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




 
            CRITICAL BUDGET ISSUES AFFECTING THE 2010 CENSUS

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

                                HEARING

                               before the

                  SUBCOMMITTEE ON INFORMATION POLICY,
                     CENSUS, AND NATIONAL ARCHIVES

                                 of the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 16, 2007

                               __________

                           Serial No. 110-58

                               __________

Printed for the use of the Committee on Oversight and Government Reform


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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 HENRY A. WAXMAN, California, Chairman
TOM LANTOS, California               TOM DAVIS, Virginia
EDOLPHUS TOWNS, New York             DAN BURTON, Indiana
PAUL E. KANJORSKI, Pennsylvania      CHRISTOPHER SHAYS, Connecticut
CAROLYN B. MALONEY, New York         JOHN M. McHUGH, New York
ELIJAH E. CUMMINGS, Maryland         JOHN L. MICA, Florida
DENNIS J. KUCINICH, Ohio             MARK E. SOUDER, Indiana
DANNY K. DAVIS, Illinois             TODD RUSSELL PLATTS, Pennsylvania
JOHN F. TIERNEY, Massachusetts       CHRIS CANNON, Utah
WM. LACY CLAY, Missouri              JOHN J. DUNCAN, Jr., Tennessee
DIANE E. WATSON, California          MICHAEL R. TURNER, Ohio
STEPHEN F. LYNCH, Massachusetts      DARRELL E. ISSA, California
BRIAN HIGGINS, New York              KENNY MARCHANT, Texas
JOHN A. YARMUTH, Kentucky            LYNN A. WESTMORELAND, Georgia
BRUCE L. BRALEY, Iowa                PATRICK T. McHENRY, North Carolina
ELEANOR HOLMES NORTON, District of   VIRGINIA FOXX, North Carolina
    Columbia                         BRIAN P. BILBRAY, California
BETTY McCOLLUM, Minnesota            BILL SALI, Idaho
JIM COOPER, Tennessee                JIM JORDAN, Ohio
CHRIS VAN HOLLEN, Maryland
PAUL W. HODES, New Hampshire
CHRISTOPHER S. MURPHY, Connecticut
JOHN P. SARBANES, Maryland
PETER WELCH, Vermont

                     Phil Schiliro, Chief of Staff
                      Phil Barnett, Staff Director
                       Earley Green, Chief Clerk
                  David Marin, Minority Staff Director

   Subcommittee on Information Policy, Census, and National Archives

                   WM. LACY CLAY, Missouri, Chairman
PAUL E. KANJORSKI, Pennsylvania      MICHAEL R. TURNER, Ohio
CAROLYN B. MALONEY, New York         CHRIS CANNON, Utah
JOHN A. YARMUTH, Kentucky            BILL SALI, Idaho
PAUL W. HODES, New Hampshire
                      Tony Haywood, Staff Director


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on October 16, 2007.................................     1
Statement of:
    Wolfe, Otto J., Chief Financial Officer and ASA, U.S. 
      Department of Commerce; and Charles Louis Kincannon, 
      Director, Bureau of Census.................................    12
        Kincannon, Charles Louis.................................    12
        Wolfe, Otto J............................................    12
Letters, statements, etc., submitted for the record by:
    Clay, Hon. Wm. Lacy, a Representative in Congress from the 
      State of Missouri, prepared statement of...................     3
    Kincannon, Charles Louis, Director, Bureau of Census, 
      prepared statement of......................................    15
    Maloney, Hon. Carolyn B., a Representative in Congress from 
      the State of New York, letter dated October 15, 2007.......     9


            CRITICAL BUDGET ISSUES AFFECTING THE 2010 CENSUS

                              ----------                              


                       TUESDAY, OCTOBER 16, 2007

                  House of Representatives,
   Subcommittee on Information Policy, Census, and 
                                 National Archives,
              Committee on Oversight and Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10 a.m. in 
room 2154, Rayburn House Office Building, Hon. Wm. Lacy Clay 
(chairman of the subcommittee) presiding.
    Present: Representatives Clay, Maloney, Hodes, and Cannon.
    Staff present: Darryl Piggee, staff director/counsel; Jean 
Gosa, clerk; Michelle Mitchell, legislative assistant, Office 
of Wm. Lacy Clay; Jim Moore, minority counsel; and Jay 
O'Callaghan, minority professional staff member.
    Mr. Clay. The Information Policy, Census, and National 
Archives Subcommittee of the Oversight and Government Reform 
Committee will now come to order.
    Today's hearing will examine issues surrounding the fiscal 
year 2008 continuing resolution and its affect on the 2010 
census. The hearing will review plans to scale back, cancel, or 
delay the 2008 dress rehearsal. We will look at issues 
surrounding the contract for hand-held computers, as well as 
the startup and staffing of the Census regional offices for the 
2010 census.
    In addition, we shall inquire about the effect of the CR on 
the recently awarded communications contract and other issues 
related to the 2010 census.
    Without objection, the Chair and ranking minority member 
will have 5 minutes to make opening statements, followed by 
opening statements not to exceed 3 minutes by any other Member 
who seeks recognition.
    Without objection, Members and witnesses may have 5 
legislative days to submit a written statement or extraneous 
materials for the record.
    I will begin with the opening statement.
    Congress has routinely exempted the census from the flat-
line funding requirements of a CR in other years, most notably, 
in 1998 and 1999 prior to census 2000. Early this year Commerce 
Department officials testified before both the House and the 
Senate and made it clear that a CR which did not exempt the 
Bureau of the Census would have significant negative 
consequences for the intricate decade-long plan for the 2010 
census. Administration witnesses emphasized that without such 
language, a CR would drastically jeopardize the accuracy, cost, 
and coverage of the 2010 census.
    Congress and the administration agreed on this CR without 
this important language, and we are not faced with an apparent 
crisis.
    A the Census Bureau ramps up to the 2010 census, its annual 
appropriations will grow exponentially. Indeed, in fiscal year 
2008 the Census Bureau will receive almost a 40 percent 
increase in funding. The dress rehearsal for the 2010 census is 
scheduled to occur in less than 5 months. This is the last 
chance to test the vast changes in the census design. What the 
administration touts as the re-engineered census.
    Census officials tell us that the CR may make it impossible 
to fund the final phase of the dress rehearsal, which could 
mean that the first time in 40 years we cannot test the final 
census design, even as we undertake the most significant reform 
of the decennial since the advent of the long form.
    Our goal today is to start the process to ensure that, as 
negotiations commence for the next CR, we take definite steps 
to ensure that: one, there will be no scaling back, 
cancellation, or delay in the dress rehearsal as planned; and, 
two, nothing in the CR language will hinder, delay, or deny the 
plan, funding, and execution of the contract for the hand-held 
computers, the advertising program, the partnership program, or 
the data capture program; and, three, that OMB will use every 
means necessary to grant Bureau of the Census officials any 
waivers or exemptions from administration spending restrictions 
in order for them to meet these requirements.
    We will look at some of the potential problems that have 
arisen and how to solve or avoid these pitfalls. I look forward 
to the testimony of the witnesses.
    [The prepared statement of Hon. Wm. Lacy Clay follows:]

    [GRAPHIC] [TIFF OMITTED] T3196.001
    
    [GRAPHIC] [TIFF OMITTED] T3196.002
    
    [GRAPHIC] [TIFF OMITTED] T3196.003
    
    Mr. Clay. I will yield now 5 minutes to the ranking 
minority member, Mr. Cannon.
    Mr. Cannon. I want to thank Chairman Clay for convening 
this hearing. It is unusual for us to have a hearing on such 
short notice, and ordinarily the minority might complain, but 
in this situation we see a real emergency happening here which 
requires Congress' immediate attention. In this particular 
case, Congress actually bears the burden for creating this 
crisis at the Census Bureau.
    In a continuing resolution passed by Congress last month, 
Congress failed to include the appropriate increase in funding 
necessary to ensure the planning, testing, and development of 
the 2010 census so that could continue. This funding error 
creates a serious time crunch for the Census Bureau. For the 
2008 dress rehearsal to be a serious test of census readiness, 
it has to happen beginning April 1, 2008.
    In an editorial last Tuesday, the New York Times made the 
case by saying, ``On the chopping block, a test of the Bureau's 
plans and procedures for counting people on military basis, 
which was to have been part of the dress rehearsal at Fort 
Bragg in North Carolina. With no additional funds coming in, 
the Bureau has already had to advise the Federal contractor 
working on the hand-held computers for the next census that it 
will not be able to pay for the personnel it has contracted 
for, necessitating layoffs. Any glitch in the computerization 
increases the chances for inaccuracy.''
    Oddly enough, the Times tries to blame the White House for 
this problem--imagine my surprise--but the fact of the matter 
is that the 2010 census is a constitutionally mandated 
function, not just another program. The restructure of the 
House of Representatives relies on an accurate decennial 
census.
    When the Republicans were in the majority, we insisted that 
the Bureau receive funding and we didn't wait for White House 
permission to start insisting. It is my hope that the Democrat 
majority will do the same.
    I thank you, Mr. Chairman, and I yield back.
    Mr. Clay. I thank the gentleman for his statement.
    Now we will recognize the gentlelady from New York, Mrs. 
Maloney, for her opening statement.
    Mrs. Maloney. I thank you, Chairman Clay, and the ranking 
member for holding this hearing today. And I thank our 
witnesses for testifying. I especially want to thank outgoing 
Census Director Louis Kincannon, who has done an excellent job 
leading the Census Bureau for the past 5 years, and this Nation 
owes you gratitude for your service.
    This will probably be the last time you will appear before 
us, and I want to acknowledge your dedication and your fine 
work and publicly thank you.
    We are here today to talk about a very serious problem that 
could and should have easily been avoided. As my colleague, Mr. 
Cannon, pointed out, the census is one thing you cannot put 
off. It is mandated in the Constitution. It has to take place. 
This mistake has delayed the funding, it has put off the dress 
rehearsal, and we may not even be able to use new technology 
that the Census Bureau had been developing to cut costs and be 
more efficient.
    The Government, as it has done in recent years, is 
currently working under a continuing resolution for the 
beginning of fiscal year 2008. This year the CR is set at 
fiscal year 2007 levels. Many agencies can make do with funding 
at the previous year's level for a few weeks, but 2 years away 
from the 2010 census that is absolutely impossible for the 
Census Bureau. They need to have their funding to get the job 
done.
    The Census Bureau funding for fiscal year 2008 was slated 
to increase by 40 percent from last year, according to the 
President's budget request, in order to fund the preparation 
for the decennial census.
    This is not a new problem. In 1998 and 1999, during the 
ramp-up to the 2000 census, the Government was funded by a CR 
at the beginning of those fiscal years. Those CRs made 
provisions for the increased expenses of ramping up to the 
census. While there may have been other issues that affected 
the 2000 census, funding was not one of them.
    The difference with this census seems to be that the 
administration did not, for some unexplained reason, ask the 
Congress to include routine language to exempt the Census 
Bureau from the flat-line funding because of the importance of 
the census. In 1998 and 1999 a Republican Congress included 
these exceptions for the increased ramp-up of cost of those 
years at the request of the Democratic administration, even 
though the census in those years was itself a very contentious 
issue.
    This makes the question why the administration did not ask 
for an exception even more puzzling. Was it just incompetence? 
Let's be clear. This is not a hearing about a potential problem 
or a threat, but a real actual damage to the 2010 census.
    The ability of the career professionals at the Census 
Bureau to carry out the census and provide the country with the 
most accurate numbers has already been adversely affected. 
Without an immediate exception to get funding to the census, 
the accuracy of the 2010 census will suffer even more 
dramatically.
    I hope we can hear from Director Kincannon exactly which 
components of the dress rehearsal and other key test exercises 
that have been part of every census since 1970 have actually 
been curtailed and canceled. I also want to hear what the 
impact of the 400 person layoff from the contractor who 
designed the new hand-held GPS devices will be. These hand-held 
computers were designed to improve efficiency and accuracy and 
save the census cost by at least $1.5 billion. Not being able 
to go forward is costing the country not only financially, but 
also in our efficiency and accuracy.
    As I understand it, it means that the fielding of the 
device for the 2010 census is now uncertain. I have been told 
that the Census Bureau has already said that the scheduled test 
of group quarters at Fort Bragg military base in North Carolina 
will be canceled if the funds are not available before November 
16th. A number of Members of Congress who represent the 
military and military bases are very, very disturbed about 
this, because counting them and their families in a census is 
part of our Constitutional responsibility, but also honors the 
work that they are doing for us that they are included in this 
important census.
    I hope we can hear about how we can get there, how we got 
there, but what have we already lost, what is in jeopardy, and 
what concrete steps can and should be taken to prevent any more 
damage.
    Along those lines, I do want to commend Commerce Secretary 
Gutierrez for acting quickly on the committee's request to move 
almost $7 million from Commerce activities to the census. This 
was a very positive step. I want to find out from Director 
Kincannon if, in fact, it can be done.
    I would like to put in the record the letter that was 
received from Commerce from Nathaniel Winneke, and I would like 
to put the letter in the record, as we did receive this 
document last night that they were moving the $7 million.
    Mr. Clay. Without objection, the letter is in the record.
    [The information referred to follows:]

    [GRAPHIC] [TIFF OMITTED] T3196.004
    
    [GRAPHIC] [TIFF OMITTED] T3196.005
    
    Mrs. Maloney. Director Kincannon, when you resigned, you 
cited a lack of support for the census as one of the reasons 
that you resigned, and I am sorry to say that, despite the 
Secretary's effort in transferring $7 million, it sounds like 
the census is still not getting the support that it wants and 
that it needs. I hope you can tell us how we got here, and I am 
particularly interested to hear from OMB and Director Nussle as 
to what he thinks needs to be done.
    Thank you very much, and I look forward to your testimony. 
Thank you.
    Mr. Clay. Thank you.
    If there are no additional opening statements, the 
subcommittee will now receive testimony from the witnesses 
before us today.
    I want to start by introducing our panel. Invited to appear 
today were two gentlemen who are not here this morning, and 
they are the Honorable Jim Nussle, Director of the Office of 
Management and Budget, and the Honorable Jay Waite, Deputy 
Director, Bureau of the Census. These gentlemen are not present 
this morning; however, it is our hope that the witnesses that 
are in attendance will help us examine what steps Commerce and 
the Census Bureau are taking to make sure that going forward 
the right decisions about resources and priorities are made.
    In attendance and prepared to address the subcommittee this 
morning we have the Honorable Charles Louis Kincannon, Director 
of the Bureau of Census; and the Honorable Otto J. Wolfe, Chief 
Financial Officer and Assistant Secretary for Administration of 
the U.S. Department of Commerce.
    As mentioned previously, the Honorable Charles Louis 
Kincannon, Director of the Bureau of Census, was nominated by 
President George W. Bush for Director of the Census on July 27, 
2001, and the Senate confirmed him unanimously on March 13, 
2002. Of course, Mr. Kincannon began his career with the Census 
Bureau years ago, and we are all proud of his service to this 
Nation. We certainly look to him for direction when it comes to 
issues related to the census. I am certainly proud to say that 
I know Mr. Kincannon and I look at him as a friend.
    Mr. Wolfe was sworn in on August 7, 2001, as the Chief 
Financial Officer and Assistant Secretary for Administration at 
the U.S. Department of Commerce. As the CFO/ASA he oversees the 
Commerce Department's $5.6 billion budget and its facilities 
worldwide. He exercises Department-wide responsibility for a 
broad range of administrative functions, including strategic 
planning, financial management, budgeting, procurement, 
financial assistant, security, human resources, civil rights, 
small business utilization, and personal and real property 
management. These duties include implementation of management 
reforms throughout Commerce. Mr. Wolfe's career in public 
service includes extensive experience in both the executive and 
legislative branches of Government.
    Let me welcome both of you here. Thank you for appearing 
before the subcommittee today.
    It is the policy of this subcommittee to swear in all 
witnesses before they testify.
    [Witnesses sworn.]
    Mr. Clay. Let the record reflect that the witnesses 
answered in the affirmative.
    I ask that each of the witnesses now give a brief summary 
of their testimony, and to keep their summary under 5 minutes 
in duration. Your complete written statement will be included 
in the hearing record.
    Mr. Wolfe, let's begin with you.

 STATEMENTS OF OTTO J. WOLFE, CHIEF FINANCIAL OFFICER AND ASA, 
   U.S. DEPARTMENT OF COMMERCE; AND CHARLES LOUIS KINCANNON, 
                   DIRECTOR, BUREAU OF CENSUS

                   STATEMENT OF OTTO J. WOLFE

    Mr. Wolfe. Mr. Chairman, I do not have a prepared 
statement. I would be more than happy, though, at the 
completion, at your request, to answer any questions that you 
may have.
    Mr. Clay. Thank you very much. That is the briefest 
statement we have had on record so far.
    Mr. Kincannon, you may give us your opening statement.

              STATEMENT OF CHARLES LOUIS KINCANNON

    Mr. Kincannon. Thank you, Mr. Chairman. I knew that would 
be a prize winner in your score, and you get a gold star on 
that.
    Chairman Clay and Mr. Cannon, Mrs. Maloney, thank you very 
much for inviting the Census Bureau to appear today to discuss 
the critical budget issues affecting the 2010 census. In 
particular, I will be addressing our current situation, which 
has us functioning under a continuing resolution at fiscal year 
2007 funding levels through November 16th. This is dramatically 
less than the President's budget request, and is about half 
what we need to continue the essential preparations needed for 
the 2010 census.
    The U.S. Census Bureau has been on record for quite some 
time stressing that the effect of an appropriation below the 
level of the President's request for any extended period of 
time--that is sort of beyond November 16th--would have serious 
consequences. Earlier this year in March, in April, in May, and 
July we made clear in testimony before Congress and in answers 
to questions for the record that we could not continue 
developing all our systems for the dress rehearsal and the 2010 
census in the event of funding below the President's request, 
either the final appropriation or under a continuing 
resolution.
    We are preparing for the dress rehearsal in 2008. We are 
simultaneously developing the major systems we need to conduct 
the census, including the hand-held computers that will be used 
in the 2010 census for the first time.
    By law, the decennial census must occur as of April 1, 
2010, and the results must be submitted to the President in 
December of that same year. These dates cannot be altered when 
preparations are delayed. We cannot buy back the time that we 
are losing. When the appropriation requested in the President's 
budget is delayed, we lose that time and cannot always make it 
up.
    Because of the delay in funding under the current CR, we 
must now implement a plan to delay and down-scale the dress 
rehearsal in order to manage through the CR period. Our to 
police priority is maintaining the ability to test the hand-
held computers and the attendant data capture operations, 
because they are essential to the re-engineered census. This 
new system will enhance efficiency and accuracy, reduce the 
amount of paper, and save money, but we cannot use the new 
devices in the decennial without conducting a full systems 
test; therefore, our plan now is to conduct a reduced-scope 
dress rehearsal in late spring or early summer of next year 
that focuses on testing the hand-held computers, including the 
critical interfaces with the data capture system.
    Under a reduced-scope dress rehearsal, other smaller but 
important census operations will not be tested prior to 2010. 
The operations we are removing from the dress rehearsal are 
operations that we have done successfully in the past. We will 
not test our procedures for counting people who live in college 
dormitories, military barracks, prisons, or nursing homes, what 
we call group quarters.
    We also will not test the Be Counted Program, which 
provides an opportunity for people who believe they were missed 
to make sure they were included in the census counts.
    These are just two of the important operations that will 
not be tested in this dress rehearsal. I will provide a 
complete list of operations affected for the record.
    We will still conduct these operations in 2010, and we are 
confident we will implement them effectively; however, because 
the operations are currently planned using new systems and 
somewhat changed procedures, there is some risk, some attendant 
increase in risk for the 2010 census. If we have problems with 
untested operations in 2010, it could result in an increase in 
overall cost, and perhaps a reduction of census accuracy in 
some way. However, because we have done these operations 
before, we are willing to operate with this level of potential 
new risk.
    If funding is delayed beyond November 16th, the situation 
becomes more dire for us. It will call into question our 
ability to conduct the systems test at all. We cannot fly blind 
into the 2010 census with a new system that is untested.
    There was a recent GAO report published that asserted that 
the level of risk in the 2010 census program was excessive and 
we should be taking steps to mitigate the risk in the census 
operations. We are looking at our options if we have to 
function under a longer CR at fiscal year 2007 levels, and I 
can assure you we are committed to conducting the best census 
possible, whatever the situation, but we need the funding 
levels in the President's budget as soon as possible.
    Let me close by observing, as Mr. Maloney did, that this 
may well be my last appearance before a congressional committee 
as Director of the Census, but I have said that before and have 
been proven wrong. I told the chairman that I might have to ask 
the President for a pardon along with a Thanksgiving turkey to 
release me from this. I wish the circumstances were happier, 
and they may turn out to be quite happy, but perhaps some good 
may still come of our present difficulties if we can create a 
mutual result to avoid a situation like this in the future.
    For years ending in seven, eight, nine, and zero budgets 
for the decennial census typically increase significantly over 
prior years. History teaches that we cannot count on the 
appropriation process to meet the long-planned and agreed 
program needs in the first quarter of the fiscal year. I don't 
believe anyone wants to continue to repeat this predicament 
year after year. The Census Bureau would like to work with the 
committee to see if there is an arrangement that will avoid 
getting us into this particular trap.
    Mr. Chairman and members of the committee, I appreciate 
your attention to this, and I am happy to take your questions.
    [The prepared statement of Mr. Kincannon follows:]

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    [GRAPHIC] [TIFF OMITTED] T3196.007
    
    Mr. Clay. Thank you, Mr. Kincannon.
    We will now move to the question period for Members and 
proceed under the 5-minute rule.
    Mr. Kincannon, the Census Bureau indicates that, with the 
reduction in funding resulting from the existing CR, they will 
be forced to forego parts of the vital dress rehearsal, while 
delaying and limiting the scope of others. As a result, a test 
of group quarters in North Carolina involving the Fort Bragg 
Military Base will have to be eliminated from the dress 
rehearsal.
    The subcommittee is generally aware that, as a result of 
recent modernization of U.S. military bases as part of the BRAC 
process and new leasing authorities that have resulted in new 
family quarters being constructed, that there may be more 
military dependents living on base as compared to 2000. This 
will deprive the Bureau of an opportunity to test its plans and 
make the requisite changes to ensure that our military 
personnel are accurately and fully counted.
    Director Kincannon, is this true? And what other decennial 
planning activities has your staff had to cancel or delay as a 
direct result of the lack of CR language to grant the Census 
Bureau spending flexibility?
    Mr. Kincannon. Well, the portion of enumeration on military 
bases that we have canceled is of persons living in barracks, 
not of persons living in houses and other kinds of situations 
on bases. We are confident that we can do a good job of 
counting military in barracks, and we would not put that at 
risk if we do not do that in the dress rehearsal, although the 
reason that the Fayetteville area was selected as a dress 
rehearsal site was to make sure that this worked like 
clockwork. But we are confident we can carry it out.
    Mr. Clay. What is your drop-dead date for your decision to 
cancel the dress rehearsal in North Carolina, and what is the 
date for canceling it altogether?
    Mr. Kincannon. Well, we won't make that decision until, I 
guess, the week of November 17th, but then we have to face up 
to whether we will be able to test the hand-helds and the 
electronic system that receives all the inputted data. If we 
can't test that in time to make corrections that would be 
needed in the instruments that were going to be used before 
heading into the census, then I think we have to reconsider our 
plans and cancel the entire dress rehearsal.
    Mr. Clay. You know, the field data collection automation 
contract and the decennial response integration contract have 
been given a limitation of funds notice, which will result in a 
reduction of the pace of work on these two critical contracts. 
This slow-down at this critical time will directly impact the 
timing of the testing of data transmissions between these two 
systems that is critical to the 2010 census. In 2010 these two 
systems will be the core of the transmittal of information 
between the field and Bureau headquarters.
    If these systems cannot be tested soon, it will eliminate 
the opportunity to prevent duplication and redundancy in the 
non-response followup. What specifically is being done to 
address the reliability and performance of the field data 
collection automation program, including the hand-held devices 
that are part of the 2010 enumeration activities?
    Mr. Kincannon. Well, if the software can be completed in 
time to conduct the dress rehearsal substantially as planned, 
at least as far as mailing out and returning the questionnaires 
and doing non-response followup with the hand-held computers, 
we will be able to do a start-to-finish test of the 
functionality of that whole system and the way the two systems 
interact.
    If we don't have that in a timely way, then we won't be 
able to do that, and the risk of trying to use the hand-helds 
untested is not warranted.
    Mr. Clay. I thank you for that response.
    How confident are you that these devices will perform as 
intended during the 2008 dress rehearsal?
    Mr. Kincannon. I have a high level of confidence, but that 
doesn't mean I want to skate all the way out on that ice with a 
backpack and half a million temporary workers trying to carry 
them out. These devices, the hand-held computers, were used 
successfully in the first phase of the dress rehearsal, the 
local update of the address canvas, and the address canvas was 
completed on time, but we did run into shortcomings in the 
software that delayed some of the work and we had to install 
software patches and so on. We discovered things that needed to 
be modified. That is the purpose of doing the dress rehearsal.
    We still were satisfied with the way that they worked, but 
only a limited part of the functionality of the hand-held 
computers was tested in address canvassing, so we still have 
the major functionality to test and the non-response followup, 
and that is where the main money is saved through using hand-
helds.
    Mr. Clay. Thank you for that.
    Mr. Cannon, you are recognized for 5 minutes.
    Mr. Cannon. One wonders if we are kin. I may have made that 
joke before.
    Mr. Kincannon. I feel a kinship.
    Mr. Cannon. Thanks for being here. Your job is terrifically 
hard, as I have expressed in the past, and I am comforted 
knowing that you are there doing it, and this is remarkably 
important.
    Let me just ask, in particular as it relates to the current 
issue, at the end of the day it is our job here in Congress to 
do this, to make sure the census is funded. It is 
constitutionally mandated, and it bears directly on how the 
House is organized.
    What assurances have you had, Mr. Kincannon, from House 
leadership that this matter will be dealt with and we will get 
the testing done to make every single person count for the next 
census? Have you talked to Houses leadership about assuring 
that they will work to get these funds in the bill, in the next 
CR?
    Mr. Kincannon. Mr. Cannon, the House leadership has been 
very reassuring, but they were also reassuring that the 
President's budget would be passed before October 1st. The fact 
is, no single person can assure an appropriation will pass a 
certain way at a certain time. It depends on cooperation, to a 
degree, but broadly, as you know, and that is not easy to do.
    Mr. Cannon. That is certainly the case. But has the 
majority leadership said they will make this a priority?
    Mr. Kincannon. Yes, sir.
    Mr. Cannon. Great. Thank you very much.
    We have talked in the past about the problem that Utah had 
whereby a difference of a grand total of 36 individuals, 
counted fairly or not. Utah ended up without a fourth 
congressional seat. We are not going to make that up 
legislatively by changing the number of Members of the House 
and adding the District of Columbia, apparently, since the 
Senate failed to see the urgency of that matter. So I am again 
concerned about what we do to count missionaries who are 
residents of States but serving for brief periods of time 
outside the State. Is that an issue that you are dealing with 
as you evaluate the next census, Mr. Kincannon?
    Mr. Kincannon. We do not plan any effort in the next census 
to count American citizens living overseas except those who are 
serving in the military or Federal civilian Civil Service.
    Mr. Cannon. We have actually been through that a bit. Of 
course, the State that houses Fort Bragg has the tendency to 
encourage people to identify with that State, even if they have 
come from other areas, and I think that State has a tendency, 
therefore, to have a bit of an advantage, but is there a reason 
for not counting Americans overseas, who are overseas 
temporarily, not forever, but also more than a few weeks on 
vacation?
    Mr. Kincannon. We don't know how to systematically, 
uniformly count Americans resident overseas.
    Mr. Cannon. Well, there are subsets of groups of people 
that go overseas. There are 50,000 Mormon missionaries who are 
missionaries around the world, including in the United States. 
I am not sure how many of those are overseas or not. Baptists 
have a fairly significant missionary force around the world. In 
many cases, these are young people who can be counted with 
their families. In many cases they are adult couples who spend 
18 months overseas. That is a big deal for the State of Utah, 
and Utah has been growing at a very rapid rate. I am not sure 
we are lined up for a fifth seat yet, but at some point those 
people, our Utahans, they have left for a relatively short 
period of time. Is there not something we can do to help 
identify those people?
    Mr. Kincannon. I don't know. Perhaps it would be more 
practical to encourage them to be home for a month in 2010 so 
they can be accurately counted in Utah, and a little recharging 
of their religious batteries and go back to the fray.
    Mr. Cannon. These people only leave for a relatively short 
period of time, so they actually don't need their batteries 
recharged. Of course you are joking. At least I see at this 
point a smile on your face as you say that. It is actually 
quite a serious matter in Utah. Literally counting 36 people in 
the face of, what, we had 13,000 people that were parts of 
households. Have you thought of encouraging people to count or 
can you count children that are over 19, over 18, who are 
living outside the country as part of the household?
    Mr. Kincannon. There are a set of what we call residents' 
rules that we try to communicate to respondents to use in 
understanding who they count in their household and who not. 
Some of them are straightforward; some of them are a little 
more complicated. The law requires that people respond honestly 
to the census, and I think most people do. We have no way to go 
back and say, did you count someone who is actually in France 
for a year and a half? We can't do that. If people answer, we 
assume they answer honestly, unless there is some manifest----
    Mr. Cannon. What would be the honest answer if a 20-year-
old son is in France and has been there for a year and expects 
to be there for another year, and his parents are asked how 
many children they have in their household?
    Mr. Kincannon. The honest answer, based on rules that date 
back to the Census Act of 1790, is that they would not be 
counted there.
    Mr. Cannon. 1790 was a great year, but we didn't have 
planes and phones and other kinds of things. Can we change that 
rule?
    Mr. Kincannon. It was an act of Congress, and if Congress 
can agree to a change then they can direct it.
    Mr. Cannon. So these are not rules that the Census 
Department has issued? That is a congressional mandate? And can 
you state for me what it is that makes a person a resident? If 
someone is out of town for 2 weeks, I take it they are counted 
by their parents appropriately.
    Mr. Kincannon. Where they usually live most of the time. If 
they are on a trip for a month but usually live in Salt Lake 
City or Provo, then an honest answer would be Salt Lake City or 
Provo. If they are gone for 2 years, I think an honest answer 
would be they are not residing in the household.
    Mr. Cannon. And you think that would take a change of law; 
that is, a legislative act?
    Mr. Kincannon. That is my understanding.
    Mr. Cannon. I think the light is actually off, Mr. 
Chairman. I suspect I have surpassed my time.
    Mr. Clay. The gentleman's time has expired, but on the 
point that you make, there are also those who are in State 
institutions for extended stays also.
    Mr. Cannon. Right.
    Mr. Clay. And there is an issue about how we count those 
individuals. Maybe there is a legislative solution.
    Mr. Cannon. Well thank you, Mr. Chairman. I would love to 
work with you on this issue.
    Mr. Clay. Right.
    Mr. Cannon. For Utah it is a huge disproportionate fact of 
our lives.
    Mr. Clay. We would like to explore it also. Thank you.
    The gentlelady from New York, Mrs. Maloney, for 5 minutes.
    Mrs. Maloney. I thank the chairman.
    Now, Mr. Kincannon, I am not on the Appropriations 
Committee, but I understand from my leadership and from 
statements by various White House officials, even the 
President, that the White House insisted over and over again 
that they wanted a clean CR, meaning no anomalies or add-ons on 
top of it. But, in fact, the OMB requested and the Congress 
granted about a dozen such anomalies for the war in Iraq and 
the DOD and the Homeland Security missions, and even for the 
Department of Agriculture to be able to continue grading 
cotton.
    Director Kincannon, did you ask the Department for anomaly 
language?
    Mr. Kincannon. You know, discussions and ongoing process 
and the ongoing process of the budget are internal to the 
administration.
    Mrs. Maloney. Pardon me? You did ask for it? Yes or no?
    Mr. Kincannon. I didn't answer that question. I am not 
going to answer that question.
    Mrs. Maloney. Pardon me?
    Mr. Kincannon. I am not going to answer that question. That 
is not the practice that is followed in the administration, in 
the executive branch of Government. We don't talk about our 
individual budget discussions back and forth between the 
different levels of review in the administration. The final 
decisions were made based on large number of factors that are 
considered, and that is what goes up.
    I have worked 35 years in the executive branch, 6 of those 
years at OMB, and I understand that is a logical practice and 
not just somebody's directive.
    Mrs. Maloney. Well, this is a congressional hearing, and we 
are having a problem because you didn't get your funding, and 
we want to find out why, because it is going to cost us money, 
it is going to cost efficiency. It may delay the census on 
which we base our Members of Congress and also the funding 
levels for localities. It is very, very important. So you are 
telling me that you can't tell me whether or not you asked for 
the appropriate budget for your Department? Is that what you 
are saying? That is a secret discussion?
    Mr. Kincannon. No. We asked for the appropriate funding and 
the President proposed it in the budget he sent up last 
February.
    Mrs. Maloney. OK.
    Mr. Kincannon. And the Congress did not vote that 
appropriation by October 1st.
    Mrs. Maloney. OK. Did OMB ever reject your request for 
funding? Did they request it? Did they reject it?
    Mr. Kincannon. I consider that internal.
    Mrs. Maloney. Pardon me?
    Mr. Kincannon. I consider that an internal administration 
discussion, and----
    Mrs. Maloney. That is an internal administration 
discussion?
    Mr. Kincannon. Yes.
    Mr. Cannon. Would the gentlelady yield?
    Mrs. Maloney. I will yield at the end of my questioning, 
not now. Not now. I am not yielding now----
    Mr. Cannon. I support the gentlelady's inquiry.
    Mrs. Maloney. OK. Thank you. OK. Did OMB realize the 
consequences of not having this increase and anomaly? Did they 
realize it?
    Mr. Kincannon. I believe we have discussed so broadly the 
consequences of not having the money appropriated that 
appropriate people in OMB and the Congress and in our Advisory 
Committees and in the various census support and user groups 
all understood serious consequences would result from not 
having that money at the beginning of the fiscal year.
    Mrs. Maloney. So they thoroughly understood the 
consequences for the dress rehearsal and the impact on the cost 
and efficiency with the hand-helds and all the other census 
planning? That was discussed thoroughly?
    Mr. Kincannon. I believe that was discussed thoroughly with 
many groups of people.
    Mrs. Maloney. And what was their response? Did OMB tell you 
how to solve these problems?
    Mr. Kincannon. No. OMB did not tell us how to solve the 
problem. They asked us how we were going to solve the problem. 
That is the usual drill. And the committees, the Appropriations 
Committees asked us how we were going to accommodate the CR, 
and we responded in both cases consistently, of course.
    Mrs. Maloney. So did OMB give you any directives or orders 
on how to handle the funding deficiency in this CR?
    Mr. Kincannon. No. They asked us how we were going to 
accommodate the spending levels authorized in the CR.
    Mrs. Maloney. Did they instruct you on any specific changes 
to the census design that they wanted?
    Mr. Kincannon. No, they did not.
    Mrs. Maloney. They did not?
    Mr. Kincannon. I don't know whether I would answer that if 
I knew, if I knew an answer that was different than no, but 
that is the----
    Mrs. Maloney. And can you tell us specifically what 
decennial planning activities your staff has had to cancel or 
delay as a direct result of the lack of CR language to grant 
the Census Bureau spending flexibility? Exactly what have you 
had to cancel or delay so far?
    Mr. Kincannon. What we will plan to do, but it will be on a 
delayed schedule, and I can't say how much delayed now, we plan 
to mail out questionnaires in the mail-out mail-back areas. 
This includes the bilingual forms and neighborhoods that are--
--
    Mrs. Maloney. Is this the American Community Survey you are 
talking about?
    Mr. Kincannon. No. This is in the dress rehearsal.
    Mrs. Maloney. This is the dress rehearsal?
    Mr. Kincannon. This is the dress rehearsal.
    Mrs. Maloney. Yes.
    Mr. Kincannon. We are continuing the American Community 
Survey within the bounds of the continuing resolution because 
it is a continuing program. It is accommodated there.
    Mrs. Maloney. So you had to cancel certain aspects of the 
dress rehearsal?
    Mr. Kincannon. Yes.
    Mrs. Maloney. Specifically what aspects of the dress 
rehearsal?
    Mr. Kincannon. Well, what we won't do is the new 
construction program, which is an opportunity for local 
governments to come in and identify new housing construction 
that occurred since the local update of census addresses. We 
have canceled the update leave activity where the Census Bureau 
delivers questionnaires at the same time that they spot a 
location on a map for housing in rural areas mostly that does 
not have city-type addresses or association of an address with 
that housing unit if they get their mail at the Post Office or 
if they get their mail from a box on a road somewhat removed 
from the physical location.
    We canceled the group quarters advanced visit, where we go 
to arrange for enumeration timing and other info that we will 
need to conduct an enumeration there.
    We have canceled the group quarters enumeration, including 
the groups that I mentioned before.
    We have canceled service-based enumeration in the dress 
rehearsal, including shelters, soup kitchens, and mobile food 
vans.
    We canceled enumeration of transient locations, including 
campgrounds, marinas, and hotels and motels.
    We have canceled questionnaire assistance centers, where 
you could walk in and get some help filling out your 
questionnaire.
    We have canceled the Be Counted Program, where if you think 
you haven't been counted, you can pick up in various locations, 
like a Post Office, a Were You Counted Form, fill it out, send 
it in, and we determined whether you have already been counted, 
and if not we add you in.
    We have, because we are not doing Be Counted, we have 
canceled the processing whereby we would geocode those forms.
    We have canceled the field verification of new addresses 
reported on Be Counted forms, because there won't be any Be 
Counted forms.
    We have canceled all census coverage measurement housing 
unit field operations other than the independent listing that 
we are going to carry on.
    And we have canceled all census coverage measurement 
housing matching operations.
    We have also canceled assessments of the operations that 
were dropped, which is sensible. You can't do that, really.
    There are some things still to be decided, like will we 
conduct a partnership program for the dress rehearsal. All 
these things are attached to the words ``dress rehearsal.''
    We have not determined when census day will be for the 
dress rehearsal because we don't know how long the delay will 
be. We have not determined whether we will drop one of the 
dress rehearsal sites, and, if so, which one and when. We do 
not know whether we will drop the coverage followup operation. 
We have not determined whether we would do race and Hispanic 
origin response coding. And we have not determined whether we 
will provide a telephone questionnaire assistance.
    We do not know whether we will provide fulfillment for 
questionnaires in English, Spanish, and Chinese.
    We have not determined whether we will conduct all data 
processing, response processing, and produce redistricting type 
prototypes that would help States in planning their 2010 
redistricting programs. Those are at-risk programs, but we 
haven't decided those.
    Well, there are only two more, I think. Will we conduct 
person matching and person followup for the census coverage 
measurement program? We don't know. Haven't determined that 
yet. Depends on what other things are done.
    And we have not determined whether we will use prototype 
estimates of net and component coverage errors from the dress 
rehearsal CCM program.
    Mr. Clay. The gentlelady's time has expired.
    Mrs. Maloney. Could I just say that is quite a list.
    Mr. Clay. It is quite a list. The gentlelady's time----
    Mr. Cannon. I ask unanimous consent that the gentlelady's 
time be extended for an additional minute.
    Mr. Clay. Without objection.
    Mr. Cannon. Would the gentlelady yield?
    Mrs. Maloney. I will yield. Yes.
    Mr. Cannon. I thank the gentlelady.
    The gentlelady has really two issues here. One, who is at 
fault for not having funding, and we have a different view of 
that. I think the Congress has some responsibility. But I am 
concerned about your answer, which is essentially that you are 
not going to give us information. That is a bipartisan 
response, I think that I represent, in dealing with that. There 
are very, very limited contexts in which you can withhold 
information. It is not an administration function. It is very, 
very limited to how the President makes his decisions.
    I think you are invoking or you are suggesting that you 
can't answer about your discussions with OMB or with anyone 
other than policymaking in the White House is not appropriate, 
so I am sort of lecturing my colleagues here that we be tougher 
on these kinds of issues, but also suggesting to you that the 
authority of Congress to inquire into these issues is very, 
very broad, and the exemptions are very, very narrow.
    I thank you, and I yield back.
    Mr. Clay. Thank you. And I thank the gentleman.
    The gentleman from New Hampshire is recognized for 5 
minutes.
    Mr. Hodes. Thank you, Mr. Chairman. Thank you for having 
this hearing.
    Mr. Kincannon, I would first simply like to followup on the 
discussion we have just had to make sure I am clear. You said 
that you couldn't talk to us about your discussions with the 
Office of Management and Budget because those were internal 
administration discussions; is that correct?
    Mr. Kincannon. Yes, sir, that is correct.
    Mr. Hodes. And are you claiming some sort of privilege in 
your refusal to answer our questions about the discussions you 
have had with the Office of Management and Budget?
    Mr. Kincannon. If we have to draw a fine line of whether I 
am claiming some sort of privilege, I guess I would have to ask 
for counsel there. But it is a long-established practice, long-
disputed by the Congress on a bipartisan basis, that these 
discussions about budget remain internal to the administration, 
and we, through a set of deliberations, produce a proposal that 
is the President's budget, and we defend that budget.
    Mr. Hodes. Well, sir, you understand our dilemma. Mr. 
Nussle was to come to this hearing. He is the Director of the 
Office of Management and Budget. He is not here. You are, as 
Director of the Census Bureau, right? So in the absence of Mr. 
Nussle, we are trying to get some information about what OMB 
had in mind when they didn't request from Congress in the CR 
the money that you need to do your job. You understand that?
    Mr. Kincannon. Yes, sir.
    Mr. Hodes. I would like you to reconsider right now 
answering our questions about your discussions with OMB. If you 
need counsel, seek that counsel, but I would ask you to 
reconsider, because, although I am a new Member of Congress, 
this is the people's House. This census is very important to 
the United States and the conduct of our elections, and I know 
of no privilege which would allow you not to testify because 
you are under oath about the discussions we have asked so that 
we can get the information we need from OMB. So if there is 
somebody here for you to seek the counsel of, I would ask leave 
from the chairman to give the witness a chance to seek that 
counsel.
    I would ask for a brief delay, Mr. Chairman, so the witness 
can seek the counsel.
    Mr. Clay. I tell you what. We can go to----
    Mrs. Maloney. Would the gentleman yield?
    Mr. Clay. Wait a minute.
    Mrs. Maloney. Would the gentleman yield?
    Mr. Hodes. I will yield.
    Mr. Clay. Wait a minute. We will go to questioning of Mr. 
Wolfe and allow Mr. Kincannon----
    Mrs. Maloney. The gentleman yields. To me, I feel the main 
question is what are we going to do going forward to get this 
census working. That is what I would like to focus on, Mr. 
Chairman, if we could hear what do we do now.
    You just gave me a list of maybe 25 things that are going 
to be delayed or canceled, so basically my question, Mr. 
Chairman: is the $7 million that was transferred last night to 
you going to address this and make it whole? Could he answer 
that one question? Because the main thing is to get this census 
out, have the dress rehearsal, and make it the most accurate 
one we have ever had. That is my question.
    Mr. Kincannon. I agree that is the question, Mrs. Maloney. 
I appreciate that.
    The $6.8 million in the transfer request that was submitted 
to the Appropriations Committees last evening, if we get it by 
Friday, would enable us to shorten the delay in conducting the 
more limited dress rehearsal test of the hand-helds and the 
data integration software. If it is not passed until November 
15th, then it is not going to have any effect at all.
    Mr. Hodes. Reclaiming my time, Mr. Kincannon----
    Mr. Clay. The gentleman is recognized.
    Mr. Hodes. Thank you.
    Mr. Kincannon, so if you get the $7 million, you can go 
forward in a limited way? Is that what you are telling us?
    Mr. Kincannon. We can reduce the delay to less than 2 
months, I am told.
    Mr. Hodes. How much more money do you need to go forward 
fully?
    Mr. Kincannon. The gap between the appropriation a year ago 
for 2007 in this period and the amount of the President's 
budget for this 7-week approximately period is $76 million, and 
by delaying things we have made some funding available, so that 
amount is somewhere between $55 and $76 million.
    Mr. Hodes. And is it fair to say that if you do not have 
that money, whatever it is within the range you have talked 
about, that things will be much more costly down the line?
    Mr. Kincannon. I believe that is reasonable to say, yes, 
because I think we would have to say we don't want to run the 
risk of not testing these devices in a field situation and then 
running around using them with half a million temporary 
employees and running a risk of a failed census. That would not 
serve the country and certainly not the House of 
Representatives well.
    Mr. Hodes. Now, I have heard estimates of perhaps a cost of 
$1 billion if this $55 to $75 million is not provided in a 
timely way to do what you need to do to test the systems and 
conduct the research you need to conduct. Is that a fair 
estimate?
    Mr. Kincannon. I think the fair estimate is between $1.3 
and $1.5 billion at this stage.
    Mr. Hodes. That was a billion with a B?
    Mr. Kincannon. Billion with a B.
    Mr. Hodes. OK. So that if you could send a message directly 
to Congress, it would be: give us the $55 to $75 million as 
soon as possible in order to avoid a much greater expenditure 
down the line?
    Mr. Kincannon. We need the money requested in the 
President's budget, whether that is through a different kind of 
CR, if that is the way the Government is going to be run for 
the rest of the year, or through passing the appropriation for 
the Census Bureau and the rest of the appropriation.
    Mr. Hodes. Thank you. I yield back.
    Mr. Clay. I thank the gentleman.
    Mr. Wolfe, I will direct some questions your way.
    Will the White House request language in the next CR for 
fiscal year 2008 which would grant the Bureau of the Census the 
spending flexibility necessary to stay on time and on track 
with the administration's approved plan for the 2010 census?
    Mr. Wolfe. Mr. Chairman, I have been assured that the 
administration is very seriously considering that, and it is 
looking very good at this point.
    Mr. Clay. Mr. Wolfe, did you or your Department plan on the 
possibility there might not be agreement between Congress and 
the White House on the budget in time to make these important 
expenditures in the beginning of the fiscal year? And how or 
why is there such a crisis in these first 2 weeks of the fiscal 
year if you used recent history as a planning tool? Didn't we 
all see this coming?
    Mr. Wolfe. I think the expectation was, Mr. Chairman, that 
the Congress would pass an appropriation, at least our bill, 
prior to the expiration of the fiscal year. When that did not 
happen, it obviously moved very quickly, and we find ourselves 
in this situation.
    Mr. Clay. And you feel confident that by the time we get to 
November 16th we will have worked out some language with OMB to 
give the Bureau the flexibility?
    Mr. Wolfe. I have every hope, sir, that is the case?
    Mr. Clay. I thank you for that.
    I recognize the gentlelady from New York for five more 
minutes. I yield back my time and recognize you for another 
round of questions.
    Mrs. Maloney. Thank you.
    I tell you first of all, Director Kincannon, I just want to 
express my gratitude on behalf of the American people for your 
many years of service at the census and the fine work that you 
have done. You have been a fine appointee, and I just want to 
thank you very much.
    So if we get the money there in place, you feel that we 
will be able to go forward without the delays and have the 
dress rehearsal and the dress rehearsal will be robust and that 
you will test every final design element you have already 
planned to test?
    Mr. Kincannon. Well, we would not restore the things that 
we have definitely cut. We will not recover a test in dress 
rehearsal of group quarters enumeration. But these doubtful 
things we should be able to remain, and the ones that are still 
unresolved we should be able to----
    Mrs. Maloney. And the new technology with the hand-held 
computer----
    Mr. Kincannon. Yes.
    Mrs. Maloney [continuing]. Which you believe will be more 
efficient, save $1.5 billion, will we be able to go forward 
with the hand-held improvement with the new money that the 
chairman and my colleagues have been talking about, the $1.3 
billion I think you said you needed?
    Mr. Kincannon. Yes, I believe it will.
    Mrs. Maloney. Then we can keep the hand-held?
    Mr. Kincannon. Yes, ma'am.
    Mrs. Maloney. That is terrific.
    How is the American Community Survey doing? Is the response 
as good to that? What is the return on that? It is an ongoing 
program?
    Mr. Kincannon. The response rate, suggested response rate, 
is about 97 percent.
    Mrs. Maloney. That is amazing.
    Mr. Kincannon. It is.
    Mrs. Maloney. That was 97 percent?
    Mr. Kincannon. We are surprised and very pleased.
    Mrs. Maloney. Yes. That is terrific. And many people are 
very concerned about the military bases and the counting of the 
military personnel, particularly in North Carolina and 
California. If we get the money, will the dress rehearsal in 
North Carolina be able to take place on the military bases?
    Mr. Kincannon. It will take place on military bases for 
conventional housing, but not for barracks.
    Mrs. Maloney. Pardon me?
    Mr. Kincannon. Not for group quarters, for the barracks.
    Mrs. Maloney. Not for the group quarters? Why can't we get 
that into this testing?
    Mr. Kincannon. Because we have already stopped certain 
activities in order to direct the----
    Mrs. Maloney. That long list you gave me, you stopped all 
those activities.
    Mr. Kincannon. No. Those are still doubtful. The first list 
I gave you--and I will give you a copy of this for the record.
    Mrs. Maloney. I would like to see it in writing.
    Mr. Kincannon. Yes.
    Mrs. Maloney. There were two lists, one that you might have 
to stop and one that you have definitely stopped.
    Mr. Kincannon. Yes.
    Mrs. Maloney. I think the one you definitely stopped was 
around 15 or 20 things, right?
    Mr. Kincannon. Yes, a number of things. Yes.
    Mrs. Maloney. That is really distressing that lack of good 
planning has resulted in that.
    Mr. Kincannon. We planned what we needed and requested that 
money and it was included in the President's budget. We cannot 
delay it, you know. We have a clock that runs. We have to get 
the dress rehearsal done in time to digest any corrections that 
need to be made and incorporate that in the planning for 2010 
and get that done. We cannot expand that time. There are 
statutory limitations as to how much time we have to do these 
things. It seems like a long way ahead, but if you are waiting 
for an appropriation, you know, who knows how long it will 
take.
    We also were not silent in alerting everybody in town, 
basically, about the need to have this money on time or its 
implications for the dress rehearsal. Now those implications 
have, in a limited extent, unfolded, and we can't recover that. 
We have redirected that funding to the highest priority, which 
is the testing of the hand-held computers and the data 
integration system that will make the results useful and cost 
saving.
    Mrs. Maloney. Now, we have really had a CR in most of the 
12 or 15 years due to budget struggles between either the White 
House or the legislative bodies, the two legislative bodies, 
and when you sit down with your budget folks and start working 
on all of this each year and plan for the budget, don't you, 
because for the last 12 or 15 years, most of which you have 
gotten the exception or the anomaly to go forward outside of 
the frozen CR, don't you have discussions about the possibility 
of a CR and don't you make plans to work around such an 
occurrence?
    Mr. Kincannon. We can't work around a doubling of the 
amount of funding for October and half of November between 2007 
and 2008. We don't have a secret source of money.
    In the case of 2-year money, we have some money that is 2-
year money. If there are unexpended balances at the end of the 
year and we can legitimately obligate that on the next step in 
that program, we do that, but----
    Mrs. Maloney. Usually the CRs have a set line of what they 
are going to pay the agencies.
    Mr. Kincannon. Which is based on----
    Mrs. Maloney. And because of incredibly important 
institutions such as the census, such as the DOD and Homeland 
Security, there are exceptions so that you get the money you 
need to get the job done appropriately. So my question is: in 
the past 12 or 15 years the exception has been written into the 
law that has allowed the Census Bureau to go forward and get 
the job done appropriately. This year it was not, which ended 
up in delays, increased cost, lack of efficiency. My question 
is: in these budget negotiations, when you were talking to the 
appropriate people on both sides of the aisle and everywhere, 
did you raise the need for a changed CR, an anomaly, an 
exception so that you would get the funding that you need?
    Mr. Kincannon. In every year we have raised that concern. I 
don't know that we got an actual anomaly in last year's CR, not 
until after the second seek of February, I think. It was 
requested by the administration but it was not approved by the 
Congress until I guess there was an omnibus bill of some sort 
around February 8th or 9th, and then we received that money.
    Mrs. Maloney. My time has expired.
    Mr. Kincannon. OK.
    Mr. Clay. The gentlelady's time has expired.
    The gentleman from New Hampshire is recognized for 5 
minutes.
    Mr. Hodes. Thank you, Mr. Chairman.
    Mr. Kincannon, you have told us what you have already done 
to cut costs since the signing of the CR, and I understand you 
have two lists, one of items already gone by the boards and 
another list of things that are next on the chopping block; is 
that correct?
    Mr. Kincannon. That remains to be decided, yes.
    Mr. Hodes. Can you tell us what do the cuts that you have 
already made mean for the efficiency, accuracy, and 
effectiveness of the decennial census?
    Mr. Kincannon. Well, I tried to cover that in my testimony. 
The kinds of things that we discontinued, decided that we 
weren't going to do in the dress rehearsal, are processes that 
we have conducted in the past and that we are as confident as 
we can be we can conduct successfully again, like the group 
quarters enumeration. The process is not exactly the same as it 
was in the last census because there is some new automation and 
some slightly changed procedures, but still it is a risk that 
we are willing to run.
    Mr. Hodes. Now let's move to the items that are next on the 
chopping block. Are those in a different category in terms of 
their impact on the census if those are cut?
    Mr. Kincannon. They are, in our view, more important to try 
to do, if at all possible, yes. I can't quantify that for the 
individual items. Some are very small. What day is census day 
going to be? If we have a dress rehearsal there will be a 
census day. That really is not going to----
    Mr. Hodes. Now, I understand that you are planning right 
now to move the North Carolina dress rehearsal out to 
California?
    Mr. Kincannon. Well, we are conducting a dress rehearsal in 
San Joaquin, CA, and in nine counties surrounding Fayetteville, 
NC. We have not decided to cancel at either of those sites.
    Mr. Hodes. If you don't get the funding we have talked 
about, what will happen in terms of your plans for doing both 
San Joaquin and around Fayetteville?
    Mr. Kincannon. We would have to reconsider whether we were 
going to make those further modifications, but we don't have a 
trigger point saying that if we don't get $20 million of that 
we would cut this and cut that. There are a list of things that 
we have to examine depending on the timing of action of the 
Congress and the amount of money that we ultimately get.
    Ultimately, everything, the entire dress rehearsal is on 
the block if we don't get the funding timely.
    Mr. Hodes. Are the rehearsals in San Joaquin and around 
Fayetteville designed particularly to deal with how the census 
is going to count rural communities?
    Mr. Kincannon. Not particularly rural communities, but 
group quarters and particular military bases was a rationale in 
the Fayetteville choice, and also places without city type 
addresses. There are a lot of those. The majority of those I 
believe are in the nine counties surrounding Fayetteville. In 
the San Joaquin test we were interested particularly in 
language minorities. There are also some group quarters issues 
in San Joaquin County. Those were major aspects that we were 
looking at.
    Mr. Hodes. And have you included in the dress rehearsal 
with the current plans, with the current funds you have, 
adequate dress rehearsals for rural communities?
    Mr. Kincannon. I think I said that we have already dropped 
update leave, and that is--I am sorry for the jargon, but it is 
a process whereby, instead of putting the questionnaire in the 
mail to 122 Main Street, the Post Office does not deliver mail 
to the housing unit and we must take the questionnaire and try 
and deliver it to the household, or if they are not at home we 
leave it in a bag on the door handle. That is a phenomenon 
mostly of rural areas, and there are a large number of those 
kinds of addresses in the North Carolina test.
    Mr. Hodes. OK. And did you say that those had already been 
cut?
    Mr. Kincannon. Cut. Yes.
    Mr. Hodes. OK. All right. Is it fair to say that those are 
processes you know about already and have done in previous 
censuses and are well tested and tried?
    Mr. Kincannon. Well, we think so, sir. Yes.
    Mr. Hodes. Thank you.
    Thank you, Mr. Chairman.
    Mr. Clay. I thank the gentleman.
    I will recognize members of the committee for closing 
statements. The gentlelady from New York.
    Mrs. Maloney. First of all I want to thank our two 
witnesses and again thank the Honorable Secretary Kincannon for 
your service. I know that you understand more than most 
Americans how important the census is and how important 
accuracy in the census is for reapportionment, the 
apportionment of representation in both Congress, the State 
legislatures. Absolutely billions of dollars are distributed 
based on census numbers, so it is only fair to fair 
representative government to make it as accurate as possible.
    I would just like to say that we have a difference of 
opinion in how much information can be shared with us. We want 
to explore that issue further, but, just as important, we need 
to figure out how to fix this and move forward, correct as many 
mistakes as we can, fund it to the proper level.
    I would say we need to figure out how to communicate 
better. You need to tell us what your challenges are. You need 
to tell us when you are not getting the proper funding. We need 
to be able to correct this going forward. I disagree that, as 
my colleagues have so stated, that this information is 
privileged conversation. It is not. But the main thing is we 
have to get this funded. We have to get it right. We have to 
correct as much as we can, get those dress rehearsals done, and 
move forward in a positive way.
    I yield back.
    Mr. Clay. I thank the gentlelady for her statement.
    Mr. Hodes.
    Mr. Hodes. Thank you, Mr. Chairman.
    I thank both witnesses for being here today. Obviously, an 
accurate population count is very serious business. The 
Constitution mandates it. We use the population counts as the 
basis for our voting system, our congressional districts, our 
Electoral College, and really, I think, this is a completely 
nonpartisan issue. There is no excuse for not addressing the 
budgetary problems quickly. We cannot risk disenfranchising 
voters, especially in harder-to-count communities, like in the 
military communities, in rural communities, and other places. I 
am sorry to hear that various things have already been dropped 
that ought to be tested as things progress.
    I will just say, Mr. Kincannon, I know you have served a 
long time and this is probably your last congressional 
appearance, so congratulations to you. As far as putting you on 
the spot, I will say that there is a larger issue in terms of 
the relationship between an administration which has not been 
forthcoming, in my judgment, with Congress about all kinds of 
information, and Congress' role as the people's voice in this 
Government. We need accurate information, and we need to know 
what people have said in order to do what we need to do to do 
our work. I appreciate where you are and I hope you understand 
that my questions are not personal but professional about that 
relationship which will be carried on in other places.
    But I think we are taking from this hearing certainly it is 
my sense that we in Congress need to do whatever is necessary 
and as quickly as possible to give you the tools to make sure 
that the census goes forward in its best form possible. I will 
certainly do whatever I can to make that happen.
    Thank you both for your appearance here today.
    Mr. Clay. I thank the gentleman for his closing statement.
    Mr. Wolfe, I want to thank you for your appearance today. 
You have certainly raised our level of comfort to hear that the 
Department will be working with OMB to come up with a funding 
solution for the Census Bureau.
    Mr. Wolfe. Absolutely, sir.
    Mr. Clay. We appreciate that.
    Also, I want to say that it is the hope of this committee 
that nothing in the CR language will hinder, delay, or deny the 
plan, funding, and execution of the contracts for the hand-held 
computers, the advertising program, the partnership program, or 
the data capture program, and that this administration will use 
every means necessary to grant the Bureau of the Census 
officials any waivers or exemptions from administration 
spending restrictions in order for them to meet those 
requirements and to run an adequate dress rehearsal.
    Mr. Kincannon, would you please provide this committee with 
those lists of cancellations or changes or possible 
cancellation that you rattled off to us earlier? We would 
appreciate that.
    We pray, Mr. Kincannon, that this is your last appearance 
before this committee, but it has certainly been a pleasure to 
have you as a witness, and we certainly appreciate your service 
to this country.
    The panel is dismissed.
    This hearing is adjourned. Thank you all.
    [Whereupon, at 11:20 a.m., the subcommittee was adjourned.]

                                 
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