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A recent press release by your Department announced that the
Office of Education is soliciting proposals from private collection
organizations to assist in the task of collecting defaulted federally
insured student loans. As I understand it, this action is being
taken pursuant to an authorization contained in section 430 of P.L.
94-482, "the Education Amendments of 1976", which also charges the
Comunissioner of Education with assuring that the actions of contractors
are fair and reasonable and do not involve harassment or intimidation.

It would be most helpful if you would provide the subcommittee
with an explanation of how HEW intends to comply with the requirements
of the Privacy Act and the Education Amendments of 1976, as they relate
to the loan default collection effort. In this regard, it would be
useful for us to know HEW's view relative to the ownership of the
information provided to and/or gathered by contractors; what safeguards
will be incorporated into the contract(s) to limit misuse of information
by collection agencies; what provisions are contemplated for ultimate
disposition of information provided to and/or gathered by contractors;
how compliance with the "fair and reasonable" collection requirement
will be monitored; and what penalties will accrue to contractors who
either misuse information and/or use unfair and unreasonable collection
techniques.

Sincerely,

Richardson Preyer
Chairman

APPENDIX 3.-JUNE 1, 1978, LETTER TO AGENCIES ENCLOSING QUES

TIONNAIRE ON OWNERSHIP, USE, AND DISPOSITION OF CONTRACTOR DATA

NINETY-FIFTH CONGRESS
Congress of the United States

house of Representatibus
GOVERNMENT INFORMATION AND INDIVIDUAL RIGHTS

SUDCOMMITTEE

one
COMMITTEE ON GOVERNMENT OPERATIONS
Marmunn House Omnia Bulbina, Room L-

MBC
WASHINGTON, DC. 2018

rume 1, 1978

The Honorable

Department of
Washington, D. C.

Dear

The House Subcommittee on Government Information and Individual
Rights is studying the ownership, uses and disposition made by con-
tractors of records and data developed in pursuit of government con-
tracts and what Federal policies exist governing such ownership, uses,
and disposition. Our study includes collateral uses made of this
information apart from the specific purposes for which it was developed
under the contract, and what use and disposition contractors make of
the information after the contract has ended. While our concern
focuses mainly on personal information and policies safeguarding its
misuses, we are also concerned with the use and disposition of other
information such as scientific, technical, and financial data developed
under government contract.

Our preliminary findings indicate that no uniform Federal policies
exist_governing the use and disposition of such contractor data, nor do
most Federal agencies appear to have specific policies, guidelines, or
contractual provisions treating collateral use and ultimate disposition.
We are aware that Federal regulations provide guidance for storage of
contractor financial records for use of rights-in-data clauses where
patents and copyrights are potentially involved, and for disposition of
classified information. However, our primary focus is on contractor
records and data which are not covered by these regulations.

To pursue our study of this issue and to prepare a timely report, we need additional information and believe the brief questionnaire attached will provide that information with minimal effort from your department. We need your reply by June 23rd in order to complete our study. If you feel you cannot respond by then, please call me or subcommittee Staff Director, Timothy H. Ingram, to discuss an alternate date.

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QUESTIONS FOR FEDERAL DEPARTMENTS ON
USES AND DISPOSITION OF INFORMATION

DEVELOPED BY FEDERAL CONTRACTORS

1. Does the department have a policy on contractors' collateral uses and

disposition of records and data ? If so:

a. Provide copies of departmental directives, memos, regulations, etc., as appropriate. (Please send only the applicable portions of the regulations.)

b. Do your policies differ for educational and not-for-profit institutions as compared with for-profit contractors? If so, explain

the difference.

c. How do you assure contractor compliance with the policy?

d. Do you feel that contractors should or should not be required to certify in writing their compliance with Federal policy?

2. If the department does not have a policy as described in Question 1 above:

a. Does the department believe that specific policy guidelines on

ownership, use, and disposition of data are needed to protect government

interests and individuals' rights to privacy. Why or why not?

b. Does the department plan to address this matter in the near future?

3. What is the department's policy on the ownership of data assembled by

contractors including data related to, but not part of, the final product?

4. Do most department contracts contain clauses specifying who owns the

data, how it can be used, and the ultimate disposition of the data (for

example: return to the government, destroy, strip personal identifiers)?

If so:

a. Are these clauses placed in contracts routinely or on a

case-by-case basis?

b. Do these clauses prohibit the contractor from retaining copies of

the records and data which he is required to destroy or return to

the government?

c. Who is responsible for determining that these clauses are appro

priate to a given contract?

d. Provide representative examples of the contract clauses.

5. Are you generally aware of situations in your department where a contractor,

having developed a data base for one contract, uses the same information for other contracts with government or private industry? If so:

a. Is this done with or without the concurrence of the department?

b. Cite examples where this practice is occurring.

6. Can you cite examples of subject areas where the Federal government and

private contractors disagree over ownership, use, and/or disposition of records and data? Briefly describe the disagreement in each case.

7. Please provide any other views you may have regarding Federal policy

on the use and disposition of information in the possession of Federal

contractors.

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Your June 1, 1978, letter requested information regarding the ownership, uses and disposition made by contractors of records and data developed in pursuit of Government contracts.

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