[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
TSA REFORM: EXPLORING INNOVATIONS IN TECHNOLOGY PROCUREMENT TO
STIMULATE JOB GROWTH
=======================================================================
HEARING
before the
SUBCOMMITTEE ON
TRANSPORTATION SECURITY
of the
COMMITTEE ON HOMELAND SECURITY
HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
__________
SEPTEMBER 22, 2011, OCTOBER 13, 2011 and NOVEMBER 3, 2011
__________
Serial No. 112-46
__________
Printed for the use of the Committee on Homeland Security
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.gpo.gov/fdsys/
__________
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COMMITTEE ON HOMELAND SECURITY
Peter T. King, New York, Chairman
Lamar Smith, Texas Bennie G. Thompson, Mississippi
Daniel E. Lungren, California Loretta Sanchez, California
Mike Rogers, Alabama Sheila Jackson Lee, Texas
Michael T. McCaul, Texas Henry Cuellar, Texas
Gus M. Bilirakis, Florida Yvette D. Clarke, New York
Paul C. Broun, Georgia Laura Richardson, California
Candice S. Miller, Michigan Danny K. Davis, Illinois
Tim Walberg, Michigan Brian Higgins, New York
Chip Cravaack, Minnesota Jackie Speier, California
Joe Walsh, Illinois Cedric L. Richmond, Louisiana
Patrick Meehan, Pennsylvania Hansen Clarke, Michigan
Ben Quayle, Arizona William R. Keating, Massachusetts
Scott Rigell, Virginia Kathleen C. Hochul, New York
Billy Long, Missouri Janice Hahn, California
Jeff Duncan, South Carolina
Tom Marino, Pennsylvania
Blake Farenthold, Texas
Mo Brooks, Alabama
Michael J. Russell, Staff Director/Chief Counsel
Kerry Ann Watkins, Senior Policy Director
Michael S. Twinchek, Chief Clerk
I. Lanier Avant, Minority Staff Director
------
SUBCOMMITTEE ON TRANSPORTATION SECURITY
Mike Rogers, Alabama, Chairman
Daniel E. Lungren, California Sheila Jackson Lee, Texas
Tim Walberg, Michigan Danny K. Davis, Illinois
Chip Cravaack, Minnesota Jackie Speier, California
Joe Walsh, Illinois, Vice Chair Cedric L. Richmond, Louisiana
Mo Brooks, Alabama Bennie G. Thompson, Mississippi
Peter T. King, New York (Ex (Ex Officio)
Officio)
Amanda Parikh, Staff Director
Natalie Nixon, Deputy Chief Clerk
Thomas McDaniels, Minority Subcommittee Director
C O N T E N T S
----------
Page
THURSDAY, SEPTEMBER 22, 2011
Statements
The Honorable Mike Rogers, a Representative in Congress From the
State of Alabama, and Chairman, Subcommittee on Transportation
Security:
Oral Statement................................................. 1
Prepared Statement............................................. 2
The Honorable Sheila Jackson Lee, a Representative in Congress
From the State of Texas, and Ranking Member, Subcommittee on
Transportation Security:
Prepared Statement............................................. 31
The Honorable Bennie G. Thompson, a Representative in Congress
From the State of Mississippi, and Ranking Member, Committee on
Homeland Security:
Oral Statement................................................. 3
Prepared Statement............................................. 4
Witnesses
Ms. Elaine C. Duke, President, Elaine Duke & Associates, LLC:
Oral Statement................................................. 5
Prepared Statement............................................. 7
Mr. Michael P. Jackson, President, Firebreak Partners, LLC:
Oral Statement................................................. 9
Prepared Statement............................................. 10
Mr. Stephen M. Lord, Director, Homeland Security, Government
Accountability Office:
Oral Statement................................................. 15
Prepared Statement............................................. 17
THURSDAY, OCTOBER 13, 2011
Statements
The Honorable Mike Rogers, a Representative in Congress From the
State of Alabama, and Chairman, Subcommittee on Transportation
Security....................................................... 41
The Honorable Sheila Jackson Lee, a Representative in Congress
From the State of Texas, and Ranking Member, Subcommittee on
Transportation Security........................................ 42
Witnesses
Mr. Marc A. Pearl, President and CEO, Homeland Security and
Defense Business Council:
Oral Statement................................................. 45
Prepared Statement............................................. 46
Mr. Scott Boylan, Vice President and General Counsel, Safran
Morpho Detection:
Oral Statement................................................. 51
Prepared Statement............................................. 53
Mr. Guy Ben-Ari, Deputy Director, Defense-Industrial Initiatives
Group Fellow, International Security Program, Center for
Strategic and International Studies:
Oral Statement................................................. 54
Prepared Statement............................................. 56
THURSDAY, NOVEMBER 3, 2011
Statement
The Honorable Mike Rogers, a Representative in Congress From the
State of Alabama, and Chairman, Subcommittee on Transportation
Security....................................................... 71
Witnesses
Mr. Nick Nayak, Chief Procurement Officer, U.S. Department of
Homeland Security:
Oral Statement................................................. 74
Prepared Statement............................................. 75
Mr. Robin E. Kane, Assistant Administrator, Security Technology,
Transportation Security Administration:
Oral Statement................................................. 78
Joint Prepared Statement....................................... 79
Mr. Paul Benda, Chief LOf Staff, Director, Homeland Security
Advanced Research Projects Agency, U.S. Department of Homeland
Security, Accompanied by Susan Hallowell, Director,
Transportation Security Laboratory:
Oral Statement................................................. 85
Joint Prepared Statement....................................... 79
Mr. Charles K. Edwards, Acting Inspector General, U.S. Department
of Homeland Security:
Oral Statement................................................. 87
Prepared Statement............................................. 88
Appendix
Questions Submitted by Chairman Mike Rogers for Nick Nayak....... 117
Question Submitted by Ranking Member Sheila Jackson Lee for Nick
Nayak.......................................................... 117
Questions Submitted by Chairman Mike Rogers for Robin E. Kane.... 118
Questions Submitted by Ranking Member Bennie G. Thompson for
Robin E. Kane.................................................. 120
Questions Submitted by Ranking Member Sheila Jackson Lee for
Robin E. Kane.................................................. 120
Questions Submitted by Chairman Mike Rogers for Paul Benda....... 121
Question Submitted by Ranking Member Bennie G. Thompson for Paul
Benda.......................................................... 121
Question Submitted by Ranking Member Sheila Jackson Lee for Paul
Benda.......................................................... 122
Question Submitted by Ranking Member Sheila Jackson Lee for
Charles K. Edwards............................................. 122
TSA REFORM: EXPLORING INNOVATIONS IN TECHNOLOGY PROCUREMENT TO
STIMULATE JOB GROWTH
----------
Thursday, September 22, 2011
U.S. House of Representatives,
Subcommittee on Transportation Security,
Committee on Homeland Security,
Washington, DC.
The subcommittee met, pursuant to call, at 10:01 a.m., in
Room 311, Cannon House Office Building, Hon. Mike Rogers
[Chairman of the subcommittee] presiding.
Present: Representatives Rogers, Jackson Lee, Davis,
Richmond, and Thompson (ex officio).
Mr. Rogers. The Committee on Homeland Security Subcommittee
on Transportation Security will come to order. The subcommittee
is meeting today to examine innovative solutions to technology
procurement at TSA that could generate cost savings for the
Federal Government and stimulate job growth in the private
sector.
I will recognize myself now for an opening statement. I do
want to make a point that the Ranking Member, Ms. Jackson Lee,
called me a little while ago. She is currently giving a speech
downtown and is going to be a few minutes late. So we will get
started and she will be here as soon as she can.
I would like to welcome everybody to our hearing today and
thank the witnesses for the time they have put into these
prepared remarks and making themselves available for this
hearing. I look forward to your comments.
As part of our oversight of the Transportation Security
Administration, one of the things we are looking to do is to
encourage good ideas that will stimulate job growth in the
private sector. Given the hundreds of millions of dollars that
the agency spends on technology procurement per year, I believe
the TSA has ample opportunity to generate any number of
private-sector jobs. The House-passed fiscal year 2012
appropriations bill would provide TSA with more than $550
million for explosive detection system procurement and
maintenance. I would like to see if we can find creative ways
to reduce that cost over time while still keeping the traveling
public safe from acts of terrorism.
There are lots of good ideas out there, some of which TSA
is engaged in already, and other proposals that we are hearing
about from the private sector. I believe there are a variety of
ways that we can better tap into and leverage the private
sector to provide technologies and services. There is a great
innovation in the private sector, both among large and small
businesses, and we need to do everything we can to foster that
innovation. This includes streamlining and reforming
acquisitions mechanisms within TSA and it also means finding
new opportunities to entice industry, especially through
greater transparency on the part of TSA, as to what its
acquisition roadmap looks like.
The only way to reap the benefits of many businesses out
there that have the solutions we need is, to the extent
possible, let them know what TSA wants and when it wants it.
The TSA Authorization Act of 2011, just adopted by this
subcommittee, is aimed at improving security by streamlining
and eliminating burdensome regulations that are a barrier to
job creation in the transportation industry and encouraging the
use of technologies developed by the private sector.
This subcommittee hearing will continue to focus on the
wise use of taxpayer dollars and job creation by examining
TSA's technology procurement practices. I would like to see TSA
fully engage the private sector in an open, transparent way for
the development and purchase of security technologies. I would
like to see progress on saving taxpayers' dollars and creating
private sector jobs. I believe we can achieve this while
effectively securing the traveling public and the flow of
commerce. I look forward to hearing the witnesses' ideas for
finding cost efficiencies and stimulating jobs through improved
technology procurement at TSA.
[The statement of Chairman Rogers follows:]
Prepared Statement of Chairman Mike Rogers
September 22, 2011
I would like to welcome everyone to this important hearing and
thank our witnesses for being here. We look forward to your testimony
and greatly appreciate your time.
As part of our oversight of the Transportation Security
Administration, one of the things we are looking to do is encourage
good ideas that will stimulate job growth in the private sector. Given
the hundreds of millions of dollars that the agency spends on
technology procurement per year, I believe that TSA presents ample
opportunity for generating any number of private-sector jobs.
The House-passed fiscal year 2012 appropriations bill would provide
TSA with more than $550 million for explosives detection system
procurement and maintenance. I'd like to see if we can find creative
ways to reduce that cost over time, while still keeping the traveling
public secure from acts of terrorism.
There are lots of good ideas out there, some of which TSA is
engaged in already, and other proposals that we are hearing about from
the private sector.
I believe there are a variety of ways that we can better tap into
and leverage the private sector to provide technologies and services.
There is great innovation in the private sector, both among large and
small businesses, and we need to do everything we can to foster that
innovation.
This includes streamlining and reforming acquisitions mechanisms
within TSA. It also means finding new opportunities to entice industry,
especially through greater transparency on the part of TSA as to what
its acquisition roadmap looks like. The only way to reap the benefits
of the many businesses out there that have the solutions we need is--to
the extent possible--let them know what TSA wants and when it is going
to want it.
The TSA Authorization Act of 2011, just adopted by this
subcommittee, is aimed at improving security by streamlining and
eliminating burdensome regulations that are a barrier to job creation
in the transportation industry, and encouraging the use of technologies
developed by the private sector.
This subcommittee hearing will continue to focus on the wise use of
taxpayer dollars and job creation by examining TSA's technology
procurement practices. I would like to see TSA fully engage the private
sector in an open and transparent way for the development and purchase
of security technologies. I'd like to see progress on saving taxpayer
dollars and creating private-sector jobs. I believe we can achieve this
all while effectively securing the traveling public and the flow of
commerce.
I look forward to hearing the witness' ideas for finding cost
efficiencies and stimulating the growth of jobs through improved
technology procurement at TSA. With that I yield to the Ranking Member,
Ms. Jackson Lee of Texas, for any opening statement she may have.
Mr. Rogers. With that, I yield to the Ranking Member of the
full committee, Mr. Thompson from Mississippi.
Mr. Thompson. Thank you very much, Mr. Chairman. I welcome
our panel of witnesses to the subcommittee hearing today.
Under the Democratic majority, as you know, we held several
hearings on the role of the Science and Technology Directorate,
TSA's technology vetting and approval process, and the need for
DHS to align research with its mission. I am pleased that the
oversight begun under our watch continues today. As we conduct
oversight and continue steps toward reform, let us assure that
S&T has sufficient funding. As you know, S&T is in line to make
a major cut to its budget in the fiscal year. Programs would
need to be scaled back and promising projects may be
eliminated. Mr. Chairman, I hope you can work with us to stop
these drastic cuts.
Today's hearing will evaluate the Department's process to
develop, procure, and deploy innovative technologies. It would
have been helpful if we had had someone who currently works for
the Department testify today. But I do look forward to hearing
from Mr. Jackson and Ms. Duke, former Department employees.
While they are unlikely to shed light on the current process, I
hope they can shed light on the process used during their
tenure.
Some experts have said the failure to employ an effective
process led to the puffer machine fiasco. For those who may not
recall, I want to take a moment to recount the puffer machine
story. The Department purchased these high-tech checkpoint
screening machines for about $150,000 each. We were told that
the machines would spray a short puff of air on a passenger.
The machine would then analyze the debris that fell from the
passenger and determine whether the passenger had been near
explosive material.
In the lab, the machine seemed to work. The maker promised
that they would work. So TSA ordered 200 of them. However, in
the real world, the machines were useless. They did not work.
There was no way to make them work. After spending nearly $30
million to buy and maintain the nearly 100 puffer machines
deployed, TSA finally retired these machines. At one time,
these machines were touted as a high-tech response to aviation
security. Now, they are sitting in a warehouse and we have
wasted $30 million.
Why did this happen? It happened because the research,
development, and testing of the technology was disconnected
from the real-world use of the machines.
We cannot allow another incident of this kind to occur.
Every dollar we waste on ineffective technology is a dollar
that will not be spent to secure this Nation. The puffer
machine fiasco happened while Mr. Jackson and Ms. Duke were at
the Department. I look forward to hearing from them about how
the system that was in place then allowed for the procurement
of these machines.
In the last few months, the Obama administration has
attempted to reform research, development, and procurement
practices at S&T. I hope that Mr. Jackson and Ms. Duke will
share with this committee the difficulties they found in their
attempts at reform.
I look forward to hearing from our witnesses.
I yield back.
[The statement of Ranking Member Thompson follows:]
Prepared Statement of Ranking Member Bennie G. Thompson
September 22, 2011
Under the Democratic Majority, we held several hearings on:
the role of the Science and Technology Directorate;
TSA's technology vetting and approval process;
the need for DHS to align research with its mission; and
examining whether research fulfilled mission-critical needs
of the components.
I am pleased that the oversight begun under our watch continues
today. As we conduct oversight and consider steps toward reform, let us
also assure that S&T has sufficient funding to do its job.
As you know, S&T is in line to take a major cut to its budget in
the upcoming fiscal year. Programs will need to be scaled back and
promising projects may be eliminated. Mr. Chairman, I hope you can work
with us to stop these drastic cuts.
Today's hearing will evaluate the Department's process to develop,
procure, and deploy innovative technologies. It would have been helpful
to have someone who currently works for the Department testify today.
But I do look forward to hearing from Mr. Jackson and Ms. Duke,
former Department employees. While they are unlikely to shed light on
the current process, I hope they can shed light on the process used
during their tenure.
Some experts have said that the failure to employ an effective
process led to the ``Puffer'' machine fiasco.
For those who may not recall, I want to take a moment to recount
the Puffer machine story. The Department purchased these high-tech
checkpoint screening machines for about $150,000 each.
We were told that the machine would spray a short puff of air on a
passenger. The machine would then analyze the debris that fell from the
passenger and determine whether the passenger had been near explosive
materials. In the lab, the machines seemed to work. The maker promised
that they would work. So TSA ordered over 200 of them.
However, in the real world, the machines were useless. They did not
work and there was no way to make them work. After spending nearly $30
million to buy and maintain the nearly 100 Puffers deployed TSA finally
retired the machines. At one time, these machines were touted as a
high-tech response to aviation security. Now they are sitting in a
warehouse and we have wasted $30 million.
Why did this happen? It happened because the research, development,
and testing of the technology was disconnected from the real-world use
of the machine.
We cannot allow another incident of this kind to occur. Every
dollar we waste on ineffective technology is a dollar that will not be
spent to secure this Nation. The Puffer machine fiasco happened while
Mr. Jackson and Ms. Duke were at the Department.
I look forward to hearing from them about how the system that was
in place then allowed the procurement of these machines. In the last
few months, the Obama administration has attempted to reform the
research, development, and procurement practices at S&T. I hope that
Mr. Jackson and Ms. Duke will share with this committee the
difficulties they found in their attempts at reform.
Mr. Rogers. I thank the Ranking Member.
We are very pleased today to have a distinguished panel of
witnesses before us on this important topic. Elaine Duke is the
principal of Elaine Duke and Associates, LLC. She provides
acquisition and business consulting services to a wide variety
of clients. She specializes in assisting companies in doing
business with the Federal Government. Ms. Duke had 28 years
with the Federal Government--she started at age 3--culminating
with her Senate confirmation on June 27, 2008, as the
Department of Homeland Security's Under Secretary for
Management. As the Under Secretary, she was responsible for the
management of the Department's $47 billion budget. We don't use
millions up here, apparently.
She previously served in several positions within the
Department, including Deputy Under Secretary for Management and
Chief Procurement Officer. Ms. Duke assisted in the stand-up of
DHS while at the Transportation Security Administration, where
she served as Deputy Assistant Administrator for Acquisition
beginning in August 2002. Ms. Duke spent a great deal of her
career with the U.S. Navy, and she has held various acquisition
positions of progressive responsibility.
During her service with the Federal Government, Ms. Duke
received the Presidential Meritorious Rank award, the DHS
Secretary's Medal, and the Transportation Security
Administration's Silver Medal for Customer Service, the
Department of Army Commanders Award for Public Service, and the
U.S. Coast Guard's Distinguished Public Service.
Ms. Duke, we are very proud to have you here today. You are
recognized for your opening statement.
STATEMENT OF ELAINE C. DUKE, PRESIDENT, ELAINE DUKE &
ASSOCIATES, LLC
Ms. Duke. Good morning, Chairman Rogers and Members of the
subcommittee. I am pleased to testify before the committee as
it explores innovations in technology procurement to stimulate
job growth.
Mr. Chairman, I would like to begin by thanking you for
your leadership over the years as a key member of the Homeland
Security Committee. Since I was first standing up acquisition
at TSA, through my time as the Department of Homeland Security
as Chief Procurement Officer, and then Under Secretary for
Management, you and this committee have provided me tremendous
support. I am truly grateful.
In this time of high unemployment, coupled with the debt
ceiling crisis, each one of us must ask what can be done
differently to contribute to economic recovery? The questions
``What changes to the procurement process might stimulate job
growth?'' and ``How can TSA improve efficiency and therefore
save taxpayer dollars?'' are important questions, and I thank
you for letting me participate in this hearing.
I believe Federal procurement can play a role in
stimulating job growth in the United States. There are several
measures that can be taken to ensure DHS, TSA technology, and
other acquisition programs maximize job growth as they meet
mission needs in partnership with industry. The key to making
this happen is to get the funds that are appropriated to TSA
for acquisition programs out into awarded contracts to our
industry partners quickly effectively and efficiency. There are
several steps that can be taken to do this.
First, there must be the appropriate number of acquisition
workforce personnel with the appropriate skill set to manage
the acquisition programs. Now, more than ever, with flat and
declining budgets, TSA must ensure that the acquisition
workforce is properly positioned to manage its programs. That
will ensure a couple of key features: First, that the
requirement will be adequately defined so industry can prepare
proposals and perform effectively. Good requirements lead to
good competition.
Second, the request for proposals and resulting contracts
can be issued quickly and awarded without protest so the work
can begin promptly and the industry partner can create and
sustain jobs.
Third, is the Government's requirement will be met at the
best price, with the appropriated funds not going to
unnecessary overhead but to direct work in the related jobs.
The acquisition program will deliver what the homeland security
mission really needs.
There are several key initiatives that will help ensure the
desired result. One is continuation of the DHS's acquisition
workforce and its Acquisition Professional Career Program that
provides a pipeline of acquisition professionals into the
Federal workforce. Another is continued refinement of the
functional integration authority over the departmental chiefs
of the business lines. A third is the balancing of the Federal
and acquisition workforce within DHS. There must be an
appropriate balance of the Federal workforce and its industry
partners. I don't believe there is a magic formula of
percentage and number. The amount of the workforce and control
is dependent on the size and criticality of the program.
An agency, regardless of its contractual relationship, must
retain ownership and responsibility for being a good steward of
the taxpayer dollars appropriated to that agency.
Another important aspect of using procurement to stimulate
job growth is to ensure there is strong regular communications
with industry. The Federal Acquisition Regulation provides
guidelines for market research that allow extensive
communications with industry throughout the acquisition
process.
Taking maximum advantage of the communications not only
makes for a better acquisition program, it helps industry by
informing its business decisions. Bid and proposal decisions
are critical in industry, and the cost to submit proposals for
Federal procurements can be very high. Communications mutually
inform so both parties--the U.S. Government and industry--can
make the best, most precise, most efficient business decisions.
Third, acquisition strategies, budgets, and requirements
can work together. The current 25-Point Implementation Plan to
Reform Federal Information Technology Management, for instance,
points out that for the technology initiatives, such as cloud
computing and shared services to work, there must be strong
acquisition management, and more importantly, there must be an
alignment between the programs, the acquisition process, and
the budget cycle.
Also, DHS, with TSA, must buy effectively and efficiently.
That includes a robust strategic sourcing program and working
towards the joint capabilities that are outlined in DHS's
integrated strategy for high-risk management. Improved
procurement can benefit and help the United States move towards
its economic recovery.
I look forward to discussing this further through your
questions. Thank you.
[The prepared statement of Ms. Duke follows:]
Prepared Statement of Elaine C. Duke
September 22, 2011
Chairman Rogers, Ranking Member Jackson Lee, and Members of the
subcommittee, I am pleased to testify before the committee as it
explores ``Innovations in Technology Procurement to Stimulate Job
Growth.'' Mr. Chairman, I'd like to begin by thanking you for your
leadership over the years as a key member of the Homeland Committee.
Since I was first standing up the acquisition function at TSA, through
my time as Department of Homeland Security's Chief Procurement Officer
and then Under Secretary for Management, you provided me tremendous
support, and I am truly grateful.
In this time of high unemployment coupled with the debt ceiling
crisis, each one of us must ask what can be done differently to
contribute to economic recovery. The questions ``What changes to the
procurement process might stimulate job growth?'' and ``How can TSA
improve procurement efficiency, and therefore save taxpayer dollars?''
are important questions and I again thank the committee for calling
this hearing to explore answers to these critical questions.
I believe Federal procurement can play a role in stimulating job
growth in the United States. There are several measures that can be
taken to ensure that DHS, TSA technology, and other acquisition
programs maximize job growth as they meet mission needs in partnership
with industry. The key is to get the funds that are appropriated to TSA
for acquisition out into awarded contracts with industry partners
quickly, effectively, and efficiently. There are several steps that can
be taken to do this.
First, there must be the appropriate number of acquisition
workforce personnel, with the appropriate skill set, to manage the
acquisition programs. Now more than ever, facing flat and declining
budgets, TSA must ensure that its acquisition workforce is properly
positioned to manage its program. That will ensure several key
features:
The requirement will be adequately defined so industry can
prepare proposals and perform most effectively. Good
requirements lead to good competition.
The request for proposals and resulting contracts can be
issued and awarded quickly and without protest, so work can
begin promptly and the industry partner can create and sustain
jobs.
The Government's requirement will be met at the best price,
with the appropriated funds not going to unnecessary overhead,
but to direct work and the related jobs.
The acquisition program will deliver what the homeland
security mission needs.
There are several initiatives that will help ensure the desired
results are achieved.
The DHS acquisition Workforce and its Acquisition
Professional Career Program is providing a pipeline of new
acquisition professionals into the Federal workforce. It is
designed to provide both formal and on-the-job training and
results in a well-qualified Federal acquisition workforce.
The functional integration authority of the Departmental
chiefs over the component functions must continue to be
refined.
A balancing of the Federal and contracting workforce within
DHS. There must be an appropriate balance of Federal workforce
and industry partners. There is no magic formula of percentage
and number. The amount of Federal workforce and control is
dependent on the size and criticality of a program. An agency,
regardless of its contractual relationship, must retain the
ownership and responsibility for being a good of steward of
taxpayer dollars appropriated to that agency. Partnering with
industry to perform the work is a key aspect of good
stewardship, but accountability, at its core remains with the
Federal agency. Critical functions should be performed with
Federal employees to the extent required by the agency to
maintain control of its mission. Once there are adequate
Federal employees to control the critical functions (mission
and operations), the work can be performed by private sector
contractors, creating the properly balanced workforce and
private industry job stimulation.
Second, is there must be strong, regular communications with
industry. The Federal Acquisition Regulation provides guidelines for
market research that allow extensive communications with industry.
Taking maximum advantage of the communications not only makes for a
better acquisition program, it also helps industry but informing its
business decisions. Bid and proposal decisions are critical for
industry, and costs to submit proposals for Federal procurements can be
very high. Communications mutually inform so both parties--the U.S.
Government and industry--so they can make the best, most precise, most
efficient business decisions.
Third, acquisition strategies, budgets, and requirements must work
together. The 25-Point Implementation Plan to Reform Federal
Information Technology Management points out that for the technology
initiatives, such as cloud computing, shared services, data centers to
be effective, there must be strong acquisition management, the
acquisition process must be aligned with the technology cycle, and the
budget process must be aligned with the technology cycle. Industry will
only partner with the Federal Government, and create jobs, if the
business risk is appropriate. The Federal procurement system must, with
industry engagement, develop acquisition strategies that deliver the
technology solution with appropriately manageable financial,
performance, and schedule risk.
Fourth, DHS, with TSA, must buy efficiently and effectively, thus
enabling industry to operate efficiently and effectively. There are two
facets to this point. The first is based around finding commonality in
requirements within DHS missions and programs, and defining
requirements and filling those requirements in a joint manner. DHS's
Integrated Strategy for High Risk Management Implementation and
Transformation, discusses the formation of Functional Coordination
Offices and a Capabilities & Requirements Council among the key
initiatives to increase DHS management integration. This will require a
rationalization of requirements that will greatly contribute to
effectiveness and efficiency in procurement. The second facet is that
agencies must continue to use and grow strategic sourcing programs to
procure goods and services more effectively. Strategic sourcing
leverages the buying power of TSA, DHS, and the Federal Government.
Improved procurement not only provides economic benefit to our
country in terms of effective use of tax dollars and job creation, it
also helps ensure screening technologies actually make the traveling
public safer. TSA must buy the right things at the right time for the
right price to meet the homeland security threat, currently and as it
evolves. The initial stand-up of TSA was focused on Federalizing the
airports. As it matures, TSA must find the right mix of technology,
people, and systems. A risk-based approach, facilitating freedom of
movement of goods and people while providing adequate security for
evolving threats against homeland security is a critical facet of the
path forward. The approach must provide security for the present, while
always anticipating and prepared to evolve to adapt to changes in
threat and security technology.
Thank you for the opportunity to participate in your discussions
regarding the ability of sound procurement to contribute to job growth
and economic stability. I look forward to your questions.
Mr. Rogers. Thank you. Next, we have Michael Jackson,
President and founder of Firebreak Partners, LLC, a firm that
designs, finances, and deploys high-value security technology
networks to protect airports, seaports, and other critical
infrastructure. Mr. Jackson has extensive experience in
executive positions in both the private sector and Federal
Government. From early 2005 through October, 2007, he was
Deputy Secretary of the U.S. Department of Homeland Security.
In this role, he was the Department's chief operating officer,
with responsibility for managing day-to-day operations in DHS.
Mr. Jackson served as Deputy Secretary to the U.S. Department
of Transportation from May, 2001 to August, 2003.
His tenure there was particularly focused on DOT's response
to 9/11 terrorist attacks, including creation of the new
Transportation Security Administration and the management of
the recovery efforts for the Nation's aviation industry. Mr.
Jackson also held positions working for Presidents George H.W.
Bush and Ronald Reagan. In addition, Mr. Jackson has worked at
a number of private technology corporations. He has been a
researcher at the American Enterprise Institute, and taught
political science at the University of Georgia and Georgetown
University.
Mr. Jackson, thank you for being here. We look forward to
your testimony. You are recognized.
STATEMENT OF MICHAEL P. JACKSON, PRESIDENT, FIREBREAK PARTNERS,
LLC
Mr. Jackson. Good morning, Mr. Chairman. Thank you very
much for having me here today. Ranking Member Thompson, thank
you for being with us this morning. I appreciate your presence
as well and the opportunity to talk about TSA and the topic of
this hearing.
Technology, obviously, is a vital component of TSA's
success and its mission. Congress has generously funded
billions of dollars in technology for this agency over the
decade following the attacks of 9/11. Over that period, TSA has
made substantial progress. Yet today, simple procurement tools
and technologies could deliver meaningful budget savings and
improved security. Moreover, with Congressional approval and
with no additional cost to the taxpayers, TSA could also easily
increase the number of jobs in America, and do so relatively
quickly, particularly with simple affirmation of alternative
financing. My written testimony provides additional material
about all of these ideas. But I have essentially focused on
four points. I would like to today summarize those four points
by way of introduction.
First, the first recommendation I would have is to
authorize alternative financing and operating lease agreements
as proposed to TSA by public commercial airport authorities.
These transactions would leverage private sector capital to
acquire and maintain security technology for inline baggage
systems, checked baggage inspection, passenger checkpoint
screening, and other associated technology needs.
TSA faces just a formidable array of needs for the
technology to do its work to get operating efficiencies and to
do their screening tasks more effectively.
I would argue or suggest that Congress should consider
authorizing TSA--even better, instructing TSA--at least to
experiment and adopt alternative financing transactions. There
are multiple ways to structure these types of transactions that
would bring capital that could attract literally billions of
dollars into this important need for airports and TSA. My
testimony explains in more detail, for example, a proposal from
two airports that would have leveraged approximately $198
million in private sector investment to support TSA. TSA
rejected the proposal a few months ago because its staff
thought it lacked statutory authority to exercise an
appropriate operating lease arrangement with these airport
authorities.
The second recommendation is to privatize DHS's
transportation security lab certification testing for explosive
detection equipment, as has been pioneered by the European
Union. The process that DHS uses for certification testing for
explosive detection needs rethinking, it needs your focus, it
needs your attention and examination. The current process is
unnecessarily expensive, both for taxpayers and for vendors who
use the system. It is excessively time-consuming and the
process for obtaining approvals lacks clarity, transparency,
the resources, and adequate institutional capacity for making
this happen more quickly. The E.U. governments have
successfully privatized this function. My written testimony
explains why that should be considered here in the United
States.
The third recommendation I would like to lay on the table
is for TSA to create a TSA version of an ``X-Prize'' by
replacing at least some of TSA's traditional R&D equipment
funding with results-based achievement testing awards. Such
awards can stimulate breakthrough innovations in checkpoint and
checked baggage screening, and better leverage private
investment.
Pure and simple, we should at least look at some technology
incentive investments that reward getting the job done rather
than making promises for a job to be done.
The final recommendation is insist that any new core
explosive detection imaging system--CT, AT, AIT, trace
detection, these types of tools--that are sold to TSA, after
some reasonable date to be determined must have presented image
data outputs in an open source format. In addition, requiring
manufacturers to provide sufficient software transparency to
allow TSA the option to develop modular common-use apps
routinely that could help upgrade the software. This is a big
problem. The GAO has done a good report recently on this topic.
This type of thing is not hard to do. I thought when I was
at DHS that it was a good idea. I gave a speech for it. It
immediately met with a resounding reaction from the vendor
community. They just hated it. It is understandable. But I
would just urge you to dig into this topic because it is really
something that has transformed the medical community and can
transform TSA operations.
In conclusion, these four authorizations seem, in a way,
disarmingly simple or small-bore things perhaps, but together
they offer specific systemic procurement reform as regards to
TSA technology acquisition and promise transformational change
for the agency.
I thank you and look forward to your questions.
Mr. Rogers. I thank you.
[The prepared statement of Mr. Jackson follows:]
Prepared Statement of Michael P. Jackson
September 22, 2011
Good morning Chairman Rogers, Ranking Member Jackson Lee, and
distinguished Members of the subcommittee. I appreciate the opportunity
to appear before you today and to share some thoughts about the
Transportation Security Administration (TSA) and the important topic of
this hearing.
Technology is a vital component of TSA's mission and essential to
its success. Congress has generously funded billions of dollars in
technology for this agency over the decade following the attacks of 9/
11. The topic of this hearing suggests two introductory, orienting
questions:
Can further innovations at TSA regarding technology
acquisition allow the agency to reduce cost while improving
security?
Can TSA's technology investments be structured to maximize
job creation in these difficult economic times?
The answer to both is clearly yes. Tools to deliver budget
reductions and better security are readily available. Moreover, with
Congressional approval--and with no additional cost to taxpayers--TSA
could also easily increase the number of jobs in America, and do so
relatively quickly.
As a private citizen, I offer four recommendations for
Congressional action that can significantly advance the objectives
being explored by today's hearing:
1. Authorize ``alternative financing'' operating lease agreements
as proposed to TSA by public commercial airport authorities.
These transactions would leverage private sector capital to
acquire and maintain security technology for in-line baggage
systems, checked baggage inspection, passenger checkpoint
screening and potentially other needs.
2. Privatize the DHS's Transportation Security Lab certification
testing for explosive detection equipment, as has been
pioneered in the European Union.
3. Create TSA's version of an ``X-Prize'' by replacing at least
some of TSA's traditional R&D equipment funding with results-
based achievement awards. Such awards can stimulate
breakthrough innovations in checkpoint and checked bag
screening, and better leverage private investment.
4. Insist that any new core explosive detection imaging systems
(CT, AT, AIT, and the like) sold to TSA after a reasonable date
certain generate image data outputs in an open-source format.
Additionally, require manufacturers to provide sufficient
software transparency to allow TSA the option to develop
modular, common-use aps for routinely upgrading explosive
detection algorithms for its entire network of detection
systems.
What follows offers a few words about each of these
recommendations. My purpose is not to explore any single one in great
depth, instead to provide a high-level summary that can guide further
assessment by the subcommittee, if of interest.
Alternative Financing Agreements.--TSA faces a formidable array of
financial demands to fuel its critical technology needs. The single
most expensive category of investment has been in-line checked baggage
inspection systems. These investments clearly improve security and
airport operations, diminishing delays, and passenger inconvenience.
With each efficient in-line baggage system, TSA also typically
generates meaningful cost savings for its own operation--for its
capital budgets, because TSA purchases fewer explosive detection
systems (e.g., EDS and trace detection) and for operational budgets
because TSA achieves greater personnel efficiency, increased screening
throughput, lower maintenance, fewer consumables and reduced energy
consumption. These TSA savings often total millions of dollars
annually, even at a mid-sized airport.
Although TSA has a large backlog of in-line checked baggage system
projects that have been funded but not completed, there remains a large
backlog of unfunded in-line system needs that will require more
billions of dollars and many years to eliminate.\1\ TSA has been
chasing this backlog since 2002. In fact, some of the expensive
projects initially funded by TSA must now regrettably be upgraded to
accommodate today's requirements for higher-speed screening technology.
---------------------------------------------------------------------------
\1\ Congress and the administration have allocated a great deal of
cash to this problem, especially during the last 2 years. Yet the
number of priority airports (TSA's Category X-III targets) that are
still not fully funded remains large. TSA's fiscal year 2012
Congressional Budget Justification reports that only 187 of the 286
largest airports (CAT X-III) will have CBIS systems completed for the
entire airport at the end of fiscal year 2011 (p. A-23). The fiscal
year 2011 Budget Justification predicted that TSA would not reach 100
percent coverage even for the largest airports until 2018 (p. AS-30).
Some airports lack capacity to fund projects effectively under TSA's
current business model. Those airports are, in many cases, not yet even
in the early stages of TSA's project funding queue. Moreover, several
of the more expensive projects completed early after 9/11 have failed
by a notable margin to meet the minimum throughput standards that TSA
set for such systems (400 bags per hour) and would need almost
wholesale replacement to support even the currently certified medium-
capacity EDS machines, let alone the higher-capacity EDS machines that
could improve performance and further reduce TSA capital and operating
expenses at those airports.
---------------------------------------------------------------------------
Aside from in-line baggage system investments, TSA is also juggling
numerous other formidable capital needs for technology. These include
checkpoint equipment modernization, exit lane breach control (for which
effective technology is available to allow reassignment of guards who
now stand watch at exit lanes), risk-based screening infrastructure,
credential validation systems, efficient physical security device
management (for cameras, video recorders, door locks, etc.),
multiplexing of threat detection imaging for more efficient and
effective review remotely (TSA has recently published a Request for
Information seeking technologies that can make this happen), and more.
For the next several years, TSA's capital budgets will face a
particular squeeze in order to recapitalize its first-generation EDS
machines and related technologies, which are now reaching the end of
anticipated service life. It is simply not practical to fund all of
TSA's needs with a business model that continues to ask Congress to
write such large checks. Yet absent investment, better security,
greater efficiency, TSA cost reductions and customer service
improvements will be deferred.
Alternative financing can and should play a role in meeting TSA
mission needs. There are multiple business models that work, and there
will be many airports willing to engage with TSA creatively, if
allowed. These solutions don't require complex tax code changes or
exotic and risky financing structures. They would simply leverage the
way airports for decades have done business.
But to jump-start this common-sense investment, Congress must
authorize TSA--even better, instruct TSA--at least to experiment in
adopting alternative financing transactions. By legislatively cutting
through one or two project scoring nits that are perceived by TSA staff
to be impediments, Congress can make it possible for TSA to negotiate
operating leases for security technology, just as TSA does today with
regard to leasing office space and obtaining other essential services
from airports Nation-wide. TSA authorizing legislation would simply
recognize affirm the unique dependencies that exist between TSA and
airport authorities, allowing government-to-government alternative
financing transactions to be funded, especially at today's
unprecedented favorable rates.
Sensible alternative financing can literally attract billions of
dollars of investment from the private sector. Not 2 or 3 years from
now. Now. This approach can facilitate many airport in-line baggage
system improvement projects, which can easily be completed at lower
cost and in less than half the time required to complete an identical
project funded with TSA's existing procurement model. Putting Americans
to work and supporting TSA's mission. I'll give a quick overview of one
approach with which I have been personally involved.
In September of last year two airport authorities--supported by
Delta Air Lines, Southwest Airlines, the Vic Thompson Company (arguably
the leading U.S. engineering firm specializing in aviation security
project work) and my firm--formally proposed two alternative financing
lease agreements to TSA. We had others ready to follow. These first two
transactions together offered an estimated $198 million in private-
sector investment to design, purchase, and maintain in-line baggage
systems, explosive detection equipment, and checkpoint modernization
technology.
As proposed, at each airport, the airport authority would make the
screening technology and infrastructure needed by TSA available to the
agency through a multi-year services agreement (the proposed term was 8
years). Screening systems currently operated by TSA (or regulated in
any way by TSA) would, of course, meet all TSA performance standards,
relevant equipment certifications and operational requirements.
The two transactions were part of a proposed new pilot program of
security investments, which the offerors called the Next Stage
Investment (NSI) program.
NSI does not contemplate any change regarding existing operational
roles and obligations at the airport. TSA would, for example, still be
responsible for operating or overseeing private sector operations
regarding checked bag and checkpoint screening. By pilot testing an
alternative to TSA's existing buy-own-maintain business model, TSA can
gain remarkable advantages, while preserving all of its inherently
Governmental discretion and operational control.
The NSI program is not an ordinary commercial enterprise; rather,
it is a government-to-government agreement that leverages private
sector skills in support of a compelling public interest. NSI can
substantially improve aviation security--and do so much more quickly,
at a lower project cost and more comprehensively than can be achieved
using TSA's existing business model for infrastructure investment. The
offerors are convinced that their alternative financing pilot program
provides a compelling value proposition for TSA and the aviation
industry.
NSI would generate well-paying jobs and other near-term economic
activity with its technology purchases, project design, construction
and private sector program management. Monthly fees to be paid by TSA
under the services agreement would not begin until after system
acceptance. In other words, NSI transactions would truly be quick-start
projects. Because TSA does not have to obligate funds up front to get
an NSI project off the ground, they offer a very efficient way to
reduce the backlog of TSA project needs without imposing on Congress
for large capital budget appropriations. A way to pilot test technology
innovations of all sorts.
The offerors can prove that the proposed NSI projects are sound
financial investments for TSA--reducing overall project costs,
decreasing the number of TSA employees needed for on-going screening
operations and reducing overhead costs at TSA headquarters. NSI
projects can considerably reduce TSA's dauntingly large backlog of
near-term technology investment needs. They can smooth investment
spikes and increase flexibility to pay for what will otherwise be large
capital budget needs for years ahead. Many of the savings achieved drop
straight to TSA's bottom line, generating annual saving each year
ahead.
Such alternative financing tools can help DHS and Congress balance
the need to reduce Federal budget outlays while meeting DHS mission
needs. The NSI and other alternative financing approaches proposals
therefore raise transactional policy issues that are strategically
significant for the long-term success of TSA and to DHS overall. In
sum, the NSI program constitutes a potentially transformational
business model for acquisition and maintenance of aviation security
technology.
So what happened with the two proposals? TSA staffers reviewed them
and decided that the transactions would have to be scored as a capital
lease rather than an operating lease, thus making the transaction
unworkable. This was based on a conservative interpretation of OMB
Circular A-11 (Appendix B), one that I would invite Members to review.
However, a simple legislative waiver allowing TSA to accept proposals
for such transactions would, I'm convinced, unlock very considerable
benefits for TSA.
2. Privatize the DHS's equipment certification testing.--The
process within DHS for providing certification testing for explosive
detection systems needs re-thinking. Today, the Transportation Security
Laboratory (TSL), a part of the DHS Science and Technology Directorate,
conducts such certification testing for TSA. A legacy FAA organization,
TSL is home to many highly talented individuals, men and women who do
work that is essential to DHS's mission. Certification testing is not a
task that needs to remain on their plate.
The current process is unnecessarily expensive, both for the
taxpayers and for vendors seeking certification of devices. It is
excessively time-consuming and the process for obtaining approvals
lacks clarity, transparency, resources, and an adequate institutional
capacity for working more quickly.
The gauntlet through which equipment manufacturers must navigate is
dispersed to several different testing locations. Vendors must often
guess at the requirements for success. If a firm is trying, for
example, to get a new EDS machine certified it starts with something
called certification readiness testing. Later, it ships a prototype
machine to TSL's Atlantic City, New Jersey facility. There it undergoes
testing with military and commercial explosives. Much of the actual
work supporting certification is done by TSL-contracted labor. In
addition, the firm has to send another prototype to Tyndall Air Force
Base in Florida for testing with more exotic and unstable threat
materials. Tyndall then sends their data and images up to New Jersey
for review. If successful, the applicant has to send a prototype
machine for integration testing to a facility outside of Washington,
DC, and later elsewhere for operational testing in an actual airport
environment.
If you fail at any stage (certification testing is appropriately
binary; miss something on the extensive test-list and you fail), you
pull out, try to fix the problems and ask for a spot in the busy queue
to start over. In short, the process is unnecessarily bureaucratic--and
a substantial impediment to innovation. I have spoken over the last 3
years with numerous successful venture capital investors who fund
various security start-ups or early stage businesses. Most of them
won't even go near any investment that has to end up subjected to this
certification process. That's a market-driven recognition that this
essential process is too much cloaked in mystery, delay, and excessive
cost. In short, too often the process unintentionally squelches
innovation.
What would an alternative process look like? First, TSL and TSA
would still be responsible for formulating and promulgating the
performance standards that any particular class of equipment (AIT,
checked baggage inspection, checkpoint bag inspection, trace detection,
etc.) must meet. That is an inherently Governmental task. Performance
standard-setting should be a collaboration that brings together
technologists with TSA and DHS intelligence analysts. It is the
military and intelligence community that is continuously gathering
relevant field information. Getting enough clarity to outsource testing
will almost certainly make for more rigorous, adaptable, and
transparent standards.
Then, DHS would design and conduct a procurement to select one or
(ideally) two vendors. The winners would receive multi-year charters to
establish integrated professional teams qualified to do the testing.
There should be greater transparency about the performance standards
for testing. Like an Underwriters Laboratory does in other areas. The
National Labs, non-profits such as Battelle or MITRE, some university
labs, and various for-profit corporations have the basic program
capabilities needed. The certification testing would be provided to
industry on a fee-for-service basis. If the Government likes, DHS could
take half of what it currently spends on this task and buy down the
retail testing cost with a subvention for the testing lab(s). Or take
part of that cost savings and apply those funds to results-based
achievement awards (see below).
With private lab, if a particular machine fails a test, it might
not be necessary to withdraw altogether and re-schedule. Perhaps the
same lab might also become a center of expertise that could help both
fledgling entrepreneurs and established corporations improve the
products. That's not appropriate or possible if DHS is doing the
testing. It is a given that such labs would be appropriately trained
and resourced, and routinely audited by DHS.
In the end, the testing lab would make a recommendation for a
certification to TSA, which would still own that final decision.
This model has been adopted within the European Union (EU) and it
works well. There are four E.U. labs that provide comparable
certification testing in Europe--they are located in France, the United
Kingdom, Germany, and Holland. The latter two are privately-owned
facilities.
Why is this important? Because the threats are real, and we owe it
to TSA to put in place the best possible package of incentives to spur
aggressive innovation by the private sector. A more efficient
certification process should be part of such an incentive package.
3. Results-based achievement awards.--Ten years into TSA's life, it
is worth the effort for Congress and TSA to engage in a fresh dialogue
about how best to structure TSA's research grant program for new
technologies. To date, DHS has devoted considerable dollars to various
development grants or R&D grants for firms working on what seem to be
promising avenues of study. These grants kept some struggling firms in
the hunt. Even still, only some TSA investments proved successful,
others were duds.
Alternatively, I'm convinced that a results-oriented award program
for winning technologies would offer more effective incentives,
especially when paired with a more transparent and swift certification
process. TSA needs the functional equivalent of a permanent X-Prize.
This would offer a ring to chase, notoriety to be won, and cash to be
awarded if you are the first (or perhaps also the second) to obtain
certification for a breakthrough technology.
If we had offered such a grant in 2008 or 2009 for an AT machine
that accurately identified liquid explosives in a carry-on bag, the
loathed ``3-1-1 rule'' might today be history.
These prizes would be meaningful only if they were rewards for
taking security to a noticeably higher level, not for incremental
change. A given prize should be large enough to constitute a reward and
an incentive. TSA should pay more if the private sector delivers
results faster. Achieving a TSA-endorsed goal might be worth a fixed
amount if delivered in, say, 2 years. But perhaps twice as much, if
delivered in one. I can imagine that a non-profit foundation might be
formed with public contributions to support TSA by matching, for
example, a given string of awards.
A prize would perhaps also help to re-align how investors in new
technology view the homeland security technology market. In essence,
this is simply a suggestion to look closely at how grant incentives are
awarded today, and ask if they might, at least in part, be better based
also on rewards for performance, not just promises.
I have no clue what Administrator Pistole's lawyers or his
procurement chief would say about whether TSA has the legal authority
to do this. But if the specific authorization were to come from
Congress, this subcommittee would certainly be a good place to get the
ball rolling.
4. Open source data, image standards and a TSA app factory.--In an
earlier life in the public sector, I became convinced that this final
recommendation was potentially transformational. So I gave a speech
about it one day at a large industry gathering. It quickly evoked a
reaction from TSA's technology vendor community: They hated it.
Members of this subcommittee may get the same reaction. Still, I
think it is worth insisting on this legislatively, in some way or
another.
What is the basic recommendation? To give TSA the mandate to insist
that any new core explosive detection imaging equipment (CT, AT, AIT,
and the like) sold to TSA after a reasonable date certain must compile
its image data outputs in an open-source format (format to be
determined). Moreover, the manufacturers should be required to provide
such additional software transparency as required to allow TSA to
develop and deploy modular, common-use apps that would routinely
upgrade explosive detection algorithms in its equipment.
In July of this year the Government Accountability Office published
an insightful report that is germane to this suggestion.\2\ It explains
the extraordinary complexity of the job of implementing needed
configuration management and software upgrades for TSA's inventory of
EDS equipment and other screening devices, such as electronic trace
detection. There are at least two big parts to this problem. The first
is keeping up with what is known about terrorist bomb-making
innovations. Of course, TSA has the on-going obligation to convert
intelligence about those threats into equipment performance standards
and operational protocols. But the second problem is that all of TSA's
explosive detection equipment runs with proprietary software, which TSA
has virtually no ability to control once it has bought one of these
long-life tools.
---------------------------------------------------------------------------
\2\ United States Government Accountability Office, Aviation
Security: TSA Has Enhanced Its Explosive Detection Requirements for
Checked Baggage, but Additional Screening Actions Are Needed
(Washington, July 2011), GAO-11-740.
---------------------------------------------------------------------------
So if TSA needs a specific software change, they are at the mercy
of getting it from a welter of original manufacturers. I'd vouch for
that community to say there is an enormous reservoir of professionalism
in the manufacturing community. A commonality of interest. But not
perfect alignment. TSA is more or less at the mercy of each
manufacturer of its legacy screening equipment to design and implement
system modifications as needed. Of course, TSA is expected to pay for
any such changes. The changes themselves and the costs are usually not
trivial. The GAO report shed light on some of the problems regarding
this process, both at TSA and among the vendors.
These circumstances are not unlike what existed with owners of
cellular phones prior to introduction of the iPhone, and later its
competition. By making the core software that ran these gizmos open-
source, Apple empowered individuals with specific interests to write
their own apps. When a lot of people wrote apps, those innovations
began to cascade, redefining what was possible and therefore what tools
users could expect. In recent years, the medical community has made a
similar, dramatic progress in standardizing software protocols for
essential diagnostic and business tools.
TSA finds itself with identical needs with respect to their imaging
technology providers. Changing the status quo would not be easy, but
dividends are large. In each case, the software component of a given
machine is a vendor's secret sauce. So that makes for an untidy stew at
TSA. On the other hand, if there were greater openness and
standardization with software across these systems, that would enable
greater flexibility and creativity. It would allow TSA to retain an
outrageously talented team to do configuration management and to
support innovation, matching the pace of threat changes in the real
world. This would take a bit of time and a lot more detailed planning,
but again, it would offer a transformational responsiveness and
strengthen homeland security.
In close, I'd like again to thank the Members of the subcommittee
for affording me the time to present these four ideas. Taken together,
they constitute a cluster of tools that could give TSA remarkable new
capabilities to spur innovation, acquire and utilize technology, and
create economic opportunity.
Mr. Rogers. Next, we have Steve Lord. He is the GAO
executive responsible for directing GAO's numerous engagements
on the aviation surface transportation issues and regularly
discusses these issues before Congress and at industry forums.
He has recently conducted in-depth reviews of TSA's of
passenger checked baggage and air cargo screening programs,
which led to significant improvements at TSA's operations.
Before his appointment to senior executive service in 2007, he
led GAO's work on a number of key international security,
finance, and trade issues. Mr. Lord has received numerous GAO
awards for meritorious service and outstanding achievement.
Mr. Lord, we appreciate your presence before this committee
and on the many occasions you have been here, and look forward
to your testimony.
You are recognized.
STATEMENT OF STEPHEN M. LORD, DIRECTOR, HOMELAND SECURITY,
GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Lord. Thank you, Mr. Chairman. I am pleased to be here
today to discuss TSA's progress and related challenges in not
only developing but fielding new technology. As you and
Representative Thompson have indicated, these programs
represent billions of dollars in life-cycle costs. This is
obviously a very important issue.
What I would like to do today is summarize some of the key
insights gleaned from our recent work in this area related to
DHS and TSA acquisition. They are in the three following areas:
Our work has emphasized the importance of, No. 1, developing
clear program requirements; our work has also demonstrated the
importance of testing and conducting oversight of the
acquisition process; and third, our work also has highlighted
the importance of conducting cost/benefit analysis to guide
your acquisition and deployment decisions.
Regarding the first point, requirements, our past work has
highlighted the importance of setting clear requirements up
front. Otherwise, you have difficulty further in the process in
achieving successful outcomes and you run the risk of
increasing the costs of your programs if it is unclear what you
are trying to achieve. For example, in June, 2010, we reported
that over half of the 15 DHS programs we reviewed in detail
lacked documented approval of key planning, requirement
setting, and program baseline documents. These are all very
important planning steps that you need to conduct up-front to
ensure you have good outcomes.
Regarding TSA, we also found that TSA faced similar
challenges in identifying and meeting requirements in some
programs. For example, in July, a few months ago, we reported
that TSA revised it is checked baggage explosive detection
requirements in January of this year, which we view as a good
thing to better detect new threats. However, while the specific
numbers are sensitive security information, some of the current
machines are configured to detect explosives at the 2005 levels
while the other machines are configured to detect explosives at
the 1998 levels.
So we recommended, given the disparities between the
current requirements and the current capabilities, we recommend
that TSA develop an action plan to better ensure new and
deployed equipment meets current requirements. TSA agreed with
our recommendation and has begun to take appropriate steps.
In a recent report, we also recommended that TSA establish
a better process for communicating with the vendor community,
these are issues that Mr. Jackson and Ms. Duke previously
raised, such as through industry days and kickoff meetings.
This has been a reoccurring issue. We identified similar
communication issues in our 2009 report.
Regarding testing, our prior work has identified several
challenges which can lead to problems down the road in
achieving desired incomes. For example, we recently reported on
the role played by S&T's test and evaluation and standards
office. This is an important development. TSA stood this office
up to ensure proper testing at the component level. We found it
could do a better job in reviewing and approving the testing
agents conducting testing across DHS.
Another testing issue we identified is related to our July
checked baggage screening report. We found TSA was trying to
collect explosives test data as the same time as it was
procuring new baggage screening machines. This is not to say it
couldn't be done. This major strategy is a higher risk. We
found that this led to some delays in the acquisition process.
Thus, we recommended that TSA collect the needed data before
starting the procurement process for new machines and upgrades.
In the earlier report, and as previously referenced by
Representative Thompson, we found that TSA deployed explosive
trace portals, or puffers, before they demonstrated reliable
performance in an airport environment. As a result of this
setback, TSA has agreed and changed their processes to better
test new technology before deploying it to airports.
Finally, our prior work has shown that cost/benefit
analysis can be a useful tool when making acquisition
decisions. The good news is that in June of this year, in
response to these and other reports, the Department has
reported taking steps to strengthen its investment and
acquisition process. But as we reported earlier, it is too soon
to tell whether this is going to have the desired effect.
Mr. Chairman, this concludes my statement. I look forward
to any questions you may have.
[The prepared statement of Mr. Lord follows:]
Prepared Statement of Stephen M. Lord
September 22, 2011
gao highlights
Highlights of GAO-11-957T, a testimony to the Subcommittee on
Transportation Security, Committee on Homeland Security, House of
Representatives.
Why GAO Did This Study
Within the Department of Homeland Security (DHS), the
Transportation Security Administration (TSA) is responsible for
developing and acquiring new technologies to address homeland security
needs. TSA's acquisition programs represent billions of dollars in
life-cycle costs and support a wide range of aviation security missions
and investments including technologies used to screen passengers,
checked baggage, and air cargo, among others. GAO's testimony addresses
three key challenges identified in past work: (1) Developing technology
program requirements, (2) overseeing and conducting testing of new
technologies, and (3) incorporating information on costs and benefits
in making technology acquisition decisions. This statement also
addresses recent DHS efforts to strengthen its investment and
acquisition processes. This statement is based on reports and
testimonies GAO issued from October 2009 through September 2011 related
to TSA's efforts to manage, test, and deploy various technology
programs.
What GAO Recommends
GAO is not making any new recommendations. In prior work, GAO made
recommendations to address challenges related to deploying EDS to meet
requirements, overseeing and conducting testing of new technologies,
and incorporating information on costs and benefits in making
technology acquisition decisions. DHS and TSA concurred and described
actions underway to address the recommendations.
homeland security: dhs and tsa acquisition and development of new
technologies
What GAO Found
GAO's past work has found that TSA has faced challenges in
developing technology program requirements on a systemic and individual
basis. Program performance cannot be accurately assessed without valid
baseline requirements established at the program start. In June 2010,
GAO reported that over half of the 15 DHS programs (including 3 TSA
programs) GAO reviewed awarded contracts to initiate acquisition
activities without component or Department approval of documents
essential to planning acquisitions, setting operational requirements,
or establishing acquisition program baselines. At the program level, in
July 2011, GAO reported that in 2010 TSA revised its explosive
detection systems (EDS) requirements to better address current threats
and plans to implement these requirements in a phased approach.
However, GAO reported that some number of the EDSs in TSA's fleet are
configured to detect explosives at the levels established in the 2005
requirements and TSA did not have a plan with time frames needed to
deploy EDSs to meet the current requirements.
GAO has also reported DHS and TSA challenges in overseeing and
testing new technologies. For example, in July 2011, GAO reported that
TSA experienced challenges in collecting data on the physical and
chemical properties of certain explosives needed by vendors to develop
EDS detection software and needed by TSA before procuring and deploying
EDSs to airports. TSA and DHS Science and Technology Directorate have
experienced these challenges because of problems associated with safely
handling and consistently formulating some explosives. The challenges
related to data collection for certain explosives have resulted in
problems carrying out the EDS procurement as planned. In addition, in
October 2009, GAO reported that TSA deployed explosives trace portals,
a technology for detecting traces of explosives on passengers at
airport checkpoints, in January 2006 even though TSA officials were
aware that tests conducted during 2004 and 2005 on earlier models of
the portals suggested the portals did not demonstrate reliable
performance in an airport environment. In June 2006, TSA halted
deployment of the explosives trace portals because of performance
problems and high installation costs.
GAO's prior work has shown that cost-benefit analyses help
Congressional and agency decision-makers assess and prioritize resource
investments and consider potentially more cost-effective alternatives,
and that without this ability, agencies are at risk of experiencing
cost overruns, missed deadlines, and performance shortfalls. GAO has
reported that TSA has not consistently included these analyses in its
acquisition decisionmaking.
In June 2011, DHS reported that it is taking steps to strengthen
its investment and acquisition management processes by implementing a
decision-making process at critical phases throughout the investment
life cycle. The actions DHS reports taking to address the management of
its acquisitions and the development of new technologies are positive
steps and, if implemented effectively, could help the Department
address many of these challenges.
Chairman Rogers, Ranking Member Jackson Lee, and Members of the
subcommittee: I am pleased to be here today to discuss our past work
examining the Transportation Security Administration's (TSA) progress
and challenges in developing and acquiring new technologies to address
homeland security needs. TSA acquisition programs represent billions of
dollars in life-cycle costs and support a wide range of aviation
security missions and investments including technologies used to screen
passengers, checked baggage, and air cargo, among others. Within the
Department of Homeland Security (DHS), the Science and Technology
Directorate (S&T) has responsibility for coordinating and conducting
basic and applied research, development, demonstration, testing, and
evaluation activities relevant to DHS components, which also have
responsibilities for developing, testing, acquiring, and deploying such
technologies. For example, TSA is responsible for securing the Nation's
transportation systems and, with S&T, researching, developing, and
deploying technologies to, for example, screen airline passengers and
their property.
In recent years, we have reported that DHS has experienced
challenges in managing its multibillion-dollar acquisition efforts,
including implementing technologies that did not meet intended
requirements and were not appropriately tested and evaluated, and has
not consistently included completed analyses of costs and benefits
before technologies were implemented.
My testimony today focuses on the key findings of our prior work
related to TSA's efforts to acquire and deploy new technologies to
address homeland security needs. Our past work has identified three key
challenges: (1) Developing technology program requirements, (2)
overseeing and conducting testing of new technologies, and (3)
incorporating information on costs and benefits in making technology
acquisition decisions. This statement will also discuss recent DHS and
TSA efforts to strengthen its investment and acquisition processes.
This statement is based on reports and testimonies we issued from
October 2009 through September 2011 related to TSA's efforts to manage,
test, and deploy various technology programs.\1\ For our past work, we
reviewed program schedules, planning documents, testing reports, and
other acquisition documentation. For some of the programs we discuss in
this testimony, we conducted site visits to a range of facilities, such
as national laboratories, airports, and other locations to observe
research, development, and testing efforts. We also conducted
interviews with DHS component program managers and S&T officials to
discuss issues related to individual programs. We conducted this work
in accordance with generally accepted Government auditing standards.
More detailed information on the scope and methodology from our
previous work can be found within each specific report.
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\1\ See the related products list at the end of this statement.
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background
The Aviation and Transportation Security Act (ATSA) established TSA
as the Federal agency with primary responsibility for securing the
Nation's civil aviation system, which includes the screening of all
passenger and property transported from and within the United States by
commercial passenger aircraft.\2\ In accordance with ATSA, all
passengers, their accessible property, and their checked baggage are
screened pursuant to TSA-established procedures at the 463 airports
presently regulated for security by TSA. These procedures generally
provide, among other things, that passengers pass through security
checkpoints where they and their identification documents, and
accessible property, are checked by transportation security officers
(TSO), other TSA employees, or by private-sector screeners under TSA's
Screening Partnership Program.\3\ Airport operators, however, also have
direct responsibility for implementing TSA security requirements such
as those relating to perimeter security and access controls, in
accordance with their approved security programs and other TSA
direction.
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\2\ See Pub. L. No. 107-71, 115 Stat. 597 (2001). For purposes of
this testimony, ``commercial passenger aircraft'' refers to a U.S.- or
foreign-based air carrier operating under TSA-approved security
programs with regularly scheduled passenger operations to or from a
U.S. airport.
\3\ Private-sector screeners under contract to and overseen by TSA,
and not TSOs, perform screening activities at the 16 airports
participating in TSA's Screening Partnership Program as of July 2011.
See 49 U.S.C. 44920.
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TSA relies upon multiple layers of security to deter, detect, and
disrupt persons posing a potential risk to aviation security. These
layers include behavior detection officers (BDOs), who examine
passenger behaviors and appearances to identify passengers who might
pose a potential security risk at TSA-regulated airports;\4\ travel
document checkers, who examine tickets, passports, and other forms of
identification; TSOs responsible for screening passengers and their
carry-on baggage at passenger checkpoints, using X-ray equipment,
magnetometers, Advanced Imaging Technology, and other devices; random
employee screening; and checked-baggage screening systems.\5\
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\4\ TSA designed the Screening Passengers by Observation Techniques
program to provide BDOs with a means of identifying persons who may
pose a potential security risk at TSA-regulated airports by focusing on
behaviors and appearances that deviate from an established baseline and
that may be indicative of stress, fear, or deception.
\5\ Advanced Imaging Technology screens passengers for metallic and
nonmetallic threats including weapons, explosives, and other objects
concealed under layers of clothing.
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DHS's Science and Technology Directorate (S&T) and TSA have taken
actions to coordinate and collaborate in their efforts to develop and
deploy technologies for aviation security. For example, they entered
into a 2006 memorandum of understanding for using S&T's Transportation
Security Laboratory, and they established the Capstone Integrated
Product Team for Explosives Prevention in 2006 to help DHS, TSA, and
the U.S. Secret Service to, among other things, identify priorities for
explosives prevention.
dhs and tsa have experienced challenges in developing and meeting key
performance requirements for various technologies
Our past work has found that technology program performance cannot
be accurately assessed without valid baseline requirements established
at the program start. Without the development, review, and approval of
key acquisition documents, such as the mission need statement, agencies
are at risk of having poorly defined requirements that can negatively
affect program performance and contribute to increased costs.\6\ For
example, in June 2010, we reported that over half of the 15 DHS
programs we reviewed awarded contracts to initiate acquisition
activities without component or Department approval of documents
essential to planning acquisitions, setting operational requirements,
or establishing acquisition program baselines.\7\ For example, TSA's
Electronic Baggage Screening Program did not have a Department-approved
program baseline or program requirements, but TSA is acquiring and
deploying next-generation explosive detection technology to replace
legacy systems. We made a number of recommendations to help address
issues related to these procurements as discussed below. DHS has
generally agreed with these recommendations and, to varying degrees,
has taken actions to address them.
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\6\ The mission need statement outlines the specific functional
capabilities required to accomplish DHS's mission and objectives, along
with deficiencies and gaps in these capabilities.
\7\ GAO, Department of Homeland Security: Assessments of Selected
Complex Acquisitions, GAO-10-588SP (Washington, DC: June 30, 2010).
Three of 15 were TSA programs.
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In addition, our past work has found that TSA faces challenges in
identifying and meeting program requirements in a number of its
programs. For example:
In July 2011, we reported that TSA revised its explosive
detection system (EDS) requirements to better address current
threats and plans to implement these requirements in a phased
approach.\8\ However, we reported that some number of the EDSs
in TSA's fleet are configured to detect explosives at the
levels established in the 2005 requirements. The remaining EDSs
are configured to detect explosives at 1998 levels. When TSA
established the 2005 requirements, it did not have a plan with
the appropriate time frames needed to deploy EDSs to meet the
requirements. To help ensure that EDSs are operating most
effectively, we recommended that TSA develop a plan to deploy
and operate EDSs to meet the most recent requirements to ensure
new and currently deployed EDSs are operated at the levels in
established requirements.\9\ DHS concurred with our
recommendation and has begun taking action to address them; for
example, DHS reported that TSA has developed a plan to evaluate
its current fleet of EDSs to determine the extent to which they
comply with these requirements. However, our recommendation is
intended to ensure that TSA operate all EDSs at airports at the
most recent requirements. Until TSA develops a plan identifying
how it will approach the upgrades for currently deployed EDSs--
and the plan includes such items as estimated costs and the
number of machines that can be upgraded--it will be difficult
for TSA to provide reasonable assurance that its upgrade
approach is feasible or cost-effective. Further, while TSA's
efforts are positive steps, it is too early to assess their
effect or whether they address our recommendation.
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\8\ GAO, Aviation Security: TSA Has Enhanced Its Explosives
Detection Requirements for Checked Baggage, but Additional Screening
Actions Are Needed, GAO-11-740 (Washington, DC: July 11, 2011).
\9\ GAO-11-740. An EDS machine uses computed tomography technology
to automatically measure the physical characteristics of objects in
baggage. The system automatically triggers an alarm when objects that
exhibit the physical characteristics of explosives are detected.
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In October 2009, we reported that TSA passenger screening
checkpoint technologies were delayed because TSA had not
consistently communicated clear requirements for testing the
technologies.\10\ We recommended that TSA evaluate whether
current passenger screening procedures should be revised to
require the use of appropriate screening procedures until TSA
determined that existing emerging technologies meet their
functional requirements in an operational environment. TSA
agreed with this recommendation. However, communications issues
with the business community persist. In July 2011, we reported
that vendors for checked-baggage screening technology expressed
concerns about the extent to which TSA communicated with the
business community about the current EDS procurement.\11\ TSA
agreed with our July 2011 recommendation to establish a process
to communicate information regarding TSA's EDS acquisition to
EDS vendors in a timely manner and reported taking actions to
address it such as soliciting more feedback from vendors
through kickoff meetings, industry days, and classified
discussions of program requirements.
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\10\ GAO, Aviation Security: DHS and TSA Have Researched,
Developed, and Begun Deploying Passenger Checkpoint Screening
Technologies, but Continue to Face Challenges, GAO-10-128 (Washington,
DC: Oct. 7, 2009).
\11\ GAO-11-740.
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dhs and tsa have encountered challenges in overseeing and testing new
technologies
Our prior work has also shown that not resolving problems
discovered during testing can sometimes lead to costly redesign and
rework at a later date. Addressing such problems before moving to the
acquisition phase can help agencies better manage costs. Specifically:
In June 2011 we reported that S&T's Test & Evaluation and
Standards Office, responsible for overseeing test and
evaluation of DHS's major acquisition programs, reviewed or
approved test and evaluation documents and plans for programs
undergoing testing, and conducted independent assessments for
the programs that completed operational testing.\12\ DHS
senior-level officials considered the office's assessments and
input in deciding whether programs were ready to proceed to the
next acquisition phase. However, the office did not
consistently document its review and approval of components'
test agents--a Government entity or independent contractor
carrying out independent operational testing for a major
acquisition. In addition, the office did not document its
review of other component acquisition documents, such as those
establishing programs' operational requirements. We
recommended, among other things, that S&T develop mechanisms to
document its review of component acquisition documentation. DHS
concurred and reported actions underway to address them.
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\12\ GAO, DHS Science and Technology: Additional Steps Needed to
Ensure Test and Evaluation Requirements Are Met. GAO-11-596.
(Washington, DC: June 15, 2011).
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In July 2011, we reported that TSA experienced challenges in
collecting explosives data on the physical and chemical
properties of certain explosives needed by vendors to develop
EDS detection software.\13\ These data are also needed by TSA
for testing the machines to determine whether they meet
established requirements prior to their procurement and
deployment to airports. TSA and S&T have experienced these
challenges because of problems associated with safely handling
and consistently formulating some explosives. The challenges
related to data collection for certain explosives have resulted
in problems carrying out the EDS procurement as planned.
Specifically, attempting to collect data for certain explosives
while simultaneously pursuing the EDS procurement delayed the
EDS acquisition schedule. We recommended that TSA develop a
plan to ensure that TSA has the explosives data needed for each
of the planned phases of the 2010 EDS requirements before
starting the procurement process for new EDSs or upgrades
included in each applicable phase. DHS stated that TSA modified
its strategy for the EDS's competitive procurement in July 2010
in response to the challenges in working with the explosives
for data collection by removing the data collection from the
procurement process. While TSA's plan to separate the data
collection from the procurement process is a positive step, we
feel, to fully address our recommendation, a plan is needed to
establish a process for ensuring that data are available before
starting the procurement process for new EDSs or upgrades for
each applicable phase.
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\13\ GAO-11-740
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In July 2011, we also reported that TSA revised EDS
explosives detection requirements in January 2010 to better
address current threats and plans to implement these
requirements in a phased approach. TSA had previously revised
the EDS requirements in 2005 though it did not begin operating
EDS to meet the 2005 requirements until 2009. Further, TSA
deployed a number of EDSs that had the software necessary to
meet the 2005 requirements, but because the software was not
activated, these EDSs were still detecting explosives at levels
established before TSA revised the requirements in 2005. TSA
officials stated that prior to activating the software in these
EDSs, they must conduct testing to compare the false-alarm
rates for machines operating at one level of requirements to
those operating at another level of requirements. According to
TSA officials, the results of this testing would allow them to
determine if additional staff are needed at airports to help
resolve false alarms once the EDSs are configured to operate at
a certain level of requirements. TSA officials told us that
they plan to perform this testing as a part of the current EDS
acquisition.
In October 2009, we reported that TSA deployed explosives
trace portals, a technology for detecting traces of explosives
on passengers at airport checkpoints, in January 2006 even
though TSA officials were aware that tests conducted during
2004 and 2005 on earlier models of the portals suggested the
portals did not demonstrate reliable performance in an airport
environment.\14\ TSA also lacked assurance that the portals
would meet functional requirements in airports within estimated
costs and the machines were more expensive to install and
maintain than expected. In June 2006, TSA halted deployment of
the explosives trace portals because of performance problems
and high installation costs. We recommended that to the extent
feasible, TSA ensure that tests are completed before deploying
checkpoint screening technologies to airports. DHS concurred
with the recommendation and has taken action to address it,
such as requiring more-recent technologies to complete both
laboratory and operational tests prior to deployment. For
example, TSA officials stated that, unlike the explosive trace
portal, operational testing for the Advanced Imaging Technology
(AIT) was successfully completed late in 2009 before its
deployment was fully initiated. We are currently evaluating the
testing conducted on AIT as part of an on-going review.
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\14\ GAO-10-128.
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tsa has not consistently incorporated information on costs and benefits
in making acquisition decisions
According to the National Infrastructure Protection Plan, security
strategies should be informed by, among other things, a risk assessment
that includes threat, vulnerability, and consequence assessments,
information such as cost-benefit analyses to prioritize investments,
and performance measures to assess the extent to which a strategy
reduces or mitigates the risk of terrorist attacks.\15\ Our prior work
has shown that cost-benefit analyses help Congressional and agency
decision makers assess and prioritize resource investments and consider
potentially more cost-effective alternatives, and that without this
ability, agencies are at risk of experiencing cost overruns, missed
deadlines, and performance shortfalls. For example, we have reported
that TSA has not consistently included these analyses in its
acquisition decision making. Specifically:
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\15\ DHS, National Infrastructure Protection Plan (Washington, DC:
June 2006). In 2009, DHS issued an updated plan that replaced the one
issued in 2006.
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In October 2009, we reported that TSA had not yet completed
a cost-benefit analysis to prioritize and fund its technology
investments for screening passengers at airport
checkpoints.\16\ One reason that TSA had difficulty developing
a cost-benefit analysis was that it had not yet developed life-
cycle cost estimates for its various screening technologies. We
reported that this information was important because it would
help decision makers determine, given the cost of various
technologies, which technology provided the greatest mitigation
of risk for the resources that were available. We recommended
that TSA develop a cost-benefit analysis. TSA agreed with this
recommendation and has completed a life-cycle cost estimate,
but has not yet completed a cost-benefit analysis.
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\16\ GAO-10-128.
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In March 2010, we reported that TSA had not conducted a
cost-benefit analysis to guide the initial AIT deployment
strategy.\17\ Such an analysis would help inform TSA's judgment
about the optimal deployment strategy for the AITs, as well as
provide information to inform the best path forward,
considering all elements of the screening system, for
addressing the vulnerability identified by the attempted
December 25, 2009, terrorist attack. We recommended that TSA
conduct a cost-benefit analysis. TSA completed a cost-
effectiveness analysis in June 2011 and provided it to us in
August 2011. We are currently evaluating this analysis as part
of our on-going AIT review.
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\17\ GAO-10-484T.
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dhs has efforts underway to strengthen acquisition and technology
development
Since DHS's inception in 2003, we have designated implementing and
transforming DHS as high-risk because DHS had to transform 22
agencies--several with major management challenges--into one
department. This high-risk area includes challenges in strengthening
DHS's management functions, including acquisitions; the effect of those
challenges on DHS's mission implementation; and challenges in
integrating management functions within and across the Department and
its components. Failure to effectively address DHS's management and
mission risks could have serious consequences for U.S. National and
economic security.\18\
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\18\ GAO, High Risk Series: An Update, GAO-11-278 (Washington, DC:
February, 2011).
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In part because of the problems we have highlighted in DHS's
acquisition process, implementing and transforming DHS has remained on
our high-risk list. DHS currently has several plans and efforts
underway to address the high-risk designation as well as the more
specific challenges related to acquisition, technology development, and
program implementation that we have previously identified.
In June 2011, DHS reported to us that it is taking steps to
strengthen its investment and acquisition management processes across
the Department by implementing a decision-making process at critical
phases throughout the investment life cycle.\19\ For example, DHS
reported that it plans to establish a new model for managing
Department-wide investments across their life cycles. Under this plan,
S&T would be involved in each phase of the investment life cycle and
participate in new councils and boards DHS is planning to create to
help ensure that test and evaluation methods are appropriately
considered as part of DHS's overall research and development investment
strategies. According to DHS, S&T will help ensure that new
technologies are properly scoped, developed, and tested before being
implemented. DHS also reports that it is working with components to
improve the quality and accuracy of cost estimates and has increased
its staff during fiscal year 2011 to develop independent cost
estimates, a GAO best practice, to ensure the accuracy and credibility
of program costs.\20\ DHS reports that four cost estimates for level 1
programs have been validated to date, but did not explicitly identify
whether any of the Life Cycle Cost Estimates were for TSA programs.\21\
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\19\ GAO-10-588SP.
\20\ GAO, GAO Cost Estimating and Assessment Guide: Best Practices
for Developing and Managing Capital Program Costs, GAO-09-3SP
(Washington, DC: Mar. 2, 2009).
\21\ Level 1 programs are those that have estimated life-cycle
costs in excess of $1 billion and are reviewed at the Department level.
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The actions DHS reports taking or has underway to address the
management of its acquisitions and the development of new technologies
are positive steps and, if implemented effectively, could help the
Department address many of these challenges. However, showing
demonstrable progress in executing these plans is key. In the past, DHS
has not effectively implemented its acquisition policies, in part
because it lacked the oversight capacity necessary to manage its
growing portfolio of major acquisition programs. Since DHS has only
recently initiated these actions, it is too early to fully assess their
effect on the challenges that we have identified in our past work.
Going forward, we believe DHS will need to demonstrate measurable,
sustainable progress in effectively implementing these actions.
Chairman Rogers, Ranking Member Jackson Lee, and Members of the
subcommittee, this concludes my prepared statement. I would be pleased
to respond to any questions that you or other Members of the
subcommittee may have.
Mr. Rogers. I thank you for those comments. I now recognize
myself for my opening questions.
Mr. Lord, you are right on the money when you talked about
the failure to adhere to the 2005 standards that TSA has set.
When you raised that point in your opening statement, you said
that TSA acknowledged that was a problem and was working to
correct it. Why haven't they corrected it already, and did they
have set a time line? It is crazy to still be using 1998
standards. How did they get by that long without anybody
raising this issue?
Mr. Lord. Well, we were somewhat surprised. When we looked
at the 2005 standards we found that it took 4 years to start
implementing them. So our point was we think it is a positive
development. They are constantly updating and refining the
standards. But we were concerned about the substantial lag
between issuing the standards and integrating them in the
machines. I don't want to oversimplify the complexity of the
task. These are very complicated of technology. I am not sure
we ever got a really clear response. Some of it was related to
TSA's need to do some additional testing to see how the false
alarm rates were affected. That could conceivably change the
number of people you needed in the airport to check bags that
are kicked aside.
The good news is they wholeheartedly agree it shouldn't
take that long, and they have instituted some changes to
improve the process. As they will point out, the 1998 standards
at the time were considered world-class standards.
Mr. Rogers. Well, I guess what I am hoping is when you say
they wholeheartedly agree and are going to address it, have
they given a time line that they are committed to have
implemented these recommendations?
Mr. Lord. I am not sure they have a very specific time
line, but I am convinced they are taking action to address it.
I will have to get back to your staff if they have committed to
a specific time line.
Mr. Rogers. Do you have a time line to go back to revisit
the issue and see if they have followed through?
Mr. Lord. Yes. Under our process, any time we conduct a
recommendation, we conduct thorough follow-up after our report
is issued to help close the loop. Obviously, we are just as
interested as the committee in seeing these important changes
in the process are made.
Mr. Rogers. Great.
Ms. Duke, you talked about needed alignment changes. Can
you talk more fully about that?
Ms. Duke. The Department operates in the business lines,
which include the CF, chief information office, chief financial
officer, and procurement and human capital, security and
facilities, under a functional integration model, which means
that in the operating components, the operating components own
those business lines. However, the chiefs of the Department
that report to the Under Secretaries for Management have
functional authority.
Over time, the Department has refined those authorities to
ensure that--to work towards ensuring that the right controls
are in place--the oversight, the standardization of policy.
That would be typical in a department, where a department would
exercise over its operating components. So I think that is
important in continuing to strengthen and refine those
functional authorities of the business line chiefs to have the
Department operate more effectively.
Mr. Rogers. You recall when I was Chairman of the
Management and Oversight Subcommittee, you had raised the issue
of inadequate number of procurement office staff. Do you see
that having been remedied since your departure?
Ms. Duke. Yes. The number of procurement staff has gotten
better. I think what continues to have to work on is the other
pieces of staffing properly the other types of acquisition
professionals, like the program managers; test and evaluation
is another acquisition career field; logistics, cost
estimating. These are all other types of acquisition
professionals that DHS continues to try to build a need to get
the full answer to running these programs more effectively.
Mr. Rogers. Mr. Jackson, you talked about the high cost of
certification under the current structure. Why is it so
expensive and cumbersome right now and how would it be better
if we worked in a different direction?
Mr. Jackson. Right now, it is a fragmented process. You
have literally to take machines that you want certified,
oftentimes they have to make multiple machines for the
certification process, but you have to take them to multiple
locations--to Tindall for HME analysis and other unstable
explosives. For other more traditional explosives, that is done
in New Jersey at the TSL lab. Then you have early testing in a
TSA test environment, and in the field you have pre-
certification work to do as well.
It is just simply a bureaucratically dispersed and not
adequately focused program. It is very, very expensive and
becomes a checklist process. You either pass or fail. If you
fail, it is oftentimes, if you talk to the people who have been
doing this, very unclear to them why exactly they failed and
what is necessary to get back in the game. Oftentimes, there
are mistakes made by the people submitting the machines. They
are sort of obvious and can be corrected. But there is work on
both sides that needs to happen.
The model that has been used in Germany, for example, has
been very successful in making a more collaborative process
while focusing the government on the inherently governmental
process of defining the performance requirements that they want
from the output, which really goes to this whole question about
what are we trying to get these machines to do.
More and better work can be done there. Greater clarity,
greater transparency. Then have a group of people that can
maybe perhaps--have two groups that can compete this process
and work it more effectively.
Mr. Rogers. I thank you.
I recognize the Ranking Member for any questions he may
have.
Mr. Thompson. Thank you very much, Mr. Chairman.
It has often been said hindsight is 20/20. Ms. Duke, Mr.
Jackson, you have been here, done that. You have now gone into
another part of your professional career. I want to get from
you what it is you tried to do to improve this inside the
Department and why we didn't get it done. Do you understand? So
that going forward we can revisit it from a committee
perspective.
Ms. Duke. Yes, Mr. Thompson. What I tried to do in my
positions as Chief Procurement Officer and Under Secretary of
Management was to build the acquisition system. I think that we
made good starts. I think the reason we didn't finish during my
tenure was because there was so much to do. We were in the
right direction. I think the work of Under Secretary Borras is
taking the Department further in that direction, but just not
the time to do it.
For instance, the test and evaluation function that you
mentioned in your opening statement didn't exist. So during the
tenure that I had at the Department, we set up the test and
evaluation function. Now, the current leadership is working to
try to refine that to make sure it handles not only
developmental testing, which is the part of testing that
doesn't meet the specification, but also operational testing,
which gets to the point of: Does it perform for the intended
use in the operational environment?
So I think that we set the building blocks in terms of what
needed to happen. The carry-through has to happen to make it
fully functional.
I think another point is that when you talk about
effectiveness, it is the balance of cost, schedule, and
performance. I believe that in the aftermath of 9/11, there was
such an emphasis on schedule--fast, fast, fast--that in the
balance of cost, schedule, and performance, there sometimes was
an imbalance. And schedule, getting things out quickly, ruled.
I think that there is a necessity for continued homeland
security excellence to balance being nimble and quick and being
postured in a nimble way to be able to react to changes in the
terror threat, but also have the stability where you are
balancing schedule with cost and performance.
Mr. Thompson. Mr. Jackson.
Mr. Jackson. Congressman, I think that Elaine is correct in
everything that she said, and I would just underscore a couple
of points. The sense of urgency at the outset of the
Department's formation was substantial and animated by an acute
awareness that another attack could be upon us each day. So to
some degree, it was a rush job to build DHS and then to fill it
out in a more professional and effective and efficient fashion.
That is not an excuse for mistakes that we have made in that
period, but it does explain that the tradeoffs in the sense of
trying to build a new organization from scratch and to deliver
a capable set of assets into the field was a very complex set
of tradeoffs.
I think what I am trying to suggest this morning is that if
you try going forward and focus on things that can have
transformational change at the points of failure or the points
of opportunity that lay on the field, then that gives you a
constructive and positive way to look about going ahead. It is
important to understand the failures of the past, as I think
your opening remarks absolutely make clear.
Mr. Thompson. Thank you. As you know, we have voted in the
House on a budget. A lot of those items that you have
indicated, we will have to do within S&T. Those funds have been
cut.
Now you referenced Under Secretary Borras. He basically has
offered testimony to us that if he has to lay off 70 percent of
the management directorate staff, that creates a problem.
Ms. Duke, you referenced the fact that under your tenure we
as a Congress plussed-up your ability to hire more people. Do
you see the reduction in the budget for the Department as
creating a potential problem/vulnerability for S&T?
Ms. Duke. I believe that if Congress chooses to fund a
program, that it must fund the people to manage the program. So
if the decision is to fund major acquisition programs such as
Secure Border or any type of program or TSA technology, that it
must fund the appropriate people to manage that program. It
goes back to my written statement point of when the money is
appropriated to an agency or department, it has the fiduciary
responsibility to manage that money. So I do think that we have
to continue to fund the Federal employees to manage those
programs--the acquisition workforce--yes.
Mr. Thompson. So if we create new programs, new pilots, or
whatever, and not put the resources to operate them, then we
put those pilots or demonstrations at risk?
Ms. Duke. Well, one shouldn't be surprised if they don't do
as well as one had hoped if we don't fund the people to
actually manage the programs, yes.
Mr. Thompson. Thank you.
I yield back.
Mr. Rogers. I thank the gentleman.
Ms. Duke, in looking at the TSA and the industry, how can
we get them to partner better? What, in simple lay terms, would
be the thing that you would suggest first and foremost?
Ms. Duke. I think starting communications early is first
and foremost. Mr. Lord mentioned changing the standards. TSA
could and should be communicating with industry early on.
Mr. Rogers. By ``early on,'' what do you mean? Give me some
time lines.
Ms. Duke. Before setting the standards. New standards, new
specifications should not be a surprise to industry. So as it
is setting its standards, I recommend that TSA be dialoguing
with industry and see what is state-of-the-art? What is
possible? What is the cost/benefit tradeoff between different
standards that will meet the terrorist threat?
Mr. Rogers. You were with the Navy. Does the DOD do what
you are talking about in their procurement process?
Ms. Duke. I think every Federal agency can do it more
effectively. There is, I will call it a systemic fear that if
the Federal Government talks with industry effectively, that it
increases the chance of protest. So there is kind of a
prejudice to cut off dialogue really just at the point where it
would be most beneficial to the program. So I think that what
DHS, DOD needs to do is manage that risk and make sure that the
communications are fair, meaning they don't just favor a
company. So do it maybe in open forums. I believe that doing
them orally sometimes helps.
When you get back into the written questions and answers,
it kind of looks legalistic. So I think there is more
opportunity for oral forums. I think a lot could be done and
still not increase the risk of protest.
Mr. Rogers. But what you are talking about, I take it, is
more than just having industry days?
Ms. Duke. Yes. I think industry days are very useful, but
they are too late. They need to stay, but then there needs to
be predecessors to industry day.
Mr. Rogers. Mr. Jackson, you talked in your opening
statement about an idea for lease processes. How would that
save the Department money?
Mr. Jackson. Well, first of all, the proposals that have
been laid on the table would make these expensive inline
baggage system investments and other investments in the
technology happen much faster. So you save the time, cost of
money, and getting them into the field more quickly. In
addition, frankly, by cutting through some of the bureaucratic
layers of TSA oversight in a traditional grant-based approach
to this, you cut out some of the cost to TSA of the overhead to
paying consultants to stand around and watch people to make
sure they are doing it right.
You still have, I think, an urgent necessity to have high
standards of performance and very clear objectives about what
the performance standards are. For example, in what a machine
must do and what it must not do; up time, down time. All these
types of indicators are crucial to having clarity and success
in the mission. But, frankly, there is just a much more
efficient way to put capital to work there.
Also, if you are constrained with resources, as we are
today, in trying to get done a substantial backlog of work, you
have to figure out how to find the cash to do that. You can
leverage an awful lot of money and get that work done up-front
without having to obligate the entirety of a project's cost and
hold it in escrow at TSA while the work is done.
So I think with an approach that is very common-sense and
uses private sector capabilities that are structured through a
government-to-government contract--the airport authority with
TSA--that should be something that we figure out how to work.
It is not that hard. It is a very transformational way,
however, to intrude a lot more efficiency and effectiveness,
and especially over the next couple of years where I think the
recapitalization problem is going to leach out the funds that
would otherwise be used for some of this backlog of inline
systems, that it is an especially timely thing to do, and the
cost of capital is at an all-time low, so it is an effective
way to do this.
Mr. Rogers. Is that process being used by any other
governmental entity that you are aware of?
Mr. Jackson. Variations of it are. For example, at LAX,
using a basic grant agreement, Delta had worked with a private
sector vendor to essentially build and maintain an in-line
system for the terminal that Delta operates out of. Southwest
Airlines has done a similar thing at multiple different
airports.
So there is experience with this. At Denver, for example,
after
9/11, the airport was very impatient, rightfully so, to get a
big EDS machine deployment working. So they worked with the
manufacturer to do a financing project for that, for which TSA
came behind and did reimbursements.
So there is plenty of experience in the private sector of
how to do these sort of things. There is no one group or way to
sign on to make it work. There just needs to be some
flexibility, in my view, to have a very fundamental thing that
allows the airport authority to structure and take the risk for
an investment that supports themselves, the airlines, and TSA,
and then allow TSA simply to buy that as a service from that
airport authority. That is a dramatic transformation and
energizing way to give TSA the tools they need to do it without
having to come to Congress and beg for so many billions of
dollars.
Mr. Rogers. Great. Thank you.
The Chairman now recognizes Mr. Davis from Illinois for any
questions he may have.
Mr. Davis. Thank you very much, Mr. Chairman.
Mr. Jackson, I notice in your testimony that you suggested
a prize for technology. One of the complaints that I have heard
from vendors, both large and small, is what they consider to be
a lack of direction and planning from TSA. There is no
indication of multi-year planning or strategy in its
procurement process. How would offering a prize really help,
and wouldn't it continue to hold TSA to being reactionary or
being a reactor as opposed the initiator?
Mr. Jackson. An excellent question. Let me see if I can try
to just explain in short compass.
This is not something that would cover every need or
objective at TSA, but for some major transformational
investments that need to happen, where you take not incremental
change but substantial change, what you are trying to do is go
from the existing model, which is basically to seed a variety
of different firms and hope they come out with a successful
machine or a successful technology. Instead, to reverse that a
little bit and say: Here is a very important outcome.
I give one example, which is, I believe, that it is
possible, I know that it is possible, with the right focus, to
get an AT machine to be able to detect liquid explosives in a
bag. TSA has gone through several years of conversations with
the vendor community about that. I believe if you made a very
simple objective of achieving that goal and then put some money
behind it, it would induce people to invest the time and energy
and focus to get there, whereas right now it is a very
uncertain outcome for the vendor community; if you invest in
this thing one day and another thing another day, whether you
are going to be on point for what TSA really most needs.
So that is just a way of trying to get the Government to
focus on the two or three things that are most transformational
for the Government, and then the private sector to chase it
with a sense of urgency and dispatch and innovation.
Mr. Davis. So are you saying that the vendors are more
reluctant to explore new or different approaches if they don't
have much indication of what the outcome might be in terms of
TSA deciding that what they have come up with is something that
it really wants to use?
Mr. Jackson. That is true. It relates to the other point I
had made in the testimony about the complexity and expense and
time delays associated with the certification process. So if
you could make that more transparent, more efficient, less
costly, then you can actually help bring these two ideas
together to allow TSA to focus their highest priorities in a
way that is very clear and to give the vendor community a
system that they can use to get it certified.
Mr. Davis. Thank you. That leads me to my next question,
actually. Mr. Lord, what would you say is the most effective
means for DHS to assess cost and benefits of new technologies?
Mr. Lord. In terms of cost, first of all, they already
produce life-cycle cost estimates at the component level. What
has been lacking in the past, as Ms. Duke alluded to, is the
need to validate these cost estimates. Have an independent
office outside of the component validate independently whether
these estimates are realistic. That is in terms of cost.
In terms of performance, again, it is an independent
oversight issue. I think it is always good to have a second set
of eyes review any estimates or summary of performance that are
delivered to senior management.
So, again, it is just an independent oversight function
that has recently been stood up. We think it is a good thing.
It has taken years to erect it. So we would obviously have some
concerns if that was changed significantly.
Mr. Davis. Thank you very much. My time is about to expire,
so I will just end there.
Mr. Rogers. I thank the gentleman.
Mr. Jackson, in your testimony, you discussed the
considerable backlog of inline checked baggage system
replacement projects. Even if Congress writes annual checks to
TSA to replace these technologies as they age, would we find
ourselves during this perpetually as the technologies need to
be replaced? In your opinion, is this a sustainable way of
doing business? Ms. Duke, I would like your comments on this as
well.
Mr. Jackson. I don't think it is sustainable under the
current procurement model because we need to address several
problems in this--how to get more capital into the field faster
and more efficiently. That is a big problem. Alternative
finance helped address that.
There is a question that I think has come up with several
of the Members' questions here this morning about the change
and the pace of change for managing the software that drives
detection in these big explosive detection systems both at the
checkpoint and downstairs with checked baggage. The issue is
that our opponents in the field are constantly innovating them
in the way they package and the types the recipes or formulas
they use for explosives. It is not just a simple inventory of
death tools that are out there and once you figure out how to
use those, you have got everything covered. It is a constantly
iterative cat-and-mouse game between the bad guys and the
Government to figure out how best to use your devices.
The Government puts the standard on the table when they buy
these things in good faith. As Mr. Lord says, the procurements
we did after 9/11, we took the state-of-the-art that we could
deliver and that the manufacturers could come to the table
with. But that state-of-the-art changes over time and it
produces a series of different software operating platforms
that have different capabilities different from one
manufacturer to the next and over time they get progressively
more complex and more efficient and more effective. But the
threat changes as well.
So what you are in is a game of exploring how to do this on
a continuous basis. That is why the suggestion that I make
about making the architecture of the software open and
transparent is so vital because what that would do is give TSA
the capability to take charge of its destiny in making rapid
and iterative changes in the software algorithms necessary to
make these machines work against the current threat level. That
way you get a better value for the long term for the very
substantial investment that you have paid for with the
machines.
The medical industry has made phenomenal progress in this
way. If you just think about what an iPhone did with apps, it
is the same thing, really. When you make an open architecture
for a device that is widely used and iteratively changes, you
now empower a whole community of smart people to come in and
help you work on those type of tools.
What you can do if you had that and you gave a little prize
money for success on specific things, these four things all
link together to say you have to stand back from where we have
been and really evaluate how to go forward and give TSA the
tools they need to succeed. Some of these things that I have
suggested TSA may be less favorable about, and others much more
favorable. Some in the industry may not like them as much and
others they may like very much. I am saying that the
responsibility of an independent analyst and the Congress is to
step back and say: How can we put together the right tools to
make it happen?
Mr. Rogers. Ms. Duke.
Ms. Duke. Mr. Chairman, when TSA stood up, its focus was on
Federalizing the airports in a short amount of time. I think
from the perspective of getting that, it was a huge success.
Two challenges that it resulted in that is something that we
have to deal with now are the reliance on technology, virtually
solely, and second are what I call chokepoints in both
passenger and baggage screening in the process.
So I think that as TSA moves forward, looking at the
layered risk-based approach to screening technology is an
improvement that could be made. We still have to rely on
technology. But how do we address the risk-based piece of it,
and the layer, including like the behavioral technology.
So I think that TSA, working with CBP, because that is
something they have done in the past, is a step in the right
direction. So you have your technology as a base, but then you
also have the layered approach that deals with these two
challenges. One is the overreliance on technology and the cost
of that, and the second are these movement of goods and people
chokepoints.
Mr. Rogers. Mr. Lord, your thoughts.
Mr. Lord. I agree with Ms. Duke, it is very important not
to lose sight of the impact on commerce. You are obviously
trying to balance commercial considerations--moving people
through airports with security needs. I always like to add
another consideration, and that is privacy. That has recently
been discussed extensively in Congress and in the press. So
within that triangle, you are trying to figure out where to put
your pin--privacy; security; and throughput, or commerce. So I
think that is a constant struggle.
In terms of the additional financing flexibility Mr.
Jackson has alluded to, I think that is a very interesting
concept. I haven't seen any proposals in writing, but I know
the TSA administrator, he has already been on record in
suggesting there could be some additional flexibility needed in
financing so many improvements being made at airports.
In terms of open software issue, I believe I would have to
think about that. There is obviously some National security
considerations involved here. We don't want our adversaries to
know exactly what our requirements are, what our machines are
looking for. Is there a way to make the process more
transparent in terms of testing? Probably if TSA was here to
probably mention this new testing facility they are coming up
with, hopefully that will address some of Mr. Jackson's
concerns stated today.
Mr. Rogers. Excellent. The Chairman now recognizes the
Ranking Member Ms. Jackson Lee from Texas.
Ms. Jackson Lee. Mr. Chairman, let me thank you for your
indulgence. I appreciate the opportunity to briefly give my
opening remarks and how the Chairman must proceed I would like
to raise a few questions if I might.
[The statement of Ranking Member Jackson Lee follows:]
Prepared Statement of Ranking Member Sheila Jackson Lee
September 22, 2011
TSA and the Science and Technology Directorate at DHS are tasked
with the critical mission of delivering technologies that can improve
transportation security. I cannot overstate the importance of this
mission.
Given the risks to our aviation and mass transit sectors, it is
imperative that we take a close look at how DHS integrates an effective
security technology approach into our transportation security programs.
Last Congress, this subcommittee took the first step in this
evaluation.
I held a hearing exploring the Department's effectiveness in
acquiring and deploying passenger screening technologies and
procedures.
Coordination between the Science and Technology Directorate and the
Transportation Security Administration is essential to ensuring that
the best technology is deployed in a systematic way.
We cannot address emerging threats with an ad hoc practice and a
lack of process.
To be clear, Mr. Chairman, the Department has come a long way since
its establishment but more must be done to ensure an effective research
and development program that leads to purchases in the real world.
However, because my colleagues on the other side of the aisle have
proposed to slash S&T's budget below the President's fiscal year 2012
request, I have little hope that S&T will be able to fulfill its
mission.
We ask the Department to improve efficiency, delivery, and
coordination efforts but we want them to do this with inadequate
funding.
Doing more with less is a good campaign slogan, but it does not
explain how we get the necessary research and development done.
It doesn't explain how we keep this Nation safe from emerging
threats.
Mr. Chairman, I know from my discussions with you, that we share
the same commitment to securing our Nation's transportation systems.
Ms. Jackson Lee. Let me thank the witness for their
presence here today and I acknowledge some other friends and
individuals we discussed in the past I am delighted with the
Chairman and our effort to be part of the securing of the
homeland and recognizing the importance of job opportunities
through new technology. I think this is a very instructive
hearing.
Mr. Chairman, I would encourage that we expand these
hearings and hear more about the emerging technology.
In particular, TSA and the science and technology
directorate at DHS are tasked with the critical mission of
delivering technologies that can improve transportation
security. I cannot overstate the importance of this mission,
given the risks to our aviation and mass transit sectors. It is
imperative that we take a close look at how DHS integrates an
effective security technology approach in our transportation
security programs.
If I might anecdotally say, had any of us heard of a shoe
bomb in 1995? But our terrorist community, if I might use that
with some tongue-in-cheek, are at the cutting edge of
technology. Had anyone heard on the Christmas day bomber of the
hiding or the placing of bomb materials in a strategic location
of which it was found? They are looking for new ways to do us
harm.
Last Congress, this subcommittee took the first step in
this evaluation. I held a hearing exploring the Department's
effectiveness and acquiring and deploying passenger screening
technologies and procedures. Coordination between the science
and technology directorate and the Transportation Security
Administration is essential to ensure that the best technology
is deployed in a systemic way.
We cannot address emerging threats with an ad hoc practice
and a lack of progress or a lack of process. To be clear, Mr.
Chairman, the Department has come a long way since its
establishment, but more must be done to ensure an effective
research and development program that leads to purchases in the
real world. However, because of my colleagues on the other side
of the aisle I am concerned about the slash in the S&T's budget
below the President's fiscal year 2012 request. I have some
concern that S&T will be able to fill its mission. Maybe the
Chairman and I can raise this question in a bipartisan manner.
I have always said we should not nickel-and-dime our security.
We ask the Department to improve efficiency, delivery, and
coordination efforts, and I expect that they will do so. But I
also think that they cannot function with inadequate funding.
Doing more with less is a good campaign slogan, but it does not
explain how we get the necessary research and development done.
It doesn't explain how to keep the Nation safe from emerging
threats.
Secretary Napolitano is reaching across the Nation on the
slogan and the effort of ``see something, say something.'' We
are calling upon Americans to rise to their higher angels and
to be part of securing the homeland. We must do our job and our
job is to ensure that the resources are there for the right
work to be done, to be able to approach and face the threats
that are constantly emerging.
Mr. Chairman, I know from my discussions with you that we
share the same commitment to secure our Nation's transportation
systems, and I look forward to doing so. I might add
anecdotally that I think the Chairman and I were speaking of
the new technology and canines, the kinds of canines, how they
are bred. That is a step that was not in focus or in play, if
you will, either before 9/11 or shortly thereafter. So I
believe that our technology is the key to the 21st Century and
I ask as I proceed with my questions that we continue on that
pathway.
Let me proceed with some questions. Ms. Duke, welcome. It
is good to see you. I know we went down this pathway again, but
it disturbs me that I would like to pose it again and that is
around the explosives trace portal known as puffers, costing us
$36 million. The reason why I use it is because it will be used
by others. I know that my Ranking Member of the full committee
also posed this question that it was removed from the airport
checkpoints in 6 months. I think I remember being puffed and
seeing how it worked. It was an attractive looking and I do not
say this with disrespect, but toy. It had those kinds of bells
and whistles. I can imagine it might have been that kind of an
attractive sight when someone made the determination.
So the question comes again: What is the level of expertise
that reviews new technology? What are the bells and whistles
that should go off? I would like Mr. Lord to comment, $36
million used against us at some point in time, it might have
had some value, but it didn't function in 6 months. Do we have
the right kind of expertise that are vetting these particular
new projects?
Ms. Duke. I think there are two aspects at the beginning
and end of the process: The first is setting the requirement to
meet the operational need most effectively. We talked about
that a little earlier. The second----
Ms. Jackson Lee. Did we do that in this instance or do we
have the kind of expertise? I doubt that----
Ms. Duke. I think the Department and TSA continues to build
it, but it is still a work in progress. I think at the other
end of cycle is test and evaluation. I mentioned earlier that
initially there was probably not enough testing in either area.
Then we started to improve the developmental testing which
deals with how can--do these machines meet the specifications.
Then near the end of my tenure, we started to, more
systematically, do more operational testing and that is the
full picture. Operational testing just doesn't meet the
specification, but does it operate for the intended purpose in
the intended environment? I think this is an area that is
building and will really help ensure the puffer scenario
doesn't happen in the future.
Ms. Jackson Lee. Just quickly, do you know how many staff
are involved in those layers, operational, developmental?
Ms. Duke. At the Department level there are few people in
S&T, standard and test and evaluation division. There should be
test and evaluation personnel in each of the major programs but
I don't know the numbers.
Ms. Jackson Lee. Can you get back to us with a number, it
would be helpful to me, if you would. Did you hear me?
Ms. Duke. Yes.
Ms. Jackson Lee. If you would say what your appointees----
Ms. Duke. I will work with the Department, since I am
retired now, I will work with the Department to get access to
that information.
Ms. Jackson Lee. I appreciate that. Mr. Lord, do you want
to comment on how we found ourselves in that manner? Do you
have the expertise in house?
Mr. Lord. I think this whole puffer episode underscores the
importance of conducting rigorous testing and evaluation. I
would just like to amplify. I agree with Ms. Duke's assessment.
I would like to clarify, there are two types of test and
evaluation. There is qualification test and evaluation, that is
where you test against the requirements in a controlled
laboratory setting. I think that was done. But I think where
the shortfall occurred is operational test and evaluation. That
is where you test in a real-world setting. What they found with
the puffers is when there is dirt in the air, high humidity,
temperature variations, that it did not perform like it did in
the carefully controlled laboratory settings. So again, the
lesson learned is you need to test it in real-world conditions.
That should be part of your testing scenario. They have changed
their processes now. That is a requirement for the new
technology. So hopefully, these types of incidents will be
avoided in the future.
Ms. Jackson Lee. Do we have the in-house expertise? Do we
have scientists at the level----
Mr. Lord. We not only have more procurement experts,
acquisition experts, independent cost estimators. There are
more people concerned with testing and evaluation. Again, as I
stated earlier, you need to have that function outside of the
component level, you need to have an independent function and
they stood that up. So it is--I mean, they have been
strengthening the process over the years. It has taken
probably--it has taken a long time, but they do have the
enhanced processes and testing capabilities now, which is a
good thing.
Ms. Jackson Lee. Let me quickly ask--thank you very much,
Mr. Lord. If I can put on the record that I would like to get
the numbers of the staff and the levels of positions that they
hold. So Mr. Chairman, I am not sure Mr. Lord will be able to
help us, Ms. Duke is retired, and I do appreciate that.
Let me just pose this question: There is not a moment that
we are home in our districts that the American people whose tax
dollars we are entrusted to who are in business ask us about
this complicated process of doing business with the Federal
Government. I have encouraged the President to talk more about
buy America from the perspective of the Federal Government that
every effort is made to buy America. I think if we buy paper
clips from a small business in the United States, we have just
built capacity beyond our expectation.
What steps do you recommend for TSA in order to issue and
award contracts quickly, at the same time, ensuring competition
and the proper use of TSA funds in the technology area? What
can we do? Forgive me if someone has asked that.
Ms. Duke. I think that one of the key steps is
communicating with industry early and openly and that goes back
to before the requirements are set, not just a day once the
requests for proposals was issued, but work with industry early
on about what is state-of-the-art, what is the art of the
possible and what are the cost and schedule tradeoffs for going
to the cutting edge technology, versus commercially available
and the stages in between. So I think that is very important. I
also think it allows industry to bid more effectively if they
know what to anticipate and plan for.
I think setting clear requirements is No. 1. I know I have
worked that into every hearing that I have ever testified in,
but that is important. Industry has to make a decision whether
to propose on a contract. Without a good requirement it really
is kind of--it really is taking on undue business risk.
A third part, I think, is educating the businesses,
especially the small businesses and how to do business with the
Government, programs such as the Small Business Innovative
Research Program need to continue so that small businesses have
the opportunity to enter the Federal market in a prime contract
function, not just as a subcontractor.
Ms. Jackson Lee. Let's probe that because we have had long
discussions. I know when you were in the Government you were
out on the road. We are still hearing from small minority and
women-owned businesses. How do we get the mind-set to be more
energetic on really aggressively looking at small businesses
may make their application or they are fishing around to really
create the atmosphere they could thrive and secure a contract?
Is there some pearl of wisdom or some action you took that you
not just offered to us in testimony right now? Some anecdotal
story that might give us some understanding how to get small
businesses involved.
Ms. Duke. Well, I think really the key is for the small
businesses decoding the process, there are a lot of acronyms
and stuff that seem complicated. I think education is the key.
I think the recent change to allow set-asides for women-
owned business is a step in the right direction for that. I
encourage women-owned businesses to get certified just like
there is certification under the 8(a) program, because that
allows you to compete against your peers, just other small
women-owned businesses as other small 8(a)s, that is huge,
because it is more of a level playing field than you competing
against a large business. Both the Department and Small
Business Administration has to really continue that education
process.
The other point if it is a pearl of wisdom, I would say is
think small; it is always hard to get that first contract, just
like it is hard to get that first job when you are out of
college. So when I am coaching small businesses, I say really
look for that opportunity where you can garner your reputation
and get that past performance in Federal Government. I think
that is important.
Ms. Jackson Lee. Let me just--Mr. Chairman, I am concluding
in just a moment. Let me make this point on the record, Mr.
Chairman, which I hope we can find a way, maybe the committee
could join in sort of an on-the-Hill summit about this small
business issue because it impacts all of our constituents. I
want the Federal Government to put small contracts forward. It
is difficult to get procurement officer to think of the value
of the those small contracts, maybe you can have greater
encouragement, if we could, to be able to do that.
Mr. Jackson, from your business perspective, a comment on
doing business with the Federal Government, particularly on the
technology lines.
Mr. Jackson. Well, I think that TSA has made huge progress
in trying to figure out structures and mechanisms to work with
businesses large and small. So they are in the process of
growing, they have made substantial changes and progress and
there is more to do. So there is always more to do. So I think
that TSA could do more in reaching out to businesses in a
systemic way.
I agree with what Elaine has said for the process. I would
also add it is equally important once a business has gotten an
award for a service or technology, it is particularly important
to give sustained feedback and input to the company about how
they are performing. That is frequently an area that is easy to
ignore or forget. So if you are producing a piece of technology
and it gets out into the field and it is not doing certain
things that the users would like or it is doing them
particularly well, those are things that need constant
feedback. It has to start with the beginning of an idea of a
need and continue all the way through the operational life.
Ms. Jackson Lee. If I might interrupt you, do you know the
functional coordination officers and capabilities requirement
council that DHS is proposing? Does that ring a bell?
Mr. Jackson. I do not, ma'am.
Ms. Duke. Ms. Duke knows about it. Why does the Federal
Government have--Chairman, do you know about the functional
coordination offices and capabilities and requirement council?
Mr. Rogers. First time I have heard it.
Ms. Jackson Lee. Ms. Duke, will you tell us that be worth--
Mr. Jackson, I didn't mean to interrupt you. I just thought you
may be aware of it.
Ms. Duke. Mr. Lord may want to comment, but that is part of
DHS's answer to the GAO integrated high-risk plan. What that
seeks to do is define commonality in capabilities and mission
requirements across DHS and eventually buy more effectively. So
if TSA, CVP Coast Guard have a similar mission requirement, how
can you rationalize the requirements and then buy them more
effectively?
Ms. Jackson Lee. Is it proposed, or is it in place yet?
Ms. Duke. It is part of the report that went to GAO and
they are in the process of putting it together. I believe Mr.
Lord could verify that.
Mr. Lord. That is correct.
Ms. Jackson Lee. Thank you. I will finish with this
question Ms. Duke. Thank you, Mr. Lord, and I do not take issue
with the language as long as I understand it, but it is pretty
long title here. I noted that it is to become more efficient
with the buying process when there is overlap.
Let me just ask this question, Ms. Duke. In your testimony,
you emphasize a need for an appropriate acquisition workforce
in your review or your knowledge of the proposed House budget,
which I will just say cuts quite a bit. Does the proposed House
budget impact DHS's effort to ensure accountability and a
acquisition workforce adequate to stimulate economic growth and
innovative solutions in Homeland Security technologies?
Ms. Duke. I have not looked at the current proposed budget,
but I can say this: One is that the acquisition workforce has
to stay in proportion to the program dollars. So if the cut in
the acquisition workforce is more than the program dollars,
that is going to be to the detriment of the spending of the
money. It will make it harder for the acquisition workforce to
get the requirement out there and get under contract to allow
job growth and industry. I learned in industry, that oftentimes
they have a percentage so that as they look at program or
direct dollars, they anticipate a percentage increase and the
need for people like acquisition workforce, human resources,
and I think that is important in ensuring that the taxpayers
dollars are spent.
Ms. Jackson Lee. Thank you very much for your indulgence,
Mr. Chairman. To the witnesses, let me thank you very much for
what I think is a major component to securing the homeland, but
at the same time, the Department of Homeland Security gives a
very, very important opportunity for the genius of America, the
new inventors, the new technology that can both secure us, but
generate the next level of inventiveness and jobs. With that,
Mr. Chairman, I thank you for this hearing and I yield back.
Mr. Rogers. I thank the gentlelady.
Mr. Lord, in your opinion, is it fair to say that in the
procurement process TSA over the last 10 years, we have largely
been reacting to the last terrorist attempt rather than looking
forward to new technologies and new threats?
Mr. Lord. That is--hmm. I would have to say in terms of
their requirement-setting process, they are trying to
anticipate new threats. That is why in January of this year
they broadened and deepened, I can't give any specifics, it is
sensitive information, but they have made an attempt to keep
abreast of latest developments. You know, it is Government
bureaucracy, sometimes it probably takes a little longer than
you would anticipate, but they are making an attempt. In
terms----
Mr. Rogers. Do they have formal practice, exercises is what
I am getting at. When I played football a long, long time ago,
we would have what we call skull sessions, that was all about
brainstorming. I am wondering does TSA have formal meetings or
functions where they just sit around and think in cooperation
with the private sector, what are our threats? How can we deal
with them? Are you aware of anything like that, any exercises?
Mr. Lord. They set up this process with S&T, it is called
integrated product team IPT capstone process where they try to
harmonize and discuss what are the threats and requirements,
what are the detection issues we should be aware of. I know
they made at least some effort. Also, they do reach out, Ms.
Duke mentioned the industry days, they conduct classified
briefings. They have discussions with industry: Is it enough? I
don't know how you would measure that, but they do have
mechanisms in place. What we found in our prior work is vendor
still considered an issue, it is difficult to evaluate, because
the vendors, you are not sure what the basis of the complaint
is, but they have been very vocal with us. I think it is
something TSA needs to continue to work on. Obviously they are
trying, but could further efforts be made? Absolutely.
Mr. Rogers. Mr. Jackson, your thoughts?
Mr. Jackson. I think TSA absolutely does look in the rear-
view mirror, and they must do that, because once you have a
known threat, you have no excuse not to try to cover that
threat in an effective way. My experience in the Government
showed that we spent however a substantial amount of time, a
really focused effort to try to anticipate changes in this. So
the TSA administrator begins his or her day with an
intelligence briefing from the intelligence community that
sucks up all this sort of information about current plots,
techniques, tools, devices, modes of attack, and it has home at
DHS headquarters, intelligence shop, it has an intelligence
shop home at TSA. This is how you begin your day if you were in
a job like my old one, I would start 7:00 a.m. with those type
of briefings.
Then each of the operating components, most all the
operating components have real field work, CDP, Coast Guard,
TSA, Secret Service have that focus. Then there is a systemic
search for what you can do to make a cost-effective investment
for a dollar to try to cover the known threats and the unknown
threats. For example, when Kip Hawley became TSA administrator,
we had a very sustained and focused conversation around how can
I spend a certain amount of money and achieve the maximum extra
benefit for detection. I had some of these conversations with
you at the time. We thought getting more dogs and behavior
recognition into the field as fast as we could in a disciplined
way, were the two most efficient ways to take on a bunch of
unknown problems, but which fell into that categories that we
knew we could work through with those tools. So my experience
is you have to do both, TSA does both. It is a hard job to try
to crystal ball the means of attack in the future. It can
always be improved, that process can always be improved, I
assume, but they work at it.
Mr. Rogers. Ms. Duke, your thoughts.
Ms. Duke. One of the recommendations I would have is that
one difference between Department of Defense and Department of
Homeland Security is the budgeting and programming process.
Even though both have an annual budget. Within Homeland
Security it tends really, even though you submit a 5-year
budget, it is really nearly 100 percent annual. Where in
Defense even though most of their appropriations are annual
also there is really a 5-year plan. They really look at the 5-
year budget. I think that TSA has to look back, as Mr. Jackson
said, and also, has to look forward.
But really, looking at the 5-year budget as a plan, subject
to the annual adjustments that are necessary, but really
looking at that comprehensively, because the years do feed on
each other, I think would help TSA look more perspectively and
plan better. I think it would also help industry because then
they can anticipate if there is a reasonable assurance that
they can predict the out years, I think it would help them use
some of their--as you know every industry partner major has the
IRAD funds, internal research and development. It would help
them use that more effectively if they knew what they could
reasonably anticipate in the budget out years.
Mr. Rogers. Excellent. Mr. Lord, you had something you
wanted to say?
Mr. Lord. Yes, I wanted to add one thing to my prior
remarks. On the Department-wide basis, the Department has an
office of risk management and analysis, they go through the
scenario testing, what, looking at different scenarios, how the
terrorists could hit us next. It is really interesting, they
literally model hundreds of scenarios. They try to get at the
unknown unknowns, as former Secretary of Defense Rumsfeld once
labeled it, the so-called Black Swan, what should we be worried
about that we can't even vision. Sort of futuristic, I think
that office does good work and that is an important part of
their program.
Mr. Rogers. I am glad you offered that. The Chairman now
will recognize Mr. Richmond, if he has any questions.
Mr. Richmond. I will just ask one and it is to Mr. Lord. I
know GAO has done extensive work on TSA and looking at their
workforce. I guess my specific question would be looking at the
high turnover and attrition there, and its impacts on fewer
training opportunities, especially based on the fact the
checkpoints are understaffed and workers are not allowed to
take time off for training. What type of impact does that have
on the training on the deployment of checkpoint technology?
Mr. Lord. Um, all due respect, sir, we never looked at that
question specifically. What we did look at was turnover at the
higher level, the SES level. We found that turnover typically
goes up after a new administrator comes on board and levels
out. Over time, it had gone down. It wasn't out of line with
the rest of the Department, so I can't answer that specifically
as relates to the transportation security officers, but the
only work we have done was at a much higher level on that.
Mr. Richmond. Thank you. I yield back.
Mr. Rogers. I thank the gentlemen. I thank the witnesses.
This has been very helpful. This hearing is the first in a
series of three. We wanted to get folks who could to have kind
of a rearview mirror perspective and get their thought from the
20/20, ``you are out of the Government looking back in''
perspective. Our next panel hearing will be with private sector
folks who have had struggles in working with the Department,
what they think we can do to improve the procurement process.
Then we will have a third and final hearing where we have DHS
folks come in who are doing it now. They will have the benefit
of your testimony and comments here today as well as the
private sector folks, and hopefully well get something
productive out of it. I do appreciate all of you. I want to
remind the witnesses that there may be some additional
questions from Members who couldn't be here. So we will hold it
open for 10 days, if you could respond to those, I would
appreciate it. Again this is very helpful. Thank you for being
here, this hearing is adjourned.
[Whereupon, at 11:25 a.m., the subcommittee was adjourned.]
TSA REFORM: EXPLORING INNOVATIONS IN TECHNOLOGY PROCUREMENT TO
STIMULATE JOB GROWTH, PART II
----------
Thursday, October 13, 2011
U.S. House of Representatives,
Subcommittee on Transportation Security,
Committee on Homeland Security,
Washington, DC.
The subcommittee met, pursuant to call, at 2:15 p.m., in
Room 311, Cannon House Office Building, Hon. Mike Rogers
[Chairman of the subcommittee] presiding.
Present: Representatives Rogers, Jackson Lee, and Richmond.
Mr. Rogers. The Homeland Security Subcommittee on
Transportation will come to order. The subcommittee is meeting
today to continue to examine innovative solutions to technology
procurement at TSA that could generate cost savings for the
Federal Government and stimulate job growth within the private
sector.
I want to thank our witnesses for being here. I know it is
a consuming effort, but I appreciate them making the time to
participate in what I believe is going to be a very timely
hearing. We look forward to your thoughts on how TSA can
continue to improve its working relationship with the private
sector.
Our job on this subcommittee is to ensure that TSA has the
resources and capabilities needed to secure commerce and the
traveling public. Through that oversight, we have a great
opportunity to examine the ways to solve some of our Nation's
other challenges, the most pressing of which right now is high
unemployment. This subcommittee held the first installment of
this series of hearings just a few weeks ago. In that hearing
we heard from former DHS officials and the GAO on ways in which
TSA can do a better job communicating with the private sector
and ways TSA and DHS might reform their procurement processes.
Some of the ideas we heard included things like providing
the private sector with a much better roadmap so they can work
to meet TSA's needs in a less reactionary sort of way than what
we are seeing now.
It is clear that we need to look at ways to streamline and
reform acquisitions mechanisms within TSA and the Department
more broadly. Chairman King's authorization bill, of which I am
an original cosponsor, gets at some of these reforms in matters
like strategic sourcing and enhanced requirement settings.
I can't overemphasize the need for well-thought-out
requirements. Both the Science and Technology Directorate and
the operational components of TSA must be part of the process.
The Capabilities and Requirements Council that DHS is standing
up once again, after having disbanded it, should go a long way
toward that end.
We have heard recommendations of a third-party
certification for alternative financing for strategic sourcing
and for revising the clearance process. I am pleased to see
these ideas in the dialogue that these hearings generated
around the issue. We must examine all options for finding new
opportunities to engage industry.
What I would like to hear from all of you are viable
options for changing how things are done at TSA that will build
innovative capacity in your world. You know better than anybody
what you need to promote progress in your challenging but
critical fields and create job opportunities.
I want to do all I can to foster that innovation of which I
know the private sector is incredibly capable, so I look
forward to hearing your thoughts on finding cost efficiencies
and creating jobs through improved technology procurement at
TSA. I encourage you all to return next month when we invite
the Department to testify on that same issue.
With that, I yield to my Ranking Member, my good friend
from Texas, Ms. Jackson Lee, for any opening statement she may
have.
Ms. Jackson Lee. I think this series of hearings are both
important and relevant in light of the fact of our full
understanding that security is holistic, and it requires a
seamless interaction between the S&T of the Department of
Homeland Security and the importance of the private sector.
I have interest of the private sector's collaboration. I
don't have interest in the private sector's dominance. But I do
think it is important that S&T becomes more focused, that it is
not a hobby shop, that it is intertwined with the framework of
our present conditions. I always say this. I think the Chairman
has heard me say this, that terrorism is becoming franchised.
We use the term ``lone wolf.'' I prefer using ``individual
actor'' and we don't know who that actor may be.
So it is not a laughing matter or a matter that draws
humor, but it requires a sense of balance and a sense of
understanding that all the principals are important in the
effort of securing the homeland.
So as I indicated I know from our discussions that the
Chairman and myself share the same commitment to securing our
Nation's transportation system. Understand that today's hearing
is the second hearing in this series, and I look forward to
receiving testimony from today's witnesses and hope that the
third hearing, which will contain Government witnesses, will
provide insight on the practices of this administration.
Today we will hear from members of the business community.
I want to first welcome Mr. Guy Ben-Ari, deputy director of the
Defense-Industrial Initiatives Group at the Center for
Strategic and International Studies. It is an important think
tank, and I thank you for being here today.
At the September hearing, we heard from former Homeland
Security officials. They testified about the need for greater
cooperation between business and Government in developing
contract requirements for major research projects. The 9/11
Commission was a very, very thorough review, I believe, in the
immediacy of the tragedy. But they produced a readable
document. All of these elements are part of preparedness, part
of putting on our armor, and it is imperative that we continue
going to the next generation of technology that gets us more
than one step ahead of the terrorists but many steps ahead of
the terrorists.
While this is an interesting thought, as you know, the
Federal Acquisition Regulations have strict rules about the
depth and breadth of permissible discussions between Government
and industry prior to the announcement of a contracting
opportunity.
I think the last hearing also made it clear that this
administration has given some thought and taken some action on
how TSA and S&T can improve their collaboration. We can put in
a framework where the security issues are answered and the
dialogue can continue.
We in Congress need to support and encourage efforts to
assure that Government is more efficient and generally meets
the needs of its customers and the American taxpayer.
Unfortunately, the current budgetary atmosphere makes a strong
and robust research and development agenda unlikely, though I
would like to push the envelope to say that we should not
nickel-and-dime the Nation's security.
TSA and the Science and Technology Director at DHS are
tasked with the critical mission of developing, evaluating, and
delivering technologies to improve transportation security.
Their job is to increase public safety. Given the risk to our
aviation and mass transit sectors, DHS must be able to
integrate effective security technology into our transportation
security programs. However, new solutions, old problems, seldom
come without cost.
Mr. Chairman, at this point we must ask: What costs are we
willing to pay? We should not be afraid to spend dollars if we
save lives.
Let me put in an additional note. Some of the greatest
research comes from start-ups and small businesses. I don't
want to see the intricate and difficult procurement process
that is tied to S&T and the Department of Homeland Security
keep away those genius ideas that may be the next level of
securing the homeland. I hope the witnesses will comment on the
need for that kind of view in order to keep with the next
generation of technology.
I will just make one point. Every time there was a
terrorist act post-9/11, from the anthrax to the shoe bomber to
the underwear bomber, unfortunately these were low-tech, but
everybody in the United States I would imagine had never heard
of it. Low-tech, never heard of it. What is next? We have got
to be ahead of that kind of action. So we should not be afraid
to spend dollars however because my colleagues on the other
side of the aisle have from the leadership decided to slash the
Department's budget below fiscal year 2012. I am not hopeful of
moving forward.
So I am hoping to convince a few of my colleagues that
research and development under the S&T is extremely important.
I hope this testimony will help the Chairman work with me on
that idea and that premise, and that we can ensure that we do
not stop the collaboration between the private sector, the
effectively secured collaboration between the private sector.
With that, Mr. Chairman, might I just offer, as I indicated
to you that I have a duplicate or an overlapping hearing of
which I am offering amendments to legislation. If the witnesses
perceive that I am departing, I am hoping to return to this
very important hearing, and I have asked the Chairman for his
indulgence, and he has been kind enough to indulge me.
Thank you very much, Mr. Chairman, I yield back.
Mr. Rogers. I thank the gentlelady.
I am tickled to have such a fine panel here. I appreciate
all of you.
We have Mark Pearl who has served as the president and CEO
of Security and Defense Business Council since March 2008.
Prior to joining the Council, Mr. Pearl was principal and
chairman of IT Policy Solutions, which he founded to counsel
private sector organizations in meeting their public policy
challenges. He concurrently served as executive director of the
Consumer Electronics Retailers Association. Mr. Pearl had
previously been a partner in the international law firm of Shaw
Pittman and led their e-commerce policy practice; served as
general counsel and senior vice president to the ITAA, now Take
America, and was chief of staff and legislative counsel to U.S.
Representative Dan Glickman when the former chairman chaired
the House Intelligence Committee.
We also have Scott Boylan, who is vice president and
general counsel of Morpho Trust USA, where he overseas legal
and Governmental relations functions. Mr. Boylan joined Morpho
in April 2005 where he served as vice president of Government
Relations and general counsel. Prior to joining Morpho
Detection, Mr. Boylan was senior advisor to the Secretary of
Homeland Security and part of the team that established DHS.
Immediately prior to his time at DHS, Mr. Boylan served at the
Treasury Department and the Department of Justice in
international law enforcement roles. We are pleased to have Mr.
Boylan here and appreciate his testimony before the committee
on numerous occasions.
We also have Guy Ben-Ari, deputy director and fellow of the
Defense Industrial Initiatives Group at the Center for
Strategic and International Studies, where he studies the links
among innovation industry, military capabilities, and defense
policy. Prior to joining the CSIS, Mr. Ben-Ari was research
associate at George Washington University, Center for
International Science and Technology Policy, where he worked on
National research and development policies and network-centric
capabilities.
From 2000 to 2002 he managed collaborative research and
development programs for Gilat Satellite Networks Limited, an
Israeli high-tech company in the field of satellite and
communications, and from 1995 to 2000 he was technology analyst
for the Israeli Government. He also consulted for European
Commission and the World Bank in innovation policy and project
evaluation.
We are thrilled to have all of you here and look forward to
your opening statements before we go into questions.
Mr. Pearl, we will start with you.
STATEMENT OF MARC A. PEARL, PRESIDENT AND CEO, HOMELAND
SECURITY AND DEFENSE BUSINESS COUNCIL
Mr. Pearl. Mr. Chairman, thank you for giving the Homeland
Security and Defense Business Council an opportunity to testify
before you today to discuss the important issues involving
technology procurement at the TSA, particularly related to
innovation and job growth in the private sector. The Council,
as you well know, serves as the collective voice of the
Nation's leading homeland security solution providers whose
major goal is to facilitate transparent, substantive dialogue
between industry and Government on critical homeland security
issues.
Our written testimony focuses on providing the subcommittee
with industry's perspective on how TSA in particular, and the
Department of Homeland Security as a whole, can work more
effectively with the private sector to improve technology
acquisition and procurement process, as well as stimulate job
growth.
While my written testimony goes into obviously much more
issues and more detail, I would like to use my time to
highlight a few issues that we raise.
Everyone understands that the full acquisition life-cycle
process is very complex and requires effective and efficient
strategies, processes, and procedures. It requires strong
organization, capable of determining if what is needed
technologically is technologically feasible and economically
reasonable, with strong understanding of any unintended
consequences. Those are three important questions that have to
go into the whole life-cycle process.
The DHS Acquisition Management Directive, 102-01, updated
in January of last year, provides a foundation of policies and
procedures to support acquisition management at the agency. The
issue, however, is whether the programs that result from these
policies actually operate and function as intended and in a
manner that is transparent to all parties.
Government and industry share the same goal: To provide for
the technology and capabilities needed by TSA for mission
success through processes that are transparent, accountable,
coordinated, timely, cost-effective, and policies that
encourage competition, innovation, and investment in the
homeland security marketplace.
No one, particularly in these tough economic times, wants
to see nor can afford to have their time, money, and resources
wasted. Reform alone, however, at TSA will not solve the
current challenges with technology acquisition. A truly
successful processing system will require that component parts
of DHS stop operating in silos and become more harmonized.
While much progress has been made since its creation, DHS
across all platforms, within all of its components, must work
to achieve the development of a common operating picture that
facilitates communication, collaboration, coordination, and
cooperation in a triangulated fashion between and among
operations; in this case, at TSA, R&D, and the procurement
process.
Here are a few ways in which we belive that shared goal can
be achieved:
First, develop a long-term acquisition strategy along with
adequate and predictable funding. Particularly given the
current economic environment, companies cannot waste time and
money on speculative technologies that they believe TSA might
want to incorporate into security in the transportation arena.
Industry needs greater insights and predictability into TSA's
long-range acquisition and procurement plans. The information
the private sector currently receives comes much too late in
the process and is not detailed enough to enable it to redirect
R&D investments to align with TSA's goals.
Second, develop procedures that encourage and allow an
early and on-going dialogue with industry. DHS and TSA must
facilitate early substantive engagement with the private sector
in an open and transparent manner, long before an RFP or an RFI
is initiated, that will encourage industry input to help define
and calibrate technological requirements to match objective and
achieve mission goals. The more complex the procurement, the
more critical the need is for an open information exchange.
Such conversations between and among the interested parties
sufficiently in advance of any specific procurement would not
be tied to an upcoming project or program or contract, but
would enable the Government to gather the information needed to
help shape the desired outcome and define requirements long
before a contract is initiated.
Third, technology testing requirements should be
standardized. Technology testing and certification requirements
need to be more transparent, realistic, consistent, and not
cloaked in mystery. The process should rely on a clearly-
defined series of lab, field, and operational tests under an
open schedule to encourage technology companies to invest in
new research, with more assurance that its investment will
receive vetting and possible acquisition by TSA.
In conclusion, let me say: A harmonized acquisition process
within DHS that encourages and utilizes early engagement and
on-going communication with industry will drive innovation and
investment towards technologies needed for mission success.
This process does not pick winners. Rather, it provides a
foundation for competition at the very high level. The Council
believes the actions I have outlined here as well as in my
written testimony will go a long way to ensuring that TSA will
be able to acquire the most effective and cost-efficient
technology.
On behalf of the Council, I appreciate the opportunity to
provide this collective perspective of industry on these
important issues before the subcommittee.
I will answer any questions that you deem fit to ask.
[The statement of Mr. Pearl follows:]
Prepared Statement of Marc A. Pearl
October 13, 2011
Chairman Rogers, Ranking Member Lee, and distinguished Members of
the subcommittee, I thank you for giving the Homeland Security &
Defense Business Council an opportunity to appear before you today to
discuss the important issues involved with technology procurement at
the Transportation Security Administration (TSA), particularly as they
relate to innovation and job growth in the private sector.
I am Marc Pearl, President and CEO of the Council, a non-partisan,
non-profit organization of the leading homeland security solution
providers. The purpose of the Council is to facilitate two-way
substantive dialogue between the private sector and Government on
critical homeland security issues and to ensure that the private
sector's perspectives, innovation, expertise, and capabilities are
integrated into our Nation's security.
Collectively, our members employ more than 3 million Americans in
all 50 States and provide expertise in technology development and
integration, facility and networks design and construction, human
capital, financial management, and program management. In particular,
many of our member companies specialize in the technologies and
services needed and used by TSA.
The Council's testimony today will focus on providing the
subcommittee with industry's perspective on how TSA, in particular, and
the Department of Homeland Security (DHS), as a whole, can work more
effectively with the private sector to improve the technology
acquisition and procurement process and stimulate job growth. As
recognized in the September 2011 Government Accountability Office
Report on ``DHS and TSA Acquisition and Development of New
Technologies,'' TSA acquisition programs represent billions of dollars
in life-cycle costs and support a wide range of aviation security
missions and investments including technologies used to screen
passengers, checked baggage, and air cargo. These technologies make up
a significant part of TSA's annual budget and play a critical role in
its ability to accomplish its mission.
The full acquisition life-cycle process is quite complex and
requires effective and efficient strategies, processes, and procedures,
and a strong organization capable of determining if what is needed is
technologically feasible, economically reasonable, and will not result
in unintended consequences. The life-cycle process begins with
identifying a capability need; analyzing and selecting the means to
provide that capability; obtaining the capability through the
appropriate types of acquisitions; and producing, deploying, and
supporting the capability through its useful life until disposal. If
any infrastructure component is deficient, the entire process is at
risk for failure.
The DHS Acquisition Management Directive 102-01, updated in January
2010, provides the overall policy and procedures to support acquisition
management at the agency. While it offers a strong indication that
acquisition management processes are in various stages of development,
it is critical that the programs resulting from these policies actually
operate and function as intended and in a manner that is transparent to
all parties.
Government and industry share the same goal: To achieve the
capabilities needed by TSA for mission success through processes that
are transparent, accountable, coordinated, timely, cost-effective, and
policies that encourage competition, innovation, and investment in the
homeland security marketplace. No one, particularly in tough economic
times, wants to see, nor can afford, to have time, money, and resources
wasted.
Reform solely at TSA, however, will not solve the current
challenges with technology acquisition. A truly successful process and
system will require that component parts of DHS stop operating in
silos. DHS--across all of its platforms, within all of its components--
must work to achieve the development of a common operating picture that
facilitates communication, collaboration, coordination, and cooperation
in a triangulated fashion between and among operations at TSA, the
research and development (R&D) process, and the procurement process. To
achieve the shared goal, the Council strongly recommends the
development of the following:
(1) A long-term acquisition strategy, multi-year budgets and
deployment plans, and adequate and predictable funding;
(2) Open, transparent, and coordinated processes, practices, and
procedures that facilitate early and on-going dialogue with the
private sector and well-defined technology performance and
testing requirements; and
(3) A strong organization that can coordinate both the R&D and
procurement processes and has a workforce capable of planning
and executing that process.
If the entire acquisition process is harmonized (and perhaps even
``standardized'') within DHS, and includes earlier and continuous
engagement and communication with industry throughout the process, we
can drive innovation and investment towards the technologies needed for
mission success. This process does not pick winners; rather, it
provides a foundation for competition at the very highest level. The
Council believes these actions will go a long way in ensuring that TSA
(as well as other components within DHS) can acquire the best, most
effective, and cost-efficient technologies (as well as services and
products).
1.development of a mid- to long-term strategic acquisition plan, multi-
year budgets, and adequate and predictable funding
The private sector serves an important role in developing, testing,
and providing the technologies that TSA needs to operationalize its
mission. Industry, however, does not have limitless resources to devote
to technology development in a void. Particularly in the current
economic environment, the private sector cannot waste time and money on
building speculative technologies that they believe TSA ``might'' want
to incorporate into aviation security. Industry wants to develop and
deliver the technologies that TSA needs now and long into the future.
To accomplish this, the homeland security industry must have greater
insight and predictability into TSA's long-range acquisition and
procurement plans. It currently only receives high-level, near-term
technology plans in the form of an annual Congressional budget
justification. This information comes too late and is not detailed
enough to enable industry to redirect R&D investments to align with
TSA's goals. Development and testing typically requires several years
before a security technology is ready for implementation and
deployment.
The Council strongly believes that TSA must strive to develop a
mid- to long-term strategic acquisition plan and consider the
possibility of multi-year budget plans. A strategic acquisition plan
would provide all interested companies with an insightful blueprint for
Government's future needs, and give them the necessary time to align
and focus financial and personnel resources towards addressing the
highest-priority needs. While no doubt difficult to do under the
current budget approval process, Congress and the Department could work
together more closely to develop multi-year budget plans, or at least a
credible forecast of future budget activities at the time of an annual
budget justification. This would provide all interested parties,
including and particularly industry, with a level of certainty needed
to make multi-million dollar technology investments and hiring
decisions.
TSA could also improve transparency in the acquisition planning
process by sharing, through appropriate channels, the relevant
findings, from the Transportation Sector Security Risk Assessment.
Sharing long-term technology acquisition and deployment plans,
including a prioritized, risk-based, multi-year list of required
capabilities and intended deployment plans would help industry provide
more timely and cost-effective solutions. New technology development is
hindered when industry is uncertain as to whether DHS will undertake
testing, much less purchase newer, higher-performing systems.
In conjunction with budget forecasts, it is also critical that TSA
have confidence that it will receive adequate funding to address
evolving threats. Enhanced budget planning and communication of budget
requirements will result in taxpayer savings and increase industry's
ability to understand whether business risk justifies future job
creation. Any and all assistance that Congress can provide in guiding
the development of a mid- to long-term strategic acquisition plan,
multi-year budget plans, or ensuring adequate funding for TSA would go
a long way in providing the foundation for all interested parties to
achieve mission success.
2. development of open, transparent, and coordinated processes,
practices, and procedures that facilitate well-defined technology and
testing requirements
A. Engaging the Private Sector Long Before the Procurement Process
Begins Will Result in Well-Defined Technology Performance
Requirements and Better Results
The private sector wants to develop and provide the capabilities
that TSA (and the entire Department) needs to achieve mission success.
To accomplish this, it is incumbent upon Government to provide industry
with well-defined technology and testing requirements. If the technical
performance needs and testing requirements for technologies are not
clear to industry, it increases the potential for an increased or lost
cost of development, longer time before deployment, duplication of
effort, and a resulting product or technology that fails to meet TSA's
expectations and operational needs. Well-defined requirements also help
motivate industry and are critical to promoting competition.
Defining mission needs in a clear and concise fashion is not a job
that Government can or should do alone. DHS and TSA must develop
coordinated processes, procedures, policies, and practices that
facilitate early, substantive engagement with the private sector in an
open, transparent, and predictable manner long before a Request for
Proposal (RFP) is initiated. Industry input is essential to help define
and calibrate technical requirements to match mission objectives and
achieve mission goals. The more complex the procurement, the more
critical the need for an open information exchange. Transparency in
this process is also necessary to ensure that no one feels that a
particular technology is being highlighted or unfairly selected. If all
participants understand and adhere to ``rules of engagement,'' that are
both predictable and consistent, we can optimize the input and exchange
between Government and industry.
The members of the Council strongly support DHS engaging the
private sector by conducting more conversations or discussions
surrounding general needs and conceptual frameworks that are NOT tied
to any upcoming or projected program or contract. Whether called
``Industry Days'' or something else, such interactions between and
among the interested parties sufficiently in advance of any specific
procurement will enable Government to gather the information needed to
help shape the desired outcome, define requirements, identify what is
economically reasonable and technologically feasible, and allow all
interested parties to explore any unintended consequences before a
contract is initiated.
Contracting professionals in Government often have a limited
understanding of what industry is (or may not be) capable of providing,
and limited exposure with the skills, business practices, and
experiences of potentially valuable companies. By engaging with the
private sector long before the procurement process begins, DHS
personnel, for example, can conduct more effective market research and
gain a greater understanding of existing and emerging technologies,
including Commercial Off The Shelf (COTS) products, which may offer
significant opportunities for reduced development time, faster
insertion of new technology, lower life-cycle costs, and an overall
substantial cost savings to Government. This type of engagement with
industry would allow Government to understand the business practices
supported by the commercial item, learn the appropriate industry
terminology and concepts associated with the desired service or
equipment, identify potential contractors that provide the item, and
determine the correct scope of the requirements that best fit the
existing vendor base.
The Council has been in on-going discussions over the past year
with representatives from the Science and Technology (S&T) and the
Management Directorates to begin to address some of these needs and
issues to further the goal of transparency and how best to achieve
mission success. We have raised the idea, for example, of creating a
Government-industry advisory council that could coordinate an open
dialogue on specific topics that could bring about a greater
understanding between the two sectors, such as having industry days
earlier in the process. A jointly-led advisory council could conduct
work sessions to share perspectives on the timing, manner, and
substance of communications, and the best ways to conduct industry days
so that both sectors receive mutual benefit. We are currently exploring
options for how to facilitate such an important and potentially
effective activity.
Industry is also encouraged to see the Government issuing more
Requests for Information (RFIs) on the FedBizOpps website, and hopes
this trend continues in the future. This is another manner for the
Government to conduct market research to identify what kind of products
or service solutions are commercially available. It asks industry to
offer solutions for agency requirements or objectives; and facilitates
the collection of information about companies with the appropriate
capabilities, products, experience, and expertise. Through this
interactive tool, Government and industry can have a continuous two-way
dialogue that results in requirements that are greatly improved from
when the RFI was first issued.
We must stress that the exchange of information with industry
cannot stop at the issuance of a RFP, it must continue throughout the
entire procurement process, particularly when information previously
provided has changed. DHS should continue to use and further develop
acquisition websites that provide information for specific identified
procurements, definitions of terminology and milestones, and regular
updates to time schedules, future needs, and other previously provided
information.
B. Standardize Technology Testing Requirements and Speed Up the Process
for Certification by Using a Clearly-Defined Series of Lab,
Field, and Operational Tests That Can Be Provided by Third
Parties
The process by which DHS tests technology is not standardized. TSA
uses a series of lab, operational, and field tests to validate some
equipment but not all equipment. Other components, like Customs and
Border Protection, rely on a single demonstration test every 5 years to
evaluate inspection equipment. The lack of consistency and continuity
creates a great deal of unpredictability and inefficiency, which can
cause delays in deploying the most up-to-date, qualified technology in
a cost-effective manner.
DHS must do more to communicate with industry to ensure that
technology testing and certification requirements are realistic,
consistent, and not cloaked in mystery. It must develop a process that
relies on a clearly-defined series of lab, field, and operational tests
on a rolling schedule to allow for the testing and validation of new
technologies. An open schedule will encourage technology companies to
invest in new research with more assurance that its investment will
receive vetting and possible acquisition by DHS.
The current process for testing and certifying new technologies is
often confusing, cumbersome, and can result in wasted time, money, and
resources. DHS needs to provide industry with greater transparency into
the process and should also consider alternative arrangements, such as
paying a third party to test and certify the technologies based on
standards established by the Government. This is something that has
been successfully done in the United Kingdom. The use of National labs,
non-profits, or for-profit corporations for this process could greatly
speed up the deployment of technology to TSA.
3. development of a strong organization that has a coordinated
acquisition process and a workforce capable of planning and executing
the process
A. Development of a Coordinated Acquisition Process That Links
Operations, R&D Efforts, and the Procurement Process
DHS needs a stronger, more coordinated acquisition process that
moves away from the current stove-piped environment and can harmonize
and link operational considerations with R&D efforts and procurements.
While much progress has been made since its creation, DHS still has
more work to do in ensuring collaboration, coordination, and
communication across the agency.
The Council believes that it is critical to implement an
acquisition process that facilitates effective engagement between and
among DHS' components and with the private sector. There are at least
11 unique procurement and R&D processes occurring across the agency.
Large components run their own processes in different ways and many
times inconsistently. This can result in duplicative efforts.
Current R&D efforts are spread not only among different component
organizations within DHS but also across Federal agencies. The S&T
Directorate is highly dependent on other Federal agencies to achieve
its mission. There does not appear to be a clear strategy for how to do
it effectively and in collaboration with the Department of Defense, the
Department of Energy, NIST, and other scientific organizations. This
lack of collaboration may result in duplicative efforts and unleveraged
technologies. To increase the likelihood of success, Congress should
determine whether the S&T Directorate needs greater authority to
perhaps direct the Government-wide R&D agenda, rather than having to
compete against numerous organizations inside and outside of DHS.
With more communication within and among Federal agencies, DHS has
the opportunity to effectively link efforts and identify potential
technologies that it could leverage in support of other missions. The
development of a standardized and coordinated DHS-wide acquisition
process and the use of the same communication tools would not only
enhance efficiency, but would provide needed transparency so that end-
users, acquisition and operations officials, and industry can work
together. If we can improve coordination of these programs and
processes throughout the Department, it will contribute to a strong
organization and we will get better results with procurements at TSA.
B. Ensure a Workforce Capable of Planning and Executing the Acquisition
Process by Increasing the Quantity and Quality of Public Sector
Contracting Personnel
We urge Congress to recognize and help address the shortage of
acquisition and procurement staff across the Department. DHS needs the
ability to increase the number of procurement officers with expertise
in technology, engineering, and management to accomplish the complex
operational aspects of oversight and review. Contracting officers must
be accessible, interactive, and open to sharing concerns and approaches
for various aspects of a particular procurement. They must also value
and understand input and substantive dialogue with the private sector
both pre- and post-award. Such an exchange is particularly valuable at
a time when procurements have become more complex. To accomplish these
goals, Congress should support programs that further the development,
training, and retention of acquisition professionals. This could be
accomplished, in part, by ensuring continued funding for the
acquisition ``intern'' program.
The Council has also long advocated, for example, that DHS develop
an exchange program with the private sector to improve the management
abilities and the technical and professional competencies of its
employees. A professional exchange program would offer DHS direct
insight into the philosophy, procedures, and practices of industry. It
would provide public sector professionals with an opportunity to
examine industry policies and processes, as well as learn first-hand
how industry addresses both R&D and contracting and procurement issues.
This would allow DHS to interpret the needs of the Department in
industry terms. By studying the best practices of the industry,
Government professionals are able to bring new knowledge,
understanding, and empathy back into the Department to improve its
processes. The process would also benefit industry, which would gain a
better understanding of the unique perspective and experience of the
DHS professional. Obtaining such direct insight and experience is
currently unavailable in DHS. There are a few programs that bring
private sector experts into Government, but none, as far as we know,
that encourage or permit public sector employees to be temporarily
detailed into the private sector to gain the knowledge and/or
perspective that would help them better understand the multiple factors
that go into the relationships between R&D, procurements, and
operations.
conclusion
As I stated in my introduction, we all share the same goal: To
achieve the most successful outcome for all stakeholders through a
process that is transparent, accountable, predictable, timely, cost-
effective, and that encourages competition, innovation, and investment
in the homeland security marketplace. Today's acquisition process and
specifically the procurement process need to be more flexible,
inclusive, and dynamic to change. The Council and its members have
worked closely and successfully to nurture a substantive relationship
with the Management and S&T Directorates in particular to discuss how
we can best develop a dialogue that identifies a successful process
that could lead to even more effective and efficient innovative
solutions to protect our country. But even amidst the establishment of
these relationships, the business sector, as a whole continues to
struggle to comprehend the long-term strategic needs and goals of TSA.
This has made our long-term investments toward new and innovative
technologies that might become effective solutions, challenging at
best.
We respectfully ask Congress and this vital and interested
subcommittee to consider the following recommendations, provide
guidance and continued oversight, and help facilitate the dialogue
necessary between industry and Government to improve the process and
outcome for all stakeholders:
(1) Development of a long-term acquisition strategy, multi-year
budget plans, and predictable and adequate funding for TSA;
(2) Development of open, transparent, and coordinated processes,
practices, and procedures that facilitate well-defined
technology and testing requirements; and
(3) Development of a strong organization with a standardized and
coordinated acquisition process and a workforce capable of
planning and executing the process.
While TSA in particular and the Department as a whole are still
evolving, this is not about ``reinventing the wheel,'' but rather
identifying and encouraging the many best practices and lessons learned
available from other Federal agencies that have decades of experience
with acquisitions.
On behalf of the Homeland Security & Defense Business Council, I
appreciate the opportunity to provide the collective perspectives of
industry on the important issues before the subcommittee. The Council
is willing to provide or facilitate any support, expertise, and input
you need to ensure that we can all work together to achieve mission
success.
Mr. Rogers. Mr. Boylan, you are recognized.
STATEMENT OF SCOTT BOYLAN, VICE PRESIDENT AND GENERAL COUNSEL,
SAFRAN MORPHO DETECTION
Mr. Boylan. Morpho has three companies that supply to TSA:
Morpho Trust, which I am an employee of; Morpho Detection,
which is a leading provider of explosive detection to TSA; and
Morpho Track, which is a leading provider of automated
fingerprint systems that the FBI uses and they are used in
various applications at TSA as well.
We are also a leader in identity technologies that are used
in the TWIC program and a number of other programs. So TSA is a
very important customer of ours.
Just a footnote. Morpho, a commonality that crossed our
businesses is algorithms, algorithms that enable us to make
decisions in the security context. Morpho is a type of
algorithms mathematics and that is why we have that name. I
heard that question in your voice, Mr. Chairman.
I have three points to make.
One, the first is engagement. I echo Mr. Pearl's comments.
Pre-engagement with industry, discussing the possibilities and
the limitations and the fundamentals of what technology can and
cannot do, is very important for TSA and especially for TSA
policymakers. When I was at the Department, I have to say we
were a bit remiss in understanding these capabilities. I think
not just the technology people, but also the policymakers need
to know not at a micro level, but at a certain baseline, what
technology can and cannot do. That enables you to make good
policy decisions.
Constructing a way to engage with TSA, industry and TSA, is
something I think is necessary because in my experience with
folks at TSA, they want to engage, they want to talk, they do
talk. But they also have a certain hesitation because it is not
really clear what bright-line engagement rules are for them. I
think clarifying that for the employees could go a long way to
making that interaction more fruitful.
Second is phased implementation of technology as opposed to
here is what we want the technology to do, a long laundry list,
and trying to deploy that. What happens is you have years of
experimentation before you get a deployment, as opposed to
deploying the basics and improving from that baseline.
We have a very clear example of this from the very
beginning of TSA. We have been providing TSA explosive
detection equipment that scans bags since the creation of TSA,
and the initial deployment of that technology met a baseline
that wouldn't get certified today. Many of those machines that
were deployed at the beginning, I have to say Reagan Airport is
one of them, you can see our machines there, they are the early
version, those machines have the capabilities that are required
today because they have been updated in place.
So there is the capability of deploying machines, deploying
technologies at a baseline, and raising that if you plan for
it. That system, it was planned for. So I recommend that that
is something that TSA look into for most of their deployments.
Finally, a recommendation in the international field and
international standards. In the European Union, for example,
E.U. Commission passed a regulation that was to go into effect
next year that basically required the adoption of the American-
style system of screening baggages by deployment computer
tomography, CT machines that we use here in the United States
at level one as the first instance of screening. Industry
airports in the European Union have pushed back on that because
of the expense, and it has been pushed out to 2014.
TSA has largely been uninvolved, not engaged in this
discussion. That is an area where we could really have a big
impact on jobs and the economy, because right now the CT
industry, all of the certified equipment around the world, is
made here in the United States. That is an opportunity that we
have for our economy here to grow vis-a-vis TSA.
Thank you for your time. I am happy to answer any
questions.
[The statement of Mr. Boylan follows:]
Prepared Statement of Scott Boylan
October 13, 2011
Chairman Rogers, Ranking Member Jackson Lee, and Members of the
subcommittee: Thank you for holding today's hearing on TSA procurement
and how TSA's technology procurement can stimulate economic growth. My
name is Scott Boylan and I am Vice President and General Counsel of
MorphoTrust USA Inc., a subsidiary of the Safran Group, the largest
biometrics company in the world. I was most recently the Vice President
and General Counsel of Morpho Detection, Inc. (``MDI''), the second of
three Morpho security companies that provide security technologies
related to detection and/or identification to TSA, the Department of
Homeland Security (``DHS'') and U.S. Government more broadly.
MorphTrust has more than 1,000 employees in the United States and
is headquartered in Massachusetts. We offer a comprehensive set of
products and solutions for protecting and securing personal identities
and assets--leveraging the industry's most advanced multi-modal
biometric platform for finger, face, and iris recognition, document
authentication, secure driver's licenses and identification cards, and
passports. MorphoTrust is a global leader in providing Secure Identity
Management solutions across Government and commercial markets.
MDI has more than 560 U.S.-based employees with factories in
California and Massachusetts. We are a leading supplier of explosives
and narcotics detection technology world-wide. Our technologies support
Government, military, transportation, first responder, critical
infrastructure, and other high-risk organizations. We integrate
computed tomography (CT), Raman Spectroscopy, trace (ITMS technology),
X-ray and X-ray Diffraction (XRD) technologies into solutions that
deliver detection results quickly with a high degree of accuracy, while
ensuring efficient security operations. MDI has been a supplier to TSA
since its creation.
MorphoTrak has more than 541 employees in the United States with
major facilities in New York, California, and Washington State. We
provide biometric and identity management solutions to a broad array of
markets in the United States including law enforcement, border control,
identity cards, civil identification, and facility/IT security. We are
a leading innovator in large fingerprint. MorphoTrak has provided
biometric identification solutions in the United States for over 35
years and provides State-wide biometric identification systems in 28
States plus the District of Columbia. Our products are used by more
than 300 city, county, and State government agencies across the United
States.
industry government partnership: advisory committees
A continuous challenge doing business with TSA is the lack of
visibility into its future acquisition plans. The Chairman has
recognized that this is a challenge for industry and has encouraged TSA
in previous hearings to be more open and communicative with private-
sector partners. We believe that a formal mechanism, such as an
advisory panel consisting of industry and technology stakeholders,
would be an excellent vehicle for exchanging information for both
industry and TSA. TSA should set goals for industry and work with
industry to create high, interoperable standards.
Having visibility into future TSA procurement plans gives key
guidance to industry in making employment, manufacturing, and inventory
decisions. TSA would also benefit by reduced costs associated with its
technology suppliers being able to more efficiently purchase inputs for
their products with better planning and more efficient procurement of
parts. Transparency will also allow for stabilization of manufacturing
operations and avoid employment disruptions that many in the industry
have seen.
The Morpho companies spend millions on research and development of
security technologies. This effort can be more efficiently targeted
when TSA's future plans, strategy, and vision are known. For example, a
Morpho company recently was awarded a TSA contract for traveler
document authentication. We were willing to dedicate significant
resources and investments to develop this technology for TSA, without a
guaranteed return, because when TSA issued requirements we then knew
what TSA wanted. This is the scenario we need to recreate going
forward. We believe that this will become the standard practice as TSA
continues to improve and invest in its procurement system.
phased acquisitions
TSA should use phased acquisitions when moving into new and
developing technology areas. Initial procurements should focus on basic
requirements and follow-up procurements should push for increased
performance and options. An example of this is EDS standards that
started with a high threshold and have continually gotten more
difficult to achieve in subsequent procurements. This has allowed for
the initial broad deployment of baggage screening equipment immediately
after
9/11 and contributed to a constant improvement in detection
capabilities up to today.
advocating for stronger international aviation security
standards=higher u.s. jobs and security
TSA is in a unique position to influence the security standards
used around the globe. Our company provides security technology around
the world, much of which is made in the United States and shipped
overseas. We see in numerous international procurement solicitations
that the standard required by airports and governments around the world
is the TSA technology standard--especially explosive detection
standards. TSA or E.U. certification is often required before a
manufacturer can bid on a contract. We have seen this in many countries
with emerging security standards that do not have the resources to
conduct their own testing.
We have also witnessed TSA's reluctance to strongly advocate for
their superior standards in international markets. A key example is the
European Union where the Commission has adopted standards for checked
baggage screening that would require in the future deployment of
computed tomography machines at the first level of screening. This is
effectively the system used by TSA in the United States today. The E.U.
standards currently permit X-ray technology to scan checked bags, but
TSA and the European Union have both recognized that X-ray technology
has challenges screening for certain threats that CT technology does
not. Despite the regulation change and the recognition of a security
concern, there has been strong resistance to deploying CT technology at
level one in Europe by European stakeholders who would have to invest
in the technology. TSA has largely stayed out of this debate. But this
is where they have the opportunity to both increase the level of
explosive detection capability in a region that is a key to U.S.
aviation security and open a potentially huge market to what is
predominately a U.S. industry. Adoption of CT at level one in the
European Union would create a market for CT in Europe that would be
larger than in the United States. All of the currently certified CT
technology in the world is manufactured in the United States.
Once this standard becomes a U.S. and E.U. standard it will likely
become a de facto global standard that increases aviation security
around the globe--and jobs and economic activity in the United States.
Thank you.
I will be happy to answer any of your questions.
Mr. Rogers. Thank you.
Mr. Ben-Ari, you are recognized.
STATEMENT OF GUY BEN-ARI, DEPUTY DIRECTOR, DEFENSE-INDUSTRIAL
INITIATIVES GROUP FELLOW, INTERNATIONAL SECURITY PROGRAM,
CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES
Mr. Ben-Ari. Thank you, Mr. Chairman. Thank you for the
opportunity to come before the subcommittee on this important
issue.
I would like to provide a few overall DHS trends based on a
report that was recently published. We use publicly available
data to look at contract spending at the Federal level for
various departments and agencies, and the data I will be
presenting is from a recent report on Department of Homeland
Security with a little of the more drilled-down into the TSA
data.
Overall, the numbers for DHS are pretty steady in terms of
contract spending. In the period we looked at from 2004 to
2010, contract spending stood at about $13 billion to $14
billion a year, every year. This is a good thing for internal
planning and budgeting purposes. DHS internally knows that it
has a steady stream of contract dollars that it can then award
to the private sector. The private sector has a clear signal
from the DHS customer that there is a steady contracting dollar
amount that it can plan against.
About 70 percent of contract spending by DHS is spent on
service contracts. The rest almost entirely is spent on
products as we will talk about in a minute, relatively small
portion spent on R&D contracts, research and development
contracts. In fact, research and development contract spending
fell from around $700 million spent in 2004 to about $400
million spent last fiscal year, fiscal year 2010. Those $400
million amounted to about 3 percent of total DHS contract
spending that year.
Our report also looks at--sorry. One more word on research
and development before I move on, because I think this is an
important topic for this subcommittee and this hearing.
About one-third of DHS contract spending on research and
development is actually spent on research and development
management and support contracts. So it is important to make
that distinction because these are contracts that do not buy
for the Department of Homeland Security actual research and
development. They are instead supporting facilities,
laboratories, test equipment and so forth, and when counting
overall R&D dollars, it skews the data a little bit if you
include that, what in DHS is a significant amount is R&D
spending.
In terms of how DHS has competed its contracts and how well
the industrial base has responded to that competition, a large
majority--about 75 percent of DHS contracts are awarded
competitively--are competed. About half of them receive more
than multiple offers from the industry side.
The way that the Department of Homeland Security has spread
out those contracts to industry has also been relatively spread
out in terms of the distribution to small, medium, and large
companies. In DHS, large companies receive about 40 percent of
the contract with small- and medium-sized companies receiving
about 30 percent each. This, compared to other Government
departments is a very, very diversified spread of the contract
dollars.
Specifically for TSA, we ran similar data, and for the most
part the trends for overall DHS contract spending are reflected
in TSA's contract spending. That is to say, there is a
relatively steady amount year over year at about $2 billion
dollars a year. About three-quarters of that goes on services,
and about $500 million goes on products. A much smaller share
in TSA goes to R&D, and that is down significantly, from around
$380 million in 2004 to almost $6 million in 2010. Even there,
of those $6 million, about one-third is R&D management and
support of contracts I referred to earlier.
In terms of competition and the industrial base, the
picture is slightly different for TSA than from DHS overall.
Only about half of the contracts that TSA awards are competed
and receive multiple offers. The share of those contracts that
goes to the large companies in the industrial base is much
larger as well. In 2004 it was 56 percent, with about 21-23
percent awarded to small- and medium-sized companies
respectively.
Just two quick points. I know I am short on time.
Two quick points in conclusion. The first is that our
report, as most of our other reports, in this case was not
intended to answer specific questions or address a specific
trouble or issue. It was purely data-driven. We felt there was
a lack of good data on the Department and on its components,
and our aim here was to put forward that data, and we are happy
to cut this data any other way as is necessary for the
betterment of the analysis and the planning that goes on in DHS
and in Congress.
The second comment is that specifically on R&D again, the
importance of making that distinction between R&D overall and
then the components of research and development, specifically
that component of management and support research and
development contracts which do not directly contribute to the
R&D effort.
Thank you very much. I look forward to your questions.
[The statement of Mr. Ben-Ari follows:]
Prepared Statement of Guy Ben-Ari
October 13, 2011
Chairman Rogers, Ranking Member Jackson Lee, and Members of the
subcommittee, I appreciate the opportunity to appear before you this
afternoon as part of this distinguished panel to offer my views on
contracting trends in the Department of Homeland Security and the
Transportation Security Administration. I would note that my statement
draws on research undertaken at the Center for Strategic and
International Studies (CSIS) but that the statements and conclusions
are my own and do not necessarily represent the views of CSIS.
The Defense Industrial Initiatives Group (DIIG) at CSIS recently
undertook a study on contracting trends in the Department of Homeland
Security (DHS) between 2004 and 2010. Although DHS was enacted by law
in 2002 and created as a separate entity in 2003, our analysis begins
with the year 2004 as it was the first full fiscal year of DHS
operations. We used the Federal Procurement Data System (FPDS) as our
primary source of data. All dollar amounts in the report and in this
testimony are obligated dollars as reported in FPDS and are in 2010
constant dollars.
In this testimony I plan to first provide an overall view of DHS
contract spending on products, services, and research and development
(R&D), then present data for the Transportation Security Administration
(TSA), and conclude with final comments.
overall dhs contracting
DHS has kept its overall contract spending levels steady at around
$13-$14 billion per year since 2005 (with the exception of Katrina
response in 2006). Responses to unexpected events such as natural
disasters and attempted terrorist attacks have largely been funded by
other outlays, including personnel accounts and grants to State and
local governments.
This stability in contract spending enables DHS managers to conduct
long-term planning and programming with the knowledge that, barring
unexpected developments, they can accurately predict the funding levels
in future years. A steady budget over several years also sends a clear
signal to industry that, overall, there is stability and continuity in
DHS spending that is contracted to the private sector. However, the
fact that there has been no growth in contract spending also means that
there is currently very little cushion in this category as the
Department moves into a period of budget cuts and greater fiscal
austerity.
The majority of DHS contracts--60 percent to 75 percent each year--
are awarded for services. Within services, the majority of contract
dollars--worth $27 billion for the period 2004 to 2010--were spent on
professional, administrative, and management services (PAMS). The
second- and third-largest service categories, by value, were facility-
related services (including construction) and information and
communication technologies (ICT), at $16 and $14 billion, respectively.
Total DHS spending on services for the years 2004-2010 increased by 85
percent, much more than it did for products. Between 2007 and 2010,
annual spending on services stabilized at around $10 billion.
dhs spending on r&d
DHS spending on R&D contracts dropped, from $675 million in 2004
(when it was 8 percent of contract spending) to some $400 million in
2010 (when it was 3 percent of contract spending). In comparison, the
Department of Defense in 2010 spent 11 percent of its contract dollars
on R&D (not including classified R&D, which, if included, would
significantly raise the R&D share). Note that as per the norm in all
CSIS/DIIG research, R&D management and support contracts, though
classified as R&D contracts in FPDS, are counted as service contracts
and not R&D contracts.
This leads me to an important point on DHS R&D contract spending.
From 2004 to 2010, a total of $4.4 billion was spent on actual R&D
contracts and $1.7 billion was spent on R&D ``management and support''
contracts, i.e. contracts for the operation and maintenance of research
laboratories and equipment. In other words, almost 30 percent of DHS
dollars spent on R&D contracts between 2004 and 2010 was not spent
actual R&D and should be excluded from R&D data for the purpose of
assessing R&D funding.
competition and contractor base
In 2010, nearly half of DHS contracts were openly competed and
received multiple offers, up from 38 percent in 2004. In parallel,
contracts that were not competed have been on the decline at a rate of
18 percent per year, on average, to a share of 13 percent of total
contract dollars.
DHS has been spreading its contracts to a wider contractor base. In
2010, the top 20 DHS contractors accounted for 34 percent of total
contract spending, compared to 43 percent in 2005. DHS contracts with a
significant number of commercial companies (primarily in the IT domain)
in addition to the traditional defense and security contractors.
DHS has been consistently contracting with small and medium-sized
companies. In the past 3 years, about 40 percent of contract dollars
have gone to large companies (those with annual revenue of $3 billion
or more), 30 percent have gone to medium-sized companies, and 30
percent have gone to small companies. By comparison, the Department of
Defense in 2010 spent 56 percent of its contract dollars on large
companies, 30 percent on medium-sized companies, and 18 percent on
small companies.
tsa
Contract spending levels at TSA have been relatively steady from
2004-2010, with about $2 billion spent each year. Of that amount, some
$500 million are spent each year on product contracts (baggage
screening technology, advanced imaging technology, etc.), some $1.5
billion are spent on service contracts (screeners, maintenance of
products procured, etc.).
R&D contract spending at TSA dropped dramatically, from $381
million in 2004 to $3.8 million in 2010. This drop is in part explained
by a reclassification earlier this year of some $170 million from R&D
management and support contracts to services contracts. In addition,
TSA spent $1.8 million in 2010 on R&D management and support services,
32 percent of its total R&D contract spending.
Some 55 percent of TSA contracts were competed and received
multiple offers, a share similar to that of DHS as a whole. The share
of uncompeted contracts dropped from 38 percent in 2004 to 33 percent
in 2010 yet remains higher than the DHS-wide share of 18 percent
uncompeted.
Regarding the industrial base supporting TSA, 56 percent ($1.1
billion) of TSA's contract dollars were awarded to large companies, 21
percent ($410 million) were contracted to small companies, and 23
percent ($450 million) went to medium-sized companies. Furthermore, the
top 20 TSA contractors in 2010 accounted for 42 percent of contract
dollars obligated, compared to 45 percent in 2004. Of the top 20 in
2004, 14 remained on the list in 2010.
conclusion
Mr. Chairman and Congresswoman Jackson Lee, distinguished Members
of the subcommittee, I would like to close with two comments.
First, our research on DHS contract trends was not intended to
answer a specific question or address a particular problem. Rather, it
was intended to present the facts as they arise from publicly available
data. Given that, we found that DHS contract spending was overall
stable over time, with a majority of contracts openly competed and
awarded across a broad industrial base that includes companies of
varying competencies and size. TSA exhibited similar trends in budget
stability and share of competed contracts, but has been awarding
contracts to a less diverse industrial base.
Second, our findings raise several important questions that the
data are unable to answer. With regard to R&D, the issue of how we can
measure the outcomes of actual R&D contract spending deserves greater
attention. A first step would be to separate R&D management and support
services from actual R&D contracts. More importantly, measuring any
kind of R&D spending is an input metric that says nothing about R&D
productivity and innovation, which are the issues we are really
interested in. For a better understanding of these issues, new analysis
is needed that assesses TSA's success in delivering new capabilities to
better undertake its missions.
With that, I conclude my remarks and look forward to your
questions.
Mr. Rogers. Thank you.
I will start off with the questions.
I was struck by that number when you said it dropped to $6
million. To what do you attribute that?
Mr. Ben-Ari. So there are two factors in play here. The
first one is that as other sectors in the Department of
Homeland Security grew, namely service and products, something
had to give. That something in the past 7 years was research
and development. The numbers are down for--Department-wide,
they are particularly starved in TSA's case.
The second reason is that in recent years, there has been a
reclassification of the contract dollars awarded away from the
research and development classification towards professional
services classification.
So it is not that less work was undertaken. In some of the
cases, it was just undertaken under a different type of
contract classification.
Mr. Rogers. Mr. Boylan, you made reference to the concern
that some folks in DHS have with talking with the private
sector. To your knowledge, there are no policies that guide
them as to the extent to which they can interact with the
private sector without getting in trouble?
Mr. Boylan. It depends on the context. Within the
contracting context, absolutely. Under the FAR, there are clear
guidelines, from my perspective.
What I was talking about is the pre-acquisition process,
the understanding of the possibilities and the limitations of
the possibilities. In that context, we have not had very good
conversations as of late. At the policy level is what I am
talking about. At the technology level, we have these
questions. But I think it is important for policy people and
people who are deciding policy to understand what technology
can do and cannot do.
Mr. Rogers. So you would like to see the Department
establish some guidelines so that format could be established?
Mr. Boylan. I know there has been a recommendation to
creating an advisory board that would have that type of
capability.
Mr. Rogers. Does the DOD do that now? Do they have that
kind of format set up?
Mr. Boylan. Yes.
Mr. Rogers. That has been one of my goals is to see the
Department emulate more of what DOD does, because they have
been around so long and they have kind of stepped on all of the
rakes and they know what not to do. But we are seeing DHS has
not been pursuing that course of action. Because I do want to
see what you are talking about. I want to see an on-going
dialogue about the challenges that the Department is facing
with the private sector, to see what is possible, and do it
very early before you start developing the RFPs. To my
knowledge, none of that--and I hear regularly about how
frustrated the private sector is about trying to just talk with
somebody.
But Mr. Pearl, what would be the thing that you would most
want to see them do as far as new guidelines? Is it that early
dialogue?
Mr. Pearl. Mr. Chairman, we have begun a process with some
of the folks below the kind of HQ level, with some of the Under
Secretaries. The Council is facilitating dialogue, for example,
with the Under Secretary of S&T, with Dr. O'Toole. We have
begun a dialogue with the Under Secretary of Management, Rafael
Borris, the idea being in his team, the idea being is that the
management component part over which the Under Secretary is
responsible for, he does have on-going oversight authority to
even rein in some of the procurement issues, and I think there
are like 10 or 11 different procurement acquisition kind of
different silos going on, but he does have a certain amount of
oversight.
However Dr. O'Toole has not been given those kinds of tools
and does not have that oversight. So if the administrator of
TSA or the administrator of any of CBP or any of the component
parts, wishes to do their own R&D, they can do it without any
semblance of necessarily communication. So we have been working
with them on how we can have those dialogues.
They call them industry days. The fact is that that
language basically says, we have developed an RFI and RFP, we
know what the contract is going to be, and we will call in
industry and we will basically read you the Federal Register
report. What our discussions have been, and we have gotten a
little bit further than we have in the past, because it all
depends on general counsel accepting it, it all depends on
ethics, those kinds of things, that if we can have those
discussions in conceptual framework, along the lines of what
Mr. Boylan and I were discussing, long before, to figure out--
because nobody, whether it is in the public sector or in the
private sector, can expend R&D resources anymore for what we
think TSA in this case might want. That is part of the
discussion.
We have begun to move that ball, that needle, a little bit,
and we are trying to get through the clearance. One of the
things is the possibility of forming an industry-Government
council outside of the normal kind of structure that would be
kind of co-chaired by public sector and private sector,
facilitated by organizations like the Council and other
organizations that would be part of it so that we can get all
of the players and interested players around the table.
Mr. Rogers. You may not know the answer, but does the DOD
have some process--you mentioned a while ago that they have
these preliminary discussions. What do they call it? It is not
industry days. How do they format it?
Mr. Boylan. They have industry days that are interactive.
What the criticism of DHS has been quite recently is that they
come in and read and they don't discuss with the people that
attend. It is a different atmosphere at DOD.
Mr. Pearl. I don't think that this is something that should
be either DOD- or DHS-model component. In many respects, DHS is
a law enforcement agency in some respects, not a kind of
National security agency. I think that the CIO who came in from
the IRS has certain plans in terms of technology, and I think
that Mr. Squires has been trying to push that kind of model.
So I think that the lessons learned interagency, not just
looking at the DOD model, but looking at how things across the
board, whether it is in Veterans or Education or Interior, how
does the process and how does the discussion about acquiring
technologies in this case--what do you go through? There should
be lessons learned both up-side and down-side, and those would
go to the three questions I stated.
Is it even economically reasonable in this environment, is
it technologically feasible? We don't want things that can't be
done. What are the unintended consequences? Those are the three
things that we think should be asked across the board all the
time.
Mr. Rogers. We have passed the subcommittee mark on the TSA
reauthorizatioin. We are about to bring it to full committee
next month. Is there something in the authorization bill that
would be necessary or helpful, in your view, on this matter
that you would like to see us include at full committee mark?
That is for any one of you.
Mr. Pearl. Just briefly, I would like to see the Congress
take a more encouraging supportive role. It doesn't always have
to be the passage of law that says this is the law that you
have to follow. I think that the nature of--and certainly our
written testimony went to that--that Congress has an important
role to encourage this kind of dialogue; to encourage exactly
what the two of us have been saying, to come out of an
authorization, not out of an appropriations approach; to come
out of authorization that says we give a sense of acceptance
and support for that kind of approach. That would help
everybody and all of the parties get in the room, and I think
if they heard that kind of bully-pulpit statement from the
Congress, that should be part of it. We have submitted
suggestions for that kind of approach to the staff director and
to the folks on the Committee.
Mr. Rogers. Mr. Boylan.
Mr. Boylan. I agree. We didn't coordinate our testimony
before this, Mr. Chairman. I think providing that guidance and
high-level cover, to the career-level employees especially,
that will give them comfort in engaging with us and together
hopefully we can achieve some good things.
Mr. Ben-Ari. Just one point. I completely agree on this
topic of Government-industry coordination dialogue. I would
just like to emphasize the point that internal dialogue
discussions are not less important, and there are efficiencies
to be gained. From a better dialogue across the various DHS
components, especially when it comes to research and
development, especially when it comes to acquisition, there are
enterprise-wide or mission-wide elements that cut across
programs and components. If those programs and components came
together to put together a common requirement, common standard,
and a common acquisition program, I think there are
efficiencies there for the Department.
Mr. Rogers. In response to one of the things I think that
Mr. Boylan brought up. We did have a full committee mark this
morning on the authorization. There was an accepted amendment
by Mr. Duncan to DHS that requires future-year investments. It
provides that the private sector--it will provide the private
sector with budget projections so you will see some investment
predictabiltiy going forward, which I think will be helpful.
Mr. Richmond is recognized for any questions he may have.
Mr. Richmond. To start with, when you talked about the
industry days, and just from someone who is not familiar with
how industry gets their ideas and new technology over to the
right people in DHS or TSA, walk me through a company who
either did their own research or came up with their own
technology. How do you get an audience with TSA or DHS to
inform them of that technology if you don't have technology
showcases and things like that?
Mr. Boylan. I guess I am the company guy, so I get to
answer that.
I have seen varying approaches. One thing that our
technology department does is they will write an unsolicited
white paper: Basically, here are some capabilities we have come
across; are you interested? Sometimes that begins a dialogue.
Sometimes it is a discussion around a current technology
that is being procured by TSA where we have seen improvements
of various sorts, or capabilities that could be added or
developed into that technology, and you can have those
discussions as well.
Industry days, like I said, one of the criticisms is that
usually it is TSA laying out a PowerPoint of what they want and
what they expect. Then what has happened in the past is then
industry comes in and often, unfortunately, this comes in
through a bid protest that your requirement has a problem of a
number of sorts. I can think of a few procurements that have
been dragged out for multiple years because of this. If you
would have had the engagement at the beginning, a lot of that
could have been avoided.
Mr. Richmond. To that solution, you recommend an advisory
council, is that one of your ideas to navigate through that?
Mr. Boylan. One of our suggestions is to have an advisory
council where these types of discussions could take place.
Mr. Pearl. It is important, I would add, that individual
companies early on in the process, from 2001 to 2005--you know,
I am picking numbers--we are trying to knock on the door of the
components of the directorate to say we have got the greatest,
latest product, technology, or whatever. It wasn't necessarily
tied to what was being asked for, it was tied to what they had
developed and what they had determined to be the need. Pre-oil
spill or whatever. I think that the context was the Department
kept saying no, that is not our priority right now. That is not
what we want to do.
So what we are trying to do is develop a dialogue where we
would understand in the long run, and what Mr. Duncan in terms
of multi-year funding should also be multi-year policy, you
know, to make sure of what long-term strategies are. What are
we looking for around the curve? At which point Government and
industry together can discuss conceptually what is it that
Government is going to need to maintain a high level of
security.
I think that the problem has been that focus has been on
contract rather than on capabilities. It is on the checking of
the box rather than the nature of what we are trying to achieve
in mission. I think that if the two sides could get together to
say this is what our mission, this is what our goal, this is
what we want to achieve, what can industry bring capability-
wise to meet that mission, then we will work out the contracts
down the road. We will work out what the procurements are. We
will allow in this kind of format of a council all of the
interested parties in the room, not just one who happened to
knock loudest or shout louder. We want a fair process and that
is exactly what we are trying to call for.
Mr. Richmond. I guess this question would probably go to
Mr. Ben-Ari, which is: In your opinion, what are some of the
most surprising key findings regarding the DHS and S&T
contracting?
Mr. Ben-Ari. I think it would have to be the fact that so
much is actually spent on service contracts that are not
directly contributing to the research and development mission.
Again comparing, for example, the Department of Defense, a
different animal, with a $75 billion annual R&D budget, but for
that budget they spend about $1.5 billion on what is classified
as management and support, R&D management and support
contracts. That is about 4 percent. In DHS that is 30 percent.
There is something strange about this picture. I am not an
expert on TSA's S&T funding and contract spending. That is true
at the DHS level as well. Something here is strange.
Part of it again might be just that certain contracts were
incorrectly classified as R&D contracts as opposed to service
contracts. But that in and of itself is troubling, because all
of these years you were counting these contracts as R&D
contracts and thought that--and possibly expected certain
output from that R&D spending that never could have
materialized because it was going into something else entirely.
Mr. Richmond. Mr. Chairman, I yield back.
Mr. Rogers. I thank the gentleman.
Mr. Boylan, from your time at TSA, can you give me some
examples of things where they partnered effectively in this
process, and some projects?
Mr. Boylan. I was at DHS, not TSA, Mr. Chairman.
Mr. Rogers. I am sorry. Frankly, I am more interested in
DHS as a whole than I am just one particular segment.
Mr. Boylan. The one I know most about is explosive
detection, and with explosive detection you have something that
is very important. You have requirements that are really clear,
and those requirements are that you need to be able to detect a
specific number of substances and you need to detect an amount
at a certain level, and that drives development. The technology
in that area has developed over the last 10 years tremendously,
because there were targets for development by R&D within
companies funded by DHS and funded by international governments
as well.
Mr. Rogers. So there was some interaction, then, before
they put an RFP out in that situation?
Mr. Boylan. Yes. When I was first at the Department we
would often have, as Mr. Pearl described, we would have people
come in with the latest gadget and widget. You know, it was
constant. It kind of reminded me of the Civil War days of the
Federal Government at that point. I often wondered why am I
sitting in this discussion, because I don't know what these
people are talking about.
That was the lesson that I learned in a policy position
basically, that I needed to get a little more in-depth in what
the science was, because I was making decisions that impacted
this and I needed to know.
Mr. Rogers. In your experience, we heard Mr. Ben-Ari talk
about the percentage of DHS contracts to go to big companies,
40 percent; 30 percent for medium, and 30 percent for small. In
your experience, do smaller companies and medium-sized
companies have a greater challenge in trying to penetrate into
the Department, or really not? Is it just as difficult for a
big company as it is for a small one? I would open that up to
any of you.
Mr. Boylan. I don't have data on this. But we interact with
smaller companies all the time. Often companies are coming to
us for support because we fall into a category of a bigger
company. I hear lots of different stories and different
experiences from different companies. But I do hear a constant
theme of the difficulty of getting heard from smaller
companies.
Mr. Rogers. Is it because they don't understand the process
or what?
Mr. Boylan. That is part of it. I would have to say for my
company it is easier to engage, because we are providing
technology and servicing it every day. So that is a different
position to be in. But we do have companies developing the
newest, latest, greatest widget, and it is the common theme
that they have difficulty getting heard. That goes back to the
industry days and the advisory groups providing that
opportunity for new technology that may come from anywhere to
be heard.
Mr. Rogers. What about you, Mr. Pearl?
Mr. Pearl. We have a number of small businesses that are in
the space, and over the course of the last 10 or 12 years, long
before even 9/11, I was working with small businesses that were
trying to in essence be heard, as Mr. Boylan is talking about.
Sometimes it is part that they don't understand the process.
Sometimes it is that they have a more limited R&D budget for
themselves in terms of they have an idea and they want to sell
it and they are trying to find out what they want to do, and
the larger companies in the past have been able to invest in
R&D, and that one can fail and this one can work and whatnot.
The nature of what happens sometimes is that when the
technology or whatever, in the case of a widget, a product, or
a service, is identified in a small business way and can get in
essence some traction. Sometimes the best way to do it is for
them to align themselves with some of the larger companies, and
they become in essence partners because that company hasn't
developed it. They either are taken over, or they become subs
or whatever.
There are opportunities. The problem that my small
companies are saying to us is the following: That in this
environment, without a long-range strategic plan, they can't
afford to waste any extra time and money in developing--even if
they have a patent, even if they know what the best technology
is going to be, they need to be able to get their foothold in.
That goes to the international sphere as well.
One of the things that we have been having discussions
about is how do you take lessons learned in places like Israel
or Great Britain or Spain or Germany or India--which is not a
microcosm of itself, it is a macrocosm--but how you take those
lessons learned and apply it? We have been encouraging greater
communication between cut nation-states, that it is not just
about the U.S. technology solution. We are going to be in a
global environment.
So communication, coordination, collaboration, all of the
``-ations'' that I mentioned in my testimony, are exactly what
we are trying to encourage not just between private sector and
public sector, but between local and Federal, between the
Federal Government and nation-states, between the different
Federal agencies. We think that this Congress should be in the
business of encouraging that kind of dialogue, that kind of
communication, because we think that if you allow that, you
plant a few seeds, there will be a lot of fruit borne.
Mr. Rogers. Thank you. The gentlelady from Texas.
Ms. Jackson Lee. Thank you, Mr. Chairman. I would like to
acknowledge Mr. Richmond. I know he had an opportunity to ask
questions and he was not here when I indicated that I had a
mark-up as we speak, so I thank him for his indulgence as well.
Mr. Ben-Ari, I am going to go over something that I know
has been asked. I sort of have connections into the room and I
know what questions may have been raised. But I want to explore
this with you because I think this is a key cornerstone to what
my opening statement was.
It is about the management of R&D contract dollars by DHS.
It is noted that they spent a significant amount. The Defense
Department spent roughly $43.4 billion on R&D and $1.7 billion
was spent on R&D management and support contracts. What does
management and support actually mean, and is there a reason why
DHS is spending more contract dollars on management and support
of R&D than R&D?
Remember, in my opening statement I said we need to be
light years, many steps, ahead of individuals with shoe bombs
and underwear bombs. I am very concerned about top-heavy
management if you are not in the weeds of research. So I would
appreciate your commentary on that, and if you can add to the
fact that most Government agencies and departments in the
Federal Government rely on investment in R&D for improving
their functional capabilities. DHS's functional capabilities is
securing the homeland at all levels from aviation to border to
intelligence gathering, if you will. But according to your
report, when looking at DHS contract spending, R&D claimed less
than 10 percent. Less than 10 percent.
Now, DOD is between 11 and 14 percent. I would argue that
DHS needs to be higher because we are not a military, that we
buy heavy equipment and we are using dollars for that, as much
as we are trying to thwart terrorist acts. We are trying to be
ahead of them, we are trying to be preventative. Prevention
sometimes comes from human resources, but it also comes from
technology.
So based on your research, is there any particular reason
why DHS R&D spending, particularly last year's spending, is
particularly lower than other parts of the Federal Government?
If you can give us your overview on that question.
Mr. Ben-Ari. Sure. Thank you for that question. Starting
with the issues of research and development management and
support contracts, these are contracts that are awarded not for
actual research and development activity, but in support of
facilities and equipment that are used for research and
development activities. So these are contracts to support and
operate laboratories, test ranges, test equipment, and so
forth. The reason that distinction is important is that these
dollars do not contribute directly to any specific R&D outcome.
So when measuring R&D--and I think it is important to also
remember that R&D as is an input metric. You know how much you
are putting in. You don't know how much you are getting out. It
doesn't tell you necessarily what the outcome is of that money
that you spent.
But even when you are measuring an input metric, it is
important to measure correctly. If you are counting research
and development managing support as research and development,
you are skewing the number.
Ms. Jackson Lee. That is my point. I thank you for the
explanation. But I understood that is what it is. That is my
quarrel, is why is it so high and why is my actual R&D on DHS,
which would benefit from R&D, more so because we don't produce
heavy armor, why is it? Why do we have this imbalance with DHS?
Mr. Ben-Ari. From what the data can tell, and I hesitate to
go beyond that, but from what the data can tell, part of the
reason for the high levels of spending on management and
support of R&D is because certain contracts were misclassified
or classified in error as management and support contracts.
They were really contracts for other types of professional
services. When that error was caught, the R&D management and
support contracts were reclassified into the new category.
Ms. Jackson Lee. So are you saying that DHS is investing
adequately in pure R&D?
Mr. Ben-Ari. I didn't say that. I said that when what we
thought we were counting as research and development dollars,
specifically research and development and management and
support contract dollars, we were wrong; and these contracts
were actually--are now, hopefully, correctly reclassified as
different types of contract.
In terms of spending levels on R&D overall, I think there
is no magic number here or magic percentage: X amount of DHS
dollars must be spent on research and development.
I think that comparison with DOD is a good one. I mean, it
is a Department that does depend on technological advantage on
the battlefield, in the same way that DHS depends on a
technology advantage.
Ms. Jackson Lee. Do you think we can improve the investment
in straight R&D in DHS?
Mr. Ben-Ari. There is room for improvement if the mission
calls for it. I would look at DHS' requirements today and in
the future, and base research and development decisions on
those requirements. If technologies exist today that meet
today's requirements and requirements that we foresee for the
next 5 years, then R&D spending levels are probably adequate.
If, on the other hand, the expectation is, as you pointed out,
for different types of threats which we are not even aware of
today, then maybe the spending levels need to accommodate that
to encompass a broader range of capabilities and a broader
range of technology solutions to address those future threats.
Ms. Jackson Lee. Mission is important. You do want to have
your research and development connected to mission.
Let me ask Mr. Pearl and Mr. Boylan three questions, if I
might, together. One is TSA is engaged in reorganization. I am
not sure if it is publicly known. But do you believe it is key
to attach mission to reorganization? You know, you can move the
chairs around on a deck and one of them may fall overboard. So
the question is: Is mission and reorganization important?
Because I think I heard you mentioning something about
confusion to small businesses, and when you say that to me,
small- and minority- and women-owned businesses are my passion,
because I believe they are the job creators of America, and I
indicated to you new starts and many others start out being
small businesses.
So should reorganization be tied to mission? Would that be
more helpful for the outsider to know even where to go? Is it
harmful when you cut resources, such as acquisition resources,
such as R&D resources, for an agency like TSA? How can we
improve the informational or close the informational gap of
information when it comes to procurement for small- and
minority- and women-owned businesses? How can we fix that
problem, which is a problem overall in Federal agencies,
period? But how can we in particular fix it to an agency like
DHS, which truly benefits from R&D?
Mr. Pearl, have you got the three?
Mr. Pearl. I got the three. Let me start with the third
one. That was extensively discussed before, when you were gone.
I am hoping you will get that, as part of that and certainly in
our written testimony, that there needs to be strong,
substantive dialogue and communication, coordination,
collaboration, long before an RFP, that everyone can take part
in in a transparent and fair way. That allows small business,
large business, to be in the room, to be able to share their
expertise and their capabilities. Because before you get to
mission--and this goes to your first question--before you get
to mission, you have to know what it is that--or in the context
of that, what the capabilities are in the context of do you
want just Star Wars, do you want just, you know, science
fiction, or are there--is there a technological feasibility
that either a small business or a large business can bring to
the table? So from that standpoint, the information gap can be
filled when there are these kinds of long-before-the-contract
discussions.
With regard to the R&D cuts, there is no question but that
it is not just TSA. What I think that all of us were talking
about is not just the TSA budget when it comes to R&D; that it
comes to the whole nature of research and development and
looking ahead of the curve for DHS as a whole, and that we need
better coordination and harmonization--dare I say
standardization--so that there can be interoperability, so
there can be many companies that are part of a long-range
process when it comes to R&D.
It is not just R&D at DHS. I know that the folks at S&T
work with DOE, work with NSA, work with DOD, work with DOJ and
the FBI on a regular basis as their R&D communication. We need
to encourage that, not only within Government, but in the
public labs. We need to talk about it in terms of the private
labs that are going on. There needs to just be better
coordination and communication. I think that if you do that,
all three of your questions are answered sufficiently.
Ms. Jackson Lee. Did you answer the questions about cutting
resources being harmful to the process, resources on
acquisition?
Mr. Pearl. Well, the nature--it is transparent to say that
the private sector is worried there is going to be a cut and
therefore there isn't going to be sufficient funds for their
operation. We are not talking about dollars, we are talking
about dialogue. If in fact the mission is identified and
capabilities are there, then whatever Congress decides is going
to be appropriated to that mission, then we in the industry are
going to be able to respond.
So I am not going to take a position and the organization
is not going to take a position on whether there should be X
amount of dollars or Y amount of dollars. We just need to have
a smarter landscape, a smarter environment in Homeland Security
across the board.
Ms. Jackson Lee. Thank you.
Mr. Boylan.
Mr. Boylan. On the mission question, in our experience it
would be useful to break down some of the silos between
operations and technology, for instance. Technology at TSA is
our customer. That is primarily who we operate with. But then
when the technology gets deployed, operations is the one that
lives with it and has requirements that may be a little
different, because they are interacting with the airports and
the airlines and their requirements. So the two don't
necessarily always meet, in our experience.
So if there is a reorganization going on, which I have
heard inklings of but no details about, I would encourage that
the mission be a unified mission, and that would go a long way
to, at least helping us in our mission, to help provide the
technology that helps secure.
Ms. Jackson Lee. Two quick questions, Mr. Chairman, to Mr.
Ben-Ari and I will be finished.
Mr. Ben-Ari, do you think a mentorship program would be
helpful to small businesses?
Mr. Ben-Ari. It couldn't hurt. I think they have been
successful in the past in other agencies, in other departments,
and I think there is always room for improvement.
I would just point out again this data point of 30 percent
of DHS contract awards going to small companies. That is much
higher than both the Small Business Administration's minimum
requirements and most other Government departments. So I agree
there is always room for improvement, and a mentor program is
one.
Ms. Jackson Lee. Is it important to have the adequate
resources for R&D, adequate financial resources for R&D?
Mr. Ben-Ari. I think research and development, funding
research and development to meet future requirements is very
important. But those requirements have to be established,
ideally, together with industry--that is part of the dialogue
that I think was referred to earlier--and with the end-user.
The people in the field undertaking the operation need to be
part of this discussion as well.
Ms. Jackson Lee. But they can't be part of the discussions.
The question is: Does the United States need to invest adequate
resources for R&D from the Government perspective to protect
the homeland? Is that an important investment?
Mr. Ben-Ari. It is an important investment.
Ms. Jackson Lee. And not worthy of being looked at lightly
or being subject to random cuts?
Mr. Ben-Ari. Absolutely. We are putting future capabilities
at risk if we do not have this process in place to look at
future requirements and fund the capabilities to meet those
requirements adequately today.
Ms. Jackson Lee. Mr. Chairman, I thank you for your
indulgence. Thank you to the witnesses as well.
Mr. Rogers. I thank the gentlelady.
I just wanted to ask one more thing. Currently TSA is
engaged in a pilot program to allow third-party explosive
detection canine teams to be certified by TSA. If implemented,
TSA would then be leveraging the private sector to provide the
service that until now has been the purview of the Federal
teams.
Are there other areas in which the private sector could be
certified to provide services, that right now are only being
handled by Federal employees, that you would like to see? Are
you aware of any? Mr. Pearl, you mentioned certification in
your opening statement, and that is one of the reasons I asked
that.
Mr. Pearl. There is no question, and it goes to the R&D
question as well. The certification and designation--both Mr.
Boylan and I were testifying earlier in the summer before the
committee on the SAFETY Act, the law that already exists that
allows DHS to give certification and designation to
technologies that are antiterrorist technologies. That hasn't
been fully marketed and fully publicized. That nature of how
the Government can in essence give a sense of recognition to
technologies that provide that is one way.
I would not limit the whole R&D argument to just the
Federal Government's role. I think the public labs, the
academia, and in the private sector has R&D investment that
they are ready to do as well.
So the nature of the industry, the third party in terms of
designation and standardization, is something that we are
definitely interested in and the specifics we can look at
more--we can get back to you on other ways that have worked in
the past.
Mr. Rogers. Well, I am definitely going to follow up on
your recommendations earlier about making sure we include in
our authorization bill next month language to encourage the
Department to have these early--early conversations with the
private sector in some sort of a format that is practical.
But one thing that I am thinking about, I am about to start
a Transportation Security Caucus here in the Congress. We have
a lot of members not on the Homeland Security Committee that
are interested in this topic. So to facilitate communication
with them, I am going to be starting that.
Is there a way that you think such a caucus of Members
could bring about more of this dialogue, or really does it have
to just come through the Department with the private sector?
Mr. Boylan. I think that Members all have constituent
airports and other transportation constituents who really would
like to have their voices heard, in my experience, and I think
that would be a valuable input for all of us, technology and
Government.
Mr. Rogers. Okay. Do you have more questions?
Ms. Jackson Lee. If the gentleman would yield, I would hope
that as well, we might add a very strong component on small and
MWBEs. Even though I hear the 30 percent, I think there are new
companies that don't know the system, way beyond the Beltway,
that I would like to see having an opportunity to work for the
Federal Government. Let's get them from Utah and Alabama,
Mississippi, Michigan, Illinois. I know that there may be some.
But that is where the gap of information is.
If you are not buzzing around the area, which is the crowd
that understands Federal contracting, you are not going to get
too many beyond the Beltway who understand this process. I
think they may have very worthy ideas, and I would like to make
sure they get the opportunity to present their ideas to help
the American people and secure the homeland.
Thank you. I yield back.
Mr. Rogers. I thank the gentlelady. I thank the witnesses.
You have been very helpful. I would ask that there may be some
written questions from Members who couldn't make it that they
would want to submit to you, and I would ask you to respond to
those within 10 days. After that we will close it out.
With that, this committee is adjourned.
[Whereupon, at 3:31 p.m., the subcommittee was adjourned.]
TSA REFORM: EXPLORING INNOVATIONS IN TECHNOLOGY PROCUREMENT TO
STIMULATE JOB GROWTH, PART III
----------
Thursday, November 3, 2011
U.S. House of Representatives,
Subcommittee on Transportation Security,
Committee on Homeland Security,
Washington, DC.
The subcommittee met, pursuant to call, at 2:02 p.m., in
Room 311, Cannon House Office Building, Hon. Mike Rogers
[Chairman of the subcommittee] presiding.
Present: Representatives Rogers, Cravaack, Turner, Jackson
Lee, and Davis.
Mr. Rogers. The Committee on Homeland Security,
Subcommittee on Transportation Security will come to order.
The subcommittee is meeting today to continue to examine
innovative solutions to technology procurement at TSA that
could generate cost savings for the Federal Government and
stimulate job growth in the private sector.
I want to thank all of our witnesses for being here to
participate in what I believe is going to be a very fruitful
and timely hearing. I am pleased to see the spectrum of offices
that are participating in aviation technology, development, and
procurement that are represented at the table.
Leading up to this hearing we have had testimony from
former DHS officials, the GAO, and industry representatives on
how we can optimize the relationship between TSA and the
private sector. They all expressed both success stories and
challenges that TSA faces in finding the best ways to achieve
this collaboration that is so important to developing the right
technologies for risk-based screening.
We now invite DHS, TSA, and the Science and Technology
Directorate and the DHS Office of Inspector General to speak on
what they perceive to be successes, challenges, and needed
changes to foster innovation and meet our security needs as
effectively as possible.
One of TSA's stated aviation security goals is to develop
enhanced technologies and capabilities to enable risk-based and
intelligence-driven screening processes. I want to emphasize
how important this goal is and what an opportunity it
represents for providing both security and jobs. The question
is: How can we work together to ensure that TSA is getting the
technologies it needs to secure the traveling public and
commerce, while promoting innovation and, therefore, job growth
in the private sector?
I know that Dr. Nayak in his capacity as Chief Procurement
Officer has stated that one of his strategic objectives is to
establish quality communication between industry and DHS. I
look forward to hearing from him on how the initiatives within
his offices are making that happen.
I would also like to hear how acquisitions are being
standardized across the Department so that vendors working with
multiple components can do so with a level of predictability
that they say is currently lacking.
From Mr. Kane and Mr. Benda, I trust you will address the
joint strategy you have undertaken to ensure that you have a
workable plan for aviation technology investment. I know the
existing plan looks out 2 years ahead, but I would love to see
this extended further, say to 4 or 5 years, because I believe
this is what industry needs to help achieve the mission
successfully. I also think that TSA has the opportunity to be
more of a leader in setting international standards for
screening technology which would increase the market space for
many U.S. companies.
Finally, I look forward to Mr. Edwards' finding from the
Inspector General's Office, which has produced some very useful
reports on how acquisition of detection equipment can be
consolidated across the Department. We know from our prior
hearings that more use of strategic sources, better industry
days, reestablishment of the Joint Requirements Council, and
transparency with industry on the 5-year outlook are some of
the key areas we must strengthen.
I look forward to hearing the perspective of all the
witnesses on these and other matters where we can work together
to find solutions. Industry has ideas, and I want to ensure
that TSA and DHS are listening to them. Then I want to turn
those ideas into solutions.
We have posed the question: What are the available options
for adjusting how things are done at TSA that will foster more
innovative capacity in the technology sector? Now we need to
establish answers and implement the needed changes.
We have an obligation to examine the ways to solve some of
our Nation's most pressing challenges, of which high
unemployment tops the list right now. We must leave no stone
unturned in finding ways to reverse that trend and support all
sectors of the economy, including technology innovation, which
has long been one of America's greatest strengths.
With that, I typically would yield right now to Ms. Jackson
Lee, but, as I told the panelists a minute ago, she is in
Judiciary with an amendment of her own and can't leave, so we
are going to pass that and go straight to the witnesses for
their testimony.
Nick Nayak is the Chief Procurement Officer at the
Department of Homeland Security. Prior to coming to DHS, Mr.
Nayak served as Deputy Director for Internal Revenue Service
Procurement. Before rising to Deputy Director for IRS
Procurement, Mr. Nayak served in several high-impact leadership
positions, including Director of Strategic Acquisition
Initiatives, Deputy Director of the Office of Information
Technology Acquisition, Assistant to the Director of
Information Technology Program Management, Project Executive
for the IRS Commissioner's Readiness Project, and Director of
the Treasury Acquisition Institute.
Robin Kane became Assistant Administrator for Security
Technology at TSA in June 2009 after serving in an acting role
since December 2008. As Assistant Administrator, Mr. Kane
oversees the implementation and development of security
technologies across multiple modes of transportation. He is
responsible for development, test and evaluation, acquisition
and deployment, and the maintenance of all TSA security
technologies and systems. Mr. Kane joined TSA in 2005 as a
branch chief within TSA's Office of Budget and Performance.
Prior to TSA, Mr. Kane spent 20 years in the Coast Guard.
Paul Benda joined the Department of Homeland Security
Science and Technology Directorate in January 2010. He serves
as the Under Secretary's Chief of Staff and Director of the
Homeland Security Advanced Research Projects Agency.
Can't you find anything else to do? You don't have much on
your plate.
Prior to joining DHS, Mr. Benda was Director of the Project
Integration Office at the Department of Defense where he
oversaw the design, implementation, testing, and commissioning
of all security systems in the Pentagon reservation. Earlier,
Mr. Benda served as the Pentagon's Chemical, Biological,
Radiological, Nuclear, and Explosives Director; and in civilian
service he was a program manager at DOD's Defense Advanced
Research Projects Agency.
Accompanying Mr. Benda in the audience today is Dr. Susan
Hallowell, Director of the Transportation Security Laboratory.
The TSL is a Federal laboratory of the DHS Science and
Technology Directorate that is dedicated to finding and testing
solutions to detect and deter weapons and explosive threats to
transportation. Prior to being named as Director, Dr. Hallowell
managed and executed research and development for explosives
detection for DHS under TSA.
Dr. Hallowell has worked for DHS and the Federal Aviation
Administration for 20 years in the areas of explosive
detection, research, and development and is an expert in the
area of trace detection of explosives. Prior to working for the
FAA, she worked as a research chemist for the U.S. Army in the
area of detection and protection against chemical warfare
agents.
On behalf of the committee, I would like to thank Dr.
Hallowell for her decades of service and her efforts at
Transportation Security Laboratory that are vital to the
security of transportation systems around the country.
Charles Edwards assumed the position of Acting Inspector
General for the Department of Homeland Security in February
2011, where he previously served as Deputy Inspector General
for the Department. Mr. Edwards has over 20 years' experience
in the Federal Government, where he has held leadership
positions at the Transportation Security Administration, the
United States Postal Service, and the USPS Office of Inspector
General.
We have got a great panel here, and this is an area I care
very much about. We can make some great changes. I hope that
the witnesses here have had a chance to look at what came from
our previous two hearings with Michael Jackson and Elaine Duke
from their perspective in the rearview mirror and then the
industry panel we had. I know they are all anxious to hear what
you have to say.
We will start with Dr. Nayak. You are recognized for 5
minutes to summarize your opening statement.
STATEMENT OF NICK NAYAK, CHIEF PROCUREMENT OFFICER, U.S.
DEPARTMENT OF HOMELAND SECURITY
Mr. Nayak. Thank you, Mr. Chairman.
Chairman Rogers, Ranking Member Jackson Lee, and Members of
the subcommittee, I am pleased to testify before you today.
As DHS Chief Procurement Officer, I am responsible for
oversight and policy related to DHS' annual procurement of
approximately $14 billion in goods and service. My background
includes growing up in family-operated small businesses,
working in the private sector for small and large businesses
bidding on defense contracts, and more than 20 years of public
service dedicated to building the Federal acquisition workforce
and driving procurement initiatives to save taxpayer dollars.
Since arriving at DHS a little more than a year ago, I
established four priorities that I am using to improve DHS
procurement: Quality contracting, quality people, quality
program support, and the one priority that I added beyond my
predecessors, quality interaction with industry and Government
communication. Supporting each of my priorities are a number of
initiatives that move DHS procurement forward in getting good
deals for the taxpayer.
In the area of quality contracting, DHS has achieved
substantial success in spending money more efficiently through
our Strategic Sourcing Program. The Department leads the
Federal Government in coordinated procurements and has been
recognized by the Office of Management and Budget, the General
Services Administration, and the Partnership for Public Service
because of our results. In fiscal year 2010, DHS saved over
$347 million using strategically sourced contracts.
In addition to savings, the Strategic Sourcing Program also
focuses on maximizing the Department's use of small businesses
and small disadvantaged business. Small business received
approximately 36 percent of the total dollars that were
strategically sourced in fiscal year 2010, far exceeding the
Government-wide goal of 23 percent. We intend to expand the use
of this valuable procurement tool in fiscal year 2012.
In the area of quality communication with industry, I
recently issued a Department-wide vendor communication plan.
This publicly posted plan begins with a personal commitment
from each head of contracting activity to enhance component
engagement for all procurements. Requirements of the plan will
result in an increased number of RFIs, draft RFBs, new and
improved industry days related to specific procurements, a
revamped on-line procurement forecast system supported by
component procurement liaisons to answer inquiries from all in
industry, a new and improved annual DHS industry day, and
attendance at over 100 small business outreach events,
including 10 small business vendor outreach sessions that
include one-on-one appointments.
In addition to my plan, we are investigating the
possibility of a transparent industry advisory council and
dialogue forum separate and apart from individual procurements.
It must be open to all. We are contemplating reversing industry
days, where industry comes in and they are invited to discuss
their capabilities with us. I believe, given time for this plan
to take hold, we are going to be a leader in communication with
industry.
In the areas of quality people and program support, the
Department is committed to recruiting, developing, and
retaining a world-class acquisition workforce. Through
aggressive recruitment and retention strategies, the DHS
contracting workforce has increased from 603 in fiscal year
2004 to more than 1,400 professionals who processed over 90,000
contracting actions and obligated $14 billion in fiscal year
2010 and in 2011.
However, the Department's rate of hiring contracting and
programming support professionals has historically lagged well
behind our needs. Our primary mechanism to correct this problem
is our Acquisition Professional Career Program. This is a 3-
year program that provides participants with acquisition
training experience through intensive training and on-the-job
experience.
Further, DHS has made significant progress in approving its
existing workforce through training and certification for
multiple acquisition career fields. A well-trained acquisition
workforce can engage industry and apply flexible procurement
strategies because they know more and they have better
experience. Most importantly, a better workforce yields real
savings to the taxpayer by a getting better business deal.
DHS is committed to continuing to improve the acquisition
process by enhancing our workforce, by partnering with
industry, and incorporating best practices such as strategic
sourcing. This approach supports the Department's frontline
operations while ensuring effective oversight and efficient use
of taxpayer resources.
Thank you for the opportunity to participate today. I look
forward to questions.
[The statement of Mr. Nayak follows:]
Prepared Statement of Nick Nayak
November 3, 2011
Chairman Rogers, Ranking Member Jackson Lee and Members of the
subcommittee, I am pleased to testify before you today. As the Chief
Procurement Officer since October 2010 at the Department of Homeland
Security (DHS), I am responsible for oversight and policy related to
DHS's annual procurement of approximately $14 billion in goods and
services. DHS continues to improve its purchases across the Department
first and foremost through the Strategic Sourcing Program. We are also
expanding communication with large and small businesses to ensure we
procure the right items at the right prices. The DHS acquisition
workforce uses these tools to spend taxpayer resources efficiently and
effectively. Today, I am happy to provide you an update on our
continued success with strategic sourcing, our expansion of vendor
communication and the status of our acquisition workforce.
quality contracting--strategic sourcing
DHS has achieved substantial success in spending money more
efficiently through our Strategic Sourcing Program. The Department
leads the Federal Government in coordinated procurements and has been
recognized by the Office of Management and Budget, the General Services
Administration, and the Partnership for Public Service because of our
results. In fiscal year 2010, DHS saved over $347 million using
strategic sourcing contracts. These savings come from initiatives that
span across eight commodity families including:
Industrial Products & Services
Information Technology & Telecommunications
Professional & Office Area Support Services
Security
Facilities & Construction
Office Management & Miscellaneous Products
Travel & Lodging
Logistics Operations & Package Delivery Services
The Department realized these significant savings by choosing the
Strategic Sourcing Program for approximately $2.6 billion of its
requirements. This savings represents approximately 18 percent of the
$14 billion spent on contracts at the Department in fiscal year 2010.
In addition to savings, the Strategic Sourcing Program also focuses
on maximizing the Department's use of small and socio-economic
disadvantaged companies. Small businesses received approximately 36
percent of the total contract dollars that were strategically sourced
in fiscal year 2010, far exceeding the Government-wide small business
overall contracting goal of 23 percent. In fiscal year 2011, DHS
awarded 13 new strategic sourcing initiatives. We look forward to
continuing to expand this valuable procurement tool in fiscal year
2012.
The Strategic Sourcing Program has achieved success, in part, by
facilitating collaboration between industry and Government. The Program
undertakes comprehensive market research and examines buying trends
across the Department. Based on industry standards and knowledge of the
marketplace, DHS refines the requirement and creates the procurement
strategy. When we have used this collaboration as part of the Strategic
Sourcing Program, DHS has achieved robust competitions and significant
cost savings.
DHS's Wireless Devices procurement is one example of the Strategic
Sourcing Program listening to industry and responding accordingly. In
this case, we learned that the telecommunications carriers did not have
the existing capability to provide the program with management reports.
The procurement team decided to eliminate the reporting requirements
from the carrier agreements and developed a separate procurement for
the enterprise-wide reporting services. This modification allowed the
telecommunication carriers to reduce the prices on the devices which
DHS believes will result in a net savings that can be reported when the
purchase is complete.
Another example of collaboration that resulted in strategic
sourcing savings was the purchase of enterprise software licenses. This
procurement was one of several initiatives implemented as part of
Secretary Napolitano's Efficiency Review to leverage the purchasing
power of the entire Department. Multiple commercial and Government
sources for software licenses were evaluated, allowing the Government
to develop a strategy for purchasing an Enterprise Licenses Agreement
(ELA) that resulted in $40 million in savings during fiscal year 2010
due to lower prices and streamlined the procurement process.
quality industry-government communications
The Department is committed to promoting enhanced vendor engagement
in the acquisition process. Building on the success of the Strategic
Sourcing Program, I have included vendor communications as a
cornerstone of my Strategic Plan. My publicly posted Vendor
Communication Plan begins with a personal commitment from each Head of
the Contracting Activity (HCA) to enhance Component engagement with
industry, allowing industry to see how DHS will work to improve
dialogue. The signed pledges have already resulted in increased
communication with industry prior to and during source selection.
In addition to holding executives accountable for increased
communication, the Department also includes many other features in its
Plan to strengthen vendor communication. For example, my office hosts a
DHS Industry Day every year. Last year's event was attended by
approximately 1,000 industry representatives and 2,000 participants via
webcast. The event includes panels from each Component moderated by the
appropriate HCA that provide program- and acquisition-specific
information on the Components' planned major acquisitions. The Industry
Day also facilitates discussion among companies and connects industry
with the responsible Government representatives.
Additionally, the Department conducts or attends over 100 small
business outreach events each year. Vendor Outreach Sessions, conducted
ten times a year by the Department's Office of Small and Disadvantaged
Business Utilization (OSDBU), provide small businesses pre-scheduled
one-on-one appointments with a DHS small business specialist. These
sessions provide small businesses with an opportunity to discuss their
capabilities and learn of potential procurement opportunities. Notices
of upcoming Vendor Outreach Sessions are posted to the Small Business
Central Event Listing on FedBizOpps, as well as on the DHS public
website to maximize participation. These efforts have contributed to
the awarding of approximately 30 percent of all DHS contracts to small
businesses from 2007 through 2011, and outpacing all other large
Federal agencies in achieving all of the Federal small business goals
each year. These small businesses are making a significant contribution
to DHS's mission.
As an example, in fiscal year 2011 DHS awarded a $2 million
contract to Astrophysics, Inc., a small business located in California,
for a new technology or technological ideas for screening air cargo
assembled into pallets, sometimes called ``skids''. Currently, in
certain circumstances, pallets must be broken down before screening,
which costs more and takes more time. Astrophysics Inc. is creating a
system that will increase efficiency by scanning a full complement of
medium- and high-density air cargo across a wide range of commodities
(e.g., apparel, produce, seafood/meats, flowers, electronics, machine
parts, printed material, and miscellaneous durable goods). Once
operational, the system will reduce TSA's costs, reduce the time for
screening, and enhance the security of air cargo. DHS values the
contributions of its small business partners and recognizes that they
are essential to accomplishing our mission.
Finally, to assist large and small vendors, DHS publishes an
acquisition forecast available on DHS's website through the new
Acquisition Planning Forecast System. This new forecasting tool was
implemented in response to industry, and will respond to industry
concerns and provide an effective mechanism for industry to connect
directly with those who may be interested in their technology.
quality people
Effective industry engagement and good procurements require a
trained and fully-staffed acquisition workforce. Through aggressive
recruitment and retention strategies, DHS's contracting workforce has
increased from 603 in fiscal year 2004 to more than 1,400 professionals
who processed over 90,000 transactions, and obligated $14 billion in
fiscal year 2010. However, the Department's rate of hiring contracting
professionals has historically lagged well behind the Department's
needs. Our primary mechanism to correct this problem is our Acquisition
Professional Career Program (APCP). This 3-year program provides
participants with acquisition training and experience through intensive
training and on-the-job experience. DHS's future procurement
improvements depend on continuing to grow its acquisition workforce
through the APCP.
Further, DHS has made significant progress in improving its
existing workforce through training and certification for multiple
acquisition career fields. All DHS contracting professionals receive
appropriate training and experience commensurate with their
responsibilities and certification requirements. As reported in our
March 2011 update to our acquisition human capital plan, we continue to
increase the training and experience of our program managers so they
have the tools they need to successfully manage their assigned
procurements.
Our commitment to an improved professional workforce leads to an
acquisition process that is more effective and efficient. A well-
trained acquisition workforce can engage industry and apply flexible
procurement strategies because they know more and have better
experience. Most importantly, a better workforce yields real savings to
the taxpayer by getting a better business deal. In order to continue to
expand communication with industry and deepen our procurement
capability, DHS must continue to invest in our acquisition workforce.
Our APCP program will continue to provide new energetic talent
throughout DHS's Components. Our centralized training of all
acquisition fields must be maintained so that all involved in the
procurement process have the knowledge and tools they need to
effectively engage industry and ensure DHS buys what it needs at a
reasonable price.
conclusion
DHS is committed to continuing to improve our acquisition process
by enhancing its acquisition workforce and by partnering with industry
and incorporating best practices from across the Department to
efficiently procure common goods and services through the Strategic
Sourcing Program. This approach supports the Department's front-line
operations while ensuring effective oversight and efficient use of
taxpayer resources.
Thank you for the opportunity to participate in your discussions
regarding the specific DHS procurement practices. I look forward to
your questions.
Mr. Rogers. Mr. Kane.
STATEMENT OF ROBIN E. KANE, ASSISTANT ADMINISTRATOR, SECURITY
TECHNOLOGY, TRANSPORTATION SECURITY ADMINISTRATION
Mr. Kane. Good afternoon, Chairman Rogers, Ranking Member
Jackson Lee, and distinguished Members of the subcommittee.
Thank you for the opportunity to testify today regarding the
ways we are advancing security through innovation of new and
improving technologies.
TSA procures and deploys the detection equipment used to
screen over 1.5 million passengers a day in the Nation's
airports, as well as their carry-on and checked baggage. In
addition, we test and approve technologies for use in screening
air cargo and in other transportation modes.
We work closely with the DHS Science and Technology
Directorate as well as the private sector, including National
labs, Federally-funded research and development corporations,
and universities. A specific result of our collaboration was
the joint development and publishing of the aviation security
technology research and development strategy in March 2011. It
contained an R&D roadmap to keep our efforts closely aligned.
Since early 2010, TSA has also had a broad agency
announcement soliciting input on transportation security
innovative concepts. The BAA solicits proposals for research
projects which offer potential for advancement and improvement
of TSA security operations, technologies, processes, human
factors, and capabilities. To date, TSA has received over 100
proposals and made four awards under the BAA. Those discussions
and engagements facilitate developing the requirements to
address evolving threats to aviation and structure TSA's
acquisition programs.
TSA continues to advance security by investing in
innovative technologies, improving efficiencies, and pursuing
equipment standardization initiatives. Examples include
advanced imaging technology, or AIT, which helps transportation
security officers screen passengers for metallic and non-
metallic explosives as well as other anomalies. TSA is
currently upgrading many of these machines with automated
target recognition software, providing the same high level of
detection, while enhancing privacy protection by replacing
passenger-specific images with a generic outline of a person
that is identical for all passengers.
Early next year, TSA will field test an identification and
boarding pass scanning system which quickly screens passengers
for fraudulent IDs and boarding passes. If proven successful,
this technology could replace the current ``lights and loupes''
manual method of authentication.
TSA is also upgrading current X-ray systems, deploying
next-generation systems to screen carry-on luggage at the
security checkpoint. Next-generation units feature enhanced
explosive detection capabilities that detect a wider range of
threats.
Bottled liquid scanner systems are used to detect potential
liquid or gel threats, while differentiating between liquid
explosives and common, benign liquids, such as baby formula or
insulin. Next-generation systems detect a wider range of
explosive materials and use light waves to screen sealed
containers for explosive liquids. These units have been
deployed to 230 airports.
Over the next 5 years, a large number of TSA's explosive
detection systems will reach the end of their useful life and
replacing these aging units is a top priority. TSA intends to
recapitalize them with more capable machines with greater
detection capability through an on-going procurement.
TSA is also using technology in innovative configurations.
This past October we began testing TSA PreCheck, a voluntary
passenger pre-screening initiative with an actual known
traveler population at four U.S. airports, placing more focus
on pre-screening individuals who volunteer information about
themselves prior to flying. Because we know more about these
passengers, TSA PreCheck travelers may divest fewer items,
which could include leaving on their shoes and jacket.
Of course, TSA will continue to incorporate random and
unpredictable security measures throughout the security
process. At no point is any traveler guaranteed expedited
screening.
Initial feedback from TSA PreCheck passengers has been
favorable. TSOs are receiving very positive comments and the
two partner airlines have successfully demonstrated the
required technical capabilities.
All of these efforts benefit from partnerships within DHS
and with industry. TSA will continue to strengthen those
relationships and processes to deliver the best technology and
capabilities to provide effective security.
Chairman Rogers, Ranking Member Jackson Lee, I thank you
for the opportunity to appear today, and I look forward to
answering your questions.
[The joint prepared statement of Mr. Kane and Mr. Benda
follows:]
Joint Prepared Statement of Robin E. Kane and Paul Benda
November 3, 2011
Good afternoon, Chairman Rogers, Ranking Member Jackson Lee, and
distinguished Members of the subcommittee. Thank you for the
opportunity to testify today about the Transportation Security
Administration's (TSA) use of technology that supports our layered
approach to securing the Nation's transportation systems while ensuring
freedom of movement for people and commerce. To accomplish this
mission, we employ risk-based, intelligence-driven operations to
prevent terrorist attacks and reduce the vulnerability of the Nation's
transportation system. While no layer on its own addresses all risk, in
combination they create a strong and formidable system.
Last fall, TSA Administrator John S. Pistole directed the agency to
explore ways to develop a strategy for achieving risk-based security. I
am pleased to have an opportunity today to discuss with the
subcommittee the processes employed by TSA to advance innovation
through new technologies that strengthen our multi-layered security
system.
creating innovative solutions by partnering with industry
TSA has forged a number of partnerships to develop and deliver
solutions to combat emerging and evolving threats to transportation
security. Specifically, TSA works with the DHS Science and Technology
Directorate (S&T) to create innovative solutions to threats and
challenges. TSA also collaborates with the private sector including
National labs, Federally-funded research and development corporations
(FFRDCs), universities, and other qualified vendors at industry days,
technical forums, conferences, and program reviews.
collaborative approaches to technology innovation
TSA is also working closely with trade associations that focus on
homeland security issues to share its vision with industry
stakeholders. Since early 2010, TSA has issued an annual Broad Agency
Announcement (BAA) to collect innovative concepts from industry to
inform future decisions for research and development (R&D) efforts and
to identify innovation already available in the marketplace. In the
last year, TSA pursued several submissions for proof-of-concept
demonstrations focused on insider threat analysis, behavior detection,
and explosive detection, and is currently reviewing numerous other
proposals.
advancing aviation security with technology investments
To address the evolving threats to aviation, TSA continues to
advance security by investing in innovative technologies, improving
workforce efficiencies, and pursuing initiatives to further standardize
and integrate equipment. Such advancements and initiatives include:
Advanced Imaging Technology and Automated Target Recognition
Advanced Imaging Technology (AIT) helps Transportation Security
Officers (TSOs) screen passengers for metallic and non-metallic
explosives as well as other non-metallic threats. Currently, there are
more than 500 AIT units at nearly 100 airports. Two months ago, TSA
purchased an additional 300 machines, which are being deployed with
Automated Target Recognition (ATR) software. ATR software upgrades are
designed to further enhance passenger privacy by eliminating passenger-
specific images and instead displaying a generic outline of a person
that is identical for all passengers. By removing the need for an
officer to view images in a remote location, the use of the software
also improves throughput capabilities of the technology and streamlines
the checkpoint screening process. The ATR software provides the same
high level of detection as AIT without the software and it allows for
more targeted pat-downs because of the manner in which anomalies are
displayed. The President's fiscal 2012 budget requests funding for an
additional 275 AIT units. The availability of this equipment supports
long-term needs while increasing efficiencies at checkpoints with even
more effective ATR software and a reduced footprint, which will inform
future deployment strategies.
Credential Authentication Technology/Boarding Pass Scanning Systems
The Credential Authentication Technology/Boarding Pass Scanning
Systems (CAT/BPSS) provide TSOs with an effective tool to quickly
detect fraudulent or altered documents, enhancing security and
increasing efficiency. This equipment automatically and concurrently
verifies passenger boarding passes and IDs that passengers present to
TSA during the security checkpoint screening process, as well as those
IDs presented by airport and airline personnel to access sterile areas.
We plan to conduct CAT/BPSS technology pilots in the coming months
and throughput will be evaluated very closely as we determine the
overall operational suitability of the various solutions. If testing
proves successful, the technology could replace the current manual
``lights and loupes'' method of ID and boarding pass authentication.
Automated Wait Time
Automated Wait Time (AWT) systems utilize technology to monitor and
track queuing traffic at the security checkpoint, enabling TSA to
reallocate resources to areas of higher congestion and priority as
needed. TSA preliminarily tested an AWT system at the TSA Systems
Integration Facility (TSIF) and anticipates testing it in airports in
the coming months.
Next Generation Advanced Technology X-Ray
TSA is in the process of upgrading currently deployed AT X-ray
systems, as well as deploying next generation, or AT-2 systems. This
technology is used to screen carry-on luggage at the security
checkpoint. In addition to other upgrades that streamline the bag check
process, next generation AT X-ray units feature enhanced explosive
detection capabilities that enable TSA to detect new threats.
There are currently more than 1,000 AT units at nearly 100
airports. These systems enhance security effectiveness and efficiency,
and deployments will continue into calendar year 2012. We are working
closely with DHS S&T and our qualified vendors to assess the AT-2
system's capability to detect liquids, aerosols, and gels (LAG), which
would help to expedite the secondary bag search process.
Bottled Liquids Scanners
Bottled Liquids Scanner (BLS) screening systems are used to detect
potential liquid or gel threats which may be contained in a passenger's
property while differentiating between liquid explosives and common,
benign liquid such as baby formula and insulin. Next-generation bottled
liquids scanner screening systems have the ability to detect a wider
range of explosive materials and use light waves to screen sealed
containers for explosive liquids. TSA recently deployed 500 next-
generation BLS units to airports Nation-wide to add to the more than
1,000 BLS units currently deployed at 230 airports.
Shoe-Scanning Detection Technology
Shoe-Scanning Detection (SSD) technology is an advanced technology
which would be capable of detecting both metallic and non-metallic
threats concealed in passenger footwear without requiring passengers to
remove their footwear at the checkpoint. DHS S&T recently issued a
Broad Agency Announcement that supports R&D efforts to develop shoe-
scanner detection systems that meet TSA detection requirements.
Explosives Trace Detection
Explosives Trace Detection (ETD) technology is used at security
checkpoints around the country to screen carry-on baggage and
passengers for traces of explosives. Officers may swab a piece of
luggage or passenger hands and then use ETD technology to test for
explosives. The swab is then placed inside the ETD unit, which analyzes
the content for the presence of potential explosive residue. TSA is
expanding its use of ETD technology in airports as part of its layered
approach to aviation security.
Explosives Detection Systems Recapitalization and Optimization
Over the next 5 years, a large number of Explosives Detection
Systems (EDS) will reach the end of their useful life and replacing
these aging units is a top priority. TSA will fund recapitalization
projects, which include the work required to remove the existing EDS,
minimal modifications to the Baggage Handling System infrastructure,
and the associated purchase and installation of the new EDS. TSA's plan
to replace the aging EDS fleet of equipment will be prioritized based
on a combination of age and maintenance data.
risk-based security
In the past, Administrator Pistole has spoken to this subcommittee
about TSA's risk-based approach to enhancing security. I would like to
provide you with the current status of two of our new risk-based
programs that are supported by technological advancements:
TSAPreTM
This past October, TSA began testing a limited and voluntary
passenger pre-screening initiative with a small known traveler
population at four U.S. airports (Miami, Dallas-Ft. Worth, Detroit, and
Atlanta). This pilot program will help assess measures designed to
enhance security, by placing more focus on pre-screening individuals
who volunteer information about themselves prior to flying in order to
potentially expedite the travel experience. By learning more about
travelers through information they voluntarily provide, and combining
that information with our multi-layered system of aviation security, we
can better focus our limited resources on higher-risk and unknown
passengers. This new screening system holds great potential to
strengthen security while significantly enhancing the travel
experience, whenever possible, for passengers.
During this pilot, TSA is using pre-screening capabilities to make
intelligence-based risk assessments for passengers who voluntarily
participate in the TSAPreTM program and are flying
domestically from one of the four airport pilot sites. Eligible
participants include certain frequent flyers from American Airlines and
Delta Air Lines as well as existing members of U.S. Customs and Border
Protection's (CBP) Trusted Traveler programs including Global Entry,
SENTRI, and NEXUS who are U.S. citizens and are flying on participating
airlines. The data collected from these pilot sites will inform our
plans to expand the program to include additional airlines as well as
other airports that participate in CBP's Global Entry program, once
they are operationally ready.
TSAPreTM passengers are pre-screened each time
they fly from participating airports. If the indicator embedded in
their boarding pass reflects eligibility for expedited screening, the
passenger is able to use the TSAPreTM lane. Because
we know more about these passengers, TSAPreTM
travelers are able to divest fewer items, which may include leaving on
their shoes, jacket, and light outerwear, as well as other
modifications to the standard screening process. As always, TSA will
continue to incorporate random and unpredictable security measures
throughout the security process. At no point are
TSAPreTM travelers guaranteed expedited screening.
Transportation Security Officers (TSOs) in the four pilot airports
are receiving very positive feedback from TSAPreTM
travelers while the two partner airlines have successfully demonstrated
the technical capabilities required to participate in the program, thus
paving the way for other airlines to follow. As we learn from these
pilots, we are working closely with other airlines and airports to
determine when they may be operationally ready to join. We are also
working with CBP to ensure that individuals who want to apply for
Trusted Traveler Programs are able to do so in an efficient manner.
Known Crewmember
We hold airline pilots responsible for the safety of the traveling
public every time they fly an aircraft. It makes sense to treat them as
our trusted partners. To build on our risk-based approach to security,
we are currently testing another identity-based system to enable TSA
security officers to positively verify the identity and employment
status of airline pilots. The Known Crewmember program is a joint
initiative between the airline industry (Air Transport Association) and
pilots (Air Line Pilots Association, International (ALPA)), which
allows uniformed pilots from 22 airlines to show two forms of
identification that are checked against a database called the ``Cockpit
Access Security System (CASS),'' which confirms identity. After more
than 2 months into the pilot program, and with deployments nearly
complete at the seven participating airports, over 59,000 uniformed
pilots have been cleared through the process with an average of nearly
1,900 approvals per day. Both Known Crewmember and
TSAPreTM are clear examples of TSA's commitment to
focusing its attention and resources on those who present the greatest
risk, thereby improving security and the travel experience for
passengers across the country.
conclusion
TSA will continue to enhance its layered security approach through
state-of-the-art technologies, expanded use of existing and proven
technology, passenger pre-screening, and other developments that will
continue to strengthen aviation security. Chairman Rogers, Ranking
Member Jackson Lee, I thank you for the opportunity to appear before
you today, and I look forward to answering your questions about the use
of innovative technology to provide additional layers of security to
our Nation's transportation systems.
Mr. Rogers. I thank you.
As a fellow who got to go through the PreCheck system this
past week for the first time, that lane was wonderful. I got to
keep my shoes on and my belt and everything. All I had to do
was take my keys and phone out. That is a great initiative. I
am hopeful that we can see that soon expanded after the first
of the year everywhere, because a lot of people are going to
like it.
Now I would like to recognize the Ranking Member, my friend
and colleague from Texas, for her opening statement.
Ms. Jackson Lee. Mr. Chairman, first of all, let me thank
you for your courtesies and thank the witnesses.
I notice, I assume, Mr. Chairman, you have indicated that
there is a vote on the floor, and let me acknowledge the fact
that in overlapping committees, I think there is some law
enforcement officers even in the room, I know that Ms. Bell and
Mr. Daniels are guests that are here in the room, one with
Ultimate Lock, one a law enforcement officer. We were dealing
with synthetic drugs, Mr. Chairman, in Judiciary in a markup. I
was in the middle of a markup. I deeply appreciate your
courtesies.
Other Members, let me give comfort and defense to other
Members. There are overlapping hearings. But this is a very
important series of hearings, and I want to thank the
witnesses, but I want to thank the Chairman. I think we have
gained a lot of knowledge, that hopefully we will even come
with an omnibus bill dealing with technology, small businesses,
how we can improve our security.
Mr. Chairman, you won't mind if I do one slight tongue-in-
cheek moment on technology that will include blinders on TSA
inspectors for suitcases. We don't want to tempt anyone for
what they might see in suitcases.
Mr. Chairman, I guess you have missed the news, but I have
expressed my great consternation in that, and I hope that Mr.
Nayak is listening to me when I say that you should stick to
the work that you are supposed to be doing when you are
inspecting suitcases.
But let me quickly, because--they will get that after the
fact, Mr. Chairman--I want an omnibus bill on that. Will you
join me in cosponsoring legislation?
As we have discussed in the past, securing our Nation
requires not only vigilance and resources but also innovation
and imagination. As I indicated, this is a very important
series of hearings that we have explored in focusing on TSA
reform but also to generate guidance on how we move forward in
the 21st Century.
New technology, helping small businesses, creating the
opportunity, if you will, for small businesses to show their
wares to secure the homeland. That is what I want to be the
resounding part of this series of hearings. How do we ensure
that we miss no important technology that could help secure the
homeland?
One year ago, U.S. officials discovered a plot to plant
explosives aboard a cargo plane leaving North Africa and bound
for America. We are fortunate that that plot was uncovered and
no lives were lost. That was not high technology. But the
question of how that managed to go through and penetrate
security is a question for the type of sophisticated technology
we should be looking at.
The anniversary of this al-Qaeda-inspired plot should
remind us that this Nation's security depends upon our
willingness to find and fix known security vulnerabilities
before they occur. Our adversary's determination to exploit
security vulnerabilities must be met and exceeded by our
determination to fill the gaps. The challenge of mitigating
threats can only be accomplished by our refusal to settle for
the status quo.
We must continually improve our security policies, develop
and explore innovative security technologies, take the
necessary steps to increase our security posture, and a
sentence that I will repeat again, we must open the door for
small businesses to access and provide exposure to their
technology.
To that end, policy should not undermine the ability of the
Department to procure cutting-edge technologies developed by
small, innovative firms. Having said that, I would caution that
the Department must be prudent in its approach to testing,
evaluating, and approving innovative security technology. As we
saw with the purchase and deployment of the puffer machines
under the previous administration, the failure to exercise due
diligence in tests and evaluating innovative technologies
before purchase can lead to wasted tax dollars. In these tight
budgetary times, the Department must have a clear vision.
I look forward to working with the Chairman, the Chairman
of the full committee, the Ranking Member of the full committee
as we open the doors of opportunity but yet have as our No. 1
criteria our commitment to the safety and security of the
American people. We can do both. We can walk down that journey
together, jobs, technology, security of the American people all
intertwined, all No. 1.
As it says in Proverbs, where there is no vision, the
people perish. I believe the Department of Homeland Security
tragically came out of an enormous and deeply despairing time
during the history of America. But we have generated great
employees, agencies that have come under one head, and
certainly under the leadership of Secretary Napolitano there is
vision. I, however, want to see that vision impacted, Mr.
Chairman, as we work together to not deny technology but as
well to be able to ensure that those doors are open.
That is why I was proud to support the amendment my
colleague from Illinois, Mr. Davis, offered during committee
consideration of the DHS authorization bill. His amendment
would have established an Office of Public-Private Partnership
within the S&T Directorate responsible for enhancing the
Department's collaboration in the area of security technologies
with stakeholders, including small businesses. Unfortunately,
this amendment was defeated. I hope we can turn it around
again.
Turning to my panel of witnesses, I am pleased that we have
witnesses before us today who are current officials of the
Department of Homeland Security. We look forward to your
insight.
In particular, I look forward to hearing from Mr. Edwards,
the Acting Inspector General, because we want to do what is
right. I am delighted to be able to hear from those who are
involved every day in procurement.
I am also eager, as I indicated, to hear from Dr. Nayak as
the new Chief Procurement Officer. Congratulations. I look
forward to learning of your challenges and how you are involved
in this effort.
I look forward to hearing from Mr. Benda on the potential
impact that the cuts contained in the House-passed Republican
Homeland Security appropriations would have on the S&T
Directorate.
During the 111th Congress it has been certainly my
challenge as the former Chairwoman to be delighted that this
committee conducted oversight, held hearings, and saw that the
House passed legislation addressing the development,
procurement, and deployment of innovative security
technologies.
Let's work together, Mr. Chairman, and go forward with a
vision helping to expand opportunities for America and securing
the homeland.
With that, I yield back.
Mr. Rogers. I thank the gentlelady.
We have been called for votes. We have got about 5 minutes
to get over there. Fortunately, there are only going to be two
votes, so we should be back in 20 minutes. I apologize, but
they didn't ask me.
So we are in recess until we can get back from votes.
[Recess.]
Mr. Rogers. I will call the hearing back to order and again
apologize for the interruption, but I don't think we will have
another one before this is over with.
Mr. Benda, you are up. We look forward to hearing your
testimony.
STATEMENT OF PAUL BENDA, CHIEF OF STAFF, DIRECTOR, HOMELAND
SECURITY ADVANCED RESEARCH PROJECTS AGENCY, U.S. DEPARTMENT OF
HOMELAND SECURITY, ACCOMPANIED BY SUSAN HALLOWELL, DIRECTOR,
TRANSPORTATION SECURITY LABORATORY
Mr. Benda. Great. Thank you, Mr. Chairman Rogers, Members
of the committee.
I appreciate the opportunity to come before you today to
talk about the Science and Technology Directorate and its role
in the technology development and acquisition process. I would
like to lay out for you how we plan on operating S&T in the
future, especially in these constrained budget environments;
and there are three areas in particular I would like to
highlight.
One, as S&T investment technologies, we are going to focus
our investments on transitioning products to use. This is
something we haven't done as well in the past as we would like,
and this is going to be an effort for us moving forward.
We are going to do this by looking at how the components do
their work, look at their operations, look at where their
bottlenecks occur, look at how they currently do things, and we
are going to identify areas where technologies can make them
more efficient. We are going to look at ways we can leverage
our technical innovation, from large companies, from small, and
ways to improve their processes and make them more efficient.
We think this will create a pull from the components for them
to want the technologies that we are deploying, and we have to
work with our component partners to make sure that we are
developing things they are interested in.
Second, we understand the challenges that S&T faces trying
to solve the problems of the Homeland Security enterprise. This
mission space is too large for one R&D entity to solve all
these challenges, so we are going to do what we like to call
forage for technologies that exist out there and forage for
partners to help us achieve these technical innovations that we
are looking for.
When I talk about that, I mean working with the
interagency, working with the Department of Defense and look at
what technologies they are developing and how can we leverage
it. Work with our international partners to see what areas they
are interested in. They face a lot of the same challenges. How
can we leverage the technology that they are doing? Work with
our university partners, Auburn University being a perfect
example, Mr. Chairman, of some of the innovation that is going
on there.
We hope to bring to bear things such as DOD's investment in
a $25 million basic research program called Compressed Sensing
that we think can be the baseline for our next-generation
automatic target recognition program that we hope to transition
to TSA.
We are looking at things such as working with the
intelligence community on a new broad-spectrum IR laser that
would allow us to do standoff explosives detection in a time
line that is relative to mass transit. We are actually
leveraging an intelligence community investment one-for-one
dollars, so they are sharing half the cost with this
investment.
Third, we have to ensure that we leverage S&T's technical
core for the use of the Department. We have got a mandate to
focus on operational test and evaluation, the back end of the
process, and I think we have done a great job of implementing
that, and I think it is a very positive development for the
Department as a whole to have a standardized OT&E process.
But we need to leverage the technical capabilities that S&T
brings to bear on the front end of the process. How do the
components set their requirements? Can we assure that they are
technically achievable? Are we not reaching for a brass ring
that might be beyond our reach? So working in partnership with
the components to achieve that.
One key component of our test and evaluation, especially in
the context of this hearing, is the Transportation Security
Lab. S&T has developed a very strong partnership over the last
couple of years with TSA, and TSL is a key component of that.
They perform the qualification and certification testing for
all the explosive detection technologies that TSA deploys.
We work very closely with them and have worked to improve
our processes to ensure that this is friendly to vendors,
friendly to industry, but also provides a robust test
environment so that nothing gets deployed before it is
technically capable of achieving the mission needs as defined
by TSA in the field.
We have worked with TSA to develop an R&D strategy focused
on aviation security that Mr. Kane had referenced in his
testimony that was published in March 2011. In August 2011, we
created a publicly releasable version of that testimony. We
think we need to leverage not just with the interagency agency
and our international partners but also with industry, and the
best way to do that is for industry to know where we want to
go.
So this R&D strategy that we have we think is extremely
important to get out there so they can see the priority
investment areas for S&T as well as for TSA, and we are going
to expand this. We are going to do a mapping of how TSA does
operations, look at where technology can improve that mapping,
and then create what we call an integrated support strategy
document for TSA. We are going to prepare this in conjunction
with my partner Robin over at TSA and then hopefully come up
with a document that both Administrator Pistole and Dr. O'Toole
can sign showing the investment and priorities for S&T and TSA
into the future and make that public so industry can see where
we are going.
In closing, I would like to say that S&T does face some
significant challenges. We think we have identified a good path
forward where we can leverage interagency and commercial
partners. We think we have established good relationships with
our component partners.
But the challenge we face is that in fiscal year 2011 our
budget was cut 19 percent during the CR. In fiscal year 2012,
the House-approved budget cut our budget by 77 percent, if you
focus on our core R&D investments. If this comes to pass, we
obviously have to scale back significantly our investments in
technology. We will have to stop our cybersecurity research,
which has won awards. We will have to stop our investment in
small businesses. We will go from 60 CIBER awards down to four.
We will have to stop our investment in biodefense research
areas.
So this will be a challenge as we move forward, and it will
not allow us to invest in the requirement setting and testing/
evaluation process. We hope that this budget gets reconsidered,
and I look forward to handling any of your questions you have
for the future.
Thank you.
Mr. Rogers. Thank you very much, Mr. Benda.
Mr. Edwards, I look forward to your opening statement.
STATEMENT OF CHARLES K. EDWARDS, ACTING INSPECTOR GENERAL, U.S.
DEPARTMENT OF HOMELAND SECURITY
Mr. Edwards. Good afternoon, Chairman Rogers, Ranking
Member Jackson Lee, and distinguished Members of the
subcommittee. I am Charles Edwards, Acting Inspector General
for the Department of Homeland Security. Thank you for inviting
me to testify about procurement policies at the Transportation
Security Administration.
My testimony today will focus on two audit reports that my
office completed this year: DHS's oversight of component
acquisition programs and DHS's Department-wide management of
detection equipment. While neither of these reports focused
solely on TSA procurement, the findings and recommendations in
both are relevant to the subcommittee's discussion today.
The Department oversees acquisition programs at or about
$300 million in life-cycle cost. Individual components such as
TSA are responsible for the oversight and controls for
acquisition programs below the $300 million threshold.
We have reviewed 17 DHS acquisition programs, including
eight programs at TSA, to determine whether the Department has
established adequate management and oversight controls. We
concluded that, while DHS generally had management oversight
and controls in place, it needs to further define policies and
strengthen oversight.
We identified two areas for improvement: Clearer guidance
and mandated use of available tools. We found that many
components needed clearer guidance for determining when an
acquisition was costly and complicated enough to be managed as
an acquisition program or when the acquisition could be handled
as a simple procurement.
For example, TSA personnel reported that they classified
all acquisitions that appeared to be programs as acquisition
programs because the Department's guidance was unclear. We
recommended that the Department create a decision matrix tool
that the components can apply in pre-planning phases of the
purchasing process in order to reduce this confusion. The
Department concurred with our recommendation and agreed to
develop a decision matrix.
Another area where the Department can improve its oversight
of acquisition programs is by mandating that components use the
acquisition tools available to them. For example, the
Department has created a Strategic Sourcing Program Office, or
SSPO, to help components engage in market research, identify
best practices, minimize duplication of effort, and provide
Department-wide contract vehicles.
Unfortunately, we found during our review that the
Department was not ensuring or mandating that components use
the SSPO when managing acquisition programs. We recommended
that the Department make sure component personnel are at least
considering the use of SSPO during the planning stages of their
acquisitions. The Department agreed with this recommendation.
The issue of strategic sourcing came up again during the
second audit that I will discuss today, our audit of
Department-wide management of detection equipment. Detection
equipment includes metal detectors, explosive detection
systems, and radiation detectors. For fiscal year 2010, DHS
components had a combined inventory of detection equipment of
more than $3.2 billion. TSA'S share of the equipment accounts
for about two-thirds of that inventory.
While DHS has applied strategic sourcing strategies for
many common-use items such as firearms, ammunition, and office
supplies, the Department is not using strategic sourcing to
manage its purchase of detection equipment. Thus, we
recommended that the Department establish a commodity council
for detection equipment that can strategically source these
items. Commodity councils are a crucial element of developing
an effective Strategic Sourcing Program, including
representatives across the organization who act as subject
matter experts in the acquisition process.
Generally, the component purchasing the largest quantity of
a particular item takes the lead role in acquiring the
commodity or service and may serve as the commodity's single
item manager. Other Federal agencies such as DOD use the
Commodity Council concept and DHS itself has created the
Commodity Council to manage its acquisitions of weapons and
ammunition. The Department agreed that an analysis of potential
strategic sourcing for detection equipment is warranted.
In conclusion, the Department has made considerable
progress in establishing its acquisition management practices
and procedures through improved guidance to the components and
increased use of tools like strategic sourcing. The Department
and its components, such as TSA, will continue to improve its
acquisition processes.
Chairman Rogers, this concludes my prepared remarks.
I would be happy to answer any questions that you or other
Members may have.
[The statement of Mr. Edwards follows:]
Prepared Statement of Charles K. Edwards
November 3, 2011
Good morning Chairman Rogers, Ranking Member Jackson Lee, and
distinguished Members of the subcommittee: I am Charles K. Edwards,
Acting Inspector General of the Department of Homeland Security (DHS).
Thank you for inviting me to testify today about improvements that can
be made to the procurement and acquisition practices at DHS and
specifically at the Transportation Security Administration (TSA).
As you know, the DHS Office of Inspector General (OIG) was
established in January 2003 by the Homeland Security Act of 2002, which
amended the Inspector General Act of 1978. The DHS OIG seeks to promote
economy, efficiency, and effectiveness in DHS programs and operations
and reports directly to both the DHS Secretary and the Congress. We
fulfill our mission primarily by issuing audit, inspection, and
investigative reports that include recommendations for corrective
action, and by referring cases to the United States Attorney General
for prosecution.
I am pleased to have the opportunity to testify about two of our
audit reports today. I will describe some of the serious challenges
facing DHS in acquisition management and address some improvements the
Department can make in the oversight of components' acquisition
programs. I will also offer some recommendations regarding the
Department's acquisition of detection equipment.
background
Acquisitions consume a significant part of the DHS' annual budget
and are fundamental to the Department's ability to accomplish its
mission. In fiscal year 2010, DHS awarded over $13 billion for more
than 88,000 procurement actions. TSA's budget authority for fiscal year
2010 was over $7.5 billion.
The Under Secretary for Management (USM) is responsible for the
overall DHS acquisition process. As the Department's Chief Acquisition
Officer, the USM is responsible for managing, administering, and
overseeing the Department's acquisition policies and procedures. The
USM delegates the responsibility for effective Department-wide
procurement policies and procedures, including procurement integrity,
to the Chief Procurement Officer (CPO). The Office of the CPO (OCPO) is
responsible for oversight of most DHS acquisition activities and
services, including management, administration, and strategic sourcing.
OCPO responsibilities also include developing and publishing
Department-wide acquisition regulations, directives, policies, and
procedures.
Recognizing the continued increase in the quantity and complexity
of DHS acquisitions, in November 2008 the USM classified acquisitions
into three levels to define the extent and scope of required project
and program management and the specific official who serves as the
Acquisition Decision Authority. For level 1 acquisitions (greater than
or equal to $1 billion), the Acquisition Decision Authority is the
Deputy Secretary or Under Secretary for Management. Level 2
acquisitions (between $300 million and $1 billion) are normally
overseen by the USM or the Deputy USM and are potentially delegable to
Component Acquisition Executives. For level 3 acquisitions (less than
$300 million), the Acquisition Decision Authority is the component
head. Thus, the Department oversees acquisition programs at or above
$300 million in life-cycle cost. Individual components such as TSA are
responsible for the oversight and controls for acquisition programs
below the $300 million threshold.
On May 26, 2010, the USM issued the Department's latest Major
Acquisition Oversight List. The list identified 86 major acquisition
programs, projects, and services requiring direct Departmental
oversight. TSA had seven level 1 and five level 2 acquisition programs
on that list. These programs included:
Information Technology Infrastructure Program (Level 1)
Transportation Worker Identification Credentialing (Level 1)
Electronic Baggage Screening Program (Level 1)
HRAccess (Level 1)
Passenger Screening Program (Level 1)
Screening Partnership Program (Level 1)
Secure Flight (Level 1)
Field Real Estate Management (Level 2)
National Explosives Detection Canine Team Program (K9)
(Level 2)
Security Technology Integrated Program (Level 2)
Specialized Training (Level 2)
TTAC Infrastructure Modernization Program (Level 2)
additional dhs oversight needed for component acquisition
While the Department has taken steps to improve its acquisition
oversight processes and controls, our report OIG-11-71, DHS Oversight
of Component Acquisition Programs (April 2011) identified additional
areas for improvement. We made four recommendations to the CPO to
strengthen the Department's management oversight and controls over
component acquisition programs. The CPO agreed with our recommendations
and initiated corrective actions.
Our report DHS Oversight of Component Acquisition Programs resulted
from an audit that was designed to determine whether the Department
established adequate management oversight and controls over component
acquisition programs. As part of this audit, we reviewed 17 DHS
acquisition programs, including 8 programs at TSA. The following TSA
acquisition programs were included in our review:
Screening Partnership Program (Level 1)
TTAC Infrastructure Modernization (Level 2)
National Explosives Detection Canine Team Program (Level 2)
HAZMAT Threat Assessment Program (Level 3)
Freedom Center (formerly Trans Security Ops Center) (Level
3)
Performance and Results Information System (Level 3)
Consolidated Screening Gateway (Level 3)
Intermodal Security Training Exercise Program (Level 3)
Our report recognized that the Department has made improvements to
its acquisition oversight processes and controls through implementation
of a revised acquisition management directive. However, the Department
needs to provide additional detailed guidance and improve controls in
some areas. The Department has neither fully defined an acquisition
program for its components, nor developed consistent guidance for
reporting acquisitions in its standard system. In addition, the
Department has not ensured that components are using all acquisition
tools available and that they have adequate policies and procedures in
place to manage acquisition programs.
As a result, components created program management offices to
manage simple procurements, incurring unnecessary administrative
program costs without adding value to the programs. Additionally,
without adequate controls in place, the Department did not have
complete visibility of all programs within its acquisition portfolio.
unclear guidance
The Department has not fully defined when a component should manage
an acquisition under the requirements of the Acquisition Lifecycle
Framework or manage it as a simple procurement. We found that many
components were committed to following the Department's guidance but
needed more structure for determining when to establish a program to
acquire a product or service. We requested a list of all programs from
each component and received numerous questions and conflicting
responses. For example, TSA personnel reported that they classified all
acquisitions that appeared to be programs as acquisition programs
because the definition was unclear.
Directive 102-01, which prescribes guidance over the Acquisition
Review Process, Acquisition Lifecycle Framework, and Acquisition Review
Board, establishes the overall policy and structure for acquisition
management within the Department. But the directive does not provide a
decision-making tool to determine if an acquisition warrants the higher
level of internal controls required by the Acquisition Lifecycle
Framework. The supplemental Acquisition Instruction/Guidebook 102-01-
001 (Guidebook) provides detailed instructions on implementing and
managing acquisitions, but also does not provide clear instruction for
determining if an acquisition should become an acquisition program, and
in attempts to comply with the directive, components over-classified
programs.
We reviewed several acquisition programs that do not clearly fit
into the Acquisition Lifecycle Framework process. Ten of the 17 (59%)
programs we reviewed, with an estimated life-cycle cost of about $5.3
billion, were acquisitions that identified commercial-off-the-shelf
equipment or existing contracts to fulfill the needs identified by the
program office. Component personnel likely could have managed these as
simple procurements rather than acquisition programs. For example, the
TSA classified renovation of an existing warehouse building as an
acquisition program. It leased the 104,000-square-foot building in 2003
and renovated approximately 89,000 square feet for about $42 million
over the initial 10-year leasing period. In 2008, TSA primarily relied
on existing contracts to complete 12,500 of the remaining 15,000 square
feet of the warehouse building. According to TSA personnel, the
renovation for the additional 12,500 square feet cost about $2.5
million, with construction completed in January 2010. For this small
renovation project, TSA personnel could have used simple procurement
rules but instead increased administrative costs by implementing the
more complicated internal control structure prescribed in Directive
102-01.
Based on the definition of an acquisition program in the Guidebook,
this renovation could possibly be an acquisition program. However,
based on the processes and procedures laid out in Directive 102-01's
Acquisition Lifecycle Framework and Acquisition Review Process, this
renovation does not meet the intentions of the existing guidance or
present a high enough level of risk to warrant the increased costs of
being managed as a program.
Components should not create acquisition programs for acquiring
products and services that are outside the intent and spirit of
Directive 102-01. The Department can reduce some of the conflicts at
the component level by developing a decision matrix that the components
can apply in the pre-planning phases of the purchasing process.
use of available tools
The Department developed inconsistent reporting requirements for
components to follow when reporting an acquisition's progress in nPRS,
the Department's standard reporting system. nPRS is an integrated
system that provides DHS headquarters visibility of components' level
1, 2, and 3 acquisition investments. It can also store working and
approved key acquisition documents, earned value management
information, and risk identification. Component personnel are
responsible for entering and updating information regarding their
acquisition programs in nPRS. This information includes, but is not
limited to, cost, budget, performance, and schedule data.
Since nPRS became operational in 2008, the Department has issued
conflicting guidance and enforcement for reporting level 1, 2, and 3
acquisition programs. Moreover, the Department has not ensured or
mandated that components use nPRS, which would provide transparency and
efficiency of component acquisition programs. Because the Department
has not consistently mandated use of nPRS, component personnel have
developed, or are in the process of developing, their own data-tracking
systems.
For example, TSA hired and spent approximately $100,000 for a
contractor in 2005 to develop the TSA Acquisition Program Status
Report, which served as its data-tracking system. As of June 2010, TSA
had merged its acquisition program portfolio, levels 1, 2, and 3, into
nPRS and will no longer use the TSA Acquisition Program Status Report.
As of August 2010, nPRS is TSA's official tracking system for
acquisition programs.
The Department has also not ensured that the components use the
Strategic Sourcing Program Office (SSPO) when managing acquisition
programs. According to a 2005 memorandum from the Office of Management
and Budget:
``Strategic sourcing is the collaborative and structured process of
critically analyzing an organization's spending and using this
information to make business decisions about acquiring commodities and
services more effectively and efficiently. This process helps agencies
optimize performance, minimize price, increase achievement of socio-
economic acquisition goals, evaluate total life-cycle management costs,
improve vendor access to business opportunities, and otherwise increase
the value of each dollar spent.''\1\
---------------------------------------------------------------------------
\1\ Office of Management and Budget memorandum to Chief Acquisition
Officers, Implementing Strategic Sourcing (May 20, 2005).
The Department created the SSPO to help components identify best
prices available for a requirement, engage in market research to
identify the best available vendors and manufacturers, minimize
duplication of effort for market research, and provide Department-wide
contract vehicles. Because the current guidance is silent regarding the
use of the SSPO, the Department may be incurring increased cost for
component procurements. In addition, components may be conducting
duplicative market research for procurements that the SSPO has
performed. The Department should make sure that personnel at TSA and
other components are at least considering the use of the SSPO during
the planning stages of their acquisition programs.
department-wide management of detection equipment
Our recent audit report, OIG-11-47, DHS Department-wide Management
of Detection Equipment (March 2011), highlighted some of the
acquisition challenges facing the Department when multiple components
have similar requirements or are buying the same type of equipment. We
identified steps the Department can take to improve its acquisition
processes. With improved management, DHS can streamline the acquisition
process, improve efficiencies, and provide uniform equipment inventory
information.
DHS has eight different procurement offices that purchase detection
equipment. Seven of these offices are at the component level, and each
has its own head of contracting. These components are as follows:
United States Customs and Border Protection
Federal Emergency Management Agency
Federal Law Enforcement Training Center
United States Immigration and Customs Enforcement
Office of Procurement Operations \2\
---------------------------------------------------------------------------
\2\ In 2004, the Department created the Office of Procurement
Operations to provide acquisition services to components that did not
have a procurement office.
---------------------------------------------------------------------------
Transportation Security Administration
United States Coast Guard
United States Secret Service
Components maintain separate inventories for their detection
equipment. For fiscal year 2010, the components had a combined
inventory of more than $3.2 billion worth of detection equipment, most
of which is deployed. The components purchased an average of about $387
million worth of detection equipment in each of the last 3 years,
ranging from about $280 million to $511 million. This equipment
includes metal detectors, explosive detection systems, and radiation
detectors (including some personal protective safety equipment) for
screening people, baggage, and cargo at airports, seaports, and land
ports of entry, as well as Federal buildings. As of March 1, 2010,
TSA's detection equipment accounted for 66% of the Department's total
inventory.
Our audit work showed that DHS can better manage the acquisition of
detection equipment by developing processes based on best practices
such as strategic sourcing.
strategic sourcing
As discussed above, DHS has established a Strategic Sourcing
Program and has applied strategic sourcing strategies for many common
use items, such as firearms, ammunition, and office supplies; however,
the Department is not managing its detection equipment through this
program. According to DHS officials, components are encouraged but not
required to use the Strategic Sourcing Program and generally do not
coordinate and communicate when acquiring detection equipment. There is
no mechanism in place for components to standardize equipment purchases
or identify common mission requirements among components. For example,
the Department's Joint Requirements Council is inactive, and components
do not have the expertise of commodity councils or single-item managers
to rely on when acquiring detection equipment. Further, components view
detection equipment as unique to their missions and do not attempt to
identify common mission requirements among other components. This
results in numerous inefficient purchases by individual components
instead of consolidated purchases.
standardizing equipment purchases
Some components did not standardize equipment purchases and
purchased a variety of different detection equipment models. For
example, United States Citizenship and Immigration Services (USCIS) has
24 and CBP has 21 different models of small X-ray equipment, and CBP
and USCIS each have 14 different models of walk-through metal
detectors. When components have multiple models of equipment to meet
similar missions, DHS incurs higher procurement administrative costs
and logistic support costs for maintenance, training, and support. In
contrast, TSA, which uses and maintains the largest inventory of
detection equipment in the Department, uses only seven different models
of small X-ray equipment and three models of walk-through metal
detectors. By limiting the number of models and types of equipment, TSA
is in a position to increase efficiencies in procurement, maintenance,
and personnel flexibilities.
common mission requirements
We identified about $170 million worth of small X-ray machines,
metal detectors, and personal and hand-held radiation detectors that
DHS could acquire through strategic sourcing strategies. Although
multiple components were using similar equipment to meet similar
screening missions, each component purchased the equipment separately.
Components did not coordinate with each other to identify common
requirements, consolidate purchases to gain buying power, or
consolidate logistic support requirements.
DHS Management Directive 1405 established a Joint Requirements
Council (JRC) as a senior-level requirements review board to identify
cross-cutting opportunities and common requirements among DHS
organizational elements for non-information technology investments. The
JRC met periodically between fiscal years 2004 and 2006.
Representatives on the JRC reviewed programs and processes for
potential mission overlap and redundancies. Among the programs reviewed
were TSA's Secure Flight and Registered Traveler and CBP's Consolidated
Registered Traveler programs. In 2006, the JRC stopped meeting after
the Department assigned the council chair to other duties. However, DHS
now recognizes the importance of the JRC and indicated that it might
revive the council or pursue another alternative to identify duplicate
programs and processes across the Department. This undertaking should
include an effort to identify common data elements and nomenclature
within inventories and to establish a data dictionary for the
Department's detection equipment.
In addition to the JRC, commodity councils are an integral element
of developing an effective strategic sourcing program. Commodity
councils include representatives from across the organization. The
members act as the subject matter experts in the acquisition process
and in establishing requirements for a specific commodity or service.
Generally, the component purchasing the largest quantity of a
particular item takes the lead role in acquiring the commodity or
service and may serve as that commodity's single-item manager.
DHS and other Federal agencies use the commodity council concept.
For example, in 2003, DHS established the Weapons and Ammunition
Commodity Council to create a Department-wide strategy for
consolidating requirements and gaining economies of scale for the
acquisition of weapons and ammunition. The council, which includes
representatives from each component that uses weapons, developed
requirements for firearms, ammunition, and body armor. ICE took the
lead role, using service-level agreements with other components to
establish one overall contract, which is available to all DHS entities.
The Department has agreed in principle with our two
recommendations, and is taking action to implement the recommendations.
DHS is evaluating reestablishing the Joint Requirements Council and
other alternatives to achieve the same goal. It will perform a business
case analysis of detection equipment and establish a commodity council
or working group if it determines that this equipment can be
strategically sourced.
conclusion
Though DHS was established by combining 22 agencies with different
legacy systems, missions, and cultures, it has made considerable
strides in establishing its acquisition management practices and
procedures. It has established oversight policies, clarified roles and
responsibilities for acquisition, and worked to address staff
shortages. It needs to continue improvements that affect its cohesion
as a Department and its bottom line. Increased use of such tools as
strategic sourcing and a commonly-applied definition of an acquisition
program will help the components such as TSA and will result in more
cost-effective and efficient acquisitions.
Mr. Chairman, this concludes my prepared statement. Thank you for
the opportunity to testify and I welcome any questions from you or
Members of the subcommittee.
Mr. Rogers. Thank you. Great. Thank you very much.
I will start off on the questions.
Dr. Nayak, what is the one thing that DHS could do
differently in engaging with the private sector that would have
the largest impact on industry's ability to better support
Homeland Security, in your view?
Mr. Nayak. That is a great question. I don't think there is
any one particular thing, but let me give you one, and let me
also just add the entire list, because you really have to do a
number of things.
When we talk about industry, we are talking about everybody
that is out there, as you well know, and being open and
transparent in communicating with them. So one of the things
that we can do is specific industry days around procurements
have to be done better. You can't have one-way communication.
You have to have two-way communication. You have to sit there
and you have to wait for every question from everybody who
participates in that industry. That is one.
You obviously know RFIs. We need to increase the number of
RFIs that we use, increase the number of draft RPs. It is a
little challenging sometimes in general because of the way we
get our money and funding. For instance, in the last fiscal
year, we had to spend $10 billion in the last 5 months of the
fiscal year.
But a couple other things that I am doing that are new. One
is we have created an industry liaison in every component. So
we have got an on-line forecasting system of procurements in
advance. Industry sees it. They call up. They get a program
manager. Now we have a belly button that they can actually go
to a live person to really find out what is the status of that.
Mr. Rogers. Let me go back to your industry days--because
you talked about that in your opening statement, too--about the
revisions you are going to make in it. Two questions I have.
One is: What is your time line for seeing that new and
improved industry days program implemented? Then, second, you
have talked about how different the industry segments are, and
you are right. When you are interacting with Lockheed or
Boeing, it is not the same as a small hub-zone company that you
deal with. So in these industry days, will you do those
separately? Like will you have an industry day for small
businesses separate and apart from the one with the big guys,
or do you do them all at once?
Mr. Nayak. Okay, so great question. Let me address the
first point first, what are we doing different in terms of
industry days themselves and when is the time line.
The time line is immediate. I have already issued an
acquisition alert that essentially gives everybody across DHS
direction. We have got to do these things well. But those are
the ones around specific procurements.
Outside of that, we have got to have a mechanism to talk to
industry at large about capabilities, outside and away from
procurements, so that we can have continuing dialogue. That is
something that some people will classify as an industry
advisory council.
Sometimes when you hear ``industry advisory council'' you
only think large business and you don't think small business.
So what we have got to do, the nut we have to crack, is to
figure out how to do this in a transparent way working with the
private sector. So that is one big thing that will make a huge
difference moving forward.
The last thing I want to mention, and it is something new,
it is something that we heard from industry, is to have reverse
industry days. So often when we have industry days, we are
communicating to industry. By the way, it is both large and
small business, anybody who wants to come in. But a reverse
industry day would be where we say here is the capability.
Industry can come in and talk to us about the capability. We
can get a little bit smarter, again, away from procurements
where things get extremely sensitive.
Mr. Rogers. That is what our industry panel talked about.
They would like to see more of that dialogue, more of a skull
session.
I serve on the Armed Services Committee as well. One of the
things the DOD will do is bring in industry and say: Here is
the problem we got, and we are trying to figure out how to meet
this problem. What are your thoughts? Everybody just kind of
thinks out of the box in that session, and they go back and
they work on it, too.
That is the kind of dialogue I am hoping to see developed
in DHS so that it is more of a partnership in trying to solve
problems.
Mr. Nayak. So that is what you are going to see moving
forward.
Mr. Rogers. That is great.
Mr. Nayak. One more point, and that is on small business.
We connect with small business. Every communication in industry
days is open to everybody, but we do have specific and unique
events for small business. We participate in over 100 outreach
events, and then we have 10 separate vendor outreach segments
where we meet one-on-one with companies. So across the board--
--
In a previous hearing you had a gentleman here from CSIS, I
believe, testify. Obviously we contract to support the mission,
but it is also neat to know that our business is spread pretty
evenly amongst large, medium, and small business.
Mr. Rogers. That is great.
Mr. Kane, you made reference to some new scanning system
that you are going to be implementing pretty soon that will be
able to determine or detect fraudulent ID. How will that work?
Mr. Kane. Mr. Chairman, we call it--it has a long name--the
credential authentication technology and boarding pass scanner
system. So when you come up today you walk up to the travel
document checker at the checkpoint, and they typically have a
light and a loupe that they are going to look at those
documents.
This is technology that will read credentials such as your
driver's license, such as a passport, which is the two most
common you will see at a checkpoint. Then it will say, yes,
this is a valid Virginia State driver's license and it has all
the characteristics that a Virginia State driver's license has.
It is going to look at that boarding pass and say, yes, this is
a valid boarding pass and the name matches between these two
documents. So the two documents match each other, and it is a
valid boarding pass for that day. So that gets away from a lot
of the manual errors that can be made.
Mr. Rogers. Will there have to be a handler involved, a
person, or will they just go up to a kiosk?
Mr. Kane. Right now, there will still be that travel
document checker in the process right now. It will be a little
more automated in that the passenger will put their boarding
pass up, but the officer will actually handle the credential.
Mr. Rogers. Excellent.
My time has expired. I now yield to the Ranking Member, Ms.
Jackson Lee, for any questions she may have.
Ms. Jackson Lee. Mr. Chairman, thank you very much.
Let me also acknowledge the presence of Mr. Davis of
Illinois. I know you have acknowledged the distinguished
gentleman, Mr. Turner, I think and Mr. Cravaack for their
presence here today.
I want to pose a question. Mr. Edwards, I mentioned Mr.
Davis because he had offered an amendment during the DHS
authorization that would have established an Office of Public-
Private Partnerships within the S&T Directorate responsible for
enhancing the Department's collaboration area of security
technologies with stakeholders, including small businesses. I
know that part of his intent is to ensure that these
directorates work well.
So let me pose a question to you, Mr. Edwards: In crafting
for us, what is the most critical problem with the relationship
between TSA, the Department of Homeland Security, DHS, S&T, and
DHS Office of Procurement, and how can lawmakers or officials
at the Department address it?
Mr. Edwards. Thank you, ma'am.
S&T tests a variety of technologies, including systems made
up from a number of technologies. S&T provides test information
along with its recommendations for best models to TSA and other
components. TSA and other operational components make the
product selection and procurement decisions and are not
required to follow S&T's recommendations on products.
Also, you know, if you use S&T in a similar way as their
sitting role in the Acquisitions Review Board, rather than
having them review during the acquisition process, if there is
a decision memorandum that leverages S&T's technical expertise
prior to the acquisition process, it can potentially save lots
of dollars and time.
Ms. Jackson Lee. If there is a--I am sorry?
Mr. Edwards. There should be a decision memorandum from S&T
giving their technical expertise and their opinion ahead of--
before the processes get started. That would really go a long
ways.
Ms. Jackson Lee. So information goes a long way if the
memorandum exists that can either be passed from whether it is
DHS, TSA. Of course, you indicated they don't have to accept
the recommendation or the information--they can accept the
information, not the recommendation. That is a document that we
can track and we can utilize for, I think, informed decisions.
Mr. Edwards. Absolutely.
Ms. Jackson Lee. I think that is an important way of
coordinating. More communication I assume would--and I don't
want to call it forced communication, but should there be some
structure that puts in a mechanism for required communication?
Is that----
Mr. Edwards. Absolutely. I quite agree with you.
Ms. Jackson Lee. Dr. Nayak, thank you, and let me welcome
you to the position. I understand you have been here about a
year.
Let me do one question that might seem as if I am asking
you for a 3-hour presentation, but I am not because, I have a
follow-up question.
What is your vision for the procurement area for DHS?
I heard in another hearing someone making a statement that
the Federal Government buys things, needs things, and utilizes
products; and many times small, medium, and large businesses
are either rebuffed or confused about how to access providing
their product to the Federal Government. So, quickly, what is
your vision?
That is my first question. I am going to put them both
together. That may be two or three sentences in what you want
to see happen.
But then the other part of it is we are grappling with not
only the supercommittee but the existing proposed House budget
which impacts DHS' effort to assure accountability--or how
would you think that is impacting assuring accountability--and
an acquisition workforce. This budget, how is it impacting an
acquisition workforce adequate to stimulate growth and
innovative solutions in Homeland Security technology? So what
direct impact--these proposed cuts in the DHS budget as it
relates to your area, what direct impact will it have?
So the first question is your quick vision for what you
perceive you can do and the second would be that direct impact.
Mr. Nayak. Thank you for the questions.
The vision in a nutshell is really my job as the chief
procurement officer and hovering over $14 billion to spend is I
have got to be able to prove that we are getting a good deal
for the taxpayer with all of that spend.
Specifically, I have four priorities, and those support
getting a good deal for the Government and for the taxpayer.
They are quality people. I have got to have the best people
in place. We have about 1,400 contracting people right now.
We have to do good contracting.
I mentioned strategic sourcing. Mr. Edwards mentioned
strategic sourcing, mentioned detection equipment, which we are
moving well along the way to strategically sourcing detection
equipment.
Quality program support. I have to influence the success of
the more than 500 DHS programs that are supported by contracts
that deliver quite a bit of the mission.
Ms. Jackson Lee. How many programs did you say?
Mr. Nayak. There is more than 500. There is about 82 major
programs with a life-cycle cost of over $300 million.
Then the other priority I have added as the new CPO for a
little bit more than a year is quality interaction with
industry. I mean, it is absolutely key. If we are going to
contract with industry for $14 billion, we have to talk to them
at every stage of the process. Talking to them well in advance,
all businesses of all sizes, helps us clarify requirements, and
that ultimately helps us get a better deal. So, all in all, the
vision is to get a better deal.
In terms of the budget impact and specifically in my area,
line of business, which is acquisition, it would really, really
basically set us back. I have been through this myself when I
was with the IRS. When I came into the IRS, there was a lot of
talk about not being able to modernize tax systems; and since
then, at a minimum, we have E-File.
When I got there in procurement, there were only 20 or 30
procurement people. We built it up to 500 people, and since
then they have a fairly premier procurement program.
Similarly, at DHS, if we had to sustain these cuts, here is
what pretty much would go out the window: Replenishing our
acquisition workforce, gone; program oversight over those 500
programs, gone; oversight in terms of all of our procurement
actions, 90,000 actions in nine contracting offices across the
Department, minimal at best.
The $14 billion is spread through nine contracting offices.
Two are of them report directly to me, and they account for
about $6 billion. So if my organization, which includes those
folks, are cut, you know, there may be an immediate cost
savings in the cut itself, but the long-term impact is going to
be devastating. We most likely will be back here chatting about
all kinds of stuff in terms of acquisition that we really don't
want to.
Ms. Jackson Lee. Let me just ask one quick question, if the
Chairman will yield to me for a minute.
Mr. Edwards mentioned one fix could be, in terms of
communication between TSA, DHS, and S&T, is an S&T memoranda
that you would ultimately get, Dr. Nayak, and others, so that
when some S&T product has been researched and reviewed there
would be some chain of fielding that work, that assessment to
you, to TSA, and others. In addition to I think I said maybe a
structure that would channel that document so you would
promptly get an assessment of a new technology that had been
reviewed.
Would that be helpful, Dr. Nayak? I was speaking to you. I
was saying Mr. Edwards mentioned an S&T memorandum, and I
mentioned a structure to get that memorandum to the appropriate
persons. Would that be helpful to you once a product was
reviewed?
Mr. Nayak. I think helpful to the Department, yes.
Ms. Jackson Lee. So getting a quick document to you that
assessed a product would be helpful?
Mr. Nayak. Yes.
Ms. Jackson Lee. Would be helpful in streamlining your
work, or at least assessing whether that product should be
utilized?
Mr. Nayak. Yes.
Ms. Jackson Lee. I will yield back now. Thank you.
Mr. Rogers. The Chairman is now proud to recognize our
newest Member here on the subcommittee, Mr. Turner, who has
recently been elected in New York, of all places. So we are
proud to have you and look forward to your questions for the
witnesses.
Mr. Turner. Thank you, Mr. Chairman. New York continues to
elect people. Not too many Republicans. That was the odd thing.
A question, please, for Mr. Kane. We have aging technology,
and I would like to hear what is in the pipeline, how it might
be affected by the budget realities. I am particularly
interested in the shoe technology which I find is the most
abhorrent of all the security techniques, as necessary as it
absolutely is. If you would?
Mr. Kane. Congressman, yes, sir.
We have a number of technology programs in the works right
now. You know, as TSA stood up 10 years ago, obviously we used
a lot of equipment that was in place and then we built out the
baggage screening system in a very quick time frame. So much of
that technology is nearing the end of its life, particularly
the expensive technologies, which is the baggage screening
equipment down in the baggage rooms.
We have a recapitalization strategic plan to replace that
equipment. I think what you will see us do is focus more of our
budget resources on the recapitalization effort, focused on
EDS, rather than new in-line systems in airports. With the
Recovery Act, with some of the other funding that has come our
way over the past couple of years, we have been very fortunate
to build out a number of the in-line systems or get them funded
so that the airports could build out their systems. So just the
EDS in particular, we are going to focus on the
recapitalization of those pieces of equipment.
We also, of course, have the advanced imaging technology
going into the checkpoints that replaces or sits alongside
today the walk-through metal detectors, a completely new
ability to detect nonmetallic threats. It just didn't exist
before we brought that technology to the airports.
We also are recapitalizing the X-rays, the carry-on bag X-
rays as well with the multi-view X-ray and with some ability to
have auto-detection on there for bulk explosives.
In addition, I mentioned previously the credential
authentication technology. As I described earlier, if that
proves successful in our field tests, after the beginning of
the year you would see that start to show up at every
checkpoint in the country as well.
So we are doing a lot of work. We are trying to improve
those technologies over time and have a spiral development
approach, and that is where S&T helps us quite a bit.
Then I think with the shoe scanner in particular--and it is
everyone's favorite topic a lot--we found that just a difficult
technology challenge to solve with everything that comes with a
pair of shoes in the airport environments. I think a lot of
what we are doing with our TSA PreCheck and prescreening and
identifying those travelers who we feel are very low risk to
the system and moving away from an one-size-fits-all approach
will help us solve some of the shoe issue, allowing people to
keep shoes on, for the most part, and those expedited screening
lanes will help solve some of that problem and some of the
frustration especially frequent travelers feel when they have
to do that.
Mr. Turner. Thank you. I will continue to wear slip-on
loafers until that day.
I experienced something 2 weeks ago on an international
flight that would apply to domestic, and I don't know if this
is solved through technology or procedure. One of the military
personnel traveling with me, we went through two checkpoints.
In the first checkpoint, he bought a bottle of expensive
brandy, and it was handed to him after he got through security.
Yet on the next flight we were checked again, and he was
stopped for liquid. It was poured down the drain.
That same thing may happen coming back, say, from Europe to
the States, going from international to domestic. You have a
carry-on that goes through again.
Any comment? Was that just tough luck?
Mr. Kane. I think it is understanding the systems that are
in place. So, internationally, I can't speak to all the
different regimes, although I know a lot of people will allow
the duty-free liquids onto the flights, particularly with the
secure technology, the tamper-evident bags they have over in
Europe.
We don't accept that in the United States. So when you come
into the United States you need to put that bag from your
carry-on into your checked baggage, and in virtually every case
you are going to have to recheck that bag and you have to shift
it over. If you don't understand that, you will sometimes
experience difficulties at the checkpoint.
Another technology challenge the world is obviously trying
to solve is liquids packed in bags. We haven't cracked that
yet. We are working towards it. It is another difficult
challenge, though, to be able to do that and understand
explosives in bags. On the other hand, it is a real threat. So
we have to be able to address that threat.
Mr. Turner. Thank you.
I yield.
Mr. Rogers. I thank the gentleman.
The Chairman now recognizes the gentleman, Mr. Davis, for
any questions he may have.
Mr. Davis. Thank you very much, Mr. Chairman.
Mr. Kane, during his appearance before the Senate Homeland
Security and Governmental Affairs Committee yesterday, in
response to concerns expressed by Senators Lieberman and
Collins, Administrator Pistole expressed his concern that there
is a perception that TSA's X-ray whole-body scanners are not as
safe as they could be.
I have some concerns about both the perception and the
reality of the safety of these machines. My concerns extend to
both the flying public and the Transportation Security Officers
that work in the vicinity of these machines on a daily basis,
and that is why I encourage the inclusion of language in the
TSA authorization bill that would require an independent third
party to carry out a study on the machines. I commend
subcommittee Chairman Rogers for including that language in his
bill.
In light of the bipartisan and bicameral concerns about the
safety of these machines, do you believe that an independent
third-party assessment of the safety of the machines and the
operating environment validating TSA's findings might be
helpful?
Mr. Kane. Congressman, I think we have had a number of
independent third-party assessments of the technology. Johns
Hopkins University did it. The Army's Public Health Command has
done an assessment of the machines, and they do so on a regular
basis in airports. We had an experiment with them in our lab,
but they ran it where we took over 93,000 different samples. We
are awaiting the final report on that. But it is going to show
again that they are well within the safety standards that are
set and that we set in the requirements that we published out
to industry.
Over and over again, the people we have had study this have
said the technology is safe and well within the standards that
we need to meet to be able to use that technology; and the
benefit--the security benefit that we get by being able to
detect a nonmetallic threat and maturing that type of detection
capability in the airports is substantial.
Mr. Davis. Thank you very much.
Gentlemen, let me ask you, within my Congressional
District, which includes a large part of the City of Chicago,
our average daily ridership of bus and rail combined is 1.6
million riders a day. Over 75 percent of those riders use buses
to go to work, to the grocery store, and many other places that
they use to live their lives. I have major concerns about
technology related to bus system security.
In the past year in my district, and even in Chairman
King's district, city buses were stolen and operated by non-
transit employees for hours. In Chicago, a man stole a Chicago
Transit Authority uniform, got in a bus on the south side, and
drove from 8 o'clock a.m. to midnight, and then returned the
vehicle to the garage and struck a parked bus. Fortunately,
there were no passengers. But this incident could have taken
place while he was driving the bus route.
My question is: Are there any technologies that are ready
for use or in the process of being created that you are aware
of that would specifically deal with bus safety and security?
Mr. Kane. The only one I am really aware of--and I am not
very current, I have to admit, Congressman, on where we are on
this--there are some technologies that from a remote location
you could shut down a bus. So if you knew that bus had been
taken that you could use that. The bus authority, the transit
authority could use that to shut the bus down.
Clearly, there is locator technologies that trucking
companies and shipping companies use that allow them to track
different things. So you could use that technology as well.
I know we have run some pilots on those types of
technology. I am not sure exactly where we are. We would put
something like that on our approved equipment list that would
then be able to be available for grant programs or for transit
authorities to be able to procure off that approved equipment
list. That just kind of says, hey, TSA has taken a look at this
many times with S&T. It is a good technology, and here is the
capabilities that that would have.
Mr. Davis. Are any of the rest of you familiar with
anything other than that?
Mr. Benda. Congressman, Paul Benda from S&TP.
We do have one new technology that we developed in public-
private partnership with industry which is called the Brave
Camera. One of the issues that we have seen in the past in
Israel, if you have a suicide bomber come on board a bus, if
you have any type of surveillance in place, it destroys the
camera and the recording that allows you to go back to do
forensics.
So we partnered with industry, put our requirements out,
and they used their own internal dollars to build a camera that
could meet the explosive blast and actually allow us to gather
the data off that camera rather quickly. S&T then sponsored a
test actually of getting a bus that was out of its life cycle
and blowing it up with the camera inside.
So that type of camera in place, while it is forensic, if
you had that type of camera system in place, you would monitor
it from a central location, as Mr. Kane had stated, in case an
activity went on. But if the worst did happen, you could
actually find out who that perpetrator was and learn from that
incident so it doesn't happen again.
Mr. Davis. Thank you, gentlemen, very much.
Mr. Chairman, I yield back.
Mr. Rogers. The Chairman now recognizes my colleague from--
what State is that--Minnesota, for 5 minutes.
Mr. Cravaack. God's country, sir. God's country.
I thank the panel for being here today. I appreciate it
very much. Thank you for coming here and enlightening us.
I did have a quick question, Dr. Nayak. Could you tell me a
little bit, do you know how many--it is my understanding we
have purchased 700 AT carry-on baggage X-ray devices, is that
correct?
Mr. Nayak. I am going to have to defer to Robin.
Robin, do you have an answer to that?
Mr. Kane. Yes, sir. The last procurement we made was
slightly over 700. We, prior to that, had around 900 in the
field. So the total is near 1,600.
Mr. Cravaack. So you have purchased around 1,600 machines.
Okay. All right.
What is the total--I hope I will be able to get a group
consensus here. What is the total cost per unit of these AT-2
machines? Do you know?
Mr. Kane. In round numbers, it is around $150,000.
Mr. Cravaack. Per unit?
Mr. Kane. Yes, sir.
Mr. Cravaack. Are these devices being used at any current
TSA airports right now?
Mr. Kane. Yes, Congressman. We have at least 950 in the
field, and a number of the 700 are also out into the field.
Mr. Cravaack. So you have about 950 in the field and you
purchased about 1,600, is that correct?
Mr. Kane. That is correct.
Mr. Cravaack. Is there any that are being stored or
warehoused in Dallas, Texas, right now?
Mr. Kane. Yes. We have some still remaining in the
warehouse down in Dallas.
Mr. Cravaack. Do you know how many those are?
Mr. Kane. It would be whatever we have not deployed of the
700, but it is probably over 600.
Mr. Cravaack. Okay. Do you know what the cost of
warehousing these are?
Mr. Kane. I don't have the specific cost for that. We pay--
I would have to get you the number for the record, Congressman,
in terms of what we pay for our overall warehousing.
Mr. Cravaack. Okay. Could you do that by November 10? Would
that be a possibility?
Mr. Kane. I could certainly work through our folks to be
able to provide that.
Mr. Cravaack. Okay, great.
I want to turn a little bit to the puffer machines, if I
could. Has the TSA destroyed all its collection of the puffer
machines at this time?
Mr. Kane. We disposed of all of those. We don't destroy
them. We turn them over to the Defense Reutilization Office,
and they dispose of them or reuse them. I suspect most of them
have been disposed of. I don't know that for certain.
Mr. Cravaack. Do you know what the cost is for the
destruction of each machine?
Mr. Kane. I don't.
Mr. Cravaack. Okay. All right. Then you are probably not
going to be answering my last question. I would like--if you
would, please, I would like to get the answer to that question
as well by November 10.
Then also I am curious to know what is the total cost of
the program, including the purchase, storage, and the
destruction of each one of these machines and how many
machines, puffers, were there?
Mr. Kane. I forget the exact number of the puffers that we
have had. We disposed of them really prior to my coming on this
job, so it has been a few years. I know the total value is
somewhere I think in the $30 million range of that program.
Mr. Cravaack. For the purchase?
Mr. Kane. Right, for the purchase. The disposal cost is
going to be a small fraction. At the end of the day, again,
that will be lumped into the aggregate cost that we budget
every year for disposal.
Mr. Cravaack. Okay. Could you also have the TSA provide my
office with the most recent quarterly warehouse inventory
report?
Mr. Kane. We can get that back for the record as
appropriate.
Mr. Cravaack. Okay, I appreciate that.
I guess the next question I might have, I would go back to
Mr. Nayak, if I could. What are the consequences if the TSA
does not follow DHS procurement guidance?
Mr. Nayak. The answer would be it depends on what stage of
the acquisition life cycle they are not following guidance. If
you have any specifics, I would be happy to answer it.
Mr. Cravaack. What if, for example, that we weren't
following procedures in regards to the puffer machines and the
AT-2 machines?
Mr. Nayak. So with regard to major programs like that,
these kinds of decisions would be coming up to our Investment
Review Board, and they most likely would not make it through at
this stage in our evolution of the Investment Review Board. I
was not around during these purchases.
Mr. Cravaack. It is a hot potato.
Mr. Nayak. Yes.
Mr. Cravaack. Thank you very much for that.
I would also like, Mr. Kane, if I could ask you just real
briefly, what are we doing for expediting passage through TSA
checkpoints for the business leaders or people that travel on
business routinely? They are pretty much trusted travelers.
Mr. Kane. Yes, sir. So we kicked off four proof of concepts
in four airports on October 4 called TSA PreCheck, and that is
to a small group of the known travelers, just to prove out the
concept of being able to assess that risk, understand it within
our secure flight system, put it within the boarding pass, and
allowing those people an expedited screening process through
those four lanes that we are proving out the concept in.
In those lanes, they will typically get to leave their
jackets on, leave their shoes on, leave their belts on, and put
their carry-on--their laptops back in their carry-ons and a
compliant 311 back in their carry-on. So we have--those pilots
are running.
I believe the administrator also testified yesterday that
he thinks those will expand, as long as we are successful there
and can prove out the concept.
Mr. Cravaack. My time has expired. I yield back.
Mr. Rogers. Great. I thank the gentleman.
Mr. Benda, in your comments earlier you made a statement
industry needs to know where we want to go, and I really liked
hearing that. How do you envision seeing that happen?
Mr. Benda. Well, I think it is a two-step process for us,
sir. I think the first step we have already taken with TSA.
They have actually been a partner in terms of developing
requirements and putting together a plan, having an aviation
security research and development plan. Then having one that is
publicly accessible I think is key, so that people know exactly
what we are doing.
I think TSA does a good job of putting their requirements
out in terms of what their detection technologies need to be,
but we are looking to expand that. We are looking to go just
beyond the aviation security R&D and into all of the R&D that
we are going to be doing for TSA.
So they have agreed to develop a pilot process with us
where we are going to examine the different mission areas that
we are going to focus our investments on, map out how those
operations are done, try and identify where we think technology
can achieve some efficiencies to be gained, and then identify
those, identify what investment S&T is going to make, what
procurement investments TASA plans to make in the future--
because there is no point in investing in R&D dollars if there
is not a future investment strategy or market for that
technology--and then come up with a publishable document that
we can put out to industry to show them this is where we are
going to be investing our dollars as well as where TSA will be
procuring.
Mr. Rogers. This would be for any one of you that want to
take it, but one of the complaints that we have gotten from
industry, particularly smaller companies, is that you all will
put out an RFP and they will spend a significant amount of time
and money preparing for it, and then you withdraw it or decide
not to go forward. How frequently does that happen and why?
Whoever would be the right person to hit that one, I would
appreciate it.
Mr. Nayak. I will just jump in, Chairman.
It does not happen that frequently, but here is the
problem. When it does happen, it hurts. You know, I was in
small business. I was in large business. I understand it,
because I also was the guy that did the proposals. So I lived
and breathed that.
So, you know, it did something we totally don't strive to
do. It doesn't serve us well either. We drag our own folks
through the process. It is never our intention, and then
occasionally it does happen and industry does express
themselves. So we make every attempt to not have that happen.
Again, very importantly, it is really the minority. It not
the majority. It is the exception.
Mr. Rogers. Well, I would like to know if you could do a
review, like go over the last 3 years, how frequently has that
taken place. I have one company that spent about $100,000
preparing. You know, for a small company, that is a lot of
money to have it then withdrawn. It does hurt. So I would
appreciate it if you could give me a ballpark number of how
often that happened and what percentage that is. It may
indicate just what you said, that it is a very rare occasion.
Mr. Kane, does TSA fully adhere to DHS acquisition guidance
in all of its procurements?
Dr. Nayak, you can feel free to follow up on that.
Mr. Kane. Mr. Chairman, we certainly strive to adhere to
all the DHS guidance in our all of our procurements. I think we
have all gotten better at that. But I would not say we are 100
percent compliant with everything it is we need to do, just in
catching up with when the acquisition directive was published
and many of our procurements were on-going and getting
ourselves square with all the guidance as we have these on-
going procurements happening. But we do follow the process with
a very stringent test regime.
The one thing the Department and us, I think we are the
first operational test agent within the Department, meaning we
can sign off our own test reports, still with the oversight of
S&T's independent authority to have oversight there. Then we go
through the investment review process with all those test
results and with all those folks who are sitting in the room
with the knowledge of the program.
So I think we are much better at adhering to the guidance,
and we intend to bring ourselves fully aligned in the near
future.
Mr. Nayak. So I will just add to that and just say that we
have the Investment Review Board. There is a lot required of
major programs at DHS, a lot of documentation, appropriate cost
estimates. Part of this is staffing up appropriately in the
components, which we have had a difficult time doing, frankly.
So I wouldn't say everybody is perfect, but I would say our
system now has evolved to a point where we can slowly move
towards perfection.
Mr. Rogers. Mr. Kane, development and procurement of the
Advanced Imaging Technology, AIT, is of great interest to this
subcommittee. To what can extent did TSA adhere to the
established DHS acquisition process administered by the DHS
Acquisition Review Board in procuring AITs?
Mr. Kane. So we adhered to the process, but that was one of
those procurements that was on-going as the acquisition
directive 102, AD 8102 as we know, it was promulgated. So there
were some of these documentation requirements that we did not
complete.
But what we did with the AIT, we went out and we did
operational test and evaluation. We had those results reviewed.
We presented those results to the Acquisition Review Board and
any adjustments we had made in terms of many of the
requirements along the way and got an affirmative decision for
the full procurement and deployment of those systems.
Mr. Rogers. Okay. To what extent do the AITs deliver in the
performance initially promised in the original performance
specifications?
Mr. Kane. Sir, we are getting probably into areas of
sensitive security information, Mr. Chairman. But the AITs are
obviously the most effective technology we have for defecting
nonmetallic threats and the only one we have for detecting
nonmetallic threats on people.
Mr. Rogers. Thank you very much.
My time has expired. The Chairman now recognizes the
Ranking Member for any further questions she may have.
Ms. Jackson Lee. Thank you, Mr. Chairman.
I want to pursue making sure that we have all the resources
that we need to have to address all levels of business. But in
particular we are finding through these hearings the need to
focus on small businesses, with probably a great amount of both
talent but also a great amount of inventiveness.
Mr. Benda, you are in a very important area, and so my
question is: If the present budget was to go forward as
proposed by the House budget, what would happen in your area
with respect to any impact on small businesses and the work
that you do, the work that your particular area is engaged in,
S&T?
Mr. Benda. Thank you for the question, ma'am.
We consider small businesses to be the engine of innovation
for this country. We think they are critical to our success.
Some examples if that budget did go forward, as I stated
earlier, our core R&D funding would be cut by 77 percent. What
that would mean is that our current SBIR process, our small
business innovative research program, we fund around 60
programs a year, would drop down to four. You would see a
massive decrease in the amount of funds going to small
businesses through that program.
Ms. Jackson Lee. Give me that number again. You fund how
many?
Mr. Benda. Currently, on average, ma'am, we fund 60
programs through our Small Business Innovative Research
Program. If the budget went through as proposed, we would only
be able to fund four.
We also leverage small businesses, and where we have seen a
lot of growth in our funding of small businesses is in the
cybersecurity area. A lot of small start-ups happen on the
coast.
We recently lead a cyber BAA--it is a broad agency
announcement, it's a contract vehicle--and we had over 1,000
respondents to that vehicle, even though it is fairly small if
you compare it to DOD standards. It is around $75 million over
5 years. We had 1,000 respondents, and we had a whole range of
companies that responded to that, with a significant part of
that being small businesses.
Those kinds of efforts would end. We would not have any
money to pursue cybersecurity efforts. We would have no money
to pursue any additional funding for bio-attacks, any
additional funding for detecting submersibles that could
smuggle drugs into the country or nuclear weapons. We would
have to end all of our R&D in those areas. We estimate that the
S&T funding currently funds around 1,400 science and
engineering jobs. Those would all be lost.
So we think that these kind of cuts would be catastrophic,
at least towards the future of homeland security. That we would
simply have to make do with what we have, not be able to
innovate or improve our efficiencies.
Ms. Jackson Lee. Thank you very much.
That sounds pretty devastating to me, and particularly
since we know we live in a different environment of franchise
terrorism and one that acts on surprise, and even though
intelligence is very important, but acts on innovative
technologies that can be created.
Thank you very much.
Dr. Nayak, let me ask you to think about or to recommend
for TSA in order to issue and award contracts in an efficient
manner, we just have highlighted the puff technology, while at
the same time ensuring competition in the proper use of TSA
funds in technology development, so what do you recommend that
TSA engage in in order to issue and award contracts in an
efficient manner? What would be your suggestion?
Mr. Nayak. I think, as Mr. Kane alluded to, we have a good
process in place now through this management directive with
respect to managing major programs. We just need to see that
actually sort of take place over time.
In other words, we have got an Investment Review Board.
Major programs come up at least 11 times for review. We now
have and we are developing an information technology tool where
we have insight, real time insight, into--eventually it will be
all 500 programs but, right now, our major programs. So just
having the components go through that process will ensure
effectiveness.
Ms. Jackson Lee. Let me follow up with just one more
question. Thank you.
I am not sure if this was articulated in your testimony,
but I am going to ask for sort of an ABC on that new process. I
know you articulated it just to me. But if there is a non-
classified ``here is what is in place,'' I think it would be
helpful for it to be in this committee or directed to all of
us.
Mr. Chairman, I am asking if that document or summary could
be submitted to us, please.
Mr. Nayak. I am happy to do that.
Ms. Jackson Lee. Thank you.
Let me go to this idea of small businesses, and it builds
on testimony that we received on the Department's growing
number of contracting operations with small and medium-sized
businesses. We appreciate that growth. In fact, I am going to
make a statement that we want to see that growth across the
spectrum of Government agencies.
We also learned that, based on the Federal procurement data
system, DHS currently spends about 70 percent on service
contracts and 30 percent on product contracts. One would tend
to believe that a small business could work closely with the
idea of service contracts. How does the Department reach out to
small businesses to determine what current or emerging
technology has been developed that could be applied to Homeland
Security initiatives, particularly in this scheme that you have
70 percent service-30 percent product, and how can we ensure
that the Department maintains a healthy process with medium and
small businesses? How can Congress continue to support this
mission? Dr. Nayak.
Mr. Nayak. Thank you.
So with respect to technology specifically, I will let my
fellow witnesses----
Ms. Jackson Lee. Mr. Kane, maybe, from S&T.
Mr. Nayak [continuing]. Can share. But I would like to
share how we are doing.
Just business overall, the spread is essentially about--
there really is no definition for medium business, but the CSIS
report that the gentleman who came and testified in the second
hearing, about 40 percent of our business goes to large
business, about 30 to what they defined as the middle, and 30
to small business.
What I do want to share is, from a Departmental
perspective, we take all businesses seriously in order to
achieve the mission. But with respect to small business
specifically, I do want to say it is important to note that we
rank either one or two in every small business category among
the top seven spending agencies in the Government which
comprise 90 percent of the $500 billion spent in Government.
So, just very briefly, in overall small business, we
achieved 29 percent, and that was No. 2. In small and
disadvantaged business, we achieved 11.5 percent of our spend.
That was No. 1. In women-owned small business, we achieved 5.9
percent. That was No. 2 among the top seven spending agencies.
In small disadvantaged veteran-owned business, we were No. 2
with 4 percent. No. 1 was the Veterans Administration, who has
statutory authority to award contracts to veteran-owned
businesses. We are very proud of that. HUBZone, which is very
difficult to achieve, we achieved 3 percent. We were ranked No.
1.
So we take small business extremely seriously. We have had
significant achievements over the past 3 years. At a macro
level, the SBA has a new rating system. They give you A through
F. We have had an A the last 2 years. We believe we are going
to get another A in fiscal year 2011.
But with respect to connecting with small business and
technology I would ask Robin or Paul if they had anything to
add.
Mr. Kane. I would just briefly add that we have support
contractors that support our technology programs, and one of
those we set aside for a small business set-aside and awarded
those contracts, a multi-award contract for professional
engineering and logistic services that we did as a set-aside
for small business, and we used multiple small businesses in
the task quarters of that award.
Ms. Jackson Lee. I yield back at this time and thank the
witnesses.
Mr. Rogers. The Chairman now recognizes the gentleman from
Minnesota for any further questions he may have.
Mr. Cravaack. Thank you, Mr. Chairman. There will just be
one.
Prior military--the military I have seen through the years,
especially in aircraft where you would have a joint
conglomeration of technologies in, for example, the Joint
Strike Fighter. Though it might have a varied mission but at
the same time being able to land at sea, the knuckles and the
landing gear have got to be a little bit tougher, but mainly
the same type of platform.
What I want to see, I was wondering what the TSA is doing
like in collaborating with some of the other agencies, say
Border Patrol, in being able to combine the technology and the
cost savings, and how much--I don't know if Mr. Kane or Dr.
Nayak, you can answer these questions--but in combining the
technologies, how much cost savings do you see there?
Mr. Nayak. Let me first turn the mike on.
Through our Strategic Sourcing Program, okay, so,
essentially, we have 90,000 transactions, $14 billion for the
last 3 years that we spent.
What is strategic sourcing? It is the capability to look at
those transactions and decipher how you can do exactly what you
mentioned, Congressman, and that is see where there are
opportunities to bring things together, leverage volume, just
get a better deal overall.
We have 42 initiatives in the Department that we have
awarded. We have saved over $1 billion since our program got up
and running in 2005. Our goal this year was $200 million. We
have another 13 or 14 initiatives on the way. In fact, the
canines was a strategic sourcing initiative success story. That
is how we work it. That is done out of my office. It is on-
going.
Detection equipment, which Mr. Edwards mentioned, is
another interesting one where we agreed with the IG's Office.
Detection equipment is an interesting one.
In fact, all of these are very interesting. They take a
little bit of time. Because you have to first sort of find the
opportunity, which now we have the ability to do that. The
second thing is get a working group together to figure out what
of this can you really strategically source. On the surface, it
sounds really good. Detection equipment, let's do it all. But a
working group has to sort of work that out. Then eventually we
get to the actual procurement, which replaces other contracts
and saves dollars over time.
Mr. Cravaack. So you do have something in place already
that you can talk to other components to see if you can combine
the purchase. Are you saying it is working well at this point?
Mr. Nayak. It is working well, and we want to do more of
it.
Mr. Cravaack. That is good to know.
With that, sir, I yield back.
Mr. Rogers. I think that is the result of the IG report,
right? That was one of the focuses you all had, and you are
responding to that.
Mr. Nayak. Only detection equipment. We had the program up
and running. Their recommendation was to use the program
specifically for detection equipment. But we have 42
initiatives that already on-going. In other words, canines we
figured out on our own.
Mr. Rogers. Mr. Davis, do you have any additional
questions?
Mr. Davis. No.
Ms. Jackson Lee. I do. I just want to make a comment. I
just have a comment. So are you getting ready to do your
questions?
Mr. Rogers. Mr. Benda, you invite industry to bring its
technologies to TSL at a fairly developmental stage for testing
and for guidance on how their detectors can be improved to meet
TSA needs. There is no cost to industry for this service, which
can go on for months or years, which means you essentially
provide a free research and development feedback resource. What
are your perceptions as to how well industry appreciates this
resource and is there anywhere else they can go for this kind
of testing and evaluation service?
Mr. Benda. Sure, sir. I appreciate the question.
I think industry, the level of appreciation on the
resource, it depends on whether they have gotten certification
or qualification approval from the labs. So I think it all
depends on where you are sitting.
I do think it is an unusual aspect that the Transportation
Security Lab offers, supported by the HSARPA, which I run, to
work with them to move technologies through the process. We use
what is called a collaborative research and development
agreement, CRADA. It is a public-private partnership. Basically
we think we need to improve that process, and I have been
working with Susan and her staff as well as my explosive
division director on how we can do that, as well as Robin's
chief technology officer.
Because it shouldn't take years, sir. If you are coming in,
and we need to make up a better assessment early on, do we
think this technology can meet the TSA requirements, and, if it
can, we need to spend some time on that. But we need to put
some bounds on it. We need to understand what market this
technology can fill, what existing technology has filled that
market already.
We can't necessarily fund every technology that can
eventually fill it or subsidize them with Government money. So
if that market is already being filled adequately by an
existing technology, the Government shouldn't subsidize them,
as I imagine you would agree.
So we want to look at that. We want to develop a process
that is in place. We want to scope that support and make sure
that, instead of taking years--no one should take years--but
expedite that process to be a matter of months and make sure
that those that have the best value come first.
Mr. Rogers. Great. I note that TSL has recently improved
its process for working with private sector through cooperative
research development agreement which allows the maximum amount
of information sharing to companies with clearances, even if
they do not have a procurement contract. This sounds to me like
a real DHS success story. Tell me how the agreement will help
further industry's goals to provide needed technologies and
grow their businesses.
Mr. Benda. Again, that CRADA process is what you are
referring to. The challenge that some small businesses have, as
you have said, they can't get a clearance unless they have a
contract in place. The CRADA allows us to use what is called,
in technical parlance, a DD-254. We leverage a DOD process in
place that says there is an existing agreement with the
Government and allows us to share classified information with
them because it is in the best interests of the Government,
which also turns out to be in the best interests of the
business. So when those processes are in place, they get a
better understanding of what those requirements are.
As you are certainly aware, we can't share with everyone
what those technical requirements are because we can't let
those become public.
But the CRADA, once that is in place and once that sharing
is in place, we are going to do a better job. The big process
improvement we are going to make is that scoping up front and
putting more documentation in place, both on the front end and
the back end of the process. So people will understand what we
are going to do in the CRADA. We will be very clear on our
requirements, very clear on what we what we hope to achieve,
very clear on the time lines, as well as at the end of the
process in terms of what we have gotten out of it.
Mr. Rogers. Great.
We have Susan Hallowell here, and I have two questions for
her. Susan, if you would come up to the microphone.
Once the testing and evaluation is complete at TSL in New
Jersey and including an additional stint in Florida for
homemade explosives testing, I understand that machines are
then sent to Washington Reagan Airport for initial field
testing for liability and maintainability and then on to
airports across the Nation for full-scale operational T&E.
Some in industry balk at this prolonged process, which can
take months, if not longer, and which requires shipping
machinery across the Nation. They cite a better model in some
countries in Europe where private companies are contracted to
do the certification and they do it more quickly and
efficiently than the Government can. We have also heard that
delays sometimes happen because of simple things that are
easily fixed, but the process requires a complete redo.
Dr. Hallowell, can you please tell me whether and why every
step of this process is necessary to ensure the efficacy of the
technology that TSA is purchasing?
Ms. Hallowell. Thank you, Mr. Chairman.
Mr. Rogers. Just turn the microphone on.
Ms. Hallowell. Actually, that overall process is held by
TSA, so that is more of a TSA issue. The actual certification
we do at the laboratory is just one small cog in a larger
process. So I would put that question to Mr. Kane.
Mr. Rogers. Okay. Mr. Kane.
Mr. Kane. Yes, sir. Many of the things you just talked
about, while they are virtually all true, as I understand what
you just said, that is our process, much of which is required
by the acquisition guidelines that we have to follow, and it is
put in place to prevent things that have happened in the past
such as the puffers.
So our integration facility at Ronald Reagan is to get into
a near-operational environment for equipment before we actually
put it out into airports, and they have to experience what the
real results are, and we find out things that aren't explosives
detection.
What TSL does, not exclusively, but what they do, their
large expertise lies in explosive detection and qualifying
that, yes, it can detect the things that we need. There are
many other requirements that machines have to meet to operate
in the airports, as you know and as we have experienced in the
past.
So we run this whole process. It does take time to run a
test at the TSL, to run a test at our facility at Reagan, and
then to do actual field testing. But that is a rigor that we
want to put into this process so when we are making decisions
on hundreds of millions of dollars that we are making the right
decisions.
Mr. Rogers. Okay. Then I won't ask this follow-up question,
since it was Mr. Kane.
Mr. Edwards, how much money do you think the Department
could save if it used strategic sourcing to acquire all of its
detection equipment?
Mr. Edwards. Thank you, sir.
We looked at just the detection equipment itself, and if
they had used strategic sourcing they could save $170 million.
Mr. Rogers. Excellent.
What steps do you recommend be taken to standardize the
inventory technology so that all components in the Department
are aware of what other components already have and are
purchasing?
Mr. Edwards. Strategic sourcing is known for best
practices. It results in efficiencies, economies of scale, and
volume buying. It also reduces overhead costs for procurement.
For instance, in the detection equipment, if you are
buying--every component is buying different types, then you are
going to increase the maintenance costs, the training costs. So
if components work together and buy these--and have less number
of the different types, then there is going to be volume
savings.
It also is good for the industry because you have a single
point of contact that you can go to. They can just go to the
Strategic Sourcing Program Office and the vendors can just go
to them, rather than going to the different components.
Mr. Rogers. Dr. Nayak, do you want to comment on that?--or
you don't have to.
Mr. Nayak. I think he accurately covered it.
Mr. Rogers. That is great.
The Chairman now recognizes the Ranking Member for any
further questions.
Ms. Jackson Lee. Thank you, Mr. Chairman.
I will be concluding on this note. I am not sure you are
having another round.
Mr. Rogers. I have more, but I am going to give them in
writing.
Ms. Jackson Lee. Okay, and I am going to do that as well.
But let me ask this question of Mr. Kane, and I am going to
say to you that I would like to have a more extensive answer in
writing. So that means a period of time that you may take that
you can abbreviate.
One of our increasing concerns across the Federal
Government is the possibility of theft of large volumes of
sensitive information contained in mobile data storage devices.
What is the DHS policy concerning what portable data is
encrypted and are there currently any DHS processes where
portable data is not encrypted?
Mr. Kane. Okay, and I will be happy to take that one back
for the record. I am not the expert in this.
But all of our portable devices, the CIO imposes
requirements for encryption on those devices, and they actually
have an approved list of those that we are allowed to use. So I
can't just take any memory stick out and put it in my computer.
It has to be an approved memory stick that I can use today.
Ms. Jackson Lee. Mr. Chairman, I would almost say that this
would warrant a classified briefing. There are so many various
portable devices going around in many people's hands, and this
is not a question of the integrity of the staff of DHS as much
as it is the need to be secure. So I am going to submit this
letter into the record--I am sorry, excuse me--this question
into the record for a more extensive response.
Let me quickly go to Mr. Edwards.
TSA has confused purchases and acquisitions. There was some
detection that IG released a report indicating that. Can you
please explain the difference between an acquisition program
and procurement and explain why additional costs may have been
incurred by TSA in this case?
Mr. Edwards. Thank you, ma'am.
A simple procurement is a simple one-and-done action. For
example, if you are buying paper, it can be managed by a single
procurement. In contrast, an acquisition program is a more
complex process that includes planning, purchasing,
maintaining, managing, and overseeing an acquisition of goods
and services. High-value items are normally usually acquired
through an acquisition program.
For example, if the Coast Guard is buying a Coast Guard
cutter, it is managed and overseen by an acquisition program.
In this case, what we are talking about in our report is TSA
managed the renovation of a 12,500-square-feet warehouse as an
acquisition program rather than using it as a simple
procurement. By treating that relatively small renovation
project as an acquisition program, TSA increased administrative
costs and also due to additional personnel and also overhead
costs it incurred because of the oversight and internal
controls required for an acquisition program.
Because of this confusion incurred by TSA and other
components, we recommended to the Department that they double
up the decision matrix tool about whether acquisitions should
be managed as a simple procurement or an acquisition should be
managed as an acquisition program. So the Department agreed to
our recommendation and is in the process of implementing it.
Ms. Jackson Lee. I think that is a great improvement. Thank
you very much.
Mr. Chairman, I just wanted to put two issues on the
record. I made a somewhat humorous comment earlier, but I
wanted to clarify two things.
One, I wanted to conclude by thanking the witnesses and
acknowledging to Dr. Nayak--I wanted to acknowledge the
seemingly celebratory numbers that you are citing relating to
your outreach to small businesses. I think whenever an agency
comes forward, we should say thank you, and I want to thank you
for what appears to be very positive numbers.
I would only comment that I want our reach to be not only
small businesses but the non-sophisticated small businesses
that may be in States far and wide that don't have the
experience that some who are in tune to working with the
Federal Government--and if you live in this area long enough,
you know that there is a constituency of small businesses, no
discredit to them, that work with the Federal Government. That
is their work. They know how to do it. That doesn't mean they
are in Alabama. It doesn't mean they are in Texas. It doesn't
mean they are in Illinois. It doesn't mean they are in
Minnesota and various other places. I want us to get our
numbers where we show that demographic or that geographic,
excuse me, diversity, so that when we go home, wherever we
might be, there will be someone who says that they received
some information on that opportunity.
That is the first thing, Mr. Chairman.
The second thing, as I sit in this committee--and I will be
brief--I think they pointedly put that picture, Mr. Chairman,
in front of the Chairman and the Ranking Member, straight
ahead, if you look and you will see it on the wall, for a
reason, for us to know our purpose and our cause here. So I am
serious.
I want to publicly apologize for the actions of one TSA
inspector that violated the trust of this work and violated a
traveler's personal belongings. In this instance, it was a
woman, and in this instance it probably would create humor, but
I didn't think it was funny.
So I am going to ask that we will perspectively have a
meeting, we are overdue for a meeting with Mr. Pistole on a
number of issues. I count that on the issue of professional
development and training. I have been a champion of TSA in
terms of its workforce for training, professional development,
the ability to ascend to a higher position, and I am very
disappointed in that particular act that occurred about a week
or so ago.
The second aspect, Mr. Chairman, that I would raise a point
with is seemingly the confusion--I have not gotten a final
report on the question asked as to whether or not TSA checks on
checked weapons. As you well know, you can check a weapon in
your suitcase, and I think the public is a little aghast that
we have no record. I think we thought we were doing everything
that we could, and I think there was a question of whether they
were loaded or unloaded. But the answer came that that was not
TSA's responsibility to determine that in a suitcase, lodged in
a suitcase.
I think we need to change that policy and there needs to be
a way of determining what ammunition and weapons are in checked
luggage. Our first line can be domestically versus
internationally. We can maybe start with that, and I would like
for us to take up that issue. That is not an NRA issue.
Mr. Rogers. Where did you hear that? I went to the Atlanta
Airport 2 weeks ago, not a flight, just to go over there and
let them take me through their screening systems. One of the
areas they took me through was where they screen the baggage.
They do require that the gun be unloaded and it be in a box
that is sealed. If the passenger doesn't disclose to you that
they have got one in their bag, what they do, they will tag the
bag so that you know he has disclosed it or she has disclosed
it. But if not, they do run it through a scanner where they
look for the gun. They allow you to have it, but it has got to
be unloaded.
Mr. Kane, am I stating that right?
Mr. Kane. Sir, just to clarify, there are requirements for
how you have to check a firearm. Our detection technology does
not detect firearms in checked baggage.
Mr. Rogers. Well, when I went through Atlanta, they said it
did.
Mr. Kane. If you are looking visually, you may see it on a
visual image. But as a general rule, especially in our big in-
line systems, this equipment is designed to detect explosives,
and it does not detect a firearm.
Mr. Rogers. Well, I agree with the Ranking Member. We need
to find out more about this.
Ms. Jackson Lee. I think that would warrant a classified
briefing.
Mr. Rogers. I agree.
Ms. Jackson Lee. Because we don't want to expose it. I
thank Mr. Kane for his honesty in clarifying it for both the
Chairman and myself. So I would list that as an item that is
left with questions, and I believe it is appropriate for us to
handle that in a manner appropriately.
So, Mr. Chairman, because of the burden of our
responsibility, I just want to make sure that we cross every t
and dot every i, and I would look forward to pursuing those
issues.
Mr. Kane. Can I offer just two comments, Mr. Chairman, if I
could?
First, on the incident with the officer, I would just like
to be on the record as saying TSA took that very seriously as
well and instituted--this is a discipline issue and we clearly
would institute a disciplinary process swiftly in that case, in
all cases.
Second, a firearm in a bag that you don't have access to is
a much different proposition than a firearm in a carry-on bag.
I just would like to note that. There are reasons for some of
the differences we have.
Ms. Jackson Lee. Oh, I fully understand that, but I think
we need to get it clarified. As they say, that building reminds
us that something can always go wrong, and that is the only
reason I brought it up.
Mr. Rogers. I just want to make sure I am clear on that. I
understood when I was seeing that in-line process that it could
determine a gun. We will follow up with you all and get
somebody in that can help us in a classified setting explain
the technology and its capabilities and limitations.
I, first of all, want to thank all of you. I know we are
over time, and I am not going to drag this out. But I have got
a ton more questions. But what I am going to do is submit them
to you in writing. The record will left open for 10 days, so if
you can get us a reply to those, it will be very helpful to us.
I do want to let you know I wanted to have this hearing on
the record to raise a lot of these questions and give you an
opportunity to offer your thoughts. But I would like to have a
chance to sit down with you all again and the Ranking Member
and let's just kind of talk through more of these for our
edification in a more informal fashion. Because you all
obviously are a great resource for us to draw on, and you have
got a lot more that I would like to know.
But I do think that I have gathered from your comments here
today that you all are working on what I want to see, and that
is more transparency and more interaction with the private
sector as to how we can in partnership achieve our security
goals, and that is encouraging. So I am very happy about that.
The one thing I did want to ask, and it follows up to what
the Ranking Member was pursuing, and that is, as you go forward
with these industry days, and this will particularly be for Mr.
Benda and Dr. Nayak, and you look at this new and improved
version, how do you outreach to small businesses? How do you
get the word out that you are inviting their participation?
Mr. Nayak. Well, for us, it is very simple. We use the open
announcement with what is called Fedbizopps. So it is an
announcement to the world, and that is standard. That is what
everybody who does business with the Government knows to go to.
Mr. Benda. We follow the same process, sir. We will put out
a request for information. We will use Fedbizopps.
Mr. Rogers. Okay. Do you pretty much count on the their
industry associations to kind of spread that word after they
get the Fedbizopps release?
Mr. Nayak. You know, there is about five or six. I noticed
you had participation from one in a previous hearing. They
cover a subset of the universe. They do have large and small
business. But they are not the universe. So we do work very
closely with them. Quite often--I speak at literally every one
of the associations. But, again, we have to use something that
goes out to the world.
I mentioned an industry advisory council. Again, whatever
we create has to be very open, very transparent, and that is
the trick to sort of figuring this out. But we are working with
those associations as well as others to figure it out.
Mr. Rogers. Well, you know, I talked with the Ranking
Member about this. I have been Chairman of this committee now
for almost a year, and I didn't know what fbo.gov was until 3
days ago as I prepared for this. Trust me, I am a low-tech
fellow. I worry like she does about people who aren't
sophisticated but have some contributions they can make.
One of the things I am going to be doing is setting up a
Transportation Security Caucus, and the Ranking Member has
already indicated her desire to participate in that. We want to
work with you all about some ideas about how we can stir
interest out there and get folks who may not be computer-
sophisticated aware that there are opportunities here and we
want their participation.
I thank all of you. This has been a very worthwhile
hearing, and we are now adjourned.
[Whereupon, at 4:18 p.m., the subcommittee was adjourned.]
A P P E N D I X
----------
Questions Submitted by Chairman Mike Rogers for Nick Nayak
Question 1a. You have stated that one of your strategic objectives
is to establish quality communication between industry and DHS. One way
you aim to accomplish this is to require acquisition planners to
develop vendor engagement strategies for major acquisitions that may
include activities such as Industry Days or conferences; the ``DHS
Acquisitions Planning Guide'' was just amended for this purpose.
Do these requirements apply to all acquisitions planners across the
Department, even within components like TSA that have their own
acquisitions office?
Answer. Response was not received at the time of publication.
Question 1b. Do you expect DHS and TSA to put into effect a similar
planning model to DOD's, whereby multi-year acquisition plans are
provided to the vendor community to help better align private sector
R&D with the needs of DHS and TSA? It seems to me that a 5-year budget
estimate included in TSA's annual request to Congress would go a long
way toward this end.
Answer. Response was not received at the time of publication.
Question 2. This committee has been spending some time, including
through other hearings, looking at how the Department utilizes
technologies that have been deployed in other agencies, such as the
Department of Defense. One of the greatest tools at our disposal to
save the Department needed dollars is to leverage existing
technologies.
Are existing technologies always considered when developing
acquisition policy at the Department? If not, what one policy change
would have the most impact on enhancing the Department's ability to
effectively leverage emerging technology?
Answer. Response was not received at the time of publication.
Question 3a. The importance of establishing realistic and risk-
based requirements, and sharing them with the vendor community as early
and as much as possible, cannot be overstated.
Do you feel that requirements should be primarily based on mission
needs, or on the existing capabilities of commercial technologies that
vendors currently have?
Answer. Response was not received at the time of publication.
Question 3b. What is the proper role for vendors in setting
technology requirements?
Answer. Response was not received at the time of publication.
Question 3c. Mr. Kane, as a follow up, what process does TSA follow
to establish performance requirements for technologies it seeks to
procure? And how does TSA use information from the scientific community
to inform the development of key requirements?
Answer. Response was not received at the time of publication.
Question 3d. What options are open to the Department for
establishing rigorous requirements that are threat- and risk-based, and
for which there is cross-component input?
Answer. Response was not received at the time of publication.
Question Submitted by Ranking Member Sheila Jackson Lee for Nick Nayak
Question. In your testimony, you assert that the Department has
made progress in providing better training and certification for
several acquisition career fields. What challenges, if any, have you
faced in increasing training of DHS program managers? How have
improvements in training and certification lead to a more effective
acquisition process?
Answer. Response was not received at the time of publication.
Questions Submitted by Chairman Mike Rogers for Robin E. Kane
Question 1a. TSA has recently undertaken a structural
reorganization. Mr. Kane, you now lead the Office of Security
Capabilities. TSA has stated that under the new system, all of the
former Office of Security Technology and elements of the Office of
Security Operations and the Office of Intelligence are grouped
together, creating ``a single office with responsibility for defining
and developing both the security and technology capabilities required
to execute our counterterrorism mission'' and matching ``capabilities
against threats to identify and deliver high priority capabilities to
the field.''
How does the TSA reorganization result in more streamlined
development and procurement? Please provide us with some concrete
examples of how this works.
Answer. Response was not received at the time of publication.
Question 1b. What is the ``Security Policy and Industry
Engagement'' office responsible for?
Answer. Response was not received at the time of publication.
Question 2a. The joint TSA-S&T aviation security technology
strategy states, ``To encourage consistent dialogue and proactive
involvement with S&T, TSA will produce and maintain technology roadmaps
that outline desired capabilities, high-level development milestones
and dependencies for major technology products and incremental
capability enhancements. Strategy roadmaps indicate key mission
capability needs and the TSA efforts to accelerate the development of
advanced solutions.''
Have these roadmaps been completed and shared with the private
sector? If not, when will they be complete and publicly available?
Answer. Response was not received at the time of publication.
Question 2b. Has the strategy resulted in new or improved
technologies?
Answer. Response was not received at the time of publication.
Question 3. The ``For Official Use Only'' version of the joint TSA-
S&T aviation security technology investment plan has a time line for
achieving specific goals and sub-goals that extends through fiscal year
2014.
Has this timeline been shared with industry? While I'm sure you
need to be careful about broadcasting predictions that may change due
to emerging threats, by the same token, industry needs some kind of
roadmap to strategize and formulate semi-long term business plans.
Answer. Response was not received at the time of publication.
Question 4. The importance of establishing realistic and risk-based
requirements, and sharing them with the vendor community as early and
as much as possible, cannot be overstated.
What process does TSA follow to establish performance requirements
for technologies it seeks to procure? And how does TSA use information
from the scientific community to inform the development of key
requirements?
Answer. Response was not received at the time of publication.
Question 5a. Goal 4 from your aviation security technology strategy
states that TSA is looking to ``increase capability to respond to
emerging threats through development of flexible security solutions.''
Since many of the technologies that TSA acquires are still
undergoing additional development, how does the agency ensure that the
technologies are improved once acquired?
Answer. Response was not received at the time of publication.
Question 5b. Is it going to become necessary for vendors and TSA to
reach an agreement at some point that allows an open, standard data
file format that allows TSA to contract out upgrades to the best
vendor? Will TSA need rights to the data at some point to allow for
true flexibility and efficiency in upgrading its systems?
Answer. Response was not received at the time of publication.
Question 6a. TSL provides a technical service for TSA by certifying
equipment that meets its requirements, or determining what equipment
does not meet TSA's requirements.
Has TSA ever purchased equipment that did not meet certification
standards as tested to by the TSL?
Answer. Response was not received at the time of publication.
Question 6b. Has TSA ever considered using the TSL in a different
way, that is, harnessing its decades of experience working with
technologies so that TSL is actually involved in the developing of
requirements, and not solely testing to them?
Answer. Response was not received at the time of publication.
Question 7a. TSA used to engage in extensive research and
development activities. In fiscal year 2006, Congress consolidated
TSA's R&D activities with those in the S&T Directorate.
What effect does the separation of research and development
activities from acquisition and operational activities have on TSA's
ability to adopt new technologies? What benefit, if any, would accrue
from transferring back to TSA its research and development
responsibilities?
Answer. Response was not received at the time of publication.
Question 7b. After the transfer of TSA R&D activities, TSA and S&T
signed a memorandum of understanding regarding the use and priorities
of the TSL. How successful is your partnership with S&T regarding use,
upkeep, and priority setting for the TSL?
Answer. Response was not received at the time of publication.
Question 8. How does TSA incorporate the results of covert tests
into its evaluation of existing technology and future procurements?
Answer. Response was not received at the time of publication.
Question 9a. According to the GAO, the S&T Test & Evaluation and
Standards Office expressed concerns about TSA's operational test agent
for the Passenger Screening Program. The T&E Office cited the lack of
independence of the test agent since the test agent was part of the
same TSA office responsible for managing the program. The T&E Office
provided an interim approval valid for 1 year and outlined measures for
TSA to take to ensure necessary independence.
How has TSA responded to these actions by the S&T Directorate?
Answer. Response was not received at the time of publication.
Question 9b. What advantages, if any, might accrue from
establishing a fully independent operational test agent in TSA, the S&T
Directorate, or some other part of the Department?
Answer. Response was not received at the time of publication.
Question 10a. The testing and evaluation capabilities that the TSL
and the Office of Test & Evaluation and Standards provide are key to
ensuring that all machinery purchased by TSA meets its own prescribed
standards.
Does TSA leverage these capacities completely? Was that done with
AIT?
Answer. Response was not received at the time of publication.
Question 10b. I understand that TSL often evaluates TSA technology,
but not always. Why is that, and can you tell me about some
technologies that you purchased that were not put through TSL testing?
Answer. Response was not received at the time of publication.
Question 11a. The S&T Directorate has established as one of its
strategic goals to leverage its technical expertise to assist DHS
components' in establishing operational requirements, and to select and
acquire needed technologies. This requires the S&T Directorate to have
a firm understanding of the technical and environmental constraints of
the DHS components' operations and a close working relationship between
S&T Directorate program managers and DHS component decision makers.
In your experience, what activities, both formal and informal, has
the S&T Directorate taken to increase its role in TSA's establishment
of operational requirements?
Answer. Response was not received at the time of publication.
Question 11b. How successful have these activities been, and what
results have come from them?
Answer. Response was not received at the time of publication.
Question 12. This committee has been spending some time, including
through other hearings, looking at how the Department utilizes
technologies that have been deployed in other agencies, such as the
Department of Defense. One of the greatest tools at our disposal to
save the Department needed dollars is to leverage existing
technologies.
Is there a process in place to evaluate the most advanced and
innovative technology that may be in use elsewhere, and could now be
utilized at TSA? And are existing technologies always considered when
developing acquisition policy at the Department?
Answer. Response was not received at the time of publication.
Question 13. Is TSA satisfied with its current process for paying
for technology procurement (purchasing technologies subject to yearly
appropriations), or are there other models it is looking at?
Answer. Response was not received at the time of publication.
Question 14a. In October 2009, GAO reported that TSA had not
completed a cost-benefit analysis on investments for screening
passengers at airport checkpoints because they failed to develop life-
cycle cost estimates for these technologies. While TSA has recently
developed life-cycle cost estimates, GAO reported that TSA has still
not completed a cost-benefit analysis.
To what extent does TSA analyze the benefits of technology
acquisitions and ensure that the additional capabilities gained provide
sufficient benefits to justify their significant costs? That is, do you
perform a cost-benefit analysis for every acquisition, and at what
point in the process does this happen?
Answer. Response was not received at the time of publication.
Question 14b. Does TSA engage its vendors in completing life-cycle
costs and cost-benefit analyses? If not, are there changes that should
be made to this process?
Answer. Response was not received at the time of publication.
Question 15. Would you consider establishing a technology advisory
group made up, in part, of security technology manufacturers? Are there
other advisory bodies within TSA on which industry already serves?
Answer. Response was not received at the time of publication.
Questions Submitted by Ranking Member Bennie G. Thompson for Robin E.
Kane
Question 1. Over the past few years, TSA has increased the number
of Behavioral Detection Officers at airports Nation-wide. Has TSA
developed a scientific method for measuring the ability of Behavioral
Detection Officers to identify people who intend to commit an act of
terrorism or pose a threat to aviation? How many terrorist plots have
been interrupted by Behavioral Detection Officers? Without scientific
validation or proven results, how can TSA justify the expansion of the
number of Behavioral Detection Officers? Does the Department perform
covert testing on Behavioral Detection Officers like it does with
passenger and baggage screeners?
Answer. Response was not received at the time of publication.
Question 2. TSA recently announced a major reorganization of its
components and realignment of certain functions across the agency. How
does this reorganization allow for an increase in cost savings
associated with administrative and procurement functions? How will the
proposed reorganization affect TSA's interaction with S&T and DHS? How
will the proposed reorganization affect oversight of the development of
new technologies?
Answer. Response was not received at the time of publication.
Question 3. TSA continues to make changes to its process for
screening of passengers at airport checkpoints. Does TSA have a plan
for ensuring that the use of new technology is integrated into new
screening initiatives such as the Precheck program? Also has TSA
updated its Passenger Checkpoint Program Strategy to reflect the
increased use of AIT, BDOs, and the Precheck pilot?
Answer. Response was not received at the time of publication.
Questions Submitted by Ranking Member Sheila Jackson Lee for Robin E.
Kane
Question 1. Last Congress, you testified that TSA and S&T have
worked on streamlining processes and coordinating effectively with one
another. What steps has TSA taken to streamline its relationship with
the S&T Directorate and strengthen acquisition and procurement
practices with DHS Office of Procurement? Please provide specific
examples. Furthermore, can you provide more information on how AIT
machines were purchased and vetted by the Department of Homeland
Security?
Answer. Response was not received at the time of publication.
Question 2. Recently, TSA purchased 300 AIT machines equipped with
ATR software that enhance passenger privacy. Have these enhanced AIT
machines reduced delays and wait times in passenger screening? Can the
existing 500 AIT units be updated with the new ATR software?
Answer. Response was not received at the time of publication.
Question 3. TSA has announced plans to conduct CAT/BPSS technology
pilots to determine the sustainability of technology that would replace
the current manual ``lights and loupes'' method of ID authentication.
What challenges has TSA faced with the current ``lights and loupes''
system? How would CAT/BPSS technology enhance ID authentication?
Answer. Response was not received at the time of publication.
Question 4. TSA has deployed 500 next generation Bottled Liquids
Scanners (BLS) to airports Nation-wide. In your judgment, how effective
are the next generation BLS units in comparison to the existing BLS
units? Does TSA plan on replacing the existing 1,000 BLS units?
Answer. Response was not received at the time of publication.
Question 5. One of our increasing concerns across the Federal
Government is the possibility of theft of large volumes of sensitive
information contained in mobile data storage devise. What is TSA policy
concerning what portable data is encrypted and are there currently any
DHS processes where portable data is not encrypted?
Answer. Response was not received at the time of publication.
Question 6. In October 7, 2011, the President issued an Executive
Order directing Federal agencies to better safeguard classified
information, to set up internal audit systems, and to make sure that
reluctance to share critical intelligence in the aftermath of the Wiki
Leaks exposure does not hamper collaboration across agencies. A
component of the Executive Order makes individual agencies primarily
responsible for securing the information they obtain and share. Has DHS
given consideration as to how this order affects them and how will they
go about evaluating possible solutions?
Answer. Response was not received at the time of publication.
Questions Submitted by Chairman Mike Rogers for Paul Benda
Question 1. The TSL cannot necessarily relay to industry the
classified technical requirements to which it is testing.
Do you feel that the Department is sufficiently transparent in
relating requirements for testing? Is the new CRADA that was described
in your testimony sufficient to solve this problem?
Answer. Response was not received at the time of publication.
Question 2. The TSL provides testing services for agencies other
than TSA, such as the U.S. Secret Service, the U.S. Coast Guard, and
Customs and Border Protection.
Have you found that these components have similar needs to TSA,
which could perhaps benefit from joint requirements setting or
strategic sourcing?
Answer. Response was not received at the time of publication.
Question 3. The Government Accountability Office recently released
a report describing TSA's failure thus far to implement its 2010
requirements for explosives detection systems. One of the reasons GAO
cited for this lapse is that TSA and S&T have experienced challenges in
collecting explosives data needed to procure and deploy systems that
meet those requirements.
While it is understandable that scientific endeavors like this can
be unpredictable, on the other hand, does the process somehow need to
be revised so that industry is not gearing up to meet requirements for
an acquisition that may not happen due to scientific challenges? What
can we learn from this experience so that we do not find ourselves in a
similar position in the future?
Answer. Response was not received at the time of publication.
Question 4a. For many years the Science and Technology Directorate
has invested in technology development aimed at detecting explosives in
the transportation context. MagViz technology, for example, has
received funding since at least fiscal year 2007. Under Secretary
O'Toole has previously testified that the S&T Directorate is now
attempting to develop a ``checkpoint of the future'' that can integrate
many of these technologies to provide a multi-faceted detection
capability.
How would you characterize S&T Directorate support for these
technologies? Are they research or development projects? What is the
expected time frame for delivery of a final product? Of the
technologies under consideration for integration into the ``checkpoint
of the future,'' how many of them are mature and have undergone
successful developmental and operational test and evaluation?
Answer. Response was not received at the time of publication.
Question 4b. Historically, the S&T Directorate has developed
technologies to be transitioned to end-users rather than systems that
incorporate those technologies. How significant a role will the S&T
Directorate undertake in systems integration? With respect to the
``checkpoint of the future,'' what challenges do you envision in
attempting to integrate these technologies together into a single
system?
Answer. Response was not received at the time of publication.
Question 4c. The S&T Directorate has established the Apex projects
starting in fiscal year 2012. The ``checkpoint of the future'' is not
one of them, although the impact of integrating and improving
technologies so widely deployed at domestic and international airports
provides the opportunity for substantial risk reduction and savings
through operational efficiencies. Why has the S&T Directorate not
designated this as an Apex project? What discussions has the S&T
Directorate had with TSA leadership to identify whether this should
become an Apex project?
Answer. Response was not received at the time of publication.
Question Submitted by Ranking Member Bennie G. Thompson for Paul Benda
Question. The Under Secretary for Science and Technology has stated
that the S&T Directorate should play a greater role in the acquisition
of technologies by DHS components. Would an expanded role for the S&T
Directorate in the acquisition of technologies by TSA increase the
likelihood that acquired technologies will succeed in the field? Would
such an expanded role for the S&T Directorate result in a more
cumbersome process for private-sector vendors seeking to work with the
Department on their security technologies?
Answer. Response was not received at the time of publication.
Question Submitted by Ranking Member Sheila Jackson Lee for Paul Benda
Question. How did the Detroit Flight 253 incident and the discovery
of the Yemen cargo plot impact priorities and planning at the
Transportation Security Lab and throughout the Science and Technology
Directorate? How will the proposed budget cuts affect that work?
Answer. Response was not received at the time of publication.
Question Submitted by Ranking Member Sheila Jackson Lee for Charles K.
Edwards
Question. In your testimony you state that while DHS has taken
steps to improve its acquisition oversight processes and controls,
additional areas for improvement remain. What is the single most
important improvement you believe needs to be implemented? Does the
Department have a plan in place to implement the needed improvements?
Answer. The Department of Homeland Security (DHS) continues to face
challenges associated with implementing a fully integrated acquisition
function. A successful acquisition process requires an effective
acquisition management infrastructure. Acquisition management is a
complex process that goes beyond simply awarding a contract. It begins
with the identification of a mission need; continues with strategy
development, while balancing cost, schedule, and performance; and
concludes with contract closeout. It also includes managing operational
and life cycle requirements, to include formulating concepts, assessing
tradeoffs, and managing programs risks. We have performed various
audits over the years that have identified the Department's
improvements and challenges, which we outline annually in the Major
Management Challenges Facing the Department of Homeland Security
report. The one recurring need over the last several years has been an
emphasis on further development and refinement of oversight and
internal controls.
The Department's most recent major management challenges report,
OIG-12-08, dated November 2011, identified several areas which needed
improvement. The Department concurred with our assessment and continues
to make refinements and improvements. However, to address your specific
request we refer you to our March 2011 audit report, DHS Department-
wide Management of Detection Equipment, OIG-11-47. In this report, we
determined that the Department could improve its management of
detection equipment by applying the principles of strategic sourcing.
Strategic sourcing requires that the Department standardize equipment
purchases, identify common mission requirements among components, and
develop standard data elements for managing the inventory accounts.
Although we made these recommendations to address improving the
Department's management of detection equipment, the strategic sourcing/
logistics concepts imbedded as best business practices can be applied
across the Department. These best practices provide for efficiencies of
purchasing scale; serve to create greater competitive opportunities for
more businesses, both large and small; and establish a foundation for
standardization and transparency. The Department is in the process of
implementing these recommendations by establishing a Steering Committee
and a commodity working group that has begun to identify specific
missions and needs. We will continue to monitor the progress of the
Department in its actions to implement these recommendations and will
encourage its leadership to apply these principles across its
components and commodities.
We have also continued to audit the Department's acquisition
process, both system-wide and in specific component programs, and we
plan to release those reports in the second quarter of 2012.