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agency established a Chief Financial Officer position over three years ago. Therefore, the CFO's responsibilities and authority for financial management are well established.

The OIG is currently studying two proposals for implementing the financial statement requirements of the CFO legislation. The first proposal is to retain a public accounting firm to perform the review. This proposal will enable the OIG to meet the requirements of the Act without affecting the ongoing oversight responsibilities. This option will require an increase in funds available for contracting support services.

The second proposal is for OIG staff to perform the review. This option will require the OIG to request additional staff to meet the CFO Act requirements, and still effectively carry out ongoing oversight responsibilities, and properly address the priority areas previously discussed.

Staffing Increases

The FY 1992 budget request for the OIG is $10,700,000 and 119 FTEs, an increase of 20 FTEs. What was your original budget request to OMB and how would additional staffing be used?

The Administration's FY 1992 budget request is $7,700,000 and 119 FTEs. Our request was $10,700,000 and 165 FTEs.

We need to provide a credible deterrent against fraud to ensure tax compliance by the nation's railroad employers, and to continue to strengthen our independent oversight of RRB operations. To meet these requirements and to fulfill our mandate, we would distribute additional resources among our three operating entities: audit, investigations, and inspections and analysis.

We have returned $69 for every budget dollar since 1986. To continue this level of achievement, we have requested these additional resources.

Please outline your investigative priorities in FY 1992.

Medicare, Disability, Deceased Payee, Unemployment/Sickness Insurance frauds, and Employee Integrity matters.

What is your expected caseload in FY 1992?

We project in excess of 3,000 cases.

How will the increased activity at the Board to provide additional computer matches impact on the OIG workload?

We anticipate a substantial increase in caseload.

What is your current investigative caseload and how do you expect that caseload to change in FY 1992?

The current investigative caseload is 2,903, and we expect the number to increase to over 3,000 cases.

What will be your audit activities in FY 1992?

We will concentrate our audit efforts in the following priority areas:

--Assisting the Board and monitoring agency progress and use of resources in implementing the contract between the RRB and OMB;

--Non-compliance of payroll taxes by major rail employers;

--Oversight of the RRB trust funds and investment practices;

--Assessment of the RRB's $65 million debt collection program;

--Implementation of financial statement audits;

--Continuing review of the Medicare Part B Program; and,

--Updating the audit universe to ensure adequate planning for our audit coverage of RRB programs.

What are some of the high risk areas that have been identified by RRB management, and what will be the OIG involvement?

Prior Agency reports on internal controls identified a number of material weaknesses in RRB activities, many of which were confirmed by a recent OMB management review. The OMB review listed six specific high risk areas that included: claims processing, debt collection, fraud control, information systems, tax accounting, and trust fund integrity. The Office of Inspector General has agreed to monitor the RRB's five year implementation plan to correct operational deficiencies.

FEDERAL MINE SAFETY AND HEALTH REVIEW
COMMISSION

STATEMENT OF RICHARD V. BACKLEY, ACTING CHAIRMAN

ACCOMPANIED BY:

PAUL MERLIN, CHIEF JUDGE

RICHARD BAKER, EXECUTIVE DIRECTOR
JOSEPH FERRARA, GENERAL COUNSEL

BUDGET REQUEST

Senator HARKIN. The Federal Mine Safety and Health Commission was established as an independent agency in 1977, charged with the responsibility of reviewing the enforcement activities of the Secretary of Labor, and protecting miners against unlawful discrimination. Budget request is $4.7 million, an increase of $530,000 over 1991.

We welcome Richard Backley, Acting Chairman, to the subcommittee. If you would introduce your companions, and then we will put your statement in the record. If you would summarize it, we would appreciate it.

INTRODUCTION OF ASSOCIATES

Mr. BACKLEY. Thank you, Senator Harkin. It is good to see you again.

To my immediate right is our chief judge, Paul Merlin, on my immediate left is Richard Baker, our Executive Director, and to my far left is our General Counsel, Joseph Ferrara. I will attempt to make this brief, because after all the statement is only 21⁄2 pages. I think there is a certain brevity in that.

As you pointed out, Senator, we are asking for an additional $530,000 which basically is to fund an anticipated increase in our workload which results from certain activities of the Labor Department's Mine Safety and Health Administration.

Because it has been previously discussed this morning, I would like to point out, Senator, that the average case before the Commission is approximately 6 months old, while the average case decided by our administrative law judges is approximately 180 days old. However, in the last 5 months we have noted an increase in cases coming into the Commission.

We attribute this to two factors: one is a pattern violation and the other is the excessive history issue, both of which are currently being prosecuted vigorously by the Secretary of Labor.

We needed an additional administrative law judge this year, but the executive and administrative law judge pay raise depleted our resources as we have 17 people who were covered by the increases.

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PREPARED STATEMENT

We need an additional administrative law judge in fiscal year 1992. Additionally, the General Counsel needs another member on his staff, so that our case inventory will not continue to grow. When the Commission began in 1978 we had a horrendous backlog, and I think we have successfully brought it down.

I would be glad to respond to any questions you have for me. [The statement follows:]

STATEMENT OF RICHARD V. BACKLEY

Mr. Chairman and members of the committee, it is a pleasure to appear before the committee again in support of the 1992 fiscal year budget request of the Federal Mine Safety and Health Review Commission. As a word of introduction, I have been a Commissioner since the inception of the Commission in September 1978 and have served as Chairman or Acting Chairman on three separate occasions during my tenure.

The Federal Mine Safety and Health Review Commission exists to objectively and neutrally adjudicate through administrative trial and appellate review legal disputes arising under the Federal Mine Safety and Health Amendments Act of 1977 among or between mine operators, the Department of Labor, and miners.

This five-member Commission provides administrative appellate review. Its functions include reviewing all administrative law judge decisions, ruling on petitions for discretionary review, directing review sua sponte for cases that may be contrary to law or policy or that may present novel questions of policy, and issuing decisions that affirm, modify or vacate administrative law judge decisions directed for review. If not considered for formal review, an administrative law judge decision becomes a final non-precedential order of the Commission. Appeals from final decisions of the Commission are to the U.S. Courts of Appeal.

In the activity of Administrative Law Judge Determinations, we have received 1,122 new cases during the first 5 months of this fiscal year. This rate, if continued, will exceed the 2,175 new cases estimated for fiscal year 1991. Case dispositions for 1991 are expected to total 1,970. Should this rate continue we would begin fiscal year 1992 with an increased inventory of 1,997. In fiscal year 1992 we expect to receive 2,349 new cases and dispose of 2,165 cases, leaving a case inventory at the end of fiscal year 1992 of 2,181. (This is 513 cases above the estimate provided in the President's budget.)

During fiscal year 1990, 2,029 new cases were received and 1,930 cases were decided. Of these dispositions, 943 were disposed of prior to hearing by settlement approved by the administrative law judges, 691 were disposed of on motion or by stipulated record, and 296 were fully tried prior to decision. At the close of the year the pending caseload before the judges totaled 1,279.

At the Commission Review Level we expect to receive 92 new cases for formal review and dispose of 79 cases leaving an ending inventory of 49 cases for fiscal year 1992. In addition, the Commission will continue to review administrative law judge decisions. In fiscal year 1991, we expect to receive 75 new cases and dispose of 67. In fiscal year 1990 the Commission received 80 new cases and issued 59 substantive decisions and denied 19 petitions on review for a total case disposition of 78. The average age of the 59 substantive decisions in fiscal year 1990 was 7.4 months. The Commission attempts to hold as many meetings as possible in open session and of the 26 meetings held in fiscal year 1990, 12 were open, 3 were closed and 11 were partially closed and partially open.

Over the past several years we have seen a steady increase in our workload of new cases. While the disposition of cases has increased, our inventory of unresolved cases has continued to grow. As a result we are requesting funding for four additional FTE including an administrative law judge.

The fiscal year 1992 request of $4,719,000 is an increase of $530,000 which is needed mainly to support this added staff and to cover general pay increases for the Commission's employees.

Thank you for the opportunity to present this statement, Mr. Chairman. I would be pleased to respond to questions from you and members of the Committee.

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