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WHO’S WATCHING THE COOP? A RE-EXAMINATION OF FEDERAL AGENCIES’ CONTINUITY OF

OPERATIONS PLANS

HEARING

BEFORE THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

APRIL 28, 2005

Serial No. 109–26

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpo.gov/congress/house

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

GINNY BROWN-WAITE, Florida

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

MELISSA WOJCIAK, Staff Director

DAVID MARIN, Deputy Staff Director/Communications Director

ROB BORDEN, Parliamentarian

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

(III)

C O N T E N T S

Page

Hearing held on April 28, 2005 .............................................................................. 1

Statement of:

Hoover, Reynold N., Director, Office of National Security Coordination,

Federal Emergency Management Agency, U.S. Department of Homeland Security; Marta Brito Perez, Associate Director, U.S. Office of

Personnel Management; and Linda Koontz, Director, Information Management, U.S. Government Accountability Office ...................................... 15

Hoover, Reynold N. ................................................................................... 15

Koontz, Linda ............................................................................................ 37

Perez, Marta Brito ..................................................................................... 29

Kane, James A., Ph.D., president and CEO, Systems and Software Consortium; Julie Williams, director, Internet business solutions group,

Federal civilian agency practice, Cisco Systems; and Kevin Luten, public policy representative, Association of Commuter Transportation ......... 62

Kane, James A. .......................................................................................... 62

Luten, Kevin .............................................................................................. 88

Williams, Julie ........................................................................................... 71

Letters, statements, etc., submitted for the record by:

Davis, Chairman Tom, a Representative in Congress from the State of

Virginia, prepared statement of ................................................................... 4

Davis, Hon. Danny K., a Representative in Congress from the State

of Illinois:

Letter dated February 21, 2005 ............................................................... 101

Prepared statement of ............................................................................... 9

Hoover, Reynold N., Director, Office of National Security Coordination,

Federal Emergency Management Agency, U.S. Department of Homeland Security, prepared statement of .......................................................... 18

Kane, James A., Ph.D., president and CEO, Systems and Software Consortium, prepared statement of ................................................................... 65

Koontz, Linda, Director, Information Management, U.S. Government Accountability Office, prepared statement of ................................................. 39

Luten, Kevin, public policy representative, Association of Commuter

Transportation, prepared statement of ....................................................... 91

Perez, Marta Brito, Associate Director, U.S. Office of Personnel Management, prepared statement of ........................................................................ 31

Porter, Hon. Jon C., a Representative in Congress from the State of

Nevada, prepared statement of .................................................................... 111

Ruppersberger, Hon. C.A. Dutch, a Representative in Congress from the

State of Maryland, prepared statement of .................................................. 12

Williams, Julie, director, Internet business solutions group, Federal civilian agency practice, Cisco Systems, prepared statement of ...................... 74

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WHO’S WATCHING THE COOP? A RE-EXAMINATION OF FEDERAL AGENCIES’ CONTINUITY

OF OPERATIONS PLANS

THURSDAY, APRIL 28, 2005

HOUSE OF REPRESENTATIVES,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The committee met, pursuant to notice, at 2 p.m., in room 2154,

Rayburn House Office Building, Hon. Tom Davis (chairman of the

committee) presiding.

Present: Representatives Davis of Virginia, Shays, Duncan, Dent,

Waxman, Cummings, Kucinich, Davis of Illinois, Watson,

Ruppersberger and Norton.

Staff present: David Marin, deputy staff director/communications

director; John Hunter, counsel; Rob White, press secretary; Drew

Crockett, deputy director of communications; Jaime Hjort, Michael

Layman, and Brien Beattie, professional staff members; Teresa

Austin, chief clerk; Sarah D’Orsie, deputy clerk; Tania Shand and

Mark Stephenson, minority professional staff members; Earley

Green, minority chief clerk; and Jean Gosa, minority assistant

clerk.

Chairman TOM DAVIS. Good afternoon. I want to welcome everybody to today’s hearing on Federal agencies’ continuity of operations planning [COOP].

Continuity of operations planning is the mechanism by which

Federal agencies ensure that essential Government services continue to be delivered during a major crisis that disrupts normal operations. This is a complex process involving the identification of

essential functions, the exploration of numerous emergency contingencies, and the allocation of appropriate resources to prepare for

catastrophic events.

In the stark new reality that now confronts our society, after the

attacks on the World Trade Center and the Pentagon, much has

been said and written about the continuity of Federal leadership,

including Congress. However, more important than anything that

goes on up here is the hard work that Federal employees do every

day to keep the wheels of government churning. Members of Congress don’t guard our borders; they do not deliver the mail or keep

the government’s payroll books in order. It is Federal employees

who do these things and more, and they do a spectacular job day

after day with no pomp or circumstance.

However, what happens if the headquarters of a Federal agency

or many Federal agencies is incapacitated in the aftermath of an

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attack or a major natural disaster? Federal Government agencies

need to be prepared with a plan to continue doing the most important tasks to serve the American people under any circumstances,

and it is this issue that we grapple with this afternoon.

In a hearing held by the committee almost a year ago to the day,

the Government Accountability Office reported significant inadequacies in Federal continuity of operations planning, including deficient guidance for Federal agencies in identifying their essential

functions, and insufficient allocation of resources to ensure a continued delivery of services in a crisis.

Consequently, I asked the GAO to continue to monitor Federal

COOP planning to ensure that agencies are in compliance with the

latest executive and congressional guidance and report back to us

annually. We now have the results of GAO’s first update.

In its survey of 45 Federal agencies’ COOP plans, the number of

essential functions ranged from 3 to 538. This begs the question:

If an agency has 538 essential functions, how essential can they

be? What is the priorities? Since last April’s hearing, FEMA, the

executive agency for Federal COOP preparedness, has issued updated guidance designed to better assist agencies in the identification of essential functions. The committee is interested in hearing

today about what progress has been made in clarifying this important first step in the continuity planning process.

GAO also reported the majority of COOP plans did not fully identify the mission-critical systems and data, or fully establish resource requirements necessary to maintain essential services during a crisis. GAO has cited inadequate oversight by FEMA as a

contributing factor in this problem, focusing, in particular, on the

fact that FEMA will no longer be verifying agency readiness information submitted via an on-line reporting system. However, FEMA

has told us that the on-line reporting system was never designed

to be an assessment tool, but rather to provide authorities with status reports during a crisis. FEMA has also expressed its concern

that GAO has not taken into account the field exercise that it has

conducted to test readiness.

We will be delving into these issues today to try to get at the

true state of Federal COOP planning with the goal of providing

FEMA and all Federal agencies the support they need to perform

this important function and to prepare all Federal agencies so they

can continue essential functions for our citizens in the event of disaster.

Finally, it is imperative that we incorporate telework into its

Government’s continuity planning. Telework, or allowing employees

to work from home or other remote locations, leverages the latest

technology to give significant flexibility to managers. The committee held a hearing last July on this issue, because frankly, many

Federal managers have been slow to implement telework at their

agencies. The Federal telework, mandate in the fiscal year 2001

Transportation Appropriations Act made the Office of Personnel

Management responsible for the establishment of telework policies

across all agencies by last April. This deadline was not met, and

it is unacceptable.

I look forward to hearing from OPM today what progress it has

made in encouraging telework implementation government-wide.

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This should be a no-brainer for Federal agencies. But, unfortunately, politics is like a wheelbarrow; nothing happens until you

start pushing.

A provision in the fiscal year 2005 Appropriations Act will with- hold $5 million from the budgets of several agencies if they continue to balk at telework implementation. Telework is not just common-sense efficiency, but an important national security consideration as well. The decentralization of Federal agency functions inherent in a healthy telework strategy can greatly increase the survivability of those agencies in the event of a terrorist attack or

other disruptive crisis. It can even serve to reduce traffic congestion, which, as we all know, is a major problem around here, particularly when one considers the various evacuation scenarios in

the event of a disaster in Washington.

It doesn’t take a disaster, however, to cause significant disruption of daily life in this region. I am sure we all remember what

happened when a disgruntled farmer had a bad day and decided

to park his tractor in a pond on the Mall. We need to make

progress on this.

I am pleased to note that FEMA has added some telework language in its revised COOP guidance, and I look forward to hearing

from our witnesses today about how we are translating that guidance into practice. The committee looks forward to hearing from

FEMA, OPM and GAO in the first panel on the government’s

progress in all of these areas. We will also be hearing from some

experienced private sector witnesses today on their insight into

what we in Government call COOP, and what they refer to as business continuity.

I want to once again welcome all of you and thank you for being

here today.

[The prepared statement of Chairman Tom Davis follows:]

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Chairman TOM DAVIS. I’m now going to recognize our distinguished ranking member, Mr. Waxman, for an opening statement.

Mr. WAXMAN. Thank you, Mr. Chairman.

The Federal Government’s continuity of operations planning is a

critical first step necessary to ensure its effective response to a terrorist attack, natural disaster or other catastrophe. I am pleased

that you, Mr. Chairman, are giving this issue sustained attention,

given some of the troubling reports we have from the Government

Accountability Office and others. The attention is well deserved.

If September 11 and the anthrax attacks here on Capitol Hill

were wake-up calls on the importance of effective contingency planning, this year’s Patterns of Global Terrorism report, which will be

released by the State Department tomorrow, demonstrates the continuing urgency we need to give this issue.

Early this week, I wrote to Secretary Rice urging the release of

the detailed data in this report, and yesterday the administration

did release it. The report shows a dramatic uptick in terrorist incidents in 2004. And, in fact, there were about 650 significant incidents in 2004, more than triple the 175 terrorist incidents from

2003, the previous 20-year high.

The terrorism data the administration has released should foster

a sense of urgency in Federal agencies, urgency needed to improve

their contingency plans, and which they seem sorely to need. If

September 11 was a wake-up call, then it seems some agencies

may be nodding off when it comes to contingency planning.

One of the first steps in effecting contingency planning is the

identification of the central agency functions, yet GAO reports

agencies may not be doing this basic first step effectively and thoroughly. Though there has been some recent improvement, GAO reports that the Federal Emergency Management Agency [FEMA],

has inadequate oversight over agency contingency plans. The most

troubling, FEMA apparently no longer plans to even try to verify

readiness information agencies report to it.

Mr. Chairman, these are very troubling findings which must

clearly be addressed quickly. I commend you for this hearing and

urge you to continue your efforts.

I would also like to commend my colleague, Representative

Danny Davis, for his work in seeking to improve agencies’ telecommuting policies. His legislation from last year, H.R. 4797,

would require agencies to create and evaluate a demonstration

project on telework. This is a good idea that deserves bipartisan

support.

Thank you, Mr. Chairman.

Chairman TOM DAVIS. Thank you very much.

Mr. Davis, any opening statement?

Mr. DAVIS OF ILLINOIS. Thank you very much, Mr. Chairman.

Normally I wouldn’t, but I do indeed, because I think this is such

an important discussion, and such an important topic.

Chairman Davis, Ranking Member Waxman, in the late 1990’s,

the Government Reform and Education and the Workforce Committees held oversight hearings to examine the barriers to telecommuting and the Federal agencies’ development and promotion

of telework programs.

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It was then thought that the primary benefits of telecommuting

were reduced traffic congestion and pollution, improved recruitment and retention of employees, reduced the need for office space,

increased productivity, and improved quality of life and morale of

Federal employees. These continue to be compelling and valid reasons for implementing agency-wide telework programs. Representative Frank Wolf is to be commended for moving legislation that

pushes agencies to increase the number of Federal employees who

telecommute.

However, with the Oklahoma City bombings and September 11,

we have another very compelling reason to push Federal agencies

and our staffs to develop and to implement the infrastructure and

work processes necessary to support telecommuting. It is for emergency preparedness and the continued threat of terrorism. The

question we must ask ourselves is this: In the event of an emergency, are we, this committee, our staffs, and all of the Federal

agencies, prepared to serve the American people if, in an emergency situation, our primary places of work are no longer available

to us?

You only have to read the Government Accountability Office’s

[GAO’s], updated report on continuity of operations entitled, ‘‘Continuity of Operations: Agency Plans Have Improved, But Better

Oversight Could Assist Agencies in Preparing for Emergencies,’’ to

know that the answer is no. The GAO report notes that in addition

to the threat of terrorism, severe weather conditions and environmental hazards at Federal buildings can lead to the prolonged closure of Federal buildings and can interrupt essential government

services. The report states that prudent management, therefore, requires that Federal agencies develop plans for ensuring the continuity of such services in emergency situations. These are referred

to as continuity of operations [COOP], plans. These plans lay out

an agency’s approach to maintaining services, ensuring proper authority for government actions, and protecting vital assets.

Neither the Office of Personnel Management [OPM], nor the Federal Emergency Management Agency [FEMA], the agencies responsible for providing emergency preparedness guidance in COOP,

have adequately addressed workforce considerations related to the

resumption of broader agency operations. While COOP efforts

should give priority to the safety of all employees and address the

needs of those who directly support essential operations, the resumption of all other operations is crucial to achieving mission results and serving the American people.

The GAO report states that only 1 of the 21 agency continuity

plans in place on May 1, 2004, documented plans to address some

essential functions through teleworking. Two other agencies reported that they planned for nonessential staff to telework during

a COOP event, but their continuity plans do not specifically mention teleworking.

In the next few weeks, I will introduce legislation that will push

agencies to do just that. The legislation, H.R. 4797, which I introduced last year, would require the Chief Human Capital Officer

Council to conduct and evaluate a 30-day demonstration project

that broadly uses employee contributions to an agency’s operations

from alternate work locations, including home. The outcome of the

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demonstration project would provide agencies and Congress with

approaches for gaining flexibility and identifying work processes

that should be addressed during an extended emergency. I intend

to revise the legislation to take into consideration GAO’s recommendations. I hope that you, Chairman Davis and Ranking

Member Waxman, will join me as cosponsors of this bill.

The number and types of potential emergency interruptions are

unknown, and we must be prepared in advance of an incident with

the work processes and infrastructures needed to reestablish agency operations. In a world where everything is possible, we must be

prepared for all of the possibilities.

I thank you, Mr. Chairman, for the time. I yield back the balance

of my time.

Chairman TOM DAVIS. Thank you.

[The prepared statement of Hon. Danny K. Davis follows:]

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Chairman TOM DAVIS. Members will have 7 days to submit opening statements for the record.

Are there any other Members that wish to make statements?

Mr. RUPPERSBERGER. Real quick, Mr. Chairman. Thank you for

the hearing.

During the hearing last year on this subject, we learned that

GAO found some significant deficiencies in the various Federal

agency COOP plans, and that those deficiencies were due in part

to inadequate guidance from FEMA. I was very disturbed by GAO’s

findings, because, as we all know, the Government cannot function

without reliable and realistic plans for continuity.

Now, I understand that GAO did a followup study to gauge

FEMA and agency progress as of May 1, 2004, in developing COOP

plans. I have conflicting feelings about their findings. On one hand,

I am pleased there was some improvement in the number of agencies with COOP plans, but on the other hand, it is disappointing

that two major agencies still had no plan as of May 1, 2004, and

that FEMA’s oversight was still considered inadequate.

I am encouraged that FEMA has since reissued and expanded

their Federal Preparedness Circular 65 to address GAO’s concerns

regarding their lack of guidance to the agencies. Hopefully with the

update, FPC–65, all agencies will at least have some plan on the

books. The next step is to ensure that the plans are adequate and

effective in maintaining essential government operations during a

crisis.

I am looking forward to the discussion as to how telework can

become a vital part of agency’s COOP plans. Last year I cosponsored Mr. Davis’s bill, H.R. 4797, which required a demonstration

program of conducting an agency’s operations from alternate work

locations, including employees’ homes. I think with a little tweaking, telework could become an important part of our agencies’

plans, and I look forward to hearing from the witnesses today.

Thank you, Mr. Chairman.

Chairman TOM DAVIS. Thank you.

[The prepared statement of Hon. C.A. Dutch Ruppersberger follows:]

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Chairman TOM DAVIS. Ms. Norton.

Ms. NORTON. Thank you, Mr. Chairman. I appreciate this followup hearing, because I believe, based on the GAO report, that continuing oversight is going to be necessary to get the kind of more

rapid movement that these hearings have asked for from COOP.

We do note some improvements. I think it is always important

to note improvements, because I know agencies and their employees strive to make improvements. One has to wonder why the improvements have been so slow, the improvements in such a vital

notion as making sure that the Federal Government keeps operating in the event of an emergency. I cannot help but think that one

of the reasons why is that these agencies are not in the security

business, and in essence, without a whole lot of help, they are having difficulty doing what we have asked them to do.

There is going to have to be a lot more help, a lot more leadership, in my judgment. It is simply not their expertise. You are the

ABC Agency, you are trying your best to get that done. Here comes

folks concerned, as well they might be, with homeland security and

tell you, by the way, make sure you can continue your operations,

and since you know your operations best, do it.

Well, it turns out to be harder than that. The level of detail that

the GAO report, for example, indicates is necessary in order to

really have a plan is simply not there. Many of the agencies, they

can’t tell you how many folks they would need to have on duty in

order to have continuous operations—that is a detail, that is a very

basic detail—or what kind of data, what kind of computers you

need to have. That is a harder one, because that involves secure

measures. You would have to have not only computers and data,

but you would have to know how to get to them.

Mr. Chairman, I am particularly concerned, because a lot of the

fall-out would be right here in the District of Columbia. That is

where most of the Federal employees are. That is certainly where

headquarters are, where the most essential employees are, and

where people are going to look to see if our Government is running,

if it is not running, where agencies are located here, is just not

running.

I looked at what FEMA’s responsibility is. I can only conclude

that FEMA needs help, too. And I understand that the White

House is itself giving some leadership. They need to give a lot more

leadership on this issue, especially if there is going to be any consistency here. In some cases it will not matter if one agency knows

how to keep running and another does not, because you know

what, this is one seamless government, and it will not do to have

certain agencies up and certain agencies down, and that is how the

administration has to look at it. They either are all up, able to communicate with one another, able to keep the Government working,

or if one or two of them are down, all the rest of them may be down

because of the particular function that agency serves.

Yes, at bottom it is complicated, so complicated that I don’t even

think it is fair to ask agencies to do this without a great deal of

help, and I think the two GAO reports that we have are a real indication of that.

So I look forward to hearing what has occurred and what we can

do to help improvements come about.

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Thank you, Mr. Chairman.

Chairman TOM DAVIS. Well, thank you very much.

We are going to now move to our panel. We have Reynolds Hoover, the Director of Office of National Security Coordination at

FEMA, Department of Homeland Security; Marta Brito Perez, the

Associate Director, Office of Personnel Management; and, of course,

Linda Koontz, the Director of Information Management, Government Accountability Office. Thank you all for being here.

Would you rise with me and raise your right hands. And can we

have the two people behind you state their names for the record.

Mr. SWEETMAN. Jim Sweetman, GAO.

Mr. MARINOS. Nick Marinos, GAO.

[Witnesses sworn.]

Chairman TOM DAVIS. Thank you very much.

Mr. Hoover, we will start with you.

STATEMENTS OF REYNOLD N. HOOVER, DIRECTOR, OFFICE OF

NATIONAL SECURITY COORDINATION, FEDERAL EMERGENCY MANAGEMENT AGENCY, U.S. DEPARTMENT OF

HOMELAND SECURITY; MARTA BRITO PEREZ, ASSOCIATE DIRECTOR, U.S. OFFICE OF PERSONNEL MANAGEMENT; AND

LINDA KOONTZ, DIRECTOR, INFORMATION MANAGEMENT,

U.S. GOVERNMENT ACCOUNTABILITY OFFICE

STATEMENT OF REYNOLD N. HOOVER

Mr. HOOVER. Good afternoon, Mr. Chairman and members of the

committee. My name is Reynold Hoover. I am the Director of the

Office of National Security Coordination in the Federal Emergency

Management Agency [FEMA], which, as you know, is a part of the

Department of Homeland Security. I thank you very much for the

opportunity to be here today to discuss FEMA’s role in supporting

continuity of operations programs [COOP], for the Federal Government.

As you know, FEMA was designated as the executive branch lead

agent for COOP and continuity of government programs by multiple authorities, which also requires departments and agencies to

develop COOP plans and procedures to support their essential

functions.

In our capacity as lead agent, I am proud to report that we have

provided and continue to provide a wide range of support and assistance to the Federal executive branch to develop this critical capability. This afternoon I would like to briefly highlight for you and

the committee the progress that we have made to ensure that the

Government’s ability to deliver those essential services following a

disaster from an alternate facility will be maintained.

As you may recall from Under Secretary Mike Brown’s testimony

a year ago, we published Federal Preparedness Circular 65 that

combines all previous COOP-related Federal preparedness circulars

into one comprehensive document that includes definitive guidance

on the essential elements of a viable COOP capability. But more

importantly, the FPC also incorporates many of the GAO’s previous

recommendations for COOP capability improvement, including detailed information on essential functions, the importance of interVerDate 11-MAY-2000 12:10 Jun 28, 2005 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 D:\DOCS\21468.TXT HGOVREF1 PsN: HGOVREF1
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dependencies between departments and agencies, and the identification of telework as an option for COOP planners.

In addition, we have produced a series of documents, including

templates, self-assessment tools and awareness materials, that

have been widely distributed to the interagency community and are

available through FEMA’s Web site.

As a part of our ongoing initiative to better define essential functions, and to provide a more coordinated approach to governmentwide COOP planning, we have been working with the Homeland

Security Council to help identify department and agency primary

mission essential functions that support eight national essential

functions identified previously by the Homeland Security Council.

As a result of this initiative, we expect to incorporate those national essential functions into the Department’s primary mission

essential functions in future planning and exercises.

But our COOP coordination responsibilities are not limited to the

national capital region. In fact, we have established numerous

interagency working groups at the headquarters and regional level.

The centerpiece of this effort is the COOP Working Group in the

National Capital region that is comprised of 76 departments and

agencies, and has members as planners from the legislative branch,

the judicial branch and the District of Columbia.

At the regional level, FEMA has established COOP working

groups with the assistance of GSA and OPM that support many of

the Federal executive boards and Federal executive associations

across the country.

Because training readiness is a key to COOP preparedness, we

believe exercises are critical to identifying, assessing and correcting

COOP plan and program deficiencies. In that regard, we have been

concentrating on building a national COOP exercise program, and

as you know, Mr. Chairman, in May of last year, we conducted Exercise Forward Challenge 2004, the first-ever, full-scale COOP exercise for the Federal executive branch.

Today we have already begun preparations for Forward Challenge 2006, which will be an externally evaluated exercise. Our

support, however, for COOP exercises extends beyond the Washington, DC, area, and in partnership with GSA, our FEMA regions

have conducted and will continue to conduct interagency COOP exercises nationwide.

The foundation of this exercise program is a robust training component, which has been a primary focus of FEMA. Working in close

collaboration with OPM, GSA and the COOP Working Group, we

have developed and delivered the COOP Managers Training course,

in a train-the-trainer-type format, and I am proud to say that as

of March of this year, all 30 major departments and agencies have

participated in the training courses that we have delivered across

the Nation. In fact, a total of 682 Federal, State, local and tribal

officials have been trained and certified as COOP instructors. An

additional 41 course offerings will be coordinated across the country by the end of this fiscal year.

Recognizing the GAO’s concerns for FEMA to take a greater role

in assessments, and realizing a need to better understand COOP

alternate facility requirements, we have been conducting Federal

department and agency alternate facility site visits to provide an

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assessment of current capabilities and identify common issues facing COOP relocationsites. Through these site assessments, we will

be in a better position to address and coordinate planning and preparedness needs for departments and agencies.

Mr. Chairman and members of the committee, let me conclude

by saying I believe that FEMA, in our role as the lead agent for

the executive branch continuity of operations and continuity of government programs, and the Department of Homeland Security has

significantly enhanced the Federal Government’s preparedness to

perform its essential functions across the full spectrum of all hazards, threats and emergencies. Working with our partners throughout the government, we will continue our leadership role by providing planning and programming guidance, conducting exercises and

assessments, developing resource capabilities, and building the relationships necessary to ensuring an effective government-wide

COOP program that is coordinated and responsive to any threat or

emergency.

Thank you for your time, Mr. Chairman. I look forward to your

questions and the questions of the committee.

Chairman TOM DAVIS. Thank you very much.

[The prepared statement of Mr. Hoover follows:]

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Chairman TOM DAVIS. Ms. Perez, thanks for being with us.

STATEMENT OF MARTA BRITO PEREZ

Ms. PEREZ. Good afternoon, Mr. Chairman. Good afternoon,

members of the committee. I am very pleased to be here representing the Office of Personal Management. I appear to you today to

discuss the Federal agencies’ use of telework and its inclusion in

Federal agencies’ continuity of operations planning.

It is my responsibility at OPM to work with the agencies to ensure that they have focused their attention on this critical aspect

or their continuity of operations. The committee has been consistent in emphasizing the importance of telework and its significant

benefits, particularly following the tragic events of September 11.

I am pleased to report to you that OPM has played an important

role in helping agencies recognize the need of emergency planning,

as well as the need for incorporating telework in their COOP plans.

It is, in fact, a reality that since September 11th, telework has

become a matter of necessity for many employees and employers.

While you and other Members of Congress have long recognized the

need and the benefits of telework in reducing traffic congestion and

air pollution, in addition to positive impacts on employee morale

and retention, we have all come to recognize the important role

that telework plays in an agency’s ability to continue to perform

mission-critical work in times of crisis or calamity.

Using a train-the-trainer approach, OPM has partnered with

FEMA to deliver human capital-oriented emergency preparedness

training to agency COOP managers. Thus far we have provided

training in each of FEMA’s 10 regions. This ongoing FEMA-sponsored COOP training includes an OPM segment on the various

human capital tools that are available to Federal planners through

their human resources efforts and the staff to secure and to ensure

the continued operations of Federal agencies during a crisis.

Telework is identified in the training as one of those tools for emergency planners to use in developing schemes to leverage the capability of the Federal workforce during times of crisis and disruption.

Since, after September 11, OPM began working with the Federal

executive boards to improve communication capability with special

emphasis on emergency preparedness. In 2002, OPM identified

emergency planning as an integral component of human capital

management. In 2003, OPM administered the first annual emergency preparedness survey to assess the extent to which agencies

were considering emergency planning, shelter in place, securing the

workforce, with particular attention to those with special needs, as

well as to look at the use of flexibilities and tools that were available to managers.

Following the completion of the survey, OPM held several briefings in Washington, DC, to share the results with the senior managers and representatives from around the agencies.

As you know, Mr. Chairman, the Federal Government is geographically dispersed. Approximately 90 percent of the executive

branch employees work outside of the Washington, DC, metropolitan area, and as such, OPM has been working with the Federal executive boards across the country to deliver an emergency preVerDate 11-MAY-2000 12:10 Jun 28, 2005 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 D:\DOCS\21468.TXT HGOVREF1 PsN: HGOVREF1
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paredness training to Federal employees throughout the Federal

Government.

Since October 2004, 22 training sessions have been held, focusing

on the human capital tools that are available to Federal organizations and their emergency planning. Again, as part of that training,

OPM emphasizes the importance of a strong telework plan to provide Federal agencies the capacity to employ its workers outside of

their normal workplace when emergency circumstances dictate.

Today over 20 agencies have participated in our training. To our

cadre of human capital officers at OPM, we provide hands-on, oneon-one assistance to the agencies as well. On numerous occasions

during the past year, OPM has provided consultation and support

to agencies challenged by weather and traffic disruption. Certainly

we have had a number of events in the Washington area where we

have supported our agencies.

In summary, Mr. Chairman, OPM has been a leading advocate

of the need to better prepare a Federal workforce in order to cope

with any possible crisis which could affect Federal workers and

government operations. In addition, we are grateful for the attention that this committee has directed to Federal agency’s COOP

plans, with over 1.8 million nonpostal executive branch employees

spread across the agencies, each with a distinct and important mission.

We simply must incorporate employee safety with business

needs. OPM’s goal is to make telework an integral part of the agency operations, rather than a new or special program. I am sure

that—I assure you that OPM will continue to champion telework

as a key human capital strategy and do everything that we can to

facilitate, to educate, to guide the incorporation of telework into the

agencies’ overall operations and emergency preparedness planning

and use.

Thank you. And I will be happy to answer any questions.

Chairman TOM DAVIS. Thank you very much.

[The prepared statement of Ms. Perez follows:]

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Chairman TOM DAVIS. Ms. Koontz.

STATEMENT OF LINDA KOONTZ

Ms. KOONTZ. Mr. Chairman and members of the committee, I appreciate the opportunity to participate in the committee’s hearing

on Federal continuity of operations planning.

As has been discussed, a range of events can interrupt essential

government services, and so Federal agencies are required by Presidential Decision Directive 67 to develop plans for ensuring the continuity of such services in emergency situations. This directive designates the Federal Emergency Management Agency as executive

agent for executive branch continuity of operations planning, and

FEMA has issued planning guidance to agencies.

About a year ago we testified before this committee on agency

compliance with FEMA guidance. At that time we stated that a

number of agencies did not have continuity plans in place as of October 1, 2002. Further the essential functions identified in those

plans varied widely in type and number, and the plans generally

did not comply with FEMA’s guidance.

Since that time the executive branch has taken a number of important steps to improve continuity planning across government.

These are fully discussed in the report we did at your request, and

that is being released today. Specifically, since our last review,

FEMA has issued a new version of its guidance that provides additional needed detail on each of the planning areas, including the

identification of essential functions.

In addition, the White House has issued guidance on essential

functions and initiated the process to identify and evaluate agencylevel functions. In doing so, the White House noted that in the

past, many departments and agencies have had difficulty in clearly

identifying and articulating their essential functions, which are the

foundation of effective continuity planning. This is a condition we

recognized in our prior and subsequent reviews of agency continuity plans. However, while the White House efforts should improve

the identification of essential functions, the lack of a schedule to

complete this effort makes it unclear when these improvements

might take place.

You also asked us to look at the Federal plans in place as of May

1, 2004. We found that agencies had made progress in improving

compliance with FEMA’s guidance, particularly in the area of tests,

training and exercises. In addition, all but one of the agencies reviewed now has a plan in place.

However, significant weaknesses remained. For example, 31 of

45 plans did not fully identify mission-critical systems and data

necessary to conduct essential functions. In our prior review of

2002 plans, we noted that insufficient oversight by FEMA contributed to agencies’ lack of compliance with the guidance. FEMA has

since improved oversight by conducting an interagency exercise in

May 2004, and providing training to key Federal, State and local

personnel. FEMA also plans to collect information from agencies on

their readiness, but does not plan to verify this information.

Finally, you asked us to what extent agency plans address the

use of telework during emergencies. We found that although FEMA

guidance was in place as of May 2004 it did not address telework,

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one agency’s plan included telework as part of its continuity strategy. Also 10 others reported that they planned to use telework, but

these plans were not clearly documented.

Since then FEMA’s new guidance directs agencies to consider

telework in continuity planning. However, the guidance does not

address the steps that agencies should take to ensure they have

made preparations necessary to use telework effectively in an

emergency situation.

In summary, Mr. Chairman, FEMA’s revisions to its guidance

and the White House effort have the potential, if effectively implemented, to help agencies better identify their essential functions

and thus develop better continuity plans. In addition, agency continuity plans are slowly improving. Finally, agencies appear to be

making increasing use of telework in their continuity plans. However, we think there are further opportunities to ensure preparedness. Consequently, in our report that is being released today, we

are recommending that a schedule be established for the White

House effort, and that FEMA further improve its oversight of agency continuity plans by verifying that these plans are indeed fully

compliant with the guidance.

In addition, we are recommending that FEMA, in consultation

with OPM, develop more detailed guidance on telework. With executive branch progress to date and the additional steps we have recommended, as well as continuing oversight by this committee, we

believe that the Federal Government can ensure that it is fully prepared for emergencies.

Thank you. That concludes my statement. I would be happy to

answer questions.

Chairman TOM DAVIS. Well, thank you very much.

[The prepared statement of Ms. Koontz follows:]

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Chairman TOM DAVIS. Mr. Hoover, throughout your testimony

you characterize FEMA’s role in the COOP planning process as

lead agent and advisory assistance, to resource and providing training. Doesn’t some agency have to exercise comprehensive authority

and control over all of the other agencies to compel compliance, and

who should that be?

Mr. HOOVER. Well, yes, Mr. Chairman, we are the lead agent,

and in that capacity we work very closely with all of the departments and agencies. And I think we have made significant strides

in ensuring that departments and agencies are compliant with the

COOP guidance that we have put out as well as the most recent

guidance that came out from the Homeland Security Council with

regard to the national essential functions. And we think that in

combination with the efforts and the support that we are getting

from the Homeland Security Council, we are making great improvement, and that the guidance that we have now and the role

and responsibilities we have now are sufficient to get departments

and agencies moving forward in the right direction.

Chairman TOM DAVIS. I have heard it said that data is the one

resource that once it is lost can’t be recovered. I know that sounds

cold and unfeeling, but it does highlight the importance of maintaining security back-up systems.

If Wall Street loses its financial records, they are gone forever,

and the result would be financial chaos. Similarly, if the government loses its vital data, it would have profound consequences for

the security of the country, and government is behind the private

sector because it doesn’t have the same market pressures on it.

This school of thought, therefore, advocates a datacentric approach

of continuity of operations planning.

Let me ask GAO to comment on its views of the Federal Government’s efforts to back up and secure its data, and then ask FEMA

and OPM how they are working to secure this important resource.

Ms. KOONTZ. Well, I think that, in general, we can say that the

vital records area, which is ensuring that you have the information

that you need in order to perform essential functions during an

emergency, was probably one of the weaker areas that we looked

at when we evaluated continuity plans as of May 1, 2004.

Chairman TOM DAVIS. Can you give an example, something that

if it really—as of that date, if it were lost, could be a severe problem?

Ms. KOONTZ. There are many things in the Federal Government

that I am sure that if they were lost would be very valuable, including all kinds of files involving recipients of benefit programs

across the government, any data dealing with economic health of

the agency. I could not even begin to enumerate all of the different

kinds of information that is so valuable, if it were lost, it would be

disastrous.

Chairman TOM DAVIS. OK. Let me just ask FEMA and OPM how

you are working to secure these resources.

Mr. HOOVER. Thank you, Mr. Chairman. One of the things that

is in the new revised guidance for Federal Preparedness Circular

65 is an area that deals specifically with vital records and functions. Certainly if you go to an alternate facility and don’t have

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reach-back capability to those vital records and functions, as you

mentioned, you won’t be as effective as you could be.

So we put out guidance to the departments and agencies, and we

help them implement that guidance by ensuring that they have the

back-up capability and they have redundant capability not only in

communications, but also in maintaining vital records and having

that reach-back capability.

We are working with departments and agencies to improve that.

We have recognized that is an area that needs to be fixed across

the government, and I think we are making some improvement in

that area.

Ms. PEREZ. Mr. Chairman, I will speak, obviously, from an OPM,

an agency perspective in terms of having its own information and

data backed up, but I can tell you that we are certainly following

the guidance that is—the FEMA guidance, and that OPM does

have all of its data, retirement information and so forth, backed up.

So we feel comfortable that we have met all of their requirements

and the guidelines.

Chairman TOM DAVIS. The GAO study revealed—Ms. Perez, this

is for you. The GAO study revealed that 19 of 23 agencies surveyed

have a telework policy in place, but only 1 of the 19 agencies had

their telework policies play a role in COOP. Why this disconnect?

Ms. PEREZ. Yes. In fact, Linda and I had a conversation prior to

the beginning of the hearing, Mr. Chairman, and frankly, we

have—since we survey the agencies on a regular basis, we did a

survey in 2003 and 2004, and just surveyed them again in 2005.

And I think our data may be a little more current than perhaps

what—the GAO information.

All of the agencies, with the exception of one, currently have a

policy, a telework policy, in place. The response that we are getting

from the agencies with regards to how many of them are actually

using telework as a flexibility in their COOP operations, it is a little bit higher than that. We actually surveyed about 65 agencies.

We have—about 35 percent of agencies say they have—they are

using telework as a flexibility on a situational basis. About 40 percent of the 65 agencies said that they actually have COOP as a permanent part—telework as a permanent part of their COOP planning. So I think that it may be the timing of the survey. Our data

indicates that agencies continue to make progress, and that they

are doing probably a little bit better than perhaps when the data

was collected by GAO.

Chairman TOM DAVIS. In the written testimony on our next

panel, Julie Williams from Cisco says the one of the keys to success

of Cisco’s telework policy is it has provided 100 percent reimbursement on the cost of broadband services to the employees’ homes of

up to $75 a month. Federal Government currently reimburses

workers up to a $100 a month for commuting costs like Metro.

Is employee reimbursement for broadband service an idea the

Federal Government could pursue?

Ms. PEREZ. Certainly. We have left up to the agencies what policies they use in terms of implementing what is reimbursable. The

Federal Government does not have currently the capability, I don’t

think, of reimbursing for personal expenses. So I think that is

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something that would have to be looked into. Is it a good policy or

not would have to be considered.

Chairman TOM DAVIS. You would have no objection to individual

agencies having that discretion, I gather, if we gave it to them?

Ms. PEREZ. I think that it would be entirely up to—somebody

would have to analyze the costs and so forth and see whether it

makes sense in the context of the agency’s operations.

Chairman TOM DAVIS. It wouldn’t be every employee, but certainly for some employees. I mean, you talk about continuity of operations and the like. It seems that would be something that we

might be interested in looking at.

Ms. PEREZ. Certainly something that would be worth considering.

Chairman TOM DAVIS. Thank you very much.

Mr. Davis.

Mr. DAVIS OF ILLINOIS. Thank you very much, Mr. Chairman.

Mr. Hoover, do you expect FEMA’s June 2004’s guidance to improve the agency COOP plans?

Mr. HOOVER. Yes, sir. Thank you for that question. We think

that the guidance that we put out is a significant improvement

over previous guidance that had been developed before September

11th. In fact, we combined three Federal preparedness circulars

that were previously out on the COOP subject.

We included in this Federal preparedness circular that we released in June a section on human capital management that OPM

helped us on. We included an annex in there on alternate facility

site selection that the GSA helped us on.

So we think that the new guidance that was put out, in addition

to the most recent guidance on the eight national essential functions, and we have asked departments and agencies to identify

their primary mission-essential functions that support that, are all

things that will help improve the Government to be prepared to

perform its essential functions from alternate facilities.

Chairman TOM DAVIS. It seems as though some agencies have

made less progress than other agencies; that is, some seem to be

moving further ahead than others. Would you hazard a comment

as to why some seem to be doing better than others?

Mr. HOOVER. Well, I think that is a fair assessment that some

departments and agencies are moving quicker than others in regard to making sure that they have all of the elements of a viable

COOP plan in place. But I would say that on whole, if we look at

the 76 departments and agencies that are involved in our COOP

Working Group, which are most of the major departments and

agencies in the National Capital region, and certainly out in the regions as well, they are all making improvements in their COOP

planning and preparedness, and folks have really taken an important renewed emphasis on COOP planning and COOP readiness.

Mr. DAVIS OF ILLINOIS. Do you think that there is anything that

will help to spur them on or cause them to intensify, perhaps, their

efforts?

Mr. HOOVER. I think one of the most important things that has

helped reinforce the importance of continuity operations and/or

COOP programs has been the emphasis that the Homeland Security Council has placed on it. And with issuing the guidance with

regard to primary mission-essential functions, we think as we finVerDate 11-MAY-2000 12:10 Jun 28, 2005 Jkt 000000 PO 00000 Frm 00064 Fmt 6633 Sfmt 6633 D:\DOCS\21468.TXT HGOVREF1 PsN: HGOVREF1
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ish that review of the submissions that we have from all of the

major departments and agencies in the National Capital region, as

we finish that review, we will be able to even provide more refined

guidance for COOP planning and make us in a better position

again to deliver essential functions in the event of an emergency.

Mr. DAVIS OF ILLINOIS. Ms. Perez, a witness on the next panel,

Kevin Luten, will testify that the Federal Government lags behind

the private sector in the Washington region when it comes to telecommuting.

The 2004 state of the commute by the Washington, DC, Council

of Governments found that 15 percent of private sector employees

teleworked, compared to only 12 percent of Federal employees. As

of today does the Federal Government have a functioning telework

program in place that would sustain an agency operation during an

extended emergency?

Ms. PEREZ. Well, the Federal Government—it is a big organization, sir. I would say that agency by agency it differs in the quality

and the extent to which they are prepared to use telework as an

alternative flexibility in deploying their workforce.

With regards to why they use it and how they do not use it, I

think that the Federal work continues to educate them. We provide

a lot of guidance. Agencies continue to attend our briefing sessions.

We have a quarterly event that we hold. We get a lot of questions

from the agencies, and I think they are continuing to try to get better at this.

There is still some reluctance in the way that our managers

sometimes view telework. If we can’t see them, we can’t touch

them, they may not be working as hard as we want them to work.

But I think with continuous education and guidance from FEMA

with regards to using it, and OPM as a tool for emergency planning, it could continue to grow. But it varies from agency to agency, sir.

Mr. DAVIS OF ILLINOIS. Ms. Koontz, based upon the information

that you have, does it appear from just your observation that there

is a high level of serious intent or seriousness or feeling of need to

seriously pursue this kind of activity?

Ms. KOONTZ. I believe that with the recently initiated White

House effort, and the attention that they are placing on creating

a framework for identifying agency-level essential functions, I

think we now have the sense of urgency and the intention that we

need to get this done.

Mr. DAVIS OF ILLINOIS. Thank you very much, Mr. Chairman.

Chairman TOM DAVIS. Thank you.

Just have another question or two for this panel.

Mr. Hoover, in your testimony you highlighted the establishment

of the COOP Working Group, a Federal, State, and a local forum

for the National Capital region designed to assist the executive

branch in COOP capability development. Is Metro included in this

working group?

Mr. HOOVER. Yes, Mr. Chairman. The District of Columbia has

a representative, as well as the legislative branch and the judicial

branch participate. And that group meets every month to discuss

COOP planning, and other COOP-related issues.

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Chairman TOM DAVIS. So it is safe to say that this signals

FEMA’s view of the central role of Metro in the National Capital

region’s preparedness.

Mr. HOOVER. Yes, sir.

Chairman TOM DAVIS. What can be done to ensure that Metro

is a full partner in COOP preparedness?

Mr. HOOVER. Well, I would say that they are. And the fact that

they attend our monthly COOP Working Group meetings, and certainly the efforts within the Department of Homeland Security’s

National Capital Region office, we have been working on issues

such as evacuation and credentialing, and the D.C. area is very

much a part of that.

Chairman TOM DAVIS. OK. Thank you all very much. I appreciate it. We will take a 2-minute recess as we move our next panel

ahead.

Our next panel consists of James A. Kane, the president and

CEO of Systems and Software Consortium, welcome him back;

Julie Williams, a director of the Internet Business Solutions Group

in the Federal Civilian Agency Practice, Cisco Systems; and Kevin

Luten, the public policy representative at the Association of Commuter Transportation.

We will recess for just a couple of minutes.

[Recess.]

Chairman TOM DAVIS. The meeting will come back to order. Are

you ready to be sworn in? If you would stand up, I will swear you

in.

[Witnesses sworn.]

Chairman TOM DAVIS. Thank you. We will start.

Dr. Kane, I will start with you. We will go straight down and try

to limit it to 5 minutes. I think you know the rule. Then we will

go right to questions. Thank you.

STATEMENTS OF JAMES A. KANE, Ph.D., PRESIDENT AND CEO,

SYSTEMS AND SOFTWARE CONSORTIUM; JULIE WILLIAMS,

DIRECTOR, INTERNET BUSINESS SOLUTIONS GROUP, FEDERAL CIVILIAN AGENCY PRACTICE, CISCO SYSTEMS; AND

KEVIN LUTEN, PUBLIC POLICY REPRESENTATIVE ASSOCIATION OF COMMUTER TRANSPORTATION

STATEMENT OF JAMES A. KANE, Ph.D.

Mr. KANE. Thank you. Mr. Chairman, members of the committee,

distinguished guests and committee staff members, thank you for

inviting me here today to provide insights on the importance of

telework and continuity of operations planning.

I am Jim Kane, president and CEO of the Systems and Software

Consortium. The role of the Consortium and its relationship to

your interest and support, Chairman Davis, and to Representative

Frank Wolf’s initiatives through the Telework Consortium are described in my written submission, so in the interest of time, I will

proceed to the major points of my testimony.

I am pleased to be here today to offer two key insights as inputs

to the committee’s deliberations and to offer two modest recommendations I believe can significantly contribute to the success

of telework-based solutions in continuity of operations plans. My

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first insight corresponds to the committee’s interest in the respective roles of OPM for implementing telework programs and for

FEMA’s role in continuity of operations. My first insight is to ensure that these agencies are clear on the concept of telework.

The phrase ‘‘telework’’ as used by OPM and GAO is referred to

by them as telecommuting and/or flexiplace. It conveys the image

of a solitary worker remotely connected to a central work site. This

is in dramatic contrast to the more contemporary concept of

telework, which embraces spatially distributed work teams using

high-bandwidth telecommunications to perform routine business

activities.

Contemporary telecommunications is taking the ‘‘place’’ out of

the word ‘‘workplace.’’ If you doubt that, walk through an airport,

walk through your neighborhood Starbucks. Are these people telecommuting or are they simply working in a more contemporary

way? Accordingly, this committee’s concern should not be merely

whether an agency has telework in their continuity of operations

plans, but rather whether the guidance being provided reflects

what is now possible using contemporary practices for telework.

If past is prologue in this area, yes, we will have guidance on

telework as an element of continuity of operations planning, but it

will be equivalent to having guidance on how to adjust the rabbit

ears on your TV set to get those three channels of network television.

My second insight is offered from the perspective of the committee’s interest in the plans of individuals for incorporating telework

in their continuity of operations plans.

Pilot deployments of telework solutions are essential for successful large-scale implementations. Against that backdrop, I refer you

to the GAO report of July 2003 and, specifically, to figure 1 on page

5 of that report. The figure lists 25 key telework practices for implementation of a successful Federal telework program, yet nowhere on this list does it say anything about actually implementing

pilot projects as a key success factor. It is as if you have the cookbook, you have the ingredients, but you never cook the meal.

We at the Telework Consortium have learned that pilot projects

are essential. They enable us to ensure that the appropriate technology is deployed and that adequate resources are in place. But

even more important is that pilots enable the participants to see

and experience what is now possible. It is the behavior of people

more than the performance of technology that enables teleworkbased solutions to support agency missions whether in normal

times or emergency operations. Therefore, in evaluating GAO reports as to whether telework and continuity of operations plans are

coordinated, the real issue is not whether they are on paper, but

whether they have been tried in practice.

The committee should not place false confidence in the few agencies that have at least coordinated telework in their continuity of

operations plans. If the agency is not already running pilots, confidence in that agency’s ability to support continuity of operations

could be misleading.

In closing, let me offer two modest recommendations. First, leverage what you already have in place and have invested in. Despite

the continued interest and personal efforts of yourself, Chairman

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Davis, and Representative Wolf, agencies, with few exceptions, are

not taking advantage of the Telework Consortium as a resource. I

would recommend to the committee that agencies use the Telework

Consortium as a resource for their telework programs to ensure

they are getting maximum benefits from the pilot projects they

should be conducting.

My final recommendation is that I would again, as in my previous appearance before you, encourage you to consider a National

Center for Distributed Work. We are now experiencing a technology

revolution that will affect how government agencies operate. A national center could focus on pilot implementations of contemporary

telework-based solutions in a continuity of operations environment.

This could provide valuable insight to both government and industry on how to ensure an increasingly safe, adaptive and productive

work environment.

In closing, I again thank you, Mr. Chairman, and the entire committee for allowing me to share my perspectives on telework with

you today. I would be happy to answer any questions.

Chairman TOM DAVIS. Thank you very much.

[The prepared statement of Mr. Kane follows:]

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Chairman TOM DAVIS. Ms. Williams, thanks for joining us.

STATEMENT OF JULIE WILLIAMS

Ms. WILLIAMS. Thank you, Chairman Davis, Ranking Member

Waxman and other distinguished Members. Thank you for this opportunity to testify today regarding Cisco’s experience with business continuity planning and the importance of telework as a key

enabler of our strategy to provide highly available, responsive, secure and essential business operations.

My name is Julie Williams and I am the director of our Federal

civilian agency practice for Cisco’s Internet Business Solutions

Group. So today I will focus my comments on Cisco’s experience

with our business continuity planning and the important role that

telework plays in enabling that continuity strategy.

As a publicly traded company, Cisco has a corporate responsibility to its shareholders to maximize shareholder value in all areas

of the business. Ensuring business continuity is a critical element

of that shareholder responsibility. The company is responsible, in

order to do this, to maintain a continuous operating infrastructure

to support its financial systems and controls. To accomplish this,

Cisco has established a robust business continuity management

framework that defines the key elements for uninterrupted access

to mission-critical corporate data and resources in the event of a

natural disaster, homeland security threat or other significant

interruption.

That framework contains four layers beginning at the bottom

with network resilience. The other three layers, in order, are application resilience, communications resilience, and finally, workforce

resilience. It is this top layer and last layer, the workforce resilience layer, that provides the capabilities for employees to remain

fully connected to enterprise communications and applications systems even if they cannot report to their normal work location.

Each layer of resilience depends on those layers beneath. That is,

it is impossible to achieve workforce resilience without a foundation

of resilient communications, and it is impossible to provide resilient

communications without basing it on a resilient network infrastructure and applications.

In our experience, many organizations, to date, have focused on

optimizing the network application and communication layers and

have largely ignored that workforce layer in their BCM planning.

So we have invested heavily as a company in this top layer through

focused development of employment tools and teleworking policies.

These tools and policies allow us to conduct business anytime and

anywhere in the event of significant interruptions, and are critical

to maintaining our shareholder value.

A key element for success is Cisco’s corporate Internet, our Cisco

Employee Connection. CEC provides the foundation for our corporate information and processes worldwide. It gives employees 24-

by–7 access to the tools, information and applications they need to

be effective and contribute to our bottom-line revenue-generating

activities. In effect, CEC becomes just another work location such

as a cubicle, a remote branch or a coffee house.

So I would like to give you some ideas of many of the tools and

applications that our employees access via CEC, and these are

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what we consider our essential functions which are critical to running the business. For example, our employees and executives can

enter and process all of our customer orders; track up-to-theminute performance data, including our bookings data, revenue

and operating expenses; record, distribute and play critical video

and audio communications; and the like.

So where does telework fit into this equation? Teleworking is essential to our continuity of operations plan as it enables access to

these critical tools and processes. Many organizations overlook this

top element of that workforce resilient layer and, instead, focus on

the remaining layers. The events of September 11 and subsequent

anthrax threats taught the world that continuity planning must extend beyond the physical buildings and allow workers to connect

from anywhere they may be in order to begin planning through and

recovering from disruptions.

With this highly available foundation of networks and applications and the ability to have real-time video connectivity with

peers, coworkers and management, Cisco employees with virtual offices feel less need to be attached to the Cisco office location and

spend more time with customers and partners.

Over 90 percent of Cisco’s employees telework 1 to 2 days a

week, and this productivity has generated significant financial benefits for our organization. Through our experience, deploying business continuity solutions, as well as helping other government and

private-sector organizations deploy these same successful programs, we have found that there are several key underlying factors

that need to be in place to enable this.

The first is to migrate much of the organization’s business activities and processes to paperless activities, make application tools

available to support access and operation in a digital mode, ensure

full access to all of those assets from remote locations, develop a

cultural migration plan for the organization to accept individuals’

becoming remote individual contributors; and this, in turn, requires

that we define and capture new metrics to allow the management

process to take place on a virtual basis.

Finally, we feel that allowing the monthly reimbursement of

Internet service provider access for teleworking is a key to our internal success. And in our experience with Federal organizations to

date, the flexibility to reimburse employees for this broadband

service cost, similar to the method for reimbursing more traditional

commuting expenses like Metro, will be essential to increasing the

adoption of telework and tele-COOP across government.

So, in summary, I would like to mention that the U.S. Federal

Government has publicly affirmed its responsibility to its citizens

by putting into place a plan for sustaining a Constitutional form

of government through any disruption. The continuity of operations

is the means by which government plans to fulfill this responsibility, just as Cisco’s business continuity management initiative is the

means to fulfill our responsibility to our shareholders and employees. We each need the deployment and integration of all four layers

in the business continuity model and framework to support the

needs of this displaced workforce, and we need to support swift

movement toward a true paperless government to help maximize

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the impact of the tools and processes we employ to manage the Nation.

I would like to thank you, Mr. Chairman, and other committee

members for inviting me here today; and I am pleased to answer

your questions.

Chairman TOM DAVIS. Thank you very much.

[The prepared statement of Ms. Williams follows:]

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Chairman TOM DAVIS. Mr. Luten.

STATEMENT OF KEVIN LUTEN

Mr. LUTEN. Mr. Chairman, members of the committee, thank you

very much for the opportunity to participate in this dialog on the

role of telework in the Federal workplace concerning continuity of

operations planning.

My name is Kevin Luten. I am the planning director of Urban

Trans consultants, a national transportation management consulting firm; and I am here representing the Association for Commuter

Transportation [ACT], as their Washington regional public policy

representative.

I can also say that I am a full-time teleworker, and perhaps Dr.

Kane has run into me at Starbucks on Pennsylvania just a few

blocks from here. So I am familiar with the dynamics.

Before I start, I would like to express ACT’s appreciation to

Chairman Davis and the rest of the committee for holding this

hearing. Chairman Davis’ commitment to a secure and efficient

government is exemplified by his actions and this hearing. It is this

commitment and dedication that will be needed in order to ensure

that the Federal Government continues essential operations in the

event of an emergency, natural or otherwise, large or minor.

The members of ACT represent a broad coalition of organizations

from major private-sector businesses and institutions to State and

local transportation agencies. But we all have one thing in common. We are all working cooperatively to make transportation work

better by making it more efficient and less costly, for government,

communities, businesses, families and individuals. This means

helping businesses and communities balance needed infrastructure

improvements with complementary investments in the programs

and policies that address the demand side of the transportation

equation.

ACT and its members have been very involved with regional

planning agencies on emergency management planning. There are

a number of different ways that demand side strategies can play

a role in emergency situations. A key element of this equation is

teleworking. Whether it is home-based or remote office-based, teleworking moves the work to the employee rather than moving the

employee to the work.

I would like to offer a few examples of the different ways that

teleworking is increasingly important to businesses, talk specifically about the role of teleworking as a strategy for emergency preparedness, and offer some lessons learned from the private sector

that can help guide Federal policy and program implementation.

Companies implement telework programs, as you know, for many

reasons, including increasing productivity, decreasing facility cost

and facilitating expansion, increasing employee productivity and

improving employee morale and improving labor recruitment and

retention. In short, companies are pursuing aggressive telework

programs to enhance productivity and economic competitiveness.

These companies recognize that the extremely fast pace of change

in computing and information technology is fundamentally changing the way that many companies do business and compete in today’s global economy.

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Adapting to and incorporating these technological advances into

all aspects of business operations from how people work to where

they work to when they work is increasingly critical to maintaining

competitiveness. In one example, AT&T, a large number of employees are permanently moving out of traditional offices and into virtual offices. AT&T is pursuing a fundamentally new corporate

strategy by building operations that are net centric instead of

building centric. Essentially, they are organizing operations around

networks instead of buildings.

AT&T, in 2003, had 17 percent of their managers working fulltime in virtual offices and 33 percent of managers working at least

1 day a week in remote offices. As Congressman Davis noted, in

the metropolitan Washington COG’s 2004 State of the Commute report, it found that 15 percent of employees at private-sector companies in the Washington region are teleworking today versus 12 percent of Federal workers.

AT&T’s network-based structure is expected to generate over

$150 million in benefits to AT&T by increasing productivity, reducing overhead costs such as real estate and enhancing recruitment

and retention.

Productivity gains are perhaps the most significant but least understood benefit of telework. AT&T teleworkers have consistently

reported gaining about 1 extra hour of job-based productive time

each day when working at home. Essentially they redirect the majority of their commuting time, on average 80 minutes a day, into

work activities.

How does this relate to telework and emergency preparedness?

Increasingly, companies are finding that teleworking is not only an

effective business strategy, but helps address issues such as improving retention, reducing facility cost and increasing productivity. But also it is essential in preparing for and recovering from

emergency situations.

My company is currently helping the Tampa Bay Regional Planning Council in Florida to help companies develop pilot telework

programs as a key part of their emergency preparedness planning.

In the aftermath of last year’s hurricane season, Florida is emerging at the forefront of using telework to maintain business and

community operations in the wake of natural disasters. These programs can keep companies running, keep communities functioning

and greatly reduce the larger economic hardships imposed by these

events.

A few lessons learned from Florida are that, one, telecommunications infrastructure tends to be more robust and include more redundancy than our roadway infrastructure; second, that organizations with established remote access programs were more resilient

than those that did not have established programs; and most importantly, preplanning is key to quick response and quick recovery.

Lessons from the private sector and from areas hit hard by natural and man-made disasters in the past lead our organization to

urge the Federal Government to continue to speed its implementation of telework for all employees and to focus on advanced planning in order to fully utilize telework as a core element of contingency planning for Federal agencies.

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Just a couple of specific recommendations: abundant

preplanning, including the use of pilot programs for the integration

of telework into contingency planning at all Federal agencies; increasing education for managers and executives; providing adequate resources to develop and implement telework capabilities; reissue, clarify and assert the Federal standards for telework eligibility; and the last two comments, to explore other demand-side

strategies such as ride-sharing and the use of mass transit options

in addition to telework as part of contingency planning.

Last, I would encourage you, Mr. Chairman, to explore the reimbursement of telework office and connectivity expenses as part of

a pretax arrangement. ACT has been actively involved in those

pretax arrangements for both transit and van pooling in the past

and continues to support those activities.

Thank you, Mr. Chairman.

[The prepared statement of Mr. Luten follows:]

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Chairman TOM DAVIS. Well, thank you all very much. That was

very useful testimony.

Let me ask anybody, are there any specific Federal Government

departments or agencies that currently have telework policies that

you would recommend?

Mr. KANE. Yes. TIGTA at Treasury, the Treasury Inspector General Tax Administration, they have been one of the pilots we have

worked with over the years, and they are clearly out in front. Very

impressive.

Chairman TOM DAVIS. Anybody else want to offer up any?

Ms. WILLIAMS. Yes, Mr. Chairman. We are currently working

with two to three agencies right now on some demonstration

projects.

Chairman TOM DAVIS. Dr. Kane, in your testimony, you emphasized a more contemporary concept of telework that is really different from GAO’s concept of telework, which they also referred to

as telecommuting or flexiplace.

What is different?

Mr. KANE. Chairman Davis, I think there are probably at least

three key dimensions.

First of all, a lot of the telework, in terms of telecommuting, it

tends to sort of assume fairly low bandwidth, and the amount of

bandwidth availability now is different.

Second, that means the types of applications that you can take,

that you can implement on your desktop, whether it is at home or

at Starbucks or at the airport, is entirely different, particularly in

terms of going well beyond text to do graphics and video.

One of the best pilots where I got tremendous insight was when

we worked in Loudoun County and they produced a whole magazine—graphics, layout, financial information—again, just with current software available.

And third, just the amount of processing power that is available.

All of this is becoming less and less expensive. And so we have

more powerful technology at a lower cost.

Chairman TOM DAVIS. Ms. Williams, in your testimony, you note

that Cisco has a policy of reimbursing employees for their home

broadband connections.

What percent of employees or how many employees take advantage of this?

Ms. WILLIAMS. Mr. Chairman, I would say that just about all, 90

percent, of our current telework employees take advantage of this

reimbursement service. I think the reason that we find there is

such a high adoption rate is, as Mr. Kane mentioned, the cost of

traditional commuting is skyrocketing and the cost of these new

broadband services is being reduced. In fact, some of the costs for

some of the residential and business-class broadband services are

actually starting to come down, and those are the services that provide the very high-bandwidth capable to do video and voice and

data to the home.

Chairman TOM DAVIS. What percent of these employees would

have paid for it anyway, out of their own pockets, and what percent—I mean, it is hard to guess, I guess—are you incentivizing to

now have the full bandwidth?

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Ms. WILLIAMS. It is a bit of a difficult question to answer in that

most of our employees, when they started with the company, had

the ability to utilize this service from the get-go. So there is a bit

of a difference in that.

We have not been shifting our employees from a pay-on-your-own

to a company-sponsored program. However, I do believe that because of the productivity gains that they feel they gain as a result,

as well as the quality-of-life balance that they receive, that they

would in fact offer to pay for that broadband service themselves if

they had to make the choice.

Chairman TOM DAVIS. I wonder if there is a way to tell the percent of employees who qualify for this and have the full broadband

versus ones who don’t qualify for this, if I give you a delta of people

that you have incentivized, that you actually are paying for. I appreciate the comment.

Mr. Luten, you made mention of the same thing in your remarks.

Any observations on that?

Mr. LUTEN. Sure. I think that I agree generally with Ms. Williams’ comments. It does depend on the circumstance.

I think we are also seeing some shifts, that Dr. Kane referred to,

in the way that communications technologies are available that is

moving these expenses perhaps beyond just based in the home and

opening up more regionwide broadband connectivity that is increasingly available, including here in the Washington, DC, area.

So we may be talking about connectivity that doesn’t just limit

you to the office or even limit you to the home, but that keeps you

connected in a variety of applications, which greatly increases flexibility for companies.

Chairman TOM DAVIS. Thank you very much.

Mr. Davis.

Mr. DAVIS OF ILLINOIS. Thank you very much, Mr. Chairman.

In my opening statement, I mentioned legislation that I had introduced last year calling for a pilot program. How in your estimation, each of you, would such a program help plan or move us

further along relative to telecommuting?

Mr. KANE. Representative, if I might respond to that. I think

there are three areas.

First of all, for military tactics, you know that the first thing that

breaks is the plan after the first shot gets fired. And so, while

agencies may have a plan, it is really the pilots, the demonstrations that you are advocating that let you first assess how good the

plan is.

Second, when you do these types of demonstrations and pilots,

you have the opportunity to tailor your response. It is sort of like,

do you move the picture a little bit to the right or to the left.

Is the network quite optimized? Are people quite familiar with

the software? What types of business processes are you supporting?

Is it more of a financial transaction or is it more of a client service

delivery type of transaction? That all implies some subtle adjustments.

Finally, and as I emphasized in my testimony, what I believe is

the most important is people realize what is possible. They use the

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sioned, and it becomes institutionalized in the way that they work.

Thank you.

Mr. DAVIS OF ILLINOIS. Ms. Williams.

Ms. WILLIAMS. Yes, Representative. I second Dr. Kane’s comments about the need for pilots. I do believe, personally, that the

program that you are speaking of will help organizations, particularly the employees and the managers, understand what is possible, because you don’t know what you can’t see and manage.

Those have been some of, I guess, the adages regarding not embracing telework.

But with the new technologies in place, there are capabilities to

manage by objectives, create new measurements for employee effectiveness and managerial effectiveness, and I think that the demonstrations will allow these folks to understand the possibility of

changes in behaviors and attitudes toward working differently as

we move the economy forward.

Mr. LUTEN. Just following up on those comments, I certainly

agree that planning is critical in terms of revealing what the hurdles are to successful teleworking. The time to understand those

hurdles is ahead of time and not during a time of crisis when understanding these things becomes much more jumbled in other

issues. So planning ahead of time is certainly critical.

Certainly another thing that we are seeing in other areas, however, are the spin-off benefits of exploring pilot programs. We have

worked with a lot of hospitals in rural areas who have developed,

for example, ride-sharing programs for emergencies like snowstorms and other circumstances. Folks try these things in times of

emergencies, or in this case, during a pilot activity, and it does create spin-off benefits where folks will try these things on a more

regular basis. That’s another thing I would note. There are probably additional spin-off benefits of pilot programs beyond just planning for emergencies.

Mr. DAVIS OF ILLINOIS. How much of a factor should cost be in

doing telework planning? How much of a consideration should we

give or do we give to cost as we plan for telecommuting?

Ms. WILLIAMS. Representative, I think the answer to that is, in

our experience, working with many of the agencies, it has been difficult for them to understand where to find the additional funding

for these types of initiatives. What we have experienced is that

there are significant savings in terms of real estate costs, traditional commuting expense costs that can defray these types of programs, as well as the efficiencies gained from having access to better applications and services to accomplish the work a bit more

quickly and more efficiently.

So I do think it is a challenge for agencies to understand where

to find the funds, and I think that the flexibility in allowing agencies to use some of the savings from other programs can help fund

these types of initiatives.

Mr. KANE. Representative Davis, I think I might take a slightly

different perspective than Julie in that, the last time I checked, the

Federal information technology budget as reported by OMB is

somewhere in the neighborhood of $61 or $62 billion. I think the

potential savings that agencies could achieve by telework, there are

probably enough puts and takes within $62 billion where cost

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should not be an issue for implementing wide-scale telecommuting,

telework programs.

Mr. DAVIS OF ILLINOIS. Thank you.

Mr. LUTEN. Let me just followup on the idea that looking at this

comprehensively from an organizational perspective seems to be

the best approach; that integrating the potential savings in some

areas with additional costs in other areas, that in order to look at

this stuff properly, we have to be looking at it as part of a comprehensive approach and integrating telework into our overall operations and not thinking about it as a stand-alone, adjunct idea.

Mr. DAVIS OF ILLINOIS. Thank you very much, Mr. Chairman.

If I could ask Ms. Williams, what percent of the Cisco employees

did you indicate telecommute?

Ms. WILLIAMS. Approximately 90 percent of our employees telecommute at least 1 to 2 days per week, and that percentage is actually higher in Europe where we actually—they are able to use

the higher percentage of mobility applications there.

Mr. DAVIS OF ILLINOIS. Thank you.

Mr. Chairman, could I just ask unanimous consent, I have two

letters here, one from the Tampa Bay Regional Planning Council

and one from the Association for Commuter Transportation.

Chairman TOM DAVIS. Without objection, they will be put in the

record. Thank you, Mr. Davis.

[The information referred to follows:]

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Chairman TOM DAVIS. Mr. Duncan.

Mr. DUNCAN. Thank you very much, Mr. Chairman. I am sorry

that another meeting prevented me from hearing the witnesses on

the first panel, and maybe some of these things were discussed a

little bit on the first panel; but let me just ask you, almost everybody seems to be very favorable to telework and telecommuting

and so forth. I don’t have anything against it. But when I practiced

law, we tried to anticipate or discuss more about what the weaknesses in our case were or what the problems might be, so we

wouldn’t be caught by surprise and so we would be better prepared.

I guess one thing I am wondering about is, what are the problems with this or—and more specifically, in the briefing paper we

have this statement. It says, ‘‘FEMA recognized that improper

identification of essential functions can have a negative impact on

the entire COOP plan.’’ That sounds kind of bureaucratic to me, because I am not really clear exactly what ‘‘improper identification of

essential functions’’ means. I would like to hear comments from

each of you about all that.

Dr. Kane.

Mr. KANE. Representative Duncan, I am not sure quite what the

phrase means, either, but let me try to respond as best I can.

Certainly, when we see obstacles in telecommuting and telework,

it is not so much technology sorts of issues, but they probably fall

into two areas. No. 1 is the function. We can’t do this dispersed;

we have to be all in the same room to do this.

Driving over here today, one of our staff members was telling us

the pilot we are doing with Loudoun County, their board of supervisors, where they found out yesterday that they could sort of mark

up some documents, where the chairman was one place and another member was another place and they were working it together. That is sort of, probably, illustrative of the functions that

don’t apply themselves or are not appropriate for the types of activities that could be supported by remote, distributed work.

And I think, second, as Chairman Davis discussed at the hearing

last July, there is some managerial resistance, ‘‘I have to see it to

know you are working.’’

Mr. DUNCAN. Ms. Williams.

Ms. WILLIAMS. Yes, Representative Duncan, thank you.

I echo Dr. Kane’s confusion on the comments about how to

miscategorize essential functions. I think, from our perspective, we

look at functions that are critical to our business to protect our

shareholder or to ensure shareholder value, and when I look at the

same corollary for government, I would anticipate that the agencies

would look at essential functions and categorize those that are essential to the citizens and maintaining their financial viability of

government.

It is difficult to understand why it is difficult to categorize the

right functions when I think of—I think folks ought to take a different tack and look at what is valuable to the citizen and what

is valuable to them as members of government.

Mr. DUNCAN. OK.

Mr. LUTEN. I will just say briefly, in following up on Dr. Kane’s

comments, I think the weaknesses we see in telework are that, in

fact, our telecommunications infrastructure is accelerating faster

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than our ability to change in our workplace culture. And I think

that is the challenge of the modern workplace, to keep up with the

changes in technology that are essentially always two steps ahead.

Things are more possible than they are easy to implement. Workplace culture, managerial culture, service culture, those things

seem to be the biggest hurdles to effective programs.

Mr. DUNCAN. My time is about to run out already. You have led

me into another area, or really two areas. One is, there was a comment made a while ago about the costs coming down. The computers do wonderful and miraculous and great things. I agree with all

that. I think, though, that everything has become much more expensive because of them; and what I am getting at is this.

The computer companies tell us that a computer is obsolete the

day it is taken out of the box, technology is moving so fast, and so

you always have to buy new equipment, it seems, every time you

turn around. I know we do for our offices.

I am wondering about the expense of all this, since we are talking about all these people working generally 1 or 2 days a week

at home. Do they have to duplicate with all the equipment at home

that they have in the offices? It seems that could get kind of expensive.

And then, last, I am a little concerned about the national security situation, because I heard on the CBS radio news a couple of

years ago that computer hackers got into the Top Secret files at the

Pentagon more than 250,000 times in the previous year. So it sort

of led me to believe that really there are no secrets of any kind

really anymore.

But do we have some concerns about that, about getting certain

information that we would have to limit or prohibit people from

working on at home?

Mr. LUTEN. I think data security obviously is a critical element

of any good telework plan. I think when we talk about people working at home a few days a week, as well as working in the office

place, a couple of things are offsetting those additional costs.

One is, as you mentioned, the fact that all this equipment is coming down in price significantly. Two, that many people that we

find——

Mr. DUNCAN. I don’t think it is coming down. It seems to me it

is going in another direction. At any rate, what I am wondering

about is, is there any tax loss when the company writes off all this

office space that they are not using—and they write off also, the

employee does, a home office? I don’t know. Anybody?

Mr. KANE. If I might comment, you’ve raised two issues, one

which was a cost issue, one which was a security issue. I will say

that one of our member companies, a very, very large defense contractor has found that it is more cost effective for them simply to

buy laptop computers for their employees and have the employees

take it home.

No. 1 is, it has more flexibility and so it is not—to the extent the

company is going to have to update its equipment every 3 years or

5 years, whatever, you’ve provided one computer that can be both

at home as well as at work or on the road.

And second, what was more important for them was the security

consideration, that they were able to configure those laptops to

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avoid viruses, to put in the appropriate protection; so, for that company, it was very much a security consideration.

Mr. DUNCAN. OK.

Chairman TOM DAVIS. Thank you very much.

Ms. Watson.

Ms. WATSON. Thank you, Mr. Chairman.

I am just wondering. We are talking about telework, but if there

were a gigantic disaster, are we sure that regardless of where people would work, that we could communicate? I am thinking that if

they are on a system and there is a disaster, let’s take September

11, that touched everything in a radius around the World Trade

Center.

I am just wondering, are we planning for alternative ways to

communicate? Are we planning on looking at virtual offices, homes,

and so on as teleworks? What is the breadth of what we are planning?

Let me give you an example of my concern. On September 11,

as you know, when those towers were coming down, there were

first responders walking around with pieces of equipment that did

not work. That is the reason why we lost so many firefighters, because they didn’t get the message to evacuate quick enough.

I am just sitting here listening to all this, this high technology

and so on, we will have them here rather than at their regular

workstations, but does reality say they’re going to even be able to

operate from their homes?

Mr. LUTEN. I have a couple of comments.

One, I think that we aren’t likely to see in a significant event

100 percent of people being able to continue to work through a

telework arrangement. However, we are likely to see——

Ms. WATSON. Can you explain that? Being able to work

through—what do we mean by that statement?

Mr. LUTEN. Being able to complete their job duties without being

in their normal, physical offices.

Ms. WATSON. How are they doing that? That is what I want to

hear.

Mr. LUTEN. Let me answer that if the question is—if people are

dispersed in terms of their home locations, the telecommunications

infrastructure in major events has proved a little more resilient

than transportation infrastructure. So we may lose some percentage of the telecommunications system and lose a percentage of our

workforce, but we can still find, even if it is 40 to 50 percent of people who are able to continue working, because the communications

in the area where they live is still working. If we have done good

planning up front, people understand how to communicate and

they understand what the alternate means of communicating are—

maybe that’s advanced contact lists of cell phones for everyone in

your company, etc. Planning these things out in advance can be a

big benefit.

In 2004, in the hurricane season, the total economic impact of all the hurricanes was in the neighborhood of $42 billion. A lot of that

was lost worker productivity. Even if we can get 30 to 40 percent

of people continuing to work, we can offset a lot of that impact.

Mr. KANE. Representative Watson, if I might also comment on

this, the answer to your question of how do they communicate is

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the Internet. If you have skepticism of that, let me share with you

what I believe is one of the untold success stories of September 11.

Technology developed by the Department of Defense in 1969,

called the ARPAnet, which was originally developed to support

communications in time of attack, which evolved into the Milnet

which has subsequently evolved into the Internet, worked exactly

as military planners planned it out in the early 1970’s.

I know personally, while no one else was able to sort of communicate and cell phones weren’t working and land lines, I have a

daughter who lives in Manhattan, and we were doing e-mail all

day on September 11 over the Internet just as military planners

had figured out approximately 30 years earlier.

Ms. WATSON. OK. That is one scenario, the one we know.

Suppose there is a nuclear explosion at one of our plants and so

on that will destroy everything in a radius of maybe 45, 50 miles.

Are you thinking forward? Are you thinking backward? We were

shocked by September 11. So I would say this is an opportunity to

look at how we communicate not just among the administration,

but out there in the hustings. If it is an enormous kind of attack

that could happen, are you sure that our systems can function?

Ms. WILLIAMS. Representative Watson, I would like to answer

that, giving an example of how our company architects its business

continuity plan and how teleworkers are able to work in the event

of a catastrophe.

As I mentioned in my testimony, the business continuity plan

really has four layers. The bottom layer is the network layer

where, for example, a data center of one agency would need to be

replicated many thousands of miles away from its center to provide

for the right continuity. The teleworking aspect of it, as long as

those data centers were replicated in the right manner, would then

allow employees anywhere, it could be outside of the country, to access those mission-critical applications in that data center.

And to the point that Dr. Kane mentioned before, it is the Internet protocol which is different from some of the radio interoperability protocols or radio frequencies that are in use today that provide that capability to access those applications.

So you have your data centers that are dispersed and then you

have the teleworking capability from any location around the

world, or the globe for that matter; and in fact, that’s how our employees overseas access our mission-critical applications that are

actually based in the United States. So I think the technology is

changing a bit where we have an increased capability for resilience

than we did have before.

Ms. WATSON. Thank you, Mr. Chairman.

Mr. SHAYS [presiding]. Thank you, Ms. Watson.

Mr. Dent, you have the floor.

Mr. DENT. Thank you, Mr. Chairman.

Good afternoon. Dr. Kane, you have discussed how current technology has changed the type of work that now can be done using

commercial telework. Can you give us some specific instances about

technology and what it now enables, and then also just cite some

specific departments or agencies that currently have telework policies that you would recommend?

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Mr. KANE. Let me cite a couple of Federal agencies and some at

the local level.

As I mentioned in one of my earlier responses to, I believe it was

Chairman Davis, the Treasury Inspector General, the tax administration group there, has certainly been on the forefront of telework

at the Federal level; and just about 2 months ago, we at the

Telework Consortium started working with the Securities and Exchange Commission to implement some pilots there. So those are

two good examples.

At the local level, we have just started a pilot with the Loudoun

County board of supervisors. As I said, one of my favorite examples

is a magazine, the Loudoun County magazine which—you think of

a magazine and how graphic intensive it is and everything that

goes into a magazine. It was produced without an office. We supported that as a pilot, to just demonstrate that something you

would think that people would have to come together could be produced and nobody ever had face-to-face contact in the production

of it.

Mr. DENT. Thank you. I have no further questions.

Mr. SHAYS. Thank you.

Mr. Luten, I just have one question. You stated that ACT has

had success in educating managers and executives about telework.

What educational techniques did you find effective?

Mr. LUTEN. Primarily, the No. 1 educational technique is, one,

experience that others have had. So more often than not, peer education can be one of the more effective forms when you are talking

about managers, because no one learns more than they can learn

from someone who does a similar job that they do in a similar location. So if we can find good peers, that’s one good example or one

effective example.

Probably the second is the notion of a pilot and just trying these

things. More often your fears and expectations turn out to be different than reality. So getting people to try something initially can

overcome a lot of those initial obstacles.

Mr. SHAYS. Do you have anything else?

Mr. DAVIS OF ILLINOIS. No.

Mr. SHAYS. Let me then just conclude. That is the only question

that I had.

Is there anything that you wish we had asked that you had prepared to answer, anything you think we need to put on the record

that wasn’t asked? That applies to all three of you. If there is, I

would like to do that now. Sometimes frankly we get the most interesting response from this question.

Anything, Dr. Kane?

Mr. KANE. No, thank you, sir.

Mr. SHAYS. Ms. Williams, any comments you would like to make?

Ms. WILLIAMS. No, thank you, sir.

Mr. SHAYS. Mr. Luten, anything?

Mr. LUTEN. No.

Mr. SHAYS. Thank you all very much. This hearing, with that,

will adjourn.

[Whereupon, at 3:55 p.m., the committee was adjourned.]

[NOTE.—The GAO report entitled, ‘‘Continuity of Operations

Agency Plans Have Improved, but Better Oversight Could Assist

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Agencies in Preparing for Emergencies,’’ may be found in committee files.]

[The prepared statement of Hon. Jon C. Porter and additional information submitted for the hearing record follows:]

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