[House Hearing, 106 Congress] [From the U.S. Government Publishing Office] GOVERNMENT ONLINE: STRATEGIES AND CHALLENGES ======================================================================= HEARING before the SUBCOMMITTEE ON GOVERNMENT MANAGEMENT, INFORMATION, AND TECHNOLOGY of the COMMITTEE ON GOVERNMENT REFORM HOUSE OF REPRESENTATIVES ONE HUNDRED SIXTH CONGRESS SECOND SESSION __________ MAY 22, 2000 __________ Serial No. 106-208 __________ 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 71-535 WASHINGTON : 2001 _______________________________________________________________________ For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: (202) 512-1800 Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001 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 ROBERT E. WISE, Jr., West Virginia ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York STEPHEN HORN, California PAUL E. KANJORSKI, Pennsylvania JOHN L. MICA, Florida PATSY T. MINK, Hawaii THOMAS M. DAVIS, Virginia CAROLYN B. MALONEY, New York DAVID M. McINTOSH, Indiana ELEANOR HOLMES NORTON, Washington, MARK E. SOUDER, Indiana DC JOE SCARBOROUGH, Florida CHAKA FATTAH, Pennsylvania STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland MARSHALL ``MARK'' SANFORD, South DENNIS J. KUCINICH, Ohio Carolina ROD R. BLAGOJEVICH, Illinois BOB BARR, Georgia DANNY K. DAVIS, Illinois DAN MILLER, Florida JOHN F. TIERNEY, Massachusetts ASA HUTCHINSON, Arkansas JIM TURNER, Texas LEE TERRY, Nebraska THOMAS H. ALLEN, Maine JUDY BIGGERT, Illinois HAROLD E. FORD, Jr., Tennessee GREG WALDEN, Oregon JANICE D. SCHAKOWSKY, Illinois DOUG OSE, California ------ PAUL RYAN, Wisconsin BERNARD SANDERS, Vermont HELEN CHENOWETH-HAGE, Idaho (Independent) DAVID VITTER, Louisiana Kevin Binger, Staff Director Daniel R. Moll, Deputy Staff Director David A. Kass, Deputy Counsel and Parliamentarian Lisa Smith Arafune, Chief Clerk Phil Schiliro, Minority Staff Director ------ Subcommittee on Government Management, Information, and Technology STEPHEN HORN, California, Chairman JUDY BIGGERT, Illinois JIM TURNER, Texas THOMAS M. DAVIS, Virginia PAUL E. KANJORSKI, Pennsylvania GREG WALDEN, Oregon MAJOR R. OWENS, New York DOUG OSE, California PATSY T. MINK, Hawaii PAUL RYAN, Wisconsin CAROLYN B. MALONEY, New York Ex Officio DAN BURTON, Indiana HENRY A. WAXMAN, California J. Russell George, Staff Director and Chief Counsel Randy Kaplan, Counsel Bryan Sisk, Clerk Trey Henderson, Minority Professional Staff Member C O N T E N T S ---------- Page Hearing held on May 22, 2000..................................... 1 Statement of: McClure, David L., Associate Director, Governmentwide and Defense Information Systems, General Accounting Office; George R. Molaski, Chief Information Officer, Department of Transportation; Donald W. Upson, Secretary of Technology, Commonwealth of Virginia; Patricia McGinnis, president and chief executive officer, Council for Excellence in Government; David Gardiner, vice president, architecture and technology, Unisys Corp.; Lee Cooper, vice president business development, U.S. Federal Government Group; and Kathleen deLaski, group director, editorial products, America Online............................................. 3 Letters, statements, etc., submitted for the record by: deLaski, Kathleen, group director, editorial products, America Online, prepared statement of...................... 76 Gardiner, David, vice president, architecture and technology, Unisys Corp., prepared statement of........................ 58 McClure, David L., Associate Director, Governmentwide and Defense Information Systems, General Accounting Office, prepared statement of...................................... 7 McGinnis, Patricia, president and chief executive officer, Council for Excellence in Government, prepared statement of 51 Molaski, George R., Chief Information Officer, Department of Transportation, prepared statement of...................... 30 Upson, Donald W., Secretary of Technology, Commonwealth of Virginia, prepared statement of............................ 41 GOVERNMENT ONLINE: STRATEGIES AND CHALLENGES ---------- MONDAY, MAY 22, 2000 House of Representatives, Subcommittee on Government Management, Information, and Technology, Committee on Government Reform, Herndon, VA. The subcommittee met, pursuant to notice, at 1 p.m., in the Auditorium, Center for Innovative Technology, Herndon, VA, Hon. Stephen Horn (chairman of the subcommittee) presiding. Present: Representatives Horn and Davis. Staff present: J. Russell George, staff director and chief counsel; Randy Kaplan, counsel; Bonnie Heald, director of communications; Bryan Sisk, clerk; Elizabeth Seong and Michael Soon, interns; Melissa Wojciak, professional staff member, Subcommittee on the District of Columbia; Barbara Tempel, community outreach director for Representative Davis; John Hicks, audio/visual technician, Center for Innovative Technology; Trey Henderson, minority counsel; and Jean Gosa, minority clerk. Mr. Horn. A quorum being present, the Subcommittee on Government Management, Information, and Technology will come to order. New and emerging information technology is revolutionizing the way citizens communicate with their Federal Government. The Government's gradual transformation to electronic government-- or e-government--already provides Internet users with access to more than 20,000 Federal Web sites. In addition to providing useful information, many agencies have begun offering interactive, on-line services. Today Internet users on-line can file their income tax return, buy coins from the U.S. Mint or reserve a campsite at a U.S. park. On-line procurement programs, such as the General Services Administration Advantage program, allow Federal agencies to buy supplies and equipment with the click of a mouse button. Other procurement programs provide information on government contracts. This improved service reduces both the time and cost of doing business with the Government. By the end of this year, nearly 40 million Americans will communicate with the Government electronically. And that demand will swell as even more people join the information age. Electronic government offers the potential to reinvent the way citizens and businesses alike interact with government. The benefits of this new form of government are plentiful, and the challenges profound. To be successful, government Web sites must be well organized and readily accessible, which is not necessarily true today. Citizens and businesses should expect government Web sites to offer the same quality and service found on many business Web sites. They must be confident that their on-line communications with the Government are secure and personal information is fully protected. Additionally, the large investment necessary to create the Government's electronic infrastructure must be carefully planned and managed to avoid risking the loss of billions of taxpayer dollars. We must bridge the digital divide so that citizens have access to this new electronic environment. With proper education and training the Federal work force can be up to the challenge. Currently, there is a nationwide shortage of skilled information technology workers. Over the next few years, a substantial number of Federal employees will retire. Others who are skilled in information technology will leave government service for more lucrative opportunities in the private sector. Where possible, the executive branch must find creative ways to retain and retrain this vitally important work force. If that fails, the new civil servants must gain the skills needed for the times in which we live. Today we will hear from a number of experts from both the public and private sector who will discuss this very important subject. I thank the gentleman from Virginia, Representative Tom Davis, who is a member of our subcommittee, and the Center for Innovative Technology for hosting today's hearing. We welcome our distinguished panel of witnesses and look forward to their testimony. And now I ask if the gentleman from Virginia, Mr. Davis has an opening statement he would like to make. Mr. Davis. Good afternoon, Mr. Chairman, and thank you for holding this important statement. I ask that my complete statement be put in the record. Mr. Horn. Without objection. Mr. Davis. I want to welcome all the panelists for being here both from the private sector and government sector and say that I have to leave early, so I will keep my remarks brief and let you proceed. Mr. Horn. Thank you. We will now start with the presentations, and let me say we will go down the witness list in the order you see, and we will swear in the panel, which is what we do in the Committee on Government Reform, and we also-- the minute we introduce you your complete document is automatically put in the record. We would like you to summarize within 5 minutes if you can. If you run over we won't be rigid about it, but we would like a summary and this focuses your testimony. We have had a chance to read many of the testimonies, but not all of them, and some people are missing today. So if you would stand ready to affirm and swear and take the oath. [Witnesses sworn.] Mr. Horn. We will start with David L. McClure, Associate Director, Governmentwide and Defense Information Systems, of the legislative branch's General Accounting Office. They are usually good witnesses to begin with. They do superb work around the country in the executive branch. Please proceed. STATEMENTS OF DAVID L. McCLURE, ASSOCIATE DIRECTOR, GOVERNMENTWIDE AND DEFENSE INFORMATION SYSTEMS, GENERAL ACCOUNTING OFFICE; GEORGE R. MOLASKI, CHIEF INFORMATION OFFICER, DEPARTMENT OF TRANSPORTATION; DONALD W. UPSON, SECRETARY OF TECHNOLOGY, COMMONWEALTH OF VIRGINIA; PATRICIA McGINNIS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, COUNCIL FOR EXCELLENCE IN GOVERNMENT; DAVID GARDINER, VICE PRESIDENT, ARCHITECTURE AND TECHNOLOGY, UNISYS CORP.; LEE COOPER, VICE PRESIDENT BUSINESS DEVELOPMENT, U.S. FEDERAL GOVERNMENT GROUP; AND KATHLEEN deLASKI, GROUP DIRECTOR, EDITORIAL PRODUCTS, AMERICA ONLINE Mr. McClure. Good afternoon, Mr. Chairman and members of the subcommittee. I appreciate the opportunity to be here today with the panel of experts in e-business and e-government that you and your staff have assembled. As you know, e-commerce, e-business and now e-government are topics of growing interest in the Congress. GAO is conducting numerous reviews involving on-line or Internet- related information issues, such as Web site privacy policies, State taxation of Internet sales, Smartcard and purchase card use and Internet access competition. The Internet offers unique opportunities for government agencies to improve internal operations and provide on-line public access to information and services. But, as the recent rash of computer viruses have served to illustrate, this increased open interconnectivity and convenience comes with risks that must be mitigated, notably security and privacy. In my remarks today I will focus on three points: One, the drivers behind electronic government; two, the opportunities opening up with the Government agency use of the Internet; and, third, five specific challenges that are confronting e- government that deserve increased attention. First, let me touch on some of the critical drivers behind e-government. The Federal Government's movement toward greater use of on- line service delivery and citizen and business access is being pushed by market forces in private industry. There are also great expectations for electronic government that comes from a diverse statutory and policy framework such as statutes authorizing agency programs and general management status that explicitly call for electronic or on-line access. In addition, the executive branch has issued numerous policies that began as early as 1993 with the NPR. All of these actions are prompted in large part by a need for the Government to tangibly demonstrate an ability to improve its services and access to citizens and a recognition that Web-based technologies can provide a friendly citizen interface over sometimes confusing and suboptimized government structures, responsibilities and processes. That brings me to my second major point. The Government's use of the Internet is evolving. For the most part, there seems to be a consensus that governments are in the early stages of shifting to citizen-centered services via the Internet. However, it is being accelerated by quick advances in Web-based technologies, improved software applications, and a phenomenal growth in Internet access and usage. In the interest of simplicity and time, let me just point out some examples in three areas that are common across all levels of government. The first area is interactive communication and information dissemination such as Access America for Seniors, an entry portal for seniors to reach diverse government information on benefits, taxes, health and nutrition and consumer protection. Second, are transactions and applications such as IRS' electronic tax administration program, which makes use of the Web to allow citizens to file taxes via the Internet. Third are on-line procurement activities such as GSA's Electronic Posting System, a pilot program that allows vendors to search for contracting opportunities over $25,000, including solicitations and awards, as well as GSA Advantage, which allows agencies to search for products and services and place orders from GSA's Federal supply schedule contractors. Now let me turn to the five challenges that really confront us in making the transition to full electronic service delivery. These are not insurmountable areas but they deserve attention. The first is adequate executive management leadership and involvement. Given our many hearings with you, Mr. Chairman, I feel like I am preaching to the choir on this issue. Our best practices studies at GAO confirm that top management leadership, involvement, ownership, and vision are the cornerstone of any information technology initiatives. Delegating everything to technologists can be dangerous. In our rush to electronic service delivery, it is important to remember fundamental principles and practices of good IT planning and management--they equally apply to effective customer-centric Web-based applications. For example, using such things as measurable performance improvement expectations, risk identification and mitigation strategies, and using industry standard technology and solutions where appropriate. Perhaps the most pressing leadership challenge is how to best use the Internet to deliver services to citizens and business partners. The administration, through the efforts of agencies, NPRG, the National Partnership for Reinventing Government, and the Council of Excellence in Government is focused on efforts to help bridge this gap. At present we are confronted with realities of disparities in Internet access across citizen groups, rural area populations and the disabled and small businesses also have problems with getting Internet access as well. How we ensure continued service delivery to these segments while increasing their ability to participate in this electronic environment is an important issue. Multiple access methods to government service, via phone, fax, public kiosks, may be essential to supplement Internet use. The second challenge is developing a ``citizen as customer'' focus in government. The Internet is forcing organizations to rethink basic business and service delivery processes. How customers digest information and services in a viewable electronic format can significantly differ from traditional ways of thinking. Certainly as Internet usage matures for government, citizens may expect more consistent levels of service across agencies, such as highly navigable Web sites, intelligent search capabilities that go beyond static posting of information, and interoperable authentication policies and methods. That brings me to my third challenge, security and privacy. Clearly all participants in the Internet age have to feel comfortable with using electronic means to carry out private and sensitive transactions, whether it be obtaining a license, to bidding on a contract, paying taxes, or receiving a benefit claim. That comfort level varies right now and concerns are certainly not unjustified. As our work has pointed out, information security weaknesses persist across the Federal Government and they are compounded by the openness of the Internet. The Melissa, ``ILoveYou'' and now the ``NewLove'' computer viruses remind us that the interconnectivity of the Internet warrants special attention to security and privacy issues. A big piece of the solution to this problem will be the continued development and implementation of the Public Key Infrastructure [PKI], technology. Stated simply, PKI is a system of computers, software, and data that rely on specific cryptographic techniques to secure on-line messages or transactions. There are some 24 PKI pilot programs in place across the Federal Government. There are some key questions involving the interoperability of certificates used in these programs. GSA is leading a governmentwide effort to facilitate public secure access to government information and services through its ACES, or Access Certificates for Electronic Services program. Experience has been limited to date, with the first vendor authorized to issue certificates just last month. The fourth challenge deals with other technology-related issues associated with e-government that simply cannot be ignored. Computers and networks allow information and services to be organized in dramatic new ways. Adequate technical infrastructure is absolutely essential for the Federal Government to move in this direction. That means that network capacity planning and acquisitions to support both the increased electronic traffic and the diverse voice, data, and video offerings are necessary. Operating system and software reliability matters take on a new level of priority when your transactions move on-line, especially in a 7-day a week, 24- hour environment. Good business and system architecture planning are also two areas where GAO has done significant work, and it must be done well to avoid increased and unnecessary investment costs, development times, and performance shortcomings. The fifth and final challenge deals with human capital issues. This year it is estimated that employers will seek to fill 1.6 million new IT jobs, with the greatest demand for enterprise systems integration and Web development positions. We have a situation of high work complexity and scarcity of qualified applicants. The public and private sectors are competing with each other in these areas and the Federal Government is increasing its outsourced IT services and development, it has further increased the demand for traditional skills like project and contract management. In conclusion, Mr. Chairman, in the future, the promise of Internet-based technologies offers exciting new ways for government to more effectively and efficiently interact with and provide services to citizens. It is already happening, as advanced by the examples I have offered and those yet to be discussed by our other panelists. The Federal Government is certainly not standing still, and expectations, if not set by citizens themselves, are clearly set both by law and Presidential actions. The speed, the pace and the direction of Internet-based solutions in government will vary. They must effectively deal with so many of the same basic challenges that all technology initiatives face in both the public and private sector. Government executives must work effectively with their CIOs and they must embrace e-government proposals and work with Congress to develop effective investment strategies that will make them realities, and we must expect that these investments demonstrate their impact by lowering costs, raising productivity, enhancing service delivery quality and timeliness, and freeing up resources and management attention for other problem areas and priorities. Thank you, Mr. Chairman. That concludes my remarks. I will be happy to respond to any questions. [The prepared statement of Mr. McClure follows:] [GRAPHIC] [TIFF OMITTED] T1535.001 [GRAPHIC] [TIFF OMITTED] T1535.002 [GRAPHIC] [TIFF OMITTED] T1535.003 [GRAPHIC] [TIFF OMITTED] T1535.004 [GRAPHIC] [TIFF OMITTED] T1535.005 [GRAPHIC] [TIFF OMITTED] T1535.006 [GRAPHIC] [TIFF OMITTED] T1535.007 [GRAPHIC] [TIFF OMITTED] T1535.008 [GRAPHIC] [TIFF OMITTED] T1535.009 [GRAPHIC] [TIFF OMITTED] T1535.010 [GRAPHIC] [TIFF OMITTED] T1535.011 [GRAPHIC] [TIFF OMITTED] T1535.012 [GRAPHIC] [TIFF OMITTED] T1535.013 [GRAPHIC] [TIFF OMITTED] T1535.014 [GRAPHIC] [TIFF OMITTED] T1535.015 [GRAPHIC] [TIFF OMITTED] T1535.016 [GRAPHIC] [TIFF OMITTED] T1535.017 [GRAPHIC] [TIFF OMITTED] T1535.018 [GRAPHIC] [TIFF OMITTED] T1535.019 [GRAPHIC] [TIFF OMITTED] T1535.020 [GRAPHIC] [TIFF OMITTED] T1535.021 Mr. Horn. Thank you, Mr. McClure. Mr. Molaski, we are delighted to have you with us. He is the Chief Information Officer from the Department of Transportation. Mr. Molaski. Thank you very much, Chairman Horn and Congressman Davis, for this opportunity to discuss electronic government. I am pleased to be making my first appearance before the subcommittee to address the challenges and opportunities we face in migrating to an e-government environment. I appreciate having the opportunity to offer the perspective of someone who up until last June worked in the information technology environment as president of an Internet company and now is a Federal Chief Information Officer and also serving as co-chair for the E-government Committee for the CIO Council. As most of us here today realize, we are sitting on the threshold of a major transformation of government. Industry has shown the effective use of Intra and Internet companies to build stronger ties with their customers, deliver information and services more effectively, and drive costs out of business processes. Government has made the first steps down the same operations road, but we must more fully embrace the use of these and future technology advances to truly transform government into a customer-centric, interactive, responsive, results-based entity that prides itself in the effective low cost delivery of services to its stakeholders. We have the opportunity to make this vision a reality. However, we must be willing to change traditional ways of doing business and learn to operate in Web time. As a start, we could reduce our dependency on paper processes and make doing business electronically our modus operandi. Accepting information electronically instead of requiring multiple paper copies of documents would improve efficiency and be environmentally friendly. While we as a government need to move farther faster, much has been accomplished. The Government has created over 20,000 Web sites, containing over 100 million Web pages. Citizens can now buy coins from the U.S. Mint site, students can apply and find the status of their loan application on the Department of Education student loan site. Drivers can find the results of automobile crash tests from our NHTSA website. Computer road warriors can have better information on the status of a flight than passenger agents at an airport by viewing an FAA radar feed available on many travel Web sites. However, many Federal Government stakeholders do not know where in the Government to go to get information or instructions on how to do something. Work is underway to develop a central access Web site to government that would serve as an electronic service center/help desk to guide the stakeholder to the site or the person that can provide the requested information or answer questions that the individual stakeholder has. This would be a unique and a valuable contribution by government to its citizens. This gateway to government Web site would be more attuned to the information and service needs of the public and what they are getting from the commercial sites. I consider this type of site to have wow factor and by that I mean when citizens come up there they can say, wow, my government finally got it right. But to truly take advantage of the opportunities e-government brings, we must move beyond providing information and services or doing transactions over the Web. We need to make them partners in the deliberations on issues we are wrestling with and be responsive to their suggestions for improvements, streamlining and providing new services, or eliminating outdated services. When we look at the Internet, the Internet was built really as a Web of communication of individuals out there. It was not built on just providing information or doing transactions. Those are really no brainers, but when we get to the point where we are truly interacting with citizens out there and stakeholders, then we have really accomplished something. I have included in my testimony three areas where we talk about having structural changes, and that is looking at the CIOs and the authority CIOs have. That is taking a look at the work force challenge that we have, and that was reported in June 1999 on ``Meeting the Federal IT Workforce Challenge,'' done by the CIO Council, which is done on the Web site www.cio.gov, and then finally it is taking a look at what happens when we get to e-government, and what e-government is going to reveal is a lot of the stovepipes that we have both in all branches of government, and we need to think ahead. When somebody puts in a request for exports and allowing them to export something and gets multiple Web sites coming up with multiple sites, how are we going to handle--what process are we going to put in place to really take a look at how we consolidate those types of activities within government. Thank you very much, Mr. Chairman, and I will be glad to answer your questions. [The prepared statement of Mr. Molaski follows:] [GRAPHIC] [TIFF OMITTED] T1535.022 [GRAPHIC] [TIFF OMITTED] T1535.023 [GRAPHIC] [TIFF OMITTED] T1535.024 [GRAPHIC] [TIFF OMITTED] T1535.025 [GRAPHIC] [TIFF OMITTED] T1535.026 [GRAPHIC] [TIFF OMITTED] T1535.027 [GRAPHIC] [TIFF OMITTED] T1535.028 [GRAPHIC] [TIFF OMITTED] T1535.029 [GRAPHIC] [TIFF OMITTED] T1535.030 Mr. Horn. Thank you very much. That is a very helpful presentation. And now I am delighted to see that the Honorable Don Upson, Secretary of Technology for the Commonwealth of Virginia, has made it out of the suburban traffic of Richmond up to the beautiful part of northern Virginia. Mr. Davis. May I say one word on the Honorable Don Upson. I had the privilege of working with Mr. Upson in our previous lives in the private sector and he has been a mentor to me on a number of these issues, and he used to be a staff member of this committee. He is the first Secretary of Technology. I am pleased to welcome you here. Mr. Horn. And he is a graduate of the beautiful campus. That was known as the playboy school. However, he did learn computing along the way. I have to swear you in, as you know. [Witness sworn.] Mr. Upson. Mr. Chairman, members of the committee, subcommittee, welcome. As a former Republican staff director of Government Operations, it is a pleasure to be here and it is a pleasure to be here in this building, which is in the Center of Innovative Technology. I always welcome people to northern Virginia, which is the most exciting place on the planet in the most exciting period of the history of man. Congressman Tom Davis welcomes people to his congressional district and it is both the same. Mr. Chairman, I know my testimony is going into the record. I would like to talk about a couple of things that I think we are doing that are special in Virginia and how that might translate into what you are trying to do at the Federal level. What I think is special and at the forefront is that the chief executive walks the talk and Governor Gilmore put in place a structure of government for technology which I think links the critical functions of infrastructure with policy. If you look at what is going on in the private sector today, the chief information officers are very quickly the heirs to be chief executive officers in the next generation of leadership in corporate America. The infrastructure is the enterprise and as someone who took this job with a little trepidation, having worked in your field for a long time, I wasn't sure where this would go, and I can tell you there is an appreciation in Virginia, time and time and time again I get pulled aside. If you are doing your job you are stepping on toes, and I think you know where those toes are because we need a government that is responsive as an enterprise to the needs of our citizens. Our vision for technology in general: Generally, the Governor views technology as the focus for his administration to do two things. One, we have an objective to create the best business environment anywhere. Two, provide all our citizens access to this new economy. Government should serve those functions, but I would ask and I think what we have done special in Virginia is, with the chief executive support, created an Interagency Management Council which reports at the right level of government, and I think often that has been the one of the issues at the Federal level. I have an Interagency Management Council that meets monthly, and it is that council, 23 members, 17 from each major agency and department, what they do is meet monthly and they are charged with creating electronic government, creating a desk top environment that is standard, fast, and permanently modern, which gets to this whole notion of leasing versus buying computers, which you will find often occurs agency by agency, platform by platform. A digital signature environment. Without a real digital signature environment, there is no electronic government. Privacy and security. Now, to us electronic government, while these individuals have respective close leadership in their organization, they also meet monthly and are ordained by the Governor to put in place enterprise systems. It is not good enough that agencies take their functions and put them on-line. What is important is that when things go on-line, they are coordinated, they are in uniform communications. Our vision is of a citizen looking through a single port executing multiple transactions across multiple agencies with a single digital signal. To get there, we have to have a buy-in from the agencies themselves, and I think that is what we created through our council. The Governor has issued one executive order requiring priorities for each agency, their priorities for electronic government to be put in place and submitted to the Secretary of Technology by June 1. He is following that up this week with what may be one of the most comprehensive electronic government executive orders anywhere, asking implementation plans for seed management from every agency of government. Seed management is not a contract in Virginia. It is an initiative to put permanent state-of-the-art technology on every desktop. Digital signatures. It is not important that every agency puts in place the digital signature plan. We have to have a single policy that cuts across all platforms, all agencies. Security of our data, which is one of the biggest concerns to citizens, isn't about police protecting their data one way and corrections protecting it another and the tax system another. That puts all systems at a high level of vulnerability. It is about a scalable, standardized security environment, and you don't get there unless you have the buy-in and cooperation of the participating agencies. I see my yellow light is on. I would like to end that the Federal Government, we interact quite regularly with the Federal Government, especially in the area of procurement. It has done much in the area of procurement. But I think what is-- and it is great that there is a CIO Council. I think the questions that you have to ask in your positions, are the officers that hold those positions at the right level. It will be a rare Assistant Secretary of CIO that you find at the Federal level that thinks have not changed much, and it is a rare Secretary that asks for technology and how does technology play or not play in this, and it is establishing that link between the person that controls the infrastructure and the policy that I think is what we have done in Virginia. I think it has captured the imagination and interest of our communication and education community and our Governor, and the red light went off. Thank you, Mr. Chairman, for having me. [The prepared statement of Mr. Upson follows:] [GRAPHIC] [TIFF OMITTED] T1535.031 [GRAPHIC] [TIFF OMITTED] T1535.032 [GRAPHIC] [TIFF OMITTED] T1535.033 [GRAPHIC] [TIFF OMITTED] T1535.034 [GRAPHIC] [TIFF OMITTED] T1535.035 [GRAPHIC] [TIFF OMITTED] T1535.036 [GRAPHIC] [TIFF OMITTED] T1535.037 Mr. Horn. We appreciate you coming and your last comments get into CIO placement. You are absolutely correct. We now go to the president and Chief Executive Officer, Council for Excellence in Government. Ms. McGinnis. Thank you, Mr. Chairman. I want to applaud your leadership in creating this conversation to imagine the possibilities of e-government and designing a strategy to carry it out. The Center for Innovative Technology is a perfect setting for this hearing, and the conversation is really about connecting government with the American people, and in this part of Virginia there is a lot of connecting going on with very entrepreneurial enterprises not only thinking about pushing the envelope of technology but focusing on delighting their customers. Kathleen deLaski from AOL is here and it is definitely one. There are many others. My organization is the Council for Excellence in Government. We are a nonpartisan, nonprofit group of leaders in the private sector who have served in government and are committed to improving its performance and also raising the understanding, participation, and confidence of the American people in government, so our work is aimed at two audiences: First, people in government with whom we have worked to improve results and leadership and actually get results in the public interest and also the American people, most of whom at this point say they feel disconnected from government. According to a poll that was conducted for the council last year by Peter Hart and Bob Teeter, most Americans, especially young people, say that government is no longer of, by, and for the people. They think of it as the Government rather than our government and we take this as a significant challenge that the work that you are doing can go a long way to address that. The good news in our research is that most Americans, again especially young people, think that in terms of improving people's lives, government will play an equally or more important role in the future and they see themselves as an important part of the solution, even more than elected officials, by the way. They want to be more involved, and I think these initiatives are going to provide that opportunity. So with a mission as important as excellence in government and an audience as large as the American people, naturally we have focused on information technology and the Internet as a way of accelerating change and also as a leadership tool. Imagine government of, by, and for the people and proceed that way, hopefully perceived that way, where all Americans can choose to go on-line anytime, anywhere, not only for the information they need but also to complete transactions, receive services, conduct research, interact with their representatives, and even to vote. Imagine people in government creatively managing for results, from curing diseases to regulating health and safety to providing Social Security and Medicare benefits in a seamless network which crosses agency and process boundaries and seeks to serve the public interest. That is the vision of e-government that has been created by our Intergovernmental Technology Leadership Consortium and a very substantial e-government initiative that we have undertaken, involving 100 leaders from the public and private sector, the research community and the nonprofit community. We have held two major meetings, one at the Smithsonian, a historic setting, and the other one here at CIT last March, and the people involved have organized themselves into four working groups addressing four issues. First, they are looking at transformation by addressing the challenge of transforming rather than simply automating government. Thinking about the culture, the organization, the processes, how it all works. Second, they are looking at the roles of the public and private sector in terms of who should do what, what are the comparative advantages in creating the e-government that we seek. Third, we are looking at infrastructure, addressing the issues that have been raised this morning and are extremely important, issues of privacy, security and authentication. And fourth, we are looking at information. That is the content, format, architecture and accessibility of information. The Congress has put a stake in the ground through the Paperwork Reduction Act, saying that all Federal services and transactions will be offered on-line by 2003. We have got a long way to go but I think we can meet that goal and the e- government initiative that we have put together is aimed at helping to meet that goal. We are not at this point ready to offer specific recommendations. We plan to have a blueprint and release it in the fall. When you have 100 people working together, you want to be careful that you consider all of the options and listen to different perspectives before you end up with specific recommendations, but there are several principles which will guide our blueprint and I think will help in your deliberations as well. We envision e-government as, first, citizen driven and user friendly. More and more people are becoming accustomed to using the Internet 24 hours a day, 7 days a week, and information has to be organized to how people will use it rather than how the agencies create it. People want one-stop access without having to go from Web site to Web site. We actually said in our last meeting ``three clicks to satisfaction'' ought to be the motto for e-government. Second, it has to be responsive and results oriented, and by that I mean not just providing information but allowing people to actually complete transactions and receive services on-line. The best example is in Virginia, where citizens can renew their driver's licenses on-line. This was mentioned in a conference a couple of weeks ago and the whole room broke out in applause. There are Federal services and transactions that occur on-line, you can file for taxes and apply for student aid, but it is still a very small percentage and it needs to grow. Third, e-government has to be universally accessible. You mentioned the digital divide. It is real and we need to address it. We need to be careful not to lock into any one technology in addressing it because it may be through hand-held devices, cable television, in addition to computers and all of the efforts that are going on in communities, libraries, schools and homes. We can't address this, but it has to be done. Fourth, e-government has to be collaborative. That is the public and private sectors working together doing what they do best. And the Federal Government has to play a certain role, but the private sector has a lot to contribute and we need to figure out how to harness that in an accountable way. Fifth, it has to be innovative, not just thinking about transactions. We gave an Innovations in American Government Award last year, for example, to the Centers for Disease Control for an Internet tracking system for DNA fingerprinting of foodborne diseases so the E. coli breakout of a few years ago will never have the impact again because it will be tracked down too fast. Sixth, it has to be cost effective, and we know that it can be cost effective. IBM's Institute for Electronic Government, one of our partners, has indicated that the governments that they are working with are saving up to 70 percent by moving services on-line. The Department of Agriculture, as you know, issued its organic food standard regulations on-line and received more comments than ever in history and saved money. The administrative costs were $300,000 less than they expected. And seventh, it has to be of course secure and private. There has been a lot of discussion about that. There is no question that we have to address that issue. The transformation to e-government will require leadership at all levels starting at the top, and that has been mentioned a number of times. It will require significant investments in technology and people. Even though there may be savings in the long term, I think we can also look at some up front investments and, particularly, investing in ways that can cross agency boundaries that we are all confronted with, and a lot more flexibility in funding and personnel policies. Perhaps as we consider what it will take to attract, develop and retain a high quality information technology work force in the Federal Government, and we have to do that, we will also discover ways to invigorate the Federal civil service. We welcome the opportunity to help you design a system for e-government which cannot only improve performance but also help deliver government back to the American people. Thank you. [The prepared statement of Ms. McGinnis follows:] [GRAPHIC] [TIFF OMITTED] T1535.038 [GRAPHIC] [TIFF OMITTED] T1535.039 [GRAPHIC] [TIFF OMITTED] T1535.040 [GRAPHIC] [TIFF OMITTED] T1535.041 [GRAPHIC] [TIFF OMITTED] T1535.042 Mr. Horn. Thank you. That is very helpful. We will take up that offer. Our next panelist is somewhere in the midst of Philadelphia, so David Gardiner did not make it. He is the vice president, architecture and technology of Unisys Corp., but Lee Cooper is here in his stead. He is the vice president, business development, U.S. Federal Government Group. It is nice to have you here. Mr. Cooper. Thank you, Mr. Chairman, and Mr. Davis, for the opportunity to share with you my observations on the dynamic changes taking place in the e-business arena today. My name is Lee Cooper and I am the vice president of Business Development at Unisys Corp. I am testifying on behalf of both Unisys and the Professional Services Council, of which Unisys is a long- standing member. The Professional Services Council is the principle trade association representing the professional and technical services industry. This segment performs more than $400 billion in services nationally, including over $100 billion annually in support of the Federal Government. Unisys is a $7\1/2\ billion electronic business solutions company whose 36,000 employees help customers in 100 countries build and manage the infrastructure they need to conduct e- business. Unisys derives about $1 billion of its annual revenues from business conducted from within the U.S. Federal Government, from the Federal Government Group headquartered in McLean, VA. Let me begin by providing a framework for where Unisys believes the e-business marketplace to be heading. I would like to summarize points made in the written testimony submitted to the committee. These points are derived from our experience at Unisys as we have strived to become a premier e-business company. There are three main ideas. First, we see an emerging 7 by 24 electronic business environment that will require new levels of computing and network infrastructure. We believe that e- business will really be about managing the growth of the number of transactions conducted electronically. As commercial organizations increasingly interact electronically with our customers, suppliers and employees, new service standards are quickly emerging. These new standards will address efficiencies, speed and value. Governments are serving the same end users, therefore we believe that these same service expectations will become the baseline for interactions with the Government. Cost efficiencies are part of the benefit accruing to commercial organizations from electronically serving their customers. The cost of an electronic transaction is pennies compared to a direct face-to-face interaction with a customer service employee. This means that there are cost reduction opportunities for governmental organizations that adopt e- business models of operation. It also means that commercial e- business organizations will increasingly compete to outsource government services if government computing infrastructures are unable to handle a constituent's service needs in a similar manner. Second, our experiences at Unisys suggest that once the computing and network infrastructure is in place, organizations should expect a rapid acceleration of e-mail, voice mail, and other computer based communications volume leading to vibrant e-communities. We use that term to describe large groups of people connected by organizational and other ties, electronically communicating with each other at high intensity. We have found once a global e-mail standard was established, we saw e-mail volume explode. We are now managing over a million per day and the volume continues to grow. We believe that government organizations should anticipate similar results as they interconnect their employees. Government should also prepare for the challenging technology resource management issues associated with these tools. Examples are desk top hardware complexity, network bandwidth growth and support personnel retention. We see opportunities to develop information portals which can help address productivity opportunities and strengthen organizational culture. Unisys defines a portal as a Web site that provides a common meeting ground for a population that shares a common interest or organizational mission. The best portals provide a means to easily locate information and use. They also provide access to other internal and external Web sites and databases. Portals can be equally effective in attracting customers and constituents with news, general information and transaction capabilities. Unisys believes that portal development holds strong promise for progressive organizations of all types. Third, computing and networking infrastructure needed for the e-business environment also facilitates delivery of sophisticated Web-based tools to improve manager and employee productivity, satisfaction and loyalty, and allows deployment of world class business processes. These tools, now in wide commercial implementation, will quickly become a standard that commercial and public sector organizations will implement. One example is the electronic customer relationship management. Customer relationship management is on-line automation of the monitoring and management of customer transactions and relationships. This is a key requirement in the e-business world. As governments continue their shift to viewing constituents as customers, the likelihood is that the CRM tools now transforming commercial organizations will be adopted by the public sector with similar transformational impact. Government organizations may find this direction challenging, especially where incumbent legacy systems are well-ingrained and process culture and employee acceptance. But over the longer period, adoption of world class solutions for core process delivers the best performance results. In closing, let me underscore one important point. The key benefits in productivity, communication, speed of operation, service quality, and value delivery that derive from the e- business transformation that Unisys and other commercial organizations are now pursuing are dependent on a robust, innovative, standards-based computing, and network infrastructure. Successful deployment of e-business capability in the commercial and public sector will depend on that infrastructure. Thank you, Mr. Chairman. [The prepared statement of Mr. Gardiner follows:] [GRAPHIC] [TIFF OMITTED] T1535.043 [GRAPHIC] [TIFF OMITTED] T1535.044 [GRAPHIC] [TIFF OMITTED] T1535.045 [GRAPHIC] [TIFF OMITTED] T1535.046 [GRAPHIC] [TIFF OMITTED] T1535.047 [GRAPHIC] [TIFF OMITTED] T1535.048 [GRAPHIC] [TIFF OMITTED] T1535.049 [GRAPHIC] [TIFF OMITTED] T1535.050 [GRAPHIC] [TIFF OMITTED] T1535.051 [GRAPHIC] [TIFF OMITTED] T1535.052 [GRAPHIC] [TIFF OMITTED] T1535.053 [GRAPHIC] [TIFF OMITTED] T1535.054 [GRAPHIC] [TIFF OMITTED] T1535.055 [GRAPHIC] [TIFF OMITTED] T1535.056 [GRAPHIC] [TIFF OMITTED] T1535.057 [GRAPHIC] [TIFF OMITTED] T1535.058 Mr. Horn. Thank you very much. We appreciate that. Give Mr. Gardiner our best. We are sorry that he couldn't make it. You did a great job. Our last presenter is Kathleen deLaski, group director, editorial products, America Online. I hope you have stock options. Ms. deLaski. Of course. Welcome to our neighborhood. Thank you, Chairman Horn, for inviting me to speak and Representative Davis as well. In the lobby of AOL, which is just down the road, our plaque that states our mission statement is that we strive to make the Internet central to people's lives, as central to their lives as the telephone and the television and even more convenient, and nowhere more so in e-government is the opportunity to reinvent, to borrow another expression, is this more prevalent than in the government space. We began--we saw the promise in 1996 and began in the Presidential cycle that year trying to develop ways that consumers could have on-demand access to information about the candidates that were running against each other, to be able to cut through the 30-second sound bites. We saw even at that early stage hundreds of thousands, more than a million visitors to that kind of information, and we saw the promise then. In 1998, we developed a site called My Government, which allowed a member--our members; in other words, citizens, to type in their ZIP Code and up pops the pictures and contact information for all of the people that represent them down through the State level so you could e-mail and track their votes. That also was very successful. In late 1999, we launched a brand new service, Government Guide. We saw the explosion coming of services, as we have all been talking today, on the Web, and we began to try to figure out what is the best way to present that to the consumer and it quickly became apparent that you needed to organize it by consumer needs instead of by agencies. And we are in the middle of developing a State and local version of this, but the piece that we launched last December is mainly a Federal site. It is called Government Guide on AOL. It is also on the Web. I brought--since we couldn't show pictures of it, I brought some color copies so you can see what it looks like afterwards. But it has been very successful and it says to us that the demand is there, as most of us suspected. But our way of doing it is to--for instance, we have developed checklists, government checklists that allow you to answer a series of questions about paying for college through Federal student loans, can I file my taxes electronically. We partnered with the IRS this year to offer that service. How do I get a passport or visa which walks you through from what types of forms do I need to fill out to where is the post office that I can pick this thing up. These have started to become very popular. Our government services site is growing 100 percent a month. We saw 13 million page views last month, which means that 13 million sets of eyeballs are seeing government information that didn't have on-demand access to that information even 6 months ago. Consumers have come to expect a lot from government. They want renewing the driver's license in Virginia or paying their taxes to be as easy as ordering a book from Amazon.com which has become very easy, and so that is where the bar is. And while there are some impressive examples in Federal Government, we feel and I know that many of the government agencies feel as well that information is still either too hard to find, too out of date or simply not available in a digital format. So I have three areas that I would just like to touch on by way of suggestion in the short to medium term. First of all, the notion that the Federal Government should try to be an AOL or a Yahoo, to create portals is I think valiant but may be very difficult. We believe that it is the role of government to create the applications on-line, to Web- enable paying your taxes, to Web-enable getting your passport or voting, but to try to create the consumer interface across many agencies is a very difficult job and there are specialists in this field, and AOL is not the only one but we have enough trouble hiring people to do this for us and we have stock options, as you said. So the examples that we have seen of this at the Federal Government level, the people involved in these projects are very up front about how difficult it is, No. 1, to make the portals work but also to drive traffic to them. This is what any dot-com will tell you; you can build it but they won't necessarily come. So where we have been able to help with government agencies is in driving traffic to the applications and we recommend a syndication model whereby all of the dot- coms will drive traffic to the Mint site, for instance, or the Social Security application forms. The second thing that I wanted to mention is the whole area that has been talked about already here, digital security authentication privacy. I am not an expert on the pending legislation on digital signature right now, but we do feel that it will go a long way to Web-enabling government. It is true that we really have been having to cobble together strategies in the absence of such legislation whereby digital signature means that you can bring a lot of the transactions, both financial and information on-line. What we can't stress enough is the importance that these applications, these digital signatures, the digital certificates be handled in a way that they are not an impediment to the consumer because it has been very difficult to look at different technologies across the board and try and make them interoperable. If I have to have one pin number to renew my driver's license in Virginia and another one for every other consumer transaction I want to conduct, that is going to be very difficult and I think an impediment to progress. Finally, I want to make one quick point about Members of Congress as well as agencies continuing on the drive to have public e-mail addresses. We find that consumers, their No. 1 desire is to be able to communicate with somebody at the other end and to the extent that we can empower through mail systems and good back office consumer-oriented service centers at the individual agencies and on Capitol Hill, that will go a long way to making feel that there is someone on the other end of not only the phone but of the e-mail. Thank you. [The prepared statement of Ms. deLaski follows:] [GRAPHIC] [TIFF OMITTED] T1535.059 [GRAPHIC] [TIFF OMITTED] T1535.060 Mr. Horn. Thank you. We will now start the Q and A, and I yield 10 minutes to Mr. Davis, the gentleman from Virginia, for questioning. Mr. Davis. Let me say that e-mail is the most frustrating part of the job. The e-mails are messed up half the time and sometimes they are a couple days late and we can't respond. Ms. deLaski. Yes, sir. Mr. Davis. It is all security related. We don't have it right now. Ms. deLaski. Right. Mr. Davis. During the impeachment I was getting 2,000 to 3,000 e-mails a day. People know how to find us; at least they can find us. I have a fundamental question. Mr. Molaski, we are dealing now with a government structure that is starting to change a little bit in the way that government is organized. My question would be do we really have a structure? You see what Virginia has done with the Secretary of Technology. Don, you had turf fights. Nobody wants to give up turf. They have created the Technology Committee, but it is turf fights who is going to have oversight and that means a lot in fundraising. How does it work having one oversight, and I get asked at the Federal level, should we have a chief information officer over all of the other chief information officers. What is the coordination? Mr. Upson. My response would be that it is a progress, the Federal Government is making progress but there is no time to go as slow as it has been going. I think you need two things in the structure. The individuals responsible for technology within an organization, within the departments should have power. They should be at least Assistant Secretary and the law exists to do that. You need a position to have authority within its own organization, and the collective authority reporting to not only the Federal Government but you have a Secretary of Technology, but maybe the Director of OMB, monthly meetings where the Interagency Management Council meets and at the President's direction are working. I think there has been a lot of talk. I think $36 billion is spent at the Federal level. NPR, the GITS committee, the Hammer awards, they are great things, but I often say they are like well-tuned instruments in a high school band playing different songs. You need power in the organization and power in a collective group, and I think that I would challenge you for the things that have been done. NPR has great goals. What were the big three accomplishments? And do the citizens know and what is the vision for electronic government, and I don't see that executive leadership coming. I think that Congress has built a foundation against which you can work. I think you could have assistant secretaries right now. I think you could make those assistant secretaries part of an Interagency Management Council reporting to an OMB Director, and I think you could reform procurement. You could take GSA and put it--what I think is interesting, Mr. Davis, you have got every agency of government putting out contract vehicles to sell computers not only with themselves but everybody else. NIH should be curing diseases, not selling computers. I think if you had an independent GSA along a Postal Service model, try to put together a structure that empowers and allows the professionals of the infrastructure to manage not only the infrastructure and build it, but to connect the bigger policy initiatives. Mr. Davis. We found in Y2K that you have some CIOs who have empowerment, and in Y2K we found there are some agencies who could walk the talk and there are others that didn't. It is frustrating. Mr. Upson. The biggest challenge to electronic government and the reason that it cannot work without that structure is that government agencies, like bureaucracies in the private sector, they behave as stovepipes and they want to do things their own way. As America Online said, everybody will have a digital signature environment and security environment which puts at risk all of the databases that we have in the government. Because--by the way, I would say that the interagency management council at the Federal level ought to include some State and local representatives, and maybe some from the private sector. Everything that we do connects to the Federal Government. People are not concerned about privacy per se. If they were, you wouldn't have $1 trillion in e-commerce. They are concerned about the government. We are the ones with police records, criminal records, the driving records, health records. Unless we have that standardized continuum across government, I don't see it working. I think that the structure is at the level that needs to be at the Federal level. Mr. Molaski. I believe that the structure has to be revamped within the Federal Government at this time. I think that the CIOs have made long strides since they were first implemented in 1996, and I think it is time that--as the Secretary has said, Secretary Upson, that they be given more power and authority over the information technology structures and operations within each one of their individual agencies. We have an organization called CIO council, which is an organization, an interagency body involving all of the CIOs within the Federal Government. Unfortunately, it has no teeth. Any recommendation that comes from it or that comes out of the CIO council is voluntary for the agencies. I would suggest that we follow similar cascading-down type of structures within the CIO community where it starts with the CIO council, and the council has power to be able to make some decisions, and especially as it is attuned to infrastructure. Then each one of the individual CIOs not only becomes an Assistant Secretary, but also has operations underneath them. Many of the CIOs are not responsible for the infrastructure within their own agencies. And for those departments like DOT that have multiple bureaus and multiple agencies, each one of those organizations needs the CIO to work with their administrator and work with the CIO to determine infrastructure and architecture. The one caveat I would make is that the program people still need the budgetary funds and the ability to direct what information technology they need to be able to perform their missions, and that decision should be made in concert with the CIO. For example, I would not want to be in a position where I make the decision on what flight traffic control systems the FAA should be using. However, I should be in a position to make sure that they are spending their dollars wisely in those areas, and they are following good business practices such as Clinger-Cohen. Mr. Davis. Do you want to comment on the structural issues, Mr. McClure? Well, fedcenter.com, and several others, those are commercial sites that are providing citizens and businesses with access to on-line government transactional services. Do you think that government should be concerned about these or should we be applauding these commercial efforts? Mr. Molaski. I definitely think that we should be applauding them. I think that part of the beauty of the Internet is the multiple access sites that we have to the government. I think what government has to follow is some of the subscription models, like Kathleen was saying, that we need to be able to prepare our sites and index our sites and have our sites available for the rest of the Internet universe to be able to utilize. Also, we should be investing Federal Government dollars where industries are not, and that really works when we start looking at a help desk. Portals are great providing that information is connected to the Web sites, but if I am a frustrated citizen and can't find that information in three clicks or don't know how to use a computer, where do I go? And that is, where we need a multi-access help desk to be able to provide the services to the stakeholders so that they can get that information. Mr. Davis. We have two issues. One is where you are providing for the occasional citizen, but the other is companies who are dealing with government in terms of purchasing goods off the Internet, how is the government doing those endeavors? Mr. Cooper. It is a significant challenge to interact with the government in a common standard way. There are several initiatives, the electronic procurement system and GSA, other initiatives that have helped. The portals that have been made available for understanding the services available or the procurement activities where opportunities that are available to Unisys and other members of the commercial establishment. The key is the infrastructure and the standardization of the infrastructure so that we can communicate in a common way to a common set of databases and a common methodology. And that is where we are greatly missing the boat at this point. We are in the early stages of the second wave, as we call it in our testimony that was provided to the committee, where you have the brick-and-mortar companies coming together with the dot- coms, those who put the pure Internet, such as AOL and the ability for those two to come together into a blending and work with the government to provide that full integrated capability is going to be the key to the future. Mr. Davis. My time is up. I would note one thing. We had one level of government that knew the love bug was a problem and by 4 a.m., they ferreted it out, but it was 11 a.m. before it got to other agencies. We still have problems within government because of the way that we are structured in terms of getting that information out. The more we hear from you all and hear anecdotes helps. Mr. Upson. We have a structure, and I think we are building a stakeholder. That love bug is a good example. We notify the providers and we used our management mechanisms in Y2K and across council to set up contacts at every agency, shut down the servers within State government and literally had no-- people did not communicate until we were able to put the patches on our servers, but we had a reporting mechanism across and government and we had a response, and we patched it and 24 hours we were up and running. Mr. Davis. Thank you. I have to leave, but I am pleased to be able to join you here today, and I would like to say to all panelists, we appreciate you for coming here and Mr. Chairman, thank you for holding this hearing. Mr. Horn. I am glad to do it. This is a Virginia unlike what I came to in 1958. This is terrific to have all of you here. I just want to ask a few questions. The one that is the question that I ask frankly to anybody I can see on the street, as well as experts, and that is, how do we measure Federal programs that are a success. We had a hearing of this committee about 3 years ago in Oregon, which is the only State in the union with a guide for measuring the programs to see if they are working, to see if the people are satisfied, and I would really like to hear from you, just going down the line. What do you think we can do to get the Federal Government out, and obviously they have done at the local level also, your excellence in government and that type of thing. But I would be interested in what your thoughts are. Mr. McClure? I am sure that GAO has piles of studies on it. How do we get agencies to say let's use the computer to have people assess these programs? On the other hand, you have got a whole group of people that you leave out when you do that. Do you take a random position that most pollsters would do or how do you do it? Do you say we did it this way and here are the data and here is what we are doing on this side on the noncomputer side. I think the help desk is certainly a good idea to get all of these systems that you use and you can use very constructively to have people look at the agency. Mr. McClure. Well, Mr. Chairman, the value coming from investments and technology is always a challenging area. It requires a combination of quantitative and qualitative information. One of the things that you'll see good companies, public or private, focusing on when they are investing in technology solutions are metrics that focus on speed, cost and quality. If you can show how you are improving those kinds of operational metrics in your organization in investments in technology, you can show that you are having an impact. There are other measures that are more soft, such as enhanced customer satisfaction, that are just as revealing and important to show that you are moving your business, your operations and your program outcomes in the right direction. In our advice to agencies that are struggling in the Federal Government with measurement issues, we argue that there is a real need to focus on both quantitative hard ROI-type numbers and qualitative data that can come from surveys and interactions with customers to know that you are producing good results, and I think that is where the heart of the matter lies. Mr. Horn. Any thoughts, Mr. Molaski? Mr. Molaski. Fortunately, when I was appointed 11 months ago, I joined an agency which was leading the government as far as performance measures, and that is the Department of Transportation, and they have been noted for their strategic plan and performance measures and their performance report this past year. That said, it is an evolving process that we have to get better at. We need to be able to have a dashboard for each agency not too unlike your grading system in Y2K that indicates what the agencies are doing as far as around their primary goals. For example, in the Department of Transportation, one of our goals is north star safety. We need and have been reporting internally to each other as far as how are we doing on that. We need to be able to simplify that to a great extent, to be able to come up with an index of some sort that we can work with and show Congress and show the public exactly the good work that we are doing. Mr. Horn. Are there other Federal agencies, say the 24 or so other agencies and departments, are they doing some of this program analysis work? Mr. Molaski. I really can't comment on other agencies outside of DOT because---- Mr. Horn. At the CIO level, do they ever discuss some of these possibilities? Mr. Molaski. We are looking at--one of our committees right now is on the security situation. We are more focused on technology as opposed to program relevancy. Our security committee right now is coming up with a security maturity model, and what that means is that we come up with a model that agencies can actually take a look at and where they fit within the maturity model on security so they have some ideas, and so that the administrators have some ideas of where they fit within the spectrum. Mr. Horn. Mr. Upson, in your role as Secretary, does the Governor say how do we look at some of these agencies I inherited? And have you used that to some degree and if so, how have you used it? Mr. Upson. Not so much in your question in terms of measurement, but actually, we took, and I meant to commend you, and I think I did in my written testimony, in the approach that this--that your subcommittee took with Y2K. What you asked fundamentally: What do the agencies do and what is important? We have changed a little of that. We now have a blueprint for what we think is most important. We use that as a blueprint for managing our technology now. But the most important thing to measure when you measure performance with technology investments, it seems to us, is that you be able to have a system that is accountable. What is it you do and how do you use technology to create an accountable system, and by that, let me give you two examples: One, there is a building permit process that has the builders in northern Virginia being up in arms. They are required to submit a hard copy, very thick application to agencies. Fairfax County, the Secretary of Transportation and Secretary of Natural Resources, they never know who has it. They never know how long it is going to take. They hire lawyers to manage it. It is never about the technology, it is always about the management. We put the stakeholders in the room, myself and two of my colleagues, and we are designing a system in real time that when you send that application in, it will be registered. You will know who has it and how long it is. The same thing with driver's licenses. There is a 90-some-odd percent Virginia approval rating of people who have been to RD&V in terms of their experience. Why? Yes, you can renew it on-line, but that is not good enough today. It is our database, we have the data. We know who is qualified. We send you the PIN number and you just simply put in your driver number and your PIN number and you don't type in name and address, at some point it all pops up. If you wait until the last minute, when you get to the transaction page and press click, the police are automatically notified that your driver's license is renewed and that receipt is a driver's license. That is a system of accountability and allows for measurement. Both of those instances are taking real priorities that we established through Y2K. It was the first time we actually have agencies that told us that they didn't have any priorities. Deal with that in the budget process. But I think the tools are there to make the technology more accountable, and I think one opportunity that the Federal Government has is to build on the discipline system that I honestly think the Government Reform Committee put in place, because government has defined what it does agency by agency. It is a great blueprint to work against and judge your technology investment against. Mr. Horn. Another thing I tried 3 or 4 years ago with my Transportation and Infrastructure Committee membership, we had testimony from the California EPA that they had turned over to the people on behalf of whom you had to file those reports how you can computerize that, and it worked. Somewhat like you are saying. Let them figure out the codes and all of the rest of it that you have to go through, and the result is that they saved a lot of trees for one thing, and they didn't have these reports where you couldn't find it, and you couldn't find what part you wanted because they were sitting somewhere in a warehouse in the paper world. So I asked EPA, which was also testifying at the time, can you do that. Oh, yes, I think we could. Well, they haven't done a darn thing yet, and yet California has this thing moving. This was under Governor Wilson years ago. These are the kinds of things that innovative States do, and we are sort of behind the cities of America and some of the counties of America at the State level and the Federal Government is behind all of you. So we are trying to stimulate the interest there. Any thoughts, Ms. McGinnis? Ms. McGinnis. Yes, I think measurement is very important. In terms of e-government, we can measure the transactions completed. We know that a lot of people visit government sites, but very few transactions are actually completed at this point. Service is delivered. Satisfactory two-way communications. You can measure customer satisfaction, whether the customers are citizens or businesses or universities, in terms of the quality and the timeliness of the transaction. You can measure cost savings in the long run and I think return on investment. Particularly for investments in the short run, access can be measured. We know a lot about how many people who are on-line. There are a lot of projections about that in the future. Knowing that in terms of specific categories of people who access government services would be very helpful, and then the security and privacy measures are also important, and some audits, so that we understand how government is doing on those dimensions. So I think there are a lot of measures, and for e-government, those are measures of how e-government is doing, but for each agency the most important measures are their mission-oriented measures like the Department of Transportation and how it is doing on safety. And I think the e-government networks will contribute to that. But the most important measures are the results. Mr. Horn. Mr. Cooper, any thoughts on how you measure programs? Mr. Cooper. It is obviously very important to conduct measurements of Federal programs and the Federal service to the citizen. We believe that the most important measure is the value that the government provides to its customers or constituents. Value, we believe a customer constituent is looking for, is how effectively does the government operate as a business? Does it operate like a business that we are all used to interfacing with, and will we pay our money for that service? Along that line, important metrics are needed for maybe three areas: One, customers or citizen satisfaction, supplier satisfaction and employee satisfaction. We put all of those under the first category of satisfaction. And what is happening in the commercial industry is that customer relationship management systems and tools and procedures are being built and being implemented for managing the customer or the constituent, and there are a few initiatives within the Federal Government where CRM is being implemented. So looking for the measurement of customer satisfaction is extremely critical. The second one is what we call service level agreements, and that is where you look at technical performance of the system or solution. The Federal Government is, in many ways, on a performance-base contracting, which I know that you have supported in the past, and the government is doing a good job of implementing service level agreements, and I think we are well on our way to establishing what a service level agreement is for an infrastructure or a computer system. The third, of course, is the financial metrics. We still have to work on what are those financial metrics, and what will be the acceptable level of the financial metric, again, in customer satisfaction and technical performance. Two more real quick points, in order to achieve either of these metrics, it is going to require integrative business processes, and that is where we have the difficulty, the stovepipes, that Secretary Upson mentioned earlier. We need to standardize the processes and the tools, the methods which are going to drive the demand for the common infrastructure, the standard networking, the standard access, access to data, data warehousing, data mining, which, again, is going to drive the need for Web enabling some of the legacy systems. We can't throw away all of the legacy systems that we have today and replace them with new whiz bang systems that may or may not be tailored to meet the unique needs of the Federal Government. So it is going to be very critical to look at the business processes and determine which processes can be implemented through Web enabling at the existing legacy systems and which ones will have to be removed and replaced. Mr. Horn. Well, I am sure that Unisys has a lot of experience with the private sector, and you are sowing a lot of these systems. As I remember, when I was a little kid in the thirties, the Standard Oil Co. of California had a separate organizational group that reported essentially to the chairman of the board, and that was a group on organization which took a careful look constantly were we doing the right thing, what are we achieving and so forth, and helping other people. One of the things that I am going to be putting in in the next month is the Office of Management Proposal which is to separate out from under OMB. When Nixon did that, I thought he was right on track because he could use the budget to get their attention in some of the cabinet departments and agencies. It didn't work out that way. I remember they had very--when I was in the Eisenhower administration, they had very fine people in OMB who were professionals and not political hacks, and they were people who knew what they were doing, they had served Roosevelt and Truman and Eisenhower, at which point it went downhill because they started to politicize Democrats like Kennedy, Johnson, or Nixon, and they started putting their own people, and you lost a lot of that professional approach, how you draw up government organizations. These are people that had drawn up the TVA, the Tennessee Valley Authority, and they put together a lot of government operations. They wrote the Marshall Plan. It wasn't the State Department, it was this unit. And so the question is where are these people? They aren't around too much now. This is what we have to build if the President is going to have choice and options. Sure, he needs somebody that can worry about the budget, but they are different skills when you are worrying about the management style. I am trying to split them off. Mr. Cooper. One comment, please, you mentioned Unisys's experience, and I would just like to remind you of the history, and we can provide more for the record, if you would like. Unisys came from Sperry and Burroughs in the 1980's, and when Burroughs and Sperry were formed, there were 51 data centers around the world. Today, there is one data center in Egan, MN serving 36,000 employees. Over 22,000 of those employees have access to Unisys broadcast television, so it is a push of the information and technology out to those employees in over 100 countries. Nearly all of the 36,000 have access to the same standard e-mail system. We all have one EHR system. Every employee has access to his personnel records all over the world. One system is achievable, it is a little more difficult when we have the situations that we have over many years of management, as you've indicated, missions and responsibilities that has been placed in the various agencies. We need to get started trying to work them together and across agency service to the citizen initiative would be very important. Mr. Horn. Ms. DeLaski. Ms. DeLaski. Two quick points. One, some agencies seem to judge their success by the number of hits to their Web sites. It is how many tax returns are filed on-line, not how many hits came to your Web sites. So that is one point. The other is just a cursory service which we are offering in government guide which might be of interest to your committee, your subcommittee, is that we are offering the opportunity for visitors to each of these government sites to rate the government site when they go there because we have put a button at the top of each government site which says, rate this government site, and up pops the screen that says was the information helpful? Was this worth my tax dollars? And we have ratings for 2,200 Federal sites now which we would be happy to share, and we share with agencies as well. Mr. Horn. Yes, that sounds very interesting. Does it really change at the other end when they read that material? Is anybody doing something about it? Ms. DeLaski. The agencies have asked us for the information. I imagine it is being used more for the purposes of flag waving when they get a good rating than the other way around. Mr. Horn. Well, we heard the building offices and the local governmental jurisdiction. That is one of the key things if you are trying to get economic development in an area where you can get access, because time is money and it is taking all of the time, and we had this in California and I can't say that we really have done much about it. I think what you are doing in Virginia makes a lot of sense and to be a model to tie in these things so that people who want decisions made can get them made. I don't know how you found that working in other parts of Virginia or in other parts of the United States. Mr. Upson. The key too, Mr. Chairman, is I think it is working in Virginia because we are bringing the stakeholders to the game, and I think it is about the structure. On the other hand, I would like to--and it is about the whole supply chain that I think Y2K showed us. It is not just about what you do at the Federal level, but State and local government. I would like to put out one other example where the government can do something. Part of Governor Gilmore's executive order is going to call for the uniform project management system of all projects over X value. We have a management structure so we are in a position to do that, but the Federal Government is spending $36 billion a year, and the statistics, I don't know what they are now, but 2 years ago, 16 percent of all IT systems projects were successful on time within budget. 84 percent weren't. I think the reason they weren't is that there is no accountability. People change requirements. We are putting in place not only a uniform project management system but a reporting requirement monthly. Every project in that category, everyone enters data the same way, and it comes to me and our council on technology services. Every 3 months it goes to the Governor and key members of the funding committees of the legislature. I believe that even the minute parties, both the public and private sector, managers know that there is accountability in the system, and the costs will go down. Every 1 percent savings is $360 million. We are trying to build incentives. I think those are things that can be done as well. But it does get back to one of the focuses of your hearing, and that is the structure, and for me, everything revolves around that. Mr. Horn. I thought your suggestion was very interesting and ought to be acted on is to get the States' representatives of counties and cities in that CIO council, because this is a partnership deal, and part of our problems in Y2K, even Social Security said oh, my heavens, we have our partnerships with the States and we haven't looked at them. They have done a great job on their situation and they scurried around and brought the States in. But that is the kind of thing that we need, where these partnerships are, we need to be working together with the States, and I happen to be a big fan of revenue sharing, and I hope that we get back to that one of these days. You know what we should be doing with the money, and, of course, the other party and the lobbyists just hate it because they can lose all of their power and all of their money. So it lasted at least for 10 years, and regretfully, in the Reagan administration they stopped it, and that was a mistake. Mr. Molaski. Mr. Chairman, I would be remiss in not commenting on working with States that the CIO council is very much in favor of that, and in fact, has developed a relationship with organization of all of the State CIOs and had a joint meeting with them this past June, this past December, when we had our first government conference. We think that is one of the things once we get our act together. Mr. Horn. On that very point in getting your act together, do you find some of your colleagues who have CIOs, do they have access to the Deputy Secretary or Secretary? Where are they? We are going to be looking at that. I am just curious. Mr. Molaski. They are all over the place. Some are political appointments with confirmations. Most of them are career SESs at the present time. It is not so much the access to the Secretary that really impinges--whether the CIO can perform the functions. It is really do they have the authority to impact the budgetary dollars, and even more so, I think it has been proven again and again, take control of the infrastructure which is broken out between many departments as Secretary Upson was saying here, and bring it together into one single type of activity. I think that has been proven at NASA where they went from spending $400 million a year to $100 million a year on their telecommunications costs, and most recently the Treasury, where they are looking at saving $400 million a year. Mr. Horn. To what do you attribute that? The location of the individual that could make these decisions? Mr. Molaski. Right. And in NASA, it was somewhat the lack of complexity and the drive of the organization to get a common infrastructure. And I think we will see more and more agencies doing that. Mr. Horn. That has been brought up with the CIO council so they can spread the word? Mr. Molaski. Absolutely. Again, the CIOs in my opinion want to do a good job and are engaged in doing a good job, but really don't have the authority or the funding to be able to really implement those changes in Web time that we are talking about. We have to bring a lot of consensus together and spend a lot of time building coalitions that in industry is handled more efficiently. Mr. Horn. Any other suggestions on measurement or hierarchy? I don't see any, so I will finish up with a few questions here. The benefits of the electronic government are numerous, and there are risks, and, of course, we talked about the love bug and the virus struck an estimated 45 million computers in 20 countries causing $8 billion in damages is the current estimate, and as we move toward greater reliance on the Internet to conduct business and provide services, how can we ensure the seamless operations in light of such devastating attacks? You had a good assistant who shut down the servers. Go ahead. Mr. Upson. That is true. Again it goes back to we are dependent, and the Internet and Web-enabled anything is going to do nothing but keep coming at us, and the question is how do we manage both risk and security. Having in place a system that can get the information shut down and the servers put the corrections in, and communicate with the agencies and the enterprise, and that really is the challenge. I don't think that we will turn back the clock, and what we did in Y2K pales on what we are going to do in data security and infrastructure security. Mr. Horn. One of the things that we want to look at, and we would like your advice, obviously, all of you, and that is, the degree to which we should look at a system in agency or department where they have certain types of things you go through to try to prevent that happening, and to try to block it off or divert it or whatever you want to say. Do we have some good examples of that in the private sector or in some level of government, because as the Secretary says, we have a real problem on our hands. They are going to be bombarding us all of the time. It is not just the 17-year-olds, it is foreign governments that want to look at things which lead to economic wealth or deficits. Ms. DeLaski. We would be happy to link you up with those folks who are experts and have that conversation. I am not an expert on that. What we want to stress is whenever there is a problem, we can put up in red letters on America Online which reaches 40 million people, we can put up something that says alert, do this or don't do this, so we can work with the government agencies, but we often have trouble knowing who is the lead in what message needs to go out to consumers. So to the extent that we can identify who those folks are, we would be very happy to act as a public service address system for those kinds of things. Mr. Horn. Fascinating. When GAO goes around and looks at these models, and what is the high risk and what is the low risk, and you do a great job on that. We have asked the Controller General to put a team ongoing through all Federal employers, all Federal computer people in terms of both the software and the hardware. And to what degree does Congress and the OMB face up to new equipment, which should make Mr. Cooper happy. In other words, we are a few generations behind if we are still playing with COBOL in the Department of Defense. Mr. Cooper. We have not been successful in bringing in a commercial solution. So the customer and the field believes he is getting access to a very modern system, but it is the old COBOL code behind the Web-enabled application. Mr. Horn. That is fascinating. Mr. Cooper. It is part of a solution. Mr. Horn. Maybe we better learn COBOL again. Mr. Molaski. It is not an official administration position, but I think one of the things that we are going to have to take a very hard look at in government is that as the United States becomes more and more dependent on electronic commerce, I think, likewise, our expenditures at the Federal Government level need to start being far more reaching as far as the security effort goes. Right now it is somewhat of a decentralized effort with GSA playing part of the role. Something happens at the DOD or CIA or NSA. Somehow we have got to be able to bring those activities together so that we can get ahead of the curve, if that is possible at all. Because it is going to have such a devastating economic impact, actually, if something like this would occur that would be attacking our national security. Mr. Horn. That is a good point. Mr. Cooper, to what degree is Unisys and other firms, IBM, and all of the rest, looking at this, how we can create blockages and not have the viruses get through the network right now? Mr. Cooper. At Unisys Corp., we have set up a management structure at the corporate level and policies procedures, looking for tools, methods. And then we have acted upon those at the local level, such as, in this case, the U.S. Federal Government. We have chosen the best tools that are available today. Norton Utilities is a good example. There are some modern virus, antivirus software that we are using, but I would like to bring in the fact that being a global corporation, we have to look at what is going on around the world and what we find in many parts of the world. Even in South America, they are ahead of us in various aspects of information security. Part of the reason is that they don't have the Privacy Act requirements that we have here in the United States, and recently, in working on a procurement for the General Services Administration called GSA Smartcard, when we went looking for capabilities around the company to respond to that program, we found most of the experience coming out of Venezuela, Portugal, Canada, Brazil, places that you wouldn't anticipate. There is a lot going on in the world. We need to continue to work it at the corporate level, both from a management structure and the technology investments, and with commercial off-the-shelf tools to build a corporate-wide strategy that gets implemented at the local level. Mr. Horn. That's interesting. We need to look south of the border. Mr. Cooper. And north. Mr. Horn. Are there statutory impediments that you are aware of to make effective, more effective the e-government initiatives? What are the statutory gaps that need to be filled in terms of the Federal Government? And are there other statutes that are giving you a pain that you would like to change? Presumably, Clinger-Cohen was designed to help people, not the opposite. I don't know what the experience has been. We ask, but sometimes we don't hear an answer. Mr. McClure. Mr. Chairman, I think there is actually a great body of law already in place driving e-government. I think we have an analysis of these statutes that showed that a lot of what is going on in electronic transactions and on-line services is driven both by authorizing legislation that pertains to individual departments and agencies. We find provisions bearing in law that require agencies to do X, Y, and Z by a certain date. We have general management improvements status such as Clinger-Cohen and the CFO Act, which require agencies to move aggressively toward greater use of information technology, and particularly through the Government Paperwork and Elimination Act on-line transactions. I think there is a very robust framework in place right now that is moving government in this direction. There is also lots of Presidential directives of trying to accelerate the attention and pace of government agencies to the issues. Again, I think there is a very, very robust framework. As far as overlapping and duplication, I don't know if our analysis really dug down that far, but I don't think that you can say that there is a lack of attention for this from certainly both the executive and the legislative branch. Mr. Horn. Has the GAO, in their studies of this, how much government do we really want to put on-line, and what is the ultimate goal? Is there any thinking in GAO when you go around and talk to the people in the executive branch? Mr. McClure. There are certainly questions that we want to ask agencies, not necessarily questioning about what they put on-line, but how they have gone about making decisions on what are the requirements that they want to put on-line. One of the challenges that we see at government agencies is oftentimes they try to do too much without enough capability or skill or attention to get results in a few areas. So some of the problems are simply taking priorities, moving aggressively in certain areas, getting a good track record, and showing success and moving on, and I think that is a real challenge for many of the agencies, particularly when you look at the scope of what they are being asked to do by some of the deadlines that are now being imposed. Mr. Horn. Mr. Molaski. Mr. Molaski. I think a couple of things, Mr. Chairman. No. 1 is that if we are going to allow and use the CIO positions within government to be the change agent within government, we have to place the accountability authority and responsibility in that position as we have been talking about. I think probably the most critical function for that that we really need to look at is manpower functions. We are not getting the young blood. The average age of DOT employees in the civil work force is 43.7. Over 50 percent of the technology workers in IRS are over 50. We are not getting challenged from the bottom. We are not connecting with a whole generation, and we need to bring this new generation into government and make government relevant in their lives and get their perspective on the way that the government has to move. And again, I would highly recommend that we go into government service in return for paying for their education or forgiving student loans-type of scenario, which would bring and cause this to happen. The last thing is that we have a tremendous opportunity that is going to be facing us here as we start rolling out e- government and moving forward. Currently, we are stovepiped within the executive branch. Congress is also stovepiped and there is no overarching committee that is looking at e- government and across government. We need to put some processes in place so when these opportunities for streamlining and for consolidation present themselves, that we have a workable process in place to be able to attack them and give the stakeholders and the citizens what they deserve. Mr. Horn. You have eloquently stated the problem, and we will steal all of your words, but we will attribute them to you, but we don't pay any royalties. You are right on the mark on that, and that is one of the euphorias, as a Californian, I have been trying to upset the community college people and Silicon Valley, where I had a hearing a few weeks ago and say look, why can't you people get together. We have to bring all of these people from abroad. These are $60,000 jobs, and the community colleges were designed in California starting back in 1910, 1917, and the whole purpose which you can never achieve in a State agency is you just don't have the money, so you are going to train and educate people. You need to have the people that make the equipment, hardware, software, whatever, and working with the teaching profession so you have a decent curriculum that makes sense to people. And the military are usually very good at teaching, and that is where we try to work. The community colleges need to be working together, and it needs to be continuous. Chico had audio and television going all over that area in the seventies and eighties, and we had a statewide nursing education program. I am trying to think now whether it was the Johnson Foundation--one of them gave us $2 million to get this rolling. Nobody ever had a chance to get an education before, and that is the kind of thing that we need to have, the industry working with community colleges and people in the agencies, and I would think that we have got to start in kindergarten. So we have just got to get together and do it, and if we have every one of us at this table be a--the private sector that sells, computing, teachers, and consumers, we have to do that and focus on and keep at it. You have put yourself on the mark on that one. The problem is how do we get it done? Ms. McGinnis. The e-government initiative that we have underway involving a lot of the companies represented here and others in government is looking specifically at the barriers to e-government and computer statutory barriers, so we will give you the very specific analysis of that when we have it. I think they will fall in the categories of personnel issues. That is a big one in terms of recruiting, training, development, developing; and we are hopeful that you might take a look at information technology as a special case, think about the changes that are necessary in computing practices, pay, and all sorts of things, and then learn from that to look at the civil service system as a whole. The other barriers I think will come in the way money flows, and that gets to the point that George Molaski made about the way the executive branch is stovepiped, and Congress, in terms of the appropriations committees and how the money flows. It flows in such a way that it doesn't allow the integration, integrated investments and funding for technology, and we may want to look at something like a working capital fund, we may want to look at some possibilities, such as sharing savings, to provide some incentives for savings down the road. So there will be very specific, both barriers and recommendations, that will be offered by fall, and hopefully that will fit within your timeframe. Mr. Horn. We certainly welcome it. I can tell you one thing, and I have seen it work any number of places, it took me 5 years to get our trustees in the California State University system to collapse all of the civil service positions that were anywhere near management, if we are going to actually get something done, get rid of them. And we got down to four basic things. It went from 10,000 to 100,000. The President could set the amount anywhere on that scale and we wouldn't have personnel directors which drove me nuts for 30 years. They were not created in the Federal Government when I was Assistant to the Secretary of Labor. He said Steve, you go across the hall and talk to them. This was a guy who was Secretary and the top personnel person in the country, he couldn't stand Federal personnel directors. It was always like that. It is like Groucho Marx, what is the magic word? If you don't get it, you don't get the raise. Nonsense. So what you do is put a contract on that manager. What are you going to do in 6 months, where are your goals? If something happens, great. If it doesn't happen, you put the squeeze on them and you move the money around. Overnight things started to happen. People said gee, they really care about how we do things, and that will work again, but you have to fight personnel people. So I don't know what degree we have made any progress in the Federal Government. That is not my bailiwick, so I stay out of it right now. That is the problem. We do need to reward the purchasing people that are being stolen off. That I do want to see happen. Also, we need to get rid of a lot of political appointees and have professionals. I tried that one in 1975. Some people said we might be in some time. That is crazy. You want good professionals who make a lifetime of it. Mr. Cooper. I would like to add one comment to the discussion on the community college and the hiring of personnel with 2-year associate degrees, or even nondegree. The private sector that is doing business with the Federal Government believes very strongly that Congressman Davis' bill that requires the Federal Government to enter into contracting practices to require opportunities in those labor categories without--for performance without degrees to be passed. That is an important piece of legislation for us. Mr. Horn. We carried that through the House the other day. Bill Gates couldn't have qualified. Mr. Cooper. It is extremely important because there is a large group of personnel coming out of the community colleges, and more importantly maybe is the people who are leaving the military service that have 4, 8, all of the way up to 20 years experience and no degree, and we can't place them on a Federal contract. That is nonsense. Mr. Horn. Absolutely. So right there are a few statutory things that we need to work out and not wait until election night. Let's get this show on the road. Any other thoughts on this? Do you have any last questions, counsel? He thinks that we have not gone far enough. Secretary Upson mentioned the digital opportunities program being developed by Virginia as a way to ensure access to the electronic government for all citizens. What initiatives are underway at the Federal level to ensure electronic government for all citizens without regard to education, geographically or disability? Anything beyond the statutory initiatives that have been managed earlier? It is a real problem. Income, little kids have laptops at 4, not every family can afford that. So are we going to have a digital operation where you have people that are really impoverished, and they might be able to make the transition to buy a small laptop. The question is, what do they know about it? That is one of the things that we have to do. Money talks. When you say $60,000 down the line, I think you might get a lot more people there than we have in the past. That is what is needed. Mr. Upson. Mr. Chairman, one of the points on this goals to personnel issues, maybe just an observation, it is going to be very difficult for the government to hire qualified people as long as the technology people are over here and policy people are over here which, in many ways, is the issue today. As long as that is the case, medicine will be a different speech than health care. I think one of the things, the power at the Federal level, is we use State government not to build a network, but to bring together our technology experts and our business leaders, and we use the power in the Federal Government, both its buying power and expertise in technology, to bring together the communications companies, for example. I know President Clinton was in North Carolina talking about in 3 years he has an agreement to provide high bandwidth communications in rural parts of North Carolina. We did that last December, and were rolling out the omniband, high bandwidth communications network for any business in Virginia based on using the power of government to bring the companies together, and all of the enterprises are paying the same price so people in northern Virginia are paying the same as people in counties which are in far southwestern Virginia. It is without those building blocks, without those building blocks, rural America and nobody else is going to participate. We are going to have a divide where we have opportunity. It goes back to that point about networks. Canals, networks and superhighways all have prosperity. This network can be everywhere and government--I think some of the technology people in government with executive leadership and coordination are in the best position to bring about an infrastructure that will give all of our citizens opportunity, I think, for generations. That is a different model. Mr. Horn. Well, I sure empathize with you about rural. I happened to grow up on a ranch, and in college we all found out that a lot of us had grown up on farms. We knew how hard it was to work on a farm, and going to college would get us off that place. Mr. Cooper. Mr. Chairman. Mr. Horn. Mr. Cooper. Mr. Cooper. I cannot pass up the opportunity to say something about the part of the country that I come from and the difficulty that we have in this area. Just across the State line in Tennessee, the hills of Tennessee and it is atrocious the situation that we are in. We also, here in the Washington area, we often make jokes about the Federal Government moving to West Virginia. There are government contracts, there are opportunities for moving some of the performance of the Federal business to these parts of the country. Being the oldest of 12, the rest of them are still in the hills, they need the training. It is not just the people of our age, it is the teachers in the public schools who do not--who are not computer literate. They don't have the schools wired and they don't know how to train the kids. If you look at the industry, whether it be Saturn moving to Tennessee, there are many industries who are moving industry to those parts of the country and are doing a good job. The Federal Government has not done its share. Mr. Horn. You know, in the Eisenhower administration when I asked the personnel director where we were getting our supply of clerical people, they were full-time living in West Virginia. That got people out of the classrooms to get them up here to get an education. That was helping West Virginia before Senator Byrd. You are right about some places do get favored more than others. Mr. McClure. We do have a request in from Congress to look at that very issue--what are the factors that are influencing relocation of data centers and virtual service providers, customer centers in other parts of the country. In today's environment, they don't necessarily have to be located in the urban centers. So we have a dialog with some of the members of our executive council who come from the private sector to look at what some of those factors are that could be influencing the relocation of some of the power of the Internet via some of the call centers and the customer relation centers that you see in the private sector. We would be happy to share that with you when we get it done. Mr. Horn. I would be glad to see it. When President Eisenhower was in office, he wanted to decentralize the government in case of bombs, and this was during the cold war, or anything else that were dropped in Washington, he wanted the government moved out of range, at least piece by piece. He wanted it 50 miles, 100 miles, so some things did get moved, which was good. Mr. Molaski. Back to the digital divide, Mr. Chairman, I think that some of the transportation companies are showing us, such as Ford Motor Co., has given all of its employees access to the Internet and a computer. American Airlines has also. The chairman said his payback and his cost to the organization was less than a year. I think it is very difficult for us in government to keep on talking about e-government when some of our employees in government don't have access to the Internet. If we want them to think about it in their jobs, how they can use the Internet to be able to perform better services, they need to be on it and playing with it. Likewise, we need to encourage industries to continue the model that these fine organizations have started. Mr. Horn. You are absolutely right on that. This rejuvenates a number of areas, and we have to keep going on that. We have had a lot of things, in fact, sometimes the grade is wrong. We had a lot of problems with the--I think it was Columbus, OH Army processing center on contracts. They had GS- 1s there. I thought that they went out with the Civil War. That is why they were spewing out contracts for people who didn't have any orders. That was rather amusing. But they needed to up the level, and that is what we had to do. The military is terrific in that. If you want to get a Ph.D., join the Army. They will send you to Harvard or Princeton or Long Beach. We need that constant upgrading and giving people a chance. I happen to have a small subsidiary of a German firm in my district, and 8 years ago when I was campaigning for the first time, I went through there, and if a person logged 1,000 hours on the computer, the firm would give it to him. He could take it home or whatever. They taught them computing and those people have a career now. But it took good management to have the idea and get people involved and excited about it. Any other last questions or thoughts you have? If not, I thank each of you for coming. We deeply appreciate the work of everyone who worked to put this hearing together. We have the staff, and I thank J. Russell George, staff director and chief counsel; Randy Kaplan, counsel; Bonnie Heald, director of communications; and Bryan Sisk, clerk; Liz Seong and Michael Soon, interns; and minority staff, Trey Henderson, counsel; and Jean Gosa, minority clerk; and the staff from Representative Davis' office, Melissa Wojciak and Barbara Tempel, and the court reporter is Doreen Dotzler. [Whereupon, at 3:10 p.m., the subcommittee was adjourned.]