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.


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:

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)

Resource Management Offices (3)

OMB-Wide Offices (2)

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:


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.