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The National Technology Transfer and Advancement Act
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 April 2006 Feature
Joanne R. Overman is a standards specialist in the Standards Services Division of the National Institute of Standards and Technology in Gaithersburg, Md.
This article is reproduced by permission of the Standards Engineering Society. The article was first published in Standards Engineering, the Journal of the Standards Engineering Society, Vol. 58, No. 1, January/February 2006. For subscription or membership information contact SES, 13340 SW 96th Ave., Miami, FL 33176.

The National Technology Transfer and Advancement Act

10 Years of Public-Private Partnership

The National Technology Transfer and Advancement Act of 1995 (Public Law 104-113), signed into law on March 7, 1996, requires that all federal agencies use standards developed by voluntary consensus standards bodies instead of government-unique standards wherever possible. Perhaps even more importantly, the Act includes provisions that encourage federal agencies to partner with the private sector in the development of standards that not only help improve the efficiency and effectiveness of government, but also strengthen the U.S. position in the global marketplace. As we celebrate the 10th anniversary of the NTTAA, it is appropriate to reflect on what it is, why it was enacted, its implementation, and future activities.

Background

Government agencies help develop and use thousands of private sector standards as well as government-unique standards. The NTTAA addresses a variety of standards-related issues that affect both standards users and developers. The Act strives to increase and improve the interaction and cooperation between the private and public sectors in developing and adopting standards that serve national needs and support trade.

Implementation of the NTTAA has provided the following benefits to federal agencies:

• Eliminates a significant part of the cost to the government of developing its own new standards;
• Decreases the cost of goods purchased by the government;
• Simplifies compliance with agency regulations;
• Encourages government participation in standards developing activities;
• Promotes standards policies that improve U.S. access to global markets; and
• Strengthens government reliance on private sector goods and services.

The NTTAA amended the Stevenson-Wydler Technology Innovation Act of 1980 (Public Law 96-480), the purpose of which was “to promote the United States technological innovation for the achievement of national economic, environmental, and social goals, and for other purposes.” Recognizing the importance of technological innovation in creating economic growth, the NTTAA included a number of statutory changes intended to spur the development and diffusion of innovations within the United States. Specifically, the NTTAA recognizes that standards play a key role in technological innovation and global competitiveness.

The standards-related provisions of the NTTAA’s Section 12, Standards Conformity, were enacted in response to private sector concerns that federal agencies were developing government standards when similar or identical standards already existed in the private sector or could be developed in the private sector with appropriate government input. Private sector stakeholders claimed that the government’s reliance upon government-unique standards greatly increased procurement costs and severely limited the government’s ability to obtain off-the-shelf and state-of-the-art technology.

The U.S. Congress agreed. It passed the NTTAA with its Section 12 provisions that encourage federal agencies to rely upon consensus standards and participate in their development. The Act required the submission of a plan for implementing the provisions of Section 12 within 90 days of enactment of the law. The act also required that the Office of Management and Budget report annually to Congress, explaining any creation of government-unique standards by federal agencies and describing related implementation activities.

NTTAA requirements were implemented by OMB through revisions to its Circular A-119, “Federal Participation in the Development and Use of Voluntary Consensus Standards and in Conformity Assessment Activities.” While many of the requirements of the NTTAA had been part of early versions of the Circular, the enactment of the NTTAA codified them by statute, thereby reinforcing them. The Circular provides federal agencies with guidance in implementing the Act and encourages federal agencies to benefit from the expertise of the private sector, promote federal agency participation in such bodies to ensure creation of standards that are usable by federal agencies, and reduce reliance on government-unique standards whenever an existing voluntary standard would suffice.

The Circular continues to be effective in guiding efforts toward achieving the goals of the NTTAA and the intent of Congress. The extent to which standards are incorporated into federal procurements and regulations is due largely to the ability of standards professionals in agencies to leverage the existence of the law and the Circular to promote use of and participation in the development of voluntary standards.

Responsibilities Under the NTTAA

Section 12 of the Act directs federal government agencies to achieve two main goals. First, the federal government must achieve greater reliance on voluntary consensus standards developed by the private sector. They are to use technical standards that have been developed or adopted by these bodies except where such use is inconsistent with existing laws or impractical. Second, the federal government must decrease its dependence on government-unique standards developed by and for the federal government. The Act also directs federal agency personnel to participate in the activities of voluntary consensus standards developing organizations so that these SDOs remain familiar with the federal needs and governmental positions on standards and consider those needs and positions in their final standards documents. This provision helps to ensure that voluntary standards produced in the private sector will be satisfactory for use by federal agencies in meeting their statutory responsibilities and procurement requirements.

Section 14 of OMB Circular A-119 places a responsibility on all agencies with significant interest in the use of standards to “designate a senior level official as the Standards Executive who will be responsible for the agency’s implementation of (the) Circular” and who will represent the agency in a coordinating committee that monitors compliance with the provisions of the NTTAA. Agencies are also required to report, annually, on their progress in implementing the Act.

The NTTAA directed the National Institute of Standards and Technology, an agency of the Department of Commerce, to transmit to Congress a plan for implementing the provisions of Section 12, which it did in 1997.1 Under the provisions of the Act, NIST is responsible for coordinating standards and conformity assessment activities with other federal agencies, state and local governments, and with the private sector to eliminate complexity and duplication of effort in the development and implementation of standards and conformity assessment requirements and measures. NIST, through its Standards Services Division, is in a unique position to provide coordination and policy input for standards and conformity assessment structures and activities in the United States leading to the development of a realistic, workable technical infrastructure to support the goal of an effective global market.

The OMB Circular assigned NIST the role of leading a coordinating committee that monitors compliance with the provisions of the NTTAA. NIST chairs the Interagency Committee on Standards Policy, which is directed to advise the secretary of commerce and executive branch agencies about standards policy matters. The ICSP, comprising representatives from over 30 federal agencies, reports to the secretary of commerce through the director of NIST. There were 52 members on the ICSP during fiscal year 2005 including agency standards executives, their alternate representatives, NIST support staff, and representation from OMB.

NIST also helps identify instances of redundant conformity assessment activities and provide information that may help save time and money in the certification of products and services. In the Aug. 10, 2000, Federal Register, NIST published “Guidance on Federal Conformity Assessment Activities” to ensure effective coordination of federal conformity assessment activities. The guidelines were prepared with input from an ICSP advisory group. The guide states that “Each agency should coordinate its conformity assessment activities with those of other appropriate agencies and with those of the private sector to reduce unnecessary duplication.”

Each year, NIST collects input on federal agency NTTAA implementation activities and prepares a report for OMB to submit to Congress. This report contains statistics on the use of voluntary consensus and government-unique standards, federal agency participation in standards developing activities, and conformity assessment activities. The first report was prepared for fiscal year 1997 and NIST is currently drafting the fiscal year 2005 report.

To improve information sharing among federal agencies as well as between government and the private sector, NIST created an Internet portal. A major goal of this portal is to provide a one-stop, e-government location for information related to the use of voluntary consensus standards in government. It also serves as a forum for providing ongoing, practical guidance to agencies on standards-related matters. NIST will continue to provide federal agencies with similar tools and information needed to successfully implement the NTTAA.

Where We Are Now

The annual report to Congress submitted by OMB fulfills the reporting requirements of Section 12 of the NTTAA and of OMB Circular A-119 and provides details on the implementation of the NTTAA. It describes federal agency activities related to the use of private sector standards in regulation, procurement and conformity assessment during a fiscal year. In close consultation with OMB, NIST formulates this report based on inputs submitted to NIST by federal agencies in fulfillment of the requirements of OMB Circular A-119. The following information and tables are taken from the fiscal year 2004 report, “Eighth Annual Report on Federal Agency Use of Voluntary Consensus Standards and Conformity Assessment.”

Belinda L. Collins, director of NIST’s Technology Services, comments, “The data collected over the years indicate very real progress in agency reliance on private sector standards and continued strong participation in the process. All those who use standards, and participate in the process of their development, should feel extremely proud of the progress in compliance with the law and Circular. Even more importantly, government involvement means that it understands the intent and content of standards and is committed to their use in both regulation and procurement. The NTTAA has achieved the goal of ensuring that the federal government is a key player in the U.S. standards system.”

Federal Agency Use of Standards
The OMB Circular requires that federal agencies use voluntary consensus standards in lieu of government-unique standards in their regulatory and procurement activities. However, at the discretion of a federal agency, it may decide that using an existing voluntary consensus standard would either be inconsistent with applicable laws or be otherwise impractical to meet the needs of the government.

According to Section 6 of the OMB Circular:

“Use” means the incorporation of a standard in whole, in part, or by reference for procurement purposes, and the inclusion of a standard in whole, in part, or by reference in regulation(s).

“Impractical” includes circumstances in which such use would fail to serve the agency’s program needs; would be infeasible; would be inadequate, ineffectual, inefficient, or inconsistent with agency mission; or would impose more burdens, or would be less useful, than the use of another standard.

The Circular also directs agencies to establish a process for continuing review of their use of standards for purposes of updating such use, including substitution of private sector standards for government-unique standards wherever possible.

Federal Agency Use of Private Sector Standards
This measure provides a count of the total number of private sector standards used by the federal government in a reporting period. Changes in this number from year to year generally reflect the regulatory or procurement priorities and policies of individual agencies during the reporting year.

As illustrated by Figure 2, the total number of private sector standards in use by federal agencies has grown steadily since the initiation of agency reporting under the NTTAA in 1997. In fiscal year 2004, federal agencies used a total of 179 private sector standards for the first time. It should be noted that, because these data include only standards used since the onset of agency reporting under the NTTAA in 1997, the data do not include all nongovernmental standards currently in use by the Department of Defense, a major user of standards, which started its efforts to minimize use of government-unique standards prior to enactment of the NTTAA. Consequently, with 9,156 total private sector standards in use as of the close of fiscal year 2004, DoD continues to lead all other federal agencies in the cumulative use of private sector standards.

Government-Unique Standards Used in Lieu of Private Sector Standards
As illustrated by Figure 3, federal agencies continue to replace government-unique standards with private sector standards in fulfillment of Section 12 of the NTTAA.

The cumulative trend of agency substitution of voluntary consensus standards for government-unique standards is represented in Figure 3. The Department of Defense continues to be responsible for the largest number of substitutions, with 97 in fiscal year 2004. DoD’s standards substitutions address a diverse set of technologies, including metals and alloys, and manufactured parts.

Federal Participation in Private Sector Standards Activities
OMB Circular A-119 states that federal agencies “must consult with voluntary consensus standards bodies, both domestic and international, and must participate with such bodies in the development of voluntary consensus standards when consultation and participation is in the public interest and is compatible with their missions, authorities, priorities, and budget resources.” The Circular goes on to declare that “agency support provided to a voluntary consensus standards activity must be limited to that which clearly furthers agency and departmental missions, authorities, priorities, and is consistent with budget resources.”

Federal Agency Employees Participating in Private Sector Standards Activities
Figure 4 shows a decrease in employee participation in private sector standards bodies, although the level of participation in fiscal year 2004 is not far different from past levels of participation. Most agencies reported little or no change from fiscal year 2003 to fiscal year 2004. The Department of Energy, the General Services Administration and the Department of Commerce increased their employee participation during this reporting period, however, the Department of Health and Human Services, the Department of Interior, and the Department of Agriculture decreased their levels of employee participation. No specific reasons were reported for the decreases in individual employee participation; however, as with participation at the agency level, employee participation is affected by the availability of both human and financial resources.

In some cases, resource constraints oblige an agency to focus attention on its highest priority activities and to strive to make its participation in those activities as effective as possible. Other factors affecting federal employee participation levels include competing organizational priorities as well as personnel changes, workplace attrition, and retirements, all of which make it difficult for agencies to maintain constant levels of participation as well as accurate records of their activities. One agency participated in several hundred standards development activities in well over 100 private sector standards bodies. However, the exact number of employee participants was not known since the agency lacks an established procedure to gather this information.

Federal Agency Conformity Assessment Activities
Federal conformity assessment activities are means of providing assurance that the products and services regulated or procured by federal agencies have the required characteristics and/or perform in a specified manner. Agency conformity assessment procedures may include sampling and testing, inspection, accreditation, certification; licensing; product listing; the submission to an agency of manufacturing, operational, and related data for review; manufacturer self-declaration of conformity to agency requirements; mandatory labeling and advertising requirements; the establishment of national requirements that are adopted or enforced at state and local government levels; the issuance of regulatory guidelines; pre-marketing approval requirements; post-marketing monitoring requirements; and the conduct of environmental impact assessments.

Challenges and Opportunities
As in past years, federal agencies continue to experience significant personnel turnover at all organizational levels due to reorganizations, accelerated or early retirements, and normal attrition. As in industry, these changes make it very difficult for federal agencies to retain high-level managers who appreciate the importance of standards and who visibly support standards-related activities. Likewise, due to staff turnover, federal agencies also continue to struggle to retain “institutional memory” of past standards policies, responsibilities, and practices. Also, shrinking budgets and competing organizational priorities cause agencies to make difficult choices, often leading to reduced participation in standards development activities.

As Mary Saunders, chief of NIST’s Standards Services Division and current chair of the ICSP, notes, “I continue to be impressed with the level of commitment of agency standards executives to ensuring that agency management and staff are aware of their obligations under the NTTAA and understand the benefits associated with using voluntary consensus standards, both for the agencies themselves and for those who are subject to regulation or who do business with the government. Government agencies have made tremendous progress in the past decade in increasing their reliance on voluntary consensus standards, with all of the attendant benefits that this presents, both in terms of increased efficiency and improved flexibility.”

During fiscal year 2004, representatives from several ICSP member agencies participated in strategy meetings in concert with several voluntary consensus standards developers and representatives from the American National Standards Institute and OMB. The purpose of these meetings was to gather input from key organizations having a stake in successful implementation of the NTTAA. This input would then serve as the basis for NIST strategic plans designed to advance the principles of the NTTAA and the OMB Circular. The stakeholder group identified specific outcomes that, if achieved, would lead to substantially increased use of voluntary consensus standards and participation by federal agencies in the activities of standards developing bodies. For example, high-level federal agency leadership was identified as the primary driver of successful NTTAA implementation because agencies have the ability to direct policy and resources in ways that bring about other desirable outcomes such as increased federal participation and collaboration with the private sector.

Ultimately, this cooperative stakeholder effort represents an opportunity to redirect and focus the efforts of key players in ways that can maximize the benefits of NTTAA implementation for both public and private sector organizations. To enhance this effort, it was decided that future meetings of the NTTAA stakeholders group should involve participants from private industry so that interests and perspectives of that critical group can be incorporated into future strategy and action plans.

Sound economic analysis to demonstrate the benefits of greater use of private sector standards and conformity assessment activities is essential for making the case for federal agency leaders to intensify their agencies’ activities in these areas. However, capturing this important information has thus far proven to be extremely difficult. The NIST-sponsored study, “Measuring the Benefits of the National Technology Transfer and Advancement Act,” which was conducted in August 2004 by RTI International, points to (1) a lack of useful data necessary to support economic analysis, and (2) the difficulties federal agencies face in gathering data that can be used to estimate economic benefits broadly across the federal government. Consequently, there are real opportunities for advances in methods and techniques that can be employed to demonstrate the real economic benefits of NTTAA implementation.

However, in some cases, agencies are able to demonstrate clear economic benefits as well as qualitative benefits on a case-by-case basis. The Department of Defense has created several case studies that demonstrate a range of positive results from its collaborations with the private sector on standardization issues. Some of DoD’s documented benefits include:

• Reduced labor costs to operate and maintain equipment;
• Lower inventory costs;
• Improved safety;
• Improved equipment readiness; and
• Enhanced interchangeability, reliability, and availability of equipment and parts and better equipment performance.

Federal agencies are able to point to specific instances where they have benefited from NTTAA implementation in ways that cannot be measured in dollars. For example, one indicator that the NTTAA is receiving more widespread consideration within the Environmental Protection Agency is the “beyond-regulation” use that EPA is making of voluntary consensus bodies and of ANSI in particular. EPA leaders in environmentally preferable procurement acknowledged the important role of voluntary consensus organizations for the development and promulgation of standards for environmentally conscientious products. EPA partnered with ANSI to educate and train standards organizations in the need for such environmental products. Together, they provided organizations with criteria that can serve as a guideline for use in committee work where standards and/or testing procedures for these products are developed. ANSI conducted several workshops and training sessions in cooperation with EPA and posted information on ANSI’s Web site.

Federal agencies are reaping significant benefits from their current use of private sector standards and participation in private sector standards and conformity assessment activities. There is evidence to suggest that enhanced activities in these areas will lead to even more positive results, both economic and otherwise, for federal agencies that comply with the NTTAA and OMB Circular A-119. Greater efforts to document these positive results could prove to be the key to full realization of the potential benefits of NTTAA compliance.

By using non-government standards, participating in standards developing activities, and working to avoid unnecessary duplication of standards developing and conformity assessment activities, organizations implementing the NTTAA will contribute to a more coordinated regulatory process and competitive business environment. //

References
1 The National Technology Transfer and Advancement Act – Plan for Implementation, B. Collins, January 1997, NISTIR 5967

Bibliography
• “Eighth Annual Report on Federal Agency Use of Voluntary Consensus Standards and Conformity Assessment,” K. McIntyre and M. Moore, NISTIR 7227, May 2005
• “Implementation of the National Technology Transfer and Advancement Act, Section 12: An Assessment,” J. Schweiker, Consultant, December 2003
• “Measuring Benefits from the National Technology Transfer and Advancement Act,” W. White, RTI International, August 2004
• DoD case studies can be obtained from the Defense Standardization Program website at www.dsp.dla.mil.
• For additional information on the NTTAA, click here.
• For additional information on NIST’s Standards Services Division, click here.

 
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