greenblatt. Canada, Mexico, Japan, China, Germany.
    Mr. Chabot. Well, China. So China would be.
    Mr. Greenblatt. U.K., South Korea, Taiwan, and France. So, 
you know, when we are going up against a Chinese or a Taiwanese 
or a French factory, we have 32 percent more paperwork 
shuffling going on than they do.
    Mr. Chabot. Yes. I mean, that is pretty incredible when you 
consider that somebody like China is on that list, that our 
paperwork requirements are that much more burdensome. And I 
think that shows why we really do need to do a much better job 
of relieving some of this burden that is now on small 
businesses, medium businesses, and large businesses as well.
    If you had to make one change in the Paperwork Reduction 
Act or to do something about what you see on an everyday basis, 
what would you do if you were in one of these seats up here and 
had the ability to make a change in this area?
    Mr. Greenblatt. Well, if there were some sort of rules that 
said every year for the next three years we have to have ten 
percent less paper three years in a row, I still think we can 
get everything we need accomplished. But there would be a lot 
less forms to fill out. There would be a lot less pieces of 
paper to read.
    And the second thing would be if we could make the 
paperwork in English language, as opposed to Washington 
bureaucratese, it would be easier to digest the data and then 
respond quickly.
    A lot of times we get into positions where we are not 
exactly sure what we just read. So we have to have two or three 
people in a room staring at a phrase, ``Does that apply to us? 
Does that rule apply to us? Is that not including us now 
anymore?'' And this is an enormous, monumental distraction. And 
we are looking at things that are not germane to making good, 
quality product or shipping faster.
    One other thing I wanted to mention regarding what Dr. 
Katzen just said about depreciation. I am a small company. And 
we have 13 robots. And we have about a million and a half 
dollars worth of equipment.
    I just got a bill this week from my accountant. To figure 
out my depreciation for this year was $3,500. Okay? Now, that 
is complete waste to shuffle the paper to figure out how much 
my depreciation costs. And, rather than me buying another piece 
of equipment or me hiring a person to work for two months for 
me, instead I'm paying an accountant to figure out a 
depreciation schedule.
    We should have no depreciation schedules. It makes 
accountants very busy, but it doesn't make me more efficient 
against China or France or Germany.
    Mr. Chabot. Thank you.
    And, finally, Mr. Garbini, relative to ready-mixed concrete 
plants, I know that some of your paperwork is obviously from 
the federal government, a considerable amount of it. How much 
of it is from the state or local level as well?
    Mr. Garbini. Congressman, I am not sure exactly how to 
answer that particular question. We might have to come back to 
you about the--I would have to say on the environmental side 
and the safety side we have the same regulatory requirements 
that you see with any small business. So I don't know what the 
proportion would be.
    Bob, do you have any sense of that? No. We would have to 
come back to you with that.
    Mr. Chabot. All right. That's fine. Okay. I will yield 
back, Madam Chair.
    Chairwoman Velazquez. Thank you.
    Mr. Garbini, in terms of the log form that you have to fill 
out regarding short-haul drivers, can you explain how detailed 
these forms are and how much time it takes to complete them? 
Also, does it make sense for a driver traveling in short 
distances to be required to complete a log?
    Mr. Garbini. Well, the form I think was the last one up 
there. And I can have someone bring this up to you so you can 
take a look at it. What it shows, there are four categories in 
there broken down from midnight to midnight. And it shows four 
categories: off-duty, sleeper berth, driving, and on-duty. And 
it is broken down in 15-minute intervals.
    And if you can imagine any driver in a busy day--and 
certainly it is hard on the ready-mixed concrete delivery man, 
who is in and out of a truck--he is dealing on a construction 
job site or he is back at the plant--trying to individually 
stop all of a sudden and fill one of these 15-minute things 
out. It is almost impossible.
    And, by the way, Madam Chairwoman, there are no sleeper 
berths on a ready-mixed concrete truck. So that goes to show 
you how this is misdirected.
    Chairwoman Velazquez. Thank you. Thank you.
    Ms. Katzen, in answering my question commenting about when 
I asked each of the witnesses to comment regarding the 
assertion of the Administrator that, yes, the PRA, Paperwork 
Reduction Act, is working, you mentioned the fact about the 
empirical data. So my question to you is, how do we measure or 
how does OIRA measure whether or not the goals of the Paperwork 
Reduction Act have been accomplished?
    Ms. Katzen. Well, I think there are things that you can 
measure, those are the data that so many people here have 
relied on. What I was alluding to was the impossibility of 
measuring what the situation would be like without the 
Paperwork Reduction Act because there is no counter-factual-
base line to use.
    It is something similar to what Mr. Daly was saying, that 
the cup is probably a quarter to maybe a third full in that the 
PRA has made some difference. But there is a long way to go.
    The ability to measure is essential, but you can't measure 
against what you don't know. I think you used the safety 
example, that there are no safety requirements. If we didn't 
have an air traffic controllers' system, how many plane crashes 
would there be? Who knows? We know how many there are now with 
such a system in place. That leads us to think that maybe it is 
working, although maybe not perfectly.
    I don't think the PRA has as good a track record as the FAA 
and the air traffic controllers, but that is the kind of 
analogy that I was trying to use.
    The problem with measurement, actually, Madam Chairwoman, 
is significant. I don't want to be a skunk at the picnic, but, 
in fact, almost everybody is relying on the Mark Crain study 
that was done for SBA for the nine billion hours. But he takes 
the total regulatory costs, which are not just paperwork. It is 
paperwork plus regulations.
    In my written testimony, I note--and I really want to 
emphasize--that study is not universally acclaimed. Very 
credible sources have pointed out, time and again, that the 
estimate of the total regulatory burden is so impossible that 
OMB has given up that task completely, and then to divide it by 
the number of employees to get a per-employee basis. It is 
particularly significant that he is using the high end, he is 
using 1.1 trillion while OMB has used figures like 34 or--I'm 
sorry--44 billion. There is a huge difference there, which 
makes his bottom line somewhat suspect.
    I do not deny there is a burden. And the time is better 
spent on other things. But before we latch onto that figure and 
say that is the gospel, I would just raise a red flag.
    Chairwoman Velazquez. What really struck me was the fact 
that the Administrator came here. And when I asked specific 
questions or I made specific suggestions, basically there 
weren't concrete recommendations or answers to the Committee. 
And for someone who is there and knows what is happening every 
day, it really makes me wonder.
    I don't think that the Committee has to have all the 
answers. We need to have the type of synergy in terms of the 
people that are working at OIRA to be able to tell us what is 
working, what is not working if consolidation should happen, if 
we should take the responsibility from the chief information 
officer and give it to somebody else if they need more 
resources.
    Ms. Katzen. The chief information officer was assigned this 
task in the 1995 PRA because it was thought essential to have 
someone outside the program office providing a dispassionate, 
objective view of the need for the information collection 
request. The CIO was thought to be that person.
    As I pointed out a couple of years ago in other testimony, 
the CIO official has lots of other responsibilities. And you 
alluded to that, and I thought correctly so. They have got 
their hands full.
    Ours were busy with Y2K. Now there are all sorts of other 
kinds of issues. I think that it is a legitimate inquiry as to 
whether there are other people within the Department, the 
General Counsel's Office, the Office of the Secretary, that can 
perform this second look, this dispassionate objective review.
    And, in any event, OIRA should be following up and 
providing its own objective review. I think you are right to 
press those points.
    Chairwoman Velazquez. Thank you.
    Mr. Chabot, do you have any?
    [No response.]
    Chairwoman Velazquez. Well, again thank you all for your 
insightful information. And I ask unanimous consent that 
members will have five days to submit a statement and 
supportive materials for the record. Without objection, so 
ordered.
    This hearing is now adjourned. Thank you.
    [Whereupon, at 12:13 p.m., the foregoing matter was 
concluded.]

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