[Senate Hearing 111-]
[From the U.S. Government Publishing Office]


 
         LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 2010 

                              ----------                              


                         THURSDAY, MAY 21, 2009

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:30 p.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Ben Nelson (chairman) presiding.
    Present: Senators Nelson and Murkowski.

                    GOVERNMENT ACCOUNTABILITY OFFICE

STATEMENT OF GENE L. DODARO, ACTING COMPTROLLER GENERAL

                OPENING STATEMENT OF SENATOR BEN NELSON

    Senator Nelson. The subcommittee will come to order.
    Good afternoon to everybody, and welcome. We meet this 
afternoon to take testimony on the fiscal year 2010 budget 
request for the Government Accountability Office (GAO), the 
Government Printing Office (GPO), and the Congressional Budget 
Office (CBO). We will welcome our ranking member just as soon 
as she is able to be here.
    And I want to welcome our witnesses today--Gene Dodaro, 
Acting Comptroller General; Robert Tapella, Public Printer; and 
Doug Elmendorf, Director of the Congressional Budget Office. It 
is good to have you all here, together with staff, and we look 
forward to your remarks.
    If it is possible to hold those opening statements brief, 
maybe around 5 minutes, and submit the rest of your testimony 
for the record, which we will receive, I think we will be able 
to ask more questions as a result of that.
    One thing that we have established at the first two 
hearings of this subcommittee, and I think it bears repeating, 
is that we are not eager to increase the overall legislative 
branch budget this year. We are looking for your guidance in 
helping us to address your agencies' needs in fiscal year 2010, 
but this really isn't the year for extras.
    The subcommittee received an 11 percent increase in fiscal 
year 2009, but I seriously doubt that we are going to see 
anything near a double-digit increase this year. You can almost 
bet the opposite.
    First, Mr. Dodaro, I want to thank you for your service to 
our country as the Acting Comptroller General of the GAO. I 
think you have done an outstanding job in this role over the 
last year. And according to yesterday's Washington Post, GAO 
ranked among the best Federal Government agencies to work for 
in a survey conducted by the Partnership for Public Service.
    Congratulations on a wonderful piece outlining what a 
terrific place it is to work. And I wish you and your 
colleagues continued success and the continued great 
relationship.
    I especially appreciate the efforts of your agency in 
assisting Congress during our country's current economic crisis 
and your oversight of both the Troubled Asset Relief Act and 
the American Recovery and Reinvestment Act. And of course, I 
look forward to discussing your latest findings on these 
activities as well as your fiscal year 2010 budget, which shows 
an increase of 7 percent over fiscal year 2009 and includes 109 
additional full-time equivalents (FTEs).
    I also want to welcome Bob Tapella from the Government 
Printing Office. Your budget total is $166 million, an 18 
percent increase over the current year, which I understand 
includes large increases for both building repairs and 
technology upgrades.
    And finally, I want to welcome Doug Elmendorf, Director of 
the Congressional Budget Office. Congratulations on your recent 
appointment to this position, and your fiscal year 2010 budget 
total is $46.3 million, an increase of 5.2 percent and 12 
additional FTEs.
    And now, it is my pleasure to turn to my ranking member, 
Senator Murkowski, for your opening remarks. And let me say it 
has been a pleasure working with you. This is a subcommittee 
that shows and knows no partisanship, and we want to continue 
to be able to work that way.

                  STATEMENT OF SENATOR LISA MURKOWSKI

    Senator Murkowski. Well, thank you, Mr. Chairman. I 
appreciate your kind remarks.
    I want to welcome the gentlemen before us today, and thank 
you all for your work in your respective areas.
    As you have mentioned, Mr. Chairman, you have talked a 
little bit about the realities of the budget that we are facing 
and our efforts to try to be perhaps a little more lean and 
mean. I don't like the mean part, but nothing wrong with a 
little leanness here.
    And recognizing that the jobs that are requested are 
difficult, and we have a tendency to complicate probably your 
lives often times with the requests that come from Members 
here. But in order for us to do our jobs, of course, we rely on 
you and what you provide, and we appreciate that.
    As you have mentioned, Mr. Chairman, the agencies before us 
today are requesting a combined total of $780 million for 
fiscal year 2010. This is an increase of $64 million, or 9 
percent over last year. Each agency is requesting additional 
staffing on top of the usual cost-of-living increases, and for 
the Government Printing Office, significant increases are 
requested for investments in information technology and systems 
development, as well as repairs to GPO's buildings.
    I do recognize, fully recognize that these three agencies 
perform very important functions, serve the entire Federal 
Government, not just the legislative branch. And it is 
important to keep that in perspective. I do look forward to 
understanding fully the needs of each agency, but I would agree 
with you, Mr. Chairman, that I am skeptical about the need for 
large increases for the legislative branch.
    With respect to the Government Accountability Office, I 
would like to note that GAO has traditionally performed a very 
important role for this subcommittee in its oversight of its 
sister agencies. GAO has done extensive work over the past 
decade in reviewing management and organizational issues at the 
Capitol Police, at the Architect of the Capitol, as well as the 
Library of Congress. And this work has been invaluable, 
particularly to this subcommittee, as we attempt to promote the 
improvements in each of these agencies, and I would certainly 
hope that that would continue.
    Staff discussions have been underway in recent weeks 
regarding the Capitol Police overtime and their staffing 
issues, and I would hope that GAO would place a high priority 
on this work as we wrestle with the need for Capitol Police 
staffing requirements.
    There have also been discussions in the past year on the 
Architect of the Capitol's prioritization of its construction 
work, with particular emphasis on the impact of the Office of 
Compliance citations. We had a very interesting hearing on that 
a couple of weeks ago. We will need to continue to have GAO's 
assistance to ensure that we allocate funds to these projects 
so that we truly do get the most bang for the buck. So we 
appreciate that.
    Again, appreciate the good work that is done and want you 
all to know that we value the important work that you do, look 
forward to your comments here this afternoon.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you.
    Now we will proceed, first, to Mr. Dodaro, who will be 
followed by Mr. Tapella, and last, but not least, Dr. 
Elmendorf.
    Mr. Dodaro.

                  SUMMARY STATEMENT OF GENE L. DODARO

    Mr. Dodaro. Thank you very much Mr. Chairman, Senator 
Murkowski. It is a pleasure to appear before you this afternoon 
to discuss our 2010 budget request.
    First, Mr. Chairman, I want to thank you for your kind 
words and the recognition of GAO as the number two best place 
to work in the Federal Government. We are very proud of that, 
and making GAO a good place to work helps us serve the Congress 
better. So we are very committed to doing both.
    And Senator Murkowski, among the work that we consider to 
be a high priority is our work that supports the legislative 
branch and its important activities. So I can assure you that 
we will continue to give that work high priority.
    I would like to thank the Congress and the subcommittee for 
the support that we had received in 2009. That has helped us be 
in a good position to help support the Congress. Our 2010 
request is intended to help ensure that we are in the best 
position possible to help all the committees throughout the 
Congress tackle very important national issues, as well as some 
difficult challenges.

                GAO deg.SUMMARY OF GAO WORKLOAD

    We support every standing committee in the Congress and 
about 80 percent of the subcommittees. Now among the difficult 
challenges, as you mentioned, Mr. Chairman, is the work that we 
are doing to help in the financial markets and with the 
economic downturn. In addition to providing reports every 60 
days on the implementation of the Troubled Asset Relief 
Program, we are also the auditors, as of last year, of the 
Federal Housing Finance Administration, which is now the 
conservator and the regulator for Fannie Mae and Freddie Mac.
    And we are also working on proposals to help the Congress 
make decisions on how those entities ought to go forward once 
they come out of conservatorship status. We are also the 
auditors of the Bank Insurance Fund, and of course, they have 
had a lot of difficult challenges, some of the most difficult 
since the savings and loan crisis in the 1980s and 1990s.
    We have also done work on the need to modernize our 
outdated and fragmented regulatory system. We added that on the 
high-risk list for Congress so that it receives congressional 
attention. We have issued reports. It is very important for us 
to continue to help the Congress modernize the financial 
regulatory system so we address the root causes of how we got 
into this situation in the first place and make sure it doesn't 
happen again.
    Part of our request for additional resources is directed 
toward helping us bolster our capability to help Congress 
decide what system should be put in place, but also that it 
works effectively and that there is adequate monitoring going 
forward. So, that is a very important role for us.
    Also, on the American Recovery and Reinvestment Act, we 
have a range of responsibilities that the Congress has assigned 
to us, including bimonthly reviews of the use of the funds by 
selected States and localities. We have picked 16 States and 
the District of Columbia, which will receive over two-thirds of 
the funds being provided to State and local governments. We 
will be doing a longitudinal study over the next 2 or 3 years, 
as the Recovery Act funds are distributed to the States and 
localities, to assess how they use the money and whether or not 
the act is achieving its objectives over time.
    Our request is also intended to support a wide range of 
other issues, ranging from the U.S. efforts in Iraq, 
Afghanistan, and Pakistan to the 2010 census to healthcare 
issues to energy issues and across the full breadth of the 
Federal Government's activities going forward.

                GAO deg.SUMMARY OF GAO REQUEST

    As you mentioned, Mr. Chairman, we are asking for a 6.9 
percent increase. This would allow us to increase our staffing 
by 109 FTEs, or 3.5 percent, in order to help respond to the 
estimated 1,200 requests that we receive from the Congress 
every year. The Congress was very kind to us last year. We were 
able to increase our staffing a bit, but we are still near the 
lowest level we have ever been in GAO's history at a time where 
our services are being required more and more.

                           PREPARED STATEMENT

    We believe our request is a prudent one. We have carefully 
thought about it. I understand perfectly the situation that you 
are in. I know you will give careful attention to our request. 
I appreciate that very much, and I look forward to responding 
to any questions that you may have.
    [The statement follows:]
                  Prepared Statement of Gene L. Dodaro
    Mr. Chairman, Ranking Member Senator Murkowski, and Members of the 
Subcommittee, I appreciate the opportunity to be here today to discuss 
the U.S. Government Accountability Office's (GAO) budget request for 
fiscal year 2010. At the outset, I want to thank the subcommittee for 
its support of GAO. We appreciated your efforts in appropriating a 
fiscal year 2009 amount that provides GAO with the resources to better 
allow us to assist the Congress in a timely way to address the many 
difficult challenges facing the Nation. I also want to acknowledge the 
professionalism, talents, and dedication of our GAO workforce in 
supporting the Congress and improving government for the American 
people.
    In fiscal year 2008, GAO delivered advice and analyses to the 
Congress in response to requests from all of the standing committees of 
the House and the Senate, as well as over 80 percent of their 
subcommittees. The hard work of our staff yielded significant results 
across the government, including expert testimony at over 300 
congressional hearings, hundreds of improvements in government 
operations, and billions in financial benefits.
    I submit for your consideration a request for a fiscal year 2010 
appropriation of $567.5 million to support 3,250 full-time equivalent 
(FTE) staff. This request represents an increase of $36.5 million, or 
6.9 percent, over our fiscal year 2009 funding level, which would 
support a 3.5 percent increase over our 2009 FTE level. Importantly, 
almost 70 percent of our requested increase is needed for mandatory pay 
and uncontrollable cost increases. While our fiscal year 2009 funding 
level allows us to make progress in responding to new congressional 
requests sooner, our fiscal year 2010 request would enable GAO to make 
greater progress in addressing the issues of greatest interest to the 
Congress and the American public during these challenging times, which 
is our highest priority. I am also requesting authority to use $15.2 
million in offsetting collections, as detailed in our budget 
submission.
    gao delivers results on an increasing range of federal programs
    The Congress continues to rely on GAO's nonpartisan, objective 
analysis and recommendations and has given us new responsibilities and 
opportunities to play key roles in addressing a number of emerging 
issues. We are addressing challenges in the financial markets and 
broader economy through our work overseeing the Troubled Asset Relief 
Program (TARP), created in 2008. We continue to monitor and report, 
every 60 days, on the status of the implementation of TARP, and we plan 
to conduct an annual financial audit of the $700 billion authorized for 
the program.
    Additionally, GAO is carrying out a range of responsibilities 
overseeing spending related to the 2009 American Recovery and 
Reinvestment Act (ARRA)--including bimonthly reviews of how selected 
States and localities across the country are using the billions of 
dollars of funds provided to them--and providing targeted studies in 
several areas, such as small business lending, education, and expanded 
trade adjustment assistance.
    Over the next several years, our work will encompass critical 
areas, including
  --reviewing progress in implementing key activities for the 2010 
        Census;
  --helping to support the Congress's consideration of changes in the 
        regulatory structure for financial markets and institutions, 
        including the establishment and implementation of controls to 
        help avoid a future financial crisis of the magnitude the 
        Nation faces today;
  --reviewing the revised governance structure for the housing market 
        and providing targeted analyses to inform decision makers 
        working to restore the functioning of the mortgage market and 
        resolve the ultimate disposition of Fannie Mae and Freddie Mac;
  --supporting health care reform efforts and control of health care 
        costs through analysis of expenditures and payment structures 
        in Medicare, Medicaid, the State Children's Health Insurance 
        Program, and other health programs;
  --reviewing the impact of drawing down our resources in Iraq, 
        providing more resources in Afghanistan, and retooling our 
        operations in Pakistan;
  --providing balanced and objective assessments of the use of emerging 
        technologies in the context of Federal programs and public 
        policy issues, such as green energy, energy efficiency, health 
        information technology, homeland security technologies, climate 
        change, science and math education programs, as well as the 
        technical challenges of developing sophisticated space and 
        defense systems;
  --reviewing initiatives to enhance protection of cyber assets;
  --assessing contractor management, sourcing strategies, and 
        contracting reforms; and
  --helping the Congress tackle both new and continuing high-risk 
        areas, such as protecting public health through enhanced 
        oversight over medical products, food safety, and toxic 
        chemicals.
    Finally, as part of fulfilling our commitments under the 
Presidential Transition Act, as amended, GAO is serving as a key 
resource for the Congress and the administration on major challenges 
needing the attention of the 28 largest departments and agencies across 
government, as well as 13 other issues facing our Nation that require 
urgent attention and continuing oversight. In addition to those already 
mentioned, these include
  --preparing for public health emergencies,
  --improving the U.S. image abroad,
  --protecting the homeland,
  --caring for service members, and
  --defense spending and readiness.
    Our work receives great interest not only from the Congress but 
from the American people. For example, while our reports routinely 
receive media and public interest, in the first half of fiscal year 
2009, 12 GAO reports were downloaded over 10,000 times each from our 
external Web site, www.gao.gov. These reports covered an array of 
important issues, including
  --veterans' health care and the challenges of recruiting and 
        retaining inpatient nurses,
  --Medicaid outpatient drug reimbursements and comparisons with retail 
        pharmacy acquisition costs,
  --private equity and the risk of leveraged buyouts,
  --the outdated financial regulatory system and the need for a 
        modernized framework, and
  --defense logistics and the need for better analyses and cost data to 
        support performance-based decisions.
    In addition to our work in response to congressional requests, GAO 
also issues products that provide agencies with guidance and best 
practices, or that otherwise support greater accountability and 
oversight in government. In the first half of fiscal year 2009, 13 of 
these products were downloaded over 10,000 times each from our external 
Web site. The top five picks were (1) special publications on the 
principles of appropriations law, (2) the 2009 high-risk update, (3) 
updated guidance on government auditing standards, (4) the GAO cost 
estimating and assessment guide, and (5) highlights of our May 2007 
health care forum focusing on steps needed to meet future challenges.
    I am pleased by the recognition GAO receives from ordinary 
Americans and civil servants alike as a continuing source of reliable, 
unbiased information about how government operations can be improved.
               high congressional demand for gao services
    GAO is an invaluable resource for helping the Congress provide 
oversight, accountability, and transparency in government. The demand 
for GAO services continues to remain high as a direct result of the 
high quality of our work, and this high demand is an indication of the 
Congress's desire for timely and objective analyses and professional 
advice. In each of fiscal years 2007 and 2008, GAO received over 1,200 
requests and mandates. The number of congressional mandates, our 
highest-priority work, more than doubled from fiscal year 2007 to 2008. 
In addition, as evidenced above, our work covers more and more complex 
issues across a broad range of Federal programs, requiring more in-
depth analysis to complete.
    This congressional demand for GAO studies also has affected our 
ability to respond promptly to congressional requests. For instance, in 
fiscal year 2008, GAO delayed starting work on 21 percent of our 
accepted requests due to staff unavailability. The average time we took 
to initiate congressionally requested engagements was almost 5 months 
in the first half of 2009, compared with less than 3 months in fiscal 
year 2005.
    In addition, GAO is providing testimony at an increased number of 
congressional hearings. We testified at 304 hearings in fiscal year 
2008. This was the second highest number for GAO in the last 25 years.
    We expect to continue receiving a high volume of requests related 
to either the Nation's new challenges, such as the recent developments 
in the financial markets and economy, or to the many emerging 
initiatives of the Congress and the administration. Moreover, all 
Senate committees are required to review programs within their 
jurisdiction to root out fraud, waste, and abuse in program spending--
giving particular scrutiny to issues raised in GAO reports--and develop 
recommendations for improved government performance. Also, recent 
changes to House rules require each standing committee or subcommittee 
to hold at least one hearing on any issue raised by GAO that indicates 
that Federal programs or operations authorized by that committee or 
subcommittee are at high risk for fraud, waste, abuse, or 
mismanagement.
    Our January 2009 issuance of the biennial, High-Risk Series: An 
Update, which identifies Federal areas and programs at risk of fraud, 
waste, abuse, and mismanagement, as well as those in need of broad-
based transformations, identified 30 at-risk Federal programs. Issued 
to coincide with the start of each new Congress, our high-risk updates 
have continued to help to focus and sustain attention to these programs 
so that executive branch officials who are accountable for each 
program's performance, as well as members of the Congress, have the 
information needed to complete their oversight responsibilities. The 
high-risk update report is available on our Web site at http://
www.gao.gov.
                 gao's fiscal year 2010 budget request
    With the increased capacity included in our fiscal year 2010 
appropriation request, we can continue to assist the Congress with 
oversight over a broad range of Federal programs. As a knowledge-based 
organization, about 80 percent of GAO's budget funds staff compensation 
and benefits, with much of the balance of our budget funding mandatory 
operating expenses, such as security services and other critical 
infrastructure services necessary to support our ongoing operations. 
For this reason, a significant portion of our requested funding 
increase is not discretionary.
    Our requested increase for fiscal year 2010 of $36.5 million seeks 
funds to cover
  --mandatory pay increases resulting primarily from annual across-the-
        board and performance-based increases, as well as pay raises 
        required by the GAO Act, including the annualization of prior 
        fiscal year compensation costs;
  --uncontrollable inflationary increases imposed by vendors as part of 
        the cost of doing business;
  --nonrecurring fiscal year 2009 costs resulting from program 
        improvements, which can offset about one-third of our mandatory 
        and inflationary changes;
  --strengthening our staff capacity to provide timely support to the 
        Congress in confronting the broad array of critical challenges 
        facing the Nation, including
    --helping to support the Congress's consideration of changes in the 
            regulatory structure of financial markets and institutions,
    --providing targeted analyses to inform decision makers working to 
            restore the functioning of the mortgage market,
    --supporting health care reform efforts and the control of health 
            care costs, and
    --providing assessments of technologies in the context of Federal 
            programs and public policy issues, and
  --program changes supporting critical investments to (1) provide 
        employee development and benefits, (2) implement technological 
        improvements, and (3) strengthen our infrastructure.

                             TABLE 1.--FISCAL YEAR 2010 SUMMARY OF REQUESTED CHANGES
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                                                                                    Cumulative
                                                                                                   percentage of
                                                                                                   change fiscal
                        Budget category                               FTEs            Amount       year 2009 to
                                                                                                    fiscal year
                                                                                                       2010
----------------------------------------------------------------------------------------------------------------
Fiscal year 2008 actual........................................           3,081        $498,548   ..............
Fiscal year 2009 revised estimate..............................           3,141         531,000   ..............
Fiscal year 2010 requested changes.............................  ..............  ...............  ..............
    Mandatory pay..............................................  ..............          19,475              3.7
    Inflationary cost increases................................  ..............           5,714              4.7
    Nonrecurring fiscal year 2009 costs........................  ..............          (8,338)             3.2
    Staff capacity.............................................             109          16,826              6.3
    Program changes............................................  ..............          10,407              8.3
    Increase in offsetting collections.........................  ..............          (7,587)             6.9
                                                                ------------------------------------------------
      Subtotal--requested changes..............................             109          36,497   ..............
                                                                ================================================
Appropriation..................................................           3,250         567,497              6.9
----------------------------------------------------------------------------------------------------------------
Source: GAO.

                           concluding remarks
    I believe that you will find our budget request well-justified as 
it will ensure that GAO has the necessary staff and resources to 
strengthen our capacity to provide timely assistance to the Congress to 
confront the difficult challenges facing the Nation and help improve 
government for the American people.
    With your support of our 2010 budget request, we will continue 
rewarding the confidence you place in us by maintaining a strong return 
on this appropriation investment as we help to improve services to the 
public, change laws, and improve government operations.
    We are grateful for the Congress's continued support of our efforts 
to help improve government performance, accountability, and 
transparency. GAO remains committed to providing accurate, objective, 
nonpartisan, and constructive information to the Congress to help 
conduct effective oversight and fulfill its constitutional 
responsibilities.
    Mr. Chairman and Ranking Member Senator Murkowski, this concludes 
my prepared statement. I would be pleased to respond to any questions 
that you or other Members of the subcommittee might have.

                       GOVERNMENT PRINTING OFFICE

STATEMENT OF ROBERT C. TAPELLA, PUBLIC PRINTER
    Mr. Tapella. Mr. Chairman, Senator Murkowski, thank you for 
inviting me today to discuss GPO's appropriation for fiscal 
year 2010. And I will take your advice and speak very briefly.
    First, I would like to express my deep appreciation to the 
subcommittee for the support we received for GPO's fiscal year 
2009 appropriations request. More specifically, I would like to 
commend your staff, Nancy Olkewicz and Carrie Apostolou, for 
the time they took to really understand GPO's needs. They asked 
a lot of tough questions, but at the end of the day, they 
really helped us to move forward.
    The fiscal year 2009 funding eliminates the shortfall in 
congressional printing and binding, allows us to undertake a 
number of valuable projects supporting electronic information 
dissemination to depository libraries and other users, brings 
FDsys closer to completion, repairs our roof, and begins to 
renovate our elevators.
    Second, now that the shortfall has been repaid, for fiscal 
year 2010 we are able to request a reduction in appropriations 
for congressional printing and binding of approximately $3.5 
million. For the salaries and expenses of the Superintendent of 
Documents, we are seeking a modest increase of $2.2 million to 
continue transforming the program to a predominantly electronic 
basis.
    For our revolving fund, we are seeking an increase of $18.5 
million to complete the development of FDsys and to carry out a 
number of critically important information technology (IT) 
infrastructure projects. We are also seeking $13.6 million for 
necessary building maintenance and repairs. I understand there 
will be limitations on what the subcommittee can recommend for 
us, and so I am happy to discuss our priorities.
    Finally, like many other agencies and many businesses these 
days, GPO is facing a very different business climate this 
year, in our case as a direct result of the significant 
reduction in demand for passports from the Department of State. 
We are tightening our belt, evaluating all costs and proposed 
projects, and taking all available measures to ensure we stay 
within our budget.
    I won't kid you. This is going to be a tough year for us. 
With your understanding and support, our objective is to 
complete the year on a sound financial basis.

                           PREPARED STATEMENT

    Mr. Chairman, Senator Murkowski, this concludes my remarks, 
and I am happy to answer any questions you may have.
    [The statement follows:]
                Prepared Statement of Robert C. Tapella
    Chairman Nelson, Senator Murkowski, and Members of the Subcommittee 
on Legislative Branch Appropriations, it is an honor to be here today 
to discuss the appropriations request of the Government Printing Office 
(GPO) for fiscal year 2010.
                      results of fiscal year 2008
    Building on our continuing transformation, GPO recorded another 
year of positive performance in fiscal year 2008. Much of this was 
attributable to the production of passports. The State Department's 
requirement for these documents grew significantly during the year, 
rising by nearly a third--from an estimated 18 million to approximately 
24 million--by year's end. By mid-year fiscal year 2009, however, 
passport production had decreased significantly due to reduced demand 
from the State Department.
    GPO's support for Congress during fiscal year 2008 was highlighted 
by work on products required for the Joint Congressional Committee on 
Inaugural Ceremonies, including invitations, maps, signs, programs, 
tickets, and other products, most notably secure credentials for law 
enforcement personnel associated with this event. During the year GPO 
also began producing the new edition of the U.S. Code, and delivered a 
number of other important congressional products, including Black 
Americans in Congress, 1807-2007. For Federal agencies, GPO began 
procuring work to support the upcoming 2010 Census, built its smart 
card business to help support State Department and Homeland Security 
travel documents, and with the Office of Management and Budget GPO 
coordinated the electronic delivery to Congress of the official version 
of the Budget of the United States Government for fiscal year 2009, 
which we authenticated by digital signature.
    GPO's electronic transition efforts proceeded apace as we readied 
our Federal Digital System (FDsys) for its first public release, which 
occurred in January 2009. This system will replace and improve on the 
services of GPO Access, which has provided the public with online 
access to Government information since 1994; funding for FDsys 
operating costs in the future will be derived from the appropriated 
funding sources currently supporting GPO Access. FDsys will also serve 
as GPO's digital platform, with a planned capability to provide for the 
intake, storage, processing, and output of Government publication 
content in a variety of forms and formats. With a state-of-the-art 
search and retrieval capability, FDsys is uniquely positioned to 
support the new Administration's commitment to providing greater 
openness and transparency in Government information. During the year 
GPO also expanded its authentication capabilities. In addition to the 
Budget, GPO completed work on authenticating selected congressional 
bills for the 110th Congress and is extending this capability to all 
bills in the 111th Congress.
    Over the past several years, GPO has implemented a variety of green 
initiatives in its operations: for more than a decade, for example, 
printing papers used by GPO have met the requirements for recycled 
content contained in the Resource Conservation and Recovery Act of 
1989, as amended, and corresponding Executive Orders. The printing inks 
used by GPO and its contractors comply with the requirements of the 
Vegetable Ink Printing Act of 1994. GPO works with the Environmental 
Protection Agency and the District of Columbia to meet the standards 
for emissions of volatile organic compounds established by the Clean 
Air Act.
    However, there is more that GPO can do in this field, and during 
fiscal year 2008 sustainable environmental stewardship was the focus of 
a concentrated effort at GPO. In my view, the future of sustainable 
environmental stewardship means being proactive and making changes so 
that GPO becomes a more efficient operation that makes better use of 
the resources under our control. During fiscal year 2008, we 
articulated a vision for the entire lifecycle of what GPO produces, 
from how we source the raw materials to how we produce our products, to 
what happens to the products when consumers are done with them.
    For GPO, this means a variety initiatives, including development of 
a plan for moving from web offset presses to digital equipment to 
reduce paper consumption; accelerating the re-engineering of business 
processes in production, procurement, documents dissemination, and 
administration to take advantage of the efficiencies offered by digital 
technology; conducting energy audits throughout our facilities to 
reduce our energy demand; using more environmentally responsible paper; 
reducing hazardous waste through solvent recovery systems, and reducing 
the total amount of waste generated by our operations; and installing a 
``green'' roof on our building, in targeted areas, to double the life 
expectancy of the roof and reduce heating demands in the building. 
During fiscal year 2008, GPO made significant progress in these fields 
and laid the groundwork for continued sustainability improvements in 
the coming year.
                fiscal year 2010 appropriations request
    For fiscal year 2010, we are requesting a total of $166,307,000, to 
enable us to:
  --Meet projected requirements for GPO's congressional printing and 
        binding and information dissemination operations during fiscal 
        year 2010;
  --Provide investment funds for necessary information dissemination 
        projects in the Federal Depository Library Program;
  --Complete the development of FDsys and implement other improvements 
        to GPO's information technology infrastructure; and
  --Perform essential maintenance and repairs on GPO's buildings.

                   CONGRESSIONAL PRINTING AND BINDING
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Fiscal year 2009 Approved..............................     $96,828,000
Fiscal year 2010 Request...............................      93,296,000
Change.................................................      (3,532,000)
Change includes:
    Price level changes................................       2,362,000
    Volume changes.....................................       3,273,000
    Elimination of shortfall...........................      (9,167,000)
------------------------------------------------------------------------

    We are requesting $93,296,000 for this account, representing a 
decrease of $3,532,000 from the level approved for fiscal year 2009.
    Funding for fiscal year 2010 congressional printing and binding 
requirements includes price level changes averaging 2.7 percent that 
are attributable primarily to existing wage contracts, as well as 
estimated volume changes in certain workload categories based on 
historical data. GPO projects an increased volume for the daily 
Congressional Record, business and committee calendars, miscellaneous 
printing and binding, hearings, document envelopes and document franks, 
and Congressional Record indexers. These workload increases will be 
offset by reductions in volume for committee prints, miscellaneous 
publications, bills, resolutions, and amendments, committee reports, 
and other workload categories. The funding provided for fiscal year 
2009 eliminated the shortfall in this appropriation that was 
accumulated in fiscal year 2007 and fiscal year 2008.

        SALARIES AND EXPENSES OF THE SUPERINTENDENT OF DOCUMENTS
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Fiscal year 2009 Approved...............................     $38,744,000
Fiscal year 2010 Request................................      40,911,000
Change..................................................       2,167,000
Change includes:
    Mandatory Requirements..............................       1,094,000
    Investment Requirements.............................       1,073,000
------------------------------------------------------------------------

    We are requesting $40,911,000 for this account, representing an 
increase of $2,167,000 over the level approved for fiscal year 2009. 
The increase is to cover mandatory pay and price level changes, and to 
continue improving public access to Government information in 
electronic formats by implementing a series of projects and hiring 
additional program specialists.
    As GPO continues to perform information dissemination through the 
Federal Depository Library Program (FDLP) on a predominately electronic 
basis, as mandated by the conference report accompanying the 
Legislative Branch Appropriations Act for Fiscal Year 1996, we need to 
make continuing investments in this program's technology infrastructure 
and supporting systems. Included in our request for fiscal year 2010 is 
funding to cover additional data storage, the migration of legacy 
applications to updated service functions, miscellaneous materials for 
digitization projects, survey and data analysis, legacy application 
integration for the FDLP desktop, and hiring 10 additional full-time 
equivalents to perform acquisitions, classification, cataloging and 
indexing, and related requirements.

                             REVOLVING FUND
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Fiscal year 2009 Approved...............................      $4,995,000
Fiscal year 2010 Request................................      32,100,000
Change..................................................      27,105,000
Change includes:
    Investments in information technology infrastructure      18,500,000
     and systems development............................
    Building maintenance and repairs....................      13,600,000
------------------------------------------------------------------------

    We are requesting $32,100,000 for this account, to remain available 
until expended, to fund essential investments in information technology 
infrastructure and systems development, as well as needed maintenance 
and repairs to GPO's buildings.
    Our request includes $18,500,000 for investments in information 
technology infrastructure and systems development. The key projects 
covered under this heading are $8 million to complete the development 
of FDsys; $9.5 million to replace GPO's automated composition system, 
implement an automated manufacturing workflow system, continue 
implementing GPO's Oracle business systems, and fund related projects; 
and $1 million for continuity-of-operations (COOP) improvements to 
GPO's presence at the legislative branch alternate computing facility.
    The balance of our request is $13,600,000 for necessary repairs and 
maintenance to GPO's buildings, including continuing elevator 
replacement and renovation, window replacement for energy conservation, 
and related projects. Our request includes $1.7 million for various 
green and environmental initiatives. The funding provided for fiscal 
year 2009 will pay for a new roof as well as contribute to elevator 
repairs and FDsys development.
    Chairman Nelson, Senator Murkowski, and Members of the 
Subcommittee, we look forward to working with you, and with your 
support we can continue GPO's record of achievement. This concludes my 
prepared statement, and I would be pleased to answer any questions the 
Subcommittee may have.

                      CONGRESSIONAL BUDGET OFFICE

STATEMENT OF DOUGLAS W. ELMENDORF, DIRECTOR
    Dr. Elmendorf. Thank you, Chairman Nelson, Senator 
Murkowski. I appreciate the opportunity to testify today about 
the CBO's budget request for fiscal year 2010.
    As you know, I became CBO Director just 4 months ago. I am 
honored to have been appointed to that position and to be 
making the case today for CBO's proposed budget. As you said, 
Mr. Chairman, our total request is about $46 million, which is 
a $2 million, or 5.2 percent increase over funding for the 
current year.

                        CBO deg.MISSION

    Since CBO's launch in 1975, our mission has been to provide 
Members of Congress and their staffs with the information you 
need to make effective budget and economic policy. We are 
committed to providing information that is objective, 
insightful, timely, and clearly presented and explained.

                         CBO deg.STAFF

    In providing this information, CBO's most important asset 
has always been its staff. We have about 240 people, mostly 
with Ph.D.s in economics or master's degrees in public policy. 
And I can't resist noting that in the competition for good 
places to work, among the small agency category in which CBO 
competes--not with our friends and colleagues at GAO, but in 
the small agency category--CBO was tied for third place among 
Federal agencies.
    And that is important, as Gene Dodaro noted, it helps us to 
serve you. It helps us to attract the best people and to create 
an environment in which the people are doing their best work.

                    CBO deg.PHASED INCREASE

    CBO has operated with about 235 people for the past decade, 
has increased only a little in size since its founding more 
than 30 years ago. Last year, my predecessor as Director, Peter 
Orszag, proposed to you a 2-year plan to increase the CBO staff 
from 235 to about 260, a phased increase of 10 percent.
    Peter quantified the increased number of testimonies and 
the cost estimates that CBO has been asked to provide, as well 
as the growing amount of informal communication between CBO 
staff and Hill staff, and he argued in particular that CBO 
needed to increase its capacity to analyze policy changes 
regarding healthcare delivery and financing. We are very 
grateful that you and your colleagues approved the first leg of 
that increase, and our budget for next year requests additional 
funding to move closer to that goal.

             CBO deg.ADDITIONAL FUNDING FOR HEALTH

    As you know, we also have been asked to identify the steps 
we might take if additional funds were provided immediately to 
shorten the timetable for providing cost estimates of major 
health legislation. We have identified several steps, including 
acquiring additional high-speed computer hardware and software, 
purchasing actuarial and other expert consulting services, 
purchasing additional data on prescription drugs, providing 
additional compensation to certain CBO staff, and increasing 
the size of CBO staff.
    The analysts that we have previously hired in the health 
area are playing a critical role in our current work. Of 
course, faced with very intricate proposals to make fundamental 
changes to one-sixth of the U.S. economy, we are working very 
hard to analyze the proposals, provide the information that 
Members of Congress need to make decisions about what to do.
    As a result, all of our health analysts are working flat 
out to meet the demands we face, and still we are always adding 
to the list of crucial questions that we need to address. 
Therefore, our budget includes funding for additional staff 
members in the health area.

             CBO deg.FINANCIAL AND HOUSING MARKETS

    Our budget also asks for funding for additional staff to 
analyze the financial system and housing market. The financial 
crisis and the Government's responses to it have greatly 
boosted demand for our work. The legislation authorizing the 
Troubled Asset Relief Program (TARP) requires CBO to review the 
administration's reports on the TARP.
    In addition, our budget projections must include 
assessments of the cost of the TARP of dealing with Fannie Mae 
and Freddie Mac and of the dramatically expanded activities of 
the Federal Deposit Insurance Corporation (FDIC) and the 
Federal Reserve. More generally, our evaluation of the impact 
and cost of alternative financial and housing policies requires 
us to monitor and model the financial system to a degree we 
have not done before.

                 CBO deg.SUPPORT REQUIREMENTS

    Beyond the health and financial areas, we are also 
requesting several additional staff in the editorial and 
information technology functions, which are critical to our 
ability to produce and disseminate our findings.
    I should mention, too, that the additional people will need 
someplace to sit, as Peter Orszag discussed last year. And we 
have begun discussions about how to meet that need.
    I also want to emphasize that CBO has been responding to 
rising demands in some areas by shifting positions away from 
topics that become less central for the Congress. However, our 
scope for doing so is limited by the breadth of Congress' 
interests in climate change, in energy policy, in national 
defense, in discretionary appropriations, in monitoring 
economic conditions, and much more.

                           PREPARED STATEMENT

    In closing, let me thank the members of the subcommittee 
for your strong support of CBO's work in the past. Your support 
of our budget request for next year would help us continue to 
do our job to the high standard that you and we expect.
    Thank you. We will be happy to answer any questions you 
have.
    [The statement follows:]
               Prepared Statement of Douglas W. Elmendorf
    Mr. Chairman, Senator Murkowski, and Members of the Subcommittee, 
thank you for the opportunity to present the fiscal year 2010 budget 
request for the Congressional Budget Office (CBO).
    CBO's mission is to provide the Congress with timely, objective, 
nonpartisan analyses of the budget, the economy, and other policy 
issues and to furnish the information and cost estimates required for 
the Congressional budget process. In fulfilling that mission, CBO 
depends on a highly skilled workforce. Approximately 88 percent of the 
agency's appropriation is devoted to personnel, with the remaining 12 
percent for information technology (IT) and other equipment, supplies, 
and purchases of other items.
    The proposed budget for fiscal year 2010 totals $46,365,000, a $2.3 
million or 5.2 percent increase over the funding for fiscal year 2009. 
The net increase is the result of offsetting factors:
  --An additional $2.2 million for rising mandatory pay and related 
        costs for existing staff;
  --An additional $1.4 million to expand CBO's staff by 12 full-time-
        equivalent positions (FTEs), from 242 to 254; and
  --A reduction of $1.3 million in nonpay resources, partly because CBO 
        plans to use some of its additional FTEs instead of contractors 
        to analyze the Troubled Asset Relief Program and other 
        government actions in response to turmoil in the financial 
        markets.
                   growing demand for cbo's analyses
    The substantial budgetary and economic challenges facing the 
Nation, both short-term and long-term, and the major policy issues 
currently before the Congress have created a growing demand for CBO's 
analyses. Some of the issues--like health care and climate change--are 
very complicated and require intensive analysis involving many staff 
members. Often, committees and Members seek CBO's analyses very early 
in the process of developing legislation and then engage in an 
iterative process to refine the legislation in light of its projected 
budgetary impact. For significant legislation, simultaneous work may be 
required on multiple proposals--for example, ones by both the majority 
and the minority, the House and the Senate, or multiple committees of 
jurisdiction.
    The 12 additional FTEs (representing a 5 percent increase) that CBO 
requests for fiscal year 2010 would be used to help meet increased 
demand for analyses in several areas:
Health Care Issues
    Growing costs for health care continue to be a key contributor to 
the Nation's fiscal imbalance, and major health care legislation is on 
the agenda for the 111th Congress. However, the agency's current 
staffing in this area is insufficient to provide all of the analyses 
sought by the Congress, which are often needed on a very compressed 
schedule. CBO is increasing its work on options to expand health 
insurance coverage, long-term trends in the growth of health care 
costs, and potential areas of cost savings. It anticipates substantial 
work analyzing the impact on the Federal budget and on health care 
spending generally of several broad proposals to modify Federal health 
care programs and the broader health care system--a process that is 
well under way already. (The CBO staff is currently engaged in an 
intensive effort in support of the Senate Committees on Finance and on 
Health, Education, Labor, and Pensions as they begin the process of 
developing broad health legislation.)
    Four of the additional FTEs would continue an expansion of the 
agency's capabilities to analyze health care issues. That expansion 
began in fiscal year 2009, but because of the duration of the 
continuing resolution, CBO was not able to increase its staffing at the 
rate originally anticipated in the fiscal year 2009 budget request. As 
a result, CBO is reflecting these FTEs as new in the fiscal year 2010 
budget request.
    A number of Members of Congress have inquired as to what steps CBO 
might take to improve its ability to provide timely and accurate 
estimates to the Congress on major health legislation if additional 
funding was made available in fiscal year 2009. In response to those 
inquiries, CBO identified several steps that could be taken to 
accomplish that objective: acquiring additional high-speed computer 
hardware and software; purchasing actuarial and other expert consulting 
services; purchasing additional data on prescription drugs; providing 
additional compensation to certain CBO staff; and increasing the size 
of CBO's full-time staff by six more people than the number currently 
planned. In total, implementing those steps would cost about $2.5 
million over fiscal years 2009 and 2010. If such supplemental funding 
was provided and made available through 2010, there would be no impact 
on the agency's fiscal year 2010 budget request. If additional funding 
was provided but made available only through September 30, 2009, the 
cost of additional staff (about $1 million) would need to be added to 
the fiscal year 2010 budget request.
Financial and Housing Markets
    CBO will continue efforts begun in fiscal year 2009 to analyze the 
financial and housing markets, including analysis to meet requirements 
under the Economic Stabilization Act. That law authorizes the Treasury, 
through the Troubled Asset Relief Program, to acquire or insure up to 
$700 billion in financial assets. The law stipulates that CBO report 
semiannually to the Congress with the agency's assessment of reports 
compiled by the Office of Management and Budget, including a discussion 
of the costs of purchases and guarantees of troubled assets; the 
information and valuation methods used to calculate such costs; and the 
impact on the Federal budget deficit and the debt. In addition, the 
Federal Reserve, the Treasury, the Federal Deposit Insurance 
Corporation, Fannie Mae, and Freddie Mac are engaged in a variety of 
complex financial transactions aimed at stabilizing the financial 
markets, the banking system, and the housing market. Those transactions 
involve trillions of dollars, and CBO does not currently have the 
capacity to fully monitor and assess the impact of those activities.
    Analyzing complex financial transactions with a sufficient degree 
of rigor requires supplementing the agency's current staff with several 
analysts with expertise in financial modeling, some of whom will 
probably also have previous experience with institutions in the 
financial sector. Given the wide array of assets that may ultimately be 
purchased or guaranteed by the government and the difficulty of 
attracting highly skilled financial market analysts at government 
salaries, specialized outside consultants with experience in particular 
financial markets may also be necessary.
    Five FTEs would be devoted to this additional work on the financial 
and housing markets, including the requirements associated with the 
Economic Stabilization Act. Some of that work was, of necessity, done 
by contractors in fiscal year 2009 because of the lead time that it 
takes to hire experts in the financial arena.
Related Mission Support
    CBO's editorial and publications staff are important in making the 
results of the agency's analyses readily usable by the Congress and the 
public. With more output, additional staff in this area will be 
required to maintain the timely production of reports, testimonies, and 
other published materials. In addition, with the expansion of the 
agency, additional IT resources are required to meet greater needs for 
operational support.
    Therefore, to support the expanding analytic staff and mission, 
three additional FTEs would be devoted to providing editorial and 
publishing services and meeting IT requirements.
                               cbo's work
    CBO assists the Congress in exercising its responsibilities for the 
budget of the U.S. Government and for other legislation. Under the 1974 
Congressional Budget Act, the agency's primary duty is to support the 
Committees on the Budget of both Houses. The agency also supports the 
Congressional budget process by providing analyses requested by those 
committees; the Committees on Appropriations; the House Committee on 
Ways and Means; the Senate Committee on Finance; other committees; and, 
to the extent that resources permit, individual Members. In particular, 
CBO:
  --Reports on the outlook for the budget and the economy to help the 
        Congress prepare for the legislative year;
  --Constructs baseline budget projections to serve as neutral 
        benchmarks for gauging the effects of spending and revenue 
        proposals;
  --Prepares long-term projections of Federal spending and revenues to 
        help the Congress assess the impact of rising health care costs 
        and an aging population;
  --Assists the Committees on the Budget in developing the 
        Congressional budget resolution by providing alternative 
        spending and revenue paths and estimating the effects of 
        various policy options;
  --Analyzes the likely direct effects that the President's budgetary 
        proposals will have on outlays and revenues, their economic 
        implications, and any effects that those economic changes will 
        have on the budget;
  --Provides estimates of the cost of all appropriation bills at each 
        stage of the legislative process, including estimates for 
        numerous amendments considered during that process;
  --Reports on all programs and activities for which authorizations for 
        appropriations were not enacted or are scheduled to expire;
  --Provides estimates of the cost of many legislative proposals, 
        including formal cost estimates for all bills reported by 
        committees of the House and Senate and detailed explanations of 
        components of cost estimates and the estimating methodology;
  --Estimates the cost of intergovernmental and private-sector mandates 
        in reported bills and other legislative proposals;
  --Conducts policy studies of governmental activities having major 
        economic and budgetary impacts;
  --Provides testimonies on a broad range of budget and economic 
        issues, addressing the agency's budget projections as well as 
        specific issues related to national security, health care and 
        climate change policy, alternative means of financing 
        infrastructure spending, economic and financial conditions, and 
        numerous other program areas;
  --Helps the Congress make budgetary choices by providing policy 
        options, but not policy recommendations, for how it might alter 
        Federal outlays and revenues in the near term and over the 
        longer term;
  --Analyzes Federal spending and revenue totals each month; and
  --Constructs statistical, behavioral, and computational models to 
        project short- and long-term costs and revenues of government 
        programs.
         some details of cbo's fiscal year 2010 budget request
CBO's request would allow the agency to build on current efforts. 
        Specifically, the request would fund the following:
  --A workload of roughly 700 formal cost estimates (most of which 
        include both estimates of Federal costs of legislation and 
        assessments of the cost of mandates included in the legislation 
        that would affect state and local governments, Indian tribes, 
        or the private sector) and hundreds of informal estimates, 
        approximately 100 analytical reports along with other 
        publications, and a heavy schedule of Congressional testimony;
  --254 FTEs, an increase of 12 (4 to continue the expansion of the 
        agency's capabilities to analyze health care issues; 5 to 
        devote to CBO's additional analyses of the financial and 
        housing markets, including new requirements under the Economic 
        Stabilization Act; and 3 to support the expanded mission of the 
        agency);
  --A projected 8 percent (or $2.3 million) increase in base pay, of 
        which $1.1 million would support the 12 new FTEs and the 
        balance of $1.2 million, a combination of across-the-board 
        increases, promotions, performance bonuses, and merit increases 
        for current staff (the across-the-board increase is budgeted at 
        2.9 percent for staff earning a salary less than $100,000, 
        which is consistent with the pay adjustment requested by other 
        legislative branch agencies);
  --A projected 14.7 percent (or $1.3 million) increase in the cost of 
        benefits, of which $0.4 million would go toward the 12 new FTEs 
        and the balance ($0.9 million), toward existing staff and 
        employees who will fill vacant positions;
  --The replacement of obsolete office equipment, desktop computers, 
        and network servers, at $0.9 million--a decrease of $154,000, 
        made possible because start-up requirements for the new staff 
        are funded in fiscal year 2009 and do not recur;
  --Expert consulting, at $0.7 million--a decrease of $1.3 million, 
        which is made possible in part by shifting from contractor 
        support to full-time staff to meet new requirements under the 
        Economic Stabilization Act and to conduct other analyses in the 
        financial and housing markets;
  --Purchases of office supplies and subscriptions, at $0.6 million--a 
        decrease of $138,000, made possible because some costs in 
        fiscal year 2009 are nonrecurring;
  --A contribution toward the activities of the Federal Accounting 
        Standards Advisory Board at a normal operating level of $0.5 
        million--an increase of $58,600 based on inflation, as 
        projected by the Government Accountability Office;
  --The acquisition of commercial data necessary for CBO's analyses, at 
        $352,000--an increase of $7,000;
  --Financial management services, including support for payroll and 
        financial systems, at $318,000--an increase of $39,900, 
        primarily because of anticipated price hikes when renewing 
        option-year contracts;
  --IT system development, at $304,000--a decrease of $10,500 based on 
        anticipated requirements;
  --Essential software purchases, at $268,000--an increase of $8,000;
  --Equipment maintenance, at $237,200--an increase of $2,000 based on 
        current contracting data;
  --Travel, at $229,800--an increase of $56,000, including costs to 
        support new FTEs and added training;
  --Telecommunications and telephone services, at $203,600--an increase 
        of $8,100;
  --Management and professional training, at $170,000--an increase of 
        $21,500, of which $14,000 would be for the new FTEs, with the 
        balance restoring training to roughly the fiscal year 2006 
        funding level;
  --The completion of the redesign of the agency's Web-based 
        information services and platforms, at $125,000--a project to 
        update the agency's obsolete external and internal Web sites to 
        enhance their usefulness, with improvements in content, 
        functionality, and the timely delivery of various work products 
        to the Congress; and
  --Independent audit services, at $102,900--an increase of $4,900, 
        which is based on contract award data.
    I am pleased to report that CBO received its fifth consecutive 
clean opinion in the latest audit of its financial statements. The 
agency's sixth audit (of fiscal year 2008 financial statements) is 
ongoing.
    Finally, I would like to thank the Committee for the funding 
provided this year, enabling CBO to carry out its responsibilities to 
provide information and analysis to the Congress as it grapples with 
the critical issues facing the Nation.

    Senator Nelson. Thank you.
    Should we do 5 minutes first round here?

    GAO deg.LEGISLATIVE BRANCH OSHA ENFORCEMENT PROVISIONS

    Mr. Dodaro, at our hearing a couple of weeks ago, we 
discussed the Office of Compliance's Occupational Safety and 
Health Administration (OSHA) oversight of the legislative 
branch as set forth in the Congressional Accountability Act, 
and we found that perhaps the legislative branch was being held 
to a higher standard than the executive branch. And while I 
don't want to be in competition with a race to the bottom, or 
anything of that sort, it does seem that some parity might make 
some sense.
    Could you explain what you think about the legislative 
branch enforcement provisions for the OSHA, why they are 
different from the executive branch? I mean, if there is some 
justification we don't understand, we would certainly like to 
pick it up.
    Mr. Dodaro. My understanding, based on the work that we 
have done for the legislative branch over the years, is that 
one of the areas we were asked to look into a few years ago was 
the Office of Compliance and its management practices. With 
regard to the OSHA provisions, my understanding is that while 
the provisions about the type of safety requirements are on par 
with the executive branch and the private sector standards, the 
Congressional Accountability Act required a specific timeframe 
for violations to be fixed and funded that is different and, if 
you will, a little bit tougher standard than what applies to 
the executive branch and the private sector.
    And I am sure, without speaking for the congressional 
intent here, it was intended to make sure that the identified 
deficiencies were rectified over a certain period of time. But 
it does not provide a lot of flexibility that is provided in 
the executive branch and the private sector.
    So, if you would like, we could look at how to make it on a 
par with the executive branch and suggest some legislative 
language for you to consider.
    Senator Nelson. That is where I was going to go, and I 
appreciate your anticipating that because, clearly, we ought 
not to have tied our hands more than others have tied their 
hands. Because when addressing the requirements for fixing the 
defects that the citations reflect, we ought to do it in a 
rational, reasonable, and appropriate fashion. And so, I would 
be very anxious to see what kind of language you might 
recommend for us to consider.
    Mr. Dodaro. Yes, we will do that.
    Senator Nelson. And I think it might also be helpful for us 
to have some evaluation of the kind of requirements that are 
being imposed with open staircases in the old, historic 
buildings, and not just as to the cost, but what this can do to 
the structure that represents the history of our country.
    I don't want us to start seeing fire doors in the middle of 
these buildings, particularly where we understand in some cases 
there is a considerable amount of sprinkler systems in place. 
That if one of our buildings was being treated differently than 
it would have been treated under the executive branch. We will 
get you some information on that as well.
    Mr. Dodaro. Okay. Yes, we would be happy to take a look at 
that issue. Certainly, the historical character of the Capitol 
and buildings is a very important issue, and that needs to be 
balanced with safety issues in place and some creative thinking 
about how to achieve both within a reasonable cost. We would be 
happy to take a look at that.
    Senator Nelson. Well, we are certainly on the same page, 
and I appreciate that very much.

 GAO deg.GAO'S STRATEGY TO MEET RECOVERY ACT RESPONSIBILITIES

    On the stimulus funding, you received $25 million in the 
stimulus funding to be able to do your oversight. Can you 
update the subcommittee on what you are doing with those funds 
and how you are spending them? What you are doing to gear up to 
provide the oversight?
    Mr. Dodaro. Yes. The $25 million was provided to us, and it 
is available through September 30, 2010. There are timeframe 
parameters on it. We are hiring additional people to help us. 
We have employed, I believe, a very creative approach to do 
this because you are never sure that you have the money to 
sustain those people after that period of time when the funding 
is available.
    So two-thirds of the people we are going to hire are going 
to be people who have retired from GAO that we are bringing 
back for specific periods of time. Some of them live in the 
States that we are evaluating which will save us a lot of 
travel cost.
    We are also bringing back or hiring people on term 
appointment, so they will be here for a limited period of time. 
And then the other one-third of the people we are going to hire 
at the entry level, and we will be able to absorb those people 
likely through normal attrition over the next couple of years.
    So we believe this serves the intent for the limited amount 
of funding that is available. Our work, given the spend-out 
rates for the stimulus bill, will extend beyond 2010. We will 
build that into our normal budget request going forward because 
most of the money will be outlayed to the localities in 2010, 
2011, and some of it goes out a little bit further. But the 
bulk of the money is in those periods of time.
    We think we have got a very good plan to meet our 
responsibilities under the act and appreciate Congress' 
support.
    Senator Nelson. Thank you.
    Senator Murkowski.
    Senator Murkowski. Let me follow up on that. The 
individuals that you have indicated that you are going to be 
bringing on to be responsive to oversight with the Reinvestment 
Act, how many of the 109 additional staff that you are looking 
for in this budget are actually going to be focused on this 
aspect, on the American Recovery and Reinvestment Act?

                   GAO deg.GAO'S FTE REQUEST

    Mr. Dodaro. Very few, if any of the 109 additional FTEs in 
our 2010 budget request would be for the Recovery Act purposes. 
Now we might have to supplement the proposed staffing as things 
progress and new requirements come up because we are beginning 
to receive requests on the Recovery Act beyond the current 
statutory requirements. So the additional staff requested could 
help support those, but it is not intended to do that, Senator 
Murkowski.
    The 109 FTEs are intended to help us in several key areas. 
First is in the areas of financial markets and community 
development. As Doug Elmendorf mentioned, the financial system 
and the housing markets really need a lot of attention. And so, 
we think we can help Congress tackle some difficult issues 
there and bring about some needed reforms. But we need 
additional people.
    Also, in the science and technology area, we are being 
asked to look at more sophisticated weapon systems, satellite 
systems, and a lot of, as you are well aware, solutions to our 
environment and energy issues, require the application of 
technologies. Congress has asked us to do technology 
assessments in the past. So we plan to bolster staff in these 
as well as help in a range of other areas. But it is not for 
the Recovery and Reinvestment Act primarily.
    Senator Murkowski. It seemed, as you were going through 
earlier, you mentioned that it would be to help monitor and 
follow and produce the reports that are requested under TARP, 
auditors for Fannie and Freddie for the Bank Insurance Fund, 
and then the Recovery and Reinvestment Act, and the 2010 
census. All of these are, hopefully, short-term initiatives.
    You are asking for 109 additional staff. What is the magic 
in that number? You have indicated that you are at the lowest 
staffing level that you have been in some time. How much of 
what you are asking for now is to provide for these very 
targeted focuses? Will this 109 be here for a period of a 
couple of years while we work on these projects, or do they 
become part of the base of the staffing level?
    Mr. Dodaro. Right. I mentioned the TARP initiatives and the 
American Recovery and Reinvestment Act as areas of new 
responsibilities for GAO. They will be limited over time, 
although I don't know how long the TARP program would be, 
particularly if the Government procures the toxic assets and 
holds them to maturity over a period of time. That could go on 
for an extended period of time, and the American Recovery and 
Reinvestment Act will be several years.
    However, those areas are still relatively a small part of 
GAO's overall service to the Congress among the 1,200 requests 
we have. So the 109 FTEs are really intended to be part of the 
base to address the wide range of issues from all committees in 
the Congress that we receive, including a lot of the work we do 
in the defense area on defense capabilities and management and 
acquisition reform. We do work in cyber security. So everything 
the Federal Government is involved in, we are doing work on.
    The 109 FTEs are intended to help in that work because we 
can't get to all the requests we receive from the Congress in 
as timely a fashion as I would like and that many of the 
committees would like.
    Senator Murkowski. Is 1,200 requests from Congress about 
average? Are we seeing an ever-increasing number of requests?
    Mr. Dodaro. It has increased since 2005 by about 15 
percent, and it has held steady at 1,200. We work with each 
committee to reprioritize those requests to make sure that we 
are working on the top priorities.

              GAO deg.GAO'S STAFFING LEVEL TRENDS

    Senator Murkowski. So if, in fact, you have seen an 
increase of 15 percent since 2005, what has your staffing level 
been since 2005?
    Mr. Dodaro. For 2009, it has only increased by 60 full-time 
equivalents (FTEs). It actually had been going down. And so, we 
had a situation where the requests were going up in 2006 and 
2007, and the staffing usage was going down. Last year, I asked 
for a 150 FTE increase. We got about one-third of that, and are 
now coming back to ask for more.
    I firmly believe if the 109 FTEs are addressed, that will 
be the right size for GAO--assuming there are no further 
unusual events in our economy, and let us hope not.
    Senator Murkowski. Everything is unusual.
    Mr. Dodaro. Yes, but at this time, I think that is the 
right level for us to serve the Congress. So I don't see us 
coming back every year and asking for additional funding. I 
think this will get us up to a level that we can provide 
quality service to the Congress across the breadth of 
committees in a timely fashion.
    Senator Nelson. They did call the vote. So we will take 
about a 10-minute break. Be right back.
    The vote has been accomplished. And with any luck and good 
fortune, we won't have another interruption for a while. So 
appreciate your forbearance.

                 GAO deg.GAO'S HIRING STRATEGY

    Mr. Dodaro, on the 109 new FTEs, is that a number that is 
easily absorbed within a year? In other words, within 12 
months, or would it be safe to say that you could do it over a 
2-year period if you had 50 and 50 or roughly some number?
    But is it doable to bring on 109 people conceivably on the 
first day of the budget if you have an annualized appropriation 
rather than feathering them in over a period of time?
    Mr. Dodaro. Mr. Chairman, we have an ongoing recruiting 
process. Each year, we replace about 10 percent of our 
organization, which is over 300 people, just to replace normal 
attrition. That has held pretty steady, although we are down a 
little bit this year due to the economy. Not everybody is 
retiring as what they originally planned.
    But in the past we have brought in over 400 people in a 
year. If the Congress acts before the end of the fiscal year 
and we have a budget going into the fiscal year, rather than 
have a continuing resolution, we believe we can do that. We can 
bring in staff to replace attrition, and increase 109 FTEs.
    Senator Nelson. And absorb it all at the same time?
    Mr. Dodaro. Yes, with qualified people.
    Senator Nelson. Of course. Of course.

                GPO deg.GPO'S BUILDING REPAIRS

    Mr. Tapella, you are asking for $13.6 million in fiscal 
year 2010 to maintain and repair your buildings, but it is my 
understanding that you are also pursuing the idea of relocating 
to a smaller building in the near future. And is there an 
inconsistency in wanting to spend money on a facility that you 
may be leaving, or is this a facility other than the one that 
you would be leaving?
    Mr. Tapella. Thank you for the question, Mr. Chairman.
    GPO would like to build a new, modern manufacturing 
facility on our back lot. We have approximately 7 acres, 5 
blocks here from the Capitol, and we have enough land to build 
a new facility immediately behind our current facility. That is 
our goal.
    And in doing so, we would not only free up the 1.5 million 
square feet that is currently in our existing facilities, but 
we would be able to create a modern manufacturing facility on 
one level. We would be able to meet all of our needs in terms 
of office space and be able to build an additional 1 million 
square feet of space that could be available to the legislative 
branch should it need it, in addition to the 1.5 million square 
feet that we would be vacating.
    In answer to your question about whether it is 
inconsistent, I don't believe it is, sir. We have been trying 
to get a new building for 5 years. Prior to my time at GPO, 
there was a decade where there was a lot of deferred 
maintenance, and we are now dealing with safety and health 
issues.
    We have got elevators in particular--we are moving material 
and people up and down eight stories all day long. My highest 
priority item is elevator repair within that $13.6 million.
    Senator Nelson. You have been optimistic in the past with a 
little bit of deferred maintenance, and now you may not be 
quite as optimistic about the new building, and so let us take 
care of the old building, just in case. Is that fair?
    Mr. Tapella. Well, I don't know that it is necessarily 
whether it is optimistic or----
    Senator Nelson. Oh, I was just having a little fun.
    Mr. Tapella. Oh, okay. Quite honestly, you can only defer 
maintenance for so long, and then things die. And at this 
point, I have got three elevators that are completely out of 
service because they are not safe to be operated.

                     GPO deg.GPO SECURITY

    Senator Nelson. I understand. I also understand that GPO 
does some rather complicated security work for us, and you rely 
on your own police force, and you have contract guards as well. 
What are the differences in responsibilities of the contract 
guards versus your own employees who serve as your security?
    Mr. Tapella. Thank you for that question as well.
    We have 52 uniformed police officers, or we are budgeted 
for 52 uniformed police officers and currently have 8 
vacancies. We also run anywhere between 46 and 44 special 
police officers (SPOs), which are contract officers.
    Now, the mission of our police force and the combined 
security force is actually twofold--one, access control and the 
other protecting GPO's assets, such as the United States 
passport and other work in progress.
    We are looking at our total security posture, and it is a 
mixture of the two. The special police officers handle just 
access control. They are standing at magnetometers, working 
employee entrances, and greeting employees and visitors.
    Our uniformed police force, with the exception of 
protecting the asset of the United States passport, is there to 
respond to incidents and other issues. So when an alarm goes 
off, the uniformed police officers respond.
    Senator Nelson. Would there be much difference in the 
training of these individuals?
    Mr. Tapella. There is a difference in training. All of our 
uniformed police officers, which are the Federal officers, go 
down to Glynco, the law enforcement training center facility 
down in Georgia, to be fully trained. And they are full police 
officers.
    The special police officers have less training. They have 
firearms training. They have access control training, crowd 
control training, and the basic needs that fit what they do.
    Senator Nelson. And what about a differential in the cost? 
Is there a differential? Do you save money by having the two 
different security forces?
    Mr. Tapella. Yes. The SPOs are anywhere between one-third 
and one-half the cost of somebody of the uniformed police 
branch by the time that we include all of the benefits for the 
Federal officers.
    Senator Nelson. Have you had a study to establish that the 
level of security that you get from these two security forces 
is the kind that you truly want? In other words, that there is 
no diminution of security because some are contracted out 
versus some are employed?
    Mr. Tapella. Any time you are talking security, you are 
looking at two things--cost and risk. And you can always have 
more security, but you will have an intended cost, and you have 
to look at what that risk is of an incident occurring.
    In fact, GAO just completed a study of GPO's security, and 
briefed the Appropriations Legislative Branch Subcommittee on 
the House side as well as our oversight committee. In their 
report, they said, ``GPO generally conforms to key practices in 
Government facility protection.''
    I believe that we have the right mix. I am not a security 
expert. However, I do have security experts on staff that are 
running our entire security systems. It involves not just our 
officers. It involves alarms. It involves intrusion detection. 
It involves cameras and a general presence.
    In fact, just last week, the District of Columbia 
recognized the GPO police force and our security services. They 
did a 500-foot radius around 732 North Capitol Street, and the 
amount of crime in that area has been reduced significantly 
over the last 3 years since we have implemented the combination 
of uniformed police officers and special police officers.
    Senator Nelson. Well, it is hard to believe that the House 
got ahead of us, but they did. Because I was going to suggest 
Mr. Dodaro do that very thing in evaluating your police, but 
for once, the House has gotten ahead of the Senate. So we won't 
have to ask for that.
    Thank you.

           CBO deg.SUPPLEMENTAL APPROPRIATIONS BILL

    Dr. Elmendorf, the Senate version of the fiscal year 2009 
supplemental appropriations bill--we talked about this earlier, 
but I would like to get it for the record--includes that $2 
million for CBO to address Congress' growing demand for work. 
Would you explain to us how that is going to happen?
    And let me say that what my colleague was bringing out, it 
seems like Congress asked you to do more work and then gives 
you fits because you want to charge and put in your budget for 
that work. It doesn't seem quite fair that you get squeezed at 
both ends. ``Give us more. We want to give you less.'' But 
maybe you can tell us a little bit about the $2 million?
    Dr. Elmendorf. We appreciate your concern, Mr. Chairman, 
for that position. When we formulated our budget request for 
fiscal year 2010 a few months ago, we put forth what we viewed 
as an important, but modest request for additional funding.
    Starting a few weeks ago, some of your colleagues in the 
Senate became concerned that CBO might be unable to deliver 
estimates of the effects of health reform proposals as quickly 
as was desirable. I want to be clear we have delivered a 
tremendous amount of analysis. We have delivered preliminary 
estimates of more than 100 specific health reform items to the 
relevant committees, and we have delivered preliminary 
estimates of several full-scale reform proposals, overhauls of 
the insurance system to several committees.
    So we have done a tremendous amount. And as I mentioned in 
my remarks, our health staff is working around the clock. But 
it is undoubtedly the case that the committees would like more 
analysis faster. The complexity of the proposals they are 
considering and the variance on the proposals and the variance 
on the variance will, indeed, overwhelm our ability to do that.
    So we were asked what we might do, if funds were provided 
immediately, to accelerate the process of providing analysis. I 
tried to be clear to everybody who has asked or who has to sit 
and listen, that doing more health analysis does not amount to 
going down to the temp agency and just checking the box on 12 
new people and bringing them back to the office and lining them 
up, and then new results come out.
    On the other hand, we do understand the urgency that 
Congress feels for these analyses. So we put together a 
collection of steps we might take with additional funding.

                 CBO deg.HIGH SPEED COMPUTERS

    The supplemental has $2 million for us in it, and the 
purposes to which we have said we would put that are, first, to 
acquire high-speed computer equipment, a very basic point. But 
the proposals we are now analyzing are much more complicated 
than the ones we have done in the past, and just the computing 
time is slowing us down. And new computers that we could have 
in place within weeks of getting the money would accelerate 
that process. We would spend $300,000 on new computer 
equipment.

             CBO deg.ACTUARIAL AND EXPERT SERVICES

    We also propose spending $400,000 to purchase actuarial and 
other expert services from private agencies. When we estimate, 
for example, the cost of various health reform proposals, 
judging the health and, thus, the likely health spending for 
people in certain pools is an important part of the estimate. 
And we have some of those skills in-house and can do that 
ourselves with time, but could do it much more accurately and 
quickly with outside services.

                CBO deg.PRESCRIPTION DRUG DATA

    We propose spending $300,000 on data on prescription drugs, 
so we can better gauge the cost of plans that would provide 
drug benefits or would change the way Government purchases drug 
benefits for individuals.

                CBO deg.ADDITIONAL COMPENSATION

    We would spend $250,000 in additional compensation to CBO 
staff, people who are working around the clock and, I think, 
show a great commitment to public service. But I am concerned 
that weeks and months of this process will drive them into the 
ground and that we will ultimately lose their services in the 
future, and this is a way of trying to make up for some of the 
dislocation of their lives.

                   CBO deg.ADDITIONAL STAFF

    And then we would spend $750,000 to further increase the 
size of CBO staff, to hire four additional people to work in 
the health area. As you know, we have hired very aggressively 
in this area, I think appropriately so. We, of course, need to 
hire the right sorts of people, and other places in the world 
are also demanding people with expertise in health. So it is 
not straightforward, but we have been able to hire.
    I think we have been very pleased at our ability to put the 
people we have hired over the past year to effective work. 
Obviously, people come with a lot of knowledge, but not with 
all of the knowledge they need. And we have been concerned 
about our ability to integrate them. But that has worked out, I 
think, quite well that we have actually--we are getting 
immediate value out of or nearly immediate value out of the 
people we have hired.
    And we think with additional funding, we could bring on 
board more people, and that would enable us to do our jobs more 
effectively and more quickly.
    Senator Nelson. I am sure it must seem like the Finance 
Committee has its foot on your accelerator, and this committee 
has its foot on your brake.
    Dr. Elmendorf. No, Senator. A number of committees have 
their feet on our accelerator, but we do not view you as the 
brake. We appreciate your support very much.
    Senator Nelson. Senator Murkowski.
    Senator Murkowski. Well, I appreciate the explanation that 
you have given, Dr. Elmendorf. I will admit that I looked at 
the request and the supplemental and said why does this have to 
be in the supplemental? Why the urgency? But I think you have 
related it does appear that what has been requested in the supp 
will be spent within this next year.
    Dr. Elmendorf. As I understand the supplemental, the money 
is available to us for the rest of this fiscal year and through 
fiscal year 2010. That is important because we can't hire 
people in August and not pay them in October. But we do expect 
to spend the money over that period, and I think we will put it 
to good use.
    Of course, it is your choice whether that is the best 
available use of the money. But we will put it to use for you, 
no doubt.
    Senator Murkowski. Appreciate you responding to that.

     GAO deg.PRIVATE SECTOR REPORTING ON THE RECOVERY ACT

    Mr. Dodaro, I had one more question for you. There was an 
article in the Post this morning about the review, the online 
review of the spending of the stimulus dollars under the 
Recovery Act, and it made reference to a Web site that 
apparently was not the Government's Web site but was actually 
doing more of what we had hoped than our Web site. Can you give 
me a little more background on that?
    Mr. Dodaro. My understanding is that, and I read the 
article that you talked about, and it is recovery.org rather 
than dot gov.
    Senator Murkowski. Right.
    Mr. Dodaro. And it seemed to indicate that they were paying 
people to go through contract documents and public records and 
things that were done across the country and then taking that 
information and populating their database with it, as opposed 
to the approach that will be used by the executive branch, 
which is to have reports provided by the Federal agencies and 
then have reports come back from all the recipients that have 
received Recovery Act funds. They are required to submit 
quarterly reports.
    Now the quarterly reports are not estimated to begin coming 
into the Federal Government until October. They may have some 
pilot reports in July. One of the recommendations we made in 
our first report was to better define the data collection 
requirements because some of those reports are supposed to 
outline the number of jobs preserved or created, along with the 
status of the additional funding.
    But the basic difference is that you have a private sector 
entity that is combing through public records at all levels of 
Government and putting information together from those sources 
versus the Federal Government building a Web site from the 
Federal agencies and then collecting information from State and 
local and other recipients of the funds.
    We have not evaluated the accuracy or completeness of a 
private sector data source, and we would not have the authority 
to do that. We do plan to evaluate the Federal Government's Web 
site.
    Senator Murkowski. Which I think is appropriate, and you 
should be doing. It does make for kind of an awkward 
comparison, if you will, that, as the Government, we have 
tasked you to do this and, thus far, there is not much to 
report, and yet you see that out there in the private sector, 
they are thumbing through reports and gathering information. It 
does all come down to the accuracy of it.
    Mr. Dodaro. Right.
    Senator Murkowski. I don't know anything more than what I 
read in the paper this morning. I hate to get all of my 
information from the Post, but it is something that I wanted to 
raise because that question will be asked. Well, why is the 
Government so slow in responding if private guys can get this 
information, why are we so slow?

          GAO deg.GAO'S INITIAL RECOVERY ACT FINDINGS

    Mr. Dodaro. Part of the problem is the number of funding 
streams that are occurring at this level, involving many 
different Federal agencies and programs. Some of them are 
flowing directly to localities, bypassing the States. Some are 
going through the States and then allocated down.
    And one of our efforts is to focus at the State and local 
level and to provide that information. So we are tracking that. 
The programs have different requirements. Some of the money, 
for example the Medicaid money, paid States retroactively to 
October 2008. So some of that funding got out a little earlier 
than the funding for transportation highways.
    The 16 States that we looked at had been allocated about 
$15 billion. There is only $3.3 billion that was obligated. In 
that case, the Federal Government and the States had agreed on 
about 950 projects. Most of them are still in the bidding 
process. So in April and May, a couple of States, Mississippi 
and Iowa, had actually awarded contracts and put them in place. 
And then the State stabilization fund is even more complicated 
because most of that goes to education, but 18 percent they can 
use for a wide range of public services.
    So we are trying to track this, and it is in varying stages 
of development. But I think the real question is the accuracy 
and the completeness of whatever information is collected. And 
hopefully, we will be in a position for the localities we are 
at to provide insight into that.
    Senator Murkowski. And we appreciate the complexity, most 
definitely appreciate the complexity. I feel my job, as a 
legislator, now that that money is either out on the street or 
getting out there, we are charged with making sure that there 
is that level of accountability. There is that level of 
transparency. So we do rely on you for that accurate 
information.
    Mr. Dodaro. One of the things I might point out is that one 
of the recommendations that we made is that the administration 
clarify the amount of money that the States could use to ensure 
adequate oversight and accountability of the funds. A number of 
States, as I am sure you are aware, have cut back, because of 
their own financial stress, on some of the management functions 
and the auditing functions that they normally have in place to 
do that, and that was a concern to us.
    And so, we made that recommendation, and hopefully, the 
administration will act on that. They are beginning to clarify 
that issue. But I think that is a very important point that 
needs attention.
    Senator Murkowski. Mr. Chairman.
    Senator Nelson. Thank you.

                 GPO deg.GPO'S REVOLVING FUND

    Mr. Tapella, GPO is requesting over $32 million in fiscal 
year 2010 for the so-called revolving fund. Could you explain 
how the revolving fund works, and which items in this request 
are the most critical for the success of your agency? If you 
could, just give us some idea of how this works.
    Mr. Tapella. Thank you, Mr. Chairman.
    Our revolving fund is like a business checking account. 
This year our budget was originally set at $1.02 billion, of 
which roughly 12 to 13 percent is direct appropriations from 
Congress. The remainder we earn by selling products and 
services to all three branches of the Government, as well as 
products to the public through the GPO bookstore.
    Like any business, we have a checking account, and money 
comes in and money goes out. For example, the congressional 
printing and binding fund, when we complete work for Congress, 
we then bill the appropriation, and the money gets moved from 
the appropriation account into the GPO revolving fund. And like 
any business, we keep reserves in our accounts.
    In terms of our priorities for our request for the 
revolving fund, our highest priority is the completion of 
FDsys, the Federal Digital System, which we released earlier 
this year, and that is an $8 million request.
    The second priority is the composition systems replacement 
project, which is $2 million. And this project is to replace 
the system that we use to create all congressional work, plus 
the work we do for the Office of Federal Register and some 
other customers.
    The total cost of that project is roughly, we are 
guesstimating, around $5 million. Last year, GPO allocated out 
of our retained earnings $2 million. We are asking Congress for 
$2 million to cover the congressional proportion of it, and 
anything beyond that we will deal with it as we move forward in 
the project. But we are thinking it could be as much as $1 
million or so beyond the $4 million, the $2 million we have 
allocated and the $2 million we are asking for.
    The third item is what we call GBIS, which is our financial 
system, and it is an Oracle-based financial system. And we are 
asking for a $3 million investment there. Like any business, we 
have to bill customers, and that is what we do with the Oracle 
system.
    We also have to phase out our R-22 air-conditioning 
coolants, and that is a requirement from the EPA this year, and 
we need to fund that at $200,000. And finally, there is $3 
million for elevator repairs. So out of that money we are 
requesting for the revolving fund for the projects that are a 
priority is $16.2 million.

         GPO deg.PUBLIC PRINTER'S REPRESENTATION FUND

    Senator Nelson. What is the Public Printer's representation 
fund?
    Mr. Tapella. Most Federal agencies have what is called a 
``rep fund,'' which is a representation and reception 
allowance. And in GPO's case, it is not new appropriated money. 
In GPO's case, it is an authorization to use up to $5,000 in 
our revolving fund. We have a limitation by law that we can 
only spend up to $5,000 in our revolving fund for 
representation and reception expenses, subject to restrictions 
on what these funds can be used for.
    Now, unlike most other agencies, we are basically a wholly 
owned Government business, and we have to sell products and 
services to other agencies. That is our complete marketing 
budget for representation and receptions. So it is $1 billion 
enterprise, and our complete marketing budget for these costs 
is $5,000.
    I would like to see, if possible, permission to have that 
increased up to $7,500. And basically, this past year--I have 
been Public Printer now 18 months. In the last calendar year, 
the $5,000 was not enough to meet the needs of the business. 
And personally, I contributed a little over $20,000 to make 
certain that GPO could meet its representation and reception 
needs.
    Senator Nelson. If you doubled that or you tripled that, 
what would it do to your revenues?
    Mr. Tapella. Well, one, I hope it would help us to continue 
in new business development. We have seen a revenue line--our 
revenue trend has been going upward for the last 7 years. We 
got a significant spike because of the increase in both the 
type of passport, the new electronic passport, and the number 
of passports produced.
    But all of our other businesses are growing as well. And 
when we look at the total cost for the Government Printing 
Office, we have a lot of overhead, which is our IT, our 
infrastructure, our buildings. If we do not have business 
opportunities with other agencies, the demands on our 
appropriations are going to be significantly greater.
    I would like to see us put a significant emphasis into new 
business development. That is mostly in the areas of security 
and intelligent documents. For example, we now produce for 
Customs and Border Patrol, the NEXUS and SENTRI cards, which 
are the cards that are used for border crossings to Canada and 
Mexico. We also do the FAST card. We just got a contract with 
the Department of Health and Human Services (HHS) to do the 
Medicare card for Puerto Rico.
    We have these significant capabilities, but we need to be 
able to make sure we are marketing them as much as we can, 
including through our representation and reception fund. And in 
my view, these items are inherently governmental. Security IDs 
and other secure documents ought to be in a Government-owed, 
Government-controlled facility rather than sent to a private 
contractor in the private sector.
    Senator Nelson. Thank you.

                    GPO deg.CHANGES AT GPO

    Senator Murkowski. Mr. Chairman?
    I appreciate your comments, Mr. Tapella, about kind of 
where or how the GPO is actually changing in terms of what it 
is dealing with and basically staying current and looking for 
those business opportunities. You have mentioned security and 
intelligent ID. What additional changes might you envision 
within the next, say, 5 to 10 years in terms of what it is that 
you are doing?
    Mr. Tapella. I think it really falls into two buckets. One 
bucket is in electronic information. GPO currently operates a 
traditional bookstore. It is on North Capitol Street. We sell 
tangible books. We also have the authority to sell electronic 
information products and have had that authority since 
approximately 1987.
    With the release of FDsys, which is our Federal Digital 
System, which is a repository of authentic Government 
information and electronic forms, I believe that there are some 
business opportunities there, particularly in the area of print 
on demand, as well as in the area of distributing that 
information in a slightly different way. That is one bucket.
    The second bucket is really in the area of secure ID cards. 
Right now, we produce the passport for the State Department. It 
has an electronic chip embedded in it. To date, GPO is the 
single largest chip buyer in the Federal Government. So we have 
economies of scale.
    We are producing and did produce on behalf of the JCCIC, 
the Joint Congressional Committee on Inaugural Ceremonies, the 
secure credential card used by 10,000 police officers on the 
day of the inaugural. And it was a high-tech ID card.
    We are in the process of doing the NEXUS and SENTRI cards. 
We are looking at becoming the backup supplier for the CAC, 
which is the central access card used by the military, or 
common access card used by the military.
    It also takes advantage of the skilled labor we have at 
GPO. We are not only a traditional paper and ink manufacturer, 
we also are in the electronics business. And I would like to 
see those skills and talents of our employees maximized.

                 GPO deg.DEMAND FOR PASSPORTS

    Senator Murkowski. You have mentioned a couple of different 
times the collaboration between GPO and the State Department as 
it relates to the passports with the electronic chip. I 
understand that we have seen a drop-off in demand in terms of 
the passports quite noticeably. How has this fluctuation in 
demand impacted GPO, and are we at the point where the demand 
for passports has stabilized? Do you see that changing at all? 
What do you consider there?
    Mr. Tapella. Last year, because of the significant demand, 
we produced 24.5 million passports. The State Department 
originally anticipated this year that the request was going to 
be 16.5 million passports, and we built a budget around 16.5 
million passports.
    We got a surprise the week before Christmas, which was at 
the end of the first quarter of the fiscal year, where they 
said, ``No, no, this year we will only need 10.5 million 
passports.'' That represented roughly a $75 million decrease in 
revenue to the Government Printing Office.
    When we originally set our budget, we set roughly $2 
million in net income. And that is the money that we use to 
reinvest in our business. Obviously, we don't have that this 
year.
    And in fact, in December, we were facing a roughly $36 
million budget gap between anticipated revenues and what our 
expenses were for the year. We have now got that cap down to 
roughly $10 million to $13 million, and over the course of this 
year, we will end the year, I believe, in the black. But we 
will probably be lucky if we make $2 or $3 million in net 
income by the end of this year.
    We are at the mercy of our customers, just as we are at the 
mercy of Congress in terms of what Congress does. In last 
year's appropriation, we had revenue to pay back GPO's 
revolving fund from money expended to do congressional work 
because there wasn't enough money previously allocated for such 
purposes.
    And so, we are at the mercy of our customers. So we make 
the best guesstimates that we can, like any other business, and 
we run into that difficulty every now and then.
    Senator Murkowski. So what is your forecast for the 
passports for next year?
    Mr. Tapella. We have not yet received the forecast from the 
State Department. I am hoping that it will be larger than this 
year's. It would be nice if it would get up in the 15 million, 
16 million range. We have dedicated nearly 150 employees just 
to passports, and we have a facility here in Washington, DC. We 
have a facility in Stennis, Mississippi. I think a lot will 
have to do with this next deadline for the western hemisphere 
travel initiative, which goes into effect June 1. That may have 
an effect.
    What we are trying to do is get into new businesses, such 
as Customs and Border Patrol, the NEXUS, SENTRI cards, to try 
to make up for potentially less revenue in the passport 
business.
    Senator Murkowski. We have been pushing--we share a border 
with Canada, and we have been urging Alaskans for the past 18 
months to aggressively get your passport now. I think we 
contributed to some of your business.
    But I would imagine that we are probably on that downhill, 
and I don't know whether it is a stabilization, but I wouldn't 
expect that we would see a continued increase in requests for 
passports. I think that the message that we, as lawmakers, were 
trying to get out, I think they finally got it. And people 
really did get out, and we saw that bump up. But I wonder 
whether it is going to continue at that.
    Mr. Chairman, I had a question about the facilities issues 
and the police force, but I understand that you had an 
opportunity to already ask Mr. Tapella that when I was walking 
back over here. So I don't have any further questions.

             GPO deg.BUSINESS APPLICATIONS AT GPO

    Senator Nelson. I don't know that I have any further 
questions. I guess I would make a comment that maybe that 
representation fund should be expanded because any business 
that would be looking at a downturn on one side of their 
business would be looking for ways to create an upswing on the 
other side of their business.
    And it seems to me that in a day and age when we are 
looking for more transparency, the data, the information, 
everything that you have is valuable to countless numbers of 
groups and others. And it would seem unless you have saturated 
the market out there already, which I rather doubt it, not with 
a $5,000 representation fund, that there would be a market that 
you could go after.
    I don't want to turn the United States Government into a 
business, but certainly there are business applications that 
would be appropriate for what you are doing. So I certainly 
wouldn't be against seeing that fund or that number increasing, 
if you had any thoughts?
    Mr. Tapella. Well, I would agree with you completely. 
Essentially, we are a business or we operate like a business. 
And I actually think it is a good thing. I am not opposed to 
it.
    I think it is important that we be lean and mean like other 
businesses. And there are a lot of opportunities. There are a 
number of things that I believe are inherently governmental 
that are currently being done by private sector vendors that 
are better served in a Government-owned, Government-controlled 
facility, particularly as it relates to security and 
credentials.
    One of the areas that if we had the authority to do, which 
we presently do not have, I would love to be able to use our 
excess capacity in passport production to produce passports for 
other countries. In order to do that, we would have to have 
specific authority or have the State Department host the other 
countries. But that is an area where, for example, we could 
provide some great value, and it would keep our folks gainfully 
employed and fully enabled.
    Senator Nelson. Well, if you have got excess capacity, one 
of the best things that you can do is find a use for it. And 
perhaps you might think about putting a plan of that sort 
together. I am more than happy to continue to talk to you about 
it, and perhaps there is something that could be established to 
do that very thing.
    I don't know whether you--Mr. Dodaro would want to take a 
look at that as well. Certainly, we ought to maximize whatever 
capacity we have, particularly in a down economy.

                  GAO deg.GAO'S PASSPORT WORK

    Mr. Dodaro. We would be happy to take a look at that. We 
have looked at the security surrounding the passports, both in 
terms of being able to get them with falsified documents, as 
well as the securities of the chips that Bob has been talking 
about. So we will be happy to look at the demand issue as well 
for you.
    Senator Nelson. And come up with maybe some path forward on 
what kind of authority would be required. We could take a look 
at it at the very least.
    So, well, I want to thank the witnesses.
    Yes, Senator Murkowski?

              GPO deg.GPO INFORMATION TECHNOLOGY

    Senator Murkowski. I just realized there was one final 
question that I had not----
    Senator Nelson. Sure.
    Senator Murkowski [continuing]. Yet asked. I apologize. And 
this relates, Mr. Tapella, to the information technology 
request, the $18.5 million. It is my understanding that these 
initiatives that are contained in this IT request have been 
requested in prior years, but they haven't been funded.
    Can you let me know why is it important that we do them 
now? What the impact of continuing to defer some or all of 
these to a future year might be? I just want to understand 
because $18.5 million is not unreasonable in terms of a 
technology request. But if you have been able to get by without 
it, what would be the impact of continued deferral?
    Mr. Tapella. Number one, as we have looked at prior year 
requests, we requested typically the amount for the entire 
project. And what we have done is we have broken those down, 
and in many ways, we have funded the first phases of these 
through retained earnings when we didn't receive direct 
appropriations for the purposes.
    As we look at FDsys, the subcommittee previously had been 
very supportive by allowing us to use prior year unobligated 
congressional printing and binding funds and salaries and 
expenses to fund FDsys. And that is the whole reason that we 
were able to release it this year.
    The remaining $8 million we need to complete the 
functionality of FDsys, to take it from where it is today to 
the complete functionality, we still have a 2-year roadmap of 
releases for FDsys. And if we don't have the funding, and 
particularly in GPO's current financial state, we will not have 
the retained earnings to fund it out of our revolving fund, as 
we had in some prior years. So FDsys would probably stop with 
its existing functionality should we not get the funding levels 
we need.
    As it relates to composition replacement system, that is 
something that we use for both Congress and for the Federal 
Register. Those are our prime areas. We have already committed 
the first $2 million for it from our revolving fund, and it was 
retained earnings from the products and services we sell to 
other agencies. We expect the total project to cost $5 million.
    Since we use it significantly for congressional products, 
or at least 50-50, we believe the Congress should be paying for 
their share of it. And actually under the law, they really 
should as well because it falls into the Anti-Deficiency Act in 
terms of using funds for its intended purpose.
    That is going to be done in three releases. The first 
release will be completed about 1 year after the initial award. 
And we are ready to go out with an RFP probably within the next 
month or so. And we have got enough money for this first phase. 
If we don't get the money this year to continue it, it is going 
to go on hold.
    As we look at the Oracle system, we are in an interesting 
situation for our transformation. The transformation began in 
2003 really. We are now 6 years into it, and we have had to 
replace all of our systems. We were on old mainframe systems. 
They are legacy systems. They are no longer supported. And this 
year, we are running in duality. We have our new Oracle system. 
We are still running some mainframe systems. We have the new 
FDsys. We are still running GPO Access.
    When it relates to our financial systems, if we do not have 
the funding to continue Oracle, we are going to have to 
continue basically paying double for our overhead in those 
related areas, and we will not see the benefits of such a 
system. And I think that is really critical.
    As it is, we are probably looking another year or two in 
duality just with where we are in funding levels. And if we 
don't get the funding, it is going to be 4, 5, 6 years, which 
means at the end of the day, you are still paying for it 
because we are going to have to charge more for congressional 
printing and binding if we have significantly greater overhead.
    And so, it is sort of a win-win, lose-lose, you pay one way 
or the other.
    Senator Murkowski. Thank you. Appreciate that, Mr. 
Chairman.
    Senator Nelson. Thank you.
    I want to thank the witnesses today for attending our 
hearing.

                          SUBCOMMITTEE RECESS

    The subcommittee will stand in recess until 2:30 p.m. on 
June 4, 2009, when we will meet to take testimony on the fiscal 
year 2010 budget requests of the Library of Congress and the 
Open World Leadership Center.
    We are recessed.
    [Whereupon, at 4:01 p.m., Thursday, May 21, the 
subcommittee was recessed, to reconvene at 2:30 p.m., Thursday, 
June 4.]
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