Honorable Vic Fazio January 8, 1993 Congress of the United States JOINT COMMITTEE ON TAXATION Washington, DC 20515-6453 computers (PCs) for the economists is not a discretionary expense; 2 economists cannot share a PC because virtually all the staff economists spend a significant percentage of their days using their computers to prepare responses to Member requests. In addition to the new equipment expenditures, expenditures for upgrades of existing equipment will be necessary. The Joint Committee on Taxation devotes significant resources to the preparation of revenue estimates, distribution analyses, and other economic analyses of proposed revenue legislation. The nature of this work and the speed with which the staff is normally asked to complete its analyses requires that the Joint Committee on Taxation staff utilize the most sophisticated and technologically advanced equipment. Thus, the staff finds it necessary to upgrade computer software and hardware constantly to enable the staff to provide the service required and expected by the Members of Congress. In that regard, I anticipate that the Joint Committee staff will have to begin replacing the existing PCs with desktop work stations by the end of 1993. Many of the PCs are now several years old and seriously outdated. The technology that has led to the development of desktop work stations will be approximately 20 times faster than the Joint Committee staff's current PCs. The use of this technology will substantially improve the efficiency of the Joint Committee staff. However, it is likely that each desktop work station will cost in the neighborhood of $30,000 - $40,000. I have requested a total increase in the appropriation attributable to personnel expenses of $382,000 (7.0%). This amount represents an increase of 7.0% for 2 fiscal years because of the funding freeze for FY 1993. I believe this modest increase in the appropriation for personnel expenses is the minimum amount that will enable the Joint Committee staff to continue to hire and retain qualified professional staff Honorable Vic Fazio January 8, 1993 Congress of the United States JOINT COMMITTEE ON TAXATION Washington, DC 20515-6453 a. Number of authorized positions.--The Joint Committee on Taxation has 77 authorized staff positions for fiscal year 1992. As of January 1, 1993, 74 staff positions will be filled. Recent departures from the staff (i.e., in November and December of 1992) have brought the total staff positions below the authorized level, but this situation will be temporary. b. Calculation of payroll base. --The $382,000 requested increase in the appropriation for personnel expenses was calculated based on the Joint Committee on Taxation's actual payroll for December 1992 with certain adjustments. A detailed description of these calculations is provided in Attachment E. The Joint Committee staff's December 1992 payroll was $432,448. This payroll was adjusted to reflect the following: (1) the filling of all vacant positions at an estimated monthly expense of approximately $22,000, and (2) the 1993 authorized COLA. The assumed monthly payroll with these adjustments will be $458,620; this reflects an anticipated FY 1993 annual payroll expense of $5,503,440. (2.4%) c. Cost-of-living increase.--The $5,503,440 anticipated annual payroll base was adjusted to reflect a $132,083 cost-of-living increase effective January 1, 1994. d. Merit increases.--An additional $199,477 is requested to provide average merit increases of 3.54% effective for fiscal year 1994. This modest amount reflects a reduction in the amount requested for merit increases for FY 1993, despite the fact that this amount will effectively cover merit increases for 2 fiscal years (1993 and 1994). As you know, the Joint Committee on Taxation professional staff, comprised of certified public accountants, Ph.D. economists, and lawyers with private law practice or significant government experience, agree to work for the Joint Committee on Taxation at salaries substantially below those available in the private sector. During 1992, a number of Honorable Vic Fazio January 8, 1993 Congress of the United States JOINT COMMITTEE ON TAXATION Washington, DC 20515-6453 Joint Committee staff to pursue other career options. Unless an adequate increase in the Joint Committee's appropriation is approved, it is likely that there will be further departures. Ultimately, this turnover of highly qualified, experienced staff who are replaced with less experienced staff members will undermine the ability of the Joint Committee staff to respond to Members of Congress. The Joint Committee staff performs a unique and valuable function in providing the Congress with independent, expert technical assistance in all aspects of the tax legislative process. The Appropriations Committee has recognized in the past that the Joint Committee on Taxation must be able to attract and retain an adequate number of highly qualified professionals. If the Joint Committee is to meet its staffing needs over time, it is essential that the requisite level of funding be maintained on a consistent basis. It is unlikely that the Joint Committee on Taxation will be able to pay competitive salaries in the short term. However, if the staff is going to be able to retain qualified employees for at least reasonable periods of time, the staff must have the resources to provide modest merit and cost-ofliving increases. C. Conclusion. Mr. Chairman, as the Congress continues to search for ways to balance the budget and reduce the deficit, we will continue to rely on the staff of the Joint Committee on Taxation to provide us with their technical support. The appropriation request for fiscal year 1994 is intended merely to provide the necessary resources for the Joint Committee staff to respond promptly and adequately to the requests for assistance that it receives from the Members of Congress. I recognize, however, that current fiscal realities may make it impossible to fund fully this appropriation request. While I firmly believe that any short term reduction will Honorable Vic Fazio January 8, 1993 Congress of the United States JOINT COMMITTEE ON TAXATION Washington, DC 20515-6453 necessarily result in decreased service to Members, if a reduction in the requested appropriation must be made, I recommend that the amount allocated to personnel expenses be reduced or eliminated. If personnel expense is maintained at current levels, the requested appropriation increase will be $452,000 or 7.8%. At this stage of the Joint Committee's technological development, a cutback in the amount requested to fund data preparation contracts and implementation of a document storage and tracking system would result in unacceptably imprecise revenue estimates and intolerably long delays in responding to revenue requests. If a trade off is inevitable, for this year technology must prevail over manpower. I recognize fully the budgetary constraints that make your work so difficult. At the same time, I know you appreciate the current role that the Joint Committee staff plays in the analysis and development of tax legislation. Consequently, I respectfully urge the Members of your Subcommittee to respond favorably to the Joint Committee's request for funding for fiscal year 1994. Sincerely, Dan Rostenkowski Joint Committee on Taxation |