Mr. Chairman and members of the Subcommittee:

Thank you for the opportunity to appear before you today and address the Bureau's Fiscal Year 2000 funding needs. I am providing you today with a broad overview of our plans and then, of course, will be happy to answer whatever questions you may have. With your permission, I will give the highlights of my prepared statement orally, and I request that the full, written statement be placed in the record.

NON-DECENNIAL ACTIVITIES

Other than for Census 2000, we are requesting only modest adjustments for the programs that provide the base data for the federal statistical community and a broad spectrum of public users. I strongly urge as you enter your deliberations on requirements for these programs that you not sacrifice them to meet Census 2000 requirements. Any erosion of funding for these producers of our critical economic and demographic data about and for the American people will have devastating effects on their availability and accuracy. We simply cannot afford erosion of these programs; however, we certainly prepared our estimates fully cognizant of the fiscal pressures the census places on the federal budgetary process.

The Bureau's request will permit continued collection of critical current information on diverse topics such as the state of the economy, income and poverty, health, crime victimization, housing, voting, consumer expenditures, travel and child care.

FY 2000 is the last year of the 1997 Economic Census cycle; by the end of the year we will have issued all but a handful of the 1,200 reports generated by the Economic Census. FY 2000 is also the first year of the 2002 Economic Census and Census of Governments cycles; we will begin planning for these major efforts.

More than 100 annual, quarterly, and monthly surveys provide key national economic statistics on a current basis--including services, construction, manufacturing, federal expenditures, and general economic statistics. Thanks to funding support from the Congress in prior years, the new North American Industry Classification System (NAICS) is now being implemented in the Bureau's surveys and censuses.

Also in our fiscal year 2000 request is funding to continue the American Community Survey to conduct comparative nation-wide analyses between American Community Survey at the 31 sites we established during this fiscal year. The American Community Survey must take place concurrently with the 2000 census in order to compare and analyze the data and assess whether it will allow us to eliminate the long form from the 2010 Decennial Census, long a goal of this committee and one of the intended outcomes of the Survey.

The American Community Survey is already a success story. The ACS gives current, small-area data on demographic, socioeconomic, and household characteristics of the population. Gathering these data on a more frequent basis and forming partnerships with other Federal agencies and State and local officials, helps decision makers plan and evaluate public policies. For example, the Census Bureau has been invited to participate with the Department of Justice in a crime mapping and data-driven management initiative. The community policing perspective requires current, small-area data not only on crime but also on factors which create crime risks and protect against those risks. American Community Survey data on clusters of poor housing, school dropouts who are not employed, and people who walk to work tell local officials about crime risk factors so that they can intervene before neighborhoods experience serious problems.

DECENNIAL CENSUS

FY 2000 is a critical year for the Census Bureau, in that we must carry out the Decennial Census of Population and Housing. While the estimates for the other Bureau programs will not change from what was transmitted in the President's budget, and, as I mentioned earlier, reflect only modest adjustments over Fiscal Year 1999 levels to keep pace with rising costs of operations, the estimate for Census 2000 will change significantly because of the recent Supreme Court decision.

On January 25, 1999 the Supreme Court announced their 5 to 4 decision that the Census Act does not authorize the Bureau to use statistical sampling methods in Census 2000 to produce the population count used for apportioning Congressional representation. While this ruling was disheartening to those who have worked so hard over the last seven years in an attempt to design, plan and conduct a census that is both more accurate and less costly than prior censuses, our charge now is to make every effort to be as accurate as possible without statistical methods for apportionment purposes. Consistent with the Supreme Court ruling, we will also conduct an "Accuracy and Coverage Evaluation," or ACE, to measure the undercount and produce more accurate numbers for every other purpose. It will be very difficult, particularly now that we're a mere 372 days from Census Day 2000 and the census design debate continues.

Obviously, it was necessary to make significant changes in our original plan resulting in changes to the budget estimates as presented to you. Let me summarize for you where we are and what you can expect:

• We've prepared and released an Operational Plan for a census without sampling for non-response follow-up. This Operational Plan outlines significant modifications in five areas:

• methods to improve public response;

• methods for conducting nonresponse followup operations without sampling;

• methods to improve coverage in lieu of the use of sampling techniques;

• enhancing quality assurance and training of already planned methods; and

• conducting the Accuracy and Coverage Evaluation to evaluate the census operations and produce numbers for non-apportionment purposes.

• We've prepared a new Master Activity Schedule to which we are currently adding more detail, for a census without sampling for non-response followup to incorporate changes in the areas I just noted. This schedule is the work plan for the daily activities of the thousands of permanent and temporary census workers and draws on the lessons learned from last year's Dress Rehearsal.

• We're currently working on revised budget estimates, together with a detailed explanation and justification of the changes which will be required. The Census Bureau expects to complete this task during the spring. While availability of revised estimates on this schedule may not be ideal for the appropriations process, it is the earliest I believe that we can produce these estimates with the same care and certainty of those developed over the past seven years.

• Because the change in methodology required by the Supreme Court decision affects both the timing and the magnitude of census operations, we expect to require additional funds for FY 1999, and we will also alter our previous estimates for FY 2001.

• For a number of reasons that I will explain further, the task of accurately enumerating every American in Census 2000 will be substantially more difficult and costly than the 1990 Decennial Census, and the results may not be any more accurate.

There are many factors that contribute to the difficulty of enumerating every American where they live, as well as the cost of conducting this highly integrated, complex mobilization of people and technology. First, there are more people and more housing units. In addition, the American people are more mobile than ever, so there is simply more work to be done. Second, rising labor costs and a different employee profile account for a large part of the estimated cost increase. Taking the census is extraordinarily labor intensive and under the current plan, we need to hire several hundred thousand more people than projected under the original plan. Many of the types of people who used to take temporary census jobs are employed elsewhere, resulting in the need to recruit, hire and train more people than ever before for part-time census employment, often as a second job. And, in order to be most productive, Census 2000 will need temporary workers with a high skill level, both to operate and maintain our office automation technology and to cooperatively have direct face-to-face and telephone contact with respondents. Because many of them will go to people's homes, and they must all protect the privacy of respondents, our employees must meet very stringent standards and background checks. In order for the Census Bureau to successfully compete with private industry for these skilled people, even for temporary employment, wages must be competitive, and therefore costs go up.

In addition to increased workload and labor costs, we must invest heavily in order to increase public awareness and the response rate--and to try to improve our enumeration of those who are traditionally hard-to-count. We are still finalizing the costs of a census which does not include sampling for nonresponse followup. Because it was necessary to complete the detailed Master Activity Schedule for the operating plan before calculating final costs, a detailed budget estimate for Census 2000 is not yet available.

CONCLUSION

This concludes my opening statement. Thank you again for the opportunity to appear before you today. I will place an extended version of my opening statement in the record, and now I am happy to take your questions.