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Nation still not ready for Y2K, report says

Many critical organizations nationwide are not fully prepared for the Year 2000 computer problem, according to a report due out next week.

Many critical organizations nationwide are not fully prepared for the Year 2000 computer problem, according to a report due out next week.

The report, prepared by the Senate Special Committee on the Year 2000 Technology Problem, Back to Year 2000 Index Page warns that many organizations are still not directly dealing with problems associated with the Y2K bug, according to a draft copy of the report obtained by CNET News.com.

The report represents one of the most comprehensive assessments yet by the federal government on the state of preparations to deal with the Y2K problem.

Based on hearings held before the Senate special committee on Y2K since its inception last April as well as on-site queries by Senate investigators, the report found Y2K efforts in the healthcare, oil, education, farming, food processing, and construction sectors to be insufficient.

The report finds that over 90 percent of doctors' offices and 50 percent of small and medium-sized businesses have yet to address the computer problem.

Larger firms have, in general, grasped how a Y2K-related failure could severely impact their businesses and have taken steps to remedy the problem. Smaller firms, the report said, remain focused on what they say are more immediate concerns--which in many cases do not include Y2K issues.

The report criticizes self-reporting as an unreliable way of assessing industry sectors, comparing it to allowing students grade their own tests. Nonetheless, self-reporting has become the standard in both private industry and government. Unfortunately, the results of many surveys have been kept from public and committee view. Despite a Securities and Exchange Commission rule requiring disclosure by public corporations, many companies are still reluctant to report poor compliance levels.

The Y2K problem has become a hot issue within the federal government, sparking debate between Republicans and Democrats about the severity of the problem, the role of government in fixing the problem, and litigation protection for companies that fail to appropriately prepare for the problem.

"As one examines the multiple layers of systems and technologies that support our everyday lives, the potential Y2K problems increase exponentially," the draft report said. "The interdependent nature of technology systems makes the severity of possible disruptions difficult to predict."

The Year 2000 problem, also known as the millennium bug, stems from an old programming shortcut that used only the last two digits of the year. Many computers now must be modified or they may mistake the year 2000 for the year 1900--and may not function, causing widespread disruptions in services in the transportation, financial, utility, and public safety sectors, some observers warn.

The Senate committee report also concludes that more legislation may be necessary to address the threats of Y2K litigation, citing liability cost projections near $1 trillion. "Serious doubts exist as to whether or not the present judicial system could handle a potentially monstrous wave of litigation," the report read.

The complete report will be released during a press conference in the capitol building on Tuesday, committee aides said.