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52–326 2009

THE SOCIAL SECURITY ADMINISTRATION’S 

PROVISIONS IN THE AMERICAN RECOVERY 

AND REINVESTMENT ACT OF 2009 

HEARING 

BEFORE THE

SUBCOMMITTEE ON SOCIAL SECURITY 

OF THE

COMMITTEE ON WAYS AND MEANS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

APRIL 28, 2009 

Serial No. 111–16 

Printed for the use of the Committee on Ways and Means 

( 

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COMMITTEE ON WAYS AND MEANS 

CHARLES B. RANGEL, New York, Chairman 

FORTNEY PETE STARK, CALIFORNIA 

SANDER M. LEVIN, MICHIGAN 

JIM MCDERMOTT, WASHINGTON 

JOHN LEWIS, GEORGIA 

RICHARD E. NEAL, MASSACHUSETTS 

JOHN S. TANNER, TENNESSEE 

XAVIER BECERRA, CALIFORNIA 

LLOYD DOGGETT, TEXAS 

EARL POMEROY, NORTH DAKOTA 

MIKE THOMPSON, CALIFORNIA 

JOHN B. LARSON, CONNECTICUT 

EARL BLUMENAUER, OREGON 

RON KIND, WISCONSIN 

BILL PASCRELL, JR., NEW JERSEY 

SHELLEY BERKLEY, NEVADA 

JOSEPH CROWLEY, NEW YORK 

CHRIS VAN HOLLEN, MARYLAND 

KENDRICK B. MEEK, FLORIDA 

ALLYSON Y. SCHWARTZ, PENNSYLVANIA 

ARTUR DAVIS, ALABAMA 

DANNY K. DAVIS, ILLINOIS 

BOB ETHERIDGE, NORTH CAROLINA 

LINDA T. SA ́ NCHEZ, CALIFORNIA 

BRIAN HIGGINS, NEW YORK 

JOHN A. YARMUTH, KENTUCKY 

DAVE CAMP, MICHIGAN 

WALLY HERGER, CALIFORNIA 

SAM JOHNSON, TEXAS 

KEVIN BRADY, TEXAS 

PAUL RYAN, WISCONSIN 

ERIC CANTOR, VIRGINIA 

JOHN LINDER, GEORGIA 

DEVIN NUNES, CALIFORNIA 

PATRICK J. TIBERI, OHIO 

GINNY BROWN-WAITE, FLORIDA 

GEOFF DAVIS, KENTUCKY 

DAVID G. REICHERT, WASHINGTON 

CHARLES W. BOUSTANY, JR., LOUISIANA 

DEAN HELLER, NEVADA 

PETER J. ROSKAM, ILLINOIS 

JANICE MAYS, Chief Counsel and Staff Director 

JON TRAUB, Minority Staff Director 

SUBCOMMITTEE ON SOCIAL SECURITY 

JOHN S. TANNER, Tennessee, Chairman 

EARL POMEROY, North Dakota 

ALLYSON Y. SCHWARTZ, Pennsylvania 

XAVIER BECERRA, California 

LLOYD DOGGETT, Texas 

RON KIND, Wisconsin 

JOSEPH CROWLEY, New York 

LINDA T. SA ́ NCHEZ, California 

JOHN A. YARMUTH, Kentucky 

SAM JOHNSON, Texas, Ranking Member 

KEVIN BRADY, Texas 

PATRICK J. TIBERI, Ohio 

GINNY BROWN-WAITE, Florida 

DAVID G. REICHERT, Washington 

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records 

of the Committee on Ways and Means are also published in electronic form. The printed 

hearing record remains the official version. Because electronic submissions are used 

to prepare both printed and electronic versions of the hearing record, the process 

of converting between various electronic formats may introduce unintentional errors 

or omissions. Such occurrences are inherent in the current publication process and 

should diminish as the process is further refined. 

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C O N T E N T S 

Page 

Advisory of April 21, 2009 announcing the hearing ............................................. 2 

WITNESSES 

Mary Glenn-Croft, Deputy Commissioner for Budget, Finance and Management, Social Security Administration ................................................................ 7 

Robert Hewell, Acting Deputy Commissioner, Public Buildings Service, 

United States General Services Administration ............................................... 14 

The Honorable Patrick P. O’Carroll, Inspector General, Social Security Administration .......................................................................................................... 22 

Valerie Melvin, Director of Information Management and Human Capital 

Issues, U.S. Government Accountability Office ................................................. 26 

Sylvester J. Schieber, Chairman, Social Security Advisory Board ...................... 42 

SUBMISSIONS FOR THE RECORD 

Dale and Linda Walker, Statement ....................................................................... 91 

Larry S. Stoudemire, Letter .................................................................................... 91 

The National Association of Disability Examiners, Statement ............................ 91 

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(1) 

THE SOCIAL SECURITY ADMINISTRATION’S 

PROVISIONS IN THE AMERICAN RECOVERY 

AND REINVESTMENT ACT OF 2009 

TUESDAY, APRIL 28, 2009 

U.S. HOUSE OF REPRESENTATIVES, COMMITTEE ON WAYS AND MEANS, SUBCOMMITTEE ON SOCIAL SECURITY, Washington, DC. 

The Subcommittee met, pursuant to call, at 2:01 p.m., in room 

B–318, Rayburn House Office Building, the Honorable John Tanner 

(Chairman of the Subcommittee) presiding. 

[The advisory of the hearing follows:] 

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ADVISORY 

FROM THE COMMITTEE ON WAYS AND MEANS 

SUBCOMMITTEE ON SOCIAL SECURITY 

FOR IMMEDIATE RELEASE CONTACT: (202) 225–9263 

April 21, 2009 

SS–2 

Congressman Tanner Announces Oversight 

Hearing on the Social Security Administration’s 

Provisions in the American Recovery 

and Reinvestment Act of 2009 

Congressman John S. Tanner (D–TN), Chairman, Subcommittee on Social Security, announced an oversight hearing on the progress made by the Social Security 

Administration (SSA) in implementing the American Recovery and Reinvestment Act 

of 2009. The hearing will take place on Tuesday, April 28, 2009 in room B– 

318 Rayburn House Office Building, beginning at 2:00 p.m. 

In view of the limited time available to hear witnesses, oral testimony at this 

hearing will be from invited witnesses only. However, any individual or organization 

not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. 

BACKGROUND: 

In February, Congress passed and the President signed the American Recovery 

and Reinvestment Act of 2009 (ARRA, Pub. L. 111–5), landmark legislation designed 

to create jobs, promote economic recovery, assist people most impacted by the recession, and make investments in infrastructure and technology to increase economic efficiency and provide long-term economic benefits. 

The Recovery Act made a significant and strategic investment in SSA, to ensure 

that the agency is capable of continuing its vital role in helping American families 

meet their financial needs during retirement, in case of disability, or after the death 

of a wage earner. A decade of funding below the President’s request had left SSA 

with a decreased ability to meet the requirements of serving an aging society. As 

a result, the agency was also ill-prepared to deal with a significant increase in retirement and disability benefit claims caused by the current economic downturn. 

Post-9/11 enhancements to Government requirements for systems continuity in case 

of a disaster combined with SSA’s increasing use of electronic processes also require 

modernization of its information technology systems, including complete replacement of its nearly obsolete National Computer Center (NCC). Moreover, ARRA’s 

provision of one-time economic recovery payments to Social Security beneficiaries is 

intended to give some financial help to retired and disabled Americans, who are 

most likely to be impacted by the economic crisis. 

SSA’s national computer processing and data storage facility, the NCC, houses 

450 million records of Americans’ earnings and benefit data for almost 56 million 

beneficiaries. It performs a billion electronic transactions annually in the administration of benefits and data-matching agreements with other Federal, state and local 

agencies. As reliance on electronic processing and technology grows—both within 

SSA and among other Federal, state and local agencies—so does the need to ensure 

the NCC is able to function effectively. The NCC is nearly thirty years old. It is 

nearing the end of its useful physical life, its capacity is inadequate to meet anticipated future needs, and deterioration of the facility is posing increasing risks to SSA 

operations. Questions have been raised concerning why replacement of the NCC bewwoods2 on DSKGBLS3C1PROD with HEARING

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came an unforeseen and urgent priority, and whether steps can be taken by SSA 

to avoid such crises in the future. ARRA provided SSA with $500 million to begin 

the process of replacing the existing NCC. This amount is expected to cover the cost 

of building a new facility and part of the cost of equipping it. 

In addition, SSA’s workload in processing new claims for retirement and disability 

benefits began to increase significantly in FY 2009 as a result of the economic downturn combined with the aging of the population. SSA estimated that processing the 

increased number of claims will cost the agency $900 million more in FY 2009–10 

than was previously projected. ARRA provided SSA with $500 million as a downpayment on the cost of processing these recession-driven claims. 

Finally, ARRA provided most Social Security, Railroad Retirement Board, Veterans Administration, and Supplemental Security Income (SSI) beneficiaries with a 

one-time, additional payment of $250 to help stimulate economic recovery. Direct 

payments to retirees and people with disabilities have a beneficial impact on the 

economy, as beneficiaries with modest incomes are more likely to spend the money 

on immediate needs rather than save it. SSA has notified its beneficiaries of the 

upcoming payments and anticipates their distribution several weeks ahead of the 

June statutory deadline. 

In announcing the hearing, Chairman John Tanner (D–TN) stated, ‘‘Congress 

counts on the Social Security Administration to reliably serve America’s retirees, people with disabilities and survivors, providing needed benefits in 

a timely manner. In the Recovery Act, Congress made a significant investment in SSA’s capacity to continue to effectively serve our constituents. 

This hearing will allow the Subcommittee to learn how SSA is managing 

this investment, to ensure that waste is avoided and all due effort is made 

to maintain the high level of customer service for which the agency historically has been known.’’ 

FOCUS OF THE HEARING: 

The hearing will focus on the progress made by SSA and other involved agencies 

in using ARRA resources to replace the NCC; SSA’s use of ARRA funding to process 

recession-driven claims; and the agency’s plans for distributing the $250 economic 

recovery payments to over 50 million recipients. 

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS: 

Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee 

website and complete the informational forms. From the Committee homepage, 

http://waysandmeans.house.gov, select ‘‘Committee Hearings’’. Select the hearing for 

which you would like to submit, and click on the link entitled, ‘‘Click here to provide 

a submission for the record.’’ Once you have followed the online instructions, complete all informational forms and click ‘‘submit’’ on the final page. ATTACH your 

submission as a Word or WordPerfect document, in compliance with the formatting 

requirements listed below, by close of business Tuesday, May 12, 2009. Finally, 

please note that due to the change in House mail policy, the U.S. Capitol Police will 

refuse sealed-package deliveries to all House Office Buildings. For questions, or if 

you encounter technical problems, please call (202) 225–1721. 

FORMATTING REQUIREMENTS: 

The Committee relies on electronic submissions for printing the official hearing 

record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, 

but we reserve the right to format it according to our guidelines. Any submission 

provided to the Committee by a witness, any supplementary materials submitted for 

the printed record, and any written comments in response to a request for written 

comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will 

be maintained in the Committee files for review and use by the Committee. 

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1. All submissions and supplementary materials must be provided in Word or WordPerfect 

format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official 

hearing record. 

2. Copies of whole documents submitted as exhibit material will not be accepted for printing. 

Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material 

not meeting these specifications will be maintained in the Committee files for review and use 

by the Committee. 

3. All submissions must include a list of all clients, persons, and/or organizations on whose 

behalf the witness appears. A supplemental sheet must accompany each submission listing the 

name, company, address, telephone, and fax numbers of each witness. 

The Committee seeks to make its facilities accessible to persons with disabilities. 

If you are in need of special accommodations, please call 202–225–1721 or 202–226– 

3411 TTD/TTY in advance of the event (four business days notice is requested). 

Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above. 

Note: All Committee advisories and news releases are available on the World 

Wide Web at http://waysandmeans.house.gov. 

f 

Chairman TANNER [presiding]. If Mr. Brady has arrived, we 

could come to order. 

I thank all of you for being here, particularly our witnesses. 

This hearing today is about the implementation of the so-called 

stimulus bill, the American Recovery and Reinvestment Act, and, 

basically, there are two or three things that we want to talk about 

here with our witnesses. One, of course, is the resources that were 

made available for the backlog and the problems that we have been 

having with that, and secondly is the somewhat urgent need to 

move on a new facility for the Social Security Administration. 

This came to us late in the day, as one might say, about the urgency of the problems out at the site, the National Computer Center, and, therefore, Congress responded with some moneys in the 

stimulus package to address this issue. And, finally, we will talk 

a little about the stimulus bill and the recovery payments and so 

forth that is contained therein. 

Unfortunately, Mr. Johnson, our Ranking Member on the Subcommittee, could not be here today, and so, at this time, I would 

like to ask Mr. Brady for any comments he may have as the Ranking Member. And thank you. 

Mr. BRADY. Great, Chairman. Thanks for having us. 

I am pleased to be filling for our Ranking Member, Sam Johnson, 

who is remaining in Texas for part of the day and will start by 

reading his opening statement for today’s hearing. 

This Committee, as the chairman said, has long worked on a bipartisan basis to ensure Social Security has the resources it needs. 

In the last 2 years, Congress has provided funding at levels higher 

than the President’s request, and the Recovery Act provides an additional $1 billion to build a new computer center and to process 

increased workloads due to the economic downturn. 

Today, we will begin to learn how Social Security is using these 

funds and whether they are doing so in ways that provide real results to the American people without squandering substantial taxpayer investments. 

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First, these results must include restoring service delivery and 

protecting Americans’ personal information and in the event of a 

major failure at the 30-year-old National Computer Center. Second, 

delays our constituents face when they visit or contact the local Social Security office, call the 800 number, or wait over 16 months 

for a decision on their disability appeal before administrative law 

judge must be reversed. 

Third, efforts to address program waste, fraud, and abuse, including conducting continuing disability reviews, must be increased 

in order to save billions in program dollars and build taxpayer confidence. Finally, whether Social Security will achieve these results 

now and in the future depends on their ability to effectively and 

strategically modernize its technology infrastructure as it purchases a new National Computer Center and builds the capacity of 

the second data center in Durham. 

As said in a recently released bipartisan Social Security Advisory 

Board report, ‘‘There is much that remains to be done to establish 

a truly robust and modern IT infrastructure that will truly support 

service delivery in the 21st century, and time may be running 

short.’’ 

In closing, as we address Social Security service delivery challenges, we cannot just ignore the fiscal challenge Social Security 

faces. President Obama has expressed his commitment to advance 

Social Security reform. We all know the sooner we act to protect 

and strengthen Social Security, the better. 

So I hope this Subcommittee can begin work on a bipartisan 

basis as soon as possible to examine options and find solutions. 

Thank you, Chairman. 

Chairman TANNER. Thank you, Mr. Brady. 

The Chair would ask unanimous consent that his statement and 

all others on the Committee be inserted into the record. Without 

objection. 

[The statement of Mr. Johnson follows:] 

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f 

Chairman TANNER. In addition, I would like to ask unanimous 

consent that all of the statements of the witnesses that are going 

to testify be inserted into the record. Without objection. Thank you. 

And now may I call on Ms. Glenn-Croft first for your testimony. 

You are recognized. And, please, if you could observe the 5-minute 

rule, we would appreciate it. 

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52326a.001
7 

STATEMENT OF MS. MARY GLENN-CROFT, DEPUTY COMMISSIONER FOR BUDGET, FINANCE AND MANAGEMENT, SOCIAL 

SECURITY ADMINISTRATION 

Ms. GLENN-CROFT. I will do that. 

Chairman Tanner, Ranking Member Brady, and Members of the 

Subcommittee, good afternoon. I am Mary Glenn-Croft, Social Security senior accountable official for the use of Recovery Act funds. 

On behalf of Commissioner Astrue, I appreciate the opportunity 

to discuss how these funds will help us process our increasing 

workloads and replace our aging National Computer Center. I will 

also share our plan to oversee our Recovery Act responsibilities, including issuing one-time $250 economic recovery payments to Social Security and SSI beneficiaries. 

Let me begin by thanking you for the significant investment you 

are making in our agency and for the trust that you have in us to 

get the job done. The Recovery Act provides us with $500 million to process what 

we expect to be the highest levels of disability and retirement 

claims we have ever seen. This fiscal year, because of the twin 

forces of the economic downturn and the first baby boomers retiring, we expect to receive over 300,000 more retirement claims, 

about a 9-percent increase, and 300,000 more disability claims, 

about a 12-percent increase, over last year. Fiscal year 2009 appropriations and Recovery Act funding will allow us to process most, 

if not all, of the additional retirement claims, hold 75,000 additional hearings, and process an additional 30,000 disability claims. 

We will also hire more than 2,000 people with the Recovery Act 

funding this fiscal year. About 1,500 of these new hires will provide 

direct service to help people file claims, adjudicate applications, 

and answer the public’s questions. We will hire 35 additional administrative law judges and 550 support staff in hearing offices, 

and we will provide funding for 300 new employees in the state disability determination services. 

In addition, we will authorize overtime and frontline components 

to process critical workloads. We have already recruited and hired 

a highly diverse group of more than 1,400 new employees. New 

hires will make a real difference in the service we provide to the 

American public, although it will take some time for us to fully 

train them. Our combined fiscal year 2009 annual appropriation 

and the Recovery Act funding will allow us to hire over 7,000 employees by September. The Recovery Act authorized us to spend part of the $500 million 

on technology investments, including health information technology. We will spend about $16 million dollars of Recovery Act 

funding on computers and other equipment our new hires will 

need. We will also invest in video-conferencing equipment and increased bandwidth to support the hearings process. We intend to 

spend $24 million to contract with the health care community to 

provide us with electronic health records to improve the speed and 

accuracy of our disability determination process. 

Congress also acknowledged our long-term information tech- nology needs by providing $500 million to replace and partially 

equip our national Computer Center. The NCC is the technological 

heart of the agency, housing critical computer operations and data 

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essential to provide prompt and accurate benefit payments to millions of Americans. Because the NCC is 30 years old, eventually, 

it will be unable to support the growing demand of our computer 

systems and electronic services. This funding will ensure that a 

new data center will be operational as the NCC nears the end of 

its functional life. 

We are working collaboratively with the General Services Administration to formulate specific requirements for a state-of-the-art 

data center and to develop criteria for a building site. As of April 

1, GSA awarded a contract to a construction management firm, and 

we are currently providing that firm with information to define 

building requirements and land specifications. 

We strongly support the accountability and transparency standards Congress established for Recovery Act funds. As recommended 

by OMB, our executive internal control Committee will oversee Recovery Act performance across the agency. We have established 

oversight workgroups for each of our Recovery Act efforts, and in 

compliance with reporting requirements, we were one of the first 

agencies to put up a recovery Web site and submit our weekly reports to OMB. We are also working closely with our inspector general’s office as it plans additional oversight of Recovery Act funding. Finally, the Recovery Act provides for one-time $250 economic recovery payments to Social Security and SSI recipients. Although 

implementing this legislation required extensive coordination with 

other Federal agencies, we are on track to issue these payments in 

May, 3 weeks earlier than the statute requires. These payments to 

more than 50 million people will inject over $13 billion into the 

economy. 

Again, we greatly appreciate the actions of Congress to provide 

assistance to the American people in this time of economic hardship, and we thank you for providing us with the funding we need 

to help in these efforts. We will keep the Committee apprised of 

our progress, and we look forward to your continued support as we 

implement the plans I have described above. 

I would be happy to answer any of your questions. 

Thank you. 

[The statement of Ms. Glenn-Croft follows:] 

Statement of Mary Glenn-Croft, Deputy Commissioner for Budget, 

Finance and Management, Social Security Administration 

Thank you for the opportunity to describe the important and ambitious projects 

that we at the Social Security Administration are undertaking with the funds that 

you appropriated to us through the American Recovery and Reinvestment Act of 

2009 (Recovery Act) I want to thank you on the agency’s behalf for the significant 

investment you are making in us and for the trust that you have in us to get the 

job done. 

We realize that many of our fellow citizens are suffering because of the current 

economic downturn. Jobs have become scarcer; homes have been lost, and too many 

of our neighbors are facing increased difficulty in making ends meet. Undoubtedly, 

these are challenging times. Nevertheless, we believe that we have a unique opportunity to serve the millions of Americans who rely upon our programs and to continue to provide them with the quality service they deserve. 

As the Senior Accountable Official, I am responsible for overseeing how we use 

the Recovery Act resources. Under the Recovery Act, you afforded us $500 million 

to tackle our retirement and disability workloads—$40 million of which we may use 

for health information technology initiatives. You also gave us $90 million to administer economic recovery payments and $500 million to construct and partially equip 

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1St. Petersburg, FL; Tallahassee, FL; Atlanta South, GA; Topeka, KS; Mt. Pleasant, MI; 

Livonia, MI; Akron, OH; Toledo, OH; Fayetteville, NC, and Madison, WI. The three additional 

offices will be in Auburn, WA; Phoenix, AZ, and either Danville or Portage, IN. 

a new data center to replace our aging National Computer Center (NCC). This substantial investment will help us address the dramatically increasing service demands caused by the combination of a weakened economy and increased baby boomer retirements. 

Today, I will discuss how these Recovery Act resources will help us process our 

increasing workloads and replace our aging NCC. I will share with you the agency’s 

plan to oversee all of our Recovery Act responsibilities, including paying $250 to millions of Social Security and Supplemental Security Income (SSI) beneficiaries. 

PUTTING RECOVERY FUNDS TO WORK—HIRING AND PROCESSING 

WORKLOADS 

The Recovery Act gives us $500 million to process the increased number of disability and retirement claims we are seeing because of the economic downturn and 

the beginning of the baby boomer retirement wave. If our projections hold true, we 

will receive and process more claims this year than in any prior year. With the fiscal year (FY) 2009 appropriation and the Recovery Act funding, we plan to process 

over 300,000 more retirement claims, 30,000 more disability claims, and nearly 

75,000 more hearing requests this fiscal year than we did in FY 2008. 

We will use a significant portion of this funding to hire and train new employees 

and to provide additional overtime so that we can process critical workloads. Of 

more than 7,000 new hires that we are making this fiscal year, the Recovery Act 

funding will allow us to hire more than 2,000 Federal employees and the States to 

hire additional disability examiners. Specifically, in the near term: 

• Our field operations will hire 1,500 employees in local field offices, teleservice 

centers, and processing centers; 

• Our hearings offices will hire 550 new employees and 35 additional administrative law judges, and 

• State disability determination services (DDS) throughout the country will hire 

300 additional disability examiners. 

In total, by September of this year, with our FY 2009 appropriation and the Recovery Act funding, we will hire over 7,000 employees. We will assign these new employees throughout the agency and across the country to provide a much-needed increase in our staffing level. 

Additional employees, of course, require additional space to house them. As Commissioner Astrue said during his appearance before this Subcommittee last month, 

we will open 10 new hearing offices in the near future.1 Earlier this month, he also 

decided to add 3 more offices, bringing the total number of new hearing offices to 

13. 

New hires will make a real difference in the service we will deliver to the public. 

With this increased staffing, we will be able to take more claims, whether in person 

or by telephone, to adjudicate more claims, and to serve callers to our national 800 

number. 

Recruitment and Training—A Long-Term Investment 

Hiring new employees is critical. Accordingly, as the Recovery Act moved through 

Congress, we instructed personnel offices and managers to be ready to hire as soon 

as we had an appropriation. To achieve a diverse and high-performing workforce, 

we will continue to seek employees through announcements on USAJOBS. We also 

will utilize the full range of hiring flexibilities, such as the excepted service appointment authorities for Veterans Recruitment Appointments and the Federal Career 

Intern Program. We are also working with the Office of Personnel Management 

(OPM) to obtain the necessary authority to hire reemployed annuitants for some of 

our highly technical positions since these individuals already possess the skill sets 

necessary to do the job. 

Realistically, new employees will not have an immediate impact on our current 

or backlogged workloads, as hiring and fully training new employees is a lengthy 

and resource-intensive process. The hiring process includes reviewing applications 

and resumes, conducting interviews, conducting background checks, and offering positions. Often, new employees must relocate to their duty stations or give their employers sufficient notice so that the employer may seek a replacement. Once new 

employees report to work, they will receive training that because of the complexity 

of our programs, generally lasts from 13 to 17 weeks. After this initial training, we 

assign a mentor to most new employees to help them learn the intricacies of procwwoods2 on DSKGBLS3C1PROD with HEARING

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2DDS employees in California, Maryland, Massachusetts, Ohio, and Oregon are currently subject to furloughs. 

essing our work. This on-the-job training typically lasts a full year. By the end of 

that year, though still not fully proficient in all parts of the job, these employees 

will begin to contribute significantly to workload processing. The time spent training 

and mentoring, however, reduces the time our more experienced employees have to 

process their own work, reducing productivity in the short run. 

Whenever we recruit and hire, we remain mindful of our firm commitment to a 

high-performing, diverse workforce. We are making a concerted effort to hire persons with disabilities by reaching out to Wounded Warrior transitional programs 

and Ticket to Work beneficiaries who are trying to return to the workforce. For example, on May 28, we will hold our second annual Hiring Heroes Career Fair at 

our Baltimore headquarters, and we expect over 100 military personnel and veterans with disabilities to attend. With Recovery Act funding, we have already hired 

a highly-diverse group of more than 1,400 employees. 

Fully Funded and Staffed DDSs Are Essential to Meeting Our Commitments 

When States are hiring DDS employees, they confront some of the same obstacles 

that we face when we hire employees. A number of States have introduced an additional challenge to fully staffing their DDSs by furloughing DDS employees in an 

effort to balance their budgets.2 Such practices are unnecessary since we fully fund 

the DDSs and reimburse the States for the salaries and benefits of all DDS employees. This fiscal year over 16,000 DDS employees will process more than 2.6 million 

disability claims. We will pay about $2 billion to the States to cover all payroll costs 

as well as the costs to obtain the health records and to perform the medical examinations necessary to adjudicate disability claims. 

We empathize with the budget struggles that States face in these difficult economic times, but States do not save any money when they furlough or lay off DDS 

employees. We estimate that if all States furloughed DDS employees for one day, 

they would lose $7.8 million in administrative funding that we pay to them. In addition, such furloughs would delay the processing of approximately 15,000 claims and 

the payment of $4.2 million of monthly benefits to their disabled residents. Furloughs and restrictions on hiring and overtime only delay payments to their disabled 

citizens who have applied for benefits. 

We appreciate your efforts in communicating with State leaders to help them understand the importance of having enough trained, full-time DDS employees on 

hand to process the influx of disability claims—an influx that we project will grow 

by more than 12 percent this fiscal year. Without enough fully trained and fully productive DDS employees, we risk limiting the processing gains that we can achieve 

with Recovery Act funds. 

We will need Congress’s continued support as we work with Governors, legislators, and other elected officials to ensure that DDSs have the staff needed to adjudicate the increased number of disability claims that we expect to arrive at their 

doors because of the economic downturn. 

Technology Investment Is Critical To Maintain and Expand Our Service to the American People 

The Recovery Act also authorizes us to spend part of the $500 million for technology investments including health information technology. We will spend about 

$16 million of Recovery Act funding on computers for our new employees, as well 

as video conferencing equipment and increased bandwidth, which will improve our 

telecommunications network. With this funding, we will be able to continue to reduce the hearings backlog. 

While all hearing offices now have at least one video conference connection, we 

are increasing the availability of video hearings in remote areas in order to reduce 

travel time for claimants and representatives who would otherwise have to drive 

long distances to reach a hearing office. The inability of some claimants and their 

representatives to attend face-to-face hearings can delay the disposition of their 

claims. Video conferencing addresses this situation by allowing claimants and their 

representatives to attend hearings remotely. 

Indeed, two weeks ago, Commissioner Astrue officially opened our new National 

Hearing Center (NHC) in Albuquerque, New Mexico. The Albuquerque NHC utilizes 

video conferencing that enables administrative law judges to hold remote disability 

hearings providing relief to those hearing offices that are struggling the most. Initially, the Albuquerque NHC will hear disability claims pending in Kansas City, 

Missouri and Portland, Oregon—two of the most backlogged offices in the country. 

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Moreover, we are a leader in the Federal Government in health information technology. We intend to spend $24 million of our Recovery Act funding to contract with 

a diverse group of health care providers and networks to provide us with electronic 

health records to improve the speed and accuracy of the disability determination 

process. As Commissioner Astrue told this subcommittee last month, we conducted 

a pilot project in Boston that allowed us to receive health records electronically in 

seconds and minutes, rather than the usual weeks and months that it takes to gather paper records. To improve the speed and quality of our disability determinations, 

we will use this funding to expand the number and kinds of health care records that 

providers can, with the claimant’s consent, send to us electronically. This funding 

will also be used to implement any new requirements that may be issued under the 

HITECH Act. Providers will be required to transmit to us structured electronic medical data based on standards established for use by the Nationwide Health Information Network. 

Significant Headway in Workload Processing 

Use of Recovery Act funds for hiring and technology will help us process our increasing workloads; however, improvements to processing times and claims pending 

will not happen overnight. Our current hearings backlog developed over time, and 

it will take time and sustained funding for us to reduce that workload to acceptable 

levels. In the near term, initial disability receipts will outpace our capacity to process them, and the initial disability claims backlog will rise. Just as we did with the 

hearings backlog, we are currently developing a multi-year plan to deal with the future increases of pending initial disability claims. 

The substantial investment you made to increase our staffing levels will allow us 

to make significant headway in workload processing over the next several years. 

The additional employees we hire and train this fiscal year will enable us to increase our capacity to process critical workloads in FY 2010. 

INCREASING OUR COMPUTER PROCESSING CAPABILITIES 

Of course, these hiring and technological gains are only a part of the solution. To 

move forward in this environment of increasing workloads, we must continue to be 

innovative and find additional efficiencies. We must use every tool at our disposal 

to meet the standard of service the public has come to expect from us. 

National Computer Center (NCC)—Limitations of the Existing Facility 

Congress acknowledged our long-term information technology needs in the Recovery Act by allocating $500 million to replace and partially equip our NCC. The NCC 

houses critical data and computer operations essential for promptly and accurately 

paying benefits to millions of Americans. Because it plays such an important role 

in our data processing operations and automation initiatives, I especially appreciate 

this opportunity to describe our prior efforts to maintain the NCC and the analysis 

that led us to realize that a new facility was essential. 

The NCC was designed over 30 years ago. Technology has changed radically since 

then, and we must upgrade the building’s cooling, electrical, and fire suppression 

systems to accommodate these new technologies. As a result, the NCC’s infrastructure systems will not be capable of accommodating the information technology necessary to handle our increasing volumes of work, our new and expanded responsibilities, and our new ways of doing business. Our transition to full electronic processing of our core workloads and the growth of electronic service delivery over the 

last decade resulted in a dramatic increase in our needs for data storage and network capacity. While we have modernized our hardware, we are facing finite limitations on our ability to distribute electrical power to our servers and mainframes. 

Updated servers and mainframes have significant electrical requirements. Until 

recently, each server required only one power supply to operate; now, a server requires two to four power supplies to function, which the NCC can accommodate at 

this time. The current electrical panels will not be able to accommodate the more 

than four power supplies that we will need to run servers in the future. 

As the NCC has aged, we have continuously upgraded and repaired structural, 

electrical, and data processing capabilities. Incrementally upgrading a facility of this 

kind is a best industry practice for maintaining facilities beyond their life cycle. We 

must incrementally repair these infrastructure systems because we cannot totally 

replace them in the existing NCC. To replace them, we would have to shut down 

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3Presently, we have only a single 30-hour window each year to perform all maintenance on 

the NCC. 

the building completely for an extended period of weeks or months.3 Such a shutdown would result in an unacceptably long interruption of service to the public. 

We also considered the possibility of renovating the existing building; however, 

renovations of this magnitude would require us to vacate the building and design 

and lease a facility to temporarily house the data and employees. The expense of 

doing this would be almost as costly as simply building a new, up-to-date data center and would create a risk of a major interruption in service. 

Even if we could overcome the obstacles to repair and upgrade the NCC and its 

infrastructure, we would still have a building designed around a 1970s’ mainframe 

environment. In the seventies, redundant electrical, heating, and cooling systems 

were not state-of-the-art requirements for data centers. In addition, fire suppression 

systems were not designed to cover an entire floor. 

In short, the current facility will not be able to meet the industry standards for 

data centers in the future. 

In February 2008, we received a report from Lockheed Martin, whom we had 

asked to independently analyze the condition of the NCC’s infrastructure and recommend ways to upgrade it, if necessary. The Lockheed Martin consultants identified no chronic structural defects and verified that over the years, we have maintained the building well. Lockheed Martin also confirmed the NCC’s structural limitations and recommended we build a new facility. 

The New Data Center 

We thank you for your support of funding to construct a new facility, which we 

are calling the National Support Center, and appreciate your acknowledging that 

in an environment of evolving cyberthreats, we must continue to protect beneficiary 

records with unmatched vigilance. 

I am pleased to report that the facility that will replace the NCC will not only 

be a state-of-the-art data center, but it will also incorporate green building technology. Compared to the existing facility, the new center will be substantially more 

energy efficient. 

We have started working with our colleagues at the General Services Administration (GSA) on all aspects of this project. GSA will manage the design and construction activities for the project, as only GSA has the authority to own or lease Federal 

facilities for us. However, we are working very closely with GSA in designing and 

constructing the new facility. We have a history of working very successfully on construction projects with GSA, both at the national and regional levels. For this 

project, GSA assigned some of its most highly qualified project managers, as have 

we, to ensure the work is completed on time without cost overruns and in full compliance with our requirements. We look forward to this important collaboration, and 

I would like to thank GSA for its vital support of this particular project, as well 

as our other building and space needs. 

We have started the formal planning process with GSA. Initial activities include: 

(1) formulating specific requirements for constructing a state-of-the-art data 

center; 

(2) developing the criteria for selecting a site; and 

(3) developing a detailed construction project plan. GSA will execute these 

steps, and we will provide input and oversight to ensure the facility’s design 

fully meets our needs and requirements. Additionally, GSA has awarded a 

contract to a construction management firm. The firm, Jacobs, will work 

with GSA and us to develop a detailed Program of Requirements, also 

known as a ‘‘scope of work.’’ We are currently providing Jacobs with necessary background information on the objectives of the project that it will 

use to define building requirements and land specifications. 

In addition to replacing the NCC, we have proactively addressed our increased 

data processing demands and enhanced our disaster recovery strategy by bringing 

up a Secondary Support Center. We have begun to install equipment at that site, 

and we are ahead of schedule for bringing up the facility. Within approximately 6 

months, we will be able to process about half of our production workloads at this 

facility, thus providing necessary backup to the NCC. The Secondary Support Center will eventually be able to provide full backup and recovery for our data and daily 

processing needs. 

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SUPPORTING ACCOUNTABILITY AND TRANSPARENCY FOR RECOVERY 

ACT RESOURCES 

We strongly support the accountability and transparency standards for Recovery 

Act resources established by Congress. To emphasize the importance of these standards, we are holding executives and staff accountable for monitoring and achieving 

the goals of all of the Recovery Act initiatives for which we are responsible. Because 

the Recovery Act invests in our core mission work, our existing internal controls will 

help us effectively account for our use of Recovery Act funding. However, we will 

also add any internal controls that we may need to assess our implementation of 

the Recovery Act. 

As recommended by the Office of Management and Budget (OMB), we are using 

existing entities to review, assess, and manage Recovery Act risk. We have designated our Executive Internal Control Committee (EIC) to serve as our Senior 

Management Council, overseeing Recovery Act performance across the agency, including risk management. The Deputy Commissioner of Social Security chairs the 

EIC, and the Inspector General and I serve on the committee. The EIC oversees the 

results of our internal controls that, among other things, test our financial reporting 

processes, systems development, and validation processes. The EIC also helps ensure our compliance with administrative, security, and management policies. 

As the Senior Accountable Official, I oversee all aspects of Recovery Act planning, 

implementation, reporting, and performance. I report progress, total obligations, and 

disbursements through a weekly update report, which we post to our website and 

submit to recovery.gov. As an indication of our readiness and ability to meet our 

responsibilities, we were one of the first agencies to place these reports on our 

website. We will be working with OMB to finalize our Recovery Act implementation 

plans by early May. 

We have formed intra-agency workgroups at both the executive and staff levels 

to manage the implementation of our three key Recovery Act responsibilities. These 

groups meet on an ongoing basis to ensure progress, resolve issues, and as needed, 

take corrective actions. 

Finally, we are working with the Office of the Inspector General (OIG) on seven 

of its audits that are directly related to the Recovery Act and four audits related 

to information technology processing. At this time, the Recovery Act audits focus on 

the adequacy of our planning processes. We understand that later OIG will perform 

additional audits on program results. 

ISSUING ECONOMIC RECOVERY PAYMENTS—AHEAD OF SCHEDULE 

Among the projects that we are monitoring very closely is, of course, the disbursement of economic recovery payments. The Recovery Act provides for immediate and 

direct assistance by issuing one-time $250 economic recovery payments to Social Security, Railroad Retirement, Veterans, and SSI recipients. We serve as the clearinghouse for the Railroad Retirement Board and Veterans Affairs to match the lists of 

eligible beneficiaries on our various systems to avoid duplicate payments. 

We have already notified beneficiaries that they need not take any action to receive their payments. We are also informing the public about the recovery payments 

through a recorded message on our national 800 number, a prominent link about 

these payments on our website (www.socialsecurity.gov), and an informational leaflet available at all field offices and Wal-Mart stores across the country. We also 

have knowledgeable employees in our field offices across the country ready to answer what we anticipate will be millions of questions about these payments. 

Our extensive planning with the Department of the Treasury, the Railroad Retirement Board, and the Department of Veterans Affairs will allow us to issue these 

payments to the more than 50 million eligible individuals during the month of 

May—3 to 6 weeks before the statutory deadline. We will automatically mail the 

payments to them or deposit the payments into their bank accounts. 

The Social Security and SSI Recovery Act payments will inject more than $13 billion into the economy, helping beneficiaries put extra meals on the table and pay 

increasingly high utility bills. We appreciate the support of Congress in our administration of the economic recovery payments. 

GOING FORWARD 

Thank you for the opportunity to describe the very real and tangible opportunities 

the Recovery Act provides to us to improve our service to the public, as well as assist in the Nation’s economic recovery. Despite the many challenges we face, Social 

Security is a can-do agency. We have made a commitment to the American public 

to work down our backlogs, and we will continue to do so. The Recovery Act provides 

us with resources to tackle the increase in the work we expect this year and to collaborate with GSA to build a new data center that will meet our future needs. With 

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the cooperation of colleagues at the Department of the Treasury, the Department 

of Veterans Affairs, and the Railroad Retirement Board, we have mapped out a plan 

to deliver $250 recovery payments to millions of Americans. 

For more than 70 years, we have served as a cornerstone of American economic 

security. We are proud of this role and see our Recovery Act responsibilities as a 

continuance of our mission. Going forward, we will maintain the highest level of 

oversight over all of our responsibilities funded in full or in part by Recovery Act 

resources. We will do our part to implement Recovery Act initiatives efficiently and 

effectively to help the American people as quickly as possible. However, the higher 

workloads the agency is experiencing require ongoing attention. We will need your 

continued support and timely action on the President’s FY 2010 budget in order to 

maintain our momentum and obtain the full benefit from Recovery Act funding for 

dealing with our workloads. We will keep this Subcommittee apprised of our 

progress and look forward to your continued support as we implement the plans I 

have described today. 

We appreciate the actions of Congress to provide assistance to the American people in this time of economic hardship, and we thank you for providing us with the 

resources we need to help in these efforts. 

f 

Chairman TANNER. Thank you very much, Ms. Glenn-Croft. 

With the permission of the panel, may we go ahead with all of 

the testimony before we go to questions? 

Mr. Hewell, you are recognized, sir. 

STATEMENT OF MR. ROBERT HEWELL, ACTING DEPUTY COMMISSIONER, PUBLIC BUILDINGS SERVICE, UNITED STATES 

GENERAL SERVICES ADMINISTRATION 

Mr. HEWELL. Thank you. Excuse me. Thank you, Chairman 

Tanner and Ranking Member Brady and Members of the Subcommittee. 

My name is Rob Hewell. I am the Acting Deputy Commissioner 

of the General Services Administration’s Public Buildings Service. 

Thank you for the opportunity to be here today to discuss GSA’s 

delivery of a new Social Security Administration National Support 

Center. 

As you know, as part of the Recovery Act of 2009, SSA received 

$500 million to replace their existing National Computer Center in 

Woodlawn, Maryland. SSA turned to GSA for help in locating, designing, and building a new data center to meet their long-term 

needs. Today, I will highlight our approach to this project. 

We are working closing with the SSA in defining their requirements for site, building infrastructure, and workspace. We are 

planning for a facility that will increase data, office, and warehouse 

space. It will meet Tier 3 standards established by the Uptime Institute, sustainable design goals, and the Interagency Security 

Council Level 4 security requirements. 

To deliver this new data center, we are using our design excellence and construction excellence program processes, time proven 

to provide outstanding cost-effective Federal facilities. We are also 

using a multiphased approach to concurrently develop criteria for 

both site acquisition and design. Concurrent development streamlines the processes and ensures consistency between site elements 

and design elements. 

In fiscal year 2008, prior to the enactment of the ARRA, we received funding from SSA to develop a program of requirements for 

the National Support Center. On April 1, GSA awarded a contract 

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to Jacobs Facilities to assist in all aspects of developing this 

project. In addition, Jacobs will conduct an energy optimization 

study to help us achieve our energy goals. 

Selecting a site for the National Support Center is of great importance to SSA, GSA, and local communities. We are committed 

to provide our customers with well-located, high quality sites. We 

will use established processes to research, evaluate, and select a 

site that can best serve the interests of the Federal Government, 

the end users, and the community. 

There are many factors associated with selecting and acquiring 

a site, and this kind of facility creates additional challenges. For 

example, the data center demands high-capacity utility services, as 

well as redundant power, communications, and other utility infrastructure services. Proximity to SSA headquarters in Woodlawn, 

Maryland, is also required to facilitate the transition to a new data 

center and for employee access in the event of a local or national 

emergency. These are all factors both GSA and SSA will use to 

identify the area of consideration. 

We intend to negotiate and award a contract for land acquisition 

in the second quarter of 2010, less than a year from now. 

Concurrent with site selection, we will be working with SSA and 

technical experts to develop SSA’s program of requirements for the 

data center. Once the site is acquired, we can begin developing the 

site’s specific design requirements associated with the solicitation 

for a design-build contract. We anticipate contract award for design 

and construction of the National Support Center in the second 

quarter of fiscal year 2011 with construction completed scheduled 

for October 2013. SSA will then begin their information technology 

migration. 

Projects of this size and scope present challenges, such as potential contractor protests, environmental impacts identified during 

the process of environmental studies and the changing nature of 

the fast-paced and ever-changing IT world. There are a number of 

steps we intend to take to minimize these risks, including establishing a detailed source selection plan for the design-build contract, screening possible sites for potential environmental impacts 

early in the process, and designing a flexible facility capable of accommodating expansion, mission-related changes, and advancements in technology. 

As leaders in sustainably designed buildings, we will build a facility that incorporates the Guiding Principles for Federal Leadership in High Performance and Sustainable Buildings. We will use 

industry experts in data center technology and energy experts from 

the Lawrence Berkeley National Laboratory. And we have staffed 

this project with our most seasoned technical experts and project 

managers. 

GSA is well prepared to meet SSA’s data center requirements on 

schedule, within budget, and with careful consideration to our responsibilities to the American taxpayers. We have a long partnership and an excellent working relationship with SSA, and we are 

eager to work with them and Members of this Subcommittee in the 

successful delivery of the National Support Center as part of this 

nation’s economic recovery. 

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Chairman Tanner, Ranking Member Brady, and Members of this 

Subcommittee, this concludes my statement. I will be pleased to 

support my colleagues from SSA in answering any questions you 

have. 

[The statement of Mr. Hewell follows:] 

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Chairman TANNER. Thank you very much, Mr. Hewell. We will 

probably have some questions about your timeline later on. 

Mr. O’Carroll, you are certainly recognized. Thank you, sir. 

STATEMENT OF MR. PATRICK P. O’CARROLL, JR., 

INSPECTOR GENERAL, SOCIAL SECURITY ADMINISTRATION 

Mr. O’CARROLL. Good afternoon, Mr. Chairman, Mr. Brady, 

and Members of the Subcommittee. 

I am pleased to be here today to discuss the initial work of the 

Social Security Administration’s Office of the Inspector General 

under the American Recovery and Reinvestment Act, and I thank 

you for inviting me. 

As you know, my office was provided with $2 million in funding 

for the oversight of programs, projects, and activities funded by the 

Act. 

The Act stresses the need for transparency in our oversight efforts, and we take this responsibility very seriously. As you can 

from our chart over there, our Internet home page already displays 

a prominent link to Recovery Act reporting as well as a means of 

reporting Recovery Act fraud. 

Under the Act, all inspector generals are charged with receiving 

and investigating whistleblower claims from employees of private 

firms and state and local Governments receiving recovery funds. 

My office has taken on a central role in this regard, coordinating 

the efforts of the entire inspector general community to ensure consistency in the application of the Act’s whistleblower provisions 

across the Federal Government. 

The OIG’s primary responsibility under the Act, however, remains the oversight of SSA’s expenditure of the $1,090,000,000 provided to the agency for three specific purposes: $500 million for the 

replacement of the National Computer Center, $90 million to be 

used to issue about $13 billion in one-time economic recovery payments of $250 each to beneficiaries, and $500 million for the processing of disability and retirement workloads. 

Our efforts in this oversight role are already well underway. In 

particular, the replacement of SSA’s National Computer Center is 

a critical matter for the American people. The NCC is the repository for the applications and data that support all of SSA’s functions, but it is at the very end of its lifespan. As early as 1997, we 

issued an audit with some 29 recommendations for the protection 

of the NCC, and, in 2004, we provided information on alternate facility options in the event of a catastrophic event at the NCC. SSA 

considered our comments in planning their second data center. 

We are now conducting a review of the plan, status, and data 

processing capacity of the second data center as well as a review 

of SSA’s plans to address its data processing needs 5 to 20 years 

into the future. These reviews stem in part from a recent OIG report that concluded that the agency needed to focus its efforts on 

detailed plans to acquire, construct, and operate a new data center; 

to estimate costs for the use or disposal of the NCC; and for IT requirements for the next 5, 10, and 20 years. Further, we urged SSA 

to identify the underlying factors that allowed the current NCC crisis to occur and implement controls to prevent it from reoccurring. 

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To round out our initial work in this area, we are in the process 

of acquiring a vendor to evaluate SSA’s process for selecting the replacement strategy for the NCC and to independently evaluate 

SSA’s efforts toward implementing that strategy. 

The $90 provided to SSA for issuing one-time recovery payments 

is also the subject of OIG oversight with two evaluations already 

underway. One will assess the agency’s controls and procedures for 

administering the one-time payments, and another will evaluate 

the processes put in place by SSA to identify and report costs incurred in the administration of these payments. 

The agency also received $500 million toward the processing of 

retirement and disability workloads. In a series of evaluations, we 

will examine SSA’s hiring, training, and placement of employees 

with the Recovery Act funds. Of the $500 million provided for processing disability and retirement workloads, $40 million was earmarked for health information technology. 

One of our planned evaluations will examine the use of $24 million which SSA plans to direct toward contract-based demonstration projects and pilot tests focused on electronic medical record retrieval. These efforts are only the first of many by SSA OIG to comply not only with the letter of the Recovery Act, but with its spirit 

of transparency, oversight, and accountability. 

I thank you again for the invitation to speak with you today, and 

I will be happy to answer any questions. 

[The statement of Mr. O’Carroll follows:] 

Statement of The Honorable Patrick O’Carroll, 

Inspector General, Social Security Administration 

Good afternoon, Mr. Chairman, Ranking Member Johnson, and Members of the 

Subcommittee. It’s a pleasure to be here today to present our initial efforts under 

the American Recovery and Reinvestment Act of 2009 (ARRA), as well as our future 

plans geared toward transparency and accountability. Thank you for the invitation 

to testify. 

The ARRA provided the Social Security Administration (SSA) with $1.09 billion, 

to be used as follows: 

• $500 million for necessary expenses for the replacement of the National Computer Center (NCC) and associated information technology costs. This funding 

is available until expended. 

• $90 million to be used to issue approximately $13 billion in one-time Social 

Security and Supplemental Security Income payments of $250 each. 

• $500 million for the processing of disability and retirement workloads, including information technology acquisition and research in support of such activities. 

The ARRA also provided the Office of the Inspector General (OIG) with $2 million 

for salaries and expenses necessary for the oversight and audit of programs, 

projects, and activities funded by the ARRA. This funding is available through September 30, 2012. 

While the majority of substantive SSA-related activities mandated by the ARRA 

are to be carried out by SSA itself, the OIG is bound by two types of requirements: 

those which the ARRA imposes on all Inspectors General, and those related to this 

OIG’s specific SSA-related oversight activities. 

To briefly address the former, the ARRA requires all Inspectors General to review, 

as appropriate, any concerns raised by the public about specific investments using 

Recovery Act funds. Any findings of such reviews, if not related to an ongoing criminal proceeding, must be relayed immediately to the head of the Agency; in this case, 

the Commissioner of Social Security. Additionally, the ultimate findings of such reviews, along with any audits conducted by any Inspector General of the use of Recovery Act funds, must be posted on the individual Inspector General’s website and 

hyperlinked to Recovery.gov. 

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To accomplish this, Inspectors General are authorized by the ARRA (in addition 

to their existing authorities) to examine any records of any contractor, subcontractor, grantee, or subgrantee, and to interview any officer or employee of any contractor, grantee, subgrantee, or agency, if the matter pertains to Recovery Act funds. 

Finally, the ARRA also places significant responsibilities on all Inspectors General, who will now play a central role in expanded whistleblower protections. Employees of private employers or State or local Governments that receive Recovery 

funds may not be retaliated against for making allegations concerning such funds 

to certain sources, including Inspectors General. Inspectors General have 180 days 

to investigate and make appropriate reports, and the whistleblower has, with certain exceptions, access to the investigative file during that time. 

The SSA OIG has taken on a key role in the Inspector General community in this 

regard, responding to a call from the Chair of the Council of Inspectors General for 

Integrity and Efficiency (CIGIE). In light of the increased responsibilities of the Inspector General community with respect to whistleblower allegations, it was felt 

that the community would be best served, and the ARRA best observed, by creating 

consistency and reliability across the community. As such, the SSA OIG has taken 

on the task of developing this cross-cutting issue on behalf of the community, beginning with a survey and study of approaches, interpretations, and best practices. 

The CIGIE has also formed a working group to support the Recovery Accountability and Transparency Board in its statutory function, and my office is a participant and proponent of that group. 

The Office of Management and Budget has issued implementing guidance on the 

ARRA, and the SSA OIG is compliant with that guidance—we are fully prepared 

to receive and investigate all ARRA-related whistleblower claims. The SSA OIG’s 

website is not only compliant with ARRA requirements, but goes a step beyond— 

our internet home page, www.socialsecurity.gov/oig, already displays a prominent 

link to our Recovery Act reporting, as well as a means of reporting Recovery Act 

fraud. 

The SSA OIG’s specific responsibilities, however, rest in its oversight of the Agency’s use of Recovery Act funds for the purposes enumerated in the Act: the replacement of the NCC, the processing of retirement and disability workloads, and the 

issuance of one-time stimulus payments. My office has already completed work in 

these areas, has additional audits underway, and has still more audits planned. 

Replacement of the NCC 

The NCC is the repository for the applications and data that support all of SSA’s 

functions, as well as other Government functions that rely on SSA data. It was constructed in 1979 and, with current trends, it is estimated that the NCC will reach 

its maximum data capacity within three to five years. In addition, the NCC’s infrastructure, including heating, ventilation, and air conditioning, as well as its electrical components, are at the end of their useful lives. Failure of any large component of the uninterruptible power supply (UPS) cannot be repaired, and the UPS 

manufacturer will discontinue maintenance of the outdated model at the end of 

2015. 

As early as 1997, only two years into the OIG’s existence, we issued an audit entitled Review of Physical Security at the Social Security Administration’s National 

Computer Center. In that audit, we made some 29 recommendations for the protection of the NCC, most of which SSA agreed with. In 2004, the OIG issued a memorandum, SSA’s Alternate Facility Options for the NCC, in which we provided information on alternate facility options in the event of a catastrophic event—such as a 

terrorist attack—at the NCC. SSA considered our comments in its planning of the 

Second Data Center, also referred to as the Second Support Center. 

In 2008, Lockheed Martin completed an NCC Feasibility Study of the facility that 

identified infrastructure and data processing capacity issues that pose a significant 

risk to SSA’s continuity of operations. That study recommended that SSA undertake 

17 projects to sustain existing information technology operations through Calendar 

Year 2014. 

Under the ARRA, we recently issued a report entitled Quick Response Evaluation: 

The Social Security Administration’s Ability to Address Future Processing Requirements. In this limited distribution report, we sought to assess SSA’s efforts to address 

future processing needs and infrastructure issues at the NCC. Specifically, we assessed SSA’s actions in addressing the significant issues identified in the Lockheed 

Martin study. We noted the importance of ensuring the continued operation of the 

NCC. SSA estimates that it would cost the taxpayers $25 million for each day that 

the NCC was not operational. Moreover, during such outages, the Agency would be 

unable to process tens of thousands of retirement, survivors, and disability claims, 

as well as Social Security number verifications. This type of service interruption 

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would likely hamper people’s ability to obtain employment, driver’s licenses, even 

loans and mortgages. 

We found that SSA had already taken or planned some corrective action on 13 

of the 17 recommended projects. (Lockheed Martin had recommended that 3 of the 

17 be deferred due to changes in the NCC’s functional role.) Lockheed Martin concluded that there were four options for resolving the Agency’s long-term data processing needs: a new, on-campus data center; a new, off-campus data center; lease 

of an existing off-campus data center; or renovation of the existing NCC. 

SSA is progressing on both immediate and long-term solutions. However, until the 

significant issues identified by Lockheed Martin are fully addressed, and a longterm data center solution is implemented, the Agency’s operations remain vulnerable. 

In our report, we concluded that, going forward, the Agency needs to focus its efforts on detailed plans: 

1. to acquire, construct, and operate a new Data Center; 

2. to estimate costs for the use and/or disposal of the NCC should a new primary Data Center be built; and 

3. for IT requirements for the next 5, 10, and 20 years. 

Further, we urged SSA to identify the underlying factors that allowed the current 

NCC crisis to occur, and implement the necessary controls to prevent it from reoccurring. 

In another ARRA project focused on the NCC, we are in the process of acquiring 

a vendor with the necessary highly technical skill sets to evaluate SSA’s process for 

selecting the replacement strategy for the NCC, and to independently evaluate 

SSA’s efforts toward implementing that strategy. While a contract award of this 

type would normally take almost 180 days from the date that funding was made 

available, SSA’s Office of Acquisition and Grants has expedited the process on our 

behalf. We anticipate that the contract will be awarded mid-June—approximately 

90 days from the date that OMB apportioned the funds to us. 

On February 19, the OIG began an ongoing study, Congressional Response Report: 

The Social Security Administration’s Information Technology Strategic Planning. In 

that report, we will review SSA’s plan to address its data processing requirements 

5 to 20 years into the future, and examine what actions SSA has taken to meet those 

requirements. 

Another ongoing audit, The Social Security Administration’s Second Data Center, 

is reviewing the plan, status, and data processing capacity of SSA’s Second Data 

Center. SSA’s Information Technology Operations Assurance (ITOA) initiative is designed to mitigate the risks of having a single point of failure associated with having 

a single, national computing facility. The ITOA project seeks to alleviate these risks 

by establishing a second, fully functional, co-processing data center. 

This Second Data Center will be designed to process a portion of SSA’s workloads, 

and this new center and SSA’s main data center will back up each other, so that 

in the event of a catastrophe, operations can continue. SSA estimates that the Second Data Center will be fully functional in 2013; we will recommend that they accelerate that process to bring the Second Data Center fully online by 2010. I recently 

toured both the NCC and the Second Data Center, and while I was struck by the 

condition of the NCC, I was impressed in equal measure by the state-of-the-art facility at the new location, and the foresight evident in its planning and execution. This 

contrast between the NCC and the Second Data Center only highlights the importance of accelerating the completion of the new Center. 

As SSA continues to plan and implement changes to ensure its continued data 

processing operations, the OIG will undertake additional audits and reviews to assess and evaluate the Agency’s progress. 

One-Time Economic Recovery Payments 

We’ve undertaken two evaluations associated with the distribution of approximately $13 billion to Social Security and Supplemental Security Income (SSI) beneficiaries in the form of $250 individual payments. The ARRA provides SSA with $90 

million to ensure these payments can be made efficiently and accurately. 

Our first evaluation, Quick Response Evaluation: Economic Recovery Payments for 

Social Security and SSI Beneficiaries, is assessing the Agency’s controls and procedures for administering the ARRA-mandated payments. Under the ARRA, individuals who receive Social Security or SSI benefits, as well as either Railroad Retirement Board or Veterans’ Affairs benefits, will receive only one $250 payment. Our 

review will determine whether SSA has adequate controls in place for the accurate 

distribution of ARRA funds. 

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Our second review, Quick Response Evaluation: Administrative Expenses Incurred 

to Provide Economic Recovery Payments, will evaluate the processes put in place by 

SSA to identify and report costs incurred in the administration of the one-time ARRA 

payments. 

Retirement and Disability Workload Processing 

The ARRA also provided SSA with $500 million to process retirement and disability workloads, of which $40 million may be set aside for Health Information 

Technology development. The OIG is already at work overseeing the use of these 

ARRA funds. 

A series of reports already underway will evaluate hiring practices. One of these 

reports, Quick Response Evaluation: ODAR Hiring Under the Recovery Act, began 

earlier this month, and will examine SSA’s Office of Disability Adjudication and Review staffing plans associated with ARRA funds. Similar reports have also been initiated to examine hiring strategies for State Disability Determination Services, and 

for SSA’s Office of Operations, which includes all SSA field offices. 

Another planned evaluation, Quick Response Evaluation: Funding for Health Information Technology, will evaluate SSA’s plans for the $40 million earmarked for 

this purpose. In March of this year, SSA informed us that it will invest the $40 million as follows: 

• $16 million in direct support of IT needs to reduce the backlogs, including 

video conference equipment for hearings and workstations; and 

• $24 million specifically for Health Information Technology, including contracts for ‘‘proof of concept’’ demonstration projects and pilot tests focused on 

electronic medical record retrieval. 

Our audit will focus on the planned use of the $24 million designated specifically 

for Health Information Technology, whereas the $16 million will be reviewed as part 

of a separate audit that is already underway. 

These completed, ongoing, and planned efforts are only the first of many by the 

SSA OIG to comply not only with the letter of the ARRA, but with its spirit of transparency, oversight, and accountability. We will continue to report to the Subcommittee, post the results of our work on our own website and on Recovery.gov, 

and ensure that the funding provided both to SSA and to the OIG is spent well and 

wisely. 

I thank you again for the invitation to speak with you today, and I’d be happy 

to answer any questions. 

f 

Chairman TANNER. Thank you very much. 

Ms. Melvin, you have the floor. 

STATEMENT OF MS. VALERIE C. MELVIN, DIRECTOR OF INFORMATION MANAGEMENT AND HUMAN CAPITAL ISSUES, 

UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE 

Ms. MELVIN. Thank you, Chairman Tanner, Ranking Member 

Brady, and Members of the Subcommittee. 

I am pleased to be here today to comment on SSA’s use of resources provided by the American Recovery and Reinvestment Act 

to replace its National Computer Center. While GAO has not reviewed the agency’s plans for this initiative, by all indications, it 

represents a significant undertaking, and its success will depend on 

how effectively it is carried out from inception through completion. 

As our work has noted, investments in information technology 

can improve organizational performance, but, if not well planned 

and managed, they can become costly and unproductive, yielding 

disappointing results. Our research into IT management best practices and our reviews of agency performance have identified essential management disciplines that agencies can use to help ensure 

that investments achieve their potential benefits. For all IT investments, including SSA’s new data center initiative, it is important 

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to follow effective practices in key management areas. At your request, I will summarize several of these areas. 

First, effective strategic planning helps an agency set priorities 

and decide how best to coordinate activities to achieve its goals. In 

this regard, an agency should describe its goals, the strategies it 

will use to achieve them, and performance measures that allow it 

to determine how well it is doing. 

For example, when a strategic plan identifies interdependencies 

among project activities, the agency is better able to understand 

and manage them so that projects and their results are effectively 

integrated. Given the new data center is to form the backbone of 

SSA’s automated operations, it is important that the agency identify goals and resources and dependencies in the context of its strategic vision. 

Further, an agency’s enterprise architecture is important to help 

avoid developing operations and systems that are ineffective in 

supporting mission goals. It is a blueprint for organizational 

change describing how an organization operates now, how it intends to operate in the future, and how it plans to transition from 

present to future. Thus, it should be closely aligned with the IT 

strategic plan. An enterprise architecture can help ensure that 

those planning and implementing SSA’s data center take full account of the business and technology environment in which the 

center and its systems are to operate. 

Also, an agency should follow a portfolio-based approach in which 

investments are selected, controlled, and monitored from an agency-wide perspective. Such an approach helps ensure that resources 

are allocated effectively. Thus, robust investment management 

processes can help agencies like SSA meet the accountability requirements of the Recovery Act and align with its goal. 

Projects funded under the Act are to avoid unnecessary delays 

and cost overruns and achieve specific program outcomes. Investment management is aimed at precisely such goals. As one important aspect, accurate cost estimates provide a sound basis for establishing a baseline so that agencies can effectively formulate 

budgets and measure program performance. 

Finally, information security is essential to any organization that 

depends on information systems and networks to carry out its mission. This is especially true for Government agencies like SSA 

where maintaining the public’s trust is essential. As such, security 

should be considered throughout the planning, development, and 

implementation of the data center. 

A vital part of information security management is contingency 

and continuity of operations planning. Data centers are vulnerable 

to a variety of service disruptions, including accidental file deletions, network failures, and disasters. Accordingly, defining plans 

that govern how information will be processed, retrieved, and protected in the event of minor interruptions or a full-blown disaster 

is essential. 

Thus, overall, these capabilities will be important in helping SSA 

ensure that it accomplishes its objectives consistent with Recovery 

Act requirements. With a solid grasp of its current IT environment, 

a clear vision of what capabilities a new data center is to provide, 

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and an informed and sound approach to getting there, SSA will be 

better positioned for success. 

Mr. Chairman, this completes my prepared statement. I would be 

pleased to respond to any questions that you or other Members of 

the Subcommittee may have. 

[The statement of Ms. Melvin follows:] 

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f 

Chairman TANNER. Thank you very much. 

Mr. Schieber, thank you for being here today. You are recognized, sir. 

STATEMENT OF MR. SYLVESTER J. SCHIEBER, CHAIRMAN, 

SOCIAL SECURITY ADVISORY BOARD 

Mr. SCHIEBER. Thank you, Chairman Tanner, Mr. Brady, 

Members of the Subcommittee. I am pleased to have this opportunity to appear before you on behalf of the Social Security Advisory Board. 

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Over its history, the agency has been a diligent steward of the 

public’s trust, overseeing the programs that so many individuals 

and families depend on. Because of chronic underfunding and the 

ever-increasing growth in new claims applications, SSA’s ability to 

fulfill its mission has been under constant pressure in recent years. 

Today, the economic downturn is creating a dramatic spike in 

workloads, and just down the road, the baby boomers will be in 

their peak disability-prone years just ahead of their retirement applications. The infusion of resources provided by the Recovery Act 

should allow SSA to meet current backlogs and to manage increased workloads going forward. It should help in addressing the 

data system and processing issues under consideration today. 

Recent workload pressures have been compounded because the 

agency has not widely undertaken business process reviews and reengineering common in other business and Government settings, 

has relied too long, in our opinion, on outmoded technology that 

has reached its processing capacity. The agency has recently begun 

to move to address these problems, but the bounds of what these 

new process and planning tools can do are narrow without a robust 

and flexible IT foundation. 

In the intermediate term, Social Security’s data processing operations are at serious risk because of inadequate backup capabilities 

if some sort of breakdown should beset the National Computing 

Center at Baltimore headquarters. This problem is being addressed 

with the construction of a second data center in North Carolina. 

Backup capability between the two sites is scheduled to be fully 

operational in 2013, and the agency executives are working to accelerate that schedule because of the problems with the National 

Computer Center. 

In the meantime, the agency’s disaster recovery plans are of 

grave concern. Today, we are talking about the critical need to replace SSA’s National Computer Center. Its capacity is inadequate 

to meet future processing needs and assure the security of data. 

We have been told that in just three more years, by 2012, the NCC 

will not be able to meet Social Security’s workloads. We have also 

been told that, in the best-case scenario, it will take 4 or 5 years 

to plan, develop, and build a new data center and another 2 to 3 

years to complete its setup and integration. In short, the new NCC 

will not be fully operational until 2016, possibly 4 years too late. 

Frankly, this is a bit like a slow-motion wreck playing out in front 

of our eyes that might be entertaining if it were not such an important matter. 

Through the services it provides, the Social Security Administration touches the lives of nearly 60 million beneficiaries every month 

and gathers earning data on some 145 million workers necessary 

to run the program. The backlogs that have pestered the disability 

insurance program in recent years are going to look like a cakewalk compared to the issues that you will be getting constituent 

calls about if the SSA computer systems break down. 

I do not think the timelines we have heard on building and 

bringing a new computer center online are acceptable. In my prepared remarks, I tell how the Pentagon went from first concept to 

occupation in 18 months at the beginning of World War II. The 

building was completed in 18 months from the time it was initially 

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conceived. It was done on an extraordinary schedule because of the 

importance of our responding to a daunting challenge that we were 

facing. 

I am convinced that the American public believes that where 

there is a will, there is a way to get things done in a timely fashion, even by our modern-day Government. If we were able to take 

a building as complex and large as the Pentagon from nothing to 

occupancy in 18 months, we should be able to build and furnish a 

new Social Security computer center in something less than 5 to 8 

years when the current one will be inadequate for the task in half 

that time. The urgency of our response in this case has to match 

the urgency of the task before us. 

Rather than guess as to how this situation arose, it is more productive to consider how to ensure that the problem does not happen again. The Board has come to question the governance of the 

agency’s IT investments. The current process is decentralized, and 

IT oversight is split among a number of senior executives. Originally intended to ensure transparency and foster shared responsibility, the result has diluted ownership and management of the 

overall IT process. We believe that there needs to be a realignment 

of responsibility and accountability and a new governance structure 

established. 

Finally, I would offer that without a map the road ahead is not 

always clear. In recent years, SSA’s strategic plans have often reflected narrow, short-term goals that address immediate issues. 

They are tactical plans. They are not strategic plans. Perhaps a 

longer planning horizon that was broader in scope would have 

identified earlier the need to replace the NCC. We continue to urge 

Social Security to focus on longer range service delivery needs and 

develop the infrastructure that will carry them well into the 21st 

century. 

Mr. Chairman, I hope these comments are helpful, and I will be 

happy to answer any questions you might have. 

[The statement of Mr. Schieber follows:] 

Statement of Sylvester J. Schieber, Chairman, 

Social Security Advisory Board 

Chairman Tanner, Mr. Johnson, Members of the Subcommittee. I am pleased to 

have this opportunity to appear on behalf of the Social Security Advisory Board to 

present the Board’s view on the progress made by the Social Security Administration in implementing the American Recovery and Reinvestment Act of 2009 (ARRA). 

The investment that the Congress has made in the Social Security Administration 

will ensure that the agency is able to fulfill its vital role in helping American families 

when they need it most. 

Through the services it provides, the Social Security Administration (SSA) touches 

the lives of nearly 60 million beneficiaries, 145 million workers and nearly every 

American. One out of every six individuals receives monthly cash benefits from Social Security or Supplemental Security Income (SSI), the major programs that SSA 

administers. This fact alone should be an indicator of the importance of continuous, 

smooth operations of this agency. 

The role of Social Security in our society is not only pervasive; it is an extremely 

important economic lifeline for millions of vulnerable citizens. The beneficiaries and 

recipients of Social Security’s monthly check include aged individuals and persons 

with disabilities, their spouses, other dependents, and survivors. In fiscal year 2008, 

41.2 million people were receiving retirement and survivor benefits and another 15.1 

million were receiving disability benefits. SSA processed nearly 4.1 million retirement and survivor claims, 2.3 million initial disability claims, and 559,000 disability 

hearings during that same fiscal year. The agency provided services to the public 

in general by processing over 19 million requests for new or replacement Social Sewwoods2 on DSKGBLS3C1PROD with HEARING

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curity cards, posting 273 million earnings items to individual earnings records, answering 63 million calls to its 800-number and handling over 42 million visitors to 

local field offices. 

Over the past 74 years, the agency has been a diligent steward of the public’s 

trust, overseeing the benefit programs that so many individuals and families depend 

on. In recent years, however, SSA’s ability to fulfill its mission has been severely 

strained. Chronic underfunding despite growing workloads exacerbated the situation. The expansion of electronic disability case processing coupled with the need to 

request and store millions of images of electronic medical records has sorely tested 

the agency’s processing and storage capacity. Moreover, they have continued, far too 

long in our opinion, to operate with outmoded information technology and database 

structures that could not support new and more efficient business rules and processes. 

Last April I had the opportunity to testify before the Committee on Ways and 

Means. The issue under discussion was whether SSA had the resources to substantially reduce the growing disability claims backlog. At that time over 756,000 people 

were waiting nearly 500 days for disability decisions from administrative law 

judges. The increased productivity in the hearings offices this year has aided the 

growing momentum in reducing the backlog. These backlogs were-and still arealarming in their own right, but become even more so when they are juxtaposed 

with the anticipated rise in claims over the next 10 years. SSA’s workload will increase dramatically. Retirement claims will jump by over 40 percent and disability 

claims will rise by nearly 10 percent. The 2008 OASDI Trustees Report estimated 

that by 2015 there will be 50 million retirees, widows and widowers, and dependents receiving benefits and they will be expecting efficient and modern service from 

the Social Security Administration. 

But the anticipated growth in claims does not stop there. The baby boomers are 

entering their disability prone years and the number of initial disability claims is 

projected to rise steadily from the 2.5 million claims received in 2008. A year ago 

SSA’s actuaries estimated in Fiscal Year 2009 SSA could expect to receive over 2.6 

million new disability claims. 

The economic downturn that became apparent at the end of last year is having 

a significant impact on SSA’s workloads in the current year and is expected to continue to affect workloads over the next couple of years. DDSs have already received 

over 11 percent more claims this year than at this same point in time last year. 

Over 664,000 new initial claims are pending in the DDS. This is over 100,000 more 

than they had at the start of the fiscal year in October 2008. It is highly likely that 

SSA will receive approximately 2.9 million disability claims this year: 300,000 more 

than anticipated. About 75 percent of those who are denied benefits at the DDS 

level eventually find their way to the hearings level and this will lead to another 

50,000 claims in the hearings backlog. All of this puts immense stress on the agency’s ability to provide timely, accurate, and efficient service. 

SSA’s Approach to Managing the Increased Workload 

SSA has experienced extraordinary spikes in its workload before and has always 

stepped up to meet the challenge. These prior surges in workload were, for the most 

part, fairly well defined and eventually leveled off. But this time it is different. Now 

there are burgeoning workloads that are not likely to decline for several years. Significant numbers of experienced staff are leaving through retirement and the agency’s ability to replace them has been uncertain. The additional funding provided by 

an increased FY 2009 appropriation and the American Recovery and Reinvestment 

Act has allowed SSA to hire a significant number of new staff to fill the critical vacancies in the field offices, DDSs, and hearings offices. While this new staff will not 

bring relief in the short run, they are essential for the agency’s future. 

Business Process Modeling and Performance Management 

Throughout the Board’s existence, we have spent the vast majority of our time 

studying the disability program and how well it serves the public. In our 1999 report on how SSA can improve service to the public, we noted that more sophisticated performance management tools were needed. This is an agency that collects 

a wealth of data on case characteristics, decisional outcomes, timeliness, productivity, quality, and cost. The data are tallied and put into charts and called ‘‘management information.’’ 

We have commented in the past that the Office of Disability Adjudication and Review’s (ODAR) Case Processing Management System (CPMS) technology makes it 

possible to create and retrieve information and yet historically there has been little 

innovative analysis occurring. The only way to understand and improve performance 

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is by identifying and targeting the root cause of bottlenecks and vulnerable processes and then implementing measures that track outcomes. 

The Board was recently briefed on several new initiatives underway in ODAR and 

it appears to us that there is a growing emphasis on data analysis and process management. They have developed an electronic business process model that simulates 

how work currently is processed, and for the first time, will be able to systematically 

identify steps in the process that create bottlenecks or do not add value to the process. While this initiative is very new and still in the validation stage, it does hold 

promise for improving workload management throughout the hearings process. 

We have been assured by senior management that the modeling capabilities being 

developed to help identify problems in the hearings process will be able to isolate 

variance in performance from office-to-office and determine the root cause for that 

variance. If this approach proves effective, through process modeling, ODAR will be 

able to plan proactively for changes in receipts and how to redistribute workload, 

anticipate the need for changes in staffing mix, and determine what legitimately can 

be mitigated by improved management practices. The current use is focused on assuring the success of the agency’s plan to reduce the backlog and going forward it 

will give them the capability to manage proactively, not just reactively. It is a new 

direction for ODAR and we are encouraged by this initiative. 

Overall workload management can be dramatically improved through sophisticated forecasting and modeling tools. SSAB continues to urge the agency to use its 

research capacity more broadly and tap those resources in order to take a more systematic long range look at growth in workload, where it is happening and the underlying causes, and then develop simulation models that demonstrate the effects 

of different variables on all parts of the adjudication process. ODAR is in the early 

stages of analyzing the characteristics of the hearings population and this will better inform the agency leadership about managing cases at that level; but we believe 

that there is much that SSA can learn about the characteristics of potential filers 

at the initial claim level as well. 

Current State of Data Center Operations 

SSA’s main computer operations center, the National Computer Center or NCC, 

is a thirty year old facility located on SSA’s main campus in Baltimore. While originally designed to house the agency’s large mainframe processing units and associated peripheral equipment, the NCC has been retooled and modernized over the 

years in an attempt to keep pace with SSA’s ever-growing computer needs. But 

growing workloads, expanding telecommunications, storage requirements for huge 

volumes of electronic images, the electronic disability folder process, and ever tighter security measures have pushed the NCC’s capacity to the limit. We were recently 

told that the storage capacity at the NCC has been expanded from 12 terabytes in 

2000 to 483 terabytes in 2009 and the agency is estimating that storage requirements could increase by four times that amount in the next five years. 

Coupled with these processing capacity issues, we learned in late 2008 that the 

NCC also has significant structural problems. Electrical supplies into the building 

are rapidly becoming inadequate; the backup power supplies are so old that it is 

virtually impossible to get replacement parts; and the fire suppression system needs 

upgrading. In addition, the General Services Administration (GSA) has advised the 

agency that in order to keep the NCC functioning, SSA would have to significantly 

increase the number of times it shuts down the data center on an annual basis to 

do routine maintenance, potentially curtailing the agency’s ongoing operations to a 

considerable degree. To identify options for shoring up the NCC operation the agency consulted with external experts and learned that by the end of 2012 the NCC 

would no longer be viable and replacing it could not wait until the second data center was fully up and running. 

We have been told by agency executives that, in the best case scenario, a new 

NCC will take 4 to 5 years to plan, develop, and build; another 2 to 3 years would 

be needed to complete all systems set-up and integration activities. The agency has 

estimated that the replacement facility would be fully operational by January 2016; 

however, given the typically long lead time to build and outfit such a governmental 

facility, there is some risk that it could take longer to complete. In fact, we recently 

learned that the process for acquiring the land may not be complete until March 

2010. The $500 million the agency received in the economic stimulus package for 

the NCC is a sizeable and necessary investment and speaks to the urgency of this 

project. Making this project a reality is the shared responsibility of SSA and the 

General Services Administration. In our view, pursuing this building project in a 

‘‘business as usual’’ process is unacceptable and I would guess that much of the 

American public would find the timelines I have outlined here laughable if they 

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1Summary derived from http://pentagon.afis.osd.mil/history.html as read at 3:10 p.m., 23 

April 2009. 

were not so appalling. Due diligence is essential, but areas where red tape can be 

cut or timeframes shortened should be pursued. 

You might wonder why I would suggest that many in the American public would 

find taking five years or more to build a new computer center and another two to 

three years to get the operating equipment in place as laughable. I do not believe 

that most people would consider the five-to-eight-year time frame involved would reflect the urgency this project deserves given the national dependence on this agency. 

I do not believe that most people would accept that we could not do this on a more 

timely basis if we were truly committed to the task. 

By way of contrast, I would like to offer a little lesson from history. Early in 

World War II, the Government was pressed for office space for the growing military 

effort associated with our joining the war. On Thursday July 17, 1941, Brigadier 

General Brehon B. Somervell summoned two of his subordinates and told them that 

by the following Monday morning he wanted basic plans and an architectural perspective for an air-conditioned office building to house 40,000 workers in four million square feet of space, not more than four stories high and with no elevators. 

After what Lt. Col. Hugh Casey called a busy weekend, he and his staff completed 

the basic layout of a five-sided building by the following Monday. The building’s 

basic concept was approved that Monday by General Somervell and by the Secretary 

of War the next day who then informed President Roosevelt of his plans. At the 

same time President Roosevelt was being briefed, General Somervell was presenting 

the plan to Congress. Congress and the President moved quickly to approve the supplemental appropriation bill to fund the project. Construction commenced on Sept. 

11, 1941. One section was completed by the end of April 1942 and the first tenants 

moved in. The basic shell and roof were finished in one year, and the building was 

completed by Jan. 15, 1943.1 Since then, we have known that building just across 

the Potomac River as the Pentagon which today still is the central administration 

facility for the U.S. Defense Department. 

I believe that the American public believes that where there is a will, there is 

a way to get things done in a timely fashion even by our Government. If we were 

able to take a building as complex and large as the Pentagon from nothing to complete in 18 months while we were in the middle of one of the most daunting military 

conflicts in world history, then assuming we cannot do something better than five 

to eight years in building a new Social Security computer center is, well, laughable. 

Second Data Center and Plans for Disaster Recovery 

In researching our recent report on SSA’s information technology infrastructure, 

we learned that the agency began planning a second data center more than five 

years ago as part of a new strategy for comprehensive data backup and recovery. 

In response to September 11, 2001, the Department of Homeland Security issued 

a directive in 2003 requiring all Federal agencies to develop plans that identify, 

prioritize and protect critical infrastructure. At that time, SSA had not updated its 

disaster recovery plans in over ten years and, therefore, had not taken into account 

the impact of the electronic disability processing system or the disability electronic 

folder. Agency executive recognized that their contingency plans were not nearly 

sufficient. In the event of a disaster, plans called for the use of private backup and 

recovery facilities at an offsite commercial hot site. However, the arrangements only 

allow for the recovery of 25 to 30 percent of the agency’s production capability and 

recovery would take seven to nine days. In addition, SSA would have to queue up 

with other businesses or governmental agencies for access to the facility. This is, 

in fact, the disaster recovery plan still in effect today; the plan that will remain in 

effect until the two data center strategy is fully operational. 

The vision for a second data center is that it would function in tandem with the 

primary NCC as ‘‘a fully functional, co-processing facility.’’ The plans call for about 

50 percent of the work currently processed in the NCC to be transferred to the second center. Functionally, the two facilities would ‘‘mirror’’ each other and provide 

backup capability. In the event of a disaster, the second center would have the capacity to process virtually all of SSA’s priority workloads almost immediately. The 

new site would also have sufficient space available so that additional equipment and 

staff could be brought in to handle 100 percent of the agency’s computing needs in 

the event the NCC was non-operational. SSA took occupancy of the new facility in 

Durham, North Carolina in January 2009. Over the next 12 months, the agency will 

be installing the data processing and storage infrastructure. Backup capability between the NCC and the second center is scheduled to be operational by the end of 

the second year with full functionality in place by 2013. However, in discussions 

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with the agency’s executives, we have learned that they are trying to accelerate the 

schedule because of the problems with the NCC. 

Continued Risk 

Where does all this leave the agency in terms of operational capacity and its ability to backup data and recover operations as the transition between data centers 

takes place? Sometime within the next two years the second data center should 

have sufficient capacity to process some workloads on an ongoing basis as well as 

provide additional backup and recovery for other critical workloads. This will certainly improve the situation for a period of time. However, by late 2012 when the 

NCC is at the end of its projected life-cycle, the second data center will most likely 

need to serve as the agency’s primary computing center with disaster recovery once 

again reliant on commercial hot sites. To date, we are unaware of any efforts the 

agency has taken to actively pursue alternative recovery scenarios such as contracting for the use of other governmental or commercial hot sites in the event the 

NCC becomes non-operational. 

The National Research Council referred to the data stored by SSA as the ‘‘crown 

jewels.’’ The current two data center strategy affords some assurance that the data 

are secure and recoverable. The agency recently appointed a highly talented Future 

Systems Technical Advisory Panel to advise them on emerging technologies and infrastructure needs. We suggest that this panel be enlisted to perform a quick analysis of the situation and provide recommendations to the Commissioner within 30 

days. 

In the interim, over the next seven years until the new NCC and the second data 

center are fully operational, there is a risk that at some point benefit checks could 

be significantly delayed or not delivered and important data could be lost. Given the 

economic role that Social Security plays in the lives of a large segment of the American population, I find this situation deeply disturbing. 

How did SSA get in this situation? 

As I mentioned previously, the Board has just finished a two-year study that focused on how SSA’s public service can be improved through technology. During that 

time we met with several agency executives on a host of issues, including systems 

development, strategic planning, infrastructure needs, and resource allocation. Discussions relative to the NCC revolved around its limited capacity to meet future 

workload demands and how the second data center in Durham would fulfill the need 

to expand processing and backup capacity. In fact, the Board first learned of the 

critical nature of the NCC’s physical plant from the Commissioner in the fall of 2008 

and I believe he informed the Board virtually immediately upon becoming aware of 

the problems himself. 

I can only hazard a guess as to why this issue has only come before our 

viewfinder in the last several months and I doubt that my guessing about root 

causes would add much of value. Instead, I believe that it will be more productive 

to ensure that this potential for great risk to SSA’s infrastructure does not happen 

again. The Board strongly urges SSA to undertake a self-assessment that would 

identify the underlying factors that allowed the current NCC situation to occur. 

While this particular story is about the development and maintenance of systems 

operations at Social Security, the root of the problems associated with it are about 

the role of senior career managers in the agency, their sense of fiduciary responsibility in their roles and how they handle these roles when the agency leadership 

is not open to the messages being delivered. 

SSA needs to develop a governance structure of shared ownership and accountability that is committed to diligently identifying and managing all risk factors and 

strengthening its strategic and tactical planning processes. 

Governance of the Information Technology (IT) Investments 

Given the recent developments with regard to the National Computer Center, 

there is clearly reason to question the governance of the agency’s IT investments. 

With different planning and oversight of the IT process, perhaps the critical situation the agency finds itself in could have been avoided. As the Board looked at the 

IT planning and management process at SSA, there is evidence that the current 

process could be more effective. 

Governance of IT investments at the agency is a decentralized process. While the 

Chief Information Officer (CIO) and the Deputy Commissioner for Systems (DCS) 

are the principle players, IT oversight is split among a number of senior executives. 

The CIO has responsibility for such functions as IT capital planning and investment 

management, overall enterprise architecture, strategic planning for IT, and e-Government initiatives. The DCS has responsibility for systems acquisition, development, and integration. All of these disparate functions are supposed to be brought 

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together and managed under the auspices of the Information Technology Advisory 

Board (ITAB). The ITAB has the overall responsibility for shaping the agency’s IT 

strategy and for approving and allocating resources for the hundreds of projects that 

are proposed each year. While originally designed as a way to ensure transparency 

and foster shared responsibility for IT investment, the result has been more of a 

dilution of ownership and management of the agency’s overall IT process. 

During our research, we talked with a number of organizations, both public and 

private, and found some major differences in the way IT governance is handled. For 

most of these organizations, the responsibility for governance is a centralized process with ultimate accountability invested with the CIO. The CIO is responsible for 

comprehensive planning, development, and implementation of new IT projects as 

well as for the ongoing maintenance of current systems. It is the CIO’s responsibility to ensure IT investments are aligned with the organization’s strategic plan 

and that they are properly evaluated to measure their success or failure. I believe 

that this is the type of oversight that the Congress intended when it passed the 

1996 Clinger-Cohen Act. This Act requires agencies to designate a CIO to help control risk, better manage technology spending, and achieve real, measurable improvements in agency performance through the use of technology. 

The Board has recommended that the agency restructure its governance process 

and that it centralize overall responsibility for all IT processes. I believe that the 

current structure has left the agency open to the type of risk we are talking about 

here. While some may argue that capital planning and the management of the overall enterprise architecture are separate and distinct functions from the more tactical 

responsibilities for systems acquisition, development and implementation, this bifurcated process, for whatever reason, simply has not worked at SSA. The agency’s 

ability to deliver public service will increasingly depend on technology and governance of the IT process must have strong leadership who is empowered to make critical decisions and is held accountable for those decisions. 

Further, the more theoretical process of assessing emerging technologies and new 

IT-related strategies has for too long been divorced from the practical development 

of processing systems. The result has been that an agency once considered a pioneer 

in systems automation is now struggling to provide service with an outdated technology infrastructure. The recently appointed Future Systems Technical Advisory 

Panel will be instrumental in helping the agency create a system for the future. 

However, I believe it will take strong leadership to ensure that the agency breaks 

out of its insular view of technology and embraces what it can bring to the delivery 

of quality public service. 

Strategic Planning 

SSA’s original endeavors in strategic planning described a comprehensive and ambitious vision for the future of the agency. While high-level in nature, these early 

plans described in broad terms the necessary steps that would be needed to carry 

out that vision. In recent years SSA’s strategic plans have been primarily narrowly 

focused shorter range tactical plans designed to address a more immediate issue. 

While it is only conjecture, it is possible that the failure of SSA to anticipate and 

adequately plan for a replacement national computer center when the current building came to the end of its lifecycle is partly the result of inadequate enterprise-wide 

long-range planning. The more immediate need to support the agency’s computing 

capacity with a second data center may have overshadowed the need to develop a 

longer-range plan for replacing and transitioning out of the current NCC facility. 

The Board believes SSA needs to return to longer-range planning that envisions 

how the agency will deliver service and what the supporting infrastructure must be 

to make this plan a reality. We urge SSA to begin the planning process for the next 

decade and develop a ‘‘to be’’ 2020 vision. The process must include a broad scan 

of environmental factors that will arise within the next decade, a thorough assessment of future technologies, a comprehensive review of all major business processes, 

and in-depth analyses of service delivery channels and opportunities for change or 

improvement. Short-term planning and implementation strategies are not sufficient 

for the type of technological changes SSA will need to make if it is to meet future 

challenges. 

The Advisory for this hearing rightly noted that Congress has made a significant 

investment in SSA’s capacity to continue to effectively serve the American public. 

We firmly believe that your confidence has not been misplaced and that this investment will yield significant dividends. In our role as an Advisory Board that serves 

the President, the Congress, and the Social Security Administration, we are committed to ensuring SSA’s ability to fulfill its mission. 

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Mr. Chairman, I hope these comments are helpful to the Subcommittee. I would 

be happy to provide any additional assistance you may want, and I would be happy 

to answer any questions you may have. 

f 

Chairman TANNER. Thank you very much, Mr. Schieber. 

And I want to thank all of you all for your time and for your expertise, for your devotion to duty, and for being here today with respect to this. Actually, a critical part of America’s dependence on 

its social safety net as represented here today, and we wanted to 

take time to look and see where we are with respect to the recovery 

funds that have been made available to accomplish a purpose that 

we all foresee. 

I guess, Ms. Glenn-Croft, Mr. Hewell, is there a way, without, of 

course, sacrificing quality or any sort of capability, to speed this 

process up some because if you have a glitch and we have a life 

expectancy out there at the computer center of 2013. If we do not 

have something to take its place, as Mr. Schieber said, we have a 

monumental problem here. 

Ms. GLENN-CROFT. Well, I certainly appreciate that question, 

and I certainly expected you to ask that question, Chairman. 

Let me provide a little bit of background here. In addition to 

being responsible for Recovery Act funds for Social Security, I am 

also the deputy commissioner for budget, finance, and management. So facilities are part of my responsibility. 

I have been in this role now a little over a year, and, obviously, 

I have looked at this very question that you raised, and this is a 

little bit of context here. The NCC is headed toward its 30th birthday. We have taken good care of that building. We have maintained it at high levels of high standards, but, as you know, the infrastructure in that building is getting old. 

I would like to say, though, that we are very confident that we 

are going to be able to keep that building operational until the 

point in time that we finish the new data center and we actually 

transition from the NCC to the new data center, and I certainly 

can provide either verbal comments on or information for the 

record as to how we believe that we can do that. But we are very 

confident that we can keep that building going well past the 2012 

date that you have heard, okay. 

What I would also like to tell you, as part of this good news 

story—and I know the commissioner mentioned this when he was 

here at the hearing last month—is that we have moved into the 

Durham site, and we are moving rapidly with that Durham site, 

and part of the situation that we are very happy to tell you about 

is that probably by late calendar year or early 2010, we will have 

enough equipment, hardware, and software in the Durham site 

that should the NCC have a catastrophic event occur, which, obviously, we hope will not happen, but should that occur, we will be 

able to use that site to bring up our critical production workloads, 

okay. That is a new situation that I am not sure that the committee is aware of. 

The reason I go through these two points about being able to 

keep the NCC operational and the enhanced capacity that we will 

have in Durham is that that does take off some of the pressure and 

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the timeframes that you were talking about in terms of getting the 

new data site up and operational. 

Obviously, we will work with GSA. We will do everything that 

we can to get the new data center up and operating as quickly as 

possible. We are going to do that to keep us moving forward on 

time and within costs, but this is a very difficult build. There is a 

lot of logistics. This is not like building an office building. This is 

a huge project. We have to do it right. We have to do it to avoid 

protests and disputes. 

There is a lot of environmental factors and issues and studies 

that have to occur, and working with GSA, we will do everything 

we can to get that building done as rapidly as possible, but, again, 

while this is happening, we believe we can keep the NCC going, 

and we will have much more capability and backup potential in 

Durham as that build occurs. 

Chairman TANNER. Thank you. 

Mr. Hewell, do you have anything to add to that with respect 

to—that addressed partially my question. My question is: Is there 

any way to accelerate this schedule without sacrificing competency 

or capability of the installation? 

Mr. HEWELL. Yes, Mr. Chairman. We think there may be. 

We have compared our schedule to what we are told are normal 

private-industry schedules for similar facilities, and it is pretty 

much right in line with that. What some private-sector companies 

have done to get data centers done more quickly is double or even 

double and a half the timing of work schedules and things like 

that, by going to what is called—this was a new term to me—a 6/ 

20 week. Excuse me. We will certainly be looking at that. 

We also think right now that probably the most promising area 

that we could achieve some savings in is the period between site 

purchase and award of the design-build contract by doing as much 

of the development of the requirements for the facility at the same 

time that we are acquiring the site. If that goes well, we may be 

able to cut as much as 6 months off of the year in between those 

two. 

So we are looking at ways to make the schedule shorter. 

Chairman TANNER. Well, I do not know why that could not 

happen. I get a little nervous when I realize the steps to the House 

side of the Capitol took longer to replace than it did to build a new 

football stadium out in Maryland. So you get a little nervous about 

these timeframes if you are looking at them. 

Mr. O’Carroll, we appreciate what you do because, as stewards 

of the money, we are trying to get money into the economy quickly, 

but, in doing so, we do not want to sacrifice anything with respect 

to transparency, oversight, auditing, and so on. Do you have any 

comments about speeding up and what your office might encounter 

were that to be done? 

Mr. O’CARROLL. Yes, Mr. Chairman. One of the things that we 

are looking at now is hiring a vendor that is technically competent 

and knows the state of the art in terms of being able to evaluate 

the plans, be able to take a look at the location, the timelines, et 

cetera, on it, to make sure that, you know, all the i’s are dotted and 

t’s are crossed in relation to this. 

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And another one that—you know, although you did not ask, but 

just to say one of our concerns on this thing is that we were very 

encouraged by the 2010 with the secondary site being able to take 

on some of the redundancy of a lot of the operations that are going 

on, but, again, our biggest concern is up until 2010 where we are 

still using an offsite vendor in a different state and competing with 

other entities, you know, recoup in, you know, a catastrophic instance, you know, at the NCC. 

So we are watching very carefully that, and we are going to, you 

know, be encouraging everyone to go as fast as they can, but being 

as cautious along the way. 

Chairman TANNER. We want to avoid haste makes waste if we 

can, and I know you all do as well. 

Did either of you have a comment? Mr. Schieber. 

Mr. SCHIEBER. Redundancy is redundancy. What we are facing 

if we have a catastrophe may be still a precarious situation. We 

first discovered or were told about the problems with the National 

Computer Center in November. The commissioner came and met 

with us, and that was the first time it was brought to our attention. 

We immediately became concerned and started asking questions 

about bringing the North Carolina facility online and were given 

timelines and capacity loads that it would be able to carry. I believe right now the recovery provisions supposedly will allow them 

to recover their critical production workloads in a period of a week, 

so they would be back up on what they call their critical production 

work. But that is only about 30 percent of their operating capacity. 

If they did that, at that juncture, they would have no Internet, they 

would have no intranet, they would have probably no phone system. 

So I think we need to make sure when we say that we are going 

to cover certain things, we understand what that means, and it is 

not that they are not working hard at trying to get this. In some 

regards, my sense is that, for senior management, this has been as 

much a surprise to them as it has been to us. 

So I think there is an urgency here that we all need to keep our 

eyes on, and we need to make sure exactly what bases we are covering when we say we can cover certain bases. 

Ms. MELVIN. I would add, speaking from the standpoint of not 

having reviewed exactly what they are doing, but recognizing the 

urgency of what they are doing, I think it is also important to advocate for caution from the standpoint of them proceeding in a disciplined approach so it is kind of moving quickly, but, at the same, 

making sure that they have plans that really identify what it is 

that they need to put in place, that they have a strategy identified 

for doing that, and that they have a means of measuring their 

progress and their performance along the way. 

Again, it goes back to a point I made in my oral statement earlier about the—just many times money is invested in projects, but 

if you do not have a disciplined approach to managing that, you 

can still waste that, even in the sight of urgency and even recognizing the importance of what you are trying to do. 

Chairman TANNER. Mr. Brady. 

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Mr. BRADY. Well, thank you, Chairman. I share your concerns. 

I would take Ms. Glenn-Croft up on her offer to outline for the committee some of the things that can be done to extend the life of the 

current computer center, and I do urge you, Mr. Hewell, and others 

to find ways to accelerate this. So rarely do things stay on budget 

and on time, but we could have a major gap for capacity in Social 

Security, and that is a concern to both parties on this Committee. 

Two questions really—well, Ms. Glenn-Croft, obviously, Social 

Security is receiving $1 billion in stimulus, some to pay for the 

computer center, others to deal with the new workload and to improve service delivery. What real benefits will our taxpayers see as 

far as, you know, will they wait less long to get their disability reviews and appeals heard? Will they spend less time waiting in the 

Social Security office or getting a busy signal when they call SSA 

for services? When will we see—when is a fair timetable to see improvements in service delivery as a result of the extra money? 

Ms. GLENN-CROFT. As you know, we are expecting 300,000 additional retirement claims this year and 300,000 additional initial 

disability claims this year as well as 50,000 additional hearings. 

We are very pleased and thankful for the Recovery Act funding 

that we received, and upon receipt of that money, we immediately—immediately—very aggressively started hiring. We expect 

with Recovery Act funding to hire over 2,000 people. As of today, 

coming in to this hearing, we have already in 1 month hired 1,400. 

Before we received the Recovery Act funding, we had already 

started going out and doing recruitment efforts, broad-based recruitment efforts, so that we would be ready to go if we did get the 

funding. And, again, we are thankful for that. So we are bringing 

in quite a number of new people into our front-line components, 

our field offices, our teleservice centers, our hearing offices. 

When you bring new folks in, you do not see immediate productivity from new staff. Our programs, as you know, are very complex. Training lasts anywhere from 10 to 15 weeks, and when they 

come out, then we put them under a mentoring program. 

Mr. BRADY. Sure. That is exactly right. You cannot change 

things overnight, and those additional resources will help. But that 

was my question. Where is the fair timetable where we will see improvement? 

Ms. GLENN-CROFT. Well, I was just going to get to that. That 

was just a little bit of context. We expect that we will really see 

productivity from our new hires starting in fiscal year 2010. 

Mr. BRADY. What kind of measurements can you produce for 

the Committee as we go forward so we can measure those wait 

times, the quality of service? 

Ms. GLENN-CROFT. We have a number of performance measures that we have included in our Recovery Act plans that we have 

submitted in draft to the Office of Management and Budget, and 

we have included performance measures, such as the number of retirement claims we will process, the number of initial disability 

claims processed, hearings processed. We will also obviously have 

processing time data. So we will be able to provide you with performance measures along those lines. 

Mr. BRADY. Okay. Great. 

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If I may, I think every Member of this Subcommittee is on here 

because we want to see Social Security preserved for every generation, and Social Security is not immune to the economic downturn. 

We have some charts, I think, that in the March update, CBO now 

projects Social Security surpluses will be very low over the next 4 

years, as low as $3 billion in 2010, which is very nearly breakeven. 

There you can see the dramatic change just in a year as a result 

of the recession. That is almost breakeven next year there. It disappears by 2017. 

CBO has lowered its Social Security surplus projections pretty 

dramatically over the past year, and what that chart does not show 

is the disability program is already experiencing cash flow deficits. 

CBO projects that the insurance trust fund balance will reach zero 

in 2019, and, under current law, program revenues will be unable 

to pay the full benefit schedule. 

For years, the Social Security board of trustees has warned of the 

financing challenges we face in Social Security. I think there is a 

general belief the sooner we act to protect and strengthen Social 

Security, the better. A 2009 annual Trustees’ Report is expected as 

soon as next week, and I am hopeful Chairman Tanner will schedule a hearing of the Subcommittee to closely examine the report. 

So my question to you, Mr. Schieber—and then to Ms. GlennCroft is knowing the bipartisan advisory group has done so much 

on this issue, is it better that we act sooner rather than later on 

this issue? 

And then to Ms. Glenn-Croft, are you sharing your expertise with 

the administration about what these challenges are and how we 

move forward on that? 

Mr. Schieber. 

Mr. SCHIEBER. The Board over the years of my tenure on it has 

issued three separate reports. We like the title we put on the first 

one so much, we have used the title on all three reports saying that 

action sooner rather than later is preferable. We probably should 

have issued a repeat of that report under my tenure as chairman, 

but, once you have said something three times, saying it a fourth 

sometimes does not seem maybe so valuable. Maybe it is. My wife 

oftentimes tells me twice is enough to hear me say something. 

So we also have issued a couple of other reports. One we titled 

‘‘The Unfolding of a Predictable Surprise’’ about the general state 

of our retirement system. This was before the recent collapse in the 

financial markets. And in the last couple of months, we have issued 

a report on the value of encouraging people to work longer. These 

all have ramifications for the financing of Social Security. 

At this juncture, I guess I would say that it is extremely important. This program is a vital foundation of retirement security for 

the overwhelming majority of Americans. Even people at middle-income levels rely to some substantial extent on Social Security, and 

having this program defined not only in a way that they understand what the benefits are going to be is extremely important to 

them, but there is another side as well. We have to have a program 

that our children and their children can afford. 

I have done some work recently that suggests if we continue to 

allow health costs to increase the way they have over my working 

career and we let Social Security costs go up the way the Social Sewwoods2 on DSKGBLS3C1PROD with HEARING

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curity actuaries project they will under current law if we try to deliver current law benefits and people try to save on their own that, 

for the middle-income worker and down, any additional disposable 

income that they may earn because of increased productivity is 

going to be eaten up by what they are paying for their own health 

insurance, for Medicare and Medicaid to provide to the elderly, and 

for retirement benefits. 

Now do we want this to be the end of growing prosperity from 

generation to generation in America? And I am not talking about 

something in 2042 or 2050. I am talking about my son and his wife 

who are 30 years old, trying to start a family, trying to buy a 

house. They may have reached the pinnacle of their standard of living if we let this play out. 

It is time we look at these programs on a serious basis, including 

how we are going to control health costs, and start a conversation 

with the American people about how we are going to address these 

issues. It is of critical importance, and it is of critical importance 

to at least three-fourths of the American population. The people 

who are well-off, I assume, will continue to do fairly well, but many 

of the rest are going to struggle if we do not address these problems, and we ought to do it now. 

Mr. BRADY. I thank you. 

And I am over my time, so the chairman can decide if Ms. GlennCroft gets to answer or not, but I do think—we all may have different ideas on how we strengthen it, that is fair, but I think every 

Member on this Subcommittee thinks sooner rather than later 

would be helpful, as difficult as it can get. 

Mr. SCHIEBER. If you want the board to begin exploration here, 

you know, a request of some sort would be helpful. Our Members— 

we are political appointees also, and we are reluctant to weigh very 

much further into these issues on our own without some sense that 

maybe somebody has something that we could help with. We have 

spoken out. I would be willing—my tenure as Chair is going to be 

relatively short here. I would be willing to try and get the board 

started in a discussion if it would be helpful to the committee and 

to moving this discussion along. 

Mr. BRADY. Thank you, Chairman. 

Chairman TANNER. Thank you, Mr. Brady. 

Thank you, Mr. Schieber. We will be back in touch with you on 

that point. 

Ms. Schwartz, you are recognized. 

Ms. SCHWARTZ. Thank you, Mr. Chairman, and I appreciate 

some of your comments, and, of course, as you well know, the 

broader issue of health care and health care reform is one that is 

very much on the agenda of this President, and should we be successful in voting the budget this afternoon and in the Senate this 

week, we will certainly have it on the agenda. 

So, more broadly speaking, it is not unrelated because, of course, 

if we do a better job of containing costs in both the public and the 

private sector that will help and help Americans be healthier, 

maybe you would have fewer claims for disability. Wouldn’t that be 

a good thing? The goal is to have Americans be healthier. 

But what I wanted to ask was a bit about the health care, particularly the disability, and one of the aspects of the extra money 

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that was provided to Social Security Administration was for health 

information technology, and there have been some comments about 

the difficulties of information technology, but I understand that 

using some demonstration projects that have been quite successful—the idea was—as we are again more broadly in the health care 

sector, certainly under Medicare—different jurisdiction, Ways and 

Means, but nonetheless jurisdiction. 

We have invested quite a bit in health information technology as 

a way to improve quality and monitor what we are doing, but I understand that these demonstration programs have been very successful having—I will just be clear. I understand it to be able to 

have your staff be able to review claims and get medical records 

online. And that one of those difficulties in time delays in processing the claims is the many calls back and forth for medical 

records that can be quite dispersed. And getting all that information, getting it accurately, getting it in a timely way is dramatically 

changed, I understand, to the point of seconds rather than days, 

that that information can be available to the reviewer. 

So my question really is severalfold. One is: Can you tell me— 

I think I am directing this maybe most appropriately toward Ms. 

Glenn-Croft. I think you would be the one to answer it. Ms. Melvin, 

if you have some add-on, you can as well. But what I want to know 

is how far does that $40 million that we have provided from recovery funds to be able to move the electronic medical records and the 

ability to get this information in a timely fashion—given what you 

just said about how long it takes to train personnel, 8 to 10 

months, which is somewhat staggering, you said it is—that is what 

you said. You started training them, but until they are fully operational, it is 8 to 10 months. That may be a different question 

someone else wants to ask about whether we could speed that up. 

But they are training in the use of the information technology, 

medical records. How quickly can we see a shortening of the number of days? That is one of the major complaints we certainly hear 

from people who have applied, think they are eligible, you think 

they are eligible, but you do not have all the documentation, and 

it literally takes months and months and months for them to be approved, and these are people who are in critical situations sometimes certainly. So these are not people who have months and 

months necessarily to wait. 

So can you speak to how quickly, how broadly this is going to impact the literally tens of thousands, hundreds of thousands claimants that we hear from all the time and how much this will help 

move that forward? 

Ms. GLENN-CROFT. Health information technology really is a 

thing of beauty for this agency. We have been a leader in this area. 

As you know, we have done several pilots, one in Boston and one 

now in Virginia, and just to add some context, we process new— 

request medical evidence or health records about 15 million times 

a year from about 900,000 sources, so making movement forward 

with HIT is absolutely critical to us in terms of adjudicating cases 

on a much more timely basis because now it takes us, oftentimes, 

weeks to get records when we get them in hard copies through 

them mail, okay. 

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What we are going to do with money received under the Recovery Act is we are going to use $24 million of the Recovery Act money. 

The commissioner has just identified a new executive to lead this 

effort, is getting high visibility in the agency. In the July timeframe, we are going to go out and solicit for interest. We will be 

picking on—we will be contracting with a limited number of medical sources as a proof of concept, pilot-type scenario, so that we 

can get it more experience in requesting medical evidence from 

them electronically and then having them send it back to us electronically. Every hospital and every doctor’s office has its own type 

of automation—— 

Ms. SCHWARTZ. Right. 

Ms. GLENN-CROFT [continuing]. How they keep their records, 

the format of their records, how they code their records, and we 

need to get experience, broader experience, on how we can share 

that information electronically, watch the format the medical evidence and information should be in, how coding should work, and 

we are going to experience. 

Again, we will solicit for offers in the July timeframe. We believe 

we will start to let the contracts probably in the December timeframe. 

Ms. SCHWARTZ. Two questions on that—of course, you are well 

aware that in the ultimate Recovery and Reinvestment Act, we did 

put in quite a bit of dollars for HHS, and one of the—— 

Ms. GLENN-CROFT. Yes. 

Ms. SCHWARTZ [continuing]. The responsibilities for HHS going 

forward is to establish Federal guidelines for interoperable secure 

medical records that should help in the sense of what kind of formatting you will see—— 

Ms. GLENN-CROFT. That is correct. And we need that. 

Ms. SCHWARTZ [continuing]. Different hospitals and doctors, 

but how—so what are you going to do with the rest of the money? 

That is $40 million. You are putting out $24 million. Ms. GLENN-CROFT. We could spend up to $40 million. We have 

chosen at this point in time to spend $24 million. The remainder 

of that $40 million—we are spending $16 million of it, the balance 

of that $40 million, to buy supplies—not supplies, but equipment, 

computers, those types of—— 

Ms. SCHWARTZ. So you can receive the information. 

Ms. GLENN-CROFT. Yes. And that equipment will be used, obviously, to review the electronic medical records. We will also use 

some of that money just to provide systems support on the Social 

Security end so that we can work with the hospitals to modify their 

systems so that we can talk to each other. 

Ms. SCHWARTZ. Do you have any idea yet how many claims 

that will affect and how many people it will affect? 

Ms. GLENN-CROFT. No, I do not. At this point in time, I cannot 

give you that scope. I certainly can go back and check that out and 

provide it for the record if we have it. But, no, I do not know that. 

Ms. SCHWARTZ. I think it would be helpful, particularly—Mr. 

O’Carroll might want to know what your plans are, what you expect to be able to accomplish, how many people you expect to—the 

timeframe—— 

Ms. GLENN-CROFT. Again, this is—— 

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Ms. SCHWARTZ [continuing]. What your goals are so that at 

least you can measure your own success against them. 

Ms. GLENN-CROFT. Yes. And we will be doing that, but, again, 

this is a proof of concept. It is so that we can learn what we need 

to do, what needs to be changed. There will be a lot of lessons 

learned that will come out of this, but, obviously, we will have 

measures to measure our success as we go forward. 

Ms. SCHWARTZ. Again, I think all of us would say, you know, 

move in a way that actually does not have you moving too fast and 

you are doing the wrong thing, to learn from the initial experiences, but we also have a sense that this is something that done 

right, done well, do not take too long if it actually could, in fact, 

change literally the lives of so many of the people who are applicants. 

Ms. GLENN-CROFT. We are moving aggressively on this, and I 

have to tell you, from the standpoint of an employee who receives 

evidence via this method, it is very exciting when you can process 

a claim in a matter of hours versus a matter of months. 

Ms. SCHWARTZ. I think we would all appreciate it quite personally as well as, of course, the people we represent. 

Thank you, Mr. Chairman. I yield back. 

Chairman TANNER. In keeping with who was here when the 

gavel went down, we have Mr. Becerra and then Ms. Brown-Waite. 

Mr. Becerra, you are recognized. 

Mr. BECERRA. Thank you, Mr. Chairman. 

And thank you all for your testimony today. 

I would like to begin by asking both the Social Security Administration and the GSA if they have a high level of confidence that 

they will adhere to their current timeline for completing the replacement of the National Computing Center project. 

Actually, Ms. Glenn-Croft, why don’t you go first in terms of 

whether SSA has a high degree of confidence that—my understanding is by 2014, you expect to complete the building and, within another 18 months, equip and migrate data and processing from 

the existing building. 

Ms. GLENN-CROFT. I have a very high degree of confidence 

that we will do this. There is a strong partnership with GSA. SSA 

has put their strongest technicians on this project. We have an executive that is—— 

Mr. BECERRA. That is good. Good. 

Ms. GLENN-CROFT. And I believe that GSA would say the 

same. 

Mr. BECERRA. Okay. 

Mr. HEWELL. Yes? Okay. 

And you are prepared to notify this Committee and any other 

oversight bodies if you fall behind in that process? 

Ms. GLENN-CROFT. Yes, we will. As a matter of fact, we will 

be providing monthly reports to this Committee on our progress 

with all aspects of the Recovery Act funding. 

Mr. BECERRA. Can I ask, Ms. Glenn-Croft, why was it that SSA 

waited so long to tell us of the urgent need to replace the existing 

NCC building in the first place? 

Ms. GLENN-CROFT. Well, what happened—— 

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Mr. BECERRA. And just a brief answer. I do not want to get in 

too much detail. 

Ms. GLENN-CROFT. All right. Well, basically, what happened 

is, in the 2005–2006 timeframe—and, again, this is based upon my 

going back and looking at the situation when I came into this 

role—the way we did business at Social Security dramatically 

changed. We became basically an electronic business process agency. We moved from paper to electronics. Our disability process is 

totally electronic now, and, as a result of that, our need for servers 

to store electronic data dramatically changed, and—— 

Mr. BECERRA. Okay. So you became aware of the fact that now 

with this new electronic world you actually would need to have a 

better facility and—— 

Ms. GLENN-CROFT. Well, what really pushed it over the edge, 

sir, was the fact that with the need for servers in this ever-changing technological world, servers now come with two plugs versus 

one plug because of the need for redundancy. Previously, for the 

years past, they came with one plug. You get a server, you plug it 

into the wall. Now, when you get a server, you have to plug it with 

two plugs. 

And what happened is—I know this seems simplistic, but what 

we realized is we were running out of electrical distribution capacity. Basically, we are adding 25 servers a month, and we realized 

that with that increased server capacity that by 2012, 2013, we 

were going to run out of ability to plug servers in, and when that 

happened, we realized that we needed to go to look at what our options were for the NCC, and that is when we went out and we got 

a neutral vendor, Lockheed Martin, to come in—— 

Mr. BECERRA. Let me ask—— 

Ms. GLENN-CROFT [continuing]. And do a study. 

Mr. BECERRA. Let me ask a couple other questions. And I appreciate your response there. And I know the chairman has asked 

if there is any chance to accelerate the completion because of the 

concern that if there are any delays, it could jeopardize a lot of that 

data and what we do with the data, if, indeed, you slip on the 

deadline. So I hope that you are able to give some response, if you 

believe and GSA believes that there is any chance to accelerate the 

completion. 

I also hope that you will give us some additional information on 

what you are doing to work with the Office of Management and 

Budget to try to get the additional moneys. I understand you need 

about another quarter of a million dollars to complete the project, 

and what you are doing to try to make sure you get the money both 

in the President’s budget and, obviously, finally from the Congress 

to make sure you do not fall behind. Because the last thing we 

need is to find that you fall behind because of money concerns, and 

we or White House or the OMB are responsible for delaying SSA. 

I think too many of us have seen what happens when SSA does not 

get the money it needs, and ultimately our constituents, our beneficiaries are the ones that pay the price. So I hope you will keep 

us abreast of that. 

Can I also finally ask—I am concerned—and, Mr. O’Carroll, 

maybe I should ask this of you. Why would we allow an agency to 

cannibalize its resources that are meant for IT at a time when we 

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have just heard that we are shifting over so much toward a world 

of IT to try to deal with the millions—I should say billions—of bits 

of information that are needed to transact all the affairs of people 

who paid into a system to now be able to get their disability benefits or their retirement benefits? 

Doesn’t it seem disconcerting that—and I know part of the problem is Congress and OMB, that we have not given them money? 

But how can we enable SSA to ask for the money it needs to gear 

itself up to deal with this technology and information requirements? 

Mr. O’CARROLL. Well, let me go backward first, I guess it would 

be, on the reason things have happened the way they have in 

terms of, you know, the robbing Peter to pay Paul with the agency 

on it. I have to say—and it is partially our issue as the inspector 

general on it, is that we were more interested in terms of continuity of operations and making sure that the new processes that 

were being put in place for the disability programs and different 

things like that. 

We were spending most of our time looking at that and not really 

looking at the building and looking at, you know, the structures 

that were, you know, falling into disrepair, and I have to tell you 

this. You know, I even go to my employees that walk down the hall 

every day past, you know, wires sticking out of walls and stuff and 

say, ‘‘Why didn’t somebody tell us that this place is falling apart?’’ 

So, on that regard, you have my assurance that we are looking 

very hard on at least the hardware side of things and the building 

of it, and one of the answers before that you were asking on is 

monitoring SSA. We are going to start—we are taking a look at 

their plans for the future. We are looking at how their funding is 

being done. 

We are going to come out with a report in June on sort of an 

overview of what will be going forward on it, to make sure that the 

funds are coming from the right places, it is not taking it from the 

other programs. And then we are also going to be planning on 

doing quarterly reports just to update what is near the Committee 

and any of the other oversight entities, in terms of where the SSA 

is going with it and whether they are staying on their time with 

their one—so I guess the best I can assure you is it is kind of, you 

know, as the agency has said, is we are all kind of, you know, looking very hard at this thing and making sure that the right resources will be, you know, put to use. 

Mr. BECERRA. Thank you. 

Thank you, Mr. Chairman. 

Chairman TANNER. Thank you. 

Mr. Yarmuth, you are recognized for—— 

Mr. YARMUTH. Thank you, Mr. Chairman. 

I just want to get some clarification on some of the funding that 

is going to be spent from the Recovery Act out of the $500 million 

for processing of claims. Ms Schwartz talked about the $40 million 

for IT. Is the other $460 million dedicated primarily to salaries of 

the employees, or could you break that down for us, how you intend 

to use that? 

Ms. GLENN-CROFT. Yes, I can. The remaining portion of that 

$500 million will be primarily spent for salaries and benefits for 

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employees that we are hiring, the new employees that we are hiring, for the remainder of this year and over next year, and it will 

also allow us to provide significant amounts of overtime to our 

frontline components so that they can process critical workloads, 

better handle the 800 number calls that are coming in, and handle 

visitors to the field offices. So that is basically how the remainder 

of that money, really the bulk of that money, is being spent. 

Mr. YARMUTH. Okay. So that is for essentially 2,000 new employees over the 2-year period, however much it is—— 

Ms. GLENN-CROFT. Basically, the remaining 6 months of this 

fiscal year and then all of next fiscal year. 

Mr. YARMUTH. So 2 months plus overtime? That is—— 

Ms. GLENN-CROFT. Yes, that is correct. 

Mr. YARMUTH. That is all I wanted to ask, Mr. Chairman. I 

yield back. Thank you. 

Chairman TANNER. Thank you, Mr. Yarmuth. 

Ms. Brown-Waite. 

Ms. BROWN-WAITE. Thank you. Thank you very much, Mr. 

Chairman. 

Commissioner Glenn-Croft, in your testimony, you stated that 

there are going to be about 10 additional field hearing offices, and 

I know when Commissioner Astrue was in Florida, he stated that 

there were going to be two additional ones in Florida. Other than 

in the near future, as in your testimony, do you have an estimate 

of when you anticipate that these offices will be up and running, 

even the two in Florida, and what are the obstacles if there is 

going to be a delay? What obstacles do we need to overcome? 

Ms. GLENN-CROFT. Well, the two new—there are 13 new hearing offices that are planned. I believe the commissioner mentioned 

that when he was here a month ago, and I think he may have mentioned it to you when he was recently with you on a Florida visit. 

Ms. BROWN-WAITE. He did. 

Ms. GLENN-CROFT. And the two new hearing offices in Florida, 

I believe, are going to be in Tallahassee and St. Petersburg. I believe? Is that correct? 

Ms. BROWN-WAITE. I believe that is accurate. 

Ms. GLENN-CROFT. Those are the two locations. We have facilities staff that are working very hard, working with GSA, the counterparts of GSA, in Region 4, and we are very comfortable that 

those sites will be up sometime—and I can give you exact dates, 

but I know it is sometime during fiscal year 2010 that those sites 

will be up. We are working with GSA to expedite getting those 

sites and building those sites out. 

We have a great need for those sites in those 13 locations across 

the country, so we are doing everything that we can to eliminate 

any roadblocks and make sure that they are up and operational 

and staffed as quickly as feasible. Usually, it is a, you know, 18- 

month process, roughly. I am looking at my GSA colleague for him 

to shake his head on that. You know, 18 months or so is usually 

the time for the entire process, but I can give you more specific 

dates for the record. 

Ms. BROWN-WAITE. If you could back to the chairman—— 

Ms. GLENN-CROFT. I will be glad to do that. 

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Ms. BROWN-WAITE [continuing]. With the dates, not just for 

Florida, for all of the—— 

Ms. GLENN-CROFT. I certainly can do that for you—— 

Ms. BROWN-WAITE [continuing]. Anticipated offices. 

Ms. GLENN-CROFT [continuing]. For all 13. 

Ms. BROWN-WAITE. I apologize. I thought you said 10. 

Ms. GLENN-CROFT. The commissioner did say 10 originally, 

and he has recently added three additional. So now the number is 

13. 

Ms. BROWN-WAITE. Oh, okay. Okay. 

Now the other question that I have—and I asked staff this a moment ago—I got a call from a constituent this past weekend who 

never hesitates to call me at home because my number is listed, 

and she was upset that she got a mailing from Social Security telling her that she was going to receive a $250 check as a result of 

the recovery plan, and she said, ‘‘I do not need that money.’’ Now 

my first instinct was, ‘‘Send it to me’’ or ‘‘Donate it to a wonderful 

charity’’ in my district.’’ 

She asked me two questions. One was, ‘‘How much did that mailing cost?’’ And, second of all, ‘‘Did the agency really believe it was 

necessary with all of the information that was out there? ‘‘ If she 

did want to send that check back, her comment was, ‘‘I do not want 

it just to go to the General Treasury where it is going to be blanked 

away.’’ She wanted it to go directly into Social Security. If that 

check is sent back to Social Security, does it go directly into Social 

Security? 

Ms. GLENN-CROFT. All right. You asked two questions, and let 

me take them one at a time. 

Ms. BROWN-WAITE. Okay. 

Ms. GLENN-CROFT. In terms of sending the $250 check back, 

I just heard this week that that was a question that had arisen. 

I am sure—and multiple times that we had gotten that question, 

and we are in the process of trying to figure out policy-wise what 

we will do if someone walks into a field office and wants to return 

that check. 

Since this is an administrative payment, if they return the $250, 

it will not go back into the trust fund. So, if that is the question 

of your constituent, will it go back into the trust fund, no, it will 

not. I assume it will go back into general revenue, but, again, that 

is my belief at this point in time. 

Ms. BROWN-WAITE. That was what I told her I believed, but 

I just wanted to check because—— 

Ms. GLENN-CROFT. That is correct. That is correct. 

Ms. BROWN-WAITE [continuing]. She said, ‘‘If that is the case, 

I am not sending it back.’’ 

Ms. GLENN-CROFT. But she can—— 

Ms. BROWN-WAITE. But—— 

Ms. GLENN-CROFT. She can certainly come in, and, obviously, 

by the time checks are received in the month of May, we will have 

procedures for that. It is not a new concept. We have had individuals walk in and return Social Security checks in the past, regular 

monthly benefit checks, so we do have a current process in place, 

but we need to make sure that it is applicable for these $250 

checks. But, again, they will not go to the trust fund. 

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Ms. BROWN-WAITE. Okay. And when you have that policy in 

place, if you would—— 

Ms. GLENN-CROFT. We can share that. 

Ms. BROWN-WAITE. That would be wonderful. And how much 

did it cost to send this notice out? 

Ms. GLENN-CROFT. We sent out about 52 million notices. The 

notices will all be out by the end of this week. I am giving you 

rough numbers here, but it probably cost between $20 million and 

$24 million in total to print and to mail those. I am going to say 

it was under 50 cents a notice. 

But the reason we do notices like this is because, if we do not, 

our field offices and 800 number will be besieged with calls and inquiries about these checks. So our history has shown that it is a 

more effective and actually a more economic approach to send out 

a notice when checks of this nature are issued. 

Ms. BROWN-WAITE. And this had been done in the past? 

Ms. GLENN-CROFT. We have done similar notices. We did similar notices when Part D first started. I have been with the agency 

now 30 years, started out on the frontline. We have been doing 

these kind of notices for special type of situations like this for 

years, and they are very effective. We have proven that this is a 

more economic and business-wise process to use. 

Ms. BROWN-WAITE. Mr. Chairman, would you indulge one 

other question? 

While you are putting together the new building and buying additional computers, software, hardware, will those computers work 

in concert with the Medicare computers at CMS because once 

Part—when the Medicare Advantage plans started saying, ‘‘Okay. 

We will pay your Part B or we will reimburse you for your Part 

B,’’ as you all know, it was a nightmare for your agency as well 

as for CMS because the computers did not talk to each other. Are 

we going to overcome this? 

Ms. GLENN-CROFT. Well, it was really a matter of exchanging 

data and the format of data and the completeness of data as we 

were trying to exchange data that CMS was sending us for this 

Part D activity. So, yes, we are going to continue to work with 

CMS so that we can share data more easily than our experience 

with Part D was, okay. Our computers talk together. It was just 

the format of the data that CMS was trying to share with us that, 

I understand, was the issue. 

Ms. BROWN-WAITE. So are you saying CMS was the problem 

because quite honestly—— 

Ms. GLENN-CROFT. I never like to say any other agency is the 

problem, but we had difficulty meshing their data with ours, and 

so it was a data exchange issue, but we worked it through. It was 

not an easy problem, and I would suggest that maybe I could provide more clarity for that for the record for you. 

Ms. BROWN-WAITE. Well, you are very kind in your description. It was a nightmare because—— 

Ms. GLENN-CROFT. Yes, it was. It was a difficult situation. 

Yes, it was, but we had difficulty with the CMS data. 

Ms. BROWN-WAITE. Okay. Thank you. 

Mr. Chairman, I yield back. 

Chairman TANNER. Thank you. 

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Mr. Kind, you are recognized. 

Mr. KIND. Great. Thank you, Mr. Chairman. 

I want to thank all our witnesses for your testimony today. It is 

always very helpful and very illuminating. 

But, Ms. Glenn-Croft, let me get back to the previous line of questioning about the mailing of the notices. You said about $20 

million to $24 million to notify roughly 53 million recipients or so. 

Is that right? 

Ms. GLENN-CROFT. Yes. And I might be a little high on that dollar amount, but it is, I would say, at least $20 million. 

Mr. KIND. Has the department gone through any other options 

of how best to notify people who have inquires? Because it is a little bit of a pet peeve of mine because last year, when we had the 

stimulus and rebate checks sent out, IRS sent out not one but two 

notices at a cost of almost $100 million, basically telling people that 

you do not have to file anything, you do not have to take any affirmative action, in fact, you do not have to do a thing, and you are 

still going to get those rebate checks, which is the same situation 

here with the Social Security or SSI recipients, is they do not have 

to take any affirmation action and they are still going to get economic recovery payments that will be going out. 

I would think that setting up some type of automated voice mail 

for people to punch 4 if you have a question about the economic recovery payments that will be going out and just have a standard 

response. And, if there is any further inquiries, you can direct them 

to the Web site where I am sure there is a more detailed explanation, they could get in touch with our congressional offices, and 

we would be happy to field some of these questions as well. 

You are shaking your head, so, apparently, you have thought 

through all this and—— 

Ms. GLENN-CROFT. Yes. And you know what? We have basically done everything that you suggested. So we are thinking alike 

here. 

In addition to sending out the informational notices, Congressman, we have Frequently Asked Questions on our Web site in a 

very prominent location. If someone would go into SSA.gov, you 

would find prominently Q’s and A’s that the public could look at 

if they had questions. 

We have put a scripted message on the 800 number. So, if you 

call our 800 number, you can get all the information you could potentially need from listening to that script. 

We have created a pamphlet which we are putting in our field 

offices. When people visit the field offices, they can pick up the 

pamphlet. And not only is the pamphlet in field offices, it is in WalMart stores all across the country. 

And in addition, we have specially trained our employees on the 

frontlines to answer any questions that they might get. 

So we are trying to use every means of communication so that 

the public will get answers, should they have questions on—— 

Mr. KIND. And you still fear that without the official notice 

being mailed out, you would be overwhelmed, the system would be 

overwhelmed—— 

Ms. GLENN-CROFT. Yes, we would, and we have also—— 

Mr. KIND [continuing]. With inquiries and—— 

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Ms. GLENN-CROFT. Yes. And we found that it will cut down 

dramatically on field office visits, 800 number visits, and the one 

thing I have to say with great pride about Social Security, when 

Social Security sends a letter to the members of the public, they 

open it up and they read it. We are a trusted agency, and they read 

our notices—— 

Mr. KIND. That is funny how that works. 

Ms. GLENN-CROFT [continuing]. And so it is a very effective approach for us. 

Mr. KIND. Mr. O’Carroll, let me ask you has the inspector general’s office looked at this at all as far as how we can streamline 

or find some savings on notification issues like this as it relates to 

the Social Security Administration. 

Mr. O’CARROLL. Congressman, no, we have not. But what we 

are looking at is, in terms of the money that SSA was given for 

issuing these checks, that that money is being used correctly, and 

probably what a lot of people do not realize is there is a lot of behind-the-scenes work going into it in terms of the Railroad Retirement Board and the Veterans Administration are both sending out 

the same checks at the same time. And what we are making sure 

of is that SSA is working with the other agencies so only one check 

goes out. So that is most of our background work on it. 

Mr. KIND. Okay. All right. 

Well, Ms. Glenn-Croft, we have a June statutory deadline as far 

as the payments. Are we going to be able to meet that, or how is 

that looking? 

Ms. GLENN-CROFT. We definitely are. Actually, all checks will 

be issued in the month of May. The first checks should start to arrive around May 4. We have phased them out throughout the 

money. Last checks should probably be received no later than May 

26, and we will finish processing these checks at least 3 weeks 

ahead of the statutory deadline. 

Mr. KIND. Are there any fraud or crime issues that we should 

be sensitive about with the mailing of these payments? 

Ms. GLENN-CROFT. At this point in time, I am not aware of 

any, but, obviously, should these issues arise, we will work with 

our colleagues in the IG to address them. 

Mr. KIND. Yeah, because I know last year—I think when the rebate checks were sent out, a lot of the Social Security recipients 

who normally do not file taxes found that someone else was doing 

it for them in order to qualify for the rebate checks, and that became a bit of a problem. So, hopefully, we have some overseers 

keeping an eye on any possible fraud that might occur. Great. 

Ms. GLENN-CROFT. And, again, we are working closely with 

our colleagues and the IG. 

Mr. O’CARROLL. Congressman, if I could just add to that, one, 

of course, you know, as we could see from the Web site, we have 

our antenna up. We are trying to ask anybody to report fraud, if 

there is anything along those lines. Hopefully, we will find out 

about it. The other thing that we are a little bit concerned with is 

that representative payees, when those checks are going out to 

them, how they are going to account for the $250 getting to the 

person that they represent, so—— 

Mr. KIND. Sure. 

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Mr. O’CARROLL [continuing]. We are kind of making sure that 

that will not be a vehicle for fraud. The other one that was a concern, too, is deceased payees in terms of that, by the time the 

checks come out, if the person dies and then the check is delivered 

to him, what is the process for reclaiming that money. 

Mr. KIND. So you are already looking into this, as far as—— 

Mr. O’CARROLL. Yeah, we are looking into those, too. 

Mr. KIND [continuing]. Safeguards that can be implemented? 

Mr. O’CARROLL. Yes, sir. 

Mr. KIND. Yeah, because I think we found last year, Mr. Chair- man, if I am not correct, that there were over $60 million of farm 

payments that went out to already deceased farmers under the 

USDA program. So that could be a major issue, especially when we 

are talking about Social Security recipients out there. 

Great. Well, thank you. That is all the questions I had. Thank 

you, again, for being here. 

Thank you, Mr. Chairman. 

Chairman TANNER. Thank you, Mr. Kind. 

Mr. Tiberi. 

Mr. TIBERI. Thank you, Mr. Chairman. 

Ms. Glenn-Croft—— 

Ms. GLENN-CROFT. Yes. 

Mr. TIBERI [continuing]. In your written testimony, you mentioned various obstacles that you all have when facing—well, that 

you face when you are hiring employees. You also mentioned a 

number of states have made it even more difficult by furloughing 

DDS employees. Ohio is one of those seven states furloughing those 

federally paid employees, 550 in the Columbus office that I represent, which has one of the worst backlogs in terms of processing 

times in the country. We all know there are extensive backlogs 

throughout our nation. 

I have three questions if you could answer the three. Can you 

please discuss the effects that the furloughs are going to have on 

the backlogs? If states are not drawing down that Federal money 

for those employees while they are on furlough, what is happening 

to that Federal money? And, finally, can you discuss what you all 

at Social Security are doing to work with states and local offices 

to resolve the furlough issue? In Ohio, they have been notified that 

they are going to be furloughed in July. 

Ms. GLENN-CROFT. Yes, I certainly can address those issues, 

and, obviously, that is of grave concern to us. It is my understanding that in Ohio—and I may have this wrong—I think that 

they are proposing 10 furlough days over—— 

Mr. TIBERI. Correct. 

Ms. GLENN-CROFT [continuing]. A 2-year period. 

Mr. TIBERI. Oh, I did not know it was the 2 years. 

Ms. GLENN-CROFT. That is my understanding at this point in 

time, although the circumstances for each of the states continues 

to change. 

Mr. TIBERI. Well, those furloughs will begin in July. 

Ms. GLENN-CROFT. Yes, I think that is correct. 

Right now, there are seven states that have hiring freezes and 

five that have furlough plans, and, obviously, the commissioner has 

aggressively taken steps to work with the Governors of these states 

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to try to get the Governors and the state Governments to exempt 

DDS employees from these furloughs. 

Furloughing or freezing hires really does not make any sense, we 

believe, from the state’s perspective. We understand that oftentimes the state does make these decisions because they want to be 

equitable, to treat all state employees the same. 

Mr. TIBERI. But it does not save them any money. 

Ms. GLENN-CROFT. But it does not save them any money. If 

anything, they lose money by doing this. They do not get administrative funding, which we provide, for every day that they have furloughs or, you know, freezes, whatever the case may be. Fifteen 

thousand cases a day nationwide do not get processed and are not 

paid that would be allowances. Millions of dollars that would be 

paid in benefits are delayed. So this is really a lose-lose—— 

Mr. TIBERI. What happens to the money that they are not drawing down? It just sits in the account? 

Ms. GLENN-CROFT. Well, it comes back, you know, into SSA’s 

budget. 

Mr. TIBERI. It gets sent to Texas probably. 

Ms. GLENN-CROFT. No. No, it does not get sent to Texas. 

But we are working very hard with each of the involved states 

to try to get that exemption. Really this is a lose-lose. The state 

employees lose. Your constituents in your state lose. Benefits are 

delayed. And we are paying the bills and we have the money and 

we want to keep the state employees working because it is just 

going to increase the backlog of cases that are out there. 

Mr. TIBERI. Can you touch on Ohio at all in terms of are you 

making any progress with the state to rescind the order? 

Ms. GLENN-CROFT. I know that we have had contacts with the 

governor. I know that we have had contacts, obviously, with the 

parent agent and the head of the DDS. I do not have any lastminute details on that. No, I do not. 

Mr. TIBERI. Can we follow up with your office on that? 

Ms. GLENN-CROFT. I certainly can follow up on that and get 

back to you. Obviously, we would ask your help in any way that 

you could to—— 

Mr. TIBERI. You bet. 

Ms. GLENN-CROFT [continuing]. Help us move that issue along. 

It is really a lose-lose situation for everybody involved. 

Mr. TIBERI. Well, particularly, when we are so far behind the 

national average anyway—and this has to put us, I would think, 

further behind. 

Ms. GLENN-CROFT. Absolutely. Your area is so far behind, especially in the hearing area, that this is just going to make everything worse. 

Mr. TIBERI. Mr. O’Carroll, I understand that you issued a report 

in March about the concerning effects of furloughing DDS employees. In your report somewhere, you mentioned the impact these actions will have on disability claims and the economy in these 

states. Can you expand on that? 

Mr. O’CARROLL. Yes, Congressman. One of the things we have 

been trying to do is get what we call quick response evaluations 

out, and as we saw the furloughs were coming up, we knew the 

backlogs that SSA was facing, we decided to try to size the issue, 

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and what we found at the time in March was that five states were 

looking at furloughs. Since then, events have overtaken us. In a 

sense, New Jersey, I think, and Ohio now are. So it is seven. 

The biggest one that we looked at the hardest was California, 

and we were finding that by having the furloughs—and I think 

they were doing 2 furlough days per month—so what we were 

sizing that with is that it would be about a 10 percent reduction 

in terms of people getting on to disability benefits, and then when 

we size that, we are taking a look at about $648,000 a month in 

disability benefits are not being paid because of the furloughs. 

So, again, if you are taking a look at Ohio on it, you could probably, you know, be using sort of that 10 percent number that we 

were doing or that we used on this one. You could see it is probably 

going to be in—I would say, about $100,000 a month. 

Mr. TIBERI. Is that available, that report? 

Mr. O’CARROLL. Yeah. I can get you that information on it, and 

I will get you the working papers where we calculated it for California, and I am pretty sure you can substitute Ohio numbers for 

that, but what my staff was saying—when we were just kind of 

talking about the different states and the impacts on it, we were 

talking, I think, about $100,000 to $120,000 a month would be the 

effect on Ohio. 

Ms. GLENN-CROFT. Actually, I think I have a little bit of a dif- ferent figure. I think it is about $345,000 a month in administrative money that is not—a month would be lost with furloughs. 

Mr. TIBERI. Wow. Thank you. 

Thank you, Mr. Chairman, for your indulgence. 

Chairman TANNER. Mr. Pomeroy, you are recognized. 

Mr. POMEROY. Thank you, Mr. Chairman. 

I apologize for being in and out of this meeting. It seemed like 

I had about 14 things scheduled during this time. But I very much 

wanted to attend the hearing. I appreciate you convening it. 

For a start, I wanted to thank you, Mr. Chairman, for making 

sure the funds that we have been talking about in the stimulus 

package got into the stimulus package in the first place. I think the 

matter of year-in and year-out tied appropriations spikes relative 

to SSA infrastructure, critical, though it is, for the operation of the 

Social Security program, this funding increase to address the growing computer crisis as well as the crisis in backlog was absolutely 

central and it would not have happened without at the table. I was 

able to watch some of that and really admire your leadership as 

a brand-spanking-new chairman when those discussions were coming together. 

Chairman TANNER. The gentleman is recognized for 5 more 

minutes! 

[Laughter.] 

Mr. POMEROY. That is good. 

It has been my pleasure to know and work with Mr. Schieber for 

some time, and I have come to respect significantly his expertise 

on many retirement income security matters. 

My questions would relate, first of all, to the interaction between 

the advisory Committee for Social Security and the administration 

of the program itself. My reference point is the IRS advisory Committee, which I am not sure if you are familiar with. They have a 

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fairly, I think, robust level of interaction and have been extremely 

helpful to the oversight Committee in terms of watching IRS governance. Would you—is your relationship with SSA similar to the 

IRS and their advisory Committee, or is it dialog less well developed? 

Mr. SCHIEBER. Well, I certainly do not know the inner workings of the IRS relationship. 

Mr. POMEROY. Yes, understood. 

Mr. SCHIEBER. In our case, we meet on a regular basis with the 

commissioner and with many other senior managers from Social 

Security as we look into various aspects of these issues. We hope 

we are helping. I am sure that from time to time when we issue 

reports, they wish we had been focusing on the moon program or 

something else. But we have had very cordial relations with most 

of the people that we have interacted with, and we have tried to 

be as supportive and directive as we can, understanding that we 

are an advisory board and, you know, we are not a management 

oversight Committee in any way, shape, or form. 

Mr. POMEROY. I think the role of an advisory Committee can 

be incredibly helpful. We, obviously, have the tremendous resources 

and expertise within SSA, but a third-party look, bringing expertise to that look, is helpful. We tend to be quite generalist in our 

backgrounds, even though I have been on this Subcommittee for 

several years. 

Mr. SCHIEBER. And have a much broader set of issues to deal 

with than our narrowly focused group. 

Mr. POMEROY. And especially when it comes to operation as opposed to philosophical design of the program. 

Mr. SCHIEBER. Right, right, right. 

Mr. POMEROY. In other words, how is it working? What do we 

need? So, in that regard still, I mean, I think your testimony today 

is as close to a witness setting his hair on fire in front of us as you 

are going to find, and you better not do that. You cannot afford—— 

Mr. SCHIEBER. No, I do not have that much to—it would not 

be a big fire. 

[Laughter.] 

Mr. POMEROY. But there is urgency on this computer issue. 

Mr. SCHIEBER. I believe there is. 

Mr. POMEROY. For the last several years, I have been obsessing 

on ALJs. I believe that failure to address it in a timely way—— 

Mr. SCHIEBER. I agree. 

Mr. POMEROY [continuing]. Led to a horrible diminishment 

of—— 

Mr. SCHIEBER. I saw your hair close to being on fire when 

they—— 

Mr. POMEROY. Yes. I so miss Stephanie Tubbs-Jones because, 

by golly, no one has set their hair on fire better than her. But I 

believe that she would be highly energized by what you told us 

today. I am as well. 

I think we need to get this across not just the panel, which I am 

sure shares your concerns, but we need to somehow—if there is 

some role that this Committee can play in cranking up the urgency, and you offered at the end of your testimony to have a more 

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ment. You know, I applaud the director of SSA, the administrator, 

for essentially being the first to really call this to our attention. 

Mr. SCHIEBER. Absolutely. 

Mr. POMEROY. It was in much worse shape than I had any 

idea, again having long been a Member of this Subcommittee. 

Mr. SCHIEBER. We were totally shocked when he brought it to 

our attention last November. 

Mr. POMEROY. So it is a shared concern. This is not you—— 

Mr. SCHIEBER. Correct. 

Mr. POMEROY [continuing]. Telling him everything is horrible 

and they are saying everything is great. It is a shared concern. But 

maybe we can pool resources to really identify this as the highest 

priority and getting it up and running. I applaud the—— 

Mr. SCHIEBER. One—— 

Mr. POMEROY. Yeah. Go ahead, Syl. 

Mr. SCHIEBER. One of the things that—you go back and you 

look at the original act that created Social Security as an independent agency back in 1994. It required that the commissioner 

put together an annual budget that reflected the resources that 

would be needed for the commissioner and the agency to do the 

work that they have unfolding on their plate. 

That budget is regularly prepared, and it is submitted to OMB, 

and there are discussions between OMB and the commissioner on 

that budget, and it enlightens the process of developing the President’s budget that is ultimately submitted to the Congress, but, by 

the time that budget gets to Capitol Hill, it is a singular number 

embedded in the President’s budget. 

Now my guess is that singular number in all those pages of documents is not very informative. We have not had great detail on all 

of the matters that are actually embedded in the commissioner’s 

budget from year to year and my guess is you have not either. If 

we want to begin to understand the resources they really need, 

then somewhere there needs to be a viewing of that budget on the 

part of some of the other players involved. 

Mr. POMEROY. That is absolutely correct. 

Ms. Glenn-Croft, could you speak to that? 

Ms. GLENN-CROFT. I would be glad to. I would have to say 

under this commissioner that this commissioner is a very collaborative commissioner. He is a very transparent commissioner, and 

I would say since he came in the spring of 2007 that we have spent 

more time working with Hill staff, communicating with Hill staff 

on our budget needs than I believe has ever historically been done. 

Mr. POMEROY. I think that is good, but I remember, you know, 

like on an oversight Subcommittee, I would have the advisory Committee budget and some text of what they had recommended. You 

know, I have never seen any of that from the advisory Committee. 

I am not suggesting that is anybody’s fault. I just think more information from the advisory Committee analysis—— 

Ms. GLENN-CROFT. I—— 

Mr. SCHIEBER. We—— 

Mr. POMEROY [continuing]. And comment and review of the 

budget would be helpful. 

Mr. SCHIEBER. We have not had the kind of detail that would 

allow us to prepare that sort of document. This is not in any way, 

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shape, or form an implication that the current commissioner is not 

forthcoming. He has been remarkably forthcoming and, I think, is 

doing a tremendous job. Anything I said here today should not be 

considered—— 

Mr. POMEROY. I understood it that way. I think he is doing a 

good job, too. 

I see in a PowerPoint—and I know my time is up, so I need to 

hurry—prepared by SSA for a staff briefing in October of 2008 

talking about 3 to 5 years out of electrical capacity on the data center floor. I mean, we are talking about the thing literally maxing 

out. 

Now I know that you have shifted functions into new facilities 

to some extent, rewired some other things, but I am telling you this 

sounds a little bit piecemeal for the Social Security system of the 

United States of America. I mean, it really does seem as though 

we are up against it in terms of an appalling deficiency in terms 

of state-of-the-art infrastructure to administer a program so critically important to the financial security of so many millions of 

Americans. 

Ms. GLENN-CROFT. And we take that responsibility very seriously, but, really, if I could have just a minute, I really would like 

to leave this hearing with making clear just really where we stand 

with this situation. 

It is true that we probably are going to run out of electrical capacity to be able to plug in those servers, let’s say, sometime in 

2012 or 2013. And we could extend and put in more electrical capacity in the NCC, but we are not going to need to do that. We 

have Durham that is coming up. Durham will be able to take on 

additional work by that point in time. 

So the issue of the electrical capacity, because of Durham coming 

up, is really becoming less and less of an issue all the time. Again, 

I want to reiterate we believe that we can keep the NCC going an 

indefinite period of time through preventative maintenance, regular maintenance. We believe that we can keep it up until the computer center is built. 

Mr. POMEROY. Well, I appreciate that, but, I mean, I looked at 

some pictures of some of the wiring coming into that building, and 

I know that that—I have not toured the facility, so, I mean, you 

cannot draw too much from that. But I believe the will of Congress 

is reflected in the $500 million dedicated to this project, put into 

the stimulus by the chairman with the support of the membership. 

I do not think making do, getting by, Scotch tape, and bailing 

wire is the way we need to treat the electronic infrastructure for 

the Social Security program of this country, and I think that Congress has made a decisive commitment of resources to get on with 

it. I mean, I would look for a robust level of interaction, advisory 

Committee, Social Security Administration, and this Committee in 

terms of making sure we keep this on task as the highest priority. 

I hope, Mr. Chairman, we will be meeting regularly on this. I 

have something more than ALJs to obsess about now. 

[Laughter.] 

Ms. GLENN-CROFT. Okay. 

Mr. POMEROY. Thank you very much. 

Ms. GLENN-CROFT. We will do that. 

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Chairman TANNER. Thank you, Mr. Pomeroy. 

I want to again thank all the witnesses for this and to tell you 

that we may well have another hearing sooner rather than later to 

see how we are coming along because of all the concerns that all 

of the Members have expressed with regard to this situation. 

Let me ask one other question, if I could, Mr. Hewell. As the Administration tries to acquire space for more hearings to address the 

backlog, we are running into some problems from GSA being able 

to acquire some of this space in a timely fashion, sometimes as 

much as 2 years. Could you look into that for us? I mean, I know 

most of us rent from GSA back in our districts, and I might say 

if their rent is like mine, it is not a matter of you not having the 

resources to—— 

[Laughter.] 

Chairman TANNER. No, I am kidding. But, seriously, it is taking an extraordinarily long period of time to acquire some of this 

space, so we are told. 

Mr. HEWELL. We will get you—— 

Chairman TANNER. Up to 2 years. 

Mr. HEWELL [continuing]. Information on that. 

Chairman TANNER. Yes. 

Mr. HEWELL. I do not have it with me, and I would not want 

to get the facts wrong 

Chairman TANNER. Well, if you could respond to facilitate this, 

because that is exactly what the recovery bill was intended to do, 

is try to address some of these problems that are real. When people 

are dying before they can get a hearing because of the backlog, 

sometimes over a year, that is a pretty sad commentary on our 

ability to function as an efficient Government. 

So, anyway, thank all of you. We may be back in touch, and if 

there are any questions we may submit, we may ask that you entertain those in a timely fashion. 

If not, the meeting is adjourned. Thank you. 

[Whereupon, at 3:40 p.m., the Subcommittee was adjourned.] 

[Questions for the Record follow:] 

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[Submissions for the Record follow:] 

Statement in Support of HR322 

May 4, 2009 

There are over 30,000 grandparents like us in Arkansas who are raising grandchildren. We have been forced to return to work in order to provide for our new families. 

HR322 will help us tremendously. Currently, I am working as an adjunct for two 

Arkansas universities but because of the earnings limits on Social Security I can 

only teach 8 classes a year. My wife is disabled, so she is unable to work. 

If the earnings limitation is eliminated I can teach more classes and adequately 

provide for my family. 

I am presently in a doctoral program and hope to complete it in 2011. At that 

time I should be in a position for a fulltime faculty position. Also, I will be 66 and 

the earnings limit will not apply. 

In the meantime, I need for HR322 to pass this year so I can teach more classes 

until I finish my doctorate. 

My thanks to Congressman Gene Green (TX) for his sponsorship of this tremendously important bill. 

I encourage you to pass this bill as soon as possible. It has long reaching benefits 

for grandparents raising grandchildren. 

The passage of HR322 also increases tax payments to the Treasury and additional 

payments to the Social Security system. 

This is a win-win piece of legislation. 

Dale and Linda Walker 

f 

To the Ways and Means Chairperson: 

This is in response to Social Security Disability Appeals. I have applied to disability since Feb. 2007 and have been awaiting for a hearing with ALS Judge for 

a review. Due to the long waiting process it has caused applicants to lose all health 

benefits and become homeless due to such waiting periods. I propose to SSA that 

when people apply for disability that they be granted approval upon request to receive disability payments and Medicare benefits at time of applying. If applicants 

aren’t eligible or approved for these benefits then SSA can take these benefits back 

at age 62 or 65 when they receive social security. By this process, we cut health 

care costs, homelessness, and relieve the burden that currently hampers social security administration to be more effective in there day to day operations of serving 

the people. I myself have been out of work due to medical illness and continue to 

wait on appeal process causes me to suffer daily due to no insurance and having 

to go into foreclosure on my home. So please I insist that this committee work more 

efficient to resolve these social security cases. 

Thank You, 

Larry S. Stoudemire 

f 

Chairman Tanner, Congressman Johnson, Members of the Subcommittee on Social Security: This hearing was called for the purpose of reviewing the progress 

made by the Social Security Administration (SSA) and other involved agencies in 

appropriately using the resources allocated by the American Recovery and Reinvestment Act of 2009 (ARRA). The National Association of Disability Examiners (NADE) 

appreciates this opportunity to submit comments on this important subject and we 

commend the Subcommittee for its continuing oversight of this important issue. 

Who We Are 

NADE is a professional association whose purpose is to promote the art and 

science of disability evaluation. The majority of our members work in the State Disability Determination Service (DDS) agencies adjudicating claims for Social Security 

and/or Supplemental Security Income (SSI) disability benefits. As such, our members constitute the ‘‘front lines’’ of disability evaluation. However, our membership 

also includes SSA Central and Regional Office personnel, attorneys, physicians, non 

attorney claimant representatives, and claimant advocates. It is the diversity of our 

membership, combined with our extensive program knowledge and ‘‘hands on’’ expewwoods2 on DSKGBLS3C1PROD with HEARING

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rience, which enables NADE to offer a perspective on disability issues that, we believe, is both unique and reflective of a programmatic realism. 

NADE members—throughout the DDSs, SSA Regional Offices, SSA Central Office, ODAR offices and throughout the private sector, are deeply concerned about the 

integrity and efficiency of the Social Security and the SSI disability programs. Simply stated, we believe those who are entitled to disability benefits under the law 

should receive them; those who are not, should not. Decisions on disability claims 

should be reached in a timely, efficient and equitable manner. The continuing backlogs in disability claims are an embarrassment to all of us within the disability program as is the length of time claimants wait for a decision. Our embarrassment, 

however, is nothing compared to the nightmare experienced by those waiting for a 

decision. A large portion of the monies allocated in ARRA was to aid SSA’s efforts 

to significantly reduce the backlogs of disability claims and improve the timeliness 

of its decisions on these claims. 

The Issue 

The American Recovery and Reinvestment Act of 2009 provided nearly $1.1 billion 

to the Social Security Administration. Included in this amount were $500 million 

for a new National Computer Center and an additional $500 million for new staff 

and supporting infrastructure to help the Agency deal with a backlog of claims 

while also assisting the Agency in the processing of an expected increase in the 

number of claims for disability and retirement benefits. 

NADE members are very appreciative of this renewed support Congress has provided to SSA, especially after nearly two decades of less than adequate financial 

support that left the Agency ill prepared to handle the growing number of claims. 

The recognition by Congress of the critical need for adequate resources at SSA, and 

the willingness demonstrated by Congress to accept a leadership responsibility on 

this matter, has resulted in vital funding urgently needed for SSA. We greatly appreciate the support for funding at a level above the President’s proposed FY 2009 

budget and for the $1.092 billion in funding included for SSA in the American Recovery and Reinvestment Act of 2009. We hope you will also support the President’s 

FY 2010 Budget Request of $11.6 billion for SSA’s administrative expenses. 

Having provided these funds, it is only to be expected that Congress would exercise its oversight authority to insure that these funds are spent appropriately and 

that the problem of backlogged claims and lengthy waiting times is resolved. NADE 

has confidence in the current leadership at SSA to apply these monies as directed 

by the legislation and also by a decision making process that is fully aware of the 

problems and the need for requisite resources to address these issues. We will not 

address the spending issue as that is a responsibility for which other witnesses appearing before this subcommittee have greater knowledge. However, while it is too 

early to determine if the new funding will aid in the resolution of the issues for 

which the funds were appropriated, NADE members are confident that these monies 

will have their desired impact. 

SSA is facing an unprecedented backlog of more than 1.3 million claims for Social 

Security and Supplemental Security Income disability benefits. This backlog of 

claims is particularly problematic at the hearings stage, where the backlogs have 

more than doubled since 2000—from about 310,000 claims to more than 765,000— 

and the average waiting time per claim has soared to over 500 days. At the DDS 

level, the average processing time for an initial claim has risen from less than 40 

days two decades ago to nearly 100 days in the past year. Not coincidentally, this 

increase in processing times and backlogs have occurred simultaneously with congressional budgets that included less funding for SSA than what numerous Commissioners of Social Security and other witnesses, including this Association, have testified was absolutely necessary for the Agency. 

Presidents requesting less money than SSA indicated it needed and Congresses 

appropriating even less money than the President requested for SSA must share in 

the responsibility for the current crisis with Agency managers who sought to 

downsize SSA to utilize precious financial resources in other areas rather than filling vacant positions. Now the situation is reversed and the President and Congress 

recognize that SSA must have the requisite staff and supporting infrastructure to 

process the growing number of claims. However, just as the current crisis did not 

occur overnight, it will not be resolved overnight. 

Addressing the Issues 

SSA has immediately taken action to begin the hiring of new staff at its Field 

Offices, in its hearing offices and in its supporting offices. Concurrently, the state 

DDS have been given funding for new hires. All total, SSA projects it will hire 7000 

new employees in this fiscal year. This level of hiring will tax the Agency’s resources 

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to adequately train these new personnel but, once trained and allowed to become 

proficient in their jobs, these new personnel are expected to make a positive impact 

on the Agency’s ability to process the growing number of disability and retirement 

claims that is expected to continue flooding the Agency. 

Hiring these new personnel is a critical first step. The ability to recruit the best 

and brightest, to hire, and then train these personnel, is a process that will take 

some time. In addition, new employees are not expected to have an immediate impact on current or backlogged claims as they must be allowed sufficient time to become proficient in the performance of their work duties and responsibilities. In addition, current staff must be allocated to provide the requisite training and mentoring 

of new staff. This reduces the amount of time experienced personnel will have to 

process their own work, thereby reducing their productivity in the short term. However, we firmly believe positive benefits are to be gained from the funding provided 

by ARRA and will be fully realized in a matter of 2–3 years. 

SSA and the DDSs will have to invest heavily in staff retention in future years. 

Both are facing a massive retirement wave and, prior to the onset of the current 

economic downturn, both were reporting heavy staff turnover (15 percent in the 

DDSs) due to low salaries and increasing job stress. 

Why Is It Important to Provide Increased Funding for SSA? 

NADE believes SSA’s ability to provide timely customer service is critical. No 

other agency in Government has the potential to impact so many people and the 

vast majority of Americans will judge the Government’s ability to serve their needs 

based on how effective and how efficient SSA is able to meet their needs. SSA is 

America’s ‘‘Window’’ to its Government. It can ill afford to fail in its mission 

and must be provided with the resources necessary for the Agency to 

achieve its mission in a timely manner. The growing complexity of the Social Security and SSI Disability Programs, coupled with the need to 

produce a huge volume of work, justifies even more the need for adequate 

resources in order to provide the service that the American public has 

come to expect and deserves from SSA. 

In FY 2008, Congress appropriated more money for SSA’s administrative budget 

than the President had requested, marking the first time in 15 years Congress had 

acted so favorably. At the time Congress took this action, a former Chairman of this 

Social Security Subcommittee offered the observation that constant under-funding 

of the disability program by the Congress over the past two decades had contributed 

heavily to the current crisis. We do not dispute such wisdom! We do believe, however, that the congressional action of FY 2008 and the additional funding provided 

for SSA in the ARRA of 2009 are the first steps in a long road back to management 

stability for SSA. It now falls to SSA, and its components, to utilize these funds for 

actions that will produce the desired outcome. 

State Furloughs of DDS Personnel 

The best intentions of Congress in appropriating increased funding for SSA to 

deal with its backlogs of claims and to process the growing number of new claims 

is being undermined in many states by Governors who, faced with their own budget 

crises, have implemented furloughs for their state employees and hiring freezes for 

all state agencies. NADE, and other witnesses appearing before this Subcommittee, 

have previously pointed out that many of these states have adopted these actions 

unilaterally, failing to provide an exemption for DDS employees, who are 100 percent federally funded and who have no impact on any state’s budget problems. 

These actions fly in the face of the positive actions taken by this Congress to appropriate funds to resolve the crises of backlogged claims at SSA and lengthy waiting times for applicants. In spite of numerous requests from the Commissioner of 

Social Security, from Members of Congress and from the media, the Governors have 

not backed off of their decisions, either because they don’t want to treat one set of 

state employees differently from any other or because they simply refuse to acknowledge the absurdity of their actions. These actions not only punish DDS employees (since furloughing DDS employees does not save any state any money, there 

can be no other reason to furlough these employees other than to punish them for 

being state employees) but remove a key investment in America’s economic recovery. 

More importantly, such actions by these Governors to furlough DDS employees and 

to reduce and/or eliminate the DDSs ability to hire new staff will only enhance the 

growth of the backlogs of disability claims, add to the processing time of current 

claims and remove from the workforce the opportunity for many citizens to obtain 

much needed jobs. How Governors, when their actions otherwise have no positive 

benefit to resolving their state budget crises, can maintain such insensitivity to the 

needs of their own citizens, is beyond reason. 

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Recent data has shown applications for initial disability claims have, not surprisingly, increased by 10 percent since the beginning of this fiscal year. Each week, 

the number of initial claim filings has increased from the week before and the number of new claims in calendar year 2009 is up 13.7 percent. The actions to furlough 

DDS employees and to reduce or eliminate the DDS’ ability to hire new staff have 

the effect of reducing the size of the workforce processing these claims or reducing 

the hours available for the workforce to process these claims, thereby reversing the 

action taken by Congress to address the crisis in backlogs and lengthy processing 

times. If these state actions are not abated, then the disabled citizens seeking benefits will almost certainly face the prospect of even longer processing times and extended appeal times. 

The current level of furloughs of DDS personnel is estimated to cost the States 

$7.8 million in administrative funding paid to them by SSA. How can losing money 

save money? The current level of furloughs of DDS personnel is also estimated to 

delay the processing of 15,000 claims and the payment of $4.2 million in benefits 

each month! How can Governors continue to justify their actions? 

We call upon Congress to intercede on behalf of all state employees who are 100 

percent federally funded. We recognize difficult times require difficult decisions but 

difficult times do not require foolhardy decisions. 

Program Integrity Issues 

Limited resources in recent years have forced SSA to reduce the number of Continuing Disability Reviews (CDRs) performed. Of concern to NADE is the past history similar actions have had as the agency fell behind in these critical reviews. 

When a backlog of CDRs occurred previously it took several years of dedicated funding and a tremendous effort by SSA and DDS staff before SSA was, again, current 

with CDR reviews. With the decrease in the number of CDR reviews done in the 

past few years, there is now a real danger the Agency will, once again, find itself 

in the position of having backlogs of overdue CDRs. Thus, it is possible the Agency 

will work itself out of one backlog into another. 

While there are increased administrative costs (including the purchase of medical 

evidence, claimant transportation costs and increased utilization of contract medical 

consultants) with the performance of CDRs, there is a potential for significant savings in program costs with the elimination of benefits paid to beneficiaries who are 

found to be no longer eligible for disability benefits due to no longer meeting the 

SSA Disability program requirements. A recent estimate by GAO revealed that, for 

every $1 in administrative cost spent on conducting CDRs, nearly $15 of program 

funds was saved. This data was significantly higher than the historical ratio of 10– 

1 savings. Regardless of which statistic has current validity, there are significant 

savings to be realized if SSA can remain current on CDRs. It is essential to program 

integrity that CDR reviews be conducted in a timely manner to ensure that only 

those who continue to be eligible are receiving disability benefits. 

Anti-fraud efforts such as the Cooperative Disability Investigative (CDI) units 

which effectively utilize the strengths and talents of SSA’s Office of Inspector General (OIG), local law enforcement, and disability examiners, offer a visible and effective front-line defense for program integrity and serve as a visible and effective deterrent to fraud. SSA’s Inspector General attributed the success of the CDI units 

to investigate fraud allegations to the efforts of ‘‘. . . those most qualified to detect 

fraud—DDS adjudicators.’’ NADE supports the continued expansion of the CDI 

units to combat fraud and abuse in the disability program. 

5 Month Cash Benefit Waiting Period and 24 Month Medicare Waiting Period 

It is important to note that persons found disabled under Title II of the Social 

Security Disability Act must complete a full five month waiting period before they 

can receive cash benefits. So, a disability allowance decision, even when it is processed quickly, will not resolve the issue of having to wait five full calendar months 

before the claimant receives any cash benefits. NADE believes this five month waiting period is a gross inequity to American citizens with disabilities. 

Likewise, we are deeply concerned about the hardship the 24 month Medicare 

waiting period creates for these disabled individuals, and their families, at one of 

the most vulnerable periods of their lives. Social Security disability beneficiaries 

have serious health problems and limited access to health insurance. Many cannot 

afford private health insurance due to the high cost secondary to their pre-existing 

health conditions. Since earlier medical intervention could help many disabled individuals return to work, NADE supports the elimination of the Five Month Waiting 

Period for Cash Benefits and the 24 Month Waiting Period for Medicare eligibility. 

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Summary 

The operational challenges facing SSA are substantial and are expected to become 

even more acute in the coming years as our society ages, as baby boomers continue 

to prove the actuaries correct regarding their forecasts of the baby boomers most 

disability prone years, as the economy continues to offer periodic setbacks, etc. Decades of inadequate resources for SSA, combined with increased workloads and less 

than desirable results from multiple redesign efforts, have not only caused backlogs 

in the number of disability claims pending at the initial and hearing levels, but has 

allowed existing backlogs to increase. Processing time, expected to decline with the 

introduction of new technology has, instead, increased due to insufficient resources 

in personnel. 

Recent increases in funding for SSA’s administrative budget and additional funding provided through the American Recovery and Reinvestment Act of 2009 can be 

expected, in the years ahead, to produce significant reductions in, or elimination of, 

SSA’s backlogged claims and lead to improvements in processing times at all levels. 

However, this new funding cannot, and will not, overnight, make up for mistakes 

of the past. The need to hire, train and deploy new staff will take several years before any realistic expectation that they will contribute significantly toward efforts 

to reduce the backlogs of claims. 

No amount of planning by SSA or Congress can reverse the negative impact on 

production and processing times caused by state hiring freezes and furloughs of 

state employees which also affect DDS personnel. Congress must support the Commissioner’s efforts to force the states to exempt DDS employees, who are 100 percent federally funded, from such actions. 

The crisis of backlogged disability claims, while a significant problem, cannot be 

used as a reason to abandon program integrity initiatives. It remains critically important that the public’s confidence in the disability program not only be restored 

but maintained. 

A lot of effort has been made to improve the speed at which disability claims are 

processed and to eliminate/reduce the backlogs of claims. NADE agrees improvements are needed and we support recent initiatives, such as the Compassionate Allowance (CAL) initiative and the Quick Disability Determination (QDD) initiative. 

However, the 5 month waiting period for cash benefits and the 24 month waiting 

period for Medicare eligibility negate the positive impact of faster processing times 

and reduced backlogs. These waiting periods should be eliminated. 

No other agency has a greater impact on the quality of life in this nation and the 

American public will judge the ability of their Government to meet their needs almost solely by the quality of service provided by SSA. Social Security can and must 

do better in fulfilling its promise to America and NADE stands ready, willing, and 

able to assist in fulfilling that promise. People with disabilities, already burdened 

by the challenges of their illness/injury, are often in desperate need of benefits to 

replace lost income. They deserve, and should receive, timely and accurate decisions 

through a fair and understandable process. Our challenge, and one which must be 

met, then is to ensure the disability determination and appeals process meets those 

criteria. 

We commend the Subcommittee for exercising its oversight authority and we look 

forward to working with the Subcommittee to achieve the goals we have outlined 

in this statement. 

Exhibit I—Furlough Status of State DDSs 

Status of Furlough/Hiring Freeze by DDS—as of 4/28/09 

DDS Furlough Status Hiring Freeze Status Remarks 

Alabama No furlough DDS exempt from 

state hiring freeze 

Alaska No furlough Hiring freeze but DDS 

exempt 

Arizona Furlough but DDS 

exempt 

Hiring freeze but DDS 

exempt 

Arkansas No furlough No hiring freeze 

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Status of Furlough/Hiring Freeze by DDS—as of 4/28/09—Continued 

DDS Furlough Status Hiring Freeze Status Remarks 

California Furlough in place DDS exempt from 

state hiring freeze 

All DDS employees 

furloughed 2 days 

per month—started 

in February 2009. 

Employees will 

earn one ‘‘self-directed’’ furlough 

leave day per 

month, which allows employees personal discretion 

when to use their 

furlough leave. Also 

per the agreement, 

employees must 

use the earned 

leave furlough 

leave by July 1, 

2012. Employees 

will also have their 

pay reduced by 4.62 

percent per month 

through June 2010. 

Colorado Considering furloughs, DDS not 

likely exempt 

Hiring freeze but DDS 

exempt 

Possible furlough of 

DDS employees up 

to 2 days per 

month (next state 

FY) 

Connecticut Administrator took 

one voluntary furlough day. The 

governor extended 

the request for voluntary furloughs 

to all state employees through June 1 

Hiring freeze but DDS 

exempt 

Delaware No furlough Hiring freeze but DDS 

exempt 

The Delaware governor has proposed 

an 8 percent across 

the board pay cut 

and an increase in 

the employee share 

of health insurance 

premiums, effective 

July 1st. The net 

effect is approximately a 10 percent 

decrease in employee take home 

pay. The Governor 

has stated that he 

is proposing this to 

avoid furloughs. 

District of Columbia No furlough No hiring freeze 

Florida No furlough No hiring freeze 

Georgia Furlough but DDS 

exempt 

Hiring freeze but DDS 

exempt 

Hawaii Considering furloughs but DDS 

likely exempt 

Hiring freeze but DDS 

exempt 

Idaho Furloughs but DDS 

exempt 

Hiring freeze but DDS 

exempt 

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Status of Furlough/Hiring Freeze by DDS—as of 4/28/09—Continued 

DDS Furlough Status Hiring Freeze Status Remarks 

Illinois No furlough No hiring freeze 

Indiana No furlough Hiring freeze for DDS Several positions ‘‘deactivated,’’ including 30 disability examiners. These positions are temporarily eliminated 

and would require 

‘‘reactivation’’ to be 

filled again. 

Iowa No furlough Hiring freeze but DDS 

exempt 

Kansas No furlough Hiring freeze ‘‘Soft’’ freeze—hiring 

is restricted but occurs as warranted. 

DDS hired 75 percent of positions. 

Kentucky No furlough Hiring freeze but DDS 

exempt 

Louisiana No furlough Hiring freeze DDS hiring freeze but 

given a limited 

number of hires. 

Maine No furlough Hiring freeze but DDS 

exempt. 

Maryland Furloughs in place Hiring freeze but DDS 

exempt 

Furlough between 2 

and 3 days depending on salary. 

Massachusetts Furloughs in place Considering a hiring 

freeze and DDS not 

likely exempt 

Furloughing 3 days 

for DDS managers. 

Most are going to 

work the days and 

be compensated 

after retirement. 

They can also work 

without pay. Hiring 

cap RO successful 

in getting the cap 

lifted for DDS disability examiner 

positions. 

Michigan No furlough No hiring freeze Furlough may be possible in 2010. 

Minnesota No furlough No hiring freeze 

Mississippi No furlough No hiring freeze 

Missouri No furlough No hiring freeze 

Montana No furlough No hiring freeze 

Nebraska No furlough No hiring freeze 

Nevada Considering furloughs but DDS 

likely exempt 

Hiring freeze but DDS 

exempt 

New Hampshire No furlough Hiring freeze but DDS 

exempt 

Staffing CAP in DDS 

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Status of Furlough/Hiring Freeze by DDS—as of 4/28/09—Continued 

DDS Furlough Status Hiring Freeze Status Remarks 

New Jersey DDS employees exempt from furlough No hiring freeze 

New Mexico No furlough Hiring freeze 

New York Considering layoffs 

that would include 

DDS employees 

Hiring freeze but DDS 

exempt 

North Carolina Furloughs just ordered by the Governor. Questionable as to whether 

DDS is exempt. 

Hiring freeze DDS hiring is considered on case-bycase situation 

(some DDS hires 

have been approved) 

North Dakota No furlough No hiring freeze 

Ohio Furlough to take effect on July 2009. Hiring freeze but DDS 

exempt 

State announced furloughs to be effective 7/09. All DDS 

employees expected 

to be furloughed 10 

days over 2 state 

FYs. 

DDS says it is under 

a hiring freeze, but 

it has received approvals to hire. 

Travel restrictions 

in place. 

Oklahoma No furlough No hiring freeze 

Oregon Furlough in place Hiring freeze but DDS 

exempt 

Furlough for management staff from 2 

to 4 days depending 

on salary range. 

Furloughs expected 

for represented 

staff but the number of days has not 

been finalized. Governor is proposing 

26 furlough days. 

Pennsylvania No furloughs Hiring freeze but DDS 

exempt 

All out of state travel 

restricted. 

Puerto Rico Layoffs planned but 

DDS likely exempt. 

Hiring freeze but DDS 

exempt 

Rhode Island No furlough DDS exempt from 

state-wide hiring 

freeze 

South Carolina Considering furloughs but DDS 

likely exempt 

Considering hiring 

freeze but DDS likely exempt 

South Dakota No furlough Hiring freeze DDS hiring is considered on case-bycase situation 

(some DDS hires 

have been approved) 

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Status of Furlough/Hiring Freeze by DDS—as of 4/28/09—Continued 

DDS Furlough Status Hiring Freeze Status Remarks 

Tennessee No furlough Hiring freeze but DDS 

exempt 

Texas No furlough No hiring freeze 

Utah No furlough Hiring freeze but DDS 

exempt 

Vermont Considering furloughs, DDS not 

likely exempt 

No hiring freeze Staffing CAP in DDS 

Virginia No furlough DDS exempt from 

state-wide hiring 

freeze 

Washington No furlough Hiring freeze but DDS 

exempt 

West Virginia No furlough Temporary restriction 

on hiring through 6/ 

30/09. 

Hiring restriction 

maybe extended 

through 9/30/09. 

Also, all personnel 

actions (including 

promotions) in the 

State are not being 

acted upon until 

further guidance is 

received by the governor. 

Wisconsin No furlough Hiring freeze for DDS 

Wyoming No furlough DDS likely exempt 

from state-wide hiring freeze 

Æ 

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