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will set the "tone" for the agency in terms of where we would like to be as we enter the 21st century. The ASP will "frame" these and other issues in a way that agency management and our higher monitoring authorities can more reasonably assess the relative costs and benefits of varying levels of service, technological staffing trade-offs and related budget-sensitive issues. On balance, the ASP commits SSA to an ongoing process of change management and public accountability that will translate into plans and budgets that relate to a clearly articulated plan for the future.

Question. Do you expect this plan to be of help in alleviating pressure on extremely tight fiscal 1992 resources?

Answer. I do not expect a direct relationship between the agency strategic plan and the FY 1992 budget. However, I expect some of the ideas and approaches comprising the strategic plan, will help us to do the best we can with limited resources over the next few years.

The Agency Strategic Plan should be available by summer of 1991. This plan will form the basis for more detailed planning at lower levels. It is at these levels where specific initiatives designed to reach the vision, e.g., increased productivity, will be planned and budgeted for in accordance with prevailing public policy.

$375 MILLION INCREASE FOR SOCIAL SECURITY OPERATIONS

Question. The domestic discretionary cap increases by about 5.5 percent in fiscal 1992 compared to fiscal 1991. You are requesting a $375 million increase in budget authority for Social Security administrative expenses in fiscal 1992. That is a 9-percent increase, more than requested for many other programs. However, on page 93 of your justification, you state "we do not expect the Social Security Administration will be able to improve materially its service levels during the budget period; and, in some cases we may see the number of cases pending increase and processing times grow."

With a 9-percent increase in budget authority in fiscal 1992, why can't the Social Security Administration materially improve its service levels and take steps to reduce pending workloads and processing times?

Answer. Because of the magnitude of SSA's mandatory cost increases, such as pay raises, pay reform, rent and postage increases--which account for 80% of the increase--and expected workload increases--primarily disability workloads and work related to implementation of the Omnibus Budget Reconciliation Act of 1990, this increase in budget authority is not enough to enable SSA to improve materially its service levels in FY 1992.

PROPOSED USE OF THE $375 MILLION

Question. What will the $375 million requested increase be used for? What are we getting for the 9-percent increase?

Answer. Although this increase may appear to be substantial under the new budget rules for discretionary domestic spending, it is a conservative request given the magnitude of SSA's built-in mandatory cost increases and the amount of work to be done.

$292 million or almost 80 percent of the $375 million increase is for the following mandatory increases:

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$202 million is needed for mandatory payroll cost increases, including step increases, promotions, 1992 Federal pay raise, full-year cost of the 1991 pay raise, pay reform and the Federal share of employee health benefits;

$44 million is required for mandatory rent, postage and HHS working capital fund increases and payments to attorneys under the Equal Access to Justice Act;

$22 million is needed to maintain current operations for
information technology systems; and

$24 million in increased State salaries and overhead for the Disability Determination Services (DDSs).

Another $62 million is for other built-in increases for service contracts, medical and other costs for the DDSs, and to restore funds for supplies, printing, repairs and employee training that had been deferred.

Finally, the net of all other increases and decreases from the 1991 appropriation level amounts to $21 million.

STAFFING

Question. I am glad to see you requested an increase in staffing after so many years of downsizing. What impact did downsizing have on the Social Security Administration?

Answer. Under SSA's 6-year downsizing effort, full-time equivalent employment declined from 79,961 in 1984 to 62,836 in 1990. Since then we have focused on stabilizing our workforce and assessing our position in the aftermath of the reduction. Have we reduced too much in some areas? When we look at the data for this period, we find both successes and areas that need to be addressed.

Despite downsizing, pending workloads in many key areas dropped significantly between 1984 and 1990. Two noticeable exceptions are the number of SSI claims filed by the disabled and our hearings caseloads. On the other hand, Social Security number cards are issued much more quickly and, thanks in large measure to our claims modernization effort, processing times for retirement claims are down by one-third from 1984. Processing times for most other workloads have increased somewhat and we have staffing imbalances in some areas.

The Agency Strategic Plan, to be published this summer, will identify the desired level of service to be provided to the public and will guide us in developing shorter-term tactical objectives. The results of this effort will, among other things, enhance SSA's

ability to evaluate the performance of field offices and the allocation of staff resources.

Question. Your budget indicates that the additional staff will be used for higher disability workloads and new legislative requirements. Does this suggest that disability work is your top priority?

Answer. The disability area is the one area in which the volume of applications filed as a result of higher filing rates, new legislation, the Zebley court decision and our SSI outreach efforts exceed our ability to keep pace with this workload. Because of significant growth in this area, I would assign high priority to using any additional funds to process these claims and curtail the rate of growth in the pending workloads.

SSI OUTREACH ACTIVITIES

Question. The 1990 appropriations included $3.5 million for outreach activities, and the 1991 appropriation added an additional $6 million for this activity. The Congress intended these funds to be used primarily for projects targeted to areas with high levels of non-participation in the SSI program including rural areas. have asked for only $3 million in 1992, half the current level. What are your plans for using the $6 million for outreach activities in 1991 and the additional $3 million in 1992?

You

Answer. Before we spend $6 million in FY 1991 we want to make sure we are funding projects that are likely to succeed. We are reviewing the proposals we received in response to our FY 1990 grant announcement, with an eye toward what we have already learned from our FY 1990 experience.

Once I am satisfied we will get meaningful results, we will fund new cooperative agreements to target needy populations with high levels of nonparticipation in SSI and in areas of limited accessibility due to rural location or language barriers.

We also are exploring what can be done to deliver truly integrated services with other Federal agencies that provide services to the needy, to develop models of outreach to underserved populations.

Some of the $6 million appropriated for FY 1991 will be used as requested by this Committee for an independent evaluation of outreach, to determine the outreach approaches most effective in addressing the barriers to participation in the SSI program.

Our FY 1992 request includes $3 million to fund additional SSI outreach demonstration projects and to support fully the existing cooperative agreements.

INDEPENDENT EVALUATION OF OUTREACH

Question. When will you award a contract for the independent evaluation and when do you expect to see the results of that evaluation?

Answer. The Committee directed that SSA use no less than 5 percent -- $300,000--of the $6 million appropriated for outreach for an independent evaluation of the effectiveness of various outreach methods.

We are exploring options for obtaining an independent evaluation and expect to have an agreement this summer. As a precursor, we also plan to validate our project evaluation strategy via a separate preliminary review.

The duration of the project is controlling as to when evaluation results will be available. The first SSI outreach

demonstration projects were awarded at the end of September 1990. The initial results from the projects of shortest duration will not be available for study until December 1991. We will need an ongoing evaluation agreement so the results of the later projects may be factored into the analysis. Projects awarded in FY 1991 will begin later this year, and the results of those projects will not be available for analyzing until sometime in FY 1993.

We hope to have an interim evaluation report on the first group of completed projects in April 1992, 3 months after the grantees' final reports are due to SSA. We anticipate having the evaluation results updated at the close of every major group of projects, and we should receive the final report within 3 months after the end of the last project.

We are doing ongoing monitoring of results ourselves, and we will have preliminary data available for decision making regarding funding of FY 1991 and FY 1992 activities.

DELAYED OBLIGATION OF FUNDS

Question. Your budget includes bill language to withhold $80 million from obligation until September 19, 1992--just 12 days before the end of the fiscal year. Would this delayed obligation of funds be limited to computer and other equipment costs, or are you considering holding back on staffing costs?

Answer. If the full request is enacted, we intend to meet the planned full-time equivalent levels during FY 1992; therefore, the budget estimates assume no delay in obligations for personnel

expenses.

Question. How much money is normally not obligated until the last 12 days of the fiscal year?

Answer. About $73.4 million of obligations were incurred during the last 12 calendar days of FY 1990. This includes $70 million of payroll costs for the 8 work days that fell during the last 12 calendar days and $3.4 million for other objects.

CENTRAL COMPUTING STRATEGY

Question. I understand that the Social Security Administration (SSA) currently processes all claims data through a computer system at the National Computer Center (NCC). field offices are dependent on this mainframe computer,

All of your and no

claims can be processed in the event of an NCC disaster until the system is restored or replaced.

According to a recent Inspector General report, there is a significant danger in relying on this type of centralized computer system. SSA's own 1982 Systems Modernization Plan stated that should a major disaster occur at the NCC, "untold billions of dollars could be lost as a result of SSA'S computer and communications systems being out of commission for up to a year."

What plans do you have to upgrade the agency's computer architecture so that there is an adequate back-up system in an emergency?

Answer. A contractor has prepared a cost-benefit analysis on different alternatives that would provide a second data center for SSA with sufficient computer processing capabilities to process SSA's most critical payment-related workloads in an emergency. This analysis is under review and decisions are expected in several months.

SETTING PRIORITIES

Question. You are proposing a $30 million increase in automation activities, at the same time that large backlogs are building up in disability claims, and the public is getting busy signals when it calls your "800" number. Why shouldn't some of these automation investments be postponed, until basic services to the public are under better control?

Answer. The thrust of the additional $30 million in information technology systems investments will improve the levels of service to the public. Further automation and modernization in activities such as hearings and Supplemental Security Income will enable SSA employees to keep up with growing workloads and process applications in a more timely and accurate manner.

Improvements to the "800" number telephone network will also reduce busy rates and queue time. Such improvements include a remote management center to consolidate all "800" number management information to permit faster reaction to traffic bottlenecks; upgrade of automatic call distribution equipment; and expansion of telephone service to support additional answering positions so that the "800" number will be able to handle more calls with available teleservice operators and, thus, give better access to the public.

INFORMATION TECHNOLOGY SYSTEMS

Question. Several years ago funds were earmarked specifically for automated data processing and telecommunication activities. In 1990, the Congress approved the Social Security Administration's request to rescind the earmark in order to provide the Social Security Administration with more flexibility to allocate resources to automated data processing and telecommunication activities within the total amount appropriated. Now you are asking tha minimum floor of $260 million of the amounts from the LAE acc be made available for these activities in 1992.

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