February 3, 1999

The Speaker of the

House of Representatives

Sir:

In accordance with provisions of Public Law 105-277, the Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999, I hereby request the following transfers from the Information Technology Systems and Related Expenses account:
Department of Agriculture

Department of Energy

Department of Health and Human Services

Department of the Interior

Department of Justice

Department of Labor

Department of Transportation

Department of the Treasury

Executive Office of the President

General Services Administration

Small Business Administration

Commodity Futures Trading Commission

Federal Labor Relations Authority

Smithsonian Institution

United States Holocaust Memorial Council

This funding will support Year 2000 compliance activities of Federal agencies.

I hereby designate all of the above requests as emergency requirements pursuant to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended.

The details of these actions are set forth in the enclosed letter from the Director of the Office of Management and Budget. I concur with his comments and observations.

Enclosure


Estimate No.                    3                     
106th Congress, 1st Session                   

February 3, 1999

The President

The White House

Submitted for your consideration are requests to transfer $240 million from the Information Technology Systems and Related Expenses Account for Year 2000 (Y2K) compliance to 15 Federal agencies. This is the third release of contingent emergency funding for Y2K from funds appropriated in P.L. 105-277, the Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999. On November 6, 1998, you allocated $891 million, and on December 8, 1998, you allocated $338 million. In addition, $30 million in emergency funding was released to the Legislative and Judicial Branches when you signed P.L. 105-277.

The contingent emergency funding provided in P.L. 105-277 -- $1.1 billion for defense-related activities and $2.25 billion for non-defense activities -- has enabled Federal agencies to respond effectively to unanticipated Y2K-related issues. With this release of funds, a total of $752 million remains in the contingent emergency reserve for non-defense activities. I will be forwarding a proposal related to the defense funding shortly. I am encouraged by the strong, steady progress that Federal agencies are making. OMB continues its oversight and is working to ensure that agencies have sufficient FY 1999 resources to address Y2K and that flexible contingent emergency funding remains available to address emerging needs.

The requested transfers will continue to support a range of activities to ensure that important computer systems will operate smoothly through the Year 2000 and beyond. Federal agencies would use this funding for various Y2K compliance activities, including remediation for information technology systems, testing to ensure that systems are Y2K compliant, replacement of embedded computer chips, creation and verification of continuity of operations and contingency plans, and cooperative activities with non-Federal entities in support of the Year 2000 Conversion Council. The enclosed requests for transfers are for non-defense agencies; therefore, the funds would be transferred from the Information Technology Systems and Related Expenses account established in P.L. 105-277.

Pursuant to the requirements of Public Law 105-277, OMB will prepare and submit reports to Congress on the proposed allocation and plan for each affected agency to achieve Y2K compliance for technology information systems before funds can be released to the agency. The report for agencies represented in this third release of Y2K contingent emergency funds will be transmitted to the congressional committees specified in P.L. 105-277 concurrent with this request for release of the funds. In addition, OMB has directed each affected agency to provide detailed justification materials in support of its plan and allocation to the relevant appropriations subcommittees. OMB will continue to monitor agency requirements and will address additional funding needs as they emerge.

I recommend that you designate the amounts listed on the enclosure as emergency requirements in accordance with section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended. No further congressional action will be required. Pursuant to P.L. 105-277, funds will be made available to agencies 15 days after this designation is forwarded to Congress.

I have carefully reviewed these proposals and am satisfied that they are necessary at this time. Therefore, I join the heads of the affected Departments and agencies in recommending that you make the requested funds available by signing the enclosed letter to the Speaker of the House of Representatives.

Enclosure


EMERGENCY APPROPRIATIONS: AMOUNTS PREVIOUSLY APPROPRIATED
MADE AVAILABLE BY THE PRESIDENT

YEAR 2000 (Y2K) CONVERSION
Department of Agriculture
Executive Operations, Office of the Chief Information Officer...........

$9,058,000
Department of Energy
Atomic Energy Defense Activities, Other Defense Activities..............

$13,650,000
Department of Health and Human Services
Departmental Management:
   Public Health and Social Services Emergency Fund........................


$93,400,000
Department of the Interior
Departmental Management, Working Capital Fund...........................

$1,530,000
Department of Justice
General Administration, Office of Inspector General..........................

Legal Activities and U.S. Marshals:
   Salaries and Expenses General Legal Activities..............................
   Salaries and Expenses, Antitrust Division.......................................
   Salaries and Expenses, United States Attorneys.............................

Drug Enforcement Administration, Salaries and Expenses..................

Immigration and Naturalization Service, Salaries and Expenses..........

Office of Justice Programs, Justice Assistance...................................

$625,000


$1,554,000
$158,000
$41,077,000

$852,000

$4,600,000

$2,300,000

Department of Labor
Employment and Training Administration, Program Administration.....

Employment Standards Administration, Salaries and Expenses..........

Occupational Safety and Health Administration:
   Salaries and Expenses..................................................................

Mine Safety and Health Administration, Salaries and Expenses..........

Departmental Management, Salaries and Expenses...........................

$468,000

$844,000


$350,000

$402,000

$150,000

Department of Transportation
Office of the Secretary, Salaries and Expenses.................................

Coast Guard, Operating Expenses..................................................

Federal Aviation Administration, Operations.....................................

Federal Aviation Administration, Facilities and Equipment.................

National Highway Traffic Safety Administration:
   Operations and Research.............................................................

Federal Transit Administration, Administrative Expenses...................

$700,000

$7,210,000

$5,247,000

$20,000,000


$752,000

$250,000

Department of the Treasury
Departmental Offices, Salaries and Expenses....................................

Departmental Offices, Automation Enhancement...............................

Bureau of Alcohol, Tobacco and Firearms, Salaries and Expenses....

United States Secret Service, Salaries and Expenses........................

$596,000

$12,500,000

$3,530,000

$695,000

Executive Office of the President
Office of Administration, Salaries and Expenses...............................

$7,666,100
General Services Administration
General Activities, Policy and Operations.........................................

$5,002,000
Small Business Administration
Salaries and Expenses.....................................................................

$3,500,000
Commodity Futures Trading Commission
Commodity Futures Trading Commission..........................................

$356,000
Federal Labor Relations Authority
Salaries and Expenses.....................................................................

$243,000
Smithsonian Institution
Salaries and Expenses, National Gallery of Art.................................

$101,000
United States Holocaust Memorial Council
Holocaust Memorial Council...........................................................

$680,000

The funds made available will enable these agencies to address the Y2K problem by supporting remediation for information technology systems, testing to ensure that systems are indeed Y2K compliant, replacement of embedded computer chips, creation and verification of continuity of operations and contingency plans, and cooperative activities with non-Federal entities in support of the Year 2000 Conversion Council.

February 3, 1999

The Honorable C.W. Bill Young
Chairman
Committee on Appropriations
U.S. House of Representatives
Washington, D.C. 20515

Dear Mr. Chairman:

In accordance with provisions of Public Law 105-277, the Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999, I am transmitting a proposed allocation and plan for Year 2000 (Y2K) compliance activities of the following agencies:

Department of Agriculture [revision]
Department of Energy [revision]
Department of Health and Human Services [revision]
Department of the Interior [revision]
Department of Justice [revision]
Department of Labor [revision]
Department of Transportation [revision]
Department of the Treasury [revision]
Executive Office of the President -- Office of Administration [revision]
General Services Administration [revision]
Small Business Administration [revision]
Commodity Futures Trading Commission
Federal Labor Relations Authority
National Gallery of Art
United States Holocaust Memorial Council [revision]

As noted, for 12 of the agencies listed above, the materials transmitted revise the allocations and plans for these agencies that were submitted on November 6, 1998 and/or December 9, 1998.

In monitoring Federal agency progress towards Y2K compliance, OMB has directed agencies to estimate the total FY 1999 resources necessary for Y2K compliance and related expenses. Further, OMB and the agencies have worked together to determine whether resource requirements associated with Y2K can be accommodated within appropriated levels, or whether contingent emergency funds should be allocated.

For the agencies listed above, the allocation of contingent emergency funds required at this time is displayed on the enclosed table. The table indicates which agencies will be receiving a second and/or third allocation of emergency funding -- those allocations and plans that are being revised -- to demonstrate how their resource requirements have been addressed over time. In addition, all of the agencies listed above have been directed to provide detailed justification materials for these requirements to the committees specified in Public Law 105-277, as well as to the relevant appropriations subcommittees, concurrent with the transmittal of this allocation and plan. These materials detail agency funding requirements associated with systems remediation, and discuss how that funding will assist an agency in achieving Y2K compliance. In addition, funding for activities in support of the President's Council on Year 2000 Conversion is discussed. OMB will continue to monitor agency requirements and will address additional funding needs as they emerge.

OMB's strategy to ensure agency Y2K compliance is predicated on agency accountability. We have systematically monitored agency progress through agency goals for: compliance of mission critical systems, progress on the status of mission critical systems, status of mission critical systems being repaired, and agency Y2K cost estimates.

These performance measures have proved useful in ensuring agency accountability without diverting vital resources from Y2K compliance activities to reporting requirements. Provided with this package is OMB's November 1998 Y2K Quarterly Report to the House and Senate Appropriations Committees, which includes an assessment of these performance measures and the Government's overall progress. In assessing agency progress towards compliance, OMB has focused on the four measures described above. The report also details other initiatives -- such as our work with the States on data exchanges -- that are part of the Administration's overall plan for achieving Y2K compliance.

For most of the agencies listed in this transmittal, the following constitutes the agency plan as required by Public Law 105-277:

For several small, independent agencies included in this transmittal -- the Commodity Futures Trading Commission, the Federal Labor Relations Authority, and the National Gallery of Art -- the justification materials provided serve as the agency plan. OMB has been monitoring the progress of these small agencies, and will ask them to report back on their status.

Thank you again for your cooperation on this important issue.

Enclosure (Allocation of FY 1999 Y2K Funding)

Identical Letter Sent To:

The Honorable C.W. Bill Young
The Honorable David R. Obey
The Honorable Ted Stevens
The Honorable Robert C. Byrd
The Honorable Robert F. Bennett
The Honorable Christopher J. Dodd
The Honorable F. James Sensenbrenner, Jr.
The Honorable George E. Brown, Jr.
The Honorable Dan Burton
The Honorable Henry A. Waxman
The Honorable Stephen Horn
The Honorable James Turner


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