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I am writing to request authority to reprogram up to $420,000 of funds within the Copyright Office's approved fiscal 2000 budget io initiate a critical collections security effort -item-level inventory control and tracking of copyright materials.

A basic requirement of the Library's Security Plan is to establish accountability for all copyright materials via an item-level inventory and to track these items through all processing slages from initial receipt through secure storage. Material would also be tracked when temporarily withdrawn from secure storage. With Commitee approval, the Copyright Office will implement this basic collections security control over the next three fiscal years. In fiscal 2000, the reprogrammed funds would be used for one-time start-up costs including software development and acquisition of equipment. In fiscal 2001, the Copyright Office wculd begin implementation with full operation by fiscal 2002.

Savings realized on the current collections marking and tagging security initiative are available to fund the item-level inventory system implementation. In effect, we are able to fund iwo important collections security initiatives for the amount of funds originally approved for only one initiative.

In June 1999, the Library reported to the Committee that a more cost-effective process would be used to implement the approved marking and tagging collections security initiative, and the Committee approved a fiscal 1999 reprogramming request. At that time, the Library also projected fiscal 2000 savings of $419,256. The Library requests permanent reprogramming of these savings to fund the implementation and ongoing operation of the item-level mventory control and tracking of copyright materials. We are taking positive steps to improve the security of our priceless collections in a cost-effective manner and ask that you support this next critical initiative.


Your favorable consideration of this reprogramming request would be deeply appreciated. Please let us know if you need further information on this matter.

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Copyright No-Year Account and Fee Projection for Fiscal Year 2002

The “No-Year” account was established by the Technical Amendments Act, P. L.105-80 and holds

fees which have been paid by those who use Copyright Office services. We want to use the funds in the No

Year account to improve our public services to those who pay these fees. Our principal use of the No-Year

account will be for Business Process Reengineering implementation and development of our information

technology systems. We need to insure that adequate funds remain in the account for these critical public

service improvements.

The No-Year account balance at the end of the last fiscal year was $4,289,902. The Copyright Office

does not expect to add any funds to the No-Year account this year. The Office could use up to $2 million from


its No-Year account funds to make up the shortfall caused by the fiscal 2001 net appropriation reduction.


Status of Future Fee Adjustments



The 1997 Technical Amendments Act gives the Register the authority to recommend copyright fees


based on certain criteria, with Congress retaining the authority to disapprove a fee increase. In setting fees,

the law directs the Register to conduct a study of costs for the service provided. Based on the study, and

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subject to congressional review, the Register is authorized to fix fees at a level not more than necessary to

recover reasonable costs incurred for services plus a reasonable adjustment for inflation. Congress


specifically mandated that the fees should also be “fair and equitable and give due consideration to the objectives of the copyright system.” These objectives include creating a comprehensive public record of

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copyright ownership and obtaining works for the use of the Library of Congress for its collections or its

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The Copyright Office went through an elaborate and extensive process in establishing the present fees,

which became effective on July 1, 1999. This process included hiring two contractors to conduct a cost study

and to provide expertise in the new “Federal Managerial Cost Accounting Standards.” Since raising fees each

year would be costly and disruptive, we indicated that the current fees have a minimum duration of three

years. This decision was widely publicized.

The Office is now in the process of assessing the current fee schedule to determine if fee adjustments

are warranted for fiscal 2002 and expects that the long-term effect of the July 1999 fee increase will be similar

to the experience of the 1991 increase, where claims dropped, then leveled off for the next three years. Even

if the Office were to implement a fee increase on July 1, 2002, it would not impact the fiscal 2002 fee receipt

projection since the new fees would be in place for just the last quarter of the fiscal year. Based on past

experience, we would see a high incidence of “short” fees submitted in that quarter. Based on this historical

evidence, the fiscal 2002 fee receipt forecast is the same as fiscal 2001. Based on the receipts received in the

first half of this year, the Office may see a higher level of receipts for Fiscal Year 2001 than originally



The Copyright Office looks forward to working with Congress in addressing the significant copyright

issues facing the United States both at home and abroad. Our two major initiatives for Fiscal Year 2002

planning and developing our information technology systems and implementing recommendations for -17

Account and existing resources. They will provide us with the technology and mnovation necessary to

continue to fulfill the Copyrigh: Office's mission in the digital information environment.

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