oversight

Federal Paperwork: General Purpose Statistics and Research Surveys of Businesses

Published by the Government Accountability Office on 1999-09-20.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                 United States General Accounting Office

GAO              Report to the Honorable Sue W. Kelly
                 Chairwoman, Regulatory Reform and
                 Paperwork Subcommittee, House
                 Committee on Small Business

September 1999
                 FEDERAL
                 PAPERWORK
                 General Purpose
                 Statistics and
                 Research Surveys of
                 Businesses




GAO/GGD-99-169
GAO                United States
                   General Accounting Office
                   Washington, D.C. 20548

                   General Government Division



                   B-281700

                   September 20, 1999

                   The Honorable Sue W. Kelly
                   Chairwoman, Regulatory Reform and
                   Paperwork Reduction Subcommittee
                   Committee on Small Business
                   House of Representatives

                   Dear Madam Chairwoman:

                   The information collected by federal agencies is an integral tool for
                   accomplishing their missions. Agencies collect information for a variety of
                   purposes, including to verify regulatory and tax compliance, determine
                   eligibility for benefits, evaluate the effectiveness of federal programs,
                   develop economic statistics, and conduct research. However, these
                   information collections also impose a burden on those individuals,
                   businesses, and others asked or required to provide the information.
                   Federal paperwork is commonly measured in terms of “burden hours,” and
                   federal agencies estimated that they imposed nearly 7 billion burden hours
                                                       1
                   of paperwork in fiscal year 1998. Previous studies have indicated that,
                   among businesses, small businesses can be disproportionately burdened
                                                          2
                   by federal regulatory requirements.

                   Some small businesses have expressed concerns about the number of
                   surveys federal agencies ask them to complete, the amount of time it takes
                   them to complete the surveys, and the compulsory nature of some of the
                   surveys. To help address these concerns, you asked us to describe (1) the
                   paperwork burden associated with federal agencies’ general purpose
                   statistics and research (GPS/R) surveys that are directed towards
                   businesses; (2) the nature, use, and burden of selected GPS/R surveys; and
                   (3) the agencies’ efforts to reduce the burden associated with the selected
                   surveys.

                   GPS/R surveys account for an extremely small proportion (0.3 percent) of
Results in Brief   the estimated paperwork burden that federal agencies impose on
                   businesses. Nevertheless, federal agencies estimated that businesses spent
                   12.6 million hours responding to 180 of these surveys in fiscal year 1998.

                   1
                    The burden-hour figures used in this report are, unless otherwise indicated, for information collections
                   approved by the Office of Management and Budget (OMB) at end of fiscal year 1998 (September 30,
                   1998). We refer to those collections in this report as burden imposed in fiscal year 1998.
                   2
                   Thomas D. Hopkins, A Survey of Regulatory Burdens, June 1995 report to the Small Business
                   Administration.




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We estimate that all businesses’ financial costs to complete these 180
surveys were between about $219 million and $305 million. However, the
costs imposed on an individual business to complete even several of these
surveys may be quite small. Businesses are frequently required to respond
to the surveys and may face possible criminal or civil sanctions for failure
to do so. Two federal agencies—the Census Bureau in the Department of
Commerce and the Bureau of Labor Statistics (BLS) in the Department of
Labor (DOL)—accounted for more than half of the estimated
governmentwide GPS/R burden-hour total. Within these 2 agencies, 14
large surveys, each with at least 100,000 estimated burden hours,
accounted for nearly two-thirds of the governmentwide GPS/R burden-
hour estimate.

The characteristics of the 14 large Census and BLS GPS/R surveys directed
at businesses varied widely. Six of these surveys were part of the
Economic Census, which is taken every 5 years, covers virtually all
businesses, and serves to update many other business statistics. Other
large GPS/R surveys were more frequent, more limited in the number of
businesses surveyed, covered only certain types of businesses, or
addressed more specialized topics. Survey topics ranged from changes in
the selling prices of goods and services to the characteristics of businesses
owned by minorities and women. The agencies’ estimates of the time
needed to complete each survey varied from a few minutes to 6 hours. The
estimated number of respondents ranged from about 27,000 for one survey
to more than 2 million in others. The statutes requiring or authorizing the
surveys generally provide the agencies with a substantial degree of
discretion to determine the scope, substance, and, in some cases,
frequency of the surveys. All of the surveys provide economic information
that is widely used by federal, state, and local governments; businesses;
and the general public. Although the agencies indicated that responses to 5
of the 14 surveys were voluntary, some of these “voluntary” surveys are
mandatory in certain states under the laws of those states. Census and BLS
estimated that these 14 surveys imposed $179 million in financial costs on
businesses in fiscal year 1998.

Both BLS and Census have taken steps to minimize or reduce the burden
associated with these 14 GPS/R surveys, including (1) designing and
administering the survey instruments to minimize burden on the survey
respondents, (2) using information technology to enable businesses to
respond to surveys electronically, and (3) using administrative records in
other agencies as a substitute for or a supplement to surveying the
businesses directly. However, both agencies said that statutory
confidentiality restrictions are an obstacle to greater burden reduction



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             through data sharing. The executive branch has proposed and Congress
             has introduced legislation to address this issue.

             The Paperwork Reduction Act of 1995 (PRA) requires federal agencies to
Background   minimize the paperwork burden that they impose on individuals, small
             businesses, and others through their collections of information. At the
             same time, the PRA recognizes that information is a critical resource
             enabling the federal government to perform its most basic functions. The
             original PRA in 1980 established the Office of Information and Regulatory
             Affairs (OIRA) within OMB to provide central agency leadership and
             oversight of governmentwide efforts to reduce unnecessary paperwork
             and improve the management of information resources. The 1995 PRA
                                                                                         3
             gave OIRA and executive branch agencies significant new responsibilities,
             but continued the requirement that agencies obtain OIRA approval before
             collecting information from the public. It also required OIRA to set annual
             burden-reduction goals totaling at least 25 percent for the 3-year period
             ending on September 30, 1998.

             As part of its review process, OIRA requires that agencies submit a
             completed OMB Form 83-I along with other materials to justify a proposed
             information collection. The Form 83-I provides the agency’s estimate of the
             number of burden hours for the collection, which is based on (1) the
             estimated amount of time needed by each respondent to provide the
             requested information, (2) the number of respondents for the collection,
             and (3) the frequency of the collection. The Form 83-I also indicates the
             primary purpose of the collection (e.g., general purpose statistics,
             research, or regulatory or compliance monitoring); the primary target of
             the collection (e.g., businesses, individuals, or state and local
             governments); and whether responding to the survey is voluntary or
             mandatory. When OIRA completes its review, information from the Form
             83-I is to be entered into a database maintained by the Regulatory
                                                   4
             Information Service Center (RISC). OIRA uses the RISC database and
             other information to develop its annual Information Collection Budget,
             which contains governmentwide data on the number of approved
             information collections each year and the agencies’ burden-hour estimates
             as of September 30 of each year.

             3
             For a discussion of some of those responsibilities, see Regulatory Management: Implementation of
             Selected OMB Responsibilities Under the Paperwork Reduction Act (GAO/GGD-98-120, July 9, 1998).
             4
              RISC is part of the General Services Administration but works closely with OMB to provide the
             President, Congress, and the public with information on federal regulations. RISC maintains a database
             that includes information on all regulatory actions and all information collection review actions by
             OIRA.




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                       The PRA also makes OIRA responsible for governmentwide statistical
                       policy and coordination of the federal statistical system. The PRA requires
                       OIRA to ensure the efficiency and effectiveness of the system and the
                       integrity, objectivity, impartiality, utility, and confidentiality of data
                       collected for statistical purposes. The PRA also requires OIRA to develop
                       and oversee the implementation of governmentwide guidance concerning
                       statistical collection procedures and methods. Additionally, the PRA
                       mandated the establishment of an Interagency Council on Statistical
                       Policy, composed of the heads of major statistical programs and
                       representatives of other statistical agencies, to advise and assist OIRA on
                       statistical issues.

Previous Reports and   We have issued several reports and testimonies on the implementation of
                       the PRA, noting that the burden reduction goals envisioned in it were not
Testimonies                         5
                       being met. Agencies frequently pointed to new and existing statutory
                       requirements for information collection as impediments to achieving the
                       goals. We also noted a variety of problems with the “burden-hour”
                       measures that are used as indicators of the paperwork burden and said
                       that it is important to recognize the difference between the government’s
                       “measured” paperwork burden that is reflected by the number of burden
                       hours an agency reports and the “real” burden that is felt by the public.
                       Users of paperwork burden-hour estimates need to proceed with great
                       caution because it is often unclear exactly what the burden estimates
                       represent and what factors can cause changes in the totals. Nevertheless,
                       these measures are the best indicators of paperwork burden available, and
                       they can be useful as long as their limitations are considered.

                       Although one of the key purposes of the PRA is to reduce paperwork and
                       minimize burden on the public and businesses, the PRA also requires
                       agencies to balance burden reduction goals against agencies’ needs for
                       information critical to performing their missions. For the federal statistical
                       system, after years of retrenchment, there has been renewed national
                       recognition in the 1990’s of the importance of federal statistics and a
                       commitment to improve the quality of the system. We have issued several
                       reports and testimonies on major initiatives to improve the quality of
                                                    6
                       federal economic statistics. In 1990 and 1991, the Council of Economic

                       5
                        Paperwork Reduction: Burden Reduction Goal Unlikely To Be Met (GAO/T-GGD/RCED-96-186, June 5,
                       1996); Paperwork Reduction: Governmentwide Goals Unlikely To Be Met (GAO/T-GGD-97-114, June 4,
                       1997); and Paperwork Reduction Act: Implementation at IRS (GAO/GGD-99-4, Nov. 16, 1998).
                       6
                        For example, Economic Statistics: Status Report on the Initiative to Improve Economic Statistics
                       (GAO/GGD-95-98, July 7, 1995); Federal Statistics: Principal Statistical Agencies’ Missions and Funding
                       (GAO/GGD-96-107, July 1, 1996); Statistical Agencies: Statutory Requirements Affecting Government
                       Policies and Programs (GAO/GGD-96-106, July 17, 1996); Statistical Agencies: Consolidation and




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              Advisors, chaired by Michael Boskin, reviewed national economic
              statistics and announced a group of recommendations to improve the
              quality of economic statistics. The recommendations from the two “Boskin
              reports,” formally known as the Economics Statistics Initiative, have
              subsequently been a key part of the federal government’s long range
              statistical plan described in the Statistical Programs of the United States
              Government: Fiscal Year 1999 that is produced annually by OMB.
              Recommended improvements in those reports would require more
              frequent collection of some data, revised measures of key economic
              indicators, and the development of new measures for emerging industries
              and services. However, collecting more information to improve these
              economic statistics may conflict with agencies’ efforts to reduce
              paperwork burden.

              The Boskin reports and OMB also recommended increased data sharing
              among statistical agencies to reduce burden. OMB developed a legislative
              proposal to permit greater data sharing while preserving the confidentiality
              protections in existing law. Relatedly, data-sharing legislation has been
              introduced in each recent session of Congress. We have supported these
              proposals to revise existing law to permit greater data sharing in our prior
              reports and testimonies.

              We used RISC data to describe the paperwork burden associated with
Scope and     federal agencies’ GPS/R surveys that were directed toward businesses as
Methodology   of September 30, 1998 (the end of fiscal year date that OMB uses in its
              annual Information Collection Budget). RISC provided data on agencies’
              burden-hour estimates for all information collections, those directed
              primarily at businesses, and business surveys whose primary purpose was
              to develop general purpose statistics or conduct research. Of the GPS/R
              surveys on business, RISC provided data by agency, by whether responses
              were voluntary or mandatory, and by individual collection within certain
              agencies with large burden-hour totals. Using Census and BLS estimates of
              wage rates from 14 large information collections, we developed estimates
              of the annual governmentwide costs to businesses of responding to all
              GPS/R surveys.

              To describe the characteristics of the 14 large GPS/R surveys within
              Census and BLS, we obtained information that agencies submitted on the
              Form 83-I and in supplementary information that described the need for
              the surveys, how the data would be used, the agencies’ burden-hour

              Quality Issues (GAO/T-GGD-97-78, April 9, 1997); and Statistical Agencies: Proposed Consolidation and
              Data Sharing Legislation (GAO/T-GGD-98-91, March 26, 1998).




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estimates, and the agencies’ efforts to reduce paperwork burden,
particularly on small businesses. We also reviewed the relevant federal
statutory provisions for the 14 surveys to determine the extent to which
the agencies had discretion in administering these surveys. We discussed
each of the 14 surveys with responsible agency officials at BLS and Census
(e.g., to determine whether these surveys were mandatory or voluntary
within certain states), and discussed related issues (e.g., how national
economic statistics are used) with OIRA’s chief statistician and staff from
the statistics branch.

We obtained information on agencies’ efforts to reduce the burden
associated with the 14 GPS/R surveys of businesses through discussions
with BLS, Census, and OIRA officials, and by reviewing documentary
evidence. We also asked these officials about barriers to agencies sharing
the data collected through these information collections and initiatives to
eliminate these barriers to data sharing.

Our review focused on GPS/R information collections in effect at the end
of fiscal year 1998. Because the burden associated with the economic
censuses is primarily imposed only once every 5 years (which included
fiscal year 1998), the burden-hour estimates for the information collections
would be less in other years. Also, it is important to keep in mind that the
agencies’ burden-hour estimates are estimates; it is unclear how accurately
they reflect the real burden felt by the targets of the information
collections. Some of the information in this report is drawn from the RISC
database. We did not verify the accuracy of this database, but we did
obtain updated and corrected information for certain elements from BLS,
Census, and other agencies.

We did not evaluate the effectiveness of the agencies’ burden reduction
efforts or assess whether other reductions could have been made. Neither
did we independently determine how the information collected through
the GPS/R surveys is used. We conducted this review between November
1998 and August 1999 in the Washington, D.C., headquarters offices of
Census, BLS, and OIRA in accordance with generally accepted government
auditing standards.

We provided a draft of this report to officials responsible for GPS/R
surveys policy and administration in Census, BLS, and OMB for comment.
Their responses are presented in the Agency Comments and Our
Evaluation section at the end of this report.




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                                    The estimated paperwork burden on businesses from GPS/R surveys in
Most GPS/R Survey                   fiscal year 1998 was a very small portion of the estimated burden on
Burden on Businesses                businesses from all types of collections. Nevertheless, the 180 GPS/R
Was Imposed by                      surveys approved by OIRA represented a substantial aggregate burden on
                                    those businesses that had to complete the surveys—an estimated 12.6
Census and BLS                      million burden hours, or between $219 million and $305 million in
                                    business’ compliance costs. Fourteen surveys administered by Census and
                                    BLS accounted for nearly two-thirds of the governmentwide GPS/R
                                    burden-hour estimate on businesses.

GPS/R Surveys Are Small             As of September 30, 1998, OIRA had authorized federal agencies to collect
                                    information from businesses, individuals, and others through a total of
Portion of Businesses’              6,755 information collections. The agencies estimated that the paperwork
Paperwork Burden                    burden associated with all of these information collections was nearly 7
                                    billion burden hours. As figure 1 shows, roughly two-thirds (4.6 billion) of
                                    these burden hours were from information collections that were primarily
                                    directed toward businesses.

Figure 1: Burden Hours by Type of
Respondent




                                    Source: RISC database.


                                    As figure 2 shows, most of the 4.6 billion burden hours on businesses were
                                    associated with information collections primarily intended for regulatory
                                    or compliance reporting. About three-tenths of 1 percent of the 4.6 billion



                                    Page 7                                        GAO/GGD-99-169 Federal Paperwork
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                                       burden hours on businesses (12.6 million burden hours) was from 180
                                       information collections whose primary purpose was to develop general
                                       purpose statistics or research.

Figure 2: Burden Hours on Businesses
by Type of Information Collection




                                       Source: RISC database.


Most GPS/R Burden Hours Are            For more than three-quarters (9.8 million) of the 12.6 million burden hours
From Surveys With Mandatory            associated with GPS/R surveys primarily directed toward businesses, the
Responses                              businesses were required to respond to the surveys. Although failure to
                                       respond to the surveys could result in possible federal criminal or civil
                                       sanctions, officials at OIRA, BLS, and Census told us that they were
                                       unaware of any such sanctions being imposed for failure to respond to a
                                       mandatory survey. In nearly all of the remaining surveys (about 3 million
                                       burden hours), the respondents were under no federal obligation to
                                               7
                                       respond. However, as will be discussed later in this report, some of these
                                       “voluntary” surveys were made mandatory under the laws of certain states.




                                       7
                                        Surveys accounting for less than one-half of 1 percent of the governmentwide GPS/R burden-hour
                                       estimate were coded in the RISC database as voluntary but required for benefits.




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Census and BLS Imposed                  As shown in table 1, more than 80 percent of the burden associated with
                                        GPS/R surveys on businesses was from collections administered by two
Most GPS/R Survey Burden                departments—the Department of Commerce (about 66 percent) and DOL
on Businesses                           (about 15 percent). Within the Department of Commerce, 7.8 million of the
                                        8.3 million GPS/R burden hours were associated with surveys administered
                                        by Census. Similarly, BLS accounted for almost all of DOL’s 1.9 million
                                        GPS/R burden hours and surveys on businesses.

Table 1: Number of Total Burden Hours
by Agency                                                                Burden hours        Percent of total   Number of
                                        Department/Agency                    (millions)       burden hours        surveys
                                        Commerce                                    8.3                 66%            61
                                          Bureau of the Census                   (7.8)               (62)           (41)
                                        Labor                                       1.9                 15             15
                                          Bureau of Labor Statistics             (1.9)               (15)           (14)
                                        Treasury                                    0.6                   5            24
                                        Health and Human Services                   0.5                   4            18
                                        Energy                                      0.5                   4            12
                                        Other departments and agencies              0.8                   6            50
                                        Total                                      12.6                100            180
                                        Source: RISC database.


                                        Within Census and BLS, the paperwork burden is similarly concentrated in
                                        a few surveys. Eight Census surveys and six BLS surveys account for about
                                        85 percent of each bureau’s GPS/R survey burden on businesses. Together,
                                        these 14 surveys accounted for nearly two-thirds (8.4 million hours) of the
                                        governmentwide GPS/R burden-hour estimate.

GPS/R Surveys Impose                    Although paperwork burden has traditionally been reported in terms of
                                        burden hours, federal agencies’ information collection requirements
Substantial Aggregate Labor             impose real financial costs on individuals and organizations providing the
Costs on Businesses                     information. For businesses, those costs include the (1) financial resources
                                        expended to cover capital, operating, and maintenance costs for
                                        equipment, supplies, and nonlabor services (e.g., information technology
                                        systems and monitoring equipment) and (2) wages of employees
                                        responding to the collection. BLS and Census officials indicated that
                                        employee wage costs account for virtually all of GPS/R survey
                                        respondents’ financial costs.

                                        In recent years, OMB has required agencies to convert burden hours into
                                        dollar costs and report these estimates in their submissions to OMB. To do
                                        so, agencies must estimate a wage rate that would be applicable to the
                                        burden hours associated with the collection, including overhead and fringe
                                        benefit costs related to the employee’s time (e.g., health insurance and




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                                                                                      8
                                    contributions to a retirement plan). As will be discussed in detail later in
                                    this report (see table 6), Census and BLS estimated respondents’ wage
                                    rates for the 14 large GPS/R surveys range from $9.59 per hour to $30.00
                                    per hour. Using these agency estimates, we calculated that businesses’
                                    cost for completing all 14 of these surveys would be about $179 million.

                                    The estimated wage rates in these 14 surveys can serve as a rough guide
                                    for estimating the costs to businesses of responding to all GPS/R surveys.
                                    As table 2 shows, if the wage rates associated with the other 166 GPS/R
                                    surveys of businesses (4.2 million burden hours) were as low as $9.59 per
                                    hour, the cost associated with completing those surveys would be about
                                    $40 million. However, if the wage rates were as high as $30 per burden
                                    hour, the businesses’ cost for the surveys would be about $126 million. By
                                    adding these figures to the $179 million costs of the 14 largest surveys, we
                                    estimated that businesses’ cost associated with all 180 GPS/R surveys was
                                    between $219 million and $305 million.

Table 2: Estimated Labor Costs of
GPS/R Surveys of Businesses                                                                                  Estimated range of labor
                                                                                                 Burden
                                                                                                                      costs (millions)
                                                                             Number of             hours
                                    Source                                     surveys         (millions) Lower bound Upper bound
                                    Large BLS and Census surveys                    14                8.4         $179            $179
                                    Other surveys                                  166                4.2          $40a          $126b
                                    Total                                          180               12.6         $219            $305
                                    a
                                        This estimate assumes labor costs of $9.59 per hour.
                                    b
                                        This estimate assumes labor costs of $30.00 per hour.
                                    Source: The number of surveys and burden hours are from the RISC database. Cost estimates for the
                                    l4 large BLS and Census surveys are from the agencies’ Form 83-I packages. (See table 6.) Upper-
                                    and lower-bound labor cost estimates are based on wage rate ranges from BLS and Census surveys.
                                    The characteristics of the 14 large Census and BLS GPS/R surveys varied
Census and BLS GPS/R                widely. Some of the surveys applied to all businesses, but others were
Surveys Vary but                    limited to certain sectors or types of businesses. The statutes requiring or
Collectively Impose                 authorizing the surveys generally provide the agencies with a substantial
                                    degree of discretion to determine the scope, substance, and in some cases,
Substantial Burden on               frequency of the surveys. Survey topics ranged from changes in the selling
Businesses                          prices of goods and services to the characteristics of businesses owned by
                                    minorities and women. The agencies’ estimates of the time needed to
                                    complete each survey varied from a few minutes to 3.5 hours. Also, the
                                    frequency of data collection differs across the surveys. Some of the
                                    surveys are conducted monthly, but others are administered only once

                                    8
                                    In the fiscal year 1999 Information Collection Budget, OIRA said “the proper accounting of such
                                    overhead and fringe benefits has been an area of inconsistency and weakness in the present system of
                                    burden estimation.”




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                              every 5 years. The number of respondents ranges from about 27,000 for
                              one survey to more than 2 million in others.

                              All of the surveys provide economic information that is widely used by
                              federal, state, and local governments; businesses; and the general public.
                              Although the agencies indicated that responses to 5 of the 14 surveys were
                              voluntary, some of these surveys are mandatory in certain states. Together,
                              Census and BLS estimate that these GPS/R surveys of businesses account
                              for about two-thirds of the governmentwide burden-hour estimate for
                              those surveys, or $179 million in aggregate costs.

Surveys’ Subject Matter and   As tables 3 and 4 show, the scope and subject matter of the 14 Census and
                              BLS surveys of businesses that constitute the bulk of the agencies’ GPS/R
Scope Differ                  burden-hour estimates varied substantially. Some of the surveys collected
                              information about all businesses (e.g., the Producer Price Index), while
                              others focused on particular sectors (e.g., the various economic censuses)
                              or ownership groups (e.g., the Surveys of Minority- and Women-Owned
                              Business Enterprises). The topics covered by these surveys were equally
                              diverse, ranging from changes in businesses’ selling prices to
                              comprehensive information on establishments’ employment, payroll, and
                              geographic location.




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Table 3: Eight Surveys Accounted for Most of Census’ GPS/R Burden-Hour Estimate in Fiscal Year 1998
   Survey title                                         Description
1. Economic Census of the Wholesale Trade Sector        Every 5 years, this survey is to be conducted on the universe of businesses
                                                        in the wholesale trade industry. It is to collect facts about the structure and
                                                        functioning of the economy and features unique to this industry, such as
                                                        sales by commodity line and class of customer, the number of
                                                        establishments, sales, payroll, employment, and geographic location.
2. Economic Census of Manufactures                      Every 5 years, this survey is to be conducted on the universe of businesses
                                                        in the manufacturing industry. It is to collect facts about the structure and
                                                        functioning of the economy and features unique to this industry, such as
                                                        materials consumed, inventories held, the number of establishments,
                                                        payroll, employment, and geographic location.
3. Economic Census of Utilities; Transportation;        Every 5 years, this survey is to be conducted on the universe of businesses
   Information; Finance and Insurance; and Real Estate, in all of the listed sectors. It is to collect facts about the structure and
   Rental, and Leasing Sectors                          functioning of the economy and features unique to these industries, such
                                                        as amounts and sources of revenues/receipts, insurance benefits paid to
                                                        policyholders, purchased transportation, the number of establishments,
                                                        payroll, employment, and geographic location.
4. Economic Census of Retail Trade and Food Services    Every 5 years, this survey is to be conducted on the universe of businesses
                                                        in the retail trade and food services industry. It is to collect facts about the
                                                        structure and functioning of the economy and features unique to this
                                                        industry, such as sales by merchandise line and customer class, the
                                                        number of establishments, receipts/revenues, payroll, employment, and
                                                        geographic location.
5. Economic Census of Professional, Scientific, and     Every 5 years, this survey is to be conducted on the universe of businesses
   Technical Services; Management, Support, Waste       in all of the listed industries. It is to collect facts about the structure and
   Management, and Remediation Services; Educational    functioning of the economy and features unique to these industries, such
   Services; Health and Social Assistance; Arts,        as the number of establishments, receipts/revenues, payroll, employment,
   Entertainment, and Recreation; and Other Services,   and geographic locations.
   except Public Administration Sectors
6. Economic Census of Transportation/Commodity Flow     Every 5 years, this survey is to be conducted on a sample of businesses in
   Survey                                               the commodity flow industry. It is to collect facts about the structure and
                                                        functioning of the economy and features unique to this industry, such as
                                                        the value of shipments, commodities shipped, modes of transportation
                                                        used, number of establishments, receipts/revenues, payroll, employment,
                                                        and geographic location.
7. Survey of Minority-Owned Business Enterprises        Every 5 years, this joint survey is to be conducted as part of the economic
   (SMOBE) and Survey of Women-Owned Business           census program. Unlike the other economic censuses, it surveys only a
   Enterprises (SWOBE)                                  sample of the businesses to obtain information on businesses owned by
                                                        minorities and women.
8. Shipper’s Export Declaration (SED) Program           This survey is to collect information on individual shipments exported from
                                                        the United States. Shippers are to complete a survey form for almost every
                                                        shipment, and this information forms the basis for the official export
                                                        statistics compiled by Census.a The form itself serves as the export control
                                                        document used by Customs, the Bureau of Export Administration, and the
                                                        State Department.
                                              a
                                                As discussed later in this report, exports between the United States and Canada do not require a
                                              SED form to be completed. The United States and Canada have an agreement that the United States
                                              will rely on Canadian import data for its export statistics.
                                              Source: Supplementary documentation to the Form 83-I for each survey.




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Table 4: Six Surveys Accounted for Most of BLS’ GPS/R Burden-Hour Estimate in Fiscal Year 1998
   Survey title                                    Description
1. Current Employment Survey                       This survey is to collect data each month on employment, hours, and earnings
                                                   from a sample of nonfarm establishments (including governments). This is a
                                                   joint effort between BLS and the State Employment Security Agencies (SESA).
2. Occupational Employment Statistics              This annual survey is to collect occupational employment data on workers in a
                                                   sample of businesses by industry. It is a joint effort between BLS, DOL’s
                                                   Employment and Training Administration, and the SESAs, which collect the
                                                   data.
3. Multiple Worksite Report                        This quarterly survey is to collect employment and wage data from the
                                                   universe of establishments of employers who operate more than one
                                                   establishment. This is a joint effort between BLS and the SESAs.
4. Survey of Occupational Injuries and Illnesses   This annual survey is to collect information from a sample of businesses on the
                                                   characteristics of the most serious of nonfatal cases (i.e., those involving lost
                                                   work time) and the traits of workers sustaining such injuries and illnesses.
                                                   Participating state agencies collect and process the data from the employers
                                                   and provide it to BLS. (In other states, BLS collects the data directly from
                                                   employers.)
5. Producer Price Index                            This monthly survey, formerly known as the Wholesale Price Index, of a
                                                   sample of businesses is to measure average changes in selling prices
                                                   received by domestic producers for their goods and services.
6. Annual Refiling Survey                          This annual survey, formerly known as the Standard Industrial Classification
                                                   (SIC) form, is to collect and update information on a sample of employer’s
                                                   worksites, products, or services covering one-third of the businesses each
                                                   year. It is a joint effort between BLS and the SESAs.
                                             Source: BLS Handbook of Methods (April 1997) and supplementary documentation to the Form 83-I
                                             for each survey.


Underlying Statutes Give                     All 14 BLS and Census GPS/R surveys were based on statutory provisions
                                             that either require or authorize the agencies to collect and/or report certain
BLS and Census Survey                        information. However, all of the underlying statutes give the agencies at
Design Discretion                            least some discretion regarding how the surveys can be designed and
                                             administered. For example, the agency may be able to decide whether to
                                             collect information from all covered businesses or a sample of those
                                             businesses, or determine the number and subject matter of questions
                                             asked in the surveys. BLS’ annual Occupational Injuries and Illnesses
                                             Survey is based, in part, on provisions in the Occupational Safety and
                                             Health Act of 1970 (29 U.S.C. 673). The act requires the Secretary of Labor
                                             to “develop and maintain an effective program of collection, compilation,
                                             and analysis of occupational safety and health statistics,” and to “compile
                                             accurate statistics on work injuries and illnesses.” However, the act does
                                             not specify the frequency with which the survey should be conducted, the
                                             number of businesses to be contacted, or the particular data elements in
                                             the survey. The Occupational Injuries and Illnesses Survey is also based on
                                             the general requirements in 29 U.S.C. 2, which says that BLS “shall collect,
                                             collate, and report at least once each year, or oftener if necessary, full and
                                             complete statistics on the conditions of labor and the products and



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                         distribution of the products of the same.” Therefore, although BLS must
                         collect the information on workplace injuries and illnesses (and other
                         “conditions of labor”) at least once each year, it could do so more
                         frequently if it determined that more frequent collection was necessary.
                         However, BLS has not done so.

                         Other statutes underlying the surveys are somewhat more specific, but still
                         provide broad discretion in survey design and administration. For
                         example, the Census Bureau’s SED Survey is based on 13 U.S.C. 301, which
                         requires the Secretary of Commerce to submit statistics on exports from
                         the United States by country and product to certain congressional
                         committees on quarterly and cumulative bases, and to report monthly and
                         cumulative international trade balances for the United States. The statute
                         authorizes the Secretary to collect information from all persons exporting
                         from the United States, and says the Secretary “shall compile and publish
                         such information pertaining to exports . . . as he deems necessary or
                         appropriate.” Therefore, although required to report the export
                         information by country quarterly, the Secretary has substantial discretion
                         regarding the specific content of the survey.

                         Also, 13 U.S.C. 131 says that the Secretary of Commerce “shall take,
                         compile, and publish censuses of manufactures, of mineral industries, and
                         of other businesses, including the distributive trades, service
                         establishments, and transportation . . .” The statute also requires that the
                         censuses be taken every fifth year after 1968, and that the data “relate to
                         the year immediately preceding the taking thereof.” Therefore, the Census
                         Bureau has no discretion regarding the frequency of the economic
                         censuses, the sectors on which information is to be collected, or the year
                         for which the data applies. On the other hand, the agency has broad
                         discretion regarding what specific information to collect, and whether to
                         contact all businesses or a sample of businesses within each specified
                         sector.

GPS/R Survey Data Are    According to information provided by BLS, Census, and OMB, the data
                         collected in the 14 large GPS/R surveys are used for many different
Used for Many Purposes   purposes by both the public and private sectors. For example, the
                         Department of Transportation, the Federal Emergency Management
                         Agency, the Army Corps of Engineers, and other agencies use data from
                         the Census Bureau’s Commodity Flow Survey to plan transportation
                         infrastructure. Many localities also used the data from this survey in
                         responding to requirements in the Intermodal Surface Transportation
                         Efficiency Act of 1991. Similarly, the data collected in BLS’ monthly
                         Producer Price Index is used by the Federal Reserve Board’s Open Market



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                           Committee in making decisions on monetary policy and in developing and
                           evaluating monetary and fiscal measures for evaluating the general
                           business environment. These survey data are also used in the private
                           sector to evaluate escalating contract costs, inventory accounting
                           processes, and the condition of markets. In addition, industry, academia,
                           legal professionals, the news media, and the general public use the data to
                           evaluate businesses, markets, and characteristics of firms; prepare
                           business plans; make economic decisions; and conduct economic
                           research. Other examples of how GPS/R survey data are used include the
                           following.

                         • The Small Business Administration and the Minority Business
                           Development Agency use data from the SMOBE/SWOBE Surveys when
                           allocating resources for their business assistance programs. Others use
                           data from these surveys to evaluate the concentration of minority-owned
                           businesses in particular industries or geographic areas.
                         • DOL’s Occupational Safety and Health Administration (OSHA) and its
                           state-level counterparts use the data from the Occupational Injuries and
                           Illnesses Survey to evaluate the effectiveness of federal and state programs
                           to improve workplace safety and to prioritize federal and state funds.
                         • BLS uses the data collected in the Multiple Worksite Report to develop the
                           Business Establishment List, which is used as the sampling frame for
                           establishment surveys, such as the Producer Price Index.
                         • Various private enterprises, government agencies, and organized labor use
                           data from the Current Employment Survey to calculate such indexes as the
                           Composite Index of Leading Economic Indicators.
                         • Information from the Annual Refiling Survey is used in developing BLS’
                           Business Establishment List to help ensure that the correct SIC code,
                           name, and physical location are assigned to the employers’ worksites for
                           unemployment insurance records and labor market information purposes
                           in a particular state. State and local officials also use these data for
                           industrial coding classification. In addition, state employment security
                           agencies use the data to administer their unemployment insurance
                           programs.
                         • The SED Survey serves as the official record of export transactions for the
                           United States. In addition, Customs and the Bureau of Export
                           Administration use the data to enforce export regulations.

Response to Most Large     The Census Bureau indicated that survey recipients were required to
                           respond to all eight of its large GPS/R surveys because the underlying
GPS/R Surveys Was          statutes require Census to collect and/or report the information. In
Mandatory                  addition, Census officials said that they tend to get higher response rates




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                                on surveys with mandatory response requirements than on surveys with
                                voluntary responses.

                                Census officials said that the mandatory response requirement to their
                                surveys is traceable to 13 U.S.C. 224, which says

                                [w]hoever, being the owner, official, agent, person in charge, or assistant to the person in
                                charge, of any company, business, institution, establishment, religious body, or
                                organization of any nature whatsoever, neglects or refuses, when requested by the
                                Secretary or other authorized officer or employee of the Department of Commerce or
                                bureau or agency thereof, to answer completely and correctly to the best of his knowledge
                                all questions relating to his company, business, institution, establishment, religious body, or
                                other organization, or to records or statistics in his official custody, contained on any
                                census or other schedule or questionnaire prepared and submitted to him under the
                                authority of this title, shall be fined not more than $500; and if he willfully gives a false
                                answer to any such question, he shall be fined not more than $10,000.

                                The survey recipients’ obligation to respond to these mandatory Census
                                GPS/R surveys was communicated on the survey forms themselves and, in
                                some cases, in cover letters sent to the recipients. For example, the
                                Economic Census of Retail Trade and Food Services noted in bolded
                                capital letters that “your response is required by law.” At the bottom of the
                                form, also in bolded capital letters were the words “penalty for failure to
                                report.” The SED form required shippers to certify that they understand
                                “civil and criminal penalties, including forfeiture and sale, may be imposed
                                for making false or fraudulent statements herein, failing to provide the
                                requested information or for violation of U. S. laws on exportation.”
                                Although the statute allows for the imposition of criminal penalties for
                                failure to respond to a survey, Census officials told us that they have never
                                pursued any prosecutions.

                                In contrast to the Census surveys, response to five of the six BLS GPS/R
                                surveys of businesses was voluntary at the federal level. BLS officials said
                                that they prefer to use voluntary surveys, and that response rates are
                                generally higher when a survey is voluntary. They said one of their surveys,
                                the Occupational Injuries and Illnesses Survey, is mandatory because of a
                                specific federal statutory provision.

Some “voluntary” surveys were   Although the RISC database indicated that responses to five of the six
mandatory in certain states     large BLS GPS/R surveys were voluntary at the federal level, BLS officials
                                said that some states and territories made four of these surveys mandatory
                                during fiscal year 1998.




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                       • Response to the Multiple Worksite Report Survey was mandatory in 21
                         states, Puerto Rico, and the Virgin Islands.
                       • Response to the Annual Refiling Survey was mandatory in 19 states, Puerto
                         Rico, and the Virgin Islands.
                       • Response to the Current Employment Survey was mandatory in four states
                         and Puerto Rico.
                       • Response to the Occupational Employment Survey was mandatory in
                         North Carolina.

                         The officials said that survey recipients’ obligation to respond varied
                         between levels of government because BLS and the states and territories
                         jointly administered these surveys, and states can add requirements and
                         make the respondents’ obligation mandatory under state law. Although the
                                                                                                     9
                         BLS survey instruments usually indicated that responses were voluntary,
                         at least some of the cover letters that the states include with the surveys
                         inform the recipients of their mandatory nature. For example, on the first
                         page of the Multiple Worksite Report Survey, BLS stated that “[y]our
                         voluntary cooperation is needed to make the results of this survey
                         comprehensive, accurate, and timely.” However, the cover letter added by
                         the State of California stated that “completion of this form is required by
                         section 320 and 320.5 of the California Unemployment Insurance (UI)
                         Code.”

Large GPS/R Surveys      As noted earlier in this report, agencies’ annual burden-hour estimates for
                         an information collection are a function of three elements: (1) the time
Impose Substantial       needed to complete the information collection (including reviewing the
Aggregate Paperwork      instructions, searching existing data sources, and gathering and
Burden On Businesses     maintaining the needed data); (2) the number of respondents to the
                         collection; and (3) the frequency with which the information is collected
                         from the respondents within the specified year. Table 5 shows that,
                         although the agencies estimated that each of the 14 large GPS/R surveys
                         directed at businesses would require more than 100,000 burden hours of
                         paperwork, the surveys varied substantially in terms of these three
                         components. For example, the agencies estimated that some of the surveys
                         would take only a few minutes to complete (e.g., the Annual Refiling
                         Survey and the Current Employment Survey), but others were expected to
                         take hours (e.g., the Economic Census of Manufactures). Most of the
                         surveys were conducted only once during fiscal year 1998, but others were
                         administered quarterly (such as the Multiple Worksite Report) or monthly
                         (such as the Current Employment Survey and the Producer Price Index).
                         Several of the surveys that were administered during 1998 are not
                         9
                             BLS indicated in the Current Employment Survey that responses were mandatory in four states.




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                                         scheduled to be repeated for 5 years. The number of survey respondents
                                         varied from as few as 27,000 (the Producer Price Index) to more than 2
                                         million (the Annual Refiling Survey and the SMOBE/SWOBE Survey). In
                                         most cases, the surveys that the agencies expected to take the longest to
                                         complete were administered less frequently and to fewer respondents than
                                         surveys expected to take only a few minutes to complete.


Table 5: Burden-Hour Estimates for Selected BLS and Census GPS/R Surveys of Businesses in Fiscal Year 1998
                                                Est. survey                            Est. number of        Est. annual
                                            completion time                              respondents       burden hours
Survey                                            (minutes)       Survey frequency        (thousands)       (thousands)
Bureau of Labor Statistics
Occupational Injuries and Illnesses Survey                54                 Annually             230                207
Multiple Worksite Report                            10 to 60                 Quarterly            113                167
Current Employment Survey                            2 to 15                  Monthly             437                596
Annual Refiling Survey                               5 to 15                 Annually           2,086                203
Occupational Employment Survey                            45                 Annually             337                251
Producer Price Index
    Initial Visit                                       120                      Once              (6)               (13)
    Monthly Repricing                                5 to 30                  Monthly              27                378
Total                                                                                           3,230              1,802
Bureau of the Census
SED                                                  3 to 11           Each shipment              159              1,316
Economic Census of Manufactures                  120 to 360       Once every 5 years              210                762
Economic Census of Wholesale Trade Sector                 70      Once every 5 years              540                634
Economic Census of Transportation/                           Quarterly during a 1-year
Commodity Flow Survey                                   120      period every 5 years             100                805
Economic Census of Retail Trade                           46      Once every 5 years            1,291                993
Economic Census of Professionals                          37      Once every 5 years            1,443                900
Economic Census of Utilities                              74      Once every 5 years              625                766
SMOBE/SWOBE                                               10      Once every 5 years            2,500                417
Total                                                                                           6,868              6,593
Total for BLS and Census                                                                       10,098              8,395
                                         Note 1. The estimated annual burden hour totals reported by the agencies do not always equal the
                                         product of the estimated completion time, frequency, and number of respondents. Average
                                         completion time is reported as a range for some surveys and anticipated response rate may affect the
                                         estimated number of respondents.
                                         Note 2. The Annual Refiling Survey is required at 3-year intervals. BLS annually surveys a different
                                         third of the universe so that at the end of the 3-year period, it has administered this survey to the
                                         universe. Unlike all the other surveys we reviewed, SED surveys are completed by the shippers at the
                                         time of the export transaction and sent to Census. All of the other surveys are administered to the
                                         businesses by the agencies on a monthly, quarterly, or annual basis. The economic censuses are
                                         required every 5 years, which happened to fall during the time frame of our review. The Economic
                                         Census of Transportation/Commodity Flow Survey is required during each quarter in the year that the
                                         survey is taken.
                                         Source: BLS and Census.




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Agencies Indicate Surveys   Federal paperwork can also be measured in terms of financial costs
                            imposed on respondents. For businesses, those costs can be roughly
Impose Substantial          divided into the cost of the employees’ time to respond to the survey and
Aggregate Costs             other costs, including capital and operating expenses (e.g., the purchase of
                            new hardware or software systems to produce the required information).
                            Both BLS and Census indicated that the 14 GPS/R surveys imposed no
                            such “other” costs.

                            BLS and Census estimated the cost of employees’ time to respond to an
                            information collection by multiplying the number of burden hours
                            associated with an information collection by the wage rate(s) of the types
                            of employees needed to produce the information. According to OMB,
                            agencies’ estimates of the wage rates for respondents should include
                            overhead and fringe benefit costs associated with the employee’s time
                            (e.g., health insurance and contributions to a retirement plan). As shown in
                            table 6, BLS’ estimates of the respondents’ hourly rates for its six largest
                            GPS/R surveys ranged from $9.59 to $19.91. Census estimated the
                            respondents’ hourly wage rates for its eight largest GPS/R surveys at
                            between $12.73 and $30.00. Multiplying the agencies’ estimates of the
                            respondents’ wage rates times their burden-hour estimates for the 14
                            GPS/R surveys of businesses yields a total cost to businesses of about $179
                            million in fiscal year 1998.




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Table 6: Estimated Costs Associated
with Responding to Surveys in Fiscal                                             Respondents’         Annual burden        Total costs to
Year 1998                                                                        wage rate per                hours          businesses
                                       Survey title                                      hour           (thousands)            (millions)
                                       Bureau of Labor Statistics
                                       Occupational Injuries and Illnesses                $12.50                   207                $ 3
                                       Multiple Worksite Report                            13.72                   167                   2
                                       Current Employment Survey                            9.59                   596                   6
                                       Annual Refiling Survey                              13.04                   203                   3
                                       Occupational Employment Survey                      19.03                   251                   5
                                       Producer Price Index                                19.91                   391                   8
                                       Total for BLS                                                             1,815                $ 27
                                       Bureau of the Census
                                                                                                 a
                                       SED                                                                       1,316                $ 14
                                       Economic Census of Manufactures                     12.93                   762                  10
                                       Economic Census of Wholesale
                                       Trade Sector                                        30.00                   634                  19
                                       Economic Census of
                                       Transportation/Commodity Flow
                                       Survey                                              30.00                   805                 24
                                       Economic Census of Retail Trade                     30.00                   993                 30
                                       Economic Census of Professionals                    30.00                   900                 27
                                       Economic Census of Utilities                        30.00                   766                 23
                                       SMOBE/SWOBE                                         12.73                   417                  5
                                       Total for Census                                                          6,593               $152
                                       Total (BLS and Census)                                                    8,408               $179
                                       a
                                        The estimated cost per hour to complete a SED Survey ranges from $10 for a paper submission to
                                       $15 for an electronic submission. Of the 1.3 million burden hours, Census estimated that about 1.1
                                       million burden hours were for paper responses and about 0.2 million hours were for electronic
                                       responses. Therefore, the burden-hour cost for the paper responses would be $10.7 million and for
                                       the electronic responses $3.7 million.
                                       Source: BLS and Census data.


                                       It is important to remember that these are aggregate burden-hour and cost
                                       estimates for all businesses in fiscal year 1998. The cost borne by each
                                       business that receives one of these surveys is significantly less. For
                                       example, recipients of the Occupational Injuries and Illnesses Survey take
                                       an estimated 54 minutes (.9 hour) each year filling out the form, with an
                                       associated wage rate of $12.50 per hour. Therefore, the estimated cost to
                                       each recipient of the survey is $11.25 per year. Although a single business
                                       may receive more than one of these surveys each year, its aggregate
                                       burden may still not be substantial. For example, even if a single business
                                       received all six of the BLS GPS/R surveys and the Census Bureau’s
                                       SMOBE/SWOBE Survey in 1 year, the estimated labor cost to complete all
                                       of the surveys would be less than $134.




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                        Both BLS and Census have taken a number of steps to minimize or reduce
Census and BLS Have     the burden associated with the 14 large GPS/R surveys primarily directed
Attempted to Minimize   toward businesses. These steps include (1) designing and administering
Burden of GPS/R         the survey instruments to minimize burden on the survey respondents, (2)
                        using various types of information technology to enable businesses to
Surveys on Businesses   respond to surveys electronically, and (3) using information found in
                        administrative records in other agencies as a substitute or a supplement to
                        surveying the businesses directly. However, both agencies said that
                        statutory confidentiality restrictions are an obstacle to greater data
                        sharing, which could result in further burden reduction.

Survey Design and       Census and BLS have attempted to design and administer their largest
                        GPS/R surveys to minimize the burden they impose on businesses,
Administration          particularly small businesses. For example, both agencies have developed
                        versions of some of their surveys for small businesses with fewer or less
                        complicated questions than versions directed to larger businesses. In the
                        Economic Census of Wholesale Trade, Census sends establishments with
                        fewer than four paid employees a simplified version of the survey form
                        that requests less data than the standard form that is sent to larger
                        employers. Similarly, businesses with only one owner receive shorter
                        SMOBE and SWOBE Surveys than businesses with more than one owner.

                        BLS and Census have also used sampling techniques to limit the number of
                        businesses to whom surveys are directed. The agencies also use special
                        sampling procedures in some surveys that reduce the chances of a smaller
                        business being selected compared to larger businesses, or of the same
                        businesses repeatedly being selected to respond to the survey. For
                        example, in its Occupational Injuries and Illnesses Survey, BLS employs a
                                                                                              10
                        stratified random sampling approach in selecting survey recipients. As a
                        result of using this approach, less than 4 percent of all businesses actually
                        receive a survey. Also, small employers (10 or fewer employees) are
                        prenotified in the Occupational Injuries and Illnesses Survey that they have
                        been selected for the survey and will need to maintain records. In the
                        Annual Refiling Survey, BLS annually surveys one-third of the universe of
                        the eligible businesses. As a result, an individual business can only be
                        selected for the survey once every 3 years. Similarly, to ensure that small
                        businesses are not unduly burdened by the Producer Price Index Survey,
                        BLS changes the sample of companies surveyed every 4 to 7 years.



                        10
                         In stratified random sampling, the researcher ensures that appropriate numbers of elements are
                        drawn from homogeneous subsets of the population.




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The agencies have also attempted to minimize the surveys’ burden on
business by making it as easy as possible for the business to respond to the
surveys. For example, BLS’ Occupational Injuries and Illnesses Survey is
designed to allow employers who have no worker injuries or illnesses
(many of whom are small employers) to simply check a “no
injuries/illnesses” box on the survey, provide the number of employees and
hours worked, and return the survey in a postage paid envelope. Similarly,
the Census Bureau incorporated several changes into its Economic Census
of Transportation/Commodity Flow Survey to reduce burden on
businesses. For example, Census reduced the number of establishments
that were surveyed by 50 percent; reduced the shipping period covered by
the questionnaire from 2 weeks to 1 week; reduced the number of
shipments per questionnaire that respondents had to report on by 20
percent (from 50 to 40 shipments); and allowed respondents to use
estimates rather than actual numbers, particularly when generating the
actual numbers would require the respondent to incur additional expenses.

Changing the frequency of administering the surveys is another approach
that could be used to reduce burden on business. However, in some cases
the agencies are already administering the survey as infrequently as the
underlying statutes allow. Also, BLS and Census officials indicated that
administering their large GPS/R surveys any less frequently could have a
negative effect on the primary purposes of the data collections. For
example, BLS officials indicated that federal policymakers and economic
advisors use the monthly Producer Price Index in forming and evaluating
monetary and fiscal policy and helping to evaluate the general business
environment. They indicated that if this information were collected less
frequently it would take longer to recognize and adapt to changes in the
economy. Similarly, BLS officials said that collecting the quarterly Multiple
Worksite Report data less frequently (such as annually or semiannually)
would not provide the data necessary for certain users to produce
important economic indicators or to administer various programs at the
local, state, or national levels.

In addition, Census officials stated that conducting economic censuses
less frequently than every 5 years would diminish the time lines and
usefulness of the statistics produced and diminish the usefulness of the
economic census as a source of comprehensive information for economic
policymaking, planning, and program administration. Likewise, Census
officials said it is very important to collect export data through SED on an
ongoing basis. They said that if SED data were collected less frequently,
the government would not be able to produce monthly statistics on the
trade balance. They indicated that this information is a valuable



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                    component of the merchandise trade balance, which is one of the most
                    sensitive and closely watched economic indicators produced by the federal
                    government. Slight movements in the deficit could affect public policy,
                    financial decisions, or congressional actions.

Use of Technology   Census and BLS are also using information technology in some of their
                    surveys to minimize the burden imposed on businesses through their
                    GPS/R surveys, to increase survey response rates, and to obtain more
                    accurate and up-to-date information. One common use of technology for
                    these surveys was some type of electronic filing of survey responses. For
                    example, BLS collects more than 80 percent of the responses to its Current
                    Employment Survey electronically. Census collects nearly half of the SED
                    responses in this manner. Electronic submission of the SED form cut the
                    estimated time needed to complete the survey from about 11 minutes to 3
                    minutes. The format of those electronic responses sometimes includes a
                    range of techniques for a single survey, including the use of computers,
                    telephones, and facsimiles. For example, BLS collects responses to the
                    Current Employment Survey via touch-tone data entry, computer-assisted
                    telephone interviews, electronic data interchange, facsimile collection, and
                    submission of tapes and diskettes.

                    The agencies are continuing to develop their uses of technology in virtually
                    all of these large GPS/R surveys, and have begun to provide technical
                    assistance to businesses in their use. For example, in 1987, Census
                    established a National Clearinghouse for Exporter Data Processing
                    Services to encourage exporters to use technology when filing their SED
                    reports. The Clearinghouse provides technological support to exporters,
                    freight forwarders, and carriers who want to file electronically but do not
                    have the capability to do so. Census officials said that they are replacing an
                    antiquated electronic exports reporting system with a new state-of-the-art
                    system that includes the filing of export documentation over the Internet.
                    When this is completed, there is to be one automated export tracking
                    system that would allow exporters to enter information into a single
                    common system that is used by Census, the Customs Service, and other
                    agencies.

                    BLS identified several specific ways it is changing its data collection
                    procedures to allow businesses to make better use of information
                    technology. For example, employers with worksites in more than one state
                    must currently submit their Multiple Worksite Reports to the relevant state
                    agencies in each state. BLS is encouraging the use of a program to permit
                    these employers to electronically submit the reports to a single data
                    collection center that would then distribute the report to all of the relevant



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                         state agencies. BLS is also working with several private organizations that
                         prepare businesses’ payroll and reports commercially to enable them to
                         offer their clients the additional service of electronically submitting the
                         Multiple Worksite Reports directly to BLS. Finally, BLS officials said the
                         agency is developing a technology-based system for administering the
                         Producer Price Index that could benefit both businesses and BLS. Under
                         this system, BLS would be able to send businesses the price quotation
                         forms via the computer and allow the businesses to respond by facsimile.

Use of Data From         For several of the 14 large GPS/R surveys, Census and BLS obtained at
                         least some of the needed data from administrative records kept by other
Administrative Records   federal agencies, by state and local agencies, or by other organizations
                         rather than asking the respondents to provide the same information. In at
                         least some of these surveys, the use of administrative records resulted in
                         less paperwork burden on small businesses. For example, the Economic
                         Censuses on Manufactures, Professionals, and Utilities exclude most small
                         establishments from the mail surveys, relying instead on information from
                         administrative files kept by the Internal Revenue Service and the Social
                         Security Administration. The Census Bureau obtains more than 40 percent
                         of the responses to the Economic Census of Manufactures through
                         administrative records and more than one-quarter of the responses to the
                         Professionals and Utilities Censuses in this manner.

                         In the SED program, the United States and Canada entered into an
                         agreement in 1990 to share data on imports and exports, thereby reducing
                         the paperwork burden on shippers. In this agreement, the Census Bureau
                         uses Canadian data on imports from the United States as its measure of
                         American exports to Canada. Similarly, Canada uses U.S. data on Canadian
                         imports to replace the same data it had collected from its exporters. This
                         data-exchange agreement has resulted in the elimination of the
                         requirement for business exporting products from the United States to
                         Canada to file SEDs for each shipment, thereby saving American exporters
                         from preparing an estimated 3.5 to 4.0 million SEDs annually.

                         BLS also uses administrative data to reduce the paperwork burden
                         associated with some of its GPS/R surveys. For example, businesses
                         typically report workplace injuries and illnesses to both BLS through its
                         Occupational Injuries and Illnesses Survey and to state governments
                         through their workers’ compensation programs. However, version “W” of
                         the Occupational Injuries and Illnesses Survey enables businesses in six
                         participating states to provide less detail on their survey response if they
                         have already reported the detailed information to their states’ workers’




                         Page 24                                       GAO/GGD-99-169 Federal Paperwork
                            B-281700




                            compensation programs. BLS obtains this information from the worker
                            compensation agencies in those states.

Statutory Restrictions on   In the Information Collection Budget for fiscal year 1999, OMB identified
                            seven categories of initiatives that agencies were undertaking to reduce
Data Sharing Prevent        paperwork burden. Census and BLS have begun or completed initiatives in
Further Burden Reduction    most of these categories. However, Census and BLS are statutorily
                            prohibited from fully utilizing one of the seven categories—data sharing.

                            The Census Bureau’s restrictions on data sharing are in 13 U.S.C. 9, which
                            states that no officer or employee of the Department of Commerce or
                            bureau or agency thereof, may

                            “(1) use the information furnished under the provisions of this title for any purpose other
                            than the statistical purposes for which it is supplied; or (2) make any publication whereby
                            the data furnished by any particular establishment or individual under this title can be
                            identified; or (3) permit anyone other than the sworn officers and employees of the
                            Department or bureau or agency thereof to examine the individual reports.”

                            This and other statutory prohibitions on data sharing were put in place to
                            protect the confidentiality of survey respondents. The original PRA in 1980
                            gave the director of OMB the authority to direct a statistical agency to
                            share information it had collected with another statistical agency.
                            However, this authority did not apply to information covered by laws
                            prohibiting such disclosures. In the early 1980s, the statistical agencies,
                            under OMB’s leadership, proposed legislation that would have extended
                            their ability to share data, but legislation was not enacted.

                            For the past 2 decades, we and others have urged legislative changes that
                            would allow greater sharing of data and information on data sources
                            among agencies. In 1979, we recommended that existing law be amended
                            to allow the Bureau of the Census to share information on business
                                                                                11
                            establishments with other government agencies. More recently, in March
                            1998, we said that the inability of statistical agencies to share data is one of
                            the most significant issues facing the statistical system and one of the
                            major factors affecting the quality of data, the efficiency of the system, and
                            the amount of burden placed on those who provide information to the
                                      12
                            agencies.


                            11
                             After Six Years, Legal Obstacles Continue to Restrict Government Use of the Standard Statistical
                            Establishment List (GAO/GGD-79-17, May 25, 1979).
                            12
                             Statistical Agencies: Proposed Consolidation and Data Sharing Legislation (GAO/T-GGD-98-91, Mar.
                            26, 1998).




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              Data sharing is still an issue of concern in both the executive and
              legislative branches. One of the Clinton administration’s key initiatives
              identified in the Statistical Programs of the United States Government:
              Fiscal Year 1999 addresses needed changes in statistical confidentiality
              and data-sharing statutes and practices. Also, legislation has been
                                     th
              introduced in the 106 Congress (S. 205), which would, among other
              things, permit limited sharing of records among designated agencies for
              statistical purposes under strong safeguards.

              Both Census and BLS support administration proposals to revise the
              confidentiality statutes to allow data sharing among statistical agencies.
              Officials in both agencies said that proposed changes permitting greater
              data sharing offered a major way to reduce burden on businesses without
              compromising the confidentiality or the quality of the information
              collected. However, neither BLS nor Census is able to estimate how many
              burden hours might be reduced in general or for specific surveys if data-
              sharing legislation were enacted. A Census official told us that the extent
              of burden reduction would depend on the specific provisions of the
              legislation and on how data sharing was implemented. Among the 14
              surveys that we examined, the official identified instances where Census
              and BLS have duplication or overlap between collections and could
              potentially reduce burden by sharing. However, he said the greater
              potential for reducing burden would come from the agencies jointly
              reengineering survey programs to increase standardization and reduce
              duplication.

              GPS/R surveys directed at businesses are extremely useful to federal
Conclusions   agencies, state and local governments, and to the businesses themselves.
              For example, the Producer Price Index is used to make decisions on
              monetary policy and to evaluate the condition of markets. Information
              from the Occupational Injuries and Illnesses Survey is used to determine
              the effectiveness of federal and state safety programs. The SED data are
              the official record of export transactions from the United States. These
              surveys also contribute data to national economic indicators that have
              been developed and refined over the years to meet the needs of economic
              policymakers and others for timely, accurate, and consistent information
              on the state of our national economy.

              Although GPS/R surveys of businesses account for a very small portion of
              federal agencies’ total paperwork burden, the 12.6 million hours that
              agencies estimated it took all businesses to complete GPS/R surveys in
              fiscal year 1998 is a substantial paperwork burden. We estimated that
              businesses’ aggregate labor costs to complete these surveys ranged from



              Page 26                                      GAO/GGD-99-169 Federal Paperwork
                      B-281700




                      roughly $219 million to about $305 million. However, the burden imposed
                      on any one business may be quite small. Census and BLS, which account
                      for the bulk of the burden hours associated with GPS/R surveys, have
                      taken and continue to take steps to minimize or reduce the burden
                      associated with these information collections.

                      However, Census, BLS, and other statistical agencies are unable to
                      minimize or reduce paperwork burden as much as possible because of
                      statutory restrictions on sharing data collected for statistical purposes
                      between the agencies. We, OMB, and the statistical agencies have
                      supported revising those restrictions. Doing so could reduce information
                      collection costs to both respondents and the agencies collecting the data.

                      We provided a draft of this report to officials responsible for GPS/R survey
Agency Comments and   policy and administration in Census, BLS, and OMB for their review and
Our Evaluation        comment. We received oral comments from Census and BLS on August 20,
                      1999, and from OMB on August 30, 1999. Each agency agreed with our
                      overall characterization of GPS/R surveys of businesses and our
                      conclusions and each suggested technical and editorial changes, which we
                      incorporated into the final report as appropriate.

                      We are sending copies of this report to Representative William J. Pascrell,
                      Jr., Ranking Minority Member, House Committee on Small Business’
                      Subcommittee on Regulatory Reform and Paperwork Reduction; the
                      Honorable Jacob J. Lew, Director of OMB; the Honorable Alexis M.
                      Herman, Secretary of Labor; and the Honorable William M. Daley,
                      Secretary of Commerce. We will make copies available to others on
                      request.




                      Page 27                                      GAO/GGD-99-169 Federal Paperwork
B-281700




If you have any questions regarding this report, please contact me on (202)
512-8676. Key contributors to this assignment were Curtis Copeland,
Elizabeth Powell, and Ellen Wineholt.

Sincerely yours,




L. Nye Stevens
Director, Federal Management and
  Workforce Issues




Page 28                                      GAO/GGD-99-169 Federal Paperwork
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