Paperwork Reduction Act: Subcommittee Questions Concerning the	 
Act's Information Collection Provisions (19-JUL-05, GAO-05-909R).
                                                                 
This letter responds to Congress' request of June 22, 2005, that 
we provide answers to questions relating to our June 14 testimony
on the Paperwork Reduction Act (PRA). At the June hearing, we	 
discussed the estimates of government paperwork burden provided  
in the annual PRA report (known as the Information Collection	 
Budget) that the Office of Management and Budget (OMB) recently  
released, as well as results from our report on agencies' PRA	 
processes and compliance.					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-05-909R					        
    ACCNO:   A30357						        
  TITLE:     Paperwork Reduction Act: Subcommittee Questions	      
Concerning the Act's Information Collection Provisions		 
     DATE:   07/19/2005 
  SUBJECT:   Government collections				 
	     Government information dissemination		 
	     Chief information officers 			 
	     Data collection					 
	     Federal forms					 
	     Federal law					 
	     Federal regulations				 
	     Information resources management			 
	     Reporting requirements				 
	     Standards						 

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GAO-05-909R

United States Government Accountability Office Washington, DC 20548

July 19, 2005

The Honorable Candice S. Miller
Chair
The Honorable Stephen F. Lynch
Ranking Minority Member
Subcommittee on Regulatory Affairs
Committee on Government Reform
House of Representatives

Subject: Paperwork Reduction Act: Subcommittee Questions Concerning the
Act's Information Collection Provisions

This letter responds to your request of June 22, 2005, that we provide
answers to questions relating to our June 14 testimony1 on the Paperwork
Reduction Act (PRA). At the June hearing, we discussed the estimates of
government paperwork burden provided in the annual PRA report (known as
the Information Collection Budget) that the Office of Management and
Budget (OMB) recently released, as well as results from our report on
agencies' PRA processes and compliance.2 Your questions, along with our
responses, follow.

1.	With the passage of the Paperwork Reduction Act (PRA) of 1995, the
intent of the Congress was to reduce the burden imposed on the public by
federal agencies. Is the PRA in its current form an effective tool for
reducing public burden?

As discussed in our report, the PRA in its current form contains
mechanisms intended to reduce the public burden. Among these is the
requirement that OMB review all information collections, as well as the
requirement put in place by the 1995 amendments to the PRA, that agencies
establish a process to review program offices' proposed collections before
the OMB review. This agency review process is to be carried out by the
official responsible for the act's implementation-now the agency's

1GAO, Paperwork Reduction Act: Burden Reduction May Require a New
Approach, GAO-05-778T
(Washington, D.C.: June 14, 2005).
2GAO, Paperwork Reduction Act: New Approach May Be Needed to Reduce
Government Burden on
Public, GAO-05-424 (Washington, D.C.: May 20, 2005).

          GAO-05-909R Posthearing Questions on Paperwork Reduction Act

Chief Information Officer (CIO)3-who is to be sufficiently independent of
program responsibility to evaluate fairly whether information collections
should be approved. As part of this process, the CIO is to certify that
information collections meet 10 standards set forth in the act, including
that they reduce the burden on the public to the extent practicable and
appropriate.

However, as discussed in our report, the current implementation of this
CIO review offers opportunities for improvement. As the case studies in
our report demonstrate, the review has been reduced to a routine
administrative process, rather than the rigorous analytical process
envisioned by the Congress, and does not appear to be effective in
reducing the burden. Accordingly, we recommended that agency CIOs
strengthen support for certifications, a process that has the potential to
improve the effectiveness of the review mechanism as a means to reduce the
burden. More effective implementation would make the PRA in its current
form a more effective tool for reducing the burden.

In addition, we described more targeted approaches to burden reduction
that have been pursued at the Internal Revenue Service (IRS) and the
Environmental Protection Agency (EPA). Both IRS and EPA have reported
success with these efforts, and we suggested in our report that the
Congress may want to consider mandating the development of pilot projects
to test and review the value of such approaches. However, we also noted
that targeted reviews of the kind that IRS and EPA perform would require
more resources than are now devoted to the CIO review process, and may not
be warranted at agencies that do not have the extensive paperwork issues
that these two agencies have.

2. True reductions in the burden should take place due to program
changes-either statutory or agency-initiated. Additionally, certain
adjustments, such as those caused by the decreased burden associated with
subsequent collections following the initial request, can reflect a real
change in the burden experienced by the public.

Federal agencies may use adjustments to lessen the true burden increases
caused by discretionary agency actions. How can current law be modified to
ensure that agencies engage in activities that truly reduce the burden
through discretionary program changes and not through simple adjustments?

First, there may be opportunities to achieve such burden reduction without
modifications to the law. Under the current law, agency CIOs are required
to certify that for each information collection, the agency has reduced
the associated burden to the extent practicable. However, as we describe
in our response to question 1, the certification process is currently more
administrative than analytical. Improving the

3The 1995 amendments used the 1980 act's reference to the agency "senior
official" responsible for implementation of the act. A year later, the
Congress gave that official the title of agency Chief Information Officer
(the Information Technology Management Reform Act, Pub. L. 104-106, Feb.
10, 1996, which was subsequently renamed the Clinger-Cohen Act, Pub. L.
104-208, Sept. 30, 1996).

execution of this process could increase agencies' activities to reduce
the burden through program changes.

A second way to potentially achieve such burden reductions-which does
involve changes to the PRA-was discussed in our report. The Congress could
consider mandating the establishment of pilot projects to test and review
the targeted approaches to burden reduction used by IRS and EPA. Such
pilot projects would encourage agencies to explore different possible
activities having the potential to truly reduce the burden. However, as
mentioned earlier, targeted reviews of the kind that IRS and EPA do would
require more resources than are now devoted to the CIO review process, and
may not be warranted at agencies with less extensive paperwork issues than
there is at these two agencies.4

3. As the Congress considers reauthorization of the PRA, what changes to
the information collection requirements of the act should the Congress
consider?

In our report, we identified two changes that we believe the Congress
should consider. First, we suggested that the Congress consider amending
the act to mandate pilot projects similar to the targeted efforts being
implemented by IRS and EPA and to measure and evaluate the success of
these projects. Second, we suggest that the Congress consider eliminating
the additional public comment period (the 60day notice) added by the 1995
amendments (see the answer to question 8). In addition, in light of the
lack of understanding of the current PRA requirement that public
consultation occur on all collections, the Congress might consider
clarifying what level of public consultation it expects for new and
existing collections (see the answer to question 9).

4. The GAO recommends the Director of the Office of Management and Budget
(OMB) take five actions to improve agency compliance with the PRA.
Furthermore, the GAO recommends five actions to be undertaken by the
agencies subject to its investigation. What actions could the Congress
take to ensure these recommendations are realized by agencies
governmentwide?

Some of the actions we recommended to OMB would, if implemented, have
governmentwide impact, such as clarifying its guidance in various ways and
directing agencies to review forms on agency Web sites for PRA compliance.
As part of our standard processes, we systematically follow up on
recommendations and make information on their status available to the
Congress. Accordingly, we will be reviewing the actions of OMB and the
other agencies to respond to our recommendations. In addition, the
Congress could continue to hold regular oversight hearings where it could
monitor follow-up on our recommendations and their governmentwide effect.

4IRS and six other agencies account for more than 90 percent of the
federal burden; thus, relatively small reductions in the burden imposed by
these agencies could have a major effect on reducing the paperwork burden
governmentwide.

5. What are some problems associated with specific burden reduction goals,
such as those mandated by the 1995 PRA? How can the Congress mandate
specific burden reductions caused by agency-initiated program changes?

A major problem associated with these goals is that, so far, they have not
produced the intended results. We commented in our testimony on the
government's lack of success in meeting the specific burden reductions
mandated by the 1995 PRA. Our recommendation that the CIO review process
be strengthened is one possible approach to improving agencies' success in
reducing the burden.

A second problem is the intrinsic difficulty of accurately estimating the
burden. As we said in our testimony, "Because of limitations in the
ability to develop accurate burden estimates, the degree to which agency
burden-hour estimates reflect the real burden is unclear." It is
challenging to estimate the amount of time it will take for a respondent
to collect and provide the information or how many individuals an
information collection will affect.5 OMB's latest report6 on the paperwork
burden also alludes to this difficulty, observing with regard to IRS that
"... in an effort to more accurately measure the paperwork burden, IRS is
currently evaluating its current methodology which, although vastly more
sophisticated than that used by most federal agencies, has recognized
shortcomings. The current methodology is based on survey data almost 20
years old and measures only certain types of taxpayer compliance burdens.
It has limited ability to predict changes in the compliance burden
resulting from changes in tax policy or tax system administration."

In regard to mandating specific burden reductions, we made a related
suggestion in our report. Specifically, we suggested that the Congress may
wish to mandate the development of pilot projects to test and review the
value of approaches such as those used by IRS and EPA. As part of this
pilot, agencies could identify specific burden reduction goals for the
targeted collections and report on reductions achieved.

6. The Administrator of OMB's Office of Information and Regulatory Affairs
(OIRA) stated that OMB is considering changing instructions for agencies
to align them more closely to the 10 standards in the PRA. How can the
Congress ensure that any proposed revisions to OMB guidance are aligned
with relevant statutes, either existing or new?

As part of our standard recommendation follow-up, we will be reviewing
OMB's actions to revise its guidance in the ways we recommended, and we
will make the results of this follow-up available to the Congress. The
Congress could also continue to hold regular oversight hearings where it
could monitor OMB's actions.

5See GAO, EPA Paperwork: Burden Estimate Increasing Despite Reduction
Claims, GAO/GGD-00-59 (Washington, D.C.: Mar. 16, 2000) for how one agency
estimates the paperwork burden. 6Office of Management and Budget, Office
of Information and Regulatory Affairs, Managing Information Collection:
Information Collection Budget of the United States Government, Fiscal Year
2005 (May 2005), http://www.whitehouse.gov/omb/inforeg/2005_icb_final.pdf.

7. Has the PRA been effective in facilitating communication between
federal agencies and the public as information collections are developed
and reviewed? Are there any provisions of the PRA that agencies have cited
as being a disincentive to reach out to the public?

Although the act provides mechanisms to encourage communication between
federal agencies and the public, the implementation of these mechanisms
could be more effective. That is, the act explicitly states in section
3506 (c)(2)(A) that, in addition to providing a 60-day notice in the
Federal Register, each agency shall otherwise consult with members of the
public and affected agencies concerning each proposed collection of
information. However, agencies have not complied with this requirement. We
reported that a key reason for this noncompliance is OMB's guidance that
such consultation is optional. According to this guidance, agencies should
"otherwise consult," or affirmatively reach out to the public, only on
those collections that OMB says "deserve such effort." As we stated in our
report, if agencies do not actively consult with the public, they limit
their ability to determine whether proposed collections adequately satisfy
the act's standards. As a result, their collections may be unnecessarily
burdensome because of lack of clarity, unnecessarily onerous recordkeeping
requirements, or other reasons.

We also concluded that the 60-day Federal Register comment period has had
limited effectiveness in obtaining the views of the public. As we
reported, most agencies provided the required 60-day Federal Register
notice, but only an estimated 7 percent of those notices generated one or
more comments. We believe the Federal Register notice is not effective in
facilitating communication between federal agencies and the public because
it generates so few comments. Moreover, in the act's second required
Federal Register notice, the public has another opportunity to provide its
views. For these reasons, other types of consultation are important and
should be encouraged. For example, some agencies post proposed collections
on their Web sites and ask the public to comment. Similarly, OMB could
establish links on its Web site to each agency's proposed collections (as
is done with agencies' proposed regulations on (www.regulations.gov) and
ask for public comments.

Agencies have cited another disincentive to undertaking active
consultation: The act defines a collection of information requiring
approval as the obtaining of facts or opinions by an agency that calls for
answers to identical questions posed to 10 or more persons. According to
agencies, this 10-person provision restricts their ability to consult with
the public on their proposed information collection requests. We reported
in 2000, for example, that EPA officials "noted that the extent and nature
of the agency's public consultations is limited by the PRA's requirements.
. . . A survey or a series of meetings with 10 or more potential
respondents to a proposed information collection would itself constitute a
collection of information, thereby triggering the [OMB] approval process
and adding the burden associated with the collection to the agency's
total."7 OMB's instructions to agencies acknowledge this constraint and
state that "agencies should not conduct special surveys to obtain

7GAO/GGD-00-59, 23.

information on which to base hour burden estimates. Consultation with a
sample (fewer than 10) of potential respondents is desirable."

However, OMB has the option of developing alternatives to allow agencies
to consult on these matters. For example, it could devise and approve a
standard public consultation survey asking for responses to proposals for
(or renewals of) information collections that agencies could use without
further OMB approval.

8. In its report, the GAO suggests that the Congress may want to consider
eliminating the requirement that agencies publish an initial 60-day notice
in the Federal Register for proposed collections. Can you elaborate on
this suggestion? Would eliminating the required 60-day notice decrease
public involvement in the development of an agency's information
collection? Is there a legislative alternative to eliminating the 60-day
notice requirement? For example, how could the Congress change existing
law to create an exemption for routine information collections and/or for
collections that impose a minimal amount of burden on the public?

Our suggestion that the Congress consider eliminating the publication of
the initial 60-day notice in the Federal Register is based on our
observation that this notice had limited effectiveness in generating
public involvement. (We did not analyze the responses generated by the
second 30-day Federal Register notice as part of our review.) In our view,
eliminating this notice would not, therefore, appreciably decrease public
involvement in the development of information collections. If agencies
instead performed other types of consultation, as we recommended, we see
the potential for a net increase in public involvement.8

If the Congress chooses not to eliminate this notice, it could create
exemptions for certain types of collections, such as extensions (currently
approved collections that are being extended with no change) or
"voluntary" collections (that is, where the public is under no obligation
to respond; for these, agencies have an incentive to minimize burden so as
to encourage the public to respond when there is no legal obligation to do
so). Alternatively, the Congress could create an exemption for proposed
collections that impose a minimal number of burden hours or affect only a
small number of respondents. Such exemptions could free up agency
resources that could be devoted to improving compliance on more
significant collections. We have not studied the relative merits of these
alternatives, however.

9. In the GAO report, OMB and three agencies disagreed with GAO's
assertion that public consultation occur on each collection in addition to
the required 60-day Federal Register notice. The Department of Labor's CIO
expressed concern that additional public consultation, particularly for
routine renewals of collections,

8Other types of consultation might include holding meetings with
representative groups, posting information on Web sites, and so on. For
example, IRS convenes periodic meetings between its personnel and
representatives of the American Bar Association, the National Society of
Public Accountants, the American Institute of Certified Public
Accountants, and other professional groups to discuss tax law and tax
forms. During these meetings there are opportunities for those attending
to make comments on forms used for information collection.

would not be a good use of agency resources.

If the Congress were to consider altering this particular provision to
improve its effectiveness as a tool to improve public consultation, can
legislative corrections be made to differentiate between significant
collections and routine collections and/or collections that impose a
minimal amount of burden? If so, how can the Congress modify the PRA to
facilitate public outreach without forcing agencies to spend valuable
resources engaging in such activities for routine information collections
or when such actions are considered unnecessary?

If the Congress wants to alter the existing public consultation
requirements in the PRA, it has various alternatives for creating
exemptions. For example, it could create an exemption for certain types of
collections, such as extensions of currently approved collections or
voluntary collections. Alternatively, the Congress could create an
exemption for proposed collections that impose a minimal amount of burden
on the public or affect only a small number of respondents. We have not
studied the relative merits of these alternatives, however.

                       Agency Comments and Our Evaluation

We provided a draft of this letter to OMB officials for comment. The Chief
for the Health, Transportation and General Government Branch in OMB's
Office of Information and Regulatory Affairs stated that OMB had no
comments.

------In responding to these questions, we relied on past work related to
our review of agencies' processes for reviewing paperwork collections
under the act. We conducted our work in accordance with generally accepted
government auditing standards during June and July 2005.

We are sending copies of this letter to the Director of OMB and to other
interested parties. Copies will also available at no charge at our Web
site at www.gao.gov.

Should you or your offices have any questions on matters discussed in this
letter,
please contact me at (202) 512-6240 or by e-mail at [email protected].
Contact points
for our Offices of Congressional Relations and Public Affairs may be found
on the last
page of this report. GAO staff who made major contributions to this
correspondence
include Al Stapleton, Assistant Director; Barbara Collier; Nancy Glover;
David
Plocher; and Warren Smith.

Linda D. Koontz
Director, Information Management Issues

(310742)

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