    [Analytical Perspectives]
    [Crosscutting Programs]
    [3. Homeland Security Funding Analysis]
    [From the U.S. Government Printing Office, www.gpo.gov]

      Since the terrorist attacks of September 11, 2001, America has engaged
    in a broad, determined effort to thwart terrorism, identifying and
    pursuing terrorists abroad and implementing an array of measures to
    secure our citizens and resources at home. The Administration has worked
    with the Congress to reorganize the Federal Government, acquire
    countermeasures to biological weapons, enhance security at our borders,
    transportation systems, critical infrastructure and local communities,
    and strengthen America's preparedness and response capabilities. To
    build upon these accomplishments, the President signed landmark
    legislation to reorganize America's intelligence agencies and implement
    other recommendations of the 9/11 Commission, the Intelligence Reform
    and Terrorism Prevention Act of 2004. These are elements of our national
    homeland security strategy--to prevent terrorist attacks within the
    United States, reduce America's vulnerability to terrorism, and minimize
    the damage from attacks that may occur--involving every level of
    government, the private sector, and individual citizens. Since September
    11th, homeland security has remained a major policy focus for all levels
    of government, and one of the President's highest priorities.
      To underscore the importance of homeland security as a crosscutting
    Government-wide function, section 889 of the Homeland Security Act of
    2002 requires a homeland security funding analysis to be incorporated in
    the President's Budget. This analysis addresses that legislative
    requirement. It covers the homeland security funding and activities of
    all Federal agencies, not only those carried out by the Department of
    Homeland Security (DHS), and discusses State, local, and private sector
    expenditures. In addition, not all activities carried out by DHS
    constitute homeland security funding (e.g., Coast Guard search and
    rescue activities), so DHS estimates in this section do not represent
    the entire DHS budget.

                              Federal Expenditures

      The Federal spending estimates in this analysis utilize funding and
    programmatic information collected on the Executive Branch's homeland
    security efforts. \1\ Throughout the budget formulation process, the
    Office of Management and Budget (OMB) collects three-year funding
    estimates and associated programmatic information from all Federal
    agencies with homeland security responsibilities. These estimates do not
    include the efforts of the Legislative or Judicial branches. Information
    in this chapter is augmented by a detailed appendix of account-level
    funding estimates, which is available on the Analytical Perspectives CD
    ROM.
    ---------------------------------------------------------------------------
      \1\ All data in the Federal expenditures section are based on the
    President's policy for the 2006 Budget. Additional policy and baseline
    data is presented in the ``Additional Tables'' section. Due to rounding
    differences, data in this section may not add to totals in other Budget
    volumes.
    ---------------------------------------------------------------------------
      To compile these data, agencies report information using standardized
    definitions for homeland security. The data provided by the agencies are
    developed at the ``activity level,'' which is a set of like programs or
    projects that make up a coherent effort, at a level of detail sufficient
    to analyze total governmental spending on homeland security.
      To the extent possible, this analysis maintains programmatic and
    funding consistency with previous estimates. Some discrepancies from
    data reported in earlier years arise due to agencies' improved ability
    to extract terrorism-related activities from host programs and refine
    their characterizations. \2\ As in the Budget, where appropriate, the
    data is also updated to reflect agency activities, Congressional action,
    and technical re-estimates. In addition, the Administration may refine
    definitions or mission area estimates over time based on additional
    analysis or changes in the way specific activities are characterized,
    aggregated, or disaggregated. Activities in many of the mission areas
    are closely related. For example, information gleaned from activities in
    the intelligence and warning category may be utilized to inform law
    enforcement activities in the domestic counterterrorism category.
    Augmentation of pharmaceutical stockpiles, categorized as emergency
    preparedness and response, may address agents that represent
    catastrophic threats.
    ---------------------------------------------------------------------------
      \2\ For the estimates in this section, the significant changes of this
    type are: 1) a change to estimates in the U.S. Coast Guard to reflect
    distribution of defense-related funding consistent with appropriations,
    2) a change to estimates to capture additional resources for plant and
    animal monitoring and surveillance programs in the Animal and Plant
    Health Inspection Service, and 3) a change to estimates to remove
    resources for the Health Resources and Services Administration's poison
    control activities. Historical data has been adjusted to reflect these
    changes. Major changes to the classification of homeland security
    activities will be reviewed pursuant to section 889 of the Homeland
    Security Act of 2002.
    ---------------------------------------------------------------------------
      Total funding for homeland security has grown significantly since the
    attacks of September 11, 2001. For 2006, the President's Budget includes
    $49.9 billion for homeland security activities, a $3.9 billion (8.6
    percent) increase over the 2005 level, excluding DHS' Project BioShield.
    \3\ The 2006 level is more than $29 billion above, or approximately 240
    percent, of the 2002 level of $20.7 billion. Excluding mandatory
    funding, the Department of Defense, and DHS' Project BioShield, the 2006
    Budget proposes a gross discretionary increase of $2.9 billion (8.3
    percent) over the 2005 level. The Budget also proposes to increase
    aviation security fees to allow the Government to recover most of the
    cost of Federal aviation screening operations. Including this

    [[Page 38]]

    fee proposal, the net non-defense discretionary increase from 2005 to
    2006 is 3.1 percent.
    ---------------------------------------------------------------------------
      \3\ The Department of Homeland Security Appropriations Act, 2004,
    provided $5.6 billion for Project BioShield, to remain available through
    2013. Pursuant to that Act, specific amounts became available in 2004
    ($0.9 billion) and 2005 ($2.5 billion) that are intended to cover
    programmatic activities through 2008. The remainder will become
    available in 2009. Including this uneven funding stream can distort
    year-over-year comparisons.
    ---------------------------------------------------------------------------
      A total of 33 agencies comprise Federal homeland security funding. Of
    those, five agencies--the Departments of Homeland Security (DHS),
    Defense (DOD), Health and Human Services (HHS), Justice (DOJ) and Energy
    (DOE)--account for approximately 92 percent of total Government-wide
    homeland security funding in 2006:

                                     Table 3-1.  HOMELAND SECURITY FUNDING BY AGENCY
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                          Budget Authority                         Enacted    Supplemental   Enacted *     Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................        411.1  ............        599.9        703.7
    Department of Commerce.....................................        124.6  ............        166.7        183.2
    Department of Defense......................................      7,024.0  ............      8,570.1      9,513.5
    Department of Education....................................          8.0  ............         23.8         22.7
    Department of Energy.......................................      1,364.0  ............      1,562.0      1,665.8
    Department of Health and Human Services....................      4,062.2  ............      4,230.3      4,406.7
    Department of Homeland Security............................     22,832.7         90.7      24,870.7     27,332.5
    Department of Housing and Urban Development................          1.7  ............          2.0          1.9
    Department of the Interior.................................         82.9  ............         65.0         57.1
    Department of Justice......................................      2,164.9         15.5       2,677.8      3,103.6
    Department of Labor........................................         52.4  ............         56.1         47.9
    Department of State........................................        696.4  ............        824.1        938.1
    Department of Transportation...............................        283.5  ............        181.7        191.5
    Department of the Treasury.................................         90.4  ............        101.1        110.5
    Department of Veterans Affairs.............................        271.3  ............        280.4        298.9
    Corps of Engineers.........................................        101.5  ............         89.0         72.0
    Environmental Protection Agency............................        131.0  ............        106.8        184.3
    Executive Office of the President..........................         35.0  ............         29.5         22.4
    General Services Administration............................         78.9  ............         65.2         79.8
    National Aeronautics and Space Administration..............        207.0  ............        218.0        205.0
    National Science Foundation................................        340.0  ............        342.2        344.2
    Office of Personnel Management.............................          3.0  ............          3.0          3.8
    Social Security Administration.............................        143.4  ............        159.4        177.5
    District of Columbia.......................................         19.0  ............         15.0         15.0
    Federal Communications Commission..........................          1.0  ............          1.6          3.5
    Intelligence Community Management Account..................          1.0  ............         72.4         55.8
    National Archives and Records Administration...............         16.0  ............         17.1         20.2
    Nuclear Regulatory Commission..............................         66.8  ............         59.2         61.0
    Postal Service.............................................  ...........  ............        503.0  ...........
    Securities and Exchange Commission.........................          5.0  ............          5.0          5.0
    Smithsonian Institution....................................         78.3  ............         75.0         86.6
    United States Holocaust Memorial Museum....................          8.0  ............          8.0          8.7
    Corporation for National and Community Service.............         22.8  ............         17.0         20.4
                                                                ----------------------------------------------------
    Total, Homeland Security Budget Authority..................     40,727.7        106.2      45,998.2     49,942.9

      Less Department of Defense...............................     -7,024.0  ............     -8,570.1     -9,513.5

                                                                ----------------------------------------------------
    Non-Defense Homeland Security Budget Authority excluding        33,703.7        106.2      37,428.1     40,429.5
     BioShield.................................................

      Less Fee-Funded Homeland Security Programs...............     -3,289.1  ............     -3,941.0     -5,889.5
      Less Mandatory Homeland Security Programs................     -1,940.2  ............     -2,225.1     -2,302.0

                                                                ----------------------------------------------------
    Net Non-Defense Discretionary, Homeland Security Budget         28,474.4        106.2      31,262.0     32,237.9
     Authority excluding BioShield.............................

      Plus BioShield...........................................        885.0  ............      2,508.0  ...........

    Net Non-Defense Discretionary, Homeland Security Budget         29,359.4        106.2      33,770.0     32,237.9
     Authority including BioShield.............................
                                                                ----------------------------------------------------
    Obligations Limitations
      Department of Transportation Obligations Limitation......        139.8  ............         57.7         54.6
    ----------------------------------------------------------------------------------------------------------------
    * Excludes $16M in supplemental appropriations provided to the Coast Guard in 2005.

      The growth in Federal homeland security funding is indicative of the
    efforts that have been initiated to secure our Nation. However, it
    should be recognized that fully developing the strategic capacity to
    protect America is a complex effort. There is a wide range of potential
    threats and risks from terrorism. To optimize limited resources and
    minimize the potential social costs to our free and open society,
    homeland security activities should be prioritized based on the highest
    threats and risks. Homeland security represents a partnership among the
    Federal Government, State and local govern

    [[Page 39]]

    ments, the private sector, and individual citizens, each with a unique
    role in protecting our Nation.
      The National Strategy for Homeland Security provides a framework for
    addressing these challenges. It guides the highest priority requirements
    for securing the Nation. As demonstrated below, the Federal Government
    has used the National Strategy to guide its homeland security efforts.
    For this analysis, agencies categorize their funding data based on the
    critical mission areas defined in the National Strategy: intelligence
    and warning, border and transportation security, domestic
    counterterrorism, protecting critical infrastructures and key assets,
    defending against catastrophic threats, and emergency preparedness and
    response. In all tables, classified funding for the Intelligence
    Community is combined with the Department of Defense and titled
    ``Department of Defense.''
      The National Strategy is a dynamic document; it includes actions that
    agencies use and must build upon to measure progress. In some cases,
    progress may be easily measured. In others, Federal agencies, along with
    State and local governments and the private sector, are working together
    to develop measurable goals. Finally, in some areas, Federal agencies
    and partners must continue to develop a better understanding of risks
    and threats--such as the biological agents most likely to be used by a
    terrorist group or the highest-risk critical infrastructure targets--in
    order to develop benchmarks.
      This chapter highlights some significant results from OMB's
    Performance Assessment Rating Tool (PART), as well as some major
    performance metrics and milestones. These are not an exhaustive list of
    homeland security PART results, measures, or milestones; nor are they
    exempt from the performance measurement challenges highlighted above.
    However, they do illustrate the Government's efforts in building a more
    robust architecture to measure homeland security performance.
      The following table summarizes funding levels by the National
    Strategy's mission areas; more detailed analysis is provided in
    subsequent mission-specific analysis sections.

                         Table 3-2.  HOMELAND SECURITY FUNDING BY NATIONAL STRATEGY MISSION AREA
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Intelligence and Warning...................................        242.2  ............        349.8        431.9
    Border and Transportation Security.........................     15,840.8         90.7      17,550.2     19,285.8
    Domestic Counterterrorism..................................      3,379.3         12.3       3,944.5      4,468.7
    Protecting Critical Infrastructure and Key Assets..........     12,279.1          2.5      14,939.4     15,632.2
    Defending Against Catastrophic Threats.....................      2,974.2          0.7       3,399.2      3,898.3
    Emergency Preparedness and Response........................      6,002.6  ............      5,765.2      6,121.6
    Other......................................................          9.6  ............         49.8        104.5
                                                                ----------------------------------------------------
      Total, Homeland Security Budget Authority................     40,727.7        106.2      45,998.2     49,942.9

      Plus BioShield...........................................        885.0  ............      2,508.0  ...........

                                                                ----------------------------------------------------
      Total, Homeland Security Budget Authority, including          41,612.7        106.2      48,506.2     49,942.9
       BioShield...............................................
    ----------------------------------------------------------------------------------------------------------------

    National Strategy Mission Area: Intelligence and Warning

      The intelligence and warning mission area covers activities to detect
    terrorist threats and disseminate terrorist-threat information. The
    category includes intelligence collection, risk analysis, and threat-
    vulnerability integration activities for preventing terrorist attacks.
    It also includes information sharing activities among Federal, State,
    and local governments, relevant private sector entities (particularly
    custodians of critical infrastructure), and the public at large. It does
    not include most foreign intelligence collection--although the resulting
    intelligence may inform homeland security activities--nor does it fully
    capture classified intelligence activities. In 2006, the bulk of the
    funding for intelligence and warning is in DHS (61 percent in 2006),
    primarily in the Information Analysis and Infrastructure Protection
    (IAIP) Directorate and the Secret Service, DOJ (21 percent in 2006),
    primarily in the Federal Bureau of Investigation (FBI), and the
    Intelligence Community Management Account (13 percent in 2006). 2006
    funding for intelligence and warning activities would increase by 23
    percent over the 2005 level.

                                      Table 3-3.  INTELLIGENCE AND WARNING FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................          0.8  ............          6.3         22.3
    Department of Homeland Security............................        236.0  ............        226.4        262.4
    Department of Justice......................................          2.0  ............         44.2         90.9
    Department of the Treasury.................................          2.5  ............          0.6          0.6
    Intelligence Community Management Account..................          1.0  ............         72.4         55.8
                                                                ----------------------------------------------------
      Total, Intelligence and Warning..........................        242.2  ............        349.8        431.9
    ----------------------------------------------------------------------------------------------------------------

      The major requirements addressed in the intelligence and warning
    mission area include:
        Unifying and enhancing intelligence and analytical
              capabilities to ensure officials have the information they
              need to prevent attacks; and
        Implementing the Homeland Security Advisory System and other
              information sharing and warning mechanisms to allow Federal,
              State, local, and private authorities to take action to
              prevent attacks and protect potential targets.
      The recently-passed Intelligence Reform and Terrorism Prevention Act
    of 2004, supported by executive orders on information sharing,
    management of the in

    [[Page 40]]

    telligence community, and the National Counterterrorism Center, will
    improve the Nation's intelligence and warning capabilities. The new
    Director of National Intelligence (DNI) is empowered to set collection
    and analysis priorities, which will help ensure that homeland security
    requirements are addressed. The DNI is also empowered to ensure that
    information sharing takes place across the intelligence community. These
    changes implement the recommendations of the 9/11 Commission, and should
    allow the intelligence community to ``connect the dots'' more
    effectively, develop a better integrated system for identifying and
    analyzing terrorist threats, and issue warnings more rapidly.
      In addition, the newly created National Counterterrorism Center (NCTC)
    is specifically chartered to centralize U.S. Government terrorism threat
    analysis and ensure that all agencies receive relevant analysis and
    information. The NCTC will serve as the primary organization in the U.S.
    Government for analyzing and integrating all intelligence pertaining to
    terrorism and counterterrorism (excepting purely domestic terrorism);
    operate as the central and shared knowledge bank on known and suspected
    terrorists and international terror groups; and ensure that agencies, as
    appropriate, have access to and receive the all-source intelligence
    support needed to execute their counterterrorism plans or perform
    independent, alternative analysis. NCTC is tasked to coordinate
    counterterrorism operations on a global basis and develop strategic,
    operational plans for the Global War on Terrorism. The NCTC will use
    this capability to allocate requirements to the agencies with the assets
    and capabilities to address them. NCTC will not direct operations,
    leaving mission execution to the appropriate agencies. This structure
    will ensure that the chain of command remains intact and prevent
    bureaucratic micromanagement of counterterrorism missions. Taken
    together, the creation of the NCTC and recent legislation and executive
    orders will ensure that counterterrorism assets are better allocated and
    coordinated to produce improved indications and warning intelligence to
    benefit homeland security.
      These structural changes complement ongoing efforts to improve
    information sharing. The Information Systems Council (ISC) established
    by Executive Order 13356, ``Strengthening of Terrorism Information to
    Protect Americans,'' was directed to establish an interoperable
    terrorism ``environment'' to automate information sharing among the
    homeland security, law enforcement, and intelligence communities. The
    ISC recently reported to the President a plan to improve sharing of
    terrorism information through the establishment of an interoperable
    terrorism information sharing ``environment.'' The proposed plan
    includes a vision for the future of the environment, including
    additional functions and capabilities, and a four-phase plan for moving
    forward, including near-term solutions to address gaps. The environment
    will enable the interchange of information between appropriate Federal,
    State, and local authorities and the private sector while protecting the
    privacy rights and civil liberties of Americans.
      As discussed above, the DNI and the NCTC will continue to utilize the
    unique assets and capabilities of other Government agencies--some of
    which are reorganizing to improve these capabilities and better
    interface with the new intelligence structure. After 9/11, the FBI
    created an Office of Intelligence to establish intelligence requirements
    and coordinate information collection and sharing. The 2005 Department
    of Justice Appropriations Act and the Intelligence Reform and Terrorism
    Prevention Act directed the FBI to re-designate the Office of
    Intelligence as the Directorate of Intelligence. The new Directorate
    supervises all national intelligence programs of the FBI, oversees field
    intelligence operations, and is developing an FBI intelligence career
    service. The 2006 Budget provides $117 million in new funding for FBI to
    enhance its intelligence programs. Performance measures that will be
    used by the FBI program include the percentage of intelligence products
    meeting all standards and the percentage of investigations that are
    intelligence-based.
      The Department of Homeland Security's Information Analysis and
    Infrastructure Protection Directorate (IAIP) will also contribute to the
    new intelligence structure. By maintaining and expanding its partnership
    the NCTC, IAIP will continue to coordinate its activities with other
    members within the newly reorganized intelligence community. IAIP was
    established as part of DHS to fill a unique role: mapping threat
    information against our nation's vulnerabilities and working with the
    Federal, State, and local government officials and private sector
    custodians of critical infrastructure to mitigate those vulnerabilities.
    IAIP's Office of Information Analysis, which is the Department's
    intelligence division, centralizes analysis and information about

    [[Page 41]]

    threats to homeland security. IAIP is also the focal point for
    disseminating information to states and local entities. For example,
    IAIP is connected to homeland security directors of States and
    territories through the Homeland Security Information Network (HSIN).
    All fifty States and major urban areas are now connected to HSIN. In
    2006, HSIN will be rolled out to major counties as well. In addition,
    IAIP's analysis informs the Secretary as he administers the Homeland
    Security Advisory System.

    National Strategy Mission Area: Border and Transportation Security

      This mission area covers activities to protect border and
    transportation systems, such as screening airport passengers, detecting
    dangerous materials at ports overseas and at U.S. ports-of-entry, and
    patrolling our coasts and the land between ports-of-entry. The majority
    of funding in this mission area ($18.2 billion, or 94 percent, in 2006)
    is in DHS, largely for the U.S. Customs and Border Protection (CBP), the
    Transportation Security Administration (TSA), and the Coast Guard. Other
    DHS bureaus and other Departments, such as State and Agriculture, also
    play significant roles. The President's 2006 request would increase
    funding for border and transportation security activities by 10 percent
    over the 2005 level.

                                 Table 3-4.  BORDER AND TRANSPORTATION SECURITY FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................        147.9  ............        163.1        164.2
    Department of Homeland Security............................     14,941.7         90.7      16,560.6     18,207.3
    Department of Justice......................................         20.1  ............         34.5         20.8
    Department of State........................................        663.9  ............        778.2        878.4
    Department of Transportation...............................         67.2  ............         13.9         15.1
                                                                ----------------------------------------------------
      Total, Border and Transportation Security................     15,840.8         90.7      17,550.2     19,285.8
    ----------------------------------------------------------------------------------------------------------------

      Securing our borders and transportation systems is a complex task.
    Security enhancements in one area may make another avenue more
    attractive to terrorists. Therefore, our border and transportation
    security strategy aims to make the U.S. borders ``smarter''--targeting
    resources toward the highest risks and sharing information so that
    frontline personnel can stay ahead of potential adversaries--while
    facilitating the flow of legitimate visitors and commerce. The creation
    of DHS, which unified the Federal Government's major border and
    transportation security resources, facilitates the integration of risk
    targeting systems and ensures greater accountability in border and
    transportation security. Rather than having separate systems for
    managing goods, people, and agricultural products, one agency is now
    accountable for ensuring that there is one cohesive border management
    system.
      In 2005 and 2006, the Administration will focus on implementing
    Homeland Security Presidential Directive (HSPD) 11, Comprehensive
    Terrorist-Related Screening Procedures. Although resources related to
    screening are spread throughout mission areas, the majority are captured
    in border and transportation security because of the sizable Federal
    efforts to screen people, cargo, and conveyances as they cross U.S.
    borders or travel through U.S. transportation systems. A cohesive
    screening system is a key element of a smart border strategy.
      Internally, DHS will modify its own organizational structure to
    consolidate screening programs previously spread throughout the
    Department's components. The new Screening Coordination and Operations
    Office (SCO) will manage the two DHS centerpiece screening programs: US-
    VISIT, which screens international travelers arriving at our ports of
    entry; and the Secure Flight program, which conducts automated screening
    of all domestic aviation passengers. At least nine other existing
    programs will also be consolidated, including the Free and Secure Trade
    (FAST) and the Transportation Worker Identification (TWIC) card
    programs. DHS is also leading the HSPD-11 interagency effort to
    implement a coordinated approach to terrorist-related screening in
    immigration, law enforcement, intelligence, counterintelligence, border
    and transportation systems, and critical infrastructure. This effort
    covers diverse areas, from information sharing to screener training. SCO
    will play a central coordinating role. The 2006 Budget includes more
    than $800 million in discretionary, fee-funded, and mandatory resources
    to support SCO.
      Key to the Federal government's screening of international visitors is
    the US-VISIT program, which will be incorporated into SCO. US-VISIT is
    designed to expedite the clearance of legitimate travelers while
    identifying and denying clearance to those who may intend to do harm. In
    2004 and 2005 the first phases of US-VISIT were successfully deployed.
    The 2006 Budget includes a $50 million increase for accelerated
    deployment of US-VISIT at land border ports of entry and for enhancing
    border personnel's access to immigration, criminal, and terrorist
    information. Through 2006, over $1.4 billion will be appropriated to
    support this initiative.
      In the area of aviation security, the Administration continues to
    strengthen multiple layers of security implemented in the wake of the
    September 11th attacks. The Federal Government will continue to improve
    the

    [[Page 42]]

    airport screening system to ensure that it provides effective security
    with less bother to travelers. TSA will refine its training programs and
    screening procedures to ensure a balance among security needs, screening
    efficiency, and traveler privacy. While maintaining the more than 10,000
    screening devices at 448 airports, TSA will also begin to upgrade
    equipment and address technology gaps, such as screening for explosives
    on higher risk passengers and property. TSA will receive an increase of
    more than $400 million over 2005 for aviation security. Improved
    domestic and international passenger prescreening systems and processes
    will be fully implemented in 2006 to ensure that higher risk passengers
    receive scrutiny before boarding aircraft. The Budget also proposes to
    set aviation security fees at a level that allows the Government to
    recover most of the cost of Federal aviation screening operations.
      Outside of passenger and baggage screening, DHS has recently proposed
    a comprehensive set of air cargo security requirements. The rulemaking
    process should be completed this year. The Budget will support a strong
    air cargo prescreening and regulatory enforcement program in CBP and
    TSA, and air cargo technology research and development program in the
    DHS Science and Technology (S&T) Directorate. In addition, the S&T
    Directorate will continue its R&D program on the viability of
    countermeasures that could be placed on commercial aircraft to defend
    against the threat of shoulder-fired missiles. The Budget provides $110
    million to test these systems to determine operational, safety, and
    reliability issues.
      The security of our seaports is critical since terrorists may seek to
    use them to enter the country or introduce weapons or other dangerous
    materials. With 95 percent of all U.S. cargo passing through the
    Nation's 361 ports, a terrorist attack on a seaport could be
    economically devastating. The Maritime Transportation Security Act
    (MTSA) and its implementing regulations, issued by DHS in October 2003,
    require ports, vessels, and facilities to conduct security assessments.
    In 2006, the Coast Guard will continue implementation of MTSA to ensure
    compliance with port and vessel security standards and regulations.
      The 2006 Budget provides more than $2 billion for port security across
    DHS, including $1.9 billion in discretionary funding for Coast Guard
    port security activities such as Maritime Safety and Security Teams and
    harbor patrols for ports with liquefied natural gas terminals. In
    addition, the Coast Guard budget funds operations to strengthen
    intelligence collection and surveillance capabilities in the maritime
    environment, both of which contribute to the broader Coast Guard effort
    to enhance Maritime Domain Awareness.
      To secure our borders while also maintaining openness to travel and
    trade, CBP utilizes a risk-based, layered security approach. Overall
    funding for CBP homeland security activities in 2006 would increase by
    more than $150 million over the 2005 level, with enhancements supporting
    additional inspectors at ports-of-entry, additional Border Patrol
    agents, inspection equipment, enhancements to tracking and targeting
    databases, and information technology upgrades. Further, through its
    Container Security Initiative (CSI), CBP has addressed an area of
    identified risk--the security of international shipping containers. CSI
    screens cargo containers at foreign ports before the containers are
    placed on ships bound for the United States. The 2006 Budget requests
    $138 million for CSI.
      A major focus across mission areas for 2006 is the effort to upgrade
    our radiological and nuclear detection capability. The 2006 Budget
    provides $178 million to CBP (along with an increase for radiological
    and nuclear detection research, discussed below) to defend against
    radiological and nuclear threats by deploying current non-intrusive
    inspection technologies and piloting next-generation radiation detection
    technologies. The 2006 PART on the Inspection Technology program found
    that while the program is lacking in specific targets to measure long-
    term success, it has a very clear program purpose and sound management.
      To ensure detention and removal of illegal aliens present in the U.S.,
    the 2006 Budget also supports a $176 million increase for the Detention
    and Removal Program. This includes funding to expand the program to
    apprehend alien fugitives and to increase efforts to ensure that aliens
    convicted of crimes in the U.S. are deported directly from correctional
    institutions after their time is served. A 2005 PART found this program
    moderately effective because DHS Immigration and Customs Enforcement
    (ICE) has reorganized its operations and engaged in significant
    strategic and performance planning efforts to identify ambitious goals
    to improve program performance.
      The State Department is the second largest agency contributor to
    border and transportation security. The Bureau of Consular Affairs
    Border Security program consists of visa, passport and American Citizen
    Services programs. The State Department Border Security program
    underwent a PART analysis in 2004, 2005 and 2006 budgets, and was found
    to be effective. The analysis determined that State, working in
    coordination with the other border and transportation security agencies,
    has effectively targeted programs and funding, established achievable
    annual and long term goals as well as developed thoughtful policies that
    not only secure processes related to screening of all travelers to the
    US but also facilitate legitimate travel. The 2006 Budget includes
    funding in State for technology related to increased interviews,
    screening, and information sharing between Federal agencies on visa
    applicants; the development and production of new machine-readable
    biometric U.S. passports; and for increased interoperability of border
    security and counterterrorism systems between State, DHS, and FBI.

    [[Page 43]]

    National Strategy Mission Area: Domestic Counterterrorism

      Funding in the domestic counterterrorism mission area covers Federal
    and Federally-supported efforts to identify, thwart, and prosecute
    terrorists in the United States. The largest contributors to the
    domestic counterterrorism mission are law enforcement organizations: the
    Department of Justice (largely for the FBI) and DHS (largely for ICE),
    accounting for 53 and 45 percent of funding for 2006, respectively. The
    President's 2006 request would increase funding for domestic
    counterterrorism activities by 13 percent over the 2005 level.

                                       Table 3-5.  DOMESTIC COUNTERRORISM FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Homeland Security............................      1,703.7  ............      1,867.0      2,008.8
    Department of Justice......................................      1,608.4         12.3       1,999.0      2,372.7
    Department of Transportation...............................         21.0  ............         20.0         22.0
    Department of the Treasury.................................         45.2  ............         54.9         61.0
    Social Security Administration.............................          1.0  ............          3.7          4.2
                                                                ----------------------------------------------------
      Total, Domestic Counterterrorism.........................      3,379.3         12.3       3,944.5      4,468.7
    ----------------------------------------------------------------------------------------------------------------

      Since the attacks of September 11th, preventing and interdicting
    terrorist activity within the United States has become a priority for
    law enforcement at all levels of government. The major requirements
    addressed in the domestic counterterrorism mission area include:
        Developing a proactive law enforcement capability to prevent
              terrorist attacks.
        Apprehending potential terrorists.
        Improving law enforcement cooperation and information
              sharing to enhance domestic counterterrorism efforts across
              all levels of government.
      Over the past three years, FBI has transformed its organization and
    established priorities to ensure that protecting the U.S. from terrorist
    attack is its primary focus. To support this transformation, resources
    have been shifted from lower priority programs, counterterrorism
    analytical capability has been enhanced, additional field investigators
    have been hired, and headquarters oversight and management of terrorism
    cases has been strengthened. Overall, FBI resources in the domestic
    counterterrorism category have increased from $0.9 billion in 2002 to
    over $1.7 billion in 2006, with the 2006 Budget providing an increase of
    approximately $300 million over the 2005 level. The increase will
    support a range of activities, such as counterterrorism investigations
    and countering cyber crime. To specifically promote information sharing
    efforts, it includes an additional $17 million for FBI to upgrade its
    Integrated Automated Fingerprint Identification System. This will
    enhance system capacity, speed, and capabilities, and will promote
    information sharing between the FBI, DHS, and other agencies.
      By merging existing immigration and customs enforcement functions into
    ICE, the Department of Homeland Security created one of America's
    largest law enforcement agencies. The Nation is better prepared to
    apprehend potential terrorists because DHS has combined the information
    and resources to identify and investigate illegal activities--such as
    smuggling, identity theft, and money laundering, and trafficking in
    dangerous materials. The 2006 PART found that the investigative arm of
    ICE, the Office of Investigations, has made significant progress in the
    integration of former customs and immigration investigators, and has
    started to reap the benefits of additional investigative authorities.
    However, the program must institute stronger financial and management
    controls to ensure appropriate expenditure and budgeting of resources
    and to hold managers and agency partners accountable for performance
    results. The 2006 Budget provides an increase of $34 million to expand
    these enforcement activities.
      The interagency Terrorist Screening Center (TSC) is a hub for domestic
    counterterrorism activity. TSC was established in September 2003
    pursuant to HSPD-6 in order to consolidate terror screening watch lists
    and to support Federal screeners worldwide. In its first year, TSC has
    created a single point for terrorist screening data; established a
    round-the-clock call center for officials encountering suspects;
    coordinated response for Federal, State, and local law enforcement; and
    instituted a formal process for tracking encounters. TSC staff, who
    include participants from DOD, DHS, DOJ, State, and other agencies,
    currently field nearly 100 calls per day from Federal, State, and local
    law enforcement representatives. The 2006 Budget provides $104 million
    for TSC, a $75 million increase over 2005, to enable TSC to meet its
    increasing responsibilities, particularly in support of the DHS Secure
    Flight program.

    [[Page 44]]

    National Strategy Mission Area: Protecting Critical Infrastructure and
    Key Assets

      Funding in the protecting critical infrastructure and key assets
    mission area captures the efforts of the U.S. Government to secure the
    Nation's infrastructure, including information infrastructure, from
    terrorist attacks. Protecting the Nation's key assets is a complex
    challenge because an estimated more than 85 percent are not Federally-
    owned. DOD reports the largest share of funding in this category for
    2006 ($8.7 billion, or 56 percent), and includes programs focusing on
    physical security and improving the military's ability to prevent or
    mitigate the consequences of attacks against personnel and bases. DHS
    has overall responsibility for prioritizing and executing infrastructure
    protection activities at a national level and accounts for $2.8 billion
    (18 percent) of 2006 funding. A total of 26 other agencies report
    funding to protect their own assets and to work with States, localities,
    and the private sector to reduce vulnerabilities in their areas of
    expertise. The President's 2006 request increases funding for activities
    to protect critical infrastructure and key assets by $0.7 billion (5
    percent) over the 2005 level.
      Securing America's critical infrastructure and key assets is a complex
    task. The major requirements include:
        Unifying disparate efforts to protect critical
              infrastructure across the Federal Government, and with State,
              local, and private stakeholders.
        Building and maintaining a complete and accurate assessment
              of America's critical infrastructure and key assets and
              prioritizing protective action based on risk.
        Enabling effective partnerships to protect critical
              infrastructure.
        Reducing threats and vulnerabilities in cyberspace.

                          Table 3-6.  PROTECTING CRITICAL INFRASTRUCTURE AND KEY ASSETS FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................         36.9  ............        150.7        129.3
    Department of Defense......................................      6,543.8  ............      7,916.9      8,700.8
    Department of Energy.......................................      1,256.4  ............      1,456.1      1,481.0
    Department of Health and Human Services....................        162.8  ............        168.3        170.3
    Department of Homeland Security............................      2,128.3  ............      2,585.9      2,820.0
    Department of Justice......................................        409.2          2.5         455.8        566.1
    Department of Transportation...............................        180.1  ............        137.0        141.2
    Department of Veterans Affairs.............................        239.2  ............        242.9        262.3
    National Aeronautics and Space Administration..............        207.0  ............        218.0        205.0
    National Science Foundation................................        313.0  ............        315.2        317.2
    Social Security Administration.............................        142.1  ............        155.0        172.6
    Postal Service.............................................  ...........  ............        503.0  ...........
    Other Agencies.............................................        660.4  ............        634.6        666.3
                                                                ----------------------------------------------------
      Total, Protecting Critical Infrastructure and Key Assets.     12,279.1          2.5      14,939.4     15,632.2
    ----------------------------------------------------------------------------------------------------------------

      IAIP is the focal point for DHS infrastructure protection efforts, and
    is responsible for prioritizing and addressing requirements at a
    national level. IAIP maintains the National Asset Database, which
    catalogues critical infrastructure and key assets. IAIP leverages
    tactical intelligence with a risk-based strategy that identifies
    critical infrastructures in targeted areas, assesses the vulnerabilities
    of that infrastructure, and recommends protective measures. IAIP
    conducts site visits and assessments of more than 1,000 sites each year,
    and has used this information to develop site security guidelines for
    nuclear power plants and chemical facilities. Security guidelines are
    also being developed for all infrastructure sectors, covering spent
    nuclear fuel, petroleum refineries, natural gas facilities, and
    railroads, for example. In addition, IAIP trains State and local
    officials and infrastructure owners to improve security in the areas
    immediately surrounding critical sites. The 2006 Budget provides $530
    million for IAIP activities in the protecting critical infrastructures
    and key assets mission area. In addition, the Administration proposes
    $600 million for Targeted Infrastructure Protection (TIP) grants.
    Awarded through the Office of State and Local Government Coordination
    and Preparedness, TIP grants and assistance will supplement state and
    local infrastructure protection efforts, especially detection and
    security investments.
      Cyberspace security is a key element of infrastructure protection
    because the internet and other computer systems link infrastructure
    sectors. The consequences of a cyber attack could cascade across the
    economy, imperiling public safety and national security. To address this
    threat, DHS has established the National Cyber Security Division (NCSD)
    to identify, analyze and reduce cyber threats and vulnerabilities,
    coordinate incident response, and provide technical assistance. Since
    its formal establishment in 2003, NCSD has worked with the private
    sector to improve security of the Na

    [[Page 45]]

    tion's information infrastructure. For example, it coordinated the
    response and mitigation of the Blaster worm and SoBig virus. NCSD has
    also established the U.S. Computer Emergency Response Team (US-CERT).
    US-CERT supports watch and warning capability responsible for tracking
    incident and trend data, ranking associated severity, and generating
    real-time alerts. $73 million is requested for the NCSD in 2006.
      HSPD-7, signed in December 2003, established a national policy to
    protect critical infrastructures and key resources from attack, ensure
    the delivery of essential goods and services, and maintain public safety
    and security. Under HSPD-7, DHS is responsible for coordinating Federal
    critical infrastructure protection efforts. To provide a consistent
    structure to integrate critical infrastructure protection, DHS has an
    interim National Infrastructure Protection Plan. Under the plan's
    framework, DHS will coordinate the infrastructure protection efforts of
    other Federal departments and agencies. A number of agencies rely on
    specialized expertise and long-standing relationships with industry in
    conducting infrastructure protection activities.
      Recognizing that each infrastructure sector possesses it own unique
    characteristics, a sector-specific agency has been designated to oversee
    infrastructure protection efforts for each sector. Consequently, sector-
    specific agencies are pursuing infrastructure protection efforts in
    concert with DHS. For example, the Department of Energy is coordinating
    protection activities within the energy sector. The Department of
    Agriculture is protecting agricultural resources, a source of essential
    commodities, through research and testing programs. There are 13
    critical infrastructure sectors and nine sector-specific agencies.
      The Environmental Protection Agency (EPA), the water sector-specific
    agency under HSPD-7, guides the protection of water infrastructure
    through training and technical support for water utilities and grants
    for State water security coordinators. In 2006, EPA will address the
    HSPD-9 requirement to lead the development of surveillance and
    monitoring systems for water quality. EPA will introduce Water Sentinel,
    a program to develop and demonstrate cost-effective, real-time sampling
    and analysis capabilities at critical points in a water system for early
    detection of disease, pest, or poisonous agents. The Administration's
    request for $44 million in 2006 will fund Water Sentinel as a pilot
    program in five major cities.

    National Strategy Mission Area: Defending Against Catastrophic Threats

      The defending against catastrophic threats mission area covers
    activities to research, develop, and deploy technologies, systems, and
    medical measures to detect and counter the threat of chemical,
    biological, radiological, and nuclear (CBRN) weapons. The agencies with
    the most significant resources in this category are HHS ($2.0 billion,
    or 51 percent, of the 2006 total), largely for research in the National
    Institutes of Health, and in DHS, mostly for the Directorate of Science
    and Technology (S&T) ($1.2 billion, or 31 percent, of the 2006 total),
    to help develop and field technologies to counter CBRN threats. The
    President's 2006 request would increase funding for activities defending
    against catastrophic threats by 15 percent over the 2005 level.
      The major requirements addressed in this mission area include:
        Developing countermeasures, including broad spectrum
              vaccines, antimicrobials, and antidotes.
        Preventing terrorist use of CBRN weapons through detection
              systems and procedures, and improving decontamination
              techniques.
      A key element in addressing these requirements is developing and
    maintaining adequate countermeasures for a CBRN attack. This not only
    means stockpiling countermeasures that are currently available, but
    developing new countermeasures for agents that currently have none and
    next-generation countermeasures that are safer and more effective than
    those that presently exist. Also, unlike an attack with conventional
    weapons, a CBRN attack may not be immediately apparent. Working to
    ensure earlier detection and characterization of an attack helps protect
    and save lives.

                               Table 3-7.  DEFENDING AGAINST CATASTROPHIC THREATS FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................        168.2  ............        222.7        317.2
    Department of Commerce.....................................         60.0  ............         73.4         84.7
    Department of Defense......................................        146.8  ............        178.2        158.9
    Department of Energy.......................................  ...........  ............          7.5         62.8
    Department of Health and Human Services....................      1,754.1  ............      1,901.8      1,971.5
    Department of Homeland Security............................        774.0  ............        936.1      1,212.1
    Department of Justice......................................         27.9          0.7          33.5         43.0
    National Science Foundation................................         27.0  ............         27.0         27.0
    Nuclear Regulatory Commission..............................         16.2  ............         19.0         21.2
                                                                ----------------------------------------------------
      Total, Defending Against Catastrophic Threats............      2,974.2          0.7       3,399.2      3,898.3
    ----------------------------------------------------------------------------------------------------------------

    [[Page 46]]

      The Federal Government is addressing these requirements. The DHS
    Biological Countermeasures Office budget request is $385 million in
    2006, a $22 million increase over 2005. This program received an
    effective PART rating, demonstrating significant accomplishments for a
    new program. Within the Biological Countermeasures Office, new vaccine
    research funds will target specific vaccines that can be used to defend
    our food supply from the intentional or accidental introduction of
    foreign animal diseases into the country. These vaccines will help
    protect the Nation from the catastrophic economic consequences that a
    major disease outbreak would cause. Funds are also requested for a
    National Agrodefense Facility that will be able to analyze pathogens in
    large animals. The 2006 Budget also includes $59 million for the
    Department of Agriculture to complete a state-of-the-art animal disease
    research and diagnostic facility at Ames, Iowa.
      The Budget continues to invest in efforts to decrease the time between
    an attack and implementation of Federal, State and local response
    protocols. The Science and Technology Directorate will expand and
    enhance the BioWatch environmental monitoring program, which samples and
    analyzes air in over 30 metropolitan areas to continually check for
    dangerous biological agents. The program is designed to provide early
    warning of a large-scale biological weapon attack, allowing the
    distribution of life-saving treatment and preventative measures before
    the development of serious and widespread illnesses.
      The Administration maintains HHS' investment in developing medical
    countermeasures to CBRN threats, investing nearly $1.8 billion, an
    increase of $56 million over 2005 and $1.7 billion over the level prior
    to September 11th (this includes funding for programs focused on
    chemical and radiological and nuclear countermeasures referenced below).
    HHS will continue to improve human health surveillance with $79 million
    dedicated to the BioSense program (collecting information from
    hospitals, emergency departments, and laboratories to identify ``real-
    time'' trends), increasing laboratory capacity, and augmenting the
    number and quality of border health and quarantine stations. The Food
    and Drug Administration and the U.S. Department of Agriculture will also
    conduct surveillance to ensure the security of the food supply.
    Information collected from these programs will be disseminated to the
    National Biosurveillance Integration Center at DHS.
      In addition, the Administration proposes to double the amount of
    spending on chemical agent R&D conducted by DHS, including $36 million
    in additional spending on non-traditional chemical agent threats,
    enhancing our ability to detect and counter these weapons. This funding
    level includes the creation of a state-of-the-art materials testing
    facility that will be housed with the Department of Defense chemical
    countermeasures programs. The National Institutes of Health will also
    devote $50 million to research chemical agent countermeasures.
      To protect against a nuclear or radiological weapon entering the
    country, a new Domestic Nuclear Detection Office (DNDO) is being created
    in the Department of Homeland Security. The DNDO will be responsible for
    developing and deploying a comprehensive system to detect and report any
    attempt to import a nuclear explosive device or radiological material.
    This Office will have oversight of all research and development for
    detection, identification, and reporting of radiological and nuclear
    materials. It will also be responsible for establishing response
    protocols to ensure that the detection of a nuclear explosive device or
    radiological material leads to timely and effective action by military,
    law enforcement, emergency response, and other appropriate government
    assets.
      The Administration is requesting $262 million in DHS R&D funds for
    advanced detection devices to minimize the likelihood that a
    radiological or nuclear device could enter the United States; this more
    than doubles the amount provided in 2005. This R&D program will be
    integrated with our overseas non-proliferation and border security
    efforts to keep these devices out of the hands of terrorists and outside
    the borders of this country. The DNDO will also work with CBP on its
    pilot program to deploy next-generation radiation detectors. Finally,
    the Office will work with State and local grant recipients to best
    deploy their radiation detection assets to work in concert with Federal
    detection efforts.

    National Strategy Mission Area: Emergency Preparedness and Response

                                 Table 3-8.  EMERGENCY PREPAREDNESS AND RESPONSE FUNDING
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Defense......................................        333.3  ............        469.0        651.4
    Department of Energy.......................................        107.6  ............         98.4        122.1
    Department of Health and Human Services....................      2,145.3  ............      2,160.2      2,264.9
    Department of Homeland Security............................      3,049.0  ............      2,655.8      2,725.8
    Other Agencies.............................................        367.3  ............        381.9        357.5
                                                                ----------------------------------------------------
      Total, Emergency Preparedness and  Response..............      6,002.6  ............      5,765.2      6,121.6

        Plus BioShield.........................................        885.0  ............      2,508.0  ...........
                                                                ----------------------------------------------------
      Total, Emergency Preparedness and  Response including          6,887.6  ............      8,273.2      6,121.6
       BioShield...............................................
    ----------------------------------------------------------------------------------------------------------------

      The Emergency Preparedness and Response mission area covers agency
    efforts to prepare for and minimize the damage from major incidents and
    disasters, particularly terrorist attacks that endanger lives and
    property or disrupt government operations. The mission area encompasses
    a broad range of agency incident management activities, as well as
    grants and other assistance to States and localities. DHS maintains the
    largest share of funding in this category ($2.7 billion, or 45 percent,
    for 2006), mainly for preparedness grant assistance to State and local
    first responders. HHS, the second largest contributor ($2.2 billion, or
    37 percent, in 2006), also assists States and localities to upgrade
    public health capacity. A total of 24 other agencies include emergency
    preparedness and response funding. A number maintain specialized
    response assets that may be called upon in select circumstances, and
    others report only funding for their agency's internal preparedness
    capability. Excluding BioShield, in the President's 2006 Budget, funding
    for emergency preparedness and response activities would increase by
    $0.4 billion (6 percent) over the 2005 level. The major requirements
    addressed in this mission area include:
        Establishing measurable goals for national preparedness and
              ensuring that Federal funding supports these goals
        Ensuring that Federal programs to train and equip States and
              localities meet national pre

    [[Page 47]]

              paredness goals in a coordinated and complementary manner.
        Encouraging standardization and interoperability of first
              responder equipment, especially for communications.
        Building a national training, exercise, and evaluation
              system.
        Implementing the National Incident Management System.
        Preparing health care providers for a mass casualty event.
        Augmenting America's pharmaceutical and vaccine stockpiles.
      Many of the key elements of the national emergency response system are
    already in place. During 2004, separate Federal response plans were
    integrated into a single all-discipline National Response Plan. To
    ensure that Federal, State, and local investments translate into
    improvements in preparedness, we must continue to identify capability
    gaps, establish national preparedness goals, and improve response and
    recovery efforts at all levels of government. A related challenge is
    ensuring that investments in State and local preparedness are focused on
    new response capabilities, and not supplanting normal operating
    expenses. DHS is leading an interagency effort to better match Federal
    resources with achieving national preparedness goals.
      From 2001 through 2005, the Federal Government has allocated $18.2
    billion in State and local terrorism preparedness grant funding from the
    Departments of Homeland Security, Health and Human Services, and
    Justice, increasing spending from an annual level of approximately $300
    million in 2001 to $4.8 billion in the 2006 request. The funding growth
    has been directed to Federal assistance for State and local preparedness
    and response activities, including equipping and training first
    responders and preparing the public health infrastructure for a range of
    terrorist threats. The Federal Government has also taken steps to
    rationalize and simplify the distribution of State and local assistance;
    better target funds based on risks, threats, vulnerability and need; and
    develop and implement national preparedness goals. In addition, DHS' new
    Office of Interoperability and Compatibility is developing a strategic
    plan to standardize public safety communications equipment and
    protocols.
      In 2005, DHS will begin to implement the National Response Plan and
    develop national preparedness goals. DHS will leverage the existing
    network of State and local responder training facilities by focusing
    more effort on ``training the trainer.'' DHS will organize 150 terrorism
    preparedness exercises during 2005, and provide grant funding to support
    approximately 400 exercises at the State and local level. The 2006
    Budget continues to provide coordinated terrorism preparedness training
    and equipment for State and local responders across the various
    responder agencies. The 2006 request includes $3.6 billion for terrorism
    preparedness grants, training, and exercises to be administered by the
    Office of State and Local Government Coordination and Preparedness
    within DHS, and proposes a significant restructuring in the grant
    allocation process to better address threats and needs. The Budget also
    supports a range of Federal response capabilities, including providing
    $110 million for the Department of Energy's Nuclear Emergency Support
    Team and other emergency response, management, and operations assets.
    The capabilities of these teams range from providing radiological
    assistance in support of State and local agencies to responding to major
    incidents worldwide.
      In 2005 and 2006 a new catastrophic incident response planning
    initiative will be undertaken. This planning effort will span across
    Federal agencies, as well as State and local governments. In addition to
    this planning initiative, the budget includes $80 million in the
    Departments of Homeland Security and Health and Human Services to
    strengthen the nation's capabilities to respond to a mass casualty
    event.
      The Budget reflects ongoing investment for Project BioShield.
    BioShield is designed to stimulate the development of the next
    generation of countermeasures by allowing the Federal Government to buy
    critically needed vaccines and medications for biodefense as soon as
    experts agree they are safe and effective enough to be added to the
    Strategic National Stockpile. This pro

    [[Page 48]]

    gram provides an incentive to manufacture these countermeasures.
    BioShield is a shared responsibility, joining the intelligence
    capabilities of DHS with the medical expertise of HHS.
      The Budget includes $600 million for the Strategic National Stockpile
    to maintain and augment the supply of vaccines and other countermeasures
    that can be made available within 12 hours in the event of a terrorist
    attack or other public health emergency. This now includes funding for
    storage and maintenance of products purchased through BioShield, and $50
    million for the purchase of supplies under the medical surge capacity
    initiative. HHS has the lead role in preparing public health providers
    for catastrophic terrorism. For 2005, HHS will provide $483 million to
    continue improvements for hospital infrastructure and mutual aid through
    the Health Resources and Services Administration, and $797 million for
    States through the Centers for Disease Control and Prevention for
    upgrades to State and local public health capacity. This investment will
    bring the total assistance provided by HHS to States, local governments
    and health care providers since 2001 to more than $7 billion.

                          Non-Federal Expenditures \4\
    ---------------------------------------------------------------------------

      \4\ OMB does not collect detailed homeland security expenditure data
    from State, local, or private entities directly.
    ---------------------------------------------------------------------------
      State and local governments and private-sector firms also have devoted
    resources of their own to the task of defending against terrorist
    threats. Some of the additional spending has been of a one-time nature,
    such as investment in new security equipment and structures; some
    additional spending has been ongoing, such as hiring more personnel, and
    increasing overtime for existing security personnel. In many cases, own-
    source spending has supplemented the resources provided by the Federal
    government.
      Many governments and businesses are placing a high priority on, and
    providing additional resources for, security. On the other hand, many
    entities have not increased their spending. A survey conducted by the
    National Association of Counties in the spring of 2004 found that as a
    result of the homeland security process of intergovernmental planning
    and funding, three out of four counties believed they were better
    prepared to respond to terrorist threats. Moreover, almost 40 percent of
    the surveyed counties had appropriated their own funds to assist with
    homeland security. Own-source resources supplemented funds provided by
    states and the Federal Government. However, the same survey revealed
    that 54 percent of counties had not used any of their own funds. \5\
    ---------------------------------------------------------------------------
      \5\ Source: National Association of Counties, ``Homeland Security
    Funding--2003 State Homeland Security Grants Programs I and II.''
    ---------------------------------------------------------------------------
      There is also a diversity of responses in the businesses community. In
    a survey conducted by the Conference Board in 2003, just over half of
    the companies reported that they had permanently increased security
    spending post-September 11, 2001. About 15 percent of the companies
    surveyed had increased their security spending by 20 percent or more.
    Large increases in spending were especially evident in critical
    industries, such as transportation, energy, financial services, media
    and telecommunications, information technology, and healthcare. However,
    about one-third of the surveyed companies reported that they had not
    increased their security spending after September 11th. \6\
    ---------------------------------------------------------------------------
      \6\ Source: Conference Board, ``Corporate Security Management'' 2003
    ---------------------------------------------------------------------------
      In light of the range of spending responses to the new security
    environment and the inherent difficulty of obtaining survey results that
    are representative of the entire universe of States, localities, and
    businesses, it is not surprising that estimates of non-Federal security
    spending also differ widely. Estimates by two private consulting firms
    for 2004 reveal that States and localities may have spent as little as
    $8 billion (according to International Horizons Unlimited) or as much as
    $15 billion (according to Deloitte Consulting). The business sector may
    have spent about $5 billion (International Horizons Unlimited) or as
    much as $46 billion (Deloitte Consulting).
      The estimates by International Horizons Unlimited were published in
    September 2003. They are on a Federal fiscal year basis. The Deloitte
    Consulting estimates were published in June 2002. They are on a fiscal
    year basis appropriate to the reporting entity. For State and local
    governments, both sets of estimates attempted to remove spending funded
    by Federal grants to avoid double counting spending that was reported by
    the Federal Government.

                                Additional Tables

      The tables in the Federal expenditures section above present data
    based on the President's policy for the 2006 Budget. The tables below
    present additional policy and baseline data, as directed by the Homeland
    Security Act of 2002.

    [[Page 49]]

    Estimates by Agency:

                       Table 3-9.  DISCRETIONARY FEE-FUNDED HOMELAND SECURITY ACTIVITIES BY AGENCY
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Energy.......................................          1.2  ............          1.2          1.5
    Department of Homeland Security............................      2,335.0  ............      2,875.0      4,688.0
    Department of Labor........................................         14.9  ............         17.6         14.2
    Department of State........................................        649.0  ............        763.3        866.0
    General Services Administration............................         72.8  ............         58.6         72.9
    Social Security Administration.............................        143.4  ............        159.4        177.5
    Federal Communications Commission..........................          1.0  ............          1.6          3.5
    Nuclear Regulatory Commission..............................         66.8  ............         59.2         61.0
    Securities and Exchange Commission.........................          5.0  ............          5.0          5.0
                                                                ----------------------------------------------------
      Total, Discretionary Homeland Security Fee-Funded              3,289.1  ............      3,941.0      5,889.5
       Activities..............................................
    ----------------------------------------------------------------------------------------------------------------

                               Table 3-10.  MANDATORY HOMELAND SECURITY FUNDING BY AGENCY
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental    Enacted      Request
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture..................................        119.0  ............        135.0        137.0
    Department of Commerce.....................................          9.5  ............          8.4          8.6
    Department of Education....................................  ...........  ............          2.7  ...........
    Department of Energy.......................................         11.0  ............         11.0         11.0
    Department of Health and Human Services....................         13.9  ............         14.2         15.9
    Department of Homeland Security............................      1,783.7  ............      2,051.2      2,125.5
    Department of Labor........................................          3.2  ............          2.6          4.0
                                                                ----------------------------------------------------
      Total, Homeland Security Mandatory Programs..............      1,940.2  ............      2,225.1      2,302.0
    ----------------------------------------------------------------------------------------------------------------

    [[Page 50]]

                       Table 3-11.  BASELINE ESTIMATES--TOTAL HOMELAND SECURITY FUNDING BY AGENCY
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                      Baseline
                        Agency                         2005   ------------------------------------------------------
                                                     Enacted*     2006       2007       2008       2009       2010
    ----------------------------------------------------------------------------------------------------------------
    Department of Agriculture.....................        601        617        632        651        668        686
    Department of Commerce........................        167        172        177        185        188        194
    Department of Defense.........................      8,566      8,865      9,137      9,423      9,722     10,032
    Department of Education.......................         25         22         23         23         23         24
    Department of Energy..........................      1,562      1,595      1,618      1,655      1,690      1,728
    Department of Health and Human Services.......      4,229      4,323      4,423      4,522      4,624      4,730
    Department of Homeland Security*..............     24,887     25,714     26,169     26,903     27,663     28,456
    Department of Housing and Urban Development...          2          2          2          2          2          3
    Department of the Interior....................         65         68         69         71         73         76
    Department of Justice.........................      2,679      2,778      2,879      2,976      3,079      3,190
    Department of Labor...........................         55         56         57         59         61         62
    Department of State...........................        824        840        859        876        894        914
    Department of Transportation..................        182        190        197        206        214        223
    Department of the Treasury....................        102        107        110        115        118        124
    Department of Veterans Affairs................        281        291        301        312        324        336
    Corps of Engineers............................         89         91         93         95         97         99
    Environmental Protection Agency...............        107        109        113        117        119        124
    Executive Office of the President.............         30         31         31         32         32         33
    General Services Administration...............         65         66         67         68         70         71
    National Aeronautics and Space Administration.        218        223        226        232        237        241
    National Science Foundation...................        342        349        357        364        371        379
    Office of Personnel Management................          3          3          3          3          3          3
    Social Security Administration................        160        163        166        170        173        177
    District of Columbia..........................         15         15         16         16         16         17
    Federal Communications Commission.............          2  .........  .........  .........  .........  .........
    Intelligence Community Management Account.....         72         73         75         77         78         80
    National Archives and Records Administration..         17         17         18         18         18         19
    Nuclear Regulatory Commission.................         59         62         64         66         68         71
    Postal Service................................        503        513        524        534        546        558
    Securities and Exchange Commission............          5          5          5          5          5          6
    Smithsonian Institution.......................         75         79         82         87         90         94
    United States Holocaust Memorial Museum.......          8          8          8          8          9          9
    Corporation for National and Community Service         17         17         17         19         19         19
                                                   -----------------------------------------------------------------
    Total, Homeland Security Budget Authority.....     46,014     47,464     48,518     49,890     51,294     52,778

      Less Department of Defense..................     -8,566     -8,865     -9,137     -9,423     -9,722    -10,032
                                                   -----------------------------------------------------------------
    Non-Defense Discretionary Homeland Security        37,448     38,599     39,381     40,467     41,572     42,746
     Budget Authority, excluding BioShield........

      Less Fee-Funded Homeland Security Programs..     -3,942     -4,052     -4,140     -4,228     -4,318     -4,412
      Less Mandatory Homeland Security Programs...     -2,225     -2,303     -2,057     -2,079     -2,099     -2,122
                                                   -----------------------------------------------------------------
    Net Non-Defense Discretionary Homeland             31,281     32,244     33,184     34,160     35,155     36,212
     Security Budget Authority excluding BioShield

      Plus BioShield..............................      2,508  .........  .........  .........      2,175  .........
                                                   -----------------------------------------------------------------
    Net Non-Defense Discretionary Homeland             33,789     32,244     33,184     34,160     37,330     36,212
     Security Budget Authority including BioShield

    Obligations Limitations
      Department of Transportation Obligations             19         19         19         20         21         22
       Limitation.................................
    ----------------------------------------------------------------------------------------------------------------
    * FY 2005 Enacted estimates include supplemental funding, but baseline estimates assume that these are one-time
      events.

    [[Page 51]]

    Estimates by Budget Function:

                                Table 3-12.  HOMELAND SECURITY FUNDING BY BUDGET FUNCTION
                                       (budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                     2004         2004          2005         2006
                               Agency                              Enacted    Supplemental   Enacted *     Request
    ----------------------------------------------------------------------------------------------------------------
    National Defense...........................................        8,960           80        12,171       12,830
    International Affairs......................................          697  ............          821          938
    General Science Space and Technology.......................          583  ............          617          608
    Energy.....................................................          109  ............          102          112
    Natural Resources and the Environment......................          342  ............          289          345
    Agriculture................................................          398  ............          582          664
    Commerce and Housing Credit................................          103  ............          649          162
    Transportation.............................................        8,350           11         8,620       10,463
    Community and Regional Development.........................        2,789  ............        2,743        3,069
    Education, Training, Employment and Social Services........          151  ............          164          168
    Health.....................................................        4,152  ............        4,276        4,473
    Medicare...................................................           11  ............            8            9
    Income Security............................................            6  ............            5            6
    Social Security............................................          143  ............          160          177
    Veterans Benefits and Services.............................          272  ............          281          300
    Administration of Justice..................................       12,937           16        13,769       14,843
    General Government.........................................          727  ............          742          775
                                                                ----------------------------------------------------
    Total, Homeland Security Budget Authority..................       40,730          107        45,999       49,942

      Less National Defense, DoD...............................       -7,025  ............       -8,566       -9,513

                                                                ----------------------------------------------------
    Total, Homeland Security Budget Authority excluding               33,705          107        37,433       40,429
     BioShield.................................................

      Less Fee-Funded Homeland Security Programs...............       -3,289  ............       -3,942       -5,888
      Less Mandatory Homeland Security Programs................       -1,941  ............       -2,225       -2,303

                                                                ----------------------------------------------------
    Net Discretionary, Homeland Security Budget Authority             28,475          107        31,266       32,238
     excluding BioShield.......................................

      Plus BioShield...........................................          885  ............        2,508  ...........

                                                                ----------------------------------------------------
    Net Discretionary, Homeland Security Budget Authority             29,360          107        33,774       32,238
     including BioShield.......................................
    ----------------------------------------------------------------------------------------------------------------
    * Excludes $16 million in supplemental appropriations provided to the Coast Guard in 2005.

    [[Page 52]]

                      Table 3-13.  BASELINE ESTIMATES--HOMELAND SECURITY FUNDING BY BUDGET FUNCTION
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                      Baseline
                   Budget Authority                    2005   ------------------------------------------------------
                                                     Enacted*     2006       2007       2008       2009       2010
    ----------------------------------------------------------------------------------------------------------------
    National Defense..............................     12,171     12,555     12,914     13,291     13,681     14,087
    International Affairs.........................        821        837        856        873        891        911
    General Science Space and Technology..........        617        630        643        656        670        683
    Energy........................................        102        106         97        100        102        107
    Natural Resources and the Environment.........        289        296        305        313        319        331
    Agriculture...................................        582        598        612        630        646        664
    Commerce and Housing Credit...................        649        662        676        694        709        726
    Transportation................................      8,636      8,907      9,204      9,480      9,766     10,063
    Community and Regional Development............      2,743      2,800      2,858      2,918      2,981      3,044
    Education, Training, Employment and Social            163        164        169        178        183        189
     Services.....................................
    Health........................................      4,276      4,371      4,471      4,572      4,676      4,782
    Medicare......................................          8          8          9          9          9         10
    Income Security...............................          5          6          6          6          6          7
    Social Security...............................        160        163        166        170        173        177
    Veterans Benefits and Services................        281        291        301        312        324        336
    Administration of Justice.....................     13,769     14,307     14,454     14,897     15,353     15,840
    General Government............................        742        763        777        791        805        821
                                                   -----------------------------------------------------------------
    Total, Homeland Security Budget Authority.....     46,014     47,464     48,518     49,890     51,294     52,778

      Less National Defense, DoD..................     -8,566     -8,865     -9,137     -9,423     -9,722    -10,032
                                                   -----------------------------------------------------------------
    Net Discretionary, Homeland Security Budget        37,448     38,599     39,381     40,467     41,572     42,746
     Authority, excluding BioShield...............

      Less Fee-Funded Homeland Security Programs..     -3,942     -4,052     -4,140     -4,228     -4,318     -4,412
      Less Mandatory Homeland Security Programs...     -2,225     -2,303     -2,057     -2,079     -2,099     -2,122
                                                   -----------------------------------------------------------------
    Net Discretionary, Homeland Security Budget        31,281     32,244     33,184     34,160     35,155     36,212
     Authority....................................

      Plus BioShield..............................      2,508  .........  .........  .........      2,175  .........
                                                   -----------------------------------------------------------------
    Net Discretionary, Homeland Security Budget        33,789     32,244     33,184     34,160     37,330     36,212
     Authority, including BioShield...............
    ----------------------------------------------------------------------------------------------------------------
    * FY 2005 Enacted estimates include supplemental funding, but baseline estimates assume that these are one-time
      events.

    Detailed Estimates by Budget Account:

      An appendix of account-level funding estimates, organized by National
    Strategy mission area, is available on the Analytical Perspectives CD
    ROM.