[Senate Hearing 106-1021]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 106-1021



    IMPROVING THE NATIONAL INSTANT CRIMINAL BACKGROUND CHECK SYSTEM

=======================================================================

                                HEARING

                               before the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 21, 2000

                               __________

                          Serial No. J-106-90

                               __________

         Printed for the use of the Committee on the Judiciary


                   U.S. GOVERNMENT PRINTING OFFICE
73-364                     WASHINGTON : 2000

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                       COMMITTEE ON THE JUDICIARY

                     ORRIN G. HATCH, Utah, Chairman
STROM THURMOND, South Carolina       PATRICK J. LEAHY, Vermont
CHARLES E. GRASSLEY, Iowa            EDWARD M. KENNEDY, Massachusetts
ARLEN SPECTER, Pennsylvania          JOSEPH R. BIDEN, Jr., Delaware
JON KYL, Arizona                     HERBERT KOHL, Wisconsin
MIKE DeWINE, Ohio                    DIANNE FEINSTEIN, California
JOHN ASHCROFT, Missouri              RUSSELL D. FEINGOLD, Wisconsin
SPENCER ABRAHAM, Michigan            ROBERT G. TORRICELLI, New Jersey
JEFF SESSIONS, Alabama               CHARLES E. SCHUMER, New York
BOB SMITH, New Hampshire
             Manus Cooney, Chief Counsel and Staff Director
                 Bruce A. Cohen, Minority Chief Counsel


                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Hatch, Hon. Orrin G., a U.S. Senator from the State of Utah......     1
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont, 
  prepared statement.............................................    77
Schumer, Hon. Charles E., a U.S. Senator from the State of New 
  York...........................................................     5
Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama, 
  prepared statement.............................................    79

                               WITNESSES

Ball, Robin, Owner, Sharp Shooting Indoor Range and Gun Shop, 
  Spokane, WA....................................................    58
Dole, Hon. Bob, Former U.S. Senate Majority Leader from the State 
  of Kansas, Special Counsel, Verner, Liipfert, Bernhard, 
  McPherson Hand.................................................     6
Durbin, Hon. Richard J., a U.S. Senator from the State of 
  Illinois.......................................................    33
Loesch, David R., Assistant Director in Charge, Criminal Justice 
  Information Services Division, Federal Bureau of Investigation, 
  U.S. Department of Justice, Clarksburg, WV.....................    37
McCollum, Hon. Bill, U.S. Representative in Congress from the 
  State of Florida, prepared statement...........................    33
Schlueter, Max, Director, Vermont Criminal Information Center, 
  Vermont Department of Public Safety, Waterbury, VT.............    65
Smith, Stuart, Bureau Chief, Utah Department of Public Safety, 
  Bureau of Criminal Indentification, Salt Lake City, UT.........    54
Thomas, Hon. Craig, a U.S. Senator from the State of Wyoming, 
  prepared statement.............................................     3

                       SUBMISSIONS FOR THE RECORD

Barr, Hon. Bob, a U.S. Representative in Congress from the State 
  of Georgia.....................................................    81
Santorum, Hon. Rick, a U.S. Senator from the State of 
  Pennsylvania, prepared statement...............................    79

 
    IMPROVING THE NATIONAL INSTANT CRIMINAL BACKGROUND CHECK SYSTEM

                              ----------                              


                        WEDNESDAY, JUNE 21, 2000

                                       U.S. Senate,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:12 a.m., in 
room SD-226, Dirksen Senate Office Building, Hon. Orrin G. 
Hatch (chairman of the committee) presiding.
    Also present: Senators Leahy and Schumer.

 OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM 
                       THE STATE OF UTAH

    The Chairman. Today, the Judiciary Committee will examine 
the operation of the National Instant Criminal Background Check 
System, known as NICS, which has been in use for approximately 
1\1/2\ years.
    The question over how best to prevent criminals from 
purchasing firearms has stirred a great deal of debate during 
the past 15 years. The consensus seems to have developed in 
support of a fully operational NICS system, which I and other 
Republicans crafted, especially Senator Dole here, and fought 
hard to enact. The first Senate vote on the NICS proposal was 
an amendment Senator Stevens and I wrote. Ironically, it was 
opposed by gun control advocates.
    Senator Dole, one of our witnesses today, eventually took 
the NICS concept that we had developed and integrated it with 
the Brady waiting period. The Brady waiting period, which I 
opposed, was enacted in 1993 and subsequently was sunsetted. 
Proposals to reinstate the waiting period have not been 
actively advanced by gun control advocates up until now.
    Our focus today is the implementation of NICS, a system 
based on an idea that the overwhelming majority of law-abiding 
Americans believe in, an instant point-of-sale background check 
that prevents criminals and other prohibited persons from 
obtaining firearms. The NICS system has not yet lived up to its 
promise. Instead of an instant check, we have a system that too 
often causes needless delay to law-abiding citizens who are 
simply exercising their constitutional rights.
    System outages are a major culprit. Numerous outages, such 
as the 4-day outage that coincided with the Million Mom March 
for gun control, have shut down the NICS for hours or even days 
at a time. When the system is down, neither Federal nor State 
background checks can proceed and gun sales cannot occur. 
According to FBI data, system outages amounted to over 215.5 
hours of down time last year alone.
    In light of today's computer technology, law-abiding 
citizens should not and do not accept such outages as 
unavoidable. We all know that the computer systems that handle 
credit card approvals, essentially instant credit checks, 
process millions of transactions each day and rarely, if ever, 
suffer significant outages. Clearly, computer hardware and 
software exists that could enable reliable and consistent 
processing of NICS background checks.
    For this reason, many law-abiding gun owners and dealers 
see NICS computer troubles as evidence that the Clinton 
administration is simply not committed to making NICS work. The 
White House has spent a great deal of time advocating for more 
gun control laws, but little attention has been paid to 
improving the computer system that could do much more to keep 
guns out of the wrong hands. One goal of this hearing is to 
learn why the NICS computers have such an abnormally high 
incidence of outages and what the administration should be 
doing to run them better.
    Even when the NICS computer system is running, moreover, 
NICS is still not an instant check for many people. According 
to FBI data, the system provides an answer within 30 seconds 
only 72 percent of the time. Factoring in a denial rate of 2 
percent, this means that over 26 percent of transactions are 
delayed not due to problems in the purchaser's background, but 
rather because the process is not efficient. In short, the NICS 
checks as currently administered are needlessly delaying one-
quarter of the firearms purchases in America. This is not 
acceptable. Perhaps the outages and delays would be less 
troublesome to the public if the administration's commitment to 
the system were stronger.
    According to the FBI, the main reason why background checks 
are delayed is that the NICS databases contain incomplete State 
criminal records. For example, the databases might indicate an 
arrest but not reveal whether that arrest resulted in a 
conviction. Since a felony conviction but not an arrest is a 
bar to gun ownership, it is critical to find the ultimate 
disposition of each arrest. An attempted firearm purchase in 
such a case is delayed while the FBI researches the outcome of 
the arrest.
    I would like to find a way to encourage the States to 
provide the best records possible to the criminal databases, 
but I would also like to do this on a cost-effective basis. 
Congress has provided approximately $292.5 million in funding 
to the National Criminal History Improvement Program, known as 
NCHIP, to help States automate and upgrade the quality and 
completeness of their criminal records. In addition, 5 percent 
of the funds Congress provides for law enforcement under the 
Byrne Formula Grants are used for improving criminal justice 
records.
    Our assistance has been helpful, but according to the 
Bureau of Justice Statistics, only 26 States recently reported 
having 60 percent or more of their final dispositions recorded. 
Only 11 percent reported 80 percent. This is inadequate. In 
short, we still have a lot of work to do. We need to find a new 
and more efficient way of encouraging the States to update 
their criminal records.
    We should also look at possible ways to help States make a 
commitment to becoming full point-of-contact States for NICS. 
Full point-of-contact States are those that agree to conduct 
all background checks or searchers for firearms purchases 
rather than relying on the FBI to do so. Two studies recently 
completed by the General Accounting Office indicate that States 
acting as NICS points of contact do a better job of conducting 
background checks than the FBI. States have advantages, 
including better access to court records and a better 
understanding of the respective State firearms laws. Senator 
Leahy and I are sponsoring a proposal to reimburse those States 
that act as points of contact.
    Now, I want to assure the witnesses that I have an open 
mind and I want to hear their ideas on how to improve NICS. 
Rather than consume our energies over firearm-related proposals 
that divide our noble institution, I believe we should focus 
our efforts on those issues where there is agreement. Improving 
NICS, making it live up to its promise, is just such an issue.
    For that reason, I am looking forward to hearing from our 
two panels of distinguished and knowledgeable witnesses and I 
would like to extend a particular welcome to the former 
Majority Leader of the U.S. Senate, Senator Robert Dole, and to 
Captain Stuart Smith, a Director of the Utah Bureau of Criminal 
Identification. Of course, we also have the Honorable Richard 
Durbin here. We extend an invitation to a former member of the 
committee who is going to testify, as well.
    We are pleased to have on our first panel of witnesses 
Senator Robert Dole, former Majority Leader and Senator from 
Kansas, who worked closely with me and others in drafting the 
NICS law.
    Senator Craig Thomas of Wyoming, who was scheduled to 
testify this morning, is detained in another meeting at this 
time, so we will make his testimony available for the record.
    [The prepared statement of Senator Thomas follows:]

Prepared Statement of Hon. Craig Thomas, a U.S. Senator From the State 
                               of Wyoming

    I appreciate the Judiciary Committee's invitation to speak today. I 
am pleased that the Committee is interested in finding ways to enhance 
the effectiveness of the National Instant Criminal Background Check 
System (NICS). This hearing is a step in the right direction.
    As most of us are well aware, the NICS system was created following 
passage of the Brady Handgun Violence Prevention Act of 1993. Pursuant 
to this Act, the Attorney General was charged with establishing a 
National Instant Criminal Background Check System that any Federal 
Firearms Licensee (FFL) could contact for immediate information on 
whether the receipt of a firearm would violate state or federal law.
    The Clinton Administration has spent 7 years and hundreds of 
millions of dollars to create a system to screen firearms purchases. In 
FY 2000, the NICS system's operating budget was roughly $70 million. 
Unfortunately, after the Government spent millions of dollars and 
worked for years to establish this system, there are still many flaws 
with this process.
    While the NICS system is designed to screen perspective firearms 
buyers, I have many questions about its effectiveness. Recently, the 
General Accounting Office (GAO) completed a comprehensive audit that I 
requested regarding the NICS system. The GAO audit detailed the 
effectiveness of the NICS system for its first year--from November 30, 
1998 through November 30, 1999. The agency found that while the program 
does an adequate job in achieving some of its goals there are various 
areas that must be fixed, including:

   Unscheduled outages of the NICS System

    --For example, each and every time the National Instant Criminal 
            Background Check System goes off-line Federal Licensed 
            Firearms Dealers around the country are unable to do 
            business.
   The GAO reported that, ``From December 1998 through 
        September 1999, the FBI identified more than 360 unscheduled 
        outages associated with NICS.''
   The system failed to meet its operating accountability 
        standards two-thirds of the time.
   The lack of any credible back-up system.
   The GAO also found that from December 1998 through November 
        1999 1.2 million, or 28 percent, of all federal firearm checks 
        were not instant.

    Mr. Chairman, the GAO report paints a sobering picture of a failure 
by federal agencies to enforce existing gun laws as Congress intended. 
The result is that the Second Amendment rights of law abiding citizens 
are being infringed upon while too often criminals seep through without 
consequence.
    While the Clinton Administration continues to publish reports 
highlighting the effectiveness of the NICS program, these reports fail 
to touch upon the lack of enforcement and prosecution of existing gun 
laws.
    Take for example a recent Bureau of Justice Statistics Bulletin 
titled ``Background Checks for Firearms Transfers, 1999.'' This 
publication does a wonderful job of breaking down the number of 
individuals who have been blocked from purchasing firearms from 
licensed dealers--for instance in 1999:

   Under a federal backgound check 81,000 individuals were 
        denied the ability to purchase firearms (71 percent due to a 
        felony indictment or conviction) yet in another Bureau of 
        Justice Statistics Special Report titled, ``Federal Firearms 
        Offenders 1992-1998'' it states that in 1999 there were only 
        7,146 defendants charged in U.S. District courts with a firearm 
        offense.

    The real question for the Administration is why are they so pleased 
that 81,000 individuals were denied the ability to purchase a firearm 
when more importantly there were only 7,146 defendants charged with a 
firearms offense? I believe the American public will find it 
interesting that the FBI and ATF have the name and address of these 
felons who were denied the ability to purchase a firearm, yet there is 
only a dismal 11.3% chance of getting them prosecuted.
    Furthermore, federal prosecutions of firearms offenders have fallen 
13 percent compared to 1992. In its last full year, the Bush-Quayle 
Administration prosecuted 7,621 defendants charged with a firearms 
offense. In 1997, prosecutions under the Clinton-Gore Administration 
fell to 5,993. The Clinton-Gore Administration has prosecuted an 
average of 6,659 accused firearms offenders per year--a 13 percent drop 
from 1992.
    As we continue our oversight of current gun control laws, if it's 
found that criminals still get guns and a high number of legal gun 
purchases are denied, you have to question the effectiveness of 
additional layers of gun regulations. It is important to recognize that 
if this program is to be effective there must be meticulous reporting, 
investigation and prosecution of individuals that are screened by the 
FBI.
    It is my hope that the Judiciary Committee will be able to work 
with the FBI to reduce the frequency of NICS outages and make the 
system more effective. Thanks again for allowing me the opportunity to 
appear before you today.

    We also welcome Senator Richard Durbin of Illinois, who 
requested the other recent GAO report, which concerns options 
for improving the NICS system.
    We are grateful to have you both here today and we will 
start with you, Senator Dole.
    Senator Dole. I am not in the Senate any longer. You may 
have something to do. I do not have anything to do for the rest 
of my life, but----
    [Laughter.]
    Senator Durbin. What I have to do is to listen to Senator 
Dole.
    Senator Dole. Do you want to go first?
    The Chairman. I will solve that problem. We have not 
listened to the minority yet because I was waiting for Senator 
Leahy, but Senator Schumer represents the minority, so we will 
take his statement now, and then shall we turn to Senator Dole? 
You do not mind, Senator?
    Senator Durbin. No, I am honored.
    The Chairman. I think we still consider him our Senator. Go 
ahead.

 STATEMENT OF HON. CHARLES E. SCHUMER, A U.S. SENATOR FROM THE 
                       STATE OF NEW YORK

    Senator Schumer. Thank you, Senator, and I appreciate your 
holding these hearings and I appreciate both our witnesses. One 
of them is my roommate in Washington. Can you guess which one?
    The Chairman. I did not realize that, Senator Dole. I am 
just amazed. [Laughter.]
    Senator Schumer. Anyway, Mr. Chairman, I was, as you know, 
very actively involved in writing the Brady bill and I was in 
the room during the tortuous negotiations which gave birth to 
the national InstaCheck system. In order to secure enough votes 
for passage, we agreed to sunset the 5-day Brady waiting period 
after 5 years and replace it with InstaCheck, a system that 
would rapidly, and in some cases instantaneously, approve gun 
purchases.
    I was dubious of InstaCheck at the time. I thought it was 
unworkable. But it was a necessary compromise to pass the most 
important gun control legislation since 1968, and with a 
Democratic Congress and a Democratic President, I felt fairly 
certain we would be able to forestall InstaCheck indefinitely.
    Well, so much for my predictions. We are now a year and a 
half into relying on InstaCheck full time. Is it a perfect 
system? No. Is there room for improvement? Most certainly. But 
the NICS system is far better and far more reliable than any of 
us had the right to expect at the time it was created, and I 
hope that in this hearing, as we look for ways to improve it, 
that we also credit the Justice Department for doing an 
incredible job in making NICS a remarkably effective system 
that has kept guns out of the hands of criminals without 
inconveniencing law-abiding gun buyers.
    Like Senator Thomas, Senator Durbin and I requested a 
report from GAO on InstaCheck. Here are the facts. Seventy-two 
percent of all background checks are completed, start to 
finish, within 3 minutes. That is an astounding figure. Let me 
repeat it. Seventy-two percent of all background checks are 
completed, start to finish, within 3 minutes. Ninety-five 
percent are completed within 2 hours, and the remaining 5 
percent take a matter of days, mostly because State and local 
governments have failed to report the disposition of felony 
arrests.
    The system is up and running 17 hours a day, 7 days a week, 
and has been down only 3.4 percent of the time. There has been 
only one major prolonged outage in 18 months of operations. Of 
the 4.4 million people who pass through the NICS system, only 
10,000 were mistakenly rejected for a handgun. That is six 
errors for every 10,000 buyers through the system.
    Whether you support gun control or oppose it, whether you 
were dubious of InstaCheck or optimistic, these numbers do not 
lie. InstaCheck has been an overwhelming success.
    But there is one problem with InstaCheck and it has nothing 
to do with the Justice Department. At gun shows, through the 
Internet, among straw buyers, an enterprising criminal can 
avoid a background check and the blame lies here in Congress. 
We should have a hearing on why nearly 90 percent of the guns 
traced to crime over the last 3 years were used by someone 
other than the original buyer of the gun. We should have a 
hearing on why one-fourth of the guns used in out-of-State 
crimes come from only four States. Is that not incredible? One-
quarter of the guns used in out-of-State crimes come from four 
States, Florida, Georgia, Mississippi, and Texas.
    InstaCheck has been a success. It has not been perfect, but 
frankly, neither have we. There are a series of questions that 
I will be asking DOJ panelists. For example, there is a 
disparity between the rejection rates of the point-of-contact 
States and the NICS States and I am interested in their views 
on why this is the case. I know that Senators Hatch and Leahy 
have legislation, which I am proud to cosponsor, that would 
provide grants to point-of-contact States to cover the costs of 
InstaCheck. I would like to hear their views on the proposed 
law. I am also concerned that those adjudicated mentally ill 
are able to pass a background check and I am interested in ways 
to make this part of the Brady law more effective.
    Having said that, I know we have two very distinguished 
witnesses, one I have admired mostly from afar and one I have 
admired mostly from closer up--I will say nothing more--and I 
look forward to hearing their testimony, Mr. Chairman.
    The Chairman. Thank you, Senator Schumer.
    Senator Dole.

STATEMENT OF HON. BOB DOLE, FORMER U.S. SENATE MAJORITY LEADER 
 FROM THE STATE OF KANSAS, SPECIAL COUNSEL, VERNER, LIIPFERT, 
            BERNHARD, McPHERSON HAND, WASHINGTON, DC

    Senator Dole. Thank you very much, Mr. Chairman and Senator 
Schumer and Senator Durbin. I was a member of this committee 
many years ago and enjoyed that opportunity to be a member of 
the Judiciary Committee. I think I had three or four committees 
at the time and I had to yield one committee and I gave up the 
Judiciary Committee. But I have had a longtime interest. I 
mean, I know what a gun can do to someone, maybe not a handgun 
or a long gun, and I know World War II is a little different, 
but it is still a gun and it still has an impact and it can 
change your life forever.
    So I had sort of a longtime interest in trying to figure 
out, how do we keep guns out of the hands of people who should 
not have the gun in the first place? So it is a longtime 
interest, and I think way back in 1979, I offered an amendment 
that authorized the Federal Bureau of Investigation to initiate 
a pilot program called the Interstate Identification Index, the 
III Program, and that was sort of the first effort. I think 
that laid the foundation, because there had not been many 
changes since the 1968 gun laws, foundation for Congressman 
McCollum and I to offer the Instant Check proposal, along with 
Senator Hatch and many others. We wanted to enable gun dealers, 
either directly through the FBI or through designated State 
agencies, to be able to check the eligibility of a prospective 
gun buyer in real time.
    As you know, the 1968 Act prescribed several categories of 
individuals from purchasing or possessing firearms. Instant 
Check was to be the vehicle to ensure that persons with felony 
criminal backgrounds and others, such as illegal aliens--I 
think there are now nine categories--wanted fugitives, addicts, 
and mental defectives could not obtain firearms from Federal 
dealers. We also tried to reduce the fraudulent misuse of 
identity documents presented to the dealer in support of the 
sworn application.
    The III Program was to be permanently authorized and the 
Instant Check was to be an integral part and would apply to all 
firearms, long guns, handguns. It was a substitute for the 7-
day waiting period proposal of Sarah and Jim Brady and others 
that would have applied to handgun purchases only, and I will 
confess that I once sponsored a 21-day waiting period and I 
read my mail and decided that probably was not a very good 
idea. But in any event, that was a long time ago.
    But eventually, Dole-McCollum prevailed and became law and 
Virginia became the first State to implement this new law in 
1998. I can still remember how this all happened, because I 
remember Senator Mitchell and I spent a long time. Everybody 
had gone home for Thanksgiving but us. I think Senator Kohl was 
around, too, and Senator Hatch was around. They just left us 
with a conference report which had all these very controversial 
provisions, in addition to the gun legislation, many other 
controversial provisions, and we were left to grapple with that 
and nobody wanted to come back, but everybody wanted to vote. I 
think I had an Excedrin headache for a couple of days. But 
finally, we agreed to just pass the conference report and many 
of us had doubts, as Senator Schumer has pointed out, whether 
it is going to work, what was going to happen.
    But anyway, it became in 1993 the permanent provision of 
the Brady Act and the 5-day waiting period, of course, applied 
to handguns only and this was going to be implemented 5 years 
later. That was part of the compromise, as has been pointed 
out. Then the temporary Brady 5-day waiting period would 
expire. I recall this, as I said, quite well, because we had 
lots of meetings and lots of interested Senators and many, many 
groups who had different opinions. As I said, Senator Mitchell 
and I found ourselves on the floor and we were able to hammer 
out some features of the legislation.
    But now, I think very properly, and I want to commend the 
chairman, you are revisiting the matter, but there is a big 
difference. The Brady waiting period is no more. That is gone. 
That has expired, at least at the Federal level. The Instant 
Check is permanently ensconced. I think, by all accounts, it is 
probably the greatest thing since sliced bread. I mean, it is 
certainly not perfect and there are reasons it is not perfect, 
and I will just make some recommendations that I know all the 
members are probably more aware of than I.
    We have had numerous stories, success stories documented 
where convicted felons and other disqualified individuals have 
been barred from purchasing firearms, and I have attached a 
list of several of these incidents to the end of my statement. 
They were prepared by the FBI in a NICS operation report of 
March 2000. Also attached is a pie chart from the same report 
that indicates the various reasons for denial of requests. Most 
of them are felony convictions.
    I must admit, the numbers are impressive. According to the 
FBI operations report, since November 1998, when NICS was 
activated, the Bureau has performed more than five million 
checks--five million checks--and State police points of contact 
in 26 States have performed an equal number. That is ten 
million checks since 1998.
    Brady handgun checks prevented more than 300,000 bad guys 
from buying handguns in its 5 years of operation. In 13 months 
under the present check, almost 180,000 denials were effected, 
and the operations report at page eight reveals that 72 
percent, as has already been pointed out, of the inquires are 
processed in 30 seconds. Seventy-two percent in 30 seconds, 
that is about as fast as you go into the grocery store and use 
your credit card. All but 5 percent are processed 
electronically within 2 hours. Only 2 percent must be completed 
by manual checks.
    Some States, such as Virginia, have even better response 
times, and virtually all of Virginia's checks in its own 
databases are processed within 2 minutes. Virginia also checks 
gun show sales, as well, and I will attach the summary of that 
just for the record.
    So based on the first year's experience, some changes and 
enhancements need to be made to improve the system's 
effectiveness and utilize its capabilities in related fields. 
However, instead of a technical discussion, improvement of 
Instant Check has become sort of a political fight of the first 
order and there has to be some way to resolve all of this. I am 
no longer in the Senate, so I cannot add or detract anything, 
but it seems to me that there should be ways to work it out 
before Congress goes home this year.
    But let me summarize the proposals contained in my main 
statement, which I will submit for the record in a day or two. 
These are made after review of the FBI, the BJS, and Virginia 
reports on implementation, and in light of the legislative 
history as I understand it. The proposals are divided into two 
categories.
    First, I recommend that the focus of the existing law be 
redirected, both authorizing and appropriations legislation, 
and second, I recommend several amendments be made to the 
enabling law.
    The first category, it seems to me, are ``no brainers.'' I 
mean, it seems to me that the NICS system ought to operate 24 
hours a day instead of 17, and this will be necessary to 
improve the operational effectiveness of the system. It is 
going to be absolutely essential if gun show sales are to be 
included. I am told it can be done for $7 million, so it seems 
to me that it ought to be done.
    NICS needs to be backed up by a redundant system in case of 
a breakdown. I guess this is the one that would cost $7 
million. They have only had, I think, a few breakdowns, but 
there should be a backup system. We have had a couple of 
occurrences lately. This can be done, according to the FBI, the 
upgrade will cost only $7 million.
    I think the primary thing, most of the funding appropriated 
so far by Congress, over $310 million, has not been spent on 
direct assistance to the States to implement the Dole-McCollum 
check. The aid money has been diverted to other purposes, and 
although the Bureau of Justice Statistics has published summary 
data on its NCHIP program, it is not possible to tell exactly 
how the money was spent. It appears that most has gone to buy 
automated fingerprint equipment and other hardware not related 
to NICS. Money for record conversion has largely been spent to 
automate police arrest records, and as the chairman pointed out 
in his opening statement, the arrest records may be important, 
but the conviction records are the ones you have to have. 
Virtually no money has been given to courts to automate 
conviction records.
    As a result, the BJS survey last year of criminal history 
records found that there was a total of 62 million records in 
various repositories. Of these records, only 23 million 
disposition/conviction records are available for the checks, 
and this is the overwhelming reason why the FBI must initially 
reserve judgment on 28 percent of the inquiries. If we want to 
make it a better system, then we have got to put the money 
where it belongs, and that is getting these records and 
databases up to speed.
    The Justice Department has received $45 million this year 
for NCHIP and it may not be too late to refocus those funds to 
direct support of NICS. Seventy-million dollars has been 
requested for fiscal year 2001, and this ought to be subject to 
appropriations earmarks and riders that direct funds be spent 
for automation of conviction and other records directly 
relevant to NICS inquiries.
    We also ought to have funds available to assist States to 
perform their own checks as well as the FBI checks. We have 
virtually no money spent for that purpose, and it seems to me 
that--well, at present, only half the States have their own 
system and only 14 check both handguns and long guns. Most 
distressing is the fact that at least one State, South 
Carolina, has withdrawn and others are on the verge of 
withdrawing, I think Colorado and Florida. Florida is 
considering it, but the State legislature has authorized 
participation. Colorado was about to withdraw last year but 
reconsidered in the wake of the tragedy in which a multiple 
murder was committed after the FBI cleared a prospective buyer. 
It later was discovered that the individual was under a 
restraining order, but Colorado had not forwarded this 
information to the FBI. So again, if we had had the records, 
that guy would not have had the gun.
    Small dealers and collectors should be federally licensed 
again. In 1994, BATF tightened the requirements for these 
licenses. As a result, the number dropped from about 230,000 to 
80,000, and the emphasis was to limit the license to stocking 
dealers. The small mom and pop dealers were wiped out. The 
effect has been to take millions of gun show and other sales 
off the books, and without buyer's certification of 
eligibility, which is Form 4473, being executed and recorded in 
dealer records. Ex-dealers still offer their wares at gun 
shows, but as individuals. But these dealers were gladly in the 
system at one point and should be readmitted.
    Now, these all can be done, these three or four things, 
without any additional legislation. I will just mention a 
couple that I think probably require legislation.
    It seems to me that you ought to be able to do this check 
in about 8 hours or less from the time of the initial inquiry. 
This is well within the parameters of the current FBI response 
times, with the exception of 2 percent that cannot be resolved 
online within 2 hours. I think in these latter cases, 2 
percent, the Bureau should be authorized to use commercial 
compilers of criminal history records to obtain a complete 
record on prospective buyers. These organizations spend 
hundreds of millions of dollars annually capturing this and 
much other public record information for background checks of 
all kinds, both public and private. In the interim, until 
complete, automated criminal justice records are available, 
private checks would reconcile most instances where the police 
records are lacking.
    I think also that check inquiries should be considered as 
originating from law enforcement, whether from a police agency 
or a dealer. This will ensure that there will be direct funding 
from Congress to support the cost of operating NICS.
    At the same time, I think NICS should be expanded to handle 
non-law enforcement background checks when authorized by 
Federal or State law. Fees collected from these checks can go 
to offset the cost of the system, provide incentives for States 
to create or expand their own systems. This funding should be 
strictly limited and earmarked to improvements in the NICS 
system and not subject to the type of diversion that we suspect 
occurred with the NICS funding to date. Funding should not go 
for secondary purposes, such as AFIS equipment, until primary 
needs have been satisfied.
    Firearms checks should be made at major gun shows by either 
a State agency, the FBI, or the BATF. Virginia's experience 
should be the national model. There, for the last year and a 
half, the State police have set up booths at the 16 major 
shows. Usually two officers man the booths, equipped with 
laptop computers. For dealers and others who do not have 800-
line telephone access to the State police center, the police 
will make the checks directly. The State police center is open 
on weekends. The system is working well. At the smaller shows, 
there is no booth but the 800 number is used to contact the 
center. The sales volume at these latter shows is so small that 
there is little inconvenience for sellers or buyers.
    Nationally, there is estimated about three million gun show 
sales annually, three million. The FBI would need additional 
resources to handle its share of this workload. The BATF has 
the manpower that could be utilized, and all but a small 
percentage of the sales at the shows would be completed in a 
timely fashion. It seems to me if there are 1 or 2 percent that 
do not, then they ought to take whatever time they need.
    As new technology becomes available, it should be employed 
to make point-of-sale gun sales and make the checks more 
accurate. Advances in the state of the art of this technology 
should be closely monitored with a view in mind of applying 
them to the retail commerce in firearms.
    The FBI should have authority to record permanently 
approvals and denials of gun sales in III. A recent BJS study 
revealed that only a very small percentage of denials are 
prosecuted unless they are included in more serious offenses. 
There have been strong disagreements as to what is the 
appropriate time for retention of audit trails. It seems to me 
it makes sense to keep a record of a gun check until it is 
completed and until the appeal period has lapsed after a 
denial.
    But it makes no sense, and I certainly never intended that 
records of lawful transactions cleared by the NICS system be 
retained by the Federal Government. Denials should be retained 
in III for law enforcement purposes, and hopefully prosecution, 
but not the NICS records of lawful purchases. The dealer's 
records, including the buyer's Form 4473, can be inspected if a 
valid law enforcement need arises.
    And finally, I think the definitions of prohibited persons 
in Section 922 of the GCA, the 1968 Act, should be revisited in 
light of the operational experience in performing the checks. 
Some categories are not appropriate, such as persons who have 
voluntarily renounced U.S. citizenship. They are not in the 
country. Even the definition of convicted felon needs revision, 
according to a NICS advisory group.
    I also would suggest maybe a broad-based advisory group be 
formed to provide guidance to the FBI and the States on 
operation of NICS. At present, only representatives of law 
enforcement can perform this vital function, and it is my 
understanding that the FBI rejected a request last year to 
constitute a NICS advisory committee from industry and consumer 
groups. I think that is unfortunate. We ought to have others 
involved other than just law enforcement, and I think this 
would certainly go a long way in addressing some of the 
questions. I think the FBI has scheduled a meeting for more 
groups in February.
    Mr. Chairman, that is a short summary, and I know it has 
taken more than the 5 minutes, but I understand former members 
are allowed 10 minutes or 20 minutes or whatever, and I 
appreciate your not cutting me off. I do hope that these 
statements can be helpful.
    [The prepared statement of Senator Dole follows:]

                 Prepared Statement of Senator Bob Dole

                       INSTANT CHECK ENHANCEMENTS

    A broad consensus exists that the Instant Check program for online 
background checks of prospective gun buyers has worked well since the 
FBI began operations in November of 1998. However, some problems do 
exist that call out for answers. Strong disagreements arise with 
respect to how best to improve its performance and extend its scope to 
include gun show sales.
    Between November 30, 1998 and December 31, 1999, the National 
Instant Criminal Background Check System (NICS), has processed almost 
5,000,000 instant check requests, according to its Operations Report on 
its first year of activity. The states have processed almost an equal 
number (see Attachment 1 submitted with oral statement).
    The large majority (72 percent) of the FBI inquiries are processed 
and approved in seconds. On-line requests from law enforcement are 
approved in under six seconds. 800 calls from dealers average 30 
seconds. In twenty-eight percent of the cases, a deferral of decision 
results. The overwhelming reasons for the delay are either: (a) 
mistaken identity or (b) arrest record, but no disposition entry. All 
but five percent of the deferrals are cleared within two minutes. 
Another three percent are cleared within two hours. The balance (2 
percent) can take several days since a manual check must be made, 
usually to a county court house.
    Half of the states have their own systems. Fifteen check both 
handguns and long guns. Ten states process only handguns. Their 
response time varies significantly, but the most advanced states such 
as Virginia and Georgia have response times that compare favorably with 
the FBI. Alabama's criminal history records are on the Internet. The 
other states rely on the FBI, or have state licensing or registration 
systems. Michigan checks handguns only, but also has a registration 
system for them. California registers all firearms and has a waiting 
period with a background check. A state check involves an online check 
with the FBI as well as its own records. An FBI check initiated by a 
dealer involves only the records voluntarily contributed from the 
dealer's state to the FBI and the FBI's own records.
    Virginia was the first state to develop an instant check system in 
1989, pursuant to the original Dole-McCollum authorizing legislation. 
Since that time more than 1.8 million Virginia state checks have been 
made. For several years, Virginia's turn-down rate was only 10 percent. 
Now, since more police records are in the FBI's Interstate 
Identification Index, Virginia's rate has doubled to about 22%. But the 
final clearance rate is faster than the FBI's in most cases. Virginia's 
disposition (court) records are mostly automated. Also, the Virginia 
State Police have designated officials in each courthouse to contact if 
the court record is not otherwise available.
    The Bureau of Justice Statistics reports that at the end of 1999, 
there were more than 62 million criminal history files held by criminal 
justice agencies throughout the country. Thirty-seven million of these 
records were in the FBI's Interstate Identification Index (III). Only 
23 million records in Triple I had disposition entries in them. This 
figure did represent a 3 million record gain from 1977, and almost 
double the 13 million dispositions in III in 1993.
    The Brady Act currently provides for ``three working days'' to 
complete the check (not including the day in which the inquiry was 
initially made). After that, dealers are then able to complete the sale 
to the buyer without a final answer from the FBI. However, if the gun 
is delivered to the buyer and the FBI subsequently obtains 
disqualifying information, the FBI immediately notifies the Bureau of 
Alcohol, Tobacco and Firearms, and the gun is retrieved. In Virginia, 
the state police retrieve the firearms. Only 16 such retrievals have 
been made there since 1989.
    The Clinton Administration has stated repeatedly that at least 72 
hours is needed to complete inquiries. Others contend that 24 hours 
should be the outside limit to process the inquiry. Gun show sales 
present a particular problem, since prospective buyers and sellers 
could not reasonably be expected to wait days after the show is over 
before the gun could be transferred to legitimate buyers.
    It is quite probable that both sides may be able to ``have their 
cake and eat it, too.''
    The Brady Act of November, 1993 provided for ``temporary'' five day 
waiting periods for handgun buyers while background checks were 
conducted by federal or state law enforcement officials. This provision 
expired at the end of November, 1998. The Dole-McCollum Instant Check 
system, first enacted in 1988, was revised and recodified as the 
National Instant Check System (NICS) in the Brady Act as the 
``permanent'' provisions. It was to be implemented by the FBI at the 
federal level, not later than the November date.
    Instant Check is a dual system in which a check can be performed by 
the FBI on inquiry directly from a dealer; or the inquiry can come from 
the dealer through a designated state agency point of contact (POC). 
Instant Check applies to ALL firearm sales, not just handguns, as was 
the case with Brady's waiting period provisions.
    Brady also authorized the National Criminal History Improvement 
Program (NCHIP) of federal financial and technical assistance for the 
states and local governments to automate criminal history records, and 
develop their own capacities to participate in NICS. Congress has 
appropriated more than $310 million to date for NCHIP; another $70 
million is requested for FY 2001. Regrettably, most of the funds have 
been diverted for other purposes, such as the purchase of automated 
fingerprint equipment. Hardly any of the funds have gone to state or 
county courts to automate their records.
    The FBI Operations Report for March, 2000 on page 13 states: ``Some 
state court systems have expressed significant difficulties in 
responding to NICS requests for information. some courts are seeking 
reimbursement from the NICS for the costs of locating disposition 
information. Unfortunately, this is not an expense for which the NICS 
can currently provide reimbursement.''
    The Bureau of Justice Statistics administers the NCHIP program. BJS 
has published annual summaries for the expenditures on its web page 
(http://www.ojp.usdo.gov/bjs), but it is not possible to identify 
exactly how the funds were spent. However, an inspection of the reports 
reveal that very few grants have been made to state or county courts 
for court record conversion, or to assist them in participating in 
NICS. As of June, 1999, 17 states conducted state instant checks, 12 
required permits and 4 maintained approval-type systems. At the present 
time, the FBI conducts checks requested by dealers directly in 25 
states.
    Since that time no new states have been added. In fact, one state, 
South Carolina, has already withdrawn. Another state, Florida, may 
withdraw shortly. Colorado had decided to withdraw, but reconsidered in 
the wake of a tragedy involving a firearm purchase by a prohibited 
person--who went undetected by an FBI check since Colorado records had 
not been sent to NICS. Virginia, the first state to implement Instant 
Check in 1989 has been providing software and technical assistance for 
other states upon request, but without federal funding support.
    The following are several specific recommendations to reconfigure 
the Instant Check deadlines, shift the focus of the funding priorities 
for the NCHIP to improve the operation of NICS, make the checks more 
relevant, and to accommodate new technology in several areas that will 
dramatically affect the operation of NICS in the very near future. Some 
of these recommendations are identical to those in my oral 
presentation; others were not included. They should be considered with 
the recommendations already submitted to the Committee.

                          NICS CHECK DEADLINES

    One of the most contentious gun control issues in Congress is the 
maximum time needed for the FBI and the states to complete an Instant 
Check if relevant records are not online. Pro-gun forces insist that 24 
hours is adequate to the perform the check. Strict gun control groups 
contend that at least 72 hours are needed. As was noted earlier the 
Brady Act provides for ``three working days,'' not including the day of 
referral.
    According to the FBI's Operations Report, all but about 28 percent 
of the checks performed by the FBI are completed within thirty seconds. 
All but 5 percent are completed within 2 minutes. All but 2 percent are 
cleared within 2 hours. However, in the instances where there is an 
unresolved question about the identity of the buyer, or there is a 
police arrest record but no disposition entry, a ``manual check'' must 
be made. It can take days to complete the check. Most often this means 
a phone call to the court house. This may take several days.
    This last group of checks is quite significant because in almost 
half of the cases, there is a final denial.
    At the state level, clearance times vary. Virginia was the first 
state to implement Instant Check in 1989. Since that time Virginia has 
conducted almost 1.8 million checks (see Attachment 2 submitted with 
oral testimony). All but about 22% percent of the inquiries are 
disposed of within a few seconds. Virtually all of the remainder are 
cleared within 2 minutes.
    There are several reasons for this outstanding capability. 
Virginia's criminal history records for felony arrests and convictions 
are almost entirely automated. Most of the county clerks' offices have 
a computer interface with the state police through the Virginia Supreme 
Court of Appeals automated system. When a county court record is not 
available online through the State Court, the state police have direct 
online access to most county courthouses. In the rest, the police 
simply contact predesignated county clerk officials by telephone or 
fax. Also, the state police have a well trained and experienced staff 
to conduct the record searches.
    A. It is quite feasible to mandate a 24 hour (one working day) 
turn-around time for a final response. However, there is no particular 
magic in this number. A much shorter time limitation--8 hours or less--
would still result in about 2 percent of the FBI checks unverified.
    B. There are several existing federal aid programs where funding 
could be increased or redirected to automate pertinent county 
disposition records. The focus must be on capturing ONLY felony, 
stalking and spouse abuse convictions and restraining orders that are 
RELEVANT to Brady checks, not all police arrest records, nor all county 
courthouse records.
    C. Until such time as the records are available in a timely fashion 
directly from criminal justice agencies, the FBI should make use of 
comprehensive databases compiled by various private background check 
companies. The use of private compilations should be on a county-by-
county basis after the FBI has determined that one or more of the 
private sources has the appropriate records available online.

                            GUN SHOW CHECKS

    The FBI estimates that there are about 3 million gun show sales 
annually. Until 1994, most of these transactions were at least recorded 
in the books of small dealers and the prospective buyers were required 
to certify that they were not ``prohibited persons'' under federal or 
state law not eligible to buy guns. These dealers typically did not 
have formal places of business, but were active sellers and traders at 
the shows. At that time, the Clinton Administration through the BATF 
cracked down on the small dealers. The number of dealers' licenses 
dropped from just under 230,000 in 1994 to about 80,000 today.
    As a result, many of these sales since 1994 were ``off the books.'' 
It is perfectly legal as a matter of federal gun control law, for an 
individual to sell a firearm to another person from the same state of 
residence. Most of the gun show transactions currently are unregulated 
and unchecked unless they are sold by a licensed dealer.
    A. There are several approaches to this situation that might be 
workable. First, follow the ``Virginia plan.'' It has been the national 
leader and has performed more than 1.8 million checks to date. It has 
highly automated criminal justice records--including court disposition 
records--at least at the felony level.
    Sixty-two of the state's largest gun dealers are on-line to the 
State Police. This accounts for 35% of the retail transactions. The 
initial turn-down rate in Virginia has been about 10%. In recent 
months, the rate has increased to just over 20%, as more NICS arrest 
records without disposition information must be cross-checked. The 
initial deferral rate by the FBI is 28%. The final denial rate--between 
1 and 1.5%--is the same for both Virginia and the FBI. The FBI has 
plans to have the largest gun dealers online within a year. This will 
allow for ``Unassisted checks'' directly from the dealer to the FBI. 
The FBI estimates that at the national level, approximately 15 percent 
of the largest dealers conduct about 80 percent of the retail gun 
sales.
    B. For more than a year, the Virginia State Police have been 
checking gun show transactions through booths at the major gun shows. 
Licensed dealers can also dial an 800 number. This system seems to be 
working quite well. At smaller shows, dealers simply use the 800 
number.
    C. Several states, as a matter of state law, require gun buyers and 
owners to obtain a special state license with a background check. This 
is only a partial solution and one that is not politically acceptable 
in most states. Usually the license is good for a several year period. 
In the meantime, the individual might become disqualified to purchase 
or possess firearms. Depending on state procedures for revocation of 
licenses, an up-to-date check may still be made to ensure that the 
buyer has not been disqualified since the license was issued.
    D. In the alternative, the state driver's license could be loaded 
with coded disqualifying information such a felony conviction. The 
dealer could swipe the driver's license through a credit card reader 
device to ``read'' the license.
    E. The FBI or BATF could set up booths at gun shows in ``non-
Brady'' states (about one half of the states at present). This should 
be done using federal personnel, or by a contractor. This would entail 
significant costs, and probably not be very workable or politically 
desirable. At least a feasibility study should be conducted on this 
possibility.
    F. When disposition information is not available to the FBI 
immediately, it would be quite possible for the Bureau to obtain the 
information on-line from commercial background check sources. There are 
a number of companies who spend hundreds of millions of dollars to 
capture court house records (see Attachment 3). An evaluation could be 
made of the validity of the commercial information. This can be done by 
comparing their data with information supplied from criminal justice 
sources where disposition information is available. In county 
jurisdictions where the Attorney General has found the local records to 
be inadequate, a private ``county check'' could be made by the FBI, and 
then verified when records from criminal justice sources become 
available.
    G. BATF regulations on small dealers should be changed to allow 
them to do business in a regulated manner. Under current ATF policies 
regarding zoning and business licensing requirements, it is easier for 
many active gun traders not to be licensed at all and to handle their 
transactions as individuals--even if they would prefer to be fully 
licensed and subject to background check requirements.

                            REFOCUSING NCHIP

    It is absolutely essential that the first priority for federal 
assistance be channeled to those jurisdictions where the courthouse 
records are not automated and where significant delays occur in 
responding to inquiries. This can be accomplished by Appropriations 
report language and riders in the four existing funding programs that 
could be utilized to complete and digitize court records.
    A pilot project, funded by Bureau of Justice Statistics, should be 
set up to compare private ``county'' checks for dispositions entries in 
the jurisdictions that are behind. For example, a thousand records 
could be processed through NICS, then the same checks could be done by 
accessing private databases. There are many private companies that 
perform background checks for various public and private purposes. They 
invest hundreds of millions of dollars annually capturing county 
courthouse records to build various automated data bases.
    This study will demonstrate that, at least on an interim basis, the 
FBI could utilize automated private data bases until the county records 
are available online through criminal justice channels. In fact, many 
governmental entities already relay heavily on private background 
checks for other purposes. The interim authority should be on a county-
by county basis.
    Another improvement is to create data bases that are more relevant 
to Brady checks. For example, a number of states are building DNA data 
bases on convicted felons. The name identifiers could be used for NICS 
checks, or simply establish separate data bases for convicted felons. 
The same is possible for stalkers and spouse abusers. These are usually 
misdemeanor records at the county court house. Unless a felony is also 
involved, they typically do not get entered into state or federal data 
bases unless the state has a law specifically requiring the reporting. 
Most of these records are not fully automated. BJS should initiate an 
NCHIP project to analyze current policies and practices for performing 
the Brady checks and develop recommendations for improvement. A model 
database should be designed to meet the specific requirements for Brady 
checks as defined in Section 922 of the Gun Control Act.
    The Justice Department should undertake a comprehensive analysis of 
the reasons for delay in affirmation of identity or criminal 
background. Look at the states and counties where most of the problems 
occur, and direct NCHIP funds at the problem. Use the results of this 
study to reorder the funding priorities for NCHIP. There are several 
other Bureau of Justice Assistance grant programs that could be tapped 
to support the program, such as the Byrne program for local law 
enforcement assistance.
    Congress should set the priorities for NCHIP funding for FY 2001 
through Appropriations report language and riders to provide funding 
for automating court disposition entries and for technical assistance 
and funding for more states to become POCs.

                      USER FEES FOR INSTANT CHECKS

    When the NICS regulations were first promulgated, the FBI wanted to 
charge dealers (and buyers) to perform the instant checks. This attempt 
was strongly opposed by the NRA. As a result, Congress has provided 
full funding to operate NICS at no cost to the dealers or buyers. 
However, the FBI has never charged state POCs, since this was a ``law 
enforcement service,'' for which the Bureau traditionally has not 
charged fees.
    The Bureau does charge INS up to $20,00 each for a million 
background checks per year on persons seeking immigration benefits. The 
banking industry is also charged a similar amount for checks on 
prospective employees, as authorized by Federal law in 1968. These are 
fingerprint-based checks. INS no longer accepts manual fingerprint 
cards from US applicants. They must go to an INS facility to have 
digitized fingerprints and mug shots taken. With the Bureau's new IAFIS 
system in operation, these checks now are processed in two hours. Under 
the old manual system, the checks took many weeks or months. When the 
two print system is in operation, turnaround time will be decreased 
even more.
    It is recommended that ALL Brady gun buyer checks be considered as 
``law enforcement'' checks, whether from a state law enforcement agency 
(POC) or a dealer.
    If all Brady checks are redefined as ``law enforcement,'' dealers 
should get the same ``immunity bath'' as a law enforcement for relying 
on information provided through the Brady system. This was a provision 
of last year's Lautenberg Gun Show Amendment.

                          EXPANDING THE SYSTEM

    A. There are any number of ``non-law enforcement'' requirements for 
background checks. NICS should be expanded to cover truck drivers, 
bounty hunters, child care workers or volunteers, etc. where the 
information in NICS would be relevant to the profession involved. Many 
of these checks are already required as a matter of federal or state 
law. User fees could be collected to cover the entire operating costs 
of the system. Participating state agencies that perform Brady checks 
could also participate and share in the revenue stream. This should 
provide incentives for the states to participate or stay in the system.
    B. At the present time the system is online only seventeen hours 
per day. IT SHOULD BE EXPANDED FOR FULL TIME OPERATION. Significant 
costs would be involved to move to round-the-clock operations. Hardware 
and software would need modification and upgrade. This would be 
essential if the FBI performed gun show checks.
    C. As was mentioned above, gun show checks would add at least 
another 100,000 checks per month over the current workload of 500,000 
checks. Additional personnel, equipment and overtime would be needed to 
handle the increase.
    D. The recent shutdowns of the NICS system, in which it was down 
for almost 3 days in the first instance and almost a day in the second 
instance, have dramatically underscored the need to have a redundant 
backup system available in case the primary system goes off-line. The 
backup could also be available to handle overload situations and non-
law enforcement checks. The FBI estimates that this upgrade would cost 
approximately $7 million.

                        NICS ADVISORY COMMISSION

    In the past, the FBI utilized its general advisory group, the 
Advisory Policy Board (APB), to advise it on matters relating the NICS. 
However, there is a separate board for Instant Check. It consists 
overwhelmingly of law enforcement officials, and its proceedings are 
not made public. However, with the Interstate Compact on the interstate 
exchange of criminal history information now in place, this twelve 
member group is also getting into the picture. Like APB, this group is 
composed primarily of law enforcement authorities. There is no 
representation of the public, or gun manufacturers, dealers or owners.
                revise ``prohibited person'' categories
    It is strongly recommended that the list of ``prohibited persons'' 
in section 922(c) of the Gun Control Act of 1968 should be revisited. 
There have been very few changes since the original list was added as a 
Senate floor amendment to the Act. There was no hearing record for the 
provision at the time. Several of the categories made little or no 
sense; others required access to data bases not generally available to 
law enforcement.
    For example, persons who voluntarily renounced U.S. citizenship or 
their employees were banned. Persons ``addicted to stimulants, 
depressants or other dangerous drugs'' and ``adjudicated mental 
incompetents'' also were prohibited. Felons were barred forever, no 
matter whether the conviction was for a violent or non-violent offense. 
Definitions of the various terms were quite vague or non-existent.
    The changes made since that time haven't done much to improve the 
situation. The Lautenberg Amendment in 1996 added persons who were 
convicted of spouse abuse or stalking, and the 1994 crime bill added 
those under certain court restraining orders. Neither of these 
categories of records are readily available in any uniform fashion.
    Other record checks, such as violent juvenile offenders and DUI 
convictions are not specifically authorized. Several states now treat 
certain juvenile records as if they were adults. Although the FBI does 
accept juvenile records, it does not receive many of them from state or 
local agencies. Also, the BATF issued regulations authorizing access to 
drunk driving records. These checks only go back six months, and 
usually involve only criminal convictions, not civil.
    The FBI and the states now have sufficient experience in performing 
Brady checks to be able to make comprehensive recommendations for 
revision of the ``prohibited person'' provisions.
    89access related data bases
    A Brady check, whether done by the FBI or the states individually 
or jointly, involves access to a variety of related data bases. At the 
same time, access to other data bases is not available in whole or in 
part, because of administrative or legislative restrictions.
    A. The U.S. Immigration and Naturalization Service operates several 
databases on persons lawfully admitted to the U.S., as well as 
individuals who are ``criminal'' aliens. These are individuals who have 
been deported, under deportation order, arrested, detained, and 
convicted and incarcerated. In the federal inmate population, almost a 
third are ``illegal aliens.'' The federal government provides subsidies 
amounting to tens of millions annually to states whose criminal justice 
systems are heavily impacted by criminal aliens.
    Under the Gun Control Act, ``illegal aliens'' are prohibited 
persons. However, until recently, many out-of-status aliens were not in 
the NICS system. the INS and FBI did not share information on several 
of the key INS data bases, even though the INS must provide this 
information to state and local enforcement by federal law. Since there 
many Brady ``hits'' on illegal aliens, the FBI access to other INS 
files should be expanded.
    B. There is much controversy about access to juvenile records, but 
many states are now making records available, at least for crimes of 
violence. There is a trend to treat more juveniles as adults. As was 
indicated earlier, even though the FBI will accept the juvenile 
records, very few of these records are available to the BUREAU.
    C. A particularly thorny issue is the inclusion of mental health 
and substance abuse records. At present the NICS has access to about 
200,000 VA records, but the situation at the state level is quite 
mixed. In general, there is limited access at best. By BATF regulation, 
the FBI does lock at certain DUI records, but only for the previous six 
months.
    The Department of Transportation maintains a national data base on 
bad drivers (NDR). By the terms of its enabling legislation, these 
records are not shared with law enforcement. However, state DMV's 
routinely share this information with state and local enforcement 
agencies. After all they are responsible for enforcement of traffic 
laws. The federal policy is totally unrealistic. This data base may be 
useful to NICS checks. A pilot study should be conducted on its 
feasibility.

                              [Attachment]

             PRIVATE COMPILERS OF CRIMINAL HISTORY RECORDS

    A large number of private companies perform criminal history 
background checks for government and commercial clients. Most of these 
checks are mandated by federal or state law. These companies spend 
hundreds of millions of dollars annually to digitize federal, state and 
local public records of all kinds, including public records from 
repositories of original entry, such as federal district court, police 
station house or country clerk's office.
    The records are then added to various data bases. When a check is 
made by one company, it will frequently access and cross reference 
other bases in addition to its own.
    Representative of these organizations are the following:

1. ChoicePoint, Inc., Atlanta, Georgia www.order.choicepointinc.com
2. Knoll Background America, 1900 Church Street, Nashville, Tennessee 
    37203, 615/320-9800, www.background-us.com
3. DAC Services, 4110 100th East Avenue, Tulsa, Oklahoma 74146, 800/
    331-9175, www.dacservices.com
4. DBT Online, Inc, 4530 Blue Lake Drive, Boca Raton, Florida 33431, 
    800/530-4539, www.dbtonline.com

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    Senator Dole. I have been asked, if there is no objection, 
that I offer a statement for the record of Congressman Bill 
McCollum, who you worked with, I worked with, others worked 
with in finally getting this done.
    The Chairman. Without objection, we will put that in the 
record.
    [The prepared statement of Mr. McCollum follows:]

  Prepared Statement of Hon. Bill McCollum, a U.S. Representative in 
                   Congress From the State of Florida

    Mr. Chairman and members of the Committee:
    Thank you for the opportunity to testify this morning on the 
subject of the National Instant Check System. The NICS system is one of 
the clearest examples in recent years of the Federal Government working 
smarter--not just harder--to fight crime and make America's streets and 
schools safer. It is also a great example of how federal resources and 
know-how can be put to use to help states fight crime and improve 
public safety. An effective Federal-State partnership, which continues 
to recognize the primary role played by the States in crime-fighting, 
is essential to making good on our commitment to combat violent crime 
and drugs.
    The bottom line is clear: America is a safer place as a result of 
the NICS system. But I must hasten to add: It can be made safer yet by 
upgrading the NICS system and by a actually prosecuting those who are 
caught trying to buy a firearm illegally. A convict or other prohibited 
purchaser who has been caught by the NICS system seeking to purchase a 
firearm is a tragedy waiting to happen. And if we prosecuted these 
would-be purchasers for their illegal attempt to buy a gun. I am 
confident we would prevent countless crimes and untold heartache. Even 
as we can all agree that preventing criminals from obtaining firearms 
is the right thing to do, so we can all agree that prosecuting those 
who illegally attempt to purchase a firearm is the right thing to do.
    I want to associate myself with the testimony of my good friend, 
Senator Dole, with whom I worked to establish the NICS system. And in 
particular, I want to enthusiastically endorse his proposals for 
improving the system. The NICS system should operate 24 hours a day; It 
must be backed up in case of a breakdown in the primary operating 
system; more resources must be spent directly on making state records 
immediately accessible to the NICS system; And we must ensure that all 
of the States that perform their own background checks are linked to 
each other and the NICS system. Finally, I believe we must make the 
investment of resources and know-how necessary to make the instant 
check system truly instant. This would advance both the cause of public 
safety and law-abiding citizens.
    Thank you.

    The Chairman. Thank you, Senator Dole, for an excellent 
statement.
    Senator Durbin, we turn to you.

 STATEMENT OF HON. RICHARD J. DURBIN, A U.S. SENATOR FROM THE 
                       STATE OF ILLINOIS

    Senator Durbin. Thank you very much, Mr. Chairman and 
Senator Schumer. First, let me tell you what an honor it is to 
share the table with Senator Dole. Just a few weeks ago, we 
shared another table. We had lunch in the Senate dining room 
and our guest was a former Senator named George McGovern. We 
turned every head in the restaurant when we walked in. Senators 
Dole, McGovern and I had gathered to talk about an unrelated 
issue but one we consider of equal importance. I am glad that 
Senator Dole continues his interest in policy and I am happy to 
be working with him and joining you today.
    Mr. Chairman, as you know, the 1994 Brady Handgun Violence 
Prevention Act established the NICS system and required Federal 
firearm licensees to conduct a background check on the 
purchaser of any firearm. NICS is designed to respond within 30 
seconds in most background checks. Depending on the willingness 
of their State governments to act as a liaison for NICS, 
Federal firearms licensees will contact either the FBI or a 
designated State point of contact, POC, to initiate background 
checks on individuals purchasing firearms. My home State of 
Illinois is a POC for NICS.
    Just this past March, the FBI released a report of the NICS 
operation. GAO also released two NICS reports, one in February 
and one in April of this year. Senator Schumer and I requested 
the latter of these studies. My testimony will be based in 
large part on these documents.
    As Senator Schumer said, approximately 72 percent of the 
4.4 million background checks conducted by the FBI in the first 
year of operation issued an instant approval within 30 
seconds--72 percent within 30 seconds. NICS issued a delayed 
response for the remaining 28 percent and the FBI resolved 80 
percent of those, providing a definitive proceed or deny 
response back to the dealer within 2 hours. This means 95 
percent of all gun owners have their checks resolved within 2 
hours.
    Mr. Chairman, the FBI also found that those prospective 
buyers whose check cannot be resolved in 24 hours are 20 times 
more likely to be prohibited persons than the average gun 
buyer. I think that is a point worth repeating. Once we have 
gone through the computer check, those who are checked very 
quickly have approval almost immediately but those who are not 
checked very quickly turn out to be 20 times more likely to be 
prohibited from a sale. So if the system slows down, there may 
be good reason.
    With regard to system availability, GAO found the average 
availability for the first year of NICS was 96.6 percent. This 
means that NICS was unavailable only 3.4 percent of its 
scheduled hours. Moreover, 70 percent of the NICS 
unavailability in the first year was due to the failure of a 
connected system, such as the Interstate Identification Index, 
or IAFIS, not the failure of NICS.
    In its first 13 months of operation, NICS has been a highly 
effective system for keeping guns out of the hands of criminals 
and kids. Having processed ten million inquiries during this 
time, NICS has ensured the timely transfer of firearms to law-
abiding citizens while denying transfers to more than 179,000 
felons, fugitives, and other prohibited persons. In addition, 
Mr. Chairman, it should be known that NICS is accurate. Only 3 
percent of the FBI denials of firearm purchases were overturned 
on appeal during the first year.
    Mr. Chairman, NICS is a very important system that provides 
valuable law enforcement information. However, more 
comprehensive criminal history records are currently available 
at State and local levels instead of the Federal level, and 
many States have elected to serve as POC's to access NICS. As I 
mentioned earlier, my home State of Illinois is one of the 15 
States that have elected to serve as POC to access NICS. Many 
Federal firearms licensees contact Illinois rather than the FBI 
because Illinois' POC background checks review more records of 
people in prohibited categories, such as people who have been 
involuntarily committed to a mental institution or those under 
a domestic violence restraining order.
    Illinois spends about $600,000 a year as a State for its 
POC system to run an effective Brady background check. Illinois 
pays the full cost of the mandated Brady background checks 
while other States pay nothing and rely on the FBI to conduct 
them. Congress needs to remedy this inequity.
    Mr. Chairman, I will be introducing legislation, along with 
my colleague and your colleague on the Senate Judiciary 
Committee, Senator Pat Leahy, which will reimburse States for 
the cost of Brady handgun background checks. This proposed 
legislation is only fair, and I thank Senator Leahy for his 
leadership on this issue.
    Mr. Chairman, I know that in light of the May 11 failure of 
the complex interconnected database that resulted in a NICS 
service outage there is a question as to the effectiveness and 
availability of background checks. However, it should be noted 
that although the service was down 66 hours, the system did not 
experience any problems before then. Nevertheless, the FBI 
Criminal Justice Information Services continue to work with 
software providers to identify potential database management 
problems and to develop procedures to prevent future 
occurrences. They are committed to fulfilling Congressional 
expectations for access to accurate and timely CJIS information 
at lower cost and greater convenience.
    Let me close with two points, Mr. Chairman, that are 
related to this discussion. First, I happen to believe that a 
waiting period is a good idea. I think a 3-day waiting period 
is not unreasonable. Not only does it give local law 
enforcement officials the opportunity to look at mental health 
histories and records of domestic abuse and decide whether, in 
fact, the sale is in the best interest of peace and law and 
order in the community, it also provides a cooling off period 
for people who very emotionally go forward to buy a handgun to 
use it for the wrong reasons.
    Second, I hope that when you consider the categories of 
people to be prohibited from purchase, that we will consider a 
very obvious category. Senator Boxer offered an amendment on 
the floor which said that if a person shows up to buy a gun and 
is intoxicated, he will be refused. That should be a category 
included. That should not even be debated. If a person is 
intoxicated and tries to buy a gun, a dealer should not sell it 
to him. The Senator's amendment was adopted by a voice vote and 
quickly scuttled as soon as it left the Senate. I think it is a 
sensible thing to do, to make sure that we do not put guns in 
the hands of people who will misuse them either because of 
their intentions or because of their mental state or because 
they are intoxicated.
    Mr. Chairman, I thank you for the opportunity for 
submitting my testimony today.
    The Chairman. Thank you, Senator Durbin. I might mention 
that Utah is also a point of contact for the NICS system. We 
will be hearing later from Captain Smith about Utah's efforts. 
Senator Leahy and I are exploring ways we can encourage more 
States to act as point of contact States, and that is one of 
the ways we might be able to help solve this. You both have 
given excellent statements here today.
    Senator Dole. Could I just make one additional comment?
    The Chairman. Sure.
    Senator Dole. I wanted to indicate for the record that the 
staff member who helped me when I was on the Judiciary 
Committee, Pete Veldi, volunteered to help me some with this 
statement and some of the follow-up material. Pete's father was 
a member of Congress, chairman of the House Un-American 
Activities Committee a long time ago and he probably knows more 
about gun legislation, was here and worked for Senator Hruska, 
who was a member of this committee, and was present when they 
passed the 1968 Act and has been very active ever since. I want 
the record to reflect that.
    Also, another former staffer who I just happened to run 
into this morning, Randy Schuneman, is another gun expert and 
Randy is here, I guess, with another witness.
    The Chairman. Pete and Randy, we are happy to have both of 
you here, as well. Those are great accolades by our former 
Majority Leader. We are just honored to have you here, Bob, and 
certainly you, too, as well, Senator Durbin. We miss you on 
this committee. I think both of you have busy schedules, and 
unless there are any questions----
    Senator Schumer. I just have one, Mr. Chairman. I again 
want to thank both Senator Dole and Senator Durbin for being 
here and for their work on this issue. Senator Durbin and I 
have worked together, as we did on the GAO report, on many gun 
issues, and I will never forget those days, Senator Dole, when 
the Brady bill came up and the crime bill. We had different 
views then, but you were a totally on the facts, on the merits 
person, which I very much appreciate.
    I just had one question that your testimony almost begged 
me to ask, so I will, and that is, what is your opinion on 
extending the Brady law, or now the InstaCheck to gun shows, 
closing the gun show loophole?
    Senator Dole. I think there is a compromise floating around 
here somewhere, and we tried to point out, if you get all but 2 
percent, and that can be accomplished, and then you have the 
GAO report that said they are 20 times more likely to commit a 
crime, even of the larger percentage, I just believe there are 
enough people like Senator Hatch, yourself, and others who can 
resolve this issue this year.
    I mean, there are a lot of politics involved, believe me. I 
did not receive the NRA endorsement in 1996 and a lot of it 
went back to what happened in 1993 and later on assault 
weapons, though I voted for their position. But they had a 
person at the NRA at the time who took a dim view of me. She is 
now gone.
    Senator Schumer. She took an even dimmer view of me, 
Senator, I remember. Do not worry.
    Senator Dole. I am not here representing anybody's 
position. I am just here trying to suggest that we are off to a 
good start, improvements ought to be made, and there has got to 
be a way to figure out this gun show thing.
    Senator Schumer. Thank you. Thank you, Senator.
    The Chairman. I might just say, one of the reasons that we 
have such a difference over the gun show issue in both houses 
is due to the delays and indifferences with NICS. I, naturally, 
like you, Senator Dole, Senator Durbin, and Senator Schumer, I 
would prefer to work these problems out. It is much more 
difficult than I thought, but----
    Senator Dole. Of course, the bottom line is to get more 
money in the NICS program----
    The Chairman. Right.
    Senator Dole [continuing]. Get these records and help the 
States, as Senator Durbin has pointed out. It is never going to 
be perfect. Somebody is going to slip through. But, boy, it is 
closing pretty fast.
    The Chairman. That is a very good suggestion. We want to 
thank both of you for being here and it is great to see you 
again, Senator Dole, here again in the Judiciary Committee. We 
appreciate you, and we appreciate you, Senator Durbin. Thank 
you. Thank you both for being here.
    I would like to call forward our second panel of witnesses 
and ask them to take their seats at the table. Our first 
witness is David Loesch, the Assistant Director in Charge of 
Criminal Justice Information in Clarksburg, WV.
    We are also pleased to have with us Captain Stuart Smith, 
Director of the Utah Bureau of Criminal Identification and 
Utah's point of contact with NICS.
    Our next witness after that is Max Schlueter, Director of 
the Vermont Criminal Information Center and Vermont's point of 
contact with NICS.
    And we are finally pleased to have with us Robin Ball, the 
owner of an indoor shooting range and a retail facility in 
Spokane, WA.
    Good morning to each of you and welcome to our hearing on 
improving the National Instant Criminal Background Check 
System. We are grateful to have you all here. We will start 
with you, Mr. Loesch, first.

  PANEL CONSISTING OF DAVID R. LOESCH, ASSISTANT DIRECTOR IN 
CHARGE, CRIMINAL JUSTICE INFORMATION SERVICES DIVISION, FEDERAL 
     BUREAU OF INVESTIGATION, U.S. DEPARTMENT OF JUSTICE, 
CLARKSBURG, WV; STUART SMITH, BUREAU CHIEF, UTAH DEPARTMENT OF 
  PUBLIC SAFETY, BUREAU OF CRIMINAL IDENTIFICATION, SALT LAKE 
 CITY, UT; ROBIN BALL, OWNER, SHARP SHOOTING INDOOR RANGE AND 
  GUN SHOP, SPOKANE, WA; AND MAX SCHLUETER, DIRECTOR, VERMONT 
   CRIMINAL INFORMATION CENTER, VERMONT DEPARTMENT OF PUBLIC 
                     SAFETY, WATERBURY, VT

                  STATEMENT OF DAVID R. LOESCH

    Mr. Loesch. Thank you, Mr. Chairman. Good morning to you 
and the members of the committee. I would like to thank you for 
the opportunity to speak here before this committee today.
    The two Senators that spoke before me and Senator Schumer, 
I agree with a lot of what they had to say. I have got an 
opening statement which has been given to you already and I 
would just ask that that be accepted.
    The Chairman. We will put all complete statements in the 
record, as though fully delivered.
    Mr. Loesch. I would like to mention, first of all, that 
this has been a cooperative effort of an awful lot of people, 
both within ATF, the States, the locals, our gun dealers, the 
various associations. I think that, like Senator Schumer had 
mentioned, I was amazed that this came out the way it did and 
as successful as it is, and it is 30 seconds for 72 percent, or 
71 percent today, of those, and 95 percent of those checks are 
done within 2 hours. We can do better. We have got some things 
underway that will assist us in getting down to probably in the 
neighborhood of 80 percent on these Instant Checks on the first 
pass and we are piling some things in the division right now 
that would help do that.
    I would like to at least explain a little bit. I have 
brought some charts up here that would help people, I think, 
get a good picture of this. The NICS system itself is a very 
complex system which operates really off of three different 
databases, the three databases being the III, which Senator 
Dole had mentioned, and today we have about 41 States that are 
part of that III process right now. That has got 36 million 
criminal histories in it. That is the piece that we had some 
problem with here in May that went down, and it was corruption 
of the database and we are working through that. We have made 
some changes here recently, some short-term changes which we 
believe will assist us in keeping that problem from happening 
again. We are not positive that it will, but we are pretty sure 
it will as we work through the root cause of what that has to 
do with it.
    All of these databases are backed up, they are redundant. I 
mean, they do have recovery. We do not lose any information. I 
want everybody to be clear on that, that we do have a way--we 
back all these up every evening with tapes, all of these 
systems, so we do have a way of recovering, although we would 
prefer that it not take us 66 hours like that first time in May 
on that Mother's Day weekend.
    Our goal is obviously to have 100 percent availability. We 
are not going to rest until we get 100 percent availability. 
For the most part----
    The Chairman. How many States are fully complying with NICS 
now?
    Mr. Loesch. Right now, we have 15 States act as full points 
of contact and we have 11 States that are partial points of 
contact. In other words, they may do the handguns but we would 
do the rifles or shotguns for them. We are doing 38 States or 
territories within the FBI, and as you heard from other people 
that testified earlier, we are doing about 50 percent of that 
13 million checks that have been done so far and the States are 
doing about 50 percent.
    The Chairman. What about the other 12 States? What is 
happening there?
    Mr. Loesch. They are all included in those numbers.
    The Chairman. All 50 States are----
    Mr. Loesch. All 50 are included within there. You can see 
the availability of the system was 96 percent, and that is 
good, but really, I mean, in systems like this, you need to be 
99.5 or 99.6 percent available, like the NCIC 2000 is.
    The NICS, I had one other chart that was talking about the 
three systems, but I will just talk about them. The three 
systems are III. That is the biggest database. That is 95 
percent of your entire NICS check is in that particular 
database.
    Then we have what is called the NICS Index, and that has 
about a million records and that is one we built ourselves and 
primarily what is put into that system are Federal agencies, 
primarily--INS, the Department of Veterans Affairs, the 
military or the Defense Department.
    And then we have the NCIC 2000, which are a bunch of hot 
files that are used by every single law enforcement officer 
throughout the country day in and day out. It is very important 
that those keep up, and those were kept up even when we had the 
III outage, and that is where you have your wanted people, over 
500,000 wanted persons, over 300,000 protection orders, those 
types of things.
    So they are all--each of these was developed at a different 
time for really a different purpose and what we tried to do is 
meld all these things together now, and we are learning. I 
mean, when we first brought NICS up, we were doing great 
because it was only just NICS, the NICS database. But when we 
brought IAFIS, the Integrated Automated Fingerprint System, 
which most of you are very well aware of, on the fingerprint 
system, that it does the checking, which was that $640 million 
project, that has three segments, and III, or the system that 
went down recently, they are a part of that and we are learning 
as we go, basically, to make this better, and we are not going 
to rest.
    We have got a lot of things set up here to make this better 
and more redundant and I think Senator Dole had mentioned the 
possibility of a hot back-up. We are not even sure a hot back-
up of III, and he mentioned $7 million for that, that that 
would have been the answer in this case. If it was a hot back-
up, the same problem might have exhibited itself in that 
database in the hot back-up.
    One of the things that has been causing some delays is a 
lot of the III transactions, which is the biggest database, 
they have to process through our ITN, which is the 
Identification Tasking and Network System, the traffic cop with 
300 bundles of software in IAFIS. We are looking now, whenever 
IAFIS goes down or that ITN system goes down, the NICS goes 
down because you do not have that huge database that you need 
to check. So what we are trying to do now is have a pathway 
directly into that III, and I think that is going to really go 
a long way in giving us even quicker responses.
    We have over 60 software fixes that we are working on this 
year to make these systems more reliable and more redundant and 
better, along with some very large ones, including giving the 
dealers themselves access, direct access. Instead of using a 
telephone call center, we would actually have the dealer would 
be putting the information in and getting his answer right 
back, and I think that that is going to go a long way in 
assisting timeliness of these checks.
    I would be remiss if I did not say something about the 
people in the CJIS division and the division I am in out there 
that have helped make this the success that it is, the over 500 
people that work really day and night and they take their job 
very seriously, let me assure you of that. Our job is law 
enforcement information services, and it is keeping the public 
safe and our police officers safe. So when these systems go 
down, our first priority is to bring the law enforcement 
services up that the cop on the beat needs to do his job, and 
so it is very important that these things be up and running all 
the time and we will not rest until that is done.
    The items that I believe that would go a long way in 
assisting us would be the same items that the GAO. We support 
all of those items, the continued funding for NCHIP funding for 
the States to work on their records disposition, definitely 
some type of financial assistance to our State partners there 
that are the points of contact that continue to do this 
business for us, and rest assured, they do have the more 
complete records. They have more complete records and they have 
more access to their own data. They understand their firearms 
rules and they are probably better capable, really, of getting 
the dispositions.
    Then the other thing would be something to do with that 
last 5 percent. You know, we have that 5 percent that we are 
not sure because we cannot find a disposition within that three 
business days. I would mention that in 18 months, we have had 
180,000 what we would call a default proceed, 180,000 cases 
where we do not know what happened to them. In other words, 
somebody came in, we got a hit that there was a disqualifying 
arrest, but we could not find the disposition. We look for 2 
weeks actively even after we get these things.
    We continue to work with the State and the gun dealers and 
tell them, but we have to tell the gun dealer after that three 
business days, you can proceed if you want to. The law allows 
you to proceed if you want to. Some gun dealers decide not to 
do that. In other cases, they may sell the weapon. We had to go 
out and collect 6,000 weapons back in 18 months. That is just 
the ones that the FBI knows about that we do those checks out 
of the six million checks we have done. That 180,000, I have no 
idea what happened to those. We do not know because a lot of 
cases, the information is already deleted out of the file. We 
do not know whether they got sold or not.
    I would just thank you for the time to be here. I am 
certainly available for questions, and I would invite every 
member of this committee and your staffs and anybody in the 
audience here that would like to visit us. This is no secret, I 
mean, to come out and talk to our employees and see how this 
thing operates. It is a tremendous process. I think it is 
working. I think we can do better and we are going to continue. 
You have our promise that we will continue to do that for you. 
Thank you very much.
    The Chairman. We appreciate your testimony and appreciate 
your efforts and your dedication to them because it is a good 
system if we can keep it up and running.
    I think one of the biggest problems I have in trying to 
bring about a final resolution of this, because it is all 
caught up in politics and I am not about to let people get 
together and just rave on and on and make this even tougher to 
do. But one of the problems is, there is a lot of distrust, 
whatever administration, but certainly this one right now, that 
if we had, say, a 3-day delay in the juvenile justice bill, 
that ultimately--for only 5 percent of the people--that 
ultimately that would be 15, 20, 25, 30 percent of the people, 
that there would be politicians making those decisions to just 
make it tougher and tougher to buy a firearm, and that is one 
of the problems that we have. Do you see that as a problem?
    Mr. Loesch. I really do not, not within the FBI or 
anybody----
    The Chairman. Nobody there at the FBI would be so gun 
control oriented that they would skew the records and delay 
this or drag it out?
    Mr. Loesch. Absolutely not. I have been in the government 
30-some-odd years with military time and everybody are devoted 
civil servants. I mean, we are there to serve. We are doing 
this because someone made a law and the Attorney General put 
that in our camp and we continue to strive to do--the FBI 
continues to be exceptional at everything they do.
    The Chairman. Thank you, Mr. Loesch.
    [The prepared statement of Mr. Loesch follows:]

                 Prepared Statement of David R. Loesch

    Good afternoon Mr. Chairman and distinguished members of the 
committee. I am David Loesch, Assistant Director in charge of the FBI's 
Criminal Justice Information Services Division, otherwise known as 
CJIS, located in Clarksburg, West Virginia. Thank you for the 
opportunity to speak to you today about the national instant criminal 
background check system, or NICS, which the FBI operates under the 1993 
Brady Handgun Violence Protection Act.
    The Brady Act requires background checks on firearm purchasers 
before a federally licensed gun dealer can transfer a gun. Brady Act 
background checks replaced what used to be an honor system under the 
Gun Control Act, where gun dealers generally accepted at face value 
buyers' representations that they were not prohibited from possessing a 
firearm. For the first five years after the enactment of the Brady Act, 
the background checks were limited to handgun transfers and were 
performed by the chief law enforcement officer where the gun dealer was 
located. Beginning on November 30, 1998, dealers were required to 
contact the NICS for Brady background checks.

                           WHAT IS THE NICS?

    The NICS is a system established by the attorney general to provide 
information to gun dealers on whether a transfer to a non-licensee of 
any firearm, including handguns and long guns, would violate Federal or 
State law. At the attorney general's direction, the FBI developed the 
NICS though a cooperative effort with the ATF and State and local law 
enforcement agencies. The NICS is a computerized background check 
system designed to respond within 30 seconds on most background check 
inquires.
    The system was designed so that States can agree to serve as a 
point of contact, or POC, for the NICS. A POC State designates a State 
or local law enforcement agency to receive and process NICS checks for 
the dealers in that State. There are 15 States that serve as POCs for 
all firearm transactions. Some States serve as a POC for handguns only. 
We refer to these States as partial-POCs; currently, there are 11 
States that serve as partial POCs. In States that decline to serve as a 
POC for the system, or for long gun transfers in States that are 
partial POCs, dealers request a NICS check by calling a toll-free 
number and providing information identifying the purchaser to a call 
center under contract with the FBI. The call center then forwards the 
information electronically to the FBI NICS operation center, operated 
by CJIS in Clarksburg, West Virginia, for the processing of the 
background check.
    As of June 5, 2000, After 18 months of operation, a total of 
13,364,378 background check requests have been processed through the 
NICS. Of these, 6,748,795 have been processed through the POC States, 
and 6,615,583 have been processed through the NICS operations center. 
We are extremely grateful to our State POC partners, not only because 
they carry approximately half of the nationwide workload in processing 
NICS checks, but also because they enhance the thoroughness of NICS 
checks by checking otherwise unavailable State databases and by 
bringing to the checks expertise in their own State laws regarding 
firearms eligibility.

                         HOW A NICS CHECK WORKS

    A NICS check begins after a prospective purchaser provides photo 
identification to the gun dealer and fills out an ATF firearms 
transaction form, known as a form 4473. The dealer then calls the 
appropriate contact point, either the State POC or the call center that 
processes the calls for the FBI's NICS operations center, and provides 
certain identifying information from the 4473 that is used to search 
the database for possible matching records. The identifying information 
includes name, date of birth, sex, race, and State of residence, and 
any other identifying information, such as social security number, that 
may have been voluntarily provided by the prospective purchaser. This 
identifying information is used by the NICS to search three FBI-managed 
information systems for matching records. See chart, ``databases 
searched by the NICS.'' The three databases contain over 37 million 
records and include:
    (1) The National Crime Information Center (NCIC) 2000 which 
contains over 500,000 records on wanted persons and nearly 250,000 
subjects of protection/restraining orders;
    (2) The interstate identification index, or III, which contains 
approximately 36 million active criminal history records; and
    (3) The NICS index, which contains over 1 million records of other 
persons prohibited from possessing a firearm, including individuals 
involuntarily committed to a mental institution or adjudicated mentally 
defective, illegal aliens, and individual dishonorably discharged from 
the Armed Forces. In POC States, State databases, in addition to the 
FBI databases, are also checked for disqualifying information. These 
State databases include the State's own criminal history records and, 
in some cases, State records on persons who have been involuntarily 
committed to a mental institution or are under a domestic violence 
restraining order.
    If the database check does not yield a record that potentially 
matches the identifying information provided to the system by the 
dealer, then the call center responds immediately advising the dealer 
that the transaction may ``proceed,'' meaning that no information was 
discovered demonstrating that the person is prohibited from possessing 
a firearm. In addition to the proceed response, the NICS provides the 
dealer with a unique number associated with the check, known as a NICS 
transaction number (NTN), which the dealer is required to record on the 
4473. It takes 30 seconds or less to provide an immediate proceed after 
information is entered into the NICS. About 71 percent of all 
prospective gun purchasers are authorized by the NICS to make their 
purchase immediately. See Chart, ``NICS Operation Transaction 
Breakdown.''
    If the check hits on a record that could match the individual, then 
the call center advises the dealer that the transaction is ``delayed.'' 
The call center provides the dealer with an NTN. The transaction goes 
into the NICS ``delay queue,'' and is automatically referred to a NICS 
examiners. NICS examiners are specially-trained FBI personnel, who, 
unlike the call center personnel, are allowed to access criminal 
history and other sensitive information. The NICS examiner will take 
the transaction out of the delay queue, and review the record to 
determine whether it is complete, whether it matches the prospective 
buyer, and whether it demonstrates that the person is disqualified from 
possessing a gun. If the record demonstrates that the person is 
disqualified from possessing a gun, the NICS examiner will advise the 
dealer that the transaction is ``denied.'' If the record is incomplete, 
or inconclusive, then the examiner attempts to acquire complete 
information to make the determination whether the prospective gun buyer 
is legally allowed to acquire a firearm.
    NICS provides a definitive response of either ``proceed'' or 
``denied'' to 95 percent of all requests within 2 hours of receipt of 
the information to search the NICS. Only 5 percent of prospective 
purchasers have to wait more than 2 hours for a NICS response, and 
these persons are given their response as soon as the NICS obtains the 
necessary information. A purchaser whose NICS check takes more than 24 
hours to complete is almost 20 times more likely to be a prohibited 
person than the average gun buyer.

                     THE RECORD OF NICS OPERATIONS

    In the first 18 months of operation of the NICS, the NIC has proven 
to be a highly effective system, processing over 13 million inquiries. 
Most importantly, the FBI denied approximately 116,182 felons, 
fugitives, domestic violence abusers, and other prohibited persons from 
buying guns from licensed dealers. This equates to a denial rate of 
approximately 2 percent. Based on the information received from 
individual States and the Bureau of Justice Statistics, the FBI 
estimates that a total of approximately 290,000 denials have been made 
by the FBI and POC States under the permanent provisions of the Brady 
Act. See Chart, ``Denials by Category.''
    In addition to fulfilling its primary mission of stopping illegal 
gun purchase before they occur, NICS also assists law enforcement in 
apprehending fugitives. I would like to share with you two recent 
examples, from the 3,223 fugitives denied this far, of how NICS 
positively affects our nation's public safety in this area.
    On April 5, 2000, A NICS examiner pull a transaction out of the 
Texas delay queue. The examiner denied the transaction due to a felony 
conviction, and also questioned why the subject, who had a felony 
conviction in New Jersey, was attempting to purchase a handgun in 
Texas. The examiner checked the record of the subject and found that 
the individual was still on probation in New Jersey for a 1999 Arrest. 
The examiner contacted the Superior Court in New Jersey to inform them 
about the subject's attempt to purchase a firearm in Texas. On the next 
day, the examiner received a call from the Superior Court stating that 
a warrant message had been sent to the authorities in Texas to have the 
subject apprehended for violating parole. The examiner received a call 
from the Texas authorities indicating that the subject had been 
apprehended. The subject informed the police that his intentions were 
to kill his father in Texas and then go back to New Jersey and kill his 
mother and stepmother. The officer thanked the examiner for calling to 
check on the probation violation.
    On April 13, 2000, an examiner identified a warrant for a 
prospective firearm purchaser in North Carolina and contacted the 
issuing agency. The agency said that the individual trying to purchase 
the gun was the subject of a murder investigation for shooting a family 
member. The individual had previously assaulted a law enforcement 
officer, and was considered to be armed and dangerous. The examiner 
provided the address of the gun dealer, as well as the address of the 
subject, to the authorities. Officers were dispatched and arrested the 
felon. The captain thanked the examiner for her prompt attention to the 
matter.
    I would also like to share with you an example of how the work of 
our examiners furthers the Brady Act's goal of preventing gun violence 
in the context of domestic violence.
    On April 21, 2000, an examiner was investigating a disorderly 
conduct charge on a prospective guy buyer to see if it was related to 
domestic violence, and therefore meant that the person was prohibited 
from acquiring a gun. The Illinois authorities informed the examiner 
that the charge was based on the following facts: The individual had 
beaten his 21 year old wife, who was six months pregnant at the time, 
dragged her from room to room, pushed her to the floor and sat on her 
stomach. Based on this information, the individual's attempt to 
purchase a gun was denied.
                 system accuracy, security and privacy
    The FBI continues to work to build the volume and completeness of 
records in the NICS, appears to be quite high. The NICS has a very 
effective appeals system which allows individuals who wish to contest a 
denial to appeal the decision. Less than 1 percent of all checks 
conducted by the NICS operations center have resulted in denials that 
are subsequently reversed. These reversals effect only 3.3 percent of 
all denials by the NICS operations center and in about half of these 
reversals, the mistake was the result of information missing from the 
original record, not a NICS error.
    The FBI has taken a number of steps to ensure that the information 
in the system is secure from any unauthorized access. One of the 
primary ways that we are able to assure that the sensitive information 
in the NICS is not misused (for example, by firearms dealers who might 
use the NICS to do unauthorized background checks on persons who are 
not attempting to buy a firearm) is by conducting audits. We use 
information about checks that have been conducted to make those audits. 
We also use audits to assure that unscrupulous firearms dealers do not 
submit inaccurate information to the NICS in order to avoid the effect 
of a background check on a disqualified buyer. Currently, according to 
the regulations governing the NICS, after 180 days, the NICS 
automatically purges all records relating to a background check which 
results in an allowed transfer of a firearm. The records are retained 
for this brief period of time to give us some ability to audit the use 
and performance of the NICS.

                        WAYS TO IMPROVE THE NICS

    As the distinguished members of this committee are aware, the NICS 
program has received much publicity, interest, and oversight during its 
development and since it became operational. At the FBI, we 
continuously working to improve and perfect the NICS, so that it will 
be as efficient, thorough, convenient and reliable as possible. Today I 
would like to address a few key areas for improving the NICS: The issue 
of default proceeds, and the issue of system availability.

                     THE ISSUE OF DEFAULT PROCEEDS

    As currently written, the Brady law says that if the NICS does not 
provide a definitive response to the dealer within 3 business days of 
the time that the dealer provides the system with the information 
needed for a background check, the dealer is not prohibited from 
transferring the firearm. We refer to cases where the background check 
cannot be completed within the statutorily-allowed three business days 
as ``default proceeds.'' Default proceeds occur primarily due to lack 
of arrest dispositions in automated State criminal history records.
    A typical example of a NICS transactions leading to a default 
proceed involves a record showing a felony-related arrest, which is not 
a Brady disqualifer in and of itself, with no information to indicate 
whether the case was prosecuted and whether it resulted in a 
conviction. (Information demonstrating that the person was either under 
indictment, or had been convicted would create a Brady disqualifer.) In 
these instances, additional research is needed before the transaction 
can be approved or denied. The ability to obtain the required 
disposition information in a timely manner is directly affected by 
several factors, such as whether the court is open, the willingness of 
the court's staff to assist the FBI, and the accessibility of the 
disposition information. The FBI must rely on the cooperation of state 
and local agencies to obtain information needed to determine a 
purchaser's eligibility, making the resolution of delayed transactions 
within 3 business days often beyond the FBI's control.
    Over the past 18 months, there were over 180,000 default proceed 
transactions in which the FBI did not get information allowing an 
affirmative ``deny'' or ``proceed'' response within the 3 business days 
allowed by the Brady law. Of those 180,000 cases, the FBI is aware of 
6,084 individuals who were sold firearms after the 3 days expired and 
were later determined to be prohibited persons. (We refer to these as 
``delayed denials.'') We have no way of knowing how many more of the 
180,000 cases of default proceeds resulted in the transfer of a gun to 
a prohibited person, since in most of the cases there is never a 
definitive resolution of whether or not the subject of the arrest 
record was in fact a prohibited person before the record of the default 
proceed is destroyed.
    Delayed denials are a very significant cause for concern because 
they present public safety risks and place resource demands on law 
enforcement agencies, who must then go and retrieve the firearms. 
Fortunately, we do not believe that all default proceeds results in 
prohibited people getting guns, because some responsible gun dealers 
have adopted corporate policies to never sell a firearm without a 
``proceed'' response from the NICS, even if that response takes longer 
than 3 days.
    The problem of delayed denials and default proceeds has been 
documented fairly thoroughly by the General Accounting Office (GAO) in 
one of their reviews of the NICS. In their report, Gun Control: Options 
for Improving the Financial Instant Criminal Background Check System, 
(GAO/GGD/00-56) dated April, 2000, GAO outlined three initiatives to 
help address the problem of default proceeds. First, they discuss 
Federal grant funding to improve State criminal history records. 
Second, they discuss encouraging State participation in NICS. Third, 
they discuss amending the Brady Act's 3-business-day default proceed 
requirement. I would like to address each of these--all of which would 
help resolve the problem of default proceeds--very briefly, inasmuch as 
options to improve NICS and reduce the number of default proceed 
transactions and firearm retrievals may need to focus on legislative, 
rather than administrative reports.
    Continued funding to provide Federal grants to States for improving 
the quality and completeness of automated criminal history records in 
quite important. The funding provided to States under the National 
Criminal History Improvement Program (or ``NCHIP''), which is now 
funded as part of the Crime Identification Technology Act, totaled $273 
million during fiscal years 1995 through 1999. According to a recent 
analysis by the Department of Justice's Bureau of Justice Statistics, 
these funds have had a substantial impact: The number of records that 
include dispositions and are accessible to the NICS through III 
increased by almost 80 percent between 1993 and 1999. Because there is 
a very long way to go in assuring full and complete automation and 
accessibility, However, this option, while critical, will not resolve 
the problem of default proceeds.
    The FBI has always been a strong proponent of encouraging State 
participation in NICS, and the GAO report identifies financial factors 
discouraging State participation. The GAO report suggests that some 
form of Federal financial assistance would encourage State 
participation. Because States can have advantages over the FBI in 
conducting NICS background checks--such as access to additional data in 
their own State and the ability to better interpret their own criminal 
history records and firearm laws--increasing State participation in 
NICS could help improve NICS' effectiveness and reduce default proceed 
transactions. However, State participation would likely not eliminate 
the problem of default proceeds, because the lack of available 
disposition information would confront the States as well as the FBI.
    Amending the 3 business-day default proceed requirement of the 
Brady Act to treat differently those potential purchasers with 
disqualifying offense arrests having no disposition information would 
provide immediate relief for law enforcement from the problem of 
default proceeds. For example, the State of Colorado provides by State 
law that a firearm transfer can be denied on the basis of a 
disqualifying offense arrest alone, and the prospective purchaser is 
given the opportunity to challenge the denial by showing that the 
arrest did not lead to a conviction. The State of Washington deals with 
the problem by having a State law that allows up to 5 days to perform a 
background check. This law also says that if available records indicate 
that the prospective purchaser has an arrest for a potentially 
disqualifying offense, a hold for up to 30 days can be placed on the 
transaction's approval, pending the receipt of disposition information 
to verify the purchaser's eligibility to possess a firearm. The law 
also provides that an extension of the hold can be obtained if after 30 
days the disposition of the arrest still cannot be verified.

          SYSTEM AVAILABILITY AND EFFORTS TO MINIMIZE DOWNTIME

    In regards to the system outages experienced during the month of 
May, 2000, let me begin by saying that the FBI's goal is to minimize 
system downtime. The FBI recognizes the disruptive effect downtime can 
have on the business operations of gun dealers and the resulting 
inconvenience to prospective gun buyers. The FBI is working toward 
maximizing system availability during the normal operating hours of the 
NICS. However, the reality is that hardware and software problems will 
occur during the normal operation and maintenance of complex 
information systems.
    The overall record of the system's availability during its 
operating hours through May 2000 is just over 96 percent. See charts, 
``availability of databases comprising NICS'' and ``NICS 
availability.'' Historically, since the NICS began operation on 
November 30, 1998, system availability generally showed steady 
improvement over the first 7 months. By June 1999, the NICS was 
available over 99 percent of scheduled operating hours. However, 
beginning July 11, 1999, the FBI replaced two major computer systems, 
both of which interface with the NICS. One of the new systems, the NCIC 
2000, was implemented July 11, 1999. The integrated automated 
fingerprint identification system (IAFIS) was interfaced with NCIC 2000 
and NICS on July 28, 1999. Outages for NICS occurred during July and 
August due to the implementation of these two systems. By December 
1999, however, system availability was 95.32 percent of scheduled 
operating hours.
    The recent interstate identification index (III) outage occurring 
on May 11-14, 17, and 22, 2000, resulted in the loss of service to not 
only the NICS system, but to IAFIS and Federal, State, and local law 
enforcement agencies as well. Collectively, IAFIS, III, and NICS are 
referred to as a system of systems (SOS) and provide fingerprint 
identification capabilities, criminal history services, stolen property 
and wanted person checks, and background checks as required by the 
Brady Act. The SOS serves the public by facilitating police work and 
fostering police officer safety. It also ensures that retail firearms 
dealers do not sell guns to prohibited persons. Last month, the outages 
of the III databases, which contains 95 percent of the records checked 
by the NICS, ultimately caused the loss of service to NICS. This 
resulted in the inability to respond to inquiries from firearms 
dealers. The outages also precluded CJIS from meeting its IAFIS 
fingerprint customer service goals.
    Until May 11, the CJIS SOS experienced an outstanding record of 
reliability, with only those problems typical of new and complex 
information systems. Unscheduled downtime was very low, and from 
September, 1999 to April, 2000, the III segment of IAFIS had a service 
availability rate of 99.03 percent, processing an average of 263,432 
transactions daily.
    Preliminary root cause analysis of the May outages has ruled out 
operator-induced error, hacker-induced error, virus-induced error or a 
hardware-induced error. While the cause of the outages is still under 
review, all indications point to the root cause as a defect in the 
proprietary database management software which caused an incorrect and 
corrupting calculation of table spaces within III. Short-term risk 
reductions steps have been taken. Research and analysis to date has 
resulted in a short-term repair that is expected to reduce the 
likelihood of this problem recurring. These steps are expected to 
reduce the risk of future database corruption while a long-term repair 
is evaluated and implemented. Standard operating protocols exist to 
ensure service is restored as soon as possible, if an when an incident 
occurs. These protocols were followed during each of the outages.
    All these systems and segments function with a high degree of 
interdependence, relying upon complex interconnected indices and tables 
to operate properly and to ensure high confidence in information to 
users. An outage may occur as a result of a system failure within the 
NICS or when NICS 2000 or IAFIS cannot supply the services needed to 
perform a complete NICS check. The NICS is designed to check all three 
databases: The NCIC 2000, III, and the NICS index. If one of these 
databases is off-line or down, the NICS still searches the remaining 
active databases for 100 percent accuracy. Once the previously off-line 
database becomes available, the search is completed and the response is 
sent to the requester. However, the NICS is placed in an ``out of 
service'' period when any of these systems is unable to support a 
complete check. This policy, supported by the CJIS advisory policy 
board, significantly reduces the number of delay responses returned to 
gun dealers.
    Whenever an unscheduled outage occurs, the NICS program office 
works diligently to provide ample notification to POCs and licensed gun 
dealers. Per existing NICS policy, gun dealers are notified of an 
unscheduled outage by placing a message on the call centers' phone 
system. When an unscheduled outage occurs, the voice recognition unit 
informs the gun dealer that the system is temporarily out service. POC 
States are notified of an unscheduled outage by a message sent via NCIC 
2000. However, due to the extent of last month's outage, additional 
planning and pro-active measures were taken to help alleviate any 
effects felt. Some of the additional steps taken include:
    1. A notice was released to the public and faxed to 76 different 
POC State contacts including control terminal officers and various 
other NICS contacts to advise of the outage and the anticipated time of 
resumed service;
    2. Phone calls were placed to all POC and partial-POC States to 
advise of the same;
    3. Phone calls were placed to 1,364 gun dealers that were 
statistically shown to process large numbers of transactions to advise 
of the outage and anticipated time of resumed service. The normal 
outage message heard by other licensed gun dealers on the call center 
telephone system was modified to reflect pertinent information 
previously faxed to POC and other NICS contacts.
    4. Licensed gun dealers participating in the call center pilot 
project in the States of Rhode Island and Delaware were called and 
advised of the outage, anticipated resumed service, and information 
that it was a system-wide issue and not project-specific.
    The NICS program office also prepared measures for the quick 
completion of backlogged transactions. Additionally, NICS employees 
were on standby and used as needed for the increased delay queue 
transactions once the system became operational. This measure proved 
effective because the work in progress remained at a normal or below 
normal level throughout the first operational day. The call centers 
also provided extra staffing and overtime to their personnel to assist 
in the management of high volume incoming calls. The NICS program 
office recognized the fact that the call centers may have difficult to 
reach at times, therefore transactions were handled immediately for any 
gun dealers calling into the NICS customer service. Whenever NICS 
examiners were calling gun dealers to advise of a final status for 
delayed transactions, they also inquired of the dealer if there were 
any other transactions that they could handle immediately for them. 
Following the outage, POC States were provided additional processing 
time beyond the normal operating hours to facilitate the processing of 
batches of transactions that had been held by the States. This action 
provided the added benefit of reducing the processing load on the NICS 
system when the call centers and FBI operations were resumed.
    Measures are being looked into to minimize the risk of recurrence. 
The best route for immediate corrective action during a system outage 
is the definitive identification of the root cause and subsequent 
correction. This greatly reduces the risk of a similar event, but is no 
guarantee that another event with a different catalyst will never 
occur. Small-scale database failures are managed and corrected within 
the current system design with little or no impact to users. These 
events were within the design limits for the backup and recovery of the 
III database.
    If these efforts do not ensure the desired availability, it may be 
necessary to consider the more expensive, long-term solution of 
developing and installing a fully-redundant, identical III database. 
This option would require the acquisition of additional data storage 
hardware, commercial software, and development of data management 
software to maintain a full-time mirrored version of the III segment, 
and would entail a substantial initial budget outlay and recurring 
annual management costs. Further measures enhancing availability and 
recovery that would require such additional funding include redundancy 
of other CJIS databases and systems, such as NCIC 2000 and NICS, with 
the physical location of these redundant systems at alternative sites.

                OTHER PLANNED UPGRADES AND IMPROVEMENTS

    A total of $9 million was allocated to upgrade the NICS in fiscal 
year 2000. Of this amount, $6.5 million of fiscal year 2000 funding was 
dedicated for upgrades while $2.5 million of prior year carry forward 
funding is being dedicated to the development of a NICS improvement: 
Electronic access to NICS for firearms dealers. Some of the planned 
system upgrades include:

   The purchase and installation of commercial off-the-shelf 
        software upgrades. These are known in the industry as ``COTS'' 
        software upgrades and are routine with any operating system. 
        This is an ongoing enhancement for fiscal year 2000 and 2001.
   Because NCIC 2000 accesses III via the IAFIS when conducting 
        a search, a bypass is under development which will allow the 
        NICS to continue running when the identification tasking and 
        networking (ITN) segment of the IAFIS is down or experiencing 
        difficulties. Expected completion date for this project is fall 
        of 2000.
   Two additional production servers will be installed to 
        handle the expected 20 percent increase in volume during 
        seasonal peak time--September through December. Installation is 
        expected in fiscal year 2000.
   The development and testing of an interface for the NICS 
        direct electronic access by firearms dealers to initiate a NICS 
        search. Development for this interface will continue throughout 
        fiscal year 2000.
   The implementation of new filtering rules which will allow 
        NICS to eliminate many of the false positives returned, 
        consequently providing more immediate proceeds, before 
        providing the search response to the FBI and State users. 
        Testing and implementation are expected to be completed in 
        fiscal year 2000.

    Currently, there are approximately 60 other enhancement or software 
changes that have been identified and prioritized by the NICS program 
office and are expected to be implemented in fiscal year 2000 and 2001. 
The FBI's deputy assistant director for operations in the CJIS division 
and the appropriate system managers have the final decision as to when 
to apply system upgrades or modifications. Keeping gun dealers and our 
partners in law enforcement in mind, routine maintenance is always 
scheduled during non-operational hours--1 a.m. until 8 a.m. eastern 
time.
    As I previously stated, NICS interfaces with both NICI 2000 and the 
IAFIS. Upgrades and enhancements for these system are always scheduled 
during periods which provide the least impact to law enforcement 
agencies nationwide. Most of the upgrades and enhancements are 
scheduled during the least used period, primarily early Sunday 
mornings, and have no impact upon NICS' operations. However, there have 
been cases when additional time to required and the NICS can be 
affected. Naturally, during such non-scheduled interruptions in service 
to NCIC 2000 and IAFIS, the FBI's priority is to restore law 
enforcement functions first, prior to the restoration of NICS services.
    Electronic access is alluded to in both the Brady Act and Federal 
Register, which say that ``The NICS shall allow federally licensed gun 
dealers to contact the system by telephone, or other electronic means 
in addition to the telephone, in order to contact the system.'' Gun 
dealers with electronic dial-up access will be able to contact the 
NICS, excluding scheduled and unscheduled downtime. A survey was used 
to determine which method of electronic access would accommodate most 
licensed gun dealers in the most cost-effective manner. Cost 
comparisons were performed on the development and logistics to operate 
and maintain a PC-based software solution using secure dedicated 
communications or a secure internet solution via COTS software.
    A secure Internet solution seemed to be the most technically 
feasible and effective solution for developmental, operation, and 
maintenance costs and for providing gun dealers with the necessary form 
of electronic access. The FBI, therefore, plans to establish a NICS 
background check secure web-site on the Internet. Access to the web-
site will be limited to federally licensed gun dealers. The development 
process regarding electronic access started in February 2000, with an 
implementation date for the initial capability scheduled for January 
2001.
    The FBI has continued to seek and act upon the advice of local and 
State law enforcement in its operation of NICS. Proven mechanisms are 
in place for the continued improvement of NICS operations. For example, 
regional and national meetings are held semi-annually in which the FBI 
provides status reports on the NICS to local, State, and Federal 
advisory groups and receives recommendations for NICS system and 
operational enhancements. In addition, the FBI's NICS Program Office 
has hosted several NICS State participant conferences, with the most 
recent held on May 31-June 1, 2000 in Pittsburgh, Pennsylvania. Another 
conference will be held this summer for all licensed gun dealers. The 
NICS Program Office has also invited to the summer conference members 
of the congressional staffs and representatives from the gun industry. 
The FBI will present informative briefings and hopefully receive 
constructive feedback on the NICS operation to date. Finally, the FBI 
incorporated NICS information into its law enforcement online, or LEO 
Program, and, in conjunction with the Department of Justice, 
established the NICS web site to ensure the Rapid, continued 
dissemination of important new information about the NICS.

                               CONCLUSION

    As I conclude my opening statement, I again thank the Chairman and 
the members of the Senate Judiciary Committee for providing me with the 
opportunity to speak to you today about the NICS Program. At this time, 
I am available to answer any questions the committee may have.

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    The Chairman. Captain Smith, we are happy to welcome you 
from my home State of Utah and we are just anxious to hear what 
you have to say, especially since Utah is a point of check 
State.

                   STATEMENT OF STUART SMITH

    Captain Smith. It is. It is a point of contact State, Mr. 
Chairman, and greetings from home. It is a great day in Salt 
Lake, by the way.
    The Chairman. It was great last weekend while it rained 
here the whole time.
    Captain Smith. That is true. A few comments on Utah, and 
maybe that helps with background, Senator. Utah is a full 
point-of-contact State, like you pointed out. Utah clears all 
firearms sales through the Brady background check center at the 
State before they go from dealer to buyer. This is done 7 days 
a week and it is done without a waiting period. Utah 
transferred a little over 90,000 firearms last year.
    The Chairman. Let me interrupt you. When you say, without a 
waiting period, when you find these problems that come up, do 
you resolve them within, what, a couple of hours?
    Captain Smith. Well, again, to answer that question, we 
have an immediate proceed rate that is a little bit higher than 
the Federal average. It waivers around about 76 percent. That 
is due to a few factors that Mr. Loesch talked about. Our 
operators that take those calls and deal with those records 
have all the information in front of them immediately. The FBI 
is working on a system to do that same thing nationally, but we 
are able to make a few more determinations immediately because 
of that.
    The other ones, what is left, has to go out to be 
researched, and you have alluded to that with other testimony 
from the two Senators previously, and that is that there are 
incomplete records out there. Some of those may be State 
records in our State. Some of them may be State records in 
another State.
    So we are saddled with the same situation the FBI is, that 
if you have a record out of another State and it is out of a 
local court, you are going to have to call them, search that 
record out, and there are some interesting anecdotal stories 
that go with what some of those courts have to say when we call 
them up. Occasionally it is, send us a $20 check and we will 
mail that back to you. So an immediate proceed, obviously, is a 
little bit tough when they will not even tell you over the 
phone what the disposition of a particular arrest is.
    The Chairman. Well, thank you. Sorry to interrupt you.
    Captain Smith. It is disappointing, but that is a fact of 
life and I think automation is probably the answer to most of 
those issues.
    Utah has a denial rate of about 2.78 percent. As I 
understand, it has risen to about 2.9 percent. That, I think, 
compares to a NICS rate, I believe that is 1.76 percent. So we 
deny a little bit more, and that is understandable, being now 
that we are looking at a more complete record, and there is 
also a layer of State laws that lay over the top of the Brady 
laws nationally that we deny on in Utah.
    Utah charges a $7.50 fee for a Brady background check. Of 
course, the NICS does that without cost to a dealer and that is 
certainly a bone of contention in Utah with the dealers there 
and the persons that purchase firearms. But that runs our State 
center. I will talk a minute later about wanting to see a 
little bit more money come back possibly from Congress to us 
about that.
    Utah's population is about 2.1 million. We have a little 
over 30,000 concealed carry weapons permits there. That is a 
significant number those folks are pre-authorized under State 
law and in compliance with Brady to go ahead and waive a 
background check in Utah, which is an absolute immediate 
proceed.
    Utah, with a valid CCW, like I say, you do waive that and 
that speeds up that process and I think probably raises our 
percentage of immediate proceeds, at least as it relates to 
most gun transactions there. Those CCW permits also allow 
people to do a few other things in Utah because it is looked at 
as such a high level of background.
    Utah's view of the NICS is the NICS can improve. The NICS's 
reliance on other CJIS systems has been problematic, that one 
system being offline causes the whole process to stop. Again, 
Assistant Director Loesch talked about that and what they are 
trying to do to improve that and we support that effort of 
improvement. Redundancy and higher reliability of programming 
might be an answer to that issue.
    The question, I think, is where we go from here. Most agree 
that the States have better records, probably have better 
access to those records and are able to deal with the local 
entities, both courts and law enforcement that possess those 
records and able to get immediate proceeds and actually 
research done. The FBI's immediate proceed rate, I think, was 
about 71, 72 percent. Again, I said Utah's is about 76 percent, 
which bears out, I think, a more complete record at the State 
level.
    Federal funding assistance to point-of-contact States is 
obviously an issue that Utah, as well as the other 15 point-of-
contact States, are more than a little interested in. You 
mentioned the NCHIP program before. Utah does utilize the 
National Criminal History Improvement Program, does use those 
funds in a number of areas. I think one of our biggest 
challenges with NCHIP funds is where to spend a small amount of 
money and get the biggest bang for it. Certainly you have heard 
testimony today, and I would support that, that automation of 
court records has got to be a priority.
    We have seen NCHIP funds spent in a lot of areas. I will 
tell you right now in Utah, Senator, that we spend some of that 
money right in our NICS call center, State call center to NICS, 
to make sure that if there is a Utah record that comes back 
that is incomplete, that we research it immediately, close that 
record, and use that funding to pay for that to make sure that 
that is upgraded and that information is available to all law 
enforcement and criminal justice.
    Utah and other point-of-contact States need support of 
Federal dollars to continue functioning in the area of Brady 
firearms checks. The FBI has said the cost of the NICS check is 
about $14, I believe, and you can see Utah charges $7.50. We 
are quite a bargain out West, I think, and stretching that 
dollar. But we would sure like to see some Federal dollars come 
back to us.
    It was not long ago, I think last year, correct me, Mr. 
Loesch, we had about 23 point-of-contact States, full point-of-
contact States. We are down to 15 as of this morning, my last 
check, and I guess that is a little bit disappointing. I think 
certainly at the Federal level and certain here that States are 
getting out of the business. There are a lot of reasons for 
that. Funding has got to be at the top of the list.
    Congress has funded the NICS. It has ignored the POC States 
that have stepped up to the challenge and accepted the 
responsibility of State records and the willingness to fully 
utilize those records in a Brady process. Utah would like to 
see some equity come to this process and have a fair portion of 
funding come back to support our State and run the program that 
is mandated under Federal law and Brady.
    Utah's plan to improve in the future includes a number of 
things. We look at certainly automation as part of it. You look 
at that 76 percent immediate proceed rate. It is very high, and 
we think it can go higher. We would like to see that go higher. 
There is a lot of technology out there shared between States, 
both in this program and other backgrounding programs, that 
tend to indicate that point-of-sale devices, similar to Visa 
machines that have been discussed before and credit card type 
of applications, could have a point-of-sale device for a dealer 
to access that database and go right straight forward.
    We are also experimenting on some things on the Internet, 
that that could be filled out and handled immediately through a 
system. And there is no reason not to do that, Senator. I think 
with the immediate proceed, it should come back, be able to 
enter it and come right back to that dealer immediately.
    I think cost certainly is a factor. We think that will 
level out cost and maybe those savings can be reinvested into 
improvement of the program over time. Certainly, we do some 
things at gun shows that are pretty attractive. We have asked 
our gun show dealers not to allow private sales at the gun 
shows and that is, of course, up to them, but they have pretty 
much complied with that. In return, we have set up fax 
processing for them at a gun show that has been very effective 
and we have gotten tremendous support from those gun dealers to 
see that the business is done that way and it has cut 
turnaround times dramatically.
    Senator Hatch, I have prepared a statement for the 
committee. That is on record, and I would ask that you accept 
that as my statement and I would be glad to answer any 
questions that you have or the committee has.
    The Chairman. Thank you, Captain Smith. Without objection, 
we will put your full statement in the record and all full 
statements in the record. We are real happy to have you here 
and we are very proud of what you are doing out there in Utah, 
working with the FBI and others. We are, frankly, happy to have 
this testimony.
    Captain Smith. Thank you.
    [The prepared statement of Captain Smith follows:]

                Prepared Statement of Captain Stu Smith

    Senator Hatch and members of the Senate Judiciary Committee, thank 
you for inviting me to comment and give testimony on the National 
Instant Check (NICS) firearms transfer system.
    My comment will cover:
   The State of Utah's view of the NICS.
   Federal funding assistance for POC states.
   Utah's plans to provide better service to firearms dealers 
        and customers.

                               UTAH FACTS

   Utah is a full point of contact state (POC) for firearm 
        transfers under Brady.
   In Utah all firearm sales are cleared through the state 
        backgrounding center prior to any transfer from dealer to 
        buyer. This is done seven days a week, without a waiting 
        period.
   Utah transferred a little over 90,000 firearms last year. 
        That number will be higher this year. Utah has a denial rate of 
        2.78 percent compared to a NICS rate of 1.76 percent.
   Utah charges a fee $7.50 fee for a ``Brady Background 
        Check.'' The background check and the fee are a function of 
        state law.
   Utah has a population of approximately 2.1 million and has 
        over 30,000 Concealed Carry Weapon (CCW) permit holders.
   In Utah a valid Utah CCW waives the need for a Brady 
        background check prior to a firearms transfer.
                  the state of utah's view of the nics
   The NICS can improve. The NICS reliance on other CJIS 
        systems has been problematic in that one system being offline 
        causes the whole process to stop.
   Redundancy and higher reliability of the programming would 
        help this issue.
   The question is where do we go from here? Most agree that 
        the state have more complete information and records. The 
        states have the ability to do a better job of backgrounding 
        persons prior to firearms transfers, but the states lack the 
        funding and now the incentive to take on this type of tasking.
   The FBI has an immediate proceed rate of 71 percent. 
        Transactions that go through without any problems can be 
        automated. Transactions that hit on a possible record need to 
        be reviewed by a training operator that can look at all the 
        information available. When operators look at a all available 
        information the immediate proceed rate goes up. More difficult 
        research issues still require phone contact with court clerks 
        and police agencies at the state and local level. Court record 
        are often still non automated, and are subject to local rules 
        of access.
               federal funding assistance for poc states
   Utah utilizes National Criminal History Improvement Program 
        (NCHIP) grant funds to research and close any open or incorrect 
        Utah criminal history records.
   Utah and other POC states need the support of federal 
        dollars to continue functioning in the area of Brady firearms 
        background checks.
   The FBI has said the cost of an NICS check is about $14. In 
        Utah we charge $7.50 for that same service. That local cost 
        does not include the infrastructure costs of the NICS, which is 
        still a required step in the backgrounding process and must 
        have funding to continue. It was not too long ago that there 
        were 23 POC states, as of this morning there were 15 POC 
        states. That has occurred in the face of knowing the state 
        could do a better job of local record checks.
   Congress has funded the NICS, but has ignore the POC states 
        that have stepped up to the challenge and accepted the 
        responsibility of state records and the willingness to fully 
        utilize those records in the Brady process. Utah would like to 
        see some equity come to this process and have a fair portion of 
        funding come back to support our state run program under the 
        federal mandate of Brady.
utah's plan to provide better service to firearms dealers and customers
   State law in Utah are somewhat more restrictive than the 
        national model. That additional level of records and law result 
        in a higher rate of denials. Utah's ability to access more 
        records at the local level and do it more quickly and more 
        comprehensively keep approval times down, but quality of the 
        product high.
   The future of the backgrounding of firearms transfer in Utah 
        is directed toward faster service, higher quality and no 
        increases in cost. We intent to accomplish this through point 
        of sale device. For those dealers that have Internet access we 
        are creating a web enabled background checks process that will 
        provide instant approval on searches that do not hit against 
        criminal records.
   Utah now provides a FAX service to those dealers that are 
        not in a hurry and want to operate on extended hours. These 
        requests are received around the clock. Overnight requests are 
        cleared in the morning. Requests received during Brady business 
        hours are processed when they are received.
   Utah has an immediate proceed rate of 76 percent. With this 
        percentage rate we feel that technology and automation of the 
        process, starting at the point of sale, is the long range 
        answer to faster customer service, low cost, and a positive 
        impact on local businesses operators. Some states are doing 
        this in the area of firearm transfer and other types of 
        background checks. The technology exists and is viable for this 
        type of application.

    Thank you for your interest in the view of the states. I will be 
happy to answer any questions you may have.

    The Chairman. I am going to skip over you, Mr. Schlueter, 
because I think Senator Leahy would like to be here, as well, 
and he should be here in another 10 minutes, so we will go to 
Ms. Ball first and then we will finish with you. We are happy 
to welcome you to the committee.

                    STATEMENT OF ROBIN BALL

    Ms. Ball. Thank you. It is nice to be here this morning. My 
name is Robin Ball. I own Sharp Shooting Indoor Range and Gun 
Shop in Spokane, WA. My business opened 5 years ago and we have 
been doing background checks since that time at the State level 
and at the NICS level when NICS went into service. In addition 
to the shooting range, we provide training for several shooting 
disciplines, including law enforcement, hunter education, 
personal defense, armed security, and junior pistol safety. We 
have a large retail facility where we are federally licensed 
dealers in handguns, rifles, shotguns, and accessories.
    I also want to mention that Washington State is a partial 
point-of-contact State. We process handguns through the State 
system and long guns and shotguns through the Federal system. 
All of our firearm sales are subject to background checks.
    One comment that was made earlier was regarding Internet 
transfer and sales. The transfers that take place across the 
Internet have to go through the State system. A firearm cannot 
be shipped unless it is shipped to a licensed dealer. I have 
not seen any problems with Internet sales at all, other than we 
see an increase in paperwork, yet we are not the ones selling 
the product. Most dealers, you will find, charge a handling fee 
to run the background paperwork. Guns are not going through the 
Postal Service without going to a dealer.
    I am a certified instructor for home safety, personal 
protection, and Refuse to Be a Victim, and the Refuse to Be a 
Victim Program is an NRA safety class that is not firearms 
related. In addition to the classes that I teach at my 
business, I also teach the Refuse to Be a Victim Program at a 
couple of our local community colleges, as well as high schools 
in our area. I am a member of the National Rifle Association 
and an executive committee member for National Shooting Sports 
Foundation's range development program. In addition to NRA and 
National Shooting Sports, I am a spokesperson for Second 
Amendment Sisters.
    Today, I am not here on behalf of any of those 
organizations. I am here to talk about how the NICS system, the 
National Instant Criminal Background Check System, affects 
those of us who are licensed to deal in firearms and how it 
affects our customers. Through my business and volunteer 
contacts, I keep in touch with dealers not just in my area but 
across the country, and again, as I mentioned, some of the 
transfer that I handle come in from other States and they are 
from licensed dealers who we keep files of their licenses.
    From my personal experience in running my business, I have 
contacts in a lot of locations and I can truthfully say I 
understand the serious frustration that dealers face and law-
abiding citizens who get delayed are feeling about the NICS 
program. Delays, outages, numerous recorded messages have a 
very negative impact on the process of doing business. 
Customers know the system is supposed to be instant. We have 
coined the phrase ``the not-so-instant background check 
system.'' Customers do not understand why they get delayed.
    I do not include information regarding denied transactions 
because we have seen only one denied transaction in the course 
of doing business since NICS went into operation. If we are a 
typical dealer, then the numbers on attempted transfers to 
felons are being terribly inflated.
    Outages shut down the legal commerce of my business. 
Customer service is very important to us, and we look 
incompetent when the Federal system does not work the way it 
was intended. It is not uncommon for a customer to cancel a 
sale and leave the building because we cannot get a transfer to 
take place. Though we are not responsible, the blame rests with 
us in the eyes of the customer. We send an angry customer away 
who cannot complete a transfer, not because of being ineligible 
to own a gun but because the government system is incomplete or 
unreliable. My best advertising is word of mouth. This does not 
leave a good impression for my business.
    We have been told by NICS customer service staff that the 
delays are often a result that the computer does not have the 
needed information. In private enterprise, this is not 
tolerated. If the system is broken, you fix it or your business 
fails.
    The failure of NICS to do the job it is supposed to do 
appears to be getting worse instead of better. Dealers expected 
problems in the beginning. You are going to have problems any 
time you have a new system, and I believe that most dealers 
were pretty patient. In the beginning, we had fewer delays and 
fewer total shutdowns of the system. Certainly nothing in the 
early months of the NICS operation compares to the terrible 
delays and shutdowns we have seen recently.
    The cost to my business is difficult to measure. We 
experience lost sales because purchasers are frustrated. They 
do not want to wait for NICS to function again, we cannot tell 
them when NICS will be up again, or they live out of the city 
in a rural area and they have come to Spokane for a day 
expecting that they can take transfer of a firearm and many of 
them will leave and not do that. Many feel it is better to wait 
until the system is back up and running than to start that 
process and have to make another trip back to Spokane to pick 
up their purchase when it has cleared. Outages make us look bad 
and they frustrate customers, and that frustration gets shared 
with their friends.
    One of the biggest frustrations that we experience is when 
a customer already has a carry permit for the State of 
Washington. With that permit process, they have been through 
the Federal background check system. Yet we have a duplication 
of processing where we have to still, even with a carry permit, 
call the information in to the NICS system. If NICS is not up 
to date and competent with the Washington State system, we get 
a delay. Certain carry permits, depending on their expiration 
date, do not require us to call NICS, but it is a very narrow 
window. People who have been through the background check 
system and have a license to carry and are probably already gun 
owners do not understand why they get caught in the fray when 
NICS breaks down.
    I do not have a logical explanation to give customers. I do 
have a customer who served this country in the military. He was 
honorably discharged and is a responsible parent who has taught 
his son gun safety and has a carry permit. He has purchased 
several guns from us since the NICS system was implemented and 
he gets delayed every time, telling us that the system is not 
up to date.
    Another really important area that we need to look at in 
this process is the area of self defense. I work with domestic 
violence issues all the time. I have women with restraining 
orders against violent ex-husbands or ex-boyfriends who have 
reached the breaking point. They do not want to die and they 
have only one choice, to defend their lives or the lives of 
their children. When NICS is out of service, we are left with 
no option but to tell this person whose life has been 
threatened, sorry, we do not know when NICS will be working 
again, or come back in 3 days in the case of delays. The common 
response is, ``I might be dead by then.''
    You read the papers and see the news and you know these 
issues exist in every part of our country. The only way to 
level the playing field for a woman who is threatened by a man 
is to learn to defend themselves. If a woman chooses to do so 
with a firearm, she should not be put in danger by computer 
failure or bureaucratic mixup.
    Last Saturday, and this has happened numerous times, last 
Saturday, I taught a class, and normally, I do not allow young 
kids to sit in on my classes, but a woman came in with a 
daughter who is 8 years old and I let her stay. At the end of 
this class, I was talking to her mom and the little girl was 
right there listening to this whole conversation. Her mom told 
me she wanted to learn what her options were for self defense 
because her ex-husband is being released from jail at the end 
of the month and he has made threats to kill her and her 
daughter. These threats have been reported, but nothing can be 
done until such time as he harms her.
    She told me that she thought about moving, but her daughter 
is so happy in her school that she has put that decision off. 
Her daughter spoke up and said, ``I do not mind moving, Mommy. 
I do not want you to get hurt.'' The mom asked me how long it 
would take to buy a gun and I told her she had better plan in 
advance because there is no guarantee that we can get the 
background check processed in less than a week. She was hoping 
to wait until payday. Here is a classic case of a parent trying 
to do the right thing under difficult circumstances.
    Most dealers do not have a problem with background checks. 
No one wants to keep guns out of the wrong hands more than gun 
owners do. After all, the press and many politicians go after 
us, the law-abiding and the hard-working gun owners and 
firearms businesses, whenever a crime occurs. It seems 
illogical to me to chastise businesses like mine instead of the 
criminals.
    Clean up the system and the government stands to gain a 
lot--confidence among businesses and dealers like myself that 
the system works, confidence among gun owners that the FBI is 
not retaining records on customers. I do not buy into 
conspiracy theories, but if a government program like NICS 
works as designed, there should be less distrust of the 
government and its programs in general.
    It seems to me that it is in the best interest of any 
elected official at the Federal level to make sure the 
government operations that you mandate work properly. Customers 
may blame the dealer because we are the closest people to yell 
at, but the responsibility lies with the government. The lack 
of determination that we have seen to fix these problems only 
increases that distrust.
    Thank you very much for your interest in this subject 
today. Thank you for letting me be here.
    The Chairman. Thank you, Ms. Ball.
    [The prepared statement of Ms. Ball follows:]

                    Prepared Statement of Robin Ball

    Mr. Chairman and Members of the Committee:
    My name is Robin Ball. I own a large indoor shooting range in 
Spokane, Washington. My business opened five years ago next month. In 
addition to the shooting range, we provide training for several 
shooting disciplines including hunter education, personal defense, 
armed security, law enforcement, and junior pistol safety. We have a 
large retail facility where we are federally licensed dealers in 
handguns, rifles, shotguns and accessories. All of our firearms sales 
ares subject to background checks; checks on rifles and shotguns are 
conducted through the FBI, while checks on handguns are conducted 
through both the FBI and the Spokane Police Department.
    I am a certified instructor for home safety, personal protection, 
and Refuse to be a Victim, an NRA safety class that is not firearms 
related. In addition to the classes at my business, I teach Refuse to 
be a Victim, at our local community college and several area high 
schools. I am a member of the National Rifle Association and an 
executive committee member for the National Shooting Sports 
Foundation's range development program. In addition to the NRA and 
National Shooting Sports Foundation, I am a spokesperson for Second 
Amendment Sisters.
    Today, I am not speaking for any of those organizations; I am here 
to describe how the problems in the National Instant Criminal 
Background Check System (NICS) affect those of us licensed to deal in 
firearms, and our customers. Through my business and volunteer 
contacts, I do keep in touch with dealers not only in my area but in 
all part of the country.
    From personal experience in running my business and in the contacts 
I have in other locations, I can truthfully say, I understand the 
serious frustrations licensed dealers and law-abiding citizens are 
feeling about the NICS program. Delays, outages, and recorded messages 
have a very negative impact on the process of doing business. Customers 
know the system is supposed to be instant and can't understand why they 
get delayed. I don't want to include any information regarding denied 
transactions because we have only seen one denied transaction since 
NICS has been in operation. If we are a typical dealer then numbers on 
attempted transfers to felons are being terribly inflated.
    Outages shut down the legal commerce my business is licensed to do. 
Customer service is very important to us and we look incompetent when 
the federal system does not work the way it was intended. It is not 
uncommon for a customer to cancel the purchase and leave. Though we are 
not responsible, the blame rests with the dealer. We send an angry 
customer away who can't complete a transfer, not because of being 
ineligible to own a gun but because the government's system is 
incomplete or unreliable. My best advertising is word of mouth and this 
does not leave a good impression.
    We have been told by NICS customer service staff that delays are 
often a result of the computer not having the information needed. In 
private enterprise, this is not tolerated. If the system is broken, you 
fix it or your business fails.
    The failure of NICS to do the job it is supposed to do appears to 
be getting worse instead of better. Dealers expected problems in the 
beginning, because of the start up of the new system. I believe most 
dealers were pretty patient. In the beginning, we had fewer delays, and 
fewer total shut downs of the system. Certainly nothing in the early 
months of operation of NICS compares to the terrible delays we have 
experienced recently.
    The cost to my business is difficult to measure. We have 
experienced lost sales because purchasers are frustrated and don't want 
to wait for NICS to function again, or they live out of the city in a 
rural area and have come to Spokane for a day of shopping. Many feel it 
is better to wait when the system malfunctions than to continue the 
process and come back to Spokane to pick their purchase up after we 
have cleared it. Outages make us look bad and frustrated customers will 
share that with their friends.
    One of the biggest frustrations that we experience is when a 
customer already has a concealed carry permit for the state of 
Washington, and still gets delayed because the information in NICS is 
not up to date. Washington is a point of contact state. Certain carry 
permits, depending on their expiration dates, do not require us to call 
NICS. But people who have a permit have all been through a background 
check and don't understand why they get caught in the fray when NICS 
breaks down. I don't have a logical explanation to give the customers. 
I have a customer who has served this country in the military, was 
honorably discharged, is a responsible parent who has taught his son 
gun safety, and has a carry permit. He has purchased several guns from 
us since the NICS system was implemented and gets delayed every time 
because the FBI has yet to update information in the NICS database.
    One area that cannot be overlooked is the self-defense issue. I 
work with domestic violence issues all the time. I have women with 
restraining orders against violent ex-husbands or ex-boyfriends who 
have reached their breaking point. They don't want to die and have only 
one choice--to defend their lives and the lives of their children. When 
NICS is out of service, we are left with no option but to tell this 
person whose life has been threatened, ``Sorry, we don't know when NICS 
will be working again,'' or ``Come back in three days.'' The common 
response is ``I might be dead by then.'' You read the papers and see 
the news, you know these issues exist in every part of our country. The 
only way to level the playing field, for a woman, who is threatened by 
a man, is to learn to defend themselves, and if a woman chooses to do 
so with a firearm, she shouldn't be put in danger by a computer failure 
or a bureaucratic mixup.
    Saturday, I taught a class. Normally I don't allow young children 
to sit in my handgun classes but a woman came in with an eight year old 
girl. My instinct told me to let her be. This little girl sat quietly 
and colored through the entire class. At the end of the class, I was 
talking with her mom, the little girl was right there, and her mom told 
me that she wanted to learn what her options were because her ex-
husband is getting released from jail at the end of the month and he 
has threatened to kill her and her daughter. The threats have been 
reported but there is nothing that can be done until such time as he 
harms her. She told me she has thought about moving but her daughter 
loves her school so much she has put that decision off. Her daughter 
spoke up and said, ``I don't mind moving Mommy, I don't want you to get 
hurt.'' The mom asked me how long it would take to buy a gun. I had to 
tell her, she better plan ahead, because there are no guarantees we can 
get a background check processed in less than a week. She was hoping to 
wait until payday. Here is a classic case of a parent trying to do the 
right thing under very difficult circumstances.
    Most dealers do not have a problem with background checks. No one 
wants to keep guns out of the wrong hands more than gun owners. After 
all, the press and many politicians go after us, the law-abiding, hard 
working gun owners and firearms businesses, whenever a crime occurs. 
Somehow, it seems illogical to me to chastise businesses like mine 
instead of the criminal. Clean up the system and the government stands 
to gain a lot: confidence among dealers that the system works, and 
confidence among gun owners that the FBI isn't retaining records on 
customers.
    I don't buy into conspiracy theories, but if a government program 
like NICS works as designed, there should be less distrust of the 
government and its programs in general. It seems to me that it is in 
the best interest of any elected official at the federal level to make 
sure the government operations that you mandate work properly. 
Customers may blame the dealer because we are the closest people to 
yell at, but the responsibility lies with the government and the lack 
of determination to fix these problems only increases that distrust.
    Thank you very much for your interest in improving this system, and 
thank you for inviting me to testify today.

    The Chairman. I think we will just give a little more time 
before we take your testimony, Mr. Schlueter, for the Senator 
to get here. Let me just ask a question of my fellow Utahan.
    Studies show that States like Utah and Vermont that act as 
points of contact for NICS do a better job of conducting 
background checks than the FBI. Naturally, States have better 
access to State court record and often are better at 
understanding some of the local firearms laws. In addition, 
some of them have access to certain sensitive records like 
mental health records and drug records that by law cannot be 
shared with the Federal Government or other States.
    But all of this, as you have pointed out, costs our 
respective States money. I would like to find a way, really, to 
encourage more States to become full participants in the NICS 
system, perhaps through grants or other incentives. Do you have 
any ideas on how to structure such a program? Senator Leahy and 
I are cosponsoring legislation that will help compensate point-
of-contact States, but what do you think of that idea?
    Captain Smith. Senator, there are a few things out there 
that probably fall down a line or a progression that need to be 
done. Certainly, some of those things have been mentioned 
today.
    Definitions are a big thing, believe it or not. When you 
say a mentally incompetent person, that has been one thing that 
the FBI and the States have really struggled about what was 
meant. What was the legislative intent behind that? And as you 
define that, things fall into or outside those parameters. 
Mental health records in Utah fall into a number of different 
governmental agencies, where they even fall into governmental 
agencies at all. Getting those records into a system, 
automating it so it actually is accessible is the challenge. 
Right now, Utah law changed this last legislative session and 
had juvenile records added to that.
    Again, automation becomes the issue. Can the State or even 
the Federal Government supply enough money or incentive to have 
those records electronically automated and then transferred 
under appropriate rule to law enforcement, in this case, to 
make them available for screening for background checks? 
Certainly incentives for those things are your answer.
    The Chairman. Let me see what we can do about that.
    Mr. Loesch, let me ask you a series of questions because 
the purpose of this is to just get a handle on what is best 
here. On outages, the FBI instructed its computer system 
contractors that the NICS system should be available at least 
98 percent of the time during operating hours. The NICS system, 
however, has failed to meet this performance specification in 
two-thirds of the months since it began running in November 
1998, and in spite of what many would think is a pretty 
sterling record anyway. According to the GAO, the NICS system 
was unavailable for a total of 215.5 hours during its first 
year, and every minute of that time was, of course, costly and 
extremely frustrating.
    These outages are not the inevitable result of reliance 
upon computers. Everybody that uses a credit card can tell you 
that computers are capable of instant credit approvals by the 
millions without long outages. Why is it that the NICS 
computers have such an abnormal number and duration of outages?
    Mr. Loesch. Part of it is this system of systems that we 
have got, Senator. There are so many different bundles of 
software involved. Actually, in the system of systems, over 400 
different bundles of software that are all integrated, and 
every time you get an upgrade from any of these companies, you 
have got to do a lot of reengineering to make sure that they 
fit.
    We have had a tremendous 32 years of reliability in NCIC, 
but it is a lot simpler type of system, basically, in what it 
does. It is almost like the credit card type of system. You 
query it and you get an answer back and it is a large database, 
but this III database, which is working through the ITN, and, I 
mean, we have got some corruption, and by that in the table 
spaces that the contractor is basically----
    The Chairman. By corruption, you mean inability to get 
things----
    Mr. Loesch. Actually, what happens is--they call it 
corruption. There is no kind of outside intervention or 
anything like that, that we have been hacked into or anything 
like that.
    The Chairman. You might want to use a different word when 
talking about the FBI systems. [Laughter.]
    Mr. Loesch. It is some kind of bug or something inside 
their database that just took--you know, it was running all 
these months perfectly and all of a sudden the right number of 
situations just hit this table and created that problem. We 
found that and we are trying to correct that now, but the 
system is very complicated and very, very sophisticated and 
very complicated. I am not an expert in computers, but, I mean, 
we have got literally dozens and dozens of the biggest 
companies in the world, basically, working on these problems, 
that built this system to specifications that have been laid 
out. We are going to get there. We are definitely going to get 
there. It is a matter of tweaking and continuing to do what we 
are doing.
    The Chairman. It is critical that we do.
    Let us turn to Mr. Schlueter now. We welcome you, we are 
happy to have you here, and we will be interested in your 
experiences there in Vermont.
    Senator Leahy. Mr. Chairman, I might emphasize, in Vermont, 
we feel very fortunate that Max is there. In a little State 
like ours, it is extremely important that we have the abilities 
that he brings there and the fact that, as you know from Utah 
and Vermont and everywhere else, there is no State today that 
does not face a number of these problems and he is very 
helpful. I thank you for putting him on the list of witnesses 
today.
    The Chairman. We are happy and honored to have you here, 
Mr. Schlueter. We will turn to you at this time.

                   STATEMENT OF MAX SCHLUETER

    Mr. Schlueter. Thank you, Mr. Chairman. The State of 
Vermont has been a participant in the NICS program as a point-
of-contact State since November of 1998, and as a point-of-
contact State, as we have heard here today, the Federal 
firearms licensee contacts the State of Vermont rather than 
NICS in order to conduct the pre-sale record check. As the 
Director of the Vermont Crime Information Center, I supervise 
the Vermont NICS and my testimony today will focus on the 
perspective of NICS from a POC State perspective.
    In 1998, when the State of Vermont was planning for the 
implementation of the permanent provisions of the Brady law, 
Governor Dean had two alternatives from which to choose. FFL's 
could contact the NICS directly for their pre-sale record 
check, or the FFL's could process their request through a 
Vermont point of contact. Governor Dean ordered that Vermont 
would take the latter approach and participate in NICS as a POC 
State.
    This option was selected because if the FFL contacted the 
NICS directly, NICS would only query Federal repository 
records. In Vermont, 80 percent of our felony convictions are 
not forwarded to the FBI's criminal repository because they are 
not fingerprint-supported. In addition, due to resource 
limitations, Vermont does not contribute relief from abuse 
orders to the National Crime Information Center and the vast 
majority of Vermont's wanted persons are not entered in NCIC. 
It is common among many States.
    As such, if FFL's were allowed to contact NICS directly, 
NICS would have no knowledge of these State records, and as a 
result, some individuals who should have been denied would 
actually be cleared for purchase. If FFL's contacted a Vermont 
POC, however, checks of the Vermont criminal history system, 
the Vermont relief from abuse order database, and the Vermont 
wanted persons database would be conducted in addition to the 
NICS check.
    Our analysis of NICS transactions indicates that the option 
ordered by Governor Dean was the right one. From November 1998 
through June 1, 2000, the Vermont POC has conducted nearly 
30,000 checks, in a State of 500,000 people. Approximately 700 
firearm purchases were denied because the buyer was a 
disqualified person under the provision of the Brady Act, and 
that is about 2 percent.
    Of those 700 denials, however, it is estimated that 28 
percent were denials on State charges which would not have been 
available to NICS if the FFL had contacted NICS directly. These 
purchases were denied because relief from abuse orders had been 
issued against them, they had been convicted of a misdemeanor 
crime of domestic violence, they were wanted in the State of 
Vermont, or they had been convicted of a felony and they had 
not been fingerprinted and, thus, their records were not at 
NCIC. These results, 28 percent, demonstrate the value of 
having the States act as a NICS point of contact.
    Despite the success of the Vermont POC program, we do have 
two concerns regarding the implementation of the Brady Act, and 
that is the lack of financial support for POC States and the 
number of final dispositions which are missing from criminal 
records.
    When Vermont became a POC State, it was the understanding 
that the NICS program would be a user fee-supported program, 
and we had planned to fund our program in Vermont by charging 
FFL's the same fee that NICS would have charged them if they 
had contacted NICS directly. In the final version of the Brady 
Act, as I am sure you are well aware, the fee provision was 
deleted, and as a result, the State of Vermont and other POC 
States had to scramble to identify alternative sources of 
funding.
    In Vermont, the POC program is currently funded totally by 
general revenue funds. During this past legislative session, 
however, there was considerable pressure to redirect funds from 
the POC program to other State priorities. Fortunately, 
advocates of the POC program were able to prevail, at least for 
another year. In order to ensure the continued participation of 
the State of Vermont and other States, such as Utah, we 
strongly recommend that a NICS user fee or an appropriation 
directly to the State to operate the NICS be considered.
    A second issue which hampers our ability to conduct a Brady 
check in an effective manner is the amount of missing data on 
criminal records. Final case dispositions are missing on 
approximately 75 percent of the criminal records that are 
reviewed by the Vermont POC. When a felony arrest is found on a 
record, a staff person must determine if that arrest was 
prosecuted, and if it was prosecuted, whether the case is still 
pending or resulted in a conviction. If this case disposition 
information is missing, the check cannot be completed and a 
delay response must be returned to the FFL. If the matter 
cannot be resolved within 3 days, as is frequently the case, 
the sale proceeds by default. On average, one case a week 
results in a default proceed transaction in Vermont. If the 
case is later resolved to indicate the purchaser was a 
disqualified person, then ATF must be contacted in order to 
effect a retrieval of the firearm.
    The State of Vermont strongly supports full funding of the 
Crime Identification Technology Act, known as CITA, and the 
National Criminal History Information Program, NCHIP, as major 
tools to assist the States to resolve the problems of missing 
dispositions. Both of these programs endorse a model which 
would facilitate the ability of the State's criminal history 
repository to improve the quality and completeness of criminal 
records and to advance criminal justice integration and data 
sharing projects, in particular, data sharing projects with the 
courts. These types of efforts should result in better quality 
records, create a single point of contact in the State for the 
timely resolution of missing data cases to avoid default 
proceed transactions.
    I appreciate the invitation to appear before the committee, 
Mr. Chairman, and thank you for consideration of our concerns.
    The Chairman. Thank you so much. We are glad to have your 
testimony.
    [The prepared statement of Mr. Schlueter follows:]

                  Prepared Statement of Max Schlueter

    The State of Vermont has been a participant in the NICS program as 
a Point of Contact State since November of 1998. As a Point of Contact 
(POC) State the federal firearms license (FFL) contacts the State of 
Vermont rather than NICS to conduct the pre-sale criminal record check. 
As the Director of the Vermont Crime Information Center I supervise the 
Vermont NICS program. My testimony will focus on the NICS system from 
the perspective of a POC State.
    In 1998, when the State of Vermont was planning for the 
implementation of the permanent provisions of the Brady Law, Governor 
Dean had two program alternatives from which to choose. FFLs could 
contact NICS directly for the pre-sale record check or FFLs could 
process their request through a Vermont Point of Contact. Governor Dean 
ordered that Vermont would take the latter approach and participate in 
NICS as a POC State. This option was selected because if the FFL 
contacted NICS directly for a record check, NICS would only query 
records in federal repositories. In Vermont 80 percent of our felony 
convictions are not forwarded to the FBI's criminal record repository 
because they are not fingerprint supported. In addition, due to 
resource limitations, Vermont does not contribute Relief From Abuse 
Orders to the National Crime Information Center (NCIC) and the vast 
majority of Vermont wanted persons are also not entered into NCIC. As 
such, if FFLs were allowed to contact NICS directly, NICS would have no 
knowledge of these state records and as a result, some individuals who 
should have been disqualified from purchasing a firearm would be 
cleared for purchase. If FFLs contacted a Vermont POC, however, checks 
of the Vermont Criminal History System, the Vermont Relief From Abuse 
Database, and the Vermont Wanted Person Database would be conducted in 
addition to the NICS check.
    Our analysis of NICS transactions indicates that the option ordered 
by Governor Dean was the right one. From November, 1998, through June 
1, 2000, the Vermont POC conducted nearly 30,000 checks. Approximately 
700 firearm purchases were denied because the buyer was a disqualified 
person under the provisions of the Brady Law. Of those 700 denials, it 
is estimated that 28 percent were denials based on state charges which 
would not have been available to NICS had the FFLs contacted NICS 
directly. These purchasers were denied because a relief from abuse 
order had been issued against them, they had been convicted of a 
misdemeanor crime of family violence, they were wanted in the State of 
Vermont, or they had been convicted of a felony in Vermont and not 
fingerprinted. These results demonstrate the value of having the states 
act as a NICS point of contact.

                             PROGRAM ISSUES

    Despite the success of the Vermont POC program, we do have two 
concerns regarding the implementation of the Brady Law--the lack of 
financial support for POC States and the number of final dispositions 
which are missing from criminal records.
    When Vermont became a POC State it was with the understanding that 
the NICS program would be a user-fee supported program. We had planned 
to fund our state program by charging FFLs the same fee that NICS would 
have charged them if they had contact NICS directly. In the final 
version of the Brady Act, however, the fee provision was deleted. As a 
result, the State of Vermont and other POC States had to scramble to 
identify alternative sources of funding. In Vermont the POC program is 
currently supported by general revenue funds. During this past 
legislative session, however, there was considerable pressure to 
redirect funds from the POC program to other priorities. Fortunately, 
advocates of the POC program were able to prevail--at least for another 
year. In order to ensure the continued participation of the State of 
Vermont and other states as POCs would strongly recommend a NICS user 
fee or an appropriation directly to the state to operate the NICS 
center.
    A second issue which hampers our ability to conduct the Brady 
checks in an effective manner is the amount of missing data on criminal 
records. Final case dispositions are missing on approximately 75 
percent of the criminal records reviewed by the Vermont POC. When a 
felony arrest is found on a record a staff person must determine if 
that arrest was prosecuted, and if prosecuted whether the case is still 
pending or whether the case ended in conviction. If this case 
disposition information is missing the check cannot be completed and a 
delay response must be returned to the FFL. If the matter cannot be 
resolved within three days, as if frequently the case, the sale 
proceeds by default. On average, one case a week results in a default 
proceed transaction in Vermont. If the case is later resolved to 
indicate that the purchaser was a disqualified person then ATF must be 
contacted to effect retrieval of the firearm.
    The State of Vermont strongly supports full funding of the Crime 
Identification Technology Act (CITA) and National Criminal History 
Improvement Program (NCHIP) as major tools to assist the states to 
resolve the problem of missing dispositions. Both of these programs 
endorse a model which would facilitate the ability of a state's 
criminal history repository to improve the quality and completeness of 
criminal records and to advance criminal justice data integration and 
data sharing projects. These types of efforts should result in better 
quality records and create a single point of contact in each state for 
the timely resolution of missing data cases so as to avoid default 
proceed transactions.
    I appreciate the invitation to appear before the Committee. Thank 
you for your consideration of our concerns.

    The Chairman. Let me go back to Mr. Loesch again. Although 
the idea behind NICS was to make background checks instant, 
only 72 percent of the FBI checks are completed within 30 
seconds. That is remarkable, but it is still not good enough. 
The others take hours, days, or even weeks to complete, and we 
are not even talking about the times that the system was 
unavailable due to computer outages.
    The FBI has claimed that most delays result from incomplete 
criminal background information in the databases. I would like 
to know, and I think all of us on the committee would like to 
know, whether the FBI is taking proactive steps to improve the 
data, such as researching case dispositions where the database 
reflects only an arrest, or whether the FBI is simply 
responding passively by waiting until someone attempts to 
purchase a gun.
    Mr. Loesch. Well, we are doing a number of things to assist 
in getting those upgraded. Of course, we deal with that through 
the Advisory Policy Board and our five different working 
groups, regional working groups, as well as the five 
subcommittees that are involved with the APB. We have had our 
individuals in the NICS program actually going out to the 
various clerk of courts in meetings throughout the country, 
basically talking about the importance of the courts really 
recording these dispositions on all of these files that are out 
there. We are publishing some various articles about the 
importance of that in our CJIS Link, which is our newsletter 
that goes out to over 80,000-some different criminal justice 
entities and then gets recopied out there.
    But as far as going into the records themselves, I mean, 
barely, we can keep up with the work we have today without 
being able to do that. Those are some of the kinds of things we 
would like to do, but that would, we feel--we have looked at 
that. That has been one of the things that we have kind of had 
on our agenda to be able to put some things together, but you 
would have to go out to basically every State. We have even 
thought of how do we do this. I mean, they are all over the 
place.
    This information, basically, the States right now cannot 
even keep up giving us the information just on the NICS 
inquiries we get in, which is for us only about 6.5 million or 
so out of the 13 million in 18 months. We are not even able to 
get that kind of cooperation right now because the States do 
not have the people on board that can find these records 
because they cannot pay them.
    The Chairman. Right. Well, we are going to try and solve 
that. It appears that many of the problems with both 
reliability and the completeness of NICS are due to it being a 
combination of several different databases, the III, NCIC, and 
NICS Index, just to mention the three of them, and that a 
failure of any one of those systems will bring the Instant 
Check to a halt. You have already talked about the complexity 
of the system.
    Has the FBI given any thought to creating a fully separate 
NICS system containing only information relevant to firearm 
purchase denials to increase redundancy and reduce the problem 
of integrating these databases? Have you thought about that? 
And let me just ask you this. Would such a step reduce the 
problem of false hits on the system based on records with 
unrecorded dispositions?
    Mr. Loesch. That is a big question, Senator.
    The Chairman. That is a big question.
    Mr. Loesch. You know, we have talked about, obviously, how 
nice it would be to have just a separate system, but in order 
to do that, you would have to basically replicate the entire 
III system, and the way that whole system is kept up is through 
fingerprint submissions and new arrest data and things of that 
nature. You would need to take all of those databases and 
really build a totally other system that would be used just for 
NICS type of checks. I am still not sure it would make any 
difference unless you get the disposition information you need 
in there. We would still have the same kind of problems, is 
what I would see. I mean, I look at my colleagues. They are 
shaking their head yes. It really would not solve anything.
    The Chairman. All right. The NICS system has prevented 
thousands of prohibited persons from obtaining firearms. Now, 
the record on enforcement is quite a different story. Even 
though a significant number of these people violated Section 18 
U.S.C. 922(a)(6) by misrepresenting their background on the 
required forms, the Justice Department prosecuted only one case 
for every 880 denials. Regardless of how well the NICS system 
operates, do you not agree that without enforcing the existing 
laws, we will not reduce the misuse of firearms in our country?
    Mr. Loesch. I agree with you. I believe we should enforce 
those laws. That is not the FBI's job, of course, but I do have 
some understanding on--we do, in fact, contact the ATF any time 
we get someone that has come in here that has been denied that 
is trying to get a gun that should not get one. My 
understanding is from them, of course, is that they try to go 
through that record and really look at who is the most violent 
and who would be considered to be the most--I mean, there are 
only so many U.S. attorneys and prosecutors around there that 
do that. But that is not the FBI's job.
    The Chairman. Do you believe that the convicted felons who 
were prevented from buying guns by the NICS check simply 
stopped trying to obtain a gun?
    Mr. Loesch. No, sir.
    The Chairman. They have gone out and obtained them from 
private sources, if they are stopped there. So that is one 
thing I am concerned about.
    Let me just ask you a question, Ms. Ball. It has been 
wonderful having you here.
    Mr. Loesch. Thank you, Senator.
    The Chairman. But you testified, Ms. Ball, in the 18 months 
since the NICS system began, you have seen only one instance in 
which a transaction was denied due to a background check.
    Ms. Ball. Correct.
    The Chairman. Yet you implied that many of your customers 
experienced delay in getting their transactions approved. Could 
you please elaborate on this and explain what typically happens 
in your store when you undertake a NICS search for a customer.
    Ms. Ball. When we run the information through the NICS 
system, about 40 percent of those customers get a denied status 
or they give us the hold number and we have to retain the 
firearm. Most of those are cleared within the 3-day period that 
NICS requires for that. But I do have about 40 percent delayed. 
We get called back with a ``proceed,'' but it slows down the 
process.
    The Chairman. I see. So it is not as fast as the 72 
percent.
    Ms. Ball. No. My numbers do not----
    The Chairman. In your case.
    Ms. Ball. Yes. My numbers are definitely higher on delays.
    The Chairman. Let me ask one other question. Since the NICS 
system became operational, hundreds of firearms have been 
transferred into the hands of prohibited persons due to the so-
called default proceed rule. That rule says that a transaction 
may proceed if the agency in charge of the background check 
takes longer than 3 days to complete the check. Now, there are 
those who want to amend the NICS law either by extending the 
default time to as much as 30 days or by allowing the existence 
of a bare arrest rather than a conviction to be a basis for 
prohibiting a transaction. How would you and your customers 
react to adding extra time on to the default rule?
    Ms. Ball. I think you are going to find customers are going 
to object to that, and just by virtue of adding additional time 
onto that default process, reduces the push that we all would 
like to see to get that system up and running the way it is 
supposed to. We are at 3 days now. If we give them 5 to 
complete those background checks, they are going to take 5. It 
is not uncommon for me to call back into NICS on the third day 
and say, what is the status of this, and they have been sitting 
on it for a couple of days and have not called me back with a 
``proceed.''
    So extending that default time, I do not agree with. 
Personally, as a dealer, we do not make the transfer, but that 
has been a decision that we made in-house. Rarely do I get--
well, obviously, if I have only had one since NICS went into 
operation. They always call back with a ``proceed,'' but I 
still am not going to make a transfer until we have either a 
positive or a negative statement from the NICS system. But I do 
not think extending that default period is an answer to solving 
the things that we are talking about here today.
    The Chairman. You make a pretty good case.
    My time is up. Senator Leahy.
    Senator Leahy. Thank you, Mr. Chairman.
    Ms. Ball, the other part of what Senator Hatch has raised, 
how would you feel if it added a simple arrest as being 
something to stop?
    Ms. Ball. A simple arrest?
    Senator Leahy. Yes.
    Ms. Ball. Well, I am all for enforcement of the laws that 
are out there. We have never had one that I am aware of turned 
over from the----
    Senator Leahy. No, no, no, I mean for denial, the fact that 
somebody had an arrest record but not necessarily results that 
show a conviction.
    Ms. Ball. I guess that would be--I cannot answer that 
without knowing what you are referring to as far as an arrest 
for what. An arrest for jaywalking? Probably I would disagree.
    Senator Leahy. No, but say there is an arrest for a felony 
on the record. Do you think it would be fair to say to 
somebody, well, we are going to stop any sale there, or do you 
feel that it must show conclusively first a conviction?
    Ms. Ball. Well, I would think that you would have to show 
conclusively a conviction. If we are innocent until proven 
guilty, I think that is really----
    Senator Leahy. I tend to agree with you. I am just asking--
--
    Ms. Ball. That is a really important issue, I think.
    Senator Leahy. Then let me go to Mr. Loesch on this. On 
enforcement, obviously, if somebody comes--well, I say 
obviously, you may disagree with me--you have a 45-year-old 
person who comes in now to buy a weapon and they, when they 
were 18 years old in college passed a bad check and got a 
record on it, I mean, actually got convicted and made 
restitution, probably got a $100 fine, but it is a felony. So 
now, 25 years later, they put down, have you ever been 
convicted of anything, and maybe they remember, maybe they do 
not. They say no and they get denied. Now, if you were the U.S. 
attorney, would you say, stop what we are doing, let us go 
after that person, or would you feel that that is is probably 
something we take a bye on?
    Mr. Loesch. If I were the U.S. attorney, of course, I would 
probably take a bye on it.
    Senator Leahy. But now, on the other hand, if that person 
had been convicted of bank robbery 4 years before, how would 
you feel then?
    Mr. Loesch. It would be a different story.
    Senator Leahy. If ATF, as they say, do not have enough 
agents to go back and do that, because, of course, they would 
have to have not only the fact that they were denied it, but 
then they have got to go back and prove the conviction, they 
have got to establish, one, this was the person, second, that 
they were convicted, and then third, prove and make sure that 
you have people in the gun shop that can positively identify 
that this was John Jones who came in here, and then having done 
all that, and that they saw him sign it and, indeed, they can 
prove that this is the person who signed it, then you have got 
to go back and connect that person to the crime. The ATF agents 
say, we do not have enough to do that with all the other 
responsibilities. Well, then should we tell the FBI to start 
helping them out?
    Mr. Loesch. I think the FBI has enough to do, Senator, 
right now, with the resources we have currently available to 
us.
    Senator Leahy. If they do not have resources and you do not 
have resources, who is going to do it?
    Mr. Loesch. I do not know. I do not have the answer to 
that.
    Senator Leahy. But you say it is a resource problem?
    Mr. Loesch. I would say it would be a resource problem the 
way you have explained the process to me or the problem to me.
    Senator Leahy. I am just asking. I was a prosecutor. I know 
how difficult it is sometimes to have resources for everything 
you want to do. But somewhere, we have to make priorities here. 
If this should be a priority, going after people who have-and I 
am one who feels there should be more prosecutions. I do not 
feel there are enough prosecutions of people who lie on these 
Brady applications, but how do we do it, because the States are 
not going to do it, am I correct?
    Mr. Loesch. Correct.
    Senator Leahy. And the FBI is not going to do it, and the 
ATF does not have the people to do it, so where do we put more 
people?
    Mr. Loesch. I do not know.
    Senator Leahy. So that is the question. I think we should 
be doing a lot more to support the States that want to conduct 
their own background checks. We have Utah and Vermont here 
represented. The NICS is mandated by Federal law, but a lot of 
States are picking up the tab for conducting effective 
background checks. My State happens to be a State that has 
virtually no gun laws. There are exceptions to that. We limit 
the number of rounds you can carry in a semi-automatic during 
deer season. We do want to make sure the deer have some kind of 
an opportunity here. [Laughter.]
    But we do not really limit them in the number of rounds you 
carry as a concealed weapon. I mean, anybody can carry a loaded 
concealed weapon in Vermont without a permit. You can carry 
guns. There is a certain limit. Most of our limitations, I 
think Mr. Schlueter, you would agree, are based on fish and 
game laws, whether you can have the hunting rifle loaded in the 
car or whatever. But that works for Vermont. We have also the 
lowest crime rate in the country.
    But we are told to make these checks when people go in to 
purchase a weapon, and we are a law-abiding State and we will 
say if that is the Federal law, we will do it. But I think that 
any other State that is doing this should be given help by the 
Federal Government. If the Federal Government is going to tell 
us to make these checks, whether we would normally make them or 
not, we ought to get some compensation for it, and the more 
comprehensive criminal history records are currently available 
at the State and local level in the States rather than at the 
Federal level. That is, I guess, why about half of the States 
have determined to be the points of contact.
    Now, Mr. Schlueter has already said that about 28 percent 
of the denials of prohibited people making firearm, or trying 
to make firearm purchases in Vermont are based on State charges 
which would not have been in the FBI list, and I say this 
because this is why Senator Hatch and I and others are 
introducing the Partnership Act of 2000, the NICS Partnership 
Act of 2000, which I think will help this a great deal. In 
fact, Senators Kohl and Schumer are original cosponsors of the 
bill. This legislation would authorize $150 million for the 
next 3 years for the Department of Justice to reimburse States 
for this.
    I think the effective Brady background checks are the 
responsibility of the Federal Government under Federal law, 
because the State laws change and vary so differently among our 
50 States on firearm purchases and firearm ownership. But if it 
is a Federal law and a Federal responsibility but the States 
are doing the work, well, then the States ought to be 
reimbursed their costs in doing this.
    I think if that happens, I think that the problems that Ms. 
Ball has raised and problems, incidentally, I hear from gun 
dealers in my own State, may well go away. My suggestion, Mr. 
Chairman, is that we do find a better way to bring in both the 
State and local convictions with the Federal convictions so 
that you know whether they are going under Captain Smith's 
jurisdiction or anybody else's, you know you have an accurate 
report.
    I do not have a problem with U.S. attorneys saying that on 
basically de minimis matters, the 30-year-old bad check case or 
something like that, in not prosecuting. I do acknowledge very 
much that there is a major advantage to the country that people 
with felony records are being denied licenses, or being denied 
sales, although there is a major gun show loophole that they 
can still use to get around that. That is something that we 
should close.
    But, frankly, I do feel that there should be more 
aggressive prosecution of people who have lied on applications 
when they have serious offenses on their record. I think if we 
had more effective prosecution of that and, at the same time, 
close the gun show loophole, because I can guarantee you right 
now, if you start having more effective prosecution on this 
from the legitimate gun stores, those that pay the taxes on 
Main Street and everything else, that fill out all the forms, 
if you start effectively prosecuting some of the people who 
make false claims there, they are all going to go to gun shows 
because they know that there, they can get away with it scot-
free. So you have got to close the loophole and have more 
effective enforcement.
    Mr. Chairman, I think that the legislation you and I have 
here and others, I think this could be very, very helpful. In 
fact, if we have Senator Schumer and Senator Kohl, the two who 
have probably taken a somewhat different view on gun control 
than you and I and some others from States that have different 
histories, the fact that we are all joined together may help. I 
see Captain Smith smiling. I think you want to know when a 
question is asked that you get the right answer. Am I putting 
words in your mouth, Captain?
    Captain Smith. No, sir, that is it.
    Senator Leahy. Again, I want to say what Max has done and 
the State police and others in Vermont has been very, very 
impressive for our State and I am very proud to be here.
    Again, I apologize that a doctor's appointment went a lot 
longer than I thought it was going to this morning and that I 
was late, but Mr. Chairman, I do appreciate you holding this 
hearing. I think it is an extremely important one.
    The Chairman. I just hope that psychiatrist got a lot done 
there today. [Laughter.]
    Senator Leahy. It was not a psychiatrist. It was an eye 
doctor.
    The Chairman. All right. [Laughter.]
    Senator Leahy. I just wanted to be able to see you better, 
Mr. Chairman, you know, you handsome devil, I really did.
    The Chairman. I can imagine. I can imagine. [Laughter.]
    Senator Leahy. He does not know what to say at that point.
    The Chairman. Let me just ask the two of you----
    Senator Leahy. He is just praying that nobody back in Utah 
is watching right now.
    The Chairman. That is right. [Laughter.]
    Let me just ask the two of you, the State administrators, 
you have both done terrific jobs as far as I can see and you 
both are experts in this area, but how do your States use the 
NICS denials to prosecute attempted illegal purchases? Do you 
prosecute at a higher or lower rate than the Federal 
Government, Captain Smith and then Mr. Schlueter?
    Captain Smith. I would again have to almost echo Assistant 
Director Loesch's comments, that we are so woefully 
understaffed to do that. Our response to denials is to take 
that list and broadcast that list to all law enforcement 
Statewide, both Federal, local, and State, so they are aware of 
those people that have come in.
    I will go back to Senator Leahy's comment. One of the big, 
big problems here is if you are going to prosecute them, you 
have got to show that it was them, and that is such a stumbling 
block for prosecution that it almost bars it. If we went to 
maybe a thumbprint or something on that form, you would have 
something to go with, in the way of suggestion. But when you 
have to start an investigation with, was this really the guy, 
and then go hunt down all the people that can establish that, 
you have effectively killed any prosecution of that, in my mind 
anyway.
    The Chairman. I see. Mr. Schlueter.
    Mr. Schlueter. I would concur with Captain Smith. Of 
course, in the State of Vermont, we have no grounds to 
prosecute a case like this because this would be a violation of 
the Federal law, and so we refer those cases to ATF.
    The Chairman. I see.
    Mr. Schlueter. Our experience is similar in Vermont as in 
other States in terms of the frequency of prosecution.
    The Chairman. It does appear from the GAO report requested 
by Senator Thomas that the rate of prosecutions for these 
violations is quite low due to two factors, the lack of 
referral of these cases by ATF and the lack of charges filed by 
U.S. attorneys. From your perspectives as law enforcement and 
criminal justice officials, what could be done to address the 
low levels of action on the part of both agencies? Let us start 
with you, Mr. Schlueter, first, and then with you, Captain 
Smith.
    Mr. Schlueter. Again, I think the problem, as has been 
pointed out, is that it is almost an unenforceable statute 
given the burdens of proof for the investigating agency. I am 
not sure that additional resources to ATF or FBI or even at the 
State level would make a significant dent in those prosecutions 
in terms of increasing them.
    The Chairman. I see. Captain Smith.
    Captain Smith. Mr. Chairman, again, like Vermont, we do not 
have a State law that allows us to go ahead and proceed there. 
I suppose we could do some things under false representation or 
something else, but it is a Federal form. We refer those to the 
Bureau of Alcohol, Tobacco, and Firearms. As Mr. Loesch has 
stated and others, they are just woefully understaffed to do 
that.
    At the State level, I think if we wanted to take that on, 
there would probably have to be an inducement, and although I 
spend a lot of time at the State legislature every year, having 
them pass a law to say we are going to take on another kind of 
a very difficult and almost unenforceable task, we would have 
to see that form change, I think, and have the type of 
identification at the front end established so clearly that 
basically what you would have, like Senator Leahy says, is a 
slam-dunk case. As a prosecutor, you would say, this is 
absolutely the guy. He came in there and he put his thumb print 
on that and, by golly, we are going to go after him because of 
it.
    The Chairman. That is good to know.
    One last question for you, Mr. Loesch, and then, unless 
Senator Leahy has some questions, we will finish. Early last 
year, representatives from all the major industry and firearms 
user groups petitioned the FBI to form a users advisory group 
for the NICS system as provided for under the Federal Advisory 
Committee Act. After expressing initial interest in the idea, 
the FBI stalled for over a year. Now the FBI has decided to 
host only a single meeting for some 500 dealers instead.
    Why did the FBI reject the idea of a users advisory group, 
particularly when given the increasing scope of problems with 
the system, and what does the FBI expect to accomplish by 
hosting hundreds of dealers instead of a reasonably-sized 
working group?
    Mr. Loesch. Well, I do recall that communication coming in. 
I think it was five different groups that were asking for that, 
and we discussed that, of course, with our Advisory Policy 
Board executive committee, and at that time the feeling was, 
and within the FBI also, was that we already had a number of 
various advisory policy type of boards with a compact council, 
now that we are running along with the APB, and the real 
feeling was that we would, in fact--we went back out to them 
with a letter and basically said we would, in fact, host some 
type of meeting, and it is this summer, as a matter of fact, 
and we have invited in for input, of course, to get input from 
the dealers as well as those organizations, and I do not 
remember all the organizations. I think the NRA was one of 
them, but there was a Shooters Association, there were like 
five different organizations there. They have been invited to 
participate, also, to meet with us, as well as members of 
Congress, I believe, on that.
    So the idea was to get as much input as we can, I mean, 
from--we would really like to be in contact, of course, with 
the dealers, the people that are actually out there at the 
point of the sale as to running this system and finding out how 
we are doing or what do we need to do better, and the more of 
those we can get in and listen to, the better off we feel we 
would be able to run the system.
    I mean, if we were going to have, and I do not believe they 
would be covered under the Federal Advisory Committee Act as a 
group anyway. I think we could probably have some kind of 
subgroup within our advisory process for them if it was decided 
that was the way to go. But what we were looking at, we looked 
at that one group, then we said what we really need to do is to 
have representatives from the dealers, the people that are 
actually the K-Marts and the Wal-Marts, the large people that 
are processing this and the large gun stores throughout the 
country, that they would be the ones we really need in there 
talking to us on this business. Now, whether those groups would 
be representing them, we personally would like to have those 
kind of people in there, and we are having that this year, this 
summer.
    The Chairman. Thank you. We will keep the record open until 
the close of business for any further statements by members of 
the committee or any further questions that they would like to 
submit in writing.
    Senator Leahy.
    Senator Leahy. I just want to kind of emphasize what Mr. 
Schlueter said earlier about the fact that since we do not have 
Vermont laws or State laws on these, there really is not any 
way that Vermont is going to go out and prosecute on these 
matters. It is also going to limit somewhat what the U.S. 
attorney or anybody else could do.
    But also, as Captain Smith pointed out, it is very easy to 
say we do not prosecute a lot of these things, but that is like 
saying, right now on the interstate in Utah or in Vermont, 
there are speeders who are not being prosecuted because there 
is nobody there, number one, but secondly, it is more than 
that.
    Again, the hypothetical I would use, John Jones comes into 
Provo or into Waterbury Center and comes in and there are two 
or three people working there and picks out the .44 Smith and 
Wesson and says, gee, I really like this, 8\3/8\ inch barrel, 
it is magnaported, it is a nice weapon, stainless steel--
actually describing a weapon I picked up a couple years ago--so 
they have got three or four people going back and forth. 
Suddenly, someone hands him a form to fill out. Somebody else 
sort of picks it up and they go through the thing and guy says, 
I am going down to get some coffee. I will be back.
    They check, and during that time they find it comes back 
and this guy has got three armed robberies and so on and so 
forth, but he may have looked in the window and seen them all 
talking and he decides not to come back in. Now the U.S. 
attorney has got that. Do you remember that man that came in? 
The first clerk, yes, a tall, thin guy. The second clerk, no, 
he is kind of short and stocky. The next one says, well, he had 
a moustache. No, he did not have a moustache but I do remember 
the sandy hair. What do you mean, sandy? It was dark.
    Now, anybody who has ever had a case, and Captain, I am 
sure you have had cases like that when you have gone, not 
necessarily on guns but on some other matter, and now, if you 
can figure that out, you have got to go back and figure out 
those convictions and tie the two together. So it is not an 
easy thing to say, gee, somebody put a wrong statement on 
there. That would be a slam-dunk case. It is a long way from 
that.
    Now, if they are doing it, they are being videotaped doing 
it, the thumbprint and everything else, it gets better and it 
gets easier, but it is still not the slam-dunk case that some 
people think, and I just point that out, that one would start 
trying to keep that felon from buying the weapon in the first 
place, and that does have a very good goal and I agree with 
that. But as far as some of this enforcement of the lying on 
it, it is not the easiest thing in the world to do. So I 
appreciate from both of you the immediate, real kind of 
testimony you have given.
    Ms. Ball, I appreciate the concerns you say, especially the 
one where you call up and say, hey, where is the answer? Oh, 
yes, we have got to get to that. That, I hear a little bit too 
often from people. The bad news is that it happens. The good 
news for you is you are not alone in this. I know a lot of 
other gun dealers who have had similar things.
    But, Orrin, thank you very much for holding this hearing. I 
do have a statement that I would like to have included in the 
record.
    The Chairman. Thank you, Senator.
    [The prepared statement of Senator Leahy follows:]

 Prepared Statement of Hon. Patrick J. Leahy, a U.S. Senator From the 
                            State of Vermont

    I thank the Chairman for holding this hearing today on ways to 
improve the National Instant Criminal Check System (NICS). I look 
forward to hearing from all of our witnesses. In particular, I would 
like to thank Max Schleuter, Director of the Vermont Crime Information 
Center, for coming to Washington to testify about the way Vermont 
handles its NICS checks and his suggestions for improvements to the 
NICS.
    I also want to acknowledge my old friend, Senator Bob Dole, the 
former Majority Leader. It is good to see you again.
    The Brady Handgun Violence Prevention Act of 1994 established the 
NICS and required federal firearm licensees to conduct a background 
check on the purchaser of any firearm sale after November 30, 1998. In 
its first 18 months of operation, the NICS has been a highly effective 
system for keeping guns out of the hands of criminals and children. 
Having processed more than 10 million inquires during this time, the 
NICS has ensured the timely transfer of firearms to law abiding 
citizens, while denying transfers to more than 179,000 felons, 
fugitives, and other prohibited persons.
    That is a remarkable record in preventing crime and protecting 
public safety. I fully support the NICS as a way to prevent criminals 
and juveniles from purchasing firearms without forcing a waiting period 
on law-abiding citizens who want to purchase firearms. I believe, 
however, that the NICS system can and should be improved.
    The first way to improve the NICS is to make sure it is up and 
running. For 66 hours--from the afternoon of May 11 to the morning of 
May 14, 2000--the NICS system lost all service. For nearly three days, 
law-abiding citizens could not purchase firearms because the FBI could 
not conduct any background checks. That is unacceptable. I look forward 
to hearing the testimony of David Loesch, Assistant Director in Charge 
at the Criminal Justice Information Services Division of the FBI to 
explain to us why this NICS system failure happened and how to prevent 
any future service failures.
    I also believe Congress should do more to support states who want 
to conduct their own background checks. The NICS is mandated by federal 
law, but many states are picking up the tab for conducting effective 
background checks. Since more comprehensive criminal history records 
are currently available at the state and local levels in many states 
than at the federal level, about half of the states have elected to 
serve as points of contact (POCs) to access the NICS.
    A state POC is a state agency that agrees to conduct Brady 
background checks, including NICS checks, on prospective gun buyers. In 
states that have agreed to serve as POCs, federal firearm licensees 
contact the state POC for a Brady background check rather than 
contacting the Federal Bureau of Investigation. These POC background 
checks review more records of people in prohibited categories, such as 
people who have been involuntarily committed to mental institutions or 
are under domestic violence restraining orders.
    Indeed, in my home state of Vermont, for example, which serves as a 
POC, approximately 28 percent of all denials of prohibited persons 
seeking firearm purchases are based on state charges which would not 
have been available for review at the FBI's criminal record repository.
    Currently, these 15 states serve as full POCs for NICS: Arizona, 
California, Colorado, Connecticut, Florida, Georgia, Hawaii, Illinois, 
Nevada, New Jersey, Pennsylvania, Tennessee, Utah, Vermont and 
Virginia. Another 11 states serve as partial POCs for NICS by 
performing checks for handgun purchases while the FBI processes checks 
for long gun purchases: Iowa, Michigan, Nebraska, New York, North 
Carolina, Indiana, Maryland, New Hampshire, Oregon, Washington, and 
Wisconsin.
    In fact, of the 8,621,000 background checks conducted last year, 
4,538,000 were handled by the FBI and 4,083,000--almost half--were 
handled by state POCs. So while some states relied on the FBI to 
conduct Brady background checks and paid nothing, the states that 
elected to conduct more effective background checks paid the full cost 
of them. That is unfair to states that are doing the right thing.
    Today, I am introducing the NICS Partnership Act of 2000 to remedy 
this inequity. I am pleased that the Chairman of the Judiciary 
Committee, and Senators Kohl and Schumer on the committee, are original 
cosponsors of the bill. Our bipartisan legislation would authorize $150 
million for the next three years for the Department of Justice to 
reimburse states for their reasonable and necessary costs for serving 
as a POCs.
    Effective Brady background checks are the responsibility of the 
federal government under federal law. As a result it is only fair for 
Congress to reimburse states their reasonable costs needed to conduct 
effective Brady background checks. I look forward to the prompt 
consideration of our bipartisan legislation.
    Another way to improve the NICS is to close the gun show loophole. 
On May 20, 1999, by a vote of 73-25, the Senate passed a juvenile 
justice bill that contained a modest measure to crack down on illegal 
gun sales at gun shows by requiring NICS checks of prospective buyers. 
Under current law, gun show dealers do not have to abide by the same 
background checks as federally licensed firearms dealers. Since the 
Lautenberg amendment was included in the juvenile justice bill, the 
Republican leadership has simply refused to convene a conference 
committee meeting on the broader juvenile justice legislation. We 
should be moving on it now, not waiting for the next tragic shooting to 
occur.
    I look forward to working with the Chairman and other members of 
the committee to improve the NICS on a bipartisan basis, and I thank 
our witnesses for appearing today.

    The Chairman. We really want to thank all of you for being 
here. It has been very helpful to us as we try to resolve some 
of these problems. I just want to express my gratitude to each 
of you, and with that, we will recess until further notice.
    [Whereupon, at 12:10 p.m., the committee was adjourned.]


                            A P P E N D I X

                              ----------                              


                 Additional Submissions for the Record

                              ----------                              


Prepared Statement of Hon. Rick Santorum, a U.S. Senator From the State 
                            of Pennsylvania

    Dear Chairman Hatch and Members of the Committee: I am pleased to 
have the opportunity to submit Check System (NICS) for firearm 
purchases. Specifically, I am concerned about the reliability of the 
system and the failure of the NICS to meet its operating accountability 
standards. I want to thank the Chairman for his leadership on this 
important issue and the members of the Committee for your attention to 
these system failures. I have encouraged the Committee to have a such a 
hearing because this issue is important to the citizens of 
Pennsylvania.
    I was disturbed to learn that the results of a General Accounting 
Office (GAO) investigation, requested by Senator Craig Thomas, 
indicated that a variety of significant failures have prevented the 
system from operating as Congress had intended. Among the most 
outrageous findings of the GAO investigation, was the revelation that 
3,353 prohibited individuals had been permitted to purchase firearms as 
result of repeated NICS failures. In the 56,554 cases where individuals 
had been denied the ability to purchase a weapon due to felony 
convictions, less than 200 individuals had actually been prosecuted for 
falsifying their applications. This evidence is in strong contradiction 
to my support and the support of many on this committee to expand the 
efforts of Project Exile throughout the country.
    Additionally, I was troubled to learn that the system had failed to 
provide instant checks over 28 percent of the time and that there were 
360 occasions of unscheduled outages of the NICS. In fact, during first 
two weeks of last month, The NICS system was off-line for nearly five 
days. It has been estimated that small business owners lose 
approximately $2.5 million in sales for each day that the system is 
off-line.
    I am deeply concerned that this system, which had been created by 
Congress in order to screen potential firearms purchases for criminal 
background, has actually allowed the sale of thousands of weapons to 
dangerous felons, while it has also prevented law-abiding citizens from 
enjoying their constitutionally protected right to keep and bear arms. 
For these reasons, I have contacted FBI Director Louis Freeh for an 
explanation of these failures and await his response.
    I would again like to thank the Judiciary Committee for this 
important hearing to address this situation. I look forward to working 
with you ti improve the effectiveness of the NCIS is the interests of 
American consumers and public safety. Thank you again for this 
opportunity.

Prepared Statement of Hon. Jeff Sessions, a U.S. Senator From the State 
                               of Alabama

    Mr. Chairman, the consistent and effective operation of the 
National Criminal Instant Criminal Background Check System (NICS) is an 
essential tool in keeping firearms out of the hands of criminals. The 
NICS system is a crucial first step in preventing criminals from 
obtaining a firearm. If combined with timely prosecutions of those 
disqualified persons (e.g., convicted felons, fugitives, and spouse 
abusers) who illegally attempt to obtain a firearm, NICS can actually 
prevent a criminal from obtaining a firearm and using it to commit a 
crime of violence.
NICS: The Critical Importance of Prosecution
    When a person attempts to purchase a firearm from a federal 
firearms licensee, he must undergo a NICS check either directly through 
the federal system, or indirectly through a Point of Contact (POC) 
state.\1\ If the NICS check reveals that the person is a convicted 
felon, fugitive from justice, spouse abuser, or other disqualified 
person, it will deny that sale.\2\ Further, when a convicted felon or 
other disqualified person completes the form necessary to perform the 
NICS check and fails to reveal that he is a disqualified person, he has 
committed a felony punishable by up to 10 years in prison.\3\
---------------------------------------------------------------------------
    \1\ 18 U.S.C. Sec. 922(t).
    \2\ 18 U.S.C. Sec. 922(t), (g), and (n).
    \3\ 18 U.S.C. Sec. Sec. 922(a)(6), 924(a)(2).
---------------------------------------------------------------------------
    If a disqualified person commits a felony in attempting to purchase 
a firearm, is denied by the NICS check, but is not arrested, he can 
still purchase a firearm from an illegal source. For example, 
approximately 89% of firerarms used in crimes are purchased from 
illegal sources that do not use NICS checks, such as straw purchasers, 
firearms, thieves, gangs, and firearms traffickers.\4\ Thus, unless a 
criminal who is denied the purchase of a firearm by a NICS check is 
quickly arrested, he can simply go to an illegal source and obtain the 
firearm.
---------------------------------------------------------------------------
    \4\ ATF Performance Report: The Youth Gun Crime Interdiction 
Initiative 13 (Feb. 1999).
---------------------------------------------------------------------------
    In fact, Benjamin Nathaniel Smith did just that. After failing a 
NICS check and not being arrested, Smith went and illegally purchased 
several firearms from an illegal seller. He then went on to shoot 
eleven people in Illinois and Indiana with those firearms.\5\ Had he 
been arrested and prosecuted after failing the NICS check, this 
horrible incident would never have occurred.
---------------------------------------------------------------------------
    \5\ David Ollinger, ``Seller Gets 10 Months in July 4 Gun 
Rampage,'' The Denver Post, p. A-11 (Mar. 4, 2000).
---------------------------------------------------------------------------
NICS Operation
    In any event, the consistent and efficient operation of the NICS 
system is crucial to enabling law enforcement to identify and prosecute 
convicted felons and other disqualified persons who are actively 
seeking to purchase firearms. When the NICS system is not working, 
federal firearms licensees are unable to conduct background checks and 
cannot transfer firearms to anyone, including qualified purchasers.\6\ 
Thus, minimizing downtime is essential to allowing law-abiding, 
federally-licensed dealers to conduct lawful business from stores and 
gun shows.
---------------------------------------------------------------------------
    \6\ 18 U.S.C. Sec. 922(t).
---------------------------------------------------------------------------
    Unfortunately, the NICS system experience unscheduled outages or 
downtimes on May 11-14, May 17, and May 22, 2000. These outages 
effectively shut down legitimate businesses across the nation, 
resulting in lost business, and perhaps lost opportunities to identify 
convicted felons who were illegally attempting to purchase firearms.
    I understand that the Federal Bureau of Investigation (FBI) is 
addressing the causes for these outages. On June 8, 2000, Mr. Loesch of 
the FBI sent me a letter stating, ``while still under study, all 
indications point to the root cause [of the outages] as a defect in the 
proprietary database management software which causes an incorrect and 
corrupting calculation of table spaces within the [Criminal Justice 
Information Services Division's Interstate Identification Index].'' \7\ 
While the FBI's attempt to address this problem is admirable, I am 
considering whether legislation providing operational standards for 
NICS, additional funding for NICS, and funding for POC States is 
appropriate.
---------------------------------------------------------------------------
    \7\ Letter from David R. Loesch, Assistant Director In Charge, 
Criminal Justice Information Services Division, Federal Bureau of 
Investigation, to Sen. Jeff Sessions, 2 (Jun. 8, 2000) (on file with 
the Committee on the Judiciary).
---------------------------------------------------------------------------
NICS Denials
    During 1999, the total number of NICS denials was 204,000.\8\ 
Approximately 75% of those denials were because the attempted purchaser 
was a convicted felon or fugitive from justice.\9\ Thus, law 
enforcement authorities last year were placed on notice that 204,000 
disqualified persons, including a large proportion of convicted felon 
and fugitives from justice, were actively attempting to acquire 
firearms. Furthermore, the NICS check process gave to law enforcement 
the names, addresses, and even photos of these felons (since many gun 
stores have security cameras). Since the NICS system went online, law 
enforcement has had instant notification of the felony-in-progress. 
While the NICS check stopped the purchase from the legal source, the 
federal firearms licensee, only arrest and prosecution could stop the 
convicted felons and fugitives from acquiring firearms from illegal 
sources.
---------------------------------------------------------------------------
    \8\ Background Checks for Firearm Transfers, 1999, 1 Bureau of 
Justice Statistics Bulletin (June, 2000).
    \9\ Id. at 3.
---------------------------------------------------------------------------
Prosecution of NICS Denials
    Shockingly, the Administration has failed to arrest and prosecute 
these felons in search of firearms. According to the Administration's 
own Bureau of Justice Statistics, during 1999, the administration 
prosecuted only 405 defendants under Sec. 922(a), which includes NICS 
denials offenses.\10\ This constitutes a prosecution rate of only 
0.198%. Thus, 99.802% of the 204,000 convicted felons, fugitives, and 
spouse abusers and other disqualified persons who illegally attempted 
to purchase a firearm last year were not prosecuted!
---------------------------------------------------------------------------
    \10\ John Scalia, ``Federal Firearm Offenders, 1992-98,'' Bureau of 
Justice Statistics Special Report, June 2000, NCJ 180795, Appendix 
Table 3, http://www.ojp.usdoj.gov/bjs/pub/pdf/ffo98.pdf, (although this 
report lists preliminary figures for 1999 of 391 Sec. 922(a) 
prosecutions, BJS subsequently provided final data for 1999).
---------------------------------------------------------------------------
    Thus, these criminals were completely free to purchase firearms 
from illegal sources and commit crimes of violence. This situation is 
intolerable, and must be remedied.
    Specifically, I believe that the FBI, BATF, and the Department of 
Justice should develop a program for the apprehension, investigation, 
and prosecution of felons who violate 18 U.S.C. Sec. 922(a)(6) by 
illegally attempting to purchase firearms. If we cannot substantially 
increase the prosecutions of criminals who illegally attempt to 
purchase firearms, NICS checks will prove an ineffective barrier to 
crime. In short, a federal background check is only as good as the 
federal prosecutor who stands behind it.
    Thank you, Mr. Chairman. I appreciate the opportunity to work with 
you on this important issue.

 Prepared Statement of Hon Bob Barr, a U.S. Representative in Congress 
                       From the State of Georgia

    Mr. Chairman, Committee Members, thank you for allowing me to make 
a statement on this urgent issue. The state of the National Instant 
Check System (NICS) is of immense concern to me, my constituents, and 
millions of Americans denied the ability to exercise their 
constitutionally guaranteed right to keep and bear arms. I hope this 
hearing accomplishes what I have not been able to do--obtain answers as 
to why this system is so unreliable.
    In just the past couple of months, the NICS system has been 
``down'' twice. Not only has the system been down twice, but the timing 
always seems to be such that it is down for entire weekends, the time 
during which most gun shows take place.
    When I inquire as to why other check systems remain operable and 
reliable, as opposed to the NICS, which shuts down often, the reply is 
that NICS relies on ``other systems'' to operate, so if one system is 
down, the entire NICS is down. Another reason given is the lack of a 
backup system for the NICS. In a letter I received from the FBI dated 
June 16, 2000, David Loesch, the Assistant Director in Charge of the 
Criminal Justice Information Services Division, states in response to 
the lack of backup problem, ``while one option under consideration (to 
solve this problem) is the development of backup systems, all options 
will undergo a risk/cost benefit analysis.'' This is completely 
unacceptable.
    The firearms industry and United States citizens rely upon this 
system to ensure that criminals are not able to obtain firearms 
illegally, and law abiding citizens are able to purchase firearms. 
These establishments are required to provide NICS background checks by 
law before completing a firearm sale. When the system shuts down, these 
sales are brought to a halt. No purchase or sale of firearms are 
allowed. In some cases, persons travel hundreds of miles to attend gun 
shows for the sole purpose of purchasing a firearm. How do we explain 
to them over and over again that, although they are law abiding 
citizens who have the constitutional right to purchase firearms, they 
cannot do so because the system is ``down again?'' The same holds for 
the dealers who rely on these shows to make an honest living.
    In lieu of the major, and increased, funding in the past couple of 
years to the FBI for the NICS (some $28 million from FY99 to FY00), I 
cannot understand how the system can be such a failure. It seems to be 
just another case of money being allocated, yet not used for the 
intended purpose.
    Finally, there is one additional issue which needs to be addressed. 
In light of all of the rejections by the NICS, why isn't the federal 
government prosecuting these persons who attempt to illegally purchase 
weapons? The present Administration continues to implement more control 
while not enforcing the existing laws.
    Mr. Chairman, again, I thank you for holding this hearing, and look 
forward to receiving straight, honest answers.

                                
