Base program on wind damage: As part of its wind engineering effort, NIST works to improve wind loading provisions in standards and codes that will increase the safety and economy of buildings and lifelines. NIST, in collaboration with the National Oceanic and Atmospheric Administration (NOAA), has contributed to fundamental knowledge of extreme wind climatology that has influenced the state-of-the art and current standards available to local communites.

NIST experts have participated in recent post-storm investigations following notable events such as the tornado outbreaks in Central Florida (1998) and Jarrell, Texas (1997), and hurricanes Fran (1996), Marilyn (1995), Andrew (1993), and Hugo (1989). NIST, in partnership with NOAA and the casualty insurance industry, conducted a workshop to discuss wind perils and losses from hurricanes, tornadoes, severe windstorms, and wind-driven hail. The 1996 workshop emphasized that, among natural hazards, wind peril has accounted for over 80 percent of insurance industry natural hazard losses in recent years and recommended creation of a National Wind-Peril Mitigation Program modeled after NEHRP.

Further, NIST is a participant in the National Post-Storm Data Acquisition Plan (NPSDAP) developed by the Interdepartmental Committee for Meteorological Services and Supporting Research (ICMSSR) and administered by the Commerce Department.

Natural Disaster Reduction Initiative (NDRI): NIST's base program cannot support all of the high priority measurements and standards needs for disaster mitigation. Recognizing the importance of reducing economic losses to the Nation from natural disasters, the President's FY 1999 budget requests an additional $3.0 million per year for NIST as part of the five-year, $305 million Commerce NDRI. Through this initiative, NIST will develop and disseminate measurements and standards for nextgeneration technologies and improved practices that will permit communities and technical experts to take cost-effective actions to reduce the effects of disasters and to improve response and recovery measures.

The initiative is focused on our Nation's infrastructure systems, the basic installations and facilities which underpin the viability and growth of our communities. These include not only our buildings but also lifelines electric power/water/sewage services, computer communications on the internet, oil and gas delivery and storage, transportation systems, and industrial facilities. Moreover, these systems support banking and financial services, fire safety and other emergency services. The initiative will permit NIST to address unmet high priority measurements and standards needs for disaster mitigation.

The increase will emphasize the development of standards and codes for strengthening and rehabilitating existing infrastructure, in contrast to developing standards for new construction. This capability is critical since total rebuilding of currently vulnerable infrastructure is extremely expensive. Further, the initiative will place increased emphasis on wind perils and the problem of post-disaster fires. The NIST effort is

coupled with NOAA's research on extreme wind measurements and predictions. NIST work will assist in harnessing wired and wireless communication systems employing internet technologies in disaster/crisis management and disaster mitigation. The increase will also fund new work to develop measurement methods required to: assess pre- and post-disaster conditions that will assist in making fitness-for-use, repair, and strengthening decisions; apply innovative, high-performance materials and systems; and enable early detection of system vulnerabilities to natural disasters.

QUESTIONS SUBMITTED BY CONGRESSMAN FORBES

Reorganization: Industry Sectors

QUESTION: Commissioner Lehman, last year around this time you submitted a request to this Committee for a reprogramming of funds to allow you to reorganize the Patent and Trademark Office into “Industry Sectors.” European patent offices are organized by Industry Sectors, although some patent experts feel this structure is less effective and efficient.

The reprogramming request was turned down because this committee felt it was too premature to reorganize the Patent Office while the future of the PTO is still uncertain. Some concerns were also expressed about the effectiveness of "Industry Sectors.” I understand, however, that you have proceeded with your reorganization plan and are in fact about half finished.

Could you please explain why you decided to proceed with the reorganization, knowing that Congress is debating the future of the Patent and Trademark Office and you could very well be required to undo all of your efforts to date?

ANSWER: Let me begin by presenting the chronology of events surrounding my reorganization proposal, last year:

March 11, 1997 - I submitted to your Subcommittee a reorganization proposal intended to begin the transition of the PTO to a performance-based organization, by separating policy functions from operations, and reorganizing the operational structure of the Office.

May 1, 1997 — Chairman Rogers notified me of the Committee's disapproval of my proposal because "the Committee believes it premature to approve a major reorganization of the PTO at this time ..."

July 1, 1997 An agreement was entered into by the PTO and the Patent Office Professional Association (POPA) with respect to the reorganization of the Patent Cost Center into Industry Sectors (Attachment_1). (A similar agreement between the PTO and the National Treasury Employees Union, Chapter 243, was signed earlier on December 17, 1996. Attachment 2.)

August 29, 1997 OMB approved the consolidation of Patent Examining
Groups into Technology Centers.

September 22, 1997 Mr. Raymond Kammer, then Acting Chief Financial Officer and Assistant Secretary for Administration of the Department of Commerce, notified the Chairman of your Subcommittee of my actions with respect to consolidating the Patent Examining Groups into Technology Centers (Attachment_3). Department of Commerce officials agreed that this

consolidation was not a reorganization. The Office of Management and Budget (OMB) agreed with this determination in a letter dated August 29, 1997.

I had stated then and I reiterate now that the actions I have taken in the past six months do not reflect any deviation from the Committee's decision to defer a major reorganization of the PTO until such time as final congressional action has occurred on our government corporation legislation. The consolidation of Patent Examining Groups into technology centers does not represent a change in the basic organizational structure and assignment of functions and authorities of the PTO. It simply provides for a configuration that aligns art units in related technologies into units that parallel technological areas in private industry without restructuring and/or reorganizing the patent classification operations and the initial and post-examination functions into the technology centers.

Absent a reorganization, this interim solution of regrouping the Patent Examining Corps by technology was necessary for patent operations given the changing composition and technological profile of applications filed. The favorable results we had previously achieved with matrix' management in the electrical and chemical examining clusters led us to believe that a similar arrangement across the Patent Examining Corps would better serve our customers. For example, the centralization of the receptionist function provided our customers with a single contact point and more staff was available on location at all times to answer customer queries. The matrix concept also ensured process consistency throughout the cluster and made absentee coverage at all levels of the cluster a responsibility inherent to the team concept. Also, the consolidation of files in a central location within the cluster has contributed to reducing the number of lost

cases.

Outside of our positive experience with the electrical and chemical clusters, the experiences shared by the European Patent Office and the benefits their customers have enjoyed attest to the advantages this type of a configuration offers and the productivity gains we expect to receive upon full implementation of the Industry Sector concept. (Attachment 4 is a copy of a letter from Mr. Jacques Michel, the Vice President of the European Patent Office, that highlights their experiences with a similar reorganization to Industry Sectors). I strongly believe that to be responsive to the needs of the inventors of our Nation, we must have the flexibility to rearrange examining groups and art units in a manner that makes us more efficient and provides the vehicle for improved partnership with industry. In fact, we have done so in the past we have historically realigned examiners, art units, and groups to better address the changing distribution by technology of incoming application filings.

This is a management concept whereby people from different disciplines and varying expertise are pooled together for a specific purpose or task for which they have collective responsibility. Through open communication and sharing of technical expertise they are able to maximize their collective utility and effectiveness.

May I also assure you that the current reconfiguration is not inconsistent with the pending legislative proposals and would not have to be undone should it be enacted in the near future.

QUESTION: How much money has the PTO spent to date on this reorganization and reshuffling of personnel?

ANSWER: There has been no money spent on the proposed reorganization which you are referring to.

Commissioner Lehman please submit to this subcommittee a copy of your counsel's legal opinion (referred to in your oral testimony before this subcommittee on March 11) that supports your assertion that the PTO's present "reorganization" activities were part of a reprogramming notice that was disapproved by this subcommittee. Include all supporting documentation from the General Counsel for the Department of Commerce.

Respectively, what were the costs for moving personnel around within the PTO from Fiscal Years 1995 through 1998? Please include the total monetary costs for each year, as well as the time in lost productivity for each year.

The table that follows reflects moving costs for the Patent organization from FY 1995 through the first quarter of FY 1998, along with costs associated with lost productivity. I want to point out that the realignment into Technology Centers coincided with the increased hiring of patent examiners in 1998 and is, therefore, not representative of costs that can be strictly attributed to the reconfiguration of space necessary for implementing Technology Centers.

The table demonstrates that moving costs are positively correlated with the net increase in examining staff. The higher the net increase in examining staff (hires, minus attritions), the more critical is the need to reconfigure space to accommodate new examiners. In 1996, for example, the PTO spent over $3 million to accommodate a net increase of 208 examiners, absent any reconfiguration into technology centers. Similarly, we did not incur moving costs in 1997 since our examiner hiring was limited to replacing attritions in that year. Therefore, given our plan to increase the examiner staff by 430 (650 hires, minus 220 attritions) in 1998, we expect to incur renovation and moving or "churn" costs primarily due to the restrictive configuration of our current