note that as of the date of the draft report, NBS
had not requested assistance from OMB in resolving
this problem. The Department expects that with OMB's
assistance, a resolution of the Nuclear Safeguards
Program's funding will be reached prior to release of
this report.
We believe that if this item is to be
included, a fuller explanation of the situation is
needed.

Page 10 paragraph 1 - Recommend substituting the following
paragraph for the one included in the report. "The
severe curtailment of this program could affect the
Nation's nuclear safeguards program becuase certain
NBS standards and methodologies that would have been
available for use in the nuclear materials accountability
arena will not be developed. Without these standards
and methodologies, the decision-making process for
nuclear materials safeguards will be based on data
which has not been validated against national
standards. Finally, the investment of $3.6 million by
NCR to date will be less useful than it could be
because the initial work will not be implemented in
standards and methodologies."

Page 10 paragraph 2- The citation for the Energy Policy and
Conservation Act should be P.L. 94-163.

Page 12 paragraph 1 - Recommend that the following be substituted for the first three sentences of the paragraph, "In May of 1978, EPA and DOC established a interagency agreement delineating the responsibilities of each under the legislation. The Congress also provided authorization for appropriation for this program at NBS in P.L. 94-580. OMB recommended $3,122,000 for this program in the 1980 President's budget. NBS had previously reprogrammed approximately $1 million of funds during 1979."

Also, Recommended that the end of the last sentence be
revised to read "...begin 2 years after enactment."

Page 13 paragraph 1 - Recommend that the description of the negative impacts of the implementation of the lead agency concept be balanced with a description of OMB's commitment toward the building of competence at NBS. Suggest the following as the last lines of the section: "However, it is noted that OMB established a competence fund at NBS in 1979 intended to enhance the capability of NBS to respond to the needs of other agencies requiring the services of NBS in meeting their respective objectives. NBS was further directed to reprogram from within their base level of resources similar amounts to the competence fund to enhance their capability for meeting NBS specific objectives. This fund is to be used for the development and upgrading of the various scientific and technical disciplines necessary for the performance of NBS work." These funds are not to offset the costs of performing other agency work, but to improve the NBS capability to perform the necessary support.

APPENDIX XI

Changing

APPENDIX XI Page 16 paragraph 4 The Department believes the recommendation will not accomplish the purpose intended by GAO. the word "authorized" in the NBS Organic Act to the word "shall" would not affect statutory authorities of other Departments and agencies making those agencies responsible for the conduct of a mission. Even if Congress in another agency's legislation clearly directs the Secretary of Commerce through the Bureau of Standards to perform a particular task comprising part of that other agency's overall mission, appropriations for the task must be authorized to the Secretary, the President's budget must request such appropriations, and the Congress must actually appropriate the monies.

We suggest that GAO revise its recommendation in accordance with the above.

Page 23 Recommend that the following substitutions be made:
First paragraph be replaced with:

GAO note:

"The Assistant Secretary for Science and Technology
directed NBS to develop a plan to refocus its base
program funding levels in order to accommodate new
high priority work. Since the Department was attempting
to propose a budget within the President's fiscal
policies, it was necessary to focus resources available
within those policies to the highest priority programs.

Second paragraph be replaced with:

"NBS and Commerce officials felt that although the
programs selected for curtailment or termination were
viable, they were of a lower priority and lesser
urgency when compared to proposed new programs.
Additionally, it was felt that most of these projects
had matured to a point where further research, if
necessary, could be picked up by other institutions."

In the third paragraph substitute "terminated" for
"reprogramming" as the seventh word of the fifth line.
The page numbers referred to in the attachments
do not correspond with the page numbers in this
report. Certain revisions were made where appro-
priate. We rechecked the data supporting our
disclosures and in some instances made no change
because the Department of Commerce's information
was not supported by factual data. For example,
the employment figures furnished by Commerce
differ from those appearing on the NBS computer
run which we used in the report. Another example
is that the comments received from EPA negated
the Department of Commerce's comments regarding
this agency. In general, many of the comments
furnished were minor or editorial in nature,
which did not require us to make any substantive
changes to the report.

EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET

WASHINGTON, D.C. 20503

DEC 26 1979

Mr. Allen R. Voss

Director, General Government Division

General Accounting Office
Washington, D.C. 20548

Dear Mr. Voss:

This letter responds to your request for comments on Chapter 2 of the draft proposed report, "National Bureau of Standards--Information for use in Reauthorizing its Activities." Our comments address the general concept of a lead agency, the specific examples which you have used in your report, and the recommendations made to OMB and the Congress.

Lead Agency Concept

First, some clarification should be made of the term "lead agency." We have applied this term to agencies and Departments that are commonly considered mission agencies, such as the Departments of Transportation, Housing and Urban Development, and Defense. While NBS' "mission" could be said to be in the field of measurement science its activities are divided between those of general applicability (in which NBS does have the lead) and those of specific applicability (where the agency with the specific program has the lead). Therefore, although NBS is the "lead agency" in general measurement science, it is not the "lead agency" when it comes to applying that science to projects in other agencies: it is a supporting agency.

In addition to the points raised in the report, the lead agency policy serves two important functions:

1.

2.

it encourages the mission agencies to give more thought to their long-range research needs and to work closely with NBS to identify and meet those needs; and

it enables NBS to concentrate its directly appropriated funds on basic research in metrology and on the development of the underlying data base which can then be applied to meet other agencies' needs. OMB has supported this work by funding a base program in various measurement areas and by approving establishment of a "competence fund" which NBS uses to do fundamental research in areas where there is a foreseeable demand for their scientific expertise in the future.

APPENDIX XII

APPENDIX XII

2

the primary purpose of this fund is to allow NBS to remain at
the forefront of scientific research, the fund has the
secondary effect of enhancing NBS' capability to respond to
the mandates of the Congress and to the needs of other
agencies.

One final point should be made with respect to this general concept.
The draft states (pg. 6) that OMB has adopted the policy that an agency
should be the "exclusive" source of support for its mission. It would
be more accurate to say that the lead agency should be the principal or
primary source of support.

Specific Examples of the Lead Agency Concept

The application of the lead agency funding policy has worked quite well
in a number of cases, none of which have been cited in the draft
report. Solar energy research and consumer product safety work are two
areas. With respect to the examples described in the report, we have
the following specific comments.

Environmental measurements program

It is clear from the discussion of this program, and from our
conversations with EPA officials, that no one from EPA was
consulted in the preparation of this section of the report.
The material reflects no knowledge of EPA's position on a policy
matter in which they obviously have an important interest. We
find that the omission of this agency's views in the discussion
of the interagency agreement has resulted in several factual
errors in the report.

First, during the first year of implementation, OMB worked
closely with both EPA and NBS to assure that the research
program that was agreed upon would meet the needs of EPA while
providing some measure of continuity to NBS' existing program.
The statement indicating that EPA's requirements "provided no
consideration for ongoing programs at NBS to develop fundamental
understanding, analytical methods, and reference samples for
environmental measurements" does not acknowledge the fact that
the final program that was agreed upon provided for continuation
of much of NBS' ongoing work. Nor does it acknowledge the fact
that EPA ultimately provided NBS with $1.7M in FY 1979 to
conduct the agreed upon program.

Secondly, the report states that "starting with the fiscal year
1979 budget, essentially all of the NBS direct funding for
environmental support was removed by UMB from the NBS budget."
This statement ignores the fact that the President's budget has

APPENDIX XII

3

included funding for NBS which would maintain a basic
competence in the environmental measurements area, thereby
enabling NBS to respond on a reimbursable basis to requests for
assistance from EPA and other agencies.

Finally, while we acknowledge that some "dislocation" of NBS work occurred in 1979 as a result of the delay in funding, we would also point out that this was the first year of implementation of a new policy. Some disruption can be expected initially, but we would argue that, in the longer range view, the lead agency policy will provide a more effective means of establishing research priorities in the environmental area.

Appliance labeling program

As GAO points out, the appliance labeling program was made mandatory by legislation which directed the Federal Energy Administration to have work performed by NBS. The Congress gave the Federal Energy Administration overall responsibility for this effort, and authorized FEA to transfer funding to NBS for its work. While separate funding was not requested directly for NBS in the President's budget for 1978, the necessary funds were requested as part of the Federal Energy Administration budget as authorized by the Energy Policy and Conservation Act (P.L. 94-163). The necessary positions were reallocated within NBS to perform this work on a reimbursable basis.

Resource recovery program

The question of funding for the resource recovery program is
also only partly related to the lead agency concept.
Throughout the development of program plans for implementation
of the Resource Recovery and Conservation Act, OMB has been
concerned that all agencies with responsibilities under the Act
coordinate their activities to develop programs that are
complementary and not duplicative. Funding for NBS was
initially denied, therefore, not on the basis of lead agency
responsibility but because of the lack of a Government-wide,
coordinated approach to the resource recovery issue. NBS' 1979
reprogramming request was allowed by OMB and direct NBS funding
of $3.1M for the resource recovery program was requested as
part of the President's budget in 1980. Thus, implementation
of the NBS program began about 2 1/2 years, rather than 4
years, after passage of the law.