Congressional Testimony

STATEMENT OF MITCHELL E. DANIELS, JR.
DIRECTOR
OFFICE OF MANAGEMENT AND BUDGET
BEFORE THE
COMMITTEE ON GOVERNMENT REFORM
U.S. HOUSE OF REPRESENTATIVES

June 21, 2001

Mr. Chairman and Members of the Committee.

Thank you for inviting me here today to share my views on how best to implement the Government Paperwork Elimination Act (GPEA). We welcome your interest and the opportunity to work with you on this very important issue.

GPEA and E-Government

GPEA is a strong statutory driver for electronic government, which is a government-wide priority for this Administration. The Federal Government can secure greater services at a lower cost through electronic government, and can meet high public demand for re-engineered e-services. Currently the Government lacks long-term planning and coordination of information and technology (IT) investments that could deliver greater efficiencies in and across programs. The government spends roughly $45 billion annually on IT, but a great deal more needs to be done in order to expand the potential of the Internet to fulfill the President's vision of a "citizen-centered" government that transforms each agency's web presence.

OMB's role under GPEA is to oversee agencies' progress in moving their transactions to an electronic form. As part of this process, I recently instructed agency heads to include certain government-wide management priorities in their own strategic plans, one of which called for expanding e-government. Later this summer we intend to release a Management Agenda that will clarify this issue, explaining how we can expand use of the Internet to make the government more "Citizen-centered" and to achieve greater efficiencies in providing federal information and services, improving connectivity between the government and the public. To drive this agenda forward, a week ago I named Mark A. Forman to serve as Associate Director for Information Technology and E-Government. In this new position within OMB and the Administration, Mr. Forman will work to fulfill the President's vision of using the Internet to create a citizen-centric government.

We also have government-wide initiatives underway to maximize the benefit of electronic government. FirstGov is a government web site that took the first step in providing the public with easy, one-stop access to all online U.S. Federal Government resources. It allows users to browse over 30 million web pages -- everything from researching at the Library of Congress to tracking a NASA mission -- and takes users to important government transactions online. This site is a step toward giving the American people the "Information Age" government they deserve, and we are working to make important improvements to achieve this goal. In addition, work is underway to develop a government-wide Public Key Infrastructure to allow electronic signing while preserving security and privacy.

With our government-wide plans in mind, I would like to give you a general sense of how the various agencies are performing, followed by anecdotal evidence to describe the varying degrees of progress we are finding across the Executive Branch.

Agency Performance

Agency progress in going electronic is mixed. Agencies report that there are close to 6,000 transactions covered by GPEA that do not yet have an electronic option (this does not count the many transactions that are already electronic and thus are not part of the GPEA plans). About 45% claim they will currently meet the deadline with most complying in 2003. Of the remaining 55%, a little over half have a reasonable argument for not making the 2003 deadline. Upon evaluating specific agency plans for complying with GPEA, it is clear some agencies are not prepared.

We have identified a few potential reasons for this. First, some agencies have not yet internalized the need for a robust IT capital planning process. If there is no way to choose effective IT projects from an array of options, then delivering electronic services to the public will be severely hampered. OMB guidance to agencies is to prioritize projects by net-benefit. IT capital planning is the method they must use. A second potential reason relates to the management structure of many agencies. They are divided into bureaus and offices that often act more like independent fiefdoms moving in their own direction. If a Secretary and Department CIO do not have the power to effect change in an agency, then electronic government will be more difficult to deliver.

The Environmental Protection Agency, the Department of Treasury, and the Department of Housing and Urban Development have developed solid plans for meeting the objectives of GPEA. In many instances, they have matched GPEA objectives to the goals of their IT capital planning process and information architecture.

Conversely, the Department of Health and Human Services, the Department of Defense, and the Department of Justice submitted plans to OMB that indicate these agencies have not fully adopted the goals of GPEA and do not have an agency-wide commitment to moving into the electronic arena.

While we will work with all agencies to improve the quality of their plans, it is important that our major focus generally will be in the areas of government where there are high volumes of transactions that have not been re-engineered to take advantage of electronic transmissions. The Department of Treasury, the Social Security Administration, the Department of Veterans Affairs, and the Department of Agriculture perform a large percentage of the major transactions that are not yet electronic.

The Successes

There are several notable examples of programs within agencies that are successfully transitioning within the timelines set forth by GPEA.

The Food and Drug Administration (FDA) reviews close to 8 million shipments of food, drugs, cosmetics and medical devices entering the United States each year. Under OASIS, importers electronically submit documentation that is quickly reviewed on PCs by FDA employees. Minutes after documents are submitted FDA returns its admissibility decisions to the importers. Eighty-five percent of shipments are now handled without paper documentation.

The Patent and Trademark Office provides access to a comprehensive, interactive web-based electronic application that enables all users, from those with little trademark knowledge to experienced attorneys, to file for federal trademark registrations on-line.

The Student Financial Assistance (SFA) Program developed a web-site that provides tools for students and parents to complete the federal financial aid application. This integrated process allows the student/parent to submit information pertinent to filing the original application, to gather renewal application information for subsequent years, and to correct information that was previously filed via application. This suite of Web-based services has become extremely popular.

The Shortcomings

While there are transactions that cannot be transferred to an electronic format or should not because the benefits do not warrant it. Having said that, there are certainly many examples of programs that have limited excuses.

One example is the flight plan (Domestic and International) filings to the FAA that affect millions of public agencies, air carriers, and segments of the aviation industry every year. Even though the process has knowledgeable technology users, a fully electronic option is still not available for most filers. Currently pilots fill out a paper form or use a telephone and someone at the other end must then access the computer system instead of allowing the pilot to interact directly.

Another area for potential gains is in the area of tax filings. While the Department of Treasury, and the IRS in particular, has made progress in implementing electronic government, millions of businesses and individuals still cannot file specialized tax forms on-line. Of the major transactions that currently do not have an electronic option for filing, IRS is responsible for almost a third of them.

Unnecessary Transactions

But before we look at simply converting a paper process to an electronic one we must uncover duplicative reporting requirements and areas where programs can share the information they collect.

The Farm Service Agency (FSA) of USDA requires producers to report planting information for their crops (acreage reports) - a burden of approximately 2 million hours. USDA's Risk Management Agency (RMA) collects nearly identical information from most of the same producers. This is an area where we hope to focus the Department's attention.

Most USDA information collections from crop producers require "face-to-face" contact at local USDA county offices to report the information. For a vast majority of these collections the information is not sensitive enough to demand farmers showing up in person. This requirement may not be necessary.

There are also the positive stories where electronic transactions are being created electronically and information will be shared across government functions.

The International Trade Data System (ITDS) is an ongoing information technology initiative to reduce the paperwork burden on traders by integrating the government-wide collection, use, and dissemination of international trade data. Currently, traders moving goods into and out of the United States are required to provide a vast amount of information to over 100 Federal agencies that use a variety of automated systems and/or paper forms. Under ITDS, traders would submit standardized electronic import and export data one time to a single ITDS collection point. ITDS would then distribute data to agencies depending on what information they need to perform their respective trade-related missions.

The Simplified Tax and Wage Reporting System (STAWRS) is a joint information technology initiative involving the Department of the Treasury, the Department of Labor, the Social Security Administration, and various States. This project seeks to reduce employers' tax and wage reporting burden and to increase the efficiency and effectiveness with which Federal and State governments process and access tax and wage data. STAWRS has conducted pilot projects in three areas: single-point filing by employers of Federal and State tax and wage information, simplifying requirements through the development of a harmonized wage code at the Federal and State level, and streamlining customer service for employers.

I hope these anecdotal examples give the Committee a sense of the challenges that exist, and the areas where OMB would like to focus Agency attention. I thank you for the opportunity to testify, and look forward to working with you to ensure that agencies are meeting the statutory deadline of October 2003.