filmed the numerical registers containing the manually posted records of retirements of Series E paper issues. The film could be used in high speed information systems, thus helping to reduce the space and employees needed in the Chicago Office. 36

After the introduction of punch-card bonds, several large issuing agents began using computers to print new issues. A study was made to determine if the magnetic tapes used in the process could be employed in reporting bond sales. In 1964 the Army Finance Center in Indianapolis became the first issuing agent to report its sales in this manner. 37 The Navy Bureau of Supplies and Accounts and the Air Force Accounting and Finance Center began reporting in the same way in 1966. 38 Within 10 years, 10 Federal Reserve Banks, 6 Treasury Disbursing Offices, 7 military installations and 11 private companies were using automated reporting equipment, accounting for about 26 percent of total Series E bond sales. 39

Efforts to improve the computer operations continued throughout the 1960s. In 1964, a second H-800 computer was acquired, along with a Honeywell H-200 computer. Some typical improvements made during this time (with their annual savings) were:

June 1963, programming of various housekeeping operations from manual to computer handling ($20,910);

• July 1965, electronic printing of Adjustment Advice Form PD 2792 ($34,000);

• April 1967, automation of Series H interest accounts and check writing ($132,000); and

• January 1968, installation of NCR 735 Encoders that allowed for direct entry of data to magnetic tape, replacing the key punch and verifying machines in Retired Paper Bond Sub-unit ($40,069). 40

In 1967, with computer operations at Parkersburg running smoothly, it was decided that some operations in Washington could be converted to electronic data processing methods. Several computers were being

Bureau of Public Debt, Description of Parkersburg Office Responsibilities and Functions, (Washington, D.C.: Memo dated October 18, 1874).

40 Bureau of the Public Debt, Draft Memo P.D. 2694 (8.57), (Washington, D.C.: BPD, April 1976), 3-6.

evaluated by the end of the year. 41 Whenever automation takes place, there is always a fear on the part of employees that their jobs might be lost. But changes in technology can create new jobs even as they eliminate old ones. The Bureau was committed to see that employees were able to take advantage of the new careers opening up in automated data processing. As H.J. Hintgen, then Deputy Commissioner, informed all employees at the Bureau,

We foresee no cause for concern about continued employment on the part of an employee. In fact the introduction of the EDP system will open opportunities in a new and challenging field for employees who are interested and qualified. We expect to fill most, if not all, of the positions related to the EDP system through training and reassignment of present Bureau employees. 42

The system was fully operable by 1969, and was used to perform public debt accounting and other operations that previously had used conventional tabulating equipment. 43

Automated data processing also improved operations at the Chicago Office. In 1968, through the purchase of a used computer from the Federal Reserve at a savings of $450,000, the Bureau was able to automate the interest accounts of Series H and K bonds, which required the servicing of 1.6 million current interest payment accounts. Labor time to handle the accounts was reduced in half, 89 employees could be used elsewhere and 13,000 square feet of prime Chicago Office space was released-giving a combined annual savings of $600,000. 44

Operational Improvement

In addition to the administrative efficiency gained through the changes just mentioned, the Bureau responded to the pressures it faced with a number of small changes in its operations that added up to further improvement. While many of these changes were related, they can be better gauged by considering them in separate categories of Employment Suggestions, Service, Book-Entry and Organizational Changes.

41

Secretary, Annual Report, 1967, 88.

42 H.J. Hintgen, Memo to all employees, BPD, June 16, 1967.

43

44

Secretary, Annual Report, 1969, 96-97.

U.S. Treasury Department, Progress in Management Improvement, Pamphlet, (Washington, D.C.: FY 1968), 9.

Employee Suggestions:

46

Some of the operational improvements made at the Bureau during the 1960s came from employee suggestions. In 1961 an employee incentive awards program encouraged 204 suggestions from employees; the Bureau adopted 103 of these for an estimated savings of $23,010, paying $1,745 in cash awards. 45 During 1963, 45 employee suggestions, resulting in savings of $19,963, were put into place. In 1968 Mrs. Golden Skeen of the Parkersburg Office was specially cited for suggesting a way to automate the printing of shipping dates on bond stubs received each day at the Parkersburg Office. Since over 2.5 million stubs were being received annually, this was a significant improvement that saved over $6,300 per year.

Service:

47

Service to the public was also improved during the 1960s. In 1961 a new procedure was devised for direct submission of requests for replacement of Savings Bonds to the Parkersburg Office on a special form. The new procedure eliminated paperwork and reduced the time it took to issue a replacement bond. 48 In 1962 the procedure for replacing Savings Bonds was changed to allow for the issuance of a check for the redemption value of the bond when the owner requested it. Previously, a duplicate Savings Bond was first issued and then redeemed for payment. Elimination of this step also saved bondowners time in receiving their replacements. 49

Book-Entry:

On January 1, 1968, regulations were put into place for the use of book-entry Treasury securities. Securities in book-entry form would consist of transferable Treasury bonds, notes, bills and certificates of indebtedness. Under the new system, these securities would be recorded as entries in the accounts of the Federal Reserve Bank that issued them instead of as definitive securities issued in the

form of printed pieces of paper. The system, which had been the subject of a 4-year joint study by the Treasury and the Federal Reserve, had as its purpose the reduction of the amount of paper work involved with government securities transactions. Initially, the system was only available for transferable Treasury securities deposited with a Federal Reserve Bank as collateral for Treasury tax and loan accounts, as collateral for the deposit of public money, or for safekeeping or collateral by a member bank. All transferable Treasury securities held for Government Investment Accounts were deposited with the Federal Reserve Bank of New York to be held in book-entry form. Special Treasury issues held by Government Trust Funds were also established into book-entry form, with their accounts being maintained by the Bureau of the Public Debt. Studies were also being made of how feasible it would be to convert other classes of securities to book-entry form. 50

In 1969 the book-entry system was expanded to include U.S. Savings Bonds issued to trustees of certain employees' thrift and savings plans. In this case, the system would allow for the change of securities from book-entry to definitive form and reverse, as the need arose. Still, the Bureau gained the advantage of a reduced number of securities to process. 51

Organizational Changes:

Several organizational changes also took place at the Bureau during the 1960s. In 1962 three sub-units in the Division of Loans and Currency Branch in the Chicago Office were reorganized; the Numerical Register Section of the Division of Retired Savings Bonds was abolished; and in the Washington Office, the Securities Transactions and the Claims sections of the Division of Loans and Currency were merged. 52

An important step was taken in June 1963 with the formation of the Management Analysis Office. The new office replaced the Methods and Procedures Office, but its responsibilities had evolved greatly over the years. At this point, the Management Analysis Office would provide all parts of the Bureau with management counseling and advisory service, identify projects for management

improvement, analyze organizational effectiveness, revise methods and procedures of operation, conduct management surveys and undertake research into new managerial ideas and techniques. 53 An organizational chart of the Bureau as of March 31, 1966, is given in Figure Nineteen.

On July 1, 1969, a Division of Data Processing was put in place to operate the Washington Office computer facility; the new division would also serve as advisor to the Commissioner on automated data processing, interact with other Treasury bureaus and government agencies in terms of joint data processing, and would act as a resource center for the Bureau in continually monitoring changes in data processing methods and equipment. 54 Figure Twenty presents an organizational chart of the Bureau as of March 31, 1970.

53 H.J. Hintgen, Memo to D.M. Merritt, (Washington, D.C.: Bureau of the Public