National Labor Relations Board: Observations on the NLRB's July 8, 1997,
Draft Strategic Plan (Testimony, 07/24/97, GAO/T-HEHS-97-183).

GAO discussed the National Labor Relations Board's (NLRB) strategic plan
required by the Government Performance and Results Act.

GAO noted that: (1) although NLRB's plan is a work in progress, the July
8, 1997 version has deficiencies in several critical areas and often
omits important information required by the Results Act; (2) for
example, the plan's mission statement clearly articulates neither the
purpose of NLRB's various functions nor how it performs its work; (3)
moreover, although the plan's long -term goals are linked to its mission
statement, its goals and objectives are neither results oriented nor
measurable as stated; (4) NLRB has consulted with key stakeholder groups
such as unions, employees, and NLRB employees; however, it has not
consulted with the Congress; (5) NLRB's draft plan includes no
description of the strategies or initiatives that will be used to
achieve the plan's strategic goals, has no information on the time
schedule or resources required by key actions associated with the plan's
progress, and omits three of the six basic elements required by the
Results Act; and (6) NLRB officials have acknowledged these deficiencies
and are further revising the plan.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-97-183
     TITLE:  National Labor Relations Board: Observations on the NLRB's 
             July 8, 1997, Draft Strategic Plan
      DATE:  07/24/97
   SUBJECT:  Strategic planning
             Agency missions
             Reporting requirements
             Collective bargaining
             Information resources management
             Congressional/executive relations
             Program evaluation
             Labor negotiations
             Management information systems

             
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Cover
================================================================ COVER


Before the Subcommittee on Human Resources, Committee on Government
Reform and Oversight
House of Representatives

For Release on Delivery
Expected at 11:00 a.m.
Thursday, July 24, 1997

NATIONAL LABOR RELATIONS BOARD -
OBSERVATIONS ON THE NLRB'S JULY 8,
1997, DRAFT STRATEGIC PLAN

Statement of Carlotta C.  Joyner, Director
Education and Employment Issues
Health, Education, and Human Services Division

GAO/T-HEHS-97-183

GAO/HEHS-97-183T


(205349)


Abbreviations
=============================================================== ABBREV

  ALJ - administrative law judge
  NLRB - National Labor Relations Board
  OMB - Office of Management and Budget

NATIONAL LABOR RELATIONS BOARD: 
OBSERVATIONS ON THE NLRB'S JULY 8,
1977, DRAFT STRATEGIC PLAN
============================================================ Chapter 0

Mr.  Chairman and Members of the Subcommittee: 

We are pleased to be here today to discuss the National Labor
Relations Board's (NLRB) strategic plan required by the Government
Performance and Results Act of 1993 (the Results Act). 

NLRB is an independent agency created by the National Labor Relations
Act of 1935.  As amended, the act provides the basic framework for
relations between labor and businesses engaged in interstate
commerce.  It defines and protects rights of employees and employers,
encourages collective bargaining, and seeks to eliminate certain
unfair labor practices that could interrupt commerce.  The act covers
both profit and nonprofit firms.  Major exemptions include
agricultural laborers, supervisors, and public employees. 

My comments today will focus primarily on NLRB's July 8, 1997, draft
strategic plan.  As you requested, we determined whether the draft
plan complied with the requirements of the Results Act and the Office
of Management and Budget's (OMB) guidance on developing strategic
plans (Circular A-11, Part 2).  To judge the overall quality of the
plan and its components, we used our May 1997 guidance for
congressional review of the plans (GAO/GGD-10.1.16, May 1997).\1 We
also relied on previous reviews we have conducted on the Results Act
and at NLRB.  A list of related GAO products appears at the end of
this testimony. 

Agency strategic plans are to provide the framework for implementing
all other parts of the Results Act, and they are a key part of
improving performance.  The act anticipated that it might take
several planning cycles to perfect the process, however, and that the
final plan would be continually refined as future planning cycles
occur.  Agencies are not required by the Results Act to have final
strategic plans until September 30, 1997.  We recognize that
developing a strategic plan is a dynamic process and that the draft
plan we reviewed will be further revised before NLRB submits its
final plan to the Congress in September 1997. 

In summary, although NLRB's plan is a work in progress, the July 8
version has deficiencies in several critical areas and often omits
important information required by the act.  For example, the plan's
mission statement clearly articulates neither the purpose of NLRB's
various functions nor how it performs its work.  Moreover, although
the plan's long-term goals are linked to its mission statement, its
goals and objectives are neither results oriented nor measurable as
stated.  The agency has consulted with key stakeholder groups, such
as unions, employers, and the agency's employees; however, it has not
yet consulted with the Congress.  Finally, NLRB's draft plan includes
no description of the strategies or initiatives that will be used to
achieve the plan's strategic goals, has no information on the time
schedule or resources required by key actions associated with the
plan's progress, and omits three of the six basic elements required
by the Results Act.  NLRB officials have acknowledged these
deficiencies and are further revising the plan. 


--------------------
\1 Agencies' Strategic Plans Under GPRA:  Key Questions to Facilitate
Congressional Review (GAO/GGD-10.1.16, May 1997). 


   BACKGROUND
---------------------------------------------------------- Chapter 0:1

The purpose of the National Labor Relations Act is to encourage
collective bargaining and to protect workers exercising their freedom
of association to negotiate the terms and conditions of their
employment.  To carry out this responsibility, NLRB performs
electoral, investigative, prosecutorial, and judicial functions. 
These functions are divided between its Office of General Counsel and
a five-member Board appointed by the President with Senate approval. 

NLRB's Office of General Counsel, organized into 52 field offices in
33 regions, conducts representation elections,\2 investigates and
resolves cases involving disagreements about elections, and
investigates and prosecutes cases involving unfair labor practices. 
All cases originate in one of the regional offices, either with a
party filing a charge alleging an unfair labor practice or with a
party filing a petition for an election.  At the regional level,
parties to the case either settle informally--the case is withdrawn,
dismissed, or settled--or pursue litigation.  Cases that the Office
of General Counsel's regional staff determine have merit as an unfair
labor practice usually involve a hearing before an administrative law
judge (ALJ) in the region, who decides the case.  Litigation in
representation cases usually involves a hearing before a hearing
officer, followed by a regional director's decision.  If the parties
to a case concur with the ALJ or regional director decision, this
decision becomes the NLRB decision. 

If parties contest the regional decision, the five-member Board at
NLRB headquarters reviews the case and decides to affirm, modify, or
reverse the regional decision.  For decision-making purposes, the
Board organizes itself into five three-member panels.  One Board
member serves as the head of each panel, is assigned the case, and
drafts the Board's decision.  Most Board decisions are made by the
three-member panels rather than by the entire five-member Board. 
Parties (except for the General Counsel) who disagree with the
Board's decision may appeal unfair labor practice cases, but
generally not representation cases, to a U.S.  circuit court of
appeals and, in turn, to the Supreme Court. 

In fiscal year 1997, NLRB's budget of about $175 million authorized
1,950 full-time-equivalent positions in its Washington headquarters
and field offices.  In addition to 200,000 inquiries a year from the
public, NLRB receives for investigation about 40,000 cases a year
filed by individuals, employers, or unions.  The vast majority of all
cases filed with NLRB are resolved informally at the regional level,
and most of these are resolved without going to an ALJ or the
regional director for a decision.  The remaining cases are forwarded
for review to the five-member Board at NLRB headquarters. 


--------------------
\2 Representation elections are elections conducted among workers to
determine whether they wish to be represented by a union. 


      RESULTS ACT REQUIREMENTS FOR
      PREPARING AGENCY STRATEGIC
      PLANS
-------------------------------------------------------- Chapter 0:1.1

The Results Act requires that agencies clearly define their missions
and articulate a comprehensive mission statement that covers the
agency's major functions and operations.  It also requires that they
establish long-term strategic goals, as well as annual goals linked
to them.  Agencies must then measure their performance in meeting the
goals they have set and report publicly on their progress.  In
addition to monitoring ongoing performance, agencies are expected to
perform discrete evaluations of their programs and to use information
from these evaluations to improve the programs. 

The Results Act requires agency strategic plans to include the
following six elements: 

  -- Mission statement:  A comprehensive mission statement covering
     the major functions and operations of the agency. 

  -- Strategic goals:  A description of general goals and objectives
     for the major functions and operations of the agency. 

  -- Strategies to meet goals:  A discussion of the approaches (or
     strategies) to achieve the goals and objectives and the
     resources needed. 

  -- Relationship of strategic goals to performance goals:  A
     description of the relationship between the general goals and
     objectives in the strategic plan and the performance goals in
     the annual performance plan. 

  -- External constraints:  A discussion of key factors external to
     the agency that could significantly affect achieving the
     strategic goals. 

  -- Program evaluations:  A description of program evaluations used
     to establish or revise strategic goals and objectives and a
     schedule for future evaluations. 

The plan is to cover a period of not less than 5 years and is to be
updated every 3 years.  The act requires agencies, as they develop
their strategic plans, to consult with the Congress and solicit the
views of other key stakeholders. 

OMB Circular A-11 provides guidance to agencies on preparing
strategic plans, including a description of individual components to
be included in such plans.  In addition, the circular provides
information on developing annual performance plans and a schedule by
which all plans must be completed and sent to OMB and the Congress. 


   STRATEGIC PLAN'S MISSION
   STATEMENT COULD BE STRENGTHENED
---------------------------------------------------------- Chapter 0:2

According to OMB Circular A-11, the mission statement in a strategic
plan should be brief, defining the basic purpose of the agency, with
particular focus on its core programs and activities.  High-quality
mission statements often explain why the agency exists, what it does,
and how it performs its work. 

NLRB's stated mission in its draft strategic plan is to "(a)
determine and implement through secret ballot elections, the free
democratic choice by employees as to whether they wish to be
represented by a union in dealing with their employers and, if so, by
which union; (b) prevent and remedy unlawful acts, called unfair
labor practices, by either employers or unions or both; and (c)
insure that the process of collective bargaining is available and
unimpeded."

Although the statement accurately itemizes the functions required by
the statute, it does not clearly articulate what those functions are
intended to achieve.  For example, the statement does not focus on
the results expected from activities, such as conducting elections,
that is, how workplaces would be different if such elections occurred
freely.  In addition, a statement about ensuring that the process of
collective bargaining is available and unimpeded is vague without
further clarification of which NLRB activities would address this
part of its mission and what would result from achieving this. 
Similarly, the statement says that NLRB will prevent and remedy
unlawful acts but does not convey which agency activities would
perform this function. 


   STRATEGIC PLAN'S GOALS LINKED
   TO AGENCY'S MISSION BUT NOT
   RESULTS ORIENTED
---------------------------------------------------------- Chapter 0:3

The plan's long-term goals are generally linked logically to its
mission statement.  For example, the first three of the plan's five
goals concern the expeditious and effective resolution of
representation questions and unfair labor practices and vigorous
pursuit of court orders and judgments to obtain redress.  All of
these are logically linked to a mission statement aimed at
facilitating employees' free choice in determining union
representation, preventing and remedying unfair labor practices and
ensuring that the collective bargaining process is available and
unimpeded.  The remaining goals concern the agency's desire to
implement effective management practices--maintaining a well-trained
workforce and providing it the technological capabilities to ensure
productivity--that would help achieve its mission. 

Unfortunately, the objectives associated with each of the goals are
simply extended restatements of the strategic goals, rather than more
specific explanations of what the goals are intended to accomplish. 
For example, one of the plan's goals is that "the NLRB will resolve
questions concerning representation expeditiously and effectively."
The associated objective states that "the NLRB seeks to effectively
protect the rights of employees to select or reject a labor
organization as their collective bargaining representative.  To this
end, it is essential that the NLRB resolve all questions concerning
representation and conduct representation elections fairly and as
expeditiously as possible." In addition, the goals and objectives as
stated are generally neither results oriented nor measurable.  For
example, the goals tend to focus on the process, such as resolving
questions, and how it will be done, that is, expeditiously and
effectively, rather than on the result, such as workplaces where the
free and democratic choice of employees can be expressed.  In
addition, the goals are not readily measurable without clarification
of the meaning of terms such as "effective."


   STRATEGIES TO ACHIEVE GOALS ARE
   IDENTIFIED BUT NOT DESCRIBED
---------------------------------------------------------- Chapter 0:4

The Results Act specifies that agencies describe the means by which
they will achieve the general goals and objectives and the various
resources needed.  This can include operational processes, skills,
technologies, and other resources.  The current version of the NLRB
strategic plan mentions proposed strategies to achieve each objective
but does not describe them nor articulate the linkage between the
strategy and the particular goal and in one instance does not even
identify a strategy.  For example, it lists strategies such as "super
panels" to achieve the goal concerning representation elections
without describing them or their relevance.\3 Earlier versions of the
agency's strategic plan had more detail on the agency's proposed
strategies, and agency officials have told us that they are
continuing to develop this area internally. 

In addition, OMB Circular A-11 requires that agencies include
schedules and the levels of resources necessary to complete key
actions.  The current agency plan, however, has no information on the
time schedule or resources required by key actions associated with
the plan's progress, for example, the development or use of "case
management data research tools" or the resources associated with the
completion of its case activity tracking system, which is discussed
later in my statement. 


--------------------
\3 Under a super panel procedure, a panel of three Board members
meets each week to hear cases that involve issues that lend
themselves to quick resolution without written analyses by each Board
member's staff. 


   PLAN OMITS THREE REQUIRED
   COMPONENTS
---------------------------------------------------------- Chapter 0:5

NLRB's draft strategic plan omits three of the six components
required by the Results Act and OMB Circular A-11.  More
specifically, the plan does not discuss (1) the relationship between
its long-term goals and annual performance goals, (2) outside factors
or external constraints that could hinder or affect the agency's
efforts to achieve its goals, and (3) role of program evaluation in
developing the plan or establishing goals. 

The Results Act requires agencies to establish annual performance
goals linked to the plan's long-term strategic goals.  These annual
goals are to appear in an annual performance plan that the agencies
must prepare beginning in February 1998 and submit to the Congress. 
OMB Circular A-11 notes that the agency strategic plan should include
the type and nature of the goals to be included in the annual plan,
the relationship between the annual plan goals and the general goals
and objectives of the strategic plan, and the relevance of the annual
goals in reaching the overall goals and objectives.  Agencies must
then measure their performance toward the goals they have set and
report publicly, in subsequent years, on their progress. 
Results-oriented annual performance goals can enable the agency to
track its progress closely and adjust the strategic plan when
necessary.  NLRB officials are currently revising the performance
measures proposed in an earlier draft, they said, and anticipate
addressing this issue in future versions of the agency's strategic
plan. 

In addition, NLRB's strategic plan does not discuss external factors
that affect the agency's ability to achieve its objectives.  OMB
Circular A-11 notes that strategic plans should briefly describe key
external factors, indicate their link with particular goals, and
describe the factors' effect on meeting that goal.  Identifying and
assessing such key factors would have particular relevance for NLRB,
an agency whose workload is influenced by general economic
conditions; changes in the nature of work and workforce demographics;
and the needs of stakeholders such as workers, unions, and employers. 

Finally, one of the purposes of the Results Act is to improve
decision-
making by providing reliable information on the extent to which
programs are fulfilling their statutory responsibilities.  Program
evaluations can be an important source of information for ensuring
the validity and reasonableness of goals.  Evaluation information can
also be useful in explaining results in the agency's annual
performance reports, including, when applicable, the reasons annual
goals were not met and identifying appropriate strategies to meet
unmet goals.  According to the Results Act, an agency's strategic
plan should describe the program evaluations used in establishing or
revising goals and objectives and include a schedule for future
program evaluations.  NLRB's strategic plan neither describes the
program evaluations used in preparing the strategic plan nor includes
a schedule for future program evaluations. 


   CONSULTATION WITH KEY
   STAKEHOLDERS HAS NOT INCLUDED
   THE CONGRESS
---------------------------------------------------------- Chapter 0:6

In developing a strategic plan, the Results Act requires that
agencies consult with the Congress and solicit and consider the views
and input from other key stakeholders.  NLRB's strategic plan does
describe the agency's efforts to obtain information from its
stakeholders (unions and employers) to determine their satisfaction
with its services.  The agency has also obtained input from regular
meetings with labor-management advisory panels, which are composed of
labor and management practitioners who appear before the agency and
use the agency's services, on changes in agency procedures that could
expedite case processing and improve agency services.  Finally, the
agency plan acknowledges valuable input from regular consultations
with the labor organizations that represent its own employees as well
as with its managers and supervisors on improvements in work process,
including issues of quality.  The plan, however, provides no
indication that NLRB has consulted with the Congress in its
development, and agency officials said that they have not yet done
so. 


   STRATEGIC PLAN RECOGNIZES
   MANAGEMENT CHALLENGES FACING
   THE AGENCY
---------------------------------------------------------- Chapter 0:7

NLRB's strategic plan does identify several key challenges facing the
agency, including difficulties in managing a large caseload and
weaknesses in its management information systems.  However, regarding
its management information system, the plan does not link the
development of performance measures with the development of a new
management information system.  The result is that potential
incompatibilities between the two could impede accurately measuring
progress toward the strategic goals.  The plan could also be improved
by acknowledging several additional issues:  the year 2000 computer
problem, computer security, and financial management. 


      CASELOAD MANAGEMENT
-------------------------------------------------------- Chapter 0:7.1

NLRB's strategic plan recognizes that combining timeliness in
reducing caseload backlogs with fairness and quality continues to be
one of the main challenges facing the agency.  Our past work on
NLRB's case management supports this.\4 In 1991, we reported that
NLRB's regional offices resolved the vast majority of cases within 1
year.  During the mid- and late-1980s, the five-member Board decided
about 67 percent of the 5,000 cases forwarded to it within 1 year
from the date a case was assigned to a Board member.  About 10
percent of the cases decided by the Board, however, took from about 3
to 7 years to decide.  We recommended in January 1991 that to help
improve the timeliness of its case processing, NLRB should (1)
establish standards for the total length of time a case should be at
the Board and a time for each decision stage at headquarters that,
when exceeded, requires corrective action\5 and (2) specify the
corrective actions that Board members and staff should take when
those targets are exceeded. 

In response to our recommendations, the Board set 2 years as a
benchmark as the outside limit for issuing a decision at the Board
and 6 months as the maximum time for each decision stage.  Also, the
Board revised its case management procedures to directly involve all
Board members in matters that may be emerging as problem cases at the
Board level requiring special attention.  According to Board
officials, these actions, together with other factors, resulted in
significantly reducing the number and percent of Board-decided cases
that were more than 2 years old.  At the end of fiscal year 1991, 7
cases--2 percent of all cases--were pending before the Board for more
than 2 years compared with 60 cases--
16 percent of all cases--that were pending at the end of fiscal year
1989.  At the end of fiscal years 1992 and 1993, the percent of
unfair labor practice cases pending at the Board for more than 2
years was 3 and 4 percent, respectively, and the percent of
representation cases was 1 and 3 percent, respectively. 

Although processing times for representation cases at the Board level
and in the regions have remained stable, NLRB has not sustained its
improved case-processing times for unfair labor practice cases.  At
the Board, the percent of unfair labor practice cases pending for
more than 2 years at the end of fiscal year 1994 rose to 8 percent
and, at the end of fiscal year 1996, to 15 percent--to a level almost
as high as in fiscal year 1989.  At the regional level, the number of
unfair labor practice cases awaiting preliminary investigation to
determine whether a case had merit increased from 3,555 cases at the
end of fiscal year 1991 to 5,219 cases at the end of fiscal year
1995.  Almost one-half of the 5,219 cases exceeded NLRB's 45-day
benchmark for preliminary investigations to take place.  The median
processing time in the regions for closing unfair labor practice
cases increased from 58 days from filing to closing in fiscal year
1990 to 72 days in fiscal year 1995. 

In 1996, we found that NLRB had initiated additional efforts to
improve its performance.\6 For example, at the regional level, NLRB
consulted with an advisory panel of management and labor attorneys to
discuss possible actions for expediting cases, used impact analysis
to allocate resources to cases with the greatest scope and effect,
and developed efforts, such as alternative investigative techniques,
to lighten the regional workload.  At the Board level, NLRB focused
on lead cases\7 to reduce the backlog of related cases and
implemented "speed teams" to expedite Board decisions on easier
cases.\8


--------------------
\4 National Labor Relations Board:  Action Needed to Improve
Case-Processing Time at Headquarters (GAO/HRD-91-29, Jan.  7, 1991). 

\5 To decide cases, the five-member Board uses a three-step process. 
The Board refers to the steps as stages I, II, and III.  In stage I,
a preliminary decision is reached on whether to accept, modify, or
reject the regional decision.  In stage II, Board staff draft the
proposed Board decision.  In stage III, the draft decision circulates
to the Board members who approve, modify, or dissent to the proposed
decision. 

\6 We obtained this information for an informal briefing for the
staff of a congressional committee. 

\7 When several undecided cases deal with the same issue, the Board
selects one case to serve as the principal or lead case and suspends
further processing on all related cases until the lead case is
decided. 

\8 For cases involving straightforward issues, the three-member panel
to which the case is assigned for drafting the Board's decision may
agree to draft and circulate the proposed decision without preparing
the detailed documentation that typically is required. 


      INFORMATION SYSTEMS
-------------------------------------------------------- Chapter 0:7.2

Regarding its management information systems, the plan acknowledges
the management challenge posed by NLRB's weak systems, noting that
its multiple, independent systems do not adequately support the
agency's need for prompt and accurate information to effectively
manage its caseload.  NLRB has several systems that enable tracking
cases at different stages of processing.  No single system, however,
can track all cases from the initial charge until their final
resolution.  A single unified system could facilitate efficiencies in
tracking cases and in resolving cases quickly.  The plan notes that
the agency is continuing to develop the case activity tracking system
that is expected to be completed in 2 years, pending resource
availability.  This system is expected to facilitate case-related
research and make it possible to conduct other important aspects of
case processing with greater efficiency, increasing productivity. 

In recognition of the need for information management improvements,
NLRB's plan includes a strategic goal to integrate information
resource management into the working environment to more efficiently
and effectively meet NLRB's core missions.  As discussed earlier,
however, while proposed strategies to reach this goal are mentioned
in the plan, these strategies are not described.  An additional
problem is that the plan does not indicate any coordination between
developing its case activity tracking system and creating
well-defined, results-oriented performance measures.  To the extent
that the measures developed by the agency as part of its strategic
plan and annual performance plans are inconsistent with the data
collected by its new information system, that system would have to be
retrofitted to allow measuring progress toward the agency's strategic
goals.  Finally, the plan also omits strategies to address other
important information management challenges, such as changing
computer systems to accommodate dates beyond the year 1999--called
the year 2000 problem--as well as any significant information
security weaknesses--
two issues that we have identified as high risk governmentwide.\9

Finally, NLRB is not required by law to prepare financial statements
and have them audited.  Preliminary work from our governmentwide
audit effort, however, has determined that the agency would profit
from a single, integrated financial management system instead of the
five systems the agency currently uses.  Such a system would enable
NLRB to collect reliable and timely information on the full cost of
its programs and activities.  Because NLRB's strategic plan does not
detail the range of data to be collected in its case activity
tracking system, we cannot say whether an improved cost accounting
system should be part of that initiative, but it may be useful for
the agency to consider such integration as it reviews its management
information systems generally. 


--------------------
\9 GAO High-Risk Series (GAO/HR-97-2, Feb.  1997). 


-------------------------------------------------------- Chapter 0:7.3

As I previously stated, NLRB's strategic plan is a work in progress. 
We discussed our observations with Board officials in preparing for
this hearing, and they agreed on the need for improvements in the
draft plan we reviewed.  The officials said they are continuing to
revise the draft plan so that it will conform with the Results Act
and OMB Circular A-11 requirements. 

Mr.  Chairman, this concludes my prepared statement.  I will be happy
to answer any questions that you or other members of the Subcommittee
may have. 


RELATED GAO PRODUCTS
=========================================================== Appendix 1

The Government Performance and Results Act:  1997 Governmentwide
Implementation Will Be Uneven (GAO/GGD-97-109, June 2, 1997). 

Agencies' Strategic Plans Under GPRA:  Key Questions to Facilitate
Congressional Review (GAO/GGD-10.1.16, May 1997). 

Executive Guide:  Effectively Implementing the Government Performance
and Results Act (GAO/GGD-96-118, June 1996). 

Managing for Results:  Achieving GPRA's Objectives Requires Strong
Congressional Role (GAO/T-GGD-96-79, Mar.  6, 1996). 

National Labor Relations Board:  Action Needed to Improve
Case-Processing Time at Headquarters (GAO/HRD-91-29, Jan.  7, 1991). 

Actions Needed to Improve Case Processing Time at National Labor
Relations Board Headquarters (GAO/T-HRD-91-1, Oct.  3, 1990). 


*** End of document. ***