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DEPARTMENTAL ADMINISTRATION Chaimman HATFIELD. Assistant Secretary Hesse, do you wish to make your statement? Your full prepared statement will be incorporated in the record. I believe you are submitting some statements on behalf of other offices in the Department as well. Ms. HESSE. Yes, sir.
SUMMARY STATEMENT Mr. Chairman, I do appreciate the opportunity to appear before you today in support of our fiscal year 1987 budget request. I would like to submit my prepared statement for the record, as well as the separate statements detailing the requests of the six remaining major organizations under “Departmental administration.”
I think that during the last year, we have implemented a number of management improvements that are aimed at increasing both the administrative and fiscal efficiency and effectiveness, and some of the accomplishments that we have been able to achieve are sort of firsts for the Government. I would just like to name a couple of them.
We have a consolidated payroll and personnel system which now supports 95 percent of the field offices. We also have a departmentwide integrated and standardized core accounting system. Both of these systems, by the way, are goals of this administration in improving efficiency and effectiveness of the executive branch, and the Department of Energy is the very first organization to achieve those goals.
I think that the fiscal year 1987 budget authority for these activities is slightly more than $315 million. This includes $155 million for salaries and related expenses; $133 million for support services and capital equipment; plus $16 million for the In-House Energy Management Program and $11 million for the Technical Information Management Program.
The overall staffing and program level for these support activities under the “Departmental administration” account is essentially the same as reflected in fiscal year 1986. I think that in the interest of time, that will conclude my presentation.
I would be pleased to answer any questions you may have. (The statements follow:) STATEMENT OF MARTHA O. HESSE, ASSISTANT SECRETARY FOR MANAGEMENT AND
ADMINISTRATION, DEPARTMENT OF ENERGY Mr. Chairman, members of the subcommittee, I am Martha 0. Hesse, Assistant Secretary, Management and Administration, of the Department of Energy. I appreciate the opportunity to appear before you today in support of the fiscal year 1987 budget request for the departmental administration appropriation, and for the Technical Infor
mation Management Program and the In-House Energy Management Program requested in the energy supply research and development appropriation.
The fiscal year 1987 budget authority for these activities is $315.3 million. This includes $155.1 million for salaries and related expenses, $132.9 million for support services and capital equipment, $16.5 million for in-house energy management, and $10.8 million for the Technical Information Management Program. In addition to these ac tivities, $115.1 million is requested for the Cost of Work for Others Program, which will generate $143.4 million in revenues. An additional $108.5 million in other revenues will be generated from the sale of incidental byproducts.
My testimony on departmental administration will cover management and administration, the Office of the Secretary, five multipurpose operations offices, and the financial accounts of Cost of Work for Others Program, and miscellaneous revenues. Under the energy supply research and development appropriation, I will discuss the In-House Energy Management Program and the Technical Information Management Program. Although I have given you the total funding levels requested for departmental administration, separate statements detailing the requests of the remaining six major organizations under the departmental administration appropriation will be submitted for inclusion in the record. These organizations include General Counsel, Inspector General, the Office of Minority Economic Impact, the Office of Policy. Planning and Analysis, the Assistant Secretary for Congressional, Intergovernmental and Public Affairs, and the Assistant Secretary for International Affairs and Energy Emergencies.
ACCOMPLISHMENTS During the past year, we have implemented a number of management improvements aimed at increasing administrative and fiscal efficiency and effectiveness: • The Department's personnel and payroll system [PAY/PERS) has been expanded
to support 95 percent of the field offices, with full implementation to be completed by July 1986. In addition, we are currently providing personnel system support to several outside agencies—the Inter-American Foundation, the African Development Foundation, the Occupational Safety and Health Review Commission,
and the Office of the Federal Inspector for the Alaska Pipeline. • The DOE-wide departmental integrated standardized core accounting system
(DISCAS) was successfully implemented. This is a major step in working toward the administration's objective of implementing within each agency a uniform accounting system to improve the quality, integrity, and timeliness of financial in
formation • An Automated Office Support System Training Program was established which
covers the full range of microcomputer software products supported at headquarters. Also, a training center was established to accommodate microcomputer, word processing, and all other ADP training for headquarters' personnel. Over 3.300 employees attended these courses in fiscal year 1985. The Department has successfully negotiated pension language in the contracts of most operating contractors to ensure that upon termination of the contracts, excess
assets will revert to DOE after contract pension obligations have been satisfied. • Goals were established for the timely closeout of inactive contractual instruments.
These efforts resulted in contract closeout of more than 6,800 instruments. These
vironment, to authorized users on a nationwide basis utilizing encrypted and secure voice equipment.
MANAGEMENT AND ADMINISTRATION Management and administration provides the essential management and institutional systems and services necessary to support the Department's programs and missions. A major goal of management and administration continues to be the reduction of administrative overhead and the promotion of increased efficiency and effectiveness in management, administrative, and financial support systems and services. The fiscal year 1987 program request of $146.1 million for management and administration includes funding for employee salaries, benefits, and travel for the Office of Administration, the Office of Controller, and the Procurement and Assistance Management Directorate. The request also includes support service costs for headquarters employees. Of the $146.1 million requested in fiscal year 1987, $49.1 million is for salaries and benefits for 1,117 full-time equivalents and $2.5 million for related travel. The support services request of $94.5 million includes items such as space rental, supplies, transportation, communications, computer systems, printing, and the purchase of capital equipment. It should be noted that S6 milion of management and administration's request will be financed by prior-year deobligations, resulting in a budget authority request of $140.1 million.
OFFICE OF THE SECRETARY The request for the Office of the Secretary includes $1.9 million for salaries, related expenses, and travel costs to support 31 full-time equivalents.
OPERATIONS OFFICES Five of the eight operations offices are multipurpose and are, therefore, funded within the departmental administration appropriation. These are Chicago, Idaho, Oak Ridge, Richland, and San Francisco. Of the $94.2 million requested in fiscal year 1987, $66.8 million is for salaries and benefits for 1,601 full-time equivalents, $1.9 million for travel expenses, and $25.5 milion for space rental, utilities, supplies, transportation, communications, related support services, and capital equipment. These five multipurpose operations offices support research and development activities through contract administration and day-to-day management oversight of Government-owned, contractoroperated facilities; design, engineering and construction management; procurement; property and real estate management; contractor industrial relations; financial management; and management of related support services. The other three operations offices primarily support defense activities and are funded by the atomic energy defense appropriations. These are Albuquerque, Nevada, and Savannah River.
COST OF WORK FOR OTHERS AND MISCELLANEOUS REVENUES Cost of work for others covers expenses for products and services to non-DOE organizations when such products or services are not generally available from alternate sources. Examples of such products and services include special reactor materials, isotopes, and irradiation and test reactor services. The fiscal year 1987 estimate is $115.1 million. The Department will receive an estimated $143.4 million in associated revenues as reimbursements for this work. Miscellaneous revenues estimated at $108.5 million are also earned from the sale of byproducts, such as reactor steam and reprocessing irradiated fuel.
IN-HOUSE ENERGY MANAGEMENT The fiscal year 1987 request for in-house energy management is $16.5 million. The requested amount reflects a continuing investment to improve the energy efficiency of DOE buildings, facilities, and processes through quick payback projects. The program of retrofits proposed for fiscal year 1987 has a payback period of 2.2 years and a rate of return on investment of over 35 percent.
These retrofit projects reduce utility costs in the outyears for all DOE programs at the affected sites. The In-House Energy Management Program is centrally managed, which enables the Department to maximize the return on investment by competing projects DOE-wide on the basis of return on investment. The proposed funding also continues energy conservation surveys to identify future retrofit projects; central plant studies to evaluate the economic feasibility of cogeneration of electricity and other central plant improvements; and model energy conservation programs such as a Steam Trap Improvement Program for the Department's central steam distribution systems, and a boiler operator training program.
TECHNICAL INFORMATION MANAGEMENT PROGRAM The Technical Information Management Program is a centralized scientific and technical information resources management function for the Department's program managers and contractors. The major responsibilities of this program are: (1) The development of specific DOE-wide policies, procedures, and guidelines for the management of DOE's scientific and technical information; (2) oversight and program evaluation responsibility to ensure that R&D information resources are effectively managed; (3) the management of an international program to allow the United States to capitalize on the availability of technical information generated through other nation's energy research and development; and (4) management of the Technical Information Center, DOE's centralized scientific and technical information facility. The fiscal year 1987 budget request for the Technical Information Management Program is $14.7 million, which includes $13.8 million for operating expenses and $0.9 million for the purchase of capital equipment of this $14.7 million, it is proposed that $3.9 million will be reprogrammed from prior year unobligated authority, resulting in a budget authority request of $10.8 million. This request includes support for 175 full-time equivalents.
Mr. Chairman, that concludes my presentation. I will be happy to respond to any questions you or the subcommittee members may have.
STATEMENT OF JOHN C. LAYTON, INSPECTOR GENERAL, DEPARTMENT OF ENERGY
RESPONSIBILITIES The statutory responsibilities of the Inspector General, as stated in section 208 of Public Law 95-91, the Department of Energy Organization Act, are to detect and prevent fraud and abuse and to promote economy and efficiency in the programs and operations of the Department of Energy (DOE). These programs encompass the work of over 16,300 employees of the Department, 130,500 DOE contractor employees at Government-owned, contractor-operated facilities, and the activities of other contractors and grantees of the Department
The Department of Energy is a complex and multimissioned Department with pro grams varying from the assembly of nuclear weapons to the funding of low-income weatherization projects. Further, the Department is second only to the Department of Defense in the dollar amount of its procurement activity. Thus, the audit, inspection, and investigative requirements of DOE are extensive and varied.
ORGANIZATION-AUDITS, INSPECTIONS, INVESTIGATIONS The Office is organized in three divisions with three Assistant Inspectors General. The Office of Audits performs all internal audits for the Department. The Office of Audits conducts financial and compliance, efficiency and economy, and program results audits. The Office of Investigations is responsible for the detection and prevention of fraud and abuse. The Office of Inspections is responsible for reviewing and evaluating DOE's scientific and technical programs and operations. In addition, an Office of Executive Director performs administrative, personnel, policy, planning, and manage ment information functions for the Inspector General.
The field structure for the Office of Audits is composed of an eastern (Oak Ridge) and western (Albuquerque) regional office with Il satellite offices, and the Capital regional office, located in Germantown, Md. The field structure for the Office of Investigations is composed of regional investigative offices at Oak Ridge and Albuquerque with nine satellite offices. This organization places at least one investigator at each of the Department's operations offices.