Statement of Anne F. Thomson Reed

Chief Information Officer

United States Department of Agriculture

Before the Senate Committee on Agriculture,

Nutrition and Forestry

May 14, 1998

Mr. Chairman, Senator Harkin, and members of the Committee. I want to thank you for inviting me here today to discuss how USDA is preparing to meet the challenge of the Year 2000 Problem. I would like to introduce to you two of the key USDA players who are addressing the Year 2000 challenge and attending today's hearing. Joining me are Ira L. Hobbs, Deputy Chief Information Officer for USDA, and Dr. Gregory Parham, Year 2000 Program Executive for USDA, who leads the overall departmental team addressing Year 2000 issues.

Secretary Glickman has made addressing the Year 2000 problem a top priority for the Department. Last year, the Secretary instituted a series of strong management controls, such as the creation of the Year 2000 Program Office led by Dr. Parham, to respond to the risks posed by Year 2000 to USDA internal systems. This bold action has begun to pay off, and the Department is demonstrating real progress in our Year 2000 efforts. However, we know that we must stay focused to sustain this effort within the Department. Additionally, we must extend our outreach to our constituent groups -- farmers, ranchers, rural communities, and agri-business-- to increase awareness and understanding potential Year 2000 problems which need to be corrected.

I have been involved in addressing the Year 2000 problem since I began my tenure as Chief Information Officer on August 8, 1996. I am the Department's representative on the President's Council on Year 2000 Conversion. I also serve as a member of the Chief Information Officers Council Year 2000 Policy Group, working with state governments. Dr. Parham represents the Department on the Chief Information Officers Council Year 2000 Committee. By interacting with the other Chief Information Officers and the members of the President's Council, I have been able to bring to USDA new perspectives and strategies for dealing with the Year 2000 problem.

As proud as we are of our efforts on Year 2000, we are far from satisfied. There is much more work to do over the next nineteen months to get our systems prepared for the new millennium. Secretary Glickman has stated emphatically that we owe it to the families and farmers who rely on the Department's work to ensure that every mission-critical system is ready for January 1, 2000, and we are well on our way to achieving this goal.

USDA Year 2000 Program Management

USDA has taken a strong approach to respond to the challenges of Year 2000 remediation throughout the Department. In the past year the Secretary has taken several steps to strengthen program management for Year 2000 conversion.

First, the Secretary established a Year 2000 Program Office with Senior Executive Service leadership to manage Year 2000 issues Department-wide. The Chief Information Officer and Program Executive have been assigned oversight responsibility for ensuring that all of USDA's mission-critical systems are Year 2000 compliant by the end of March, 1999.

Second, the Secretary directed each agency administrator to appoint a Year 2000 senior executive, who serves as the agency's executive sponsor reporting directly to the administrator, and has established Year 2000 project teams. Year 2000 is a critical element in the performance standards of the executive sponsors and project managers in order to establish accountability.

Third, the Secretary tightened the procurement moratorium requiring the Chief Information Officer's approval of any information technology procurement over $25,000. I have sole signatory authority under the moratorium, which will remain in place throughout FY 1998 and FY 1999 to assure that the Year 2000 is the Department's information technology priority. At present, the Department plans to spend over $120 million to address the Year 2000 problem.

Our management actions have shown positive results. We still have work to do, but we are on track.

STATUS OF THE USDA YEAR 2000 REMEDIATION EFFORT

USDA is giving high priority to Year 2000, consistent with our goal of continued successful administration of farm policies and programs essential to the vitality of agricultural producers and rural communities in the United States. USDA is implementing the five phases of Year 2000 conversion as outlined by the General Accounting Office in its report "Year 2000 Computing Crisis: An Assessment Guide", which covers awareness, assessment, renovation, validation, and implementation.

Awareness

The Year 2000 Program Office is organized to address the broad spectrum of Year 2000 activities throughout USDA. Program managers give leadership in the areas of information technology systems, telecommunications systems, vulnerable systems and processes, and data exchange issues. Program managers work individually and collectively with Year 2000 conversion staff in each agency to raise awareness, monitor progress and exchange ideas.

USDA has instituted regular monthly meetings of agency senior executive sponsors to address policy issues related to Year 2000 conversion. The agency Year 2000 project leaders also meet on a monthly basis to identify technical issues, share information and discuss potential solutions. The Vulnerable Systems and Processes Work Group meets twice a month to address issues with embedded systems in buildings, facilities, scientific and laboratory equipment. In addition to the regular meetings, each agency submits a monthly report on Year 2000 progress to the Year 2000 Program Office for review. The Year 2000 Program Office has also established a website with links to information about the USDA Year 2000 Program, contact information, current status reports on mission-critical systems and other Year 2000 resources.

USDA has expanded its awareness phase to include a major outreach initiative to rural America. Working with state and local groups, this outreach initiative will be adapted and tailored for USDA customers and interest groups.

Assessment

We completed the assessment of USDA's mission-critical information technology systems in November of 1997. We are currently tracking 1,080 of these systems for Year 2000 compliance. Of that number 430 (40%) are already compliant, 271 (25%) are being replaced, 317 (29%) are being repaired and 62 (6%) will be retired.

I should point out that not all systems are of equal size. Some are quite large, such as the Processed Commodities Inventory Management System with 2,500,000 lines of COBOL code, while others are much smaller. Regardless of size, even the smaller systems represent critical interests and value; we believe the tracking and inclusion of these systems in our reporting is just as necessary as for our large systems.

A major initiative is underway in USDA to inventory and assess the status of our telecommunications systems. Good progress has been made in this area, which is scheduled for completion in July of 1998.

Our comprehensive inventory and assessment of vulnerable systems and processes, including buildings, facilities and equipment with embedded processors, is scheduled for completion in May of 1998. To date, USDA has identified over 39,000 buildings and facilities, over 38,000 vehicles and almost 400 aircraft (mostly loaned to states for firefighting purposes). While most of these will not be affected by the date change, they all must be assessed.

Renovation

Approximately half of the systems identified during the assessment phase for repair have completed the renovation phase for compliance. A 4-digit contiguous year is the established government-wide standard representation for the year and we have adhered to this standard wherever practical. This entails expanding a date field to accommodate the century designation.

I should note that we are employing a number of techniques to repair our systems. This includes the industry-accepted practice for temporarily repairing systems where expanding a date field is not possible or practical. We will track these systems and take further corrective action in the future after the immediate Year 2000 issues have been addressed.

In addition to our internal efforts, USDA is also addressing the issue of data exchanges and interfaces with states and other partners. More than 8,100 data exchanges have been identified by USDA agencies and our information sharing partners. We have been working closely with other Federal agencies and State Chief Information Officers to provide access to information on the data exchanges. Exchanges with states have been identified by each specific USDA information system, and contacts have been established between the appropriate agency representatives and their state counterparts.

These exchanges and interfaces are especially important because several of our programs are delivered in partnership with the states, such as food stamps or Women, Infants, and Children programs administered by the Food and Nutrition Service, or rely on close interaction and cooperation with industry, such as the meat and poultry inspection programs administered by the Food Safety and Inspection Service.

An example of the complexity of the interfaces and interchanges associated with Year 2000 conversion is the role of the USDA National Finance Center (NFC). The NFC receives and processes information from over 100 federal organizations, transmits it to the Department of the Treasury's Financial Management Service, which in turn has interfaces and exchanges with banks across the country and around the world. All of the data exchanges, from the originating agency to the National Finance Center, then to individual banking accounts, must be addressed and tested to ensure end-to-end functionality. The National Finance Center has six mission-critical systems, including a payroll/personnel system which supports more than 450,000 federal employees. Renovation of these systems is on track to be completed in June of 1998, validation of the systems in September of 1998 and implementation of the compliant, repaired system in

October of 1998. This complexity is why our vigilance and focus on the Year 2000 problem must continue unabated. It is not enough to fix a particular system. The entire process must work end to end in order to ensure that programs are delivered and customers served.

Validation

Testing is underway using separate Year 2000 computer systems and date-simulation tools. The National Finance Center has completed the upgrade of its mainframe operating system and has installed a test mainframe environment to simulate Year 2000 and to test system packages and applications with the system clock advanced to the Year 2000. The National Information Technology Center has drafted and distributed testing guidelines and schedules for agencies to test the Year 2000 in the test environment, which is scheduled to start in July of 1998. Several agencies, including the Forest Service and the Grain Inspection, Packers and Stockyard Administration have established Year 2000 simulation laboratories of their computing or network environment.

In order to provide assurance that mission-critical systems will operate after December 31, 1999, USDA has established a program of independent verification and validation for USDA agency Year 2000 projects. Under this program, we will be reviewing conversion efforts in information technology systems, telecommunication systems, and vulnerable systems and processes. The first candidate for this independent assessment will be the USDA headquarters complex in Washington, DC and Beltsville, MD.

The Office of Inspector General has been instrumental in helping us identify and focus on potential problem areas, and we continue to enjoy an excellent working relationship with the Office of the Inspector General as we progress in the phases of Year 2000 remediation.

Implementation

Several agencies have implemented repaired or replaced systems. We are carefully monitoring the progress of systems which are newly-developed or undergoing replacement to ensure they are delivered and implemented on schedule. Agencies have been asked to address this issue specifically in their monthly report on Year 2000 progress.

A significant challenge in meeting our Year 2000 readiness objectives is our reliance on commercial hardware and software products and services. Obtaining information from vendors is becoming more difficult as many companies have been advised by counsel not to provide or share information.

CONTINGENCY PLANNING

The USDA is reviewing the General Accounting Office exposure draft document "Year 2000 Computing Crisis: Business Continuity and Contingency Planning" and has added additional program management support resources to develop an overall USDA approach to contingency planning. We realize that we must also make plans for dealing with problems which will inevitably occur after Year 2000 rollover.

USDA has planned for, and dealt with, various kinds of emergencies for many years, such as those related to disease outbreaks and natural disasters where normal operations in towns and cities have been severely disrupted. In responding to these types of situations, USDA has worked closely with affected partners and stakeholders to restore operations. Potential Year 2000 disruptions to program delivery require that we bring the same level of contingency planning to bear on this problem.

I am not yet confident that we have thought through sufficiently the contingency planning aspects of our Year 2000 effort. This may, in part, be due to our confidence in our ability to assure that USDA information technology systems are compliant. We need to go a step further and understand that our goal is to deliver USDA programs, and we have to be ready in case others are not.

OUTREACH

In addition to ensuring that all USDA systems and the systems to which they link are Year 2000 compliant, USDA is beginning to reach out to the constituencies which we serve -- agri-business farmers, ranchers, and rural communities -- to ensure that they too are working towards correcting their Year 2000 problems. As the New York Times noted on May 4, 1998, "Computers have infiltrated every element of agriculture and influence what farmers grow, how they grow it, and how they market it."

USDA is reaching out to our customers in many ways. For the past several months, USDA principles -- Secretary Glickman, Deputy Secretary Rominger, the under secretaries, and myself -- have begun to include Year 2000 references as we speak to USDA customers. Our hope is to enhance our customers' awareness of the problem and have them ask questions in their towns and cities about actions which been taken to address this issue. My staff has begun briefing public interest group, farm bureaus, rural utility companies, and non-profits on the dangers posed by the Year 2000 problem. In addition:

• The Cooperative State Research, Education and Extension Service has issued a letter to all academic heads, extension and experiment station directors, deans, directors and administrators and other recipients of Cooperative State Research, Education and Extension Service grants, cooperative agreements, and special projects concerning Year 2000 compliance.

• The Food Safety and Inspection Service has issued a notice to directors of state inspection programs on the Year 2000 problem, with emphasis on Food Safety and Inspection Service actions and the need to share information and coordinate with State inspection programs and industry Year 2000 efforts.

• The Rural Utilities Service has sent a survey to all rural electric and telecommunications borrowers to determine Year 2000 compliance and status of corrective efforts.

Recent data suggest that rural communities and agri-business are lagging in efforts to correct the Year 2000 problem. Many communities and businesses are only beginning to realize that Year 2000 affects much more than just personal computers and large mainframe systems.

For the past few months, the Department has begun to compile information on Year 2000 effects on production agriculture. USDA staff has been in contact with public interest groups, farmers, ranchers, and information technology experts. I am troubled by the lack of information available on the subject. Consequently, I have requested the assistance of the Under Secretaries for Farm and Foreign Agriculture Services and Research, Education and Economics in developing an assessment of the effect of Year 2000 on production agriculture.

Today's farms, large and small alike, are highly reliant on computer software and electronic equipment with embedded processor technology. The USDA assessment will cover two aspects: 1) an analysis of the equipment and systems affected at the farm level, and 2) an assessment of the potential economic affect when factoring in all of the aspects involved in getting a product to market (transportation, processing, food distribution, retail). I hope this effort will provide us with an indication of potential Year 2000 effects on production agriculture. Of course, our primary objective is to raise awareness, so that any problems can be discovered and fixed before negative effects are experienced.

As the Department moves forward in its efforts to reach out to the agriculture sector of the economy, USDA will also work to assist our rural communities on obtaining information relating to the Year 2000 problem. With the assistance of organizations such as the National Association of Counties and the Nation League of Cities, the Department is preparing to inform rural communities of potential risks to health and safety, record keeping, and government services, due to Year 2000.

The information USDA compiles will be used to develop Year 2000 program materials for rapid and mass distribution through our field offices, the media, and our many partners in the agriculture sector. Current plans call for the development of a brochure, editorials, website, and public service announcements. Also, a satellite conference will be held and beamed out to our field offices, the land-grant university system, as well as businesses, local governments, and educational institutions. This conference will provide background information to assist rural communities, farmers, small businesses and families in their efforts to understand and fix any Year 2000 problems which may confront them.

The Department is very serious about these outreach efforts. We need your help to inform and assist in getting the word out that Year 2000 presents potential risks to America's farmers and rural families. I believe that there may be a disproportionate effect on Rural America if we do not pull out all the stops. This problem can be solved, but it takes action and leadership now.

LEGISLATIVE PROPOSALS

You can help us by giving the Secretary the authority which he lacks. Legislation has been proposed in the House, HR 3280, which would permit the Secretary to transfer a percentage of the agencies' information technology budgets to the Chief Information Officer to address Department-wide issues and initiatives.

Without commenting on specific provisions which address more generally the authorities of the Chief Information Officer, let me just state that we are prepared to support legislation which would encompass the following general principles:

• The Chief Information Officer, should have the necessary authority and tools to deliver on the requirements established in the Clinger-Cohen Act of 1996 to strengthen capital planning and to establish a department-wide architecture.



• Senior program officials must be part of the solution. While we appreciate the desire to consolidate authority in a single individual and to hold that individual accountable, it is critically important to ensure that information technology enables rather than drives programs. Too often in the past, we have failed because the technology has been out in front of the program.



• Legislation should focus on the general principles and objectives sought after and avoid prescriptive solutions which may prove limiting in future years.

We will be happy to continue to work with you on these issues.

Year 2000 is a priority of the Department. I am honored to work for a Secretary who has had the will and the foresight to push the Department and institute new management controls and systems to deal with the Year 2000 problem. I am also proud that Secretary Glickman has demonstrated the foresight to reach out to the communities we served and ensure that they are not forgotten as we work to meet this challenge. I look forward to continuing to work with the members of this committee as we reassure the communities and people whom we serve that the "People's Department" is ready, willing, and able to meet the challenges presented by the Year 2000 conversion.