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How hard will Y2K bug hit feds?

John Koskinen, the recently appointed chairman of the President's Year 2000 Conversion Council, talks about the Y2K bug's impact on the federal government.

This week, the federal Office of Management and Budget warned that several federal agencies are in danger of missing a deadline to fix Year 2000 computer system problems, which will cost millions of dollars more to fix than originally thought. Will the Year 2000, or millennium, bug bring the government to its knees? CNET's NEWS.COM asked this question to John Koskinen, the recently appointed chairman of the President's Year 2000 Conversion Council.

NEWS.COM: What would some of the consequences be if one of these departments doesn't make the deadline?
Koskinen: We are a country that is dependent on technology systems. There will be some consequences, but I do not see whole systems failing. I think organizations will have difficulties closing some transactions. It will be patchy, or geographical, not whole systems.

Many have criticized the government for dragging its heels on this issue. What do you say to those critics?
At this juncture every agency is taking this problem very seriously. I'm less concerned with the past and more interested in where do we go from here. What I hope the council will do is coordinate the efforts going on now. I'm more concerned with areas where the government doesn't have any jurisdiction. I hope the council will provide leadership to these areas as well.

Is the White House considering legislation to make sure agencies meet the deadline?
Our goal is not to regulate how agencies do this. [The council] wants to assist them as they go through this process. There may be a need for specific legislation for particular problems, but not any systemic legislation. There is some legislation that has been passed to clarify regulatory powers. A bill was recently passed that gives more regulatory authority to the Office of Thrift Supervision (OTS) and the National Credit Union Administration (NCUA). That sort of legislation is necessary.

It seems there are at least two different congressional subcommittees looking into the Year 2000 problem. Would you support establishing a single committee, tasked specifically with addressing the issue?
A select committee would be helpful, but it's a complicated problem. I think different institutions and areas have different issues to face, so I think subcommittees that regulate those are needed to address their particular needs. But I think anything that would help focus efforts and give more assistance to agencies dealing with the problem is helpful.

Some were expecting the last quarterly report from the Office of Management and Budget to be the one wake-up call to get politicians on the hill to recognize the Year 2000 problem as a real one. The report said the cost to fix government systems will be millions more than originally thought, and another department was put on the list of those who may fail to meet the deadline. Did this report surprise you at all?
I think there will be incremental costs to fix this problem. But financing is not the problem. We can budget that over the next two years. This is a project management issue. As a council, we need to help agencies with their projects, allow them to assist other institutions to deal with the issue as well. I've asked all agencies to do three things: Look at their internal systems, then their interface with third-parties, and finally what those other parties are doing to handle the problem. There are areas where government has no jurisdiction. For example, we can work directly with the Department of Energy, but we have no control over the public utilities. But we need to be there to assist them as well.