Title: Department of Commerce Author: Vice President Al Gore's National Performance Review Date: September, 1993 ********************** Department of Commerce ********************** Accompanying Report of the National Performance Review Office of the Vice President Washington, DC September 1993 ******** Contents ******** Executive Summary 1 Recommendations and Actions ^^^^^^^^^^^^^^^^^^^^^^^^^^^ DOC01: Reinvent Federal Economic and Regional Development Efforts 5 DOC02: Provide Better Coordination to Refocus and Leverage Federal Export Promotion 11 DOC03: Reform the Federal Export Control System for Commercial Goods 17 DOC04: Strengthen the Tourism Policy Council 23 DOC05: Create Public-Private Competition for the NOAA Fleet 27 DOC06: Improve Marine Fisheries Management 31 DOC07: Provide EDA Public Works Loan Guarantees for Infrastructure Assistance 35 DOC08: Establish a Manufacturing Technology Data Bank 37 DOC09: Expand Electronic Availability of Census Data 41 DOC10: Amend the Omnibus Trade and Competitiveness Act to Increase the Data Quality of the National Trade Data Bank 45 DOC11: Eliminate Legislative Barriers to the Exchange of Business Data Among Federal Statistical Agencies 49 DOC12: Establish a Single Civilian Operational Environmental Polar Satellite Program 53 DOC13: Use Sampling to Minimize the Cost of the Decennial Census 57 DOC14: Build a Business and Economic Information Node for the Information Highway 61 DOC15: Increase Access to Capital for Minority Businesses 63 Agency Reinvention Activities 65 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Summary of Fiscal Impact 71 Appendix ^^^^^^^^ Accompanying Reports of the National Performance Review 77 ***************** Executive Summary ***************** The Commerce Department celebrates its 80th birthday as a cabinet- level department in 1993. During its 80-year history, the department has grown to employ more than 36,000 people in 13 major operating units with a fiscal year 1993 budget of approximately $3 billion. Despite this growth, the Commerce Department still remains the smallest cabinet-level department in terms of budget. The department is, in some respects, a holding company composed of vastly different agencies, each pursuing disparate missions. The department's 13 operating units have five primary missions: increasing business and trade promotion; improving the nation's technological competitiveness; fostering environmental stewardship; improving economic development; and compiling, analyzing and disseminating vital national statistical information. The National Performance Review (NPR) analysis of the Department of Commerce's Economic Development Administration and other economic development programs from other agencies revealed that community and regional development efforts are characterized by fragmentation, poor quality, and bureaucratization. To overcome these shortcomings, NPR recommends that the President create a Federal Coordinating Council for Economic Development (FCCED). FCCED would consist of the affected cabinet officers and would be responsible for developing a government-wide strategic plan and unified budget for carrying out federal economic and regional development programs. The export of U.S. goods and services overseas helps to create jobs at home and ensures that American businesses remain competitive in the global marketplace. The NPR recommends that the Trade Promotion Coordinating Committee be given broader authority to create performance measures for use in evaluating and funding the approximately 150 federal export promotion programs, and begin a pilot program to integrate the domestic field offices of federal agencies that provide export counseling and finance services. Also, the NPR recommends that the Foreign Service Officers Corps be leveraged to increase the Foreign Commercial Service, making it more competitive with the commercial services of other industrialized nations. U.S. businesses continue to lose potential export opportunities due to a cumbersome and outdated export licensing policy. The NPR recommends that the review, decision and dispute resolution system for export licensing be reformed to decrease jurisdic-tional disputes between the agencies involved in this policy area. If implemented, this change could help generate billions in new exports, create thousands of new jobs annually and help ensure U.S. competitiveness. Commerce must break the decade-long deadlock on the role and responsibility of the National Oceanic and Atmospheric Administration's (NOAA) fleet. The NPR recommends an experiment with a program of public/private sector competition.The NPR also recommends that the department work with Congress and the fishing industry to rebuild marine fisheries and improve economic health of the nation's publicly owned and privately used continental shelf fishery resources. Timely and effective dissemination of critical trade, economic, and statistical information to other government agencies and the private sector is another area in which Commerce must take a government-wide lead. The NPR recommends that the Secretary support the expansion of the contents of the National Trade Data Bank and develop an active marketing campaign to explain its value to American exporters. Com- merce should also establish a Manufacturing Technology Data Bank to disseminate critical, precompetitive, government-funded technology data to U.S. businesses. Opportunities exist to dramatically reduce the reporting burden placed on American businesses by federal statistical agencies. Commerce, in consultation with these other federal agencies, should institute widespread electronic data gathering from U.S. businesses, eliminate duplicative requests, and begin shifting reporting schedules to be more in line with common business practices. Implementing these recommendations can save business owners tens of millions of dollars. The NPR recommends that NOAA, the National Aeronautics and Space Administration, and the Department of Defense establish a single, coordinated polar satellite program, as opposed to the current plan for three systems. The NPR recognizes that access to credit for minority businesses is a persistent national problem and recommends that the Department of Commerce, in cooperation with the Small Business Administration, increase its efforts to expand credit access for minority small business. The NPR also recommends that Commerce work with the Office of Management and Budget and the Justice Department to remove the current prohibition on the use of sampling in decennial censuses to determine the apportionment of Congress. Significant savings will be achieved in the 2000 decennial if this restriction is removed. Commerce has begun an internal reinvention program. This effort is strongly supported by Secretary Brown. The internal Commerce effort consists of four main phases. First is the idea-generation process. So far, nearly 8,000 reinvention ideas have been received from Commerce employees. Shortly after the idea-generation process, five cross-cutting programmatic teams were formed to develop recommendations in trade, economic stimulus, environmental services and research, information, and technology. The third source of new ideas is a series of focus group meetings in which nearly 300 managers and employees have participated. Commerce's fourth reinvention phase is the establishment of five reinvention laboratories. Many additional recommendations are being evaluated by Commerce's internal review. The overall savings and revenues from these recommendations are estimated at $675 million over the five-year period fiscal year 1995 through 1999. *************************** Recommendations and Actions *************************** ************************************* DOC01: Reinvent Federal Economic and Regional Development Efforts ************************************* Background ********** At least seven federal programs assist states and localities with economic and regional development.(1) The major programs are the Department of Commerce's Economic Development Administration, the Department of Agriculture's Rural Development Administration and Rural Electrification Administration and the Department of Housing and Urban Development's Community Development Block Grant Program. Smaller development programs are operated by the Department of Defense, the Tennessee Valley Authority, and the Appalachian Regional Commission. These economic and regional development efforts are characterized by fragmentation, poor quality, and excessive bureaucracy. In the absence of a coordinated system that integrates assistance, states and communities must turn to an assortment of different agencies and programs. This dispersion of effort makes it difficult for communities to obtain assistance, limits the development of critical knowledge, hinders organization, and limits funding for national efforts. Moreover, many federal programs are poorly run, with communities facing significant delays in receiving assistance. Finally, there is no coherent federal policy concerning regional development and community dislocation. Piecemeal, after-the-fact responses are the norm. Department of Commerce ********************** The Economic Development Agency (EDA) was established in 1965 to aid economically distressed regions; it soon became the "flagship" federal agency for regional economic development. EDA principally funds local public works projects (such as industrial parks, access roads, and sewer lines), to enable communities to attract industry from other areas. The agency also provides grants to communities facing sudden economic distress and funds technical assistance and economic research. Funding rose until the early 1980s, when the Reagan and Bush administrations tried to eliminate the program. The program's current budget is $254 million for fiscal 1994, down from $830 million in 1980 (in 1992 dollars). Significant changes in the economic development environment during the 1980s suggest that EDA's economic development role (as well as that of other federal programs) needs to be fundamentally rethought. First, states and localities now have significantly greater economic development capabilities than they did when EDA was established . As a result, EDA's "retail" approach to economic development, with its 49 field offices, six regional offices, and 150-person national office, now duplicates many state and local efforts. Moreover, the creation or expansion of state and other federal programs means that EDA is no longer the flagship agency for regional economic development in the U.S. Second, EDA's traditional approach to economic development (which focuses on public works and other infrastructure development) has not shifted sufficiently to focus on newer efforts such as technology centers, entrepreneurial development, and manufacturing modernization.(2) This is in part because EDA funds are divided into several titles, the largest being Title 1 for public works and infrastructure. Finally, EDA's uncertain political support has contributed to a variety of problems, including reduced morale, lower staff quality, poor operation and administration of programs, lengthy and complicated grant approval procedures, and the pursuit of low-risk policies. Grant applications must go through four levels of review: an informal review at the Economic Development Representative field level, a formal review at the regional level, and two final reviews at the national office.(3) As a result, the EDA approval process is slower than it should be. Department of Agriculture ************************* The Department of Agriculture (USDA)'s Rural Development Agency (RDA), a recently reconfigured agency formed by the consolidation of several existing USDA programs, was created to aid in the development of rural communities. RDA's programs can be divided into three categories: Water and Waste Disposal, Business and Industry, and Community Facilities. RDA provides technical assistance and funding through grants and loans. Water and Waste Disposal funds are available to public entities such as municipalities, counties, special purpose districts, Indian tribes, and non-profit corporations. Funding includes support for technical assistance and training grants. RDA provides business and industry assistance through loan guarantees and loans distributed through intermediaries, such as state and local government and nonprofit organizations. Loan guarantees are designed to bolster the local private credit market. Indirect RDA loans are supposed to go to business facilities and community development. Community Facilities funds are for the purpose of improving essential services in rural areas. Eligibility is the same as for Waste Disposal. As stated, RDA makes grants, direct loans, indirect loans (through cities, states, and nonprofits), and also guarantees loans. In fiscal year 1994, out of a total budget appropriation of $913 million, RDA received budget authority of $264 million for loan levels of $1.85 billion. The money for direct loans, usually 30-year, long-term loans, is borrowed from the Treasury Department. Indirect loans, provided through state and local government, are paid back to RDA by the state and local governments themselves. Guarantees are also provided to commercial banks and work similarly to guaranteed student loans. Many of RDA's programs provide emergency assistance for events such as tropical storms, earthquakes, or flooding. The Federal Emergency Management Agency is best equipped to handle these functions. The Rural Electrification Administration (REA) was created under the New Deal as part of a general program of unemployment relief, with the goal of providing electricity service to the countryside. REA has continued to provide financing for the provision of electric service; in 1950, it began to provide financing for telephone service as well. In addition, in 1989 REA initiated the Rural Economic Development Program, which provides loans for job creation in rural areas. The Clinton administration has already proposed virtually eliminating REA's low-interest loan program for electric cooperatives and telephone companies, which would save an estimated $374 million over four years. Department of Housing and Urban Development ******************************************* The Department of Housing and Urban Development (HUD) administers the Community Development Block Grant Program (CDBG). CDBG is broken up into entitlement and non-entitlement sections. Both programs have the primary objective of developing viable communities by providing decent housing and expanding economic opportunities, principally for low- and moderate-income persons. Seventy percent of CDBG appropriations are direct entitlements to large metropolitan cities and urban counties. Non-entitlement spending, otherwise known as the Small Cities Program, is slightly less than 30 percent of CDBG appropriations and is appropriated to states who then make grants to small local governments to carry out development activities. Other Federal Programs ********************** The Department of Defense's Office of Economic Adjustment (OEA) assists communities in planning for defense conversion. However, because federal support for the implementation of these plans comes from different agencies, particularly EDA, it is difficult to develop coordinated defense conversion strategies. The Tennessee Valley Authority (TVA) is responsible for the maintenance and management of a broad array of public lands, physical facilities and natural resources. In addition, it directly supports economic development through business assistance, economic planning, education, environmental planning, agriculture assistance, tourism promotion, and minority business development. The Appalachian Regional Commission (ARC) is a federal-state government agency concerned with the economic, physical, and social development of the 13-state Appalachian region. ARC's comprehensive goals are to improve the health and job skills of the people of Appalachia. ARC concentrates on community and industrial development as well as housing, education, health, and tourism. Both TVA and ARC were created at a time when state capacities were limited. However, state capacities are much greater now. The nation no longer needs area-specific development commissions. The federal government no longer effectively guides and supports regional development. For example, the proliferation of federal programs supporting economic development makes it difficult for states and localities to obtain assistance easily. Knowing where to look and how to apply can be challenging for the most knowledgeable state or local government official. When governments need assistance in more than one area (e.g., defense conversion, rural development, or business assistance), the maze becomes even more complex. Federal economic and regional development programs do not operate as one-stop shops. This makes it difficult for the federal government to focus its resources on pressing problems such as defense conversion, for which a number of agencies provide help. In addition, the lack of innovation and consistency in federal policy has contributed to the ineffectiveness of many state and local economic development programs. For example, much of the money states now spend on economic and regional development is for "zero-sum" industrial recruitment activities. Individual states may benefit from industrial recruitment activities, but when one state wins another loses. No net benefit accrues to the nation as a whole because business investment is not increasing; it is simply being shifted among regions. Moreover, much of this money subsidizes foreign firms that have already decided to locate branch plants in the United States. For example, states and cities gave more than $1 billion to foreign automobile firms between 1978 and 1992.(4) Federal policy has not changed to meet modern economic realities; instead it has persisted in a fragmented, programmatic approach to development. These actions have hindered, rather than fostered, a consistent and integrated federal, state, and local effort toward regional development. Regional economic distress must be a federal priority if the nation is to manage economic structural change effectively. At least two reasons underlie this need. First, an uneven national pattern of regional growth and decline is inefficient and costly. In some places, resources sit idle and under-used, while others suffer from the negative effects of growth, such as congestion and high costs. This less-than-optimal use of public and private resources reduces the efficiency not only of declining communities, but of the U.S . economy as a whole. Second, community economic decline imposes social, psychological, and physical distress on area residents. Caught in a downward spiral, communities may find it impossible to regain former levels of prosperity unless they receive economic assistance. Federal support can help these communities and regions stem further decline and build a solid base for recovery. Although state and local government efforts have made significant strides in addressing local economic concerns, they are not an adequate replacement for a strong federal presence, particularly given today's economic realities of increased international competition and rapid changes in technology. The U.S. government should revitalize its commitment to regional economic development in a manner that guides and supports state and local efforts to achieve the best possible practices and results. Action ****** The President should create a Federal Coordinating Council for Economic Development (FCCED). The FCCED would consist of the cabinet officers or directors of the affected agencies (i.e., Department of Commerce, Department of Agriculture, Department of Housing and Urban Development, Appalachian Regional Commission, and the Tennessee Valley Authority) or their representatives. The FCCED would provide a unifying framework to coordinate the economic and regional development activities of the U.S. government, and to develop a governmentwide strategic plan and unified budget for carrying out federal economic and regional development programs. The FCCED would: --- Coordinate federal economic development policies and programs; --- Provide a central source of information for states and localities on federal economic development programs; --- Coordinate official economic development efforts to ensure better delivery of these services to the public; --- Prevent unnecessary duplication in federal economic and regional development activities; --- Assess the appropriate levels and allocation of resources among agencies in support of economic and regional development and provide recommendations to the President based on its assessment; and --- Carry out such other duties as are deemed to be consistent with the purposes of the FCCED. Implications ************ The federal government currently possesses a broad menu of economic and regional development programs but is not adequately organized or coordinated to meet the needs of the states and local communities. This recommendation would help ensure that the needs of states and local communities would be better met and that, ultimately, more jobs would be created. Further, a stronger and more effective federal- state relationship on economic development issues would be established. Fiscal Impact ************* This recommendation is budget neutral; however, the coordination of the delivery of economic and regional development services and a clearer delineation of agency roles should produce savings. Endnotes ******** 1. These are distinct from other programs designed to help states and localities with issues such as law enforcement, education, and social services. This brief also distinguishes between programs focused on economic and regional development and those focused on urban revitalization. The former are focused on distressed regions and areas suffering from long-term economic decline or economic dis locations. The latter programs focus on the redevelopment of blighted or distressed urbanized areas and neighborhoods that may be located even in reasonably health metropolitan regions. 2. U.S. Congress, Office of Technology Assessment (OTA), After the Cold War: Living With Lower Defense Spending, OTA-ITE-524 (Washington, D .C., February 1992), p. 175. 3. In 1989, EDA's 360 staff members manage 820 projects, an average of 2.2 projects per person. 4. See OTA. ********************************************** DOC02: Provide Better Coordination to Refocus and Leverage Federal Export Promotion ********************************************** Background ********** Unlike most of our economic competitors, the United States does not possess an export strategy or an export infrastructure capable of assisting U.S. businesses interested in pursuing global opportunities.(1) Export programs are fragmented among 19 federal agencies, 10 of which possess substantial export promotion budgets. The Departments of Agriculture, Commerce, State, Energy, and Interior; the Agency for International Development; the Export-Import Bank; the National Aeronautics and Space Administration; the Overseas Private Investment Corporation; the Small Business Administration; and the U.S. Trade and Development Agency all play major roles. Partially as a result of this fragmentation, the U.S. continues to lag far behind other industrialized nations in exports as a percent of Gross Domestic Product.(2) The export of U.S. manufactured goods helps U.S. industries remain competitive in the global marketplace and create jobs at home. The Department of Commerce estimates that every additional billion dollars of U.S. exports creates 20,000 new jobs. In fact, most of the growth of the U.S. economy over the past few years is directly attributable to exports, as is almost all growth in America's high- wage manufacturing sectors.(3) Today, 14 million U.S. jobs are supported through exports.(4) Unfortunately, despite the vast number of manufacturing companies that could compete in the global marketplace, only 2 percent of U.S. businesses account for 85 percent of U.S. exports.(5) These companies are primarily large U.S. multinational corporations that have the resources to compete internationally. Census Bureau figures show that the top 10,000 exporters are responsible for 96 percent of U.S. exports, while the other 94,000 corporations account for the rest .(6) Even among the top exporters, only 5,000 U.S. companies have annual export sales of more than $5 million.(7) Most shipments, 72 per- cent, are worth less than $20,000.(8) Thousands of small and medium-sized manufacturing firms recognize that their products are internationally competitive, but due to high transaction costs and sometimes a lack of information, they are unable to tap into new markets. In this context the United States has been referred to as the "world's biggest export underachiever." (9) In an effort to rectify this problem, the government operates more than 150 programs designed to assist American businesses sell their manufactured goods overseas. So far, this effort has not been successful for a number of reasons. Historically, the United States has focused federal export program dollars on the promotion of agricultural products. In 1982, the U.S. exported more than $36 billion worth of agricultural goods, which represented 17 percent of all U.S. exports.(10) By 1992, after another decade in which the federal government poured billions more into agricultural export programs, U.S. agricultural exports had actually decreased to 10 percent of total U.S. exports, while the share of machinery and other manufactured goods exported showed a steady increase.(11) Commerce Department figures indicate that of the 7.2 million jobs supported by exports in 1990, 46 percent were in the manufacturing sector, while 8 percent were in the agricultural sector.(12) Yet in 1991, the General Accounting Office (GAO) reported that, although agricultural products accounted for only a small percentage of overall U.S. exports, the Department of Agriculture continued to receive approximately 70 percent of the $2.7 billion federal export promotion budget.(13) This disparity has had a detrimental effect on other federal export promotion programs. Compared to the Japanese and most of our major European trading partners, the U.S. spends the least on helping its businesses compete internationally. For every billion dollars of manufactured goods exported overseas, the U.S. spent 59 cents, while France spent $1.99 and Italy spent $1.71 per billion.(14) In terms of human resources devoted to assisting U.S. business with trade lead information, advocacy, and other assistance overseas, the U.S. record is also poor. The U.S. and Foreign Commercial Service (US&FCS), part of the Department of Commerce's International Trade Administration (ITA), is the leading government agency devoted to helping U.S. businesses promote themselves internationally. Despite presences in 70 nations and 47 district offices in the United States, the US&FCS has been continually criticized for not doing enough to promote U.S. business interests. Critics of the US&FCS argue that it should be abolished because federal employees do not adequately understand the needs of business people. Others maintain that, with only 200 US&FCS officers spread throughout the world--an average of less than two people per post--the US&FCS has never had a chance to be effective. In comparison, the Japanese, through the Japan Export Trading Organization (JETRO), field more than 150 trade experts in the United States. The U.S. currently has 15 US&FCS officers and 44 Foreign Service Nationals stationed in Japan.(15) The federal government's inability to provide for a stronger overseas presence has created a leadership vacuum that state governments are attempting to fill. State trade offices overseas have proliferated. The National Association of State Development Agencies (NASDA) reports that in 1990, state governments spent more than $90 million annually on international economic activities, more than four times what they had spent in 1984.(16) About one-third of these funds, $33 million, was spent to support 163 state-run foreign office locations.(17) Even more disconcerting than the total number is the fact that only nine of these state offices were located in cities without a US&FCS office, and that at least seven offices were partially funded by private donations.(18) Although these state offices were initially created to attract foreign investment, today they devote an average of only 30 percent of their time to that task. In an attempt to fill the void created by inadequate federal support and leadership, the states have continued to attempt to bolster their domestic industries by creating programs to duplicate what the US&FCS was mandated to do. Duplication of effort is endemic, not only in the relationship between the states and the US&FCS, but also among other domestic federal export promotion programs. Currently, three agencies share primary responsibility for delivering export counseling and finance services. The Export-Import Bank is responsible for helping businesses finance their exports; the Small Business Administration (SBA) helps small businesses assess their exporting capabilities and provides financing assistance; and the Department of Commerce, through the domestic offices of the US&FCS, provides small and medium-sized U.S. businesses with counseling, trade mission, and trade lead information. According to critics, trade finance services, especially financial advice and information, are not disseminated efficiently because the Export-Import Bank has a small staff and is not able to market its services. At the same time, the SBA, with its huge domestic network of field offices, has not made the Export Revolving Line of Credit a priority.(19) Export counseling, primarily the responsibility of the regional and district offices of the US&FCS, is in some cases duplicated by SBA's field structure and local state economic development agencies.(20) Essentially, each of these agencies attempts to service overlapping segments of the same group of customers instead of presenting a coordinated effort. The duplication and fragmentation found within the entire federal export bureaucracy is mirrored within the Commerce Department itself. Commerce should strive to ensure that its own ITA does as much as possible to promote the sale of manufactured goods. A business that contacts the Department of Commerce directly may become lost within the maze of ITA subdivisions. Composed of the US&FCS, International Economic Policy (IEP), Trade Development (TD), and Import Administration bureaus, ITA's mission is to promote U.S. industrial exports. According to a recent Commerce Department Inspector General's report, ITA's organizational structure encourages overlap.(21) It allows each division to help promote exports, diffusing responsibility for this task and leading to mission confusion among ITA employees, "turf" battles between divisions, and confusion among customers. Anecdotal evidence also suggests that the country desk officers and analysts within IEP who focus on specific countries, are out of necessity also becoming industry experts--the role of TD analysts--because of the lack of communication among the divisions. In an attempt to solve the problems of federal export promotion program duplication and resource allocation, the Trade Promotion Coordinating Committee (TPCC) was created by executive order in 1990. Its mandate was to define areas of overlap and streamline federal export promotion activities. The Bush Administration did very little with the TPCC. By 1992, it became clear that the TPCC needed more power to fulfill its mandate, and the committee received additional statutory authority under the Export Enhancement Act of 1992 . The TPCC will present a report to Congress on September 30, 1993, outlining a national strategy for export promotion, proposing ideas for eliminating program duplication, and developing a unified budget for export promotion activities. Proponents of the TPCC believe that it will become an effective vehicle to enhance and coordinate the fragmented federal export promotion effort. In sum, the federal government is not using its resources in an efficient manner to meet the needs of small and medium-sized businesses interested in exporting their products overseas. The lack of federal coordination and leadership has led to duplicated efforts between federal agencies and state governments and has caused confusion among customers. Although export promotion programs cannot by themselves alter the U.S. trade imbalance, which is influenced by macroeconomic and financial policies, the federal government can provide businesses with technical and representational assistance as well as export financing. If small and medium-sized U.S. businesses are to compete in the global marketplace, the federal government must begin to reallocate its resources to sectors that have clearly shown growth potential while it works to make its services more accessible to its clients. Actions ******* 1. The President should issue an Executive Order to grant the TPCC broader authority to control federal export promotion efforts. The TPCC should be given additional authority to create performance measurements and goals and to use them for program evaluation across all federal export promotion programs. This structure would give the TPCC the power to move beyond its current role of coordinator and become a stronger mechanism for the Department of Commerce to facilitate interagency communication and cooperation. The TPCC should work closely with the National Economic Council (NEC), which would oversee the resource reallocation process for federal export promotion resources to be incorporated into the Office of Management and Budget's (OMB) annual budget process. The NEC would use TPCC's program evaluation results to oversee the creation and implementation of unified export promotion budget. 2. The TPCC should establish a pilot program to physically integrate the domestic field offices of federal agencies that provide export counseling and finance services. In 12 U.S. cities, Department of Commerce US&FCS district officials are located in the same building with Small Business Administration loan officers. Integrating these international trade counselors with financial experts will eliminate the need for prospective U .S. exporters to visit multiple government offices to get the information they need. This pilot program should last for at least one year, after which time a report should be prepared for the Secretary of Commerce (as chair of the TPCC) outlining the program's effectiveness. This proposal to create "one-stop shops" is consistent with the strategic vision currently being developed by the TPCC. That vision provides for a new, more focused domestic Commerce Department program as part of a consistent national approach in which, over time, the federal government will shift from providing export services directly to the client to providing the means and support to state and local governments, as well as the private sector, to do the same. This will help to facilitate a better public-private partnership. 3. A Recruiting Program should be established through the TPCC to increase the Foreign Commercial Service Officer Corps. Compared to our major trading partners, the United States spends less and does less to assist new or potential exporters. To rectify this problem, Foreign Service officers from federal agencies whose missions have changed due to the end of the Cold War should be transferred or placed on long-term rotation to the overseas field posts of the US&FCS. This would not increase government costs. A recruiting program should be created to transfer or rotate competent Foreign Service officers who are interested in business promotion from the Agency for International Development, the U.S. Information Agency, and potentially the State Department. 4. The Department of Commerce should create regional and industry specific task forces within its ITA. ITA, currently composed of the US&FCS, International Economic Policy (IEP) and Trade Development (TD) divisions, operates under a matrix structure that attempts to leverage country, industry, and export promotion expertise. Trade Development focuses on industry analysis; International Economic Policy provides country-specific information to businesses; and US&FCS's mission is to lead the promotion of U.S. industry overseas. However, each division plays a part in ITA's overall trade promotion strategy. This kind of programmatic overlap has caused mission confusion within ITA. According to a recent Inspector General report and interviews conducted by the National Performance Review, the divisions are not working well together, and International Economic Policy country desk officers are becoming industry experts because of a lack of coordination between IEP and TD. ITA should create regionally or industry focused task forces that would bring country and industry analysts together to create a more synergistic and team-oriented environment within ITA. Implications ************ The federal government currently possesses a broad menu of export promotion and financing programs but is not organized or coordinated to meet the needs of U.S. businesses. These recommendations will help ensure that those needs are met, potentially increasing both the volume of U.S. exports and the number of U.S. exporters. This in turn will help create new jobs in the United States and, by changing the way the government delivers these services to the private sector, a more effective public-private partnership. Fiscal Impact ************* These recommendations are budget- neutral, but the creation of "one- stop shops," the coordination of export promotion service delivery, and the delineation of agency roles, should produce significant savings in terms of spending and personnel. According to a recent return-on-investment analysis study, which indicated that a US&FCS dollar spent on export promotion returns $2.88 to the Treasury in additional personal and corporate income tax revenues, the expected annual return would be $29 million.(22) Furthermore, enhanced U.S. exports resulting from these actions will have a positive effect on U.S. trade balances. Endnotes ******** 1. The Trade Promotion Coordinating Committee (TPCC) will present a report to Congress on September 30, 1993, that will outline a strategic plan and set of priorities for federal activities in support of U.S. exports. For further information on TPCC's purpose and duties, see the Export Enhancement Act of 1992, P.L. 102-429 (October 21, 1992). 2. See U.S. General Accounting Office, Export Promotion: A Comparison of Programs in Five Industrialized Nations, GGD-92-97 (Washington, D.C.: U.S. General Accounting Office [GAO], June 1992). 3. Garten, Jeffrey E., "Clinton's Emerging Trade Policy: Act One, Scene One," Foreign Affairs, vol. 72, no. 3 (Summer 1993), p. 183. 4. Ibid. 5. Stroh, Leslie, The Exporter: The Magazine for the Business of Exporting, vol. 13, issue 12 (March 1993), p. 2. (Editorial.) 6. "52 Percent of All U.S. Export Shipments are Valued at Less than $10,000, Contrary to Popular Belief that All Exports are Big Ticket," Trade Data Reports, Inc. (October 1, 1992). (Press release.) 7. Ibid. 8. Ibid. 9. Nothdurft, William, "It's Time the U.S. Got Serious About Exporting," The Northwest Report (St. Paul, MN: Northwest Area Foundation, undated), pp. 28-31. 10. U.S. Department of Commerce, Bureau of the Census, Statistical Abstract of the United States, 1992 (Washington, D.C.), p. 658. 11. Ibid., p. 746. 12. Davis, Lester A., U.S. Department of Commerce, Economics and Statistical Administration, Office of the Chief Economist, U.S. Jobs Supported by Merchandise Exports (Washington, D.C., April 1992), p. 21. 13. U.S. Congress, House, Committee on Government Operations, Subcommittee on Commerce, Consumer, and Monetary Affairs, "Export Promotion: U.S. Programs Lack Coherence," statement of Allan I. Mendelowitz, U.S. General Accounting Office, Washington, D.C., March 4, 1992, p. 2. 14. U.S. Congress, House, Committee on Government Operations, Subcommittee on Commerce, Consumer, and Monetary Affairs, "Export Promotion: U.S. Programs Lack Coherence," statement of Allan I. Mendelowitz, U.S. General Accounting Office, Washington, D.C., March 15, 1992, p. 15. 15. Telephone interview with U.S. Department of Commerce's Japan Export Information Center, July 1993. 16. Nothdurft, p. 90. 17. Ibid. 18. Telephone interview with Carol Conway, Executive Editor, Clearinghouse on State International Policies, Research Triangle Park, North Carolina, July 1993. 19. U.S. General Accounting Office, Export Promotion: Improving Small Businesses' Access to Federal Programs (Washington D.C.: GAO, April 28, 1993), pp. 10-11. 20. See U.S. Congress, Mendelowitz statement of March 15, 1992. 21. U.S. Department of Commerce, Office of the Inspector General, Assessment of Commerce's Efforts in Helping U.S. Firms Meet the Export Challenges of the 1990s (Washington, D.C., March 1993). 22. U.S. Department of Commerce figures. ***************************************** DOC03: Reform the Federal Export Control System for Commercial Goods ***************************************** Background ********** The current dual-use export control system used by the United States was created to protect national security by preventing technologically sensitive commercial goods from being used for military purposes by potential Soviet-bloc adversaries. In this regard, it is a relic of the Cold War and should be changed to reflect today's nonproliferation security challenges and to recognize the realities of competing in the global marketplace. Once an effective tool, the current system now hampers U.S. economic competitiveness and lacks the focus needed to ensure effective opposition to the proliferation of weapons of mass destruction. Established in 1949 at the Cold War's beginning, the Export Control Act sought to maintain the technological superiority of the United States and NATO allies over the Soviet Union and Eastern Bloc by denying them access to sophisticated commercial goods whose value- added technology could be used for military purposes.(1) To ensure that this strategy would be successful in stopping the flow of dual- use goods to Communist nations, the U.S. and NATO allies formed a multilateral control regime called COCOM (Coordinating Committee on Multilateral Export Controls) that sought to harmonize the international procedures and standards by which commercial and military items would be restricted. The late 1960s and 1970s saw a dramatic rise in the use of export controls to oppose human rights violations and terrorism and to help counter proliferation. By 1969, it had also become apparent that U.S. commercial competitiveness was being hampered by the export control process. The act was revised to decontrol commercial items readily available on the world market. This revision marked the first time the U.S. government officially recognized the necessity of balancing commercial and national security interests.(2) In response to the Soviet invasion of Afghanistan, the 1979 revision of the act reflected increased East-West tensions and sought to strengthen controls on the export of commercial goods and technologies in order to maintain strategic and economic advantages.(3) The early part of the 1980s saw little change in the international political system, and thus little change in U.S. export control policies. However, by the mid-1980s, more multilateral agreements were created to control the proliferation of chemical, biological, and nuclear weapons, as well as missile technology. The creation of these agreements kept military concerns at the forefront of the U.S. export control policy and helped to institutionalize jurisdictional conflicts between the State Department, responsible under the Arms Export Control Act for restricting the flow of munitions abroad, and the Commerce Department, responsible under the Export Administration Act for restricting dual-use commercial goods. The State Department, through the International Traffic in Arms Regulations (ITAR) which fall under the Arms Export Control Act, also regulates about $6 billion in commercial arms sales annually. Industry sources recently complained to the State Department that, because it has not revised the ITAR since 1985, too many commercial items are controlled by the Munitions List, which specifies items that are primarily military in nature.(4) In fact, anecdotal evidence indicates that, in some instances, an exporter has received an export license from the Commerce Department only to learn at the border that the product also falls under the jurisdiction of the Munitions List and requires a State Department license. Currently, no formal system exists to resolve these jurisdictional disputes. The changing international situation has not yet prompted the government to create a revised set of export control policies that accurately reflect current international political and economic realities, including the fact that our security interests are increasingly dependent on global economic competitiveness.(5) Experts in both the private and public sectors agree that the current system is still based on high-volume, Cold War-era export controls. Previously, less than 20 percent of all applications were referred to other agencies for review. Such referrals were due primarily to concerns that these dual-use goods might be diverted to the Soviet Union for military purposes. Today, with the break-up of the Soviet Union, concerns about the worldwide proliferation of weapons of mass destruction have increased. More than 50 percent of all commercial applications currently received by the Commerce Department's Bureau of Export Administration (BXA) are referred to other agencies due to end-user concerns and potential applicability to the construction of nuclear, chemical, and biological weapons and ballistic missiles.(6) As a result, export licensing processing times have doubled in the past two years. On average, referred cases require six times longer to process.(7) Such licenses are routinely delayed for three months and longer. One reason for these delays may be attributed to BXA's current organization and staffing patterns. BXA is equipped to meet Cold War- era needs and lacks certain technical skills and expertise that could help ensure speedy and accurate licensing decisions in the current exporting environment. At any rate, such delays can hurt companies' marketing strategies and create the impression that U.S. firms are unreliable suppliers. The current decentralized system, with its multiple licensing groups and unclear lines of authority, is baffling to many exporters. Industry sources have complained that export control regulations are confusing and that their responsibilities under new nonproliferation regulations require clarification. According to some estimates, up to 40 percent of all goods manufactured in the U.S. require a license before they can be exported.(8) The computer industry reports that 70 percent of all export licenses are for computer-related products.(9) Today, although millions of Americans owe their jobs to exports, the export control system has not been able to keep pace, causing the nation to lose sales, jobs, and tax revenue.(10) However, calculating the economic impact of such controls is difficult. Most studies do not include potential savings in defense spending due to continued U.S. technological advantages, or the costs of maintaining the present export control bureaucracy. Some industry groups believe that the U.S. loses up to $20 billion in sales annually because of these controls. According to industry estimates, this figure translates into as many as 400,000 potential U.S. jobs.(11) The current process has been described as "a maze." When a company applies for a commercial export license, the interagency decision- making and referral process can allow the license to languish. At least five cabinet departments, five interagency working groups, the intelligence community, a number of interagency escalation groups, the National Security and National Economic Councils, and ultimately even the President may take part in the process. While the current system provides a time limit for agency review (as outlined in National Security Directive 53) that generally has worked efficiently, delays still occur, especially in the cases of precedent-setting license applications or jurisdictional conflicts between the Commerce Department's dual-use Control List and the State Department's Munitions List. Anecdotal evidence indicates that delays for some industries have become so acute that a number of U.S. multinational corporations have lawfully circumvented U.S. controls by shipping products through other COCOM countries such as Canada, saving two to three months in shipping time. Another problem for business has been that of timely control-list review. The Commerce Department's control list is reviewed every year, which may not be fast enough for the computer industry's short product life-cycles. Although it is regarded as an exceptional case, the current definition of "super-computer" restricts U.S. sales of widely used and available work-station computers. Restricting sales of these computers by U.S. firms, in a $10 billion industry expected to double in volume by 1997, only harms the nation's industrial competitiveness and economic security.(12) Although the U.S. coordinates most controls with its allies within existing multilateral agreements, it sometimes imposes unilateral controls either for national security or foreign policy reasons. While unilateral policies and controls sometimes are appropriate, long-term unilateral controls place U.S. firms at a significant disadvantage if they are not adopted multilaterally.(13) At present, the government does not perform any type of cost-benefit analysis to determine the effect of unilateral controls on the domestic economy in general or on specific industries. While export controls are still an essential element of U.S. national security policy, today's licensing process for commercial goods is widely criticized as cumbersome, bureaucratic, and confusing. Citing such concerns, 28 members of Congress recently sent President Clinton a letter urging the administration to change the current export control process. Although progress has been made, a 1991 National Academy of Sciences study also stated that the U.S. has ". . . continued to drive the vehicle of export control policy while looking in the rearview mirror . . ." and is basing its policy on ". . . a set of assumptions about American economic, technical, and political influence that, while certainly true for the first two decades or so following the Second World War . . . simply no longer reflects prevailing global circumstances." (14) Clearly, the export control system must change to reflect current security priorities. Specifically, it should focus on non- proliferation concerns and balance this interest with U.S. economic priorities, by placing a high priority on the competitiveness of industries that contribute to U.S. national security. A new export control system should establish clear lines of accountability to resolve interagency disputes in a timely and effective manner. It also should clearly define agency roles and jurisdictions concerning control lists, and incorporate timely reviews of control lists. Lastly, while unilateral controls will always remain a valid foreign policy option, they should be imposed only under narrowly defined conditions. Actions ******* 1. The President should direct that the decision and dispute resolution system for export licensing applications be overhauled. This revision should provide clear accountability for the efficient functioning and management of the export licensing system. The Commerce and State Departments should work to streamline their internal licensing procedures and maintain responsibility for chairing the licensing committees and dispute resolution mechanisms under their purview. Processing times for dual-use licenses that have not been referred to other agencies should be completed within nine days. Processing times for more complicated applications requiring referrals should be reduced at least 25 percent, from 120 days to 90 days. Other agencies involved in the referral process (e.g. the Departments of State, Defense, and Energy) should be allowed no more than 20 days to review any pending license before being required to transfer the license to an interagency dispute resolution group for a decision.(15) Moreover, to help forge a better public-private partnership, each agency should designate a senior official as the principal contact person for exporters or other interested parties who wish to raise concerns about export control issues. 2. The President should direct the Secretaries of Commerce and State and the Assistants to the President for National Security Affairs and Economic Policy to create an effective jurisdictional dispute resolution process to reduce confusion caused by the overlap between the State Department's Munitions List and the Commerce Department's Control List. As illustrated above, the licensing jurisdictions of the Departments of State and Commerce overlap in a number of areas. While progress has been made toward limiting these areas of overlap, licensing jurisdictional questions still cause considerable confusion for exporters. Shipments occasionally are halted by the U.S. Customs Service due to uncertainties concerning the correct agency licensing requirements. A timely and effective dispute resolution process should be created through the NEC/NSC that would help to rationalize the two systems. This process also should include a study of the feasibility of "one- stop shopping" for export licensing, designation of one agency as the entry-point for all license applications, consolidation of administrative functions, and creation of a uniform application form. 3. The President should direct that the control lists be examined to ensure that only the most sensitive items remain restricted. Further, controls should be implemented multilaterally whenever possible, and the NEC should conduct an assessment on unilateral controls. With the end of the Cold War, the existing export control list should be examined carefully to ensure that it reflects current security concerns. Controls on widely available goods such as work-station computers should be reviewed to ensure that continued controls serve modern security concerns. Because export controls can be effective only when they are imposed multilaterally by all supplier nations, unilateral controls should be avoided in all but the most pressing circumstances. Whenever unilateral controls are imposed, the NEC should be directed to conduct an economic assessment of their consequences to U.S. industries so that their full costs can be properly weighed. 4. The President should direct the appropriate Cabinet Secretaries to create an integrated database for dual-use and munitions export licenses. To improve interagency review and communications and the overall licensing process, agencies involved in export control should begin to upgrade and integrate their data systems. 5. The Commerce Department's Bureau of Export Administration (BXA) should adapt its operations to the changing nature of export controls. BXA should realign its programs to improve its credibility with customers by providing clear and concise regulations and timely export control information. BXA should also consolidate and increase its technical resources to ensure that all available expertise is brought to bear on critical nonproliferation export control issues. BXA should use its resources to train other nations, especially the newly independent states produced by the breakup of the U.S.S.R., in the complexities of dual-use export controls. Better use of resources in this area will help to preclude the proliferation of weapons of mass destruction through the supply of sensitive items from the former Soviet Union. Implications ************ Implementation of these recommendations would help to balance competing economic and military considerations and create clearer lines of responsibility and authority by decreasing jurisdictional disputes between agencies. In the long term, these changes also would help to foster a better partnership between government and industry and ensure that U.S. industries remain competitive in the global marketplace. Fiscal Impact ************* The full fiscal impact of these recommendations is difficult to estimate. The purpose of these improvements is to lessen inefficiencies within the federal export control system by rationalizing and streamlining the process and bringing disparate computer systems together. These changes should help U.S. companies become more competitive so that they can create new jobs at home. Endnotes ******** 1. U.S. Congress, House, Committee on Foreign Affairs, Subcommittee on Economic Policy, Trade and Environment, statement by Dr. John Steinbruner, "The Reauthorization of the Export Administration Act," June 23, 1993. 2. National Academy of Sciences, Finding Common Ground: U.S. Export Controls In A Changed Global Environment (Washington, D.C.: National Academy Press, 1991), p. 313. 3. Ibid., pp. 313-314. 4. The ITAR was republished in the Federal Register on July 22, 1993. Officials at the Commerce Department have indicated that the revised list continues to control many dual-use items. 5. See U.S. Congress. 6. U.S. Department of Commerce, Bureau of Export Administration figures. 7. Ibid. 8. See National Association of Manufacturers, "Export Control Questionnaire," Report to Members (July 17, 1992). 9. The Computer Systems Policy Project, Keeping Pace with Change (Washington D.C., June 4, 1993). 10. McNealy, Scott, "These Restrictions Do Not Compute," Wall Street Journal (June 16, 1993), p. A7. 11. U.S. Department of Commerce reports that every $1 billion of new exports generates approximately 20,000 jobs. 12. McNealy, p. A12. 13. National Academy of Sciences, p. 132. 14. Ibid., p. 319. 15. This time limit for review would ensure that pending license applications are moved through the process in a timely and efficient manner. The State Department would retain sole authority to designate items to be controlled under the U.S. Munitions List. Disputes over list jurisdiction would be resolved through the process to be created under Action 3 of this recommendation. ********************************************* DOC04: Strengthen the Tourism Policy Council ********************************************* Background ********** The impact of tourism on the U.S. economy should not be underestimated. Tourism ranks as the first, second, or third largest employer in 37 states; it is the largest employer in 13 states. In 1992, tourism was the second-largest employer in the U.S. as a whole. In the past decade, the travel industry created jobs at twice the average rate of all U.S. industries. The industry leads the nation in its employment of women and minorities. In 1992, domestic and international travelers spent $361 billion in the U.S. on air, bus, taxi, ship, and rail travel; hotel and motel accommodations; camping; food and drink; retail purchases; and amusement and recreation services. This amounted to an estimated 6 percent of the Gross National Product. In the same year, domestic and international travelers paid nearly $51 billion in U.S. taxes, compared to $32 billion in 1986. International tourism is particularly important to the U.S. balance of payments, resulting in a surplus of more than $20 billion in 1992 and supporting 5.9 million U.S. jobs. Prior to the 1960s, the government was largely uninvolved in the promotion of tourism to the United States. By the late 1960s, however, the impact of tourism on the balance of payments and its important contribution to economic development had become evident. Between 1949 to 1960, the U.S. travel deficit--the difference between the nation's payments on travel abroad and U.S. receipts from international visitors--nearly tripled, from $360 million to $1.2 billion. In 1961, the U.S. Travel Service, predecessor to today's U.S. Travel and Tourism Administration (USTTA), was created in response to the growing travel deficit. Today, this situation has reversed, and USTTA has become an aggressive promoter of U.S. tourism interests. However, the federal tourism promotion effort is fragmented. At present, more than 20 federal agencies possess tourism programs in addition to USTTA. Of these, 10 have significant responsibilities. The Agriculture Extension Service provides communities with information on tourism development opportunities, and is pilot- testing "Our Town," a computerized bulletin board of rural travel opportunities. The service also has a pilot project to increase tourism through training, capacity building, and implementation of a comprehensive tourism marketing plan to be developed by the New Mexico Cooperative Extension Service. The service recently developed instructional materials in the Polish language for use in Poland. It has also formed an ad hoc tourism committee. The U.S. Forest Service works with local, state, and regional tourism organizations to create jobs in national forests, working mostly through rural economic development efforts. A variety of other agency activities promote tourism directly. For example, the service recently dedicated $50,000 to support the Allegheny National Forest's membership in the Pennsylvania-Rhode Island Regional Market Development Program in Germany. Similar ventures are under way in Idaho and New Mexico. The Department of Education's College Work Study program provides a Port Receptionist Program that offers language assistance to international visitors at airport inspection areas. The Bureau of Indian Affairs is involved with multi-cultural and rural tourism and is also an ex officio member of the Rural Tourism Development Foundation Board of Directors. The Bureau of Land Management (BLM) manages nearly one-eighth of U.S. lands and also is host to 2 million visitors annually. BLM administers "Recreation 200," a recreation growth and development plan that includes Back Country Byways, Adventures in the Past and Watchable Wildlife. Primarily involving rural communities, BLM's tourism policy promotes relationships with local, state, national, and international tourism entities. The National Park Service operates a tourism program to offer technical assistance for the development of new tourism infrastructure and marketing planning. Service public relations efforts attempt to change park visitation patterns and holds tourism training conferences concerning public use of national parks. It also acts as a point of contact for public-private tourism organizations. The Federal Highway Administration (FHA) administers the interim National Scenic Byways Program, which seeks to increase tourism while preserving the natural environment. FHA also recognizes scenic qualities surrounding various highways, provides grants to states for project activities along existing state-designated scenic byways, and provides grants for other tourism-related activities. The agency has spent about $80 million over six years for Scenic Byways Program activities, including development of visitor centers and promotion. The Appalachian Regional Commission works to promote travel and tourism to the Appalachian area through promotional activities aimed at foreign and domestic travel professionals. The commission also provides grants for revolving loan funds as well as small grants for educational workshops, and produces various brochures. The Tennessee Valley Authority delivers technical assistance in the Tennessee Valley, and cooperates with other agencies in developing the Tennessee River for maximum economic development through tourism. It has also been a leader in rural tourism development. The proliferation of federal agencies involved in tourism development has caused great concern among state and local tourism officials. Problems cited include confusion regarding what agency to approach for which type of support, and duplicated, uncoordinated efforts at the state, local, and federal levels. The severe demands of the federal budget make it imperative that the U.S. maximize the impact of every dollar. Coordination of the fragmented federal approach to tourism development makes sense both in terms of maximizing the impact of federal spending and in avoiding duplication of products and services. In an effort to coordinate federal tourism efforts, the Tourism Policy Council (TPC) was created by statute in 1981 to coordinate federal policies, programs, and issues that relate to tourism, recreation, and the national heritage. The council also is responsible for developing areas of cooperative program activity, assisting in the resolution of interagency program and policy conflicts, and addressing the policy concerns of state and local governments and the private sector. The TPC, chaired by the Secretary of Commerce, includes the following members: the Under Secretary for Travel and Tourism; the Director of the Office of Management and Budget; a representative of the International Trade Administration, designated by the Secretary of Commerce; the Secretaries of Energy, State, Interior, Labor, Transportation, and Agriculture; the Chair of the Tennessee Valley Authority; the Chief, U.S. Army Corps of Engineers; the Administrator of the Small Business Administration; the Commissioner of the Immigration and Naturalization Service; the Chief Executive Officer of the National Railroad Passenger Corporation (Amtrak); and the Commissioner of Customs. The role of TPC in tourism policy coordination has steadily eroded over the years; at present, meetings generally are attended only by staff-level persons with little or no authority to speak for their agencies. This decline in TPC's effectiveness has occurred as independent activity by agencies has increased, and the future of tourism trade development becomes more and more significant to the nation's economic health. The council should be revitalized in a manner that allows for effective cooperation and integration of federal efforts in tourism development. This reinvention will allow the agency to achieve its potential and fulfill the vision set out for it in the 1981 statute and reconfirmed and expanded in the Tourism Policy and Export Promotion Act of 1992. Action ****** The President should broaden TPC's authority to coordinate federal tourism promotion efforts. TPC's expanded authority would empower the council to govern tourism development initiatives across federal departments. The Secretary of Commerce, as chair, should be empowered to conduct cross-cutting tourism program and budget reviews to facilitate integrated planning and implementation, and to propose means for improving such efforts through resource adjustments, integrated planning, a unified budget, or such other techniques as may be required. The council should develop a strategy maximizing government's impact on tourism exports. These new authorities would reverse the decline in TPC's role and would make it an effective mechanism to facilitate interagency communication and cooperation. TPC's efforts would be integrated with those of the Trade Promotion Coordinating Committee. TPC would work closely with the National Economic Council and with the Office of Management and Budget, particularly in relationship to development of a unified budget. TPC would prepare an annual report to the President with recommendations on coordinating programs and allocating resources. Implications ************ The fragmented federal approach to assist the development of the U.S. tourism industry has created duplication and overlap. These recommendations would help to ensure that government spending is being directed within a strategic framework resulting in a decrease in duplication, better federal communication and coordination, and a more rational expenditure of scarce federal resources. Fiscal Impact ************* These recommendations are budget-neutral, but their impact should result both in increased tourism "export" earnings and increased tourism in areas that are currently unpopular and in greater need of economic development. Improved coordination and integrated planning should result in a net increase in federal funds directed to tourism promotion and, more importantly, more effective expenditure of funds. ************************************************************ DOC05: Create Public-Private Competition for the NOAA Fleet ************************************************************ Background ********** The National Oceanic and Atmospheric Administration (NOAA) maintains a fleet of ships to support its mission of oceanographic and atmospheric research, assessment of living marine resources, and nautical charting and mapping. With an average age of about 28 years, the fleet is reaching the end of its projected life expectancy. The life expectancy of a vessel that has received a major midlife rehabilitation is 30 years. However, only six of 20 NOAA vessels have had even partial midlife rehabilitation. NOAA's ability to accomplish its responsibilities is in jeopardy unless immediate action is taken. A recent internal NOAA study proposes that a minimum of 5,000 days- at-sea (DAS) per year are required to accomplish its mission.(1) The current NOAA fleet provides less than 3,600 DAS per year. This is only 84 percent of the average annual number of DAS provided over the past 15 years. The study also proposes a fleet replacement and modernization plan that would cost in excess of $1.6 billion over the next 15 years, in addition to its current funding level. Many evaluations of NOAA's fleet requirements have been conducted since 1986, including reports by the General Accounting Office (GAO), the Department of Commerce Inspector General (IG), and the Oceanic and Atmospheric Management Advisory Committee (OAMAC).(2) The OAMAC evaluation seriously questioned NOAA's proposed ship-type requirements, fleet size and mix of government-owned/operated, contractor-owned/government-operated, and contractor-owned/operated vessels. The evaluation also suggested that an independent review would be useful in determining ship requirements and that NOAA's proposed contracting effort be increased to a minimum of one year. This would be necessary to generate significant private interest. Currently, contractors provide a very small amount of NOAA's charting and research functions. The Corps of Engineers contracts 30 to 40 percent of its charting, which suggests that the private sector has the ability and interest to do this kind of work. Historically, substantial savings result when competition is introduced into an acquisition process. To address these issues, NOAA recently prepared a model to perform an economic analysis of public versus private acquisition and operation for each of its proposed acquisitions. An experiment with public- private competition in conjunction with this new model could help determine the appropriate size and mix of the fleet and maximize potential savings. Actions ******* 1. NOAA should experiment with a program of public-private competition to help fulfill NOAA's minimum number of days-at-sea (DAS). The program should be conducted for a minimum of one year in each of the three areas of mission responsibility. This experiment should be conducted in parallel with fleet replacement and modernization and should not delay the basic program. The results of this competition, in conjunction with the new economic model analysis, would provide additional support for future modernization decisions. The Request for Proposal (RFP) would be based on desired end products rather than on the type of equipment to be used. The RFP would also specify data kind, quantity and quality to ensure international quality standards. This would allow NOAA to determine areas in which private industry has the capability and interest to provide services. 2. NOAA should bid against private contractors in areas in which the agency can be competitive. However, NOAA's capacity to bid will be limited in the near term, because of the age and condition of much of its existing fleet. Competition would give NOAA an incentive to perform its mission by the most cost-effective methods, either in-house or by contract. Since NOAA would be both buyer and seller, the procurement process must be designed to prevent any conflict of interest or appearance thereof. The process should include an impartial or independent review to ensure that government costs and projected results are properly prepared and all bids properly evaluated. 3. NOAA should obtain an independent review of NOAA's modernization program. NOAA should implement the OAMAC suggestion for an independent review to consider specific topics relating to modernization, including the use of generic hulls and appropriate ship staffing for NOAA's missions. The results of this review should be factored into the modeling process. By combining the modeling results, the competition, and the independent review with NOAA's own internal studies, a more informed decision can be made and justified concerning long-range plans. Implications ************ A core fleet of NOAA-owned ships will remain desirable. However, the size and composition of this fleet ideally and ultimately should be determined by the results of competition, economic modeling, and internal analysis. Because of the poor condition of the fleet and the long lead time needed to acquire or repair ships, however, NOAA may need to reevaluate its plans for ship repair and replacement, to ensure that an appropriate core capability is established as the modernization plan progresses. Public-private competition, in conjunction with economic analysis, should allow the agency to make valid decisions about the size and mix of its fleet without endangering its mission. Fiscal Impact ************* No change in budget authority will be required to implement these recommenda-tions. Endnotes ******** 1. See U.S. Department of Commerce, National Oceanic and Atmospheric Administration, NOAA Fleet Replacement and Modernization Plan (Washington, D.C., March 1, 1991, Revised September 1, 1991). 2. See U.S. General Accounting Office (GAO), Deactivating Research Vessels, National Oceanic and Atmospheric Administration's Use of Private Ships, RCED-86-133 (Washington, D.C.: U.S. General Accounting Office [GAO], June 1986); U.S. General Accounting Office, Ocean Research Fleet: NOAA Needs to Plan for Long-Term Fleet Requirements, RCED-90-42 (Washington, D.C.: GAO, November 1989); U.S. Department of Commerce, Office of Inspector General, Earlier Fleet Studies were Inadequate for Determining NOAA Mission and Fleet Needs, Report No. STD-0200-0-0003 (Washington, D.C., August 1990); and U.S. Department of Commerce, National Oceanic and Atmospheric Management Advisory Committee, Second Report on the Replacement and Modern-ization Plan by the Fleet Modernization Subcommittee for the Department of Commerce (Washington, D.C., October 6, 1992). ******************************************* DOC06: Improve Marine Fisheries Management ******************************************* Background ********** The marine fishery resources of the United States' 200-mile Exclusive Economic Zone (EEZ) are publicly owned and privately used. The U.S. has exclusive fishery management authority over all fish and fishery resources within the EEZ. The economics of traditional open-access fisheries lead to increased competition and overcapitalization, which, in turn, lead to accelerated depletion of fish. Harvesters in developing fisheries initially enjoy substantial returns. As initial benefits attract more participants and total harvests reach sustainable biological limits, combined harvesting efforts tend to increase to prevent declines in individual shares. To maximize net income in the face of rising costs and reduced catches, fishermen often invest in more efficient technology, including larger, more powerful vessels. The resulting competition leads to increased demands at a time when available stocks are static or declining. Fishery managers respond to such situations by setting quotas, regulating gear, limiting fish size, and closing areas or seasons. However, these practices often result in even more overfishing, harvesting inefficiency, and waste, and spur increased investment in vessels and technology, resulting in fleet overcapitalization.(1) Proper management techniques should produce a sustained yield of the fishery resources over time. A 1991 National Marine Fisheries Service's (NMFS) report indicated that of 153 edible species or species groups, 65 (42 percent) are overused (in other words, more resources than necessary are used to obtain the most desirable production), 57 (37 percent) are fully used (an appropriate number of resources result in desirable production), and 31 (21 percent) are underused (more resources are necessary to obtain desirable production).(2) The Magnuson Fishery and Conservation Management Act established a management process for the conservation and management of marine fisheries.(3) Regional Fishery Management Councils (FMCs) have developed 33 management plans that have been implemented by the Secretary of Commerce. Under the act, a fishery management program may require a permit to be obtained and fees paid for an individual, fishing vessel, or fish processor to operate. However, the act limits permit fees to the administrative costs of issuing the permits. Furthermore, fees collected from permits are deposited into the Treasury's General Fund and are not available either to reimburse the department for its costs of issuing the permits or to fund fishery management programs and activities. In 1990, a section was added to provide for the establishment of a trust fund and fee assessment in support of fishery management programs in the North Pacific.(4) This amendment had the general support of the area's fishing industry when it was considered by Congress. New Zealand has implemented a management system which allocates fish among competing users.(5) Five U.S. fisheries use a system of individual transferable quotas (ITQs) similar to the New Zealand plan, which combines traditional conservation regulations with free- market methods of allocation among competing users. This method assigns negotiable shares of the total allowable catch to individuals, which then are transferable in free and competitive markets. After the initial distribution of ITQs, market forces determine individual shares of the total harvest quota. The importance of fishery resource management cannot be overemphasized, since jobs depend on it. Improved management and allocation systems would help to rebuild U.S. fisheries but would require additional resources. For example, the cost to implement a new individual fishing quota system (a version of the ITQ) for the North Pacific sablefish and halibut fisheries alone is estimated at $3.1 million per year. In light of continuing budget limitations, one option would be to underwrite critical management, information collection, and enforcement costs by lifting present restrictions on fees. Ideally, users of public resources should pay the cost of managing them for the public good. User fees are an accepted practice for recovering management costs for land-based resources such as timber and grazing lands. Actions ******* 1. The National Oceanic and Atmospheric Administration (NOAA) should continue collaborating with FMCs and commercial and recreational fishing interests to develop and implement controlled-access plans that include individual harvesting rights, such as ITQs, in accordance with provisions of the Magnuson Act. This is necessary to promote the recovery of depleted fisheries and the industry's economic health. 2. NOAA should work with Congress, FMCs, and commercial and recreational fishing interests to evaluate options for user fees to help offset the cost of implementation of FMPs. 3. Depending on the outcome of these recommendations, NOAA should prepare, in collaboration with Congress, appropriate amendments to the Magnuson Act. Implications ************ The need for innovative assessment and management programs and the funds to support those programs is widely accepted. Support has been voiced by the Marine Fisheries Advisory Committee, FMC representatives, and members of the fishing industry. A key condition of their acceptance is that the funds derived from the fees be used in the fisheries from which they are collected. Some industry members object both to limited-access programs and to fees. In the past, this issue has prompted a wide range of protests from the fishing industry. However, resource depletion and overcapitalization are realities of the present management system. Industry is beginning to understand and accept the need for a basic restructuring of management techniques. Further discussions with Congress, FMCs, and the fishing industry may accelerate industry acceptance. Programs such as ITQs would address overcapitalization by allowing participants to match the level of capital investment with the level of shares. As ITQs are transferred, more harvesters could move to areas that are underused. In addition, smaller, more manageable fleets would allow fishery managers to better control harvests and rebuild depleted stocks. Harvesters would have greater incentives to conserve resources and encourage others to comply with management programs, knowing that their percentage share would result in greater harvests as fisheries are rebuilt. Fiscal Impact ************* If fully implemented, controlled-access management programs would bring economic growth and stability to the fishing industry. NOAA estimates the potential net value derived from adjustments in fleet size and the recovery of over-fished stocks to be $2.9 billion (a $1.8 billion potential increase in gross harvesting revenues from all fishery units, and a $1.1 billion reduction in harvesting costs from increases in efficiency)--a substantial contribution to the economy.(6) Through the use of a combination of licenses, permits, and landing fees, estimated revenue could exceed $100 million annually. This number is a preliminary estimate. Budget Authority (BA), Outlays and Revenues (Dollars in Millions) ******************************************* Fiscal Year 1994 1995 1996 1997 1998 1999 Total ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ BA n/a 0.0 0.0 0.0 0.0 0.0 0.0 Outlay n/a 0.0 0.0 0.0 0.0 0.0 0.0 Revenue n/a 75.0 75.0 75.0 75.0 75.0 375.0 Change in FTEs n/a n/a n/a n/a n/a n/a n/a Endnotes ******** 1. See U.S. Department of Commerce (Commerce), National Marine Fisheries Service, Our Living Oceans (Washington, D.C., December 1992). 2. Ibid. 3. P.L. 94-09265, as amended through November 1990, Washington, D.C., 1976. 4. Ibid., Section 313. 5. See U.S. Department of Commerce, National Marine Fisheries Service, Analysis of the Potential Economic Benefits for Rebuilding U.S. Fisheries (Silver Spring, MD, April 1992). 6. See Commerce, Our Living Oceans. ************************************************ DOC07: Provide EDA Public Works Loan Guarantees for Infrastructure Assistance ************************************************ Background ********** Since 1965, the Economic Development Administration (EDA) of the Department of Commerce has assisted local communities in developing infrastructure to create and retain private-sector jobs. While appropriations and staffing levels have dropped, EDA's main business has remained the same. EDA's largest program in dollar terms is its public works categorical grant program. The agency funds about 200 projects each year, such as industrial park improvements and the construction of incubator buildings, mostly for local government grantees, at an average of roughly $800,000 in grant funds per project. Depending on the level of distress in the community (measured by factors such as low incomes and persistent unemployment), EDA pays up to 80 percent of project costs (up to 100 percent for Indian tribes). Yet the poorest communities often cannot finance even their 20- percent local share. EDA's field staff reports that the usual sources of local matching funds for essential development facilities of long- term benefit are not available to very poor communities. Such governments have exhausted their taxing authority and have little or no general bonding authority, and their discretionary resources, such as Community Development Block Grant (CBDG) funds, are committed to other pressing needs. Even so, more eligible projects exist than EDA can support. As a practical matter, EDA often delays funding, either in the course of processing or by postponing invitations for applications. Occasionally, EDA will fund a smaller percentage of the project costs than the percentage for which an applicant is eligible, or define only a portion of a desired project as EDA-funded, due to its funding limitations. Communities and projects that do not need grant assistance could still benefit from some lower level of financial support, particularly for innovative projects. At a minimal cost to the federal government, a loan guarantee program could serve as catalyst in promoting creative and innovative projects, including the commercialization of new technologies. EDA's current legislation authorize public-works loans and loan guarantees to private borrowers but does not permit loan guarantees for public borrowers. EDA's economic revolving fund was formed to support its loan and loan guarantee activity; it currently has a balance of about $135 million. Repayment of old public-works loans adds approximately $10 million per year to the fund. EDA has not received appropriations for public-works loans since 1978. Between 1966 and 1978, EDA's Public Works Direct Loan Program approved 421 loans for $154 million, with a more than 95-percent repayment rate. The program was discontinued by EDA because of a determination that sufficient funding was available through private capital markets. Action ****** Legislation should be enacted to establish a reserve fund for EDA loan guarantees. Congress should provide EDA with the authority to use a portion (20 percent) of its economic development revolving fund for loan guarantees to financial institutions that make loans to public entities. The guaranteed loans will be secured by general obligation or revenue bonds (not tax-exempt) and/or the property acquired or improved with the assistance. Implications ************ This recommendation would improve customer service by providing EDA with the flexibility to provide greater assistance to economically distressed communities. Assuming a 20-percent subsidy rate, this recommendation should enable EDA to double the amount of public works projects it supports. Based on the current level of funds in the revolving fund account, about $27 million (20 percent of $135 million) would be available to support loan guarantees of approximately $148 million, compared to its fiscal 1993 public works program appropriation of $147 million and its proposed 1994 appropriation of $135 million. Fiscal Impact ************* The cost of implementing this program is well within EDA's current budget authority, assuming EDA reallocates its funds or requests that funds be reprogrammed as necessary to support the contingent liability created as a result of the loan guarantees. ****************************************************** DOC08: Establish a Manufacturing Technology Data Bank ****************************************************** Background ********** The Department of Commerce and other federal agencies produce an enormous amount of scientific and technical information that is directly applicable to manufacturing. As with many federal programs, manufacturing technology research is conducted by a wide and often confusing array of government organizations. The National Institute of Standards and Technology, the Department of Defense, federal research labs, government-funded university scientists, and many other organizations conduct basic research with a combined research and development budget of more than $65 billion a year. Thousands of published and unpublished documents and data files are produced by this combined research effort. Many of these items have direct applicability to businesses. In fact, the ability of U.S. businesses to effectively compete in world markets or create new, high-paying jobs is directly related to how effectively new technologies are identified and converted to or embodied in useful products and services. Technological information moves freely within the research community, but many businesses have a difficult time learning what information is available, how it can be applied to their line of business, and how to obtain it. This is particularly true of small businesses in which research resources are limited. Yet maintaining a competitive edge is vital to the long-term success of small businesses. Many scientific and technical agencies have developed stand-alone services to deliver information to their constituents. However, the federal government has no ongoing and comprehensive cross-agency program to deliver technological information to manufacturers on a continuing basis. The American Technology Preeminence Act of 1991 went a long way toward centralizing the government's collection of scientific and technical information (STI), by requiring each executive-branch agency to transfer to the National Technical Information Service (NTIS ) one copy of the results of all federally funded research and development. However, no good mechanism exists to help businesses sift through this mountain of data to locate information relevant to their needs. Improving manufacturers' ability to identify and obtain relevant technical information can enable them to compete more effectively in their current markets and to enter new markets. The success of these efforts will enhance opportunities for U.S. workers. Well established models can be used as blueprints for the development of a manufacturing technology data bank (MTDB). The Commerce Department's successful National Trade Data Bank (NTDB) has changed the way in which the federal government delivers export promotion and international trade information to the public and its own offices. Moreover, an information delivery system is already well established for these services. A MTDB based on the NTDB model could take advantage of existing software, processing facilities, and distribution systems. Finally, the NTDB experience shows that the quality of reporting improves dramatically when rapid dissemination and feedback become institutionalized. A MTDB containing a core set of data highlighting new production techniques, examples of best business practices, quality assurance and management information, and contacts for additional technical information, also could be used as a teaching tool for engineers, business leaders, managers, product development specialists, basic researchers, and production line workers. The NTDB again serves as a useful model; it is used daily as a teaching tool for students in international business and marketing courses. Exposing students to tools used by businesses while attending colleges and universities gives them skills that can be put to immediate use upon their entry into the work force. Moreover, students often bring these tools to organizations that have not yet taken advantage of these information products. The MTDB can be designed to compile, organize, and disseminate information from a wide range of agencies on an equally wide range of topics or technologies. This stands in marked contrast to existing services that organize information along agency or topic lines requiring extensive, often confusing, searches to research a topic or process. A properly prepared data bank will not be a substitute for existing dissemination services operated by government technical agencies . Rather, it will serve as a complementary service that exposes individuals to basic technical concepts. When a technical area is identified as promising, more extensive research will usually be required to access detailed and narrowly defined databases and services. A technology data bank will introduce a wide variety of technology concepts to manufacturers and can serve as an "idea generator" allowing technical issues to be examined quickly for applicability to a business. No one agency can accomplish this task without cooperation and guidance from other scientific and technical agencies. One reason for the success of the NTDB is the existence of the Interagency Trade Data Advisory Committee (ITDAC), which is charged with advising the Secretary of Commerce on the NTDB's content and operations. A similar organization that focuses on STI can be established to provide effective guidance on items to be included in the data bank, procedures for organizing and searching for information, and distribution channels. Actions ******* 1. The Department of Commerce should establish a manufacturing technology data bank. The Department of Commerce should establish a MTDB using the department's NTDB as an operating model. The data bank should feature highlights of new research applicable to U.S. manufacturers, abstracts of additional technical information available from the federal government and the names of federal contacts in technical areas that assist in implementing these technologies. 2. The Department of Commerce should incorporate input from an interagency coordinating group in the data bank's development. The Secretary of Commerce (or his designee) should chair an interagency coordinating group to establish the content, organization and operation of the data bank. This committee may be an extension of an existing technical coordinating committee, such as the interagency group comprised of the Department of Commerce, the Department of Energy, the National Library of Medicine, the National Aeronautics and Space Administration, and Defense Technical Information Center (CENDI); the Federal Coordinating Committee on Science, Engineering, and Technology (FCCSET); or a new body whose specific duty focuses on the MTDB 3. The Department of Commerce should foster extensive use of the manufacturing technology data bank. The Department of Commerce should ensure that the MTDB becomes a fundamental tool, understood by all federal agencies with programs that assist manufacturers with new technology. The data bank should be used by federal agencies, state and local governments, and university and industry-based programs designed to advise firms on how to incorporate new technology into their business. 4. The Department of Commerce should develop a comprehensive technology dissemination program. The Department of Commerce should administer the development of a comprehensive technology dissemination program that employs multiple types of electronic information media, such as CD-ROM, on-line access, and networked distribution. The program should take advantage of existing information networks and federal depository libraries and offer the data bank for sale on a wholesale and retail basis. Reasonable fees should be charged for these products. 5. The Department of Commerce should develop data bank applications for educational use. The Department of Commerce should encourage development of partnership relationships with educators to ensure that technology applications for the MTDB are developed for use in elementary and secondary schools, colleges, universities, and trade schools; and in adult continuing and remedial education programs. Courses, textbooks, and multi-media applications can be developed to meet defined teaching requirements. Implications ************ Improved access to federal government STI will provide U.S. businesses with enhanced opportunities to bring these technologies to the marketplace. Coordinated delivery of STI by federal agencies will ensure increased use of the information by the U.S. public. Moreover, a coordinated process for disseminating information and receiving feedback should fuel the creation of more accurate, higher quality information in the future. Delivery of STI will be viewed positively by private sector interests. All segments of the economy stand to benefit-- manufacturers, through direct application of new technology; information service providers, through an enhanced ability to obtain and repackage government information; and individuals, through improved work opportunities and the creation of new jobs. Fiscal Impact ************* This initiative will not require additional funding. ***************************************************** DOC09: Expand Electronic Availability of Census Data ***************************************************** Background ********** The Census Bureau of the Department of Commerce collects, processes, analyzes, and distributes valuable current and historical information on every aspect of our economy and society. Users include educators and students; entrepreneurs; urban planners; and local, state and federal agencies. All of these depend on the bureau to deliver timely, accurate and low cost information relevant to their needs. Most of these needs are met through the hard-copy publication of 2,000 to 4,000 releases and reports each year. The bureau pioneered the dissemination of data in computer-accessible form following the 1970 Census of Population and Housing, and was the first federal agency to distribute statistical information on compact disc. Expanding from a base of 10,000 computer-tape customers in 1973, the Census Bureau served 380,000 electronic-media customers in 1992; an additional 1.1 million obtained electronic census information from subsidiary distribution partners, mostly state data centers. Products and services now offered include diskettes, computer tapes, CD-ROMs, a fax system, an electronic bulletin board, automated Census Bureau exhibits at conferences of public and private organizations, and two modest prototypes of on-line direct data acquisition systems. However, despite its pioneering efforts, the bureau has fallen behind emerging information distribution standards. Faster ways to deliver large quantities of census information to more users are needed. For example, to order a product such as a compact disc, users either must submit a paper order form or place the order via the bureau's customer-service phone lines, which are only open nine hours a day, five days a week. Ideally, public and private data users should be able to locate and order (or directly obtain) census information through the medium of their choice at minimum cost, 24 hours a day and seven days a week. On-line Census Bureau databases would allow the immediate use of data to support ongoing research and analysis of the economy, both within and without the federal establishment. While current data from other agencies that measure the economy will not be affected, Census Bureau data could assist in understanding the overall context of these indicators. Actions ******* 1. The Census Bureau should establish a computerized census information access service. Using existing technology, the Census Bureau should establish a new 24-hour computerized census information access service, and be authorized to charge a fee to recover the costs of the service. Users would dial a toll-free number from a touch-tone phone to access a "free" key-word information guide to available products. Easy menu options (much like a bank transaction system) would guide the caller to an appropriate subsystem listing available information and order options for particular products or services. All products and services will involve user fees, which should continue to be based on reproduction costs and should be automatically billable to a credit card or to a pre-credited account for frequent users. Dispatch of products or downloaded data sets should be fully automated. 2. The Census Bureau should publish reports electronically on the Internet. When hard-copy reports are printed and released to the public, they should be simultaneously published electronically on the Internet, a worldwide "network of computer networks" linking organizations in North and South America, Europe, and the Pacific Basin. Internet provides world-wide connectivity to a vast variety of federal, military, educational, research laboratories, contractors and other private sector organizations, researchers and practitioners. 3. The Census Bureau should publish frequently used statistics on the Internet. The Census Bureau should develop and publish on the Internet large databases of frequently used statistics from censuses, surveys, estimates, programs and international data sources. For example, the bureau is preparing an easy to use, 6,000 variable database for every community, county, metropolitan area, and state in the nation based on the results of the 1990 census (DAPS90). It should be made available on Internet. In time, geographically-correlated, disclosure-protected summary data from the Economic, Agricultural, and Government Censuses should be included in this file. 4. The Census Bureau should provide data from micro-records through a dial-up system. For sophisticated users, the Census Bureau should establish a dial-up system containing a "disclosure-free" sample of micro-records from frequently used censuses or surveys. Via a user-friendly software system, the caller could "program" a desired table and download the customized statistics to his or her desktop computer. The Bureau's working SIPP-ON-CALL system demonstrates their ability to design, mount, and operate such systems. 5. The Census Bureau should link these systems (particularly Internet databases) to each of the Census Bureau's 12 regional offices. This will provide for access by "walk-in" patrons and regional federal personnel. 6. The Census Bureau should license these systems to state data centers and affiliates. The Census Bureau should license each of the 54 state data centers to share these systems and "cascade" access to the 1,700 local data center affiliates, including university and public libraries, economic development departments, and councils of governments. Implications ************ These recommendations would significantly increase access to and use of census data, and speed up its distribution. Printed reports, which are costly, cumbersome, and time consuming to publish and distribute, would become less common if they were also available electronically, thereby reducing both user and producer costs. Moreover, data that are too extensive and expensive to tabulate and publish could be made available electronically at lower cost. Increased access, a variety of delivery choices, and 365-day, around-the- clock service make this a "user-friendly" way to disseminate public information. At the same time, these initiatives would provide a foundation for eventual conversion to the digital transmission of data via optical fiber, as this technology becomes more widely established. The ultimate goal is to make it easy to obtain relevant information from five or six reports without having to identify the reports, order them, and wait several weeks to extract needed information. Fiscal Impact ************* This recommendation is budget-neutral. *************************************************** DOC10: Amend the Omnibus Trade and Competitiveness Act to Increase the Data Quality of the National Trade Data Bank *************************************************** Background ********** The Omnibus Trade and Competitiveness Act of 1988 requires the Secretary of Commerce to operate a National Trade Data Bank (NTDB) as a central repository of data compiled or obtained by the federal government relating to trade and international economics. The Secretary delegated responsibility for developing and operating the data bank to the Economics and Statistics Administration (ESA). ESA' s Office of Business Analysis (OBA) has operated the service since its inception. The legislation requires the department to manage the data bank using the most appropriate technology to monitor, organize, analyze, and disseminate the data. The Act requires that "access, including electronic access, is to be provided to virtually every citizen, business, educational, or governmental unit in the United States." The data bank has been successful since it began operating on August 23, 1990. It was implemented on time and under budget. The content and quality of the NTDB has grown continuously. At its inception, the data bank was comprised of 43 information programs contributed by 15 federal agencies. It required one compact disc (CD-ROM) per issue. Today, the data bank is twice its original size, requiring two CD-ROM discs per issue, and containing 100 information programs. This includes information on import and export statistics, foreign country market reports, how-to-export information, and foreign business contacts. Easy to use software allows U.S. businesses and other users to navigate through 130,000-plus documents in the data bank to find information they need. The data bank has revolutionized the method used by the department's U.S. and Foreign Commercial Service to deliver export promotion information to its U.S. field offices and foreign-based sites. The NTDB is in daily use in more than 800 depository libraries located throughout the United States. More than 1,400 discs are sold each month either through single-month sales or annual subscriptions of 12 monthly discs. Despite its success, though, several deficiencies limit the effectiveness of the NTDB. Appropriations have been relatively constant during the life of the project and are not projected to increase. Section 5412 of the Act allows the department to recover "reasonable fees consistent with section 552 of Title 5, United States Code," which is part of the Freedom of Information Act (FOIA). Consistent with these pricing guidelines, each issue is priced at $35 and annual subscriptions at $360. Cost increases have been paid through greatly improved staff productivity. For example, the cost of the NTDB has held constant even though it now requires two CD-ROM discs per issue rather than one. Further innovations or improvements can only be made as funds are found. Experience during 32 months of continuous operation has shown that the FOIA pricing rules, which were designed for relatively simple search and duplication of paper files, do not fit an electronic dissemination system involving electronic data collection, processing and duplication. This is particularly true when the costs of manufacturing and distributing several thousand CD-ROM discs each month, as well as staff resources, training, and other customer- support efforts are included. Despite its large content, significant amounts of information remain outside the data bank. Specifically, Department of Commerce's export regulations represent a large omission, even though significant efforts have been made to include these data in the NTDB. A more comprehensive and usable system to determine a product's trade classification (its Schedule B harmonized code) is also needed to assist users in locating information and preparing export declaration documents. The NTDB, moreover, lacks sufficient data to determine true world markets for U.S. exporters. Export and import statistics report only bilateral trade between the U.S. and its partners. Multilateral or world trade patterns may be determined only through use of data compiled by international organizations such as the United Nations. Unfortunately, most of this information is copyrighted. Dissemination through the NTDB would require licensing fees, which cannot be recovered due to FOIA pricing guidelines. Funding is not available to cover these costs. The NTDB meets the intent of Congress by bringing together important export promotion information that can be of value to thousands of existing and potential new exporters. Even so, it represents an underused and little-known resource among U.S. exporters. One reason for this is that the NTDB is poorly advertised. Experts believe thousands of businesses and individuals would find the NTDB useful if they knew of it. A properly funded marketing campaign oriented to business would require additional funding, but should yield significantly more NTDB customers. Moreover, the relatively small investment would be well worth it if increased use of the NTDB resulted in increased U.S. exports. At present, however, "marketing" of the NTDB generally is conducted by word of mouth or in frequent contacts with new exporters. Budget limitations rule out major, comprehensive campaigns to publicize this service. Rapidly falling technology prices and the increasing use of networked computers present new distribution opportunities that should be used to broaden access to the NTDB. CD-ROM distribution is still limited to the relatively small number of computers presently equipped with this technology. Alternative delivery techniques, such as dial-up or network-based access, could deliver this information to much larger numbers of customers. Actions ******* 1. Section 5412 of the Omnibus Trade and Competitiveness Act of 1988 (P.L. No. 100-09418, 15 U.S.C. sec. 4912) should be amended by removing reference to "fees consistent with" the Freedom of Information Act. This change would allow the department to establish a fee schedule that would permit them to purchase additional data. Additional information supported by the fee increase would greatly enhance the data bank's usefulness for U.S. exporters and international trade policy analysts. 2. The Department of Commerce should place the NTBD on a firm financial foundation to ensure its continued viability. This may be accomplished through two actions. A portion of the revenues generated by the NTDB and related OBA electronic information services should be earmarked for reinvestment into improvements in the content or delivery of electronic information services or direct customer support of these services. Appropriations should continue or increase as necessary to maintain adequate staff and provide the necessary infrastructure to support these services. 3. ESA should contact international organizations (the United Nations, the Organization for Economic Cooperation and Development, World Bank, and International Monetary Fund) and develop an action plan for including their data in the NTDB. The plan should include a determination of the funds necessary to include this information in the NTDB and the consequent impact on user fees. 4. The Secretary of Commerce should direct all Commerce agencies to comply with requests from ESA for data. Missing federal information should be included in the NTDB without delay. Additional data, where necessary, should be tabulated, formatted, or otherwise prepared for inclusion in the data bank. 5. ESA, with the authority of the Secretary and the assistance of the department's Office of Public Affairs and the International Trade Administration, should take appropriate steps to develop an effective marketing plan that publicizes the NTDB as an exporter's resource tool to a large number of potential customers. Strategies should include announcements by high government officials, including the Secretary, and mass marketing via various media strategies. 6. ESA should deliver the content of the NTDB using a full range of up-to-date computer techniques. Specifically, access to the NTDB via the Internet/National Information Infrastructure should become available as soon as possible, with dial-up service to follow. Implications ************ Eliminating fee restrictions and increasing fees would greatly increase the content and quality of the data bank without the need for additional funds. New international data would literally "open the world" to NTDB customers (mostly U.S. businesses). U.S. businesses will be able to better research foreign markets to determine if they want to enter or expand operations in these markets. Improved access to world trade statistics will also improve the analysis of trade issues by policymakers and analysts. The cost of obtaining and disseminating this information to the public would be largely offset by customer charges. Adding export regulations and other trade information would improve the content and present a more complete set of information necessary for a business to engage in foreign trade. These data may be accommodated in the present NTDB environment without major fiscal impact, assuming it is provided in proper electronic format. The Internet/National Information Infrastructure provides an opportunity to immediately disseminate export promotion information to a largely untapped audience--schools and universities. Incorporation of the NTDB in programs to train students in international marketing, business, and economics would provide businesses with a ready supply of capable workers skilled in using tools of international trade. Although lifting the fee restriction would provide funds necessary to purchase additional information, the department must be prepared for some users declining to continue their subscriptions. Fiscal Impact ************* ESA should attempt to recover the additional costs needed to implement these recommendations through increased user fees. The department should develop a fee schedule that would permit them to achieve the above recommendations. The department should establish a revised fee schedule for the NTDB. The actual impact of the fee increase cannot be estimated. Background ********** The Bureau of the Census, the Bureau of Economic Analysis (BEA), and the Bureau of Labor Statistics (BLS) collect many of the nation's most essential economic statistics. Much public sector economic analysis and private sector business planning depends on these statistics, which are collected through a wide variety of monthly, quarterly, and annual surveys and quinquennial economic censuses. Some of these surveys are mandatory; that is, response is mandated under law. Others are voluntary. Companies of all sizes, partnerships, and proprietorships are asked to respond. Some surveys are sent to only a few firms; others are sent to thousands. Inevitably, the collection of economic data by federal statistical agencies imposes a cost on the private sector. In collaboration with the Office of Management and Budget (OMB), these agencies attempt to minimize this burden by simplifying surveys; eliminating outdated surveys; avoiding duplication among surveys; using alternative administrative records, such as Internal Revenue Service (IRS) records; and increasing use of electronic reporting techniques. Some costs cannot be avoided because the statistical agencies take elaborate precautions to assure the confidentiality of data supplied by respondents. "Burden hours" is the measurement used to measure the private sector costs necessary to comply with federal data collection activities. Each hour of an employee's time to fill out a survey questionnaire counts as one burden hour. Over fiscal years 1994-98, the business statistics collection programs of the three federal statistical agencies will incur about 29 million burden hours on U.S. businesses, at an estimated total cost of $870 million. Another way to illustrate the effort involved in collecting, tabulating, and publishing federal business statistics is to note the costs of the federal programs. In fiscal year 1994, the budgets for these business statistics programs, for the three agencies combined, will total almost $266 million. Simplifying data collection from the nation's businesses, linking their statistical reporting schedules to their internal data- generation schedules, instituting rolling reporting schedules to replace "one-shot" reports such as end-of-year reports, and putting all reporting on an electronic data interchange basis would save time and expense for businesses and the federal statistical system alike. Action ****** Legislative barriers to the exchange of business data among federal statistical agencies should be eliminated. This would enable the federal government to significantly reduce the statistical reporting burden on American businesses. Since June 1993, a Statistics 2000 task force, composed of representatives from the three federal statistical agencies, has been working to develop strategies necessary to accomplish this goal. Implementation of the detailed proposals prepared by the task force will call for collaboration with the IRS, including amendment of certain provisions of law regarding the sharing of IRS data. The program should be developed in consultation with a group selected to represent the interests of American businesses. The end result will be a totally new statistical reporting system for most American companies. The program should concentrate on four immediate tasks: --- Elimination of duplicated data requests from the three federal statistical agencies; --- Development of common reporting formats and simplified data requests; --- Development of rolling reporting schedules, timed as best as possible to conform to businesses' internal reporting routines and to avoid the bunching-up of data requests; and --- Adoption of electronic data interchange standards and procedures leading to a paperless reporting system. Progress in these four task areas would permit exploration of a fifth recommendation: --- The restructuring of data collection activities to match company record keeping practices with agency data requests; for example, collecting selected data items for the 1997 Economic Census from companies' division or group levels rather than from individual operating units, and reengineering surveys so that annual surveys do not duplicate data collected during economic census years. Implications ************ Implementation of this program could produce several benefits. First, it would reduce the burden hours placed on private-sector reporters. Burden hours cost companies an estimated $30 per hour. Preliminary analysis suggests that this program, once fully implemented, would cut business reporting costs by around $10 million in most years and by as much as $40 million in years when Economic Censuses occur. More timely and accurate reporting of data from the nation's largest companies could also be expected. An up-to-date "moving picture" of the business performance of the nation's largest companies would be an invaluable tool in assessing the economy's performance. Finally, an intensified collaboration among the three federal statistical agencies would lead to reductions in the costs of collecting, processing, and disseminating data, better data analyses, and improved understanding of the factors that drive performance among the biggest firms in the U.S. economy. Convincing industry that it would truly benefit from participating in the system will be a challenge, but adapting federal needs to companies' internal data procedures should encourage a favorable response to this proposal. In the near future, the automation of corporate data systems should reach the point at which compliance with federal statistical reporting requirements will be viewed as nothing more than a by-product of meeting corporations' own control needs. Fiscal Impact ************* Development and implementation of the Statistics 2000 proposals will not require additional funding. *********************************************** DOC12: Establish a Single Civilian Operational Environmental Polar Satellite Program *********************************************** Background ********** The United States is committed to an operational environmental polar satellite program because of the critical value of the data the satellites collect.(1) Polar satellites collect temperature and moisture measurements (key inputs to computer weather prediction models generating all national three- to five-day weather forecasts); measurements of the Antarctic ozone levels; long-term environmental measurements used to support global climate change studies; sea surface temperature measurements; and global cloud-cover images. Polar satellites also provide other valuable support missions, such as monitoring emergency distress beacons to aid search and rescue missions and worldwide data collection to support a variety of activities, such as endangered species monitoring. However, at present, the nation maintains two polar-orbiting meteorological satellite systems: (l) the National Oceanic and Atmospheric Administration (NOAA) Polar-orbiting Operational Environmental Satellite (POES), for civil forecasting and research purposes; and (2) the Department of Defense (DOD) Defense Meteorological Satellite Program (DMSP) for national security purposes. In addition to these programs, the National Aeronautic and Space Administration (NASA) has initiated a climate research program called Mission to Planet Earth (MTPE). A key portion of this effort is the Earth Observing System (EOS), a series of six different satellites measuring various parameters critical to understanding global climate change. One of these satellites is called the EOS-PM (PM indicating that the satellite passes over the equator in the afternoon). The climate monitoring instruments on EOS-PM are basically more modern versions of the meteorological instruments currently flying on the NOAA weather satellites. In essence, the nation will have three different satellite systems with very similar capabilities. Over the past 20 years, the POES and DMSP programs have made numerous attempts to converge to the greatest extent possible.(2) The programs have similar spacecraft, use a common launch vehicle, share products derived from the data, provide complementary environmental data to the nation, and work closely together on research and development efforts. In all, the programs achieved substantial commonality, but national security concerns have precluded full convergence.(3) DOD has stated it would manage a converged system, but a single program run by DOD was and still is unacceptable given international concern over the militarization of space.(4) Today, however, with the end of the Cold War, the issues which have precluded complete convergence seem to have diminished in importance.(5) With both programs planning a new satellite design, the time is appropriate to consolidate their efforts. The EOS-PM climate research satellite is being designed with the idea that many of the instruments can be used by NOAA within the POES program. This continues a historical NOAA-NASA relationship wherein NASA develops new technology and demonstrates prototype hardware, and NOAA buys identical units for continued operational support.(6) However, current plans involve flying EOS-PM for 15 years, during which time POES also will have operational satellites.(7) Over most of this period, both programs would be flying duplicate instruments. The nation would be more efficiently served if NASA would develop and fly the prototypes once and then transfer the systems to NOAA's operational program for future flights. Convergence studies began in 1972 and have continued ever since.(8) NOAA recently performed an internal study of the opportunities available through convergence of the programs.(9) Recently, initial talks have begun among the three agencies with the goal of performing another study of convergence opportunities among the three programs.(10) What is needed, however, is a clear decision to create a single, civilian polar satellite program. Currently, the NOAA POES program, the DOD DMSP program, and the NASA EOS-PM program all are in various stages of developing new spacecraft and instruments. In the next 10 years, the estimated total cost for these three efforts exceeds $6 billion in development, production, and operations costs. However, many policy makers feel that the nation cannot afford to develop three separate satellite systems with such similar missions. For example, Congressman George Brown of California has stated that a converged system seems more achievable than in the past. He therefore has directed NOAA to work with DOD and NASA to "jointly study and assess the possible benefits and mechanisms for merging all or parts of the three programs." (11) Senator James Exon of Nebraska was more direct in his letters to DOD and Commerce: "The nation cannot afford to maintain and modernize two satellite weather constellations." (12) Recently, at the National Space Outlook Conference, Air Force General Charles Horner, Commander United States Space Command, stated: "How you do convergence is really the question, not if you do convergence." (13) A single operational polar satellite program could meet the needs of all users by incorporating key DOD requirements into the NOAA POES program. Furthermore, the synergy achieved through DOD and NOAA cooperation could allow both agencies to meet critical operational requirements (such as collecting oceanographic and global tropospheric wind data) which neither agency has been able to afford alone. The converged operational program could save additional costs by using the NASA EOS program's state-of-the-art spacecraft and instruments instead of forcing NOAA to design and build its own. The result would be a single development program (compared to the three planned today) and minimal overlap between NASA's climate research and the NOAA-DOD converged operational meteorological missions. The difficulty will be to successfully incorporate DOD requirements into the program. Based upon historical studies, key areas requiring consideration are data deniability, orbit selection, international cooperation, and adequate oversight to ensure DOD concerns are adequately met.(14) The following summarizes how each of these can be addressed: Data deniability. The satellite must broadcast data free to everyone but also have the capability to deny data to specific adversaries. New technology, such as that used to deny cable-TV pay channels to non-subscribers, makes this task easier. Orbit selection. Currently, the DOD desires the capability to change its satellite orbits depending on mission requirements. Past studies have identified a three-satellite constellation as sufficient for meeting all orbit needs.(15) Allowing DOD to influence orbits selection should alleviate their concerns. International cooperation. A NOAA-led system could easily maintain and even improve international cooperation in environmental data exchange. However, since NOAA plans to use foreign satellites as part of the converged program, DOD may be reluctant to rely upon foreign satellites for important data. This concern could be alleviated by maintaining one or more ground spare U.S. satellites at all times that could be launched if a foreign-controlled satellite ever became unreliable. Oversight. DOD will require some mechanisms to ensure their requirements continue to be met. Possible implementation details could involve including DOD user and acquisition experts in the NOAA program offices and operations facilities, allowing DOD to fund and manage DOD-unique parts of the program, and establishing an interagency oversight group to which the program would have to report periodically to ensure that all agency requirements were adequately met. Such oversight mechanisms should not be difficult to achieve. The driving force behind this effort is clearly the desire to reduce costs. Further cost reduction could be achieved through greater international participation. According to Dr. Ray A. Williamson of the Office of Technology Assessment: "Greater international coordination and collaboration on sensors and systems . . . will eventually be needed in order to reap the greatest benefit from the world-wide investment in remote sensing." (16) NOAA is already working on such arrangements in its POES program by asking the Europeans to assume a greater role. An agreement in principle has been reached between NOAA and the European Organization for the Exploitation of Meteorological Satellites (EUMETSAT) whereby EUMETSAT will purchase, launch, and operate one of the two current POES missions beginning in the year 2000. This will save the U.S. more than $100 million for each launch of one of these satellites. Such cooperation with the Europeans is an important component of cost-efficient operations and is the first step to a truly international environmental satellite observing system. Action ****** Legislation should be enacted to establish a single environmental polar satellite program under the direction of NOAA. Congress should enact legislation to establish a single environmental polar satellite under the direction of NOAA. The legislation should direct NOAA, NASA, and DOD to undertake activities to establish this effort within their existing programs. Implications ************ The proposed changes would allow for a more efficient, less-costly global satellite observation program. A strong, efficient U.S. polar environmental monitoring program would be the foundation for a cooperative international system. The Europeans already plan to increase funding for an element of this system. With a solid, unified U.S. national program in place, other countries may align their programs to complement the basic system. The result will be additional environmental data collected at minimal cost to the nation. The convergence concept provides a feasible and cost- effective opportunity to accurately monitor and predict the impact of the environment on the world's societies. The greatest difficulty in the proposal will be to ensure that a single, national program under civilian leadership will be responsive to national security needs. However, these concerns can be met much more easily now than they could have in the past. Fiscal Impact ************* Cost savings over ten years would total about $l.3 billion. This is based on a three-staellite system (with European participation) relying on NASA to develop new hardware. Budget Authority (BA) and Outlays (Dollars in Millions) ******************************************************* Fiscal Year 1994 1995 1996 1997 1998 1999 Total ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ BA 0.0 0.0 -75.0 -75.0 -75.0 -75.0 -300.0 Outlays 0.0 0.0 -50.0 -70.0 -75.0 -75.0 -270.0 Change in FTEs 0 0 0 0 0 0 0 Endnotes ******** 1. See Hussey, John W., "Economic Benefits of Operational Environmental Satellites," reprinted from A. Schnap (ed.), Monitoring Earth's Ocean, Land, and Atmosphere from Space-Sensors, Systems, and Applications, Vol. 97 of Progress in Astronautics series (Washington, D.C.: American Institute of Astronautics and Aeronautics, 1985). 2. See Blersch, Donald, DMSP/POES Convergence Materials Handbook, STDN-91-18. 2nd ed. (Arlington, VA: Analytic Services Inc., October 1991). 3. See U.S. Department of Commerce, Comparison of the Defense Meteorological Satellite Program (DMSP) and the NOAA Polar-orbiting Operational Environmental Satellite (POES) Program, Envirosat-2000 Report (Washington, D.C., October 1985). 4. See U.S. Department of Commerce, National Oceanic and Atmospheric Administration (NOAA), International Implications of Converging the DOD and DOD Polar Orbiting Meteorological Satellite Systems (Washington, D.C., 1987). 5. See Blersch, Donald, DMSP/POES Convergence: A Post Cold War Assessment (A Re-Examination of Traditional Concerns in a Changing Environment) (Arlington, VA: Analytic Services, Inc., June 1993). 6. See U.S. Department of Commerce and National Aeronautic and Space Administration, "Basic Agreement between U.S. Department of Commerce and the National Aeronautics and Astronautics Association Concerning Operational Environmental Satellite Systems of the Department of Commerce," 1973. 7. See National Aeronautics and Space Administration. 1993 Earth Observing System Reference Handbook (Washington, D.C., March 1993). 8. See Blersch, DMSP/POES Convergence Materials Handbook. 9. See U.S. Department of Commerce, "Report of the Working Group on NOAA Polar Satellite Convergence Opportunities," (Washington, D.C., June 1993). (Draft.) 10. See U.S. Department of Commerce, National Oceanic and Atmospheric Administration, National Aeronautical and Space Administration, "Terms of Reference for Joint Defense Meteorological Satellite Program (DMSP), Polar-orbiting Operational Environmental Satellite (POE S) and Earth Observing System (EOS) Program Assessment," June 29, 1993. 11. See Letter from George E. Brown, Jr., Chairman of the House Committee on Science, Space and Technology, to Dr. D. James Baker, NOAA Administrator, February 22, 1993. 12. See Letters from Senator James Exon to Secretary of Commerce Ron Brown and Deputy Secretary of Defense William Perry, June 2, 1993. 13. "Horner Supports Converged System," Space News (June 27, 1993), p. 4. 14. Blersch, DMSP/POES Convergence Handbook, p. II-2. 15. See U.S. General Accounting Office, Economies Available to Converging Government Meteorological Satellites (Washington, D.C.: U.S. General Accounting Office, 1986). 16. U.S. Congress, House Committee on Science, Space and Technology, Subcommittee on Space, testimony by Dr. Ray A. Williamson, Office of Technology Assessment, May 6, 1993. ***************************************** DOC13: Use Sampling to Minimize the Cost of the Decennial Census ***************************************** Background ********** The decennial census of population and housing is one of the federal government's largest and most expensive statistical programs. The full cycle cost of the 1990 census program (fiscal year 1984 through fiscal year 1993) will total nearly $2.6 billion. The results of the 1990 decennial census indicate that the current approach appears to have exhausted its potential for accurately counting the population at a reasonable cost. The Census Bureau's Year 2000 research and development staff has estimated that, if the current approach to the census is retained in the year 2000, the costs could rise to about $4.8 billion in current dollars. Moreover, the average cost per household (measured in 1980 dollars) has steadily increased, from $5.04 in 1950 to $12.10 in 1980 to $17.00 in 1990. In 1990, accuracy fell below that of the 1980 census, while census costs escalated significantly. Between 1940 and 1980, the broad overall measure of census accuracy--the net undercount (the percentage of the population not counted) declined each census. However, the official estimate of the net undercount rose to 1.8 percent (4.7 million persons) in 1990, from 1.2 percent in 1980. The Census Bureau's longstanding policy of attempting to gather data on each nonresponding household (more than 34 million in 1990) has resulted in a reliance on labor-intensive and time-consuming field operations (such as door-to-door canvassing). Such efforts are costly, both in terms of the $1.3 billion spent for census data collection and in the quality of the data collected. The costs of these efforts continue to rise in direct relationship to the declining response rate to census mail questionnaires, which fell by 10 percentage points in 1990 to 65 percent. In addition, it is estimated that the error rate increases significantly for follow-up efforts on nonresponding households, as compared to persons counted primarily by mail return of questionnaires. The Census Bureau estimates that it could have saved $450 million if it had sampled 25 percent of the nonresponding households in 1990 rather than attempting to collect data on all of them. The Census Bureau, however, is unable to use sampling to supplement its current enumeration-based method, due to the current statutory prohibition on the use of sampling in determining the census for the apportionment of Congress. Research by Census Bureau staff suggests that a number of factors, such as illiteracy, rising numbers of non-English speaking immigrants and concerns about privacy, may make the environment for census- taking even worse over the next decade. It is generally agreed that the current census methodology does not and cannot count the entire population, and that the challenges will continue to mount. As a result, the census undercount is likely to increase; costs will rise and the accuracy of the census will decrease. Sampling nonrespondents to support the enumeration-based method offers the opportunity to improve accuracy, reduce the undercount, and lower the cost of the census. Actions ******* 1. Title 13, Section 195, of the U.S. Code should be amended to remove the current prohibition on the use of sampling in the census to determine the apportionment of Congress. Title 13, Section 195, of the U.S. Code should be amended to remove the current prohibition on the use of sampling in the census to determine the apportionment of Congress and authorize the Director of the Census Bureau to use sampling of nonrespondents to supplement the current enumeration-based method. While questions have been raised about the legality of sampling for the census count, according to Census Bureau officials, available legal opinions and case law do not appear to prevent the use of sample-based methods to supplement enumeration-based methods. However, congressional action must take place before the end of 1995 to allow the Census Bureau to make final design recommendations. 2. The Census Bureau should begin planning for statistical sampling of nonrespondent households. The bureau should begin planning and developing a methodology to use statistical sampling of households that fail to respond to the mail- out census form for the 2000 census, rather than attempting to locate and count every individual. Implications ************ Sampling nonrespondents would add sampling error to the census results. The key technical question is whether non-sampling errors can be reduced enough to offset the sampling error. For example, if the reduced workload resulting from sampling would lead to fewer errors, the total accuracy of the result may be better. The key policy issue to be addressed is whether various stakeholders-- Congress, the states, localities, and businesses--are willing to accept census counts that are based in part on a sample. Fiscal Impact ************* The potential savings from the use of sampling can be approximated through the use of the Bureau of Census' cost model. For example, in 1992 dollars, it is estimated that approximately $300 million would have been saved with a 50-percent sample of the nonresponse follow-up workload in 1990. With a 25-percent sample, approximately $450 million could have been saved while maintaining the full complement of district offices; $650 million would have been saved with a reduced number of district offices. Budget Authority (BA) and Outlays (Dollars in Millions) Fiscal Year ******************************************************* 1994-99 2000 (1 in 2 Sample) 2000 (1 in 4 Sample) ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ BA 0.0 -300.0 -650.0 Outlay 0.0 -270.0 -585.0 Change in FTEs 0 -13,000 -26,000 ************************************************* DOC14: Build a Business and Economic Information Node for the Information Highway ************************************************* Background ********** The Department of Commerce is an acknowledged leader in the dissemination of business and economic information through computer and telecommunication technology. The Economics and Statistics Administration (ESA) has been an outstanding innovator in the field. The Census Bureau began distributing its data on computer tape in the 1960 Census and moved to CD-ROMs for the 1990 Census. The Bureau of Economic Analysis distributed its national economic account data on diskette in the early days of micro-computers. The Office of Business Analysis pioneered on-line dissemination of economic data with the Economic Bulletin Board, (EBB) and has greatly facilitated the department's export promotion function with the National Trade Data Bank on CD-ROM. ESA electronic dissemination products now go directly to almost 400,000 individuals and organizations; through "multipliers" (information vendors, state and local government agencies, and educational institutions), ESA data reach as many as one million individuals and businesses in the U.S. Even so, many millions of individuals, businesses, and other organizations do not have access to basic information that would help them in their daily affairs and which would increase their understanding of choices open to them. New developments in computer technology and emerging telecommunications technologies present the department with a significant opportunity to expand the availability of its data services to businesses and individuals at limited costs. Actions ******* 1. The Department of Commerce should build a business and economic information node for the information superhighway. ESA has already established an Internet (a global network of more than a million computers, spanning seven continents, with up to 20 million users) node for the EBB and is now proceeding to test that system with the Federal Depository Library system. The EBB should be extended to a full-scale economic and business information source. 2. Commerce should establish common formats and protocols for data transfer and standards for data description for use within the department and for extension to the entire federal government information community. Precedent for this exists in the standards established for the EBB; the National Trade Data Bank, and the National Economic, Social, and Environmental Data Bank. Forty-one federal agencies already contribute to these products and use these standards. It is essential that business and economic information from the entire federal government be accessible in a unified way. 3. Commerce should establish a prototype "on-line" business and economic information system in the White House (National Economic Council) to develop the concept, refine its data and communications standards, and create a state-of-the-art search and retrieval and analytical system. Later, dissemination techniques developed in the Internet test system can be combined with the most useful techniques of the White House system to create a first-rate business and economic information system for the National Information Infrastructure. Implications ************ These recommendations could bring the federal government significantly closer to connecting every citizen and U.S. business to the government through easy, low cost, direct access to information. At the end of these projects, government business and economics information would be directly available to 10 to 20 million citizens through Internet alone, and to millions more through secondary sources. On the negative side is the clear challenge these moves would present to the private information industry. In the past, these firms have vigorously protested any move by the government to make information directly available to the public and have adamantly protested "value- added" information products. Fiscal Impact ************* This initiative will not require additional funding. *********************************************************** DOC15: Increase Access to Capital for Minority Businesses *********************************************************** Background ********** While the efforts of the federal government and Congress have helped to mitigate the effects of the historic exclusion of minority businesses from the competitive marketplace, minorities continue to experience obstacles to full participation in the free-enterprise system. The most recent statistics from the U.S. Census Bureau indicate that while minorities comprise 19.7 percent of the population, they own 8.9 percent of American businesses. These businesses account for only 3.9 percent of the nation's gross business receipts and generate less than 3 percent of the employment produced annually--figures that have changed very little over the past 20 years . A recent report of the U.S. Commission on Minority Business Development determined that a lack of access to capital was one of the most formidable stumbling blocks to the formation and development of minority businesses. There is a long history of minority businesses' inability to gain access to capital and credit that, in part, accounts for the low entry rate of minorities into business and that has a direct impact on unemployment rates and other social problems. In addition, many minority businesses which start out under capitalized find it almost impossible to obtain capital or credit to expand their operations. Many believe that the Community Reinvestment Act (CRA), enacted more than 15 years ago to overcome barriers to credit and capital in economically disadvantaged communities, has failed. The CRA's impact has been limited due to an overemphasis on process, documentation, and good intentions rather than actual lending to or investments in low- and moderate- income neighborhoods and distressed rural communities. In addition to intrinsic barriers to obtaining capital and credit, minorities are also adversely impacted by the overall decline in lending to all small businesses because of economic conditions, bank regulatory requirements and tighter credit standards by lending institutions. The President has made it a major priority of his administration to address the problem of lack of access to credit for small- and medium-sized businesses and improve the effectiveness of the CRA. To support the President's efforts and to address the specific concerns of minority small businesses, the Secretary of Commerce and the Administrator of the Small Business Administration (SBA) have established a working group to develop recommendations for improving federal assistance to minority businesses, with particular emphasis on access to capital and credit. Actions ******* 1. The Secretary of Commerce and the Administrator of SBA, upon completing their review of the various federal minority business assistance programs (with particular attention on the SBA section 8(a) program and the programs of the Minority Business Development Agency) should make recommendations to the President for improving federal assistance to minority-owned small businesses. These recommendations should be made within 90 days of completing their report. 2. The Secretary of Commerce should determine the feasibility of allocating a portion of Commerce's budget to provide assistance to state and non-profit organizations that provide innovative and alternative sources of credit and capital to minority-owned businesses. 3. The Secretary of Commerce should expand the capacity of the Minority Business Development Agency to identify and develop private and public sources of capital for minority small businesses. 4. The Secretary of Commerce should provide the President with recommendations to improve and strengthen the Community Reinvestment Act by November 1, 1994. Implications ************ Improving federal assistance to minority businesses will contribute to the growth of the economy. Establishment of effective programs to promote the ability of minority business enterprises to participate in the competitive market is an important element in the planning and implementation of strategies to reduce unemployment and other economic and social problems in minority communities. Coordination of the two major federal minority assistance programs will more effectively address the practical problems that hinder the development of minority businesses. Development of a national strategy to provide capital and credit to minority businesses will improve the rate of entry of minorities into business and increase the chances for success for minority businesses in general. Fiscal Impact ************* All of these recommendations can be implemented within the present budget authority. ***************************** Agency Reinvention Activities ***************************** Summary ******* Fhe Department of Commerce has been in partnership with U.S. business for 80 years, seeking to maintain a prosperous, productive America. Over the past decade or so, however, the department slid from being an advocate of economic prosperity to a bystander. As the national and world economies changed, the department too often continued to rely on its traditional ways of doing business. The President and Secretary Brown believe the time has come for change. The fiercely competitive world economy, environmental threats and headlong technological change demand that the department re- examine its basic policies, programs, and operations. Under the Secretary's leadership, Commerce has begun that process to redefine the role it plays in the country's economic and environmental future; to realize the Secretary's determination to make Commerce a government leader; and to spread through the ranks of Commerce employees an optimism about the impact the agency can have and a commitment to a pragmatic, bottom-line approach. The Commerce Performance Review (CPR) has been the vehicle to launch the department in that direction. The Commerce approach is somewhat different from that of other agencies because of Secretary Brown's profound conviction that tapping the knowledge of employees will yield an abundance of improvement ideas. Events have borne him out. Nearly 8,000 ideas have flooded in from employees across the country and around the world. Change is the goal and this outpouring of help set the stage for change at every level. Few areas of the department will remain untouched as it proceeds to implement these ideas. They range from proposals to redirect legislation, to improvements in financial management, to methods of streamlining correspondence processing. Commerce will pursue every idea, regardless of whether it will save millions or merely make one person's job more satisfying. The department's review structure is designed to reflect both the department's central policy themes and its diverse program priorities. Its key elements are summarized below. --- An Executive Committee, consisting of the Secretary and his top staff, which is responsible for final review and approval of all ideas and for systematic review of implementation efforts; --- A Steering Committee (Assistant Deputy Secretary; Acting Chief Financial Officer and Assistant Secretary for Administration; Director for Budget, Planning, and Organization; Director for Human Resources Management; and Confidential Assistant to the Deputy Assistant Secretary which is responsible for day-to-day coordination of the idea-generation effort, oversight and assistance to working teams and cross-cutting teams, compilation of idea books for the Executive Committee, and design of the implementation effort. --- A bureau leader who is responsible for the success of this project within his or her bureau, including the introduction of the idea generation process to employees, process monitoring and evaluation and ranking of ideas. Specific Reinvention Projects ***************************** This report summarizes the results of the massive idea-generation process, but also describes a variety of other approaches pursued in parallel. The department painstakingly re-examined its mission and program priorities. Commerce launched a major customer outreach initiative, convened hundreds of managers into focus groups to share their expertise on a range of more than 20 topic areas, examined the needs and opinions of its customers, and carried out five major cross-cutting studies led by members of the Secretary's top staff. The department expects that it will save significant amounts of money through this process, and is convinced that it will do a better job of delivering products and services to its customers. Ultimately, there can be no more important goal than excellence, and the department plans to achieve that goal, based on the expectations of its customers and clients. The CPR initiative consists of four main components--idea generation, cross-cutting teams, focus groups, and reinvention labs. The Idea Generation Process *************************** Secretary Brown wanted to be sure every employee had opportunities to submit ideas. He launched this initiative with a May 19 letter to all employees asking for their support and ideas. After that, a variety of means were used to get the word out and seek ideas: a special electronic mail box for employees, a memo to all field employees from the directors of the Kansas City and Boulder Administrative Support Centers, a special departmental kick-off meeting in the auditorium, and a series of bureau-sponsored kick-offs. The response was encouraging; nearly 8,000 employee ideas arrived from throughout the country and around the world. The ideas were predominantly "high-payoff" ones. The Secretary's belief in the expertise and innovative spirit of employees is well-founded. The number of ideas received, their quality and creativity, and the obvious effort that went into them are ample evidence of the commitment of the Commerce work force to making the department a better and more effective place to work. The review process was intensive. Every idea was reviewed and evaluated by a bureau head, who was usually assisted by a team of employees, and then submitted for departmental review, first by the CPR Steering Committee and then by the CPR Executive Committee, which includes the Secretary. The Steering Committee then met with each bureau head and agreed upon follow-up implementation. In the meantime, Secretary Brown directed that implementation begin immediately. A number of important steps already have been taken . For example, the following internal procedures have been streamlined or eliminated: --- The requirement for approval of travel by multiple persons to the same destination has been delegated to bureau heads. --- The "counterpart clearance" process for personnel clearance has been eliminated. --- The threshold for grants clearance has been raised to $100,000. --- The threshold for clearance of advisory and assistance services contracts has been raised to $100,000. --- The threshold for BankCard purchases has been raised. The department also selected priority ideas that will be fully researched and prepared as action documents. While some ultimately may not be implemented because of cost or other factors, all offer considerable potential for improving service delivery. Examples of topics being pursued include: --- expanding the availability and improving the quality of economic data on the newly independent states of the former U.S.S.R. and Eastern Europe; --- developing options for an annual forum on governmentwide technology transfer as a means of enhancing commercialization by the private sector; --- automating standard governmentwide and Commerce forms to reduce printing and labor costs; --- exploring methods to improve the department's effectiveness in handling fisheries collection cases in state and federal courts; --- proposing the establishment of a threshold of public burden hours for the Office of Management and Budget (OMB)'s approval of public information collections; and --- examining the costs and benefits of automated fee collection for the public use of patent and trademark search systems. To supplement the internal idea generation process, the department will also seek the input of its customers. A preliminary customer survey (approved on an expedited basis by OMB) was used by five bureaus to provide information to support management improvements. The department is now working with the Bureau of the Census to develop a comprehensive customer survey methodology that will incorporate a combination of written surveys and interviews. This initiative will be part of the continuing effort to reinvent Commerce. Cross-Cutting Teams ******************* Shortly after the idea generation effort began, six cross-cutting programmatic teams were formed. Each was led by a bureau head and included members from throughout the department. They were selected because of their reputation for achievement and innovation. The teams examined broad functional areas, deliberately not confining themselves to traditional organizational boundaries, and developed a wide range of recommendations for the Secretary's approval. Their reports, just completed as this summary was prepared, include 35 proposals for action, including: --- Establishing a one-stop source for computer access to government data on business, economics, international trade, and demographics; --- Developing a coordinated intra-departmental program to inform industry of the need for ISO 9000 quality system standards registration and to educate them on its importance for global competitiveness; --- Launching an initiative to have the department serve as focal point for U.S. firms to promote trade in oil and hazardous chemical spill response products, building on the department's own experience in this area; --- Designing and implementing a prototype technology data bank, using CD-ROM technology, to offer U.S. manufacturers research reports, abstracts, and other data on new technology; and --- Establishing sustainable development as a unifying policy for Commerce programs, reflecting the administration's rejection of the false choice of economic development or environmental protection. These few examples serve to illustrate the breadth of ideas that have been advanced under this initiative. Commerce expects significant benefits to the public from better service delivery to result. Focus Group Sessions ******************** A source of getting new ideas is through a series of focus group sessions which brought together managers from different parts of the department in small, facilitated groups to generate and discuss ideas for improvement. The meetings were organized around specific themes, including five programmatic and seven administrative management topics. More than 400 employees, located both in Washington, D.C. and in the field, were asked to participate. Thirty focus group meetings were held, including 21 in the Washington, D.C. area and nine in five different field locations. The field sessions were held in Boulder and Denver, Colorado; Miami, Florida; Kansas City, Missouri; and Seattle, Washington. In general, headquarters participants tended to be concerned with the policy directions the department will take and how "reinventing" concepts will be used to facilitate change. Field managers, in contrast, tended to be more interested in administrative and management themes and, particularly, in increasing their authority through greater delegation. Specific proposals include the following examples: --- Improving government's ability to work productively with U.S. standards-setting bodies to represent U.S. interests in the international arena; --- Bringing together community-based field offices to work cooperatively on assistance programs; --- Requiring value-added and cost-benefit analyses of all new or revised administrative processes, procedures, and rules; --- Simplifying security classification procedures by removing excess layers of clearance and relaxing the "aggregate classification" rule; and --- Analyzing the extent to which new technologies are moving overseas and why. These five ideas illustrate the range of nearly 100 specific proposals that emerged from the focus-group sessions, all of which are now under review for implementation. Reinvention Laboratories ************************ The fourth avenue for "reinventing" the department is the reinvention laboratory. This technique will enable Commerce to experiment with a variety of approaches to improving program performance. Five reinvention laboratories have been approved to date: The National Technical Information Service (NTIS) will experiment with means to provide one-stop, electronic service for business. Key components will be "FedWorld," a pilot gateway to federal agency electronic bulletin boards, the comprehensive existing NTIS document collection, and electronic on-line dissemination techniques. The Bureau of the Census intends to reengineer the full census process using computer-assisted technologies. This approach reflects the move from traditional paper and pencil data collection to fully automated approaches. The Patent and Trademark Office (PTO) plans to experiment with a plan to allow employees to "telecommute" by performing a substantial portion of their duties at another work site, typically their homes. The experiment will build upon recent PTO advances in automated technology. The Bureau of Export Administration plans to deal creatively with its budget-driven downsizing by creating a more flexible, performance- driven organization, reducing costs without recourse to reductions in force. The department's Boulder, Colorado facility houses scientific laboratories from three bureaus. The reinvention laboratory there will experiment with ways to achieve more efficient operations by examining delegation of authority, service responsiveness, and other support-service mechanisms. Lessons Learned *************** One of the most important lessons learned was that an effort to get ideas for improvement must have the clear support of top management to assure employees of the sincerity of the effort. Secretary Brown's commitment to this process was evident to all, from top program managers to part-time summer clerks. Connected to that principle is the necessity to provide adequate resources to manage the initiative and seek ideas through multiple channels. A second lesson is the necessity for an intensive follow-up. Commerce recognized that gathering and evaluating ideas was merely the beginning of the reinvention effort; ensuring that ideas are acted upon and employees and clients are informed of the results is the real challenge. Commerce will retain its present project structure throughout implementation, with supplemental staff to conduct careful monitoring. In addition, Commerce believes that the involvement of field-office management and employees is critical to achieving the department's reinvention goals. In Commerce's case, nearly half of its staff is located outside the Washington, D.C. metropolitan area, and their perspective provided an invaluable means of reexamining our operations. As was confirmed by the focus group sessions and the ideas provided by employees, field staff tend to have a different slant on priorities and problems and are more concerned with operational issues. Conclusion ********** The Department of Commerce has taken an ambitious approach to its reinvention effort. Its Commerce Performance Review has tapped the ideas of managers, employees, and customers. The full impact of the effort is not likely to be known for some time, as changes are implemented and benefits verified. But Commerce is working with a vast array of ammunition--nearly 8,000 ideas from employees, 100 recommendations from focus groups, and 30 detailed proposals from cross-cutting teams. Potential savings are significant, but these must be carefully researched. Credibility is critical to the continued success of this initiative, and the department must be sure that the results it expects will in fact occur. That principle applies to the less tangible, but equally important, improvements expected in customer service and product quality. That is the ultimate test of this effort and Secretary Brown is determined that the Department of Commerce not just meet but exceed expectations in this area. ************************ Summary of Fiscal Impact ************************ Change in Budget Authority by Fiscal Year (Dollars in Millions) ************************************************************** Recommendation 1994 1995 1996 1997 1998 1999 Total Change in FTEs ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ DOC01: n/a n/a n/a n/a n/a n/a n/a n/a DOC02: n/a n/a n/a n/a n/a n/a n/a n/a DOC03: n/a n/a n/a n/a n/a n/a n/a n/a DOC04: n/a n/a n/a n/a n/a n/a n/a n/a DOC05: cbe cbe cbe cbe cbe cbe cbe cbe DOC06: n/a 0.0 0.0 0.0 0.0 0.0 0.0 n/a DOC07: n/a n/a n/a n/a n/a n/a n/a n/a DOC08: n/a n/a n/a n/a n/a n/a n/a n/a DOC09: n/a n/a n/a n/a n/a n/a n/a n/a DOC10: n/a n/a n/a n/a n/a n/a n/a n/a DOC11: n/a n/a n/a n/a n/a n/a n/a n/a DOC12*: n/a n/a -75.0 -75.0 -75.0 -75.0 -300.0 0 DOC13**: cbe cbe cbe cbe cbe cbe cbe cbe DOC14: cbe cbe cbe cbe cbe cbe cbe cbe DOC15: n/a n/a n/a n/a n/a n/a n/a n/a ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Total n/a 0.0 -75.0 -75.0 -75.0 -75.0 -300.0 0 * Savings result from other agency programs ** Savings are achieved in the year 2000 cbe = Cannot be estimated (due to data limitations or uncertainties about implementation timelines). n/a = Not applicable (recommendation improves efficiency or redirects resources but does not directly reduce budget authority). Change in Outlays by Fiscal Year (Dollars in Millions) ****************************************************** Recommendation 1994 1995 1996 1997 1998 1999 Total ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ DOC01: n/a n/a n/a n/a n/a n/a n/a DOC02: n/a n/a n/a n/a n/a n/a n/a DOC03: n/a n/a n/a n/a n/a n/a n/a DOC04: n/a n/a n/a n/a n/a n/a n/a DOC05: cbe cbe cbe cbe cbe cbe cbe DOC06: 0.0 0.0 0.0 0.0 0.0 0.0 0.0 DOC07: n/a n/a n/a n/a n/a n/a n/a DOC08: n/a n/a n/a n/a n/a n/a n/a DOC09: n/a n/a n/a n/a n/a n/a n/a DOC10: n/a n/a n/a n/a n/a n/a n/a DOC11: n/a n/a n/a n/a n/a n/a n/a DOC12*: 0.0 0.0 -50.0 -70.0 75.0 75.0 270.0 DOC13**: cbe cbe cbe cbe cbe cbe cbe DOC14: cbe cbe cbe cbe cbe cbe cbe DOC15: n/a n/a n/a n/a n/a n/a n/a ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Total 0.0 0.0 -50.0 -70.0 -75.0 -75.0 -270.0 * Savings result from other agency programs ** Savings are achieved in the year 2000 cbe = Cannot be estimated (due to data limitations or uncertainties about implementation timelines). n/a = Not applicable (recommendation improves efficiency or redirects resources but does not directly reduce outlays). Change in Revenues by Fiscal Year (Dollars in Millions) ******************************************************* Recommendation 1994 1995 1996 1997 1998 1999 Total ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ DOC01: n/a n/a n/a n/a n/a n/a n/a DOC02: n/a n/a n/a n/a n/a n/a n/a DOC03: n/a n/a n/a n/a n/a n/a n/a DOC04: n/a n/a n/a n/a n/a n/a n/a DOC05: cbe cbe cbe cbe cbe cbe cbe DOC06: 0.0 75.0 75.0 75.0 75.0 75.0 375.0 DOC07: n/a n/a n/a n/a n/a n/a n/a DOC08: n/a n/a n/a n/a n/a n/a n/a DOC09: n/a n/a n/a n/a n/a n/a n/a DOC10: n/a n/a n/a n/a n/a n/a n/a DOC11: n/a n/a n/a n/a n/a n/a n/a DOC12*: n/a n/a n/a n/a n/a n/a n/a DOC13**: cbe cbe cbe cbe cbe cbe cbe DOC14: cbe cbe cbe cbe cbe cbe cbe DOC15: n/a n/a n/a n/a n/a n/a n/a ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Total 0.0 75.0 75.0 75.0 75.0 75.0 375.0 * Savings result from other agency programs ** Savings are achieved in the year 2000 cbe = Cannot be estimated (due to data limitations or uncertainties about implementation timelines). n/a = Not applicable (recommendation improves efficiency or redirects resources but does not directly create revenue). Appendix B ********** Accompanying Reports of the National Performance Review ******************************************************* Governmental Systems Changing Internal Culture Abbr. ************************* **** Creating Quality Leadership and Management QUAL Streamlining Management Control SMC Transforming Organizational Structures ORG Improving Customer Service ICS Reinventing Processes and Systems ********************************* Mission-Driven, Results-Oriented Budgeting BGT Improving Financial Management FM Reinventing Human Resource Management HRM Reinventing Federal Procurement PROC Reinventing Support Services SUP Reengineering Through Information Technology IT Rethinking Program Design DES Restructuring the Federal Role ****************************** Strengthening the Partnership in Intergovernmental Service Delivery FSL Reinventing Environmental Management ENV Improving Regulatory Systems REG Agencies and Departments Abbr. ************************ ***** Agency for International Development AID Department of Agriculture USDA Department of Commerce DOC Department of Defense DOD Department of Education ED Department of Energy DOE Environmental Protection Agency EPA Executive Office of the President EOP Federal Emergency Management Agency FEMA General Services Administration GSA Department of Health and Human Services HHS Department of Housing and Urban Development HUD Intelligence Community INTEL Department of the Interior DOI Department of Justice DOJ Department of Labor DOL National Aeronautics and Space Administration NASA National Science Foundation/Office of Science and Technology Policy NSF Office of Personnel Management OPM Small Business Administration SBA Department of State/ U.S. Information Agency DOS Department of Transportation DOT Department of the Treasury/ Resolution Trust Corporation TRE Department of Veterans Affairs DVA