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PREPARED STATEMENT OF DAVID F. LINOWES, CHAIRMAN OF THE

PRIVACY PROTECTION STUDY COMMISSION

Madame Chairwoman and Members of the Subcommittee:

I am David F. Linowes, Chairman of the Privacy Protection

Study Commission.

My purpose in being here today is to testify

on behalf of the Commission's request for amendment of Section

9 of the Privacy Act of 1974 to remove the current $750,000

fiscal-year limitation on Commission expenditures, and to in

crease the Commission's total authorization from $1,500,000 to

$2,000,000.

I hope that as

a result of my appearance today

you will agree with us that the adoption of these measures is necessary if the Commission is to fulfill the formidable man

date the Congress gave it in Section 5 of the Privacy Act of

1974.

Removal of Fiscal-Year Expenditure Limitation

I would like to speak first to the matter of the fiscal

year expenditure limitation.

Section 9 of the Privacy Act pro

hibits the Commission from expending more than $750,000 in any

one fiscal year.

Since the current fiscal year does not end

until September 30, 1976, that means that we are prohibited from spending more than $750,000 over a 15-month period, even though the Congress has now appropriated a total of $1,000,000

for the Commission in FY '76.

Moreover, the fiscal-year expen

diture limitation has deprived us of any discretion to allocate

funds from one fiscal year to another, even though our

Commission's life is but a mere

two years.

I understand that

it is not unusual for a limited duration commission such as

ours co be free to allocate the total amount of its authorized

funds during the course of its life and we also have found no

legislative history--formal or informal--which indicates that

the Congress wanted to deprive the Commission of the ability to do so. We, therefore, hope that you will agree that the fiscal-year limitation in Section 9.should be eliminated.

Increase in Total Authorization

Section 9 of the Privacy Act places a total authorization

limit of $1.5 million on the Commission.

This simply is not

enough to accomplish the work that Congress has set out for

the Commission.

Accordingly, we

are seeking an increase in

our authorization from the current $1.5 million to $2 million

for the entire two-year period.

This would allow us

to receive

the $250,000 FY '76 supplemental recently appropriated for us

without prejudice to our $750,000 appropriation request for

FY '77.

In addition, it would allow us

to request an FY '77

supplemental of approximately $100,000 which we know we need

to complete our study program, and also provide us with a small

margin of funding to cover two contingencies: (1) the need to publish an edited version of the transcripts of particular

Commission hearings should Congress or others request it; and
(2) the need to provide for additional meetings of the Commis-

sion and selected experts in March and April, 1977 should that

be required for the Commission to complete its deliberations.

Before giving details on how we plan to spend the additional

monies we are seeking, allow me to explain briefly our appropriation

status.

At its February 13, 1976 meeting the Commission unanimously

voted to request an FY '76 supplemental appropriation in the

amount of $380,781, to seek an FY '77 supplemental appropriation in the amount of $94,191, and to seek the authorization

change that is the subject of this hearing.

These requests

were formally submitted to the Office of Management and Budget

and the Congress on March 10, 1976.

Thereafter, on March

23, 1976, the President submitted to the President of the

Senate his second FY '76 supplemental budget request, which included $250,000 for the Commission. This additional sum

was approved on May 21, 1976, as part of H.R. 13172, Second

Supplemental Appropriations Act, 1976, with the proviso that

it shall only be available to the Commission upon the enactment

of authorizing legislation.

The $250,000 approved supplemental was $131,000 less than

the Commission had originally requested.

We believe that we

can operate with that sum for the remainder of FY '76.

How

ever, the Commission will need supplemental funds of approximately $100,000 for FY '77 in order to complete its study

program.

The FY '76 supplemental and the needed FY '77

supplemental will together place the Commission budget at

$350,000 over the current authorization ceiling.

This was

contemplated by OMB as recognized in their support of our

requested authorization increase to $2 million.

We hope to

convince you that these additional funds are crucial.

The Commission's Mandate

The principal charge to the Commission is to make a

thoroughgoing study of the "data banks, automated data processing programs, and information systems of governmental, regional, and private organizations," and as a result of such study to recommend to the President and the Congress the extent, if any, to which the principles and requirements of the Privacy Act of 1974 should be applied to organizations to

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In addition, Section 5 of the Privacy Act requires the

Commission to inquire into and report on

Whether an individual should have a right in

law to have his name removed from a mailing

list he (or she) does not want to be on;

Whether the Internal Revenue Service should be

prohibited from disclosing individually iden

tifiable data to other Federal agencies and

agencies of State government;

Whether Federal agencies should be liable for

general damages if they willfully or intention

ally violate the Privacy Act of 1974;

Whether and how the security and confidentiality

requirements of the Privacy Act should be ap

plied when a record is disclosed to an individual

or organization that is not subject to the Act;

and

Whether and to what extent, if any, information

systems affect Federal-State relations and the

separation of powers.

The Congress also expressly authorized the Commission to include in its inquiry interstate transfers of information about in

dividuals; information systems that affect individual rights

other than the right to personal privacy; uses made of the

Social Security number and other standard universal identifiers;

the matching and analysis of statistical data with personal information gleaned from other, non-statistical sources; and the personal-data record-keeping practices of organizations in the fields of medicine, insurance, education, employment, travel, hotel, and entertainment reservations, credit, banking, consumer reporting, cable television, and electronic funds transfer.

Furthermore, in carrying out studies in any of these areas, the Commission is required not only to document the standards and procedures now in force for the protection of personal

information but also

to determine what laws, Executive Orders, regulations, directives, and judicial decisions govern the activities under study;

to assess the extent to which those legal foundations are consistent with "the rights of privacy, due process of law, and other guarantees in the Constitution;" and

to collect and utilize, to the maximum extent possible, the findings, reports, studies, hearing transcripts and recommendations of executive, legislative and private bodies, institutions, organizations, and individuals which pertain to the problems under study.

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