Testimony of Jacob J. Lew
TESTIMONY OF
JACOB J. LEW
DIRECTOR
OFFICE OF MANAGEMENT AND BUDGET
BEFORE
U.S. HOUSE OF REPRESENTATIVES
COMMITTEE ON APPROPRIATIONS
SUBCOMMITTEE ON TREASURY, POSTAL SERVICE,
AND GENERAL GOVERNMENT
MARCH 28,
2000
Mr. Chairman, Representative Hoyer,
Members of the Subcommittee, I am pleased to be here this
morning to discuss the President's Fiscal Year (FY) 2001 budget request for
the Office of
Management and Budget (OMB).
I would like to make a short statement
and then I would be pleased to answer any questions that
you have.
Overview
As stated in the OMB Performance Plan,
OMB assists the President by reviewing agency
proposals on a variety of topics from budgets to regulations; assuring that
such proposals are
consistent with relevant statutes and Presidential objectives; providing
analysis and advice on a
variety of subjects; and, developing government-wide policies for the
effective and efficient
operations of the Executive Branch. Although housed within the Executive
Office of the
President (EXOP), the majority of OMB's 518 staff are career employees who
provide
"institutional memory" and the most objective analysis possible for the
President.
I believe OMB has served this
Administration and the American people extremely well. OMB
has played an essential role in maintaining the fiscal discipline that has
produced budget surpluses
for three straight years and making the government work better for the
American people. While
executing these roles and responsibilities -- many of which have been
increased in recent years --
OMB has tried to remain fiscally disciplined in developing its own budget,
attempting to
maximize the efficient use of its base resources as opposed to requesting
increased funding levels.
Mr. Chairman, at last year's OMB budget
hearing you asked me whether new workload
requirements were "stretching the limits" of OMB staff. I answered at the
time that we were
undertaking a number of internal improvements focused on communications,
workload
management, and the use of information technology to make OMB more
productive within
essentially constant budget levels. I believe that we have made good
progress in each of these
areas, but additional resources will be necessary in FY 2001.
For FY 2001, OMB is requesting $68.8
million in budget authority. This is an increase of $5.5
million over the FY 2000 enacted level of $63.3 million. Roughly 70
percent of this requested
increase, $3.8 million, is to maintain current operating levels. The
remaining $1.7 million is
requested to address increased workload demands by investing in staff,
training, and new
information technologies. The requested funding level will provide 527
full-time equivalent
(FTE) positions, an increase of nine FTEs over the FY 2000 level of 518.
This request is fully
consistent with the OMB Performance plan, which we have submitted to you
previously.
As we approach the end of this
Administration, I feel a special obligation to leave OMB with the
resources it needs to serve the next President as it has this one. This
request would provide those
resources.
Meeting our Growing
Workload
OMB operates in a fast-paced
environment, dealing with a variety of complex issues on a daily
basis. It has the lead role within the Executive Branch for maintaining
Federal fiscal discipline,
allocating scarce resources, and promoting program efficiency. OMB
provides leadership and
assistance in financial management, procurement, information collection and
dissemination, and
other government-wide management functions. These responsibilities are
carried out working
cooperatively with the Congress and congressional agencies such as the
Congressional Budget
Office and the General Accounting Office. In addition, OMB provides
leadership and support for
interagency groups such as the President's Management Council, the National
Partnership
Council, the Chief Financial Officers Council, the Chief Information
Officers Council, the
President's Council on Integrity and Efficiency, and the Procurement
Executives Council.
Working with Congress, this
Administration set out to create a government that works better,
costs less, and gets results Americans care about. OMB has been central to
this effort. For
example, OMB monitors and provides advice, support, and leadership in
addressing the 24
Priority Management Objectives (PMOs) described in the President's budget.
We are pleased that
we were able to successfully address last year's number one management
objective -- Managing
the Year 2000 Computer Problem. While we have made real progress on the
other management
priorities, there is still much work to do. OMB will continue to provide
leadership and analytic
support to address many other priorities, including modernizing student aid
delivery, completing
the restructuring of the Internal Revenue Service, and strengthening the
Federal statistical system.
Despite staffing levels that have
decreased by almost 10 percent from 573 FTE to 518 FTE since
1993, OMB continues to carry out its traditional responsibilities and the
new responsibilities
Congress has placed on it. The Government Performance and Results Act,
Federal Financial
Management Improvement Act, Information Technology Management Reform
("Clinger-Cohen")
Act , Government Paperwork Elimination Act, Federal Acquisition
Streamlining Act, and Federal
Activities Inventory Reform Act all require a significant investment of
staff resources. More
recent requirements ranging from the "Stevens Report" on the costs and
benefits of regulations to
the report on climate change also impose new workloads. Congress also has
imposed a number of
new grant management responsibilities on OMB, including revising Circular
A-110 to open
access to research data, preparing an inventory of all Federal grants, and
fulfilling the provisions
of the Grants Management Simplification Act. Laws that have increased OMB
workload since
1993 include:
- Government Performance and Results Act
(PL 103-62)
- Federal Acquisition Streamlining Act (PL
103-355)
- Government Management and Reform Act (PL
103-356)
- Evaluation of DC report (PL
103-373)
- Unfunded Mandates Reform Act (PL
104-4)
- Paperwork Reduction Act (PL
104-13)
- Federal Acquisition Reform Act (PL
104-106, Division D)
- Information Technology Management Reform
Act (Div. E, PL 104-106)
- Regulatory Flexibility Act Amendments
(Title II D, PL 104-121)
- Congressional Review of Agency Rulemaking
(Title II E, PL 104-121)
- National Technology Transfer and
Advancement Act (PL 104-113)
- Single Audit Amendment Act (PL
104-156)
- Federal Financial Management Improvement
Act (Title VIII, PL 104-208
- Fiscal Year FY 1998 Defense Authorization
Act (PL 105-85)
- Government Paperwork Elimination Act
(Title XVII, PL 105-277)
- Federal Activities Inventory Reform Act
(PL 105-270)
- Submission of an Accounting Statement and
Report to Congress on the Costs and Benefits of
Federal Rules and Paperwork Treasury/General Government (PL
106-58)
- Counterterrorism & Antiterrorism (PL
105-85, Sec. 1051)
- A report on total Federal expenditure of
all official international travel during the previous
fiscal year (Omnibus Consolidated & Emergency Supplemental
Appropriations Act)
- A report providing a final accounting of
the finances and operations of international agencies
abolished under Division G of the Act (Omnibus Consolidated & Emergency
Supplemental
Appropriations Act)
- Grants Management Simplification Act (PL
106-107)
- Submission to Congress of an inventory
of Federal grant programs (Treasury/General
Government Appropriations, PL 106-58)
- An accounting of climate change programs
in the FY 2001 Budget (Consolidated
Appropriation Act, PL 106-113)
- Designation of OMB to Chair the National
Commission on Use of Offsets in Defense Trade,
and submit a report to Congress (Section 1247(d) of FY 2000-01 Foreign
Relations
Authorization Act; PL 106-113)
While OMB workload has substantially
increased, the resources available to address the new
workload have decreased since 1993. OMB needs the additional requested
resources to continue
to be pro-active in budget and management issues and ensure that future
Administrations continue
to benefit from the high-level support from which this Administration has
benefitted.
Investing in our People
In FY 2001, OMB requests an increase of
$613,000 to fund nine new FTEs to oversee the
numerous management initiatives required under current law, analyze key
budgetary and
economic areas, and assist in preparing the Federal Budget and the many
reports required of
OMB. Much of the individual agency review and implementation is carried
out by OMB's
Resource Management Offices. However, consistent with the reorganization
of OMB
implemented in 1994, the Statutory Offices (the Offices of Federal
Financial Management,
Federal Procurement Policy, and Information and Regulatory Affairs) provide
technical expertise
and advice in this effort and we have proposed additional resources in
those offices for this
reason. The nine new FTEs would be allocated as follows:
Statutory Offices
(4)
- Two additional staff for the Office of Federal Financial Management
to support the review and
implementation of financial systems, as required by the Federal Financial
Management
Improvement Act.
- Two additional staff for the Office of
Information and Regulatory Affairs to support
information technology issues ranging from capital planning to computer
security.
Resource Management Offices
(3)
- One additional staff each for National Security and International
Affairs; Natural Resources,
Energy, and Science; and Health/Personnel in recognition that the pace and
range of
policymaking in these areas have expanded substantially in recent
years.
OMB-Wide Offices
(2)
- One financial economist to provide
expertise on issues ranging from financial institutions to
improvement in handling of Government-held debts as required by the Debt
Collection
Improvement Act.
- One staff position to assist in
preparation of the Federal Budget and the many reports required
of OMB.
In addition to the staffing increase
described above, OMB is requesting an increase of $85,000 to
support increased administrative, examiner/analyst, and management staff
training. This funding
will be used to expand current training and professional development
opportunities to ensure that
all staff have the tools necessary to do their jobs effectively.
Investing in Technology
I am proud to note that OMB itself met
all of the Y2K target dates that it set for agencies
government-wide and that OMB successfully transitioned into the New Year
with no problems.
As part of these preparations, OMB replaced 50 percent of its personal
computers (PC).
Information technology (IT) is an
important aspect of OMB's efforts to manage its increased
workload. We have taken steps to ensure that we use these tools
effectively and efficiently. As
noted in the FY 2000 OMB Congressional budget justification, an Integrated
Process Team (IPT)
was created to evaluate OMB's IT goals. The IPT was charged with defining
the next generation
of information technology in OMB to improve staff productivity, reduce
costs where appropriate,
reduce cycle time needed to complete key processes, and identify new
opportunities to enhance
OMB's external interactions. Consistent with the Clinger-Cohen Act, the
IPT significantly
influenced the development of OMB's FY 2001 IT budget request.
In FY 2001, OMB is requesting
$1,030,000 to begin remediation and improvements for
information systems. The FY 2001 IT request is an investment in a five-year
improvement
program that is fully consistent with and complementary to the EXOP IT
request. OMB's IT
request includes funding to:
- Correct deficiencies in network
infrastructure. To improve the speed and reliability of the
IT network, including the critical mail and file servers, and to replace
old equipment in wire
closets. These improvements build on the EOP Office of Administration's
(OA) network
infrastructure enhancements currently underway, but address OMB-unique
needs such as
OMB's web-enabled Legislative Information System and the Research and
Development
crosscut data collection system.
- Improve the speed of remote
access. To provide staff with faster, more secure, and more
reliable connections to their data and applications from points outside the
EOP complex.
Again, this would respond to OMB requirements not included in the OA
enhancements (e.g.,
MAX budget system).
- Modernize correspondence
system. To update, expand, and automate the antiquated
correspondence system to enable quicker and more efficient written
responses to
Congressional and other inquiries. The OMB modernization effort
will include the possibility
of integrating with the future EOP-wide information and document management
system once
OA's plan for the system is finalized.
- Classified systems. To
make OMB staff more efficient by allowing classified data from
agencies to be transmitted electronically.
- Report writing
software. To replace our 20 year old analytic software and buy a
modern
commercial software product that can handle OMB's large scale production
reporting
requirements as well as be integrated with OMB's desktop analytical tools.
OMB's efforts will
support, budget, economic, regulatory and management analysis that is
unique to OMB's
mission.
- A-11 data collection technology.
To improve agency communications and information
sharing by updating data collection technology to incorporate current
Web-based practices.
The A-11 system collects the budget data contained in the President's
budget..
- OMB IT support. To
provide staff with on-site support to resolve computer problems and to
provide technical assistance to staff with home computer problems,
improving work efficiency,
and other problems unique to the OMB environment.
Conclusion
OMB is a fine organization, committed
to producing work that is invaluable for both executive
and legislative branch policy decisions. OMB deeply appreciates the
confidence that Congress
has shown in it, as is indicated by the additional responsibilities that
have been given to it in
recent years. However, additional resources are required to carry out
these responsibilities with
the professionalism and quality that have come to be expected. I urge you
to approve our request
to increase our staffing level and provide for key technology improvements
to help us meet the
requirements of our mounting workload, enabling OMB to serve the next
Administration as ably
as it has served this one.
Mr. Chairman, that concludes my
statement. I would be happy to answer any questions.