[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]
FEDERAL INFORMATION TECHNOLOGY MODERNIZATION: ASSESSING COMPLIANCE WITH
THE GOVERNMENT PAPERWORK ELIMINATION ACT
=======================================================================
HEARING
before the
COMMITTEE ON
GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
JUNE 21, 2001
__________
Serial No. 107-35
__________
Printed for the use of the Committee on Government Reform
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
_______
U.S. GOVERNMENT PRINTING OFFICE
77-192 WASHINGTON : 2001
____________________________________________________________________________
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COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut MAJOR R. OWENS, New York
ILEANA ROS-LEHTINEN, Florida EDOLPHUS TOWNS, New York
JOHN M. McHUGH, New York PAUL E. KANJORSKI, Pennsylvania
STEPHEN HORN, California PATSY T. MINK, Hawaii
JOHN L. MICA, Florida CAROLYN B. MALONEY, New York
THOMAS M. DAVIS, Virginia ELEANOR HOLMES NORTON, Washington,
MARK E. SOUDER, Indiana DC
JOE SCARBOROUGH, Florida ELIJAH E. CUMMINGS, Maryland
STEVEN C. LaTOURETTE, Ohio DENNIS J. KUCINICH, Ohio
BOB BARR, Georgia ROD R. BLAGOJEVICH, Illinois
DAN MILLER, Florida DANNY K. DAVIS, Illinois
DOUG OSE, California JOHN F. TIERNEY, Massachusetts
RON LEWIS, Kentucky JIM TURNER, Texas
JO ANN DAVIS, Virginia THOMAS H. ALLEN, Maine
TODD RUSSELL PLATTS, Pennsylvania JANICE D. SCHAKOWSKY, Illinois
DAVE WELDON, Florida WM. LACY CLAY, Missouri
CHRIS CANNON, Utah DIANE E. WATSON, California
ADAM H. PUTNAM, Florida ------ ------
C.L. ``BUTCH'' OTTER, Idaho ------
EDWARD L. SCHROCK, Virginia BERNARD SANDERS, Vermont
JOHN J. DUNCAN, Tennessee (Independent)
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
James C. Wilson, Chief Counsel
Robert A. Briggs, Chief Clerk
Phil Schiliro, Minority Staff Director
C O N T E N T S
----------
Page
Hearing held on June 21, 2001.................................... 1
Statement of:
Bostrom, Sue, senior vice president of the Internet Business
Solutions Group [IBSG], Cisco Systems; and Curt Kolcun, e-
government director, Microsoft Corp........................ 32
Daniels, Mitchell E., Jr., Director, Office of Management and
Budget..................................................... 10
Willemssen, Joel, Managing Director, Information Technology
Issues, General Accounting Office; Jim Flyzik, Acting
Assistant Secretary for Management and Chief Information
Officer, U.S. Department of the Treasury; John Mitchell,
Deputy Director, U.S. Mint; John L. Osterholz, Principal
Deputy Chief Information Officer, U.S. Department of
Defense; and Norma J. St. Claire, Director, Information
Management for Personnel and Readiness, Office of the
Secretary of Defense....................................... 61
Letters, statements, etc., submitted for the record by:
Bostrom, Sue, senior vice president of the Internet Business
Solutions Group [IBSG], Cisco Systems, prepared statement
of......................................................... 35
Burton, Hon. Dan, a Representative in Congress from the State
of Indiana, prepared statement of.......................... 5
Daniels, Mitchell E., Jr., Director, Office of Management and
Budget, prepared statement of.............................. 13
Flyzik, Jim, Acting Assistant Secretary for Management and
Chief Information Officer, U.S. Department of the Treasury,
prepared statement of...................................... 80
Kolcun, Curt, e-government director, Microsoft Corp.,
prepared statement of...................................... 43
Mitchell, John, Deputy Director, U.S. Mint, prepared
statement of............................................... 89
Osterholz, John L., Principal Deputy Chief Information
Officer, U.S. Department of Defense, prepared statement of. 140
Towns, Hon. Edolphus, a Representative in Congress from the
State of New York, prepared statement of................... 156
Willemssen, Joel, Managing Director, Information Technology
Issues, General Accounting Office, prepared statement of... 64
FEDERAL INFORMATION TECHNOLOGY MODERNIZATION: ASSESSING COMPLIANCE WITH
THE GOVERNMENT PAPERWORK ELIMINATION ACT
----------
THURSDAY, JUNE 21, 2001
House of Representatives,
Committee on Government Reform,
Washington, DC.
The committee met, pursuant to notice, at 10:05 a.m., in
room 2154, Rayburn House Office Building, Hon. Dan Burton
(chairman of the committee) presiding.
Present: Representatives Burton, Gilman, Morella, Mr. Tom
Davis of Virginia, LaTourette, Ose, Lewis, Platts, Otter,
Schrock, Duncan, Waxman, Kanjorski, Norton, Cummings, Kucinich,
and Watson.
Staff present: Kevin Binger, staff director; David A. Kass,
deputy chief counsel; Mark Corallo, director of communications;
Nat Wienecke and Michael Canty, professional staff members;
Robert A. Briggs, chief clerk; Robin Butler, office manager,
Leneal Scott, computer systems manager; John Sare, deputy chief
clerk; Corinne Zaccagnini, systems administrator; Phil Barnett,
minority chief counsel; Michelle Ash, minority counsel; David
McMillen, minority professional staff member; Ellen Rayner,
minority chief clerk; and Earley Green, minority assistant
clerk.
Mr. Burton. Good morning. We want to try to get started as
quickly as possible. We were informed that there is going to be
a vote on the floor at 10:30, so we will have to break at 10:30
when we have that vote for probably 15 minutes. So I would like
to get started if we can.
Good morning, Mitch. How are you?
A quorum being present, the committee will come to order. I
ask unanimous consent that all Members' and witnesses' written
opening statements be included in the record. Without
objection, so ordered.
I ask unanimous consent that all articles, exhibits and
extraneous or tabular material referred to be included in the
record. Without objection, so ordered.
I have always said that government needs to act more like
the private sector, private business; and that has never been
more true than today. U.S. businesses are more efficient and
productive than ever before. They are cutting costs. They are
providing better service. They are responding to changes in the
marketplace faster.
They are doing all this with information technology. They
aren't just treating computer systems like a cost of doing
business; they are using them to achieve competitive advantage.
And that is exactly what we should see and want to see in the
Federal Government. We want to see the Federal agencies provide
better service. We want them to be more responsive to our
constituents. We want to see them become more efficient.
If they are going to do all these things, they have to take
advantage of new developments in information technology. The
problem is, too many agencies are spending hundreds of millions
of dollars maintaining outdated computer systems. Too many
agencies are saddled with computer systems that can't talk to
one another. Too many agencies haven't had the vision to break
out of the old way of doing things.
In our congressional offices, we have people come to us for
help all the time. People have problems with the Social
Security Administration. They have problems with the Veterans
Administration. They have problems with a lot of different
agencies. These agencies are bogged down with outdated
information systems and paper files.
Sometimes people have cases that get bogged down for months
or years when it should only take days or weeks. We have got to
do better than that.
I know that there is a serious problem between the
Department of Defense and the Department of Veterans Affairs.
When a veteran goes to the VA to apply for benefits, the VA has
to request his personal records from the Defense Department.
But their computers can't talk to each other; it has to be done
on paper. There is such a huge filing backlog at the Defense
Department that these cases sometimes get hung up for years,
and that is just not acceptable.
As I understand it, there is an ongoing project at the
Defense Department to try to fix that problem. It is going to
take years, because there is a huge volume of information they
are dealing with. I am going to ask the Defense Department some
questions about that today.
If the government is going to radically improve the way we
do business, it is going to take leadership from the top. That
is why I am glad we have the Director of OMB, Mitch Daniels,
here to testify today. He has made it very clear that
management reform is at the top of his agenda. I think he is
sending a very positive signal by being here to talk in person
today about this.
Mitch, thanks for being here. It is nice to see a fellow
Hoosier.
I think Congress has tried to do its part to give agencies
the tools they need. In 1996, we passed the Clinger-Cohen Act.
It required all of the major Federal agencies to have chief
information officers to coordinate their information resources.
In 1998, we passed the Government Paperwork Elimination
Act. The idea was to get agencies to let people file government
forms electronically. We gave them a deadline. We asked them to
have electronic filing for their most important and most widely
used forms by October 2003.
What we need to do now is to conduct oversight to make sure
that agencies are putting these tools to work. That is why we
are holding this hearing today.
We want to accomplish two things. First, we want to see if
agencies are complying with the GPEA, and we want to see if
they are taking this mandate seriously and doing what is
necessary to make electronic filing happen.
Second, we want to go beyond GPEA. We want to see if
agencies are thinking strategically and making wise information
technology investments. We want to know if they are really
taking a hard look at the way they do business to see if there
is a way to do it more efficiently.
We have some good success stories out there. The U.S. Mint
is one of them. We have asked them to come and testify today.
They used to have a lot of individual computer systems that
couldn't communicate with each other. If they needed to get
information from one system to another, they had to print it
out on paper from one and type it into another. Coin collectors
had to order Mint sets through the mail. It took them 2 or 3
months to get their orders.
Over a 12-month period, the Mint changed their entire
computer system--in 12 months. Now everything is compatible.
Today, coin collectors can order Mint products on-line, and
they get them in 2 or 3 weeks.
I think that the Mint has been a success story because they
had leadership that was committed at the top. One of the
questions I have is, how can we take the lessons learned at the
Mint and translate them to other agencies?
These are complicated issues. We could all spend days
talking about all the issues at all of the different agencies.
What I thought we would do today is narrow our focus.
We are going to look at two agencies, the Department of
Treasury and the Department of Defense. Our starting point is,
are they complying with GPEA? Are they moving forward with
electronic filing? If they are doing that, well, then hopefully
that is an indicator that they are doing other things as well,
too.
Last October, they were required to file plans with OMB.
They were supposed to lay out a timetable showing when
different forms would be automated. We looked at the Treasury
Department's filing. It was pretty impressive. It laid out a
strategic plan. It laid out a number of initiatives. It said
that 55 percent of their forms will be available for electronic
filing by 2003. It was fairly apparent that there is a high
level of support at Treasury for getting this job done.
We then looked at the Defense Department's filing. It left
us with a very different impression. It wasn't very complete.
Out of 182 different forms that the public has to fill out,
they couldn't give us an estimated completion date for over 100
of them. According to the plan we reviewed, fewer than 25
percent of their forms will be available for electronic filing
by 2003. There wasn't any evidence of any strategic planning
whatsoever.
We sat down with the people from the CIO's office. What
they told us is that they just collected the information OMB
wanted from the different services and passed it on. It became
fairly clear that nobody at a senior level was taking
responsibility for making sure the job was getting done. They
were just collecting information and passing it on; and that is
not acceptable.
It seems to me that when Congress passes a law that says
you have to do something, and when OMB sends you instructions
on how to implement the law, it ought to get a little more
serious attention than it has been getting at the Defense
Department.
Since then, we have learned that there are a lot of
different modernization programs going on in the Army and the
Navy and Air Force and other parts of the Defense Department.
We are going to hear about some of them from our Defense
Department witnesses today.
But I am now very concerned about how much leadership there
is at the top for these initiatives. The Defense Department is
a big place with lots of different branches and services. If we
don't have somebody very senior taking charge, I am afraid they
are going to wind up with lots of new systems that can't talk
to each other, replacing all of the old systems that couldn't
talk to each other.
With the volume of business that the Defense Department
does and the millions of paper forms that get filled out every
year, hundreds of millions of dollars could be saved if we
could automate these processes.
We have two witnesses from the Defense Department today,
and I hope they will be able to give us a better comfort level
with what is going on over there.
Let me finish up by going back to what I started with. The
government ought to act more like a private business. In the
private sector, billions of dollars have been saved by using
information technology.
We have two witnesses from two of the leading high-tech
companies in America here today. They are going to tell us how
they did it. Hopefully, they are going to tell us how the
Federal Government and the State governments can learn from the
private sector and how they ought to do it.
We have Sue Bostrom from Cisco Systems and Curt Kolcun from
Microsoft here today. I want to thank both of you and your
associates for being here.
I want to thank Kevin Binger, who has worked very hard on
this. Kevin is very interested in the new technologies, and
Kevin is our chief of staff. I really appreciate all you have
done.
With that, I yield to Mr. Waxman.
[The prepared statement of Hon. Dan Burton follows:]
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Mr. Waxman. Thank you very much, Mr. Chairman. Thank you
for holding this hearing on the Government Paperwork
Elimination Act [GPEA].
This legislation was passed as an attachment to a
supplemental appropriations bill at the end of the 105th
Congress. GPEA requires agencies to give individuals the
opportunity to submit information electronically when
practicable. In addition, it allows a person to use his or her
electronic signature to file the submission.
GPEA, just like the Paperwork Reduction Act, which it
amends, attempts to reduce the paperwork burden placed on the
public by the Federal Government. It has yet to be demonstrated
whether electronically submitting information reduces the
number of burden hours it takes people to complete the required
submissions. However, it may have other benefits, such as easy
access to forms or relief from the cost of postage.
I have supported e-government initiatives and believe they
can benefit the public. By using technology to collect and
disseminate information, agencies can help government be more
efficient and more responsive to the taxpayers. E-government
should include encouraging agencies to allow people to comment
on regulations electronically as well as allowing them to read
the comments from others electronically. This saves time, money
and effort.
For some agencies, individuals still have to go to
Washington, DC, and review the handwritten docket in order to
intelligently comment on a proposed regulation. Although modest
steps have been taken to address this issue, much work is left
to be done.
Care must be taken in developing electronic information
collection systems to assure that we protect individually
identifiable information, business proprietary information, and
truly reduce the burden placed on those submitting information
to the government. Privacy protections must be paramount.
Over the last decade, we have seen an increase in identity
theft; an individual's credit cards, Social Security numbers or
driver's license can be stolen or copied with relative ease. As
more and more people electronically submit information with
electronic signatures, we must work to prevent them from
becoming victims of identity theft.
Mr. Chairman, GPEA has the potential to help the Federal
Government better manage its information collections. As
technology advances, I am hopeful that agencies with the proper
protections in place will be able to adapt and respond quickly
to the needs of the people.
I look forward to the insight from our witnesses. Thank you
very much.
Mr. Burton. Thank you, Mr. Waxman.
Do other Members have opening statements?
If not, I want to start off by welcoming the great
Congressman from Tennessee, John Duncan, my very good friend,
to the committee. I know he will be a great asset to us.
I ask unanimous consent that he be appointed to the
Subcommittee on Energy Policy, Natural Resources and Regulatory
Affairs. Without objection, so ordered.
Well, we want to welcome Mitch Daniels. He has been a
leader in Indianapolis, IN, for a long, long time. He was an
executive for the Lilly Co. In fact, I think you were president
of International Trade at one time.
Mr. Daniels. North America.
Mr. Burton. North America. Well, that is close. In any
event, he is head of OMB. I think he is a great appointment. I
really appreciate you being here. You are recognized for an
opening statement.
STATEMENT OF MITCHELL E. DANIELS, JR., DIRECTOR, OFFICE OF
MANAGEMENT AND BUDGET
Mr. Daniels. Thank you, Mr. Chairman and Congressman
Waxman. I appreciate the committee's hospitality. And let me
reciprocate by being very brief in my opening statement. I will
submit a statement for the record, of course.
Let me just say two or three things about this very
important subject on which you gather us today. The
administration has announced and will follow through on a major
commitment to use the tools of the Silicon Age to improve the
performance of government and also its effectiveness on
behalf--or its interaction with individual systems.
From a very, very lengthy list, the President has selected
five topics as his primary management objectives for this year,
and e-government is among those five.
Last week, we appointed a seasoned professional with
experience both in government and in the private sector, who
will work all day every day on this and this alone. In addition
to that, we will, of course, support his work with all the
resources necessary to make sure OMB upholds its
responsibilities here. The Deputy Director for Management, who
is yet to be appointed, will carry as a primary responsibility
the job of the President--or of the Federal Government's CIO
and will chair the CIO Council of his counterparts or her
counterparts in each of the agencies.
Let me just summarize the problem areas.
Success stories are abundant, as you have indicated, but I
think the committee and certainly we at OMB want to focus on
the areas where improvement is most urgently needed. By our
tabulation, there are at least 6,000 eligible transactions,
citizen transactions, not yet Web-enabled or with an electronic
option. At this point, agencies can only certify to us that
something less than half of those will meet the 2003 deadline.
We don't consider that acceptable, and we will work to
improve--I hope to be able to report to this committee at a
later date that that number is headed northward.
Our scan of the capital planning process at the agencies
and their preparedness to meet the objectives of their
assignments here finds good performers and not-so-good
performers. It probably bears mentioning that the EPA,
Treasury, and HUD, as far as we are concerned, are among the
leaders. On the other hand, HHS, Defense and Justice we think
have the furthest to go.
I would also observe that many agencies, I think, will be
hamstrung by their own organizational structures. I will say a
word about this as I conclude, but far too many agencies have
not one, but multiple IT problems because they have multiple
organizations all pursuing different and often incompatible
agendas and architectures. HHS might be the most extreme
example with its 13 sometimes competing empires.
We will try to focus our attention primarily on sort of the
high-yield opportunities, those where we think we can make the
most improvements the most quickly, those with the most citizen
encounters.
I will cite tax filings. Although the Treasury has done
some excellent work, they have perhaps the largest single job
to do, and there are something like 200 applications, I am
advised, that could make more simple and straightforward the
taxpayers' relationship with the IRS, that have yet to be
rendered electronic.
One other general point: I think that the Congress and the
committee in its oversight of this law has given the Federal
Government yet another opportunity, which I hope we will seize,
to clean house in terms of activities that may not be necessary
at all. We used to say in business there is nothing more tragic
than to do very, very well something which is totally
unnecessary.
As I look at some of the applications or some of the
eligible activities of government that could be transformed in
an electronic fashion, I think the threshold question is, is
this still necessary in the first place?
At Agriculture, for example, there are millions of hours of
reporting imposed upon farmers and producers, collecting
information that may or may not be necessary. Before we invest
the taxpayer dollars to make collection of that information
electronic, we ought to take the opportunity to check and see
if, maybe, this is a once-good idea that is now obsolete.
I think Congressman Waxman had an excellent question when
he reminded us that we can't automatically assume that simply
by switching from paper to a terminal, the burden on anyone has
been reduced in the way we hope it will be. I think that
question has to be asked each and every time.
Last, let me just say that I think one of the largest
problems and one we are going to try to work very hard on that
encompasses this subject and, frankly, many more, has to do
with the efficiency or lack of it with which the Federal
Government now spends upwards of $45 billion on IT.
In a $2 trillion budget, you know, a 2.5 percent--something
like that--investment in information technology is low by
private sector standards, but not dramatically below that of
many businesses. Yet, I cannot testify today that that money is
being well spent or spent in an integrated fashion.
In fact, it is my apprehension that much of that money,
even as we sit here this morning, is being spent to make a bad
situation worse; that as we convene here, people with the best
of intentions are assiduously designing and contracting for
systems which are tailored, which are customized, which are not
compatible with the systems with which they need to interact,
and that people are working very hard in a way that is at
cross-purposes with this committee's goals and those of GPEA.
So we are going to try to identify that, and we are going
to try to root it out, try to bring greater cooperation,
integration and, frankly, in many cases, dictation of systems
decisionmaking in hopes that we can begin to turn this tanker
in the way that the committee has and the authors of this bill
have wisely directed.
Thank you for this opportunity.
[The prepared statement of Mr. Daniels follows:]
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Mr. Burton. Let me start the questioning by just asking a
couple of, I guess, generic questions or general questions.
First of all, I want to get every agency to review whether
or not information that they are requiring from different
segments of our society are necessary.
Then, second, you indicated that--and I read your
testimony--that you indicated that there was going to be an
effort to have them coordinate their efforts so that there is
not one agency going in one direction with technology and
another going in another direction.
Who is going to be--and you touched on this, but who is
going to be--I mean, this is a huge government. And to go
through every agency to find out whether or not there ought to
be an elimination of some of the information that is coming in
and whether or not they ought to adopt a certain type of
computer technology, who is going to be put in charge of that?
Mr. Daniels. The Deputy Director for Management will have
this as a principal responsibility. I regret that, yet again, I
have to testify that we don't have that person in place. We
have set the specifications for that job very high for this
very reason and for several others like it. We have filled
every job but this one at OMB, I am happy to say. But this will
be a primary responsibility of my primary associate.
In the meantime, the other deputy, the general deputy, is
acting in this area. We also were fortunate to recruit on a pro
bono basis the president of the National Academy of Public
Administration, a very seasoned, nonpartisan government
administrator, who is filling in and working on these issues
now.
As I say, next week, a full-time information associate,
Mark Forman, will be joining us.
Mr. Burton. Well, I----
Mr. Daniels. Let me add just one other thing, Mr. Chairman:
It is not simply a matter of interagency, but also intra-agency
incapability. Some of the worst problems I have seen in the
superficial look I have had a chance to give so far really
exists within departments, as opposed to--in their need to
connect or interact with other departments.
Mr. Burton. We had a press conference yesterday, and the
Majority Leader, as well as others--committee chairmen--were
talking about this.
It seems like--and I think you touched on it in your
opening statement--that a lot of the agencies are taking
archaic systems and trying to improve the current system, when
they probably would be better served to junk them and start
with the newest technology instead of trying to bring old
technology up to current standards.
We are going to have Cisco and Microsoft testify in a
little bit. Is anybody working with these various computer
companies to find out what the latest technology is going to be
that should be used for the entire government, so that--like we
were talking about--they can all talk to one another within a
given agency, and then intra-agency-wise as well, and to make
sure that they are not in the process wasting money on old
technology they are trying to bring up to current standards?
Mr. Daniels. I think the CIO Council is the appropriate
vehicle, or certainly one, for addressing these sorts of
problems. We will just try to use it as effectively as we can.
Now, I pretend to have no great expertise in this area
myself, but I have, through past vocational experiences, come
to some general conclusions. Along the lines of your question,
standardization and simplification, I learned the hard way, are
pretty good objectives. And I think that in many cases it will
be important to ask agencies hard questions before they pursue
the perfect solution for themselves, which may aggravate the
general problem the government has by virtue of its very
customized or, you know, mission-specific character.
Mr. Burton. Well, I realize that we are asking you
questions that you probably aren't prepared to answer yet
because, you know, this is a new administration.
Mr. Daniels. That won't stop me. I answer questions on
unfamiliar subjects all the time.
Mr. Burton. When I first got elected to the Congress, 1 day
I was a candidate and nobody expected me to know anything. The
next day, I was elected, and everybody was asking me questions
about international policy that I had nothing to do with. So I
am sympathetic with the problem.
Mr. Daniels. You get away with it pretty well. I will try
to do the same.
Mr. Burton. OK. Let me end up by saying, before I yield to
my colleagues--and we will have the experts testify in a little
bit--it seems to me and maybe my colleagues that it would be
advisable--and you may be way ahead of us on this--to bring in
some experts from the various high-tech areas and have them do
a cursory look at all the agencies to make some recommendations
on the front end to whomever you are going to choose to head
this up, so that they can have at least a basic idea of where
they think the high-tech people think we ought to go. Because
technology is moving so fast that I think that to not include
them in the loop--and I am sure you will, but to not include
them in the loop will be a serious problem.
Mr. Daniels. Let me say that is a great suggestion. One way
we are active on this sort of front, Bob O'Neill, the gentleman
I referred to from the National Academy, has already met for
the first time with leadership of some of the Nation's major
consulting firms about the management agenda, not limited to
the IT challenge, but including it. We expect to call on their
patriotism to see if they cannot see their way clear to donate
some advisory services that the government would benefit from.
Mr. Burton. Very good.
Mr. Waxman. Thank you, Mr. Chairman.
Mr. Daniels, thank you very much for being here. I realize
it is early on some of these issues that we are looking at for
you to have definitive positions. You don't have the Deputy
Director in place. Maybe this hearing today will also be
helpful to the administration in having that Deputy Director be
able to review the record of information that comes out of our
oversight activities.
The Justice Department seems to have serious concerns about
the use of digital signatures. How will your administration
weigh those concerns against the call from GPEA for a serious
effort to increase the role of electronic reporting in Federal
information collections. Do you have any view on that at this
point?
Mr. Daniels. Well, this is one of a number of obvious
tensions that we will all have to work together in reconciling.
Concerns of privacy, concerns of security are very, very real.
I will just say that the President, in particular, has
placed a lot of emphasis on the preservation of privacy even as
we try to make progress in this and related areas. I will have
to take up Justice's specific concerns outside this hearing. In
all honesty, I am not sure how to react to their particular
worries in this area; but I don't doubt, when I do, I will find
that there is some legitimacy to their hesitation.
Mr. Waxman. The Paperwork Reduction Act lays the groundwork
for information management in the Federal Government. That act
has been amended a number of times since being reauthorized in
1995. Some have suggested that the Paperwork Reduction Act
needs to be reworked to address the issues of electronic
government in the 21st century.
The Paperwork Reduction Act authorization expires this
year. Will the administration be sending to Congress
recommendations for changes to be included in the
reauthorization? And when do you think those will be available?
Mr. Daniels. I don't know the answer to the when, but I do
believe that we will have at least some report to Congress, and
possibly some recommendations to accompany it, about the act,
the way it is working and how it might work better. I have
become aware already of at least a couple of instances--they
may be aberrational--in which ironically the act may lead to
more, not less, burden in terms of paper and information
requests.
I think it is our duty to report that there are
experiences, good and bad, with the act, and the
reauthorization would be the right time.
Mr. Waxman. Good.
The GPEA report for the Department of Defense shows that it
is not moving quickly to implement the requirements of this
act. Earlier this week, one of the subcommittees of this
committee held a hearing on the Government Performance and
Result Act [GPRA]. In that hearing, it was also pointed out
that the Department of Defense was not moving quickly to
implement the requirements of that act.
What will your administration do to persuade DOD that it
needs to get on board with these efforts to make government
more accountable and user friendly?
Mr. Daniels. Well, we are placing a number of demands on
the Department of Defense and this administration. This will
have to be high on the list.
I think we should all recognize the immensity of the
management challenges that Secretary Rumsfeld and his
colleagues face, and all their predecessors and successors, for
that matter, in an enterprise that big. But we will certainly
ask them to elevate substantially their attention to this one.
Once again, from a list that, as I recall, was originally
about 61 items, we distilled to 5 those that the President has
designated as governmentwide, mandatory, top-management
priorities; and this is one. So we will take his direction and
stay on top of them.
Mr. Waxman. It occurred to me, as I was reading these
questions to you about GPRA and GPEA and PRA, that these are
just a few of the laws that we have to deal with; and you have
to deal with all of them, all of them within the government.
And when people come to you, they must refer to each of these
pieces of legislation as if it were the most important thing on
your mind at that moment.
Mr. Daniels. Well, at that moment, it is. Or at least if it
is you asking, it is.
Mr. Waxman. I guess the first thing you have to do is to
find out what the letters stand for. Well, I want to wish you
well in your position.
Mr. Daniels. Thank you.
Mr. Waxman. And I hope that, as this committee looks at
these issues, we can develop a collegial working relationship.
We want the same goals.
Mr. Daniels. Yes, sir. Well, I trust we will. And I will
say very sincerely that hearings like this and questions from
the committee are very, very useful, both in forcing us to
become better educated about subjects we need to learn more
about and keeping our attention from wandering away from
important assignments. So we thank you for this invitation.
Mr. Burton. Thank you, Mr. Waxman.
And I and others who are here today are very interested in
working with you. And if you have legislative requests that
will streamline government, make it more efficient, especially
from an electronic standpoint, we will be very happy to work
with you.
Mr. Schrock.
Mr. Schrock. Thank you, Mr. Chairman.
Good morning, Mr. Daniels. You mentioned that agencies like
the Mint are doing a good job and that one agency that is dear
to my heart, the Defense Department, along with HHS and
Justice, are not. Did the Mint create their own program
internally or did they contract out? No matter who created it,
if it is successful, why can't other agencies use it as a
template for their own agencies?
Mr. Daniels. It is an excellent question. I honestly don't
know. But fortunately you have the people from the Mint here to
tell you the origins of the program. I only know that it does
rise near the top in the estimation of our people in terms of
applications so far.
That is a very important point you make--and this we have
stressed; we are going to try to stress across the entire
management front--this government doesn't transfer learning
very well. There are, on any subject I have looked at so far,
always pockets of excellence. But very, very rarely has that
excellence migrated in the way that a high-performing
organization will insist that it do.
You have some people here from some high-performing
businesses. I know they will tell you, as was our experience,
that in a good business today, it is considered a grievous
malfeasance for a manager who has done something, or whose unit
has done something, innovative to fail to share that
information across the organization. It is seen as an
affirmative duty.
That isn't happening nearly to the extent it should. I do
feel it is a heavy responsibility because OMB is a hub in a way
and does operate the various councils and so forth, and this
should not be hard to do. We should be able to take whatever
the Mint has learned and spread it far and wide, wherever it
might apply.
Mr. Schrock. I agree. Thank you, Mr. Chairman.
Mr. Burton. Mr. Duncan.
Mr. Duncan. Thank you, Mr. Chairman.
Mr. Daniels, I heard a report on CBS national news a few
months ago that said 37 percent of the time that people are
spending on their computers is spent sending jokes or checking
their stocks or on personal matters. Then, week before last,
the Inspector General of the Internal Revenue Service came out
with a report saying 51 percent of the time IRS employees are
spending on their computers is spent visiting porn sites and
sending jokes and checking their stocks and all of these types
of things.
The goal of the Paperwork Elimination Act is to make the
government more efficient. Is there anything that you know of
that we can do or that can be done to see that less time is
spent using these computers, these government computers for--I
noticed in your testimony a moment ago you said we shouldn't
automatically assume that paper is always less efficient than
the computers.
I just wonder about that. Is anything being done about that
or can anything be done about that?
I have to tell you, I did have a couple of friends, though,
who said they would be upset if it was another government
agency, but with IRS, they would just as soon 51 percent of the
time be spent on personal----
Mr. Daniels. They might prefer it was higher.
Mr. Duncan. Right.
Mr. Daniels. It strikes me as equally important, but a
somewhat different question than we are talking about with
GPEA, where I think the primary emphasis is on opening up to
the external--to the public the external world the better
channels of communicating and dealing with its government.
The problem you are talking about, I know it is very real.
It is not confined to government. Good managers detect the
problem when it is out of hand and act against it. You know,
here too there has to be some--I think there has to be due
sensitivity to employee privacy. But there are pretty well-
established rules, as I understand it, for surveillance or
back-checking where there is some clear evidence of abuse or
misuse.
Mr. Duncan. The second thing I wonder about, and it is a
little different direction from most people, because it is sort
of politically incorrect today not to worship the computers.
And everybody always, I guess, is trying to outdo themselves to
say that we should always go to the next level and the most
advanced technology. But what I think sometimes the computer
companies sell us a bill of goods, because they always want us
to buy new equipment all the time.
Mr. Daniels. Yes.
Mr. Duncan. Obviously they make more money if we do that.
But sometimes I think it is sort of like buying a car.
Sometimes it is more cost-effective and just as efficient if we
stick with a car that is a year or two old than if we always
try to buy the newest car with the newest bells and whistles.
What I am wondering about, since your primary
responsibility is the money involved, or that the government is
spending, should we be attempting to make sure that our
technology purchases are cost-effective and that they will
work? I think the chairman or somebody mentioned--or maybe you
did in your testimony just now, about not always having to go
to systems that are incompatible and so forth.
Mr. Daniels. Yes, sir. I think it is very, very important.
A good capital planning process--I make reference to that
throughout the testimony--will identify the likely rate of
return or the benefits to be derived from an investment. Done
properly, that will very, very often, I think, steer a buyer, a
user, away from the bells-and-whistles applications, the latest
and greatest. There is a romance about that. People who are,
you know, knowledgeable about technology I think sometimes get
captivated by that and go beyond the point of diminishing
returns.
This is exactly what we are trying to get at in critiquing
the capital planning processes within agencies. It is exactly
what we will try to get at if we win--I give the direction to
the DDM and the intelligence--I mean, the information officer
to press always for the simple, the standard, the common, the
more easily compatible.
Mr. Duncan. All right. Thank you very much.
Thank you, Mr. Chairman.
Mr. Burton. Mr. Kanjorski, do you have any questions?
Mr. Kanjorski. Yes.
Mr. Daniels, I don't know that we have won any awards in
the Federal Government in utilizing new technologies to provide
better service or more efficient service. So I am not certain
that I am satisfied that we can accomplish a lot of the things
we do in the Federal Government to do that.
But what I am most worried about is areas like
Pennsylvania. Unfortunately, we have, I think, the second
largest number of municipal governments in Pennsylvania of any
State in the Union--2,500 municipal governments, 90 percent of
which are under 3,500 in population.
So it is interesting to analyze what will happen if the
Federal Government does go to sophisticated computer systems
when more than 45 percent of the governments in my
congressional district don't have computers. I am just
wondering what portion of the population of the United States
has the capacity either of having computers or fitting into a
network.
What I am most worried about is, we are going to move ahead
very quickly on some of these things, not realizing that we are
leaving behind a very large portion of our population.
We had some testimony on that the other day in the
Committee on Banking in terms of analysts and what they do in
stocks and bonds. I try to draw the analogy, there is a
question there, whether or not the information coming out is
objective and responsible. But one of the bigger problems that
I saw in the analysts' problem that I see now in the technology
problem of the government is, you know, I think we are missing
the point.
The last time I looked at a study, 20 percent of the
American people were functionally illiterate. So, at best,
right now, we can be talking to only 77 percent of the American
people. It seems to me that before we move hell-bent forward on
doing a lot of things, we have to make sure that we are giving
access to the American people, to the government, and to the
municipalities.
I have noted recently that--we haven't done a study on it,
to confirm it, but I am sure if you do a study, you are going
to find that there is a decided difference between how
communities interact with the government on some programs to
get benefit directly relates to their level of sophistication
and technology.
I am just noticing in a lot of these rural districts
through the country, and in particular Pennsylvania because of
our archaic structure, they are just not capable, the local
leadership and the citizenry, of really accessing some of these
sophisticated systems.
Then, the only thing I would add to that is, I wish you
would look at the House of Representatives as you go through
this system, because I don't think we are famous for having the
best system in the world.
Mr. Burton. Careful.
Mr. Kanjorski. And I don't want to--it is national, not a
political criticism, because quite frankly, I would have to
give a lot of credit to the revolutionary forces of 1994. They
tried very hard. But sometimes philosophically they got bent
into accomplishing something with technology, and I could call
your attention to one thing. All of us have become purchasing
agents now, in the individual Member's offices, of equipment.
We are ill prepared to do that.
I can tell you that it has been a catastrophe trying to
find out the best system, what systems work. Then when you
order a system that is misrepresented and it doesn't function,
what do you do with it? And negotiating each individual office
with a huge or large contractor who, quite frankly, is probably
one of two or three providers and really doesn't give a damn if
you say, I am going to take out my system. He says, tough luck;
go back to typewriters, Congressman, if you are unhappy.
So we have a lot of management problems. In a way, I have
been trying to convince people in the 17 years that I have been
in Congress that your office has an interesting title. The
management factor inside of your title has really not been well
utilized. I think one of the prior Members mentioned you have
great budgets down there. You have good numbers. I respect both
administrations', how they happen. They usually come out better
than we do up here on the Hill in number crunching.
But in management direction and skills, I think there has
been a decided failure in the Federal Government in all
branches, all three branches of the Federal Government, to
really put their management techniques into place. I don't know
what can be done about it. Probably government can't accomplish
the standard that the private sector has to accomplish if it is
going to be competitive.
But if in some way you would think about the management
aspect of taking this new technology across government, and
then, if we get so sophisticated that we can communicate with
Mars, but we can't communicate with 23 percent of the American
people and we can't communicate with 40 percent of the
municipalities, I don't know whether we are going to get value
out of the thing. We may just exclude people from the system.
Right now, I mean, I hate to tell you, but some of the
municipalities in my district don't have typewriters. They
actually keep notes by hand. If that applies in my district, I
think if we look across the country, we are going to find a lot
of communities that are totally devoid of equipment,
efficiency, and even if you gave them that--of expertise.
I have been particularly involved in GIS for planning
purposes. We have been doing fairly sophisticated work in
Pennsylvania and across the country with a lot of the GIS
movement in how to use this as a tool for government planning.
It is a phenomenal tool, a tremendous potential cost-saver.
We are working on a program now of land and water
reclamation that we estimate we can save anywhere from 30 to 40
percent of the costs that normally are spent by the Federal,
State and local governments to do this work, because we can
remove the field engineering into the computer operation
through use of GIS.
But all that being said, if we don't have the operators out
there, if we don't find a way to put in kiosks for access for
people who don't have computers; and then if we don't have
operators who are skilled enough to access the Federal
Government, the State government, the local government and all
this information that is available, I am not sure we are going
to be very successful.
So I guess what I would say is, I hope you come forth with
a very comprehensive plan, breaking all these areas down and
just seeing what types of platforms we have to put in place,
both in person skills and various technologies, to get there;
or else we are going to spend--I mean, we don't want to make--
is it the FAA that put that very sophisticated system together
that didn't work? You know, that is really unforgivable. Those
are people that are in an area of expertise that should be able
to handle it.
I think we are going down the road right now, we may do a
lot of hardware and software and not have the programmers or
the users that are capable of accessing it. And we may just end
up alienating a third to a half of the American population from
government, from the Federal Government. Thank you.
Mr. Burton. If I might just add to that, you hit on the
House of Representatives and how we are all buying our own
individual systems, and there is not a lot of coordination
there.
I know that OMB is not going to be dictating to the House
or the Senate on what we do; but what might be advisable is,
when you come up with a strategic plan for computerization and
consistency throughout the Federal Government, you could make a
recommendation. Obviously, we wouldn't always follow it, but
you can make a recommendation to the House and the Senate that
it would be advisable for us to have a plan consistent with the
rest of the agencies so we can all talk to one another
electronically.
So that would be one thing from Mr. Kanjorski that I might
add to the mix.
Mr. Kanjorski. I want to add to that. We could maybe model
after some of the States.
I used to represent municipal governments as an attorney
before I succeeded to this great, high office; and the
experience in Pennsylvania was that the GAS in Pennsylvania
allowed municipalities to dovetail on their contracts, both for
prices and service.
And just within the government, if all three branches could
dovetail on what you are doing, you are going to be buying a
much larger area. We don't necessarily have, one, that
expertise or that buying capacity to think about dovetailing us
in.
I am not sure about even dovetailing in the States and the
municipalities, so that anything that you come up with has to
be compatible among the three branches of the Federal
Government and all the lower governments in the country to come
in and use the Federal purchasing capacity and expertise of
some of this.
Mr. Burton. Thank you, Mr. Kanjorski.
Mr. Otter.
Mr. Otter. Thank you, Mr. Chairman.
Welcome back, Mr. Daniels. It is good to see you again. I
remember when you appeared before our subcommittee on this very
issue. We had some good exchanges.
You know, it is interesting to hear some of the
conversation in front of the full committee here about how
unable we are to respond to this sort of thing. I am reminded,
2 years or 3 years before I got here, I am sure it didn't come
out of this committee, but I am sure members of this same
committee voted for a law which told all small business that
you have to electronically file your tax returns whether they
had computers or not. But you have got to do it. You have got
to comply. You have got to make it happen.
I know that the Paperwork Reduction Act has been in force
for a long time.
Let me reflect back to our subcommittee. As you will
recall, we had 487 violations last year. We had 710 in 1999
that your department reported on, and 872 in 1998, if my memory
serves me correctly or my information. And I think I asked you
at the time, and I just want to ask you again for the benefit
of the full committee: How many people lost their jobs because
all those laws were violated, or how many people went to jail?
How many people were fined, as we would the private sector?
Mr. Daniels. Well, I am unable to report that anyone went
to jail----
Mr. Otter. Was anybody fined?
Mr. Daniels [continuing]. Or that there were other
meaningful penalties. I understand the thrust of your question.
Mr. Otter. So that leads next to my real question to you.
Wouldn't it be helpful to your organization to enforce this law
if we gave you--as the Congress is always fond of calling it--
some ``teeth,'' like we give teeth to OSHA, we give teeth to
EPA, we give teeth to the IRS? Wouldn't it be helpful if we
gave the Office of Management and Budget teeth to enforce these
laws with the Federal agencies?
Mr. Daniels. Well, we don't aspire to police powers, though
some people think we think we do. I would leave that to the
wisdom of Congress, sir, although I will say that even apart
from or before any such powers were conferred on us, I think we
have a very heavy responsibility in this area. It is not as
though we are toothless.
A primary reason that I favor the continued integration of
management and budget functions--and this is a debate that has
run for a long time--is precisely that if we ever get it right,
the budget authority and the interactions we have over
something very dear to the hearts of agencies and parts of
agencies, their budget from year to year resides in the very
same place that has the responsibility for oversight or
paperwork reduction, GPEA, in all these other agencies.
That is why we are going to make a determined run at the
goal to strengthen the management side of our operation to
train our people in the requirements of these acts and try to
use the budget hammer, some would call it, to get greater
compliance. You all can work on whether we should also pack
side arms and have other forms of coercion.
Mr. Otter. Well, I pursue that line of questioning as I did
in the subcommittee, as you will recall, simply because I see
that we always advise ourselves that in order to get compliance
from the private sector or from the general citizenry, from the
people, that we have to put teeth in the law.
We are about to hear from two sizable corporations here
that if they had violated the law 487 times, they would not
have got any chance to violate the law 487 times in 2000,
because they would have all been in jail from having violated
the law 872 times in 1998, whether it was affirmative action or
whether it was OSHA or the IRS laws, the tax laws, or any of
the rest of these.
I am wondering, if we are really serious about paperwork
reduction, if we are really serious about making the necessary
good impact on our own government that we are willing to make
on our own participants in the private sector and in the
economy, why aren't we just as enthusiastic and why aren't we
just as willing to champion that same sort of compliance with
our own government?
Thank you, Mr. Chairman.
Mr. Burton. Side arms will be required.
Mr. Ose.
Mr. Ose. Mr. Chairman, thank you. I am tempted to use a
portion of my time to celebrate your birthday today.
Mr. Burton. Do what?
Mr. Ose. To celebrate your birthday today, because I
understand you turned 35.
Mr. Burton. Thirty-nine.
Mr. Ose. But I am not going to sing for you.
Mr. Tom Davis of Virginia. How many times?
Mr. Ose. Nobody laughed.
Happy birthday, Mr. Chairman.
Mr. Burton. Thank you.
Mr. 0'se. That is in the record, right? You got it in the
record?
Mr. Burton. Thirty-nine. Get that in the record, too.
Mr. Ose. This is my time, Mr. Chairman.
Mr. Daniels, I appreciate you coming. You and I have had a
couple of conversations in the past. I do want to touch on a
couple of things.
We had a hearing on April 24th at which many of the
witnesses questioned the requirement for reporting extensive
and unchanged information on an annual basis; that is, the same
information they reported on the previous year's form was the
same that they are reporting on this year's form, in particular
as it relates to Interior and Agriculture issues.
On May 15, I wrote you and Secretary Norton about the
results of our investigation, the Bureau of Reclamation in
particular, and asked for OMB to work with the Interior and
Agricultural Departments to eliminate any duplicative
reporting.
Where do you stand on your analysis of this problem?
Mr. Daniels. We assess it as a general problem, even larger
than your letter suggested. I will be meeting with Secretary
Norton next Friday, and this will be one of the topics that we
take up. I can't tell you this morning how much progress she
will have to report. Certainly the work of the committee
alerted and sensitized her, as well as us.
And certainly an area one of the high-yield opportunities
that I made earlier reference to has got to be, you know,
alleviating the burden for repeated update or refiling of the
same data; and there is work afoot to try to make it possible
for people, or businesses in many cases, to file standard
information in one place that might handle multiple agency
needs, updated only as it changes.
Mr. Ose. Could they do that electronically, too?
Mr. Daniels. Sure.
Mr. Ose. One of the issues that came up in our hearings--
and this related primarily to agricultural use of Bureau of
Reclamation water from the Central Valley project in
California--is that on the forms that were being used by the
Bureau to basically allocate water, it almost seemed as if the
simple addition of a box that a farmer could check that says
``no change from the previous year'' would go far toward giving
these people the time that they need in the fields.
I don't know if you have considered that or not.
Mr. Daniels. I have. And also made earlier mention of the
fact that, in Agriculture particularly, there is--what we are
dealing with, with many programs and an enormous
infrastructure, field offices overlapping and all the rest of
that, which is a completely separate management problem, there
is at least, I think, the strong suspicion of a lot of ``make
work'' and a lot of information being collected that need not
be collected in the first place.
I said earlier it would be a sad mistake to convert from
paper to some simpler electronic fashion information collection
that is unnecessary in the first instance.
Mr. Ose. Your point is very well made.
I met with the FSA employees in the Central Valley,
particularly, in my district about that exact point; and they
would welcome the opportunity to reduce the redundant or
repetitive collection of information of this nature. So I
applaud your efforts on it.
Mr. Daniels. We could use the help of Congress to reducing
the redundant and unnecessary overlap in that agency itself.
When you have separate silos of employees all dealing with the
same farmer but all reporting to different people and all
setting up their own systems, you are going to have multiple
information demand.
Mr. Ose. Your single source idea or your single repository
is a great idea. So I want to compliment you on that.
Mr. Daniels. It may be great, but it is not very popular.
Mr. Ose. Before the light turns red, I want to reiterate
what I said at the beginning and say happy birthday to you, Mr.
Chairman.
Mr. Burton. You are a good friend.
Let me just say to Mr. Daniels, if you have suggestions for
legislative action that would help you do your job better by
streamlining and cutting out duplication, just call us. I mean
there is a number of subjects here that we will be very happy
on both sides of the aisle to do whatever we can. This is not a
political issue in any way.
Ms. Norton.
Ms. Norton. Thank you, Mr. Chairman. I regret that I have
not been here long enough to hear this important testimony.
It's an important hearing for this committee to hold.
I would like to yield my time to Mr. Kanjorski.
Mr. Kanjorski. Thank you very much.
Mr. Daniels, I want to tell you a story of how I got into
something. It is interesting.
I spent time with a former Member who was my dearest
friend, Bill Emerson. We used to cross districts. He was a
Republican. I was a Democrat. We always made it a point, if I
went to his district, we would go to something special, a
laboratory or some Federal installation. If he came to mine, we
would do the same.
When I was in Missouri one time, he was very proud of the
USGS facility that is somewhere in Bill's old district, and we
spent the day there. It was very enlightening, and it could
perhaps give us some guidance here, because I just heard the
chairman mention whether or not we could do something.
When we were mapping the United States some 20 or 25 years
ago, maybe 30 years ago now, of course, the Congress had to
authorize the mapping. It was interesting that an interesting
question arose that exists all the time when we act here in
Congress, whether this is a Federal question or a State
question. There was the contention that they wanted to have a
Federal map of the United States, but ultimately Congress
elected to appeal to States' rights and authorized to pay for a
map that would be awarded and built by the States, and they did
such.
Members may not know this, but when they completed all the
surveys of the United States and they went to reassemble the
United States, it did not fit. Quite frankly, all the
information that was compiled in the lower 48 States just did
not come together. We had to redo the situation at great
expense, and that is a tendency that we have to anticipate
here. If you are going to do something, we should probably get
involved in the Congress when we are authorizing but be very
certain that we analyze out some of our philosophical positions
that can and do cause havoc.
Now, as a result of that, I have been very involved in GIS,
both using it for government planning and structure. I have
found that we are on that same course again, that is in the
Federal Government. In almost every department and bureau they
are, rather than having a central repository for GIS
information, whether it be the Library of Congress, the
Department of Congress, I don't care, some single agency that
is responsible for standardization and for pulling this
information together and to making it available, every
department in every bureau of the government has their own
little GIS system that they are working with and,
unfortunately, a total lack of standardization.
Now, I am certain in my own mind standardization should not
be established by government fiat and government action alone,
and they are well on their way to coordinating both the Federal
Government and the private sector in developing standards. But
they are--that is extremely important.
I am involved with areas now that we are trying to
determine are we going to be doing the GIS system down to an
accuracy of every 3 feet on the surface of the Earth, every 10
feet on the surface of the Earth, every 30 feet. There are all
different measures, different expenses involved. But a great
deal of the limitation is what this information can be used for
and the quantitative savings that will result therefrom.
One of the things I would call your attention to just think
about it, we have over there in some of the black areas of the
government capacity through satellite use to have tremendous
efficiency in siting and locating materials on the face of the
Earth with great accuracy. It is, to my knowledge, that the
private sector is spending hundreds of millions if not billions
of dollars to duplicate that very service that exists right
now.
We would make tremendous strides if, one, we freed up some
of that information. All it takes is the attention of saying
that it is not so radical a secret that it has to be contained
anymore, because they can do it in the private sector, but,
rather than duplicate that expense in the private sector,
actually open up those areas.
I can tell you just in the area of land reclamation and
water treatment in this country we are talking about the
capacity to save billions of dollars in just opening up that
technology, taking and use what we have rather than
reconstructing a commercial-identical force. But even worse
than that, one that has no standardization.
So I think what you could do in management is work to make
sure that we find central information sources, then work with
the private sector to standardize and see that we are not
having mismatches and wasting our money and our time that can't
later on be put together. It would be a tremendous saving just
to begin with, and I could offer any information I have. I am
very well connected in the GIS system, the private sector that
has been doing tremendous work in this country. If we could
just pull the government into it, it would be a phenomenal
advancement we could make.
Final suggestion we would make--I am taking upon myself as
a member of the minority to make these suggestions to a new
administration, but something I have been trying to get some
presence to do for a long time in the Congress, we have a
unique opportunity right now at the beginning of this century
to reexamine the structure of the Federal Government. And with
at least three very vital former Presidents still in existence,
we potentially could use their insight to help us restructure
to be a more functional executive branch of government.
But please don't stop there. Let us have a Hoover
Commission to handle the Federal bureaucracy and the Federal
executive branch of government. But then let's get the Congress
to contemporaneously be working with them so that our structure
fits your structure.
If we want to be efficient, rather than taking individuals
like yourself and having you come up here to 8 or 10 committees
to talk about the same nonsense, we really only need you one
time with the proper function of the committees with the
departments of government. It can't be done in a slow period of
time. But if we pin the model time to year 2008 when we don't
know who the new President will be but certainly it will be a
new President, but we could go about reforming our government
and reshaping our government in a more efficient, effective
manner that would save time, save money, speed up processes,
and also put it functionally more organized, hopefully, to
serve the people better.
You know, I think we have that opportunity. I would suggest
to the new President that this may be something that isn't sexy
and isn't too politically important in a contemporary sense but
could be politically contributing in a great sense if we took
the opportunity at the beginning of this century and feed on
that possibility of getting this government organized better so
we know how to have the interaction occur.
Mr. Burton. Thank you, Mr. Kanjorski.
Did you have a response?
Mr. Daniels. Well, I will take the idea back; and it ought
to be viewed seriously by whatever means. It is a great time
for the Federal Government to examine, and each of its
branches, whether it is properly configured. Because we all
know that, in many ways, it is not. I like the idea of
testifying electronically, if we could work that out.
I am glad to post my comments on the Web site, and every
committee can have them there.
Mr. Burton. The one thing we have all noticed today, Mr.
Daniels, is that you are a very, very good listener.
Mr. Gilman.
Mr. Gilman. Thank you, Mr. Chairman; and thanks for
arranging this birthday celebration by trying to reduce
paperwork in the Federal Government.
I recall when we first had the first hearing on reducing
paperwork, it goes back a number of years, the committee issued
a 400-page report on how do we reduce paperwork. I hope we
don't do the same in this hearing.
But I want to commend our Director, Mitch Daniels, for
attacking a lot of these problems. I see he has touched on the
farm service area, USDA, international trade data, simplified
ways of reporting systems, SEC filings. I hope we will take a
look at court paper filings, and also licensing bureaus
throughout our country have massive amounts of forms that they
require to be filled out.
But I also, in looking ahead at some of the testimony
coming up from Microsoft, they are talking about some areas
that I am not familiar with--hypertext markup lag and hypertext
transport protocols, XML transformers, how applications talk to
each other. Are you familiar with all of those, Mr. Daniels?
Mr. Daniels. Oh, intimately, Congressman.
Mr. Gilman. Certainly I don't know if the committee is, but
it sounds like we are on the verge of getting into some very
highly technical areas that could save us a lot of paperwork
and a lot of money up the road, and we look forward to working
with you.
That is the extent of my comments, Mr. Chairman.
Mr. Burton. Thank you, Mr. Gilman.
We now go to Mr. Davis, who has been very involved in the
high-tech area for a long time as well as politics.
Mr. Tom Davis of Virginia. I am just happy to be here to
celebrate your birthday as well. We appreciate Mr. Daniels
being here.
I am going to be quick, Mitch. We have got a lot of
questions that I think have already been covered in here, and
we have a couple of other panels. Let me just say we have
enjoyed working with your office. We will continue to on a
number of issues.
I just want to say how much I appreciate your candor in
assessing the Federal agencies' GPEA compliance thus far. I
also want to applaud your decision to support the new associate
director for IT and e-government and the President's commitment
to creating a citizen-centric government.
In a hearing with my subcommittee, a hearing we held in
April on the role of State and local CIOs, one point was raised
that relates to the scope of electronic government in the
context of the Federal Government.
Now in local government we do kiosks, and citizens can call
in, but the Federal Government is a little bit different
because there are more interactions between governmental
agencies than between the Federal Government and State
governments. To what extent does OMB's implementation of e-
government priorities account for IT planning and
infrastructure that will interoperate across all of these
areas--citizens, business, interagency, governmental--instead
of just one?
Mr. Daniels. All very, very important. The interagency
issue is a big one. As I mentioned earlier, even within
agencies we have major conductivity and interoperability
issues.
Internally, I am pleased to say that--at least I am told--
that substantial progress is due in the near term in linking
first gov, which is meant to be the central Web site of the
Federal Government, to thousands of local governments, many of
whom are far ahead of the Federal Government in this area. I am
told this is a task that on which some real progress is
imminent, and we will work to make that so.
It could be that we can break some logjams or at least open
much wider accessibility by sort of leveraging the connections
that citizens already have convenient to them locally or at
their State level simply by making the appropriate linkages.
Congressman Kanjorski made a number of important points.
But I guess one that really sticks with me is that, my view,
anyway, sophistication in systems equals accessibility and
simplicity. And just as an amateur at this, as a veteran of
making some mistakes made in business and elsewhere, I will be
very, very skeptical of sophisticated systems that only a
handful of, you know, the anointed can operate. I trust that
the people who will follow on other panels fully understand
that and much of the genius that they bring to this subject
really comes from making, through the most sophisticated tools
available, systems which any of us, even I, can manipulate
easily. So----
Mr. Tom Davis of Virginia. Again, I appreciate the
proactive role you are taking over there. I look forward to
working with you.
Mr. Burton. Thank you, Mr. Daniels. I have known you for so
long, I just feel I ought to call you Mitch. I knew you when
you and I were both young. You still are.
Let me just say, thank you very much for being here. We
really appreciate it, and we look forward to working with you
to try to solve some these problems. As I said before, if there
is anything legislatively that you think we ought to undertake
to help you, just give us a call.
Mr. Daniels. Thank you, and thank the whole committee.
Mr. Burton. Our next panel, we would like to welcome to the
table Sue Bostrom and Curt Kolcun. Sue is from Cisco Systems
and Mr. Kolcun is from Microsoft, two of the leaders in this
industry, and we are anxious to have you give us the solutions
to all of our problems.
We normally swear in witnesses, but I don't think today it
is necessary. So we will just start with Ms. Bostrom and ask if
you have an opening statement you'd like to make.
STATEMENTS OF SUE BOSTROM, SENIOR VICE PRESIDENT OF THE
INTERNET BUSINESS SOLUTIONS GROUP [IBSG], CISCO SYSTEMS; AND
CURT KOLCUN, E-GOVERNMENT DIRECTOR, MICROSOFT CORP.
Ms. Bostrom. Yes, I do, Mr. Chairman.
Thank you, Mr. Chairman and members of the committee. I am
Sue Bostrom. I am the senior vice president of the Internet
Business Solutions Group at Cisco. First of all, I would like
to start out and thank you for your support and commitment and
focus on this important issue of how e-government initiatives
can be accelerated across the Federal Government.
I will make a short statement, but the full record of my
statement is on file with the committee.
In terms of some background, over the last 6 or 7 years at
Cisco, we have used the Internet to really transform the way
that we do business both in terms of employee-facing
applications, our supply chain, customer-facing applications,
really across the entire way that we operate as a company; and
what it has resulted in is a phenomenal bottom-line impact for
the corporation. Last year alone, we saved approximately $1.4
billion on a revenue base of $18 billion. In the process, we
also increased customer satisfaction by over 25 percent.
Over the last few years, my team at Cisco has met with
about 75 percent of Fortune 250 leaders, CEOs as well as
leaders from government organizations, both here in the United
States as well as across the globe. What has been interesting
is that, while 3 or 4 years ago it was typically the CIO or the
network manager, network director that was interested in what
technology could do, now we are finding that it is business and
government leaders that are interested in what technology can
do to transform the way that they operate; and, in fact, over
the last 6 months we have had over 300 of these folks visit.
Other private sector companies beyond Cisco are also seeing
what the transformations of the Internet can do. I think many
of you are probably aware of Jack Welch's comments at GE is
about how the Internet is now on his list of one, two, three
and four top priorities for the company; and he is expecting a
$1.6 billion bottom-line impact for General Electric alone.
What we have seen at Cisco is that the way--one of the ways
to think about the possibilities of the Internet, in addition
to improving service levels for citizens or constituents or
customers, there is also the opportunity to have this return on
investment. We found that there are models that can be used,
whether you are looking at what it costs to process a travel
and expense report going from $50 per expense report to $2 or
whether it is the entire process of how you manage a complete
process across the organization. There are significant
opportunities to have direct bottom-line benefits. We have seen
this both in the private and public sector.
One of the public sector examples I like to use is what we
have seen in the State of Colorado where Governor Owens has
really embraced the Internet as a tool to link agencies across
the State. They took over 700 licensing and permitting
operations and combined them to have a single face to the
citizenry. Now, what has been required, of course, is a
strategic plan. They also brought in an outside private sector
CTO for a period of time, and they drove coordination across 20
different agencies, which is now resulting in about a $15 to
$25 million bottom-line impact for the State and, of course,
taxpayer savings.
I would like to suggest that, based on what we have seen at
Cisco and some public sector organizations, there are about
five key success factors that I believe could be very helpful
in helping the Federal Government accelerate the initiatives
already under way.
In order of priority, the first one is very strong, visible
top-down leadership. What I mean by this is both the Congress
as well as the administration as well as agency secretaries.
While I think that in both the private and public sector we
like to believe that is all the issue or opportunity of the
CIO, in fact, to transform some of the processes that you were
referring to earlier it really requires an agency secretary and
the entire staff there that gets behind the redesign and the
reorganization opportunities.
The second major key success factor is around budgeting and
funding and ensuring that there are mechanisms that can
facilitate flexible and fast funding of Internet initiatives.
With the speed with which technology and applications are
changing, the idea of committing to a plan that could be 3 to 4
years out is somewhat concerning in that maybe in a few months
there could be applications that the agency would want to take
advantage of.
The third component of this is around accountability, and,
again, who is held responsible. What we have seen is that
business or functional leaders are really the folks that need
to drive the fundamental change within the organization, and
those are the people that we have seen from our experience are
the ones that should be held accountable with the IT
executives.
Fourth was a point you have been mentioning quite a bit
around enterprise priorities and architecture. I think that we
have seen the successful organizations almost have an approach
of where the CIO or the chief technical officer is almost like
a benevolent dictator when it comes to setting enterprise
standards across the organization. You might want to think
about it like a highway and cars, where you want that chief
technical officer to be responsible for what the highway looks
like, how large it will be, what the standards will be,
allowing each one of the agencies or functional owners to build
cars so whether it be a Volkswagen or Ferrari it can scale on
that highway infrastructure.
The fifth point is something that we refer to at Cisco as
ruthless execution against these initiatives. It is very
possible in the Internet age to have 90 to 120 projects and
determine what is working, what is not working and make very
aggressive changes. Many of the organizations and customers
that I talk to may not feel comfortable with the word
``ruthless,'' and they have tried to suggest terms like
``relentless,'' but that actually means something quite
different, as I am sure you all know.
So the point of saying what are the projects, how can they
be implemented, what's working, what is not, and putting the
timeframe, the speed which is possible on the Internet into
some of these initiatives across the Federal Government would
be a significant advantage.
So, in summary, I think that you do all play very
significant roles in terms of helping to break through some of
the perceived barriers and bring together some of the silo
thinking that is natural in terms of this organizational
structures that currently exist. The opportunities of the
Internet are significant, whether it be within an agency or
within this House itself or within your own administrative
functions of your office. We at Cisco look forward to seeing
more examples within the Federal Government's base, and we
stand ready to help in any way that we can. Thank you.
Mr. Burton. Thank you, Ms. Bostrom.
[The prepared statement of Ms. Bostrom follows:]
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Mr. Burton. Mr.--I want to make sure I pronounce that
correctly--Kolcun.
Mr. Kolcun. Good morning, Chairman Burton and members of
the committee. I am Curt Kolcun. I am Microsoft's e-government
director for Microsoft's government sales organization. In my
role, I am responsible for implementing Microsoft's e-
government strategy with Federal as well as State and local
government customers. Thank you for this opportunity to appear
before you to discuss Microsoft's e-government vision and how
Internet standard technologies are reshaping business and
governments around the world.
E-government is a deceptively simple term to use to
describe something remarkably broad. Essentially, e-government
is about doing the business of government better, more
efficiently and more effectively.
Microsoft appreciates the responsibility government
stewards--particularly those who make spending decisions--have
to taxpayers to spends tax dollars wisely and responsibly.
Which problems government chooses to address and how government
addresses those problems are questions for public debate that
will ultimately be decided by elected officials at all levels
of government. But there is no question of whether or not
government ought to do its business efficiently and
economically, and this is where e-government has so much to
offer those serving in the public trust.
A revolution is upon us. Revolutions are a way of life in
the computer industry. Only 20 years ago the world was in the
mainframe era. Few people had access to or used computers. The
PC, the graphical user interface, and the Internet, though,
transformed the personal computer into a mass-market product.
Within this information revolution, there is a
transformation under way for governments as well. The first
phase of this revolution was initially focused on government
agencies and organizations creating a Web presence with read-
only content and organizational information. Today, we are in
phase two, which began when some government sites made simple
forms available online.
But we are moving to a final phase of e-government
transformation and one in which the greatest opportunity lies.
That is the digital transformation phase. It is in this phase
that governments will be able to interact with their customers
by accepting electronic forms, information requests and
payments from the Web via PCs, wireless handheld devices, via
telephones and on Web-enabled TVs. In this phase, the digital
economy will be represented by new constellations of computers,
devices and services all working together to deliver broader,
richer solutions to everyday challenges.
At the heart of the digital transformation phase is a new
language for the Web, already widely deployed, called
eXtensible Markup Language [XML]. XML is an open industry
standard managed by the World Wide Web Consortium. That is, no
company owns it, controls it or licenses it. Just as the Web
revolutionized how people talk to applications, XML transforms
how applications talk to one other.
But what is more important than the technology itself is
how government businesses and their customers will benefit from
it. The industry is creating a new type of software that use
XML to provide Web-based service that will enable consumers to
receive and act on information any time, any place and with any
device.
To illustrate the power of XML Web services, one can
consider the multiple interactions with government new
homeowners might face. They might change their address,
register their car, register to vote, set up utilities, ensure
government benefits follow them, announce their presence to the
new tax jurisdiction and enroll their children in school. These
services are independently managed by various government
agencies and public utilities.
Now imagine if each of these government agents were to use
XML provider service and instead of having to repeat that same
information at multiple government agencies on multiple forms
the new homeowner simply enters her new address once and the
relevant government agencies and utilities will have access and
act on that information securely, offering choices where
appropriate.
Today, government services are provided through a variety
of channels including retailers, banks and the post office. The
government service network that has evolved to reach citizens
through multiple channels in the physical world is instructive
on how government should reach citizens in the virtual world.
Somebody who banks over the Internet should be able to pay
their bills and taxes through their online financial
institutions. Somebody who buys their fishing gear from an e-
commerce site should be able to buy their fishing license at
the same time from that same Web merchant.
Citizens can interact with government not only through
government Web sites but on e-commerce sights or public portals
such as Yahoo, AOL or Microsoft's MSN. It is in the
government's interest to reach citizens through as many service
provider channels as possible. Public portals can reach as many
citizens in 1 day as a government Web site can in a month or
more.
As an example, the United Kingdom Cabinet Office recently
embarked on a groundbreaking new XML government gateway project
to deliver secure Internet transactions to its citizens and
businesses. Let's say that a Briton needs to send a Value Added
Tax form to the government. He would simply use the VAT
application, fill in the form and hit the send button. The
information is electronically signed and relayed to the
government gateway which authenticates it and redirects it to
the appropriate Customs and Excise system.
In summary, there are two things we should do to reach the
full potential e-government has to offer in the United States.
First is adopt XML as an integration standard for government
computer systems; and, second, make government services and
programs that citizens and business rely on available through
multiple Web-based channels.
Microsoft's e-government vision is to enable the public
sector to lead the information society by providing it with
great software to deliver services that can be accessed any
time, anywhere and from any device. Working within public-
private partnerships and in consortiums, Microsoft aims to
ensure that its solutions and those of its partners are able to
empower citizens, businesses, government employees and elected
officials.
Thank you, Mr. Chairman and members of the committee.
Mr. Burton. Thank you, Mr. Kolcun.
[The prepared statement of Mr. Kolcun follows:]
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Mr. Burton. Let me start off by asking you, Ms. Bostrom,
you said you need a benevolent dictator, or words to that
effect. So I presume what you are saying is that at the
executive level in government for the executive branch that you
have to have is somebody up there that is responsible, who can
dictate to all the agency heads and department heads this is
the system that we are going to use, approach we are going to
use, and you all have to follow it. Otherwise, you are not
going to have the kind of coordination that you think is
necessary, is that correct?
Ms. Bostrom. Yes.
What I was referring to was there is--as I mentioned, there
are almost two levels of technology. One is the underpinning
infrastructure that is required. So that may be the data base,
it could be the network connectivity, it could be the legacy
systems. And I think that what Director Daniels was talking
about earlier is that there needs to be some level of
standardization that is established so that various systems and
agencies can talk to one another.
Even with standardization at that level, there is still
quite a bit of flexibility and autonomy that can be allowed
then at the agency level or at the functional level. Because,
based on the standards, the data can communicate with each
other. So at that base level of standards it usually does
require a decision on what those standards will be.
And the word benevolent was very explicit there because
typically the way this is approached in the private sector and
also in some public sector environments is a group of
individuals gives input as to what might be required, and then
some final decisions are made. So it is actually quite
collaborative, but at the end of the day there are decisions
that are adhered to.
Mr. Burton. I might just say that I know that Mr. Daniels
is gone, but whatever recommendations both of you have for a
basic approach to dealing with this problem of governmentwide
we will submit to them for their perusal; and, hopefully, they
will take that to heart.
You, Mr. Kolcun, were talking about the UK gateway project;
and that was, I am sure, a major undertaking. The UK government
is a lot smaller than the government of the United States, but
I presume that the approach that you took would be a similar
approach to the U.S. Government. Can you tell us a little bit
about that, the difficulty that you encountered in dealing with
their government and how that would translate into dealing with
ours?
Mr. Kolcun. Certainly. You are correct, Mr. Chairman, that
the government in the UK, their system was designed to support
about 60 million citizens. Their approach in looking at how
they would interface to the existing legacy of the older
systems that were there within their various departments was to
standardize on XML through their government organization
through what they called an electronic government framework and
interoperability framework that received input from all the
agencies and from all the CIOs to define the XML interfaces to
the existing systems that they had.
Their approach was, rather than rearchitecting or replacing
the existing investment that they had in technology, they would
use the secure gateway that communicated via XML with citizens
through public portals as well as through business and
applications. So this gateway, run through the office of the e-
envoy, manages these transactions; and they approached it from
the standpoint of being able to facilitate interaction between
the existing systems that were there and securely exchanging
data through this gateway using the XML technology that I
mentioned in my testimony.
Mr. Burton. So I gather from what you just said that our
government might be able to utilize a lot of the technology
that they already have by this gateway approach that you are
talking about where you could take the new technologies and
link them in, is that correct?
Mr. Kolcun. That is correct. The XML technology will allow
for the access to those legacy systems. Really, the effort is
opening up that back-office data and make it available to the
front office. So through efforts and through discussions that
we have started with the XML Working Group of the Federal CIO
Council, this has been a proposal that we have provided for
government to move forward and to open up communications
between the existing systems that we have today without
replacing them.
Mr. Burton. Well, that is new information for me, because I
thought we would probably have to replace a great deal of what
we already had.
They had a target date of 2005 over there, and I guess that
is achievable goal. We have a target date of 2003, and we are
not anywhere near there. Do either one of you have suggestions
on how we can meet that goal? Is that a realistic goal?
Why don't you start, Ms. Bostrom.
Ms. Bostrom. Well, I think that, based on our experience, I
would always suggest an aggressive goal is always a good goal.
I believe that one of the factors that I think there was
quite a bit of discussion on a little bit earlier was what do
you target first and what really makes sense to put on the Web,
etc. So what I think would be most effective would be to very
clearly establish the top priorities.
So if you said that by 2003 these either key transactions
or key interfaces, whether they be government agency to
employee or to citizen, our top priority is where we are going
to get the greatest impact in the shortest period of time and
let's strive very aggressively for that by 2003. I think that
would be a very achievable goal and would demonstrate success
that could then be rolled out more aggressively across other
groups that were not impacted as dramatically in the near term.
Mr. Kolcun. I would say, as to Ms. Bostrom's statement,
that we see the same thing in the UK government in the effort
in the work done to look at quick wins and to analyze the
systems we have today that will have the most impact on the
citizen as far as their interactions with government. I think
that by selecting pilots and working with progressive States,
Colorado, the State of Washington, the State of Pennsylvania,
who have some systems in place already, I think that we can
quickly do this.
I would point out that the e-government gateway was
developed in 15 weeks of time with about 50 developers. So the
technology has evolved to allow us to do these things quickly;
and that allows us to get these quick wins, demonstrate success
and move forward in a structured fashion.
Mr. Burton. Fifteen weeks.
Mr. Kanjorski.
Mr. Kanjorski. Before we get to that on the Federal
Government, let me say some distinction I see between the UK
and the United States is different layers of government. We
have 50 States in between that they don't have.
Second, I don't know if they have resolved the security
problem. But we are still wrestling over that as to what level
of security we are going to go to; and I think our intelligence
agencies, both the CIA and the FBI, want to constrain to what
level we go to so that they can utilize this information and
intercept it.
So doesn't that bring us to a forceful philosophical
argument that the country has to undergo as to what information
should be made available to intelligence agencies and what type
of protection can we put in place or shall we put in place? And
isn't that a decision under our system that constitutionally
has to be made by the Congress?
Mr. Kolcun. Sir, I would address that.
I agree that security and privacy are key points to e-
government as well as government in general, and they continue
to be. In the UK, they decided on an implementation of a public
key infrastructure with digital certificates. And I think the
determination for government to look at is determining what
level of security need be applied for the type of information
interaction that the citizen or consumers are doing with the
system itself.
Mr. Kanjorski. As I understand, we have not agreed to go to
the amount of security that Europe has accepted as a standard.
The United States wants, our agencies want a much lower
standard so that they can exercise their inherent right as they
define it to intercept communications between citizens and
citizens and the government. Is that not correct?
Mr. Kolcun. I am not familiar with that, sir.
Mr. Kanjorski. I don't want to appear to be against it. If
I were young again, I would hope to be engaged in your type of
activity. It offers tremendous efficiencies and growth of
wealth and protection of people's rights if we do it right.
But I am trying to point out some of the frustrations on
this side and in the Congress we get, one being that I had just
recently gone through a hearing with securities commissions to
the 50 States. And for stock fraud, for instance, in this
country we still don't have a single repository of information
on individuals that commit intrastate fraud. There are some
frauds committed, and the same individual goes to each
individual State, and some have practiced in 13 and 15 States.
And any State in the Union can't find out that they have been
prosecuted and have provided that.
Now that necessitates standardization and clearinghouse
operations that aren't very sophisticated really, but the fact
that we don't have them raises the question why. And I really
think it is an argument--two things, one, privacy and, two,
that jealousy of States' rights as opposed to national
standards and national rights. It seems to me the Congress and
the people have to engage in that debate and get over it rather
quickly.
Whereas in the UK they have had the debate. They have
decided they trust their government. They decide their
government will impart a standard that is sufficient to protect
people's privacy, and they have moved on. Here, every day that
issue comes up in committee hearings or on the floor; and we
really haven't developed a philosophical standard consistent in
the country to allow you all to move ahead and put in a system.
But I am worried about doing partial things that can't
complete the action. And in testimony you said to try and
define something that is reachable. I can see some areas that
we could do that with, probably cause some efficiencies in
government but wouldn't necessarily allow us to have the
opportunity to have a superstructure in place to really move
ahead with what we are all hoping will be a tremendous e-
government facility in the United States of a highly
sophisticated nature.
I am just wondering whether or not is it up to your
companies and your industry and your professions to come
forward and start shaming the Congress and the American people
into addressing some of these political and philosophical
issues that no longer can be put under the rug and ignored but
must be faced, decided upon, and then moving out from there.
Other than that, aren't we sort of just skating around hoping
to do little things but not in context and not comprehensively?
Ms. Bostrom. Well, Mr. Kanjorski, I believe that there is
quite a bit of truth in the statement that you make. I believe
that the challenge that the Federal Government faces or the
public sector faces here in the United States is very similar
to similar challenges that are faced in the private sector, one
being that there is almost simultaneous initiatives that must
go on, one area being the rearchitecture of the things that you
are describing, the data bases, and combining information. And
many of those are philosophical, longer term decisions that
must be made.
At the same time, though, there is the opportunity to
perform initiatives and take on initiatives that will begin to
offer quick wins. What I found in the private sector is that
oftentimes those quick wins can accelerate change in that core
rearchitecture. Because, as you see what is possible, whether
it be private sector organizations like Cisco or Microsoft or
whether it be the citizens, they begin to see what is possible
and begin to help accelerate the architectural or structural,
philosophical decisions that need to occur.
So my thinking would be that there needs to be simultaneous
action at both levels, and I think for any one situation what
ultimately drives the kind of transformation I think you and I
are hoping for I think time will tell.
Mr. Kanjorski. Yes. And I just make the comment that the
difference between the private sector and government is that
the private sector is politically an authoritarian
dictatorship. That is why it gets done. The CEO says it shall
be done, and the implementation gets it done.
Unfortunately--or fortunately--government is a democratic
process--that could be a bad quotation--and it makes it much
more difficult.
But what you are suggesting, as I understand it, is for us
to identify something that can be rather quickly resolved and
handled with your new technology that will create the dawn to
create the political sympathy both in the citizenry and in the
Congress to think about maybe appointing an e-government czar
to help us, but under constraints, but building on one win or
several wins and successes that will trust the authority to go
there until proven otherwise to start implementing the entire
system. Is that what you--taking care of the different
structures of the private sector?
Ms. Bostrom. I think there needs to be a mechanism,
whatever it is, that helps to establish these standards. In
addition, there needs to be accountability, whether it be at
the agency level or otherwise, where the agency heads or
functional heads are being held responsible for helping to
drive these initiatives. So not a central point of control from
that perspective. But I think that could certainly be helpful
in leveraging a lot of the good work that has already been done
within agencies and accelerating more work to occur.
Mr. Burton. We have to go to Mr. Davis. He has a luncheon.
Mr. Davis.
Mr. Tom Davis of Virginia. Thank you.
Let me ask both of you, from the work of the full committee
staff and my staff have done in examining the progress of the
Federal Government with respect to implementing the GPA and
thinking outside the traditional stovepipe information manage
the structure, the progress of agencies in implementing the GPA
as the first phase of an e-government we think is uneven at
best. Would you give me a private sector perspective on what
would be the preliminary steps that any organization, including
the Federal Government, would take to achieve the cost
efficiencies and improve services that have been realized in
the business world?
Start, Mr. Kolcun, with you.
Mr. Kolcun. OK. I think that some of the things that we
have talked about, Congressman, already are the support and--
the management support for looking at the process. It is one
thing to be able to place a form online, but that form
represents a process, and you have to make sure that when we
look at this form and put these forms online that we are also
analyzing the process. What is the process? Is it a necessary
process?
I know at Microsoft when we moved--we use the term ``eat
our own dog food'' when we use our own technology to change.
When we moved our systems online, the chief executive of our
company was intimately involved in looking at the process and
questioning the process to find out if it was involved and then
applying technology accordingly.
I think that at the Federal level we need to really elevate
the CIOs to be able to do that and look to that organization to
be able to help and be tied to the strong management
organization to be able to move these initiatives forward.
Mr. Tom Davis of Virginia. OK.
Ms. Bostrom. Congressman Davis, I think the approach that I
might suggest in an agency that isn't moving quite as quickly
as one might like, I would say first is establishing what the
top priorities are. By that I mean, in a quite simple way, we
talk to the citizens that the agency serves. I would talk to
the employees, and I would find out what are the two or three
key things that really make it difficult to do business with
that agency or to be an employee within that agency. And then I
would prioritize those initiatives based on the ability for the
Internet or Internet capabilities to make the difference there
as well as how easy they are to implement. So, in other words,
how many philosophical debates need to occur before progress
can be made?
Second, I would hold the accountability with the functional
executives inside of that agency and create an IT functional
partnership so that the people that are required to change the
process have skin in the game to help make it happen and
understand what the returns can be for their organization.
And, finally, we put a terrific amount of emphasis on near-
term tracking and results and really looking over, whether it
is 90 days, 120 days or 6 months or 9 months, what progress is
being made so that corrective action could occur very quickly.
Mr. Tom Davis of Virginia. Thank you. That is all I have.
Mrs. Morella [presiding]. Thank you, Mr. Davis.
I am sorry that I wasn't here to hear your testimony, but,
of course, I have your written testimony. It is difficult when
you have three different committees meeting at the same time.
Spencer Abraham was speaking to us on the energy policy,
which actually ties in, because there is this demonstration
program called, let's see, Don't Pollute, E-commute, which is
being done with businesses where they can store up the energy
that they have preserved and sell it and keep it in the bank. I
just think the idea is great, and the District of Columbia
region is part of that.
But I would like to ask you both maybe the same question.
In order to receive most government services, citizens must
first provide some personal information. The idea of the
government agency sharing all of this information over the
Internet with other government Web sites sounds like it might
present security problems. So I just wonder how you would
respond to that. When the citizen wants to work with government
online, how do you protect their information and what control
will they have to limit the way their information is handled?
That security and privacy is one of the biggest issues. I know
that Mr. Davis shares that, since we have worked on this in the
past.
Maybe, Mr. Kolcun, you want to respond first.
Mr. Kolcun. Thank you, Congresswoman.
Yes, I would point out that, as we discussed, security and
privacy are key aspects of e-government. Some of the same laws
for security in the sharing of information between agencies
exists today, and those same laws would still apply in the
Internet world.
I know that has been a lot of discussion around privacy and
initiatives such as the Platform for Privacy Preferences, P3P,
which actually allows the citizen to determine what type of
information they would like to provide in the commercial world.
So as a user I can determine and set preferences on my computer
to say that I want this Web site to get this type of
information or I don't. And if I access the site that tries to
get that information, I will get the warning to say that it is
trying to get that information, and it won't allow that to
happen.
From the government perspective, the issue of privacy also
needs to be included in privacy statements that we have today
on our government Web sites. And the point I will make, as far
as government being able to monitor the sharing of information,
is that, from the technology perspective, we will be able to
apply audit controls to that information in ways that we have
not been able to in the paper world.
So I would say that the existing laws and regulations we
have will be able to be applied more efficiently and more
effectively with Internet technology.
Mrs. Morella. That is if we implement the current laws that
we do have, and I think that has been one of our difficulties
with the Federal agencies.
Ms. Bostrom.
Ms. Bostrom. Congresswoman Morella, on the security issue,
I believe that, like you, I have concerns about the feelings of
citizens in terms of providing information online. There is
certainly the technology that can ensure that citizens will
feel that the information they have provided is secure and that
will only go to certain Web sites. But at the end of the day
what I think is required is education around what is available,
what is possible.
Referring back to the point that you made, Mr. Kanjorski,
that you made earlier about the comfort level that the average
person has with technology, I think it will require some
education so that individuals will know that when they provide
information exactly where does it go. I must also say, though,
in the paper world oftentimes you provide information and you
have no idea where it goes. So I think that same form of
education will be required so that people understand that the
technology is in fact providing them with greater privacy and
security than in some cases they may have had in the paper
world.
Mrs. Morella. Thank you.
I will now defer to Mr. Kanjorski for another round of
questioning, if he has any.
Mr. Kanjorski. Let me ask a question. Something did disturb
me. Most recently, within the last 2 years I think, one of our
national core manufacturers inserted a chip in an automobile
that kept track of where the automobile was and the processes
it was going under, supposedly for better engineering purposes,
to have a sample test, but unbeknownst to the buyers. I am sure
it shook up some people that found out that their activities
could being traced that thoroughly with just the addition of a
very cheap chip and that in fact it was monitored and therefore
their information or their privacy was in some way invaded
unbeknownst to them.
I think there are enough stories out of that happening even
in the private sector, that adding on the natural suspicion of
government and the black helicopter conspiracy that some people
have of government that I agree with you that if you could
undertake that as a corporate contribution to the U.S.
Government to really educate the American people that would
probably be the greatest contribution you could make.
There are a high number of people in this country that are
fundamentally somewhat ignorant of new technology and the use
of it and even the potential use of it but in that ignorance
can only imagine or apply their wildest imagination. Therefore,
in protection of what they consider a very important right, and
I do, too, their privacy, they'd rather have it all.
They are a large segment of our population we have to deal
with and have an obligation to be fair with in implementing and
passing laws. So, if I had my way, I think the great
contribution to the government has been made by C-SPAN. If
people can at least see what we do, make some judgments of how
ridiculous we are sometimes, and maybe if we had a C-SPAN of
high technology, it wouldn't be bad. I mean, it would start
raising the level, if you will, of some people to understand,
some people I am talking about are old codgers like me that
have been born and been in the generation long enough to know
and think that most of this is awfully new stuff. I guess it is
when you think about it. It can be frightening to those who
resist change or are traditionalists.
I guess I am interested in how fast we could get there,
what we could do to create that ease, that political comfort
level and then to have an understanding of whether there are
functional or fundamental changes in government and
organization that have to be made. I think we need a national
repository of information, as opposed to having it--I sort of
analogize it to the Yucca Mountain. Would you rather have all
the nuclear waste in the Yucca Mountain or do you want it at
110 nuclear plant sites around the country? It is tough to make
the decision, but the decision has to be made. I tend to come
down to I would rather have a single place that I have to
protect, rather than having to protect 120 or a number of
sites.
This information is just too scattered, too unstandardized,
requires too much programming to interface with the material.
I am working on a program in the Commonwealth of
Pennsylvania now, on applications for welfare programs that are
interactive, and I am not too impressed with the idea that they
want to take a 19-year-old program and try to update it because
it has a great deal of material in it. But in the updating of
it, it creates ever so many more likelihoods for error and
mistakes to be in the system.
I think we have to. But what does impress me is that it is
interactive so that, when you work, you can ask a question and
you don't have to necessarily read the answer; it orally can
come to you. And to the people on welfare, that is a much
larger percentage of the population that are functionally
illiterate than the general population. So at least we are
taking into the consideration that they may not have the
capacity to type or even spell or punctuate correctly and can
still extract the information.
I would hope that is where government sensitivity is,
knowing that we have this generational and educational span
that we have to get over and to make it--we could do the e-
world of the future. But then those of us that are old duffers
wouldn't be part of the world, and we would like to be part of
that world.
So anything that your companies--and I have respect,
tremendous respect, for both of them; if you can interact with
the government some special way, make sure that we constantly
change and grow and adapt to the flexibility of that tremendous
technological change.
One of our problems in government very often is that we set
upon this course you talk about, 5 years; by the time we
implement it, it is obsolete. It is useless and stupid and
expensive, and other breakthroughs have occurred in the
meantime; but we were too inflexible either because of our
bidding process and our contracting process or implementation
process to understand that.
We are dealing with a new world, almost instantaneous
change and breakthroughs and new things happening, and yet we
are operating on a very slow horse and buggy, and we are having
difficulty getting into the speed age. So you can help us more
than we can help you.
Thank you.
Mr. Burton [presiding]. Well, thank you, Mr. Kanjorski.
Let me just thank both of you very much. As you can tell
from our questions probably, we are neophytes in this area, and
you folks are the experts. If you have suggestions--and I made
the same comment to the head of OMB, Mr. Daniels, if you have
suggestions that you think we ought to take a look at and try
to come up with some kind of a plan to deal with this problem,
we would sure like to have it. We will make sure that Mr. Mitch
Daniels at OMB, as well as the leaders here in the Congress,
can have it so we can get into the 21st century, as we should.
We really, really appreciate--and, once again, Kevin,
thanks for all your help on this. He worked very hard on this.
Thanks a lot.
Our next panel is Joel Willemssen from GAO; John Osterholz
from DOD; Norma St. Claire from DOD; and Jim Flyzik--is that
correct--Jim Flyzik from Treasury. Would you please--I am
sorry; I guess we have others here we haven't included.
OK, 1 second.
Forgive me. Joel Willemssen, Jim Flyzik, John Mitchell,
John Osterholz, and Norma St. Claire.
Since we are going to be asking you to give testimony on
what you are doing, I think I will have you sworn, so we have
it for the record. Will you all please stand and raise your
right hands? Is somebody back there pointing a finger? Do you
want to be sworn as well.
Mr. Mitchell. The chief and commissioned officer has asked
to.
Mr. Burton. Oh, sure.
[Witnesses sworn.]
Mr. Burton. We'll start with you, Mr. Willemssen. You have
an opening statement.
STATEMENTS OF JOEL WILLEMSSEN, MANAGING DIRECTOR, INFORMATION
TECHNOLOGY ISSUES, GENERAL ACCOUNTING OFFICE; JIM FLYZIK,
ACTING ASSISTANT SECRETARY FOR MANAGEMENT AND CHIEF INFORMATION
OFFICER, U.S. DEPARTMENT OF THE TREASURY; JOHN MITCHELL, DEPUTY
DIRECTOR, U.S. MINT; JOHN L. OSTERHOLZ, PRINCIPAL DEPUTY CHIEF
INFORMATION OFFICER, U.S. DEPARTMENT OF DEFENSE; AND NORMA J.
ST. CLAIRE, DIRECTOR, INFORMATION MANAGEMENT FOR PERSONNEL AND
READINESS, OFFICE OF THE SECRETARY OF DEFENSE
Mr. Willemssen. Thank you, Mr. Chairman. I'll briefly
summarize our statement.
As requested, we looked at the GPEA plans for three
departments and agencies--Treasury, EPA, and Defense. We found
that the plans submitted by Treasury and EPA generally provided
the kind of information specified by OMB.
For example, in its plan, Treasury pointed out the
criticality of its electronic activities in fundamentally
redefining how it performs its missions. Excluding IRS,
Treasury identified more than 300 information collection
processes that could be done electronically rather than by
paper.
In its submission, EPA highlighted that it was undertaking
several activities to provide electronic services, including
developing an overall computer network as a central focal point
for electronic reporting and also improving computer security
weaknesses, which we previously reported on.
Regarding Defense, its plan did not include a description
of the Department's overall strategy. DOD officials could not
provide us with documentation specifically addressing a
Department-wide implementation strategy. In addition, in taking
a look at DOD's submission, we found indications of inaccurate,
incomplete, or duplicative data. In those cases, Department
officials agreed to followup to correct potential
discrepancies.
Speaking more globally, from a governmentwide perspective,
we see several challenges that Federal departments and agencies
are facing in meeting the goal of providing services
electronically.
First, security and privacy assurances must be provided
through the use of public key infrastructure technology,
especially for sensitive transactions. That will be needed very
critically as Federal agencies move forward in this area.
Second, it's going to be important to adequately plan and
implement computer network and telecommunications
infrastructures to provide the capacity and connectivity needed
to support increased electronic traffic.
Third, agencies will need adequate capabilities for
storing, retrieving, and disposing of electronic records.
Fourth, agencies are going to have to implement disciplined
investment management strategies to ensure that the full cost
of providing electronic filing and record keeping are examined
within the context of the benefits of doing so.
And, fifth, agencies need to make sure that they have
addressed their IT human capital needs so that these systems
can not only operate effectively, but they can provide
oversight of contractors developing the systems for them.
OMB is also going to be challenged in its role of ensuring
that agencies comply with the law. The plans that we looked at,
that were submitted by the agencies, really don't provide
sufficient information with which to assess the strategic
activities and other tasks expected to be performed and
schedules and milestones for completing those tasks.
Accordingly, from here on out, OMB may want to consider
proposing more comprehensive agency status reporting so that
they, OMB, will have a sense, especially from a priority
perspective, on where those agencies stand and that they are
pursuing the most cost-beneficial opportunities for moving from
paper to electronic submissions.
That concludes the summary of my statement. I will be
pleased to address any questions you may have.
Mr. Burton. Thank you sir.
[The prepared statement of Mr. Willemssen follows:]
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Mr. Burton. Mr. Flyzik.
Mr. Flyzik. Mr. Chairman. First of all, happy birthday.
Mr. Chairman, members of the committee, my complete record
will be submitted. I will summarize briefly here.
I do appreciate the opportunity to appear today to discuss
the e-government initiatives within Treasury and our efforts to
comply with GPEA, and also how GPEA fits in our overall
information technology strategic plan.
I want to thank you, Mr. Chairman, and the other members
for your continued support and encouragement toward improving
information technology management and reform in the government.
As many of you know, I serve as the Acting Assistant
Secretary for Management and the Chief Information Officer at
the Treasury Department. I have also served, since February
1998, as the vice chair of the Federal CIO Council where I play
a key role in the strategic direction of the Council and the
Federal Government's use of information technology.
At Treasury, we are making great strides in harnessing the
power of the Internet to improve customer service, mission
effectiveness, and all of our operating efficiencies.
CIO Council's strategic plan places e-government at the
forefront. The Department is aggressively and proactively
developing plans and launching new initiatives. We intend to be
a leader in the Federal Government in electronic government. We
are supporting the use of Public Key Infrastructures, Virtual
Private Networks, SmartCard and Portal technology to put in
place the platform to do everything we do electronically.
As an example, we are now delivering new value to citizens,
businesses and government partners through the Financial
Management Services' pay.gov initiative. It is an Internet
portal and transaction engine that will offer a package of
electronic financial services to assist all agencies.
Services of pay.gov will allow for collections, form
submittals, bill presentment, authentication and agency
reporting, all electronically. Pay.gov will help all government
agencies to accept forms electronically by October 2003.
We have an information technology investment portfolio
system which is a government-owned, off-the-shelf tool.
Treasury hosts this system for use throughout the entire
government. It is a Web-based e-government solution that
supports selection control and evaluation of all information
technology projects. Treasury requires all of its bureaus to
use this, and we were the first agency this year to submit all
of our consolidated budget information electronically to OMB.
We are also the governmentwide project manager for this
tool. Over 20 agencies are now reporting the use of I-TIPS. It
will support GPEA by replacing all the annual paper-based IT
Planning Call submissions to OMB.
We also hosted the Federal Bridge Certification Authority
Project for the Federal Government, which we now have operating
at GSA. The bridge allows agency public key infrastructures to
interoperate as it permits digital credentials, issued by each
agency to its employees, to be accepted with trust and
confidence by other agencies. I suggest you think of the power
of that as we begin to proliferate that across government.
Agencies will be able to perform Internet-enabled
transactions, such as credit card collections through banks, or
secure e-mail between agencies with previously unattainable
trust and confidence.
PKIs of five different organizations within the United
States, the Canadian Government and academia were cross-
certified through the prototype. The agencies were able to
interoperate successfully, exchanging digitally signed
electronic mail messages. It will be used by NASA, the USDA's
National Financial Center, FDIC, Treasury, the State of
Illinois, and Canadian Government for moving documents
electronically.
Our Bureau of Public Debt, partnered with the Financial
Management Service, Mellon Bank, MasterCard and IBM to build an
Internet-based system to sell savings bonds directly to the
public. Savings Bond Direct allows citizens to buy a savings
bond on a 24 x 7 basis using a credit card. The Bureau of
Public Debt sells directly to the public instead of traditional
networks. The system cost $350,000 to develop and implement,
and within its first 18 months of operation, it generated over
$230 million in bond sales.
The Bureau of Public Debt's Treasury Direct Electronic
Services allows individuals to directly manage their
investments in U.S. Treasury marketable securities, using
either the Internet or telephone. It promotes self-sufficiency
among 700,000 customers and facilitates debt collection and
consolidates from 37 Federal Reserve Banks to 3. By using this
system, public debt reduced the processing cost of a tender to
50 cents, as opposed to $30, to process a paper transaction
form.
U.S. Mint also has the on-line store recognized as one of
the top 20 e-tailers of the Nation. I'll defer to my good
friend and colleague, Mr. Mitchell, to talk a little bit more
about the Mint.
We also operate the Electronic Federal Tax Payment System,
which is the largest payment collection system in the world.
The primary objectives of that are to reduce the filing burden
by providing flexible payment choices to taxpayers, increasing
speed, efficiency and accuracy of all revenue collections.
IRS, of course, has its e-file program, which continues to
break records. Our U.S. Customs Service continues to use
electronic means to get goods and products into the country,
and the international trade data system, which Director
Mitchell spoke about, as a way to facilitate that.
Our Alcohol, Tobacco and Firearms now has an electronic
program which will permit 630 members of their industry to file
all forms electronically securely over the Internet. They will
use the same technology to solicit, award, administer and pay
commercial vendors conducting business with ATF.
Our electronic funds payment program continues to grow on
an annual basis, and our strategic plan supports all the goals
of GPEA.
In summary, I would like to reiterate that the Department
drive to be at the forefront of electronic government extends
well beyond just GPEA requirements compliance. We are seeking
to fundamentally redefine the ways we perform all of our
fundamental mission objectives.
I would like to thank the subcommittee for the support it
has given to e-government. Without your support, we would not
be able to achieve the national success we enjoy to date. I
would like to thank the members of the committee for the
opportunity to be here this afternoon.
This concludes my formal remarks. I look forward to
questions.
Mr. Burton. Thank you, Mr. Flyzik.
[The prepared statement of Mr. Flyzik follows:]
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Mr. Burton. It sounds like you're doing a good job over
there.
Mr. Mitchell.
Incidentally, to the Members, we have 10 minutes on the
clock on a vote. I will conduct the hearing here until we have
about 5 minutes. And if you want to leave, you can leave, or
you can come back later.
Mr. Mitchell.
Mr. Mitchell. Thank you for this opportunity, Mr. Chairman,
and members of the committee. With your permission, I would
like to submit my formal testimony and the Web site customer
analysis that we provided to the committee for the record----
Mr. Burton. Without objection.
Mr. Mitchell [continuing]. And briefly run through a
PowerPoint presentation which you see on the screens before
you.
On the second page, you can see that back in 1993 the Mint
had many challenges, including a disclaimer on its financial
statements, very few measures, and no strategic plan.
On the third page, you can see what we affectionately refer
to as our ``spaghetti chart.'' This was a legacy of no--never
having automated--excuse me, implemented an automated system
across the Mint and having a hodgepodge of nonintegrated
systems with a lot of manual processes. In short, it was not
helping us drive the strategic objectives and visions of the
Mint.
On page 4, you can see that instead of--a decision was made
in 1996 and 1997 that instead of spending approximately $20
million to do a Y2K solution and not gain any additional
functionality, and stay with systems that were not delivering
for the Mint, we decided instead to start from scratch, do a
requirements analysis, and go out and select systems off the
shelf with no customization that would meet our requirements.
And we chose PeopleSoft as our core solution, along with other
systems.
That system was implemented in 12 months in October 1998.
And as you can see on slide 5, in December 2000, we completely
upgraded that system and added additional functionality to it,
our system called COINS 2.0.
On slide 6, you can see that we have two upgrades under
way, one of which we will be implementing this August that will
add substantial functionality to our e-retail site. This will
be our third upgrade of the site since we implemented it. And
later in fiscal year 2002, we will be adding personnel
functionality and outsourcing our payroll processing.
Page 7, you can see that as a result of these systems, we
have eliminated all of our Federal Manager Financial Integrity
Act and FFMIA material weaknesses. We have no material
weaknesses at the U.S. Mint. We close our books every month in
10 days or less. We have greatly improved our customer service,
and our ERP implementation provided the foundation for our e-
retail launch.
On page 8, you can see the statistics that are fun
statistics about the growth of our Web site in the year 2000.
As Jim Flyzik mentioned, we actually had orders in the
neighborhood of about $156 million that put us in the top 20 to
30 e-tailers in the Nation.
Where are we now? On page 9, you can see that we have
generated record revenues and profits for the U.S. Government
and the American people. Last year, we generated $2.6 billion
in bottom-line profits, which was roughly four times our
previous record set just a few years ago. I stress, that's
bottom-line profit that goes to the Treasury general fund,
reduces the amount of debt issue, and saves hundreds of
millions of dollars.
The employees of the U.S. Mint are proud that in addition
to our customer-centric focus, we're contributing in some small
way to the American public. Seven consecutive clean audit
opinions and other attributes you see there.
On page 10, you can see a brief summary of the most recent
macro and micro-level surveys that we conduct. We have
conducted both of these for the last 5 and 6 years.
On page 11, you can see a summary of the University of
Michigan's prestigious customer satisfaction index. Heinz
absolutely blew the rest of us away with a 90 score on the
scale of 100. You can see that the U.S. Mint received a score
of 84, which equates us with amazon.com, BMW, and others.
``World class'' is determined by a University of Michigan to be
score of 80, and the private sector median is a score of 71.
You can see our scores on page 12 that we have participated
and received since 1995.
On page 13, I want to give you an example of how we have
improved, yet how much further we have to go. You can see our
results for the year 2000 were anywhere from OK to poor. You
can see that so far this year, we have increased tremendously,
including answering our calls within 17.5 seconds.
By the way, a lot of what we do, we benchmark against the
public and private sector and aspire to be the best in all of
our functional areas. However, you can also see some poor
results toward the bottom of the page.
In the Web survey that was conducted on our behalf, we had
over 25,000 respondents that let us know what was well and what
was not well in terms of what they needed from us on our Web
site. You can see the good news is, nearly 80 percent rated us
as excellent or very good. You can see those numbers on the
next page that follow out from the January through the May
surveys.
At the same time, you can see from page 16 that there are a
number of things they both told us in terms of feedback as well
as what they would like to change that included the fact that
even though we've won many awards for our Web site, there are
still components of it that are not best practices.
With our August launch, we will now be able to have
customer service self-servicing on our Web. They will be able
to communicate via e-mail with us through our e-retail site and
other components.
In closing, several slides I would like to give to you.
Page 17, you're no doubt familiar with. Your leadership role,
as well as the Council For Excellence in Government, noting
that 73 percent of all adults consider e-government to be a
high priority. And also the Mint's commitment not only to
compliance, but a proactive approach to GPRA and GPEA.
Let me just say that in terms of our customer-centric
focus, recruitment and retention is a challenge for us,
especially as high, as private-sector-oriented as we are. But
our ultimate success will be measured by the fact that
everyone--our employees, the American public, customers, our
business partners--we want them to get everything they need
from the U.S. Mint products and services electronically.
Mr. Burton. Thank you very much, Mr. Mitchell.
[The prepared statement of Mr. Mitchell follows:]
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Mr. Burton. We have to go vote. We will be back in about
10, 12 minutes. And then we will get to the DOD folks.
Thank you very much. We stand in recess.
[Recess.]
Mr. Burton. The committee will once again come to order. We
will now hear from Mr. Osterholz.
Mr. Osterholz. Thank you, Mr. Chairman. First of all, I
join everybody in wishing you a happy birthday. My son had a
birthday a few days ago. I'll report to him that he is in very
good company.
I would like to give some brief opening comments to
supplement the written statement, which you indicated is placed
in the record, and give you a better, a more broad picture, a
more comprehensive picture of what we're doing with respect to
GPEA.
To provide a functional view--and this is very critical,
because as the folks from industry pointed out, getting a
functional buy into anything that utilizes information
technology is so vital today--I have Norma St. Claire, who is
the information technology senior executive in our Personnel
and Readiness community. So she is here to provide you with a
functional perspective as we walk through this.
The GPEA report, in response to the data call, represented
only a portion of what we are doing with GPEA and related
activities. And I acknowledge, while I didn't have cognizance
of this area at the time of the report, I have got to
acknowledge the shortcomings of that report. I went over it
yesterday, and in fact it is not the best product we could have
submitted.
At the enterprise level, which really is the level that we
are operating at, what we are responsible for as the Chief
Information Officer of the Department of Defense is those
cross-functional issues that come as a result of the process
reengineering and the integration of the process reengineering
that occurs within the business functions of the Department.
As a result of that, a lot of our emphasis is in the areas
of architecture, enterprise, capital planning, and in the area
of assurance, because the way we achieve security and assurance
for our transactions needs to be uniform in order not to open
up vulnerabilities as a consequence of different procedures
leaving seams that, in fact, could erode confidence with our
partners on our systems.
The execution of GPEA is a decentralized affair, and it's
tied to those directly responsible for the processes in the
Department, the business processes in the Department. And that
is consistent with the testimony that you heard in the prior
panel.
Our functional process owners are responsible for process
transformation. However, doing that, we must ensure the ability
to electronically protect both citizen and employee privacy,
the intellectual property rights of our partners--very
important--and sensitive DOD information, particularly that
information that might be revealing of plans to be executed.
The Department is on a path to achieve strong electronic
authentication of sensitive documents. The Department has an
aggressive, probably the most aggressive, public key
infrastructure and public key enablement initiative in the
Federal Government today and is partnering with many of our
agencies.
The Department, as such, is involved in a number of
implementations to validate our steps and journey toward GPEA
compliance. These pilots and initiatives are absolutely
necessary to prove that we can properly apply--not only on a
small scale, but on a large scale, the Department has these
solutions.
Before I bring you down close to the weeds, I just wanted
to point out a few things that gets to some of the opening
statements, opening points, you made earlier.
Secretary Rumsfeld has just announced the formation of a
Senior Executive Council which will consist of himself, the
Deputy Secretary, the Under Secretary for Acquisition
Technology and Logistics, and the service Secretaries. The
purpose expressed to that is to bring together those senior
individuals, each one of which is a captain of industry in his
own right, in dealing with new ways of doing business within
the Department of Defense.
So, yes, we're poised for the kind of leadership--looking
at the way, bringing the private-sector approach within the
Department in a way that I don't remember in recent memory. So
we're looking forward to the leadership that will come from
that panel or that council to kind of bridge together the
islands of excellence that we have got in the Department.
Another point that I would like to make before I bring you
again close to the weeds is, we now have, as a result of a lot
of hard work, the first enterprise IT architecture in
Department of Defense history. So we now have the ability to
look across the enterprise known as the Department of Defense
and address the value of information, how hard we need to
protect it, what are the interoperability difficulties
associated with moving that information around both within the
Department and externally, and be able to address the value of
the capital investments necessary to move us further forward
toward GPEA compliance.
That is a major achievement, to have that enterprise
architecture. We didn't have that before. I point out that was
required by Clinger-Cohen.
Another point is, we looked at interoperability very hard.
Some of the other members mentioned interoperability more than
once. When we looked at interoperability within the Department
ourselves--and title 10 was modified in 1999 to make the Chief
Information Officer of the Department of Defense responsible
for ensuring interoperability across the Department--we looked
at the process that basically provided that interoperability.
We found that policy was 10 years old. That policy goes
back to when we may have argued about whether e-mail was a
relevant way of doing government. We have gone past that point.
So we basically have taken the entire interoperability
process down to bare metal and have rebuilt it back up, so it
effectively works in the network age and the GPEA. And the
progress in GPEA will, of course, benefit from that new process
that we're putting in place under this administration.
Along the same lines, the acquisition of our capabilities
to include information technology now incorporates
interoperability as a key performance parameter. That is a
technical term in acquisition talk. But what it means is
failing to meet a key performance parameter is cause to stop a
program. So interoperability has now achieved that importance
within the Department of Defense.
So those are some of the kind of top-level things that get
at the very important and correct questions that you brought
up.
Let me, if I may, take you a little closer to the weeds. We
are cosponsoring with a number of others the Federal Bridge
Certificate Authority that Jim Flyzik discussed earlier. That
started out as a Navy project through the Department that was
housed in GSA and--excuse me, Treasury--and has moved to GSA
for instantiation.
That is a very important activity and initiative to us
because that allows for addressing differences among agencies
from the point of view of security and transactions. So that
bridge will be kind of a gateway in the sense of allowing us to
arbitrate and deal with security differences between partners
and between members of the Federal Government in a way that we
still can preserve the benefits of electronic business.
We are issuing SmartCards, those common-access cards that
you might hear about. Here is an example. We are, in fact,
issuing them; we have issued 25,000 to date, and we are going
to be issuing, at the end of the game, 3.5 million of these.
This revolutionizes our ability to gain access to
information technology services in a paperless way. It
increases our ability to audit, as I think was brought up by
some of the members earlier, the uses of our IT to make sure
that the IT utilizations are lawful and legal, that they do not
usurp resources that are needed elsewhere.
So this is a very important reengineering step where
technology is applied for the purposes of better electronic
business.
We are pursuing initiatives to use PKI in the export
licensing process involving the Departments of Defense,
Commerce, State and Energy, a very critical reach-out from our
point of view. That will include 10,000 businesses.
We are making great strides toward achieving a paperless
end-to-end contracting process. Today, we are able to achieve
83 percent paperless. That is the capability we can get to. The
7 percent that is beyond our reach at the present time requires
us to implement the public key infrastructure [PKI], that I
talked about and also to recognize that some of the smaller
business partners will have difficulty working electronically
because of the investment necessary on their end. That is an
important point that we are mindful of. But that 7 percent, our
last mile, if you will, we are working hard to overcome.
Finally, we are moving toward electronic submission and
processing of claims for payments we called e-invoicing. The
target date for that is October 2002, which is 1 year before, 1
year ahead of the GPEA target. So we have a number of short-run
milestones on our plate.
Other than to introduce Ms. St. Claire, this concludes my
comments, sir. Ms. St. Claire is here to give you a quick
summary of Personnel and Readiness initiatives, again focusing
on the importance of the functional buy-in for any of our
information technology investments.
[The prepared statement of Mr. Osterholz follows:]
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Mr. Burton. Ms. St. Claire.
Ms. St. Claire. Good afternoon. I am pleased to be here to
tell you about the way we are implementing GPEA in the DOD
personnel community. The Office of the Under Secretary of
Defense for Personnel and Readiness works with all of the
services within the Department of Defense, as well as with all
of the external agencies that need to have access to DOD
personnel records.
As a matter of fact, a couple of years ago, we did this
report--we did this study on what the external customer base
was for the military personnel records, so that we could
prioritize those areas where we had the most problems. And as
you mentioned in your opening statement, we recognize that we
do have some issues with Veterans Affairs in being able to
provide them the paper that they need as quickly as possible.
Our goal is the elimination of redundant data capture forms
and other paperwork. And that is a critical component of our
entire business process reengineering program.
We have a Personnel and Readiness strategic plan and a
Military Personnel Management Information strategic plan. They
are on our Web site. I can give you the address for our Web
site. Our entire business process reengineering program is
described there. It is www.mpm.osd.mil. We would be happy to
have you look at everything there.
We have already implemented a number of initiatives that we
feel satisfy the GPEA requirement, and they are discussed in
more detail in my written statement.
We are trying to ensure that the way we do this is smart.
We do not want to automate processes and forms that would be
better eliminated. And that's what the goal of our business
process reengineering program is. We are finding that we can
eliminate a lot of the forms and paperwork, and then we
wouldn't have to worry about automating them. So we are trying
to take this in a very smart way.
The work that we do in military personnel impacts our
entire community, and it impacts military personnel through
their entire life cycle. Our military people, we start with
when they first access--actually, when we first start
recruiting them.
They come into the military. They go back and forth between
Active and Reserve components, of course. They leave the
military. And we still have an obligation to them as they go
out and are entitled to benefits that they are entitled to
because of their military service. We also track all of their
dependents. So we have a very large community that we take care
of.
I would like to close by emphasizing that both in P&R and
in the Department, we fully support the goals of GPEA, and we
have actually used this law to help highlight some of our
issues and problems to help us move faster with our whole
program for business process reengineering and making maximum
use of new technology. Thank you.
Mr. Burton. Thank you.
Let me start the questioning to Mr. Willemssen.
We asked you to look at the GPEA plans for the Treasury
Department and the Defense Department, and I have some
questions about both of those.
Have you reviewed the plan of the Defense Department that
was submitted to OMB? Have you reviewed that yet?
Mr. Willemssen. Yes, sir. We did, Mr. Chairman.
Mr. Burton. What was your impression of it?
Mr. Willemssen. We were disappointed with the lack of a
strategy that would have detailed the Department's approach to
addressing GPEA. The plan, instead, was a listing of potential
activities that could be electronically done, rather than by
paper; but we did not see any kind of strategy.
Upon meeting with Department officials, we again did not
receive any kind of documented strategy.
Mr. Burton. So I presume you conclude that by the goal of
2003, they won't be able to comply?
Mr. Willemssen. Based on progress to date, it will be a
challenge for them. Setting up interim milestones would be a
step in the right direction. If the Department can lay out
tasks and milestones to try to get there, that is definitely
where they need to go.
Mr. Burton. Did your staff then meet with people from the
Defense Department to determine, you know, how they were going
to put the plan together?
Mr. Willemssen. Yes, we did.
Mr. Burton. I know you have heard some of the things today
that were positive.
Mr. Willemssen. We did contact the Department to try to
understand the process that they used. And, bottom line, what
we could determine is, the process was going out with the data
call to component level and then--component levels and then the
data call continuing to go to lower levels, and then the data
coming back up through the chain. And, unfortunately, we did
not see any evidence of review of what came back up; and that
is when we looked at the collection information.
It also appeared that some of the entries were duplicative
and inaccurate. Upon talking with the Department on that, they
agreed to followup. And I think they can speak for themselves,
but I think they did find those types of discrepancies.
Mr. Burton. We will get to that in just a second. As I
understand it, if you saw that they were, in essence, just
cutting and pasting things that had already been determined.
Mr. Willemssen. Yes. Rather than thinking strategically
about what should be done electronically versus paper, it
appeared to us, based on the audit work we did, that it was an
approach of, let's go out with a data call and ask people what
they currently do and what they can do electronically instead
of on paper. So the data call went out, data came back, and it
was aggregated without, from our viewpoint, critical review.
Mr. Burton. Did you, when you were going through the
process, ever identify anyone who was responsible for
implementing GPEA? I mean, was it just nobody was responsible?
Mr. Willemssen. Well, at the Department level, I believe
the current CIO is in an acting position. And then we had a
couple of meetings with a Mr. Grant, who was in the Office of
CIO, and then several of his staff. I believe Mr. Grant's title
is e-business, e-government.
But in terms of, I think, being consistent with Clinger-
Cohen, the accountability has to stop with the CIO and the
Secretary.
Mr. Burton. So, in essence, you didn't really find anyone
that was?
Mr. Willemssen. We didn't find, from a departmental
perspective, somebody willing to sit and take the reins and
say, this is what we need to do from a strategic perspective,
this is what makes the most sense, as opposed to continuing
with business as usual.
Mr. Burton. We heard what Mr. Osterholz and Ms. St. Claire
just said. But do you think they are making a serious effort
over there to comply?
Mr. Willemssen. I think oversight activities, such as the
hearing today, can make a tremendous difference in the extent
to which this is viewed as a priority at the Department. So I
sense that, even within the last 1 to 2 weeks, there has been
much more of an effort and more of a priority placed on this
particular area.
Mr. Burton. Have you done--well, of course, you are pretty
much working just on the Defense Department, aren't you, over
there on your reviews?
Mr. Willemssen. I have responsibility for IT across the
government.
Mr. Burton. You do?
Mr. Willemssen. Yes.
Mr. Burton. Have you found other agencies of the government
that are in the same predicament as the Defense Department?
Mr. Willemssen. Yes. The Defense Department is certainly
not alone in the challenges it faces in----
Mr. Burton. Could we get a list of those agencies? Because
what we will want to do is--I think we ought to send a letter
to them telling them of this hearing and telling them that the
Defense Department, we think, is now moving in the right
direction; but that if they don't, they will be subject to
being called before the committee, along with you, to explain
why they are not moving in the right direction to make sure
they comply by 2003.
So--would you make a note of that?
So we would like to have that list so we can contact them.
So if you can get that to me, I would really appreciate it.
Mr. Willemssen. Yes, sir.
Mr. Burton. Mr. Osterholz, we want to be fair to you. We
didn't bring you up here to beat on you with a ball bat or
anything, although I've got one.
I understand from what you said that there are a number of
good automation programs under way, and hopefully, they'll
produce results. At the same time, as you can see, you haven't
come off looking as well as you would like.
But you feel like you're now moving in the right direction?
Mr. Osterholz. We are moving in the right direction.
I have to echo what Mr. Willemssen said, that the
Department is a very large enterprise. And we have tremendous
responsibilities with respect to information technology to
support our core missions of warfighting. And prioritization is
a daily occurrence with us. And I think clear prioritization is
important, keeping us on the right path.
Mr. Burton. Let me--with Mr. Kanjorski's approval, I would
like to ask just a couple more questions. Then I'll yield to
you.
Who is the most senior person at the Defense Department who
is responsible on a day-to-day basis for implementing the GPEA
and electronic filing programs?
Mr. Osterholz. The Acting Chief Information Officer is Dr.
Linton Wells.
Mr. Burton. You say ``acting.''
Mr. Osterholz. He is the Acting Chief Information Officer.
He is the Acting Assistant Secretary of Defense for Command,
Control, Communications and Intelligence. The President hasn't
filed an attempt to nominate a successor. That gentleman is not
on board, obviously, and has not been confirmed yet.
Mr. Burton. We ought to check and find out when they plan
to submit that name for confirmation.
So did the person who is currently in charge, did he review
the plan before it was submitted?
Mr. Osterholz. No, sir, I believe he did not.
Mr. Burton. Why was that?
Mr. Osterholz. I cannot answer that, sir. I do not know.
As I said, I took cognizance of this issue. I can
speculate. I took cognizance of this issue after that had gone
on. As I said, last night and the last week, I went through
this process to verify that in fact what was discussed was
substantively correct. I cannot tell you why he did not, at
what level it was reviewed. I can only tell you that he did not
review it.
It was probably reviewed at a Director's level at the
Department. A lot of things get done by e-mail. Unfortunately,
things get sent out under the press of a time line that don't
get the review that they require. Not an excuse, but an
explanation, sir.
Mr. Burton. But that won't be the case in the future,
though?
Mr. Osterholz. Certainly not, sir.
Mr. Burton. OK. Good. What is that person doing on a day-
to-day basis to move the process along?
Mr. Osterholz. Mr. Wells is the chair--is the chair of the
Chief Information Officer Executive Board, which makes the
information technology decisions for the Department. That board
involves all of the IT service providers in the Department, as
well as the functional process owners in the Department, so
that we have the joint of technology and process that again was
discussed in the earlier panel. And so information technology
is his primary responsibility.
In addition to that, the guidance that was put out, which
was put out under Art Money, who is the predecessor to Mr.
Wells, is very clear about--if I may just simply read the key
pieces of it--new or redesigned GPEA-compliant electronic
transaction applications will be based upon the following:
redesigned business processes, again making sure we're not
paving the cow path; relative cost benefits and risk analysis,
providing the basis for attempting to maximize benefits by
minimizing risks; inclusion of DOD privacy and information
security policies and practices; again, the balance between
access, what you project, what you protect; the termination and
documentation of the chosen electronic signature alternative.
And electronic signatures are interesting in that the
technology is certainly there. Its acceptability in some cases
is questionable. We've had rulings that said electronic
signatures, good idea, but send the paper anyway. And that is
an important piece to look at.
And review of policies to adequately support electronic
transactions.
So that's the guidance that was given out in January of
this year to our components with respect to their GPEA
activities. So there is an active role, but it is one role
among a number of things that the Chief Information Officer
does.
Mr. Burton. Mr. Kanjorski.
Mr. Kanjorski. Thank you very much, Mr. Chairman.
I guess this is the wrap-up panel. And I don't know whether
accolades are in order or whether we should be questioning why
all the departments and agencies aren't in the same thing.
But let me just run through some of the testimony that I
heard and get corrections.
In the Treasury area, I understand that you think you are
moving along very well and making great strides. But besides
efficiencies and movement of paper, there is the thing of
picking up fraud and abuse, and particularly in tax returns.
What I can't understand is, if we do have a sophisticated
computer system operating in Treasury, how is it that prisoners
can still file for tax returns by the hundreds and receive
them, direct mail to their prisons, and we don't have a system
that picks that type of fraud up.
Mr. Flyzik. Yes, sir. The IRS has a very aggressive program
to modernize. The issues you are raising are well known, they
are well documented, they are well publicized. It is also well
known and well publicized, the history of attempts to modernize
in the IRS.
I perhaps was able to say in the past that was not my
watch. I can no longer say that. I am directly involved in the
modernization of the IRS today. I feel real good about the
progress we are making.
We have a lot of legacy applications in the IRS that date
back a long time. And I feel happy with the fact that
Commissioner Rossotti is there. He has got an IT background. I
feel we have got a governance structure in place, we have got
due diligence in place, and we will fix those problems.
I think that most of those problems are due purely to the
sheer complexity of the legacy systems that exist today in the
IRS and the inability to do a lot of interoperability kinds of
programs.
I like to think the Internet knows no time boundaries like
these old legacy applications do; and obviously, what we need
to do is get these applications on line to do real-time editing
and error correction before the errors can get into the system.
And that is our goal. It won't happen overnight, but it
will happen.
Mr. Kanjorski. In my district, there is a county prison,
and one of the prisoners operates a network across the country
on the Internet with other prisons. And they are just notorious
and extremely successful in making applications for income tax
refund checks. And they get them by the dozens, I mean
literally.
And I have had complaints from the warden of that prison
just saying, you know, he just doesn't understand how this can
continue to go on. You would think one or two times that they
would catch it, but this is year after year.
Now they are spreading out through the prison system across
the country, and I don't know whether it's on a commission
basis that they're doing it, but they are being very successful
and still requesting these checks and getting them.
Naturally--probably there is strong publicity when that
occurs. But you have to understand how offensive it is to a
legitimate taxpayer when they find out that all you have to do
is get sentenced, go to prison, start filing your returns and
make several hundred thousand a year. It tends to rub us the
wrong way.
But I think you're on the right track. It was a good
report.
I particularly want to compliment that part of the Treasury
that is known as the U.S. Mint. And they are obviously up here
because I guess they are the four-star or five-star agency
here. They not only are very good in showing how they can
correct the system and make the hard decisions to go to a
modernized system under the 2000 problem; they showed us all
that thinking ahead and using your money wisely can really
accomplish some great things.
So, Mr. Mitchell, you should take back my compliments. But
mostly because you have the good foresight to have press
representatives and public relations people like Eva on your
staff. I happen to know how competent she is. So that's very
good.
In regard to Defense, it is a huge agency. And of course if
you are not on board, everything everybody else does is minor
by comparison. I think that both the Department of Defense and
the Department of Energy have real needs to get into the modern
age and to work through their systems.
I am particularly interested in disposal of property and
knowing what assets are out there that are excess or surplus
and how we can get utilization of them and get a handle around
them in a big way.
The only other thing that I would say that did bother me,
and I don't know whether it was the Defense Department or the
Department of Energy, they seem to have slipped in their
awareness of technology and what can be erased from computers.
And I know for a fact where they excessed to the waste pile
hundreds and hundreds of computers that had all the formulas
for nuclear weaponry on them; and we just can't afford to have
those types of failures in the system where people aren't aware
of what potentially they are throwing away.
I happened to find out about it because I was dealing with
people who were trying to do construction--or destruction and
demanufacturing of computers and found a lot of that material
readily accessible on the computers that were discarded. And I
would hope that we would tighten up. It's not only to
accomplish a paperless society or reduction in paper, but it
certainly is important that we protect information,
particularly highly classified information such as that.
So that, as we go down this road, it seems to me that all
the component parts, including disposal of materials, is very
important. And I would hope that the departments of government
would cooperate.
Let me ask you this question, would it be helpful to the
various departments to have a centralized clearinghouse
operation that would establish the standards of how to handle
things, the programs that are available and the information, as
a central repository; or do you think it's absolutely essential
that each department have its own system and sometimes without
standardization and without the capacity to be accessed by
other departments of government or outside interests?
Maybe I'll direct that as an open question.
Mr. Flyzik. I would like to believe that the Federal CIO
Council is stepping up to becoming the central repository for a
lot of issues. We now have in place a Federal Government
architecture model. We are looking at the standardization
process. We have an architecture at Treasury, as does DOD, as
mentioned. Our Treasury architecture complies with the Federal
architecture standard that is being defined.
So I think we are getting there.
I would like to think the CIO Council has gone through an
interesting evolution. Like any other group first put together,
we went through kind of a bonding process to figure out who we
are and how we work. And I think, though, over the last year or
so, it has really evolved into taking on specific, tangible
programs and projects that will deliver the kind of results
that you're addressing here.
Mr. Kanjorski. Do you ever see a day where those of us that
sit up on the Hill, that want to find out what is available to
a constituent, can dial in that information and type it in, and
it is going to source it out and find it?
Right now, most of the departments of the executive branch
of government, and the bureaus, unless you know what program
they are administering and how it works, you can't find it. I
mean, it is the most closely held secret.
Very simple questions, you know, is there a disaster relief
for mortgage holders in a disaster area, and does the Federal
Government have a program like that? Unless you know exactly
the name of that program or where it is, it is hard to access.
Mr. Flyzik. Yes, sir. And I believe I refer you to--we did
roll out the portal First.Gov, www.first.gov, and it is
designed to do exactly what you are suggesting here. That
individual constituent, without any knowledge whatsoever of the
functions of government, can get answers to specific questions.
I think First.Gov is merely scratching the surface of where we
are going to go, because for the first time we will begin to
understand the way customers see government.
And I agree with you. They don't see government on an
agency-by-agency basis. They see government on a functional
basis.
I think First.Gov is our first start at fundamentally
restructuring. I think we will go through phases here where
First.Gov will lead to kind of virtual agencies, agencies that
are working together in common functional areas. And I think,
in the long run, looking out beyond it could actually lead to
fundamental restructuring of government.
Mr. Kanjorski. Very good. Maybe I'll put this to the
Defense Department.
Your part of the agencies or departments that are involved,
not all of them obviously, but you have an awful lot of
technology that is still black-bagged, that is already being
duplicated in the commercial area that could be of great
assistance to other governments and the commercial interests of
the country.
How do we go about freeing that stuff up?
Mr. Osterholz. I would tell you that--to be honest, tell
you, that is a very complicated question, because some of those
other parties who would want that technology would not
necessarily be interested in using it for the betterment of our
interests.
So that is a very, very complex question. And it's hard to
give you a general answer except perhaps to point out some of
the issues that we have to wrestle with today.
Understanding what a corporation is and what its interests
are and what its pedigree is is an interesting question for us.
What a U.S. company is today is sometimes a very complicated
question to get an answer on. So understanding the motives for
technology transfer is a vital piece of answering that
question.
To move technologies, you referred to ``black-bagged,'' you
are referring to classifying technologies perhaps, such as you
might find in geospatial information systems, things that you
were very familiar with.
Very frankly, we look at commercial geospatial information
systems as a very positive factor in that their existence for
us gives us access to information that we may not be able to
get to because of limited resources on our end. Our own assets
obviously are very heavily tasked, and the availability of
additional geospatial sources of information is very positive
thing for us.
Now, we worry a lot about who else has access to that, No.
1, because we would hate to see that sort of capability used
against our forces with the sorts of resolutions that I am sure
you are aware of that are coming around the commercial world.
No. 2, we have to be careful as we deal with them from an
electronic commerce point of view. We would buy that
information from them. We want to make sure that wasn't
necessarily revealing of our interest. It would be very
unfortunate if our buying of, say, commercial imagery products
revealed an operation pending and put our forces in jeopardy.
So we have to worry about that. And that's where the PKI issues
come really to the fore.
But I think you are going to see, and increasingly--in
fact, there aren't a lot of black-bag technologies, as you put
it--that the commercial world is, in fact, the place where the
technologies are and that its first adoption is not necessarily
behind the green door, as it used to be. Its first adoption is
in Silicon Valley. Its first adoption may be in the government
agency, sir.
Mr. Kanjorski. As to the programs, I agree with you. They
are probably ahead of the government in what they can do.
But the delivery systems, the satellite systems, etc., that
could be utilized to help out, particularly in environmental
protection, fire protection--I'll throw that out there and
leave it; you probably know what I'm talking about--you know,
we can save inordinate amounts of money and benefit to the
general citizenry, the individual States and individual
communities if we can find a way to open up and use the excess
capacity that we have in the Defense Department for the private
sector, for the government, for State and municipal governments
in particular.
So I just throw that out there and leave it.
Mr. Chairman, I just want to congratulate you for calling
this hearing. It seems to me it's one of the more progressive
ideas in the role of this committee; and I hope we stay on this
course, because for us, as members, who are so ill-informed in
this new technology, to have the opportunity to get the
testimony and hear the statements of this type of expertise is
very rewarding. So thank you very much.
Mr. Burton. Thank you, Mr. Kanjorski. We will try to do
just that.
I want to thank all of you for being here. We appreciate
the input. We appreciate the progress that you have made both
at the Mint and Mr. Flyzik.
And the Defense Department, we hope and wish you well in
the future. We will be watching and trying to work with you.
With that, we stand adjourned. Thank you.
[Whereupon, at 1:15 p.m., the committee was adjourned.]
[The prepared statement of Hon. Edolphus Towns follows:]
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