```

[Senate Hearing 108-154]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 108-154

                      COMPETITIVE SOURCING EFFORT 
                    WITHIN THE NATIONAL PARK SERVICE

=======================================================================

                                HEARING

                               before the

                     SUBCOMMITTEE ON NATIONAL PARKS

                                 of the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

  TO CONDUCT OVERSIGHT OF THE COMPETITIVE SOURCING EFFORT WITHIN THE 
                         NATIONAL PARK SERVICE

                               __________

                             JULY 24, 2003

                       Printed for the use of the
               Committee on Energy and Natural Resources

                                 ______

89-915              U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2003
____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512�091800  
Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001

               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                 PETE V. DOMENICI, New Mexico, Chairman
DON NICKLES, Oklahoma                JEFF BINGAMAN, New Mexico
LARRY E. CRAIG, Idaho                DANIEL K. AKAKA, Hawaii
BEN NIGHTHORSE CAMPBELL, Colorado    BYRON L. DORGAN, North Dakota
CRAIG THOMAS, Wyoming                BOB GRAHAM, Florida
LAMAR ALEXANDER, Tennessee           RON WYDEN, Oregon
LISA MURKOWSKI, Alaska               TIM JOHNSON, South Dakota
JAMES M. TALENT, Missouri            MARY L. LANDRIEU, Louisiana
CONRAD BURNS, Montana                EVAN BAYH, Indiana
GORDON SMITH, Oregon                 DIANNE FEINSTEIN, California
JIM BUNNING, Kentucky                CHARLES E. SCHUMER, New York
JON KYL, Arizona                     MARIA CANTWELL, Washington

                       Alex Flint, Staff Director
                   Judith K. Pensabene, Chief Counsel
               Robert M. Simon, Democratic Staff Director
                Sam E. Fowler, Democratic Chief Counsel
                                 ------                                

                     Subcommittee on National Parks

                    CRAIG THOMAS, Wyoming, Chairman
                  DON NICKLES, Oklahoma, Vice Chairman

BEN NIGHTHORSE CAMPBELL, Colorado    DANIEL K. AKAKA, Hawaii
LAMAR ALEXANDER. Tennessee           BYRON L. DORGAN, North Dakota
CONRAD BURNS, Montana                BOB GRAHAM, Florida
GORDON SMITH, Oregon                 MARY L. LANDRIEU, Louisiana
JON KYL, Arizona                     EVAN BAYH, Indiana
                                     CHARLES E. SCHUMER, New York

   Pete V. Domenici and Jeff Bingaman are Ex Officio Members of the 
                              Subcommittee

                Thomas Lillie, Professional Staff Member
                David Brooks, Democratic Senior Counsel

                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Akaka, Hon. Daniel K., U.S. Senator from Hawaii..................     2
Kleinman, Sam, Vice President for Resource Analysis, Center for 
  Naval Analysis Corporation.....................................    25
Mainella, Fran, Director, National Park Service, Department of 
  the Interior...................................................     3
McElveen, Scot, on behalf of the Association of National Park 
  Rangers and the Association of National Park Maintenance 
  Employees......................................................    42
Segal, Geoffrey, Director of Privatization and Government Reform 
  Policy, The Reason Foundation..................................    29
Styles, Angela B., Administrator for Federal Procurement Policy, 
  Office of Management and Budget................................     9
Thomas, Hon. Craig, U.S. Senator from Wyoming....................     1
Wade, J.W. (Bill), on behalf of the Campaign to Protect America's 
  Lands and a Coalition of Concerned NPS Retirees................    35

                               APPENDIXES
                               Appendix I

Responses to additional questions................................    51

                              Appendix II

Additional material submitted for the record.....................    57

 
                      COMPETITIVE SOURCING EFFORT 
                    WITHIN THE NATIONAL PARK SERVICE

                              ----------                              

                        THURSDAY, JULY 24, 2003

                               U.S. Senate,
                    Subcommittee on National Parks,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 3 p.m. in room 
SD-366, Dirksen Senate Office Building, Hon. Craig Thomas 
presiding.

            OPENING STATEMENT OF HON. CRAIG THOMAS, 
                   U.S. SENATOR FROM WYOMING

    Senator Thomas. Welcome. We'll break the rules and start on 
time. Anyway, welcome to the hearing. We're glad to have our 
representatives from the Park Service and the Office of 
Management and Budget as well as the others. I think today's 
hearing is one that is important and timely, I believe. We have 
been working, of course, at this matter of competitive 
services, and the administration has been working on that. It 
is not a new thing. It has been in the area for sometime, and 
yet I think in a lot of ways we're not really as clear about 
how it is handled, how it should be handled, what is really 
going on, and I think it has caused some concerns in places 
where we really didn't have the facts, so we wanted to have a 
hearing and to talk about those things.
    I think we all recognize that the Park Service does have 
its own issues and its own operations and peculiarities, of 
course, as does every agency, so we have to find something that 
fits. I am personally a support of Federal Activities Reform 
Act. I think there is evidence in the industry, as well as 
other agencies, that there are times and places in which 
competitive outsourcing is a good thing to do. It saves us 
money and does the job.
    On the other hand, I think we have to recognize the 
peculiarities and the uniqueness of the Park Service, so we are 
not here to promote or defame the issue, but rather to make it 
clear as to where we are and where we need to go and how we can 
make it useful for the park service as well as other agencies, 
so we appreciate very much your being here, Senator, if you 
have any comments.
    [The prepared statement of Senator Thomas follows:]

   Prepared Statement of Hon. Craig Thomas, U.S. Senator From Wyoming

    Good afternoon. I want to welcome the representatives from the 
National Park Service, the Office of Management and Budget, and other 
witnesses to today's National Parks Subcommittee hearing. Our purpose 
is to hear testimony on the competitive sourcing effort that is 
currently underway in the National Park Service.
    Today's hearing is both timely and important. The Administration 
released a revised version of circular A-76 just a little over a month 
ago and several news stories have been written since that time. 
Information or misinformation is moving faster than a runaway horse. 
The stories range from exempting Park Service positions from the A-76 
process all together, to taking a close look at outsourcing archeology 
positions, to an article in a Colorado Springs newspaper praising the 
A-76 process. Just last week the House added language to the Interior 
appropriations bill to prevent competitive sourcing of archeology 
positions at two National Park Service centers.
    It's time to settle down this runaway horse, catch our breath, take 
a close look at what has happened, and discuss where this process is 
actually headed.
    We all know that the Park Service faces many challenges while 
making America's treasures available for millions of U.S. and foreign 
visitors each year. Limited funds are available for maintenance, 
security, safety, and a variety of other activities. We called this 
hearing today to discuss the use of competitive sourcing as a tool for 
improving fiscal and operational efficiency at a time when the Park 
Service is facing a tremendous funding shortfall for maintenance at 
almost every park. I would like to remind my colleagues on the 
Committee that in the past the Park Service has been instructed to 
reduce its number of commercial activities. Competitive sourcing is 
part of that effort.
    As the sponsor of the Federal Activities Inventory Reform Act, I am 
all for improving effectiveness and efficiency in government. At the 
same time, I realize that we need to go about it the right way. We need 
to have a clear process with a reasonable time line and people need to 
be kept informed. It's also important that any competition involves a 
level playing field--private sector contractors and the government 
should be judged on the same requirements.
    Again, let me thank all of the witnesses for coming today. I look 
forward to hearing the testimony and the opportunity to discuss an 
issue which I have spent a great deal of time working on and is a 
priority of this Administration.

        STATEMENT OF HON. DANIEL K. AKAKA, U.S. SENATOR 
                          FROM HAWAII

    Senator Akaka. Yes. Thank you, Mr. Chairman for holding 
this very timely hearing. It happens that this is the second 
hearing today on competitive sourcing in the Federal 
Government. I also sit on the Committee on Government Affairs, 
and we conducted a similar hearing earlier this morning looking 
at Federal contracting on a Government-wide basis. Before I 
continue, I want to welcome Fran Mainella. It is so good to see 
you again. It's always good to see you, and I also want to 
welcome Ms. Styles. I have seen her this morning, and it is 
good to see you again, Ms. Styles, and she was very helpful 
this morning.
    As I stated, Mr. Chairman, at the earlier hearing no one 
disputes the importance of a government that is both cost-
effective and accountable. Like any other entity, Federal 
agencies need to have the appropriate management tools and 
personnel skills to meet their mission, and it is in that light 
that we should examine what works best, is best performed by 
government employees, and which could be better performed by 
the private sector.
    I know you were instrumental, Mr. Chairman, in creating the 
FAIR Act, and I would like to compliment you on your hard work 
on that law. I agree that we must encourage cost-effective 
government programs and activities. I also agree that 
outsourcing, when used appropriately, can be a useful tool, but 
we just need to be careful in the manner in which it is 
undertaken.
    I am not yet convinced that outsourcing is appropriate for 
the National Park Service. From what I have read and from what 
my office has heard from career Park Service employees, the 
outsourcing proposal is taking a considerable amount of park 
managers' time, the cost of required studies coming at the 
expense of other operational needs, and I believe the program 
is having a significant negative effect on the morale of 
current National Park Service employees and may serve as a 
detrimental factor in recruiting future employees, but this is 
what we are hearing.
    Most importantly, I am not convinced that this program, if 
fully implemented, would improve the mission of the park 
service to protect our national parks, historic sites and 
monuments, and other treasured places.
    I am very pleased that the Park Service Director, Fran 
Mainella, is here and has done a good job in her position, and 
I always tell my friend that I look forward to talking with her 
about issues, and I still look forward to doing that and look 
forward to hearing from you and Ms. Styles.
    Lastly, Mr. Chairman, and finally, I have a statement from 
the National Treasury Employees' Union Chapter 296, which 
represents the Washington Office of the National Park Service, 
and I ask that their testimony be included in the record.
    Thank you very much, Mr. Chairman.
    Senator Thomas. Senator Bingaman.
    Senator Bingaman. Mr. Chairman, I would be glad to hear 
from the witnesses before we go vote, if you would like to do 
that. Whatever you want to do. I will forego any opening 
statement.
    Senator Thomas. Why don't we get started. Our first panel, 
thank you for being here, Fran Mainella, Director of the 
National Park Service, and Angela Styles, Administrator for 
Federal Procurement Policy of the Office of Management and 
Budget.

 STATEMENT OF FRAN MAINELLA, DIRECTOR, NATIONAL PARK SERVICE, 
                   DEPARTMENT OF THE INTERIOR

    Ms. Mainella. Thank you, Mr. Chairman. I am so pleased to 
be here today. Senator Bingaman, thank you for coming, and also 
I know Senator Akaka had to step out the door, but we 
appreciate you being here.
    It's also a great opportunity to be able to present the 
views of the Department of the Interior on the President's 
competitive sourcing initiative within the National Park 
Service. I'm also very appreciative because I think this 
hearing will give us an opportunity to clarify some issues that 
have related to competitive sourcing that may have been a bit 
confusing.
    I think to begin with, though, I do want to emphasize that 
management excellence lies at the heart of fulfilling our 
mission for parks and serving our citizens. The Nation's parks 
are the heart and soul of America, with some of the most 
dedicated and committed employees in the Federal workforce. 
Competitive sourcing, as part of the President's Federal 
management agenda, helps us achieve management excellence. It 
helps us to navigate the future. It gives us a tool to test 
ourselves and ask, are we the best we can be.
    Caring for the parks of the future generations requires 
that we study our management on a regular basis to ensure we're 
giving America, the American public the best value and making 
sure our resources are properly taken care of. By comparing how 
we currently do business with other options, competitive 
sourcing helps us find new ways to add value to how we serve 
the public. It's just one of those management tools being used 
to address today's needs.
    Some past government reforms had focused on downsizing or 
actual outsourcing without regard to how it might affect all of 
our employees. By contrast, though, competitive sourcing, or, 
as I like to call it, competitive review, because it is 
actually a review of what we are doing, allows us to be certain 
to look at certain activities and organizational structures 
such as, should we reorganize for greater efficiency, might a 
different provider, a local government or a private business be 
able to be configured to help us in our service or better 
provide for that service.
    One of the things that I wanted to clarify today--because 
there has been many media reports that say the National Park 
Service will outsource or privatize jobs, but competitive 
sourcing does not equal outsourcing or privatization. Let me 
help explain that a bit. Competitive sourcing is, we're looking 
at it as the process for competing services between the public 
and the private sector. It means our employees have a chance, 
as we go through the competitive review, it looks like we want 
to keep moving on, we can then do the RFP to actually have the 
private sector and our employees compete, and that is one way 
for us to look at that type of organization.
    But on the outsourcing, on the other hand, you've already 
predetermined, that is, going to the private sector, and that 
is going to be not necessarily giving it to the Federal 
employee. Privatization, on the other side, is actually where a 
whole function or a whole entity is going into the private 
sector.
    In addition, the media has presented as final decisions, 
certain MPS internal and draft memoranda which were prepared 
for just internal agency deliberations. It gave erroneous 
characterizations how that contributed to some further 
misunderstandings associated with competitive review.
    I personally have gone out and visited with many of our 
parks that are going through the competitive sourcing, Natchez 
Trace, for example, and I was just so impressed when I got out 
there to see the enthusiasm of those employees, because they 
believe, just as I do, that they're the best they can be, and 
they were preparing and ready to be reviewed, but they were 
confident in themselves that they felt they would definitely 
win if it went to the RFP process.
    So far, the Department of the Interior has experienced its 
employees winning about 40 percent of the competitive bids. We 
in the National Park Service feel anything that we do go to 
full bid on, we're going to do much better than that.
    Right now, our workforce, we're at a peak season. Not only 
are we in fire season, as I'm about to go out to Glacier that 
has major fires underway right now, but it's also our biggest 
tourist season, with 1 million people a day visiting our 
national parks, and I hope many of you will be able to get out 
on your break and visit with many of us, but what happens is, 
we are a seamless system in the national parks, but actually we 
have been working for so long with the private sector, because 
we're like small cities.
    We have to give to our private sector the ability to do 
trash removal and some of these other things that are very 
important to us. I don't know if everyone realizes, though, 
that if you went out today in the parks you probably would run 
into about 48,000 people but only 20,000 of those people are 
our employees, because the other 28,000 are already partners, 
business partners like concessionaires, cooperating 
associations that are also nonprofits.
    Also, in addition to the 48,000 you've got 125,000 
volunteers that are out there working with us, not every day, 
of course, but we do average--we will average a little over 
2,000 FTE's per day if we were to figure out on the volunteer 
efforts, and so really we have already been working in the 
private sector partnerships already to such a great extent.
    In fact, right now we currently do outsource, and we have 
outsourced over $1 billion per year in what we do.
    As you look at the FAIR Act, and I want to thank you, Mr. 
Chairman, for being able to come forth with that act, because 
it does give us a planning tool for us to move forward, it does 
provide us with an opportunity to look at and be able to check 
interested parties and see how they can be included, or might 
not be a part of our efforts, and of course our own positions 
in the Park Service, we have some that are commercial entities 
and some that are not. We had that evaluation done by 30 
different employees working with us to evaluate that back in 
the year 2000.
    One of the other areas I want to make clear is there are no 
ranger positions being included for consideration for 
competitive sourcing. I know that's been a confusion, in that 
no ranger positions being included.
    Also, the National Park Service has been asked to look at 
about 1,708 positions between 2003 and 2004. Already, though, 
of that 1,708 we have achieved 859 direct conversions that were 
done when direct conversions were being allowed, and we've been 
given credit. OMB has worked with us to give us credit on 
those, so now we're only looking at, out of that 1,700, another 
840-plus employees that we're looking at today.
    The media coverage, though, has suggested that we're 
looking at 70 percent of our employees to be outsourced, and 
that's just not correct. We really, if you look at our 
employees, what we're looking at is about 15 percent of the 
11,000 employees that are labeled commercial, and then less 
than 9 percent of our total workforce is being considered.
    I know diversity has been an issue that has been voiced by 
many individuals, and one of the things that I've been able to 
find out as I've explored this further is that the jobs 
actually, whether it's our employees or not, will still stay in 
that community and will be able to reflect that diversity of 
that community there, so that diversity will still be obtained, 
plus the economic value will be able to stay in the community.
    We are also very excited about one of the things that 
happened in Florida, having been my own home State. A minority 
contractor there has provided for workers for lifeguard and 
maintenance worker positions. The winning contractor hired all 
of our former temporary and seasonal employees who were 
interested in being rehired, and those employees report they 
are now working more hours for the contractor and making higher 
income.
    In Harper's Ferry, in West Virginia, and also Denver, 
Colorado, contractors have been helping us with providing jobs 
for the severely handicapped. Again, most of these were done 
through outsourcing opportunities, but again they have been a 
success story.
    The funding is another confusion area. I want to make sure 
we're clear on the funding sources. The National Park Service 
has never spent over the $500,000 limit for reprogramming to 
address our competitive sourcing. Also, as we look to the 
reprogramming letter that we have just sent up for $1.1 
million, there is no funds that are coming from accounts for 
maintenance backlog to do this study, and this includes--I know 
this is a lot of discussion about Mount Rainier. Mount Rainier 
is not being considered in the 2003 and 2004, and no 
maintenance backlog dollars are going to be used to do any of 
those assessments.
    In conclusion, Mr. Chairman, the National Park Service 
fully supports the competitive sourcing initiative of the 
President's management agenda. We have the finest, most 
dedicated employees in the Federal workforce, and we are 
working with them to find innovative ways to accomplish this 
initiative. We are doing our best to ensure fairness and 
effectiveness and efficiency in this review process.
    Mr. Chairman, thank you, and I'll be open for questions at 
the appropriate time. Thank you, sir.
    [The prepared statement of Ms. Mainella follows:]

 Prepared Statement of Fran Mainella, Director, National Park Service, 
                       Department of the Interior

    Mr. Chairman, thank you for the opportunity to appear before your 
Committee to present the views of the Department of the Interior 
(Department) on the President's competitive sourcing initiative within 
the National Park Service (Park Service).
    Management excellence lies at the heart of fulfilling our mission 
and serving citizens. Competitive sourcing, as part of the President's 
Management Agenda, helps us achieve management excellence. It gives us 
a tool to test ourselves and ask: ``Are we the best that we can be?''
    Every organization in society needs to periodically ask if there is 
a better way to organize itself to accomplish its mission. By comparing 
how we currently do business with other options, competitive sourcing 
helps us find new ways to add value to how we serve the public. It is a 
tool all federal agencies are using to accomplish this self-
examination. The goal of competitive sourcing is to ensure that we 
provide the public maximum quality services at the best possible value.
    Some past government reforms have focused specifically on 
downsizing or outsourcing, without regard for the overall effects of 
those choices on performance. By contrast, competitive sourcing is a 
review process. Through this competitive review, as I like to call it, 
we look at certain activities and organization structures and ask: 1) 
should we reorganize for greater efficiency; 2) might a different 
provider a local government or a private business, for example, be 
better configured to provide a service? This process assures that we 
maintain management vigilance. Even if competitive sourcing were not a 
Presidential initiative, it would be important for the Park Service to 
periodically check our efficiency and effectiveness by comparing 
ourselves to others who provide similar services.
    OMB Circular A-76, revised May 29, 2003, provides a mechanism with 
which to test the results of public/private competitions for commercial 
services routinely provided by both the federal government and private 
industry. But the recent revision to the Circular does not tell the 
entire story about the care, efficiency, and transparency with which 
the Park Service is undertaking its competitive reviews.
    The media has paid significant attention to the competitive 
sourcing issue. In their reporting, they presented as final decisions 
certain Park Service internal and draft memoranda, which were prepared 
for agency deliberations only. The erroneous characterization of these 
draft documents has contributed to some misunderstandings currently 
associated with the Park Service competitive sourcing initiative.
    I would like to correct these misunderstandings for the Committee 
today. I have personally visited and interviewed employees from some of 
the parks being studied and want to reiterate that the National Park 
Service has the finest employees in the federal service who have the 
highest dedication to our mission. So far, the Department has 
experienced its employees winning about 40 percent of the bids. We 
believe that the Park Service will do better than that. We believe that 
through a competitive review process, we can win many of these 
competitions and, through that process, we will find ways to enhance 
our own effectiveness. Our employees know that we are behind them and 
support their efforts to succeed in providing outstanding service to 
the public. I have reinforced this message to the National Park Service 
workforce in several memoranda to employees.
    The National Park Service manages 388 parks units, seven regional 
offices, a central office, and two service centers. Our parks offer a 
seamless operation of visitor services, resource and visitor 
protection. The Park Service, with its many locations, facilities, and 
infrastructure, is like a small city. Just like any small city, we have 
many business partners to help us prepare food, maintain our buildings, 
repair our vehicles, and do the many other activities associated with 
managing lots of buildings and infrastructure.
    Though we have an average of 20,000 federal government employees, 
over 48,000 individuals participate in these services, helping maintain 
our facilities, and greeting and interacting with the public. In 
addition to our 20,000 federal employees, private-sector employees, 
contractors, volunteers and partners provide concession operations, 
design, and countless service contracts such as sanitation, trash 
pickup, lifeguards, professional and administrative services. In 
addition, several thousand construction workers engaged in all types of 
projects throughout the park system.
    Most of the existing contracts are the result of outsourcing the 
process of contracting certain services without competing them between 
the private sector and Park Service employees. Over the years, the Park 
Service has outsourced many functions realizing that such services can 
be performed by contractors in support of the National Park Service 
mission. These contractors are readily available in the private sector 
to perform services that the Park Service has chosen not to accomplish 
in-house with the federal workforce. The Park Service currently 
outsources well over one billion dollars annually.
    An important distinction needs to be made between these traditional 
outsourcing efforts and competitive sourcing.
    Competitive sourcing is the process of competing services between 
the public and private sector, utilizing the fair, transparent 
processes outlined in OMB Circular A-76. Under this process, both the 
public and private sector have an opportunity to realign their 
organizations to provide the most cost-effective, efficient 
organization possible. The competition is conducted in accordance with 
the Federal Acquisition Regulation (FAR) and prescribed procedures 
outlined in Circular A-76. Either low price or best value (low price 
and most technically qualified) is established at the outset of a 
competition as the criterion for award. The current Park Service 
competitive sourcing plan, which allows for the competition of 
approximately 1,700 full-time equivalent (FTE) positions, is being 
accomplished under these competitive sourcing rules.
    Outsourcing involves the process of announcing a competition 
between private sector contractors utilizing only Federal Acquisition 
Regulation. It does not include competing with established public 
sector (federal) providers. Federal employees do not have a chance to 
compete under outsourcing procedures or re-engineer their services to 
enhance their prospects of prevailing in a competitive sourcing review.
    As described above, the Park Service currently contracts on average 
28,000 jobs to private industry using outsourcing procedures under 
Federal Acquisition Regulation and competitions between concessionaires 
as outlined in 36 CFR, Part 51, Concession Contracts.
    Privatization is a broader concept, encompassing transfers in the 
production of goods and services from the public sector to the private 
sector, and can include asset sales, long-term leases, and other 
public-private transactions. The Park Service has no intention of 
privatizing assets in this way.
    The Park Service, like all civilian agencies, has been working on 
competitive sourcing issues in compliance with OMB Circular A-76 for 
many years. During the 1980's, the Park Service engaged in several A-76 
competitions. From 1987 through 1997, the Park Service turned in an 
inventory of commercial positions, but did not actively engage in 
public/private competitions. The enactment by Congress in 1998 of the 
Federal Activities Inventory Reform (FAIR) Act signaled an increased 
emphasis on the A-76 program.
    Through your diligence and leadership, Mr. Chairman, the FAIR Act 
turned from a bureaucratic exercise to a valuable planning tool for 
agencies to use. The FAIR Act assists agencies in monitoring their 
inventories in a systematic way and identifies potential study areas. 
The FAIR Act requires all agencies to submit an annual inventory of 
commercial and inherently governmental FTE positions to OMB for release 
to Congress and the public. The Act provides a process wherein 
interested parties may challenge the inclusion or non-inclusion of 
positions on either side of the inventory to the agency. The Act also 
provides for an appeals process if the challenger is not satisfied with 
the agency response.
    To comply with the FAIR Act, the Park Service conducted a survey of 
all positions utilizing the Federal Personnel Payroll System (FPPS) to 
establish a benchmark for inherently governmental and commercial 
activities.
    Seeing the growing interest and emphasis on the initiative, the 
Park Service convened a panel of 30 subject matter experts in March 
2000 to do an in-depth review of all 237 job series in the Park Service 
to determine which were inherently governmental and which were 
commercial. The 2002 inventory contains 11,525 FTEs on the commercial 
inventory and 8,220 FTEs on the inherently governmental inventory for a 
total of 19,745 FTEs. This represents all employees, including 
permanent and temporary, on the payroll as of September 30, 2002. This 
differs slightly from numbers cited in the budget, because the 
inventory is a snapshot at one particular time while the budget shows 
the number of FTEs funded over the entire year. It is important to note 
that all ranger positions (0025 job classification series) are included 
on the inherently governmental inventory. None are considered 
commercial and none have or will be competed.
    Prior to the cutoff date of May 29, 2003, when the revised OMB 
Circular stipulated that no further direct conversions should occur, 
the Park Service successfully converted 859 positions to contract 
positions. All 859 positions were either vacant or involved new work 
where the positions contracted out were unencumbered. Not one permanent 
Park Service employee lost his or her job due to these direct 
conversions. In addition, the Park Service conducted all direct 
conversions and express studies without the use of consultants. 
Therefore, no appropriated dollars were spent on consultants to 
accomplish the 859 direct conversions over half of the goal established 
for Park Service competitions.
    There has also been confusing media coverage concerning the number 
of Park Service positions or FTEs being studied under the competitive 
sourcing initiative. Some media coverage has suggested that the Park 
Service is subjecting as many as 70 percent of its employees to study 
under competitive sourcing. This is not correct. The Department has 
asked the Park Service to study approximately 1,700 FTEs by the end of 
FY 2004. This represents approximately 15 percent of the 11,525 
commercial FTEs. We can only conclude that the 70 percent figure in 
some press reports came from an erroneous calculation of potential 
studies if the Park Service was to review all or a majority of the 
11,525 FTEs identified on the commercial inventory.
    The Park Service funded 20,505 FTEs in FY 2002. To clarify, one FTE 
amounts to 2,087 hours of work in a year, as opposed to a position 
which is generally encumbered by one individual and could be anywhere 
from a seasonal--who might work 2 or 3 months during the summer season 
(.25 FTE)--to a permanent full-time position, which would equate to 1.0 
FTE. The Park Service employs approximately 26,000 funded positions, 
including year-round and seasonal jobs. In a given year, at the height 
of the summer season, that translates into approximately 19,000 FTEs.
    One concern relating to competitive sourcing that has been raised 
by some observers is its potential impact on diversity. We are proud of 
our accomplishments in promoting equal employment opportunities for all 
Americans. We are equally proud to announce that we are working with 
the communities where competitive reviews are underway and are 
confident that the same diverse workforce living in those communities 
will continue to get those jobs. Whether a community provides a diverse 
pool of workers for the federal government or a similarly diverse 
workforce for the private sector, we take pride in the community 
retaining the jobs.
    For example, in Florida, a minority contractor has provided workers 
for lifeguard and maintenance worker positions. In addition, the 
winning contractor hired all of our former temporary and seasonal 
employees who were interested in being rehired, and these employees 
report they are now working more hours for the contractor than they did 
previously with the Department (taking into account work performed both 
for the government and private sector clients), resulting in higher 
incomes. In Harpers Ferry, West Virginia, and Denver, Colorado, 
contractors associated with the Javits-Wagner O'Day Act (providing jobs 
for the severely handicapped and the blind) have been contracted to 
provide file and mail services. These contractors and service 
organizations deal directly with minority and small businesses to 
provide workers from the local communities that truly benefit from 
these contracts. In the majority of instances, local contractors have 
won the competitions for Park Service work.
    The Park Service has also been criticized for spending many 
millions of dollars on competitive sourcing. Let me set the record 
straight. The Park Service has never spent over the $500,000 
reprogramming threshold in any given fiscal year since the competitive 
sourcing initiative began. We do have a reprogramming request now 
pending before the appropriations committee to spend another $1.1 
million on these studies in FY 2003.
    It has been reported, for example, that the Park Service used 
monies designated for the maintenance backlog at Mount Rainier National 
Park to fund competitive sourcing studies. This is not true. No 
maintenance backlog funds have been or will be used on competitive 
sourcing at any location. Mount Rainier is not currently on the Park 
Service competitive sourcing plan for FYs 2003 and 2004.
    In conclusion, the National Park Service fully supports the 
competitive sourcing initiative of the President's Management Agenda. 
The competitive review that this initiative fosters is an important 
tool used to ensure we are giving the American public the very best 
service for their tax dollars. We have the finest, most dedicated 
employees in the federal service, and we are working with them to find 
innovative ways to accomplish this initiative. We are doing our best to 
ensure fairness, effectiveness, and efficiency as we fulfill our grand 
mission of ensuring Americans can enjoy this Nation's outstanding 
historic, cultural, and natural heritage now and into the future.
    Mr. Chairman, thank you for the opportunity to comment. This 
concludes my prepared statement and I will be happy to answer any 
questions you or other Committee members might have.

    Senator Thomas. Thank you very much. I guess we had better 
recess for just a few minutes, and we'll be right back.
    [Recess.]
    Senator Thomas. Thank you very much. We'll come back to 
order. I might tell you that at 3:40 there is going to be a 
moment of silence on the floor to recognize the Capitol Police 
officers that were killed, so we will take a moment of silence 
here too at 3:40. Ms. Styles, why don't you go right ahead.

   STATEMENT OF ANGELA B. STYLES, ADMINISTRATOR FOR FEDERAL 
      PROCUREMENT POLICY, OFFICE OF MANAGEMENT AND BUDGET

    Ms. Styles. Thank you, Mr. Chairman, Senator Akaka. I 
appreciate the opportunity to appear before you today to 
discuss the administration's competitive sourcing initiative. 2 
years ago, we unveiled the President's management agenda, a 
bold strategy for improving the management and performance of 
the Federal Government. Opening commercial activities performed 
by the Government to the dynamics of competition is a major 
component of this agenda and the President's vision for a 
market-based government.
    Since the 1950's, successive administrations have 
encouraged agencies to consider whether commercial activities 
performed by the Government could be provided by the private 
sector in a more cost-effective manner. Competition has been 
encouraged through memoranda, a circular, a government-wide 
handbook, and even an executive order. Like us, past 
administrations recognized that public and private competition 
improves service delivery and decreases cost to the taxpayer 
irrespective of which sector wins the competition.
    In many ways, however, this administration's cost-cutting 
efforts can be distinguished from those of the past both in 
terms of the priority of the initiative and the tailored 
approach being taken to ensure the competition is applied in a 
reasoned and responsible manner for each agency, but I can tell 
you that the most challenging part of my job in this initiative 
is effective communication.
    I spend the vast majority of my day explaining to people 
that competitive sourcing is about a commitment to management 
excellence. It is a commitment to ensuring that our citizens 
are receiving the highest quality service from their government 
without regard to whether that job is being done by dedicated 
Federal employees or the private sector. In spite of our 
extensive effort, this information and confusion abounds. We 
are constantly fighting a flurry of intentionally deceptive 
propaganda.
    Contrary to the self-serving information, competitive 
sourcing is not about outsourcing, privatization, or reducing 
the Federal workforce. As Ms. Mainella pointed out very 
effectively in her testimony, competitive sourcing is a review 
process that asks two very important questions: one, should we 
reorganize for greater efficiency; and two, might a different 
provider, a local government, a nonprofit organization that 
employees disabled members of our society or a private business 
be better able to provide the service at a lower cost?
    The competitive sourcing initiative asks people to make 
very hard management choices, choices that affect very real 
jobs and help our dedicated and loyal career civil servants, 
but the fact that private competition and our initiative 
require hard choices and a lot of hard work make it one that 
can and is effecting fundamental real and lasting changes to 
the way we manage the Federal Government.
    Both the private and public sectors have conducted 
independent studies to document the effects of public-private 
competition. Each has reached the same conclusion. Subjecting 
in-house operation to competition consistently generates cost 
savings anywhere from 20 to 30 percent on average, regardless 
of whether the competition is won by a private contractor or 
the Government.
    The Department of Defense alone projects savings of more 
than $6 billion from A-76 competitions completed from 2000 to 
2003. DOD estimates that long run savings are about $85,000 per 
position over 5 years.
    One of my favorite recent examples is a graphics function 
of the Department of Energy. Before the competition, 
Headquarter Graphics was a 13-person operation. Through the 
competitive process, the in-house government employees 
determined that they could do the exact same jobs with 6 
people. In other words, the same graphics service could be 
delivered by half the number of people. By sharpening their 
pencils, benchmarking the private sector, and reorganizing the 
function, the Federal employees won the graphics function 
competition against the private sector head to head.
    Though small in number, this competition exemplifies the 
benefits of the competitive sourcing initiative. From this 
small, 13-person competition, DOD is estimating $635,000 in 
savings every year. The employees won, but through competition 
and the competitive process were able to save $635,000 a year. 
I'm not sure how anyone can make a rational argument that we 
should not do everything in our power to replicate this type of 
result throughout the Federal Government.
    While there is a certain level of comfort in maintaining 
the status quo, our taxpayers cannot afford, nor should they be 
asked to support a system that operates at an unnecessarily 
high cost, because so many of our commercial activities are 
performed by agencies without the benefit of competition. For 
this reason, the administration has called upon our agencies to 
transform their business practices. We have provided the tools 
for meeting this objective in a responsible, reasoned, and fair 
manner.
    This concludes my prepared statement, but I am pleased to 
answer any questions you may have.
    [The prepared statement of Ms. Styles follows:]

   Prepared Statement of Angela B. Styles, Administrator for Federal 
          Procurement Policy, Office of Management and Budget

    Chairman Thomas, Vice Chairman Nickles, Senator Akaka, and Members 
of the Subcommittee, I appreciate the opportunity to appear before you 
today to discuss the Administration's Competitive Sourcing initiative. 
Two years ago, the Administration unveiled the President's Management 
Agenda (PMA), a bold strategy for improving the management and 
performance of the federal government. Opening commercial activities 
performed by the government to the dynamics of competition--i.e., 
competitive sourcing--is a major component of the PMA and the 
Administration's vision for a market-based government.
    A number of Administrations have encouraged the use of competitive 
sourcing--through memoranda, a Circular, a government-wide handbook, 
and even an Executive Order. Like us, past Administrations recognized 
that public-private competition improves service delivery and decreases 
costs to taxpayers, irrespective of which sector wins the competition. 
Various studies have found savings of anywhere from 10-40%, on average, 
regardless of the sector that wins the competition. In fact, savings 
can be even higher. For example:

   Federal employees won a public-private competition in 1994 
        to perform base operations support at Goodfellow Air Force 
        Base. The competition has resulted in an effective savings of 
        46%.
   Private sector performance of aircraft maintenance at 
        McChord Air Force Base, work previously performed by the 
        government, has resulted in an effective savings of 66% 
        following a public-private competition in the early 1990s.

    Despite these positive results, use of public-private competition 
has not taken hold outside of the Department of Defense. Our 
competitive sourcing initiative seeks to institutionalize public-
private competition by providing an infrastructure and management 
blueprint for its considered application.
    Today, the Office of Management and Budget (OMB) is providing a 
report to Congress describing the steps we have been and are taking to 
implement competitive sourcing. A copy of the report is attached to 
this statement.* I would like to summarize that report for you this 
afternoon. I think you will find that the report provides important 
insight regarding our reasoned and responsible approach for ensuring 
the fair and effective application of this important management tool.
---------------------------------------------------------------------------
    * The report has been retained in subcommittee files.
---------------------------------------------------------------------------
    I am pleased that Fran Mainella is here to discuss the Park 
Services' efforts to use competitive sourcing. I will focus my 
discussion on government-wide efforts and defer to Ms. Mainella to 
address the specific steps being taken at the Park Service.
           the strategy for implementing competitive sourcing
    The Administration's strategy for institutionalizing public-private 
competition has three features:

          1. Agency-specific competition plans that are customized, 
        based on considered research and sound analysis, to address the 
        agency's mission and workforce mix;
          2. A dedicated infrastructure within each agency to promote 
        sound and accountable decision making; and
          3. Improved processes for the fair and efficient conduct of 
        public-private competition.

    Let me briefly describe how each of these features of our strategy 
reinforces careful planning and well informed decision making.
    Customized competition plans. The preparation of competition plans 
begins with the development of workforce inventories, as required by 
OMB guidance and the Federal Activities Inventory Reform (FAIR) Act. 
Agencies first differentiate inherently governmental activities from 
commercial activities. Inherently governmental activities are 
immediately excluded from performance by the private sector. The focus 
is strictly on commercial functions, whether they be computer support 
or landscaping and lawn mowing. Functions that are intimately related 
to the public interest must be performed by public employees. Our 
revisions to Circular A-76, the document which sets forth the 
guidelines for conducting public-private competitions, make no real 
substantive change to long-standing principles addressing what 
functions are appropriately considered to be inherently governmental. 
We will continue to depend on our able workforce to execute these 
important responsibilities on behalf of our citizens. OMB estimates 
that approximately 47% of the workforce from agencies being tracked 
under the PMA are inherently governmental.
    Once agencies have separated out inherently governmental 
activities, agencies then must differentiate commercial activities that 
are available for competition from those that are not. In deciding 
whether a commercial activity is inappropriate for potential 
performance by the private sector, agencies take various factors into 
consideration, such as the unavailability of private sector expertise, 
preservation of core competencies, or the need for confidentiality in 
support of senior level decision making. About 26 percent of the 
workforce is engaged in commercial activities available for 
competition. Individual agency determinations, however, vary from under 
20 percent to over 60 percent: no two agencies are alike.
    After an agency has identified commercial activities available for 
competition, it considers, in a disciplined way, which ones might 
benefit most from comparison with the private sector. Agencies are 
generally focusing use of public-private competition on commonly 
available, routine commercial services where there are likely to be 
numerous capable and highly competitive private sector contractors 
worthy of comparison to agency providers. They also consider factors 
such as workforce mix, attrition rates, capacity to conduct reviews, 
the percentage of service contracts, and the strength of the agency's 
contract management capabilities.
    For our part, OMB has created scorecards to measure agency progress 
in implementing competition plans. We also have committed to meet with 
agencies on a quarterly basis to provide assistance in the use of 
competitive sourcing as a management tool.
    OMB has moved away from mandated numerical goals and uniform 
baselines that were introduced at the beginning of the initiative to 
ensure a level of commitment that would institutionalize use of the 
tool within each agency. Instead, we have negotiated tailored baselines 
based on mission needs and conditions unique to the agency. As an 
additional step to reinforce our customized approach to competitive 
sourcing, OMB has revised the criteria that will be used to grade 
agency progress. The revised criteria, which are set forth in section 
III of our report, contain no government-wide numerical goals that 
would require an agency to compete a portion of the commercial 
activities performed by the government. However, the scorecard still 
includes the types of incentives that should facilitate the application 
of competitive sourcing in a sound manner.
    Agency management infrastructure. OMB requires that agencies 
designate a Competitive Sourcing Official (CSO) to be accountable for 
competitive sourcing actions in the agency. The organizational 
placement of the CSO is left to each individual agency. OMB further 
requires that agencies centralize oversight responsibility to help 
facilitate a wide range of activities, including:

   the development of inventories of commercial and inherently 
        governmental activities;
   the determination of whether commercial activities are 
        suitable for competition;
   the scheduling and preliminary planning of competitions, 
        including the coordination of resources to support the agency 
        provider;
   the tracking of results; and
   information sharing within the agency so past experiences 
        can inform future actions.

    Improved processes for conducting public-private competitions. For 
a long time, the acquisition community has argued that the benefit 
derived from public-private competitions could be much greater if 
performance decisions were made within more reasonable timeframes, 
processes were more accommodating to agency needs, and greater 
attention was given to holding sources accountable for their 
performance. To address these and other shortcomings, OMB has revised 
Circular A-76 to provide a number of results-driven features.
    Of particular importance, the revised processes concentrate on 
results--not the sector that provides the service--so that agencies and 
the taxpayer may reap the full benefit of competition. The processes 
are intended to place an equal degree of pressure on each sector to 
devise the most effective means to provide needed services. Here are a 
few of the new features of A-76.

   Focus on selecting the best available source. Because OMB 
        seeks to emphasize selection of the best service provider, as 
        determined through competition, the revised Circular deletes a 
        long-standing statement that the government should not compete 
        with its citizens. Deletion of the ``reliance'' statement is 
        not intended to denigrate the critical contribution the private 
        sector plays in facilitating the effective operation of 
        government. Without the private sector, the government would 
        not be able to meet the many needs of our taxpayers. The 
        deletion is simply meant to avoid a presumption that the 
        government should not compete for work to meet its own needs. 
        Current government incumbents should have the opportunity to 
        demonstrate their ability to provide better value to the 
        taxpayer.
   Better planning. The revised Circular emphasizes the 
        importance of preliminary planning as a prerequisite for sound 
        sourcing decisions. Before announcing the commencement of a 
        competition, agencies must complete a series of actions 
        including:

          determining the scope of activities and positions to be 
        competed;
          conducting preliminary research to determine the appropriate 
        grouping of activities as business units; and
          determining the baseline cost of the activity as performed by 
        the incumbent service provider.

   Time limits for completing competitions. Timeframe standards 
        have been incorporated into the revised Circular to instill 
        greater confidence that agencies will follow through on their 
        plans and to ensure the benefits of competition are realized. 
        Under the revised Circular, a standard competition must 
        generally be conducted within a 12-month period, beginning on 
        the date the competition is publicly announced and ending on 
        the date a performance decision is made. A ``standard 
        competition'' is the general competitive process required by 
        the revised Circular when an agency selects a provider based on 
        formal offers or tenders submitted in response to an agency 
        solicitation. An agency may extend the 12-month period by 6 
        months with notification to OMB. Streamlined competitions, 
        which I will discuss in a moment, must generally be completed 
        within a 90-day period.

    Agencies will be required to publicly announce, through FedBizOpps, 
the beginning of competitions, performance decisions made at the end of 
a competition, and any cancellation of an announced competition. 
Announcements of competition and performance decisions also must be 
publicized locally.
    I want to emphasize that the new competition timeframes are not 
intended to truncate planning. OMB deliberately structured the Circular 
so that timeframes, for either standard or streamlined competitions, 
will not begin to run until preliminary planning has been completed.

   Expanded opportunities to consider best value. Under the 
        revised Circular, agencies have more leeway to take non-cost 
        factors into account during source selection. For example, an 
        agency may conduct a phased evaluation source selection process 
        to consider alternative performance levels that sources may 
        wish to propose. If non-cost factors are likely to play a 
        significant role in the selection decision, an agency may, 
        within certain parameters, conduct a tradeoff source selection 
        process similar to that authorized by the Federal Acquisition 
        Regulation. The Circular limits use of tradeoffs to: (1) 
        information technology activities, (2) contracted commercial 
        activities, (3) new requirements, (4) segregable expansions, or 
        (5) activities approved by the CSO before public announcement, 
        with notification to OMB.
   Elimination of ``direct conversions.'' During the 
        development of Circular revisions, some public commenters 
        complained that the traditional authority to convert functions 
        with l0 or fewer positions directly to private sector 
        performance was encouraging agencies to ignore consideration of 
        the agency provider, even where a more efficient, cost-
        effective government organization could offer the better 
        alternative. The revised Circular eliminates direct conversions 
        and instead provides a versatile streamlined competition 
        process for agencies to efficiently capture the benefits of 
        public-private competition for activities performed by 65 or 
        fewer full-time-equivalent employees.

    While providing added flexibility, the Circular also incorporates 
mechanisms to ensure that agencies act as responsible stewards. For 
example, agencies must publicly announce both the start of a 
streamlined competition and the performance decision made by the 
agency. The notice announcing the initiation of a competition must 
include, among other things, the activity being competed, incumbent 
service providers, number of government personnel performing the 
activity, names of certain competition officials, and the projected end 
date of the competition. In addition, agencies must document cost 
calculations and comparisons on a standardized streamlined competition 
form. The official who documents the cost estimate for agency 
performance must be different from the one who documents the cost 
estimates for performance by either the private sector or a public 
reimbursable source. Finally, the agency must certify that the 
performance decision is cost-effective.

   Consideration of innovative alternative practices. OMB 
        recognizes that the nature of service delivery is constantly 
        changing and our processes must be able to meet taxpayer needs 
        in this dynamic environment. We must always be on the lookout 
        for better ways of carrying out federal missions. To encourage 
        innovation and continual improvement, the revised Circular 
        provides a process by which agencies, with OMB's prior written 
        approval, may deviate from the processes prescribed in the 
        Circular.

    While we must be forward thinking, we must also ensure that 
deviations are used only when there is good reason to believe 
significant benefit may be offered and when alternative processes are 
transparent and impartial. OMB believes the new standard and 
streamlined competition processes should effectively accommodate agency 
needs for the vast majority of public-private competitions and will 
carefully review deviation requests to determine if they are justified.

   Establishment of firewalls. The revised Circular seeks to 
        improve public trust in sourcing decisions by reinforcing 
        mechanisms of transparency, fairness, and integrity. Among 
        other things, the revised Circular establishes new rules to 
        avoid the appearance of a conflict of interest. The revised 
        Circular separates the team formed to write the performance 
        work statement from the team formed to develop the most 
        efficient organization (MEO)--i.e., the staffing plan that will 
        form the foundation of the agency's tender. In addition, the 
        MEO team, directly affected personnel and their 
        representatives, and any individual with knowledge of the MEO 
        or agency cost estimate in the agency tender will not be 
        permitted to be advisors to, or members of, the source 
        selection evaluation board.
   Post-competition accountability. During the revision 
        process, we heard numerous complaints regarding weaknesses in 
        post-competition oversight. Among other things, the old 
        Circular required post-competition reviews only for 20 percent 
        of the functions performed by the government following a cost 
        comparison. As a result, even where competition has been used 
        to transform a public provider into a high-value service 
        provider, insufficient steps have been taken to ensure this 
        potential translates into positive results.

    Under the revised Circular, agencies will be expected to implement 
a quality assurance surveillance plan and track execution of 
competitions in a government management information system. 
Irrespective of whether the service provider is from the public or 
private sector, agencies will be expected to record the actual cost of 
performance and collect performance information that may be considered 
in future competitions.
    OMB intends to work with the agencies to review costs and results 
achieved. This information will be used to evaluate the effectiveness 
of competitive sourcing at each agency and devise additional strategies 
to address agency-unique implementation issues. We will also work with 
the agencies to ensure they provide the Congress with the information 
it needs to ensure sufficient oversight of these activities and their 
associated costs.
    Finally, with the assistance of the Federal Acquisition Council, 
agencies will share lessons learned and best practices for addressing 
common issues. Using past experiences to inform future decision making 
will further ensure that competitive sourcing is a fair and effective 
tool for improving the delivery of services to our citizens.

             COMPETITIVE SOURCING AND THE FEDERAL WORKFORCE

    Clearly, competitive sourcing poses a challenge for government 
personnel who perform commercial activities that are available for 
competition. These providers must critically examine their current 
processes and determine how they can improve the delivery of services. 
Answers may not come easily, but they are ones which our taxpayers are 
owed.
    Historically, the government wins over 50% of public-private 
competitions. This high success rate should give employees confidence 
that they can and do compete effectively head-to-head with the private 
sector. As I described a moment ago, the revised Circular has a number 
of specific features to ensure that competition is applied in an even-
handed manner. Equally important, the revised Circular recognizes the 
talents of the federal workforce, the conditions under which the 
workforce operates, and the importance of providing the workforce with 
adequate training and technical support during the competition process 
to ensure they are able to compete effectively. In particular, the 
revised Circular seeks to ensure that the agency provider has the 
available resources (e.g., skilled manpower, funding) necessary to 
develop a competitive agency tender.
    As an example, the Department of Energy (DOE) recently competed the 
graphics function at DOE headquarters. Before the competition, this was 
a 13-person operation at DOE. Through the competitive process, the 
incumbent government provider determined that it could do the same job 
with 6 people. In other words, the same graphics service could be 
delivered by half the number of people. By sharpening their pencils, 
benchmarking the private sector, and reorganizing the function, the 
federal employees won the graphics function competition against the 
private sector. Importantly, however, through managed attrition, no 
involuntary separations are anticipated. Though small in number, this 
competition exemplifies the benefits of the competitive sourcing 
initiative. As a result of the competitive process, this organization 
determined how to become more efficient. The competition at DOE is a 
significant win for the taxpayer.
    Even when the commercial sector is chosen to perform the activity, 
there generally are only a small number of involuntary separations of 
federal employees--8% according to one study; 3.4% according to 
another. The percentage of involuntary separations should remain small. 
Nearly 40% of all federal workers will be eligible to retire by 2005, 
creating many new job opportunities across government. The 
Administration's human capital initiative is already helping agencies 
better train and retain a capable workforce.

                               CONCLUSION

    While there is a certain comfort level in maintaining the status 
quo, our taxpayers simply cannot afford--nor should they be asked to 
support--a system that operates at an unnecessarily high cost because 
many of its commercial activities are performed by agencies without the 
benefit of competition. For this reason, the Administration has called 
upon agencies to transform their business practices and embrace the 
benefits brought to bear by competition, innovation, and choice.
    Competitive sourcing is not about arbitrary numbers. This 
initiative is about reasoned plans, accountable infrastructures, and 
balanced processes that facilitate the application of public-private 
competition where it benefits mission objectives and the needs of our 
citizens. We appreciate the Subcommittee's interest in our Competitive 
Sourcing initiative. We look forward to working with you and the other 
members of Congress as we strive to bring lasting improvements to the 
performance of government through the sensible application of 
competition.
    This concludes my prepared statement. I would be pleased to answer 
any questions you may have.

    Senator Thomas. Thank you very much.
    Ms. Mainella, in the Park Service do you have persons 
working who are not Federal employees at this time?
    Ms. Mainella. We certainly do. As we mentioned earlier, 
there is actually 48,000 people out there that work that serve 
you as you come into the parks, and only 20,000 of them are 
Federal employees.
    Of course, one of our big groups, of course, are 
volunteers, but also we have our concessionaires, we have our 
cooperating associations, so many others that work along with 
us, so the Park Service for a very long time has been involved 
in working with the private sector, and I think in a very 
successful way.
    Senator Thomas. We had a hearing a while back on 
maintenance backlog and I understand the Department of the 
Interior put together a workforce plan. Is that the case in the 
Park Service?
    Ms. Mainella. Yes, sir. We are working on a workforce plan, 
and it will focus again, addressing actually one of the issues 
that I think affects all Federal Government. A lot of retirees 
developing, with those that are the baby boomers and others, 
and of course that will be taken into consideration as we look 
through our competitive sourcing.
    Senator Thomas. Ms. Styles, what is the difference in what 
you're talking about now as to what people were thinking about 
2 years ago in terms of outsourcing?
    Ms. Styles. I think we have learned a lot over the past 2 
years with our initiative. I think we have tried today in a 
report that we issued to Congress and throughout this process 
to make sure that we are doing this in a reasoned, rational 
manner that helps agencies meet their missions, it helps 
improve service to the taxpayers, it isn't taking money away 
from important functions while we're trying to do this, and I 
think that our approach to this has been cautious and 
thoughtful and it's constantly evolving, it's constantly 
changing as we learn more about private competition and how it 
works at our departments and agencies.
    Senator Thomas. You mentioned the notion that in preparing 
for competition the Federal employees were able to do with 
about half the number what they had done before with twice that 
number. What happened to the others?
    Ms. Styles. There were actually no involuntary separations. 
They either retired before the end of the competition or they 
moved to other places within the Department of Energy.
    Senator Thomas. Are there examples of this kind of 
outsourcing in the private sector that you have examined or 
made available?
    Ms. Styles. Absolutely. We have looked at outsourcing and 
competitive sourcing in private sector companies. If you look 
even at the information technology industry you had a model of 
IBM that I think over a series of years really transformed in a 
model that Dell uses successfully now.
    IBM did everything in-house with their own people, and over 
a period of time I think they've learned that to be competitive 
you really have to focus on what you are doing, have the people 
within your company focus on that, determine what is best to be 
done by another company or what needs to be done by your 
employees.
    Your focus generally at an information technology company 
is the next generation of technology, not shrink-wrapping the 
software that you have right now with your own employees. The 
same concept applies in the Federal Government. We want to take 
what the private sector has done in becoming more efficient 
over the past few years. We want to take that model and apply 
it in the Federal Government in a rational manner that allows 
our employees to compete.
    And I will add, a lot of private sector companies allow 
their employees to compete, too. They don't just make an 
outsourcing decision alone. They allow their employees 
oftentimes to compete for it as well, so we took that model and 
we tried to replicate that in the Federal Government, to the 
extent we can.
    Senator Thomas. Do you think there was an impression of 
higher numbers, as the conversation began about this as to how 
many jobs would be reviewed, and is practically the issue now?
    Ms. Styles. I think there was a lot of confusion about our 
percentages and our targets. People were very concerned that a 
single government-wide percentage and a strict deadline was 
arbitrary. I think we learned over time that that percentage 
and those deadlines weren't appropriate for every agency, and 
we didn't want those percentages any longer to be distracting 
from what we were really trying to achieve, which is, the 
adoption of public-private competition as accepted management 
practice at our departments and agencies.
    We're making a lot of progress, but we felt that the 
numbers and percentages were becoming distracting. They were 
becoming a focus where they really shouldn't have been a focus, 
because there were more exceptions to the rule in terms of 
member agencies and when they were going to get to certain 
percentages in the time frame than there were agencies that 
were really going to meet that.
    Senator Thomas. Percentages in the Department of Defense 
might be different than the Department of the Interior.
    Ms. Styles. Absolutely. The percentages are very different 
at each Department and agency, and I think we made changes, we 
announced changes today to our management scorecard and how we 
evaluate departments and agencies that recognizes that each 
agency is different. Each competition plan for each agency 
needs to be different, and a single government-wide goal is not 
appropriate right now.
    Senator Thomas. Fran, following the competition, if there 
were dollars saved, as hopefully the outcome, what happens to 
those dollars?
    Ms. Mainella. The dollars are to come back to the Park 
Service to again put into our resources, into our visitors' 
services, and I know we will be working with Angela and others 
to make sure that happens, but that is, it comes right back. 
Anything we save is supposed to come back to the Park Service.
    Ms. Styles. I would also note that is very different than 
the way this was implemented by previous administrations. When 
this was implemented before, the savings were assumed and taken 
out of those agencies' budgets. We're allowing those agencies 
to keep the savings they achieve and reallocate those resources 
where they believe they're most effective.
    Senator Thomas. Senator Akaka.
    Senator Akaka. Thank you very much, Mr. Chairman.
    Senator Bingaman. Mr. Chairman, it's almost 3:40.
    Senator Thomas. We're not quite there yet.
    Senator Akaka. Thank you very much, Mr. Chairman.
    My first questions are to Fran Mainella. Your testimony 
indicates that the National Park Service plans to conduct 
competitive sourcing studies on approximately 1,700 positions 
by the end of fiscal year 2004. I understand from the Park 
Service's own estimate that costs the Park Service about $3,000 
per FTE to conduct the studies needed to determine if 
outsourcing is appropriate. If my math is right, that amounts 
to about $5 million in competitive sourcing studies just for 
this year.
    As far as I know, there is not a line item in the 
appropriations bill for this purpose. My question is, can you 
tell me how much money the Park Service has spent on 
competitive source studies for 2002 and 2003, and where the 
money is coming from, but before you answer that, I know in 
your statement you had that you haven't spent more than 
$500,000 for that purpose, and so with that, I'm asking how 
much money the Park Service has spent on competitive sourcing 
studies in 2002 and 2003, and where the money is coming from?
    Senator Thomas. Would you hold for just a moment, please?
    Five years ago at this time, two Capitol police officers 
were killed in the line of duty, Jacob Chestnut and John 
Gibson. The entire Senate is observing a minute of silence in 
their memory, and so I wonder, please, if you would join me in 
a moment of silence.
    [A moment of silence was observed.]
    Senator Thomas. Thank you so much. I guess we're all 
particularly sensitive to the sacrifices people are making now, 
so you can go right ahead.
    Ms. Mainella. Thank you, sir.
    Senator Akaka, as I think I mentioned in my comments, and 
you may have stepped out at that point, but we, instead of 
looking--we're looking at 1,708 positions, but because of the 
cooperation with OMB we have received 859 positions credit for 
what we had done prior to, in our years for direct conversion, 
and so at this point we're really looking at about 849, 
something of that nature, to be reviewed.
    Not all of them also will be actual full studies. Some of 
them that we're doing are going to be what they call the 
streamlined program, which is for 65 employees or less. We're 
doing that, which is also much less expensive to do. Some of 
the areas, though, we will continue do full studies.
    The answer to the question on money, we have to this date 
spent under the $500,000. We have spent in, though, a 
reprogramming letter requesting $1.1 additional, which means 
that for doing all the studies in 2002 and 2003 we'd be looking 
at $1.6 million having been spent, and again we're looking for 
the reprogramming letter addresses, that we'd be using LAPS 
dollars, because we're in a fiscal year, and as you know the 
dollars came late, so we do think we have some dollars left 
that will help us address those, anything we do, sourcing or 
streamlining, but again, we're stressing the review part and 
not all will go out to a final proposal.
    Senator Akaka. A part of that question is, where is the 
money coming from, and you had that in your testimony also.
    Ms. Mainella. Yes, sir.
    Senator Akaka. You stated there is some concern with the 
effect competitive sourcing may have on workforce diversity. I 
have seen a memo prepared under your name that notes that 
almost 90 percent of the Park Service jobs being studied here 
in the Washington area may affect the diversity of the services 
workforce, with similar results in other large cities. Can you 
tell us and assure us that your concerns relating to diversity 
have now been fully addressed?
    Ms. Mainella. Thank you, sir. First of all, that memo was 
an internal opportunity for us to have discussions inside the 
Department of the Interior on the area to make sure--and again, 
we're trying to be the best we can be and during the review 
process you ask certain questions and you want to make sure--
and again, we're trying to be the best we can be. In doing the 
review process you ask certain questions, and you want to make 
sure we are considering all aspects.
    What I indicated, I think, in some of my comments has been 
that the diversity issue is very important. We work very hard, 
again we have the best employees and we continue to want to 
increase our diversity, but if somehow our employees go all the 
way and are not the winner of the competitive sourcing, the 
jobs, though, come from that same diverse workforce from which 
those employees are living, so that diversity should stay in 
place even if it's coming from the private sector.
    Also, I gave that story about in Florida where we had a 
minority contractor who actually brought on our employees. It 
was an outsourcing experience with lifeguarding, which we do 
contract out, and not only did our employees stay employed 
through the private sector, they actually were able to achieve 
a full-time position, which we were only offering part-time, 
and also achieve better salaries than what we were able to do.
    Senator Akaka. Our concern, and yours also, is the effect 
competitive sourcing may have on the employees, and I just want 
to ask, what are your expectations about the morale, about 
recruitment in regard to competitive sourcing?
    Ms. Mainella. Thank you, Senator. Again, one of the reasons 
I appreciate this hearing is, part of the issues, there may be 
some morale concerns here because there's been a lot of 
misinformation. Again, every article it seems like you see jobs 
are going to be outsourced or privatized, when actually you're 
doing a competitive review, and again it doesn't mean that the 
private sector would ever achieve those positions.
    So I have been able to get this communication--I've tried 
inside our own Park Service sending memos out to our employees 
trying to clarify that, but it does help having this hearing to 
be able to further emphasize that I think a lot of the concerns 
employees may have are due to confusion of what is actually 
happening here.
    Senator Thomas. Senator Bingaman.
    Senator Bingaman. Thank you very much. Let me just be clear 
that I understand how we're paying for these competitive 
sourcing studies. They're being paid for out of the operating 
funds of the various units, isn't that right?
    Ms. Mainella. It is operating--or, as we said, lapse fees, 
as I said, I don't think we're going beyond that. I look to 
anyone who can clarify that for me, but at this point it is 
just what dollars are going to be left at the end of the year 
to help pay for this.
    Senator Bingaman. Yes, but there's no additional money 
being asked for?
    Ms. Mainella. No. Well, I did put in $1.1 million 
reprogramming request, but it comes from those LAPS fees.
    Senator Bingaman. They're funds that would otherwise be 
used for the general operation of the Park Service.
    Ms. Mainella. General operations or other programs that we 
have, yes, sir.
    Senator Bingaman. We've had a lot of concern expressed by 
former Park Service personnel, and one of those, the former 
Associate Director Jerry Rogers, who you're probably acquainted 
with, who lives out in my State, he wrote a very good article, 
I thought, in the Santa Fe New Mexican, which is our largest 
newspaper in Santa Fe, and I would just like to read a couple 
of sentences here and get your reaction.
    He says, administrators have taken a grossly simplistic 
approach to the acts, speaking here about this Federal 
Activities Inventory Reform Act, I guess, to the act's 
encouragement to outsource jobs that are not inherently 
governmental.
    If a job title such as archaeologist can be found in the 
commercial world it has been put up for grabs. Private firms 
contract with Federal agencies to do archaeology, drug 
companies employ biologists, and some historians write and 
publish their own work, so three professions, these three 
professions that are central to the National Park Service 
mission have been placed at risk.
    I guess the question is--he goes on to say, in Through the 
Looking Glass logic, the Government has concluded that high 
level people with little understanding of natural and cultural 
resources are inherently governmental, while specialists needed 
to preserve the resources and provide preservation leadership 
are not.
    I guess what seems to me to be right is that there are 
people who make a career decision to devote themselves to the 
expertise that is needed by the National Park Service in 
archaeology, in biology, in some particular area, and they hire 
on to do that, and now they're being told, you know, your jobs 
are going to be competed.
    That causes a morale problem, I think understandably so, 
because they did not--I think many of them thought they were 
making some career sacrifices and deciding to stay with the 
Government and pursue their career that way, and now they're 
told down the road, we're going to compete these jobs and you 
may be out on the street trying to build a career in the 
private sector, so how do you respond to people like that?
    Ms. Mainella. Well, Jerry's a wonderful man, and we've 
worked closely with him. He's contributed so much to the Park 
Service, but also, again if you remember what you read a minute 
ago, Jerry talked about our outsourcing versus competitive 
review, which is what we're trying to be doing, or reviewing 
these positions.
    Archaeologists are wonderful assets to us in the Park 
Service, but as we were asked to through the President's 
management agenda, to look at different areas, I take right 
here in the Capital region, for example, our region right here, 
approximately 70 percent of the positions that the projects 
that are archaeological are already done through an outsourcing 
contract, because many times it was with our own employees.
    We're not looking at the archaeologists that are in the 
parks. We were looking at the archaeologists that are in the 
centers that also do a lot of projects in different areas.
    Senator Bingaman. But you're saying 70 percent of the 
archaeological work being done for the Park Service in the 
capital region is already being done by outsourced, and you're 
looking at the remaining 30 percent to see if that should be 
outsourced?
    Ms. Mainella. Well, actually it's 70 percent of this 
Washington area. You remember, we've got three other centers 
that do also, and you kind of take each center doing about 25 
percent of the whole Park Service archaeological projects, 70 
percent of the capital region's 25 percent is being done.
    Senator Bingaman. Well, I guess what I'm questioning is the 
whole notion that because there are private archaeologists who 
can be hired, therefore that is an area in which we do not need 
to maintain a government--that is not an inherent government 
responsibility, and therefore we should look to the private 
sector first to accomplish that. I just have real questions 
about that whole basic concept, but that is the basis upon 
which we're doing this review, right?
    Ms. Styles. Can I add a little bit about the archaeologists 
in the Park Service? When people talk about archaeologists, I 
think you're thinking particularly after a Washington Post 
story that came out last week you were thinking of 
archaeologists that are in our parks and that are on site.
    These are archaeologists in a building in downtown Lincoln, 
Nebraska who actually went to their web site yesterday and 
looked at, they're managing a data base, they are using, 
running a library with 2,800 documents, they are acquiring and 
maintaining global positioning equipment, they are writing 
newsletters. This is not an inherently governmental 
archaeological function.
    Senator Bingaman. No, but it is a function that requires 
building up expertise over a period of time, presumably, I 
mean, if you're going to do the function well, and I would 
think that for purposes of maintaining morale within the Park 
Service as well as stability of the services provided, and 
quality of the expertise developed, there is some value in 
having a core of people that aren't having to compete every 
couple of years to see whether or not they're doing this or 
bagging groceries down on the corner.
    Ms. Styles. They will have an opportunity to compete, and 
it is not to rid ourselves of all of the archaeologists. I 
think in order to manage the archaeological contract you do 
need people that understand that, but that doesn't mean that 
you necessarily are providing the taxpayer the best value at 
the lowest cost if you have archaeologists running a data base 
or running global positioning equipment.
    Senator Bingaman. Well, I can see how as part of your job 
as an archaeologist you might have to buy some global 
positioning equipment or run a data base, but I would think 
that there is also a lot of expertise that you develop in the 
course of a career as an archaeologist that I would like to see 
people be able to maintain and develop and not think, okay, I 
may be in a career move here, I'd better look over my shoulder 
and plan to be doing something else in a couple of years.
    My time is up, Mr. Chairman.
    Senator Thomas. Well, we've taken quite a bit of time. Are 
there more questions for this panel?
    Senator Akaka. Yes. I have one more question of Ms. Styles. 
As you know, many National Park Service employees often perform 
a number of different tasks in addition to the primary job 
description. For example, the maintenance employee may help 
fight fires or provide emergency and rescue services and help 
with basic interpretation needs for park visitors. The 
responsibilities are often done as needed.
    Contractors on the other hand are responsible for 
performing specific job functions according to the terms of the 
contract with the Government. How will the Park Service become 
more effective by replacing Federal employees who can perform a 
number of different functions with contractors who perform a 
specific task?
    Ms. Styles. I think you're assuming you would be replacing 
those employees. We can write, in terms of the contract, 
anything we want to. If you want to see if the private sector 
has the capacity to do both maintenance work and fight fires, 
you can put out the solicitation that way.
    But what I think is most important about this, before you 
ever go forward with the competition, is that we're asking the 
Park Service is this really the most efficient way to be 
organized? Is this the most efficient way within the 
Government? Is this effective, having people doing these 
different functions?
    I mean, there are real and important fundamental, necessary 
management questions that frankly I don't think we've ever 
asked, and it's so important that the first step in this 
process is to ask that question, is this the right way to be 
organized, is this the way the private sector would organize, 
how can we be more efficient within the Park Service or any of 
our other agencies?
    Senator Akaka. Assuming the competitive sourcing initiative 
saves money, what assurance does the Park Service have that it 
will realize those savings, rather than have its operational 
budget adjusted accordingly in the next budget request? What 
kind of accounting or data base will be used to track such 
savings over time?
    Ms. Styles. We're in the process of putting together a 
government-wide data base for tracking those. We've asked 
agencies in our A-11 guidance for the 2005 budget to very 
specifically identify the money that will be spent here. I 
think we're trying to make every effort to make sure that 
everyone understands what the costs are and that they 
understand what the savings are and that we provide all of that 
information to you.
    Senator Akaka. Thank you.
    Senator Thomas. Senator Bingaman.
    Senator Bingaman. Let me just ask a couple more questions, 
Mr. Chairman.
    I have a memo here dated May 7 from the chief of the Budget 
Office for the Pacific West region to the superintendents in 
the Pacific West region, and it says, as a number of parks are 
aware, our region recently received a $4,617,000 assessment to 
the regional repair rehab program to fund law enforcement costs 
for anti-terrorism activities and for competitive sourcing 
studies, so there are funds being used for competitive sourcing 
studies which are coming out of the regional repair rehab 
program. Is that right, or is he wrong?
    Ms. Mainella. No, Mr. Chairman, it's not correct. What had 
happened is, the region doing, trying to get ahead and work 
along with us, because we thought we were going to be in Code 
Orange all year, combined with the fact that we were 
anticipating--we were still functioning off of 1,708 positions 
versus having the credit for the 859 direct conversions, there 
was consideration at one point just to have our regions start 
to think, where would they get the funding for that in order to 
address that if it was in those conditions, and I think they 
were anticipating that they might have to use those funds.
    We are not using those funds, so we're not moving forward 
in that at all. That was a staff person who was trying to do 
good work that was trying to position a case somehow we were in 
those positions. As you know we have not been in Code Orange 
for the whole year, and that we also have been able to get the 
credit for the 859 positions, so that has made a major 
difference in our ability to only use LAPS funds instead of 
having to go into any other kind of funding.
    Senator Bingaman. Let me just ask also about this Mount 
Rainier National Park. I think you said in your testimony there 
is not going to be any outsourcing there.
    Ms. Mainella. We're not considering it in 2003-04. I can't 
say it will never be, but in 2003 and 2004 it's not in the 
plan.
    Senator Bingaman. Congressman Dix gave a statement on the 
House floor where he said the reason--he essentially took 
credit for having persuaded you to exclude Mount Rainier from 
the outsourcing study. Is that the way it came about?
    Ms. Mainella. I love Congressman Dix.
    Senator Bingaman. If that is so, then I need to come see 
you about a couple of places in New Mexico, if that's the way 
the system is working.
    [Laughter.]
    Ms. Mainella. No, sir. Actually, what made the difference, 
I go back to the fact that originally we were functioning off 
of 1,708 positions, and at that point we still were using 
those, but we had not received permission from OMB to receive 
credit for the 859 direct conversions.
    As a result, once we got that credit, when the regions--
Mount Rainier was in consideration, as were many other parks in 
the very beginning. Because of the fact that it would be so 
broad, we would have to pick up another 859 positions. When we 
were able to get the direct conversions we were then able to go 
back and narrow down that list, and the regions, or each of our 
regions were asked to go back and revisit that list.
    Mount Rainier was taken off that list as a result of the 
fact that many of those positions are in a little more remote 
territory. We do kind of try to, as we look at our competitive 
sourcing reviews, we are trying to look at where there are good 
opportunities to maybe find a private sector partner to look at 
that might actually work with us on one of these projects, so 
Mount Rainier came off the list.
    And again, as much as I love Congressman Dix, it was due to 
the fact that it's a more remote location, and the fact that we 
received the 859 direct conversion values, so it came off.
    Senator Bingaman. So he cannot legitimately claim credit 
for persuading you?
    Ms. Mainella. Congress can take credit for anything they 
would like to.
    Senator Bingaman. So if he runs a 30-second spot in his 
next campaign, here I saved these jobs----
    Senator Thomas. This doesn't apply to New Mexico, Senator.
    [Laughter.]
    Senator Bingaman. I'm afraid the exclusion of Mount Rainier 
doesn't apply to New Mexico.
    Let me just ask one other question and then I will desist, 
or just make a comment, Mr. Chairman. We have a lot of people 
in my State who are current employees and former employees of 
the Park Service who are very proud of the public service that 
they have rendered, and committed their entire careers to being 
in the park service, and to a person they are strongly opposed 
to this outsourcing initiative, and they believe this will do 
irreparable damage to the Park Service and to its ability to 
continue with this proud tradition of people who have committed 
themselves and their full careers to this important work.
    How do you respond to that? How do we avoid turning the 
Park Service into a sort of a revolving door where we sign a 
contract with this firm for a couple of years to do a project, 
we sign a contract with this firm to do something for a few 
years, and you eventually don't have that same tradition and 
that same pride in the career Civil Service that I think is 
very valuable?
    Ms. Mainella. Again, as you probably heard me say earlier, 
we have the best employees. I am so proud of our employees, and 
that is why I also believe that our employees, as they go 
through the competitive review, again not outsourcing but a 
competitive review, where they can tell the story about what 
they do, as I tell them, this is the time not to be humble. 
Make sure everyone knows what you do in your positions, and be 
able to have that reviewed and analyzed so that if we decide to 
go forth with an RFP to have the private sector also look at 
it, then at least we're looking at a fair comparison.
    Our point, though, is again, no rangers are being 
considered. The key people that have interaction on a regular 
basis with the public will be, again, continuing. We do not 
anticipate putting those folks up for any kind of 
consideration. Keep in mind, even those that are listed that 
are commercial categories we can choose not to go forward with 
that, and again you heard Angela talk about the fact that we'll 
be working on a case by case basis with each agency to make 
sure that we're looking at what positions really could be 
considered and go forth from there, but I would never want to 
lose that pride, and I never want to have that kind of impact 
on our employees, as you've indicated.
    Senator Bingaman. Thank you, Mr. Chairman.
    Senator Thomas. You know, it is interesting, as we observe 
this you go out and talk to people generally and you say, hey, 
we're trying to find a way to make government more efficient, 
to be able to use tax dollars better. Everyone would say, hey, 
great, but somehow when this comes along, and you said in one 
of your statements that the competitive sourcing will focus on 
positions where the projected retirements, high attrition 
positions that are difficult to recruit and retain, and 
furthermore there's going to be not more than 8 or 9 percent of 
the total, I think we get the idea that you're talking about 
everybody in the Department. Is that right?
    Ms. Mainella. Again, why I appreciate this hearing is to 
try to get the correct information out there, because there's 
been so much misinformation, I think like Angela talked about 
communications, so much of what you hear and what you see 
written to you as congressional leadership is, they say we're 
going to outsource these things, and we're not. That isn't the 
direction we're heading. We are looking at review, and I would 
think we always ought to be reviewing what we do.
    I've been in management a long time from State parks to 
others, and we review and address those issues on a regular 
basis, and I think our employees, once they understand that, 
feel a lot better about it. Sure, there's still anxiety, but 
when they understand the decision to outsource, remember, 
that's where you've actually decided to go out to the private 
sector. That isn't what we're doing here. We instead are 
reviewing, and then deciding if we're going to allow the 
private sector even to bid, in addition to our own employees.
    Senator Thomas. Well, thank both of you. I know it's a 
difficult area, and we appreciate very much your being here.
    Ms. Mainella. Thank you so much.
    Senator Thomas. On the next panel, we're going to have Mr. 
Sam Kleinman, vice president for resource analysis, Alexandria, 
Virginia, Geoffrey Segal, director of privatization and 
Government reform policy, Arlington, Virginia, Bill Wade, 
former Superintendent of Shenandoah National Park, Tucson, and 
Mr. Scot McElveen, board member for special concerns, 
Association of National Park Rangers, Harpers Ferry.
    Gentlemen, if you will, please. We thank you for being 
here. Obviously, this is an interesting topic and there are 
different points of view on it. Your full statements will be 
put in the record, so if you could keep your comments to about 
5 minutes we would appreciate it. Why don't we just start--
let's see, we'll just start and go right down the line.

         STATEMENT OF SAM KLEINMAN, VICE PRESIDENT FOR 
    RESOURCE ANALYSIS, CENTER FOR NAVAL ANALYSIS CORPORATION

    Mr. Kleinman. Good afternoon, Mr. Chairman, Senator Akaka. 
Thank you for inviting me to speak to you today. I am Sam 
Kleinman from the CNA Corporation. We're a private nonprofit 
research organization here in Alexandria. We've studied public-
private competitions for over a decade, and I'm going to 
briefly present our findings on the Defense Department's 
competitions under the A-76 circular.
    The Defense Department is the biggest user of the program 
and is the greatest source of lessons learned over the last 25 
years. The rationale for the program is very clear. Some argue 
to outsource all work that is not inherently governmental, 
others argue that we should keep all current government work 
in-house. The A-76 program is a compromise between those 
positions. For those jobs that are not inherently governmental, 
it allows for either solution.
    Potential providers of services to the Government, both 
public and private, are given the opportunity to demonstrate 
that for a specific service they provide the best value. A-76 
is properly seen as a competition program and not an 
outsourcing program and, in fact, in the Department of Defense, 
roughly half of the winners were in-house teams.
    Does the competition save money? The evidence is 
overwhelming and compelling. The public-private competitions 
have saved money for the Government. In the 1980's, there were 
over 2,000 competitions in DOD and they saved approximately 30 
percent. Since 1995 there have been several hundred, and 
they've saved on average 40 percent.
    The competitions save money whether they're won in-house or 
whether they're won by a private firm. We see that 
restrictions, restricting competitions to small businesses who 
are often concerned about these issues, about competing, that 
restricting them does not cut into the savings. Most of the DOD 
competitions were set aside for small businesses, and we found 
that those set-asides were producing bigger savings and had 
more bidders from the private sector than the unrestricted 
competitions, and in fact many of the small businesses were 
actually winning the unrestricted ones also. For the concerns 
about long-term savings, detailed follow-up studies, private 
winners show that savings persist years later.
    We also looked at some Army and Air Force competitions 
where they recompeted it 3 to 5 years later and found that they 
got even more savings beyond the original 30 to 40 percent.
    Does performance suffer? We find that performance has not 
been degraded. We have surveyed customers, managers, and 
contract officers, and in their view performance may dip 
slightly in the first year during a transition, and that often 
happens whether a private firm or a government firm wins, but 
after that we often find that they come back to pre-competition 
levels and they often exceed those levels.
    In one particular study we looked in in depth, aircraft 
maintenance by contractors, we found that they were able to 
keep the aircraft up at higher levels than previously so they 
get more aircraft into the air, even as the aircraft were 
aging.
    There is a cost to these competitions, as noted. The data 
isn't good, in that most times they don't keep data on that, 
but it does appear to be about 5 to 10 percent of the annual 
cost of the original activities, and that includes performance 
work statements and developing what they call the MEO's.
    For the average saving, it's 30 percent, and that means 
that the agency recoups that investment in 4 months, so 
whatever you give up this year you've got three times more next 
year.
    We should agree that facing competition is a difficult 
process for current employees, especially since they haven't 
done this before. The data is not complete either, but the 
evidence is that long-term effects are not as dramatic as many 
feared. Very few are separated involuntarily. Many transfer to 
other Government positions, or take advantage of early 
retirement. Others join the private firms that will do the 
work. Employees have the right of first refusal with the 
contractor, when the private firms are often eager to hire the 
workers.
    Does this carry over to the Interior, National Park 
Service? I think the evidence is fairly consistent across 
organizations and functions within DOD. You will find they have 
competed both the operations and maintenance facilities, 
utilities, roads, vehicles, equipment. DOD has competed 
administrative functions, and these functions have been 
competed individually and jointly with other functions.
    Together, these functions I just mentioned appear to 
represent over half the positions listed by the National Park 
Service in their inventory. It would be hard to argue that they 
shouldn't at least be evaluated through the process. Our 
results show the value of competition. This is about leveraging 
our entire national workforce, public and private, in support 
of public objectives. This is about looking at all alternatives 
and not limiting our choices in performing public missions.
    Again, I appreciate the opportunity to participate in the 
debate today in this important issue. I'll be glad to provide 
any other detailed analysis to your staff or to the Department. 
Again, thank you.
    [The prepared statement of Mr. Kleinman follows:]

        Prepared Statement of Sam Kleinman, Vice President for 
        Resource Analysis, Center for Naval Analysis Corporation

    Good afternoon, Mr. Chairman. I thank you for inviting me to speak 
before the subcommittee. My name is Sam Kleinman and I am a Vice 
President at The CNA Corporation, a nonprofit research and analysis 
organization in Alexandria. We have studied public-private competitions 
for over a decade. I will briefly present our findings on the Defense 
Department's competitions under circular A-76. The Defense Department, 
as the biggest user of the program, is the greatest source of lessons 
learned from the A-76 program. It has conducted public-private 
competitions for many of the functions that the Department of the 
Interior is considering for its competitions.

               WHAT IS THE RATIONALE FOR AN A-76 PROGRAM?

    Some argue that we should outsource all work that is not inherently 
governmental; others argue that we should keep current government work 
in-house. The A-76 program is a compromise between those two positions. 
For those jobs that are not inherently governmental, it allows for 
either solution.
    It represents a policy in which all potential providers of services 
to the government, whether they are public or private providers, are 
given the opportunity to demonstrate that, for a specific service, they 
provide the best value. The A-76 program provides a mechanism to 
compare the current services with alternative approaches and teams, 
both public and private.
    Given its structure and procedures, A-76 is properly seen as a 
competition program and not an outsourcing program. In fact, in the 
Department of Defense, roughly half of the winners have been in-house 
government teams.

                    DO THE COMPETITIONS SAVE MONEY?

    The evidence is overwhelming that public-private competitions have 
saved money. In the 1980s, over 2,000 competitions saved an average of 
30%; since 1995, several hundred competitions have saved, on average, 
40%. In total, DoD has competed over 100,000 positions in 2,300 
competitions. We see savings whether an in-house team or a private firm 
wins the competition.
    These findings have not been limited to the Defense Department. We 
saw 30% savings at the GSA in the 1980s. Others have found savings in 
state and local competitions ranging from 20% to 60% and savings of 20% 
in a comparable program in Great Britain.
    We also know what contributes to more savings and what seems to be 
unrelated to savings. The type of service competed seems unrelated to 
the size of savings: almost all reduce costs. Competitions for large 
activities produce a higher percentage of savings than competitions for 
smaller activities. Competitions that attract many bidders produce 
greater savings than competitions that attract only a few bidders.
    We see that restricting competitions to small businesses does not 
reduce the savings. Sixty-eight percent of the DoD competitions, 
accounting for 40% of the positions competed, were restricted to under-
represented groups in businesses. Most were small-business set-asides. 
For larger competitions, with over 100 positions, 23% were restricted. 
We looked at these restricted competitions and compared them with those 
that were unrestricted. The set-asides produced greater savings and 
attracted more bidders. We also found that 15% of the unrestricted 
competitions were won by small businesses.
    These are real long-term savings. Detailed follow-up studies of 
private winners show that savings persist years later. We also looked 
at some Army and Air Force competitions. When they were recompeted 3 to 
5 years later, we found further savings beyond the initial 30%. We 
looked at how private firms performed under aircraft maintenance 
contracts. We saw fewer maintenance hours per flying hour, and this 
persisted 10 years after the initial competition. In all the cases, 
these are not one-time savings to the government.

                        DOES PERFORMANCE SUFFER?

    Performance has not been degraded. We have surveyed customers, 
managers, and contracting officers to get their input. In their view, 
performance may dip slightly during the first year of performance, 
whether the winner is a private firm or the government's newly 
structured workforce. However, performance quickly improves to the pre-
competition level and, with private winners, frequently exceeds the 
pre-competition level in later years. In our analysis of aircraft 
maintained by contractors, we found more aircraft available for 
flights, even as the aircraft were aging.

                  ARE COMPETITIONS COSTLY TO PERFORM?

    The data are limited on the costs to run these competitions. Where 
we have the data, it looks like it cost 5% to 10% of an activity's 
annual cost to run a competition. That includes creating a performance 
work statement, developing the government team's Most Efficient 
Organization, and completing the solicitation. But, with the average 
savings of 30%, the agency recoups that investment within 4 months.
    Some of those costs reflect legacy problems with how we manage 
federal support activities. For example, the costs include the time and 
resources needed to determine what the organization really spends to do 
its job. With a good accounting system, determining this shouldn't cost 
a lot--but in many public activities it does. Also, the agency has to 
develop a performance work statement around performance criteria and 
performance standards. Again, it appears that there aren't performance 
criteria and standards for work performed in-house at many activities. 
The fact that an activity cannot easily identify its costs and 
performance requirements is not an argument against evaluating 
alternative management structures.

                   HOW DO WE PROTECT PUBLIC WORKERS?

    Facing competition is a difficult process for current government 
employees. The data on employees are not as complete as we'd like, but 
the evidence suggests that the long-term economic effects on most 
employees are not as dramatic as many feared. Very few are separated 
involuntarily. Many transfer to other government positions or take 
advantage of opportunities for early retirement. Others join the 
private firm that will do the work. Employees have a right of first 
refusal with the contractor when contracting out the activity. Private-
sector firms are eager to take advantage of the skills that these 
employees possess and are required to provide wages and benefits that 
are comparable to government levels. In practice, contractors want to 
hire more of the affected workers than they can.

             ARE THERE PROBLEMS MANAGING THE COMPETITIONS?

    Without doubt, these public-private competitions have had problems. 
Some examples follow:

   The competition process is too long. Average time is over 2 
        years. This can be very disruptive, in part because permanent 
        workers leave and are either not replaced or are replaced with 
        temporary workers. Services degrade before the winner is 
        selected.
   There is poor follow-on monitoring, particularly of in-house 
        winners.
   Statements of work are often too restrictive and limit the 
        competitors' ability to make significant improvements or 
        innovations
   The government does not adequately plan for transition.

                       CAN WE FIX THESE PROBLEMS?

    The problems are not inherent to the program. They can be addressed 
with a reasonable set of practices. Here are a few suggestions:

   Headquarters should fund the competitions. Don't require 
        local units to pay for the competitions out of their operations 
        budgets.
   Use a centralized management team to help conduct the 
        competitions. This could be very effective if the team works 
        with the local personnel. This allows competitions to be 
        conducted by people with experience in A-76 while incorporating 
        the expertise associated with a specific activity.
   Let the organizations keep some of the savings. Put the 
        money back into the programs. For example, the Department of 
        the Interior can use the savings from this program to reduce 
        the maintenance backlogs within the National Park Service 
        (NPS).
   Develop a cost and performance tracking system early. This 
        should be part of the contract or, for in-house winners, part 
        of a Memorandum of Understanding.
   Separation pay should be improved. Offer generous separation 
        packages to affected workers and relaxed rules on reentry into 
        the federal workforce. A core staff should receive special 
        compensation for seeing the activity through a transition.

           DO THESE FINDINGS CARRY OVER TO INTERIOR AND NPS?

    These findings are fairly consistent across organizations and 
support functions. Within DoD, you will find they have competed both 
the operations and maintenance of facilities, grounds, utilities, 
roads, vehicles, and equipment. DoD also competed administrative 
functions. These functions have been competed both individually and 
jointly with other functions. Together these functions appear to 
represent over half of the positions listed in the National Park 
Service inventory. It is hard to argue that they shouldn't at least be 
evaluated through a competitive process.
    Our results demonstrate, more than anything else, the value of 
competition, and this is what the government has gained from the A-76 
program.
    I don't know if public workers will demonstrate that they are the 
best value to the department for all the current in-house work, as some 
say. Odds are they will prove themselves right in many instances. I do 
know that the process forces a comparison of alternatives. It will lead 
to the public workers identifying better ways to do their job and lead 
to private firms also offering better ways to do the job. The 
department will be in the position of choosing the best of these 
alternatives, using a process that forces a comparison with common 
performance standards and standardized costs.
    This is about leveraging our entire national workforce, public and 
private, in support of public objectives. This is about looking at all 
alternatives and not limiting our choices in performing public 
missions. We should do these competitions because they are part of good 
government.
    Again, I appreciate this opportunity to participate in the debate 
on this important issue. We will be glad to provide any of the detailed 
analysis to your staff or to the department. Thank you.

    Senator Thomas. Thank you very much.
    Mr. Segal.

  STATEMENT OF GEOFFREY SEGAL, DIRECTOR OF PRIVATIZATION AND 
        GOVERNMENT REFORM POLICY, THE REASON FOUNDATION

    Mr. Segal. Mr. Chairman, Senator Akaka, thank you again for 
inviting me today. It's a pleasure to be in front of you today. 
I am with the Reason Foundation. We're also a nonprofit 
research organization. We will be celebrating our 35th year 
anniversary in November, and we have been studying competitive 
sourcing, privatization, and government reform that entire 
time. I would like to provide a little perspective specifically 
to the national parks on what competitive sourcing means and 
could potentially mean to national parks.
    We just heard Mr. Kleinman say that 30 percent savings can 
be achieved and should be expected, but let's just assume that 
that margin is off, or that estimate is off by a margin of 50 
percent, and that parks, NPS would only achieve 15 percent 
savings. There are currently 2,200, or 1,700 positions of a 
commercial nature within national parks as deemed by the FAIR 
Act, and we did hear Director Mainella suggest to us that not 
all of those positions will be put up to competition.
    In fact, they're only looking at 850, but I suggest to you 
if we only look at 20 percent of those positions NPS could 
achieve savings well over $6 million, in fact $6.6 million, 
according to my calculations, assuming that NPS spends 
approximately $100,000 per position, which is NPS spending on a 
per-FTE basis. These savings seem small. However, this again 
only is relative to NPS, and if you incorporate the Department 
of the Interior and efforts Federal Government-wide, savings 
are much higher.
    Looking at this figure, though, $6.6 million, these 
translate into the treatment of over 40,000 additional acres of 
public lands deemed in danger of catastrophic wildfire, the 
same wild fires that we see at Glacier, in New Mexico, in 
Arizona and other national parks. We could also reprogram this 
money towards additional maintenance, or towards the additional 
cleaning of wetlands or degraded national parks, or possibly, 
and this is just an alternative, allow for free or reduced 
admission prices to some of our most popular national parks, 
Yellowstone Yosemite, Glacier, the Everglades, or perhaps the 
Statute of Liberty.
    If this committee wants to assume that direct Federal 
provision is the most efficient, they must fully understand 
what the tradeoff is and the cost associated with it. In this 
case, it is the opportunity for the national parks to better 
achieve its agency's mission and goals. Those are: one, to 
enhance and ensure environmental protection can be achieved 
through the provision of additional resources dedicated to 
wetland and degraded land cleanup; two, the public enjoyment of 
recreational facilities, again achieving this through 
additional work on the maintenance backlog; and three, public 
safety through the wildland fire program.
    And again, this is saying we may be wrong with the 30 
percent. Let's just assume 15 percent, but it clearly is better 
for the American taxpayer. The taxpayer and park visitors 
deserve the best service possible. Competitive sourcing gives 
national parks an opportunity to improve its efficiency, tackle 
its massive maintenance backlog, and focus its resources and 
energy on core functions, enhancing environmental protection, 
ensuring the availability and enjoyment of recreational 
facilities, and providing for public safety. Ultimately, 
competitive sourcing or competitive review can improve the 
quality and efficiency of our National Park System, in many 
regards the crown jewel of America.
    While there are associated up-front costs, and we heard 
Director Mainella discuss them, the demonstrated savings are 
significant, and competitions pay for themselves many times 
over. With that said, we also heard from Director Mainella that 
competitive sourcing and outsourcing in general is not new to 
national parks. I'll provide additional evidence that in 1998 
NPS was actually ordered to contract with private architectural 
and engineering firms for 90 percent of its design work and 
required that all construction oversight be handled by private 
firms.
    Additionally, House Report 105-163 directed the NPS to, 
quote, continue to increase its contracting of commercial 
activities with the goal of divesting itself of such activities 
by the end of fiscal year 1999. Furthermore, the report states, 
when services or products of equal quality and cost are 
available from the private sector, NPS should use the private 
sector.
    Competitive sourcing is an opportunity for NPS to look at 
its workforce, how to transition people, how to move people, 
how to make sure that they have the right mix of people, 
skills, and assets for the workforce they need today and the 
workforce they need in the future.
    Finally, NPS can learn a lot from its parent organization, 
the Department of Interior. They have developed a very 
systematic and effective competitive sourcing plan. There is a 
lot that can be learned from there, and what Interior has done 
can address many concerns that members of this committee and 
others would have.
    That is the end of my prepared testimony. I would be happy 
to answer questions.
    [The prepared statement of Mr. Segal follows:]

  Prepared Statement of Geoffrey Segal, Director of Privatization and 
            Government Reform Policy, The Reason Foundation

    Recently, the management of the National Parks Service (NPS) has 
been under a microscope. A series of financial lapses and a multi-
billion dollar backlog of maintenance and other work signal weak 
standards and general mismanagement. For example, ``in 1997, the NPS 
inspector general reported that officials at Yosemite used taxpayer 
money to build 19 staff homes for $584,000 each and in 2001, the 
General Accounting Office (GAO) acknowledged recent NPS efforts to 
overcome this troubled legacy but concluded that efforts had fallen 
short in several significant areas.'' \1\
---------------------------------------------------------------------------
    \1\ Ronald D. Utt, ``House Appropriators Undermine the President's 
Competitive Contracting Program,'' Heritage Foundation, Executive 
Memorandum No. 890, July 7, 2003.
---------------------------------------------------------------------------
    Additionally, park users themselves have noticed the poor condition 
of many of our national parks. In a recent Q&A with Interior Secretary 
Gale Norton \2\ two separate questions were posed regarding the 
condition national parks or the facilities that service the parks were 
in.
---------------------------------------------------------------------------
    \2\ Webcast on WashingtonPost.com

          Washington, D.C.: The last time I visited several well-known 
        national parks in the west, the roads were in very poor shape 
        with potholes, no shoulders for bicyclists, hard to read signs 
        and inadequate places to pull over to see park features. Is 
        fixing the roads in the parks part of the backlog your report 
        talks about?
          New York, N.Y.: Our national parks are in a bad state, with 
        backlogs and dilapidated facilities.

    These reports and observations cannot go unnoticed. Our national 
parks are the hallmark of what makes America a great nation. For too 
long, however, they have suffered from mismanagement as maintenance and 
much-needed upgrades and additions have gone unfinished. The 
President's Management Agenda (PMA) is a set of initiatives designed to 
improve the management of federal agencies by adopting performance-
based criteria for decision-making and action. Competition or 
competitive sourcing is a major component of the PMA, which simply 
means a systematic effort to have commercial activities in the federal 
government periodically go through a process of competition.
    The competitive sourcing initiative forces agencies to put their 
fingers on their own pulse. It provides a framework by which agencies 
examine whether they have the right skill sets, technologies and 
organization structure to provide Americans the best possible service--
service that is effective and efficient. Through the initiative, 
agencies review certain tasks and activities, evaluating whether they 
can re-engineer the work to improve service quality. Contrasting the 
status quo and the re-engineered option with what a private firm, or, 
potentially, even what a state or local government might charge to 
perform the same work. The bottom line is that these evaluations are 
used to determine and provide the best value to citizens.
    Competitive sourcing has two oft-overlooked related benefits. 
First, it allows agencies to refocus on core functions and mission-
critical activities. Secondly, it helps them address their human 
capital management. Essentially, it enables federal managers to rethink 
the structure of their workforce.
    The federal government human capital management challenges have 
been well documented--while not as severe as originally thought, the 
problem continues to persist. Competitive sourcing provides a unique 
opportunity to agencies in managing the structure of the workforce. Put 
simply, incorporating competitive sourcing into the broader context of 
human capital challenges creates linkages and improves flexibility. 
Agencies could move existing staff between agencies or within the 
agency to activities considered core or mission-critical as needed. 
Competitive sourcing is a means of tapping new sources of human capital 
to meet current service needs. Indeed, competitive sourcing is 
fundamentally about accessing new pools of talent.
    Essentially competitive sourcing is a tool that redeploys human 
capital. A common misconception about competitive sourcing is that it 
leads to layoffs and to loss of pay and benefits for workers. But a 
long line of research shows that in fact the majority of employees are 
hired by contractors or shift to other jobs in government while only 5-
7 percent are laid off.\3\ In fact, competition leads one portion of 
existing human capital to join with the new human capital the 
contractor brings to the table, and either or both may be utilized in 
new ways to meet the goals of the government agency. Private 
contractors are more able to cross-train and develop workers to meet 
human capital needs.\4\ At the same time, the government agency can 
redeploy many workers who did not switch employment to the private 
contractor and can retrain and reposition them to meet other human 
capital challenges. Agencies already do have tools that have assisted 
them with human capital issues in the past, and these remain promising 
tools for the future--especially with moving resources and personnel 
around. The Office of Personnel Management mandates that agencies 
prepare both a Career Transition Assistance Plan (CTAP) and Interagency 
Career Transition Assistance Plan (ICTAP) when a reduction in force 
(RIF) is expected or when an activity is being competitively sourced. 
These programs give managers an additional tool to fill needs and 
strategically focus on service delivery.
---------------------------------------------------------------------------
    \3\ Robin Johnson, Privatization and Layoffs: The Real Story, 
Reason Public Policy Institute E-brief 112, (Los Angeles: Reason 
Foundation, 2001), http://www.Mpi.org/ebriefl12.html. Moreover, 
research by the GAO shows that as many employees saw increases in pay 
and benefits as saw cuts in pay and benefits after going to work for 
contractors General Accounting Office, DoD Competitive Sourcing: 
Effects of A-76 Studies on Federal Employees' Employment, Pay, and 
Benefits Vary, GAO 01-388 (Washington, D.C.: GAO, 2001).
    \4\ Research shows that privatization tends to lead to more 
investment in education and human capital development in workers. See 
Mike Wright, Robert E. Hoskisson, Igor Filatotchev, and Trevor Buck, 
``Revitalizing Privatized Russian Enterprises'' Academy of Management 
Executive, v.12, No. 2, 1998, pp. 74-85, and Yuming Fu and Stuart 
Gabriel, ``Location, Market Segmentation, and Returns to Human Capital: 
The Privatization of China's Labor Markets,'' Paper presented at the 
Annual Meetings of the American Real Estate and Urban Economics 
Association, Boston, January 2000.
---------------------------------------------------------------------------
    Competitive sourcing creates three opportunities for meeting human 
capital challenges: a) it is a means of bringing in private sector 
human capital to meet government service needs, b) if competitive 
sourcing displaces some government workers, they can be redeployed and 
retrained to meet yet other human capital challenges, and c) it changes 
the way existing human capital is utilized.
    With this said, competitive sourcing is not new to NPS. In fact, in 
1998 NPS was ordered to contract with private architectural-engineering 
firms for 90 percent of its design work and required that all 
construction oversight be handled by private firms. Additionally, House 
report 105-163 directed the NPS ``to continue to increase its 
contracting of commercial activities, with a goal of divesting itself 
of such activities by the end of fiscal year 1999.'' Furthermore, the 
report stated that ``when services or products of equal quality and 
cost are available from the private sector, the [NPS] should use the 
private sector.''
    Additionally, the NPS parent department has used competitive 
sourcing very systematically and effectively. NPS can learn and use 
this approach. For example, from the start, Interior worked with the 
unions and has kept costs down. Furthermore, transition strategies were 
identified for affected employees. And while more than 1,800 positions 
have been competed, not a single employee was left without a job. In 
fact, the employee bid has won more times than the private bidder. 
Additionally, in an effort to mitigate impact in one area, competitions 
have been balanced; competitions have been targeted in different 
locations and different pay grades.
    So what does all this mean? How can NPS benefit from implementing a 
competitive sourcing plan? There is overwhelming evidence that 
competitive sourcing saves significant money.\5\ While studies show 
that the average savings are 30 percent--assuming that this is off by a 
margin of 50 percent and that savings are truly only 15 percent--of 
16,000 NPS employees only 2,200 positions have been identified as 
commercial in nature. Competing only 20 percent of those would result 
in savings of $6.6 million in the first year alone (assuming that NPS 
spends $100,000 on the average position, which is total NPS spending on 
a per FTE basis). These savings may seem small, but this represents 
only NPS competitive sourcing efforts. The savings are much, much 
higher if you incorporate the entire Department of Interior competitive 
sourcing plan.
---------------------------------------------------------------------------
    \5\ The General Accounting Office and the Center for Naval Analysis 
have found significant savings from competitive sourcing. Savings 
average 30 percent.
---------------------------------------------------------------------------
    With that said though, these savings translate into the treatment 
of over 40,000 additional acres of public lands deemed in danger of 
catastrophic wildfire; or $6.6 million dollars of additional 
maintenance, reducing the backlog plaguing our national parks; or 
allowing for more funds to be transferred into cleaning additional 
acres of wetlands or degraded lands in our nation's parks; or best yet, 
allowing for free admission to popular national parks like Yellowstone, 
Yosemite, Glacier, the Everglades, or the Statue of Liberty.
    If this committee wants to assume that direct federal provision is 
the most efficient, it must fully understand what the tradeoff is, and 
the costs associated with it. In this case, competitive sourcing 
provides the opportunity for NPS to better achieve its agency's mission 
and goals:

          1. Enhance and ensure environmental protection (wetland and 
        degraded land cleanup);
          2. Public enjoyment of recreational facilities (maintenance 
        of facilities); and
          3. Public safety (wildland fire program)

    Again, even if we're wrong about the 30 percent and savings are 
only 15 percent, this is better for the American taxpayer.
    Some opponents of competitive sourcing insist that our national 
parks are special, and that they should be shielded from competition. 
However, several states and provinces in Canada have long used 
competitive sourcing and the private sector to provide services in 
their respective park systems. In fact, according to the Council of 
State Governments, parks departments that were surveyed ``were more 
likely than other [executive] agencies to expand [competitive sourcing] 
in the past five years.'' \6\ Reasons for seeking competitive sourcing 
were reduced costs, additional personnel and greater expertise. 
Respondents also expect the trend to continue for the next five years, 
with almost three quarters of the respondents stating that they expect 
to use competitive sourcing ``more frequently in the coming years, and 
most others will maintain current levels.'' \7\
---------------------------------------------------------------------------
    \6\ Keon Chi and Cindy Jasper, Private Practices: A Review of 
Privatization in State Government (Lexington, Ky.,: Council of State 
Governments, 1998) p. 40-1.
    \7\ Ibid.
---------------------------------------------------------------------------
    Of those agencies that had competed services, ``a large portion of 
parks agencies are saving more than 15 percent of their budgets through 
competitive sourcing.'' \8\ This evidence further justifies the claims 
of at least 15 percent savings from competitive sourcing. Many services 
that would be competed by NPS were also competed by the states. Those 
services include: construction, maintenance and janitorial services, 
operation of individual parks, custodial services, security services, 
vehicle maintenance, recreational programs and services.
---------------------------------------------------------------------------
    \8\ Ibid.
---------------------------------------------------------------------------
    While several states and many cities in the United States have 
successfully used competitive sourcing and privatization at state and 
local parks, some of the most interesting examples are efforts of 
Canadian provincial park systems. Note that Canada's park systems have 
faced budget pressures even more severe than those plaguing park 
systems in the United States.

Alaska
    Beginning in the 1990s Alaska State Parks began contracting out the 
operation of a small number of campgrounds.\9\ Currently the department 
contracts out seven small and isolated parks. Because of their 
isolation, the parks were costly (relative to revenues) for the 
department to maintain. Contract lengths are short, running from one to 
five years. In return for meeting maintenance standards, operators keep 
the camping fees and have their commercial use permit fee waived. 
Indicative of the department's satisfaction with contracting out, 
Alaska Parks is currently proceeding with a plan to contract out the 
operation of a ``top-flight'' park, Eagle River.
---------------------------------------------------------------------------
    \9\ The information that follows is from Pete Panarese, Chief of 
Operations, Alaska State Parks, phone conversation with Jeff Hanson, 
Washington Policy Center, September 7, 1999.
---------------------------------------------------------------------------
Newfoundland
    The experience of Newfoundland is significant because of the 
magnitude of its competitive sourcing efforts. In 1997, faced with a 
$1.8 million \10\ cut in its small budget of $3.2 million, 
Newfoundland's Parks and Natural Areas Division competitively sourced 
21 of its 34 provincial parks.\11\ The 21 parks were rural, primitive 
parks, with low usage. All parks remain public land (Crown Land); some 
agreements are leases of duration of up to 50 years, while others are 
short-term ``licenses to occupy.'' Significantly, during their first 
season, 13 operators at the privatized parks made capital improvements, 
thus using profit incentives instead of tax dollars to mobilize 
resources to upgrade park facilities.\12\ Under private management, the 
parks no longer need public financing. In fact, the parks are modest 
revenue producers despite the capital improvements. Bottom line is that 
they now better serve the public, at no cost to taxpayers.
---------------------------------------------------------------------------
    \10\ This and all subsequent dollar figures reported in the context 
of provincial park systems are in Canadian Dollars.
    \11\ Government of Newfoundland and Labrador, Department of 
Tourism, Culture and Recreation, ``Doing Things Differently,'' 
departmental submission for 1998 Institute of Public Administration of 
Canada (IPAC) Award for Innovative Management.
    \12\ Sandra Kelly, Minister of Tourism, Culture and Recreation, 
Government of Newfoundland and Labrador, ``Update on Parks 
Privatization Initiative,'' news release, 18 December 1997. Available 
at http://www.gov.nf.ca/releases/1997/tcr/1218nO5.htm.
---------------------------------------------------------------------------
British Columbia
    In 1988, B.C. Parks began using private sector contractors to 
operate its parks; by 1992, the department contracted out 100 percent 
of park maintenance and operations. In FY 1998, visitor satisfaction 
was high: 81 percent of visitors rated park facilities and services as 
excellent or above average. The department has also realized 
substantial savings, estimated at 20 percent on average.\13\
---------------------------------------------------------------------------
    \13\ Jeff Hanson, ``Privatization Opportunities for Washington 
State Parks,'' Washington Policy Center, 2000, http://www.wips.org/
ConOutPrivatization/PBHansonCOStateParksPrivatize.html
---------------------------------------------------------------------------
Alberta
    In 1997, Alberta decided to expand its already extensive use of 
private sector operators of its park and recreational facilities. 
During earlier budget reductions, the agency used competitive sourcing 
to withstand cuts, while at the same time actually increasing the size 
of its recreation and protected areas network. Utilizing a new 
management strategy that is eerily similar to the NPS core goals 
(preservation, heritage appreciation, outdoor recreation and tourism), 
despite seeing its budget reduced by $11 million over a four year 
period and another $6 million two years later, the department added 34 
undeveloped sites to the network over a 25-month period beginning in 
March 1995. This was primarily achieved through the use of competitive 
sourcing.
    The department enlisted private operators in those program areas 
where they are firmly established. Doing so helps free department 
resources from routine operational and maintenance duties, allowing 
them to focus more on planning and managing protected landscapes and 
resources inventory, delivering heritage appreciation and environmental 
education, managing contracts and partnerships, and coordinating 
volunteer efforts.\14\
---------------------------------------------------------------------------
    \14\ Alberta Environmental Protection, Natural Resources Service, 
``Completing the Puzzle: Building a Recreation and Protected Areas 
Network. for the Next Century,'' executive summary, May 1997. Available 
at http://www.gov.ab.ca/env/parks/strategy/summary.html. p.14-15. See 
Jeff Hanson, ``Privatization Opportunities for Washington State 
Parks,'' Washington Policy Center, 2000, http://www.wips.org/
ConOutPrivatization/PBHansonCOStateParksPrivatize.html
---------------------------------------------------------------------------
    Despite the benefits of competitive sourcing there remains 
skepticism and objections to the initiatives. Some of the more common 
objections include:
    NPS is inherently governmental, and should be shielded from 
competition.
    Ultimately, NPS will determine what activities within the agency 
are commercial in nature, what could be competed, and what actually 
will be competed. It will determine this based upon the FAIR act and an 
analysis of its workforce without compromising the core mission of 
agency. Prohibiting NPS from studying its workforce and determining 
where efficiencies can be achieved will only hamstring the agency from 
achieving its goals.
    Competitive sourcing also enables the agency to better focus on its 
mission. The agency can and should focus resources on mission-critical 
activities and utilize contractors where possible, especially in 
services like lifeguarding, janitorial, maintenance, computer 
technicians, and ticket takers.
    NPS diversity will suffer.
    For starters, competitions can be targeted at locations that don't 
have diversity issues. Two other issues come to mind too; first, 
contractors that win competitions will rely on local labor markets to 
fill positions. Thus, diversity goals will likely be met regardless of 
who is providing the service. Secondly, NPS can use competitive 
sourcing to further its diversity goals by identifying competitions and 
contractors that will advance its policy. Additionally, diversity 
concerns assume that the contractors will violate civil rights laws or 
that minority workers cannot compete with whites and must be sheltered 
by an undemanding civil service code.
    No cost savings will be achieved.
    The Department of Defense (DOD) has the greatest amount of 
experience in competitive sourcing of all U.S. agencies. Between 1978 
and 1994 over 3,500 competitions were initiated by DOD involving 
145,000 personnel. The competitions resulted in an estimated annual 
savings of $1.46 billion (FY 1996 dollars).\15\ Had the DOD competed 
the entire inventory of competeable positions, over 13,000 functions 
employing over 380,000 personnel, competitions would have generated 
$7.58 billion in annual savings.\16\
---------------------------------------------------------------------------
    \15\ Christopher M. Synder, Robert P. Trost, and R. Derek Trunkey, 
``Reducing Government Spending with Privatization Competitions: A Study 
of the Department of Defense Experience,'' George Washington University 
Working Paper, 2000.
    \16\ Ibid.
---------------------------------------------------------------------------
    The data show an average savings of 31 percent of the baseline 
cost,\17\ and that a majority of competitions remained in-house. 
However, it also shows that DOD strategically used resources in the 
most effective and productive manner by subjecting positions to 
competition. DOD was able to focus more on core functions after 
resources were freed up from outsourcing. Even if forecasts of savings 
are wrong by a margin of 50 percent (i.e., savings only equal 15 
percent) those are still significant savings. As taxpayers, we should 
not automatically assume that federal employees are as efficient as 
they could be. Without even the threat of competition, agencies can 
grow stale and inefficient, as evidenced just last year.
---------------------------------------------------------------------------
    \17\ Ibid.
---------------------------------------------------------------------------
    In 2002, OMB decided to use competition in response to poor 
performance by the Government Printing Office and offered the job of 
printing the fiscal 2004 federal budget to competitive bidding. Simply 
indicating that the agency would be required to compete, i.e., OMB no 
longer assumed that they were as efficient as they could be, the GPO 
turned in a bid that was almost 24 percent lower than its price from 
the previous year. That was $100,000 a year that GPO could have saved 
taxpayers any time it chose, but it never chose to do so until it was 
forced to compete.
    There will be negative impact on rural communities.
    There are real concerns that competitions will lead to work being 
taken out of local communities, especially rural ones. However, the 
projects NPS will be competing are mostly small competitions where the 
work cannot be transferred away from the locations. Put simply, 
maintenance activities cannot be removed from the locations. 
Additionally, large companies like Bechtel will not be competing for 
these jobs. If the in-house team does not win the competition, the 
winners are actually likely to come from the local communities serving 
the location. Thus, economic activity will increase, not decrease. 
Additionally, private companies pay taxes while government doesn't, 
creating additional economic activity for local rural communities.
    The American taxpayer and park visitors deserve the best services 
possible. Competitive sourcing gives NPS an opportunity to improve its 
efficiency, tackle its massive maintenance backlog, and focus its 
resources and energy on its core functions. Ultimately, competitive 
sourcing can improve the quality and efficiency of our national park 
system--in many regards the crown jewel of America. While there are 
associated up-front costs, the demonstrated savings are significant and 
competitions pay for themselves many times over.
    Competitive sourcing gives NPS a valuable opportunity to focus on 
the agency's mission and goals of enhancing environmental protection, 
ensuring the availability and enjoyment of recreational facilities, and 
providing for public safety. Again, the goal should be about improving 
the service that is provided to the American taxpayer, both in terms of 
quality of service, but also in terms of cost. Can we assume that 
federal employees are the most efficient and effective given the 
backlog of maintenance work and past mismanagement issues? We must 
fully understand what the tradeoff and resulting costs are in stifling 
the NPS competitive sourcing initiative. In this case, it is mandating 
inefficient management and lesser quality parks for the American 
taxpayer.

    Senator Thomas. Mr. Wade.

  STATEMENT OF J.W. (BILL) WADE, ON BEHALF OF THE CAMPAIGN TO 
   PROTECT AMERICA'S LANDS AND A COALITION OF CONCERNED NPS 
                            RETIREES

    Mr. Wade. Thank you, Mr. Chairman, Senator Akaka. I 
appreciate being here today. My name is Bill Wade. I retired in 
1997 after over 30 years with the National Park Service, and 
following just over 9 years of superintendent of Shenandoah 
National Park. I'm representing the Campaign to Protect 
America's lands and also approximately 100 retired National 
Park Service employees, many of whom or most of whom are senior 
managers. We are among those people that Senator Bingaman just 
talked about, folks that are deeply troubled about what is 
happening to the agency to which we devoted our careers.
    Policy and political assaults are undermining the ability 
of the National Park Service to carry out its intended mission 
on behalf of the American people. We've heard a number of 
people and the witnesses already before us speak of the 
competitive sourcing initiative as focusing on cost, on 
competition, and we don't hear much about effectiveness, value, 
and benefit.
    We question the wisdom of competitive sourcing if it 
ignores the fact that Federal agencies are different from one 
another. It may be arrogant to suggest that the National Park 
Service is different from a number of other agencies, but I 
think most people would agree that it is.
    We question the wisdom of it if it ignores less destructive 
ways to achieve organizational effectiveness, and if it means 
that money supersedes visitor experiences, resource protection, 
conservation values, and undermines the reasons for parks, all 
in the interest of competition and privatizing activities to 
carry out sometimes arbitrary numerical targets.
    One of the things that we're concerned about is that many, 
if not most of the positions in the National Park Service are 
multidisciplinary nature. I think this was mentioned by one of 
you earlier. As Superintendent of Shenandoah National Park, for 
instance, I had roughly 200 employees. About half of those 
people were maintenance employees. Of that half of the 
maintenance employees, about 30 percent of them were qualified 
and certified to fight wildland fire, and did so frequently.
    I had interpreters, resource management, and administrative 
employees similarly qualified and engaged, and many of those 
same folks were routinely involved in search and rescue 
operations. The same was true to have a skeleton structural 
fire response capability for places like Big Meadows Lodge and 
Skyland.
    Maintenance and interpretive employees were often the first 
to arrive at motor vehicle accidents, and because they were 
frequently trained in emergency medical techniques, they 
regularly treated victims, and they assisted with traffic 
control.
    Because of their numbers and their availability and their 
knowledge of the park, maintenance employees typically answered 
visitor questions and interpreted park features more than any 
other category of employees. My friend Deb Liggett, who is now 
the Superintendent of Lake Park National Park and was a 
district interpreter in Everglades National Park when Hurricane 
Andrew hit, after several days of preparing the park, here is 
what she had to say about the day that the hurricane was 
predicted to hit land. She said, our goal was to release the 
employees by noon so they could go home and take care of their 
families. This worked pretty well for the majority of our 
employees, and we had most of them out of the park by 1 p.m. 
The early release worked except for some particularly pig-
headed, stubborn maintenance folks who simply would not quit. 
They just wouldn't quit.
    I defy anyone to tell me how the commitment, dedication, 
expertise, and multidisciplinary capability that I just 
described could ever be replicated by contracting out. For 
years, the National Park Service has had nationally and 
internationally renowned experts in a number of fields. Where 
do these experts come from? Senator Bingaman mentioned they 
come through the ranks. They start somewhere. They develop 
their expertise as they advance upward.
    What happens if competitive sourcing reduces this level of 
expertise? Many positions in science and resource management 
that are targeted for competitive sourcing serve as the eyes 
and ears of park managers and their efforts to carry out the 
mission. Can we rely on contractors, who are unlikely to have 
either the levels of expertise or mission commitment, to 
provide such critical information to decisionmaking?
    The National Park Service, Director Mainella mentioned, has 
over 1 million hours of volunteer effort each year. What is the 
likelihood that volunteers are going to continue to help if 
they see their efforts contributing to profit in the private 
sector?
    So as we see it, the cost of competitive sourcing proposed 
by the administration go far, far beyond just the expenses of 
the studies and the contract administration. The costs are 
unlikely to be recoverable, and far more damaging to the 
organization's ability to effectively meet its mission mandate 
and maintain the public's respect and support.
    In summary, right now in the NPS because of the threat of 
competitive sourcing and other things, other assaults on the 
integrity and mission of the National Park Service, morale is 
the lowest that any of us have seen in up to 50 years. What is 
at risk is reducing a once proud, highly productive workforce 
in an agency with immense public respect and admiration into a 
run-of-the-mill government bureaucracy.
    Is that what the citizens of America want? I think not. We 
would urge you of the subcommittee to influence the use of this 
competitive sourcing and look at other ways to reach more 
effectiveness, value, and benefit, and not just focus on cost, 
efficiency, and competition.
    Thank you, and I'll be prepared to answer any questions the 
subcommittee might have.
    [The prepared statement of Mr. Wade follows:]

 Prepared Statement of J.W. (Bill) Wade, on Behalf of the Campaign To 
   Protect America's Lands and a Coalition of Concerned NPS Retirees

    Chairman Thomas and Members of the National Parks Subcommittee: I 
appreciate the opportunity to appear before the Subcommittee and to 
provide this statement for the record.
    My name is Bill Wade, and I was a second-generation National Park 
Service (NPS) employee, retiring in 1997 after over 30 years with the 
agency. I retired following just over nine years as Superintendent of 
Shenandoah National Park. One might accurately say that my life was 
devoted to the mission of the NPS.
    I am representing the Campaign to Protect America's Lands and also 
approximately 100 retired National Park Service employees many of whom 
were senior managers including one former Director, two former Deputy 
Directors, seven former Regional Directors, 23 other former Washington 
and Regional senior managers and 35 former Superintendents. Many of us 
received Distinguished Service and Meritorious Service Awards for our 
commitment and stewardship of our great National Parks
    We, the former NPS employees I represent and I, are deeply troubled 
about what is happening to the agency to which we devoted our careers. 
Never before have we seen so many simultaneous assaults on the purposes 
for which the National Park System exists. Such assaults are 
undermining the role of the National Park Service professionals who 
steward our great natural and cultural legacy and such assaults are 
contributing to the failure of the National Park Service to carry out 
its intended mission on behalf of the American public.
    The consequences of a number of policies, proposed legislative 
changes and actions being taken or proposed by the current 
Administration are contributing dangerously to the failure of the NPS 
to carry out its intended mission on behalf of the American public. 
Moreover, we believe that the combined effects of these efforts could 
be in violation of the P.L. 91-38 which amended the Act of 1916 
establishing the National Park Service. This Act states: ``that the 
National Park System . . . has grown to include superlative national, 
historic, and recreation areas . . .; that these areas, though distinct 
in character, are related through the inter-related purposes and 
resources into one national park system as cumulative expressions of a 
single national heritage. . . .'' The Congress further emphasized the 
importance of preserving and protecting the resources contained within 
the units of the national park system in the Redwoods Act of 1978 (P.L. 
95-250) when it declared: ``. . . authorization of activities shall be 
construed and the protection, management, administration . . . shall be 
conducted in light of the high public value and integrity of the 
National Park System and shall not be exercised in derogation of the 
values and purposes for which these various areas have been 
established, except as many have been or shall be directly and 
specifically provided by Congress.'' This rule of law is not being 
followed under this Administration's policies.
    One such assault on the integrity of the National Park Service and 
System is the ``competitive sourcing'' initiative, about which we are 
here today to discuss.
    The President's Management Agenda, FY2002 provides insight to the 
mind-set guiding this initiative. In the competitive sourcing section, 
we see statements such as:

   Nearly half of all federal employees perform tasks that are 
        readily available in the commercial marketplace--tasks like 
        data collection, administrative support, and payroll services. 
        Historically, the government has realized cost savings in a 
        range of 20 to 50 percent when federal and private sector 
        service providers compete to perform these functions. 
        Unfortunately, competition between public and private sources 
        remains an unfulfilled management promise. By rarely subjecting 
        commercial tasks performed by the government to competition, 
        agencies have insulated themselves from the pressures that 
        produce quality service at reasonable cost.
   Competition promotes innovation, efficiency, and greater 
        effectiveness. For many activities, citizens do not care 
        whether the private or public sector provides the service or 
        administers the program. The process of competition provides an 
        imperative for the public sector to focus on continuous 
        improvement and removing roadblocks to greater efficiency.
   By focusing on desired results and outcomes, the objective 
        becomes identifying the most efficient means to accomplish the 
        task.

    This agenda centers on cost, efficiency and competition. Nowhere do 
we see any reference to value and benefit.
    The pitfalls of a process driven largely by the single dimension of 
efficiency are many. Dr. Bruce Hutton of the University of Denver has 
been consulting on organizational effectiveness for the Intermountain 
Region of the NPS. He describes the dangers:

          ``Because efficiency is such a prominent construct in the 
        competitive sourcing initiative, some time should be spent 
        placing it in an appropriate context. Efficiency can be defined 
        as the choice of alternatives that produces the largest result 
        for a given application of resources. The potential problem for 
        NPS is not in the definition per se, but rather how it is most 
        often operationalized. It has been shown many times over that 
        efficiency does not translate to the greatest benefit for the 
        cost. It usually means the greatest measurable benefit for the 
        greatest measurable cost. Management obsessed with efficiency 
        is one obsessed with measurement. The results can be 
        disastrous. Because economic benefits are typically more easily 
        measured then social benefits, efficiency may drive the 
        organization toward a kind of economic morality and social 
        immorality.
          ``James Hillman writes that `Two insanely dangerous 
        consequences result from raising efficiency to the level of an 
        independent principle. First, it favors short term thinking--no 
        looking ahead or down the line; and it produces insensitive 
        feeling--no looking around at the life values being lived so 
        efficiently. Second, means become ends; that is doing something 
        because the full justification of doing is the doing, 
        regardless of what you do.' He argues that specialization 
        strips decisions of their ethical context, and undoes breadth 
        of vision and any sense of balance. It is anti-humanistic.
          ``Efficiency emerges, in practice not as a neutral concept 
        but as one associated with a specific system of values--
        economic values. It is argued that too much emphasis on 
        organizational efficiency will eventually destroy 
        organizational effectiveness. Putting systems ahead of people 
        gradually destroy the quality of human capital to contribute 
        anything to the organization but rote function. Efficiency is 
        recognized as a legitimate value for the park system, along 
        with the mission driven values of protection and sharing, plus 
        community as representative of the variety of relevant 
        stakeholders associated with parks (e.g., gateway communities, 
        society, Native Americans, etc.).''

    We have seen what can happen when organizations, such as Enron and 
Arthur Anderson, engage in short run efficiency behaviors with 
disastrous consequences for community. This lack of balance of values 
destroyed the companies' credibility and ultimately their ability to 
even function.
    We question the wisdom of competitive sourcing if it means money 
supercedes visitor experiences, resource protection, conservation 
values, and undermines the reasons for parks, all in the interest of 
competition and privatizing activities to meet arbitrary numerical 
targets.
    We are fearful that the competitive sourcing initiative, if it is 
applied to the National Park Service as it is currently constructed, 
will have similar consequences.
    The current effort to implement the competitive sourcing initiative 
ignores two important considerations that I want to expand on:

   First, it ignores the fact that the federal agencies are 
        different from one another. Typically, the expectation is that 
        competitive sourcing must be implemented the same way in the 
        NPS as it is in the Department of Defense and in the Internal 
        Revenue Service. Someone once said that, ``nothing is as 
        unequal as the equal treatment of unequals.'' Dr. Hutton 
        states: ``The most effective NPS, and individual parks, must 
        balance the value of efficiency with the other key values of 
        protection, sharing, and community.'' He goes on to assert, 
        ``After all, our forefathers did not create our democracy and 
        the governance process based on efficiency. Markets are 
        certainly meant to be efficient, but they are not meant to be 
        fair or to treat all stakeholders equally. Government, on the 
        other hand, was not designed with efficiency as its primary 
        characteristic. Nor were national parks created with efficiency 
        in mind as the critical component. The role of government and 
        the parks is different, and it was meant to be. The governance 
        structure that was designed to play out democracy in this 
        country was designed to be effective in protecting and 
        balancing those values citizens hold most dear.''
   Second, in its attempt to cut costs and reduce the federal 
        workforce, the competitive sourcing initiative ignores other 
        less destructive ways to achieve organizational effectiveness. 
        It focuses on short-term cost reduction while ignoring the long 
        term consequences and the greater question of how best to 
        define and maximize value and benefit.

                 THE NATIONAL PARK SERVICE IS DIFFERENT

    Perhaps unlike any other federal agency, many, if not most, of the 
positions in the NPS are ``multi-disciplinary'' in nature. This is of 
necessity, and largely has resulted from the critical staff shortages 
that have plagued the Service for decades.
    In a perfect world, plumbers would plumb, trails laborers would 
build and fix trails, guides would guide, rescues would be carried out 
by rescue specialists, structural fires would be suppressed by firemen, 
and administrative technicians would do technical administrative work. 
Taken literally, many of these kinds of positions could be performed by 
federal employees--or not. Such a perfect world does not even come 
close to describing the situation in the NPS.
    In the parks, rarely does an employee perform his or her job, over 
a period of time, limited to what might be defined in the 
``Occupational Series'' to which he or she is classified. One's 
position description might quite appropriately portray and classify his 
or her principal duties as a Maintenance Worker, but in reality up to 
30% or more of this employee's time might be spent performing other 
necessary duties to meet the demands dictated by the conditions in the 
park at any given time.
    When I was Superintendent of Shenandoah National Park, I had 
between 175 and 225 employees (permanent and temporary), depending on 
the budget. About half of those were maintenance employees in various 
occupations. About 30% of those maintenance employees were ``red-
carded'' for wildland fire, and many would be gone to work on large 
fires elsewhere on public lands (not always in NPS areas) for 
significant periods during the fire seasons. Moreover, I had 
interpreters, resource management and administrative employees 
similarly qualified and engaged. Maintenance and resource management 
personnel and others were routinely used in search and rescue 
operations. The same was true to have a skeleton structural fire 
response capability for places like the Big Meadows Lodge and Skyland. 
Backcountry patrol rangers routinely did minor trail and campsite 
maintenance. Maintenance and interpretive employees were often the 
first to arrive at a motor vehicle accident, and because they were 
trained in emergency medical techniques, regularly treated victims; and 
they assisted with traffic control. Because of their numbers, their 
availability and their knowledge of the park, maintenance employees 
typically answered visitor questions and ``interpreted'' park features 
more than any other category of employees. Many employees had 
``collateral duties'' required of them to meet agency-dictated 
functions and committee assignments in areas such as safety, equal 
opportunity and property management.
    Underpaid and over-worked park employees like to say that they are 
``paid in sunsets.'' These dedicated folks often find themselves 
working long hours for no extra pay, and doing so out of love and 
dedication to the parks. Try as I might, as a supervisor and manager, 
to get employees to work within their schedule, many of them 
essentially refused. They are there not for the profit; they are there 
because many of them are the lucky people who love what they do. They 
are dedicated and passionate about the places where they work. They are 
there for the resource. They believe they are ``on the side of the 
angels'' in carrying out the mission of the NPS.
    I defy anyone to tell me how this commitment, dedication, expertise 
and multi-disciplinary capability can ever be replicated by contracting 
out. I have tried, and I've never been able to have anyone, even the 
so-called competitive sourcing experts, tell me how you write a 
contract proposal to capture these factors.
    Dr. Hutton acknowledged this special quality in NPS employees:

          ``Employees are the parks. Employees of parks cannot be 
        considered as simply factors of production, interchangeable and 
        disposable. In much the same way you cannot separate the barber 
        from the haircut, the surgeon from the operation, or the chef 
        from the meal; many park employees are inseparable components 
        of their park. They are part and parcel of the whole. Such jobs 
        deserve careful attention to defining job performance 
        specifications and evaluation criteria, in order not to lose 
        productivity and effectiveness in the name of efficiency.''

   EFFECTIVENESS, SUSTAINABILITY AND VALUE AND BENEFIT SHOULD BE THE 
            DRIVERS OF ORGANIZATIONAL PERFORMANCE IN THE NPS

    In this context, a definition of ``sustainability'' put forth by 
the World Bank is applicable: Sustainability is a process whereby 
future generations receive as much, or more, capital per capita as the 
current generation has available.
    We could (and should) define value and benefit and effectiveness as 
they apply to the NPS as its ability to maintain a sustainable balance 
among the numerous values that define parks for the American people in 
the fulfillment of its mission.
    Effectiveness is inherently tied to determinants of quality. The 
criteria used to measure effectiveness are not value-neutral. They are 
typically based on the values and preferences of individuals.
    Public sentiment is a good indicator of the extent to which the NPS 
is fulfilling the values and preferences of the American citizens. For 
as long as I can remember, the NPS is regularly listed at or near the 
top of the public's list of ``most valued and respected government 
agencies.'' The NPS must be doing something right.
    For years, the NPS has been recognized, and admired, as having 
nationally and internationally renowned experts in a number of fields, 
such as archaeology (including underwater archaeology), cave 
management, search and rescue, wildland fire management, and in many 
other disciplines. Where do these experts come from? They start in many 
of the positions that under the competitive sourcing initiative could 
be contracted out to the private sector. They develop their expertise 
as they advance up their chosen occupations. What happens if 
competitive sourcing reduces this level of expertise in the NPS, as it 
inevitably would?
    Many of the positions--especially those in the sciences and 
resource management--that are targeted for competitive sourcing serve 
as the ``eyes and ears'' of park managers in their efforts to carry out 
the mission to ``. . . conserve the scenery and the natural and 
historic objects and the wildlife therein and to provide for the 
enjoyment of the same in such manner and by such means as will leave 
them unimpaired for the future generations.'' \1\ Such positions are 
essential for managers to achieve ``situation awareness''--the ability 
to perceive what is happening in the parks, the ability to comprehend 
the importance of what is happening, and the ability to predict the 
future outcome of those happenings. Can we rely on contractors, who are 
unlikely to have either the levels of expertise or the mission 
commitment to provide such critical situation awareness?
---------------------------------------------------------------------------
    \1\ From the National Park Service Organic Act of 1916.
---------------------------------------------------------------------------
    And what about those functions that already are being performed by 
non-federal individuals and organizations? The NPS benefits from over 
one million hours of volunteer effort each year. How likely is it that 
these volunteers will continue to contribute if many of the functions 
to which they currently volunteer are contracted out? For example, 
Mount Rainier National Park receives approximately 7000 hours each year 
in volunteer effort directed at backcountry management. The 67 
positions in the Maintenance Division are currently on the list to be 
studied for competitive sourcing. The Superintendent there has already 
been informed by several of the volunteer groups that if backcountry 
maintenance is contracted out, there is no way those groups will 
continue to volunteer their efforts to help a private contractor make a 
profit. Other managers are hearing similar chords of discontent from 
Friends groups and volunteers.
    So, the costs of the competitive sourcing proposed by this 
Administration go far, far beyond just the expenses of the studies and 
the contract administration. The costs of the loss the institutional 
capacity of the NPS to maintain a sustainable ``critical mass'' of 
expert, highly committed employees and the loss of volunteer 
contributions, among other casualties, are likely to be unrecoverable 
and far more damaging to the organization's ability to effectively meet 
its mission mandate and maintain the public's respect and support.

                         THERE IS A BETTER WAY

    The National Park Service is not against contracting out as one 
method of improving organizational effectiveness. It has engaged in 
significant contracting out over the years, and continues to do so even 
without the pressures of the current competitive sourcing initiative.
    But it's clear that many Administration appointees view competitive 
sourcing as the ``end''--to be valued on its own merits--rather than a 
means to an end. For example, Interior Assistant Secretary Scott 
Cameron recently stated that ``This (market-style competition) is the 
way to capture the benefits of competition to produce better 
performance and better value. Competition makes for a much more 
exciting Lakers game than if only one team were on the court.'' Not 
only is this analogy inappropriate, but a clear indication that these 
appointees fail to understand the mission and the career motivation of 
most NPS employees.
    The Intermountain Region of the NPS has been wrestling with this 
issue for the past year, or so, but is approaching it in a much more 
constructive manner. Instead of focusing on how to implement 
competitive sourcing, leaders in the Intermountain Region are looking 
at ways to improve organizational effectiveness. With the assistance of 
Dr. Bruce Hutton (already referenced), they are developing a Mission 
Critical Position Application Plan. Their preliminary objectives for 
this process are to:

   Identify criteria to evaluate job related characteristics 
        needed to effectively and efficiently operate a park unit.
   Document gaps between job descriptions, work done, and unmet 
        needs.
   Re-bundle job characteristics into potential position 
        descriptions reflecting park needs, organizational 
        considerations, and relevance to mission, visitor, networks, 
        and knowledge and skill bases.
   Provide a workable model that can be applied across a 
        variety of parks.

    Moreover, they have developed a Strategic Plan to Achieve 
Organizational and Operational Effectiveness. Together, these two plans 
are designed to guide actions that will improve organizational 
effectiveness in the region and its parks, while sustaining the ability 
to carry out the public trust accorded them to meet its mission 
requirements.
    To us, these plans are much more appropriate ways to achieve 
effectiveness in the management of the workforce without compromising 
the value of the NPS employee and derogating the values of the mission 
of the NPS.

                                SUMMARY

    Right now in the NPS, because of the threat of competitive sourcing 
and other assaults on the integrity and mission of the NPS, morale is 
the lowest any of us have seen in up to 50 years. What is at risk is 
reducing a once proud, highly productive workforce in an agency with 
immense public respect and admiration, into a run-of-the-mill 
government bureaucracy. Is this what the citizens of America want? I 
think not.
    Ladies and Gentlemen of the Subcommittee, I urge you to put a stop 
to this initiative as it is being applied to the NPS and work with the 
agency to find more appropriate and less costly ways to improve its 
organizational effectiveness.
    The writer Wallace Stegner called our national parks ``the best 
idea America ever had.'' This Administration's policies could turn 
``the best idea America ever had'' into a grim reality of private 
corporations making money off of our national treasures. Unique natural 
and cultural resources and the visitor experience will be sacrificed in 
the process.
    On behalf of the Campaign to Protect America's Lands and the 
``Coalition of Concerned NPS Retirees'' I thank you very much for the 
opportunity to share our concerns and experiences. I will be pleased to 
answer any questions the Members might have.

    Senator Thomas. Thank you very much.
    Mr. McElveen.

  STATEMENT OF SCOT McELVEEN, ON BEHALF OF THE ASSOCIATION OF 
  NATIONAL PARK RANGERS AND THE ASSOCIATION OF NATIONAL PARK 
                     MAINTENANCE EMPLOYEES

    Mr. McElveen. Chairman Thomas, thank you for letting me and 
the association testify today. My name is Scot McElveen, and I 
serve the American people as the Chief Ranger of Harper's Ferry 
National Historical Park, but today I'm appearing here on my 
own time and in my own capacity as board member for special 
concerns for the Association of National Park Rangers. I am 
pleased to present this testimony on behalf of ANPR and for the 
Association of National Park Maintenance Employees.
    ANPR and ANPME are organizations that support the National 
Park Service and the National Park System. We represent a 
portion of the rank and file on the ground, operations-based 
employees of the National Park Service, and we believe our 
perceptions describe conditions as they actually exist in the 
parks. Our perceptions are not filtered through management, or 
they're not filtered through political layers, and we provide 
them in an attempt to help the National Park Service meet its 
obligation to the American people and Congress.
    Our greatest concerns with the concept of competitive 
sourcing are the consequences that its application may have on 
the congressionally mandated National Park Service mission, and 
to paraphrase the Bretton Woods Act of 1978, authorization of 
activities shall not be exercised in derogation of values and 
purposes for which these various areas have been established, 
except as may have been or shall be directly and specifically 
provided by Congress.
    Since the vitality and the perpetuation of the National 
Park System are dependent upon a properly staffed and skilled 
workforce, management programs that weaken the Service's 
ability to prevent impairment of our national parks result in 
derogation of the values and purposes for which these various 
areas have been established, without being directly and 
specifically provided by Congress.
    Over the previous decade, a consistent 97 percent of park 
visitors indicated that they are satisfied or very satisfied 
with their national park experience, and the NPS consistently 
ranks in the top five Federal agencies by Americans. We believe 
that a uniform presence in the parks is an important factor in 
that satisfaction.
    Whether it's the uniformed fee collector at the front gate, 
the interpretive ranger giving inspirational tours, the 
maintenance worker working on grounds and facilities, or the 
law enforcement ranger safeguarding park resources and park 
values, people trust and respect those wearing the National 
Park Service uniform. The public believes all NPS employees to 
be rangers, and they don't differentiate between our job 
titles.
    NPS employees routinely acquire far broader knowledge and 
skills than their position descriptions require. Strongly 
influencing this diversity of skills is the variable nature of 
work in parks. In a small workforce, multi-functional employees 
can more easily adapt to varying duties. A work day might 
include major emergencies, severe weather, injured or lost 
visitors, wildfires, or just answering the myriad questions of 
park visitors, who expect the ranger to know everything that 
they need to know while enjoying their parks.
    Here is one recent example of multi-functional NPS 
employees in action at Yellowstone National Park. It just 
happened this year. Over the busy Fourth of July weekend, one 
of many serious motor vehicle accidents occurred just west of 
Old Faithful. This accident involved a large van with four 
occupants rear-ending at a high rate of speed a small sedan 
with two occupants.
    The first ranger arrived on scene and sized up the 
situation and stated in her initial radio transmission, I need 
extra help, I have more patients than I do people. Immediately, 
a Park Service road crew, while at lunch, dropped their 
sandwiches and went directly to the scene to control traffic.
    Because of their training and experience with traffic 
control, with appropriate signs and reflective vests they very 
quickly set up a safe traffic control operation that allowed 
for slow movement of traffic through the scene while the five 
patients were attended to. The park geologist, a certified 
emergency medical technician, having heard the radio traffic, 
responded to the scene and was assigned patient care for one of 
the more seriously injured patients.
    Park superintendents have become experts in making the best 
use of every penny of operational funding, as well as the 
knowledge, skills, and available effort of every single park 
employee. We ask you, are contract maintenance workers going to 
deliver interpretive information to visitors, like the sign-
maker at Mount Rainier does as he hikes the trail performing 
his sign inventory? Are contract fee collectors and maintenance 
workers going to fight wildfires, search for the lost, and 
rescue the injured, as they routinely do at most parks in the 
system? Are contract fee collectors and administrative service 
workers going to prevent significant building loss by 
participating in the park structural fire brigade, as they did 
at Big Bend on July 14 of this year?
    If not, where is the value for the park or for the American 
taxpayer? How will these savings on contracts increase the 
service's ability to preserve the national and cultural 
resources of the park, while providing excellent service to 
visitors? We submit that a cost savings that seriously 
diminishes park staff capacity is hardly a better value for the 
taxpayer.
    The National Park Service is, by necessity, a very 
decentralized agency with a great deal of authority and 
responsibility vested in each park superintendent. It is his or 
her responsibility to continually assess how to obtain the 
greatest value for each operational dollar received. In the 
last several years, approximately 10 percent of the parks have 
developed business plans utilizing common methodology to define 
work and to define priorities. The results are useful 
blueprints for the most effective and efficient operation of 
the parks. This is a far superior approach to achieving the NPS 
mission while ensuring value to the taxpayer.
    We suggest a feasibility assessment process to avoid such a 
waste of time, effort and money as we see presently taking 
place, and Mr. Chairman, we have in our prepared statement a 
process that is described based on four questions that we think 
would meet that process.
    In conclusion, not everything can or should be measured in 
dollars. Can any of us presume to estimate the monetary value 
of the breathtaking views or historical importance of parks, or 
the recreational pleasure or spiritual renewal regularly 
experienced by visitors, or the iconic value of such places as 
Independence Hall, the Statute of Liberty, or Old Faithful? We 
don't think so.
    It's vitally important to understand that the preservation 
of these resources and experiences requires people with a 
strong sense of mission and ability to make decisions based 
upon value, not just cost, and a willingness to go beyond 
customary expectations to get the job done. These workforce 
qualities do not easily lend themselves to replication in a 
for-profit contract.
    We're not saying that there are no positions in the 
National Park Service----
    Senator Thomas. Could you wind up, please? We're going to 
have to go vote.
    Mr. McElveen [continuing]. There's no appropriate positions 
for outsourcing. We're just saying they're few and far between, 
and in a quota-driven program is not the way to get there.
    I would be happy to answer any questions.
    [The prepared statement of Mr. McElveen follows:]

 Prepared Statement of Scot McElveen, on Behalf of the Association of 
National Park Rangers and the Association of National Park Maintenance 
                               Employees

    Chairman Thomas and Members of the National Parks Subcommittee: I 
am Scot McElveen, Chief Ranger, Harpers Ferry National Historical Park, 
but am appearing today on my own time and in my capacity as Board 
Member for Special Concerns of the Association of National Park 
Rangers. I am pleased to present this testimony on behalf of ANPR and 
the Association of National Park Maintenance Employees.
    Thank you for holding this oversight hearing on the competitive 
sourcing effort within the National Park Service.
    The Association of National Park Rangers (ANPR) is an organization 
created to communicate for, about, and with park rangers; to promote 
and enhance the park ranger profession and its spirit; and to support 
the management and perpetuation of the National Park Service and 
System. In meeting these purposes, ANPR provides education and other 
training to develop and improve the knowledge and skills of park 
rangers and those interested in the profession; provides a forum for 
discussion of common concerns of park rangers; and provides information 
to the public. Our membership is comprised of individuals who are 
entrusted with and committed to the care, study, explanation, and 
protection of those natural, cultural, and recreational resources 
included in the National Park System, as well as of individuals who 
support these efforts.
    The Association of National Park Maintenance Employees (ANPME) is 
an organization of NPS employees and others that work or have an 
interest in maintenance, facility management and environmental 
leadership. Dedicated to supporting the mission of the National Park 
Service and the professional growth and well-being of maintenance 
employees, ANPME promotes the highest standards of national park 
stewardship and environmental leadership, and provides information to 
its members and to the public through publications, programs, training, 
and conferences.
    As organizations that strongly support the mission of the National 
Park Service, we have serious concerns about the short and long term 
effects of this management initiative.

                         MISSION IS THE MEASURE

    The American National Park System is a worldwide model. Much 
emulated, and still unrivaled, it is at once a diverse and amazing 
collection of beautiful natural resources and monuments, an enriching 
source of learning about American history and culture, as well as a 
source of recreation and enjoyment for more than 400 million visitors 
each year. Yet, this amazing system will not endure without proper 
care. Stewardship of the parks is the role of the National Park 
Service. Drawn from its enabling statute, the Organic Act of 1916, the 
mission of the Service is--

          ``. . . to promote and regulate the use of the . . . national 
        parks . . . which purpose is to conserve the scenery and the 
        natural and historic objects and the wild life therein and to 
        provide for the enjoyment of the same in such manner and by 
        such means as will leave them unimpaired for the enjoyment of 
        future generations.''

    Thus, we believe that all decisions and programs affecting the 
National Park Service should be carefully examined to ascertain whether 
they will further the NPS mission. Congress eloquently expressed this 
principle in the Redwoods Act of 1978 (P.L. 95-250) when it stated--

          ``. . . authorization of activities shall be construed and 
        the protection, management, administration . . . shall be 
        conducted in light of the high public value and integrity of 
        the National Park System and shall not be exercised in 
        derogation of the values and purposes for which these various 
        areas have been established, except as many have been or shall 
        be directly and specifically provided by Congress.''

    Since the vitality and perpetuation of the National Park System is 
very dependent upon a properly staffed and skilled Service, management 
programs that weaken the Service and our ability to prevent impairment 
of our national parks amount to ``derogation of the values and purposes 
for which these various areas have been established.''
    A component of the President's Management Initiative, the current 
competitive sourcing program, is driven by quotas and is being applied 
in an expensive, wasteful manner. No consideration is given to the NPS 
mission or to the nature of jobs and work in our national parks. 
Consequently, the greatest potential is not greater value for the 
American people, but irreparable harm to the National Park Service and, 
ultimately, the National Park System.

                     PUBLIC SERVICE AND THE UNIFORM

    Over the years, a consistent 97 percent of park visitors have 
indicated that they are ``satisfied'' or ``very satisfied'' with their 
national park experience. While the beauty, fun, and educational value 
of the natural and cultural resources are important factors, so is the 
service that they receive from park employees. Whether it is the 
uniformed fee collector at the front gate, the interpretive ranger 
giving tours, the maintenance worker tending the grounds and 
facilities, or the law enforcement commissioned ranger safeguarding 
visitor welfare and park resources, people trust and respect those 
wearing the National Park Service uniform. It represents a tradition of 
excellence in public service.
    We believe that a uniformed presence in the parks continues to be 
important. Because of reduced personnel levels, fee collectors and 
maintenance workers are often the only uniformed employees that 
visitors see. Yet these positions are considered the most promising for 
competitive sourcing. Should that happen, a significant number of 
visitors will never see a park ranger.
    Uniform positions that have been targeted for study include NPS 
archeologists and biological technicians. These professionals routinely 
enhance their effectiveness by working with 15 to 25 volunteers each--
an option not open to contractors. This value-added activity not only 
augments our resource management efforts but also provides another form 
of public service--by affording concerned Americans the opportunity to 
contribute their time, energy, and talents to the preservation of 
national treasures.

                      DIVERSITY OF WORK AND SKILLS

    Congress designated each unit of the National Park System because 
of its unique contribution to America's beauty and heritage. This 
uniqueness very often requires specialized knowledge, unique skill 
sets, and work flexibilities that simply are not found in the private 
sector. With specialized and continuing training and mentoring, NPS 
employees acquire far broader knowledge and skills than is reflected in 
their job descriptions. Strongly influencing this diversity of skills 
is the variable nature of work in the parks. At times as unpredictable 
as Mother Nature and human behavior, a workday may include major 
emergencies such as severe weather, injured and/or lost visitors, or 
wildfires. It likely involves ensuring that visitors are served as 
needed. This is illustrated by the following story from a young 
employee at a Western park.

          As a GS-5 visitor use assistant, I am clearly at the bottom 
        of park staffing. Today, I treated a man for a nearly 
        unstoppable razor cut to his face, spoke to 3 groups of 330 
        plus people each, dealt with 5 different school groups visiting 
        the park, and will in one half hour, deliver a 45 minute talk 
        and walk of the park to over 120 people. This morning we were 
        lucky, thanks to the ``donation'' of two law enforcement 
        rangers from other parks, so we had law enforcement support. 
        The only other uniformed ranger was one really good experienced 
        GS-9. And that's how we intend to deal with nearly 1000 
        visitors and their questions and even their small emergencies. 
        Want more? How clear do we need to be that more uniformed 
        presence is needed? Our maintenance man ended up playing 
        interpreter to two school groups out of lack of staff. We had 
        no volunteers, interns or other help for the first 3 hours of 
        the day and this is typical.

    A motor vehicle accident at Yellowstone National Park that occurred 
earlier this month illustrates the nature of employee teamwork.

          Over the busy 4th of July weekend, one of many serious motor 
        vehicle accidents occurred just west of Old Faithful. This 
        accident involved a large van, with 4 occupants, rear-ending 
        (at a high rate of speed), a small sedan, with two occupants. 
        The first Ranger arrived on the scene sized it up and stated in 
        her initial radio transmission something like, ``. . . need 
        extra help, I have more patients than I do people.'' 
        Immediately, a Park Service road crew, while at lunch, dropped 
        their sandwiches and went directly to the scene to control 
        traffic. Because of their training and experience with traffic 
        control, with appropriate signs and reflective vests, they very 
        quickly set up a safe traffic control operation that allowed 
        for slow movement of traffic through the scene while the 5 
        patients were attended to. The park geologist, a certified 
        Emergency Medical Technician, having heard the radio traffic, 
        responded to the scene and was assigned patient care for one of 
        the more seriously injured patients.

    Many park employees are cross-trained like the geologist as an EMT 
and the maintenance employees in traffic control. We regularly assist 
each other in a variety of ways. For example, as maintenance employees 
go about their work in the park, they serve as the ``eyes and ears'' of 
law enforcement by watching for troublesome or suspicious 
circumstances. Park employees work as teams to see that whatever needs 
doing is done. At our present, low staffing levels, this is the only 
way we are able get the job done.
    Additionally, employees develop park specific skills talents not 
required in other parks and certainly not easily found in private 
industry. The following story comes from Mt. Rainier in Washington 
State, as reported in The Olympian.

          Ralph Bell has worked at Mount Rainier National Park for 20 
        years, but his job as a sign maker might be replaced under a 
        proposal by the federal government to turn over 1,708 National 
        Park Service jobs to private companies by the end of 2004 . . . 
        Bell is responsible for more than 4,500 signs on buildings, 
        trails, roads and campgrounds. He also conducts safety training 
        and leads peer support sessions to help rescue workers deal 
        with traumatic events, and is a liaison for relatives of 
        accident victims.
          ``I take [privatization] as a threat to the stewardship of 
        the park,'' said Jim Fuller, 46, supervisor for utilities at 
        the park. He started at Mount Rainier in 1978 as a seasonal 
        employee . . . Fuller also works with search and rescue teams 
        and volunteers to help backcountry rangers. He hikes park 
        trails in uniform and talks to visitors.
          Like other park employees, Bell and Fuller have stayed at 
        Rainier because they recognize the park's value.
          Even workers who clean toilets and pick up garbage in 
        campgrounds contact visitors. They know the park and they 
        answer visitors' questions.
          ``We haven't figured out how to work that into a contract,'' 
        [Superintendent Dave] Uberuaga said.

                       COMPETITIVE SOURCING & NPS

    On any given day, 48,000 people report for work in national parks. 
Of this number, less than half (approximately 20,000) are federal 
employees--and some of these federal workers are from other agencies. 
Many of the non-federal workers are contract employees providing 
outsourced services (e.g. engineering and visual information services). 
Clearly, the National Park Service is no stranger to competitive 
sourcing. In fact, we do not oppose the availability and proper use of 
this authority--only its current application to the Service as required 
by the Office of Management and Budget and the Department of the 
Interior.
    To further describe why this initiative hurts rather than helps, we 
would like to make two important points.
    First, the National Park Service is, by necessity, very 
decentralized with a great deal of authority and responsibility vested 
in the park superintendent. It is his/her job to continually assess how 
to obtain the greatest value for each operational dollar received. In 
the last several years, approximately 10 percent of the parks have 
developed business plans which involve exhaustive analyses of 
strategic, programmatic, and business goals, resources, and issues. The 
results are useful blueprints for the most effective and efficient 
operation of the parks. This is a far superior approach to achieving 
the NPS mission while ensuring value to the American taxpayer.
    Secondly, the parks are hurting for financial and staff resources. 
Over the last 20 years, the NPS operations budget has eroded by 25 
percent (measured in constant dollars). Meanwhile, visitation has 
increased by approximately 50 percent and park acreage has increased by 
166 percent. The result has been ever tightening budgets and shrinking 
personnel levels. In an effort to deal with the demands of increased 
visitation and deteriorating facilities and vehicles, park 
superintendents have become experts at making maximum use of the 
knowledge, skills, and available effort of every single park employee. 
We ask you--

   Are contract maintenance workers going to deliver 
        interpretive programs to visitors like the sign maker at Mount 
        Rainier National Park does as he hikes trails performing his 
        sign inventory?
   Are contract fee collectors and maintenance workers going to 
        fight wildfires, search for the lost, and rescue the injured as 
        they routinely do at Canyonland National Park?
   Are contract fee collectors and administrative service 
        workers going to prevent significant building loss by 
        participating in the park's structural fire brigade as they did 
        at Big Bend on July 14?

    If not, where's the value for the park or for the American 
taxpayer? How will the ``savings'' on these contracts increase the 
Service's ability to preserve the natural and cultural resources of 
that park while providing excellent service to visitors? We submit that 
a cost savings that seriously diminishes park staff capacity is hardly 
a ``better value for the taxpayer.''

               AVOIDING WASTEFUL EFFORT AND EXPENDITURES

    At a time when parks are very underfunded and understaffed, a top-
down, quota-driven competitive sourcing initiative is just plain 
wasteful. It is estimated that the Service is paying nearly $3,000 to 
study each position to simply determine whether it is feasible. And 
that does not include an estimate of the value of the person/hours 
required to work the competitive sourcing process. Thus, Mount Rainier 
National Park, where 67 positions were scheduled for study, is faced 
with the prospect of taking approximately $200,000 away from current 
operations or maintenance, in order to study positions that, in all 
likelihood, cannot reasonably be privatized. We can ill-afford such a 
drain on our human and financial resources.
    The optimal solution would be to exempt the National Park Service 
from this management initiative and leave all such decisions to local 
NPS managers. However, if that is not possible, then we suggest a 
feasibility assessment process to avoid such a waste of time, effort, 
and money as we see presently taking place.
    An initial assessment before beginning the competitive sourcing 
process with regard to any group of positions in a park or region. Such 
an assessment would involve the examination of the following 
questions--

          1. Do the jobs proposed for competitive sourcing involve 
        consistent and predictable work within a fixed job description 
        (i.e., no additional responsibilities or emergency duties are 
        involved);
          2. Are the skills associated with the positions sufficiently 
        standardized as to be readily and easily found in private 
        industry?
          3. Would the sourcing of these positions enhance the overall 
        operation of the park?
          4. Are there potential bidders within a short distance of the 
        park so that response time is quick and predictable?

    We suggest to the Subcommittee that the initial review of the 
positions should reveal positive responses to all four questions for 
the competitive sourcing to proceed. If not, then we should not waste 
precious resources studying positions that are inappropriate for 
privatization.

                               CONCLUSION

    Not everything can--or should be--measured in dollars and cents. 
Can any of us presume to estimate the monetary value of the 
breathtaking views or historical importance of our parks? Or the 
recreational pleasure or spiritual renewal regularly experienced by 
visitors? Or the iconic value of such places as Independence Hall, the 
Statute of Liberty, and Old Faithful? We think not.
    It is vitally important to understand that the preservation of 
these resources and experiences requires people with a strong sense of 
mission, an ability to make decisions based upon value (not just cost), 
and a willingness to go beyond customary expectations to get the job 
done. These workforce qualities do not easily lend themselves to 
replication in a for-profit contractor. We are not saying that there 
are no positions in NPS that may be appropriate for outsourcing. What 
we are saying is that, at the park level, they are few and far between. 
And this top-down, quota-driven program is wasting precious operational 
dollars studying positions that cannot reasonably be outsourced. In the 
meantime, we are devastating the morale of the very employees that we 
are asking to do extra--and sometimes--extraordinary things.
    In the end, we are talking about an enormous stewardship 
responsibility that requires us as a nation to continually put our 
best--not our cheapest--foot forward. The goal for the National Park 
Service should be a sustainable, effective, and efficient organization 
that emphasizes quality service for the good of the parks and the 
public.
    On behalf of the Association of National Park Rangers and the 
Association of National Park Maintenance Employees, I thank you for the 
opportunity to present this testimony. I will be happy to answer any 
questions.

    Senator Thomas. Thank you very much. I guess that was my 
question. You're not suggesting that there's no place in the 
whole Park Service for some kind of competition, for being more 
efficient, for maybe having some outsourcing?
    Mr. McElveen. We're not, sir. I think that we believe that 
there are some basic questions that ought to be asked before 
you spend money studying positions. There are just some basic 
questions you ought to ask before wasting that $1.6 billion.
    Senator Thomas. You have to move forward. You know your 
business plans only came about because we required them.
    Mr. McElveen. I do know that, sir.
    Senator Thomas. So these parks are getting to be pretty big 
business. Do you have concessions in your park in Shenandoah?
    Mr. Wade. Yes, sir.
    Senator Thomas. Who runs those?
    Mr. Wade. They were privately contracted.
    Senator Thomas. How do they work?
    Mr. Wade. Pretty well.
    Senator Thomas. Interesting. There's no question. As you 
look at the Defense Department, which apparently was yours, do 
you see successes there? Do you see how that might work in the 
Park Service, or is there that much difference?
    Mr. Kleinman. I think there are a lot of lessons learned 
here. Clearly, the Defense Department has to specify its 
performance levels and criteria that it needs, and I think that 
is what everyone is being measured against.
    I think we find we require people to serve, we send people 
into theater, contractors, probably civil servants. I know I 
can look at Desert Storm, and we saw it with civilians that 
were sent into theater to support the military, and there were 
more contractors than there were civil servants, and they got 
there sooner.
    I look at the training, the aircraft contracts, and look at 
how we keep up the aircraft, and the private contractors were 
doing better than was being done previously, so I know they 
keep to those standards, and they require it, and the private 
contractors have to come through.
    Senator Thomas. Of course, the Park Service is different. 
The Service is there, obviously, at Yellowstone and Teton, but 
do you think, have you had an effort to reorganize and 
restructure your staff to look for efficiency and so on within 
your employees?
    Mr. Wade. Yes, sir. I think we did that quite regularly, 
and I think that is being done fairly frequently around the 
National Park Service. I'm aware, for instance, that the 
intermountain region right now in the National Park Service is 
going beyond just looking at competitive sourcing. They're 
looking at a mission-critical application plan and a strategy 
for organizational and operational improvement, and I think 
those are the kinds of things that make more sense to us than 
having this process driven by the sort of specter of 
competition and cost savings, again, given the difficulty of 
trying to put a cost on some of the things that are inherent in 
the National Park Service mission.
    Senator Thomas. Of course, cost savings is something you 
ought to be interested in, since you're $4 billion behind in 
maintenance and repairs, and the parks are getting larger, and 
there are more things going on. They are getting more 
businesslike, and they're going to have to be more businesslike 
in order to make it work. There is an end to the money. I 
certainly recognize the difference. Do you see, Mr. Segal, in 
your work do you see the uniqueness of the park keeping it from 
working like other agencies?
    Mr. Segal. Well, in looking at the experience of State 
governments, and actually our neighbors to the north in Canada 
and some of the provincial parks there, there has been a 
tremendous amount of contracting just in the parks alone, and 
many of these services that the National Park Service would be 
looking at, janitorial maintenance, ticket-takers, in fact 
States such as Oregon and Washington have actually contracted 
for fire-fighting services. In some cases when they needed 
extra support they went out and contracted for them. It wasn't 
a competitive process, however.
    Furthermore, the national parks have the ability to take a 
step back, look at their workforce, see what is mission-
critical, see where there are opportunities to outsource, or to 
competitively source. This is not a blanket, we're going to do 
everything. They have the ability to look at where they have 
needs, where they have gaps, and they should be using 
competitive sourcing to actually help fill those needs and 
gaps, rather than go willy nilly.
    Senator Thomas. Well, gentlemen, I agree with all of you. I 
think there is merit in this, in looking at it. On the other 
hand, I understand the uniqueness of the parks, and that 
probably we ought to be looking at additional ways to 
accomplish these things, so that's kind of where we are.
    I do believe--and I'm glad the park Director was here. I do 
think some of the information that came out originally was 
probably not as accurate as it should be in terms of what their 
real goals are. I'm sorry, I would like to ask more questions, 
but we're about down to the end of this vote.
    Senator Akaka. Mr. Chairman, I have questions, but I will 
submit them for the record.
    Senator Thomas. We appreciate very much your being here, 
and hope you will continue to give some thought to this as we 
move forward. Thanks so much. We appreciate it. The committee 
is adjourned.
    [Whereupon, at 4:40 p.m., the hearing was adjourned.]

                               APPENDIXES

                              ----------                              

                               Appendix I

                   Responses to Additional Questions

                              ----------                              

                      Association of National Park Rangers,
                                                    August 6, 2003.
Hon. Craig Thomas,
Chairman, Subcommittee on National Parks, Committee on Energy and 
        Natural Resources, U.S. Senate, Washington, DC.

    Dear Chairman Thomas: I would like to thank you for affording the 
Association of National Park Rangers the opportunity to testify on the 
important subject of competitive sourcing in the National Park Service. 
We also were pleased to receive additional questions to be answered for 
inclusion in the official hearing record. Following are the 
Subcommittee's questions and our answer to each.

    Question. If competitive sourcing is not appropriate for the 
National Park Service, how would you suggest they go about improving 
efficiency and lowering costs?
    Answer. ANPR is not opposed to competitive sourcing. However, we 
are opposed to its use in a top-down, quota-driven program, as in the 
President's Management Initiative. Like other management tools, 
competitive sourcing produces the most effective results when selected 
for use by local managers whose decisions will take into account 
overall park operations and long-term stewardship. Additionally, we 
believe that the Business Planning Initiative (BPI), made available to 
the parks by the National Parks Conservation Association, has the 
greatest potential for improving efficiency and effectiveness of the 
parks. The process of linking business considerations (i.e., costs, 
revenue, and opportunities) to a strong strategic focus (i.e., park 
goals), enables park management to more thoughtfully consider whether 
park functions can best be handled in-park or under a business 
contract. This is especially true as parks seek, through partnerships 
and other business innovations, to develop additional value for the 
public and enhanced revenues for park operations. Unfortunately, to 
date, only about 10 percent of the parks have had the opportunity to go 
through the rigorous and beneficial BPI process.
    Question. Everyone seems to agree that Park Rangers are inherently 
governmental and should not be subject to competitive sourcing. Which 
jobs within the National Park Service do you think would be best suited 
for competitive sourcing?
    Answer. There may be appropriate applications of competitive 
sourcing in the National Park Service, but this involves decisions that 
should be made by managers close to the positions in question. We 
believe it would be more beneficial to consider outsourcing in relation 
to work functions rather than to jobs or positions. This approach would 
enable the Service to efficiently and effectively handle specific 
functions (e.g., certain aspects of firefighting) without diminishing 
park capabilities in meeting the Congressionally mandated mission.
    We hope that you find these answers helpful. Please let us know if 
there is further information that we can provide to the Subcommittee.
            Sincerely,
                                                Ken Mabery,
                                                         President.
  Responses of Geoff Segal, Director of Privatization and Government 
 Reform Policy, The Reason Foundation, to Questions From Senator Thomas

    Question 1. How common is competitive sourcing by state 
governments?
    Answer. According to the Government Contracting Institute, the 
value of state government contracts to private firms is up 65 percent 
since 1996, reaching a total of $400 billion in 2001. This figure does 
include the federal government; however, the rate of increase is 
similar at all levels of government. A 1998 survey by the Council of 
State Governments found that 60 percent of state agencies had expanded 
their use of competitive sourcing in the past five years, and 55 
percent expected to expand their use of competitive sourcing further in 
the following five years. Looking specifically at state park systems, 
in the same CSG survey, park departments were more likely than other 
[executive] agencies to expand [competitive sourcing] in the past five 
years. Respondents also expect the trend to continue for the next five 
years--with almost three quarters of the respondents more frequently in 
the coming years, and most others will maintain current levels.
    Question 2. Under what circumstances is competitive sourcing not 
advisable?
    Answer. I believe that OMB has issued some guidelines, however, 
there are a couple of general rules of thumb. Positions that deal with 
policy making or are central to achieving the mission. With that said 
though, I think it is important that every position be reviewed over 
time--commercial activity or not. All positions should be subject to 
review for efficiency and effectiveness, so as not to allow agencies to 
stagnate.
    Question 3. Some organizations have been criticized for taking too 
long to conduct a competitive sourcing review. Based on your 
experience, how does the amount of time vary and is there a range of 
time that you would consider reasonable for competitive sourcing?
    Answer. The more complex the competition is, the longer it will 
take. Specialized services like engineering will have longer 
competitions then a competition for a ticket taker or vehicle 
maintenance position. However, some previous competitions have been 
stalled or hindered by the agency, so as to prevent the competition 
from taking place. OMB has issued numerous examples and believes that 
under the new A-76 guidelines full fledged competitions should take no 
longer then 12 months. I agree with this timeline, most states and 
local governments complete competitions in far less time--in some cases 
in only 3-6 months.
    Naturally, smaller competitions will take less time. OMB has 
suggested that 65 FTE's and under should be completed in 30 days. Its 
possible that longer studies of such small competitions will result in 
higher study costs and will offset any benefits or cost savings 
achieved.
    Question 4. We've heard reports that competitive sourcing reduces 
morale and raises anxiety among workers. Is this inevitable or can you 
explain how it might be minimized or avoided?
    Answer. The clear path to improving morale is information. Getting 
reliable and accurate information about the competitive sourcing plan 
is essential. To date there has been a lot of misinformation, if that 
continues, yes morale will continue to fall (if it has). I think 
anxiety is natural, there is a level of uncertainty and lack of 
control. By working with the employees, answering their questions and 
fears, these feelings can be minimized. Following the approach taken by 
the Department of the Interior will also minimize these concerns. Early 
on, Interior entered into an agreement with their union and have worked 
with them to address fears and concerns. They've also been very 
strategic about their implementation, shifting competitions between pay 
grades and locations so as to limit the burden to any one grade and 
location. This thinking and effort has allowed the Department to use 
competitive sourcing without a single RIF.
    Additionally, the first competition that is won by employees will 
raise morale. Once they see that they can compete, and that they are 
given a fair and balanced chance to win, many of the fears will be 
quelled. Again, I point to the Interior where employees have won nearly 
50 percent of competitions.
                                 ______
                                 
  Responses of Bill Wade, Former Superintendent, Shenandoah National 
                 Park, to Questions From Senator Thomas

    Question 1. As a former park superintendent, which positions 
currently performed by government employees within the National Park 
Service would be good candidates for performance by a private 
contractor?
    Answer. The NPS ought to be allowed to determine which positions 
are ``mission critical'' rather than using the arbitrary ``inherently 
governmental'' approach. Mission critical positions would be those that 
are heavily multi-disciplinary, are crucial to the institutional 
capability of a manager to determine and act on ``situation awareness'' 
or are organizationally sensitive in nature (e.g., law enforcement, 
financial management, certain human resource management, etc.). Such 
mission critical positions would vary depending on the park or office, 
and would not be determined by occupational series across the board. 
Positions determined not to be ``mission critical'' would be candidates 
for competitive sourcing.
    Question 2. In your experience as a manager in the National Park 
Service, did you ever take action to reorganize your workforce to 
improve efficiency and quality? If so, how is competitive sourcing any 
different and were you able to keep the cost savings?
    Answer. Several times during my career I initiated workforce 
reorganizations. These were usually necessitated by the shrinking 
capability of the budget, or by FTE ceilings. These often resulted in 
greater effectiveness and quality improvement. Budget limitations often 
were driving the action, so ``cost savings'' per se were not a result 
but a driver.
    Question 3. Did you have contract or private sector employees 
working in your park? How would you rate their overall quality and 
performance?
    Answer. Often specific projects were contracted out, but at 
Shenandoah, we did not contract out entire functions while I was there. 
However, we did rely heavily on volunteers to carry out some functions 
(e.g., trail maintenance in backcountry) that we could not adequately 
accomplish with paid staff.
    Question 4. Specifically, how do you feel that a contractor would 
diminish the level of service currently provided by NPS employees?
    Answer. My biggest concern would be the reduction in the 
institutional capability of a park manager to acquire good information, 
interpret that information, and predict the future of processes and 
actions if certain ``mission critical'' positions (such as scientists, 
resource managers, education specialists) are contracted out. Moreover, 
I am concerned about the loss of expertise and overall pride and 
commitment of the workforce--especially as perceived by the public--if 
public contact positions are contracted out.
    Question 5. Have you had occasion to speak to any NPS employees and 
determine their level of understanding of the competitive sourcing 
process and gauge whether there is a loss in morale?
    Answer. Having recently accomplished a project for the 
Intermountain Region of the NPS to develop a ``Strategic Plan for 
Improving Operational and Organizational Effectiveness'' I had occasion 
to obtain substantial input from employees in the region, both in 
workshops and via e-mail. I believe the level of understanding of the 
competitive sourcing process is fair to good among those employees. 
Their greatest concern is not for the potential loss of their own jobs; 
rather it is a fear that contracting out will change the NPS's ability 
to meet it's mission mandate and ultimately reduce the public's image 
of the agency. They are concerned that the process ultimately will 
reduce the flexibility within parks to meet unusual, unpredictable and 
emergency situations, which are typical and ongoing in parks. It should 
be noted that EVEN IF the NPS ``wins'' the contract in a competitive 
sourcing action (as Director Mainella predicts often will be the case), 
the work unit then must operate in accordance with the conditions 
established for the RFP, thus making the operation much less flexible. 
The problem here, of course, is being able to adequately capture the 
multidisciplinary nature of many jobs and the lack of a stable, 
predictable work situation into a contracting document.
    I believe there is a significant loss in morale in the NPS right 
now (some say it is the lowest observed in up to 50 years), and the 
pressure of the competitive sourcing initiative (and the attendant 
costs and loss of corresponding operational capability) is one of 
several factors causing this.
                                 ______
                                 
    [Responses to the following questions were not received at 
the time this hearing went to press.]

     Questions for Fran Mainella, Director, National Park Service, 
            Department of the Interior, From Senator Thomas
    Question 1. As I mentioned in my opening statement, for years the 
Park Service has been urged to eliminate the number of commercial 
functions. For instance, in 1997 Congress instructed the Park Service 
to:
    ``Continue to increase its contracting of commercial activities, 
with the goal of divesting itself of such activities by the end of 
fiscal year 1999. When services or products of equal quality and cost 
are available from the private sector, the Service should use the 
private sector. The budget savings achieved should be used to reduce 
the maintenance backlog.'' (See attached document)
    While you were not the Director of the Parks Service at the time, 
could you tell the committee what the Parks Service did to follow 
through with this provision? (Clinton Administration failed to act on 
Congressional requirement).
    Did the Park Service provide a report to the House and Senate on 
its efforts to divest itself from commercial functions?
    Question 2. Between 1982 and 1990, GSA studied 459 of its in-house 
work activities, many with A-76, and saved an average of 40 percent. 
Since 1978, DOD has studied 2,300 activities and saved 33 percent. With 
permanent, year-after-year payoffs like these, it seems to me that the 
cost of doing the studies is trivial compared to the potential benefit 
to the parks, your budget, and the visitors. How would you explain the 
resistance and reluctance in NPS to move forward on this effort?
    Question 3. Critics of competitive sourcing have said that use of 
contract personnel will lower the quality of the visitor experience. 
How will you sustain a high quality visitor experience during and after 
the competitive sourcing process?
    Question 4. You have asserted that competitive sourcing would have 
a negative effect on the diversity of the NPS workforce. The NPS is 
considered to be considerably under-represented in the diversity of its 
employees, what steps are you taking to improve the diversity of the 
workforce as competitive sourcing progresses?
    Question 5. While I understand the revisions to the A-76 process 
eliminated the practice known as direct conversion, could you explain 
to the Committee why the Parks Service used direct conversions for a 
number of positions?
    Also, when direct conversion was used by the Parks Service, was 
there any economic analysis done?
    Question 6. Critics of the competitive sourcing effort have 
reported that volunteer participation will decline if contractors are 
hired to perform trail maintenance and similar activities. How does the 
Administration plan to address the potential impact of competitive 
sourcing on volunteer programs?
    Question 7. Which programs or projects have you extended, 
postponed, or canceled in order to fund the competitive sourcing 
effort? How are you funding the competitive sourcing effort?
    Question 8. A Washington Post article on July 15 of this year 
reported that the Park Service is reviewing archaeology positions at 
the Midwest and Southeast Archaeological Centers for competition. Is 
this true and if so, when do you expect to make a decision regarding 
the future of the archaeology positions?
    Question 9. Why pick archaeologists as one of your first studies, 
as opposed to the types of operations more commonly contracted for by 
most local governments, such as road maintenance and repair, snow 
plowing, vehicle maintenance, janitorial, etc?
    Question 10. If, through competition, a contractor assumes the 
archaeological functions, how do you intend to maintain the quality, 
and more importantly, the quantity of effort currently expended through 
volunteers?
    Question 11. In addition to competitive sourcing, I also understand 
that the Department of the Interior is putting together a workforce 
plan. Is the workforce plan being incorporated into the Park Service's 
competitive sourcing plan?
    Question 12. You have stated that the NPS competitive sourcing 
effort will be focused on positions with projected retirements, high 
attrition, positions that are difficult to recruit and retain, and 
positions with a history of poor performance. How do you intend to do 
this?
    Question 13. Federal jobs pay well if you include benefits in the 
total pay calculation. Are you lowering the economic standard of rural 
communities if you contract out positions?
    Question 14. How will you ensure that workers continue to receive 
medical benefits for positions filled by contract employees?
    Question 15. Through this process do you foresee the need to 
request Reduction-in-Force or Early Out authority?
    Question 16. When you served as Director of Parks programs in the 
State of Florida, what type of competitive sourcing did you undertake 
in that organization?
    Question 17. The Administration has consistently opposed new park 
designations in order to place emphasis on correcting the maintenance 
backlog. Why spend funds on competitive sourcing if maintenance backlog 
is a priority?
                                 ______
                                 
  Questions for Angela Styles, Administrator for Federal Procurement 
      Policy, Office of Management and Budget, From Senator Thomas
    Question 1. What changes has the Administration made in the 
competitive sourcing effort based on feedback from employees and the 
public?
    Question 2. Has the NPS submitted or developed a communication plan 
for its employees?
    Question 3. Has the National Park Service provided adequate 
information to its employees servicewide?
    Question 4. Civilian agencies, including the National Park Service, 
have little experience with competitive sourcing. What has OMB done to 
modify the A-76 process to make it more compatible with civilian 
agencies?
    Question 5. What is the Administration's position on efforts in the 
House of Representatives to shield Archeologists from competitive 
sourcing?
    Question 6. What has OMB been doing to tailor the percentage of 
``commercial'' positions being examined to something more appropriate 
for an agency like the National Park Service that has a mission 
involving close contact with the public?
    Question 7. Following an A-76 competition in which a private sector 
company wins, can you explain to the Committee what happens to the 
savings that are had? Do they go back to the Treasury?
                                 ______
                                 
   Questions for Sam Kleinman, Vice President for Resource Analysis, 
       Center for Naval Analysis Corporation, From Senator Thomas
    Question 1. How much has the Department of Defense spent for its 
competitive sourcing effort, how many years has the study been ongoing, 
and how many positions have they reviewed?
    Question 2. We all learn from experience and use the lessons 
learned to avoid mistakes in the future. What are the most important 
lessons learned from conducting competitive sourcing in the Department 
of Defense?
    Question 3. What advice can you offer the National Park Service to 
help them minimize the adverse impact of competitive sourcing?
    Question 4. What is the success rate of government versus contract 
in winning contracts?
    Question 5. Overall, have the contractors provided the same or 
better level of service than public employees?

                              Appendix II

              Additional Material Submitted for the Record

                              ----------                              

          Statement of Colleen M. Kelley, National President, 
                   National Treasury Employees Union

    Chairman Thomas, Ranking Member Akaka, and other distinguished 
members of this subcommittee, thank you for giving me an opportunity to 
submit testimony in opposition to the Administration's plans to 
privatize National Park Service (NPS) jobs. The National Treasury 
Employees Union (NTEU) represents 150,000 federal employees in 29 
federal agencies and departments, including many of the men and women 
who work at the National Park Service.
    NTEU strongly opposes OMB's quota-driven campaign to privatize 
National Park Service jobs and hundreds of thousands of other federal 
employee jobs throughout the government. We believe this privatization 
initiative is unfair to federal employees, and will ultimately result 
in government services being delivered by unaccountable private 
contractors at higher costs and lower value to the taxpayers.
    The Park Service is reviewing more than 1,700 federal jobs for 
privatization to meet OMB's ``competitive sourcing'' quotas. An April 
memorandum from NPS Director Fran Mainella raised serious concerns 
about the high costs and effects on park operations of complying with 
the OMB privatization mandate. The memorandum pointed out that since 
the OMB mandate is unfunded, NPS will have to cut its park maintenance 
budget. The memo also stated that, ``covering these costs would have 
serious consequences for visitor services and seasonal operations,'' as 
``agency staff must be taken off other priority projects to accomplish 
the competitive sourcing studies.'' In addition, the memorandum cites 
the negative impact the privatization studies will have on the 
diversity of its workforce.
    With strong bipartisan support, the House of Representatives 
recently approved the House Interior Appropriations Act for FY 2004, 
which included an amendment that would put the brakes on efforts at the 
Park Service to privatize the jobs of hundreds of professional Park 
Service employees. With this vote, the House of Representatives sent a 
clear signal to the Administration that the reckless campaign to 
privatize the federal government has gone too far, too fast.
    The breadth of the Administration's rush to privatize goes well 
beyond the Park Service. In addition to the Park Service, every 
agency--from those charged with enforcing our tax and trade laws to 
those ensuring our homeland security--is being forced to comply with 
the OMB mandate. The Park Service and other federal agencies are 
already struggling under tight budget constraints in order to carry out 
their missions. And now with this unfunded OMB mandate, all agencies 
are being forced to dip into their operating budgets to hire outside 
consultants to conduct the ``competitive sourcing'' studies. In 
addition, federal employees at the Park Service and elsewhere have been 
shifted away from their core activities in order to prepare performance 
work statements, develop in-house organizations, and conduct cost 
comparison studies. And as more and more government functions are 
privatized, the funding and staffing necessary to oversee contractors 
and ensure their compliance with contracts will skyrocket.
    I urge this subcommittee to work to stop the reckless privatization 
underway at the National Park Service and other federal agencies. 
Safeguarding our national parks and natural treasures has always been 
the responsibility of federal employees and it always should be. When 
Americans visit our national parks, they rightly expect to be greeted 
by rangers employed by the federal government, not by guards rented 
from major campaign contributors. Now is not the time for the federal 
government to turn its back on our nation's vast array of natural 
riches.
    Thank you for giving me the opportunity to testify today.
                                 ______
                                 
        Statement by Bobby L. Harnage, Sr., National President, 
          American Federation of Government Employees, AFL-CIO

                              INTRODUCTION

    Thank you, Chairman Thomas, for this opportunity to submit written 
testimony for today's hearing on the impact of the Bush 
Administration's wholesale privatization policy on the National Park 
Service (NPS). AFGE urges Senators to support efforts to at least 
temporarily suspend the massive effort underway at the Department of 
the Interior and related agencies to privatize the services performed 
by the reliable and experienced federal employees--including 
scientists, archeologists, architects, curators, engineers, fire 
fighters, and laborers--who have dedicated their lives to safeguarding 
America's natural treasures.
    The House Interior Appropriations Bill already includes a 
bipartisan provision (Section 335) that would suspend this wholesale 
privatization effort so that the Congress can develop a better 
understanding of its costs and consequences. AFGE urges lawmakers to 
include a similar provision when the Interior Appropriations Bill is 
considered on the Senate floor.
    Currently, Interior and related agencies are under extraordinary 
pressure to privatize critical programs because of an onerous quota 
imposed upon all agencies by the Office of Management and Budget (OMB) 
to review for privatization 15% of their ``commercial'' activities by 
the end of FY 2003. This quota is being applied regardless of the 
impact on the mission of Interior and related agencies or the needs of 
all Americans who depend on those agencies for efficient and reliable 
service. In fact, OMB has refused to supply any research or analysis to 
justify the privatization quota, despite a report requirement in the FY 
2003 Omnibus Appropriations Bill. However, the sanctions that OMB 
imposes on agencies that fail to fulfill the privatization quota are 
severe, ranging from arbitrary reductions in staff to punitive budget 
cuts.
    That's why it is so imperative that the Congress protect Interior 
and related agencies from this controversial privatization effort by 
preventing the OMB quota from being enforced with respect to the 
essential work performed by those agencies. Like the Republican and 
Democratic lawmakers on the House Appropriations Committee, as 
expressed in the report for the Interior Appropriations Bill, AFGE is

          ``concerned about the massive scale, seemingly arbitrary 
        targets, and considerable costs associated with this 
        initiative, costs which are expected to be absorbed by the 
        agencies at a time when federal budgets are declining . . . 
        This massive initiative appears to be on such a fast track that 
        the Congress and the public are neither able to participate nor 
        understand the costs and implications of the decisions being 
        made.''

    According to political appointees in Interior and related agencies, 
the OMB privatization quota has diverted staff from high-priority 
assignments, consumed funding that the Congress had directed towards 
fulfilling important mission-essential requirements, and has turned 
back the clock on efforts to ensure the in-house workforce is as 
diverse and inclusive as the American people.

     WHY THE OMB OUTSOURCING QUOTA SHOULD BE SHUT DOWN IN INTERIOR

    1. Currently, Interior and related agencies are under extraordinary 
pressure to privatize critical programs because of an onerous quota 
imposed upon all agencies by OMB to review for privatization 15% of 
their ``commercial'' activities by the end of FY 2003. This quota is 
being applied regardless of the impact on the mission of Interior and 
related agencies or the needs of all Americans who depend on those 
agencies for efficient and reliable service. In fact, OMB has refused 
to supply any research or analysis to justify the privatization quota, 
despite a report requirement in the FY 2003 Omnibus Appropriations 
Bill.
    House report language: ``. . . (T)he Committee remains concerned 
about the massive scale, seemingly arbitrary targets, and considerable 
costs associated with this initiative, costs which are expected to be 
absorbed by the agencies at a time when federal budgets are 
declining.''
    Senate report language: ``The Committee also notes the seeming 
absence of consideration of previous competitive sourcing experiences, 
which often have occurred with the Committee's encouragement and active 
involvement. The National Park Service's Denver Service Center and the 
mapping activities of the U.S. Geological Survey are two such examples. 
While the Committee does not contend that agencies should be satisfied 
to rest on past achievements, it does expect that past successes and 
failures be evaluated in some detail prior to the launching of any 
major new initiatives. If such an evaluation has taken place, the 
results have not been presented to the Committee.''

    2. The OMB privatization quota is having an adverse impact on the 
ability of Interior and related agencies to perform their missions.
    House report language: ``The Committee understands that the Forest 
Service expects to spend $10 million during fiscal year 2003 on 
competitive sourcing activities. The Committee is concerned that all 
forests and most contracting officers will be heavily impacted by this 
effort at a time when they should concentrate their attention on 
improving business practices that were adversely affected by last 
year's severe fiscal situation due to the redirection of funds for 
emergency fire-fighting.''
    National Parks Service Director Fran Mainella: ``In addition to 
contract costs agency staff must be taken off other priority projects 
to accomplish the competitive sourcing studies.''
    The Washington Post (April 19): ``(Director) Mainella noted that 
covering such costs without new funding would have `serious 
consequences for visitor services and seasonal operations.' The most 
likely result, agency spokesman David Barna said, is that the park 
service would cut back on the 6,000 to 8,000 seasonal employees, 
including park rangers and trail guides, that it typically hires to 
handle the crush of visitors during the summer.''
    National Parks Service Director Mainella: ``Another major area of 
concern is the cost of the studies. Our negotiations and information on 
consultant costs to date reflect the cost of approximately $3,000 per 
FTE in a full cost comparison study . . . Further, the cost of 
monitoring work that is ultimately contracted out is an unknown to us . 
. . (W)e do not have a fund source to cover the cost of completing 
these studies. The costs are too significant to be covered by the 
affected parks as some in the Department have suggested.''
    GovExec (June 16): ``The Park Service has already cut back some 
facility repairs in order to finance competitive sourcing studies and 
law enforcement costs related to the war on terrorism. In a May 7 
memorandum to park superintendents in the Pacific West Region, which 
encompasses five western states, Park Service officials announced that 
$4.6 million in building repairs would be cut. ``Our region recently 
received a $4,617,000 assessment [from the regional repair program] to 
fund law enforcement costs for anti-terrorism activities and for 
competitive sourcing studies,'' said Cynthia Ip, chief budget officer 
in the Pacific West Region, in a recent memo. ``The assessment is a 
substantial cut of 28 percent from the congressional approved amount 
for the [program],'' she added. Repair projects put on hold include the 
seismic retrofit of 18 historic buildings in the Golden Gate National 
Recreation Area, according to an attachment to Ip's memo.
    The Washington Post (June 10): ``To understand how budget cuts and 
job anxiety are playing out on the ground, consider Mount Rainier 
National Park, where 1.3 million people a year visit a 14,410-foot 
volcano southeast of Seattle. Administrators of the park have been 
instructed this spring to absorb a 40 percent cut in their repair 
budget. The order halted plans to fix a rotting footbridge and a 
dilapidated backcountry ranger cabin. The bridge and cabin are part of 
a $90 million maintenance backlog in the park. Dave Uberuaga, 
superintendent at Mount Rainier, said the $273,000 that would have been 
spent this year to fix the bridge and cabin will instead pay for an 18-
month privatization study by consultants. They will examine whether the 
government could save money by replacing 60 percent of the 112 federal 
employees in the park with contract workers.''

    3. Interior and related agencies are spending large sums of funds 
appropriated for mission-essential work to pay off high-priced 
privatization consultants.
    House report language: ``This massive initiative appears to be on 
such a fast track that Congress and the public are neither able to 
participate nor understand the costs and implications of the decisions 
being made. In addition, the Committee's required reprogramming 
guidelines are not being followed. While millions have been spent, 
reprogramming letters have not been forwarded to the Committee.''
    Senate report language: ``The Committee is deeply concerned, 
however, at the administration's failure to either budget adequately 
for the cost of the initiative or describe such costs in budget 
documents. As a result, significant sums are being expended in 
violation of the Committee's reprogramming guidelines and at the 
expense of critical on-the-ground work such as maintenance of Federal 
facilities. The Forest Service alone plans to spend $10,000,000 on 
competitive sourcing in fiscal year 2003, including $8,000,000 to 
establish a competitive sourcing office. Such activities were described 
nowhere in the Forest Service's fiscal year 2003 budget justification, 
and were not provided for in the fiscal year conference report or 
accompanying statement of the managers. The Department of the Interior 
is also spending significant amounts on the competitive sourcing 
initiative.''
    GovExec.com (June 24): ``The Forest Service had planned to spend 
$10 million on job competitions in fiscal 2003, a figure that includes 
contractor support and the cost of running a competitive sourcing 
office in Washington, according to Thomas Mills, deputy director for 
business operations at the agency. On Tuesday, Mills said the Forest 
Service will conduct another estimate of the cost of its competitive 
sourcing in response to congressional concerns. `It looks like there's 
enough interest that we're going to do a new estimate,' he said. `I'm 
fairly confident it will be more than $10 million,' he added.''

    4. Because Interior and related agencies lack sufficient capacity 
to conduct privatization reviews and administer an ever-growing number 
of service contracts, the Congress has little insight into how 
efficiently taxpayer dollars are being used.
    House report language: ``Each agency should provide in-depth report 
to the Committee detailing the results of completed studies and the 
action to be taken as a result of those studies. The reports should be 
completed by March 1, 2004, and should include specific schedules, 
plans, and cost analyses for the outsourcing competitions.''

    5. The OMB privatization quota is having a devastating impact on 
the ability of agencies to employ a workforce that is as diverse and 
inclusive as the American people.
    National Parks Service Director Mainella: ``First is the diversity 
issue. In recent years we have sought to increase the diversity of the 
agency workforce. These studies have the potential to impact this 
effort, for example, 89% of the FTE proposed for study in the 
Washington, D.C., area may affect the diversity of our workforce. 
Studies in San Francisco and Santa Fe show large concentrations of 
diverse FTE as well. This potential impact upon this workforce concerns 
us.''

    6. OMB has recently made the privatization process even more unfair 
to federal employees, especially in the context of the privatization 
quota.

          a. The new A-76 emphasizes a streamlined competition process 
        that does not ensure that federal employees are able to submit 
        their best bids and that contractors at least promise 
        appreciable savings before work is contracted out; this process 
        has even been repudiated by the pro-contractor Commercial 
        Activities Panel.
          b. The new A-76 also introduces a subjective best value 
        competition process that allows contractors to submit more 
        expensive and less responsive bids than federal employees and 
        still win contracts. The Senate Armed Services Committee has 
        prevented the best value process from even being used by the 
        Department of Defense on any services other than information 
        technology.
          c. The new privatization process also absolutely requires 
        federal employees to compete in order to acquire and retain 
        work, but not contractors.
          d. Federal employees are held strictly accountable in the 
        event of failure, but not contractors.
          e. The OMB privatization quota is entirely one-way: only work 
        performed by federal employees is reviewed, even though OMB 
        officials insist that they have ``removed all obstacles'' that 
        would prevent federal employees from competing for new work and 
        work performed by contractors.
          f. Federal employees, unlike their contractor counterparts, 
        are still deprived of the legal standing to take contracting 
        out concerns to the General Accounting Office (GAO) or the 
        Court of Federal Claims.
          g. Agencies receive no credit for using alternatives 
        (reorganization, consolidation, labor-management partnerships) 
        to privatization to make their agencies more efficient, even 
        those that don't have the significant costs associated with 
        privatization (conducting a competition, transitioning the 
        work, and administering a contract).

                                 ______
                                 
  Statement of Craig D. Obey, Vice President for Government Affairs, 
                National Parks Conservation Association

    Mr. Chairman and members of the subcommittee, the National Parks 
Conservation Association (NPCA) appreciates the opportunity to submit 
testimony on a subject of major concern to us--the administration's 
plan to outsource a significant number of positions at the National 
Park Service. NPCA is the only national, nonpartisan advocacy 
organization exclusively devoted to protecting the national parks. 
Today, we have more than 300,000 members nationwide.
    The National Park Service is one of the most beloved institutions 
of American government. It is comprised of some of the most dedicated 
and underpaid public servants in our nation and is the guardian of our 
most precious natural and cultural treasures. Not only do the people of 
the Park Service protect the legacy of great Americans ranging from 
presidents John and John Quincy Adams and the Reverend Martin Luther 
King, Jr. to the Wright brothers, but they also bring to life historic 
battles at Manassas, Gettysburg, and Glorieta Pass, and preserve 
remarkable gifts of nature at Mount Rainier, Great Smoky Mountains, and 
Theodore Roosevelt national parks. Together, these places preserve a 
collective American heritage that must be treated with the highest 
care.
    Yet, the administration's Office of Management and Budget (OMB) and 
Department of the Interior are moving aggressively with a policy that 
could hand over to low-bidding private contractors a majority of jobs 
in the already understaffed, financially strapped National Park 
Service, including archaeologists, anthropologists, biologists, museum 
curators, masons and other maintenance workers. As currently designed, 
this rapid, massive effort to competitively outsource many Park Service 
positions threatens to adversely impact our national parks and the 
experiences of millions of park visitors, and would further limit the 
ethnic diversity of the Park Service workforce.
    NPCA strongly supports the pause in outsourcing activity approved 
last week by the House of Representatives. We believe a pause is more 
than reasonable, given the administration's aggressive, reckless 
pursuit of outsourcing and competition as an end in itself, without 
providing due consideration to the mission and needs of our national 
parks. The Park Service already outsources an enormous amount of 
activity, but we must look before we leap. It is essential that we 
avoid reaching a tipping point at which too much responsibility for 
protecting our national treasures is placed in the hands of commercial 
interests, and too little left in the hands of the mission-driven Park 
Service. The protection of our national parks must be acknowledged as 
an inherent responsibility of government and Park Service employees 
recognized as key to the preservation of our national heritage for 
present and future generations.

                               BACKGROUND

    Originally established in 1955, and codified by the Federal 
Activities Inventory Reform (FAIR) Act of 1998, the privatization 
policy described in OMB Circular A-76 was created to ensure that 
activities performed by the government are as cost-effective and 
efficient as possible. The policy outlines the procedure for deciding 
whether commercial activity done by a federal government employee will 
be contracted out, kept in-house, or performed by a separate government 
agency.
    The term ``inherently governmental function'' defines a function 
that is so intimately related to the public interest as to require 
performance by government employees, and therefore not be subject to A-
76. OMB's controversial rewrite of the A-76 Circular, which was made 
public in December 2002 and finalized in May, includes changes that 
threaten our national parks. The most problematic aspects of the 
revised Circular are that it:

   Redefines the term ``inherently governmental function'' by 
        deleting the provision that includes jobs involving the 
        ``regulation of the use of space, oceans, navigable rivers, and 
        other natural resources'';
   Presumes all federal activities are commercial, and subject 
        to contracting, unless an agency can prove otherwise;
   Designates a political appointee to approve or reject a 
        career professional's justification that a particular job is 
        inherently governmental, the key test for whether a job is 
        considered commercial; and
   Requires that all competitions be completed within one year.

    We do not oppose the FAIR Act, nor do we oppose outsourcing in 
appropriate circumstances. However, we are extremely concerned by the 
degree to which the Bush administration has broadened the reach of the 
contracting out of Park Service jobs by removing the presumption that 
protecting natural resources is an inherently governmental function. 
Further, we are concerned that the administration has, to this point, 
demonstrated no willingness to slow this process to the degree 
necessary to ensure that enormous mistakes are not made.

                       PRIVATIZATION IN THE PARKS

    The National Park Service already provides significant and 
appropriate opportunities for private sector partnerships. The 
concessions program, which generates annual revenues of $800 million, 
has long been a private undertaking. More recently, architectural, 
design, and printing work throughout the National Park System has been 
and continues to be contracted out. In individual parks, both large and 
small, superintendents already make decisions as to what jobs can, and 
should, be outsourced. Thus, without intervention from political 
appointees in Washington. D.C., the Park Service has already outsourced 
positions, when appropriate, while retaining the positions and 
functions that are key contributors to its core mission to protect the 
national parks and connect the American public to its shared history 
and culture.
    Importantly, the Park Service has yet to assess the impact of the 
significant activity it has already outsourced. The fact that so much 
activity at the Park Service is already in commercial hands provides an 
enormous opportunity and reason to study what has already occurred, 
before moving aggressively to further shift the balance. Ultimately, 
the question asked should not be how many positions conceivably could 
be placed in commercial hands, but the aggregate impact of such 
privatization on the mission of the National Park Service.

                         COSTS AND CONSEQUENCES

    NPCA is enormously concerned by the speed, breadth, and cost of the 
administration's outsourcing effort. The Park Service's own estimates 
indicate it costs $3,000 per FTE to conduct outsourcing studies. The 
Park Service's commercial activities inventory identified about 11,500 
``commercial'' FTE that are potentially subject to outsourcing. Using 
the Park Service's $3,000 estimate, studying the positions identified 
in the inventory could cost the taxpayers more than $34,000,000. This 
total amount far outstrips the Park Service's own estimate earlier this 
year that bringing in consultants to help run the private-public 
competitions may cost between $2.5 million and $3 million in the near 
future. But either way, this is money that the Park Service does not 
have, as national parks are already operating, on average, with only 
two-thirds of the needed funding a shortfall this subcommittee has been 
quite helpful in pointing out. We think it particularly unwise to spend 
such funds when the Park Service's base operating budget is actually 
decreasing in real terms by 3 percent since FY 2001, according to the 
House Appropriations Committee--and the Park Service continues to have 
an enormous backlog of unmet needs.
    The situation at Mount Rainier National Park in western Washington 
illustrates this point. After a century of intense visitation, the 
park's roads, bridges, and facilities need dire repairs. Under 
outsourcing and anti-terrorism requirements, the park may have to 
divert up to 40 percent of its repair budget, putting important 
projects on hold. We understand that the outsourcing study of 67 
maintenance, rescue, and other staff positions at Mount Rainier Park 
may be postponed past fiscal year 2004. If such a postponement occurs, 
we wonder if other parks could receive similar reconsideration. After 
all, many other national parks are, or soon will be, in similar 
situations.
    For example, roughly 150 positions at Great Smoky Mountain National 
Park are scheduled for study in fiscal year 2004. The administration's 
plan as of this February was to study 37 Park Service positions in New 
Mexico, almost all of which are in cultural resource management or 
archeology. In total, the Intermountain region of the National Park 
Service consists of roughly 5,000 positions. The fiscal year 2003 
Commercial Activities Inventory shows that approximately 2,600 FTE 
could be studied--positions that include maintenance, administration, 
and natural and cultural resources. OMB is requiring that before fiscal 
year 2005, 50 percent of the positions on the Commercial Activities 
inventory be studied. That means studying 25 percent of all positions 
in the region. Other regions appear to face similar burdens.
    The administration is generally quick to argue that it will only 
study a cumulative number of 1708 by the end of fiscal year 2004. But 
this figure ignores the nearly 1,000 direct conversions that have 
already occurred; some that likely were inherently governmental in 
nature even under OMB's new definitions, and therefore may have been 
illegally converted. It also misses the larger point--the cumulative 
impact of this enormous shift in positions on the long-term ability of 
the National Park Service to protect our national legacy.
    In addition, Congress did not authorize the expenditure of funds to 
conduct these studies. The Park Service has been very careful to spend 
less than $500,000 at a time, thus avoiding the reprogramming 
requirements of the appropriations committees. But, in total, they have 
spent much more than this amount, and recently submitted a 
reprogramming request only after the enormous criticism they received 
from congressional appropriators.
    In one example of expenditures, Deputy Assistant Interior Secretary 
Scott Cameron sent a letter to Congressman Doug Bereuter on May 30, 
2003, explaining:

          ``The Star Mountain/CH2Mhill contractor team competed among 
        three GSA Schedule contractors to perform five studies 
        involving NPS maintenance and architect/engineer services, as 
        well as the Midwest and Southeast Archeological Centers for 
        $872,491. The contract cost attributable to the two 
        Archeological Centers studied was $412,766, or roughly $200,000 
        per Center.''

    To the best of our knowledge, nowhere has the Park Service or the 
Interior Department explained what Park Service needs went unmet in 
order to pay for these expensive studies.
    Importantly, in the face of enormous pressure, the Park Service 
leadership earlier this year raised concerns about the cost and impact 
of the outsourcing initiative to the Interior Department leadership. 
The Park Service, itself, raised the possibility that funding these 
studies could force parks to reduce the number of seasonal rangers 
hired during the summer months--the very people who serve summer 
visitors--thereby diminishing the experience of the public. We have 
similar concerns, and share the concerns raised at that time about 
costs and the potential impact on the diversity of the Park Service 
workforce.

                          CONGRESSIONAL ACTION

    Concern for how the Interior Department and the U.S. Forest Service 
have handled this issue led the House of Representatives, on a 
bipartisan basis, not only to prevent the administration from requiring 
these agencies to conduct any outsourcing studies during fiscal year 
2004, but also from finalizing the study of the Park Service's Midwest 
and Southeast Archeology Centers. According to the report of the House 
Appropriations Committee:

          ``The Committee remains concerned about the massive scale, 
        seemingly arbitrary targets, and considerable costs associated 
        with this initiative, costs which are expected to be absorbed 
        by the agencies at a time when federal budgets are declining . 
        . . This massive initiative appears to be on such a fast track 
        that Congress and the public are neither able to participate 
        nor understand the costs and implications of the decisions 
        being made.''

    During the debate on the archeology centers, Congressman Bereuter, 
who authored the amendment to prevent their outsourcing said, ``Now, I 
do not resist A-76. I have consented and gone along with A-76 for other 
Federal employment in my district. But this process is flawed from the 
beginning.'' He went on to say:

          ``There are only three such centers in the United States. We 
        are dealing with two of them here, the majority of the 
        archaeological capability. It is mentioned that they frequently 
        do things for other parts of the Federal Government. They have 
        been involved in looking for the remains of the POWs and MIAs 
        in Vietnam. They were involved in examining the sites of the 
        war crimes in the Balkans. This is a particular expertise that 
        will never, ever, be put back in place again if it is 
        destroyed.

    These employees and centers should never have been categorized this 
way. It is a mistake. They do not want to admit it. Their consultants 
say it was a mistake, and they have been hushed up as a result with 
pressure from the National Park Service, pressure which ultimately does 
come, as the distinguished gentleman from Alaska suggested, from OMB. 
It is a bean counter that is doing something that is senseless.''

    Congressman Don Young, who supported the amendment and keeping the 
archaeology centers in Park Service hands, said, ``I believe in a lot 
of privatization, but archaeology is a system that has to be addressed 
by professionals, and these people are truly professionals.'' NPCA 
would submit that many more of the positions subject to outsourcing at 
the Park Service may very well be similarly situated.
    For example, the Management Summary for 2002 and 2003 for the 
Vanishing Treasures program at the Park Service indicates the program 
was designed ``to bring Vanishing Treasures sites to a condition where 
routine maintenance will suffice for their preservation and the 
necessary cadre of skills and expertise can be rebuilt and maintained . 
. . approximately $8 million is needed for a preservation work force 
estimated at 150 individuals.'' It goes on to state, ``For the duration 
of the Program, funding will be sought for high priority and emergency 
preservation projects and to recruit and train craftspeople and subject 
matter experts such as archeologists, engineers, and historical 
architects.''The Park Service has yet to hire even half of the staff 
contemplated by the initiative, yet it is these very types of people 
who may be subjected to outsourcing under the administration's 
initiative.

                   NATIONAL PARKS ARE MISSION DRIVEN

    Working in America's national parks is for many park staff more 
than just a job--it is a calling. Unlike nine-to-five contract workers, 
park staff has an extraordinary sense of commitment to their jobs that 
provides an extra benefit to the national parks and to park visitors. 
The overlap between the lives and the jobs of National Park Service 
employees is enormous. A Park Service maintenance person or resource 
specialist may be red carded to fight fires or might volunteer to give 
interpretive talks on weekends. There are many examples of this. In 
fact, few job descriptions reflect the breadth of contribution made by 
park staff, and it is enormously difficult to see how a low-bidding 
contractor could replicate the personal dedication and expertise of 
Park Service staff. In fact, the administration's privatization efforts 
have already jeopardized the esprit de corps of the Park Service and 
could undermine its mission.
    As Vice President Cheney observed in 2001, ``People expect rangers 
to know just about everything, and they usually do. The typical park 
ranger works as a historian, resource manager, law enforcement officer, 
curator, teacher--and sometimes paramedic and rescuer.'' Park Service 
staff knows and does just about everything. The multi-tasking nature of 
such positions cannot be reproduced in a contract mechanism, except at 
much higher expenditures of already scarce resources, and would likely 
result in a net loss of services without significant savings.
    From the point of view of the public, everyone who wears the 
uniform of the National Park Service is a park ranger. Because of 
reductions in the number of individuals employed in the technical 
ranger series over the years, staff in other positions has increasingly 
provided the public face of the Park Service.
    The administration wisely said it would not outsource ranger 
positions in the 0025 series, declaring them to be inherently 
governmental. Nonetheless, it completely missed the point by ignoring 
the critical nature of many other positions that will still be 
outsourced, and by placing decision-making authority in the wrong 
hands. Curators, historians, and resource managers throughout the park 
system are subject to being contracted out, as are environmental 
protection specialists, anthropologists, recreation specialists, and a 
whole manner of individuals who serve and educate the public. And the 
people who know the parks least are driving those decisions.
    The people of the National Park Service--from rangers to visitor 
center staff to masons, open the eyes of hundreds of millions of 
visitors every year to the natural and cultural wonders of the parks. 
But with the resources of the Park Service stretched to the limit, many 
of these same people must now expend enormous time, energy and cost to 
justify their jobs in an institution that has a 97 percent popularity 
rating with the American public.
    The contribution of National Park Service personnel to the 
enjoyment of visitors and to their appreciation and understanding of 
the parks should not be underestimated. The central role for 
interpretation in the parks has been apparent from the beginning. As 
Freeman Tilden, the father of modern interpretation, observed half a 
century ago, few people who go to the parks are there for a course in 
botany, archaeology, biology, or geology. He said that when people 
visit the extraordinary wonders of places like Yosemite, Mount Rainier, 
and elsewhere, ``These things are no longer something just to look at; 
they are something to wonder about.'' In Tilden's words:

          ``If the blind man who was shown the crater of ancient Mount 
        Mazama had happened to be on the trail with a naturalist, he 
        would have found that sight, however precious, is not the only 
        desirable sense, for the guide would have made plants come to 
        keen perception by their odors and tastes; trees by the feeling 
        of their bark; birds by their call-notes and songs. Even many 
        rocks can be recognized, or guessed, by touch, especially when 
        one knows the kind of rocks that might be expected to occur in 
        a locality.''

    Depending on the size of or resources available in any given park, 
all manner of staff, from maintenance personnel to archaeologists, play 
important roles in enriching the experience of park visitors through 
interpretation and in providing other assistance to park visitors. This 
is particularly true in smaller park units. It would be folly to 
undermine such service and commitment by rushing to focus on job 
categories and position descriptions, rather than on the systemic 
impact on the parks.
    It is critically important that the national parks be run as 
efficiently as possible, particularly when they face enormous funding 
needs and when so many Americans are turning to them as a way to 
reconnect with their heritage. Indeed, NPCA strongly supports the park 
specific assessment of needs that can be used to determine whether and 
when outsourcing or competitive sourcing of positions can benefit the 
park's mission. This has already been done in 10 percent of the parks. 
Contrary to administration assertions about the current outsourcing 
process promoting efficiency, Interior's implementation of competitive 
sourcing has not been thoughtful, considered, or appropriately focused, 
and it takes the key decisions out of the hands of those who best 
understand the on-the-ground situation in individual parks.
    It is also critically important that efficiency itself not become 
the end for which we strive in the parks. In some cases, even the 
option that first appears to be more efficient may be much less 
protective of a park in the long run. That is why the parks, 
themselves, must be the ones to drive any outsourcing decisions. There 
are many cases when specific park managers, after careful business 
planning and analysis of their mission and needs, have contracted for 
services that could help them fulfill their mission. Park managers know 
best what their people do. No two parks are exactly alike, and small 
remote parks may have very different personnel needs from others. A 
top-down, bureaucratic process with quotas set inside the Washington 
Beltway cannot adequately reflect the specific situation and needs of 
individual national parks.
    The mission of the National Park Service, as set forth in the 1916 
Organic Act, should always be paramount: ``to conserve the scenery and 
the natural and historic objects and the wild life therein and to 
provide for the enjoyment of the same in such manner and by such means 
as will leave them unimpaired for the enjoyment of future 
generations.'' The fulfillment of that mission requires dedicated 
people, and should be considered an inherent responsibility of 
government.

                DIVERSITY OF THE PARK SERVICE WORKFORCE

    Importantly, privatization threatens to further limit the ethnic 
diversity of the Park Service workforce in part because many of the 
jobs targeted for outsourcing are located in metropolitan areas such as 
Washington, D.C., San Francisco, and Santa Fe, and are held by people 
of color. The Park Service has made great strides recently in 
increasing the diversity of park staff; privatization will destroy this 
momentum at the expense of providing opportunities for the private 
sector.
    Even if some of the outsourced employees are hired by outside 
contractors, the impact could be a reduction of career-track 
opportunities to advance within the Park Service. The administration 
should be spending at least as much effort to provide career track 
opportunities that enhance the diversity of the Park Service workforce 
as it is spending to force these individuals to re-compete for their 
jobs.

                               CONCLUSION

    OMB's rewrite of A-76 threatens to undermine the ability of the 
strongly committed, mission-focused National Park Service staff to 
continue to adequately protect the 388 units of the National Park 
System. NPCA supports outsourcing in appropriate circumstances after 
careful analysis. However, no careful analysis of the contracting that 
has already occurred has ever been conducted. It is reasonable to 
require a pause in the administration's outsourcing effort in order to 
protect our national heritage and the experiences of nearly 300 million 
visitors who visit our national parks every year.
                                 ______
                                 
           Statement of the Society for American Archaeology

    The Society for American Archaeology (SAA) appreciates the 
opportunity to submit these comments on outsourcing at the National 
Park Service (NPS) for the record of today's subcommittee hearing.
    SAA is an international organization that, since its founding in 
1934, has been dedicated to the research, interpretation, and 
protection of the archaeological heritage of the Americas. With more 
than 6,600 members, the Society represents professional archaeologists 
in colleges and universities, museums, government agencies, and the 
private sector. SAA has members in all 50 states as well as many other 
nations around the world.
    SAA wishes to make clear at the outset that it takes no position as 
an organization on the merits or drawbacks of outsourcing certain 
positions within the NPS Archaeology and Ethnography Program. It is 
crucial, however, that the possible effects of outsourcing decisions on 
the protection, management, and interpretation of archaeological 
resources within the Park System be given serious scrutiny. We are 
concerned that the process now underway for determining whether 
particular functions within the Archaeology and Ethnography Program are 
inherently governmental or not is proceeding without enough importance 
being placed on the question of future resource stewardship in the 
parks.
    NPS is the steward of some of the most significant archaeological 
resources in the U.S.; by some estimates, there are as many as one 
million archaeological sites within the Park System. Many parks with 
important archaeological resources do not have on-staff archaeological 
expertise and are dependent on the regional centers for ongoing, day-
to-day assistance in cultural resource management and compliance 
decisions. Additionally, other federal agencies, as well as state 
agencies and tribal preservation programs, sometimes depend on NPS 
archaeological staff, particularly in the regional centers, for 
specialized advice and expertise on a timely, as-needed basis. 
Archaeological resources are both subtle and fragile--familiarity with 
the resources of a particular region or set of parks, and institutional 
memory about previous work and preservation efforts an about past 
decisions and the reasons for them, are necessary components of good 
resource management.
    Familiarity with NPS procedures, mission, and corporate culture 
makes NPS archaeologists particularly effective at working with park 
managers and fitting archaeological stewardship measures into the 
ongoing activities of individual parks. The A-76 process, however, 
specifically requires that activities involving NPS policy development 
be segregated from activities involved in routine archaeological 
resource management. If implemented, this artificial separation between 
policy development and actual on-the-ground resource management could 
have serious negative implications for archaeological sites in the 
parks.
    SAA is not suggesting that outsourcing, per se, is detrimental to 
archaeological resources. As an organization, we support outsourcing of 
archaeological compliance and research work by federal agencies when 
there is appropriate planning to ensure that the archaeological 
resources will receive the best possible management, interpretation, 
and protection. In fact, NPS already outsources substantial amounts of 
work, some to private sector firms and some through cooperative 
agreements with colleges and universities. The work that is outsourced 
through the cooperative programs provides the added benefit of training 
opportunities for students. If the competitive outsourcing model 
envisioned by the A-76 process were to be implemented, outsourcing 
through, cooperative projects with colleges and universities would no 
longer be possible,
    SAA strongly supports participation by a broad spectrum of 
professional archaeologists in developing innovative management 
strategies and cutting-edge research programs within federal agencies. 
The inclusion of archaeologists from academic institutions and private 
sector firms in archaeological resource management within NPS, whether 
through outsourcing or cooperative agreements, has been and can 
continue to be positive, both for the resources and for the agency.
    We are concerned, however, that the current outsourcing studies 
have been conducted without input or review by the archaeological 
profession, and we question whether adequate consideration has been 
given to the potential effects of the decisions that are being made on 
the world class archaeological resources under the stewardship of the 
National Park Service.
    Thank you for allowing SAA to testify on this important issue.

                                    


```