BUDGET OFFICE ORDERS END TO WEB SITE TRACKING

WASHINGTON -- The Clinton administration's budget office issued strict new
rules yesterday for how government agencies use software to track Internet
users and ordered all departments to immediately review their compliance
with existing privacy policies.

The directive from the Office of Management and Budget comes a day after
the White House ordered its Office of National Drug Control Policy to stop
tracking computer users viewing its anti-drug advertising on the Internet.
The ads, sold by a company contracted by the drug office, used "cookies,"
small software files often placed on computers without a person's knowledge
that can track movement on the Web and collect personal data.

In a memo to all government agencies, budget director Jack Lew explicitly
pointed out that the administration's privacy policies include all
contractors operating Web sites on behalf of the government.

"Under this new federal policy, 'cookies' should not be used at federal Web
sites, or by contractors when operating Web sites on behalf of agencies,"
Lew said, noting there would be strict requirements for using the software.

Federal agencies will have to demonstrate a "compelling need to gather the
data," publicly disclose how any collected personal information would be
protected and get the authorization of the agency head.