y Rajiv Chandrasekaran, Eric Lipton and Stephen Barr Washington Post Staff Writers Wednesday, September 22, 1999; Page A1 With 100 days to go until the world's computers face their long-awaited moment of electronic judgment, most large U.S. corporations and government agencies say they have almost completed the painstaking and costly chore of inoculating their machines against the "millennium bug." As a result, technology specialists, industry executives and government officials alike now are increasingly confident that ordinary Americans will enter the new year with few electronic disruptions in crucial public services, including electric power, water, telecommunications, transportation, banking, food distribution and important government operations. The primary remaining doubt concerns one element technicians can't fix: human nature. A rush to withdraw large amounts of cash or to fill cars with gasoline or pantries with food could temporarily deplete grocery-store shelves, automated teller machines, pharmacies and gas stations. Overall, everyone from White House Y2K czar John A. Koskinen to workers who have spent the past three years in windowless cubicles, trolling through million-line computer programs for potential date glitches, continues to compare the impact of Y2K to that of a powerful winter storm: severe -- but short-term -- disruptions for a limited number of communities. A Senate report scheduled for release today predicts that "the Y2K problems will hit sporadically . . . and will cause more inconveniences than tragedies." The report goes on to say that "no one knows for sure exactly where those outages will be or how long they will last." But it points out that many small companies in the United States, as well as foreign businesses and governments, have been slow to address the year 2000 glitch. As far as the Washington area is concerned, corporate leaders, federal officials, and state and local governments say they are largely prepared. "We can handle Y2K today," said Bill Mistr, Virginia Power's Y2K coordinator, noting that 81 of the company's 84 power-generation facilities are ready -- enough to provide electricity for all of the utility's customers. Potomac Electric Power Co. says it has completed repairing and testing all of its critical computer systems. Bell Atlantic Corp. says it, too, is finished with fixing its "mission-critical" systems and plans to spend the remaining 100 days working on other, less important computers. The region's two largest banks, Bank of America and First Union Corp., have wrapped up Y2K repairs on crucial systems and are devoting the rest of the year to additional testing. Metro and the region's largest water utilities also say they are essentially Y2K-proof. "We're ready to go," said Skip Patterson, executive director of Bell Atlantic's Y2K office. "And there's nothing we're seeing in all the tests we've been conducting that diminishes our confidence." Virginia and Maryland and the region's 14 major local governments also profess a growing degree of Y2K bravado. Only Alexandria, the District, and Anne Arundel and Fauquier counties report being less than 90 percent complete on their critical Y2K work. Even in the District, where the repair effort did not begin in earnest until 15 months ago, officials say the new year should come without chaos. Even if everything isn't finished on time, the city has built an extensive web of backup systems. Police officers, for example, will be stationed at 120 locations across the city to take emergency requests for service in person, in case the dispatching system or telephones fail. "There will be a climax at midnight, when we go, 'Five, four, three, two, one,' " said D.C. Mayor Anthony A. Williams (D). "But it won't be a climax of all the lights going out and utter chaos. . . . All the processes, services and systems people expect in our modern society here in the District are going to continue." Years-Long Effort Predictions that New Year's Day 2000 will pass without widespread disruptions across the nation come only after an unprecedented mobilization of people, money and executive attention. For the past two years, large corporations have each reassigned hundreds of workers to test systems, hired dozens of technical consultants to reprogram machines and purchased millions of dollars' worth of new electronic equipment. The year 2000 problem, commonly known as Y2K, stems from the fact that millions of computers, as well as microchips in many electronic devices, were programmed to recognize only the last two digits of a year, assuming that the first two would be 1 and 9. On Jan. 1, unprepared machines will understand the year "00" not as 2000 but as 1900, potentially causing them to shut down or stop working properly. Estimates of what U.S. corporations have spent to deal with Y2K vary widely, but most agree it is the largest single technology investment in history. The Federal Reserve has placed the price tag at $50 billion, and some industry analysts believe the actual figure is more than twice as much. All told, some analysts predict the global repair bill will reach $500 billion. The federal government, which has scores of antiquated systems that needed intensive repair work, now estimates its bill will total $8.3 billion. "This has been an enormously costly, complex and time-consuming effort," said Dan Zivney, Y2K director at Fairfax-based Mobil Corp., which has devoted $185 million and 250 employees since 1997 to its date-repair project. The task included testing and fixing thousands of computers and electronic devices -- such as digital temperature controllers in oil refineries -- at more than 150 locations around the world. Then there was the challenge of monitoring the progress of 5,000 other firms that supply products to Mobil. The petroleum giant has now finished its repair work and is focusing on "contingency plans" -- what to do if, despite all the testing, some computers fail in the new year," Zivney said. "With the myriad elements of the Y2K problem, it would be foolish on my part to say that we've captured and fixed every single thing. But the task now is to ensure that if we have a blip on the screen, it's not going to cause a disruption." Zivney said Mobil, like many other corporations and government agencies, plans to spend the next 100 days conducting additional testing and drills to simulate problems and run through manual override procedures. "We feel very confident about where we are," he said. "But we're not going to stop preparing." The same sort of progress is being reported by firms in every corner of corporate America. In the grocery industry, Giant Food Inc. and Safeway Inc. largely have finished their Y2K repairs and also now are focusing on contingency planning. So are CVS Pharmacy Inc. and Wal-Mart Stores Inc. In the telecommunications industry, AT&T Corp. and MCI WorldCom Inc. have completed the technical work and are concentrating on "business resumption plans" in case of unanticipated problems. And in the financial services industry, brokerage houses including Merrill Lynch & Co. and Salomon Smith Barney have told federal regulators that they are done with reprogramming and testing their computers. Industry analysts say they are heartened that so many companies actually have met their targets, particularly because computer-related projects have a reputation for missing deadlines. "The results are very reassuring," said Ann K. Coffou, an analyst with the Giga Information Group, a consulting firm in Cambridge, Mass. "This gives them more time to find and prepare for anything they may have overlooked." Quick Turnaround Eighteen months ago, congressional investigators and technology experts figured the Federal Aviation Administration, long known for botching computer projects, would never finish its Y2K work in time. The agency's repairs were so far behind schedule and so mismanaged, congressional auditors warned in early 1998, that many airline flights in the year 2000 would be delayed or canceled. This summer, the FAA silenced its critics. The agency wrapped up its Y2K repairs in June and staged a public test to show that air-traffic control systems would work in 2000. The story has been the same throughout most of the federal government. With more than 6,340 mission-critical systems to fix and repairs to vital programs, such as Medicare, off to a late start, congressional Republicans last year gave the Clinton administration a "D" for its Y2K efforts. But the government mounted a late rally, finishing the bulk of its work in March, months ahead of many large corporations. Earlier this month, the White House budget office reported that 97 percent of the government's critical systems were Y2K ready. The Senate report released today notes that "most of the federal government is crossing the finish line." The government's mobilization has been led by Koskinen, a presidential assistant who is chairman of the President's Council on Year 2000 Conversion. Koskinen created 25 working groups that included executives from corporations and trade associations to identify and encourage Y2K repair work not only inside the bureaucracy but also with states and localities that electronically exchange data with the government. "While we're not guaranteeing perfection anywhere, we are very confident that whatever difficulties are generated by the Y2K problem won't be the result of the failure of federal systems," Koskinen said yesterday. 'A $10,000 Bet' Assuming power, telephone and other major utilities do not falter, the region's state and local governments are nearly unanimous in their high level of confidence that there will not be major disruptions in their operations as a result of the Y2K bug. Virginia's Century Date Change Initiative office reports that as of the beginning of August -- after an estimated $200 million in work -- repairs were complete on 99 percent of the systems needed to support 319 essential state services. From the state police to the Department of Motor Vehicles, Virginia has completed its repairs and testing and returned most of the now Y2K-ready systems to service, state officials said. Maryland's self-assessment suggests that it remains somewhat behind Virginia: Ninety-four percent of its critical software systems were rated as "compliant" as of the start of September, after an estimated $106 million investment by the state. The remaining work includes items such as a vendor-payment system, backup generators on emergency radio towers and building fire alarms. But overall, Maryland officials are extremely optimistic. "I will make you a $10,000 bet that the state of Maryland will not have a major outage of services that will cause a loss of life or major property damage," said Frank J. Stech, deputy director of the Maryland Year 2000 Program Management Office. "That is how confident I am." Local government officials are similarly sanguine. Fairfax reports that 98 percent of its central computer systems are fixed, tested and back in service. Prince George's County puts the figure at 99 percent; Montgomery, 98 percent. The District, which began its Y2K repair effort years after neighboring state and local governments, is convinced that residents and visitors -- including the thousands expected on the Mall for the millennium party -- will not be affected. To date, about 77 percent of the city's computer systems have been fixed, with a smaller portion also tested. The remaining repair and testing work -- in areas such as Medicaid and unemployment insurance -- is scheduled to be completed by the end of November. The District may have "a handful of short interruptions" in its computer systems, said Chief Technology Officer Suzanne J. Peck. But because it is on such a tight repair schedule, the District has also developed one of the nation's most extensive sets of contingency plans, meaning there will be a backup system ready to kick in. D.C. General Hospital, for example, will have as many as 175 extra staff members on site in case computer functions need to be handled manually. "No matter where this slender handful [of failures] occurs, we will be ready for it," Peck said. Man and Machine Despite all work -- from the private sector to federal, state and local governments -- officials offer no guarantees. Overseas, particularly in Russia, China, Eastern Europe, and developing nations in Africa, Asia and South America, severe disruptions are considered likely. In the United States, concern remains about some of the nation's local governments and small and medium-size businesses that may have failed to take the Y2K threat seriously. Such failures could gradually slow the supply of goods to large corporations, said Edward Yourdon, a software engineer, consultant and author of several Y2K books. As a result, he still predicts Y2K will have an effect on the U.S. economy over the coming year. The consumer-reaction question also remains, although many large retail businesses, anticipating a surge in demand at the end of the year, are planning to keep extra inventory in their warehouses. "Our biggest concern at this point isn't technical, it's human," said Lisa McCue, spokeswoman for the Grocery Manufacturers of America, a Washington-based trade group that represents food producers. "It's difficult to predict today what consumers will do -- just how much extra bottled water and milk and bread they will want -- at the end of December." Sen. Robert F. Bennett (R-Utah), chairman of the Senate's Y2K committee, said he was "optimistic about the huge national systems" but remained concerned that individual companies, local communities and "the stand-alone hospital that doesn't have the money or muscle to get its problems under control" could be at risk of Y2K disruptions. He also noted that much of the information available regarding Y2K preparedness is based on self-reported data. Still, Bennett said, "the Y2K problem is not going to be across the country but across the street." Businesses and governments generally are spending the remaining 100 days checking and rechecking their systems and backup plans. And they are walking a fine line -- urging consumers to behave rationally while also suggesting that they make modest preparations in the event of any problems. Thousands of executives and technology specialists will be at work across the nation on New Year's Eve, monitoring computer systems as they enter the new year. Even without severe Y2K glitches, trouble could sprout: A surge in telephone calls just after midnight to see if the phones work, for example, could translate into busy signals that are unrelated to the Y2K bug. To some extent, if the Y2K mobilization proves to be as successful as some predict, the final reaction may be a public questioning what all the hype was about. "We are already starting to hear, 'You spent millions of dollars and nothing happened, what were you doing,' " said Bette H. Dillehay, Virginia's Y2K chief. "Well, that is only because we spent the millions of dollars. It is no mistake." © 1999 The Washington Post Company