administrative tasks throughout the Agency, and for printing notices for

Immediate mailing to beneficiaries; and

Replacement or upgrade of equipment that has become outmoded, unreliable or costly to maintain.

This budget also supports investments in automated data processing equipment and services for the State Disability Determination Services. In recent years these State agencies have improved productivity and quality with limited support in terms of automation. The States are now faced with significant increases in projected disability workloads; coupled with increased emphasis on quality and training on and Implementation of new childhood disability regulations, which will result in slightly reduced productivity. We now, more than ever before, need to make sure that State Disability Determination Services employees have the automated tools they need to do their jobs efficiently.

SSA's 1992 budget request also restores limited funding for other critical areas of SSA employee support. For example, we plan to replenish near-depleted inventories of supplies, forms and public information materials; and we will make minimal investments needed to ensure employee health and safety in SSA's facilities. In addition, funds will be restored for employee training and for basic building repairs and maintenance, to finance the most critical repairs deferred from prior years and prevent further deterioration of our facilities.

I am committed to the employees of the Social Security Administration whom I have asked to enter into a partnership with me to ensure the continued efficient operation of this program, one that has paid benefits each month, on time for the past 50 years. We will continue to work together in this partnership to deliver quality public service and to safeguard the Social Security programs for our current and future beneficiaries.

Fiscal Year 1991 Supplemental Request

SSA also has before the Committee a fiscal year 1991 supplemental budget request related to the significant increase in work this Agency faces as a result of the Supreme Court decision in the case of Sullivan v. Zebley. This decision calls for SSA to reevaluate childhood disability claims for SSI benefits which have been denied because the child's functional limitations were not considered in evaluating the severity of the Impairment. Although details for implementing the decision are still being worked out with the court, SSA's budget estimates assume that nationwide class relief will extend to claims denied since January 1980, resulting in 200,000 to 300,000 new disability determinations for Zebley class members.

To fund SSA and State Disability Determination Services costs for this large, one-time workload -- including making new disability determinations for Zebley class members who request one, evaluating income and resources for those class members determined to be disabled, and processing appeals of denials - the President has requested a supplemental appropriation for fiscal year 1991, with funds to remain available through the end of fiscal year 1993.

Regulations used to evaluate childhood disability entitlement have been revised based on the Zebley decision to make them comparable to the regulations used to evaluate adult categories. As a result, we also anticipate an increase in ongoing SSI disability workloads, beginning in fiscal year 1991, due to the revisions made to the childhood disability regulations.

Social Security Trust Funds

I would like to say a few words about the Social Security trust funds. Funds to pay benefits from the Old-Age and Survivors Insurance and Disability Insurance (OASDI) Trust Funds are permanently appropriated, and therefore are not part of the budget requests before this Committee. In fiscal year 1992 we expect to make payments of

about $253.6 billion to 36.2 million OASI beneficiaries, and payments of $28.7 billion to

4.4 million DI beneficiaries. Administrative expenses remain a small fraction of the

overall trust fund operations.

Maintaining the integrity of the trust funds is one of my major goals; and the budget

shows steadily increasing balances in the OASI and DI trust funds, to meet our obligations to tomorrow's elderly and disabled and surviving families, to a level of $335 billion by the end of fiscal year 1992.

Conclusion

In conclusion, Mr. Chairman, although less than 2 percent of the overall costs for the programs we manage are for administrative expenses, these expenses are critical to the effective delivery of service to our constituents. That is why I am here today to present the President's request for $4.532 billion for the Limitation on Administrative Expenses. These funds are needed to:

Fund mandatory payroll and other cost increases, which account for about 80 percent of the increase requested for 1992;

Provide a modest increase in SSA's FTE level, to partially compensate for
anticipated workload growth;

Fund costs for our partners in the State Disability Determination Services
whose workloads are expected to increase significantly;

Restore limited funding to maintain and repair our facilities and provide training, supplies and other critical tools our employees need to get their jobs done;

and

Support our computer and telecommunications systems on which we have

come to depend for efficient and reliable service, and continue investments in

automation to offset future workload growth.

Mr. Chairman, the Social Security Administration needs congressional approval of our full $4.532 billion request for administrative costs if we are to fulfill our mandate and serve the public with efficiency, courtesy and compassion.

Payments to Social Security Trust Funds

The fiscal year (FY) 1992 appropriation request for Payments to Social Security Trust Funds totals $40,968,000 and covers four general fund payments to the Social Security trust funds.

Special Payments for Certain Uninsured Persons

The request before this Committee includes $18,868,000 in FY 1992 to reimburse the Old-Age and Survivors Insurance Trust Fund for special benefits paid during FY 1990 to certain uninsured persons aged 72 years and over. The payments are made to individuals who did not have a chance to work long enough under Social Security to become insured. These beneficiaries, a declining population, were not eligible for regular monthly Social Security benefits, primarily because they retired before enactment of the Social Security Act or before their occupations were covered under Social Security.

The FY 1992 request for Special Payments to Certain Uninsured Persons is $6,590,000 less than the FY 1991 appropriation. The population receiving special payments is a closed group of very aged persons which declines annually. As of

September 30, 1990, 7,500 persons were receiving benefits chargeable to the general funds under this provision as compared to 10,000 a year earlier.

Reimbursement for Pension Reform Administrative Costs

Included in this request is a payment of $1,100,000 in FY 1992 to reimburse the OldAge and Survivors Insurance Trust Fund for the general fund share of the cost of administering pension reform responsibilities assigned to the Social Security Administration under Public Law 93-406, the Pension Reform Act. The reimbursement is for the cost of furnishing information on deferred vested pension rights to pension plan participants or their survivors.

The request for FY 1992 reflects the ongoing level of activity for pension reform. It is $400,000 less than the FY 1991 appropriation, which included $400,000 for prior year adjustments.

Unnegotiated Checks

Also included in this request is a payment of $20,000,000 in FY 1992 to reimburse the

trust funds for the value of interest on benefit checks that remain uncashed after

6 months. This payment is authorized by section 152 of the Social Security amendments of 1983 (P.L. 98-21).

The request for 1992 is the same as the FY 1991 appropriation. This amount reflects the ongoing level of activity and represents the value of interest for unnegotiated OASDI benefit checks. Beginning October 1, 1989, Social Security checks, like other Federal government checks, are negotiable for only 12 months from their date of issue under the provisions of the Competitive Equality Banking Act of 1987 (P.L. 100-86). The value of these checks will be credited directly to the trust funds from the general funds when the checks are cancelled. Interest on the amount of unnegotiated checks that remain uncashed after 6 months, until the check is cashed, or until the value of the checks is credited directly to the trust funds, will be funded from this appropriation activity.