**REPORT ON**

**SENATE GOVERNMENTAL AFFAIRS COMMITTEE HEARING ON**

**S.803, E-GOVERNMENT ACT OF 2001**

**ON JULY 11, 2001**

**[SUMMARY]{.underline}**

The Senate Governmental Affairs Committee held a hearing on July 11,
2001 on S.803, E-Government Act of 2001. The Hearing was conducted by
Chairman Joe Lieberman. Ranking Minority Member Fred Thompson and
Senators Ted Stevens, Daniel Akaka, Thomas Carper, Jean Carnahan, George
Voinovich, Robert Bennett, and Thad Cochran attended the hearing.

The objective of S.803 is \"to enhance the management and promotion of
electronic Government services and processes by establishing a Federal
Chief Information Officer (CIO) within the Office of Management and
Budget (OMB), and by establishing a broad framework of measures that
require using Internet-based information technology to enhance citizen
access to Government information and services.\"

There were four witness panels:

**[Panel I]{.underline}**

Senator Conrad Burns, one of S.803 Cosponsors.

**[Panel II]{.underline}**

Mr. Sean O\'Keefe, Deputy Director, OMB

**[Panel III]{.underline}**

Ms. Anne Altman, Managing Director, U.S. Federal, IBM

Dr. Costis Toregas, President, Public Technology, Inc.

Ms. Aldona Valicenti, President, National Association of State Chief
Information Officers

Mr. Greg Woods, Chief Operating Officer, Student Financial Assistance
Programs, Department of Education

**[Panel IV]{.underline}**

Ms. Sharon Hogan, University Librarian, University of Illinois, on
behalf of the American Library Association, the American Association of
Research Libraries and the American Association of Law Libraries

Mr. Barry Ingram, V.P. and Chief Technology Officer, EDS Government
Global Industry Group on behalf of the Information Technology
Association of America

Ms. Patricia McGinnis, President and Chief Executive Officer, Council
for Excellence in Government

Mr. Joseph Wright, former Deputy Director and Director, OMB

A number of the members of Panels III and IV participated extensively in
preparing the draft S.803 and have a keen interest in enhancing citizen
access to Government information and services.

Chairman Joseph Lieberman said the idea is to apply the lessons of the
on-line private sector to the missions of Government. That means
providing better services, more accessible information, and greater
accountability, at significant cost savings. One of the most important
impediments is the lack of a concentrated high-level leadership on
information management issues. That is why their bill creates a Federal
CIO in OMB.

He said they want information and services offered over the Internet to
be accessible to citizens through a single Federal on-line portal,
building on the progress already made by FirstGov.

Ranking Minority Member Fred Thompson said there is a lot going on in
Federal IT. He asked the rhetorical question: what can we do to put
management responsibility in place to handle this more effectively? He
referred to his Government at the Brink report which he provided to OMB
Director Daniels on June 5, 2001. This report contains an analysis of
the four biggest challenges facing the Bush Administration. These
include Federal Workforce Problems and Information Technology Problems.
He also said that clearly, Clinger-Cohen has not resulted in good
management.

Deputy OMB Director Sean O\'Keefe said that Electronic Government is one
of the five elements in the President\'s Management and Performance
Plan. The elements are integration of performance criteria in the
budget, focusing on strategic management of human capital, competitive
sourcing of services, improving financial management and E-Government
initiatives.

He said the Administration\'s vision is to champion a citizen-centric
electronic government framework that will result in an order of
magnitude improvement in the Federal Government\'s value to the citizen.
Also, the Federal Government is spending about \$45B/year on IT, and the
idea is to focus on how to leverage this investment.

There was extensive discussion on IT management topics following Deputy
Director O\'Keefe\'s statement. This included disagreement regarding the
location of the Federal CIO within OMB. Chairman Lieberman and Deputy
Director O\'Keefe each stated a number of times the desire to address
the issues to obtain a successful bill.

Former OMB Director Joseph Wright suggested in his statement that the
reporting relationship within OMB is not as important as the
responsibility and authority given OMB and the CIO. He suggested that
the Committee reach an agreement with the Director of OMB on the right
organizational structure and then hold the Director responsible for the
implementation.

The remainder of this report includes extracts from member opening
statements and witness statements and brief summaries of
questions/answers following each panel.

**[MEMBER OPENING STATEMENTS]{.underline}**

**[Chairman Lieberman]{.underline}**

Goal is not to make Government bigger, but to make it smarter, less
wasteful and more efficient.

Idea is to apply the lessons of the online private sector to the
missions of Government. That means providing better services, more
accessible information, and greater accountability, at significant cost
savings.

Goal is to use information technology to bring about a revolution in
current bureaucratic structures so we can engage the public, restore its
trust and, ultimately, increase public participation.

Today, electronic government at the Federal level lacks a unifying
vision, but a variety of projects are underway and several agencies have
created imaginative Web sites that provide a wealth of information and
numerous services on-line.

Overall, progress in digital government is uneven. There is a loose-knit
mix of ideas and projects that are often poorly coordinated, sometimes
overlapping and frequently redundant. Remarkable innovations can be
found in some quarters, but elsewhere innovations are hampered by
regulatory and statutory restrictions and the inability to move beyond
traditional models of Government management and \"stove-pipe\"
conceptions of agency jurisdictions.

One of the most important impediments is the lack of a concentrated,
high-level leadership on information management issues.

That is why our bill creates a Federal CIO inside of OMB to implement IT
statutes, promote e-government and foster innovation. The CIO would not
replace the agencies\' authority, but would provide a much-needed,
strong Government-wide perspective.

We want information and services offered over the Internet to be
accessible to citizens through a single, Federal on-line portal,
building on the progress already made by the FirstGov.gov Web site
launched last year. Government Web sites should be organized
comprehensively and logically by subject, rather than by agency
jurisdiction.

As the Government moves information and services on-line, it must be
aware of what Senator Thompson has warned against and that is automating
current inefficiencies.

We must also implement performance measures to determine which
e-government applications are successful and cost effective.

Our legislation is a work in progress. We will continue to seek comments
and feedback, especially from the Administration and members of this
Committee.

New information technologies offer an unprecedented opportunity to
re-engineer the way the Government operates and serves the public.

**[Ranking Minority Member Fred Thompson]{.underline}**

There is a lot going on in Federal IT. What can we do to put management
responsibility in place to handle this more effectively?

He referred to his Government at the Brink report on the management
situation in the Government. (**He presented this report to Mitch
Daniels, OMB Director, on June 5, 2001. His report is based on reports
prepared by the Senate Governmental Affairs Committee, the GAO, and
agency Inspector Generals. Volume I (68pages) of his report contains an
analysis of the four biggest challenges or core problems facing the Bush
Administration: Federal Workforce Problems, Financial Management
Problems, Information Technology Problems and Overlap and
Duplication**). Volumes I and II can be accessed at:

[http://www.senate.gov/%7Egov_affairs/vol1.pdf](http://www.senate.gov/~gov_affairs/vol1.pdf)

[http://www.senate.gov/%7Egov_affairs/vol2.pdf](http://www.senate.gov/~gov_affairs/vol2.pdf)

He said the Federal Government has shown a remarkable inability to
manage large IT projects. The Government has spent billions on problem
IT systems.

The Government has human resources problems. Many of these problems are
in the IT area.

Financial management is a problem.

This is the context that e-government finds itself in.

Think in large part this is a management problem.

Clearly, Clinger-Cohen has not resulted in good management.

Don\'t want to create a new bureaucracy on a mess that currently exists.

Do we need to solve one problem before the other before we proceed to an
e-government initiative?

**[Senator Thomas Carper]{.underline}**

Senator Carper (**formerly Governor of Delaware**) said the State of
Delaware struggled with IT initiatives.

If we can do this right, we can do the citizens a big favor.

If we come up with an idea that is not supported by the Executive
Branch, it will die.

Think that new ideas can be better achieved by people closest to the
customers.

**[PANEL I WITNESS STATEMENT]{.underline}**

**[Senator Conrad Burns, Cospsonsor, S.803]{.underline}**

The future of democracy is digital.

The Federal CIO called for in the bill would coordinate information
policy across agencies and would allow the government to fully leverage
the power of the latest communications technologies. The GAO has
recommended establishment of a Federal CIO for several years.

Our E-Government philosophy is simple. Adopt best practices of the
private sector. Allow the Government to fully leverage the latest
technologies.

He shares some of concerns that Senator Thompson has re the current
mess.

The E-Government Act calls for the creation of a centralized on-line
portal to serve as a \"onestop shopping\" Website for citizens. The
Federal CIO would direct establishment of this portal which would build
on the work done by GSA in creating a single, simple Website featuring
all available Government resources on-line. The bill authorizes \$15M
for the portal in FY 2002.

The bill mandates creation of an interagency technology fund to help
break down the traditional and often arbitrary divisions created by
agency boundaries and focus Government resources on meeting constituent
needs.

A collaborative approach on IT issues is far more effective than the
\"silo by silo\" way of doing business favored by the traditional
budgetary process.

**PANEL II WITNESS STATEMENT**

**[Sean O\'Keefe, Deputy Director, OMB]{.underline}**

Electronic Government is one of the five elements in the President\'s
Management and Performance Plan. The elements are:

1.  Integration of performance criteria in the budget.

2.  Focusing on strategic management of human capital. The
    Administration plans to deal with this aggressively.

3.  Competitive sourcing of services.

4.  Improving financial management performance by tackling a series of
    financial management initiatives to correct current financial system
    problems.

5.  E-Government initiatives.

Our strongest view is that the combination of all of these initiatives
pursued concurrently is far greater than the mere sum of the parts

This administration\'s vision is to champion a citizen-centric
electronic government framework that will result in an order of
magnitude improvement in the Federal Government\'s value to the citizen.
The vision is results oriented, market based, and citizen centered as
outlined in the President\'s budget.

To accomplish this vision, we must refocus resources to assure that
information technology facilitates agency administration efficiencies,
but most importantly, to maximize citizen access.

We must simplify business processes to maximize the benefit of
technology, resulting in processes that will be faster, cheaper and more
efficient. We must manage information flows and link them across
agencies and the Federal Government so that we can find and use what we
collect now and in the future.

The Federal Government is spending about \$45B/year on IT. The idea is
to focus on how to leverage this investment. The \$100M E-Government
fund in the President\'s budget is intended to help do this.

Currently, E-Government is very uneven.

This afternoon, the President\'s Management Council will meet to lay out
a management plan (**The President\'s July 11, 2001 Memorandum,
Implementing Government Reform, was issued at that meeting**).

We look forward to working with the Committee to help fashion
legislation that could drive real change in this area.

Mr. O\'Keefe\'s complete statement can be accessed at:

[http://www.senate.gov/%7Egov_affairs/071101_okeefe.htm](http://www.senate.gov/~gov_affairs/071101_okeefe.htm)

**[Panel II Questions/Answers]{.underline}**

**[Q.1 Chairman Lieberman.]{.underline}** Agree that S.803 should
address performance standards (**This was in response to a statement in
Mr. O\'Keefe\'s written statement that legislation on electronic
government must contain performance standards).** Think the biggest
disagreement we have with the Administration is the location of the
Federal CIO. Concerned with the model taken by the Administration by
naming Mark Foreman as Associate Director reporting to the Deputy
Director for Management (DDM). This leads to a series of questions why
this choice was made compared to the private sector.

A.  Mr. O\'Keefe. We agree that IT management needs to be elevated. We
    believe that the Director of OMB\'s selection is consistent with
    Clinger-Cohen and GPRA. As an individual CIO, this becomes more like
    a program element. The objective of the approach we have chosen is
    to integrate the CIO with the overall decision-making area.

**[Q.2 Chairman Lieberman]{.underline}.** Have concern that the DDM is a
very busy office already and fear the emerging aspects of IT can be
lost. We will consider what you have said.

A.  Mr. O\'Keefe. We are quite confident this approach will accomplish
    the President\'s vision.

**[Q.3 Chairman Lieberman]{.underline}**. We hope to Move S.803 forward
to take it up on the Senate floor this fall. Senator Daschle has agreed
to this.

Can you speak for a minute on the E-Government Fund?

A.  Mr. O\'Keefe. Objective is to use the fund to help leverage the
    \$45B/year currently being spent on IT. Cannot attest re overall
    approach in agencies. Some are cutting edge, and some are
    struggling. Want to use the fund to achieve integrated systems.

**[Q.4 Chairman Lieberman]{.underline}**. Have you seen any IT stars in
the agencies?

A.  Mr. O\'Keefe. Think most aggressive is the IRS which is
    wide-ranging. Within DOD are some of the very best and some of the
    very worst. Certain of the financial community are out in front, and
    some are in trouble.

**[Q.5 Senator Stevens]{.underline}.** We now have two library systems,
automated and manual. Are we going too fast in Government so that we
won\'t be able keep both in compliance?

**A.** Mr. O\'Keefe. We are attempting to make up for lost ground. We do
want to keep a level playing field for those with and without
automation.

**[Q.6 Ranking Member Thompson]{.underline}**. You mentioned IRS and DOD
as having some of the best and some of the worst. Do we really have the
ability, regardless of where a Federal CIO sits, re putting things
together, or are we really accomplishing anything?

A.  Mr. O\'Keefe. Any time you set up a means to service a specific
    community, you have the potential for continuing to preserve
    specific systems. If anything, you can use this approach for IT to
    accomplish system integration.

**[Q.7 Ranking Member Thompson.]{.underline}** How is the Office of
E-Government going to interrelate with OIRA and the Office of Budget?

A.  All of these will operate on an interdisciplinary basis to
    accomplish the mission.

**[Q.8 Senator Carper.]{.underline}** Where are we right now, what would
the Administration like to do and how does this relate to S.803?

A.  The President\'s management initiative is primarily focused on
    citizen centric government and making it more responsive transaction
    commerce to improve efficiency, and to facilitate government to
    government exchange. Where are we now? It is an uneven application
    across Government. Regarding how to interrelate with S.803? We want
    to work with the Committee on this. The President wants the DDM to
    be the Federal CIO working with Associate Director Mark Foreman.
    They will work with OIRA and the Office of Comptroller on IT
    management and budget.

**[Q.9 Senator Carper.]{.underline}** Need somebody who can reach out to
the Departments.

A.  Mr. O\'Keefe. We agree.

**[Q.10 Senator Bennett.]{.underline}** Am very concerned about
security. Think a minute about denial of service attacks and the
vulnerability the Government might have to a concentrated attack.

A.  Mr. O\'Keefe. Think the key is to be attentive to this. There are
    lots of ways to address this. We want to identify security plans
    early on as new systems are brought in. Part of problem is to be
    addressed in the new Executive Order (**The draft Executive Order
    would establish a Cybersecurity and Continuity of Operations Board
    to oversee cybersecurity in lieu of appointing a cybersecurity czar.
    The draft was circulated for comment the week of 7/16/2001.).**

**[Q.11 Senator Bennett.]{.underline}** I am familiar with the proposed
new Executive Order. At a Joint Economic Committee hearing there was a
statement that security is being approached tactically and not
strategically. Wouldn\'t this tie in with the Federal CIO? Are any of
these concepts on OMB\'s radar screen or are they with the National
Security Council?

A.  Mr. O\'Kleefe. OMB has this as a dominant issue. If anything, we are
    approaching this on a coordinated basis. We have spent a lot of time
    vetting this. Condy Rice (**President\'s National Security
    Advisor**) has led the charge on this. OMB has participated in the
    meetings and planning. This is very important. Agree with your
    concerns on this.

**[Q.12 Senator Voinovich]{.underline}.** Like your approach in wanting
to work with the Committee on IT issues. Also, we can\'t forget that
E-Government will require a technical savvy Government. Think you need
to do an inventory of IT resources and what you have to do to attract
new employees.

Would like to receive a status report on compliance with the Federal
Managers Financial Integrity Act (FMFIA). Do agencies have resources to
address electronic grants?

You mentioned the need to integrate the various management reform
initiatives. We are interested to know how the Administration proposes
to address standards.

A.  Mr. O\'Keefe. On standards. We hope to use commercial standards. The
    idea is to use standard commercial practices. We hope to use
    technology that is no more than two years old. The CIO Council will
    be charged with determining what the standards should be.

> We are dedicated to working with the Committee on S.803 to help obtain
> a successful bill.
>
> Regarding human capital planning. We have asked each agency to produce
> a human capital report that addresses agency needs and how the agency
> plans to deal with retirement losses and attracting new employees.
>
> Regarding FMFIA. The Secretary of HHS is working aggressively with
> agencies on this project.

**[Q.13 Senator Carnahan.]{.underline}** What can we do to make
E-Government more accessible to citizens?

A.  Mr. O\'Keefe. This is very important. Believe the industry has been
    aggressive in working to achieve this from a technology standpoint.

> One of the greatest advances is the establishment of FirstGov. It will
> take more and more uses like this. All of this is achievable.

**[Q.14 Senator Lieberman]{.underline}**. Would like to address these
issues with the Administration soon to see if we can begin the process
of moving forward soon with the bill.

**[PANEL III WITNESS STATEMENTS]{.underline}**

**[Anne Altman, Managing Director, US Federal, IBM.]{.underline}**

The most important part of IBM\'s transformation commenced when we
decided to become an e-business in 1998.To do this, we had to integrate
Internet technology into our core business processes. We had to fuse
business and IT strategy. We had to rebuild IBM to adapt to continuous
change and use a foundation of simplified and integrated business
processes. The most important lesson learned was\--We had to break down
the walls between our operating units, or silos, and become a single,
integrated organization with seamless connections between our employees
and between our company, our suppliers, our customers and our business
partners.

Our management expected the corporate CIO to be responsible for the
company\'s technical leadership including:

> -Providing leadership for IT investments in new technologies and
> innovations.
>
> -Providing leadership for corporate IT initiatives.
>
> -Developing global IT strategies and goals.
>
> -Defining IT architecture, infrastructure, standards, guidelines and
> processes.
>
> -Developing and managing the deployment of the IT infrastructure
> worldwide.
>
> -Optimizing the investment in IT infrastructure worldwide.
>
> -Evaluating, selecting and negotiating enterprise-wide service
> agreements.
>
> -Developing and ensuring compliance with overall IBM service-level
> requirements.

Additionally, the CIO is responsible for business transformation (BT)
across the whole of IBM. The [BT/CIO]{.underline} has a strategic
leadership function and is in effect an agent of cultural change.

The BT/CIO function works with business process executives and business
transformation executives across the business units globally to create
and manage an integrated application architecture and ensure compliance
with corporate standards and processes.

We save 70% of the cost of a service transaction when we perform it over
the Internet as opposed to the old paper or manual format.

To be successful, the Federal Government should develop a plan that
addresses the following fundamental choices: leadership, integration,
infrastructure, human resources, privacy, security and resistance to
change.

**[Dr. Costis Toregas, President, Public Technology, Inc
(PTI)]{.underline}**

PTI is the non profit research and development local government
organization, and our membership of innovative cities and counties has
been innovating with the definition, development and deployment of E-Gov
for much of the decade of the nineties. PTI is also the technology arm
for the National League of Cities, the National Association of Counties
and the International City/County Management Association.

The experience of local governments in E-Gov can be summarized in a
small number of Guiding Principles which I believe have merit for the
Federal Government:

1.  E-Gov encompasses the improvement of service delivery to the
    citizen, the creation of economic activity and the safeguarding of
    Democracy. Each of these dimensions is important in its own right
    and must be addressed in any E-Gov investment.

2.  E-Gov must be oriented toward the citizen. The citizen does not care
    what level of government or agency provides the needed service,
    therefore, the interagency and intergovernmental dimensions are
    important.

3.  E-Gov demands an E-citizen. Before we call an E-Government program
    successful, it must be made available to all citizens, not just
    those who can afford to pay or can find the electronic
    infrastructure available.

4.  E-Gov provides an opportunity to re-engineer the way Government
    operates. Merely automating existing services is inadequate and does
    not match the potential of this promising technology.

5.  E-Gov is an opportunity to establish viable and sustainable
    partnerships between the private and public sectors under which each
    side provides capacity in areas of competitive range.

Instead of addressing E-Gov across all agencies and departments
simultaneously, it may be wise to concentrate funding around areas in
which citizens attach a high priority, learn from the experiences and
then scale the successful efforts to a national system.

**[Aldona Valicenti, President, National Association of State Chief
Information Officers (NASCIO)]{.underline}**

NASCIO is supportive of many of the elements of S.803. I will comment on
provisions of the bill as they fit into NASCIO\'s considerations of the
critical elements of a comprehensive approach to E-Government which are:

-   **Executive leadership and commitment-creation of a \"center of
    gravity\".** NASCIO has testified to the Congress its support for
    the creation of a dedicated Federal CIO position. NASCIO sees the
    need for central focus of leadership, and one Federal point of
    contact to interface with the states on IT issues. The CIO is, as
    the Kennedy School of Government has stated , a \"center of
    gravity\" around which IT, the great enabler of our modern age
    revolves.

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-   **Integration across agencies and program stovepipes**. Any
    successful enterprise-wide approach to electronic government
    requires the ability of the CIO to be able to set standards and
    enforce compliance across agencies. In Kentucky, legislation was
    created that provides me, as the Commonwealth CIO, with
    responsibility for reviewing and overseeing large and integrated IT
    projects and systems for compliance with statewide strategies,
    policies and standards, including alignment with the Commonwealth\'s
    business goals, investments and other risk management policies.

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-   **Creation of a regular, meaningful Federal interagency and
    intergovernmental consultation process**. We support the Act\'s
    provisions which establish the CIO Council. Drawing from my own
    experience, in Kentucky, the Commonwealth CIO chairs a Governance
    Team, comprised of CIOs from all branches of State government, who
    discuss and coordinate on IT issues, policies, directions and
    investments. We are particularly encouraged by the provisions of
    S.803 which require the establishment of regular forums with leaders
    in information resources management in state, local and tribal
    government, including NASCIO.

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-   **The will to invest in IT to achieve goals, including cost
    savings.** In 1996, Governor Patton\'s \"EMPOWER Kentucky\" was
    designed to re-engineer how State government worked. Out of the
    re-engineering effort and process redesign, it became clear that IT
    would become a key enabler of how services would be delivered.

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-   **Focus on citizen-centric approach to service delivery.** NASCIO
    believes that citizens must see themselves as the owners of their
    government, and electronic government can be used to convey that
    ownership to the people.

**Gregg Woods, Chief Operating Officer, Student Financial Assistance,
U.S. Department of Education**

Mr. Wood\'s statement reviewed the E-commerce system changes/

enhancements that have been implemented in Student Financial Assistance
Programs.

**[Panel III Questions/Answers]{.underline}**

**[Q.1 Chairman Lieberman.]{.underline}** We are talking about Community
Technology Centers in S.803 (**Section 213 calls for a study not later
than two years after effective date of Act to evaluate best practices of
Community Technology Centers that receive Federal funds**).

A.  Dr. Toregas, President, Public Technology, Inc.(PTI) About 2000
    counties and cities now have Community Technology Centers.

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A.  Ms. Altman, Managing Director, U.S. Federal, IBM. Technology is
    moving rapidly to hand-held devices. Believe this will help reduce
    the digital divide.

**[Q.2 Chairman Lieberman.]{.underline}** How should the CIO be
structured?

A.  Ms. Altman, IBM. A CIO is a CIO and a transformation executive and
    is responsible for managing business strategy. Not sure where should
    reside.

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A.  Dr. Toregas, PTI. Must have programmatic people linked to the
    process. IT people and programmatic people must work together.

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A.  Ms. Valencenti, President, National Association of State Chief
    information Officers. The CIO must be a peer at the table. In the
    past, has been done too much from a technology standpoint. Must have
    technology and performance standards.

**[Q.3 Ranking Member Thompson]{.underline}**. You remind us that we can
learn from one another.

Your program (to Gregg Woods, Student Financial Assistance Programs,
Department of Education) is one that troubles the most. Student Loan
program has been on GAO\'s High Risk program since 1990. Student aid
programs have spawned a cottage industry of criminals. Thus far the
Department has failed to address I.G. recommendations. The I.G. and the
GAO continue to report on the same financial problems. The Department is
not complying with Clinger-Cohen. Can one person at OMB ride herd on
this? Am interested if you understand the underlying management issues?

A.  Mr. Woods. We take the criticism constructively. The Department is
    completely retooling the systems. We can report progress. Default
    cases are down.

**[Ranking Member Thompson]{.underline}**. Suggest you concentrate on
the management aspects as well as the high tech side.

**[PANEL IV WITNESS STATEMENTS]{.underline}**

**[Sharon Hogan, University Librarian, University of Illinois at
Chicago, on behalf of the Amercican Library Association, American
Association of law Libraries and Association of Research
Libraries]{.underline}**

Ms. Hogan is Chair of the Committee on Legislation of the American
Library Association and the Committee on Information Policies of the
Association of Law Libraries. The library community has a strong
interest in Federal information policy and collectively, their
associations represent thousands of libraries and librarians across the
Nation.

Our democracy is based on the public\'s right to have access to
information by and about their government.

During the past decade, Federal agencies, Congress and the courts have
moved increasingly to rely on the Internet as the preferred system of
public information access and dissemination.

A strong and positive framework is absolutely necessary to ensure that
the public will have seamless, continuous and permanent access to
important electronic information. The E-Government Act of 2001 addresses
the need to increase the visibility of the many unresolved challenges of
E-Government and to develop a coordinated approach to make optimum use
of digital technologies for the benefit of our citizenry.

We agree that there is currently a lack of coordination, cooperation,
guidance or a means to oversee and measure agency compliance with many
existing statutes. In the Executive Branch, the lack of enforcement for
such policies as A-130, the lack of adequate funding for agencies, and
the lack of coordination to guide agencies toward efficient use of
technology to improve the public\'s access to information and services
have become barriers between our citizens and their ability to easily
locate and use Government information.

The CIO Council has focused its energies on important issues such as
Y2K, cybersecurity and privacy. The Council now needs to focus on the
equally important responsibilities for the life-cycle of agency
information.

**[Barry Ingram, VP EDS Global Government Industry Group on behalf of
the Information Technology Association of America (ITAA)]{.underline}**

ITAA has been a longtime proponent of E-Government and helped to provide
input on principles used early on to develop this legislation.

We are particularly eager to generate the same interest and progress in
E-Government at the Federal level that we have witnessed at the state
and local level.

E-Government holds the real potential to enable a citizen-centric
transformation of our Government. Utilized effectively, E-Government
efforts can bring a 24X7 service capability to meeting the needs of
citizens, while improving Government efficiency, accountability and
transparency, helping to produce a more results-oriented Government.

ITAA\'s leading edge member companies have already migrated the private
sector to Internet E-business technologies and applications and we look
forward to your commitment that the Federal Government will engage the
private sector to achieve the E-Government goals set forth in your
legislation.

The following is a \"Top Ten\" list of lessons learned for E-Government:

1.  Implementing successful E-Government requires sponsorship and
    visibility from the top-senior leadership and championing.

2.  Cross-agency government standards are essential-across departments,
    agencies and government levels\--in order to most effectively share
    and reuses applications, information and capabilities.

3.  Bringing services on-line raises expectations\--technologies and
    infrastructures need to be robust-we cannot build new
    high-performance systems on shaky foundations.

4.  Build in rapid scalability-when it works-they will come\--and at a
    speed and volume that must be anticipated.

5.  Ensure citizens\' privacy and security with good information
    assurance capabilities\--build this into the architecture before
    privacy and security become a problem.

6.  Many existing business processes will need to be re-engineered, but
    don\'t just reengineer\--reinvent wherever possible and look at new
    ways of doing business.

7.  Provide incentives for citizens and business to use the new
    E-Government services\--incentives will enable the move to new
    methods.

8.  Counter services also need to be preserved and improved with
    E-Government innovation\--the Digital Divide will be with us for a
    long time, so we have to maintain current capabilities. They can be
    bolstered with the came new technologies and improved business
    practices.

9.  Heavily promote new on-line services to the citizens and to other
    agencies.

10. Adopt new and innnovative funding methods and develop new
    partnership models with the private sector.

**[Patricia McGinnis, President and CEO, Council for Excellence in
Government.]{.underline}**

The Council for Excellence in Government has assembled an E-Government
initiative in partnership with 350 leaders from Government, business,
civic groups and the research community. Together we developed a
blueprint for E-Government which we released in February: Electronic
government: The Next American Revolution, because we believe strongly
that the Internet has the potential not only to revolutionize the way
Government operates but also to put ownership of Government truly in the
hands of all Americans.

We envision a Government that organizes and offers its information and
services around the [needs of people]{.underline} rather than the
organization of Government agencies.

There are several important guiding principles for E-Government:

-   It has to be easy to use, accessible to everyone, private and
    secure, and innovative.

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-   We have to invest in public-private, interagency, and
    intergovernmental partnerships to design, implement and mange truly
    effective E-Government.

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-   We have to eliminate the digital divide providing not only access
    but also education to those who need it.

Examples of E-Government fall into the categories of Government to
Citizens (G to C) and Government to Business (G to B). What is missing?
Government to Government (G to G). At this point, there is very little
cross agency or intergovernmental collaboration on-line and this is a
significant problem.

The Congress has set an ambitious goal for the Federal Government
through the Government Paperwork Elimination act to offer all of its
services and transactions on-line by 2003. This is a challenge that
should be taken seriously by setting priorities based on customer needs
and impact to get services and transactions on-line in an integrated,
user friendly way. This will require collaboration across agencies which
serve the same customers and effective partnerships with other levels of
government and the private sector.

The development of S.803, the E-Government Act, is an example of
E-Government in action. Just over a year ago Senator Thompson and
Senator Lieberman launched the first ever Senate Website to gather and
exchange ideas about what should be in this legislation.

Leadership must come not only from OMB and the CIO Council but from the
President, the cabinet, the Congress, governors, mayors, state
legislatures and the judiciary. All must embrace E-Government as a tool
to improve Government performance and revitalize our democracy.

**[Joseph Wright, former Deputy Director and Director,
OMB]{.underline}**

While state and local governments are pushing into the transformation
phase of E-Government development, Federal E-Government initiatives are
focused on the development of transactional applications. The Federal
CIO Council recently counted 1,363 Federal electronic pilots or programs
of which only 463 involved transactions with the Government, the rest
simply provide information.

This lack of focus on transactional applications is a direct result of
the lack of centralized strategy, planning and leadership at the Federal
level for E-Government development. Projects to date, even when they
have been transactional, have been agency-centric, rather than
citizen-centric and represent a very small percentage of the business
that agencies conduct.

FirstGov.gov is one of the most important Federal E-Government
initiatives; however, the first phase only allowed for user access to
information. New agency-centric transactional applications are being
developed. There are currently no major interagency applications.
FirstGov lays the foundation for entry into the transformation state of
E-Government, but a tremendous amount of work and strong leadership are
necessary to accomplish this. If the President truly intends to have a
citizen-centric Government where \"agencies conduct transactions with
the public along secure Web-enabled systems that use portals\", then the
FirstGov Web site needs to be enhanced substantially with a specific
plan to bring on agency programs and services in a centrally directed
effort that is well-coordinated throughout Government.

S.803 calls for the appointment of a Federal CIO. This is a good idea.
While I\'m not sure that the organizational solution to accomplish
central leadership, I do agree that a successful E-Government initiative
requires decisive focused top-level leadership. I also agree that the
authority should be closely associated with the budget process and have
the full authority of the budget and be located within OMB.

The Director of OMB recently appointed Mark Forman as the Director of
E-Government initiatives for the Federal Government who could also be
given the additional responsibility of CIO.

The reporting relationship within OMB is not as important as the
responsibility and authority given to OMB and the CIO. I would suggest
that this committee reach an agreement with the Director of OMB on the
right organizational structure and then hold the Director responsible
for the implementation.

**[Panel IV Witness Questions/Answers]{.underline}**

**[Q.1 Chairman Lieberman.]{.underline}** Re CIO responsibilities?

A.  Mr. Ingram, EDS. EDS now has a CIO at the corporate level who
    reports to the head of the company. He has a budget and sets
    priorities. Have one common architecture. Have one single format for
    Web pages. Think it should work the same way at the Federal level.

**[Q.2 Chairman Lieberman.]{.underline}** One of the Council for
Excellence in Government recommendations was to appropriate \$3B over a
five year period for an E-Government Strategic Investment Fund. How did
you arrive at that number?

A.  Ms. McGinnis, Council for Excellence in Government. We used Y2K as
    the model. The exact amount is not as important as having the
    flexibility to use the money to go beyond boundaries of agencies.

**[Q.3 Chairman Lieberman.]{.underline}** Polling shows the need to
allow people to be involved.

A.  Ms. McGinnis. Polling shows that people want to do more with
    E-Government than applying for licenses

**[Q.4 Ranking Member Thompson.]{.underline}** Commented that
Clinger-Cohen placed IT management responsibility on the Director, OMB.

**A.** Mr. Wright, former Deputy Director and Director, OMB. The
Director, OMB must continue to have the budget hammer

If there are questions or for further information, please contact John
Ray

at <john.ray@gsa.gov> or (202 501-3473.

July 23, 2001.